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2d ago

Wall Street Bonuses Face Decline as Trade Uncertainty Stalls Dealmaking

Johnson Associates projects bonuses for investment bankers could drop by up to 20% in 2025, while trading desks may see gains from market volatility.

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A view shows the New York Stock Exchange (NYSE) Wall Street entrance in New York City, U.S., April 7, 2025. REUTERS/Kylie Cooper/File Photo

Overview

  • Johnson Associates predicts Wall Street bonuses could decrease by 5% to 10%, with a worst-case scenario of a 20% decline if economic conditions worsen.
  • Investment banking and equity underwriting bonuses are expected to see the steepest cuts, with declines of up to 20% due to a freeze in corporate transactions.
  • April 2025 marked the lowest global M&A activity in over 20 years, with just 555 deals announced in the U.S., the fewest since May 2009.
  • Market volatility has boosted trading activity, potentially increasing bonuses for equity traders by up to 25% and fixed-income traders by up to 20%.
  • The slowdown in dealmaking is attributed to uncertainty surrounding President Donald Trump's tariff policies, which have disrupted corporate confidence and planning.