(The Canadian Press)

Canada’s Big 5 bank CEOs pay rises 6.5% to earn $54M in 2018

Volatility in equity markets last year also put pressure on the banks’ valuations

The chief executives of Canada’s five largest banks collectively earned roughly $63.2 million in total compensation during the 2018 financial year, up about 12 per cent from the previous year.

Based on the banks’ latest proxy circulars, Toronto-Dominion Bank’s chief executive Bharat Masrani received the highest overall pay for the 12 months ended Oct. 31, 2018 at $15.3 million in total compensation, which includes elements such as base salary, performance-based incentives and pension value.

That’s up roughly 23 per cent from Masrani’s $12.4 million in total compensation for the 2017 fiscal year, marking the biggest annual pay bump among the five bank chiefs.

The second-highest paid banking chief executive was Royal Bank of Canada’s Dave McKay, who saw an eight per cent pay increase to $14.5 million in total compensation, followed by Bank of Nova Scotia’s Brian Porter who received $13.3 million, up 3.2 per cent from the previous year.

The Bank of Montreal’s chief executive Darryl White received $10.1 million in total compensation in his first full year at the helm, up 22 per cent from fiscal 2017.

The Canadian Imperial Bank of Commerce’s chief executive Victor Dodig received roughly $10 million in total compensation in the 2018 financial year, up 6.5 per cent from a year earlier.

Excluding pension value and other miscellaneous compensation items, the five bank CEOs earned roughly $54.7 million in total direct compensation, up roughly 6.5 per cent from the 2017 financial year.

While a double-digit overall pay bump may make some bat an eye, the increase in compensation is reflection of the complexities in the financial sector that these CEOs face, said Bill Vlaad, president of financial services recruitment firm Vlaad and Co., which also monitors compensation trends.

The banking sector employs tens of thousands of people and each of the five financial institutions has a growing international presence, he said. What’s more, as more Canadians do their banking digitally, these banks are deploying more complex technology, Vlaad added.

“There’s a lot of pressure on these CEOs, more so than for a traditional CEO of an operational company,” he said. “I think that justifies a great deal of their compensation.”These pay hikes came as the Big Five banks delivered a collective $43.2 billion in net income for the 2018 financial year, up nearly 7.2 per cent from the prior year. The banks continued to churn out profits despite worries over stricter mortgage lending rules and trade uncertainty.

READ MORE: Hackers targeting Canadian banks, mining companies

However, the volatility in equity markets last year also put pressure on the banks’ valuations. When comparing the share prices of each bank from the beginning of the 2018 financial year on Nov. 1, 2017 to the end on Oct. 31, 2018, the results are mixed. At one end of the spectrum, Scotiabank’s stock had slipped roughly 11.3 per cent during that period from roughly $78 to $70. RBC’s shares in that period slipped one per cent from $96 to $95. BMO and TD’s shares increased by roughly 3.6 and 3.4 per cent, respectively, to approximately $97 and $72 during that time frame. CIBC, at the higher end of the range, saw its shares increase from $107 to $112, or about 4.7 per cent.

Most of the banks outperformed the S&P TSX Composite Index during that period, which slipped roughly 6.25 per cent to 15,027.28 on Oct. 31, 2018.

“Any company can justify increases in compensation if the shareholders are also making return on their investments that well exceeds the market,” said Vlaad.

Armina Ligaya, The Canadian Press


Like us on Facebook and follow us on Twitter.

Just Posted

Williams Lake speed skater qualifies for Canadian Western Speed Skating Championships

“I’m really proud of myself for achieving that.” - Leah Lauren

Amendments for Pinnacle Pellet focus of March 28 open house

“Our production will depend on the fibre profile in the region,” Loerke said.

One taken to hospital after motor vehicle incident on Mackenzie Avenue Tuesday

RCMP, CCSARS, EHS and Williams Lake Fire Department all respond

School board trustees put out the welcome mat for new superintendent

Ministry’s special advisor Mike McKay exits district as Chris van der Mark takes over

Cariboo Prince George MP slams Trudeau’s ‘coverup’ budget

Todd Doherty said the Conservatives plan to continue to oppose Mr. Trudeau’s coverup agenda

‘Full worm super moon’ to illuminate B.C. skies on first day of spring

Spring has sprung, a moon named in honour of thawing soil marks final super moon until 2020

40 records broken across B.C. as hot streak continues

Abbotsford hottest spot in Canada on Tuesday

B.C. wildfire prevention budget bulked up as dry spring unfolds

Night vision goggles tested for early detection effort

Vancouver driver ticketed twice within 6 minutes for same offence

The man was written up by two different officers for using an electronic device

B.C. teacher reprimanded after incident with Grade 11 student in school gym

Gregory Norman Brock was teaching at a high school in the Maple Ridge-Pitt Meadows School District

B.C. man ‘parks’ horse during liquor store pit stop

As long as animal wasn’t jaywalking, no problem, says Parksville official

Starbucks to test recyclable cups, redesign stores in B.C., U.S. cities

The company also said it plans to redesign its stores as it adapts to increasing mobile pick-up and delivery orders

In pre-election budget, Liberals boost infrastructure cash to cities, broadband

The budget document says the Liberals have approved more than 33,000 projects, worth about $19.9 billion in federal financing

‘That’s a load of crap’: Dog poop conspiracy spreads in White Rock

Allegation picked up steam through a Facebook page run by a city councillor

Most Read