Investment bankers working on debt underwriting may see bonuses climb by 25% to 35% this year, and bankers handling initial public offerings could see a 20% to 30% jump in 2024, Johnson Associates, a Wall Street compensation analysis firm, said in a report.

Strong growth in debt issuance, and IPO activity that has already raised more this year than in all of 2023, are the main reasons for higher compensation.

Although investment-banking revenues are still below their peaks, activity is picking up considerably, the Johnson Associates report says.

Other areas in which bankers could receive higher bonuses are equity and fixed income sales and trading. Equity traders may receive 10% to 15% higher bonuses and fixed-income traders may collect 5% to 10% higher compensation.

Clients are beginning to increase risk in equities, the report said, in tandem with market expectations of future rate cuts.

Even with sharp growth in recent years, alternative investment firms are expected to pay flat to 10% higher incentives this year, as the firms have large volumes of capital that have not yet been invested.

Wealth management and asset management executives are expected to receive 5% to 10% higher incentives this year, the consultancy predicted.