DBS chief Piyush Gupta's 2020 pay falls 24% as Covid-19 bites

Published Mon, Mar 8, 2021 · 05:49 PM

DBS Group’s chief executive Piyush Gupta's pay fell 24 per cent to S$9.18 million in 2020 as the Covid-19 pandemic took a bite out of bank earnings, according to the bank’s annual report on Monday.

His total compensation in 2019 was S$12.13 million, which equates to a difference of about S$2.94 million in the amount received last year. This is Mr Gupta’s 11th year with South-east Asia’s largest bank by assets.

In the report, the drop in the bonus was attributed to the difficult operating environment, general cutbacks adopted across the bank and the reduction in the lender’s profits by 26 per cent. This was due to a quadrupling of provisions as general allowances were set aside for asset quality risks arising from the pandemic.

Mr Gupta’s pay in 2020 consisted of a cash bonus of S$3.41 million and shares worth S$4.51 million, on top of a salary base of S$1.2 million. The base salary was unchanged for the year. It also includes a non-cash component of S$62,130.

The share plan amounting to S$4.51 million excludes the estimated value of retention shares amounting to S$901,460, which serve as a retention tool and to compensate staff for the time value of deferral. 

This comes as at DBS, ordinary dividends on unvested shares do not accrue to employees.

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In the report, Mr Gupta wrote that 2020 was “indeed an inflexion point” in three key ways - acceleration of digital adoption, transformation in work habits, and a greater push of the sustainability agenda.

These trends have far-reaching implications on banking, he noted.

“In the early days of the crisis, many leaders suggested that the day of the ‘office’ was over, and remote working would be the new norm,” said Mr Gupta. “I did not agree, believing that at heart, we are social creatures.”

However, he said, the bank will not go back to the old ways of working. Among the changes that the lender sees in the “future of work” is that the workforce will be increasingly distributed by location.

“The different ‘lockdown’ requirements in different countries and markets showed us that concentrating large pools of employees in a single location comes with unforeseen risks,” he said. “The ability to connect people from remote locations to our entire infrastructure created the possibility that we could have smaller teams of people work for us from regions where suitable talent is abundant.”

As such, the bank is revisiting locations of its incremental engineering resources, he said.

Even as DBS faces a double whammy of low interest rates and asset quality risks, Mr Gupta believes that there are still bright spots, with fee income likely to benefit, especially wealth management.

Digitalisation will also bring additional growth prospects, he noted.

“The accelerated adoption of digital behaviours by customers creates opportunities for market share gains,” Mr Gupta said. “There will also be new business opportunities, such as the Digital Exchange we launched in the fourth quarter.”

The members-only exchange, available to institutional and accredited investors, consists of a platform for the issuance and trading of tokenised digital assets, a crypto trading platform, as well as digital custodial services. This rides on the growing appetite for digital assets.

As part of board renewal, two non-executive directors and one independent director will be stepping down as board members in March 2021. They are Euleen Goh, former CEO of Standard Chartered Singapore; Andre Sekulic, retired president of MasterCard Asia Pacific, Middle East and Africa; and Ow Foong Pheng, a senior Singapore civil servant.

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