The Determinants of CEO Compensation in the Banking Sector: A Comparison of the Influence of Cross-Listing and Loan Growth in Developed Versus Developing Countries

Ben Le (), Nischala Reddy and Paula Hearn Moore
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Ben Le: Department of Accounting Economics and Finance, University of Tennessee at Martin, Martin, TN 38237, USA
Nischala Reddy: Department of Economics and Finance, University of Central Missouri, Warrensburg, MO 64093, USA
Paula Hearn Moore: Department of Accounting Economics and Finance, University of Tennessee at Martin, Martin, TN 38237, USA

JRFM, 2025, vol. 18, issue 3, 1-17

Abstract: This study explores the determinants of CEO compensation in the banking sector, focusing on cross-listing and loan growth. Using 8800 observations from 45 countries spanning 2004 to 2018, the analysis reveals significant differences in compensation structures between developed and developing economies. The findings show that CEO stock options and restricted stock compensation are positively correlated with cross-listing in the U.S. market, with a stronger effect in developing countries. Loan growth is associated with higher incentive-based pay but lower fixed salaries, aligning CEO compensation with performance-driven growth and risk management. These results underscore the role of regulatory environments and institutional quality in shaping executive pay, offering valuable insights for policymakers, financial institutions, and investors navigating a globalized banking sector.

Keywords: CEO compensation; developing markets; cross-listing; loan growth; banks (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2025
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