The leaders of the seven major Canadian banks and Desjardins Group saw their total compensation total close to $ 67.4 million in 2016 as part of a year in which profits were up For almost all financial institutions.
This information is contained in the financial documents filed with regulatory authorities by financial institutions in the last few weeks and consulted by La Presse canadienne. This amount is up by about 2.7 per cent over the previous year.
Total compensation combines several elements, such as base salary, bonuses, stock-based awards, stock options, various bonuses and contributions to pension plans.
David McKay, President and Chief Executive Officer of Royal Bank, posted the highest total salary of $ 12.25 million last year. The top bosses of Banque Nationale, Louis Vachon, and Laurentian Bank, François Desjardins, came in sixth and seventh respectively.
With the exception of National Bank, all other financial institutions saw their net profits rise over the past year, which is largely responsible for the increase in total executive compensation.
“It’s a compensation mechanism,” says Claude Francoeur, a full professor in the accounting department at HEC Montréal. Compensation plans encourage more profits. It goes together. An increase in profits almost always results in higher wages. ”
“The question of whether it is reasonable profit and wages is a question of point of view,” he adds.
Mr. Francoeur points out that “a good part” of the total salary of the big bosses of the banks is based on stocks and options. Thus, the professor points out, the return represents a large part of their remuneration.
The Movement for Education and Defense of Shareholders (Médac) focuses more on the difference between the total remuneration of the officer who receives the highest salary in relation to the average of the employees.
The organization points out that Scotiabank was where the gap was the highest, stating that its CEO Brian Porter was paid a total of 146 times higher than the average salary of the institution’s employees . All other banks were able to keep this ratio below 100, observed the Medac.
“In the banking sector, the ratio was often over 100, which was deplorable,” says Medac coordinator Willie Gagnon. When the ratio was in a range of between 50 and 60, we were nicer with them. ”
Mr. Gagnon pointed out that Laurentian Bank “behaved better”, since its great boss, François Desjardins, was receiving 34 times the average wage of an employee.
“Between 30 and 40, it’s really not worse,” commented Mr. Gagnon.
Here is an overview of the total salary awarded to each of the leaders of the banks last year:
Louis Vachon saw his total salary stand at $ 8.1 million in 2016, up 23 percent. This increase, however, reflects a downward adjustment of $ 1.27 million on the value of its pension plan in 2015. Excluding this item, direct compensation – excluding the pension plan – of the large boss Of National Bank was $ 7.57 million. Base salary remained at $ 1.12 million.
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Laurentian Bank of Canada:
In his first year at the helm of the institution, François Desjardins received total compensation of $ 2.99 million. Her base salary was $ 549,910, up 47 per cent. In comparison, he had received $ 3.1 million in total compensation in 2015 when he was Executive Vice-President of Laurentian Bank and was in charge of the B2B subsidiary of broker-dealers and financial advisors.
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At the helm of the cooperative for about a year, Guy Cormier received a total salary of $ 2.07 million. His base salary was $ 774,768. The value of its annual incentive plan was $ 672,266 and the value of its pension plan was $ 626,343. Last year, Monique Leroux’s total compensation, which ended his term as President of Desjardins, was $ 3.9 million. This amount included a base salary of $ 1.27 million.
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David McKay received a total salary of $ 12.25 million in 2016, compared to $ 11.66 million the previous year. The base compensation of the President and Chief Executive Officer of Canada’s largest bank increased from $ 1.3 million to $ 1.46 million on a year-over-year basis.
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Brian Porter received total compensation totaling $ 11.76 million in the last fiscal year, up 7.9 per cent from 2015. As in the past three years, his base salary has remained at $ 1 million.
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The total compensation of President and Chief Executive Officer Bharat Masrani was $ 10.34 million last year, the year in which his base salary was stable at $ 1 million. By 2015, his overall salary had been a little higher, at $ 10.7 million.
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Bank of Montreal:
William Downe’s total compensation increased by 4.6 per cent to $ 10.64 million in 2016. His base salary was $ 1.98 million, up 5.61 per cent. His annual performance bonus, equity awards and options also rose.
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President and CEO Victor Dodig received an overall salary of $ 9.1 million in 2016, an increase of 7.6 percent. This increase is mainly due to the value of stock-based awards and options. Like some of his colleagues, his base salary was $ 1 million.