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Bloomberg
DBS Holdings Group Ltd. cut Chief Executive Officer (CEO) Piyush Gupta’s total 2020 compensation by 24% after Singapore’s largest lender posted its first annual drop in profit for four years.
The bank slashed Gupta’s bonus by 27%, resulting in a 24% decline in his overall compensation to S$9.2 million ($6.8 million) for the 2020 performance year, down from S$12.1 million a year earlier, DBS said in its annual report on Monday. The reduction reflects the “extremely challenging operating environment,†it said, as the global pandemic endured.
DBS also cut compensation of other senior bankers. Excluding Gupta’s pay, median decline in total remuneration and variable pay of its management committee members for both 2019 and 2020 was 12%, and 17%,
respectively, the report said.
The Singapore-based bank isn’t alone in cutting salaries as global lenders tackle the impact of the coronavirus pandemic. Standard Chartered Plc’s Bill Winters saw his total pay slashed 29%, while Barclays Plc’s Jes Staley’s was reduced by about a third. DBS’s pay cuts follow the bank’s first annual earnings decline in four years as a contraction in interest income and a rise in provisions for potential soured loans curbed profitability.
While commending Gupta’s ability to weather the economic slowdown and grow bank’s franchise in India and China, DBS said the cut reflected “difficult operating environment, general cutbacks across the bank and the reduction in bank’s profits.†The bank’s senior management’s aggregated total remuneration last year was S$63.2 million, including the CEO. That was 14% lower than in 2019, it said.
Gupta said the bank’s “organic†expenses for 2021 will be kept at 2019 levels even as the bank processes higher business volumes.
Still, more businesses are also coming to DBS via its digital channels as more clients are turning to online banking during the pandemic, Gupta said. The lender is training its workforce to cope with the changes that come with digitalisation, and has identified more than 7,200 employees to be given skills in areas including data and analytics, machine learning and artificial intelligence, he said.
DBS’s headcount rise 16% to 33,002 in 2020 from a year earlier. That was partly due to its takeover of Lakshmi Vilas Bank Ltd. in India, which was completed in November. Excluding the Indian bank’s staff and insourcing, headcount grew 2%, it said last month.