Board of Swiss bank agree to pay cut

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Credit Suisse has announced a 25 per cent boardroom pay cut and reduced bonuses for other top staff while also setting out a range of measures to tackle the surge in the Swiss franc.

The pay cuts are the Zurich-based bank’s response to the more than $2.5bn (£2bn) in penalties agreed with US authorities last year for its role in helping Americans to evade taxes, it said in fourth-quarter results yesterday.

As global banks face renewed scrutiny after HSBC admitted failings by its Swiss private bank that may have allowed customers to dodge taxes, Credit Suisse said its overall 2014 bonus pool would be cut by 9 per cent, while directors cut their own pay by a quarter and top management agreed to a 20 per cent bonus cut.

Credit Suisse has been a lightning rod for criticism over executive remuneration since its decision to pay chief executive Brady Dougan nearly 90 million Swiss francs ($96.7m) in 2010.

Dougan was at pains to point out yesterday that though the bank’s staff had worked hard, the hefty US penalties could not be ignored.

“It was a difficult issue to work through,” he said.

“The executive board and the board thought that, voluntarily, we should reduce our compensation to reflect the impact of the settlement’s cost on the firm’s financials for 2014.”