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Here's Why Shareholders May Want To Be Cautious With Increasing Nordea Bank Abp's (HEL:NDA FI) CEO Pay Packet
Key Insights
- Nordea Bank Abp to hold its Annual General Meeting on 20th of March
- Total pay for CEO Frank Vang-Jensen includes €1.61m salary
- The overall pay is 62% above the industry average
- Nordea Bank Abp's EPS grew by 15% over the past three years while total shareholder return over the past three years was 62%
Under the guidance of CEO Frank Vang-Jensen, Nordea Bank Abp (HEL:NDA FI) has performed reasonably well recently. As shareholders go into the upcoming AGM on 20th of March, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.
View our latest analysis for Nordea Bank Abp
How Does Total Compensation For Frank Vang-Jensen Compare With Other Companies In The Industry?
At the time of writing, our data shows that Nordea Bank Abp has a market capitalization of €45b, and reported total annual CEO compensation of €4.2m for the year to December 2024. We note that's an increase of 15% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at €1.6m.
On comparing similar companies in the Finland Banks industry with market capitalizations above €7.4b, we found that the median total CEO compensation was €2.6m. This suggests that Frank Vang-Jensen is paid more than the median for the industry. What's more, Frank Vang-Jensen holds €3.0m worth of shares in the company in their own name.
On an industry level, around 68% of total compensation represents salary and 32% is other remuneration. In Nordea Bank Abp's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Nordea Bank Abp's Growth Numbers
Nordea Bank Abp has seen its earnings per share (EPS) increase by 15% a year over the past three years. It achieved revenue growth of 1.8% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Nordea Bank Abp Been A Good Investment?
Boasting a total shareholder return of 62% over three years, Nordea Bank Abp 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...
The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed 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.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 2 warning signs (and 1 which can't be ignored) in Nordea Bank Abp we think you should know about.
Switching gears from Nordea Bank Abp, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
Valuation is complex, but we're here to simplify it.
Discover if Nordea Bank Abp might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
Access Free AnalysisHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
About HLSE:NDA FI
Nordea Bank Abp
Offers banking products and services for individuals, families, and businesses in Sweden, Finland, Norway, Denmark, and internationally.
Adequate balance sheet average dividend payer.
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