ZURICH (Reuters) - UBS UBSN.VX became the latest bank to face the anger of its shareholders over executive pay on Thursday, as investors queued up to voice their complaints in a packed meeting that echoed recent protests at Credit Suisse and Barclays.
“Big banker pay hasn’t been tamed at all. It’s as though UBS hasn’t learned any lessons at all from the past crises,” Brigitta Moser-Harder, a small investor, told Reuters on the sidelines of the meeting attended by around 3,400 shareholders.
Moser-Harder was among more than two dozen shareholders signed up to address the meeting and said she would vote against UBS’s pay plan, which the bank will put to a non-binding shareholder vote.
Anger is rife in the population at large over multi-billion dollar pay deals in an industry whose excesses were at the centre of the recent global economic downturn, and now shareholders are also becoming more vociferous.
Last week, nearly one third of Credit Suisse CSGN.VX investors opposed the bank’s pay levels, while 26.9 percent voted against salaries for top executives at Barclays (BARC.L).
Swiss shareholder groups Ethos and Actares are urging investors to vote down what they see as excessive pay packages at UBS, including that of former Bundesbank head and incoming chairman Axel Weber.
A rebellion by a large group would be a relative novelty in Switzerland where vocal criticism of companies more commonly comes from small retail shareholders.
Evidence of recovery at UBS’s flagship private bank and 4 percent rise in the stock price on Wednesday may stave off some shareholder anger.
But Ethos, influential because it makes recommendations for Swiss pension funds, is particularly incensed over Weber’s deal, which includes a 4 million Swiss franc ($4.40 million) signing-on bonus.
“The Ethos Foundation urges shareholders to exercise their voting rights at the May 3 shareholder meeting in order to send a signal to the board of directors regarding the remuneration system and the inadequate system of internal control,” it said.
Weber is set to become chairman ahead of schedule when Kaspar Villiger steps down a year earlier than planned following a rogue trading scandal, another issue likely to be raked over by shareholders.
UBS, which ended 2011 with roughly 200 more employees on the year, cut its bonus pool by 40 percent to 2.57 billion Swiss francs. Investment banking chief Carsten Kengeter agreed to forgo his 2011 bonus after the trading scandal. As a result, UBS does not have to reveal Kengeter’s pay.
But shareholders may bring up the hiring of Andrea Orcel, Bank of America Merrill Lynch’s (BAC.N) top European dealmaker who reportedly earned $34 million at that bank at the height of the financial crisis in 2008.
Orcel will co-run UBS’s investment bank with Kengeter. The details of Orcel’s pay package with UBS are not public knowledge.
With 9.2 million Swiss francs, U.S.-based brokerage head Robert McCann is UBS’s top earner, beating Chief Executive Sergio Ermotti, who earned 6.4 million.
That compares with Credit Suisse boss Brady Dougan, who saw his pay more than halved to 5.8 million francs amid a 41 percent tumble in the bank’s stock.
Neither Villiger nor Ermotti addressed criticism over pay in their remarks to shareholders.
($1 = 0.9086 Swiss francs)
Editing by David Cowell and Mark Potter