What I-Banks Now Pay Starting MBAs

And compensation is only one facet of these firms’ wholistic approach. One recent Wall Street Oasis review touted Evercore’s intangibles. “[The] best aspects of working at Evercore are the culture, the level of responsibility given to junior people and the amount of exposure you get to senior bankers and clients.”  Another recent review from Blackstone’s mergers and acquisitions arm touted management’s “openness” and accessibility. “Calls from lower level analysts and associates are answered by management, who is always there.”

EVERYONE IN THE TOP 30 IS A WINNER

While Blackstone and Evercore rank at 99.8 and 99.5 of percentile, Curtis cautions that any firm making the top 30 provides strong compensation. In fact, the top 26 firms all ranked within the 91st percentile or better. In fact, only 2.5 percentile points separate #1 Blackstone Group from #12 Houlihan Lokey (and only 5.0 percentile points differentiate #13 Wells Fargo and #25 Deutsche Bank).

Even more, actual earnings don’t necessarily align with members’ perceptions.  For example, #8 Piper Jaffray offers the highest median bonus to first year associates at $125K, followed by #30 Macquarie Group Limited ABN ($122K) and #29 Rothschild ($120K). Not to mention, Rothschild and #16 Lazard also equaled #2 Evercore in furnishing the highest median base salaries ($130K) among first year associates. Not to mention, $120K (or more) bases could be had at #3 Harris Williams & Company, #7 BMO Capital Markets, #16 Barclays Capital, #18 Credit Suisse, #20 Societe Generale, and #30 Macquarie.

Harris Williams & Company, renowned for their coaching and training, also ranked #3, percentile-wise, for compensation. They were followed by Moelis & Company, JPMorgan Chase, Goldman Sachs, BMO Capital Markets, and Piper Jaffray. CIBC World Markets and William Blair rounded out the top 10.

Wall Street Oasis’ percentiles also provide a counterpoint to Vault’s 2014 rankings of investment banking compensation, which was based on a ten point scale. Here, Centerview Partners topped the list followed by Houlihan Lokey and the Peter J. Solomon Company. Blackstone Group, which had the highest percentile according to Wall Street Oasis, ranked fourth, with Evercore coming in sixth.

FUTURE PREDICTIONS

So what firms should we look out for in the coming year? While Curtis is careful not to disclose his favorites, he notes that a major shift has occurred in recent years. “I would say that since the financial crisis, some of the bulge brackets were hit harder compared to some of the elite boutiques since these smaller banks were largely insulated from CDOs and the MBS mess.  The base salary is fairly standardized across BBs and elite boutiques, with every little variability, so what really makes the difference (at least at the junior ranks) are the bonuses.”

However, this could potentially change in the coming year. “Now that the economy is healthier,” Curtis observes, “I’m more curious whether the bulge brackets will regain their leading spot…they still have a “prestige” edge compared to most elite boutiques, but within the industry, that has shifted slightly over the past 5 years.”

Despite these changes, Curtis, a Wharton MBA, encourages MBAs to start in the bulge bracket. “I still think starting at a BB out of MBA is one of the best places, as long as you are careful what BB.  Some in 2010-2013 were known for weaker bonuses because of the weaker economy and new regulations, although most are now on much stronger footing and still landing big deals.”

To see first-year average compensation at the top 30 firms for associates and analysts (along with median base salaries and bonus), go to the next page.

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