HSBC boss Michael Geoghegan confirmed today that he will hand up to £4 million of his bonus payouts to charity as the banking giant reported a 56% rise in annual profits.
The group said it made 13.3 billion US dollars (£8.8 billion) in underlying pre-tax profits last year, up from an adjusted 8.6 billion dollars (£5.7 billion) in 2008.
Its chief executive said he would pass on his £4 million bonus entitlement - which will be paid in deferred shares - to charities around the world over the next three years.
HSBC chairman Stephen Green has also waived his entitlement to annual bonus shares.
But the bank revealed it will hand share windfalls to other senior executives - including a £9 million payment to its investment banking head, Stuart Gulliver.
Finance director Douglas Flint will take a £1.2 million bonus, although all the senior executive payments will be made in shares and deferred.
On a reported basis, HSBC’s results showed a 24% slide in annual profits to 7.1 billion dollars (£4.7 billion) after one-off factors and write-downs on the value of its assets.
But with these stripped out, HSBC saw a marked improvement thanks largely to a 148% surge in profits for its investment banking arm, HSBC Global Banking and Markets.
The bank’s five biggest earners will take away bumper pay packages from the year’s improved performance, earning a combined £35 million in bonuses last year, according to its annual report published alongside today’s results.
Britain’s public purse will benefit to the tune of 355 million dollars (£234 million) in payments under the Government’s one-off bonus tax.
Mr Green pledged an end to the days of guaranteed bonuses under an overhaul of the bank’s pay policies, which will also see less reliance on bonuses and an increase in basic salaries as a proportion of total remuneration.
"We have witnessed unacceptable distortions - from rewards linked to unsustainable or illusory day one revenues, which encouraged risk-taking; to multi-year guaranteed bonuses with no performance criteria," he said.
He added: "Remuneration must be firmly tied to sustainable performance and must not reward failure."