BMO CEO Downe makes more than $10 million in 2015

BMO head William Downe marked his 32^nd year at the bank, and ninth year as CEO, by bringing home $10.2 million in total compensation in 2015.

The bank’s proxy circular shows his direct compensation of $10,155,000 included a $1.9 million salary, a $1.4 million bonus, and almost $7 million in equity and stock options. An additional $16,625 in miscellaneous benefits rounded out his total compensation. He has no pension contributions for the year.

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In 2012, after 29 years of service, Downe’s pension hit a lifetime cap. When he retires, he’ll be entitled to a US$10-million annual pension (currently worth CA$1.3 million).

Downe’s salary is actually paid in U.S. dollars, reflecting his history with the bank’s American operations. Last year, as the Canadian dollar’s value has declined compared to the greenback, the bank reduced his target cash compensation to 96.7% of his total direct pay. As a result, Downe’s combined salary and bonus for 2015 was about $100,000 less than 2014. At the same time, he received about $300,000 more in equity.

BMO’s directors say they’re pleased with the bank’s results in 2015, and note that under Downe, the bank surpassed its record 2014 earnings. Its adjusted earnings per share was $7, up 6% from 2014. The bank adjusted net income was $4.68 billion in 2015, up 5% from 2014.

Read: TD head was paid $10.7 million last year

The board noted that the bank delivered record results in Canadian P&C Banking, U.S. P&C Banking and Wealth management. However, some aspects of the bank’s performance were slightly below its goals, so in total, Downe received just 96.7% of his target compensation, set at $10.5 million.

The goals that affected executive compensation were adjusted earnings per share growth, adjusted return on capital and the adjusted efficiency ratio (net of insurance claims, commissions and changes in policy benefit liabilities). Those numbers were expected to come in at 7.5%, 14.1% and 62.7%, respectively. The actual results were 6.2%, 13.3% and 65.2%.

Women in senior leadership

BMO’s proxy circular also outlined the bank’s plans to increase gender diversity at its top ranks. In 2015, 38% of its top officials were women, but women held only two of its 14 executive officer positions. The bank plans to increase the proportion of women in senior leadership positions to 40%.

Read: Why banks need to hire more millennials

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.