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Public Bank Rewards
It pays to be an executive or a director at a public bank. Literally.
CEOs, chief financial officers and directors of major exchange-traded banks are making significantly more than their peers at private banks, according to the results of Bank Director’s 2025 Compensation & Talent Survey. While this is not a surprise, it’s instructive to see how wide the gap is. The survey of fiscal year 2024 pay, sponsored by Chartwell Partners, shows that the median NYSE/Nasdaq bank CEO’s compensation was $1.81 million, more than quadruple the $370,236 at a private bank. Meanwhile, the total compensation of a chief financial officer at a major exchange-traded bank was $861,612 at the median versus $220,000 for a private bank. Much of the exchange-traded bank compensation is in stock versus salaries.
J. Scott Petty, a managing partner at Chartwell who has handled a lot of executive and board searches for small- and mid-cap and closely held private companies, explains that banks use peer data to determine CEO and CFO pay. Pay packages, in other words, are closely tied to the size of the bank, and most private banks in the survey are below $5 billion in assets. Publicly traded banks also require specialized skill sets, which justify the higher pay. CFOs at public banks have wider backgrounds in public finance and M&A, plus they must have good communication skills in presenting to investment bankers, equity analysts and shareholders.
Directors at major exchange-traded banks also get paid more than directors at private banks. Total director compensation is hard to calculate because, in part, pay varies based on committee assignments. But as an example, the median cash retainer for an outside director at a NYSE/Nasdaq bank was $48,500, compared with $12,000 at a private bank.
Petty explains that large, publicly traded banks are looking for specific expertise for their board, such an IT executive or chief information officer. Meanwhile, private bank boards typically are made up of large shareholders — joining a private bank board often comes with a financial obligation to buy the bank’s stock.
It's not all bad on private bank boards, however. The rewards can be much greater than any paycheck, such as the experience of supporting the local economy and small businesses. And as significant owners in the bank, shareholders are rewarded when the bank does well.
• Naomi Snyder, editor-in-chief for Bank Director
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