HSBC Holdings is to hand its new chief executive a pay package potentially worth more than £15m as part of an overhaul of its bosses’ remuneration triggered by the government’s scrapping of the EU bonus cap.
Sky News has learnt that Europe’s biggest lender, which has a market capitalisation of more than £147bn, is putting the finishing touches to an overhaul of CEO Georges Elhedery’s pay deal ahead of its annual results this month.
HSBC is understood to have been consulting leading shareholders on the plans, which will involve increasing his maximum pay to just over £15m, in recent weeks.
City sources said the proposals would see Mr Elhedery’s fixed pay roughly halved, but with significantly more generous maximum variable pay awards.
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When he was named as Noel Quinn’s successor last July, HSBC said he would receive a base salary of £1.38m, a £1.7m fixed pay allowance, a maximum annual bonus opportunity of roughly £3m and a maximum long-term share award of close to £4.5m.
That amounts to a total of approximately £10.5m.
Investors said they have been briefed that Mr Elhedery’s new package would scrap the fixed pay allowance altogether but incorporate higher multiples of bonus and long-term share awards.
The bank’s new finance chief, Pam Kaur, will also see her remuneration package amended along similar lines.
The changes have been drawn up by Dame Carolyn Fairbairn, the former CBI director-general, who chairs HSBC’s boardroom pay committee.
HSBC’s move to overhaul its directors’ remuneration policy, which is expected to be put to a vote of shareholders in the spring, follows that of its UK banking peer, Barclays.
Sky News revealed last month that Barclays was increasing CEO CS Venkatakrishnan’s maximum pay package to just over £14m.
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