The current year looks better for equity markets, translating into better demand for capital market professionals after a lacklustre performance for regional bourses and brokerages in 2009, but experts say that local market movers should not expect a huge jump in their salaries on the back of this recovery.

"[Salaries are] mostly static with a few small reductions. Obviously, bonus/commission levels have dipped and are in line with performance," Peter Greaves, Director, Head of Financial Markets at McArthur Murray, told Emirates Business.

He also maintained that consolidations among brokerages are depressing salary levels. "Massively. Brokerage has gone from over broke'd to a buyer's (or I should say wage payer's) market," he said.

"While there were, in the bull run, similarities (20 per cent less) in compensation to capital markets, brokerage is such a depressed market, especially in the UAE with some 88 brokers (approximately 27 in Saudi) that compensation has crashed. If you have a salary, you're doing okay. Compensation for the very senior guys who do have strong client relations and can build brokerage, have held strong," he added while commenting on brokerage compensation.

However, others tend to disagree on the level of impact on the salaries of capital market professionals. "It hasn't [been] impacted for the clients we work with," said Ally Ho, Head of Financial Services for Middle East and Africa at Pedersen and Partners, but said this problem mainly plagues small cap firms, and large brokerage houses remain unaffected.

"Consolidations among brokerages only happened for those who were small cap firms, and the consolidation happened for both economic as well as competitive reasons. The large brokerage houses in the region remained solid during the past 18 months and, therefore, for the clients we service, those in the larger brokerage houses and salaries did not see a hit," she told this paper.

According to Greaves, "Over the past 12-18 months, [there has been a] standstill in capital markets. Brokerage has taken a huge hit. More recently, [there has been] some increase in M&A, PE (private equity) and advisory as firms are looking to upgrade the quality." Ho agrees that things have started to look up. "[In] 2010, the markets have picked up on both sides with bond issuances by [entities] such as Dewa oversubscribed by a significant margin. The market has also improved on the ECM (equity capital markets) side as there are more firms exploring the option of [launching] IPOs into a now less volatile market than last year," she said.

Explaining the situation last year, Ho said: "In 2009, the market was hit on both sides of the business within capital markets, but employees were not shed from these areas. Instead, teams worked on restructuring mandates where both sides were required to raise capital for financings through either bond issuances or going out to the market to raise fresh equity in order to restructure.

"Demand for pure brokerage houses saw more consolidation, and instead of finding candidates who were specialised by product type, [professionals] consolidated their skill set and became generalists in order to provide a better service to available clients."