The Charles Schwab Corporation SCHW, in an annual proxy document filed with the Securities and Exchange Commission (“SEC”), announced a cut in the President and Chief Executive Officer (CEO) Walt Bettinger’s remuneration for 2014. Bettinger received $11.8 million as compensation package, marking a 7% decrease from 2013.
The CEO’s base salary remained unchanged at $1.0 million. Non-equity incentive plan compensation and other compensation rose over 26% year over year to $4.3 million. However, stock and option awards declined nearly 22% to $6.5 million on a year-over-year basis.
Apart from the CEO, five other senior executives including the Chairman Charles R. Schwab received a salary cut compared with last year’s remuneration. While the Chairman’s pay package of $4.97 million reflected more than a 9% reduction on a year-over-year basis, the compensations awarded to other senior officers reflected a year-over-year decline of around 5–10%.
Prior to the current pay reduction, Schwab raised the salary of its senior executives consecutively for two years owing to the improved profitability. Schwab delivered a positive earnings beat in two of the four quarters of 2014 with an average beat of 3.3%. In spite of the enhanced efficiency continuing throughout 2014, the executives’ compensation reflected a decrease.
Among other investment brokers, E*TRADE Financial Corp.’s ETFC CEO Paul Idzik received $5.3 million for 2014. Further, TD Ameritrade Holding Corp.’s AMTD CEO Fred Tomczyk received $7.5 million for fiscal year 2014 (ended Sep 30).
Presently, Schwab carries a Zacks Rank #3 (Hold). A better-ranked company in the same space includes Investment Technology Group Inc. ITG, which sports a Zacks Rank #1 (Strong Buy).
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