Credit, Risk & Quantitative Finance 2016 Salary Guide

Sam Turner 25.02.2016

At Morgan McKinley, we endeavor to provide up-to-date market insight and expert knowledge on your sector. Here we offer key recruiter information across Credit, Risk and Quantitative Finance, covering permanent and temporary salaries across London and South West England.

London

Leap in salaries at AVP level

Over the past 12 months there has been an uplift in recruitment for credit analysis in response to increased trading activity. Candidates with exposure to FTSE 100-250 corporates and leveraged deal experience are in demand. Within market risk, stress testing has been a major focus as a result of regulatory pressures, with reduced emphasis on straight-line market risk analysis, such as looking at asset classes. In terms of seniority, most recruitment has been at the middle level (AVP to VP) with less activity at the Director or Analyst level. Salaries in this space have increased significantly. Movement in 2016 will continue to be more driven by career progression.

High-quality candidates have been motivated to move to advance their medium-term career prospects rather than in pursuit of higher salaries, although there is frustration at the lack of opportunities at Director level. 

Greater technical focus

Contract recruiting has been largely driven by regulatory requirements. The changes under the fundamental review of the Trading Book (FRTB) under Basel IV was to be finalised by 2017, yet this now appears to be being delayed and therefore, there shall be less of an emphasis on this regulatory requirement. Some banks have started early to try and get ahead in terms of running quantitative impact studies (QIS) and working out how to make methodology changes for expected shortfall and the regulatory driven stress tests. Yet budget relating to FRTB should now be reduced. Where we might see an increase in hiring shall be on the requirements from the regulators to perform intra-day stress testing. However this may prove to be a huge headache for the banks.

Unlike the permanent recruitment market, there has been low demand for credit analysis on the contract side will. Credit analysis is the only area within risk where companies pay considerably more to permanent staff than contractors. The contract work tends to be focused on annual reviews of portfolios, whereas on the permanent side it is much more technically challenging and closer to a revenue generating role.

Operational risk seems to be on the increase with a greater focus on loss data and the higher regulatory capital requirements relating to operational risk losses. There is more of a definition around the three lines of defence model and an increase in internal audit and controls testing from the point of view of making the functions more robust.

The sheer speed of the regulatory changes and technological landscape is making it difficult to match existing skill sets to the new needs. Hiring organisations will therefore often look to recruit at a more junior level. However, they onlyconsider candidates with superb academic qualifications who can adapt quickly to the wide range of software tools and new programming languages, which are used to perform a variety of analyses and simulations. In general, the contract market is becoming more and more technically focused. There have only been moderate increases in daily rates over the last year which will follow on into 2016.

Permanent - London
Basic Salary (£ Per Annum)
Role Analyst
0-2 Years
AVP
 3-4 Years
VP
5-7 Years
Director
8-9 Years
MD
10+ Years
Market Risk Management 40,000-50,000 55,000-80,000 80,000-120,000 120,000-160,000 175,000+
Market Risk Control 40,000-50,000 50,000-75,000 75,000-120,000 125,000-175,000 150,000+
Investment / Portfolio Risk 40,000-55,000 55,000-75,000 75,000-110,000 115,000-150,000 150,000+
Credit Analysis 40,000-50,000 50,000-75,000 75,000-120,000 125,000-175,000 150,000+
Credit Risk Control 40,000-50,000 50,000-65,000 70,000-100,000 100,000-130,000 130,000+
Operational Risk Management 40,000-50,000 50,000-80,000 80,000-120,000 120,000-160,000 160,000+
Quantitative Risk Analysis 50,000-65,000 60,000-80,000 80,000-130,000 120,000-160,000 175,000+
Temporary - London
Rate (£ Per Day)
Role Analyst
0-2 Years
AVP
3-4 Years
VP
5-7 Years
Director
8-9 Years
MD
10+ Years
Market Risk Management 200-250 250-450 450-600 600-750 750-1,000
Market Risk Control 150-200 200-300 300-400 400-500 500-750
Investment / Portfolio Risk 200-250 250-450 450-600 600-750 750-1,000
Credit Analysis 150-200 200-250 250-300 300-450 450-600
Credit Risk Control 150-200 200-300 300-400 400-500 500-750
Operational Risk Management 200-250 250-450 450-550 550-600 600-700
Quantitative Risk Analysis 200-250 250-450 450-600 600-750 750-1,000

South West England

Upward pressure on salaries

General risk is a growing market in the South West with demand for candidates who have a broad range of skills in general risk and control, credit risk, market risk and operational risk. Anyone with regulatory knowledge and/or experience in SAS risk modelling, in particular, will have no trouble finding a role and salaries are being driven upwards. Some financial services companies are looking to move back office functions out of London to reduce costs, so we expect the demand to increase and there will be more opportunities for specialists.

Permanent - South West
Basic Salary (£ Per Annum)
Role Analyst
 0-2 Years
AVP
3-4 Years
VP
5-7 Years
Director
8-9 Years
MD
10+ Years
Risk and Control 20,000-27,000 27,000-35,000 35,000-50,000 50,000-70,000 70,000-85,000
Credit Risk 20,000-30,000 30,000-38,000 38,000-50,000 50,000-70,000 70,000-100,000
Operational Risk 18,000-25,000 25,000-35,000 35,000-45,000 45,000-65,000 65,000-90,000
Market Risk 20,000-30,000 30,000-38,000 38,000-50,000 50,000-70,000 70,000-100,000
Sam Turner's picture
Principal Consultant
sturner@morganmckinley.co.uk