Feb 1, 2023
Barclays Fixed-Income Traders May Be a Getting 15% Bonus Increase
(Bloomberg) -- Barclays Plc is weighing an increase in the bonus pool for its fixed income trading division, with the unit expected to produce record revenue after 2022’s wild market swings.
The British bank is considering boosting the overall incentive compensation for fixed income traders by as much as 15%, according to people familiar with the matter. The proposals are still under discussion and could change.
Equities trading, which suffered from a decline in derivatives activity last year, might see its overall compensation pot drop as much as 10%, two of the people said, asking not to be identified discussing private matters. Like other Wall Street firms, Barclays is considering cutting bonus pools for their investment bankers by as much as 40% amid a dealmaking slump, the people said.
A spokeswoman for Barclays declined to comment.
Barclays is also among firms — including Goldman Sachs Group Inc., Bank of America Corp. and Citigroup Inc. — considering giving some of their lowest performers no bonus at all — known as getting “zeroed out,” receiving a “goose egg” or “bagel.”
Read More: JPMorgan, BofA, Citi Slash Banker Bonuses as Talent War Ends
Barclays’s fixed-income traders are expected to report their best year ever when the bank publishes fourth-quarter results later this month. The unit’s revenues are anticipated to surge 49% to $7.07 billion for the year, according to analyst estimates compiled by Bloomberg.
That would top the record set in 2020 when the pandemic fueled a surge in client activity and volatility.
Under Chief Executive Officer C.S. Venkatakrishnan, Barclays has been investing in the firm’s prime brokerage business, which offers hedge funds and other asset managers financing for products including equities, fixed-income and foreign exchange. As part of the focus, Barclays last year hired 18 people from Credit Suisse Group AG.
Those investments helped fuel the increase in revenues last year. The company is also looking to grow its business dedicated to trading securitized products, mortgages and treasuries, Venkatakrishnan said last year.
Read More: Barclays CEO Says You Won’t See Him Spin Out Investment Bank
Barclays last year hired Carl Scott from Citadel Securities to run its European, Middle East and African interest rates trading business. The company also added Deutsche Bank AG’s Dan Orlando as head of US rates trading in New York.
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