BANKING

Almost R100,000 a day for 14 years – Mike Brown’s insane pay as Nedbank CEO – BusinessTech

From 31 May 2024, Mike Brown will no longer be the CEO of Nedbank. However, over his 14-year tenure at the helm, he received  R477 million in salaries, bonuses, and long-term incentives.

Averaged over his entire tenure, this amounts to R93,400 a day.

The bank announced the search for a new CEO in June 2023 before finding his replacement in November of that year, Absa’s financial director Jason Quinn.

Mike Brown has been the CEO of Nedbank since 2010, and the group credits him with turning it into a digital banking powerhouse, which created significant value for shareholders.

Under Brown’s stewardship, the group successfully navigated an ever-increasing complex and uncertain operating environment, including steering the Nedbank ship through various domestic and internationally induced crises, the most recent being the Covid-19 pandemic, ensuring that the Nedbank Group emerged stronger, the chairperson Daniel Mminele said.

As a result, Brown was rightly honoured with the Sunday Times Business Leader of the Year award in 2020 – a testament to the respect and admiration of his peers, he added.

Mike Brown’s dedication extended beyond the financial sector, as he actively supported various social and environmental initiatives.

He played a pivotal role in the CEO Initiative, served as Deputy Chairman of Business Leadership SA, and was a former Chairman of the Banking Association of South Africa.

“After 6 years as CFO and then 14 years as CE of Nedbank Group, I look back with pride on our achievements and the challenges we have overcome together.

“I leave behind a Nedbank that is stronger, more competitive, more agile, and more digital than when I was first appointed as CE, and I know Jason will continue to build on these foundations to make Nedbank an even better bank than it is today,” said Brown.

Nedbank currently boasts a market capitalisation of more than R104 billion, making it one of Africa’s largest banks in terms of valuation.

Mike Brown
Nedbank CEO Mike Brown

How much Brown made

Over his 14-year tenure, Brown earned just over R477,218,000 or R93,400 a day – which included a base salary, short-term incentives, long-term incentives, a pension, and other benefits.

Mike Brown’s awarded remuneration for 2023 increased by 6.3% compared to a 176.4% increase in the total single-figure remuneration.

This increase in single-figure remuneration can be attributed, in the main, to the following:

  • Share price appreciation of 67% from award in 2021 to the end of 2023;
  • An overall vesting outcome on the 2021 LTI award of 124.8%, compared with 0% in 2022; and
  • A 100% MSS match, compared with 0% in 2022.

For 2023, his base salary was R10.1 million, with a bonus of R18.27 million (cash + shares) and a R53.3 million single-figure LTI concluded on 31 December 2023.

Considering Brown will still stay on after 31 May in an advisory role until August; the bank noted that his base salary would accordingly be reduced by 25% from 31 May 2024.

He will be eligible for a pro-rated STI award in March 2025, considering the partial period of employment in the 2024 financial year.

He will not be eligible for an LTI award in March 2025.

Mike will be eligible for good-leaver status in respect of previously awarded, but unvested, LTI and STI awards that will continue to vest over their remaining life.

Mike has agreed to sign a restraint of trade agreement, which will be effective until 31 May 2026, in return for which an LTI award at 50% of his 2024 March annual award will be made in August 2024.

The table below shows Mike Brown’s compensation over his 14-year tenure, including his basic salary, benefits, bonuses, and LTIs.

Year Total Compensation
2010 R12 459 000
2011 R26 137 000
2012 R28 747 000
2013 R32 532 000
2014 R35 050 000
2015 R22 925 000
2016 R22 281 000
2017 R37 605 000
2018 R53 008 000
2019 R33 684 000
2020 R20 281 000
2021 R26 543 000
2022 R33 466 000
2023 R92 500 000
Total R477 218 000

Read: New bank in South Africa gets the green light

Source link