Across the top five US banks, ECM revenue was up 87% in the April–June quarter from a year earlier and was up 68% for the first half of the year
Philip Scipio | IFR
Record revenue for banks in equities trading could translate into record bonuses for equities traders in the next bonus season, according to pay analysis firm Johnson Associates.
Incentive pay for equity traders for 2026 could rise between 20% and 30%, Johnson said in its latest compensation report. Bonuses for 2026 are paid out in early 2027, typically February and March.
Johnson forecast that bankers in equity capital markets can expect the same level of pay increase, especially if the rebound in IPOs continues in the second half of the year.
Those bullish forecasts track the performance of top banks in the first half of the year. Across the five biggest US banks, including Goldman Sachs, Morgan Stanley and JP Morgan, revenue from equities trading was up a whopping 48% from a year earlier in aggregate in the first six months. All five banks reported record revenue in the second quarter, citing volatility and heightened engagement as key drivers of revenue gains.
Across the top five US banks, ECM revenue was up 87% in the April–June quarter from a year earlier and was up 68% for the first half of the year.
Bonus prospects are bright across most areas of banking and financial markets. Fixed income, currency and commodities traders could see incentive pay for 2026 rise 7.5% to 12.5%, according to Johnson. Across the top five banks, revenue from FICC trading was up about 11% in the first six months of the year.
M&A Boom
Investment bankers in M&A advisory are in line for bonuses for this year rising 15% to 20%, Johnson forecast.
That comes as M&A transactions hit a record pace in the second quarter. Revenue from advisory was up 27% in the second quarter and up 43% for the first half of the year across the top banks.
Independent banks, including Evercore, Lazard and PJT Partners, underperformed bulge-bracket peers in the quarter and first half of the year with advisory revenue rising 7% and 23%, respectively.
Johnson expects debt underwriting bankers could see bonus pay for 2025 rise 5% to 10% from last year as debt issuance continues to trend higher on refinancing needs. DCM revenue across the top five US banks was up 25% for the first half.
Source: IFR
