DEF 14A of S&T Bancorp Inc
Filed Apr 1, 2024 · FY20230001193125-24-082855
General
General The S&T Board determines the number of directors to nominate for election. The By-laws of S&T provide that the number of directors constituting the Board will consist of not less than nine nor more than 17, with the exact number to be fixed and determined from time to time by resolution of a majority of the Board. For this annual meeting, the Board fixed the number of directors to be elected at 11. There are currently 12 directors comprising the Board, however, Steven J. Weingarten intends to retire from the Board effective upon the expiration of his term immediately following the Annual Meeting. The Board has nominated the 11 persons named below for election at the Annual Meeting, all of whom are incumbent directors standing for re-election. Proxies cannot be voted for a greater number of persons than the number of nominees named in this Proxy Statement. The Nominating Committee recommended each of the nominees to the Board. Directors are elected annually, and each director nominee elected at the Annual Meeting will serve for a term expiring at the 2025 S&T annual meeting of shareholders, until his or her successor has been elected and qualified, or until his or her earlier death, resignation, removal or disqualification. All nominees have indicated their willingness to serve, if elected, but if any should be unable to serve or unwilling to serve for good cause, proxies may be voted for a substitute nominee designated by the Board. There are no family relationships between or among any of our directors, executive officers or persons nominated or chosen to become a director or executive officer. Unless otherwise instructed, the proxy holders will vote the proxies received by them for the nominees named below. Set forth below is a brief description of the principal occupation and business experience of each of our nominees for director, as well as a summary of the qualifications of each nominee and continuing director to serve on the Board. The Board has had significant experience with each of the incumbent directors and has had the opportunity to assess the contributions that each director has made to the Board as well as each director’s industry knowledge, judgment and leadership capabilities. The Nominating Committee continually assesses the tenure and diversity of the Board and seeks opportunities, within the constraint of the size of the Board, to include a mix of directors with Board experience and with fresh perspectives. The average tenure of the current Board is 11.7 years and S&T’s Guidelines include a mandatory director retirement age of 72. In the last seven years, the Nominating Committee has had the opportunity to add seven (64% of the 11 director nominees) new directors to the Board to further diversify the Board’s industry knowledge, experience, judgment, gender, minority status and leadership capabilities. The Board has two female directors, one African American director and one Asian director. The following directors were appointed to the Board in the last seven years: Christina A. Cassotis, David G. Antolik, Lewis W. Adkins, Jr., Peter R. Barsz, William J. Hieb, Christopher J. McComish, and Bhaskar Ramachandran. S&T seeks director candidates who will uphold the highest standards, are committed to S&T’s values, and who will be strong independent stewards of the long-term interests of shareholders. In selecting nominees, our Board looks for individuals with demonstrated experience and success in fields that are relevant to our business, strategy and operations, and who will contribute diverse viewpoints and perspectives. In evaluating and selecting nominees to the Board, our Nominating Committee considers all factors and criteria it deems appropriate, including, but not limited to, the factors set forth in our Guidelines. See the section “Director Qualifications and Nominations; Board Diversity” below for further information on our director selection process and criteria. In furtherance of the foregoing, the Board considers a wide range of attributes when selecting and recruiting candidates. All nominees possess integrity, judgment, strong work ethic, collaborative approach to engagement and oversight, inquisitive and objective perspective, and a willingness to challenge management appropriately. In addition, our nominees have executive experience and skills that are aligned with our business and strategy, including the following:
General
| Board Skills | | | Core Skills and Qualifications | | | Banking and Financial Services Industry | Corporate Governance | | Leadership (Strategy & Execution) | Compensation & Succession | | Financial Expertise Regulatory/Risk Management | Technological (Cyber, Information Technology & Innovation) | | | Other Board Experience | | Additional Relevant Experiences | | | Business Development | Investor Relations & Engagement | | Mergers & Acquisitions | Local Market | | Capital Markets | Diversity |
General
Director Nominees for Election at the 2024 Annual Meeting:
