These 10 wealth management giants paid CEOs an average $24M in 2022

May 5, 2023 2:41 PM

Five of the 10 largest publicly traded wealth management firms gave their CEOs double-digit raises last year.

As shown by the ranking below of the biggest compensation among industry CEOs, Morgan Stanley's James Gorman unseated JPMorgan Chase's Jamie Dimon as the most generously paid head executive in the industry in 2022. The loss last year of a "one-time special award" of $56 million that Dimon received in 2021 resulted in him sustaining the biggest hit to his paycheck among the group.

On the plus side, Raymond James CEO Paul Reilly and Bank of America CEO Brian Moynihan, whose firm owns Merrill, raked in the largest pay increases.

"If the CEO is adding a lot of shareholder value through decisions that he or she is making that result in a high return to shareholders, then boards are going to want to make sure that they are rewarding that individual appropriately to make sure that there's an alignment," Ed Steinhoff, a managing director of executive compensation consulting firm Pearl Meyer, said in an interview.

The "pretty average year" in CEO pay last year led to compensation packages that "were around target levels of pay based on target levels of performance," said Steinhoff, who counts financial firms as half his client base. This year looks like a different matter for financial firms, considering the bank failures of March and JPMorgan's takeover of First Republic this week.

"I think we're going to see a lot of cases where we get to the end of the year and performance is going to be lower than what we expected," Steinhoff said, noting that stock units comprise a significant portion of CEO compensation. "The value of that stock has declined. … The value is not going to be anywhere near what the intended value was at the beginning of the year."

For a look at the CEO pay at 10 of the largest firms in wealth management, scroll down the slideshow. To see what the same firms paid their head executive in 2021, click here.

Note: Each of the firms shared executive pay in their 2023 proxy statements or 2022 annual reports. Total compensation in standardized tables required by the SEC for a company's named executive officers may vary from a firm's "direct compensation" to its CEO or other measures disclosed in annual documents. The calculations depend on the current value of stock units, the timing of vesting or exercising of options and other factors. For example, one firm below disclosed lower direct pay for a CEO in 2022 but listed a higher amount in total compensation.

10. UBS

CEO: Ralph Hamers
2022 total compensation: $13,113,755
2021: $12,562,444
2022 vs. 2021: $551,311 (increase of 4%)

Remark: "The [board] recognized that Ralph Hamers successfully led UBS through a challenging year and delivered good financial results despite significant headwinds due to geopolitical and macroeconomic developments," according to the firm's annual report. "In this environment, he focused the firm on maintaining client momentum and the disciplined execution of our strategy across regions to deliver the benefits of our geographic diversification."

*As a foreign company, the wirehouse's parent doesn't file annual proxy statements with the SEC that include the same information available about other publicly traded firms.

9. LPL Financial

CEO: Dan Arnold
2022 total compensation: $13,750,390
2021: $12,875,868
2022 vs. 2021: $874,522 (increase of 7%)

Other notable executive compensation: Rich Steinmeier, divisional president of business development: ($3,313,614); Kabir Sethi, chief product officer ($3,937,416)

Median annual total compensation of all employees (other than CEO): $94,063
CEO pay ratio: 146 to 1

Remark: "The Compensation Committee determined that the company's financial performance for 2022 exceeded target goals and the collective level of achievement of the 2022 [objectives and key results] partially met target," according to the firm's proxy statement. "As a result, the 2022 bonus pool was funded above target level and the annual cash bonus awards to our [named executive officers] (as well as to our other executive officers and employees) were generally paid at target level, or above target level for high performing employees, including our [named executive officers]. This approach is consistent with our compensation philosophy and past practice."

8. Raymond James

CEO: Paul Reilly
2022 total compensation: $18,059,116
2021: $13,901,046
2022 vs. 2021: $4,158,070 (increase of 30%)

Other notable executive compensation: Scott Curtis, president of the Private Client Group ( $4,669,804); Tash Elwyn, CEO of Raymond James & Associates ($4,668,891)

Median annual total compensation of all employees (other than CEO): $114,022
CEO pay ratio: 158 to 1

Remark: "At the start of each fiscal year, following recommendation by our chair and CEO, each executive officer establishes key business goals and priorities, and aligns these goals to our Raymond James Core Values: client first, conservatism, independence and integrity," according to the firm's proxy statement. "The key business goals include the following areas of focus: financial achievement, business growth, operational efficiency and general management. The committee reviews and approves goals and performance priorities. The committee does not utilize formulaic financial performance goals or targets, and performance metrics are not assigned any specific weighting for purposes of determining the compensation awarded to the CEO or other [named executive officers]."

