Details of Ermotti's pay were published in the bank's annual report on Friday, the same day that Hong Kong's de facto central bank rapped UBS for compliance failures over how it estimated the city's benchmark lending rate.

Switzerland's largest bank is grappling with the fallout from several major investigations, after paying $1.5 billion to global regulators in 2012 to settle allegations of interest-rate rigging.

UBS said on Friday that it was investigating its precious metals trading in a probe that grew out of global regulators' examination of alleged rigging in the $5 trillion-a-day foreign currency market.

Pay, a closely watched topic in Switzerland after voters last year backed some of the world's strictest controls on executive remuneration, comes under particular scrutiny at UBS because taxpayers funded a 6 billion franc bailout of the Swiss bank in 2008.

Ermotti's pay rose nearly 21 percent to 10.73 million Swiss francs ($12.30 million).

But UBS's highest-paid executive was investment banking chief Andrea Orcel, who earned 11.43 million francs in 2013. Chairman Axel Weber was paid nearly 6.1 million francs.

Last month, UBS drew fire for saying compensation at the bank was "normalised" from 2012 when it was fined.

Swiss shareholder groups and union representatives, who are using pay as political leverage ahead of a May 18 vote to introduce a minimum wage, criticised UBS's awards on Friday.

"This is a scandal," says Pepo Hofstetter of Swiss union Unia. "It shows how important it is to introduce a minimum wage, so that the lower income bracket can also benefit."

Swiss businesses and the government have both recommended voters reject the minimum wage of 22 Swiss francs ($25.21) an hour, saying it would threaten jobs and even the existence of smaller firms.

GOLD FIX, HONG KONG

In a ten-page chapter of the annual report detailing its legal woes, UBS said it "has taken and will take appropriate action with respect to certain personnel as a result of its ongoing review" of forex and precious metals.

Other legal headaches include Libor rigging, claims it misrepresented mortgage-backed bonds during the housing bubble, and back taxes due to Brazil dating back to when the Swiss lender owned an investment bank in the country.

Regulators including Germany's Bafin are looking more closely at how banks set benchmarks such as the gold fix after the Libor rigging scandal exposed widespread interest-rate manipulation.

Britain's Financial Conduct Authority has also said it was broadly looking at gold as part of an investigation into commodity benchmarks.

In January, Deutsche Bank said it was quitting the process after withdrawing from the bulk of its commodities business.

Five banks involved in setting the London benchmark gold price - Societe Generale, Deutsche Bank, Barclays, Bank of Nova Scotia and HSBC - are accused of price manipulation.

Ermotti said on Thursday that European banks are more concerned about being "too small to survive" than "too big to fail" due to the challenges they face from holding more capital and increased competition and costs.

($1 = 0.8727 Swiss Francs)

(Reporting by Caroline Copley and Katharina Bart. Additional reporting by Ruppert Pretterklieber in Zurich and Jan Harvey in London.; Editing by Erica Billingham)

By Katharina Bart