HSBC scraps big rise for its CEO

| February 24, 2010 | 0 Comments

According to reports, banking giant HSBC has bowed to shareholder pressure and abandoned plans to raise its chief executive’s salary.

The Financial Times said the bank had consulted shareholders on proposals to raise Michael Geoghegan’s salary by 36% to £1.4 million ($2.2 million).

The FT also reported that the bank had planned to up the salary of Finance Director, Douglas Flint, from £700,000 to £900,000.

However, a spokesperson for the bank declined to comment but did say that the bank would publish full remuneration details of its senior executives in its annual report next month.

The spokesperson pointed out HSBC’s executive directors all waived bonuses in 2008, had not received any taxpayer bailout money and said it has not raised salaries for three years.

However, while HSBC is one of the few banks that has survived the financial crisis better than many of its rivals, many will still deem the substantial pay rises as inappropriate, particularly as many believe their risks led to the recession.

The news comes just a few days after other chief executives of major banks have waived their annual bonuses.

Eric Daniels, chief executive of Lloyds Banking Group, will waive his £2.3 million annual bonus, while Royal Bank of Scotland chief executive, Stephen Hester, opted not to take his £1.6 million bonus.

Barclays chief executive John Varley and president Bob Diamond both agreed to sacrifice bonuses for the second year in a row, in light of the “intense public interest and concern” over bankers’ pay.

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