Bank boss has pay slashed after presiding over tech outages in 2023
Singapore's DBS wants accountability for digital dropouts
Singapore banking group DBS has slashed its CEO's variable pay by 30 percent as an accountability measure after digital disruptions hit the organization in 2023.
“The Board determined that the variable compensation for the CEO and other members of the Group Management Committee should be cut to hold them accountable for the series of digital disruptions during the year,” read a DBS press statement on Wednesday.
The committee, which includes other execs like DBS CFO Chng Sok Hui, received a milder 21 percent reduction from the previous year’s variable pay.
"We're taking accountability at the senior management, including, starting with me," CEO Piyush Gupta reportedly commented magnanimously during an earnings call. "I think that's a good element of governance – if you can establish accountability and figure, you know, that people take responsibility for making fixes, that's a good place to start."
Despite the income slashing, Gupta is still entitled to $4.14 million (USD) in 2023 variable pay alone.
His 2022 total pay package amounted to roughly $11.5 million, according to the company's annual report [PDF].
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The financial penalty for executives is a response to outages experienced in October of 2023 that resulted in full or partial unavailability of online banking apps for around two days. Customers and vendors were subsequently left without a way to make payments in a city-state that is increasingly reliant on digital financial systems.
The outage was eventually attributed to a technical issue in a datacenter cooling system. DBS could not fully recover its systems at its backup datacenter due to a network misconfiguration.
The Monetary Authority of Singapore (MAS) responded by slapping the bank with hefty fines. It barred DBS from reducing the size of its branch and ATM network, making any non-essential IT changes, or acquiring new business ventures for six months.
The bank was also required to apply a multiplier of 1.8 times to its risk-weighted assets for operational risk.
On Wednesday, DBS also boasted it made a roughly $60 million "whole of bank effort" towards improving technology and resilience.
$18.6 million of the total has already been spent on items like consultants and new hires in senior staff, including a head of tech risk and risk auditing personnel.
"These efforts will enable the bank to better pre-empt disruptions to its services, provide customers with alternate channels for payments and account enquiries during disruptions, and shorten incident recovery time," promised the bank. ®