Ryan, Miller and Associates
2015 California Commercial Banking Salary Survey
Average Base Salaries -2014
|BANK ASSET SIZE||Chief Executive Officer or President||Executive VP
C-Level or Group Head
|EVP or SVP
|SVP or VP
|AVP or Associate|
|Over $ 10 Billion||$1,063,000||$476,000||$246,000||$155,000||$112,000|
|$ 3 to $ 10 Billion||$661,000||$346,000||$192,000||$131,0000||$91,000|
|$ 1 to $ 3 Billion||$492,000||$243,000||$166,000||$121,000||N/A|
|Under $ 1 Billion||$284,000||$172,000||$142,000||$107,000||N/A|
- CEO and EVP incentives are heavily weighted toward stock and/or options. CEO cash bonuses usually vary from 50% to 200% of base salary. CEO stock/option awards range from1 to 5 times base salary.
- EVP’s normally receive cash bonuses of 30% to 100% and 50% to 200 % of salary in stock/option awards.
- SVP-Managers cash bonuses range from 30% to 150% and stock/option awards are from 10% to 50% of salary.
- Business development-oriented SVP’s and VP’s receive cash bonuses ranging from 25 – 125% of base and sometimes more when incentives are tied to specific production and/or profits. Some portion of bonuses are deferred and allocated to non-cash awards for SVP or VP-level producers, particularly for bonuses over $ 100,000.
- SVP’s and below in non-production areas (Credit, Finance, Operations, etc.) typically average 15 – 60% cash bonuses.
- Base salaries of Business Bankers covering companies less than $ 20 MM in revenues for larger Banks are not included in the above Survey. Their bases are typically lower ($ 80,000 – $ 125,000 for VP’s) but many are paid quarterly commissions which enable the very top producers to earn $ 200,000 – $ 250,000 “all-in”.
- Survey results are from the Ryan, Miller and Associates database, which has salary information on over 1500 California bankers, and public records reporting executive compensation. Averages are calculated on the 10th to 90th percentiles to reduce the effect of outlier salaries.
- CEO and EVP compensation are for California-based Banks only. All other data pertains to Banks operating in California irrespective of parent location. Base salaries of SVP’s and below are for Commercial Banking business segments and do not cover other departments (Finance, Operations, IT, Human Resources, etc).
- VP-level salary averages reflect 10-15 years experience. Base salaries can be 10-30% more for 15 + years experience.
- N/A indicates insufficient sample size for reliable conclusions
Trends for the Commercial Banking Job Market in 2015
- Top performers have become harder to recruit which may slow job changes
Faster growing and/or better paying Banks exploited the chance to attract Bankers away from competitors in 2013-2014, resulting in numerous job changes. Given the cost of replacing talent, retention of key people has become a top priority. “Lock-up” stock packages, deferred compensation, and delayed bonus payouts increase the difficulty of recruiting top performers. Expectations of 20-30 % increases over current compensation are common for candidates approached about moving Banks. While demand for revenue-producing Management and RM’s still remains strong, Banks are already showing some reluctance to upset current pay or cost structures to attract highly compensated performers. As Banks focus more on ways to retain key people and less on enticing newcomers, this could slow new hiring to a degree. Nonetheless, some pockets of opportunity exist to hire “up and coming” professionals who may feel blocked by more senior people in their current institutions. Banks willing to give greater responsibility and compensation to those with more limited track records but strong potential could benefit greatly.
- Banks will continue to focus on niche market and fee income opportunities
As forecasted in our 2013 Compensation Survey, Banks seized on every chance to distinguish themselves in specialty markets such as Technology, Entertainment, Health Care, and Professional Services.
Those markets will expand further and Banks are likely to take on greater credit risks as they feel comfortable with their expertise in those areas. With increasing competition and margin compression on loans, Banks will keep augmenting fee-based business segments such as Investment Management, Treasury Management, Trade Services and Investment Banking.
- Mergers and acquisitions may have some nominal impact on the job market
Recent acquisitions of large California Banks such as City National and One West have not materially changed the job picture as both acquirers were non-California Banks. In fact, job-disruptive mergers on the scale of 2008-2009 or the 1990’s (Wells/First Interstate) are unlikely. However, mid and smaller size California Banks are still subject to in-market combinations (1st Enterprise/CUB, Bridge/Torrey Pines, etc.) Such events affect some senior management, corporate staff and regional managers. While jobs for client-facing RM’s are not usually eliminated, RM’s often depart on their own due to changes in management or credit culture.
- “Special expertise” will increasingly distinguish Commercial Banks and Bankers from one another
Over the past 3-4 years, Banks have aggressively staffed up their Middle Market and Business Banking segments. Not only do those type companies represent the vast majority of California’s business base but regulators have pushed Banks to greater “C & I” concentrations. With numerous Banks competing for the same markets the typical competitive edges of pricing, structure and service are getting blurred as well. As noted, niche market strategies and wider product offerings help some Banks demonstrate they aren’t just plain “vanilla” to customers. Bankers can distinguish themselves in three ways: 1 -niche-oriented career paths whether in a specific client industry, product segment or market 2 – developing greater expertise in risk analysis, complex financial structures and products and/or 3- good old fashioned relentless marketing.