UBS said today it would not pay a bonus to its chairman and board of directors for 2008 after the bank was bailed out by the Swiss government amid billions of dollars in losses from the sub-prime crisis.
'The chairman of the board and the members of the group executive board will not receive any variable compensation for 2008', the Swiss bank said in a statement.
UBS said other employees could still get a bonus but how much and in which form will be decided once the bank's full year results are known and after consultations with the Swiss Federal Banking Commission.
'UBS's new compensation model will be focused on the long-term and more closely aligned with the value creation of the firm,' the bank said.
The Swiss government insisted that UBS reform its pay structure as part of its 60 billion franc bail-out package last month to buy up its toxic debt.
Finance Minister Hans-Rudolf Merz earlier this month called on 'the top staff at UBS to reimburse spontaneously their undeserved bonuses.'
The bank's former head Peter Wuffli said last weekend he was giving up 12 million Swiss francs (€8m) to which he was contractally entitled as a gesture of solidarity to the bank's staff.'
Marcel Ospel, the former chairman of the UBS board of directors, whose earnings were described as pharaonic by the current Swiss president, has yet to say whether he will hand back part of his pre-2007 bonuses. Last year he did not take extra payments, with the result that his earnings fell by 90%.
