DBS CEO Piyush Gupta Has S$4.14 Million Cut In Variable Compensation
DBS Bank announced today that CEO Piyush Gupta will take a 30% cut in variable compensation to hold him “accountable” for the series of digital disruptions in 2023.
The pay cut amounts to S$4.14 million.
Meanwhile, the bank’s group management committee will take a collective reduction of 21% for their 2023 variable compensation.
The bank recorded profits before allowances of S$2.80 billion for Q4 2023 — 11% below the previous quarter and 7% higher than in 2022.
DBS CEO Piyush Gupta takes 30% cut in compensation
According to a statement released on Wednesday (7 Feb), the DBS board decided that its Group Management Committee should receive a cut in variable compensation to hold them accountable for the series of digital disruptions last year.
This cut amounts to 21% collectively “despite record 2023 profits”, though the exact reduction in monetary value wasn’t stated.
Mr Gupta took a larger cut of 30% — meaning he’ll take home S$4.14 million less.
The bank also said it will commit S$80 million to “implementing its technology uplift and resilience roadmap”.
“These efforts will enable the bank to better pre-empt disruptions to its services, provide customers with alternate channels for payments and account enquiries during disruptions, and shorten incident recovery time,” DBS said.
Going forward, the bank will continue with its investments to sustain efforts to provide reliable services to customers.
Record profits in 2023
DBS recorded a 26% net profit in 2023, amounting to a record S$10.3 billion in profit.
Source: Bloomberg
Total income also rose by 22%, going beyond S$20 billion for the first time. A higher net interest margin, rebound in fee income, and record treasury customer sales contributed to this.
Net profit grew in Q4 2023 to S$2.39 billion too, and profit before allowances was S$2.80 billion.
The bank noted, however, that net profit fell by 9% due to “lower net interest margin” as well as seasonally lower non-interest income.
“Total allowances of SGD 142 million were higher than a year ago when there had been a general allowance write-back,” DBS added.
Mr Gupta said DBS had achieved “an outstanding financial performance in 2023”, with a return on equity of 18.0%. This was more significant than in earlier years.
He noted that digital and franchise transformations “reaped substantial benefits” amidst higher interest rates.
This helped to give more capital returns to shareholders through a bonus issue and make a S$100 million contribution towards a 10-year community support initiative, he said.
“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.”
DBS sets aside S$100 million in profits to support vulnerable communities
Concurrently, DBS said junior employees — half of the bank’s total headcount — will receive a one-time bonus to help with the rising cost of living.
It has set aside a total of S$15 million from 2023 profits.
As noted by Mr Gupta, DBS will also commit S$100 million — taken from 2023 profits — to support vulnerable communities.
It’s part of the bank’s efforts to improve the lives of those who are underprivileged as it commits S$1 billion over the next 10 years to the cause.
In December 2023, DBS partnered with the Ministry of Social and Family Development (MSF) to help families with children staying in rental flats.
The S$30 million partnership will last three years.
Initiatives under the partnership will include help for families to prioritise children’s preschool education.
A befriending programme consisting of bank employee volunteers will also work with 200 families in Ang Mo Kio, Yishun, Boon Lay, and Taman Jurong.
“The volunteer befrienders will engage the families closely through monthly visits and various outings, and look to build meaningful connections with them,” DBS elaborated.
Additionally, the volunteers will help with emotional support and keep families on course to meet their goals.
Also read: DBS S’pore Record S$2.63 Billion Net Profits For Q3, Apologise For Recent Disruptions
DBS S’pore Record S$2.63 Billion Net Profits For Q3, Apologise For Recent Disruptions
Have news you must share? Get in touch with us via email at news@mustsharenews.com.
Featured image adapted from Bloomberg and White Page International.
Drop us your email so you won't miss the latest news.
