Singapore, Feb 7 (PTI) Singapore’s leading corporate group DBS on Wednesday said that it has cut Chief Executive Officer Piyush Gupta’s variable pay by 30 per cent as a result of the digital disruptions experienced by the bank’s customers last year.
This amounted to 4.14 million Singaporean dollars (USD 3.08 million), announced by DBS as part of its quarterly earnings statement.
Collectively, the CEO and other members of the group management committee took a 21 per cent reduction in their variable pay, Channel News Asia reported.
“The Board determined that the variable compensation for the CEO and other members of the Group Management Committee should be cut to hold them accountable for the series of digital disruptions during the year (2023),” DBS said.
Singapore’s largest lender suffered a series of disruptions to its digital banking services last year, culminating in the Monetary Authority of Singapore (MAS) barring DBS from any acquisitions of new business ventures for six months.
DBS was also made to pause non-essential IT changes for six months and was not allowed to reduce the size of its branch and ATM networks in Singapore.
Gupta said on Wednesday that the bank’s senior management team has shown that it is taking responsibility for the series of service disruptions last year.
“We announced that we’re taking accountability at the senior management, starting with me, but also the rest of my senior management team. I think that’s a good element of governance,” Gupta said.
“If you can establish accountability and figure that people take responsibility for making fixes, that’s a good place to start. We’ve been able to demonstrate that and that’s obviously despite a record profit year,” he told reporters.
The bank maintains guidance for net interest income for 2024 at around last year’s levels after posting a 2 per cent rise in fourth-quarter net profit, beating expectations.
“While interest rates are expected to soften and geopolitical tensions persist, our franchise strengths will put us in good stead to sustain our performance in the coming year,” Gupta said in a statement.
Besides maintaining net interest income at around 2023 levels, he expected return on equity (ROE) to be 15 per cent to 17 per cent for this year and fee income growth at double-digit, according to slides accompanying his results.
Singapore’s banks, the largest in Southeast Asia, are set to post higher profits for the fourth quarter because of higher interest rates, though growth momentum is poised to slow as central banks pivot toward rate cuts and volatile markets weigh on the wealth business.
DBS, the first Singapore lender to report this earnings season, said October-December net profit grew to 2.39 billion Singaporean dollars (USD1.78 billion) from 2.34 billion Singaporean dollars a year earlier on the back of a 9 per cent increase in total income.
DBS, which is also Southeast Asia’s biggest bank, proposed a final dividend of 54 cents per share and 1-for-10 bonus issue.
Full-year annual profit jumped 26 per cent to Singaporean dollars 10.3 billion from Singaporean dollars 8.19 billion in 2022. Return on equity climbed to a record high of 18 per cent from 15 per cent a year ago. PTI GS RUP RUP
About the Author
