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Here's Why Bendigo and Adelaide Bank Limited's (ASX:BEN) CEO Is Unlikely to Expect A Pay Rise This Year

·3 min read

CEO Marnie Baker has done a decent job of delivering relatively good performance at Bendigo and Adelaide Bank Limited (ASX:BEN) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 09 November 2021. We present our case of why we think CEO compensation looks fair.

View our latest analysis for Bendigo and Adelaide Bank

How Does Total Compensation For Marnie Baker Compare With Other Companies In The Industry?

According to our data, Bendigo and Adelaide Bank Limited has a market capitalization of AU$5.2b, and paid its CEO total annual compensation worth AU$1.9m over the year to June 2021. We note that's a decrease of 11% compared to last year. Notably, the salary which is AU$1.17m, represents most of the total compensation being paid.

For comparison, other companies in the same industry with market capitalizations ranging between AU$2.7b and AU$8.5b had a median total CEO compensation of AU$2.1m. This suggests that Bendigo and Adelaide Bank remunerates its CEO largely in line with the industry average. Furthermore, Marnie Baker directly owns AU$8.7m worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2021

2020

Proportion (2021)

Salary

AU$1.2m

AU$1.2m

61%

Other

AU$752k

AU$957k

39%

Total Compensation

AU$1.9m

AU$2.2m

100%

Speaking on an industry level, nearly 64% of total compensation represents salary, while the remainder of 36% is other remuneration. Our data reveals that Bendigo and Adelaide Bank allocates salary more or less in line with the wider market. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

ceo-compensation
ceo-compensation

A Look at Bendigo and Adelaide Bank Limited's Growth Numbers

Bendigo and Adelaide Bank Limited has reduced its earnings per share by 9.6% a year over the last three years. Its revenue is up 15% over the last year.

Investors would be a bit wary of companies that have lower EPS On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Bendigo and Adelaide Bank Limited Been A Good Investment?

Bendigo and Adelaide Bank Limited has generated a total shareholder return of 2.5% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

To Conclude...

The overall company performance has been commendable, however there are still areas for improvement. Despite robust revenue growth, until EPS growth improves, shareholders may be hesitant to increase CEO pay by too much.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 3 warning signs for Bendigo and Adelaide Bank (2 make us uncomfortable!) that you should be aware of before investing here.

Switching gears from Bendigo and Adelaide Bank, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.