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Swiss financial giant Credit Suisse cut CEO Brady Dougan's salary by 55% in 2011, the bank revealed today, in a year that saw its net income slump 62%, stock tumble 41% and profits at its investment banking unit wiped out.
LONDON, UK – Credit Suisse, Switzerland’s second-biggest bank, slashed total compensation for its chief executive, Brady Dougan, by 55 percent in 2011, after the financial giant reported its first quarterly loss in three years.
Dougan still made 5.8 million Swiss francs ($6.4 million) last year, split between a basic salary of 2.5 million francs and Credit Suisse shares worth 3 million francs, according to the Zurich-based bank’s annual report published Friday.
The sharp reduction in pay follows Credit Suisse’s poor performance in 2011, when net income fell 62 percent, its stock tumbled 41 percent, and profits at its investment banking unit were wiped out, the BBC reports.
The bank reported a net loss of 637 million francs in the fourth quarter of 2011, compared with profits of more than 840 million during the same period a year earlier, according to The New York Times.
In its report, Credit Suisse justified the reduced pay package for Dougan, saying:
“This level of compensation reflects the lower financial performance compared to the prior year and the lower share price and also recognizes Mr Dougan’s contribution to the long-term execution of the strategy and positioning of the firm in a changing regulatory and investment environment,” it said.
The best paid executive at the bank was the head of Credit Suisse’s asset management business, Robert Shafir, who earned $9.3 million.
Friday’s pay disclosures are likely to attract the ire of investors, particularly in Switzerland where there are increasing calls for Credit Suisse to trim its expensive investment bank, Reuters reports.
“The compensation is too high in proportion to the drop in the bank’s financial results,” Roby Tschopp of Swiss shareholder activist group Actares told the news agency, criticizing Dougan’s award of a shared-based bonus larger than his fixed salary.
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