Shareholders Will Probably Hold Off On Increasing Public Bank Berhad's (KLSE:PBBANK) CEO Compensation For The Time Being

Key Insights

• Public Bank Berhad's Annual General Meeting to take place on 8th of May
• Salary of RM16.6m is part of CEO Ah Lek Tay's total remuneration
• The overall pay is 2,833% above the industry average
• Public Bank Berhad's EPS grew by 11% over the past three years while total shareholder return over the past three years was 13%

Under the guidance of CEO Ah Lek Tay, Public Bank Berhad (KLSE:PBBANK) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 8th of May. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Public Bank Berhad

How Does Total Compensation For Ah Lek Tay Compare With Other Companies In The Industry?

Our data indicates that Public Bank Berhad has a market capitalization of RM80b, and total annual CEO compensation was reported as RM51m for the year to December 2023. We note that's an increase of 13% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at RM17m.

For comparison, other companies in the Malaysian Banks industry with market capitalizations above RM38b, reported a median total CEO compensation of RM1.7m. Hence, we can conclude that Ah Lek Tay is remunerated higher than the industry median. What's more, Ah Lek Tay holds RM129m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	RM17m	RM14m	32%
Other	RM35m	RM32m	68%
Total Compensation	RM51m	RM45m	100%

Speaking on an industry level, nearly 40% of total compensation represents salary, while the remainder of 60% is other remuneration. Public Bank Berhad pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Public Bank Berhad's Growth Numbers

Over the past three years, Public Bank Berhad has seen its earnings per share (EPS) grow by 11% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. 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 Public Bank Berhad Been A Good Investment?

Public Bank Berhad has generated a total shareholder return of 13% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

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, 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.

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 1 warning sign for Public Bank Berhad that investors should look into moving forward.

Important note: Public Bank Berhad 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.