2011 was a topsy year in the markets, especially for consumer and investment banks. While most banks lost considerable amounts of their market capitalization, (most) CEO salaries and earnings were on par with previous year’s.
Dick Bove a analyst at Rochdal Securities, calculated the following divergence between CEO pay and their company’s market cap.
While the nation’s biggest financial institutions saw their market capitalization drop by an average of 11.1 percent.
We don’t have access to the full list of Bank CEO salaries in 2011, but here are two investment banks and one consumer bank that (in our opinion) payed out far more than what their talent is worth.
Bank Bonuses Not Synced with Capitalization
Jamie Dimon, CEO of JP Morgan Chase,
earn took home $42 million. JP Morgan Chase (Stock: JPM) lost 23% of their Market Capitalization.
- Jamie Dimon earned $42M in salary, bonus and stock options in 2010
- Jamie Dimon earned $1.3 pay package in 2009 (JP Morgan Earned $11.7B in Profit)
Lloyd Blankfein, CEO of Goldman Sachs,
earn took home $21.7 million. While the huge investment bank took a 46.4% Market Capitalization Hit.
- Lloyd Blankfein earned $13.2M in 2010 (source)
In 2009, amid a widespread public outcry over sky-high pay on Wall Street, Mr. Blankfein and other senior Goldman executives received compensation packages valued at $9 million each. In 2007, the year before the financial crisis, Mr. Blankfein made $68.5 million.
Brian T. Moynihan, CEO of Bank of America,
earn took home just $2.26 million. While his bank lost 60% of their Market Capitalization.
- Brian Moynihan took home $10M in 2010 (source)
A Return to Fair Pay?
An interesting note, was that Richard D. Fairbanks, CEO of Capital One, took home a modest $100,637. This is pretty fair considering that the Capital One lost 2% of their market capitalization.
US Bancorp’s CEO Richard Davis earned an impressive $7.32, while managing his bank’s lost to only 0.3% of their Market Capitalization.
These two CEOs were the least-payed bank heads, but shows that fair bank compensation is still alive in the market. Whatever your opinion on bank compensation you have to point out that Capital One and US Bank (US Bancorp) can show responsible compensation packages.
What’s ahead in 2012?
Analysts see 2012 as a growth year and may have a dramatic impact on CEO pay and their company’s market cap. Some expect that bank’s market cap growing significantly.
Tell Us Your Opinions?
Photo Credit: International Money Pile in Cash and Coins by epSos.de, on Flickr