Credit Suisse increased the pay of its chief executive Brady Dougan by one third in 2012 to CHF7.8 million ($8.2 million), at a time when the net income of Switzerland’s second biggest bank declined for the third time in a row.
Dougan’s 2012 remuneration package included a base salary of CHF2.5 million, a CHF500,000 cash bonus as well as short- and long-term stock awards, according to the Credit Suisse Group annual report published on Friday. Dougan was paid CHF5.8 million in 2011.
The Credit Suisse executive board pay committee said Dougan was rewarded for scaling back the bank’s risk in 2012, improving capital, slashing spending and restructuring.
The bank’s net income fell to CHF1.35 billion in 2012 from CHF1.95 million the previous year, including the cost to settle litigation against the company announced last week and accounting charges related to its own debt. The bank cut 2,300 jobs in 2012 and currently has a workforce of about 47,000 around the world.
The bank’s top earner last year was Robert Shafir with an overall pay of CHF10.6 million, up from CHF 8.5 million in 2011. He was promoted co-head of the newly merged private bank and asset management unit last November. Credit Suisse Chairman Urs Rohner bank also saw his pay rise by a third to CHF5.2 million.
Overall the 13 top Credit Suisse board members earned CH74.1 million in 2012, up CHF4 million on the previous year. Total salary costs for Credit Suisse staff dropped five per cent last year to CHF12.5 billion.
The announcement comes shortly after Credit Suisse’s investment banking rival, UBS, disclosed a near $9 million pay-out for CEO Sergio Ermotti last year and a $26 million welcome package for its new investment bank chief.
Fat cats
The latest figures are likely to cause public and political dismay over the scale of fat cat salaries and fuel the debate over banker bonuses.
At the beginning of the month, Swiss voters overwhelmingly approved a proposal to rein in top manager payments and give shareholders a greater say on remuneration issues.
The decision gave Switzerland one of the world’s strictest controls on executive pay and attracted worldwide attention.
European Union officials are also expected to propose legislation, including capping bonus payments for top executives.