Here's the bank's statement:
'We are confident that our compensation decisions for 2012 are in the best interests of the firm and its future. They will help reinforce a culture of accountability, create the incentives necessary to execute our strategy, and deliver attractive returns to our shareholders.
UBS’s performance award pool for 2012 was reduced by 7% to $2.74bn compared with 2011, the lowest level since the beginning of the financial crisis and 42% below the 2010 level.
For 2012, we implemented significant changes to our compensation framework to better align employee and shareholder interests. The changes focus our employees on medium and longer term performance, provide them with the opportunity to benefit from the firm's longer term success, and simplify our compensation framework, making it more transparent. These changes include:
- longer deferral periods
- multi-year performance conditions on equity-based deferred compensation
- a new loss-absorbing high-trigger deferred capital instrument
- a reduction in the maximum amount of immediate cash paid as performance awards to individual employees
These compensation decisions, both with regard to our overall performance award pool, and to changes in our compensation model, are based on a variety of factors, including:
- The result of the vote on the 2011 Compensation Report at our 2012 AGM, which we took very seriously: we have had in-depth discussions with our largest shareholders to better understand their views with respect to improving our compensation plans and disclosures
- Our progress in executing our strategy, building our industry-leading capital position and reducing our risk-weighted assets
- The solid divisional results that we achieved in a challenging environment
- Our bottom-line performance, which has been impacted by issues from our past
- Our decision to exit certain businesses in the fourth quarter of 2012, which, although key to our strategy, has also had a negative impact on profitability in the quarter
- The need to attract and retain the best people to deliver superior performance for our clients and shareholders'