City workers to reap £9billion Christmas bonuses

13 April 2012

Workers in the square mile financial district of London are expecting to share £9billion in bonuses this Christmas and are planning to share their wealth through living the high-life.

London's financial industry is booming, with mergers and acquisitions activity set to hit a record $1trillion-plus this year in Europe alone.

The City's success has helped the rest of London to do well. "With some City bonuses likely to be up several hundred percent on last year, the omens are good for almost every part of city life," said Tara Ricks, managing director of City recruitment firm Joslin Rowe.

"From big ticket items such as new homes, car sales, holiday apartments, yachts, shares and race horses to luxury holidays, jewellery, fine dining and designer clothes, this money will pour back into the economy," she said.

Bankers get their wad of cash in December/January when banks start paying out 2006 bonuses that could run to tens of millions of pounds for some high fliers.

No one can easily track where the money goes, but London property is likely to claim a big share of this year's bonus "pool" estimated at nearly 9 billion pounds by economics consultancy the Centre for Economics and Business Research.

A CEBR study, done a few years ago, found that 50 percent of bankers' bonuses was spent on London property and estate agents say this could still hold true based on anecdotal evidence.

"What really sparked the price increase in Central London was the bonuses last year," said Neil Chegwidden, head of research at Cluttons, referring to big bonus payouts in 2005 year as the financial services bonanza gathered steam.

£4,000 lunches

Bankers also spend heavily on fine dining, wine, trendy bars, and even flowers and exclusive concierge services. Shane Osborn, head chef at top London restaurant Pied a Terre, said at bonus time City bankers come in to celebrate.

"You see the City boys coming in in groups of 4 and 5 having a jolly evening and going for top-end champagne and wine - Dom Perignon, Krug, Cristal and Petrus."

Osborn, who's restaurant is one of only four in London with two Michelin stars, said bankers can easily spend 3,000 or 4,000 pounds just on lunch. "They like to let their hair down."

Holiday company Trailfinders said it is also seeing strong demand for luxury. The Maldives and Mauritius are popular holiday destinations, but Antarctica is becoming trendy.

"We fairly regularly get people spending more than 20,000 pounds on a holiday," a spokesman in their City branch said.

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