Options traders top pay bracket

UK forex options dealers raked in the largest pay packets this year, with total packages averaging more than £500,000, according to a survey by City-based executive search firm, Napier Scott.

Higher salaries were paid as banks tried to hold on to staff, according to the firm. It noted that it was a good year for rates and forex staff, with options traders having faired particularly well. "Forex and interest rate options [traders] were quite well taken care of this year pay wise, whereas last year I don't think the same could necessarily be said," said a consultant at the company who declined to be named.

"Some of the banks paid for that by a lot of troop movements," he added. "Certain bulge-bracket banks in particular lost more people than they would have normally, and it was down to that. So they made sure that didn't happen this year."

Senior vice-president, director-level options traders received a total package of £510,000, while forward and spot traders of the same level received packages of £410,000 and £310,000 respectively at top-tier banks. At second- and third-tier banks, forex options senior vice-presidents and directors earned £510,000 and £410,000 respectively.

A London-based headhunter noted that structurers were also looked after because they are seen as the most valuable asset. "This is where banks can add value, especially to corporates. They help with the selling of complex derivatives and can help with complex issues such as IAS 39," she said.

Renate Paxton, consultant at Napier Scott, added that sales staff had all experienced a hike in pay packets this year. She said some top-tier houses paid bonuses strictly by performance-rewarding those with strong results. These banks raised packages by 30% to 40% for top performers – and lowered them by a similar amount for those bringing in the least business.

Inflation in job titles as well as pay packets was also a factor according to another London-based headhunter. She said CSFB handed out 140 managing director titles to keep people happy.

For distribution, hedge fund sales staff received the largest packages. Senior vice-president director-level hedge fund sales staff were paid a total of £420,000 at first- and second-tier banks, and £360,000 at third-tier banks.

Another London-based headhunter noted that bonuses were mixed for sales staff, where the best were paid well. "The best being those who have extra skills, such as e-skills, languages, structuring knowledge for example," she said.

"It is becoming very tight in this space so sales staff will find they need to work harder to earn the money they did the year before."