Asia Investment Banking Bonus Surge: 20% Uplift Driven by IPO, Bond & M&A Boom

The investment banking compensation environment in Asia for 2025 has shown marked strength, driven by exceptional fundraising and capital markets activity, particularly in Hong Kong. Multiple banks are using this momentum to reward frontline bankers with significantly higher bonuses, while regional exchanges and policy reforms further amplify the favorable backdrop.

Bonus increases tied to market outperformance. UBS, Citigroup, and Morgan Stanley are boosting Asian investment banker bonuses by about 20% in 2025, the largest increase since 2021, as revenue from IPOs, bond markets, and M&A rebounded substantially.

Revenue surges corroborate payout potential. Citi’s investment banking client revenues in Asia-Pacific rose by approximately a third (33%) year-over-year, to US$514 million. A key contributor was helping Asian clients raise over US$250 billion in global capital markets last year.

Hong Kong regains global leadership in IPOs. HKEX raised US$37.22 billion via IPOs on its main board in 2025, a 229% increase from the previous year; this surpassed major listings on Nasdaq and NSE/BSE. This performance, second only to 2021’s US$42.97 billion, underscores renewed confidence and international investor influx.

Structural tailwinds supporting future growth. Reforms by HKEX—including the creation of the Technology Enterprises Channel, biotech-tech focused indices, and regulatory enhancements—are making listing more accessible for specialist issuers. Combined with large pipelines of potential IPO applicants (300+ waiting), this suggests carryover momentum into 2026.

Uneven benefit distribution and risks. Not all staff are benefitting equally; increases are concentrated among investment bankers and those working in high-growth sectors such as EVs, tech, and Greater China. Back-office, support, and non-deal-driven roles see little or no bonus uplift. Risks include regulatory instability, macroeconomic headwinds (interest rates, geopolitical risk), and possible valuation compression, which could dampen deals and margins.

Strategic implications for banks and stakeholders.

• Banking firms competing for talent in Asia need to calibrate compensation structures to reflect market performance, especially in Hong Kong and Mainland China.

• Institutional investors should anticipate elevated costs in deal underwriting and advisory, potentially compressing margins if deal volumes moderate.

• Policymakers should monitor whether listing reforms maintain quality thresholds and balance investor protection amid speed-to-capital pressure.

Open questions.

• How sustainable are elevated bonus levels if macroeconomic conditions deteriorate (e.g., interest rate hikes, slowing global growth)?
• Will regulatory changes in China and offshore jurisdictions affect where companies choose to list?
• How will banks balance the need to retain top performers with cost discipline and investor expectations in 2026?