Senior professionals in the financial services industry in India are today getting paid almost on par with their counterparts in London or New York. Boom in the equities market and hectic mergers and acquisitions activities have pushed the salary levels to a new high along with demand for personnel.
"In 2006, India reported the highest average salary increase in the Asia Pacific region at over 14 per cent. In some sectors, salaries of senior executives are on par with global levels, due to the mobility and shortage of such executives, with premiums being paid in certain sectors like banking and capital markets," said David Hui, Senior Client Partner, Asia Pacific Financial Services, Korn / Ferrry International.
K Sudarshan, Managing Partner, EMA Partners International said that people who were earning Rs 50 to Rs 60 lakhs two years ago are currently getting paid Rs 1.5 cr. "India has been the fastest growing market in recruitment search and our practise has grown by 100 per cent in last two years," he said.
"I think compensation is a challenge at the senior level. It is a bit of challenge from the stand point of also getting global fees and revenue to justify that," said Hui. The middle level and entry-level salaries have not moved up as steeply as the top, recruiters said. Compensation packages comprise mainly of performance-linked bonus abroad while in India, the ratio of salary to bonus is around 50:50 said Hui.
Investment banking is the highly paid sector but the increasing number of real estate businesses and private equity funds are luring talent with high compensation. Shortage of talent is brining back not only expat Indian but also foreigners who look at Indian experience as essential.
"Foreigners want India on their resume. Here is where the action is," said Deepak Gupta, India Country Head, Korn / Ferry International. Brooks Entwistle, MD & CEO, Goldman Sachs (India) said that 150 of the Indian expatriates with them in the US want to return.
"The market doesn’t have anymore people," said Sudarshan, indicating acute shortage in the industry. In his search for a chief investment officer for an AMC in the last three months Sudarshan said that he has not been able to put more than six candidates on the table.
Barclays Bank had indicated that they wanted to recruit 5,000 candidates in India, according to Sudarshan. Rapidly expanding ICICI Bank added 8,000 jobs last year and expects to add almost similar numbers this year, indicated their CFO, Vishaka Mulye.
Annual increment at the bank was 7.5 per cent to 10 per cent but it is the ESOP that makes a major difference to the compensation package.