Shareholders May Be Wary Of Increasing Banco Comercial Português, S.A.'s (ELI:BCP) CEO Compensation Package

The results at Banco Comercial Português, S.A. (ELI:BCP) have been quite disappointing recently and CEO Miguel Maya Pinheiro bears some responsibility for this. At the upcoming AGM on 20 May 2021, shareholders can hear from the board including their plans for turning around performance. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Banco Comercial Português

How Does Total Compensation For Miguel Maya Pinheiro Compare With Other Companies In The Industry?

Our data indicates that Banco Comercial Português, S.A. has a market capitalization of €2.3b, and total annual CEO compensation was reported as €1.1m for the year to December 2020. That's a notable increase of 21% on last year. We note that the salary portion, which stands at €650.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from €1.7b to €5.3b, the reported median CEO total compensation was €1.0m. So it looks like Banco Comercial Português compensates Miguel Maya Pinheiro in line with the median for the industry. Furthermore, Miguel Maya Pinheiro directly owns €93k worth of shares in the company.

Component	2020	2019	Proportion (2020)
Salary	€650k	€650k	61%
Other	€417k	€231k	39%
Total Compensation	€1.1m	€881k	100%

Talking in terms of the industry, salary represented approximately 74% of total compensation out of all the companies we analyzed, while other remuneration made up 26% of the pie. It's interesting to note that Banco Comercial Português allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Banco Comercial Português, S.A.'s Growth Numbers

Banco Comercial Português, S.A. has reduced its earnings per share by 10% a year over the last three years. In the last year, its revenue is down 7.9%.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Banco Comercial Português, S.A. Been A Good Investment?

With a total shareholder return of -45% over three years, Banco Comercial Português, S.A. shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Banco Comercial Português that you should be aware of before investing.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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