Vontobel's shareholder meetings are generally a family affair – literally – but investors revolted this year. What happened?

«All motions proposed by the board of directors approved by a convincing majority», Zurich-based bank Vontobel said following its shareholder meeting this week. The euphemism only tells one side of the story: of 44 million total shareholder votes, descendants of Vontobel's founding family control 29 million – and can easily harness a majority view.

A closer look at the voting results belies Vontobel's buoyant view, especially on pay for CEO Zeno Staub and Chairman Herbert Scheidt. The bank's is Switzerland's most spendacious on average pay, as finews.com reported last month.

Pay Riles Investors

The generosity starts with Staub, who was paid 3.7 million Swiss francs ($3.7 million) last year, while Scheidt took home 2.6 million francs for his services. The paycheck seems to have riled many Vontobel shareholders.

Six million of them – or 40 percent of those not affiliated with the Vontobel family – voted against the bank's pay practices in a non-binding vote. In other words, even if the overwhelming majority of shareholders backed the pay scheme, Vontobel has an open revolt on its hands.

Frothy Salaries

Switzerland is known as a mecca for top executive pay: Julius Baer recently revealed a 6.2 million franc payday for «accidental» CEO Bernhard Hodler; Credit Suisse CEO Tidjane Thiam and UBS boss Sergio Ermotti took home 12.7 million francs and 14.1 million francs, respectively, for 2018.

To be sure, the three banks are heavily more profitable than Vontobel, and UBS and Credit Suisse are far more complex and intricate than Vontobel. The pay packages for Staub and Scheidt seem somewhat overheated when set against this context.

Vontobel CEO Staub effectively took home 1.6 percent of Vontobel's attributable net profit, while Scheidt grabbed a 1.2 percent slice. For comparison: Ermotti (once again Europe's best-paid banker) received 0.3 percent, Thiam 0.6 percent, and Hodler 0.8 percent.