The Winners of Wall Street Bonus Season This Year: the Underwriters

• Wall Street bonus season is fast approaching.
• For the first time since 2021, payouts could be higher across the industry.
• See who stands to take home the biggest checks, according to the comp consultant Johnson Associates.

Bonuses are projected to be up across the financial-services industry — asset management, alternatives, and investment banking — for the first time since 2021, a new report said.

The compensation consultancy Johnson Associates issued its annual bonus findings on Tuesday. It predicted that some financial-services professionals could see year-end bonus increases of as much as 35% over last year.

The report includes an analysis of 13 of the nation’s largest investment and commercial banks and 17 of the largest traditional- and alternative-asset-management firms. Johnson Associates’ predictions come as firms from Goldman Sachs to Blackstone report signs of a corporate-dealmaking surge.

The financial professionals poised to rake in the most, meanwhile, are not the usual “rainmakers” of Wall Street but a more behind-the-scenes group: the underwriters.

Here’s a look inside three slides from the Johnson Associates report that illustrate key findings.

Debt underwriters stand to see the biggest bonus bumps this year — up to 35% over 2023, Johnson Associates’ founder, Alan Johnson, told Business Insider.

Equity underwriters are a close second, with the report projecting increases of as much as 25%, followed by sell-side sales and trading professionals. Investment bankers focused on mergers and acquisitions — also known as advisory professionals — are likely to see only subtle bumps in bonus pay from last year, the report said.

Of course, M&A advisors are starting to see signs of a dealmaking resurgence thanks in part to the Federal Reserve’s campaign to lower interest rates, which could lead to bigger bonuses next year.

“Unless things go sideways unexpectedly, M&A — the sexiest of the sexy businesses — will hopefully have a very good 2025,” Johnson told BI.

Johnson said he saw bonuses for asset-management professionals increasing anywhere from 7% to 12% and bumps of 5% to 15% for hedge-fund employees.

Asset management is set to be another winner. While Johnson predicted overall gains of 7% to 12%, some firms have set aside bonus pools that are 20% larger than last year, as the chart above shows. (Each letter in the bar graph above represents a different firm.)

This is also true for asset-management divisions within banks, he said.

“There’s been a sea change in financial services where the sexiest businesses used to be the high-volatility trading and banking,” Johnson said. “But now it’s the more fee-driven businesses of asset and wealth management, which is more predictable, and it doesn’t have as much of an impact on our capital use.”

Overall, the numbers are good compared with the past couple of years, and OK in the grander scheme of things, he said. They look more like prepandemic levels.

“This is kind of a little bit of coming out of the trough, but it’s certainly not as high as it’s ever been,” he added.

See the full report on the Johnson Associates website.