Notes to the financial statements 9c Compensation to the top management and the Group Executive Committee Compensation to the top mangement, SEK Variable Benefits 2007 Base salary salaries Remunerations1) and other2)) Total Chairman of the Board, Marcus Wallenberg Other members of the Board President, Annika Falkengren Total 7,000,000 7,000,000 4,000,000 4,000,000 2,600,000 5,470,000 8,070,000 1,106,016 1,106,016 2,600,000 5,470,000 12,106,016 20,176,016 2006 Chairman of the Board, Marcus Wallenberg Other members of the Board President, Annika Falkengren 6,170,000 2,778,750 2,600,000 5,470,000 1,048,069 2,600,000 5,470,000 9,996,819 Total 6,170,000 2,778,750 8,070,000 1,048,069 18,066,819 1) As decided at AGM. 2) Includes benefits for homeservice, company car and vacation payments, which in 2006 was included in base salary. The principles for compensation of the President and the other members of the Group Executive Committee were prepared by the Board and the Remuneration and Human Resources Committee of the Board and approved by the Annual General Meeting 2007. For more information, see page 48. Short Term Incentive Short term incentive for the Group Executive Committee are based on Group and divisional financial criteria, such as operating result, costs and other varying quantitative criteria. In addition to that there are individual qualitative criteria measured discretionary. All short term incentives to the Group Executive Committee members are maximised to a percentage of base salary. Long Term Incentive programme From 1999 to 2004, employee stock options have been used as the vehicle for SEB’s long term incentive programmes. For 2005, the Annual General Meeting decided on a programme with a new performance based structure in the form of performance shares. For more information, see note 9d on page 80. Performance shares and employee stock options cannot be sold nor pledged, which means that they do not have any market value. However, the calculated value for the 2007 programme at the time of the allotment was SEK 86 per performance share. The calculated value for allotted performance shares to the President is SEK 3,499,942 (2,849,990) and to the GEC excluding the President SEK 10,800,052 (10,255,765). The allotted performance shares that can be exercised will depend on the development of two predetermined performance criteria of equal importance, the real increase in earnings per share, 50 per cent, and the total shareholder return compared to SEB´s competitors, 50 per cent. Pension and severance pay Under the pension agreement of the President, Mrs Falkengren, pension is payable from the age of 60. The pension plan is defined benefit-based and inviolable. Pension is paid at the rate of 65 per cent of the pensionable income. Pensionable income consists of base salary plus 50 per cent of the average variable salary during the last three years, however limited to a maximum amount. Termination of employment by the Bank is subject to a 12-month period of notice and entitles to a severance pay of 12 months’ salary. As regards pension benefits and severance pay the following is applicable to the members of the Group Executive Committee excluding the President. The pension plans are inviolable and defined benefit-based except for two that are defined contribution-based. Pension is payable from the age of 60 at the rate of maximum 70 per cent of pensionable income up to the age of 65 and at maximum 65 per cent thereafter. Pensionable income consists of base salary plus 50 per cent of the average variable salary during the last three years. Termination of employment by the Bank is subject to a maximum 12-month period of notice and entitles to a severance pay of maximum 24 months’ salary. The Bank has the right to make deductions from such severance pay of any cash payments that the Executive may receive from another employer or through his/ her own business. 78 SEB ANNUAL REPORT 2007
