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Credit Suisse CEO gets a 30% pay hike for completing turnaround
[ZURICH] Credit Suisse Group boosted chief executive officer Tidjane Thiam's compensation by about 30 per cent for delivering the first annual profit in four years, even as the bank's trading losses continue to overshadow progress in other areas.
Mr Thiam's pay for 2018 rose to 12.7 million Swiss francs (S$17.3 million), according to the bank's compensation report. A large part of the increase was to compensate Thiam for a 2017 pay cut that aimed to calm shareholder objections to generous compensation packages amid three years of losses.
Without last year's pay cut, the increase for 2018 would have been 13 per cent, Switzerland's second-largest bank said. While the overall bonus pool was unchanged from last year at 3.2 billion francs, many top performers received bigger awards, the lender said.
"Differentiation has been made such that high-performing employees received year-on-year increases in variable incentive compensation," said Kai Nargolwala, who heads the board compensation committee.
Thiam returned the bank to profitability with deep cost cuts and steady results from wealth management. Still, continued losses at the trading unit have weighed on the company's share price. The stock has declined more than 50 per cent in Thiam's tenure.
The global-markets business posted a larger-than-expected loss of 193 million francs in the fourth quarter, offsetting wealth-management and investment-banking results that beat estimates. Mr Thiam, a former insurance executive, is under pressure to boost performance of the unit that trades bonds, stocks and derivatives.
Credit Suisse last year introduced changes to its compensation policy after shareholder backlash. The bank dropped capital metrics for its short-term awards, increased the importance of cost targets and introduced return on tangible equity as a measure for long-term incentives.