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Banking Industry Incentive Practices

Our database provides insight on trends and emerging practices, including annual and long-term incentive plan practices.

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For the last seven years, Meridian has compiled a database on banking industry compensation practices for all public banks with assets greater than $10 billion. Our database provides insight on trends and emerging practices, including annual and long-term incentive plan…

Banking Industry Response to COVID-19

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Introduction The 2020 Coronavirus (COVID-19) pandemic represents one of the most significant global events in recent history, resulting in unprecedented impact on our country’s economy, its businesses and its people. For our financial services clients, initial priorities focused on the…

Board Compensation, Diversity Under Scrutiny

As seen in the 3rd Quarter 2019 issue of Bank Director

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Similar to trends in other industries, banks have been simplifying their director pay programs. Slightly more than half of publicly traded banks with $1 billion to $10 billion in assets increased cash retainers instead of offering board meeting fees. Board…

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,…

House Approves Financial CHOICE Act

On June 8, 2017, the U.S. House of Representative approved the Financial CHOICE Act (“CHOICE Act”), which, if approved by the Senate and signed by President Trump, would repeal and roll back significant portions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”). The House vote was 233 to 186, with one Republican opposing and not a single Democrat supporting the CHOICE Act.

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As reported in Meridian Client Update of May 12, 2017, the principal focus of the CHOICE Act is the banking provisions of Dodd-Frank and the Consumer Financial Protection Bureau. However, the CHOICE Act, if enacted, would make the following changes…

Bank Compensation and Governance in the New Era

Banks are often under greater regulatory scrutiny than companies in other sectors, and that trend is likely to continue.

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New compensation and governance standards are impacting boards of directors in all industries, but even more so in banking, which has more regulatory requirements and is under greater scrutiny. The recent Wells Fargo & Co. $185 million settlement over alleged…

Hot “Banking” Jobs: As Banking Changes, So Are the Job Titles

Banks are finding it increasingly necessary to look beyond a traditional financial services background when attracting new talent.

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Banks today must adapt to a world where “digital”, “cyber risk” and “fintech” are the new business lexicon. As the bulk of the workforce shifts from baby boomer to millennial, there is an increased need to attract talent from outside…

Compensation and Governance Committees: Sharing the Hot Seat in 2016

Compensation committees have seen increased scrutiny the past several years, and governance committees will likely see a similar focus in 2016.

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The compensation committee has been on the hot seat for several years. Outrage regarding executive pay and its perceived role in the financial crisis has put the spotlight on the board members who serve on this committee. Say-on-pay, the non-binding…

Executive Compensation in the Banking Industry

Emerging Trends and Best Practices for 2014-2015

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This is Meridian’s second annual white paper on trends impacting the banking industry (see “New Realities of Executive Compensation in the Banking Industry” for the 2013-2014 white paper). Our research for this paper represents data from Meridian’s review of 2015…

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…

When Constituency Compensation Expectations Collide

NYSE Board Governance Series: Discussion Of Relative Performance, Peer/industry Indices, and Regulatory Issues for Financial Institutions

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Members of the banking industry–and other regulated industries–have different expectations than members of other industries when it comes to executive compensation consulting. Watch Meridian Compensation Partners’ Susan O’Donnell sit down with TK Kerstetter of the NYSE Governance Series to discuss…

Responding to Pressure

How Regulators are Changing Bank Incentive Pay

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The Federal Reserve’s influence on incentive practices at the largest banks is cascading to regional banks. Although the final Dodd-Frank Act regulations have not been released, many banks are adjusting their incentive programs to respond to regulatory pressure. A Meridian…