Should You Worry About Commerzbank AG's (ETR:CBK) CEO Pay?

Martin Zielke has been the CEO of Commerzbank AG (ETR:CBK) since 2016. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Commerzbank

How Does Martin Zielke's Compensation Compare With Similar Sized Companies?

According to our data, Commerzbank AG has a market capitalization of €7.2b, and paid its CEO total annual compensation worth €3.1m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at €1.3m. We looked at a group of companies with market capitalizations from €3.7b to €11b, and the median CEO total compensation was €3.1m.

So Martin Zielke is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

You can see, below, how CEO compensation at Commerzbank has changed over time.

Is Commerzbank AG Growing?

On average over the last three years, Commerzbank AG has grown earnings per share (EPS) by 58% each year (using a line of best fit). In the last year, its revenue is up 2.5%.

This demonstrates that the company has been improving recently. A good result. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.

Has Commerzbank AG Been A Good Investment?

Given the total loss of 21% over three years, many shareholders in Commerzbank AG are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Martin Zielke is paid around the same as most CEOs of similar size companies.

We like that the company is growing EPS, but it's disappointing to see negative shareholder returns over three years. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Commerzbank.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

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