London may appear highly competitive for young professionals looking to enter the institutional and interbank sector, however the major institutions are paying four-figure signing on bonuses to junior staff who are often straight out of university to attract the right talent. These are tomorrow’s industry leaders
Demand for young and talented interbank professionals in London remains very high this year, and the plate glass institutions that adorn the banks of the River Thames and the Docklands areas of Canary Wharf are showing no signs of reducing signing on bonuses for new recruits that are not in positions of seniority.
A growing trend among large institutions seeking to attract the highest quality of talent at senior executive level over recent years has been to provide what is known as a signing on bonus, or ‘golden hello’, which usually constitutes a single up-front payment that at senior executive level can be any figure up to as much as one year’s salary.
That has become an essential tool to attract the best quality leaders away from their existing positions where they are usually highly valued and may be subject to a counter-offer should they be found to be in negotiations with another firm in order to consider moving on, however at junior level, as in those who have recently completed their Masters degree, signing on bonuses in London have now become prevalent.
Although opinions vary on the amounts offered, and very often institutions will not discuss the figures offered with anyone except for a potential candidate once the advanced post-interview negotiating is in place, FinanceFeeds conducted research this week in London, which shows ballpark figures for signing on bonuses for junior traders and analysts wishing to start their careers at some of the world’s most esteemed institutions.
Barclays Capital is one of the highest payers of signing on bonuses, at between £7,500 and £8,000, with Citigroup not far behind, offering approximately £7,000 to junior analysts.
Deutsche Bank has been offering approximately £6,000 in signing on bonuses recently, and Goldman Sachs and Morgan Stanley approximately £5,000 whereas Merrill Lynch and ABN Amro’s offers stand at approximately £4,000.
Unless the candidates credentials are absolutely exceptional, signing on bonuses at this level are very often not negotiable, however FinanceFeeds is aware of certain cases in which under 30 year old recruits have joined the interbank sector with elevated signing on bonuses, and to quote a particular source “I know of someone who has just been signed at Merrill Lynch, and his sign-on was a fair bit more than the one estimated here” however we understand that this is quite rare.
London is perceived as a highly competitive city in terms of there being a huge supply of very knowledgeable and well educated young professionals, many having completed not only private school education and two degress at prestigious educational establishments but internships on eFX desks at major Tier 1 banks or technology partnerships at Accenture or PriceWaterhouseCoopers in which they would have worked with London’s finest in developing solutions architecture for market infrastructure.
This gives the impression that the major institutions would have plenty of choice, however despite this, they are willing to pay large bonuses to recruits, demonstrating that London is as competitive for the companies as it is for the young professionals looking to form their career.
Whilst the initial few years at these institutions requires diligence and hard work, the result is worth it. These positions are the development ground for tomorrow’s leaders of the electronic trading industry, and will be empowered with the skills that will make their ability to innovate and continue to keep London at the forefront, very light work indeed.