Banking & Financial Services 2016 Salary Guide

Sandeep Mohanan 18.01.2016

The 2016 banking & financial services salary guide: Salaries for asset management, operations, hedge fund, private equity, investment banking, capital markets and private banking.

Asset Management SalariesEquity/Fixed Income Research Salaries | Investment Banking & Private Equity SalariesCorporate Banking Salaries | Private Banking Salaries | Banking Operations Salaries

Asset Management Salary Ranges

Role: Analyst Associate/AVP VP/Sr. Manager SVP/Director MD
BASIC SALARIES (HK$ PER MONTH)
Fund Manager $45k - $55k $55k - $70k $70k - $95k $120k - $200k $250k+
Research Analyst $30k - $45k $45k - $60k $63k - $83k $92k - $150k $180k+
Retail / Institutional Marketing $15k - $25k $25k - $45k $45k - $65k $65k - $90k $150k+
RFP Writer / Investment Writer $20k - $30k $30k - $45k $50k - $70k $70k - $100k $100k+
Performance Analyst $20k - $30k $40k - $50k $50k - $85k $100k - $120k -
Retail/ Intermediary Sales $25k - $50k $35k - $80k $60k - $120k $80k - $150k $150k+
Institutional Sales $25k - $50k $35k - $80k $60k - $150k $100k - $200k $200k+
Client Relationship / Acc. Management $17k - $25k $25k - $45k $45k - $70k $70k - $100k $100k+
Execution Trader / Dealer $20k - $30k $30k - $50k $50k - $70k $70k - $120k $150k+
Product Development / Management $20k - $30k $30k - $50k $50k - $70k $70k - $150k $100k+
Product Specialist $30k - $45k $45k - $65k $65k - $92k $95k - $150k $200k+

There is significant growth potential within Asia’s asset management industry, and overall we expect the sector to experience significant growth in 2016. There is continuing appetite from regional institutional clients to diversify their investment portfolio in both traditional and alternative asset classes, and there is huge potential within the retail market as well due to MRF (mutual recognition of funds) in Hong Kong and ASEAN Passport in South East Asia.

MRF, allows funds established in Hong Kong to be accessible to Mainland China investors and vice versa. This is significant as it will allow Chinese investors access to international markets, which was only previously possible for a small proportion of the population. With a new generation of well educated middle class Chinese generating wealth, the Chinese asset management industry should surpass the markets in Japan and Australia, given time.  

Several hundred asset managers have applied to the Hong Kong regulator for MRF status, and we expect continued appetite for Asset Management professionals in Hong Kong. Institutional salespeople have been highly sought-after and there has been significant movement of these professionals, particularly in north Asia in 2015. In addition, there has also been movement in other positions such as product development over the course of the year. Overall it has been a busy 12 months.  

Local language skills are in many cases essential in client facing asset management roles in Hong Kong, as the core markets covered in North Asia are greater China and Taiwan. Internal mobility from locations such as New York or London in these positions can be challenging, unless it is for leadership positions. In non-sales roles, local language skills are less important. Local market knowledge is desired in most cases. Candidates with client contacts and experience in regional markets, such as China, Korea and Taiwan are sought after. Opportunities for relocation to Asia for senior positions are becoming less prevalent, as there is a preference for locals with the right language skills, and cross cultural understanding. Permanent roles dominate the landscape, as operations are generally lean. It is therefore rare to see professionals contracting unless it is for technology based projects.

We expect salaries in infrastructure roles to experience incremental growth of 5% in 2016, or potentially 5-%-10% for the top performers. Within front office, many roles are benchmarked, and pay levels are comparatively similar across the market. 

