Citigroup announces executive pay reforms

22 February 2013

Citigroup has announced fundamental changes to its executive pay structure following a shareholder revolt.

Last year, investors in the major US bank rejected the 2011 pay plan of ex-chief executive officer (CEO) Vikram Pandit on the basis that it was too easy for him to achieve a remuneration package of up to $40 million, including a basic salary of $15 million.

This resulted in the financier's board ousting Mr Pandit and replacing him with Michael Corbat and, after overseeing discussions with around 20 shareholders yesterday (21 February), details of the new CEO's pay package have emerged.

Mr Corbat will therefore receive $11.5 million for his work in 2012 - a figure that includes a cash bonus of $4.18 million and $3.14 million in performance share units.

"We are introducing a new compensation structure that more strongly connects compensation with performance, emphasizes strong risk management and is both competitive and in line with regulatory standards," the CEO stated.

By Gary Cooper

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