South Africa’s retail banking chief executive officers are among the highest paid people in the country, as they continue to balance prudent fiscal management with turning a profit in a difficult micro- and macro-economic environment.
Looking at the financial data for the last financial years (all published in 2018), the average pay for the top retail banking executives came to almost R47 million, including all bonuses and benefits.
This means that a chief executive from a top five bank earned earned an average of R187,800 a day – on the basis of 250 work days in a year.
Taking only basic salaries into account (excluding bonuses), the figure drops to R36,560 per day – almost 85% more than the average South African earns in a month, and 38 times more than they earn in a day (R953).
Here’s how SA’s retail banking CEOs got paid in the 2017 financial year (2018 for Capitec), including how much they made per work day.
- Capitec CEO Gerrie Fourie – R226,560 a day
Fourie came out as the top-paid CEO among the country’s big five retail banks. He received a R56.6 million payout, thanks mainly due to a long-term incentive (LTI), along with a 10% increase in his basic pay package.
- FirstRand CEO Johan Burger – R215,560 a day
Burger was paid almost R54 million for the 2017 financial year – though this is for the year ended June 2017, so is not quite as up-to-date as the other groups. FirstRand’s new salary information will be published in October.
- Standard Bank CEO Sim Tshabalala – R194,000 a day
Tshabalala saw a 9% increase in his salary to R48.5 million for his first year as solo CEO at the bank. The payout includes a guaranteed salary of R9.1 million, and an annual bonus of R11.4 million. He was paid a further R14 million in an annual deferred award, as well as an additional R14 million as part of the group’s performance reward programme (PRP).
- Nedbank CEO Mike Brown – R152,480 a day
Brown earned a basic salary of R8.1 million, and scored bonuses worth R13.75 million. The rest of his pay package was made up of vested shares as part of his long-term (LTI) incentives and dividends paid, bringing the total to R38.124 million. The CEO was also awarded a R14.5 million worth of shares for the year, as part of his LTI.
- Absa CEO Maria Ramos – R150,240 a day
Ramos was the lowest paid, with a total pay package made up of a basic salary of R8.23 million, benefits of over R328,000, bonuses of R12.5 million and deferred income from previous years totalling R16.6 million.
The salaries below show the total remuneration received by the respective CEOs in the 2017 financial year, including the reported share values received as indicated in the annual reports.
FirstRand’s report is for the full year ending June 2017, and Capitec’s data is for the full year ending February 2018. Standard Bank, Nedbank and Absa’s data is for the full year ending December 2017.
The figures below represent the total packages, including short term and reported long term incentives.
|Bank||CEO||2017 Salary (Rm)||ZAR per work day||Excluding bonuses|
|Capitec||Gerrie Fourie||56.64||226 560||42 520|
|FirstRand||Johan Burger||53.89||215 560||38 960|
|Standard Bank||Sim Tshabalala||48.50||194 000||36 400|
|Nedbank||Mike Brown||38.12||152 480||32 400|
|Absa||Maria Ramos||37.56||150 240||32 520|
|Average||46.94||187 800||36 560|
* Salary of Former FirstRand CEO, Sizwe Nxasana
As is typical with executive pay, the biggest draw for CEOs comes through short-term and long-term incentive schemes, which pay out cash and share bonuses over a certain period, which often yields massive awards.
In 2017, this was no different, with the bulk of the CEO’s massive paycheques being made up of bonuses.
On a basic guaranteed package measure, the highest and lowest paid executives remain essentially the same, with Capitec CEO Gerrie Fourie topping with over R10 million. Absa CEO Maria Ramos earned only slightly more than Nedbank’s Mike Brown.
These incentive schemes pay out at different times, according to the specific contract with each respective CEO, and the executives are typically given an option to exercise their options, or to defer them to another time.