Equity/Fixed Income Research Salary Ranges

Role:      
Research Associate $50k - $120k Supervisory Analyst 100k - 180k
Research Vice President $120k - $180k Head of Product 150k - 200k
Research Director $150k - $230k    
Research MD $180k+    

The China crisis is impacting growth across equity research. China’s economic slowdown has affected the global economy, which means that bulge bracket banks do not have the capital to hire. As a result many positions are being put on hold and there is a lot of outsourcing occurring. Areas that were quieter last year have seen a significant increase in hiring. For example, Financial Institutional group (FIG) is one of the hottest sectors right now, with many banks looking to hire a strong FIG Analyst covering Chinese banks or Insurance.
 
China’s Internet sector is also booming, with a considerable amount of IPOs going on. Successful capital raising for larger players such as Tencent and Alibaba in the States is now being followed by "smaller" tech companies, with significant IPO pipeline anticipated through 2016 in Hong Kong.
There are an increasing number of women occupying senior management positions. Many banks have diversity initiatives that encourage females to take over senior roles and provide better maternity leave and benefits.

The ratio of local to international professionals across equity research is 90:10. Banks prefer to hire locals, unless there is an immediate vacancy in an area with a talent shortage. For example, the Internet is one area where there is a lack of skilled professionals in Hong Kong, and banks may be open to hiring someone from the USA.
There are very few opportunities for professionals to take on international roles. This is because local market knowledge is essential, unless it is a position with a Pan-Asia focus. These jobs occur more on the senior management side.

Approximately 80% of equity research roles are permanent and about 20% are contract, as banks are mostly looking to hire on a permanent basis. However, due to budget pressures, contracting is on the increase, particularly at the junior level. Banks can probably hire an associate on a contract basis for half the price that they have to pay for a permanent professional because they do not have to pay for other benefits as well.

In 2016, bulge bracket banks will continue to pay higher base salaries with lower bonuses. However, Chinese platforms will offer lower bases with a better bonus system. For external moves, professionals can expect salary increments of approximately 15%-20%, and up to 25% for top talent.

Investment Banking & Private Equity Salary Ranges

Corporate Finance Sales & Trading
BASIC SALARIES (HK$ PER MONTH)
Analyst 1 $40k - $70k Sales – Institutional – Analyst $40k - $60k
Analyst 2 $50k - $80k Sales – Institutional – Associate $50k - $70k
Analyst 3 $60k - $90k Sales – Institutional – VP $130k - $160k
Associate 1 $70k - $125k Sales – Corporates – Analyst $40k - $60k
Associate 2 $80k - $140k Sales – Corporates – Associate $50k - $70k
Associate 3 $100k - $150k Sales – Corporates – VP $130k - $160k
VP $130k - $170k Trader – Analyst $40k - $60k
Director $160k - $225k Trader – Associate $80k - $120k
Managing Director $250k+ Trader – VP $130k - $160k

There has been less turnover in 2015 in investment banking compared to that of 2014, with a few larger European and American banks having made a small number of redundancies.

After remaining static for the past five years, 2015 saw an increase in salaries. A number of American banks increased base salaries by 20%-25% in order to retain employees. However, as a result bonuses are expected to be smaller this year. Whilst we expect salaries to remain static in 2016 at bulge bracket firms, we expect salaries at Chinese banks to increase as they continue to seek to attract and retain qualified staff. Overall, hiring in investment banking is cyclical, and has become more so at junior levels with analysts now receiving their bonus payments in Q1 of each year as opposed to the second half of the year.

Investment banking is still male dominated. The extremely long working hours are often not compatible with having children and family life, and therefore there tends to be fewer women across this discipline. At the senior level, 80% of positions are occupied by men. Although there is a trend towards hiring more females, they often leave when they want to start a family or have caring responsibilities. In general, Mandarin speaking professionals that are born in China and schooled in the USA or UK are still highly sought-after for investment banking roles in Hong Kong.

