Renaissance Raises Salaries For Execs to Precrisis Level
- By Gyuzel Gubeidullina
- Sep. 09 2009 00:00
Following in the footsteps of Renaissance Capital’s ordinary employees, executives at the investment bank can expect to be receive their precrisis salaries beginning in October, a move expected to cost $15 million to $20 million.
On July 1, employees at the vice president level and lower at Renaissance Capital and Renaissance Investment Management were returned to their precrisis salaries in dollar terms, meaning increases of 20 percent to 35 percent.
But the bank is now going to extend the raises to its senior employees. From Oct. 1, directors, executive directors and managing directors will be paid their earlier salaries, Renaissance Group chief Stephen Jennings wrote Monday in a letter to employees.
A Renaissance Capital spokesperson said the change would affect roughly 100 people.
“We promised employees a raise at the end of the third quarter, and we’re delivering it,” Renaissance Capital president Ruben Aganbegyan said. “Now there isn’t a single person in the company whose salary is less than it was before the crisis.”
Jennings said last month that Renaissance had put the crisis behind it. Since the start of the year, the investment bank’s earnings have passed $300 million, according to preliminary results, with expenses of less than $100 million, and the situation is improving every month, he said.
A senior executive at the investment bank said Renaissance was expecting expenses of $160 million to $165 million before paying bonuses. The figure could increase by another $15 million to $20 million because of the added compensation, he said. The Renaissance spokesperson declined comment.
In addition to boosting compensation, Renaissance has begun hiring again. About 30 people have already joined the bank, and it is planning to take on another 20, Aganbegyan said. Renaissance Capital now employs 760 people, compared with 1,200 before the crisis.
More and more players on the market — both foreign and domestic investment banks — are hiring, said Fyodor Sheberstov, a managing partner at Pynes & Moerner. He said Renaissance was probably seeing more demand from its clients because markets are recovering, putting investment banking and brokerage services back in demand.
Deutsche Bank raised its employees’ salaries in July. That increase was for four groups, including young specialists and employees who received promotions before 2009 but were not given raises, a spokesperson for the bank said, adding that Deutsche Bank did not reduce salaries during the crisis.
A spokesperson for Troika Dialog said the bank was paying “market” salaries, which are revised twice annually based on results.