Higher salary; bonus cuts

2 March 2010 By George Hay Follow @gfhay

Some of the global bank’s investors will keep opposing a salary increase for its chief executive without something in return. Pay rises may be justified, especially as global peers pay more. But the bank should calm shareholders by balancing a higher salary with lower bonuses.

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Context News

HSBC has told investors that it has approved a salary increase for Michael Geoghegan, its chief executive, following his move to Hong Kong and new role setting global strategy.

But the global bank revealed in its annual report on March 1 that Geoghegan did not consider it appropriate to accept such an increase at present.

HSBC's nonexecutive directors have unanimously agreed that Geoghegan's remuneration, including salary, will be brought up to internationally competitive levels within the next twelve months.

Geoghegan is currently entitled to an annual bonus of four times his £1.07 million pounds salary if he meets all his targets. He is also entitled to performance shares with a face value at the time of award of seven times salary, as part of a longterm incentive plan.

The chief executive of Lloyds Banking Group is entitled to an annual bonus equal to 2.25 times salary.

HSBC annual report

Context News

HSBC has told investors that it has approved a salary increase for Michael Geoghegan, its chief executive, following his move to Hong Kong and new role setting global strategy.

But the global bank revealed in its annual report on March 1 that Geoghegan did not consider it appropriate to accept such an increase at present.

HSBC's nonexecutive directors have unanimously agreed that Geoghegan's remuneration, including salary, will be brought up to internationally competitive levels within the next twelve months.

The chief executive of Lloyds Banking Group is entitled to an annual bonus equal to 2.25 times salary.

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