Banking and Investment

Investment bank Moelis says junior pay is likely to keep rising across the industry

Boutique investment bank Moelis & Co. has hiked pay for junior bankers 30 percent this year — and according to its chief executive officer, they’re just getting started.

“We definitely expect to and are paying people more than we ever have,” Moelis & Co. founding chairman and CEO Ken Moelis said in an interview with Bloomberg Television Thursday. “We’re not doing it grudgingly. Business is booming,”

Moelis and other Wall Street firms have been spreading the wealth around this year as business reaches a fever pitch.

Last month, Moelis raised pay for first-year analysts from $85,000 to $110,000 and second-year analysts from $95,000 to $125,000 last month. Moelis declined to comment.

Over the past few months, firms all across Wall Street hiked pay for junior as banks including Goldman Sachs and JPMorgan have posted record earnings as the economy comes roaring back to life.

A boom in deal-making, capital raising and IPOs have all helped to lift investment banking revenues, while the trillions the Federal Reserve has been pumping into markets has lifted many stocks to new highs.

ceo ken moelis
“They’re working harder than they ever have, and technology is making them extremely productive,” Moelis said of junior bankers.
Sergei Karpukhin/TASS

In August, David Solomon’s Goldman Sachs also boosted base pay for junior bankers 30 percent, resulting in first-year associates earning $110,000. Earlier this year JPMorgan Chase, Citigroup and Morgan Stanley bumped pay for first-years up to $100,000 from $85,000.

Banks are doling out the beaucoup bucks to keep overworked talent from fleeing amid a dizzying workload thanks to the spike in deals.

In March, a leaked slideshow presentation compiled by 13 junior Goldman Sachs analysts detailed complaints about 100-hour workweeks. Some griped of shifts as long as 20 hours that left them little time to eat, sleep or shower, claiming that the grind damaged their physical and mental health.

The complaints led Goldman and JPMorgan to vow to hire more staff with the latter pledging to boost its headcount by 200. Private equity firm Apollo Global Management has reportedly offered some associates as much as $200,000 to stick around.

Elsewhere, Citibank CEO Jane Fraser told employees she was banning Zoom meetings on Fridays to address Zoom fatigue. Investment bank Jefferies even offered its junior staff the primo Peloton bike as a “thank you” for working long hours.

The six-figure salaries are just the base pay junior bankers receive — that number doesn’t include bonuses. For senior bankers, a bonus can be worth hundreds of thousands — or even millions of dollars.

“The deal flow, if it continues to rise the way it does, we need the best talent in the world,” Moelis added.