Citigroup Inc. is raising compensation for its junior investment bankers by as much as 15 percent even as many Wall Street peers are cutting jobs and slashing bonuses after last year’s industry-wide deals slump. 

In a sign of the ongoing struggle for financial firms to retain staff, the New York-based bank is increasing base salaries by an average of 10 percent to 15 percent for associates and vice presidents, people familiar with the matter said, asking not to be identified discussing internal information. 

The pay bump comes after Citigroup warned investors that inflation would push compensation expenses higher this year. The Wall Street giant and its rivals are also contending with private equity firms poaching talent, with dealmaking expected to pick up after a tough year.

A spokeswoman for Citigroup declined to comment.

Financial firms were stung by a sharp decline in dealmaking last year as markets tumbled on increasing geopolitical turmoil and recession fears. Citigroup recorded a 53 percent drop in investment banking fees for 2022, though its traders were able to take advantage of volatile markets to boost revenue 7 percent.

Citigroup chief executive officer Jane Fraser warned analysts last week that the firm’s investment banking division “felt the pain” of the industrywide slump in deals.

“While the pipeline looks more promising and client sentiment is improving, it would be hard to precisely predict when the tide will turn in 2023,” Fraser said.

For the most part, senior bankers have born the brunt of last year’s falloff in business. Credit Suisse Group AG chairman Axel Lehmann warned that employees should brace for bonus cuts following a “horrifying year,” while JPMorgan Chase & Co.’s co-head of investment banking said bonuses will “absolutely” fall. Goldman Sachs Group Inc. is cutting about 3,200 jobs.