Not too surprisingly, it turns out that big banks are where the money is both literally and figuratively. According to salary-benchmarking site Emolument.com, employees at big banks in London are paid notably more than their peers at smaller boutique banks.
More on pay at London big banks versus boutique banks
The August 26th article from Emolument.com highlights that there is an “important pay gap at every level of seniority with sizable differences in both salaries and bonus amounts.”
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Also of note, the size of the pay gap between boutique banks and big banks increases by the seniority of the position. For example, the difference in total compensation at London big banks versus boutique banks is 18% for analyst positions, 24% for directors and a whopping 29% for managing directors.
That said, working at a boutique bank isn’t all bad. In fact, boutique banks certainly have their perks too. First, new employees tend to get more real mentoring in a boutique, rather than being expected to “sink or swim” at most big banks. Second, while employees are still expected to work long hours, the general perception in the industry is analysts at boutique financial institutions will not be sleeping at the office like some of their big bank colleagues. Third, and a major incentive, almost half of directors can expect to be promoted to managing director, compared to around a third at big banks.
Statement from Alice Leguay of Emolument
Finally, Alice Leguay from Emolument reminds readers that employment is not just about compensation. “It’s not just about the money: in a smaller shop, bankers are highly likely to feel a stronger sense of ownership, making more of an impact on the direction of the business, whereas listed bank employees have felt more and more disenfranchised over the last few years, stifled by red tape and intense internal politics as they took hits from the media, stock markets and regulatory bodies.”