Outline of the remuneration structure for Directors and managers

  FIXED COMPENSATION VARIABLE COMPENSATION
EMPLOYEE CATEGORY BASE (Upfront) PENSION PLAN CONTRIBUTION SHORT TERM INCENTIVE (Annual scorecard) LONG TERM INCENTIVE (Strategic Plan 19 -23)
      5Y deferral - 60% deferred* 5Y deferral - 60% deferred*
  CASH CASH CASH SHARES CASH SHARES
Executive Directors 100% 100% 47% 53% 47% 53%
Non Executive Directors 100%          
Chairman 100% 100%        
Executives Senior Management 100% 100%  47% 53% 47% 53%
      3 Y Deferral - 40/60% deferred*    
Other Executives  (Material Risk Takers) 100% 100% 50% 50%    

* If variable amount equal or higher of € 425.000 

Compensation paid to the members of the management and control bodies, general managers and other key managers

Chairman’s remuneration

The Chairman of the Board receives fixed remuneration only.

Remuneration of non-executive directors

The general meeting establishes fixed fees for the non-executive Directors without any incentives linked to the bank’s performance. They also receive third-party liability insurance coverage.

GROUP # ANNUAL COMPENSATION PAID PER DIRECTOR COMPENSATION PAID TO BOARD COMMITTEE CHAIRPERSONS TOTAL
DIRECTORS 15 100,000   1,500,000
DEPUTY CHAIRMAN 2 35,000   70,000
EXECUTIVE COMMITTEE 2 90,000   180,000
REMUNERATION COMMITTEE 4 30,000 40,000 130,000
APPOINTMENTS COMMITTEE 4 20,000 25,000 85,000
CONTROL AND RISKS COMMITTEE 5 80,000 100,000 420,000
TOTALE       2,385,000

 

Remuneration of Mediobanca’s CEO and General Manager

Mediobanca’s CEO and General Manager receive:

  • a base salary;
  • an annual short-term incentive subject to the gateways established in the policies and linked to the achievement of the quantitative/financial performance and qualitative/non-financial performance indicators in individual scorecards which the Board of Directors approves each year upon the proposal of the Remuneration Committee.
    • Each manager’s scorecard sets performance targets within their respective scope of responsibility. For instance, the targets may refer to risk-adjusted profitability; group revenue or the revenue of certain divisions; the profitability or income generated by the individual areas for which they are responsible. Alternatively, they may coincide with other capitalization, liquidity or new business initiative objectives in line with the guidelines in the strategic plan. These performance targets are weighted according to their materiality determined by the Board and considering the effective degree of decisional autonomy.
    • For the year ended 30 June 2020, to begin transitioning to the long-term incentive plan (see below), the annual performance-based pay for the achievement of quantitative/financial objectives is capped at 150% of the annual base salary, although the Board has the power to adjust the cap upward to 160% in order to reward the achievement of non-financial objectives.
    • 60% of performance-based pay is deferred over five years, with 45% paid in cash and 55% in equity. All deferred pay is subject to the performance targets and malus conditions established in the policies. Half of the up-front component is paid in cash and the other half is paid in Mediobanca shares.
  • When it approves the multiannual strategic plan, the Board of Directors may also approve a long-term incentive plan for the CEO and General Manager linked to the achievement of the objectives in the strategic plan.

    Based on their individual scorecards, the pay-out for the achievement of quantitative/financial and qualitative/non-financial targets ranges from 20% to 40% of the CEO’s and General Manager’s gross annual base salary for each year of the plan. The final amount at the end of the plan, based on overall performance, is calculated considering each of the targets in the scorecard and their relative weight.

    At the end of 2019, the Board of Directors approved the long-term incentive plan linked to the 2019-2023 strategic plan. Learn more
  • The CEO and General Manager receive directors’ fees but not for serving on the Board Committees. They also receive third-party liability insurance coverage like the other directors, participate in the supplementary pension fund and are eligible for the Mediobanca group’s other management benefits.
  • Until the end of the vesting/holding periods, the CEO is required to hold, even after any stock grants as performance-based pay are effectively vested, a number of Mediobanca shares worth twice the amount of base salary and the General Manager is required to hold shares worth one time such amount (i.e.,  the stock ownership requirement). The equivalent amount of shares – to be reached within five years of the first stock grant – must be held for the entire term of office in order to align senior managers’ interests with those of the shareholders.

CEO - FY 20 STI scorecards

PARAMETER WEIGHT
Gross ROAC adj. Banking activities 35%
RWA density 25%
Total fee revenues 20%
% of AUM/AUA/AUC on TFA 20%
CSR development initiatives qualitative
WM, Consumer, CIB distribution platform enhancement qualitative

 

General Manager - FY 20 STI scorecards

PARAMETER WEIGHT
Gross ROAC adj. Banking activities 35%
RWA density 20%
Banking Activities cost/income ratio 20%
Wealth Management ROAC 25%
IT projects (Data Quality & IT Growth to the business) qualitative
WM sinergies (proprietary factories with distribution) qualitative

 

As required by article 78 of Consob resolution 11971 of 14 May 1999, as amended, section 2 of the 2019 remuneration policy lists, for 2018/2019 and naming each recipient, the amounts paid, the stock grants and other equity-based incentive plans benefiting the members of the management and control bodies, the general managers and, at aggregate level, other key managers. Anyone who, in the course of the year, held the aforesaid offices, even for a fraction of the year, is included. Furthermore, additional aggregate quantitative information has been published pursuant to the Bank of Italy’s supervisory requirements.

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