By John Letzing
ZURICH-- Credit Suisse Group AG on Friday said departing Chief
Executive Brady Dougan received a pay cut for 2014, a year when the
Swiss bank struggled to maintain its profit as it was dogged by
legal issues.
Zurich-based Credit Suisse said on Friday that Mr. Dougan, who
has led the bank since 2007 and is due to step aside at the end of
June, received 9.7 million Swiss francs ($9.8 million) in total
compensation for 2014, compared with 9.79 million francs in the
prior year.
Of Mr. Dougan's pay, 2.5 million francs consisted of base
salary, consistent with the prior year, and about 5.3 million
francs came in the form of incentive awards--a reduction from the
6.2 million francs in incentive awards for 2013.
The disclosure of Mr. Dougan's pay reduction comes a week after
rival Swiss bank UBS AG, which has also been hindered by legal
issues, said its CEO Sergio Ermotti received an increase in total
compensation for 2014--to nearly 11.2 million francs, from 10.7
million francs a year earlier.
Credit Suisse noted that the results at its so-called
nonstrategic businesses--those that the bank is trying to wind
down--missed their performance targets last year, mainly because of
heavy legal provisions. Still, the bank said Mr. Dougan delivered a
strong performance in 2014, as he oversaw a reduction of Credit
Suisse's balance sheet and costs, and achieved the bank's target
for building up its capital cushion by the end of the year.
Credit Suisse announced earlier this month that its
long-standing chief executive would be replaced by Tidjane Thiam,
the current CEO of U.K. insurer Prudential PLC. Mr. Thiam will join
an 11-member executive board that collectively received 64.06
million francs in compensation for last year, compared with 64.77
million francs in the prior year for what was then a nine-member
group.
Credit Suisse had previously disclosed that executive board
members including Mr. Dougan would have their bonuses for last year
reduced by the equivalent of 20%, tied to the bank's settlement
last May of a U.S. probe into whether it had helped American
clients evade taxes. Credit Suisse agreed to pay $2.6 billion to
settle the matter and pleaded guilty to a criminal charge of
conspiring to aid tax evasion.
Credit Suisse has said previously those bonus cuts were linked
to their responsibility for "safeguarding the long-term reputation
and professional integrity" of the bank.
Overall, Credit Suisse reported a 19% decline in net profit for
2014 compared with 2013, despite net revenue rising 2%.
The bank's 2014 profit figure was retroactively reduced last
month, as it disclosed an additional 277 million francs in legal
provisions related to the sale of mortgage-backed securities in the
U.S. before the financial crisis.
A number of legal actions in the U.S. have alleged that Credit
Suisse misrepresented the quality of the loans in its
mortgage-backed securities sold during the lead up to the crisis.
The bank said a number of claims against it have been dismissed or
settled, while it continues to contest others.
Write to John Letzing at john.letzing@wsj.com
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