Below is a description of the remuneration principles of United Bankers Plc and the main features of the share-based incentive plan targeted for the company’s management. The company’s remuneration policy complies with the relevant binding rules and the interpretations and regulations of the Financial Supervisory Authority concerning remuneration.
United Bankers' Board of Directors has a remuneration committee, which consists of Johan Linder, Rainer Häggblom, Tarja Pääkkönen and Lennart Robertsson. The compliance function is involved in the planning of the remuneration policy and remuneration practices, ensures that the company's remuneration systems comply with the law, and reports annually to the Board of Directors.
The Board of Directors of the company has on 25th of February 2021 approved the updated Remuneration Policy for Governing Bodies which describes the principles within which United Bankers remunerates the members of the Board and the CEO. Remuneration policy will be discussed at the Annual General Meeting 2021. The company will also prepare a remuneration statement for 2020 which will be presented for the Annual General Meeting and published in 2021.
United Bankers’ Board of Directors has also approved a written document called “General remuneration principles” for United Bankers Group containing guidelines for the remuneration of the group companies management and employees. In addition to the general principles, United Bankers has a share-based incentive plan for key personnel approved by the Board of Directors, as well as subsidiaries’ incentive plans.
The share-based incentive plan for key personnel applies to persons at United Bankers whose professional activities have a material impact on the company’s risk position pursuant to the Credit Institutions Act. These include the CEOs of the United Bankers Group companies, the members of the Management Team and the heads of business areas. Other employees relevant to United Bankers’ risk position, such as those working in the company’s compliance and risk management functions, as well as the company’s IT and financial management, are not included in the above-mentioned share-based incentive plan.
United Bankers’ remuneration system must be in line with the company’s business strategy, targets, values and long-term interests and be consistent with and promote good and effective risk management.
The remuneration criteria applied to United Bankers Group’s key personnel and personnel with an effect on the company’s risk position must include qualitative criteria to encourage relevant individuals to act in the interest of clients.
The company’s Board of Directors oversees the remuneration of the persons in charge of the company’s control functions. The remuneration of a person working in a control function must be determined by the achievement of the goals defined for the purpose of control and should not be dependent on the result of the business unit the person oversees.
The remuneration system must define the ratio of fixed and variable compensation to be applied at any given time, and the extent to which the variable compensation may increase. The fixed compensation must be large enough to prevent a potential non-payment of the variable compensation from becoming unreasonable to the beneficiary.
The variable compensation must be based on an overall estimate of the performance of the beneficiary and the business unit concerned, as well as the overall performance of the company and United Bankers Group and United Bankers’ group performance development over time. The assessment of performance shall be based on long-term achievement of the result, taking into account economic and other factors.
The beneficiary’s right to variable compensation may arise and the compensation may be paid only if the beneficiary has complied with the regulations and guidelines binding the company and acted in accordance with company policies.
The rules of the remuneration system allow the company to decide that the variable compensation or part of it will not be paid or that the payment of the compensation will be deferred or will be made in several installments.
The amounts of variable compensation to be paid shall depend on at least the known and future risks, the cost of capital and the required liquidity at the time of the valuation, and the total amount of compensation paid shall not be such as to limit the recapitalisation of the company.
Below the capital adequacy threshold, the Board of Directors decides on the potential non-payment of the variable compensation or part of it.
The company may undertake to pay unconditional variable compensation only for particularly weighty reasons and provided that the promised compensation is limited to the first year of employment of the beneficiary.
Unless otherwise decided by the Shareholders’ Meeting, the variable compensation shall not exceed 100% of the total amount of the fixed compensation of each beneficiary. Variable compensation may not exceed 200% of the total fixed compensation.
If the amount of the variable compensation of a key person or person with an effect on the company’s risk position exceeds EUR 50,000, a part of the payment of the variable compensation will be paid later and a part of the payment will be paid other than in cash.
The Board of Directors monitors and evaluates the remuneration plans and remuneration principles annually. Changes to the terms and conditions of remuneration principles and plans require a decision by the Board.
Payment of remuneration is subject to current official regulations and the guidelines of the Financial Supervisory Authority.