CREDIT Suisse is to defer more of its staff bonuses and cut cash payouts, in a move that followed stricter rules imposed elsewhere in Europe.
Switzerland’s second-largest bank, which last year awarded chief executive Brady Dougan shares worth around Sfr71m (£47m) under a five-year bonus plan, said yesterday it would apply the changes to its 2010 pay round.
Toughened pay regulation has yet to quash intense public scrutiny over year-end payouts, however, and governments have struggled to ward off a backlash against bonuses as detail of top bankers’ pay packages begins to emerge.
The Swiss government has kicked off a legal process to tighten regulation of its top banks, including the right to force those bailed out by the state to make changes to bonuses and even cancel payouts.
After bringing in a new pay structure last year, Credit Suisse’s revamped rules will see it lower the threshold for deferred bonus restrictions to Sfr50,000 from Sfr125,000, leaving more employees subject to the measures.
Credit Suisse said the changes were made against a backdrop of emerging regulation and market practices, and in dialogue with regulators and shareholders. It will see a lower portion of bonuses paid in cash, and shares granted under the 2010 bonus scheme delivered annually from 2012-15.
Although exempt from the EU bonus rules at home, Credit Suisse and larger rival UBS, both of which have big international investment banking divisions, have made moves to bring in restrictions on pay after 2008’s banking crisis.
City A.M. Reporter