SoftBank slashed the wages of its top executives after its Vision Fund posted a historic loss of ¥3.5tn ($27.6bn) caused by a rout in tech stocks, rising interest rates and a regulatory crackdown in China.
Billionaire SoftBank founder Masayoshi Son’s pay has held steady at ¥100mn, according to regulatory filings to the Tokyo Stock Exchange. But chief financial officer Yoshimitsu Goto made ¥293mn ($2.3mn) in the past fiscal year ended on March 31, down from Y480mn a year earlier, and Ken Miyauchi, who runs SoftBank’s telecoms operations, earned ¥593mn compared with ¥635mn.
The Vision Fund’s performance pushed Son’s technology conglomerate to a record quarterly net loss of ¥2.1tn in the fourth quarter, driven by underperformance at Chinese ride-hailing group Didi Chuxing and South Korean ecommerce platform Coupang.
“The performance of the Vision Fund is obviously going to have influence on what the top executives are being paid,” said Kirk Boodry, analyst with Redex Research.
“Son’s salary doesn’t really have much of an impact on his net worth, which is much more closely linked to how SoftBank shares are doing given his stake in the company,” he added. Son owns about a third of the conglomerate.
Son tried to reassure investors earlier this month that SoftBank’s debt load was manageable when he revealed the historic loss in an unusually sombre presentation.
Some investors and analysts have expressed concerns over SoftBank’s finances because of the degree to which the company has used stakes in companies such as Chinese ecommerce group Alibaba and UK chip designer Arm to obtain loans to raise new funds for investment.
Son has said the company’s loan-to-value ratio stands at 20.4 per cent, below the 25 per cent threshold he has vowed not to cross “at normal times”.
He added that the company would embrace a more “defensive” posture, or slow down investments, because of the volatile market.
The filings were made ahead of SoftBank’s annual meeting on June 24 and also showed the tech conglomerate had trimmed borrowing from Mizuho, its main lender and Japan’s third-largest bank, by 4.5 per cent to ¥812bn.
Mizuho chief executive Masahiro Kihara told the Financial Times last month he was “totally unconcerned” about the SoftBank’s financial health despite the sell-off in tech stocks.
Goto has described the bond between SoftBank and its main bank as an “absolute relationship of trust”.
Borrowing from Wall Street banks also fell, with lending by JPMorgan and Goldman Sachs to SoftBank declining 23 per cent and 39 per cent respectively.
The filings did not disclose how much Rajeev Misra, a former Deutsche Bank trader who heads the Vision Fund, made in the past fiscal year. His pay more than doubled when SoftBank reported its previous worst performance on record two years ago, stirring controversy among employees.