2026 Investment Banker Salary and Bonus Report: To the Senior Bankers Go the Spoils

NOTE: This article is an update to last year’s compensation report because the numbers haven’t changed much. I’m leaving the comments from last year’s article in place for this reason as well.

The 2020s have been a bit of a rollercoaster ride for investment banker salaries and bonuses.

In 2021, booming SPAC activity, 0% interest rates, and COVID-inspired deals boosted fees and hiring to absurd levels…

…but then compensation fell back down to earth as interest rates rose and the world normalized in 2022 and 2023.

Then, 2024 and 2025 seemed like a return to form, with M&A deal volume up 20%, 30%, or even 50% in some regions; investment banking fees rose 10 – 30% in each year.

Unfortunately, that didn’t translate into significantly higher compensation for Analysts and Associates; most of the benefits went to senior bankers.

Based on end-of-year 2025 bonuses, total compensation rose ~5% for Analysts and Associates, 10 – 15% for VPs and Directors, and ~25%+ for MDs:

Position Title	Typical Age Range	Base Salary (USD)	Total Compensation (USD)	Timeframe for Promotion
Analyst	22-27	$100-$125K	$165-$225K	2-3 years
Associate	25-35	$175-$225K	$285-$500K	3-4 years
Vice President (VP)	28-40	$250-$300K	$525-$800K	3-4 years
Director / Senior Vice President (SVP)	32-45	$300-$350K	$700-$900K	2-3 years
Managing Director (MD)	35-50	$400-$600K	$1-$2M+	N/A

NOTE: All numbers are pre-tax for New York-based front-office roles and include base salaries and year-end bonuses but not signing/relocation bonuses, stub bonuses, benefits, etc.

These are roughly the 25th to 75th percentile ranges across the “large banks” (i.e., excluding 5-person regional boutiques).

And yes, some elite boutiques paid above these ranges (more on that below):

What Happened to Deal Activity and Investment Banker Salaries and Bonuses Last Year?

I always start by looking at the total investment banking fees by region and M&A deal volume by region:

Investment Banking Fees by Region and Annual Growth Rates:

M&A Deal Volume by Region and Annual Growth Rates:

M&A deal volume in dollars was up by almost 50% worldwide (some estimates say it’s more like 35 – 40%), but investment banking fees rose by only 10 – 20% in most regions.

I can’t say exactly why this happened, but it’s likely because:

1. Capital markets activity increased by much less than M&A deal volumes in most regions (5 – 10%).
2. Much of this M&A activity was for speculative mega-deals that may not close. And if the deal doesn’t close, banks do not get paid (much).
3. In some regions, there is fee compression due to competition and more deal work being done internally at companies.

Interestingly, tariffs – which everyone freaked out about in the middle of the year – did not end up mattering that much, though they may have killed a few deals.

The uncertainty around them, the constant policy flip-flops, and the general incompetence around their execution also factored in.

The Fed reduced short-term interest rates slightly, and CPI inflation fell very slightly, but I don’t think these played a big role.

I would argue that the increased deal activity had more to do with lax antitrust enforcement by the Trump administration and continued AI hype than anything else.

But if investment banking fees rose by 10 – 20%, and global M&A deal volumes were up by 40 – 50%, why did average Analyst and Associate compensation rise by only 5%?

The simplest answer is that it’s still an employers’ market, so firms can pay junior bankers almost anything they want.

Banks are willing to pay up for rainmaking MDs who can generate significant fees, but it’s no longer 2021, when banks needed a lot of junior employees to grind through deals.

The increase in M&A deal volume was heavily weighted toward a small number of mega-deals, which tend to be more efficient from a Revenue / Employee perspective.

Also, hiring in peer industries (Big Tech, management consulting, law, etc.) is terrible, so banks do not feel much pressure to increase compensation.

Specific Trends in Investment Banker Salaries and Bonuses

Looking at ~200 data points on salaries and bonuses for this year, a few trends stood out.

First, yes, some of the elite boutiques pay higher bonuses, but this is mostly visible at the Associate and VP levels and above.

For example, Perella Weinberg Partners (PWP) and Centerview (CVP) are well-known for paying Associates $50 – $100K+ more than the ranges quoted above.

Unlike the bulge brackets, they also pay these bonuses in 100% cash.

But at the Analyst level, total compensation was much closer to normal at these firms and other elite boutiques:

• From what I could tell, firms like Lazard, Evercore, and Moelis paid top-ranked Year 1 Analysts nearly the same total compensation as the bulge brackets (e.g., $180 – $195K range). PWP also appeared to be in this range.
• Top-ranked Year 2 Analysts at the EBs earned above the $225K top-end of the Analyst range above, but these were mostly 10 – 15% differences (e.g., $250K total compensation).

Some banks also pay very different amounts depending on your “bucket” (e.g., top-ranked vs. upper vs. middle vs. bottom), but this varies widely by firm and level.

Another notable trend is that bonuses do not necessarily have much to do with the deal flow, reputation, or “ranking” of the bank.

For example, Bank of America is normally viewed as a “mid-tier bulge bracket,” but for some reason, it seems to pay awful bonuses to mid-level bankers while treating Analysts and MDs well.

For example, BofA apparently paid some Year 3 Associates bonuses in the $110 – $150K range, while most other banks paid in the $200K – $300K+ range.

Meanwhile, a few seemingly “random” banks, like Santander, paid quite well for New York-based roles.

