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NAB Chief Clyne Receives Whopper Pay Package
Cameron Clyne, chief executive of Australian banking major NAB who controversially passed on just 20 basis points of the 25 basis point cut enacted by the Australian central bank, despite the fact that the lender posted a 19.2 per cent increase in full year net profits on $5.5 billion is in line for a large pay hike.
The lender released its annual report recently which shows the NAB chief received a pay hike of 12 per cent, meaning Mr. Clyne received $8.67 million in compensation during the last financial year.
Mr. Clyne’s total compensation was increased by over $950,000 compared to the previous year, which comprises a base salary worth $2.7 million, and stock worth $3.8 million, and short term cash bonuses worth $2 million.
Mr. Clyne’s contemporaries at ANZ and Westpac have both had their cash bonus components of their compensation packages cut. ANZ chief Mike Smith saw his cash bonus cut by as much as $750,000, whilst Westpac chief Gail Kelly had her short term cash bonus component cut by $460,000. In contrast Mr. Clyne saw his cash bonus component rise by $108,000.
”Executive remuneration at NAB is directly linked to the performance of the company and includes the achievement of customer, employee and shareholder objectives.” An NAB spokesperson said.
NAB’s cash earnings rose by 19 per cent to $5.46 billion for the full year ending September 30th. The lenders Return on Equity also rose by 2 per cent to 15.2 per cent.
Despite his pay hike, Mr. Clyne’s compensation package is the third largest amongst the big four lenders. Ms. Kelly’s package is worth $9.86 million, CBA chief Ralph Norris received $8.64 million during his last year in the role, whilst Mike Smith received over $10 million.
CBA To Launch Credit Card Payment App
Credit cards may soon go the way of the dinosaur as increasingly mobile smart phones usurp plastic for instant payments.
The most recent innovation that is helping credit cards on their way to extinction is Australian banking major CBA introducing a new application is calls tap and pay, which allows smart phones to connect to payment devices such as cash registers, and also allows for facebook and email payments.
CBA has named the app Kaching, and it works by taking the information that is coded into into the magnetic strip of a credit card, and storing and transmitting it by phone instead.
The app makes use of Near Field Communication (NFC) technology, and has already been introduced in America, where its use already encompasses the replacement of keys, passports, receipts and business cards.
Users of the application need not be customers of CBA in order to be able to receive payments made using Facebook or by email, and are instead taken to an external collection site.
A CBA spokesperson said the lender would like the app to be able to penetrate across all payment gateways in Australia from businesses to individuals.
“Mobile and online social payment is the next step in transaction technology and now Australian consumers will no longer have to rely on cash or cards to make payments to family, friends or businesses, the spokesman said.
He added that Kaching would also enable businesses to reduce their reliance on cash.
The application was designed in close collaboration with Apple, with security of the system being the key ingredient in its development.
The app will make use to password encryption technology, so that if a user loses or has their phone stolen, their personal data including banking information could not be compromised, since it is not stored locally on the phone.
He said the app would also help businesses reduce the need for cash.
Receivers of payments would also be protected with any funds that had not been credited, restored after 14 days.
Kaching will be available before Christmas to Apple iPhone users with iOS4 and above.
ANZ Freezes Salaries For Some Senior Executives
Australian banking major ANZ, currently the worst performing banking stock’s amongst the major lenders says it intends to cut back on pay rises for at least 900 of its most senior most executives to no more than one per cent amid a decline in lending.
The pay rise cap implies that group one and two executives will have their salaries frozen for at least the next year according to a letter written to staff of the bank by chief executive Mike Smith dated September 19th.
“I realize that for some this is a difficult message, but as leaders of our business, it is the right thing for us to do in the current climate,” Smith said
Melbourne based ANZ is currently operating against a backdrop of slower earnings growth which is the result of some of the highest borrowing costs in the developed world, as falling property valuations has caused a drop in demand for home loans, which have reached their lowest level in three decades.
Rivals CBA, Australia’s largest lender is also seeking to cut is cost to income ratio, whilst Westpac says it is introducing “ productivity initiatives” in its effort to cut its costs.
Mr. Smith in his letter said that the salary freeze was primarily aimed at those in the lower salary range and “performing well”
“The environment for banks globally is becoming more difficult and we believe showing leadership from the top by demonstrating restraint on costs is the right thing to do for the business and for our shareholders,” an ANZ spokesman said in an email statement.
In August ANZ shares declined the most in over a year, after the lender announced that income from trading fell during the quarter ending June 30th. ANZ will announce full year fiscal earnings for the year ending September 30th on November 3rd.
CBA in contrast has embarked on cost cutting which does not include the cutting of jobs, which is being dubbed “Project 35” according to a spokesperson for the lender.
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