How much was UBS Libor trader Tom Hayes paid?

As has been widely reported in recent days, Tom Hayes, a Tokyo-based trader at UBS, was at the centre of the bank's Libor-fixing scandal. Hayes, who was arrested in connection with the affair last week, has an MBA from Hult International Business School and left UBS in 2009 for Citigroup. Citigroup dismissed him in 2010 for suspected involvement in rate manipulation.

Since then, it seems Hayes has been busy investing in a software development firm and living in the UK in Surrey. This idyll has now been shattered and he is in danger of being extradited to the US (although the chairman of the Home Affairs Select Committee is calling for him to remain in the UK).

Reports today indicate that Hayes' time at UBS was lucrative. Between 2006 and 2009 he allegedly single-handedly made a reported $260m in revenues for the bank according to the Commodities Future Trading Commission. The Financial Times suggests fellow traders were well aware that this could have resulted in a substantial payout for Hayes and said Hayes should think of them when he was on his yacht in Monaco.

How much was Tom Hayes paid for his efforts at UBS? This isn't clear. UBS is declining to comment on both his level of compensation and on the issue of clawbacks. It seems unlikely that Hayes would have his historical pay removed, however, as the infraction happened before clawbacks were popularised.

Headhunters' estimates of Hayes' pay vary wildly. One ex-head of a Tokyo-based search firm at the time Hayes was working in Japan, says he would likely have been paid a percentage of revenues anywhere between 8%-12% of the total, implying compensation of $10m a year over the three-year period. "The thing about Japan is that there are very few good and proven Westerners in Toyko. They're like hen's teeth and are therefore well remunerated. It's also a harsh environment with fiendishly expensive housing, so Westerners used to earn very large expat packages," he adds.

However, London-based headhunters say $13m sounds wildly optimistic. "Revenues that large would have been driven by the franchise [ie. UBS] rather than the performance of an individual," says one. "He would have been lucky to earn $1m."

Another London-based interest rates headhunter says that in the City during 2006 and 2007, it was possible for rates traders to take home 5% of their earnings - implying Hayes might have been on $4m a year. Needless to say, packages have plummeted since. Today, a standard rates trader working in the City might generate revenues of $50m a year and $100m a year in extreme cases, suggests the head of one fixed income boutique. Bonuses are now entirely discretionary. "It used to be common to pay a percentage deal," says Cliff Weight at compensation specialist MM&K.

Headhunters we interviewed declined to offer named commentary for this article.