The derivatives boutique revamped pay practices after returning to profitability under a new CEO. The new model makes co-founder and ex-Chief Executive Jan Schoch look almost modest.
Leonteq co-founder Lukas Ruflin took the top spot at the structured products boutique last May – and earned 1.55 million Swiss francs ($1.55 million) for eight months last year. Ruflin's salary comes against the backdrop of a return to health for Leonteq.
Ruflin's predecessor and erstwhile associate Jan Schoch, who was ousted nearly two years ago, was frequently not Leonteq's top earner. In the years when the company disclosed his pay, he consistently earned less than Ruflin did for 2018.
Staggered Pay
If Ruflin's salary last year is annualized, he would have outpaced investment solutions head David Schmid as Leonteq's top earner (Schmid took home 2.27 million last year). The bonus pot for Ruflin and six other top executives expands if Leonteq hits targets for spending cuts and revenue; the CEO could be in line for 3.35 million francs if so.
Top management is in line for a maximum of 13.4 million francs – which is less than shareholders approved at last year's annual meeting. In theory, the seven top executives were entitled to nearly 1 million francs more for the year, between them.
As is common in the financial services industry, Leonteq staggers bonus payments over several years. The payouts are also tied to share price developments as well as return on equity over three years: if Leonteq doesn't deliver, as much as 60 percent of bonuses is imperiled.
Modest Board
To hit the maximum salary and bonus, Leonteq's return on equity needs to top 18 percent. This is a stretch since Leonteq needs to deliver more profits to maintain last year's ROE, following the cash call.
Pay for Leonteq's board, led by British-Swiss banker Christopher Chambers, is decidedly more modest: Chambers earned 350,000 francs last year, half in Leonteq stock. Pierin Vincenz, who stepped down as chairman two years ago, had originally earned 750,000 annually, before bowing to shareholder pressure and relinquishing one-third of his 2016 paycheck.
Under Ruflin, employees are also earning more: Leonteq paid an average of 237,000 francs last year – a rise of 9,000 francs on the year. The CEO is also one of the company's biggest shareholders with a more than 8 percent stake, or 1.2 million shares. However, Leonteq isn't paying a dividend for 2018.
