Credit Suisse shareholders reject executive pay request

Credit Suisse shareholders queued up to vent their anger at executives during Credit Suisse's final AGM. © Keystone / Michael Buholzer

Credit Suisse shareholders expressed their frustration at the bank’s impending demise by voting down a proposed CHF34 million ($37 million) pay package for managers.

On Tuesday, the bank held the last ever Annual General Meeting of its 167-year history before fusing with rival UBS.

+ Where did it all go wrong for Credit Suisse?

Dozens of small shareholders took to the stage to express their anger at the bank’s leadership and to protest the fact that their shares have crashed in value to below a single franc.

They voted through proposals for chair Axel Lehmann and other board members to continue leading the company. Shareholders also agreed they will be paid a maximum of CHF13 million.

But the proposal to award managers, including CEO Ulrich Körner, up to CHF34 million in basic pay failed to muster the necessary 50% of votes – only 48.23% of shareholders agreed.

“We’ll have to think about how to respond to that,” said Lehmann in response. The board will now have to come up with a new package that is acceptable to shareholders.

Following years of scandals and crippling losses, the Swiss government invoked emergency powers to push through the sale of Credit Suisse to rival bank UBS on March 19.

But Credit Suisse will still operate as a separate company for the next few months until the takeover is complete.

+ How to fuse two Swiss banking giants

Switzerland’s second largest bank will eventually be folded into UBS, marking the final chapter in the history of Credit Suisse, which was formed in 1856.

Addressing shareholders at the AGM on Tuesday morning, Lehmann said: “It’s a sad day for you and for us. We failed to replace the scandals of the past, and many negative headlines, with positive prospects.”

He apologised on behalf of himself and others who were “behind the wheel” when the bank was forced to concede defeat last month.

CEO Körner said the emergency UBS rescue was the only option available to the embattled bank in March. “The collapse of Credit Suisse would have been disastrous. Not just for us but for the global economy.”

Shareholders were not asked to discharge the board from its legal responsibility over the last 12 months. Another item removed from the agenda was a proposal to award executives a restructuring bonus as the turnaround plan was never completed.

Last October, the bank announced it would shed 9,000 staff and many of its riskier assets. Investors also injected an extra CHF4 billion into Credit Suisse to keep it afloat.

But the bank posted a CHF7.3 billion loss in 2022 as clients lost faith and withdrew CHF123 billion in assets.