Citigroup (C) shareholders on Tuesday approved of the company’s compensation of executives and also sided with directors in rejecting a call for a special study of breaking up the big bank.
In the so-called “say-on-pay” referendum, nearly 64% of votes were cast to approve 2015 compensation awards, according to a preliminary count announced by the company at its annual general meeting in Miami.
Proxy advisory firms Institutional Shareholder Services and Glass, Lewis had recommended investors vote against approving last year’s payouts to executives.
The firms had said it was wrong for CEO Mike Corbat to have received a 27% increase in annual compensation, which boosted his total for 2015 to $16.5 million, even though the bank’s shareholder returns have lagged competitors.
Directors had said that Corbat delivered more improvements in company financial performance than were shown in the stock price in 2015. They also said Corbat’s pay should rebound from having been docked the year before because of past regulatory capital issues and fraud in a business in Mexico.
In another vote, only 3.5% of votes cast favored a breakup study of the bank, which is the fourth biggest in the United States by assets.
Chairman Mike O’Neill said at the meeting that the company’s strategy for its size and scope is based on extensive analysis, including three major studies over the past seven years. Corbat said Citigroup’s scale and business mix contribute to annual “operating efficiencies” of $8 billion to $12 billion.