General
| | Lewis W. Adkins, Jr., Age 60 | | | | Director since 2019 | Committees: • Credit Risk • Nominating & Corporate Governance |
Biographical Information
Biographical Information Mr. Adkins is a Shareholder and Shareholder-in-Charge of Development & Practice Integration for Roetzel & Andress, LPA, a full-service law firm with offices located throughout Ohio, Florida and Chicago. Additionally, since May 2017, he has served as President of their wholly-owned consulting subsidiary, Roetzel Consulting Solutions, a bipartisan consulting company representing clients where the private and public sectors intersect. Mr. Adkins previously served as General Counsel to Summit County, Ohio. He is affiliated with numerous professional and charitable organizations including Board Chair for the University of Akron Board of Trustees, Ideastream Public Media Board of Trustees, the American Bar Association, the Greater Akron Chamber of Commerce, Alpha Phi Alpha Fraternity, Inc. and the Cleveland Metropolitan Bar Association. Mr. Adkins also has acted as lead counsel for several multi-million-dollar development projects. His clients include public and private entities, as well as construction companies, engineering firms, financial institutions, diversified energy companies, governmental entities, housing authorities, urban school districts and nonprofit organizations. Prior to assuming his current leadership role, Mr. Adkins led for over a decade Roetzel & Andress, LPA’s Public Law and Finance team as Practice Group Manager. Additionally, he is currently General Counsel to Alpha Phi Alpha Homes, Inc.. He also serves as lead counsel for a number of public and private entities including Ohio’s largest banking institution, a regional public hospital and two of Ohio’s largest school districts. Mr. Adkins’ expansive business and legal knowledge and his community leadership provide the S&T Board with public finance, business development, and strategic management experience which qualifies him to serve on the S&T Board.
Biographical Information
| | David G. Antolik, Age 57 | | | Director since 2019 President |
Biographical Information
Biographical Information Mr. Antolik has been President of S&T and S&T Bank since January 2019. He was Interim Chief Executive Officer and President from April 1, 2021 to August 23, 2021. Mr. Antolik was Chief Lending Officer of S&T and S&T Bank from 2008 to October 2020. He previously served as Senior Executive Vice President of S&T and S&T Bank from 2008 until January 2019. Mr. Antolik also serves as the chairman of the IUP Research Institute and is a member of the Indiana County Development Corporation Board.
Experience and Qualifications
Experience and Qualifications With 35 years of banking experience, including 16 years of senior management experience at S&T, Mr. Antolik’s strong leadership capabilities and in-depth industry experience in commercial banking and implementing strategic initiatives provide the S&T Board with expertise that will contribute to the strategic growth of S&T. As our past Interim Chief Executive Officer and current President, Mr. Antolik provides unique insight to the S&T Board regarding our day-to-day operations, customer information, competitive intelligence, general trends in national and local banking and issues regarding our financial results.
Experience and Qualifications
| | Peter R. Barsz, Age 67 | | | | Director since 2019 | Committees: • Audit • Compensation & Benefits • Nominating & Corporate Governance |
Biographical Information
Biographical Information Mr. Barsz is a Certified Public Accountant and has been a Partner at Barsz Gowie Amon & Fultz, LLC, an accounting firm, since July 2017 when Steger Gowie & Company merged with Merves Amon & Barsz LLC where Mr. Barsz became a partner in 1990. Mr. Barsz previously served on the board of DNB, the holding company for DNB First, N.A., from January 2018 until it was acquired by S&T in November 2019. Mr. Barsz serves as the appointed Treasurer and has served as the Finance Director of several municipalities in Chester and Delaware counties and is currently serving as Chairman of the Pennsylvania State Tax Equalization Board, an independent agency of the Commonwealth tasked with obtaining information on real estate sales throughout the state. Mr. Barsz also received an appointment by the Pennsylvania Legislature and is currently serving as a public member on the Legislative Audit Advisory Committee for the current and past three Legislative Sessions of the General Assembly. Mr. Barsz previously served as a director of two real estate holding companies located in Media, Pennsylvania as well as the Treasurer of the Foundation of the Delaware County Chamber of Commerce. Mr. Barsz’s extensive experience in accounting and providing management and financial consulting services to governmental and nonprofit entities, his deep community engagement, as well as his broad financial perspective qualify him to serve on the Audit Committee as an “audit committee financial expert” and on the S&T Board.
