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M&A Boom In Canada Pushes Banks To Hire More And Pay Higher

M&A Boom In Canada Pushes Banks To Hire More And Pay Higher
Investment banks operating in Canada are being encouraged to increase staffing because of record breaking deal making in Canada. However to attract fresh talent, some of the firms are being forced to pay up in unique ways because of increased demand for bankers.
According to Refinitiv, following the crushing of deal making in the first three quarters of 2020 because of the Covid-19 pandemic there has been an increase in Canadian mergers and acquisitions (M&A) so far this year at a record $206.5 billion and with IPOs hitting an all-time high of $5.6 billion.
The M&A teams of HSBC, JPMorgan Chase & Co and National Bank of Canada are being expanded.
"It continues to be an active market with lots of active discussions with clients going on as well, and so that has absolutely spurred on a need to fortify the ranks within the teams," said Scott Lampard, head of global banking for HSBC Bank Canada.
Lampard said that HSBC will be hiring an additional 20 per cent to 25 per cent staff members for its overall investment banking business primarily at the analyst level for supporting pitching and for executing deals.
Banks are being forced to pay more for hiring and retaining their existing teams because the speed of transaction is expected to continue at pace. Recruiters say that a range of new services are being offered by banks such as sending in a consultant for creating the ideal home office.
"We've been doing this for nearly 20 years and we've never seen a market like this," said Bill Vlaad, CEO at recruitment firm Vlaad and Company. "Everybody is scrambling,"
"Many of the banks have increased base salaries quite dramatically, mostly in 2021," he said, adding salaries had increased 20%-40% across M&A roles. "Now if you want to attract, you have to put something else on the table."
Vlaad said that banks are also poaching talent by offering tailor made offers to individuals which include signing bonuses, extra vacation days, healthcare increases, special programs for mental wellness and home office perks.
At the top M&A advisers year to date are TD Securities, Barclays and CIBC World Markets.
The $33.6 billion bid offer by Canadian National for Kansas City Southern and the C$20 billion ($16.2 billion) bid for Shaw Communications Inc by Rogers Communications Inc are the largest of the two deals so far this year in Canada.
According to reports based on analysis of filings, an average of C$3.1 billion ($2.50 billion) in total bonuses was paid last year by five of the top six Canadian banks despite the Covid-19 pandemic, which was higher than the amount paid by them in 2019 of C$2.9 billion ($2.34 billion). 

Christopher J. Mitchell

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