Canada’s biggest banks posted the smallest average increase in bonus pools in three years as profit growth slowed.
Bloomberg reports that the six firms set aside $10.2bn for incentive compensation this year, 5% more than 2012 and the lowest increase since 2010, according to financial statements by the firms. Royal Bank of Canada led for a second straight year with a 7.5% hike, while National Bank of Canada was the only lender to reduce its allocation.
The banks may distribute more rewards to businesses such as wealth management that helped lift profits to record highs, while bankers in capital markets could get a smaller share as a slump in mining and energy deals sapped activity for most of country’s bank-owned investment banks, according to Bill Vlaad, president of Vlaad & Co., a recruitment firm that specializes in financial services.
'The investment banks have not been as strong as the personal and commercial and bricks-and-mortar business, so they’re going to have a smaller percentage of the pool than they did in years past', Vlaad said in a 6th December telephone interview.
The bonus projections for Canadian bank employees approximate those in the U.S. Wall Street bankers can expect 'moderately larger' year-end incentive payouts compared with 2012, with the biggest increases skewing to those in asset and wealth management, Johnson Associates, a compensation-consulting firm, said in a 7th November report.
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