Does SpareBank 1 SR-Bank ASA’s (OB:SRBANK) CEO Salary Reflect Performance?

Arne Austreid has been the CEO of SpareBank 1 SR-Bank ASA (OB:SRBANK) since 2011. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

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Check out our latest analysis for SpareBank 1 SR-Bank

How Does Arne Austreid’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that SpareBank 1 SR-Bank ASA has a market cap of øre27b, and is paying total annual CEO compensation of øre8.2m. (This figure is for the year to December 2018). That’s a notable increase of 29% on last year. We think total compensation is more important but we note that the CEO salary is lower, at øre3.5m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of øre18b to øre56b. The median total CEO compensation was øre7.8m.

That means Arne Austreid receives fairly typical remuneration for the CEO of a company that size. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at SpareBank 1 SR-Bank, below.

OB:SRBANK CEO Compensation, May 22nd 2019
OB:SRBANK CEO Compensation, May 22nd 2019

Is SpareBank 1 SR-Bank ASA Growing?

On average over the last three years, SpareBank 1 SR-Bank ASA has grown earnings per share (EPS) by 17% each year (using a line of best fit). In the last year, its revenue is up 18%.

This demonstrates that the company has been improving recently. A good result. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. Shareholders might be interested in this free visualization of analyst forecasts.

Has SpareBank 1 SR-Bank ASA Been A Good Investment?

Most shareholders would probably be pleased with SpareBank 1 SR-Bank ASA for providing a total return of 194% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

Remuneration for Arne Austreid is close enough to the median pay for a CEO of a similar sized company .

Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. So one could argue the CEO compensation is quite modest, if you consider company performance! Whatever your view on compensation, you might want to check if insiders are buying or selling SpareBank 1 SR-Bank shares (free trial).

If you want to buy a stock that is better than SpareBank 1 SR-Bank, this free list of high return, low debt companies is a great place to look.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.