(Bloomberg) --

UBS Group AG Chief Executive Officer Sergio Ermotti’s pay fell 11% in 2019 and the bank trimmed the bonus pool after slashing its financial targets on a depressed outlook for lower-for-longer interest rates in Europe.

Ermotti earned 12.5 million francs ($12.9 million) in what will be his last full year as CEO of the bank. That includes 9.7 million francs in variable compensation, of which 1.5 million francs could be clawed back in the future because of a French legal case. In 2018, he received 14.1 million francs. The Zurich-based lender’s bonus pool last year fell 14% to $2.7 billion, according to its annual report published on Friday.

Like many of its European peers, UBS is grappling with the effects of negative interest rates, investor caution and trade tensions. As global wealth creation slows, the bank changed tack by taking away a target on growing wealth assets managed to providing more fee-generating services to each client. UBS is also facing an appeal trial in June over a $5 billion fine French prosecutors slapped on the bank for helping clients hide assets from tax authorities.

In a surprise announcement last week, the bank said Ermotti will step down in November and will be succeeded by ING CEO Ralph Hamers. Hamers’s pay at ING has been hamstrung by strict Dutch laws on CEO compensation; he has earned around $2.16 million annually in recent years.

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To contact the reporter on this story: Marion Halftermeyer in Zurich at mhalftermeye@bloomberg.net

To contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net, Ross Larsen

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