Private Equity Salary Ranges

Role:     Private Equity    
BASIC SALARIES (HK$ PER MONTH)
  Analyst Associate VP Junior Partner Senior Partner
Investor Relations $25k - $35k $35k - $50k $65k - $100k $92k - $170k $200k+
Investment Analyst $35k - $80k $70k - $130k $130k - $200k $160k - $225k $110k - $260k

Since the start of 2016, we have seen a steady increase of candidate requests for roles in private equity firms. This is partially due to market uncertainty and coupled with the decline of available positions in global investment banks. With banks making sizable redundancies since the start of the year. candidates are now turning to buy-side organisations that can offer stability and competitive remuneration

With private equity investing likely to increase for the remainder of 2016 and heading into 2017, we expect to see a number of both regional and global players adding talents to their stables in the coming months.

Corporate Banking Salary Ranges

Corporate Banking - Product Specialist
BASIC SALARIES (HK$ PER MONTH)
  Project Finance Commodity & Trade Finance Structured Finance
Analyst 35k - 55k 35k - 55k 35k - 55k
Associate 60k - 70k 60k - 70k 60k - 70k
AVP 70k - 85k 70k - 85k 70k - 85k
VP 90k - 120k 90k - 120k 90k - 120k
SVP/ Team head / Director 130k+ 130k+ 130k+
       
Commercial Banking Relationship Management Corporate Banking Relationship Management
BASIC SALARIES (HK$ PER MONTH)
Associate 20k - 30k Associate 30k - 40k
AVP 30k - 40k AVP 40k - 50k
VP 40k - 65k VP 50k - 80k
SVP/ Team head / Director 65k - 85k SVP/ Team head / Director 80k - 120k

The overall economic environment is affecting growth across Hong Kong’s corporate banking sector. There is a lack of available professionals, and companies are struggling to find individuals with the right skill sets, such as the ability to manage large scale accounts. Many corporate bankers handle small medium enterprises or mid cap clients, and do not have experience with larger companies. Furthermore, due to the skills shortage, professionals have an abundance of jobs to choose from. 

Chinese banks are actively hiring, more so than international banks which are already well established in Hong Kong. Whilst it is predominantly replacement hiring occurring at the global banks, Chinese banks are creating new teams and new headcount, in an effort to innovate and compete with the more established players.

The ratio of male to female professionals across Hong Kong’s corporate banking sector is about 60:40. At the senior management level, the number of men increases to approximately 80%. 
However, there are more women working in this area than 10-20 years ago and more females occupy head of department positions than ever before. The majority of corporate banking professionals are locals. However, for a niche position, such as one that deals with clients in Mainland China, companies may need to hire someone from overseas that has the relevant market experience and is a native Mandarin speaker. For senior hires, firms prefer professionals who have worked for at least two years in the Hong Kong market. 

Salary increments across corporate banking will be approximately 3%-5%. For external moves, professionals can expect salary increments of around 20%. Chinese banks will find 2016 challenging due to the continued economic slowdown in Mainland China. It would not be surprising if Chinese banks made redundancies, and experienced headcount freezes or a slowdown in hiring over the coming year.

Private Banking Salary Ranges

Role: Associate Associate Director/VP Director Executive Director MD
BASIC SALARIES (HK$ PER MONTH)
Private Banker $40k - $55k $60k - $100k $110k - $125k $130k - $150k $160k+
Fund / Portfolio Manager $40k - $50k $50k - $70k $80k - $120k $130k - $150k $150k+
Invest. Advisor/Consultant $35k - $50k $60k - $80k $100k - $120k $125k - $150k $150k+
Product Specialist $35k - $50k $50k - $70k $80k - $125k $125k - $150k $150k+
Trade / Dealer $30k - $50k $50k - $80k $80k - $100k $100k - $130k $130k+
Business Management $35k - $45k $50k - $80k $80k - $120k $130k - $150k $150k+
Assistant Relationship Mgr. $30k - $50k $50k - $80k - - -
Product Dev. / Mgmt. $35k - $45k $50k - $70k $80k - $100k $100k - $120k $130k+

A shortage of wealth management professionals is affecting growth across Hong Kong’s private banking sector. Relationship managers, who have good relationships with high net worth individuals, are highly sought-after. Furthermore, due to Hong Kong Monetary Authority regulations, professionals with good regulatory knowledge are also in demand. 

