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To: TFF who wrote (11035)	11/5/2003 4:58:38 PM
From: TFF	of 12617

Boom times return as traders look forward to $1m bonuses By James Moore (Filed: 05/11/2003) Million dollar bonuses are set to be paid to City derivatives traders with as little as three years' experience, according to a report released yesterday. Financial services headhunter Armstrong International said surging revenues at the equity derivatives desks of investment banks will result in even relatively junior traders pocketing huge bonuses. It highlighted Societe Generale, BNP Paribas and JP Morgan as the top three firms. Partner Aidan Kennedy said: "Within the equity derivatives businesses some extremely junior traders with just three years' experience will be expecting bonuses close to $1m [£600,000]." Other areas where fat bonus packages are expected include fixed income, a major area of revenue growth for investment banks. Armstrong drew its conclusions following detailed interviews with professionals across 84 business areas from 11 of the top investment banks. The report comes as senior managers at financial institutions begin meetings to set this year's bonus levels. The report highlights the "fierce debate" within banks over whether some of the huge revenues earned by equity derivatives desks should be used to bolster bonuses for staff on desks that trade actual shares rather than derivatives linked to them. The sight of junior traders pocketing seven-figure bonuses harks back to the bull market of the late 1990s when huge salaries were earned by youthful dealers. The most infamous example was James Archer, son of disgraced peer Jeffrey Archer. He was banned from the City for market manipulation. However, the report cautions that such huge rewards will still be relatively rare. It said that in general there was "cautious optimism" over bonus levels, with typical rises coming in at between 10pc and 20pc. The report also says the cult of the "star" analyst is now dead, with only a handful able to command $1m bonuses. It says middle-ranking bankers, who have been worst hit by job cuts, will be the biggest beneficiaries of rising bonuses. Mr Kennedy said: "The middle-ranking people are the engine room of an investment bank."

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