World's largest lender Citigroup has awarded its newly-appointed CEO Vikram Pandit stocks worth USD 30 million, even as the India-born executive has decided to forgo a cash bonus at the crisis-ridden bank.
The 1.1 million share units and options for additional three million shares being awarded to Pandit is estimated to be worth about 30 million dollars (Rs 120 crore) -- an amount close to six times of total compensation paid by all the Indian banks together to their top executives last fiscal.
Nagpur-born Pandit was conferred by the Indian government Padma Bhushan, a prestigious civilian award, on Saturday.
The stock and options award was disclosed by Citigroup in a regulatory filing in New York late last week. This is higher than the total bonus worth 23.9 million dollars given to previous CEO Charles Prince last year. Prince got 10.7 million dollars in stock and 13.2 million dollars in cash bonus.
The salary of Pandit, who took charge of Citigroup in December 2007 after Prince resigned amid mounting subprime crisis-related losses, is not known as yet. However, Prince got an annual pay package of about 26 million dollars (about Rs 100 crore).
In comparison, more than 500 top executives and board members at India's public and private sector banks together received an annual compensation of about Rs 20 crore last fiscal. ICICI Bank's Managing Director and CEO KV Kamath, the top paid banker in India, took home about Rs 2.61 crore.
Just about 10 top bankers in India got their salary in crores last fiscal, according to data disclosed in their annual reports.
The stock bonanza for Pandit comes within weeks of Citigroup announcing close to 4,200 job cuts across the world. According to reports, the bank has finalised close to 400 lay-offs in the UK, while the remaining 3,800 jobs would be eliminated in the US and Asia, including India.
After announcing Citigroup's fourth quarter results last month that showed a loss of 9.8 billion dollars primarily due to over 19 billion dollars of write-downs and credit costs related to the subprime crisis, Pandit had said the performance was "clearly unacceptable". It was the largest quarterly loss in the bank's history of about two centuries.
After the results, the bank had decided to cut down the cash bonus for senior management members by half. However, Pandit decided to entirely forgo his cash bonus.
The stock reward for Pandit comes just about six weeks after he assumed the office as the CEO of Citigroup.
Besides Pandit, a number of other board members and senior managers have also been awarded stock and options. The bank's Chief Financial Officer Gary Crittenden has been given 377,579 shares worth about 9.2 million dollars, while newly- appointed Chairman Win Bischoff would get shares worth about 4.4 million dollars.
However, the bank's executive committee Chairman Robert Rubin has decided to forgo the stock bonus.