August 11, 2020 – A report by S&P said Charles Scharf, CEO of Wells Fargo, was the highest paid banking CEO in 2019, earning $36.4 million in total compensation. JP Morgan’s Jamie Dimon – the highest paid CEO in 2016-2018, took second place in $31.6 million.
Michael Corbat, Citigroup’s CEO, was awarded $8.3 million in cash compensation – the highest among bank CEOs, but Scharf and Dimon received stock grants worth $28.8 million and $24.5 million, respectively vs $17.2 million for Corbat.
Among the large universal banks, Brian Moynihan, CEO of Bank of America, enjoyed the highest year-on-year change with a 13.3% growth.
Mr. Scharf’s compensation was also notable as a ratio of CEO to median employee salary at an estimated 550x, according to S&P estimates. The CEO to median ratio is a metric increasingly monitored by ESG investors; for universal banks like Wells Fargo and JP Morgan that have commercial banking units, the ratio can be very large. The CEO to media ratios for JP Morgan, Citigroup and Bank of America were 393x, 482x and 276x, respectively.
Wells Fargo was a notable victor in the recent bond underwriter selection by New York City, one of the largest municipal bond issuers with $10-15B in annual issuance. The Charlotte-based bank remains under a Federal Reserve sanction imposing an asset cap on the bank’s assets, but in an appointment that shocked the market (Bloomberg story, may require subscription), the city dropped home-grown darling Goldman Sachs in favor of Wells.
Contact Kyle Skinner at KSkinner@buymuni.com.
