Walter S. Berman
AMERIPRISE FINANCIALAbout Walter S. Berman
Walter S. Berman is Executive Vice President and Chief Financial Officer of Ameriprise Financial, serving as CFO since the 2005 spin-off; he previously served as EVP & CFO of American Express Financial Corporation (AEFC) starting in January 2003 and Corporate Treasurer of American Express from April 2001 to January 2004. He is 82 years old. Under his financial leadership, Ameriprise reported record operating performance in 2024 and returned $2.8B to shareholders (~80% of adjusted operating earnings), with total shareholder return (TSR) of 42% in 2024, materially above proxy peers.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Ameriprise Financial (formerly AEFC under American Express) | EVP & CFO, AEFC | Jan 2003–Sep 2005 | Led finance during transition pre-spin; stepped into CFO role for spin-off parent in 2005 |
| American Express | Corporate Treasurer | Apr 2001–Jan 2004 | Oversaw corporate treasury; capital markets and liquidity leadership |
| Ameriprise Financial | EVP & CFO | Sep 2005–Present | Principal financial officer since spin-off, stewarding balance sheet, ERM, and investor communications |
Fixed Compensation
| Year | Base Salary ($) | Notes |
|---|---|---|
| 2024 | 675,000 | As disclosed in supplemental total direct compensation and SCT for NEOs |
| 2023 | 675,000 | |
| 2022 | 675,000 |
Performance Compensation
Annual Incentive (AIA) Structure and Payouts
- Structure: 70% Financial Performance (aligned to five core shareholder measures) and 30% Business & Strategic Performance; individual awards leverage 0–175% based on ratings against plan; Committee can adjust for market/interest rate variances and unique items within set rules.
- 2024 Achievements cited for Berman: record net revenues, earnings, EPS, operating margin; $2.8B returned to shareholders (~80% of adjusted operating earnings); 42% TSR in 2024.
| Year | AIA Weighting | Actual Annual Cash Incentive ($) |
|---|---|---|
| 2024 | 70% Financial / 30% Business & Strategic | 3,325,000 |
| 2023 | 70% Financial / 30% Business & Strategic | 3,230,000 |
| 2022 | 70% Financial / 30% Business & Strategic | 3,088,000 |
Long‑Term Incentives (LTI) – Grant Mix, Metrics, and Vesting
- 2024 grants (granted Jan 26, 2024 for 2023 performance): PSUs (target 5,748; grant value $2,250,000), RSUs (3,104; $1,215,000), Stock Options (9,169 at $391.40; Black‑Scholes value $1,035,000). Options/RSUs vest ratably over 3 years; PSUs cliff‑vest after 3 years.
- PSU metrics and payout (2022–2024 cycle, paid Feb 2025): Average ROE and EPS CAGR determine 0–150% payout; TSR modifier ±25 pts vs S&P 500 Financials. Actual 2022–2024 performance: ROE 49.7% and EPS CAGR 15.9% → 150%, plus +25% TSR modifier (TSR rank 4/60) → total 175%.
| LTI Type | Metric/Terms | 2024 Grant (effective 1/26/24) | Vesting | Payout Mechanics |
|---|---|---|---|---|
| PSUs | ROE, EPS CAGR; TSR modifier ±25 pts vs S&P 500 Financials | 5,748 target; $2,250,000 grant value | 3‑year cliff | 0–150% by ROE/EPS; ±TSR modifier; 2022–24 paid at 175% |
| RSUs | Time‑based | 3,104; $1,215,000 | 1/3 per year over 3 years | Shares delivered net of taxes |
| Stock Options | Time‑based | 9,169 @ $391.40; $1,035,000 | 1/3 per year over 3 years | 10‑year term; value only if price > strike |
Multi‑Year Total Direct Compensation (Committee View)
| Year | Salary ($) | Annual Cash Incentive ($) | Long‑Term Incentive Awards ($) | Total Direct Compensation ($) |
|---|---|---|---|---|
| 2024 | 675,000 | 3,325,000 | 5,000,000 | 9,000,000 |
| 2023 | 675,000 | 3,230,000 | 4,500,000 | 8,405,000 |
| 2022 | 675,000 | 3,088,000 | 4,500,000 | 8,263,000 |
Equity Ownership & Alignment
- Ownership and rights within 60 days of March 3, 2025: 797 shares owned; right to acquire 56,934 via options; DSUs/RSUs 58,161; total beneficial incl. DSUs/RSUs 115,892; percent of class “*”; no pledging by directors/executives permitted; hedging prohibited.
- Shares held in plan accounts: 361.
