How much do you really earn if you’re a senior M&A ‘rainmaker’? If you’re Ian Hannam, the former J.P. Morgan senior mining banker, the answer seems to be a lot – £99k ($147k) at least in deferred bonuses alone for every single deal he worked on, to be precise.
J.P. Morgan declined to comment on Hannam’s pay, but Sky News recently reported – without stating where it got its figure – that Hannam walked away from £30m in deferred bonuses when he left J.P. Morgan in 2012. Between 2005 and 2012, Hannam worked on 300 deals according to his own website, suggesting he was paid an average of £99k in deferred bonuses for each one.
In fact, Hannam’s pay per deal may have been even higher still: according to Sky, much of the £30m in deferred compensation reportedly related to deals done in 2008/2009. During this time, Hannam’s site shows that he worked on 92 deals in total, suggesting he was paid as much as £327k for each one.
Hannam is now embroiled in court proceedings as he attempts to fight a £450k regulatory fine for market abuse. Headhunters said his pay is redolent of a different era. “Pay for M&A bankers has come down significantly,” said Julia Tustian, a recruiter in corporate and investment banking at Shepherd Little. “Base salaries for senior bankers have risen to anything from £300k to £500k, but bonuses in M&A are much lower than they used to be,” she added.
Another M&A-focused headhunter, speaking on condition of anonymity, said Hannam was a one-off. “He was a king maker. No one really compared to him – most people in M&A earn nowhere that amount.”
In 2005-2006, pay for M&A bankers was much higher, the headhunter added. “Back then, top people were earning £10m or more. Now people earn a fraction of that.”