This Is Why Berkshire Hills Bancorp, Inc.'s (NYSE:BHLB) CEO Compensation Looks Appropriate

Key Insights

• Berkshire Hills Bancorp's Annual General Meeting to take place on 21st of May
• Total pay for CEO Nitin Mhatre includes US$835.0k salary
• Total compensation is similar to the industry average
• Over the past three years, Berkshire Hills Bancorp's EPS fell by 3.3% and over the past three years, the total shareholder return was 13%

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Performance at Berkshire Hills Bancorp, Inc. (NYSE:BHLB) has been reasonably good and CEO Nitin Mhatre has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 21st of May. We present our case of why we think CEO compensation looks fair.

Check out our latest analysis for Berkshire Hills Bancorp

How Does Total Compensation For Nitin Mhatre Compare With Other Companies In The Industry?

Our data indicates that Berkshire Hills Bancorp, Inc. has a market capitalization of US$1.2b, and total annual CEO compensation was reported as US$2.7m for the year to December 2024. This means that the compensation hasn't changed much from last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$835k.

On examining similar-sized companies in the American Banks industry with market capitalizations between US$1.0b and US$3.2b, we discovered that the median CEO total compensation of that group was US$3.1m. This suggests that Berkshire Hills Bancorp remunerates its CEO largely in line with the industry average. Moreover, Nitin Mhatre also holds US$3.1m worth of Berkshire Hills Bancorp stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	US$835k	US$835k	31%
Other	US$1.8m	US$1.8m	69%
Total Compensation	US$2.7m	US$2.6m	100%

On an industry level, around 44% of total compensation represents salary and 56% is other remuneration. Berkshire Hills Bancorp pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Berkshire Hills Bancorp, Inc.'s Growth Numbers

Over the last three years, Berkshire Hills Bancorp, Inc. has shrunk its earnings per share by 3.3% per year. It achieved revenue growth of 33% over the last year.

The reduction in EPS, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Berkshire Hills Bancorp, Inc. Been A Good Investment?

With a total shareholder return of 13% over three years, Berkshire Hills Bancorp, Inc. shareholders would, in general, 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.

In Summary...

Some shareholders will be pleased by the relatively good results, however, the results could still be improved. Still, we think that until shareholders see an improvement in EPS growth, they may find it hard to justify a pay rise for the CEO.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Berkshire Hills Bancorp 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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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.