ZKB even outperforms UBS when it comes to bonuses

class=”sc-3778e872-0 gWjAEa”>

The Zürcher Kantonalbank has been giving very solid figures for years. Its finance, wealth management, trading and payment processing businesses generated profits of over CHF one billion last year. It was 942 million CHF in the previous year.

This also benefits the employees. According to “Tagesanzeiger”, the bank paid an average of CHF 60,000 to its 5,000 employees in 2021.

This makes a total of 295 million Swiss francs. Compared to 2014, bonus payments increased by 148%. During this period, the number of employees in the bank increased only slightly. And profits rose almost 64 percent over the same period.

On average higher bonuses than UBS

Next week’s annual report will show how high the jackpots will be for 2022. But fees at ZKB are “slightly below” the level of major Swiss banks, as Zurich recruiter Guido Schilling told “Tagesanzeiger”.

For comparison: UBS employees worldwide will receive bonuses in excess of three billion francs for 2022. With 72,000 employees, this averages 41,600 francs. But the bonus says nothing about base salaries. And while ZKB employees receive Swiss salaries, UBS employs workers in countries with lower wages. Bonuses for 2022 at Credit Suisse will average CHF 20,000 per employee. But unlike the strong results of UBS and ZKB, the bank made a billion loss in 2022.

Another question arises at ZKB: Are high wages and bonuses justified in a state bank? Increased bonuses are also an issue at the Zurich cantonal council. You have to pay competitive wages to get the necessary management and skilled workers, the bank defends their wages when asked by “Tagesanzeiger”.

False risk incentives

Guido Schilling does not want to criticize the fees at ZKB. But he finds wage patterns in the banking industry fundamentally worrisome. “Variable fees at banks are too high and should be lowered,” he tells “Tagesanzeiger”. Among other things, because it is difficult to divide the company’s success into individual employees and then pay them fair, individual bonuses.

However, variable fee components in banks are also subject to criticism in terms of risk culture. Especially when bankers are rewarded with super bonuses for high profits – but also when they get huge jackpots with a bad outcome. This makes employees tend to take too many risks. But at ZKB, bonus payments are linked to business success. If the bank didn’t make a profit in a year, the bonuses would drop to zero. (smt)

Source :Blick