UBS CEO earned salary of CHF14.4 million in 2023

Ermotti was appointed on April 1, 2023 to lead the UBS takeover of former rival Credit Suisse. KEYSTONE/© KEYSTONE / LAURENT GILLIERON

UBS CEO Sergio Ermotti received a tidy salary on his return to the bank last year, earning CHF14.4 million ($15.9 million) over nine months in 2023.

Ermotti was appointed on April 1, 2023 to lead the process of integrating former rival Credit Suisse, which was taken over by UBS in dramatic fashion in March 2023. Ermotti’s predecessor Ralph Hamers earned CHF12.6 million as CEO for the whole of 2022.

According to UBS’s annual report published on Thursday, Ermotti’s salary was comprised of CHF2.1 million fixed salary and CHF12.3 million variable salary payments, with the latter referred to as a performance bonus.

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Expanded board post-takeover

A total of CHF140.3 million was paid to the entire executive board of Switzerland’s largest bank in 2023, compared to CHF106.9 million the year before. Of this, CHF108.3 million was attributable to performance bonuses, compared to CHF81.1 million in 2022.

UBS said that this increase reflected the change in structure of the group’s executive board to support the Credit Suisse integration, including four additional members. At the end of 2023, its executive board had 15 members.

“The payment structure for all employees, including the executive board, remained largely unchanged despite the acquisition of Credit Suisse in 2023,” said UBS, adding that neither the positive nor the negative financial effects of the takeover had been included in the report.

More responsibilities for board directors

Colm Kelleher, who has been chairman of UBS’s board of directors since April 2022, will receive CHF4.7 million for his second year in the role until the next annual general meeting on April 24. In his first year, he received CHF4.8 million.

The entire board of directors, consisting of 12 members, earned CHF15.2 million in 2023, including subsidiary fees, significantly more than the CHF12.6 million in 2022.

Following the takeover of Credit Suisse, the roles of certain members of the board were expanded in 2023 to include additional duties on the boards of key subsidiary firms, according to the bank’s report. It said that these appointments were important to ensure strong oversight of the subsidiaries in line with UBS Group’s governance principles, as well as facilitating the integration of Credit Suisse entities into UBS.

Loyalty bonuses

In addition, loyalty bonuses were paid in 2023 to encourage employee retention, which UBS said was common in the event of a takeover to retain people in key positions.

Overall, the bank said that the retention payments, which totalled CHF736 million, were rather low compared to the industry standard for an takeover of this size. According to the bank, they accounted for 3% of total personnel costs in 2023.

Meanwhile, there was no separate remuneration report for the Credit Suisse AG subsidiary as this is now part of the UBS Group, the bank said, and subsidiaries are not obliged to report separately.

Adapted from German by DeepL/kp

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