- Stock ownership guidelines: 4x base salary for NEOs (CEO 10x); executives not at guideline must retain 75% of net shares until achieved; average other NEO ownership 17.7x at FY-end.
| Item | Detail |
|---|---|
| Shares Owned | 797 |
| Right to Acquire (60 days) | 56,934 (stock options) |
| DSUs/RSUs (non-voting until delivery) | 58,161 |
| Pledging/Hedging | Prohibited for executives/directors |
| Ownership Guidelines | 4x base salary (NEOs); 75% post‑vest/exercise retention until met |
| Shares in Plan Accounts | 361 |
Note: Percent of class is disclosed as “less than 1%” for executives overall; individual percentage cell is marked with an asterisk where the proxy lists “*”.
Vesting Schedules and 2024 Realizations
- Standard vesting: Options and RSUs vest pro rata over 3 years; PSUs vest 100% at 3 years subject to performance.
- 2024 vesting and exercises (Berman):
- Options exercised: 25,000 shares; value realized $9,993,500.
- RSUs vested: 1,175 (1/27/24), 1,358 (1/28/24), 2,210 (1/29/24). Values realized $459,895; $531,521; $868,773 respectively.
- PSUs vested (2022–2024 cycle, 1/29/24): 21,544 shares; value realized $8,469,162.
| 2024 Event | Shares | Value ($) | Vest/Exercise Date |
|---|---|---|---|
| Option exercises | 25,000 | 9,993,500 | 2024 (aggregate) |
| RSU vest | 1,175 | 459,895 | 01/27/2024 |
| RSU vest | 1,358 | 531,521 | 01/28/2024 |
| RSU vest | 2,210 | 868,773 | 01/29/2024 |
| PSU vest (2022–2024) | 21,544 | 8,469,162 | 01/29/2024 (payout reflects TSR‑adjusted 175%) |
Outstanding Equity (as of Dec 31, 2024)
| Instrument | Exercisable (#) | Unexercisable (#) | Strike/Price | Expiration/Grant | Unvested RSUs (#) | Unearned PSUs (#) | Market Value of Unvested/Units ($) |
|---|---|---|---|---|---|---|---|
| Options (1/31/2020) | 10,905 | — | $165.41 | 01/31/2030 | — | — | — |
| Options (1/29/2021) | 23,206 | — | $197.87 | 01/29/2031 | — | — | — |
| Options (1/28/2022) | 8,572 | 4,287 | $298.09 | 01/28/2032 | — | — | — |
| Options (1/27/2023) | 3,454 | 6,910 | $344.45 | 01/27/2033 | — | — | — |
| Options (1/26/2024) | — | 9,169 | $391.40 | 01/26/2034 | — | — | — |
| RSUs (1/28/2022 grant) | — | — | — | 01/28/2022 | 1,359 | — | 723,572 |
| RSUs (1/27/2023 grant) | — | — | — | 01/27/2023 | 2,352 | — | 1,252,275 |
| RSUs (1/26/2024 grant) | — | — | — | 01/26/2024 | 3,104 | — | 1,652,663 |
| PSUs (1/28/2022 grant) | — | — | — | 01/28/2022 | — | 7,548 | 4,018,782 |
| PSUs (1/27/2023 grant) | — | — | — | 01/27/2023 | — | 6,532 | 3,477,833 |
| PSUs (1/26/2024 grant) | — | — | — | 01/26/2024 | — | 5,748 | 3,060,408 |
Employment Terms
- No individual employment agreement; covered by U.S. Senior Executive Severance Plan.
- Severance multiples:
- Involuntary not for cause (non‑CoC): 1.5x (base salary + 3‑yr average annual cash incentive).
- Double‑trigger (within 2 years after Change‑in‑Control): 3x (base salary + 3‑yr average annual cash incentive).
- Equity treatment:
- No single‑trigger acceleration on CoC; double‑trigger required. Options/RSUs accelerate in full; PSUs accelerate pro rata on double‑trigger; retirement leads to continued vesting per original schedule.
- AIA on termination: prorated for involuntary not for cause; post‑CoC involuntary/good reason pays average of prior two years. Best‑net approach applies to excise taxes.
- Detrimental conduct agreement: non‑compete/non‑solicit and clawback of prior LTI proceeds for detrimental conduct (lookback two years).
