Julius Baer Awards CEO Boris Collardi $5.9 Million for 2014Giles Broom
Julius Baer Group Ltd. paid Chief Executive Officer Boris Collardi 5.7 million Swiss francs ($5.9 million) last year as Switzerland’s third-largest bank for affluent families boosted profit from its expanding network of clients.
Collardi’s compensation figure, which includes salary, cash bonus and shares, was calculated in accordance with new Swiss standards requiring the bank to reclassify some performance-related components of the package, the Zurich-based bank said Monday. It’s therefore not directly comparable with the 5.9 million francs the CEO was awarded for 2013, according to Julius Baer’s annual remuneration report.
Julius Baer also published a figure of 6.4 million francs representing what Collardi would have earned in 2014, using the old method for calculating the package, including deferred bonuses. On that basis, his pay would have increased. Shareholders will have a chance to comment on the pay report at their annual meeting on April 15.
Swiss publicly traded companies are starting to implement rules changing how compensation is reported and giving shareholders a say on pay after a 2013 referendum supported an initiative against “fat-cat” salaries. Julius Baer introduced changes to its compensation plan for 2013 after investors raised concerns and rebuffed the CEO’s pay in an advisory vote in 2012. Collardi’s pay was approved last year in a non-binding shareholder vote.
Collardi, 40, has overseen an 89 percent increase in client assets under management at Julius Baer through acquisitions and an expansion in private banking networks in Asia since he took the helm in 2009. His 224,200 shares in Julius Baer -- more than double the amount he is required to hold under company rules -- are worth more than $11 million. Julius Baer climbed 6.9 percent in 2014 and is up 9.3 percent this year.
At this year’s AGM, shareholders will once again have a consultative, non-binding vote on the bank’s remuneration report, according to documents published on Monday. Investors will have separate binding votes on pay, including on the cash bonuses for the management for 2014, share-based compensation for 2015 and salary pot for 2016.
Julius Baer proposed awarding the executive board 7.3 million francs in aggregate cash-based bonuses for 2014, of which 2.2 million francs is allocated to Collardi. Management will also receive 6.2 million francs in variable share-based compensation in the 2015 financial year, of which more than 2.5 million francs will go to Collardi. Fixed compensation of 4.7 million francs a year, excluding social contributions, will be divided between the six-person executive team in 2015 and 2016.
Collardi increased his loans from Julius Baer by 751,000 francs last year and was borrowing 4.5 million francs at the end of December, according to the remuneration report.
Chairman Daniel Sauter’s total compensation was little changed at 1.1 million francs for 2014. Sauter’s predecessor Raymond Baer, who stepped down from the board of directors in April 2012 to head a special committee coordinating the bank’s efforts to deal with a U.S. government tax probe, saw his annual salary cut by more than a third to 160,000 francs, effective March 1 2014, “to reflect changes in the required workload,” according to the report.
While Julius Baer doubled profit last year after integrating non-U.S. Merrill Lynch businesses acquired from Bank of America Corp., it expects to pay a fine as part of a settlement this year to resolve the 3 1/2-year-long U.S. probe.