Capitec CEO Gerrie Fourie scores a massive R57 million payday

Capitec has been one of the biggest growth and success stories in the South African banking sector – and chief executive Gerrie Fourie’s salary reflects this.

In its most recent results, the bank reported an 18% rise in headline earnings to R4.5 billion for the year ended February 2018, while generating a return of 27% on its shareholders’ equity.

Diluted headline earnings per share increased 18% to R38.46, while the directors declared a final gross dividend of 945 cents per ordinary share, bringing the total dividends for the year to R14.70 per share.

Net transaction fee income (non-lending) increased from R3.9 billion to R5.1 billion in 2018, and now makes up 41% of total net income, due to an increase in transaction volumes. Income from operations climbed 13% to R17.8 billion, while operating costs increased by 17% to R6.4 billion.

Notably, the group’s active clients rose 15% to 9.868 million, from 8.569 million before, while the group opened 30 new branches over the period, to 826.

Group CEO Gerrie Fourie received a R56.6 million payout, thanks mainly due to a long-term incentive (LTI), along with a 10% increase in his basic pay package.

According to Capitec, the group’s year-on-year growth in HEPS of 18% was above the 15% target, which translated to a short-term incentive (STI) payment of 36.7% of the approved total guaranteed packaged (TGP) for the 2018 financial year.

For the LTI, the number was a split between the share options taken and the stock appreciation rights (SARs) vesting in the financial year.

Fourie’s salary was made up of a R10.75 million guaranteed package, R240,000 in other benefits, a R4.05 million short-term bonus, and a long-term incentive payout of R41.6 million.

Capitec CFO, Andre du Plessis was also rewarded for the group’s performance, with his complete remuneration package for the year amounting to R41.6 million – also thanks to a R30.2 million LTI payout.

In comparison, Nedbank CEO Mike Brown took home a R38 million for the full year, while Absa CEO Maria Ramos received a R37 million salary. Standard Bank CEO Sim Tshabalala earned R48.5 million.

Executive directors

Non-executive directors

Long-term incentives

Average salaries

In total, Capitec paid out R300.5 million to its strategic managers (12 managers), R240.3 million to senior management (102 managers) and R2.7 billion to other employees (13,219).

These averages are laid out in the table below, including both fixed cash and variable remuneration.

Group Total employees Total paid Average per employee
Strategic management 12 R300 576 000 R25 048 000
Senior managment 102 R240 337 000 R2 356 245
Other employees 13 219 R2 701 168 000 R204 340
Total 13 333 R3 242 081 000 R243 162

Read: Does Ramaphosa deserve a R3.6 million salary?

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Capitec CEO Gerrie Fourie scores a massive R57 million payday