Dive Brief:
- Ajay Banga, 61, will retire from his role as Mastercard's executive chairman, the company said Tuesday in a press release. He ceded the CEO role at the card network to Michael Miebach on Jan. 1 after holding that post for a decade.
- Banga's upcoming exit was part of a "planned board leadership transition" initiated last February with the CEO change announcement, though the timing of his retirement had not been previously announced, the company said.
- Mastercard's board voted to appoint Merit Janow, its lead independent director, as the new non-executive independent chair, effective also Jan 1. She is dean of Columbia University's School of International and Public Affairs.
Dive Insight:
During his decade as CEO, Banga managed the second-largest U.S. card company through the aftermath of the Great Recession and led it through digital and international expansion. The payment network's annual revenue tripled to $15 billion during his tenure, regulatory filings show.
Still, the company's annual revenue and net income edged down last year as the COVID-19 pandemic took a toll, with consumers cutting back on travel over concerns about contracting the virus, and also reducing use of their credit cards because of financial uncertainty.
Mastercard’s 2020 executive compensation package — which included $27.7 million for Banga — drew criticism from at least one activist investor in June but was ultimately upheld.
The tribulations presented by the pandemic made it more difficult for card companies to increase their pricing. Mastercard and its larger rival Visa this year postponed a planned interchange rate increase for the second year in a row in the face of pressure not to boost the rates.
Banga, who was born in India and began his career at Nestle, has been the face of Mastercard and cultivated high-profile ties for the business. His public appearances this year have included meeting with Vice President Kamala Harris about his work with the nonprofit Partnership for Central America and speaking to The Washington Post about the impact of the pandemic's "heart-breaking" impact on his native India.
“His strategic and cultural vision transformed the company into what it is today — a leading payments technology company renowned for the strength of its management, extensive partnerships with organizations of all kinds, and an inclusive mindset and innovative approach to everything," Janow said in a statement.
Mastercard was given Banking Dive's inaugural Dive Award for Company of the Year in 2019.
