Suncorp bosses pocket millions in bonuses

EXECUTIVES at share-battered Suncorp had some bonuses crimped this year but still pocketed millions of dollars in cash and shares.

Topping the pay scales in the annual report out yesterday was Suncorp managing director John Mulcahy at $6.2 million (including shares given an accounting value of almost $2.8 million).
Brisbane-based Suncorp shares have fallen along with other financial stocks in the credit crunch. But specific concerns surrounding Suncorp include weakening profits (down 48 per cent to $556 million last financial year) and use of insurance reserves.
Suncorp argues funding is on track and lending has been conservative. It has forecast high single-digit growth in the banking arm, flatness in wealth management and an insurance trading ratio of 10-12 per cent for the insurance arm.
Mr Mulcahy, writing in the report, highlighted external factors impacting on the fiscal 2008 result and said the "underlying business performance remained solid".
But the profit fell short of hopes, he wrote.
"We cannot expect global or local economies to return to full health for at least the next year ... (so) we continue to work on improving the efficiency and cost management of all of our businesses."
Mr Mulcahy had a base pay of $1.9 million plus a short-term bonus of $1.2 million. (The previous year was $1.7 million base and a $2 million bonus).
He missed a large chunk of the bonus worth up to $3 million.
It is thought executive bonuses were hit after Suncorp missed market guidance.
The 247,920 performance shares Mr Mulcahy received were worth $2.6 million at yesterday's closing price of $10.45 (below all-time highs of $22.77).
The shares were 80 per cent of what he could potentially have earned. They were awarded in January and based on the best result out of a two-year period, as The Courier-Mail reported earlier.
A swathe of executives, including chief financial officer Chris Skilton, had cash bonuses trimmed.
Mr Skilton's reduced from $780,000 to $500,000, with his total pay package at $2.6 million.
A controversial share deal for some executives, which saw performance criteria wiped for 2005 due to the takeover of insurer Promina, also will result in 100 per cent of affected shares vesting despite Suncorp's performance being below the 50th percentile of peers.
That deal had attracted a backlash at last year's annual general meeting.
Suncorp non-executive chairman John Story's total pay package rose from $395,000 to $509,000