How much Maria Ramos got paid on leaving Absa

And what new CEO Daniel Mminele will earn …
The short answer is millions. Many millions. Image: Moneyweb

Maria Ramos, who retired as Absa Group CEO at the end of February 2019 “on reaching her contractual retirement age of 60 years”, was paid R3.8 million for her two months’ work at the banking group.

This was comprised of R1.6 million for her salary (plus smaller contributions in respect of medical aid and retirement benefits) and R2.1 million in “other employee benefits”. This latter figure is elevated due to leave pay that was owing to her.

However, the group says “consistent with [its] policy on retirement, Maria was granted eligible leaver status on her unvested restricted shares, deferred short-term incentive and long-term incentive awards. All awards subject to eligible leaver treatment remain in the respective plans until the originally scheduled vesting dates”.

As at the end of February 2019, Ramos had 316 222 shares under award/option for 12 different share-based and long-term incentive plans. Together, these were worth R47.2 million as at end-December. The plans stretch back to 2016 and include six interim periods of “role-based pay”, where a portion of salary was paid in shares to ensure market competitiveness under the previous policy implemented by Barclays.

On top of this, Ramos had an additional R7.5 million in cash-based awards outstanding as at end-February.

This means that on leaving the bank, Ramos had awards outstanding totalling R54.7 million. But, given that there is no disclosure beyond her retirement at the end of February, some of these shares may have vested during 2019.

While performance conditions related to the 2017 long-term incentive award ran to the end of 2019, the separation from Barclays will only be substantially complete by June. This means final vesting will only happen in July.

Aside from Ramos, the five executive directors and prescribed officers of the group were awarded total remuneration of R116 million in 2019.

Role Total awarded

remuneration in 2019

René van Wyk Interim Group CEO R15 166 667
Peter Matlare Deputy Group CEO, CEO: Absa Regional Operations R18 259 314
Jason Quinn Group FD R29 509 313
Arrie Rautenbach CE: RBB SA R30 259 373
Charles Russon CE: Corporate and Investment Banking R23 509 313

Arrie Rautenbach, who was appointed chief executive of Retail and Business Banking South Africa in April 2018, was awarded almost double the remuneration of interim CEO René van Wyk in 2019. Rautenbach was awarded a short-term incentive of R11 million, slightly below the amount awarded in 2018. His long-term incentive of R12 million will be measured over the 2020-2022 performance period. The remuneration committee says this is “higher than the value indicated in his on-target remuneration potential mix, as the board seeks to incentivise future performance and the creation of shareholder value over the long-term. This is also in line with the principle of, over time, making a greater proportion of the total remuneration mix subject to performance, and in this instance, longer-term performance.

 

Source: Absa 2019 Integrated Report

New CEO Daniel Mminele, who was appointed effective January 15, will receive the following remuneration this year:

  • A cost-to-company package of R9 million
  • A long-term incentive award, to be made this month, of R15 million, subject to “group performance conditions” between now and the end of 2022. “This will vest on the third, fourth and fifth anniversaries of the grant date.”
  • An on-target award of R15 million for this year’s “short-term incentive arrangements”.

Absa notes that there were “no sign-on or buy-out awards applicable as a result of Daniel joining the group”.

Source: Absa 2019 Integrated Report

Long-term incentive measures for the next three financial years (to December 2022) are clear.

Less clear is the obvious impact Covid-19 will have on these. Alex Darko, chair of the group’s remuneration committee (RemCo), notes in the integrated report that: “The RemCo will assess the impact of the Covid-19 pandemic and will, at the appropriate time, consider the performance metrics and vesting conditions of performance-linked share awards.”

In addition, the group’s share price has halved during the first quarter of 2020 making all previously granted share-based incentive awards significantly less attractive.

 

Absa Group share price in the past month

 

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Being a politician pays. One of th Big 4 management teams Absa was consistently rated the poorest and on valuation the lowest price to book ratio due to its weak franchise and growth rates. Being paid exorbitant salaries and benefits along with Peter Marlare (ex Tigers value destroyer)

does not matter how one looks at it: as a political connection to be in that job the answer is simply: “far to much”

look at other entities where she worked and show me any long term positive result left to that entity by her.

The perfect example of why critics of capitalism will always have a case. The gross amounts paid to execs who are already super wealthy by any standards, compared to the pittance paid to regular employees, of whom many have given decades of service, Regular employees, although having to contribute to a pension scheme retire after 20 years of service with around 1/4 of their income at retirement if they are lucky. And wealthy Ramos gets R 3.8 M for 2 months work and still has R 54 M in awards coming to her.. PLease try and explain why the top 5 execs earn R 116 M in 2019, especially when the share price has lost more than 50 % this year.Dont think they will repay anything or be penalised for this. More workers will be retrenched. Just mentioning.