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I’ll comment more on these trends below, but here’s a quick reminder of the main compensation components if you haven’t read these reports before:

Investment Banker Salary and Bonus Levels: The Main Components

For most bankers, there are five main components to “compensation”:

• Base Salary: This is what you earn via paycheck or direct deposit every two weeks. These numbers tend to stay the same for years and then move up periodically at the Analyst and Associate levels. At most banks, these were last adjusted in 2022.
• Stub Bonus: Since Associates graduate from MBA programs and start working in the middle of the calendar year, they receive “stub bonuses” for their first ~6 months on the job. These are similar across banks and might be ~$35 – $50K, depending on the region.
• End-of-Year Bonus: You earn this after your first full year of work. Analyst bonuses are 100% cash, but a percentage shifts to stock and deferred compensation as you move up. For example, Associate and VP bonuses might be 20 – 30% deferred, while MD bonuses could be 30 – 50% deferred.
• Signing/Relocation Bonus: This applies to Analysts and Associates who graduate and accept full-time offers; like the stub bonus, it’s usually a small percentage of your base salary.
• Benefits: Finally, you’ll get health insurance, vacation days, and participation in the firm’s profit-sharing or 401(k) retirement plans. In Europe, this one mostly takes the form of “more vacation days” since healthcare is government-funded via higher taxes.

Investment Banker Salary and Bonus Levels: Analysts

Since most Analysts start working in the middle of the calendar year after graduation, the numbers here are based on mid-2025 payouts.

We estimate the top end of the range at $225K, but some Year 2 Analysts at elite boutiques earned above that, with a few at bulge brackets joining them.

Year 3 Analysts are a rare species these days because most banks now promote Analysts after two years, but compensation at that level seemed to be in the $200 – $270K range.

If we say the midpoint of Analyst total compensation is $195K, it’s a ~5% increase over the midpoint of last year’s range.

That’s not terrible, but it is disappointing given the 10–20% increase in IB revenue.

Investment Banker Salary and Bonus Levels: Associates

I gave a few sample numbers for Associates to illustrate the massive spread, with bankers at firms like PWP and CVP potentially earning $100K+ more than those at the bulge brackets.

Bonuses at this level are normally 60 – 70% of base salaries for Year 1 Associates, but this rises to ~100% (or more!) at many firms by Year 3.

The elite boutiques pay even more than this, and some even pay 100% cash bonuses.

For firms that do not pay 100% cash bonuses to Year 2 and 3 Associates, the split tends to be 70 – 80% cash, with the rest deferred or paid in stock.

You should expect more variable bonuses as you move up, starting at the Associate level.

Investment Banker Salary and Bonus Levels: Vice Presidents

I found a decent amount of VP-level compensation data this year, so I am more confident of the ranges here.

At this level, bonuses tend to be ~100% of base salaries initially, rising to 200% or 250% of base salaries for Year 3 VPs.

Again, the EB banks will pay at the top end or even above it, while firms like BofA seem to pay well below this (maybe with exceptions for top performers).

Investment Banker Salary and Bonus Levels: Directors

It’s almost impossible to find accurate data on bankers at this level, but I found a few examples pointing to a ~15% increase, which explains my $700K – $900K range above.

But I would not be surprised if some Directors at elite boutiques earned above that, perhaps into the $1M range.

Investment Banker Salary and Bonus Levels: Managing Directors

Managing Director compensation tends to correlate most closely with investment banking fees and deal activity.

Their bonuses are literally percentages of the fees they generate, so the sky’s the limit in a great year, while $0 bonuses are possible in a terrible year.

The $1M – $2M compensation range above is for “Junior MDs” who are still getting up to speed on execution and clients.

More experienced MDs could earn above that, and Group Heads who do well could earn even more, perhaps into the $5M+ range.

That said, the “average MD” does not earn in that range; sources like the WSJ have studied this and found median annual compensation in the $1 – 2 million range over multiple decades.

(And yes, that means that inflation-adjusted pay hasn’t increased much.)

Expect 30 – 50% of bonuses to be deferred or paid in stock at this level.

Regional Differences and London Numbers

Unfortunately, no one seems to publish solid compensation reports for London anymore.

But from what I can gather, you should expect a 15 – 30% discount to NY compensation numbers there.

If base salaries progress from £70K to £90K, a reasonable total compensation range for Analysts might be £100K to £150K, or roughly $135K to $200K USD (assuming a 1.35x GBP/USD).

It seems like Associate base salaries go from £115K to £135K as you advance, with bonuses at 80 – 100% of base salaries.

This would equate to a total compensation range of around $280K to $365K USD at the same 1.35x FX rate.

I do not have numbers for Asia, Australia, or other regions, but feel free to chime in if you do or know of good sources for them.

What Does This Mean for Future Investment Banker Salary and Bonus Levels?

In the 2025 report, I predicted that bonuses would change by +10% to –10%, which is close to what happened.

I’ll be more specific this year and predict that bonuses will be flat at most levels.

Why?

First, I think at least a few of the mega-deals signed in 2025 will fall apart due to regulatory, antitrust, or geopolitical factors.

IPO activity for 2026 will be stronger, driven by companies like SpaceX and OpenAI, but that won’t be enough to offset lower M&A advisory fees.

Also, there’s a moderate chance the AI bubble will start to deflate as more investors ask questions about massively higher CapEx spending by Big Tech.

Lower stock prices and more “questions asked” tend to make companies more cautious and less likely to execute large deals.

In last year’s report, I also mentioned that it was tough to make a strong case for the bulge bracket banks over the elite boutiques, at least based on long-term compensation and promotion opportunities.

That is still true, but I’ll be even more specific: Bank-specific differences within each category matter a lot more now.

Specific EBs, such as PWP and CVP, now seem to pay significantly more than the others.

Meanwhile, some of the “weaker/borderline” bulge brackets, such as UBS, appear to pay mid-level bankers more than “stronger” ones, such as BofA.

The decision-making process becomes a giant branching tree when you account for all these factors.

And the more twists and turns bonuses take on their rollercoaster ride, the more branches get added to that tree.