RBC's Nixon takes pay cut after U.S. bank loss

Mon Feb 6, 2012 4:43pm EST
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TORONTO (Reuters) - Royal Bank of Canada (RY.TO: Quote) paid Chief Executive Gordon Nixon C$10.1 million ($10.1 million) last year, an 8.2 percent decrease from 2010 due to a loss taken from the sale of its U.S. branch banking operation, RBC said on Monday.

RBC, Canada's biggest bank, notched record earnings from its domestic banking and wealth management divisions last year, but took a C$1.6 billion earnings hit from the sale of its U.S.-based bank to PNC Financial Services Group (PNC.N: Quote).

The bank's board "weighed both RBC's record earnings from continuing operations and the impact of the sale of the U.S. retail bank," in arriving at the figure, RBC said. The compensation was disclosed in the bank's annual proxy circular.

RBC's total net income for the year was C$4.9 billion, while income from continuing operations was C$6.7 billion.

Canada's banking sector emerged from the financial crisis in relatively strong shape and the country's banks have been named the world's soundest by the World Economic Forum for four straight years.

While Wall Street pay packages have historically dwarfed those on Bay Street, the financial crisis and resulting scrutiny on U.S. executive compensation has Canadian bank CEOs earning in the same ballpark as some of their U.S. counterparts.

Nixon's pay was just short of the $10.5 million earned by Morgan Stanley (MS.N: Quote) CEO James Gorman last year, but trailed the $18.8 million pay package of JPMorgan (JPM.N: Quote) CEO Jamie Dimon. Both U.S. CEOs took sharp cuts from the previous year.


Nixon's pay, which compares with 2010 compensation of C$11 million, consists of a C$1.5 million base salary, along with C$1.75 million in bonuses and C$6.85 million in deferred share units and stock options, the bank said.   Continued...

<p>Gordon Nixon, President and Chief Executive Officer of Royal Bank of Canada (RBC) Financial Group, speaks during the Atlantic Council conference on "The Financial Crisis: Lessons Learned from Canada and the Way Forward" at the Canadian Embassy in Washington November 16, 2011. REUTERS/Kevin Lamarque</p>