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Fifth Third Raises CEO Carmichael's 2018 Compensation by 29%
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Fifth Third Bancorp’s (FITB - Free Report) chief executive officer (CEO) Greg D. Carmichael received a whopping 29% hike in his total compensation package for 2018 compared to the prior year. Carmichael’s total annual pay increased to $11.2 million in 2018 from $8.7 million, according to the company’s proxy statement.
The increase in his compensation was largely driven by more than 100% surge in non-equity incentive plan compensation to $4.1 million from $2 million in 2017, which is based on the company’s Variable Compensation Plan related to several metrics. Therefore, these metrics, including earnings per share, return on assets and efficiency ratio exceeded targets in 2018.
Moreover, the rise in his pay was also attributed to stock awards which jumped to $4.9 million from $4.5 million in the prior year. Further, the base salary increased 10% from the previous year to $1.1 million. His stock options were also up from $800,000 to $862,000 in 2018.
Carmichael joined Fifth Third in 2003, as the head of information technology and was promoted as the chief operating officer in 2006. By 2009, his responsibilities broadened and included leading the retail bank, business banking, and all affiliate banks and markets. In 2012, Carmichael was named president. Furthermore, succeeding the former CEO Kevin T. Kabat, Carmichael, took his position as CEO in November 2015.
Fifth Third, with a diversified traditional banking platform, remains well poised to benefit from a recovering economy, along with its Midwest footprints. With solid capital levels, further acquisition activities can be expected. Also, the approval of its 2018 Capital Plan, which includes share buyback up to $1.65 billion and intention to increase quarterly dividend by 33.3%, reflects the company’s commitment toward enhancing shareholders’ value.
Though Fifth Third was steadily active in deploying capital in 2018, investors’ concerns prevailed on certain macroeconomic factors. Therefore, the company's share price depreciated roughly 21% in the year, following a 14.7% rise in 2017.
Among other banking giants, Bank of America Corp.’s (BAC - Free Report) chairman and CEO — Brian Moynihan — is expected to receive $27 million as total compensation for 2018, which reflects a rise of 15% year over year. Among others, JPMorgan (JPM - Free Report) and Morgan Stanley (MS - Free Report) have also increased their CEOs’ compensation.
Notably, Fifth Third has improved on capital return to shareholders since the financial crisis, investment in core businesses and passed regulatory tests. Carmichael has also been adept in strategically evaluating various facets of the bank’s major businesses.
We believe Carmichael’s pay hike will prove to be a major morale booster. Fifth Third’s fundamentals remain highly promising with a diverse business model and a strong balance sheet.
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
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Fifth Third Raises CEO Carmichael's 2018 Compensation by 29%
Fifth Third Bancorp’s (FITB - Free Report) chief executive officer (CEO) Greg D. Carmichael received a whopping 29% hike in his total compensation package for 2018 compared to the prior year. Carmichael’s total annual pay increased to $11.2 million in 2018 from $8.7 million, according to the company’s proxy statement.
The increase in his compensation was largely driven by more than 100% surge in non-equity incentive plan compensation to $4.1 million from $2 million in 2017, which is based on the company’s Variable Compensation Plan related to several metrics. Therefore, these metrics, including earnings per share, return on assets and efficiency ratio exceeded targets in 2018.
Moreover, the rise in his pay was also attributed to stock awards which jumped to $4.9 million from $4.5 million in the prior year. Further, the base salary increased 10% from the previous year to $1.1 million. His stock options were also up from $800,000 to $862,000 in 2018.
Carmichael joined Fifth Third in 2003, as the head of information technology and was promoted as the chief operating officer in 2006. By 2009, his responsibilities broadened and included leading the retail bank, business banking, and all affiliate banks and markets. In 2012, Carmichael was named president. Furthermore, succeeding the former CEO Kevin T. Kabat, Carmichael, took his position as CEO in November 2015.
Fifth Third, with a diversified traditional banking platform, remains well poised to benefit from a recovering economy, along with its Midwest footprints. With solid capital levels, further acquisition activities can be expected. Also, the approval of its 2018 Capital Plan, which includes share buyback up to $1.65 billion and intention to increase quarterly dividend by 33.3%, reflects the company’s commitment toward enhancing shareholders’ value.
Though Fifth Third was steadily active in deploying capital in 2018, investors’ concerns prevailed on certain macroeconomic factors. Therefore, the company's share price depreciated roughly 21% in the year, following a 14.7% rise in 2017.
Among other banking giants, Bank of America Corp.’s (BAC - Free Report) chairman and CEO — Brian Moynihan — is expected to receive $27 million as total compensation for 2018, which reflects a rise of 15% year over year. Among others, JPMorgan (JPM - Free Report) and Morgan Stanley (MS - Free Report) have also increased their CEOs’ compensation.
Notably, Fifth Third has improved on capital return to shareholders since the financial crisis, investment in core businesses and passed regulatory tests. Carmichael has also been adept in strategically evaluating various facets of the bank’s major businesses.
We believe Carmichael’s pay hike will prove to be a major morale booster. Fifth Third’s fundamentals remain highly promising with a diverse business model and a strong balance sheet.
Currently, Fifth Third holds a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
See Stocks Today >>