Bank of America boosts Moynihan's annual compensation to a staggering $35 million for the year 2024.
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In 2024, CEO compensation packages in major U.S. banks have seen a notable shift, reflecting several evolving factors including performance metrics, regulatory disclosures, leadership development, and market conditions.
Key aspects of the evolution and influencing factors include:
Higher Average CEO Pay Levels
Average CEO total pay across banks and related financial sectors notably exceeds median industry salaries significantly, highlighting elevated compensation scales for top executives in 2024.
Shift Toward Performance-based Incentives
Compensation packages increasingly emphasize performance-based incentives beyond base salaries and bonuses, including deferred equity and phantom equity arrangements. This approach ties pay more closely to long-term value creation, client retention, and revenue generation rather than just asset growth.
Expanded Components Reflecting Leadership Development
Competitive packages now often incorporate leadership development stipends and coaching, recognizing executive presence and strategic leadership ability as critical factors impacting business success and compensation ROI.
Regulatory and Disclosure Influences
The SEC finalized "pay versus performance" disclosure rules as part of Dodd-Frank Act implementation, pushing banks to more transparently link executive pay to company financial measures. This regulatory environment applies more scrutiny to compensation structures and influences how pay packages are designed.
Strategic Focus of CEOs Influencing Pay
New CEOs at major banks, such as U.S. Bancorp’s CEO in 2025, focus on stabilizing expenses, driving organic growth, and transforming business lines to improve returns. Such strategic priorities, combined with bank financial performance, are factors that can influence compensation decisions.
Market and Economic Conditions
Expectations around loan demand affected by interest rate movements and overall economic stability contribute to shaping executive incentives related to performance targets and growth strategies.
Among the major banks, Bank of America paid CEO Brian Moynihan $35 million for 2024, a $6 million increase from 2023, representing a 21% rise in Moynihan's compensation. This increase was due in part to the bank's net income rising 2% year-over-year to $27.1 billion in 2024, and deposit growth outpacing the industry average.
Goldman Sachs CEO David Solomon received an $80 million bonus and a 26% raise in 2024, bringing his total compensation to $39 million. Capital One's CEO Richard Fairbank received a $31 million year-end incentive award, which includes $18.25 million tied to growth of shareholder value and adjusted return on tangible common equity. Fairbank's incentive award package also includes 102,440 target shares based on the company's performance from 2025 to 2027.
Capital One's shareholders meeting for the tie-up vote is scheduled for Feb. 18, and Fairbank will receive a $5.5 million deferred cash bonus, to be paid in 2028. JPMorgan CEO Jamie Dimon's compensation rose 8.3% to $39 million in 2024.
In conclusion, 2024 CEO compensation packages for large U.S. banks have evolved to become more performance and leadership-driven, influenced by regulatory transparency requirements and strategic business priorities, resulting in overall higher and more complex pay structures compared to prior years.
- The evolving CEO compensation packages in major U.S. banks in 2024 reflect a shift towards investing in leadership development, as competitive packages now often incorporate leadership development stipends and coaching.
- The growth in CEO compensation packages in 2024 is not solely based on asset growth but also on performance-based incentives such as deferred equity and phantom equity arrangements, which are tied to long-term value creation, client retention, and revenue generation.
