- Investment-banking MD base pay has been flat for years at roughly US$400k globally, lower in North America and higher in Europe/UK.
- Post-Brexit loosening of bonus caps is shifting compensation back toward variable pay, with banks setting much higher internal bonus limits.
- In strong years like 2024, bonuses for top MDs and Material Risk Takers drove average total pay in the UK/EU to around £1.5m–€1.8m at some banks.
- Despite big headline totals, high taxes, cost of living, and bonus volatility leave some MDs feeling financially stretched.
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The recently published article from eFinancialCareers (November 12, 2025) confirms that MD fixed salaries in investment banking have remained largely unchanged for several years. It reports that the average identifiable MD earns about US$400,000 in salary alone globally. Within that, North American MDs averaged approximately US$347,000, while those in Europe/UK averaged around US$435,000.
This salary stagnation is juxtaposed with evolving regulatory and compensation frameworks. After Brexit, the UK removed the EU-imposed bonus cap (previously limiting bonuses to twice base salary). Banks in the UK have since adopted internal bonus caps—Goldman Sachs reportedly up to 25× salary—and as a result, the share of total compensation delivered via salary has increased, though this has also led to average salaries climbing in certain regions. Yet, in the current environment where bonus caps are loosened or removed, there appears to be movement back toward bonuses as primary levers of remuneration, especially for top performers.
Indeed, data from 2024 shows substantial gains among Material Risk Takers and senior staff in investment banking in the UK and Europe. Morgan Stanley’s MRTs in the UK saw average total compensation rise from £1.1m in 2023 to £1.5m in 2024, with bonuses up by 67%. Barclays’ MRT fixed pay averages stood at £642,100, with bonus payouts lifting overall average compensation to approximately £1.5m. Deutsche Bank’s equivalent MRT cohort averaged around €1.8m total compensation in 2024, with bonuses rising 50%.
While these numbers are eye catching, the MD salary base itself remains insulated from many of these gains. The MD salary as fixed component is stable, entrenched around US$400,000 globally, with regional fluctuations. For seniority, geographies or banks with more lenient bonus caps, total compensation can far exceed this base. However, in lower-performing years or during regulatory enforcement, bonus drops can expose the fixed-pay ceiling, leading to wide swings in total income.
Qualitative data suggests that many MDs feel financial pressure despite their compensation. In one article, ex-MDs working with London MDs indicated that even with million-dollar+ total pay packages, life costs and personal leverage (property, education, lifestyle) are stretching finances.
Strategic implications: Banks must calibrate fixed vs variable pay mixes carefully to retain top MDs, especially as regulatory constraints evolve. Geographic competition—in particular between U.S. and UK/Europe—is sharpening. Firms with more generous bonus policies may win talent, but risk exposure, fiscal policy, and macro conditions will influence sustainability. Bonus volatility becomes a major risk to senior talent retention when performance or regulation falters.
Open questions: How will future economic downturns affect bonus-heavy compensation? Will fixed pay bases begin to rise materially, or will variable pay continue absorbing most compensation growth? How do tax policy changes and cost-of-living inflation impinge upon net take-home pay, especially in high cost centres like London and New York? And how many MDs feel the same “stretch” despite large nominal income?
Supporting Notes
- Average MD salary globally is ~US$400,000; North America ~US$347,000; Europe/UK ~US$435,000.
- MD base salaries have not significantly changed since 2022; essentially stagnant for over a decade when adjusted for currency and inflation.
- The UK removed the EU-era bonus cap post-Brexit; banks now set internal caps—Goldman Sachs reportedly up to 25× salary.
- Morgan Stanley’s UK MRTs saw average bonuses rise to £898,461 in 2024 (up 67%), with average total compensation ~£1.5 million.
- Barclays’ MRT fixed pay was £642,100 in 2024; average bonus £778,000; total compensation for MRTs ~£1.5 million.
- Deutsche Bank’s top investment banker bonuses rose 50% to ~€965,000; average total compensation among its MRTs ~€1.8 million in 2024.
- Despite million-plus total pay, London MDs report feeling financially stretched due to costs and fixed vs variable pay balance.