HSBC CEO also had a Swiss account; pay frozen after cut in 2014

LONDON: At the centre of a controversy over himself having a Swiss bank account, UK-based banking major HSBC's CEO Stuart Gulliver will not get any salary hike this year, after he took a pay cut last year to USD 12.5 million.

In its annual report published today, the bank disclosed that Gulliver's total pay package stood at 7.62 million British pounds (USD 12.5 million) in 2014, down from 8.03 million British pound in the previous year.

Explaining its "remuneration policy going forward", HSBC further said that the base salary levels, fixed pay allowances and pension allowances as a percentage of base salary would remain unchanged from the 2014 levels for Gulliver, as also for some other top executives during 2015.

The variable pay components -- annual incentive and Group Performance Share Plan (GPSP) -- and other benefits would also remain unchanged from the 2014 levels.

As a result, Gulliver will get a base salary of 1.25 million British pound, a fixed pay allowance of 1.7 million British pound, pension allowance at 50 per cent of base salary, along with other benefits and variable annual incentives during 2015.

The salary disclosures followed local media reports here that claimed Gulliver himself had kept millions of dollars in a Swiss bank account.

Taking forward the disclosures from the so-called ' SwissLeaks' series about offshore clients of HSBC's Swiss banking unit, the Guardian newspaper reported that Gulliver was himself a client of HSBC's Swiss banking arm that is being probed for allegedly helping wealthy clients from across the world evade taxes.

Gulliver had about USD 7.6 million in a Swiss account in 2007 in the name of a Panama-registered company, the report said. Reacting to this, the bank said that Gulliver used that Swiss bank account to hold his bonuses.

The account was opened in 1998 when Gulliver was living and working in Hong Kong and all required taxes were paid in Hong Kong on those bonus payments, the bank said. He moved from Hong Kong to London in 2003.

Media reports also quoted Gulliver as saying that he had never paid taxes below the highest rate of tax in the UK on all his earnings since becoming HSBC CEO.

"I am a UK tax resident, Hong Kong domiciled. I have paid full UK tax on the entirety of my worldwide earnings. It's not surprising as a 35-year HSBC veteran that I should be a Hong Kong domiciled. I would expect to die abroad which is a test of domicility," he said.