Zurich — UBS boosted CEO Sergio Ermotti’s pay and increased the bank’s bonus pool by about 6% after underlying profit increased.
The Zurich-based lender boosted the bonus pool for 2017 to Sf3.1bn ($3.3bn), according to its annual report published on Friday. Ermotti remains
the highest-paid executive, with a total compensation of Sf14.2m, up from the Sf13.7m he received in 2016. That includes Sf11.4m in variable compensation.
UBS’s investment bank allocated the biggest discretionary payouts to the highest revenue generators and younger employees, as competition from other industries intensifies, people with knowledge of the matter said last month. Andrea Orcel, head of UBS’s investment bank, said in an interview in December that 2017 would prove to be a "tricky year" for compensation in the industry, but that his company had done slightly better than a year earlier.
"We delivered excellent financial results, maintained our strong capital position and achieved our net cost reduction target in 2017," the bank said in the report. The previous year, the Swiss lender handed out the smallest bonuses in four years, awarding employees about Sf2.9bn.
The bank’s bonus pool is tied to several performance indicators, including capital strength and some profitability measures. Late in 2017, Ermotti was involved in a heated exchange with a former Bank of England deputy governor who said bankers could cut their own pay instead of complaining about how difficult it was to make money. At a conference in London in November, he said that criticising banker pay was "very simplistic." In awarding Ermotti’s pay, UBS said that "overall performance exceeded the plan despite significant market headwinds, including low market volatility, negative interest-rate environment and high funding costs".
In January, UBS announced its first buyback since the credit crisis and laid out new financial targets. The lender plans to repurchase about Sf2bn worth of shares over three years, and committed to increasing the dividend each year, by mid to high single-digit percentages, compared with a previous target to return at least half of profit to shareholders, providing its capital ratio remained above 13%.
The bank’s profit for 2017 was $1.1bn, compared with $3.2bn a year earlier because of a Sf2.9bn write-down of deferred tax assets, after the enactment of legislation in the US reduced the value of previously recognised US deferred tax assets. Adjusted profit before tax increased 16%, the bank said.
Total fixed and variable compensation for top 12 executives at the bank totaled about Sf97.9m, the bank said. Axel Weber, the bank’s chairperson, received total pay of about Sf6.03m in 2017, slightly below the year-earlier figure.
The Zurich-based lender boosted the bonus pool for 2017 to Sf3.1bn ($3.3bn), according to its annual report published on Friday. Ermotti remains
the highest-paid executive, with a total compensation of Sf14.2m, up from the Sf13.7m he received in 2016. That includes Sf11.4m in variable compensation.
UBS’s investment bank allocated the biggest discretionary payouts to the highest revenue generators and younger employees, as competition from other industries intensifies, people with knowledge of the matter said last month. Andrea Orcel, head of UBS’s investment bank, said in an interview in December that 2017 would prove to be a "tricky year" for compensation in the industry, but that his company had done slightly better than a year earlier.
"We delivered excellent financial results, maintained our strong capital position and achieved our net cost reduction target in 2017," the bank said in the report. The previous year, the Swiss lender handed out the smallest bonuses in four years, awarding employees about Sf2.9bn.
The bank’s bonus pool is tied to several performance indicators, including capital strength and some profitability measures. Late in 2017, Ermotti was involved in a heated exchange with a former Bank of England deputy governor who said bankers could cut their own pay instead of complaining about how difficult it was to make money. At a conference in London in November, he said that criticising banker pay was "very simplistic." In awarding Ermotti’s pay, UBS said that "overall performance exceeded the plan despite significant market headwinds, including low market volatility, negative interest-rate environment and high funding costs".
In January, UBS announced its first buyback since the credit crisis and laid out new financial targets. The lender plans to repurchase about Sf2bn worth of shares over three years, and committed to increasing the dividend each year, by mid to high single-digit percentages, compared with a previous target to return at least half of profit to shareholders, providing its capital ratio remained above 13%.
The bank’s profit for 2017 was $1.1bn, compared with $3.2bn a year earlier because of a Sf2.9bn write-down of deferred tax assets, after the enactment of legislation in the US reduced the value of previously recognised US deferred tax assets. Adjusted profit before tax increased 16%, the bank said.
Total fixed and variable compensation for top 12 executives at the bank totaled about Sf97.9m, the bank said. Axel Weber, the bank’s chairperson, received total pay of about Sf6.03m in 2017, slightly below the year-earlier figure.
- Bloomberg
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