7. Edward Jones

CEO: Penny Pennington
2022 total compensation: $21,437,004
2021: $22,567,837
2022 vs. 2021: -$1,130,833 (decrease of 5%)

Other notable executive compensation: Kenneth Cella, head of branch development ($18,495,139)

Median annual total compensation of all employees (other than CEO): $91,384
CEO pay ratio: 235 to 1

Remark: "By owning general partnership interests, [executive leadership team] members are encouraged to balance short-term and long-term results of the partnership as they have a significant amount of capital at risk," according to the firm's annual report. "Also, by sharing in any annual operating loss of the partnership, all general partners, including [executive leadership team] members, have a direct incentive to manage risk and focus on the short- and long-term financial results of the partnership."

6. Ameriprise

CEO: Jim Cracchiolo
2022 total compensation: $22,847,623
2021: $21,229,464
2022 vs. 2021: $1,618,159 (increase of 8%)

Other notable executive compensation: Joseph Sweeney, president of advice and wealth management products and service delivery ($4,863,917)

Median annual total compensation of all employees (other than CEO): $125,033
CEO pay ratio: 183 to 1

Remark: "Led by Mr. Cracchiolo, our executive team delivered outstanding results in a volatile and challenging year," according to the firm's proxy statement. "The annual cash and long-term awards provided to them reflect their consistency and ability to deliver exceptional performance for our stakeholders, including our shareholders. Both the annual and long-term awards provided to Mr. Cracchiolo and other [named executive officers] were calculated (on the company's 1–5-point rating scale) based on results achieved and according to the pre-established metrics and target level of performance for each financial and strategic business goal. Both the annual incentive awards and long-term incentive awards are within target ranges determined by the Compensation and Benefits Committee."

5. Charles Schwab

CEO: Walt Bettinger
2022 total compensation: $24,386,329
2021: $21,938,404
2022 vs. 2021: $2,447,925 (increase of 11%)

Other notable executive compensation: Charles Schwab, co-chairman ($7,902,434)

Median annual total compensation of all employees (other than CEO): $116,203
CEO pay ratio: 210 to 1

Remark: "Base salary, annual cash incentives and [long-term incentives] are the compensation elements used to motivate executives to achieve the company's objectives," according to the firm's proxy statement. "In addition to the factors enumerated in the decision-making process above, the Compensation Committee considered the increase in the company's size, scope, and complexity following recent acquisitions in setting the base salary, annual cash incentives, and [long-term incentives] for the [named executive officers] for 2022."

4. Wells Fargo

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CEO: Charlie Scharf
2022 total compensation: $24,642,526
2021: $21,350,906
2022 vs. 2021: $3,291,620 (increase of 13%)

Median annual total compensation of all employees (other than CEO): $75,979
CEO pay ratio: 324 to 1

Remark: "The company continued to make progress in transforming our business, while strengthening our risk and control infrastructure, resolving legacy regulatory matters, investing for the future, engaging with our customers and rebuilding their trust, and demonstrating and reinforcing our commitments to our employees, communities, and other stakeholders," according to Wells Fargo's proxy statement.

3. Bank of America

CEO: Brian Moynihan
2022 total compensation: $30,177,503
2021: $23,729,169
2022 vs. 2021: $6,448,334 (increase of 27%)

Median annual total compensation of all employees (other than CEO): $117,040
CEO pay ratio: 258 to 1

Remark: "Our compensation and human capital committee determines the pay for our named executive officers for each performance year," according to the firm's proxy statement. "Our pay-for-performance structure is designed to emphasize variable pay and help motivate our executives to deliver sustained shareholder value and responsible growth."

2. JPMorgan Chase

Close up of signage stands on display outside the JPMorgan & Chase Tower in downtown Chicago, Oct. 7, 2017

CEO: Jamie Dimon
2022 total compensation: $34,848,606
2021: $84,428,145
2022 vs. 2021: -$49,579,539 (decrease of 59%)

Median annual total compensation of all employees (other than CEO): $88,730
CEO pay ratio: 393 to 1

Remark: "The firm continued to build upon its strong momentum from prior years amid challenging market conditions, reflecting the diversity and durability of our products and services, as well as long-term strategic investments made in our businesses," according to the company's proxy statement. "We gained market share in our businesses, demonstrated strong expense discipline while continuing to invest into our businesses, continued to achieve high customer satisfaction scores, and maintained a fortress balance sheet."

1. Morgan Stanley

CEO: James Gorman
2022 total compensation: $39,398,905
2021: $34,941,635
2022 vs. 2021: $4,457,270 (increase of 13%)

Other notable executive compensation: Andy Saperstein, head of wealth management ($22,711,116)

Median annual total compensation of all employees (other than CEO): $143,794
CEO pay ratio: 274 to 1

Remark: "The 2022 pay decision for the CEO was made by the CMDS Committee, in consultation with the board, following its assessment of Mr. Gorman's outstanding individual performance and solid company financial performance, including demonstrated resilience to adverse markets, allowing for growth and sustainable capital return," according to the firm's proxy statement.