Scotiabank CEO gets $10.9-million paycheque

Bank of Nova Scotia’s Brian Porter made more than $10.9 million in 2015.

In his second year as President and CEO, Porter made $9.28 million in direct compensation, 3% above his 2015 goal. That includes a base salary of $1 million, equity incentives worth $6.5 million and a $1.78 million bonus.

Read: CIBC’s Dodig made $8.5 million in 2015

“Under his leadership, the organization made significant progress in advancing our focus priorities: being more focused on our customers; enhancing our leadership depth, diversity and deployment; and better serving our customers while reducing structural costs,” writes Scotia’s board in the bank’s management proxy circular.

Factoring in his pension, which is worth $1.63 million, and miscellaneous other compensation, his total pay and benefits were worth $10.9 million in 2015.

The bank’s performance wasn’t as strong as expected in 2015. That was reflected in Porter’s bonus, which was 25% lower than 2014’s $2.37 million. Still, Porter’s $9.28 million in direct compensation was 3% above his $9-million target for the year, and 5% above his 2014 pay.

Read: TD head was paid $10.7 million last year

The bank’s net income after tax in 2015 was $7.2 billion, down 1.2% from $7.3 billion in 2014. This occurred despite total revenue increasing from $23.60 billion in 2014 to $24.05 billion in 2015. The bank says that adjusting for “notable items” in 2014, net income actually grew 3.2%.

Its personal, commercial and wealth businesses grew, but its wholesale banking activities suffered.

The bank met most of its financial objectives. Its goals were:

• EPS growth. Goal: 4.3%. Actual: 4.8%.
• Return on equity – one year. Goal: 14.8%. Actual: 14.6%.
• Return on equity – three-year average. Goal: 15.4%. Actual: 15.7%.
• Operating leverage. Goal: -0.2%. Actual: -0.7%.
• Customer loyalty. Goal: 51.2 to 52.2. Actual: 51.9.

Wealth Management

Wealth management is part of Scotiabank’s Canadian Banking division. Adjusted net income for Canadian Banking grew by 10% in 2015. Though these results were driven mainly by credit cards, mortgages and credit lines, Scotia’s wealth management brands also had a notable year. The bank launched its “Scotia Wealth Management” brand and expanded wealth advisor teams across Canada.

Last year, James O’Sullivan was appointed Group Head, Canadian Banking. He’s been at Scotiabank since 1990, and was most recently Executive Vice President, Global Wealth Management.

His new job has entitled him to double his old salary. In 2014, he earned $1.45 million in total direct compensation. In 2015, he earned $2.87 million.

That includes a $500,000 salary, a $770,000 bonus and $1.6 million in equity incentives. Including his annual pension value of $366,000 and miscellaneous compensation, his total compensation was $3.16 million.

Gender diversity on the board

Scotiabank is a signatory of the Catalyst accord, and is committed to having at least 25% of its board made up of female directors. Five the 17 nominated directors that will be voted on at the bank’s 2016 annual general meeting are women. If they’re all elected, 29.4% of the board would be female. (Other banks have committed to a 30% target, and are already exceeding it.)