Asset manager remuneration increased by an average of 18% over the last year and company salary bills increased by an average of 4%, according to PriceWaterhouse Coopers.
The consultancy says competition for asset managers has seen remuneration increase for a second successive year as pressures to attract and retain talent return, yet regulation threatens to impact expansion in growing markets.
On average, the compensation as a percentage of net revenues was 42%, the same level seen last year, and bonus costs as a percentage of pre-bonus operating profit were 34%, down from 38%.
Tim Wright, remuneration director, says there is a “noticeable differentiation” this year with fund managers benefitting more than sales staff.
“This reflects pressure in the markets; fund managers have performed to protect and grow the investments they have, exactly what they are measured against, but market uncertainty resulted in pockets of poor sales activity which affected sales related incentives,” he says. “It has been tough to bring new assets through the door and the focus was on retaining existing money, trying to stem the tide.”
The report also highlights worries firms have about the EU Capital Requirements Directive, which is beginning to have practical implications for European-headquartered asset managers. Of those surveyed, 85% said they were concerned about the new rules and report difficulties competing for investment professionals in growing markets.
©2011 funds europe