It's Unlikely That Mizrahi Tefahot Bank Ltd.'s (TLV:MZTF) CEO Will See A Huge Pay Rise This Year

Key Insights

• Mizrahi Tefahot Bank to hold its Annual General Meeting on 20th of December
• CEO Moshe Lari's total compensation includes salary of ₪2.99m
• The overall pay is 276% above the industry average
• Mizrahi Tefahot Bank's total shareholder return over the past three years was 112% while its EPS grew by 43% over the past three years

Under the guidance of CEO Moshe Lari, Mizrahi Tefahot Bank Ltd. (TLV:MZTF) has performed reasonably well recently. As shareholders go into the upcoming AGM on 20th of December, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Mizrahi Tefahot Bank

How Does Total Compensation For Moshe Lari Compare With Other Companies In The Industry?

At the time of writing, our data shows that Mizrahi Tefahot Bank Ltd. has a market capitalization of ₪34b, and reported total annual CEO compensation of ₪4.4m for the year to December 2022. That's a fairly small increase of 7.3% over the previous year. We note that the salary portion, which stands at ₪2.99m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the Israel Banks industry with market capitalizations ranging from ₪15b to ₪44b, the reported median CEO total compensation was ₪1.2m. Hence, we can conclude that Moshe Lari is remunerated higher than the industry median.

Component	2022	2021	Proportion (2022)
Salary	₪3.0m	₪2.9m	69%
Other	₪1.4m	₪1.2m	31%
Total Compensation	₪4.4m	₪4.1m	100%

Speaking on an industry level, nearly 77% of total compensation represents salary, while the remainder of 23% is other remuneration. It's interesting to note that Mizrahi Tefahot Bank allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Mizrahi Tefahot Bank Ltd.'s Growth Numbers

Mizrahi Tefahot Bank Ltd.'s earnings per share (EPS) grew 43% per year over the last three years. It achieved revenue growth of 15% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Mizrahi Tefahot Bank Ltd. Been A Good Investment?

Boasting a total shareholder return of 112% over three years, Mizrahi Tefahot Bank Ltd. 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...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Mizrahi Tefahot Bank that you should be aware of before investing.

Switching gears from Mizrahi Tefahot Bank, 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.

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