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Up to 20% Bonus Increases for Wall Street Rates Traders

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Proving it to be the best time to be a rates trader on Wall Street, JPMorgan Chase & Co., the world’s biggest investment bank by revenue, boosted its 2016 bonus pool for traders dealing in government bonds, swaps, and other assets tied to interest rates by about 20%. According to the people with knowledge of the matter who asked not to be identified discussing compensation. At Morgan Stanley, the bonus pool for rates traders climbed more than 10 percent, and at Bank of America Corp., the average bonus for those employees increased more than 10 percent, according to others.

It’s been since 2012 that Bond traders got their first pay bump, after political events set off a frenzy of transactions the previous year, even as pressure to keep compensation in check still rules at investment banks, especially at struggling European firms. The rates trading in particular accelerated a 15 percent increase in fixed-income revenue at the five biggest Wall Street banks. This boost came late in the year when the U.S. election roiled expectations for interest rates and economic growth.

Rates traders beat most of their peers in fixed income. Just for an example, at JPMorgan the bonus pool for credit traders rose by 10 percent, according to research. It is declared that employees will get their compensation this month and receive the awards in February.

But yes, not all of the banks took part in the rates-trading party. It is expected that the broader rebound in fixed-income revenue can continue in 2017. As per the statement of Morgan Stanley, Chief Financial Officer Jonathan Pruzan that this month that momentum from a strong fourth quarter is continuing at the start of the year as clients reposition portfolios and put cash to work.



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