Citigroup CEO Michael Corbat was paid $17.6 million last year, his first full year on the job.
That’s an increase of almost 42 per cent from his $12.4 million compensation package in 2012, when he was promoted to the position of CEO in October, replacing Vikram Pandit. Before getting the top job at Citi, Corbat was in charge of the bank’s operations in Europe, the Middle East and Africa.
Corbat’s pay package included $1.5 million in salary, a cash bonus of $5.2 million, stock awards valued at $7.9 million and incentive pay totalling $2.9 million, according to a regulatory filing from Citi Wednesday.
Citi’s net income climbed 11 per cent to $13.5 billion in 2013, after stripping out the effects of accounting charges, as the bank cut operating costs and its revenue grew.
But Citi also said Wednesday that it could reduce pay for some employees this year and try to reclaim compensation it paid in 2013 after discovering fraud at a Mexican subsidiary, Banamex. The company last month said it cut its 2013 earnings by $235 million because of the fraud and has already reduced expenses associated with a Banamex compensation plan by $40 million.
The Associated Press formula calculates an executive’s total compensation during the last fiscal year by adding salary, bonuses, perks, above-market interest that the company pays on deferred compensation and the estimated value of stock and stock options awarded during the year. The AP formula does not count changes in the present value of pension benefits. That makes the AP total slightly different in most cases from the total reported by companies to the Securities and Exchange Commission.
The value that a company assigned to an executive’s stock and option awards for 2012 was the present value of what the company expected the awards to be worth to the executive over time. Companies use one of several formulas to calculate that value. However, the number is just an estimate, and what an executive ultimately receives will depend on the performance of the company’s stock in the years after the awards are granted. Most stock compensation programs require an executive to wait a specified amount of time to receive shares or exercise options.