CEO Demchak’s 2014 pay increases 42% as PNC’s stock soars
PNC Financial Services rewarded CEO Bill Demchak with a 42 percent pay increase in 2014 as the bank’s stock price outperformed its peers in a difficult year for lenders.
Demchak, 52, received $11.33 million in total compensation last year, up from $7.98 million in 2013 when he took over as CEO, according to a proxy statement filed with regulators Tuesday.
Under Demchak’s stewardship, the bank has pushed for aggressive expense cuts and transformed its retail business as banks struggled to make money from lending amid low interest rates.
Profits last year were flat with 2013 as PNC reported annual net income of $3.9 billion, and revenue fell 4 percent to $15.38 billion. But Demchak deserves credit for controlling costs and getting out ahead of digital banking trends, said Dan Werner, an analyst at Morningstar.
The bank slashed $500 million in costs in 2014, which included 48 branch closures, and converted 156 other locations to be more technology-focused and appeal to younger customers.
“The trends in banking, PNC is definitely addressing under his leadership, in terms of the digitization,” Werner said. “And I think that has been reflected in the stock price.”
PNC’s stock rose 20 percent in 2014 compared to 12 percent growth in the Standard & Poor’s 500 Index. The KBW Bank Index, which tracks the stocks of 24 banks including PNC, increased 7 percent. PNC’s stock has continued to climb in 2015 and closed Tuesday up 5 percent for the year to $95.82.
Demchak’s base salary increased 18 percent from $922,115 to $1.09 million in 2014, but a large part of the boost in total compensation was in stock. Demchak’s stock awards spiked 55 percent, from $3.86 million in 2013 to $6 million last year.
PNC will have its annual shareholders meeting Downtown on April 28.
Chris Fleisher is a staff writer for Trib Total Media. He can be reached at 412-320-7854 or email@example.com.