UBS Group AG boosted the 2017 bonus pool for its investment bankers in the Asia-Pacific region by about 6 percent, reflecting a rebound in dealmaking and efforts to retain junior staff focusing on China, according to people familiar with the matter.
Total compensation for junior bankers in the region rose by about 12 percent on average, the people said, asking not to be identified because the information is private. Some junior bankers focusing on China received raises of 15 percent to 20 percent as UBS seeks to reverse a series of defections to Chinese corporates and private equity firms, one of the people said.
UBS, like many of its competitors, is increasingly tilting bonus payouts toward the biggest revenue generators and younger bankers who might otherwise defect for other industries. The larger bonuses in Asia mark a reversal from the previous year, when the regional investment banking payout pool was cut by about 15 percent.
The average total compensation for senior managing directors in Asia-Pacific, including bonuses, was about $1.3 million for last year, the people said. UBS spokesman Rob Stewart declined to comment on the payouts.
UBS benefited from a revival in China equity and equity-related deals last year and a recovery in Australia in the second half, the people said. Those two markets have traditionally been UBS strongholds.
Pretax profit at UBS’s regional investment bank, which also houses brokerage operations, jumped 66 percent to 500 million Swiss francs ($532 million) in 2017, according to its latest earnings report. UBS’s ranking for Asia-Pacific equity offerings rose to third in 2017 from fifth a year earlier, data complied by Bloomberg show.
Even as profit rebounded, the bank suffered an exodus of China bankers last year, including Jiang Guorong, who was country head of corporate client solutions. Like other banks, UBS has also found it hard to retain China dealmakers who are being lured by potentially higher compensation at buyout funds.
At the same time, UBS hired at least 15 investment bankers in Asia last year, including Catherine Cai, who joined from Citigroup Inc. as executive vice chairman of Asia corporate client solutions.