In recent years, the sky-high compensation of executives in financial industry has aroused heated discussion from the public and scholars at home and abroad has begun to test the reasonability of compensation design of bank executives. Considering the universal skepticism for bank executive compensation, this paper focuses on the reasons for the formation of sky-high compensation of bank executives and compensation gap between executives and employees, as well as their influences on bank risks. Specifically speaking, this paper firstly studies the influence of managerial power on executive compensation in banking. Then it explores the moderating effect of corporate governance on the relationship between managerial power and executive compensation. Finally, it studies the influences of bank executive compensation and compensation gap between executives and employees on bank risks. It concludes that, there is a positive relationship between managerial power and executive compensation in Chinese listed banks, corporate governance of the banks will negatively moderate the positive correlation between managerial power and executive compensation, and compensation gap in internal banks can induce bank risks. These conclusions suggest that the banks should moderately restrain the managerial power and make efforts to improve corporate governance level of banks to ensure the reasonability of executive compensation design, and should reduce the compensation gap reasonably between executives and employees to prevent bank risks caused by the abnormal compensation gap.