Key Insights

• Hong Leong Finance's Annual General Meeting to take place on 25th of April
• CEO Leng Beng Kwek's total compensation includes salary of S$1.13m
• The overall pay is 309% above the industry average
• Hong Leong Finance's EPS grew by 13% over the past three years while total shareholder return over the past three years was 16%

Performance at Hong Leong Finance Limited (SGX:S41) has been reasonably good and CEO Leng Beng Kwek has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 25th of April, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.

Comparing Hong Leong Finance Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Hong Leong Finance Limited has a market capitalization of S$1.1b, and reported total annual CEO compensation of S$3.0m for the year to December 2023. That's mostly flat as compared to the prior year's compensation. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at S$1.1m.

For comparison, other companies in the Singapore Consumer Finance industry with market capitalizations ranging between S$545m and S$2.2b had a median total CEO compensation of S$727k. Accordingly, our analysis reveals that Hong Leong Finance Limited pays Leng Beng Kwek north of the industry median. Moreover, Leng Beng Kwek also holds S$17m worth of Hong Leong Finance stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 89% of total compensation out of all the companies we analyzed, while other remuneration made up 11% of the pie. Hong Leong Finance pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Hong Leong Finance Limited's Growth Numbers

Hong Leong Finance Limited has seen its earnings per share (EPS) increase by 13% a year over the past three years. It saw its revenue drop 15% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Hong Leong Finance Limited Been A Good Investment?

Hong Leong Finance Limited has served shareholders reasonably well, with a total return of 16% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Hong Leong Finance that investors should be aware of in a dynamic business environment.

Switching gears from Hong Leong Finance, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.