Here's Why We Think FB Financial Corporation's (NYSE:FBK) CEO Compensation Looks Fair for the time being

Key Insights

• FB Financial's Annual General Meeting to take place on 22nd of May
• Salary of US$765.4k is part of CEO Chris Holmes's total remuneration
• The overall pay is comparable to the industry average
• FB Financial's total shareholder return over the past three years was 23% while its EPS was down 8.6% over the past three years

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Despite FB Financial Corporation's (NYSE:FBK) share price growing positively in the past few years, the per-share earnings growth has not grown to investors' expectations, suggesting that there could be other factors at play driving the share price. Some of these issues will occupy shareholders' minds as the AGM rolls around on 22nd of May. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. 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 FB Financial

Comparing FB Financial Corporation's CEO Compensation With The Industry

According to our data, FB Financial Corporation has a market capitalization of US$2.1b, and paid its CEO total annual compensation worth US$3.9m over the year to December 2024. Notably, that's an increase of 33% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$765k.

For comparison, other companies in the American Banks industry with market capitalizations ranging between US$1.0b and US$3.2b had a median total CEO compensation of US$3.1m. From this we gather that Chris Holmes is paid around the median for CEOs in the industry. Moreover, Chris Holmes also holds US$19m worth of FB Financial 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$765k	US$711k	19%
Other	US$3.2m	US$2.2m	81%
Total Compensation	US$3.9m	US$3.0m	100%

On an industry level, around 44% of total compensation represents salary and 56% is other remuneration. In FB Financial's case, non-salary compensation represents a greater slice of total remuneration, in comparison 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 FB Financial Corporation's Growth Numbers

FB Financial Corporation has reduced its earnings per share by 8.6% a year over the last three years. Its revenue is up 2.2% over the last year.

Overall this is not a very positive result for shareholders. The fairly low revenue growth fails to impress given that the EPS is down. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 FB Financial Corporation Been A Good Investment?

FB Financial Corporation has served shareholders reasonably well, with a total return of 23% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

While it's true that shareholders have owned decent returns, it's hard to overlook the lack of earnings growth and this makes us question whether these returns will continue. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

So you may want to check if insiders are buying FB Financial shares with their own money (free access).

Important note: FB Financial 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.