Hong Kong’s private banking sector is heavily focused on Greater China, and Chinese language skills are essential. Often professionals are trilingual in English, Mandarin and Cantonese. Therefore, most hires are locals, as they need to be able to communicate effectively with Chinese high net worth clients. Occasionally, overseas professionals will be brought in for business management positions.

There are opportunities for international mobility within the private banking sector. Particularly for business manager roles, there are opportunities for relocation to Mainland China. Companies want these professionals to develop their knowledge and expertise of the Chinese market, as it is a key business area. 

Salaries are not expected to change significantly. In the private banking industry, salaries and bonuses are determined by the revenue generated. Basic salaries are expected to increase by 3%-7%. For external moves, salary increments are typically 20%. However, due to cost pressures they are expected to be slightly less this year, with companies offering basic salary increases of 15%-17%. 

Banking Operations Salary Ranges

Role: Analyst Associate/AVP VP Director Sr. Director
BASIC SALARIES (HK$ PER MONTH)
Trade Support $25k - $45k $35k - $75k $75k - $115k $120k - $150k 160K+
Client Services $25k - $40k $35k - $75k $75k - $100k $110k - $125k 150K+
Settlements $18k - $28k $30k - $55k $55k - $80k $70k - $100k 100K+
Documentation $18k - $28k $30k - $55k $55k - $80k $70k - $80k 100K+
Business Analyst / Projects $30k - $40k $45k - $75k $75k - $100k $110k - $125k 140K+
Client Onboarding $25k - $40k $40k - $75k $75k - $115k $120k - $150k 160K+
Other
Loans Administration $15k - $22k $22k - $35k $40k - $60k $60k - $75k 80K+
Static Data Analyst $15k - $22k $22k - $35k $40k - $60k $60k - $80k 85K+
Control / Reconciliations $22k - $35k $35k - $60k $70k - $90k $100k - $115k 125+
Asset Servicing $18k - $28k $30k - $45k $55k - $75k $75k - $85k 100K+
Cash Management $20k - $30k $30k - $50k $55k - $70k $70k - $90k 100K+

There has been significant downsizing across operations, as well as offshoring to low cost centres, such as The Philippines, Malaysia and India. Hiring managers have become more demanding; in order to justify staying onshore they need to retain their top talent. As a result, there is a skills shortage across the Hong Kong market. There has been an increase in regulatory-related positions, such as client onboarding, and operations regulatory reporting and control. There is continued demand for client facing professionals within operations, such as trader assistants, sales assistants and client services.

The operations market has a good gender balance. Many companies are promoting gender equality at all levels, and there is a trend towards women occupying more senior level board positions. Local hires dominate, and many companies will only look internationally if there is a skills shortage in Hong Kong. Whilst senior positions were previously occupied by professionals from the USA, Europe and Australia, this has changed and locals are now filling these roles.

Opportunities for international relocation typically occur at the senior level; however, it often depends on the requirements of the business. For example, a company that has offshored to a low cost center may require a senior manager to oversee the operations. Permanent hiring dominates the Hong Kong market and most professionals prefer the stability it offers. However, the contract market continues to grow and this type of hiring allows banks to assess an individual before offering them a permanent position.  Contract positions exist mainly at the junior level, as young professionals are more willing to accept lower salaries and a lack of benefits.

Due to ongoing cost pressures, salaries are expected to remain stable. For external moves professionals can expect pay increments of 10%-20%. Furthermore, work/like balance is increasingly important, and professionals will take this into consideration when looking at a new role. Operations professionals with regulatory experience are sought after, and for onboarding roles, knowledge of Dodd Frank, Foreign Account Tax Compliance Act and European Market Infrastructure Regulation, as well as Hong Kong Monetary Authority regulations and Securities and Exchange Board of India regulations is useful.

Sandeep Mohanan's picture
Senior Manager | Financial Services Front Office Recruitment
smohanan@morganmckinley.com.hk

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