Backlash at CYBG AGM
Shareholders revolt over Clydesdale bonus plan for Duffy
David Duffy: bonuses would more than double his total remuneration package
Executive pay at Clydesdale and Yorkshire banks came under fire at parent company CYBG’s AGM where more than a third of shareholders (34.2%) voted against a plan to double the chief executive’s payout. A further 7.4 million shareholder votes were withheld.
The group – which recently acquired Virgin Money for £1.7 billion – said it “recognises the large number of votes opposing the resolution” and has pledged further talks with investors.
The rebellion at its AGM in Melbourne, Australia, followed plans to boost payouts and bonuses for chief executive David Duffy and chief financial officer Ian Smith.
The plan would mean Mr Duffy’s potential bonuses would rise to 118% of his salary, while his long-term share payout would rise to 177% – meaning his total maximum payout could jump from £1.8 million to a possible £4.2m if all targets are met.
Mr Smith could see his total pay package surge from £914,000 to £2.1m.
CYBG recently revealed a full-year loss of £164m after it was forced to take an extra £150m charge linked to the mis-selling of payment protection insurance.
On the shareholder vote, CYBG said: “In addition to the extensive consultation of shareholders undertaken prior to the publication of the directors’ remuneration report, the company will further engage with shareholders on the implementation of its remuneration policy over the coming months to ensure shareholder views are fully understood and considered.
“These views will also inform the company’s remuneration policy which will be subject to shareholder approval at the company’s 2020 annual general meeting.”
Shareholder advisory group ISS, recommending rejection of the pay proposal, pointing out that CYBG’s shares have dropped sharply since the takeover with Virgin Money was approved. CYBG defended the proposals as the Virgin deal had boosted the size and complexity of the group.
The AGM also saw 6% of investors vote against re-electing both Mr Duffy and Mr Smith.