Investment Banking Associate Salary Guide

Average Base and Bonus Salaries for Investment Banking Associates

Table of Contents

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Investment Banking Associate Salary in New York
Stub-Year Associates
Investment Banking Associate Salary in London and Europe
Variable Associate Bonuses

Investment banking associates tend to be hired after business school, after they have completed summer associate MBA internships.

Alternatively, some associates are internally promoted analysts that decided to remain at the firm, rather than exiting to the buy-side – or lateral hires from other investment banks.

The investment banking associate salary is comprised of two parts:

Base Salary: For a first-year investment banking associate in New York City, the base salary is $150,000.
Bonus: Associates will receive a year-end bonus in the range of $90,000 to $120,000. But the absolute top performers can get a bonus as high as $130,000.

The all-in comp for most 1st year associates thus comes to around $240,000 to $270,000.

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For competitive reasons, base salaries are fairly standard during all 3 associate years at most investment banks:

Year 1: $150k
Year 2: $175k
Year 3: $200k

Meanwhile, bonus disparity based on associate performance grows over time.

The all-in comp is usually a bit lower at large middle-market investment banks but can get considerably lower at small regional firms outside of New York. Elite boutiques generally pay in line or better than bulge brackets.

The table below summarizes the average compensation for stub year, 1st year, 2nd year, and 3rd-year associates.

Investment Banking Associate Salary in New York

Position	Base Salary	Bonus	All-In Comp
Stub-Year Associate	$150,000 (pro-rated for stub) Up to $60,000 signing / relocation bonuses Lower at smaller regional middle-market firms	$30,000 to $40,000 stub bonus paid in Jan/Feb Bonus has less variance than in later years because there hasn’t been enough time yet to gauge associate performance	NM
1st Year Associate	$150,000 Adjust down a bit at smaller regional middle-market firms	Low: $90,000 Mid: $110,000 High: $130,000	$240,000 to $270,000
2nd Year Associate	$175,000 Some going to $200,000 but in lieu of lower bonus	Low: $100,000 Mid: $140,000 to $180,000 High: $215,000	$275,000 to $390,000
3rd Year Associate	$200,000 Some going to $225,000 in lieu of lower bonus	Low: $120,000 Mid: $180,000 to $220,000 High: $250,000	$320,000 to $450,000

Stub-Year Associates

Note that associates usually arrive during the summer after completing business school.

Instead of paying the bonus 12 months after the typical start date, banks pay associates (and analysts) their bonus for just their first 5 months (“stub bonus”) to reset them to a December 31 calendar year-end.

Bonuses for the prior year are usually communicated in January and February (i.e. “bonus season”).

Investment Banking Associate Salary in London and Europe

As is the case in the United States, investment banking associate base salaries in London/Europe do not vary too much from firm to firm.

Stub-Year: £80k
Year 1: £95k
Year 2: £105k
Year 3: £120k

As you can see from the table below, some bonus disparity exists across firms as well as based on associate performance. All-in comp is usually a bit lower at large middle-market investment banks, and slightly higher or in line to bulge brackets at Elite boutiques.

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Position	Base Salary	Bonus	All-In Comp
Stub Year Associate	£80,000 is the “standard” Up to £30,000 signing bonus	£25,000 to £30,000 stub bonus paid in Jan/Feb	£105,000 to £110,000 (excluding signing bonus)
1st Year Associate	£95,000 is the “standard”	Low: £60,000 Mid: £70,000 High: £85,000	£160,000 to £165,000
2nd Year Associate	£105,000	Low: £85,000 Mid: £95,000 High: £110,000	£190,000 to £215,000
3rd Year Associate	£120,000	Low: £90,000 Mid: £110,000 High: £130,000	£210,000 to £250,000

Variable Associate Bonuses

Similar to the analyst compensation structure, the bonus component is a function of:

Individual Performance
Group Performance
Firm Performance

What this means is that you could be a rock star, but if your group/firm is not closing deals and bringing in revenue, your bonus component will still suffer.

Unfortunately, even during times when deals are not happening, the workload doesn’t necessarily die down.

You are always pitching with the aim of closing deals even in bad markets, so in slower economic cycles when bonuses decline across the board, being an investment banker becomes less appealing given the consistently grueling hours.