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March 24, 2016 at 06:17 AM
(Bloomberg) — Credit Suisse Group AG’s Tidjane Thiam received $4.7 million for his first six months on the job, less than his target after the chief executive officer volunteered for a 40 percent bonus cut as a gesture to beleaguered traders.
“I felt that out of solidarity, I should take a cut bigger than the global markets” arm, Thiam said Wednesday, as the bank disclosed that it cut the trading unit’s bonus pool 36 percent. The request was approved “despite his excellent performance,” Zurich-based Credit Suisse said in its annual report Thursday.
Thiam, 53, who joined in July, received a bonus of 2.9 million francs ($2.9 million) and a base salary of 1.6 million francs as well as 130,000 francs in benefits. He also received 14.3 million francs to compensate for pay he gave up when he left his previous position as CEO of Britain’s Prudential Plc.
Executive board members together received 64 million francs in 2015, about the same as for 2014. Rob Shafir, who stepped down from the board in October to become chairman of the Americas, was the highest paid with 7.9 million francs in compensation.
Rohner Cut
On the whole, Switzerland’s second-largest bank allocated 11 percent less money for bonuses in 2015 after logging its first annual loss since 2008. Turbulent markets, trading losses and a write-down on the value of its investment bank weighed on fourth-quarter results.
Thiam has reorganized Credit Suisse and overhauled management to prioritize wealth management and scale back the securities unit. The bank tapped shareholders for about $6 billion after he came on board, partly to fund the restructuring.
A selloff in bank stocks at the start of this year hit Credit Suisse harder than most, with shares down 36 percent this year. On Wednesday Thiam announced 2,000 more job cuts — all in global markets — and said he was cranking up efforts to unwind trades that will probably wipe out first-quarter profit.
While he took a bonus cut to show support for the securities unit, Thiam faulted some traders for building up positions in distressed debt and leveraged loans unbeknownst to him and other managers.
Credit Suisse Chairman Urs Rohner received 3.2 million francs for 2015, down 11 percent from 3.6 million francs for the previous year. The bank paid former CEO Brady Dougan 9.7 million francs for 2014. The report didn’t say how much Dougan got for his final six months at the bank.
New Directors
Other European banks have also reduced pay. Deutsche Bank AG, which houses Europe’s largest investment bank, cut variable compensation 11 percent after posting its first annual loss since 2008. At Barclays Plc, led by Jes Staley, the bonus pool shrank 10 percent last year.
