Here's Why Shareholders Should Examine Southside Bancshares, Inc.'s (NASDAQ:SBSI) CEO Compensation Package More Closely
Key Insights
Southside Bancshares to hold its Annual General Meeting on 15th of May
Salary of US$809.6k is part of CEO Lee Gibson's total remuneration
Total compensation is similar to the industry average
Over the past three years, Southside Bancshares' EPS fell by 7.3% and over the past three years, the total loss to shareholders 24%
The results at Southside Bancshares, Inc. (NASDAQ:SBSI) have been quite disappointing recently and CEO Lee Gibson bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 15th of May. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.
View our latest analysis for Southside Bancshares
How Does Total Compensation For Lee Gibson Compare With Other Companies In The Industry?
Our data indicates that Southside Bancshares, Inc. has a market capitalization of US$834m, and total annual CEO compensation was reported as US$2.1m for the year to December 2023. That's a notable increase of 38% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$810k.
On comparing similar companies from the American Banks industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$1.9m. This suggests that Southside Bancshares remunerates its CEO largely in line with the industry average. Furthermore, Lee Gibson directly owns US$2.3m worth of shares in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$810k | US$775k | 38% |
Other | US$1.3m | US$775k | 62% |
Total Compensation | US$2.1m | US$1.5m | 100% |
On an industry level, roughly 45% of total compensation represents salary and 55% is other remuneration. In Southside Bancshares' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Southside Bancshares, Inc.'s Growth Numbers
Over the last three years, Southside Bancshares, Inc. has shrunk its earnings per share by 7.3% per year. Its revenue is down 6.5% over the previous year.
Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Southside Bancshares, Inc. Been A Good Investment?
With a three year total loss of 24% for the shareholders, Southside Bancshares, Inc. would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.
If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Southside Bancshares.
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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
