2025 Investment Banker Salary and Bonus Report: How to Disappoint Bankers with… Higher Bonuses

Before bonuses were announced this year, there was a lot of hype over a “return to form.”

People looked at 2024 investment banking revenue, saw big increases, and assumed that investment banker salaries and bonuses would behave like a meme coin after stimulus payments and a celebrity pump-and-dump.

But… that didn’t exactly happen.

Base salaries stayed the same, and while bonuses increased substantially, total compensation was up by only 10 – 15% across most levels.

Global investment banking revenue increased by closer to 30%, with a 37% increase in the U.S.

I’ll summarize the numbers below and then explain what went wrong:

Position Title	Typical Age Range	Base Salary (USD)	Total Compensation (USD)	Timeframe for Promotion
Analyst	22-27	$100-$125K	$160-$210K	2-3 years
Associate	25-35	$175-$225K	$275-$475K	3-4 years
Vice President (VP)	28-40	$250-$300K	$500-$700K	3-4 years
Director / Senior Vice President (SVP)	32-45	$300-$350K	$600-$800K	2-3 years
Managing Director (MD)	35-50	$400-$600K	$800-$1600K+	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 25^th to 75^th percentile ranges across the “large banks” (i.e., excluding 5-person boutique firms).

Yes, I’m aware the elite boutiques paid above these ranges.

Now to the commentary:

What Happened to Investment Banker Salaries and Bonuses Last Year?

I think these two charts from Dealogic sum up the market quite well:

In short, yes, total IB revenue was up by 20 – 40% in most regions, but M&A advisory revenue increased by more like 10 – 20%.

It’s great that equity capital markets and debt capital markets activity increased as issuances picked up.

But these areas always tend to be less profitable for banks because there’s more overhead, and the fees are split between more groups and individuals.

Deal activity picked up for a few reasons:

• Central banks started cutting short-term interest rates.
• Inflation appeared to moderate vs. its 2022 – 2023 levels.
• Executives became increasingly excited about a new administration in the U.S. and potentially lower corporate taxes and a reduced regulatory burden.
• Wars and geopolitical uncertainty continued in some regions (Ukraine, the Middle East, etc.), but many people expected them to start winding down.

Finally, there were no major financial crises, such as the collapse of Silicon Valley Bank or the UBS acquisition of Credit Suisse in 2023.

So, why didn’t total compensation increase by more than 10 – 15% at most levels?

1. Higher Base Salaries – One consequence of the higher base salaries for Analysts and Associates, put in place in 2021 – 2022, is that bonus increases make less of an impact on total compensation now. Essentially, higher base salaries reduce the “Beta” of total compensation to fees.
2. Total IB vs. M&A Fees – As discussed above, not all fees are created equal. Higher capital markets fees help, but since they’re lower margin, they won’t necessarily help to the same extent that higher M&A fees will.
3. COVID Over-Extension and Bad Memories – After boosting hiring and compensation significantly in the 2020 – 2021 period and then pulling back when the market turned, banks are still cautious about altering compensation levels too much in a short period.
4. Lack of Other Options in the Job Market – The environment at finance competitors such as the Big Tech companies has changed significantly over the past few years, and it is now much harder to get cushy, high-paying jobs there. Top engineers can still do it, but it has gotten harder for product managers, salespeople, etc.
5. Uncertainty Over Deal Activity – Yes, many bankers were optimistic in 2024, but “optimism” is not the same as “willing to bet the bank on a big rebound.” Most knew there was also significant risk from new trade wars, continued anti-trust scrutiny, and fewer interest rate cuts than expected.

Specific Trends in Investment Banker Salaries and Bonuses

It’s getting increasingly “complicated” to compile these updates because there’s a crazy variance between different banks now.

In the 2010s, the elite boutiques usually paid higher bonuses to Analysts and Associates, and the senior bankers also had a higher compensation ceiling.

As of 2025, however, even firms within the same category seem to pay very different amounts.

As a specific example, Lazard now seems to pay less than other elite boutique banks but still at/above the level of the bulge brackets.

A Year 1 Associate there might earn total compensation just above $300K, which was on par with some of the BB banks (GS and JPM) and above others (MS and BofA).

However, the total compensation at a place like PJT Partners seems to go all the way up to $400K for top-ranked Year 1 Associates.

Most Associates will not be in the top bucket, but quite a few will earn significantly more than Associates at the bulge brackets.

Meanwhile, some Big 5 Canadian banks, such as TD Cowen, seem to be paying outsized bonuses to attract new talent.

I don’t think this is sustainable, but take advantage of it while it lasts, I suppose?

The stock and deferred components of compensation also seem to be creeping up – not great if there’s another UBS / CS “acquisition” situation…

Finally, there seem to be some oddities around base salaries, with UBS paying slightly less to some Analysts following the CS acquisition (e.g., $115K rather than $125K for Year 2 Analysts).

And I don’t know if this is a recent development – I may have missed it – but the elite boutiques also seem to pay ~$25K higher base salaries to Associates.

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I’ll explain some of these trends in more detail below, but here’s a quick reminder of the main compensation components:

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 least at the Analyst and Associate levels. These were last adjusted in 2021 – 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 typically the same or very similar across banks and might be ~$35 – $45K, depending on the region.
• End-of-Year Bonus: You earn this after your first full year of work. Analyst bonuses are almost always 100% cash, but a percentage shifts to stock and deferred compensation as you move up. For example, Associates might get 10 – 20% deferred, VPs might get 20 – 30% deferred, and MDs might get 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 low 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 places like 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 year after graduation, the numbers here are based on mid-2024 payouts.

