Stock option schemes

We use stock options to encourage employee loyalty and to make the remuneration packages more flexible.

In addition to the time-based restrictions, from 2011 we have also established performance conditions for the exercise of the options.

Our stock option scheme has two main objectives:

  • on one hand, to encourage the loyalty of employees with essential or critical roles within the group, by providing them an incentive to stay at the company
  • on the other hand, to make the remuneration package more variable and flexible

The scheme is designed for employees with strategic roles for the achievement of the group's objectives. These are: directors with executive responsibilities; heads of the main business lines, geographical areas and other top executives; staff who take significant risks, or who have significant amount of variable remuneration; and other key staff members identified by the bank.

In 2011, the stock option scheme was converted into a performance stock option scheme with the introduction of performance conditions for exercise, in addition to the purely time-based requirements.

 

Stock option assigned and impact on share capital
 

Since 1999 five rights issues to service stock option schemes have been approved for a maximum total number of shares approved of 108.13 million, of which 79.82 million have been allocated. The last approval dates back to the extraordinary general meeting in 2007 when shareholders approved a rights issue for 40 million shares to service a stock option scheme to be exercised by 1 July 2022. The company bodies periodically assign quantities of stock options from the ceiling approved by the shareholders in general meeting. Of the shares approved in 2007, a total of 24.46 million have been assigned and their use is not currently envisaged by the current plan.

Of this scheme, a total of 150,000 options awarded in 2011 at a price of €6.430 per share are still outstanding, and are exercisable up to the financial year ending 30 June 2019.. 

The impact on the value of the shares and on the possible dilution of the share capital from the equity instruments (including performance shares) is not significant due to the presence of several schemes and several instruments covering different years and with vesting and holding periods running over a medium/long-term period.

EXTRAORDINARY GENERAL MEETING HELD ON N. OF SHARES APPROVED AWARDS EXPIRE ON DEADLINE FOR EXERCISING THE OPTIONS N. OF SHARES ASSIGNED
29 March 1999
30 July 2001
3,130,000 30 July 2006 31 December 2011 3,130,000
30 July 2001 50,000,000 30 July 2006 1 July 2015 48,401,500
28 October 2004 11,000,000 28 October 2009 1 July 2020 9,390,000
28 October 2004
Directors (1)
4,000,000 28 October 2009 1 July 2020 3,375,000
27 October 2007 40,000,000 27 June 2014 1 July 2022 15,536,000
TOTAL 108,130,000     79,832,500

 

(1) At a general meeting held on 27 June 2007, shareholders approved a proposal to award stock options to board members.

 

Last update: 31/10/2018