Morgan Stanley's bonus payouts for star Asia bankers to jump by up to 50%

Hong Kong: Morgan Stanley's top-performing investment bankers and traders in Asia will see up to a 50 per cent increase in bonuses due to robust business growth and a low-base effect of last year, according to two people with direct knowledge of the matter.

The jump in the bonus payouts in the region will come after the Wall Street firm saw its new CEO Ted Pick wrap up a strong first year, and it benefited from buoyant trading activities in the Asia Pacific region.

The revenue of the bank's institutional equities business, one key part of its sales and trading, rose by 51 per cent globally in the fourth quarter compared with a year ago, with the Asia business providing a strong boost to the global growth, the bank said earlier this month.

Top Wall Street banks including Morgan Stanley are seeing big bonus increases in Asia for traders this year due to buoyant client activities last year, according to one of the people.

Morgan Stanley, which is among Asia's largest equities deal fee earners, has told some top bankers in Asia their bonuses will be around 40% higher this year compared to 2024, the two people said.

Higher bonus payouts help investment banks to retain their top dealmakers, and the move is particularly crucial in Asia where they have seen layoffs over the past few years.

The sources declined to be named as they were not authorised to speak to the media.

A Morgan Stanley spokesperson in Hong Kong declined to comment. Investment banks typically never publicise the quantum of bonuses handed out to dealmakers and traders.

Bloomberg, citing sources with knowledge, reported on Monday that some senior Morgan Stanley bankers, particularly those who worked on India and Australia deals, are going to see an increase of 30% to 40% in bonus payouts this year.

Morgan Stanley ranked second last year in investment banking revenue both in the APAC international and Japan regions, according to Dealogic data. It collected $355 million in fees in APAC, trailing JPMorgan, and garnered $511 million in Japan, where it trailed Nomura, the data showed.

A jump in Morgan Stanley bonuses would come off a low base last year when the most senior dealmakers saw their bonus fall by more than 20% from a year ago, one of the people said.

Close to one-third of managing directors did not get any bonus in Asia last year, the person said.