Insights

Executive Compensation in the Banking Industry

Emerging Trends and Best Practices 2018

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Introduction This is Meridian’s fifth year tracking executive compensation practices at U.S. banks with assets above $10 billion. One theme remains consistent: programs continue to evolve. As we entered the 2018 year, companies invested much time and energy calculating the…

Pay Trends in the Financial Services Industry

Reprinted from the July/August 2018 issue of NACD Directorship magazine

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The financial crisis and recession may be history, but the impact these events have had on the financial services industry remains. Meridian Compensation Partners LLC, a consulting firm that serves clients on executive compensation and governance matters, has a dedicated…

Setting Goals to Incent High Performance

As seen in the 3rd Quarter 2018 issue of Bank Director

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High-performing banks define and execute their strategic vision by clearly articulating what they want to achieve and how they will do it. The old adage, “what gets measured, gets done”, is true when it comes to incentive plans. Companies that…

Addressing Compensation Issues In M&A

As seen in the 1st Quarter 2018 issue of Bank Director

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Consolidation in the banking industry continues, with more than 200 bank mergers in 2017. Whether your institution is a potential buyer or seller, there are several compensation matters that will need to be addressed proactively. Change-in-Control (CIC) Protections CIC arrangements…

Executive Compensation in the Banking Industry

Emerging Trends and Best Practices 2016-2017

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Introduction Bank executive compensation practices continue to evolve, as does the regulatory influence on pay programs. Eight years after the Dodd Frank Act was signed, incentive compensation rules under Section 956 of the Act remain outstanding and seem unlikely to…

Lessons From Wells Fargo: Forfeiture and Clawback Policies

The Wells Fargo & Co. sales incentive fraud scandal has further increased the scrutiny on banking industry compensation practices.

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As published in BankDirector.com By: Susan O’Donnell, Daniel Rodda| SEPTEMBER 13TH, 2017 Since 2010, banks have followed the Interagency Guidance on Sound Incentive Compensation Policies and reviewed their incentive plans to ensure they do not motivate inappropriate risk taking. However,…

Rewarding Executives for Successful Bank M&A

Aligning rewards with value enhancement will help shareholders understand the rationale behind them.

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This article originally appeared on BankDirector.com. Mergers and acquisitions (M&A) can create significant value for shareholders. Accordingly, bank executives should be rewarded when completing and integrating successful transactions. However, in today’s environment of heightened executive pay scrutiny, some approaches to…

Executive Compensation in the Banking Industry

Emerging Trends and Best Practices for 2015-2016

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This is Meridian’s third annual white paper on trends impacting the banking industry (see our 2014-2015 and 2013-2014 white papers). Our paper represents data from Meridian’s review of 2015 proxies for U.S. banks with assets between approximately $10 billion and…

How Pay Drives Performance

Meridian analyzes effective pay programs and explains what companies can learn from them.

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High performing banks execute customized strategies that deliver results. They have the vision, leadership, culture and incentive programs that help to attract, motivate and retain top talent. Leaders of high performing banks articulate their strategic direction with laser focus, communicate…

Trends Emerging in Compensation Policies for Bank Executives

Meridian examines policies for risk adjusting payouts, use of company stock, and retention of stock awards.

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Governance policies related to executive compensation are on the rise as a result of increased influence of bank regulators, shareholders and the Securities and Exchange Commission (SEC). These policies are intended to reduce compensation-related risk, encourage a long-term perspective and…

Advising the Banking Industry Through Intense Regulatory Reform

Meridian's Susan O'Donnell and Daniel Rodda discuss current issues in this interview with NACD Directorship magazine.

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Meridian Compensation Partners is an independent consulting firm advising clients on executive compensation and governance matters. While Meridian serves companies in all industries, a dedicated team of consultants specializes in assisting compen­sation committees for financial services companies. Meridian’s Susan C.…

Assessing Your Say-on-Pay Vote

What directors should understand about say-on-pay voting and how to improve results in the future.

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As banks prepare for their annual shareholder meetings, most will have a say-on-pay vote where shareholders indicate whether they sup­port the executive compensation program. This process has pressured companies to improve their compensation disclosures and clearly explain their pay practices…

Variations on “Conventional” Compensation Themes

There are many instances where a more customized approach to executive compensation is preferable and, frankly, more effective.

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Although very few companies have failed say on pay, the shareholder advisory vote on executive compensation has clearly impacted program design. Compensation committee members focus primarily on how shareholders will view a company’s pay programs. All too often, they also…

What’s New for Change-in-Control Agreements

In the banking industry, where mergers and acquisitions are common occurrences, change-in-control (CIC) arrangements can be a critical part of executive compensation programs

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In the banking industry, where mergers and acquisitions are common occurrences, change-in-control (CIC) arrangements can be a critical part of executive compensation programs. However, these arrangements are currently under scrutiny from shareholders, institutional investors, the media and most notably, proxy…

Executive Compensation for Banks

Responding to Regulatory Perspectives while Ensuring Pay for Performance

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How We Got Here: Recent Banking Compensation Regulations TARP Executive Compensation Regulations (American Recovery and Reinvestment Act of 2009) Requirements for banks who received TARP funds included: Set strict limits on incentive compensation Required mandatory clawbacks for materially inaccurate performance…

Does Your Company Stack Up?

Now is the Time to Test and Report Your Pay and Performance Relationship

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Creating alignment between pay and performance is critical in today’s environment of executive pay scrutiny. However, understanding how to assess the relationship and communicate it effectively can be challenging. There are many different methodologies and perspectives that should be considered.…

New Realities of Executive Compensation in the Banking Industry

The Impact of Regulatory and Shareholder Influence for 2013-2014

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Banks today are pulled in multiple directions. Shareholders and advisory firms like ISS and Glass Lewis seek strong alignment between executive pay and performance, while bank regulators prefer less leveraged, lower-risk pay programs. In the extreme, each suggests different pay…