Advanced search

Bank CEO Salaries: The Relation Between Performance, Ownership Concentration, and CEO Tenure

Vadhindran K. Rao (Graduate Student)
James E. McIntyre, Jr. (Assistant Professor of Finance, Department of Economics and Finance, School of Business, University of Mississippi, University, MS 38677)

Managerial Finance

ISSN: 0307-4358

Publication date: 1 June 1993

Abstract

We examine whether Douglas and Santerre's (1990) substitutes hypothesis obtains for bank holding companies (BHCs); i.e. whether degree of ownership concentration and salary incentives are alternative methods of aligning BHC CEO incentives with those of shareholders. Also examined is the relation between CEO salary and bonus and CEO tenure. Using a sample of 95 BHC drawn from the 1990 Forbes magazine compensation survey, we regress CEO salary and bonus against ROE, stock return, two measures of ownership concentration, and a CEO tenure variable. Our results 1) support the substitutes hypothesis as applied to BHCs, and, 2) find a negative relation between CEO salary and bonus and CEO tenure.

Citation

Rao, V. and McIntyre, J. (1993), "Bank CEO Salaries: The Relation Between Performance, Ownership Concentration, and CEO Tenure", Managerial Finance, Vol. 19 No. 6, pp. 9-17. https://doi.org/10.1108/eb013726

Download as .RIS

Publisher

:

MCB UP Ltd

Copyright © 1993, MCB UP Limited

Please note you might not have access to this content

You may be able to access this content by login via Shibboleth, Open Athens or with your Emerald account.
To rent this content from Deepdyve, please click the button.
Rent from Deepdyve
If you think you should have access to this content, click the button to contact our support team.
Contact us

We’re listening — tell us what you think

Join us on our journey