Banker Bonuses Expected to Slump 20% as Tariff Chaos Hits Deals

Trader payouts are predicted to surge as banks cut bonuses for investment bankers

ECM banker payouts could decline between 10% and 20%, while M&A dealmakers are expected to see a decrease of between 5% and 10%.

By contrast, the market volatility from the policy changes has seen equity traders enjoy record revenues in the first quarter at both Wall Street and European banks.

Johnson Associates predicts a bonus increase of up to 25% for equity trading professionals this year, with those in fixed income roles expected to see rises of up to 20%.

“Surging trading results across major market makers and non-bank trading firms are fueling demand for top talent, and we expect incentives for bank traders to trend higher—even as other business segments see more sluggish performance,” said Chris Connors, a principal at Johnson Associates.

“Banks recognize they need to stay competitive to retain high-performing trading talent.”

“If tariffs continue to stymie dealmaking, we do expect it to impact both compensation and staffing levels,” added Connors.

“Banks will move to right-size teams to align with business volumes. M&A bankers are on pins and needles, waiting to see if a resolution unlocks client activity—until then, uncertainty is driving caution in pay planning and hiring.”

Financial News / May 8, 2025