BMO Makes Layoffs in North American Capital Markets at a Time of Raises For Top Officials
While unveiling plans to lay off 60 North American capital markets executives, Bank of Montreal has also announced that several of its top officials—including its capital markets chief—took home raises last year.
Tom Milroy, BMO’s head of capital markets, made $7.99 million, up 14 percent. The company’s proxy circular explains that Milroy’s compensation reflects the CEO’s assessment of his performance against “key financial and individual performance objectives” and explains that among other things, Milroy upgraded the bank’s talent in North American and global sectors, strengthened distribution capabilities by building out its U.S. distribution platform, strengthened fixed income capabilities and extended BMO’s Metals and Mining capabilities beyond North America.
The bonus portion of Milroy’s compensation declined by some $800,000 based on his failure to meet two of four of his targets for the capital markets division.
Interestingly enough, the raises at BMO were made public on the same day the bank laid off about 60 people in its North American capital markets division, the Globe and Mail reports, adding that the cuts are believed to represent a little more than 2.5 percent of the 2,300 people employed in the capital markets unit.
“The reductions are part of our focus on productivity and we would expect to continue to be hiring over the course of the year as we grow our businesses,” the bank said in a statement.
BMO’s proxy statement shows the bank did do well in terms of total shareholder return, and several of the bank’s top officials saw earnings increases.
BMO CEO Bill Downe saw his total compensation increase 12 percent to $11.4 million, for instance.
Regulatory filings show Downe’s compensation included a base salary of $1.03 million, and another $10.4 million in stock bonuses, options and other incentives. Downe earned $7.56 million in 2009 and has seen his total compensation jump a substantial 51 percent in the past two years, says the Globe and Mail.
According to the bank, the latest raise for its CEO came after BMO embarked on a major expansion in the U.S. with the purchase of Milwaukee-based Marshall & Ilsley Corp.
Chief financial officer Tom Flynn received a total compensation of $3.45 million, up 4 percent.
BMO is the third major Canadian bank to report executive compensation for 2011. The first two—Royal Bank of Canada and Toronto-Dominion Bank—announced that executive compensation is going down, for the most part. For instance, TD Bank President and Chief Executive Ed Clark will receive no raise for his 2011 service, though he was still Canada’s highest-paid bank executive in 2011.
Other top executives at BMO—Canada’s fourth-largest bank in terms of assets—to receive compensation increases last year, were:
- Gilles Ouellette, head of the bank’s private client group, who had total compensation of $4.35 million, a raise of 15 percent.
- Frank Techar, head of Canadian retail banking, who made $4.49 million, a 7 percent increase over 2010.
- Executive vice president of business integration Russel Robertson who made $2.66 million, an increase of 5 percent.