ACB: Press Releases

Contact:	Robert Schmermund (202) 857-3104 Jim Eberle (202) 857-3145	Jim Eberle (202) 857-3145 (work) (703) 893-2593 (home) [email protected]	For Immediate Release September 12, 2003 #03-39
E-mail: [email protected]

ACB SURVEY FINDS INCREASES IN COMPENSATION AMONG EMPLOYEES AT COMMUNITY BANKS

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WASHINGTON, D.C. — The base compensation for community bank chief executives averaged $196,526 as of Jan. 31, 2003, an increase of about 11.5 percent over the previous year’s $176,230, according to America’s Community Bankers’ 2003 Compensation Survey.

Overall, bank employee staff salaries increased by an average of 4.3 percent, up from the average pay increases of 4 percent a year reflected in the survey for the past seven years.

“Despite a sluggish economy in 2003, community banks have been one of the bright spots, both in terms of performance and employee compensation,” said Rob Drozdowski, senior regulatory specialist and author of a commentary on the survey’s findings.

“Higher community bank salaries reflect the industry’s record earnings, fueled by strong asset growth and extraordinary mortgage lending and refinancing activity,” said Drozdowski. For example, the average base salary of senior loan officers in mortgage lending increased by 7.4 percent and their commissions doubled.

The ACB Compensation Survey, published annually for the past 30 years, is the oldest in the banking industry. It is the most comprehensive source of data and policies on compensation for community banks.

Anthony J. Monteverdi, chairman, president and CEO, Flatbush Federal Savings and Loan Assn., Brooklyn, N.Y., said: “ACB’s annual compensation survey is an invaluable resource that Flatbush Federal has used for years. The survey allows us to attract and retain the best employees by ensuring our compensation and benefits programs are competitive.”

Among CEOs, average base compensation ranged from $76,368 for institutions with less than $50 million in assets to $410,301 for institutions with more than $1 billion in assets. The average base compensation for CEOs in metropolitan areas was $221,139, up about 11.4 percent over the previous year.

Stock institution CEOs averaged base compensation of $218,942, about 11.3 percent above the 2002 survey; mutual holding company CEOs averaged $212,660, up 9.8 percent; and mutual institution CEOs averaged $164,861, a 9.6 percent increase. The difference between stock and mutual salaries reflected, in part, differences in average asset size.

The average base salary for CEOs at commercial banks was $214,784, an increase of 7.4 percent, and for CEOs at savings institutions, $189,984, an increase of 11.9 percent.

The average profit-sharing/bonus payment for CEOs in 2002 was $71,900, an increase of 38.5 percent from $51,894 in 2001. This component of total compensation for senior executives has fluctuated over the years because it tends to be more sensitive to bank performance than salary, Drozdowski explained.

For other community bank employees, Drozdowski said, “The survey showed a continuing trend to link salary increases to individual performance. Most community banks surveyed based increases in compensation on either individual performance or bank performance.”

About two-thirds (61.8 percent) considered individual performance in determining bonuses, and even more, 80.1 percent, used it in determining salary increases. Similarly, 77.2 percent used bank performance in determining bonuses and 28 percent used it in determining salary increases.

This year’s survey includes special white papers on ways to recruit new employees and retain existing employees; the escalating costs of health care; bank-owned life insurance-financed executive compensation; retirement program liability; and director compensation for public companies.

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The report was compiled from 430 banks participating in the survey. The survey contains a wider range of job descriptions and geographic scope than any similar publication. This edition includes compensation information on 177 community bank positions, five more than last year’s.

The survey is available as a 498-page manual or on a searchable CD-ROM, or as a discounted combined package. To order, visit www.AmericasCommunityBankers.com or call (888) 872-0568.

America’s Community Bankers is the national trade association committed to shaping the future of banking by being the innovative industry leader strengthening the competitive position of community banks. To learn more about ACB, visit www.AmericasCommunityBankers.com.

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