I listed $210K as the top end of the range above, but plenty of 2^nd Year Analysts at elite boutiques likely earned above that number.

It’s difficult to find Year 3 Analyst compensation anymore because most banks now promote Analysts after two years, but compensation at that level is likely close to what Year 1 Associates earn.

If you take $185K as the midpoint of this range ($160K – $210K), it’s roughly a 12% increase over total compensation last year.

I don’t think this is a bad result, considering the 10 – 20% increase in M&A fees.

Investment Banker Salary and Bonus Levels: Associates

I gave a few sample numbers above for Associates to illustrate the massive spread, with bankers at firms like PJT potentially earning $100K+ more than those at the bulge bracket banks.

Bonuses at this level tend to be ~65 – 80% of base salaries, with a few outliers above and below that range.

This percentage increases as you move from 1^st to 3^rd Year Associate, so your compensation becomes more dependent on deal activity over time.

Investment Banker Salary and Bonus Levels: Vice Presidents

I feel less confident about the numbers presented here for VP-level bankers because, frankly, I couldn’t find that much specific data.

The numbers I found were all over the place, with certain firms paying VPs more like Associates, and others, like PJT, offering outsized pay in some cases (e.g., $750K total compensation for 2^nd Year VPs).

So, I’ve made rough estimates above, but feel free to chime in if you have better data or a more reliable compensation report.

Investment Banker Salary and Bonus Levels: Directors

I found even less data for Director-level bankers, but I think it’s fair to assume a ~10% increase in total compensation, which explains my $600K – $800K range above.

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

Investment Banker Salary and Bonus Levels: Managing Directors

If you plotted the total compensation for each position in the investment banking career path against deal activity, Managing Directors would have the highest “Beta.”

When deal activity and fees are up, they benefit the most, and when they fall, they also take the most damage. In truly terrible years, some MDs could earn $0 bonuses!

This is why you see articles and press releases touting pay increases of 23% or 20% at certain banks – most of that increase goes to the MDs.

For this past year, it’s fair to say that most “junior MDs” were probably just around the $1M total compensation level, with higher/lower numbers depending on closed deals.

More senior MDs, such as Group Heads, could earn a multiple of that.

Besides the high bonus fluctuations at this level, the other caveat is that 30%+ of bonuses are deferred or paid in stock.

Regional Differences and London Numbers

Unfortunately, I couldn’t find great reports from the usual suspects (Arkesden and Dartmouth) for this past year in London.

eFinancialCareers ran a summary of 2024 Analyst compensation a few months ago, which seems fine for base salaries but lacks detailed bonus breakouts.

If we take these numbers at face value, base salaries progress upward from £70K to £90K GBP, and the median bonus is £40K.

That equates to a total compensation range of ~$135K to ~$160K USD, which seems low, even by London standards.

This report is probably lowballing the bonus numbers since they don’t separate them by level, so I would assume the upper part of the total compensation range is closer to $180K USD, for a range of more like $135K to $180K USD (close to the numbers mentioned in the article).

This is about a 15% discount to NY total compensation, which is within the normal 15 – 30% discount in London.

This discount normally persists as you move up the ladder, but again, I don’t have firm numbers for other levels this year.

And no, sorry, there’s even less data for Asia, Australia, or other regions.

So, What Does This Mean for Future Investment Banker Salaries and Bonuses?

In last year’s report, I predicted an increase in deal activity and a 10 – 15% increase in bonuses.

Bonuses increased by more than that, but total compensation increased by 10 – 15% across most levels.

I predict almost no change this year because of all the uncertainties around trade, interest rates, inflation, Trump’s random social media postings, DOGE, antitrust, etc.

I could see a +10% to –10% difference in total compensation, but I have no idea if this will be a “plus” or “minus.”

On a long-term career basis, I think it’s hard to make a case for the bulge bracket banks over the elite boutiques now.

You can earn significantly more at the EBs, do more interesting work, and still have very good exit opportunities.

You could argue that it’s still better to start as an Analyst at one of the bulge brackets for the brand name and network, but they seem much less compelling at the Associate level and above.

Some people argue that it’s tougher to build your client base at an EB if you’re aiming to become a Managing Director there, and there is some truth to this.

But I’m not sure this is a great argument because most people never make it to the top, and even if they do, MDs switch firms and move around all the time.

I’ll conclude this year’s bonus report with a bit of a warning message.

You might look at these numbers and think, “Sure, the job is stressful with long hours, but if I can make it to the top, I can earn a high income, ‘coast,’ and save up for an early retirement.”

Even as an MD, investment banking is NOT an easy job, and you will not be able to “coast” unless you are amazingly talented, lucky, or extremely senior.

MDs are under constant pressure to generate fees, so turnover at this level is also quite high.

Career longevity is also an issue: If you spend 10 years in the role, and then an up-and-coming junior MD offers to bring in the same deal volume for a lower bonus, do you think the bank will keep you around?

I’m not advising you to avoid the industry – just to temper your expectations.

Some bankers stay in the role for decades and become quite wealthy, but others burn out or quit for corporate/other roles – which can be a problem after many years of lifestyle creep.

And unless 2021 bonuses return or banks accelerate their promotion schedules, I don’t think this will change anytime soon.