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Does Territorial Bancorp Inc.’s (NASDAQ:TBNK) CEO Salary Compare Well With Others?

Brandon Murphy

In 1986 Allan Kitagawa was appointed CEO of Territorial Bancorp Inc. (NASDAQ:TBNK). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Territorial Bancorp

How Does Allan Kitagawa’s Compensation Compare With Similar Sized Companies?

Our data indicates that Territorial Bancorp Inc. is worth US$247m, and total annual CEO compensation is US$1.9m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$851k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$958k.

It would therefore appear that Territorial Bancorp Inc. pays Allan Kitagawa more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

The graphic below shows how CEO compensation at Territorial Bancorp has changed from year to year.

NasdaqGS:TBNK CEO Compensation December 18th 18
NasdaqGS:TBNK CEO Compensation December 18th 18

Is Territorial Bancorp Inc. Growing?

On average over the last three years, Territorial Bancorp Inc. has grown earnings per share (EPS) by 2.7% each year. Its revenue is up 1.0% over last year.

I’d prefer higher revenue growth, but I’m happy with the modest EPS growth. So there are some positives here, but not enough to earn high praise.

Shareholders might be interested in this free visualization of analyst forecasts. .

Has Territorial Bancorp Inc. Been A Good Investment?

With a total shareholder return of 7.0% over three years, Territorial Bancorp Inc. has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary…

We compared the total CEO remuneration paid by Territorial Bancorp Inc., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. So it’s certainly hard to argue that the CEO is modestly paid, although we don’t see the remuneration as an issue. Whatever your view on compensation, you might want to check if insiders are buying or selling Territorial Bancorp shares (free trial).

Or you might prefer examine intently this intuitive graph showing past earnings and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.