We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Sydbank A/S' (CPH:SYDB) CEO For Now

Performance at Sydbank A/S (CPH:SYDB) has been reasonably good and CEO Karen Frøsig has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 24 March 2022. However, some shareholders will still be cautious of paying the CEO excessively.

Check out our latest analysis for Sydbank

Comparing Sydbank A/S' CEO Compensation With the industry

Our data indicates that Sydbank A/S has a market capitalization of kr.13b, and total annual CEO compensation was reported as kr.7.9m for the year to December 2021. That's a notable increase of 8.6% on last year. In particular, the salary of kr.7.68m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the industry with market capitalizations between kr.6.7b and kr.21b, we discovered that the median CEO total compensation of that group was kr.4.7m. Accordingly, our analysis reveals that Sydbank A/S pays Karen Frøsig north of the industry median. Moreover, Karen Frøsig also holds kr.1.8m worth of Sydbank stock directly under their own name.

Component	2021	2020	Proportion (2021)
Salary	kr.7.7m	kr.7.0m	97%
Other	kr.245k	kr.300k	3%
Total Compensation	kr.7.9m	kr.7.3m	100%

Speaking on an industry level, nearly 83% of total compensation represents salary, while the remainder of 17% is other remuneration. Sydbank has gone down a largely traditional route, paying Karen Frøsig a high salary, giving it preference over non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Sydbank A/S' Growth Numbers

Over the past three years, Sydbank A/S has seen its earnings per share (EPS) grow by 9.5% per year. Its revenue is up 25% over the last year.

It's hard to interpret the strong revenue growth as anything other than a positive. And in that context, the modest EPS improvement certainly isn't shabby. We wouldn't say this is necessarily top notch growth, but it is certainly promising. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Sydbank A/S Been A Good Investment?

We think that the total shareholder return of 69%, over three years, would leave most Sydbank A/S shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

Karen receives almost all of their compensation through a salary. 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. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for Sydbank that investors should look into moving forward.

Important note: Sydbank 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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.