Press Releases

Options Group Releases 2007/8 Global Financial Market Overview and Compensation Report

Multi-Billion Credit Crunch Pushes Annual Bonuses Down 5 to 10% Globally

New York, November 16, 2007 - Options Group, a leading global executive search and strategic consulting firm, released its annual survey on financial market trends and compensation patterns at global investment banks. The results of the 2007/8 Global Financial Market Overview and Compensation Report indicate that while mortgage-backed securities and structured credit professionals will receive significantly lower bonus payouts, equity derivatives sales and traders, investment bankers, prime brokers and commodities traders will earn record bonus payouts this year. Highlights include:

• Mortgage and credit-related professionals are set to receive as much as a 50% drop in bonuses, and most U.S. and European fixed income desks could be down 30% or more due to the credit crunch.Fixed income desks will be down 15 to 20% globally on average.
• Investment bankers should receive bonus packages 10% higher than in 2006 after a record year in M&A. European and Asian equity underwriters also should make record bonuses as investors there clamored for new issues.
• Equity Cash and Equity Derivatives salespersons, traders and structurers are set to earn 10 to 15% more on average in bonuses than they did in 2006.
• Commodity salespersons and traders will receive bonuses 15 to 20% higher than in 2006 as global demand for all kinds of commodity products increases exponentially.
• Asian financial services professionals will be the only earn the largest percentage bonus increases on average for the third straight year (flat to up 5%). European bankers, salespersons and traders will receive 5 to 10% lower bonuses and in the Americas, professionals will earn bonuses 10 to 15% lower on average than last year at the top-tier firms.

"Options Group has a built-in demand from our clients to continue producing rigorous market intelligence on financial trends and compensation for the global markets," said Michael Karp, CEO of Options Group. "The firm continues to grow into emerging markets such as Brazil, China, India and Russia to meet this growing demand for real-time data and information globally."

Options Group also is releasing its Top 10 Trends for the Global Financial Markets in 2008. Highlights include:

Emerging markets such as Dubai, Shanghai, Moscow, Toronto and Sao Paulo will soon be considered the most important priority for global investment banks as they seek to offset declining domestic profits. Banks are expanding beyond sovereign debt to equities, structured products and origination. Professionals born in these countries ("ex-pats") are increasingly heading back home to take advantage of this multi-year trend.

U.S. banks, already reeling from billion-dollar-plus write-downs, also have a currency exchange issue. The weakening dollar means bonus payouts in EMEA and Asia-Pacific (as well as Canada) are significantly more expensive than last year. Strong profit growth in non-U.S. and European markets, however, means global investment banks have to continue investing in these regions.

Hiring managers will have to raise the stock component significantly on 2007 bonuses as a way to retain staff and motivate top performers not to migrate to other firms. UBS is capping cash compensation at $750,000 this year and stock payouts could reach as high as 75% of total bonus payouts at under-performing banks this year.

Lower fixed income bonuses, especially at banks hardest hit by the credit crunch, will push a lot of top salespeople and traders into the job market in early 2008.

All estimated bonuses mentioned are the average amount global investment bank professionals are expected to make in 2007 based on information captured by Options Group. Options Group also can send reporters specific compensation numbers by position and product category if needed.

About Options Group

Options Group is a leading global executive search, market intelligence and strategic consulting firm with a focus on the financial services industry. Founded in 1992, Options Group has always prioritized maintaining an intimate relationship with the financial services industry and its key participants. Our geographic reach continues to expand to cover both established and emerging markets in the Americas, Europe and Asia. Since 2000, our seasoned search consultants have placed thousands of experienced financial services professionals in Global Markets, Alternative Investments/Hedge Funds, Investment Banking, Quantitative Research and Technology.