Private credit competition to drive bonus bump

Private credit is seen as the hottest sector in asset management currently, with the highly competitive market driving bonuses up 10 per cent this year.

According to a third-quarter update from Johnson Associates, private credit managers are likely to see a 10 per cent jump in their year-end payout compared with 2023. In contrast, private equity incentives are expected to be up five per cent.

In investment banks, those who work on debt underwriting are expected to see the biggest jump in their year-end incentives, up 25 to 35 per cent year-on-year, with revenues boosted by debt issuance growth.

Read more: Private credit “blitzscale” sees competition intensify

The report from the compensation consultancy noted that alternatives are a strategic priority for many financial services firms, including those who traditionally did not offer these asset classes.

With banking regulation shifting momentum to private credit firms, ongoing partnerships among major banks and alternative asset managers and the proliferation of private credit across multi-strategy alternatives is making the market “highly competitive” the report said, putting compensation pressure on firms.

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