Bank CEOs Party Like It’s 2006 After Splitting $250M in Compensations…

At this point, Goldman’s board should just let DJ D-Sol remix ‘Looking for a man in finance’ with the Chainsmokers… 

Remember when bank executives were hauled before Congress to explain why they were making nine figures while the global economy was actively collapsing? Yeah, neither do they. 

(Source: Giphy) 

In short, every CEO at the six largest U.S. banks just pulled down $40 million or more in annual compensation. (I’m not crying, you’re crying). Goldman Sachs' David Solomon led the pack at $47 million. Morgan Stanley's Ted Pick grabbed $45 million. Citi's Jane Fraser took home $42 million… plus a $25 million retention bonus in October, because apparently regular eight-figure pay isn't retentive enough. Oh, and Jamie Diamond Hands snagged $43 million while Bank of America’s Brian Moynihan capped $41 million (up 17% YoY). For all you peeps who don’t have calculators… that’s a combined haul north of $250 million for the six of them. Average raise being 22%. Woof.

(Source: Financial Times) 

Translation: Pimpin’ ain't easy, and neither is working on Wall Street (allegedly). Which means,  CEO pay at these banks is now running at roughly 298x the median employee salary. Meanwhile, the rank-and-file are watching inflation eat their modest wage bumps in real time. But hey, stock prices were up 42% last year, and in the immortal words of Wells Fargo analyst Mike Mayo: "It's bull market banking with bull market results and bull market pay." Directionally correct, indeed.

That said, the last time we saw numbers like this Michael Burry was about to drop the hottest mixtape of the 2000s. And yet, even then, Lloyd Blankfein pulled $68.5 million in 2007… a record at the time. Richard Fuld got $40 million that same year after Lehman posted "record profit." You may recall how that worked out for Lehman (and, uh, the rest of us). Fuld eventually got escorted out with no severance. Blankfein's peers at Morgan Stanley and Bear Stearns forfeited their bonuses as mortgage losses mounted.

(Source: Giphy) 

But, but, but… don’t you worry tinfoil hats, because the industry, we’re told “looks much different today.” Apparently, Dodd-Frank, Stress tests, and capital requirements has made Wall Street boards feel safe enough to start handing out pre-crisis-sized checks again. Especially given that banks did, in fact, have a banner year. Record earnings since 2021. Dealmaking came back. Trading printed. JPMorgan, Goldman, and BofA all boosted bonus pools by at least 10%. Fraser is 80% through Citi's restructuring. Charlie Scharf finally got the Fed's $2 trillion asset cap lifted from Wells Fargo after years of penance for the fake accounts debacle.

So clearly, the boards are happy, with the shareholders mostly approving the shenanigans. However, there’s  something almost poetic about DJ-Sol making $47 million while the rest of the industry sweats AI spending and headcount efficiency. But hey, that's the game: cut costs for everyone else, pay the guy at the top like it's 2006, and hope nobody remembers what happened in 2008. Spoiler: nobody ever does. Place your bets accordingly, friends. Until next time… 

At the time of publishing, Stocks.News does not hold positions in companies mentioned in the article.