Here's Why We Think Bankwell Financial Group, Inc.'s (NASDAQ:BWFG) CEO Compensation Looks Fair for the time being

Key Insights

• Bankwell Financial Group will host its Annual General Meeting on 21st of May
• CEO Chris Gruseke's total compensation includes salary of US$630.0k
• The overall pay is comparable to the industry average
• Bankwell Financial Group's EPS declined by 24% over the past three years while total shareholder return over the past three years was 15%

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The share price of Bankwell Financial Group, Inc. (NASDAQ:BWFG) has been growing in the past few years, however, the per-share earnings growth has been lacking, suggesting something is amiss. Some of these issues will occupy shareholders' minds as the AGM rolls around on 21st of May. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

View our latest analysis for Bankwell Financial Group

How Does Total Compensation For Chris Gruseke Compare With Other Companies In The Industry?

According to our data, Bankwell Financial Group, Inc. has a market capitalization of US$268m, and paid its CEO total annual compensation worth US$1.0m over the year to December 2024. That's a notable decrease of 31% on last year. In particular, the salary of US$630.0k, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the American Banks industry with market capitalizations between US$100m and US$400m, we discovered that the median CEO total compensation of that group was US$980k. From this we gather that Chris Gruseke is paid around the median for CEOs in the industry. What's more, Chris Gruseke holds US$6.9m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	US$630k	US$630k	63%
Other	US$373k	US$832k	37%
Total Compensation	US$1.0m	US$1.5m	100%

On an industry level, roughly 44% of total compensation represents salary and 56% is other remuneration. Bankwell Financial Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Bankwell Financial Group, Inc.'s Growth

Bankwell Financial Group, Inc. has reduced its earnings per share by 24% a year over the last three years. Its revenue is down 24% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Bankwell Financial Group, Inc. Been A Good Investment?

With a total shareholder return of 15% over three years, Bankwell Financial Group, Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

Despite the positive returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about whether these returns will continue. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

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 1 warning sign for Bankwell Financial Group that investors should think about before committing capital to this stock.

Switching gears from Bankwell Financial Group, 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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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.