Deal makers, PE employees may get biggest bonus hikes this year

* Forecast by Johnson Associates

* Overall bonuses on Wall Street will be flat

* M&A advisers, PE pros can expect 10-15% rise in bonuses

Overall, year-end incentive payments on Wall Street are expected to be mostly flat compared with last year, the consulting firm said.

“A mixed bag of fortunes awaits Wall Street professionals this bonus season, despite a moderately positive year across the financial services industry,” said Alan Johnson, managing director of Johnson Associates.

Both M&A advisers and private equity employees can expect a 10-15 percent rise in bonuses this year, Johnson Associates said.

Global M&A activity rose 59 percent to $2.7 trillion in the first nine months of 2014, the strongest since 2007, according to Thomson Reuters data.

Bonuses for employees in low-risk, fee-heavy businesses such as asset management could rise 5-10 percent, while professionals in the volatile and risk-heavy business of fixed-income trading can expect bonuses to remain flat or fall by as much as 10 percent, according to the forecast.

The declining fortunes of bond traders, once dubbed “Masters of the Universe” at investment banks, and the rising prominence of wealth managers show how Wall Street is changing after the financial crisis.

Equity traders are also expected to take a cut, with their bonuses likely to fall by 10 percent this year.

But investment banking underwriters could see a 5-15 percent rise in bonuses, thanks to an increase in capital-raising activity, especially initial public offerings, this year.

Bonuses for asset managers are also expected to rise by 5-15 percent as increased assets under management and soaring equity markets boost results of cost-efficient firms.

Johnson Associates’s forecasts are based on a survey of eight of the largest banks and 10 of the largest asset-management firms in the United States.

Reporting by Neha Dimri and Anil D’Silva of Reuters news service.