With unemployment rates double what they were before the global economic crisis took hold in 2007, many have been forced to accept lower reductions or lost their jobs entirely. Meanwhile, executives at some of the country's largest banks have been given raises in recent years.
The salaries for the heads of the four largest Danish-owned banks, Danske Bank, Jyske Bank, Sydbank and Nykredit Bank, have risen 21 percent since 2007, all while the banks they run have experienced an average profit-downturn of nearly 80 percent.
The news comes from the independent think tank Cevea, which recently published a report revealing that banks have ignored many of the suggestions for shoring up the industry.
A number of the managing directors who were at the helm of their banks when the financial crisis began have received raises, many of which are twice as high as the average banking industry salary increase in the past five years.
Wages and profits increased at a rate of about 10 percent per year during the financial upswing between 2004 and 2007. But with bank profits down, Niels Mengel, the head of shareholders association Dansk Aktionærforening, said there was no argument for wage increases.
“That’s quite a poor signal to send, particularly during a crisis period,” Mengel told Jyllands-Posten newspaper. “Shareholders often have a difficult time preventing it from happening because voting limitations and a scattered ownership has made it hard to assemble resistance. This is a topic that should weigh heavily in future annual general meetings.”
All four executives declined to comment on the issue, according to Jyllands-Posten, but Jørgen Horwitz, the chief of the bank trade association Finansrådet indicated that the decision to give executives raises ultimately rested with the owners of the banks.
“Executive salaries are decided by the board,” Horwitz told Jyllands-Posten. “And as the board is assembled by the owners, then it’s also up to the owners to decide the pay and terms of employment.”