Washington, Sep 25 (Calcutta Tube) Citigroup’s India-born CEO Vikram Pandit has decided to work for just $1 for the second year in a row.
Pandit, who has restored the ailing banking giant to profitability and brought it mostly out from under strict government scrutiny after a $45 billion rescue during the financial crisis, told the Citi board he wouldn’t accept any compensation above $1 for this year, the group said Friday.
Citi also announced it would be paying its top 25 executives by way of ‘stock salary,’ or non-cash compensation.
Pandit’s salary will bounce back next year, however, regardless of what he wants. In a statement, Citigroup Chairman Richard Parsons said Pandit had restored the company to profitability and is well along in his efforts to shed assets and refocus the firm on a narrower set of priorities.
‘Vikram’s decision is admirable but, beginning in 2011, the board intends to compensate Vikram commensurate with the job of CEO of Citi.’
Under the government’s Troubled Asset Relief programme, Citi received one of the biggest lines of assistance in 2008 and 2009. It is now close to completely ending that association with the Treasury planning to sell its last remaining holdings of Citi by the end of the year.
Citi says granting ‘stock salary’ now allows it to decide on bonuses for 2010 at the end of the year. If Citi ends up paying for all 12 months of the year, that would add up to ‘stock salaries’ for those executives ranging from $9 million to $4 million.
US business magazine Forbes said this is consistent with projections earlier this year by Wall Street compensation consultant Alan Johnson, who said the good news is pay is coming back to Wall Street after many senior executives did without last year.
(Arun Kumar can be contacted at firstname.lastname@example.org)