Wall Street bonuses expected to hit record as bank profits surge

The Wall Street bonus pool is expected to break records this year if current trends continue, as big banks reap profits from soaring stocks and a return to more dealmaking after a long drought.

Profits at the 130 firms that belong to the New York Stock Exchange reached US$30.4 billion in the first half of the year and will hit the highest level on record if that pace continues, New York State Comptroller Thomas DiNapoli said on Thursday (Oct 23) in an annual report.

Compensation expenses increased by almost 10 per cent in the first half of 2025 from the prior year, suggesting bonuses could balloon after already hitting a record last year, when the average annual bonus reached US$244,700.

DiNapoli cheered the banks’ gains, noting they’d boost tax revenues needed to make critical investments in public services.

“While uncertainty remains around interest rates, inflation and the broader economy, Wall Street looks to have another strong year,” he said in a statement.

Wall Street trading desks seized on both tariff-fuelled market volatility this year and a stock rally boosted by technology stocks tied to artificial intelligence. For the third quarter, Morgan Stanley, JPMorgan Chase, Bank of America Corp, Citigroup, Goldman Sachs Group and Wells Fargo reported US$15.4 billion in trading revenue – the highest for that period in at least five years.

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The latest estimate updates an earlier forecast, which projected that economic turmoil and geopolitical uncertainty would cause the bonus pool to shrink by 14 per cent.

In August, compensation consultant Johnson Associates also changed its outlook on Wall Street bonuses after investment bankers started to see a pick-up in mergers and acquisitions and other deal-related activity.

The latest report from DiNapoli also found that New York City tax collections from the securities industry rose 35.1 per cent to US$6.7 billion in the latest fiscal year.

Last year, the average salary in the city’s securities industry rose 7.3 per cent to US$505,630, about five times the average salary for New York’s private-sector workers, according to the report.

Wealth inequality has become a hot topic of discussion in New York, where the Democratic mayoral candidate, Zohran Mamdani, is running on a platform of lowering the cost of living for working-class residents – including by taxing corporations and the wealthy. BLOOMBERG