What's driving banks' low say-on-pay vote tallies

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A handful of U.S. banks are facing heightened shareholder dissatisfaction over executive pay, pressuring them either to further defend their compensation programs or make changes.

In recent weeks, the say-on-pay resolutions presented by Bank of America , Truist Financial and Citizens Financial Group were approved at each company's annual meeting, but with noticeably less shareholder support compared with last year.

At Texas Capital Bancshares, the say-on-pay measure failed, as less than 50% of shareholders showed support. The 47% to 53% vote came in spite of the bank's efforts last fall to address investors' concerns about one-time equity awards to certain named executives and an amended employment contract for Chairman and CEO Rob Holmes.

Goldman Sachs' shareholders also recently registered a steep decline in support for executive compensation. The Wall Street giant's say-on-pay measure garnered 66% support during its annual meeting in late April — a 20-percentage-point drop from Goldman's final tally last year.

At all five banks, at least one proxy advisory firm recommended a "no" vote for executive compensation. Such recommendations can have a big impact on shareholder vote tallies, experts said.

Banks that receive dwindling support will want to get to work on talking to investors and making the case that what they pay their CEO and the rest of the C-suite is worth it, Alan Johnson, managing director at Johnson Associates, a compensation consulting firm that works with some of the nation's largest banks, told American Banker. And they should move fast or risk losing more support next year, he added.

"You're going to take a really serious look at your program, especially if you've failed the vote or gotten really close, and you're going to have to make some changes," Johnson said. The reason for the lower support is sometimes "pretty straightforward, and sometimes it's more arbitrary," he said.

Banks' say-on-pay proposals are nonbinding, which means that even if the measure loses support in a given year, boards aren't required to make changes to future pay programs.

But sometimes they do. In 2022, shareholders overwhelmingly disapproved of JPMorganChase CEO Jamie Dimon's prior-year compensation, which included a one-time bonus of $52.6 million in stock options. The next year, the bank said it would not grant future special awards to Dimon.

The dissatisfaction over certain banks' 2024 executive compensation packages isn't surprising.

Last year, Goldman, Truist, Citizens and Texas Capital all granted special, off-cycle bonuses to top executives — moves that have historically elicited criticism from shareholders, analysts and proxy advisory firms.

The two largest advisory firms, Institutional Shareholder Services and Glass Lewis, made "no" recommendations for the pay packages at Goldman, Citizens and Texas Capital, citing concerns such as bonus size, the structure of the awards and a pay-for-performance gap. Truist got support from Glass Lewis, but opposition from ISS.

KeyCorp, which also granted special, off-cycle awards last year to named executives, is next in line. Both ISS and Glass Lewis are recommending a "no" vote when shareholders file their ballots at the company's May 15 annual meeting. Last year, more than 90% of shareholders voted in favor of Key's 2023 compensation program.

Banks with lower say-on-pay support this year aren't saying much publicly about how they plan to proceed.

At Dallas-based Texas Capital, the say-on-pay measure received just 47% shareholder approval at the company's annual meeting last month. That was down significantly from 83% approval last year, and it followed shareholder outreach by the company's board last fall. In its 2025 proxy statement, Texas Capital said it met with investors to get feedback on the 2024 say-on-pay tally and heard concerns about the special equity awards and Holmes' favorably amended employment deal.

In a statement to American Banker, the $31.4 billion-asset company, which is in the fourth year of a four-year strategy overhaul led by Holmes, said it "believes its executive compensation programs align the interests of its named executive officers, broader workforce and stockholders by combining performance-based cash and equity incentives with competitive base pay."

Texas Capital also said that its "historic transformation" stems from "management's execution of a multi-year strategy that repositioned the firm as a diversified, tech-forward financial institution with strengthened performance, governance, and long-term potential." It will "continue to actively engage" with investors to hear their concerns and "ensure we deliver shareholder value."

Under Holmes, who joined Texas Capital as CEO in 2021, the company has met some of the financial targets it set that year. It continues to work on others, including certain revenue and capital-ratio goals. Some analysts have wondered if the bank will be able to meet those goals by year-end, in part because the current economic uncertainty could derail investment banking activity.

Meanwhile, this year's say-on-pay resolutions passed at Truist and Citizens Financial, but the margins at both banks were much more narrow than in the prior year. Truist's proposal, which got 88% approval in 2024, received slightly more than 59% support this year.

The $535.9 billion-asset Truist declined to comment on the results or what it plans to do to engage with shareholders.

Last year, Truist provided leadership retention awards to Chief Financial Officer Mike Maguire and Dontá Wilson, its chief consumer and small-business banking officer, worth $4.5 million apiece.

Compensation

Goldman shareholders OK executive pay but with less support

The Wall Street giant's say-on-pay resolution garnered 66% support, down from 86% last year. Other banks' pay packages are also facing opposition from proxy advisory firms.

By Kevin Wack

April 23

In its latest proxy statement, the Charlotte, North Carolina-based company said that shareholders "provided helpful feedback and views" on topics such as executive compensation and the retention awards and, as a result, it "enhanced disclosures" around pay packages and special awards.

Citizens' say-on-pay measure, which received only 63% approval last year, fell to 59% this year. The Providence, Rhode Island-based bank declined to comment on this year's results, its engagement strategy or its policies.

According to Citizens' 2025 proxy statement, the $220.1 billion-asset company continued its "longstanding annual shareholder outreach program" and heard that shareholders wanted "additional structure around the determination of executive compensation," as well as more details about how compensation is decided. As a result of those conversations, the bank "made changes" to the process used for determining pay for named executives and enhanced disclosures, it said.

Bank of America's say-on-pay resolution received higher approval this year than the other banks discussed in this article — 74%, which was down from 91% last year — and it is the only one of the banks that didn't grant special awards in 2024. ISS recommended a "no" vote due to the structure and disclosures of the company's short-term incentive determination plan, but did not take issue with the alignment of the bank's performance with executive compensation. Glass Lewis recommended a "yes" vote.

Bank of America declined to comment on this year's tally.

It's too early in banks' annual-meeting season to say if there will be an uptick in the number of banks that lose shareholder support for their pay-on-say measures, according to Laura Hay, a partner at Meridian Compensation Partners. She cautioned that "we're not done with the season yet."

ISS expects banks with less than 70% say-on-pay approval to conduct shareholders outreach to better understand their concerns. Glass Lewis expects outreach when approval is below 80%.

"I think what you might see with some of these banks is they'll strategize a little bit," so that low say-on-pay results don't become an ongoing issue, Hay said. "Some of them will tend to be more conservative in the next year so they can get the vote back up around 90% or above."