March 12, 2012 at 1:16 PM ET
Citigroup may be dealing with a slump in revenue and planning to lay off thousands of workers, but it’s still finding the funds to give its CEO Vikram Pandit a pay package for 2011 worth $14.9 million.
A regulatory filing from last week shows Pandit received $1.7 million in salary for 2011, stock option awards valued at $7.8 million and a $5.3 million cash bonus -- his first since the financial crisis. These awards, coupled with another $14,700 in “other compensation,” brought his total 2011 payout to almost $14.9 million, the filing said.
“The [compensation] committee awarded annual incentive compensation, in addition to salary, to Mr. Pandit for the first time in four years in a manner commensurate with his responsibilities and the success of his implementation of Citi’s long term strategies,” the SEC filing said, adding that Pandit “has led Citi’s return to profitability and has positioned the company for future growth.”
Pandit’s 2011 payout, and a multi-year retention package that could total $53 million, were announced in May, according to an analyst’s estimate and regulatory filings examined by Bloomberg News. Pandit also received $79.7 million in 2011 from Citigroup’s purchase of the hedge fund Old Lane Partners that he co-founded in 2006, Bloomberg said.
“The awards have been very generous,” Frank Glassner, CEO of Veritas Executive Compensation Consultants in San Francisco, told Bloomberg in an interview. “It’s obvious Mr. Pandit has been working very, very hard, but they don’t seem to be in line with total shareholder return.”
Pandit received a salary of $1 and no bonus for 2010 after saying he would only take a token salary following the bank’s receipt of $25 billion in federal TARP funds after the bank came to the brink of collapse during the financial crisis. The bank has since repaid those funds.
News of Pandit’s payout comes just two months after the third largest bank based in the United States reported fourth-quarter revenues of $17.2 billion, down 7 percent from the prior year period. The bank’s share price is down 26 percent over the past year amid a selloff in the shares of financial companies.
And in early December Citigroup said it will cut about 4,500 jobs in future quarters as the company seeks to cut costs as revenue slumps amid “unprecedented” market conditions.
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