NAB CEO Ross McEwan pockets $1.5m cash bonus, earns $5.29m for year

Ross McEwan boosts take-home pay with the help of a healthy cash bonus but ranks in third place when it comes to bank CEO compensation.

NAB CEO Ross McEwan was awarded $5.29m in total remuneration for 2021. Picture: Aaron Francis / The Australian

National Australia Bank chief executive Ross McEwan pocketed $5.29m in remuneration for 2021, as he added a healthy $1.5m cash bonus to his fixed salary.

NAB’s annual report, released on Tuesday, showed Mr McEwan, who joined the bank in December 2019 and led it through the Covid-19 crisis, was awarded $2.7m, or 121 per cent of his fixed salary, as his bonus for the year, with a little under half locked away as deferred rights.

The $2.7m bonus handed over to the veteran banker, which was 81 per cent of the maximum he could have received under the bank’s variable reward structure, was on top of his $2.5m take-home pay.

The rest of the executive team also took home bumper pay packets this year, achieving between 70 per cent and 99 per cent of the maximum allowed under the variable plan.

Mr McEwan’s 2021 pay is a big jump from what he received in 2020: the bank boss trousered $2.42m in remuneration last year, after taking a 20 per cent cut in his fixed pay in the September half-year due to the global pandemic. His 2020 remuneration also lacked any bonus.

While Mr McEwan received 81 per cent of his maximum bonus this year, his predecessor Andrew Thorburn was given no variable award in 2019 in the wake of the banking royal commission and was handed just 12 per cent of the maximum allowed in 2018 and 36 per cent in 2017.

With total remuneration of $5.29m for 2021, Mr McEwan ranks in third place among the big four bank bosses for compensation, though his fixed salary is the highest of the lot.

Over at Commonwealth Bank, Matt Comyn was handed $6.29m in total remuneration for 2021, compared with ANZ boss Shayne Elliott’s $5.47m. Westpac’s Peter King, meanwhile, moved to fourth place, with $4.2m in total remuneration for the year.

Remuneration committee chairman Anne Loveridge said in NAB’s annual report that Mr McEwan and the bank’s other top executives “demonstrated a momentum shift” in delivery against the lender’s strategy and business plan.

NAB’s cash profit climbed 76.8 per cent to $6.56bn for the 12 months ended September 30 from last year, the bank said on Tuesday. Excluding lumpy notable items, profit was up 38.6 per cent.

“The board spent a significant amount of time balancing customer, community, and shareholder interests, while at the same time appropriately recognising the achievements of the group CEO and group executives,” Ms Loveridge said.

“The board considered performance in 2021 demonstrated a momentum shift in delivery against the group’s strategy and business plan. The board is confident the group is well positioned to support economic recovery in Australia and New Zealand in 2022.”

The board was confident the remuneration framework was effective in rewarding sustainable performance and the execution of the group‘s strategy, Ms Loveridge said.

“The board will consider enhancements over the coming year to ensure the remuneration framework continues to support the delivery of the group‘s strategy and meet regulatory requirements.

“We will continue to balance these requirements with an effective remuneration framework that is competitive and appropriately rewards our group CEO and group executives.”

NAB’s shares finished Tuesday’s session down 0.76 per cent at $28.89. Its share price is up 36 per cent on this time last year.