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A statistical guide to the annus horribilis for investment banking

Now that you’re looking forward to 2013, sprucing up the CV and considering donning lycra for the cursory New Year resolutions, it’s time to reflect on 2012 – a year that many investment bankers would rather forget.

Amid all the redundancies, banker bashing, industry consolidation and general gloom, how bad was it really for the investment banking industry?  Here are some key stats for 2012.

$63.6bn: Total global investment banking revenue in 2012 – down 9% from the $69.6bn earned in 2011, according to Dealogic.

7.6%: The investment banking wallet share of J.P Morgan, the top bank by revenue in 2012, according to Dealogic. This is versus 8.1% in 2011 and 9% in 2009.

$335.4k: The average compensation paid per head among the top investment banks for 2011 performance, according to our analysis.

$3.2k: RBS’s bonus cash cap for bonuses paid in 2012, the lowest of any investment bank.

100,000: The number of investment banking layoffs gloomily predicted by Meredith Whitney in September.

40,000: The number of jobs either shed, or earmarked for cuts, in investment banking since mid-2011, according to Roland Berger Strategy Consultants.

4,300: The year-on-year global decline in front office ‘producer’ headcount in investment banking to Q3 2012, according to research firm Coalition.

$13.8bn: Revenues earned by investment banks’ financial institutions groups, which was the leading sector in 2012, according to Dealogic. This was flat on 2011.

249,512: The number of ‘City-type’ jobs in London in 2012, according to the Centre for Economics and Business Research. This is down nearly 31,000 year-on-year and over 100,000 since 2007.

21%: The year-on-year increase in investment banking revenues at RBC Capital markets, to $1.6bn. This was the biggest rise among any investment banks, according to Dealogic – all that hiring has done some good.

11,000: The number of jobs Citigroup said it was cutting in December.1,900 of these will come from Institutional Clients Group, which includes the investment bank.

$140k: The median compensation for MBAs from Harvard Business School entering investment banking this year. 95% of the class of 2012 joining the sector received a sign on bonus.

20%: The maximum percentage uplift in compensation expected for fixed income bankers in 2012, according to popular pay consultant Johnson Associates. This is compared to 5-15% for those in equities and -10%-+5% in investment banking.

$170k: The average global pay for third-year analysts in investment banking, according to research by headhunters Glocap.

92%: The proportion of bonuses deferred at RBS’s investment bank.

£6.4k: The predicted average ‘City’ bonus in 2012, according to the CEBR, down from £33k a year earlier.

200%: The increase in profits at Goldman Sachs, year-on-year, for the first nine months of 2012.

2: The number of days that Goldman’s trading desk lost money in the third quarter (versus six days in Q2).

12%: The year-on-year increase in investment banking revenues in South East Asia, to $1.6bn according to Dealogic, which was one of two regions to register a rise. The other was the Middle East and Africa, which posted revenues of $969m, or a 6% increase.

AUTHORPaul Clarke
  • An
    2 January 2013

    I am a 2nd year BB investment banking analyst, I think I need to get into contact with Glocap next year, I don't get paid enough!!! $$$

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