Banking bonuses are up by 10%. Unless you are the CEO
As we reported earlier this week, if your bonus is up by 10% this year, you are doing ok. Unless, that is, you are the CEO in which case a 10% rise puts you at the bottom of the pack.
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As banks steadily disclose pay packets for their CEOs, it's becoming apparent - once again - that many chief executives received hikes far larger than those accorded to their employees.
The biggest increase in total compensation so far went to Ted Pick at Morgan Stanley, who got a 34% hike and was warmly praised for increasing pre-tax profit at the bank by 25% last year. The smallest went to Jamie Dimon at JPMorgan, who received a 10% pay rise more aligned to his rank and file.
If you're CEO of a bank, it's not just about your annual salary and bonus, though. Dimon will be doing fine with his modest increase because he also has a $250m option grant awarded in 2021 which is coming due in July 2026. David Solomon has his extra $80m retention bonus which was issued in January 2025 and vests in 2030 (and which is already up 50% in line with Goldman stock). Jane Fraser at Citi was given a $25m retention bonus last October that vests in 2030.
CEOs are not normal people and are measured on different metrics. David Solomon, for example, was rewarded partly for "strong momentum" on executing strategic priorities. This may sound nebulous, unless you have organisational metrics at your fingertips, plus people who can configure PowerPoint slides showcasing your achievements.
Most CEO bonuses are deferred for at least three years. Ted Pick, for example, has to wait until 2029 to get 75% of his.
The big increases are a source of disgruntlement nonetheless, particularly for people who were zeroed or received a sub-inflation salary rise. "We had a record breaking year and we got nothing more, but the CEO got a double digit pay increase," says one of these individuals. "You couldn't make it up."
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