Investment banks are poised to step up hiring and raise bonuses within their markets’ businesses as they reap the benefits of a sustained uplift in trading revenue. Banks are likely to allocate higher budgets to expand their roster of senior traders and award bigger payments this year, according to London-based head hunters and executives.
“I think it is going to be a little bit like post-Covid in 2021, or maybe even going back to 2009, 2010, when things were very robust on that front,” said Canice Hogan, chiel executive of macro focused executive search firm Shadowbound.
Banks’ total market revenue for last year is expected to reach $259 billion –the highest figure since 2009, according to research firm Crisil Coalition Greenwich.
“Many people are quite excited about 2026,” said one trading executive at a European investment bank. “What’s going on globally and geopolitically has made this year a very interesting space, and I think we can expect that to continue.
Equities has been a stand-out asset class for banks last year. Annual revenue from the area is projected to gain 17 per cent to a record $94bn, helped by an AI stock boom and a surge in demand for prime broking services among banks, hedge fund clients.
Macro traders are also eyeing a strong 2026. This year’s haul from fixed income, currencies and commodities is projected to hit $165bn –the highest figure since 2009, according to Coalition Greenwich. Fixed income is more reliant on human traders than equities, where the vast majority of deals are made electronically.
“Rates generally have been quite volatile, particularly inflation and interest rates – there’s been opportunity to make money there,” said Kumaran Surenthirathas, managing director at fixed income-focused headhunting firm Rosehill Search. “Probably the other main area of expansion is the private markets space, private credit in particular”.
Hogan cited a “shortage of senior people” at banks as a possible driver for hiring in fixed income. “Teams are smaller and there’s less of a bench almost everywhere since the hedge funds have been very active lifting out of the banks.”
The potential for strong trading revenue across the sector could create a “perfect storm”, according to Hogan, as big banks, their smaller rivals and the booming hedge fund industry all vie for senior talent.
Bank of America and Nomura are among firms to lose senior macro traders in London to hedge funds over past year,” according to reports. “The sell-side talent pool is getting strained buy the buy-side,” said one European markets executive at a large US bank.
“Rising trading revenues don’t just lift bonuses –they accelerate mobility,” said Joseph Leung, managing partner at executive search firm Aubreck Leung. He added: “As top performers jump to rivals and the buyside, banks face gaps they must move quickly to fill or they’ll hand their competitors an open lane.”
Year-end bonuses for equities sales and trading professionals are projected to rise by 15 per cent to 25 per cent, compared with 5 per cent to 15 per cent in fixed income, according to a November report by Wall Street compensation consultants Johnson Associates.
“Bonuses won’t be in line with (profit and loss), but the main players could be 5 to 10 per cent higher depending on which area you are in,” Hogan said on fixed income. “If you’re in rates you probably could be 8 per cent to 10 per cent up. If you’re in FX it might be 3 per cent to 5 per cent.
Oman Observer is now on the WhatsApp channel. Click here
