In March 2023, Standard Bank published its integrated financial report for 2022, which included details of the salaries of its top executives. Despite facing challenging conditions in the country, the bank reported sustainable earnings growth and improved returns as reported by Business Tech. Total income rose by 18% to R156.92 billion, up from R132.72 billion in 2021, while headline earnings per share increased by 33% to 2,087.1 cents (2021: 1,573). The return on equity (ROE) also improved to 16.4% (FY21: 13.5%), and the group ended the year with a common equity tier 1 ratio of 13.5% (31 December 2021: 13.8%).
Standard Bank’s board approved a final dividend of 691 cents per share, representing a final dividend payout ratio of 60%. However, staff costs increased by 12% due to annual salary increases, increased skilled staff, and higher incentive accruals aligned to performance. Information technology costs increased by 13% due to higher spending on cloud migration and software licenses.
Looking ahead, the bank noted that its challenges are not expected to ease. While inflation is expected to moderate to 5.9% in the coming year, weak economic performance and the country’s graylisting by the Financial Action Task Force (FATF) pose challenges. Additionally, load shedding and the power crisis continue to be significant challenges to South Africa’s outlook.
Regarding executive pay, Standard Bank’s CEO, Sim Tshabalala, received a total package of R55.69 million, representing a 12.7% increase from the R49.38 million he received in pre-Covid 2019. This includes his fixed salary of R10.5 million, a cash incentive of R8.65 million, a deferred award of R10.65 million, and a performance award of R25.8 million. The bank’s CFO, Arno Daehnke, received R43.8 million for the year, a 25% increase from the R35 million he received in 2019. All but one of Standard Bank’s top seven executives received a total package of over R30 million for the year, with the group executive, David Munro, taking the ‘smallest’ amount among the executives at R27.47 million.
The six executives received a total of R293 million in salaries, averaging R41.8 million per executive. Based on Standard Bank’s reported numbers, the group spent R26.58 billion on staff costs in 2022 for its 28,870 employees (including salaries and benefits). This translates to around R920,000 per employee. The average executive salary was 45 times higher than the average employee’s, with the CEO earning 60 times more.