UAE talent war: Banks hike joining bonuses

Joining bonuses have picked up a lot in the banking industry this year and an increasing number of banks in the UAE are enticing candidates by offering them an amount to join them.

Employee bonuses overall, whether joining ones or performance based, are perhaps as important as the base salary in the banking world and some of these financial institutions have received a lot of wrath for giving huge handouts to people who work there.

Most of the bigger bonuses are taken by those in investment banking but bonuses do make up a big part of the pay package of anybody working in a bank.

And, the good news for bankers in the UAE is that both (joining and performance based bonuses) have gone up in 2014.

“The trend this year has been an increase in banks paying joining bonuses to compensate senior candidates for loss of performance bonus as a result of leaving their current employer,” as Hasnain Qazi, Gulf Region Head of recruitment firm Huxley Associates told Emirates 24|7.

“While this is a standard industry practice, we have witnessed banks demonstrating an increasing appetite to meet significantly higher joining bonus expectations. This stems from increasing local market confidence and sentiment and reciprocates the better numbers coming out of the US economy,” he explains to this website.

And, the big bonuses are not just limited to investment and boutique banks. Those in retail can too expect more cash in hand this year.

“The banking sector is, indeed, showing trends of big bonuses being back, with retail banks and regional banks offering higher amounts.  However, this is just a trend for the time being,” says Konstantina Sakellariou, Marketing & Operations Director at international recruitment firm Stanton Chase.

Despite the hike in bonus payouts, the Middle East financial sector still faces a bout of job-hopping following disappointment over the payments received.

According to an earlier report by website efinancialcareers, nearly 60 per cent of the respondents to a 2014 Middle East bonus survey carried out by the firm, said they would be looking to leave their current employer following dissatisfaction with their variable remuneration.

This is despite the fact that 46.3 per cent claimed to have received a bonus uplift on 2013, while just 21.3 per cent of respondents received less and 25 per cent said that their payout remained the same.

The vast majority were underwhelmed with the figure offered by their employer for 2013 performance, with just 9.3 per cent saying it exceeded their expectations. Instead, 48.7 per cent were disappointed with this year’s bonus and 34.7 per cent said it was in line with what they were anticipating.

The survey findings also highlighted that compared to their peers in other large financial centres, Middle East bankers are underpaid, leading to disappointment among them.

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