CALGARY - Shareholders made it known they're unhappy with rich payouts to two former executives at the Canadian Imperial Bank of Commerce's annual general meeting on Thursday.
An advisory resolution on the bank's approach to executive compensation was voted down by nearly 57 per cent of shareholders, with about 43 per cent voting in favour.
CIBC raised some eyebrows recently when it disclosed it planned to pay two retired executives a total of $25 million on top of their existing pensions, even though they no longer work for the company.
Under the "post-employment arrangements," former chief executive Gerry McCaughey will receive $16.7 million by April 2016, while former chief operating officer Richard Nesbitt will be paid $8.5 million, according to regulatory documents filed by the bank.
Thursday's vote is non-binding, but CIBC said in its proxy circular it would "consider the outcome of the vote as part of its ongoing review of executive compensation."
Outgoing chairman Charles Sirois said the vote's outcome should not be taken as "commentary to our overall approach to compensation."
In his speech to shareholders, CEO Victor Dodig kept the focus on the bank's accomplishments — especially when it comes to embracing new technology.
At the meeting Dodig — who took the top job last September — announced CIBC would have a mobile app for the Apple Watch, which launches Friday.
"There are some clients that just bank remotely. Today, four out of five transactions are done outside of our branches," said Dodig.
"So change is happening and, as clients further adopt these technologies, we expect that the role of the branch will further evolve."
The brick-and-mortar locations will be less about day-to-day transactions and more about "the relationship aspect and the advice aspect," he said. However, he acknowledges many clients — his mother included — will still want the option of lining up every week with their passbooks to deal with a bank teller.
David McVay, a personal financial services industry consultant, said CIBC's competitors are likely to follow suit with an Apple Watch app within the year, meaning its edge won't last long.
But McVay said "there is an image advantage from being first," especially for the younger demographic. Initially, CIBC users will be able to check their balance, review recent transactions, transfer funds and locate their nearest branch or ATM. The watch's small screen makes would make it tough to do much more than that.
Customers are likely to do their banking on their home computer, tablet or smartphone long before they use the gadget on their wrists, said McVay.
"Banking isn't that frequent a transaction like your emails and texts and that sort of thing."
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