It is true that the very top bank executives make more in a year than most of us make in a lifetime, but compensation of this magnitude is rare. Most banks in this country are small businesses and pay employees modest salaries. The Bureau of Labor Statistics reports that the average annual salary of a bank employee was $49,540 in 2012, not much higher than the average annual across all occupations, $45,790.
Yet one group in banking stands out as highly paid — federal bank regulators. Before the Dodd-Frank Act, the average employee of a federal bank regulatory agency received 2.3 times the average compensation of a private banker. By 2013 this ratio increased to more than 2.7 — and in some cases considerably more.
The average compensation at the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corp. (FDIC) and the Consumer Financial Protection Bureau (CFPB) exceeded $190,000 in 2012. The staff at the Federal Reserve is likely even better compensated, but the Fed refuses to release employee salaries.
One group in banking stands out as highly paid! One group! FYI, the OCC has 3,898 full-time-equivalent employees, the FDIC has 7,199, the CFPB has 1,545, and the Fed has 21,311.(1) That’s a total of 33,953 employees of all the bank regulatory agencies, making their $190,000 salaries like entitled fat cats. As it happens, that one group is roughly the size of Goldman Sachs, whose 32,900 employees make an average of $383,000 a year. So, two groups in banking stand out as highly paid! Regulators and Goldman. Oh but Morgan Stanley’s 55,794 employees average $291,000 each. Three groups! I’ll stop there, though it’s pretty easy to find groups that make more than the regulators. (“Securities industry employees in New York” is a good one.)
Especially since that $190,000 number seems … wrong? These agencies release budgets, you know, even the sneaky sneaky Fed. Here are some average salaries computed from the budgets: (2)
So the average federal financial regulator makes somewhat less than a third-year investment banking analyst. (3)