Commonwealth Bank of Australia on Tuesday (August 8) scrapped its chief executive's bonus for damaging the bank's reputation amid allegations it broke money-laundering and counter-terrorism financing rules, but said he retained the board's confidence.
Australia's financial intelligence agency last week accused the bank of roughly 53,700 breaches, launching a civil court action that could see the country's biggest lender fined several billion dollars.
The case is the largest of its kind in Australian corporate history, and sent Commonwealth Bank shares sliding for their biggest one-day decline in 18 months on Friday (August 4).
The board said it had cut short-term bonuses to zero for the chief executive, Ian Narev, and other top executives for the year to June 30, 2017. The move, designed to soothe public concerns, came a day before the bank releases its annual results on Wednesday (August 9), with analysts tipping record cash earnings of A$9.8 billion ($7.78 billion).
Commonwealth Bank paid Narev A$2.9 million in short-term bonuses as part of a total package of A$8.8 million in 2016.
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