Here's Why Hvidbjerg Bank A/S' (CPH:HVID) CEO Compensation Is The Least Of Shareholders' Concerns

Performance at Hvidbjerg Bank A/S (CPH:HVID) has been reasonably good and CEO Jens Odgaard has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 17 March 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

Check out our latest analysis for Hvidbjerg Bank

Comparing Hvidbjerg Bank A/S' CEO Compensation With the industry

According to our data, Hvidbjerg Bank A/S has a market capitalization of kr.138m, and paid its CEO total annual compensation worth kr.2.0m over the year to December 2020. That's a fairly small increase of 6.7% over the previous year. It is worth noting that the CEO compensation consists entirely of the salary, worth kr.2.0m.

For comparison, other companies in the industry with market capitalizations below kr.1.3b, reported a median total CEO compensation of kr.2.8m. So it looks like Hvidbjerg Bank compensates Jens Odgaard in line with the median for the industry. Furthermore, Jens Odgaard directly owns kr.659k worth of shares in the company.

Component	2020	2019	Proportion (2020)
Salary	kr.2.0m	kr.1.9m	100%
Other	-	-	-
Total Compensation	kr.2.0m	kr.1.9m	100%

Talking in terms of the industry, salary represented approximately 83% of total compensation out of all the companies we analyzed, while other remuneration made up 17% of the pie. At the company level, Hvidbjerg Bank pays Jens Odgaard solely through a salary, preferring to go down a conventional route. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Hvidbjerg Bank A/S' Growth

Over the past three years, Hvidbjerg Bank A/S has seen its earnings per share (EPS) grow by 6.9% per year. Its revenue is down 9.8% over the previous year.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Hvidbjerg Bank A/S Been A Good Investment?

Boasting a total shareholder return of 38% over three years, Hvidbjerg Bank A/S has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Hvidbjerg Bank pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Hvidbjerg Bank that you should be aware of before investing.

Important note: Hvidbjerg Bank is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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