Joseph Ficalora has been the CEO of New York Community Bancorp, Inc. (NYSE:NYCB) since 1993. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Joseph Ficalora's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that New York Community Bancorp, Inc. has a market cap of US$4.5b, and reported total annual CEO compensation of US$4.6m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$1.4m. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$5.6m.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of New York Community Bancorp. Speaking on an industry level, we can see that nearly 58% of total compensation represents salary, while the remainder of 42% is other remuneration. It's interesting to note that New York Community Bancorp allocates a smaller portion of compensation to salary in comparison to the broader industry.
So Joseph Ficalora receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance. You can see a visual representation of the CEO compensation at New York Community Bancorp, below.
Is New York Community Bancorp, Inc. Growing?
Over the last three years New York Community Bancorp, Inc. has shrunk its earnings per share by an average of 9.1% per year (measured with a line of best fit). It saw its revenue drop 6.3% over the last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has New York Community Bancorp, Inc. Been A Good Investment?
Since shareholders would have lost about 15% over three years, some New York Community Bancorp, Inc. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
Joseph Ficalora is paid around what is normal for the leaders of comparable size companies.
Returns have been disappointing and the company is not growing its earnings per share. Few would argue that it's wise for the company to pay any more, before returns improve. Shifting gears from CEO pay for a second, we've picked out 2 warning signs for New York Community Bancorp that investors should be aware of in a dynamic business environment.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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