Associations Dig Deep to Reward Their Leaders
The kings of the financial services industry's trade associations are being compensated royally.
Nine of 20 trade groups pay their top man more than $300,000, according to reporting by the American Banker as part of the paper's annual analysis of association finances.
Keeping his crown as highest-paid executive for the second year is Edward I. O'Brien, president of the Securities Industry Association. With a 13.6% pay raise, Mr. O'Brien made $582,291 in 1989.
David Silver, president of the Investment Company Institute, was the next-best-paid trade group head, at $514,884 in 1989 - a 14.4% hike in salary.
Average Raise Was 70%
The American Banker Association's executive vice president Donald G. Ogilvie came in third in the salary sweepstakes, at $427,698 in 1989. His earnings were down 6.7% from the year before because deferred compensation from earlier years bloated his 1988 salary.
All told, the top men at the 20 trade groups surveyed pulled in $5.5 million. The average trade association leader makes $275,000 - 7% more than the average of $257,000 reported last year.
The average pay raise for association executives was 16.5%, a figure skewed by the reported 49% pay raise taken by Lud Ashley, who runs the Association of Bank Holding Companies. Mr. Ashley, who made $341,997 in 1989, explained the figure looks big only because the group reported his salary plus bonus in 1989. In 1988, the group had reported only his base salary of $230,000. Mr. Ashley said his actual pay raise for 1989 hovered around the cost of living.
Patrick Forte, president on the Association of Financial Services Holding Companies, balanced the scale, however. His 1989 salary was slashed 16% to $145,000. In 1988, Mr. Forte received the biggest pay raise: 64%.
But again, the numbers are deceptive. Mr. Forte said he got a big bonus in 1988 for successful lobbying work on the thrift-bailout law. He did not get the same bonus in 1989.
This is the American Banker's third annual analysis of the finances of the trade associations representing financial services companies.
This year, American Banker looked at 20 associations. The groups polled represent investment and commercial banks, thrifts, credit unions, mutual funds brokers, real estate agents, insurance agents, and home builders.
The information in this story is the most current available, and in most cases reflects what happened in 1990.
By law, nonprofit it groups must tell the Internal Revenue Service how much money they took in, from where, and how those funds were spent. The information is listed on the IRS's form 990, and must be released to the public.
But because many groups, especially the larger ones, request repeated extensions of their deadlines, some of the information dates to 1989. Another problem is that the groups pick and choose which lines to fill in on the 990 report, leaving out crucial information.