Correct, but this is precisely why Ron Paul made the crucial distinction between Capitalism and Corporatism. They are not the same thing. Corporatism, in which managerial elites are able to indulge themselves in every respect, needs to be discouraged by shareholders. Are they doing this? Beware Big Finance, Big Government, Big Unions…

@Cliff. My wife has worked at absa for 4 years now as a Temp and she never ever been given a Bonus, Leave pay, Sick pay or any benefits applicable. Her senior boss’s however have all received in excess of R200k bonus’s each based on her deliverables – as she is highly skilled in IT, HR and Technology. And now as a R30k/month Temp she is going to be bulleted today as they are not going to renew her contract. My despise for absa is exponential.

My sympathies. It is criminal, but alas, the big corporations and FSP’S rule. While the retirement industry pays policy members less than you can earn by simply putting the money in the bank, the law prohibits you from taking your money out of pensions and R.A’s. So in reality where you can earn 6 to 7 % on your money your financial advisors return negative growth (while still taking their commissions) and the man in the street is losing money hand over fist.

Tell your wife to become entrepreneurial … its time for everyone to do so.

ABSA is a sinking ship … their base is eroding. My contact on the inside tells me things dont look rosy… they retrenching closing some divisions.

my guess is that most banks will take this lockdown period / virus as a reason to cull the headcount in the organisation… sad reality … never depend on an organisation for your livelihood.

Gil if your wife specializes in IT work for a bank group like absa, her salary must be at least double, if not more, what she is earning right now.

Find out from a labour law attorney – but 4 years continuously as a temp sounds wrong – speaking under correction but, i think the temp period is limited to 12 months, there after permanent

She only got the job because of her political affiliation, definitely not on merit.

Like most Managerial Jobs in this country!

These idiots have 1 ability. To Pass the buck to the guy at the bottom… nothing else.
Explains why the growth rate of the country is on a downhill…

We need more hands on CEOs…. Elon Musk… Steve Jobs …comes to mind

Did nothing much for Transnet nor for ABSA

Well, would the bank have paid her and the others that much if they thought they weren’t worth that much?

Proof right there that the inherent problem with these weak, overpaid appointments, lies DIRECTLY in the members of the board – who are themselves cut from the same weak cloth.

When the CEO underperforms, it is the members of the board who should be put on immediate notice.

So the one wolf will be accountable for the other wolf..

Which rock do you live under?

She has not done much over the last 25 years. Oh sorry forgot, demanded top dollar and got it and moved on.

She was not even the mastermind at ABSA, the amount of money spent on their entire branch renovations, R 1 Bil plus and the dubious loans to Steinhoff etc, oh and the whole Edcon saga and the cherry on the cake all the Barclays Africa spin off. Corporate stripping…JSE uninvestable, no sympathy for you muppets, move on.

Muppets ? Mr CT executive, be careful, what goes around comes around. It’s the muppets that are the cogs of all that happens.

I have harsher words but won’t get posted. Those who support and invest in evil JSE inc deserve thier comeuppance. Yes, karma is real, for some their poor returns.

Having read this, we came to the conclusion that they do not need our money.

She is canning herself laughing at all the comments, whilst sipping Bubbles with the connected one !(all black Supporter )

What was the correlation between remuneration and performance??

About 0.1%.

As an r value that is actually decent

R3.8 million for two months! To put in perspective, I know a banker who recently retired after 40 years service with the group. That is half his pension fund. She earned in two months half of a senior banker’s 40 years pensionfund build up.
On another point I agree with DragonX; CEO’s like Elon Musk, Steve Jobs earned everything coming their way. Why? Simply because they started the companies. That goes for someone like Adrian Gore as well. He started a company 20 years ago in a very competitive market and look where he is today.
But getting appointed in an age old existing company, share price went nowhere and getting rewarded like this is far out of context.

The figures cannot be true. That an individual working in a corporate environment can earn this type of money. Remuneration must be capped. It is no wonder the employees/workers get irate and despondent.

Who is to blame for excessive CEO pay?

The shareholders / owners of the company, as represented by the fund managers. The fund managers have consistently failed in their fiduciary duty to their fund members. The fund managers have voted for this extreme over payment.

Secondly it shows up the weak personal values of the CEO’s themselves.

If these CEO’s are so good, why do so many fail when they try to start their own companies?

This nonsense will stop when their is significant worker-representation at board level (like Germany).

Absa can pay a useless CEO R15m /year but only have R15m for Corona Virus assistance.. shows you how much they care. other companies give in the hundreds of millions but these idiot ANC connected so called execs in charge of this poor excuse of a bank can only manage what they paid the CEO last year. … And het total pay was probably more if you take into account the share options and other hidden perks.
Sickening
We should start asking these high powered fund managers what are they doing to stop this pillage and rape of the economy

Thousands of employees were retrenched last year including myself, reason being absa is cutting down costs, while CEO’s get paid millions like this. It is really unfair as we also have families to support in this lifetime.

End of comments.

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