Canada’s largest banks set aside nine per cent more on average for bonuses in fiscal 2023 than they did a year earlier, with increases at all six companies despite a broadly disappointing year for dealmaking.
That increase is somewhat at odds with the mood on Bay Street, according to Bill Vlaad, managing partner and chief executive officer of Toronto-based recruitment firm Vlaad & Co., who called the equities market of the past six months “abysmal” and said most people in the capital-markets business have been bracing for much lower bonuses.
“We’re getting early indications and people are getting hammered,” he said in an interview Friday, noting that many people his firm speaks with have been saying for months they expected a bad year for bonuses.
Employees in other divisions, such as wealth management, insurance and asset management, also receive variable compensation on top of their base salaries, and those payouts are included in the overall numbers the banks report, which are not broken down by business line.
But capital-markets professionals — including investment bankers, analysts, salespeople and traders — typically count on a much larger portion of their take-home pay coming from bonuses. Capital-markets employees don’t account for the majority of employees at many banks, so lower bonuses in those businesses may not drag down the overall numbers, Vlaad said.
Incentive pay at Canadian banks — which doesn’t include base salaries — is based on performance, and the figures the firms report reflect the amount reserved, not paid out. The fiscal year ended on Oct. 31, but bonuses are typically distributed in December.
Those figures range from a very small increase at National Bank of Canada to a whopping 23.1 per cent
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