Executive Compensation at the American Bankers Association (2019)
The American Bankers Association (ABA) is a non-profit 501 (c) (6) organization – “a business league that pushes advocacy, provides education, products, and solutions to its membership and the financial services industry.” In other words, the ABA is a tax-exempt association for banks, savings and loans, and trust companies. Based in Washington, DC the ABA engages in lobbying, works to establish banking standards, and educates the public and its members.
While some people think of non-profits as almost an afterthought, the ABA is anything but insignificant. The ABA raises more than $100 annually, typically spends less than it brings in, and has accumulated nearly $50 million in net assets (although net assets would be significant higher if not for a $35 million downward adjustment because of underfunded pension requirements).
In 2019, the ABA reported total revenue of $135 million (compared to $121 million in 2018), most of which came from dues ($47 million), royalties ($37 million), training ($16 million), gains and investment income ($15 million) and conferences ($13 million). Expenses totaled $120 million during the same period with the 4 largest expenses reported to be compensation ($70 million), fees for services ($18 million), office-related expenses ($12 million), and travel and conferences ($12 million). Although the ABA spent $15 million less than the organization collected, net assets decreased from $78 million to $47 million because of an underfunded pension/post-retirement benefits and unrealized losses on investments.
In 2019, 420 employees were compensated $70 million, which equates to an average compensation of $167,000. However, only 190 employees received more than $100,000 in compensation which means there were some very highly compensated people in ABA.
The 16 most highly compensated employees were compensated more than $16 million:
- $3,145,960: Rob Nichols, President and CEO
- $1,504,449: Wayne Abernathy, EVP
- $1,254,040: James Ballentine, EVP
- $1,211,935: Jeffrey Owen, Former COO
- $1,194,193: Jim Chessen, EVP
- $1,178,049: James G Edrington, EVP
- $1,162,218: Kenneth Clayton, EVP
- $1,042,585: Dawn Causey, General Counsel
- $1,035,857: Robert G Eady, CFO
- $ 661,123: Robert R Davis, EVP
- $ 516,750: Christine Walika, Former EVP
- $ 493,399: Robert Schmermund, EVP
- $ 462,818: Paul C Katz, EVP
- $ 547,449: Peter Cook, Chief Communication Officer
- $ 485,794: Alethia, Baggett, Chief HR Officer
- $ 401,200: Naomi Camper, Chief Policy Officer
As illustrated above, 12 of the 16 most highly compensated employees (75%) are male while 4 of the 16 (or 25%) are female.
The IRS Form 990 also reports the following information:
The ABA paid for first class travel. Certain officers of the organization (five in total) are allowed to fly first class and may bring a companion at their discretion.
The ABA pays for social club dues or initiation fees for business use.
The ABA provides a nonqualified supplemental employee retirement plan (SERP) and/or a supplemental life insurance plan with accrued present value benefits for the year:
- $378,600: James Ballentine
- $265,800: Robert Nichols
- $265,468: Wayne Abernathy
- $178764: Jim Chessen
- $162,379: Kennth Clayton
- $145,936: James Edrington
- $ 88,172: Robert Eady
- $ 50,000: Dawn Causey
- $ 20,000: Peter Cook
- $ 14,500: Alethia Baggett
- $ 4,325: Robert Davis
- $ 1,118: Robert Schmermund
- $ 500: Naomi Camper
A gross up of 12.25% of the taxable amount of the SERP is paid to the above executives.
The bottom line is that if you’re paying membership dues or fees to the ABA, a large portion of your money (about 70%) goes towards supporting the staff of the organization (including 16 well compensated employees), office-related expenses along with first class travel, companion travel, retirement benefits, gross up payments, and social club dues and/or initiation dues. The remainder of your dues/fees were primarily spent on consultants. 44 independent contractors received more than $100,000 in compensation with the five (5) most highly compensated reported to be consultants:
- $835,768: Something Else Strategies, of Easley, SC
- $793,745: Sapent Government Services, of Arlington, VA
- $755,107: Product Resource Group, of Washington, DC
- $749,500: Cogent Strategies, of Washington, DC
- $473,220: Amedia, of Bethesda, MD
To read the IRS Form 990 (2018 for the year ending August 30, 2019), click here.