An exceptional package for Nouvobanq's MD

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An exceptional package for Nouvobanq's MD

Post  Sirop14 on Thu May 04, 2017 6:34 am

Today in Seychelles added 2 new photos.
13 mins · Victoria, Seychelles ·
Wednesday 26 April 2017
State owned enterprise
An exceptional package for Nouvobanq's MD
Dr. Steve Fanny, Chairman: "One must put things into context"
CEO and Managing Director, Ahmad Saeed is entitled to 2% of the dividends paid by Nouvobanq each year to its
shareholders. Together with his emoluments, this amounted to more than SCR 4,5 million in 2015. The Chairman of the
bank, Dr. Steve Fanny, explains that "such contract offers an incentive to motivate performance at the highest level."
by R. Meetarbhan
Going through the Financial statement of Nouvobanq for the year ended December 31, 2015, we learn in paragraph 25, under the title Director's emoluments, that the CEO and Managing Director, Ahmad Saeed, earned more than SCR2 million as emoluments. To be more precise, his emoluments for that year amounted to SCR2, 392, 000. From that figure, we can work out the average monthly income of the boss of the bank. It comes to approximately SCR200,000.
These are things we should know because the State is the majority owner of Nouvobanq. Founded in 1991, when it took over the BCCI (Bank of Credit and Commerce International), the bank is a joint venture between the Government of Seychelles (78%) and Standard Chartered Bank(22%).
Asked to comment on these figures, Dr. Steve Fanny, Chairman of Nouvobanq said that "The figures are correct. However one must put things into context and compare it with the salary and bonuses of CEOs of other banks in Seychelles because you cannot say his salary is high based on what people are saying on social media , it must be substantiated properly."
In addition to the astounding fact related to the emoluments, there is an anomaly which was detected several years ago but never corrected. Managing Director Saeed is entitled to 2% of dividends declared each year by the bank.
The Chairman, Dr. Steve Fanny, has confirmed "that the CEO received 2 percent as dividend based on the contract signed in
1990 where Mr. Saeed was asked to leave the previous bank at the time and set up Nouvobanq. I could only assume that the premise behind the deal back then with him was not abnormal and further in the banking and financial service sector such contracts offers an incentive to motivate performance at the highest level. In the worldwide banking industry senior management(CEOs, Directors, General Managers, etc) of banks
are offered shares in banks, bonus related performance and a host of other perks over and above their salaries."
In 2015, the bank declared and paid dividends to the tune of
SCR110 million. It follows then that if the CEO & MD claimed his
2%, he received SCR 2,2 million over and above his emoluments. This sum is paid by government out of the Consolidated Fund and not from the bank's funds, sources say.
We are informed that when Ahmed Afif was Principal Secretary at the Ministry of Finance and Chairman of Nouvobanq, he had raised the question of the unusual payment made to Mr. Saeed. The Board then explained to him that this payment was not included in his contract with the bank but is a result of a verbal arrangement made between the authorities and the banker. Ahmed Afif wanted to discontinue this practice outrightly but received instructions from the higher authorities not to do so. For his part, the Chairman insists that "the payment is based on a signed contract."
In reply to a question from TODAY about the reason that pushed him to object to these payments, Ahmed Afif explained that if the same logic were applied to other government companies then every CEO and MD, in every company from SACOS to SEYPEC, should be enjoying the same privilege and cashing a percentage of the dividends they distribute to shareholders.
Dr Steve Fanny said that he did not wish to comment on "other
CEOs' merit", but added that "we should be very careful here. Mr. Saeed as a CEO has performed well and Nouvobanq is a very successful bank. One should not focus on his salary in isolation. If the bank was losing money, then it is normal that these sort of questions be raised but to myopically focus on his salary is prejudicial when we fail to put everything into context. The bank is today the biggest provider of dividends to government and draws its profits on activities which are of an international dimension.
TODAY will publish a series of articles on the salary packages offered to CEOs in other State Owned enterprises in a near future. Often these packages are topped up with perks such as housing, car and travel allowances.
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Sirop14

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