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Credit Suisse (CS) CEO's Compensation for 2017 Falls 5%

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Credit Suisse Group’s CS CEO, Tidjane Thiam witnessed a 5% decline in his 2017’s compensation compared with the prior year. However, the compensation committee indicated that the CEO’s pay might increase in the future if the company’s performance meets expectations.

For 2017, Thiam received CHF 9.7 million as total compensation, of which, CHF 3.47 million is fixed compensation and CHF 3.98 million represents short-term incentive awards. Also, he received CHF 2.25 million as long-term incentive (LTI) awards, which he had voluntarily proposed to reduce by 40%.

Group’s compensation came down 4% from 2016 to CHF 69.9 million as a result of voluntary reduction to the 2017 LTI award proposal.

The reduction is salaries were on account of Thiam’s three-year restructuring plan to boost the company’s performance. Having entered the last phase of his plan, Thiam remains confident of delivering profits in the years ahead.

The chairman and CEO of Credit Suisse in the annual filling said, “2017 was a year of continued transformation for Credit Suisse as we delivered on key strategic objectives and made progress against our plan to achieve profitable and compliant growth.”

Amid persistent pressure from the shareholders for improving the company’s financial position, Thiam was successful in driving Credit Suisse into a healthier position in 2017 as reflected by its stronger capital ratios, increased revenues and lower expenses.

Nevertheless, the company incurred annual loss for 2017 due to a one-time charge related to the U.S. tax reform. Also, investors have reached the end of their patience and another annual loss might not be in Thiam’s favor. Moreover, involvement in certain legal hassles continues to hurt the company’s reputation.

Shares of Credit Suisse have gained 11.8% over the past year, outperforming 10% rally for the industry it belongs to.

The stock carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the same space are ING Group, N.V. ING, BanColombia S.A. CIB and The Toronto Dominion Bank TD. All these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for ING Group has been raised 2.4% for the current year, in the last 60 days. The company’s share price has jumped 11.4% in the past year.

BanColombia has witnessed 7.3% upward earnings estimate revision for 2018, in the last 60 days. Its share price has risen 5.9% in the past year.

Toronto Dominion’s shares have gained 16% in a year and its earnings estimates for 2018 have moved up 5% in the last 60 days.

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