The Swiss Times - Swiss News in English

ZKB bonuses remained stable in 2023 as promised

The "bonus freeze" at Zürcher Kantonalbank (ZKB) has had an effect: despite the explosion in profits at the bank, no more bonuses were paid out to ZKB employees in 2023. Meanwhile, the new ZKB CEO Urs Baumann reached the salary level of his predecessor.

Variable remuneration remained virtually constant in 2023, Switzerland's largest cantonal bank stated in its annual report published on Wednesday. They rose by 1.3 percent to CHF 353.7 million - and that with a 5 percent higher headcount of 5,304 employees.

That was the intention: ZKB announced last fall that it would freeze bonus payments at the 2022 level. This was intended to "decouple" the variable remuneration from the increase in profits, it said at the time. In 2023, ZKB had achieved a 17% increase in profit to a new record of CHF 1.24 billion.

Reaction to political discussion

This is because the jump in profits had become apparent thanks to the favorable interest rate environment - and thus also a significant increase in bonuses. With the revision of the remuneration model, the ZKB Bankrat also reacted to political discussions.

In the wake of the CS collapse, the cantonal council discussed a salary cap for the ZKB general management, but ultimately rejected it. "We heard this criticism from our owner and took action," explained ZKB Bank President Jörg Müller-Ganz.

On the other hand, ZKB has once again weighted the fixed salary component more heavily in 2023 - which was also intentional. According to the annual report, basic salaries rose by a total of 1.5 percent. The increases were primarily used to "bring employees closer to market standards", according to the remuneration report.

Overall, personnel expenses increased to CHF 1.14 billion in 2023. This is 2.1 percent more than in 2022.

2.85 million for the CEO

ZKB CEO Urs Baumann, who has been in office since September 2022, received total compensation of CHF 2.85 million last year. Of this, 2.65 million was made up of his basic salary and bonuses, with the remainder made up of pension benefits and other remuneration.

By comparison, Baumann's predecessor Martin Scholl received total compensation of CHF 2.79 million in 2022 - including a pension buy-out. Scholl had left ZKB at the end of August - so he earned the almost 2.8 million in just eight months. Thanks to the "explosion" in variable remuneration, Scholl had thus earned more than in the entire previous year.

ZKB had also announced that it would align the remuneration model for senior managers more closely with long-term economic interests. This can be seen in the deferred bonuses, which are only paid under certain conditions: While so-called "entitlements" amounting to CHF 487,500 are part of the total package for the new ZKB CEO Baumann, they only amounted to CHF 337,500 for Scholl in the previous year.

Meanwhile, the total remuneration paid to the nine members of the ZKB Executive Board amounted to CHF 19.0 million in 2023, compared with CHF 19.6 million in 2022.

The total remuneration of the Bank's Governing Board and the other members of the Bank Council is reported at 1.89 million (+1.4%), with the highest individual remuneration going to Chairman Jörg Müller-Ganz at 0.45 million.


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