EUR 1000.00 For Business Accounts Only

CaixaBank – AGM 21 May 2020

Caixabank postponed the AGM initially called for the 2nd of April in light of COVID-19. In this new call, the Company has reduced the dividend amount to be distributed on 2019 results, from €0.15 to €0.07, a reduction of 59% from the 2018 total dividend. We welcome the reduction, albeit we regret that Caixabank has already paid the final dividend before the approval by the AGM. However, ECGS recommends that companies postpone decisions regarding dividends as to avoid liquidity or financial risks. Therefore, we advise that shareholders oppose item 4.

 

In item 7, the Board asks for the authorization to increase the share capital by up to maximum 50%, with the power to exclude pre-emptive rights in connection with up to 20% of the issued shares. This limit shall not apply to capital increases that the Board may approve to meet the conversion of convertible bonds. The limit of 20% exceeds the ECGS' voting policy limit of 10%. Likewise, in item 8, the Board asks for the authorization to acquire treasury shares representing, together with the treasury shares already held, no more than 10% of the issued share capital. The maximum price for repurchase will be up to 15% above the market price, which is above the ECGS' voting policy limit of 10%. Hence, we recommend opposition to both items.

 

In item 9, shareholders are called to a binding vote on the 2020-2022

 

Directors' remuneration policy. The overall variable remuneration is reasonable. The Company has removed 3 items initially proposed relating to executive remuneration and we commend that decision. However, we note that the CEO's fixed remuneration significantly exceeds the median at large European banks and Spanish companies. We also strongly regret that 50% of the executive Directors' bonus is based on undisclosed individual conditions, and that most of the variable remuneration (84%) depends on annual results. Therefore, we recommend opposition. For same reasons and due to the lack of disclosure of short-term performance conditions, we also recommend to oppose the advisory vote on the Annual Remuneration Report in item 14.