WASHINGTON—In 2016, chief executive compensation at state-chartered credit unions was on average 13.12 times the average employee salary and benefits in 2016, according to a new report that suggests that ratio is actually understated.
The median ratio of chief executive compensation to average employee salary and benefits was 10.22, reported Keith Leggett, the former senior vice president and senior economist at the ABA.
Leggett explained that to calculate average credit union employee compensation, his analysis divided the call report line item Employee Compensation & Benefits by Full Time Equivalent Employees. Full Time Equivalent Employees = The Number of Full Time Employees + (0.5 times the Number of Part Time Employees), Leggett explained.
In this case, a large state-chartered credit union is defined as having at least $1 billion in assets, according to Leggett.
Premier America Credit Union, Chatsworth, Calif., reported the highest ratio of CEO pay to average employee pay at 79.41. The next highest ratio was 66.11 for OnPoint Community Credit Union in Portland, Ore. Financial Partners CU in Downey, Calif., (58.62); Municipal CU in New York (52.23) and San Diego County CU in San Diego (42.49) round out the top five.
“However, this comparison is not comparable to data being reported by publicly traded companies, which compares CEO pay to median employee pay. It is likely that the ratio for chief executive compensation to average employee pay for large state chartered credit unions is understated, because the analysis uses average employee pay, as median employee pay is not available. The median of employee compensation will be typically lower than the average employee compensation,” said Leggett.