Potential Payouts if Terminated on Dec 31, 2024 (illustrative, from proxy)
| Scenario | Severance Benefit ($) | AIA Payment ($) | Accelerated PSU ($) | Accelerated Options ($) | Accelerated RSUs ($) | SRP Cont. ($) | Benefits ($) | Life Insurance ($) | Total ($) |
|---|---|---|---|---|---|---|---|---|---|
| Voluntary/Retirement | — | 3,325,000 | — | — | — | — | — | — | 3,325,000 |
| For Cause | — | — | — | — | — | — | — | — | — |
| Involuntary Not for Cause | 5,834,000 | 3,325,000 | — | — | — | — | 24,464 | — | 9,183,464 |
| Involuntary/Good Reason post‑CoC | 11,668,000 | 3,159,000 | 7,357,473 | 3,596,661 | 3,628,510 | 1,219,300 | 48,929 | — | 30,677,873 |
| Disability | — | 3,325,000 | 7,357,473 | 3,596,661 | 3,628,510 | — | — | — | 17,907,644 |
| Death | — | 3,325,000 | 7,357,473 | 3,596,661 | 3,628,510 | — | — | 675,000 | 18,582,644 |
Vested plan balances payable on termination (any reason): Retirement Plan $1,079,249; 401(k) $1,504,394; SRP $9,370,736; Deferred Compensation Plan $41,410,493; Total $53,364,872.
Clawbacks, Hedging/Pledging, and Governance
- Clawbacks: NYSE‑compliant recovery policy for restatements (three‑year lookback); additional Executive Leadership Team clawback for material misconduct (awards on/after Jan 1, 2020).
- Hedging/Pledging: Prohibited for directors and executive officers.
- Say‑on‑Pay support: 89% approval in 2024; shareholder outreach representing ~one‑third of outstanding shares.
- Compensation peer group spans Asset Management, Wealth Management, and Insurance peers (e.g., BlackRock, State Street, Schwab, Prudential).
Perquisites, Deferred Comp, and Retirement
- Perquisites (2024 “All Other Compensation” detail): Company 401(k) contributions $17,250; Company match on deferred compensation $166,250; personal aircraft use $4,201 (no car/driver, club dues, home security reported for Berman).
- Deferred Compensation: Executive contribution $665,000 (deferral of AIA), Company contribution $166,250; aggregate earnings $8,797,302; aggregate balance $41,410,493.
- Pension/SRP present value (12/31/2024): Retirement Plan $1,079,249; SRP $9,024,773; total $10,104,022; credited service 56 years.
Performance & Track Record
- 2024 outcomes cited for the Company under Berman’s CFO leadership: record operating performance in net revenues, earnings, EPS, operating margin; strong liquidity and capital; $2.8B returned to shareholders (~80% of adjusted operating earnings).
- PSU earnouts reflect above‑plan performance (2022–2024 cycle at 175%), driven by ROE 49.7% and EPS CAGR 15.9%, with top‑quartile TSR vs S&P 500 Financials (rank 4/60).
- Pay‑versus‑performance table indicates robust TSR and Adjusted Operating EPS progression for 2020‑2024; non‑PEO NEO pay aligns with realized performance through PSU valuation and vesting dynamics.
Compensation Structure Analysis
- High at‑risk mix: Majority of pay is performance‑based (Company policy indicates ~89% for non‑PEO NEOs), with half of equity in PSUs and three‑year performance horizon; options reinforce long‑term focus via 10‑year term.
- Disciplined metrics: AIA ties to five core shareholder metrics and strategic scorecard (70/30 weighting); PSUs calibrated to ROE and EPS CAGR with a market‑relative TSR overlay; Committee permits defined, limited adjustments.
- Strong guardrails: Double‑trigger CoC, robust ownership/holding and anti‑hedging/pledging policies; expanded clawbacks; “best‑net” on excise taxes.
- Signals from behavior: 2024 option exercises ($9.99M value realized) and significant PSU vest (21,544 shares; $8.47M) imply liquidity events that could contribute to periodic insider supply; ongoing RSU/option vesting and sizable unearned PSUs may continue to influence selling cadence around standard January vest dates.
Investment Implications
- Alignment: Heavy use of PSUs with stringent financial/relative metrics, strong ownership and retention policies, and anti‑hedging/pledging rules indicate solid pay‑for‑performance alignment and reduced governance risk.
- Retention: While severance/change‑in‑control protections are robust (up to 3x post‑CoC) and retirement/SRP/deferral balances are substantial, Berman’s advanced age (82) elevates medium‑term succession/transition risk; however, retirement treatment preserves normal vesting schedules rather than accelerating, reducing abrupt overhang.
- Trading signals: Material January vesting (RSUs/options annually; PSUs on 3‑year cadence) and demonstrated 2024 exercises suggest potential recurring selling windows in late January/early February; monitor Form 4s for magnitude/timing around these dates.
- Performance leverage: With PSUs earned at 175% for 2022–2024 and AIA driven by core financial metrics, continued operating outperformance could sustain elevated variable pay and insider share deliveries, but also supports the equity story through demonstrated ROE/EPS growth and industry‑leading TSR.