(Bloomberg) -- UBS Group AG Chairman Colm Kelleher said he had underestimated the negative public response to Chief Executive Officer Sergio Ermotti’s 14.4 million Swiss franc ($17.1 million) pay package in 2023.
In an interview with Swiss newspaper SonntagsBlick, Kelleher said there was almost exclusively positive feedback on Ermotti and his work to steer UBS through the integration of failed rival Credit Suisse, until the bank announced the CEO’s remuneration.
“The mood flipped like a light switch,” Kelleher told the Swiss paper.
While falling well short of Wall Street levels, Ermotti’s compensation for the nine months of 2023 after he returned to lead the Zurich-based lender made him the best-paid European bank CEO. The award caused concern in Switzerland, with finance minister Karin Keller-Sutter saying it exceeds “the imagination of any normal citizen.”
Kelleher defended Ermotti, noting that his pay was about 10% more than his predecessor, despite his wider mandate of integrating Credit Suisse.
Ermotti works “around the clock, seven days a week, to make something good come out of this completely disastrous situation that we found in March 2023,” when the government brokered a deal for UBS to rescue Credit Suisse, Kelleher said.
The UBS chairman may have “underestimated how parts of the public would react to this compensation,” he added.
Regarding the role of Switzerland’s financial market regulator, Finma, in the downfall of Credit Suisse, Kelleher said he was “astonished” to read letters from the banking regulator to the Credit Suisse board of directors.
“The fact that Credit Suisse received these letters and did nothing or too little is unbelievable,” he said.
©2024 Bloomberg L.P.