Biographical Information
| | Christina A. Cassotis, Age 59 | | | | Director since 2017 | Committees: • Audit • Compensation & Benefits (Chairperson) • Executive • Risk |
Biographical Information
Biographical Information Ms. Cassotis has been the chief executive officer of the Allegheny County Airport Authority, which operates Pittsburgh International Airport and Allegheny County Airport since January 2015. Prior to that, Ms. Cassotis joined SH&E, Inc. in 1999, a global commercial aviation consulting firm, where she advised airports worldwide on strategy, business, and system planning. She went on to serve as managing officer for Airport Services for ICF-SH&E from 2007 to 2014, leading a global team of airport consultants. She also serves as a member of the board for the U.S. Travel Association, a member of the Board at the Federal Reserve Bank of Cleveland (Pittsburgh Branch) and a member of the International Aviation Women’s Association. Ms. Cassotis served as a director of EQT Corporation from October 2018 until July 2019.
Experience and Qualifications
Experience and Qualifications Ms. Cassotis has demonstrated that she is a strong, decisive, and strategic leader. Her ability to identify the complex relationship between organizations and the competitive environments in which they operate has allowed her to position her business interests for the future while paying attention to immediate demands. Her substantial leadership roles within a highly-regulated, high-stakes industry provide valuable risk oversight experience, including with respect to cyber and technology, to the S&T Board. She is an innovative leader who has successfully directed necessary change through organizations to drive growth and deliver value which qualifies her to serve on the S&T Board.
Experience and Qualifications
| | Michael J. Donnelly, Age 66 | | | | Director since 2001 | Committees: • Compensation & Benefits • Credit Risk |
Biographical Information
Biographical Information Mr. Donnelly has been president of Indiana Printing and Publishing Company, Inc. since 1993. Mr. Donnelly has spent over 30 years working with the Indiana County Chamber of Commerce and the Indiana County Development Corporation in retaining and attracting many businesses in the Indiana, Pennsylvania area. Mr. Donnelly’s deep experience in managing and operating a local business provides the S&T Board with valuable insight into the issues addressing our local corporate and consumer borrowers. Mr. Donnelly’s experience in developing appropriate compensation for the executives and senior management of his company qualifies him to serve on the S&T Board.
Biographical Information
| | Jeffrey D. Grube, Age 70 | | | | Director since 1997 | Committees: • Audit • Compensation & Benefits • Credit Risk (Chairperson) • Executive • Risk |
Biographical Information
Biographical Information Mr. Grube served as president of B.F.G. Manufacturing Service, Inc., which provides large volume plating, painting and powder coating services with facilities in Pennsylvania and New York from 1990 until his retirement in 2020. Mr. Grube’s career as an executive in the manufacturing industry includes financial and engineering experience. Mr. Grube also served as a director on the board of a privately held company that supplies compliance products for lending solutions.
Experience and Qualifications
Experience and Qualifications Mr. Grube’s extensive experience working with small and medium-sized businesses provides the S&T Board with valuable experience regarding potential borrowers and customers, customer relations, lending issues and credit risk. Mr. Grube’s executive and board experience in the manufacturing sector and experience with financial institutions allow him to bring relevant insight regarding regulatory and financial compliance issues to the S&T Board.
Experience and Qualifications
| | William J. Hieb, Age 67 | | | | Director since 2019 | Committees: • Credit Risk • Executive • Risk (Chairperson) |
Biographical Information
Biographical Information Mr. Hieb served as the president and chief executive officer of DNB, the holding company for DNB First, N.A. since April 2016 until it was acquired by S&T in November 2019. He was a director of DNB since 2005 and a director of DNB First, N.A. since 2004. Mr. Hieb served as president and chief risk & credit officer of DNB from April 2011 to January 2016. Prior to that, Mr. Hieb served as president and chief operating officer of DNB from January 2005 to April 2011. Mr. Hieb has previously served on the board of directors for the Chester County Chamber of Business and Industry, the Chester County Historical Society, the Chester County Economic Development Council, the Chester County Chamber of Business and Industry and its Foundation, the Pennsylvania Bankers Association, the Housing Partnership of Chester County and Business Leadership Organized for Catholic Schools, and the West Chester University’s President Corporate Advisory Council. Mr. Hieb has acquired considerable knowledge and experience during his 41 years in commercial banking including lending, credit administration, and wealth management. In addition, his background supervising DNB’s risk management function and operations during his career strengthens the Board’s collective qualifications, skills, and experience, and qualifies him to serve on the S&T Board.
Biographical Information
| | Christopher J. McComish, Age 59 | | | | Director since 2021 Chief Executive Officer | Committees: • Executive |
Biographical Information
Biographical Information Mr. McComish has been Chief Executive Officer of S&T and S&T Bank since August 24, 2021. Previously, he was senior executive vice president of consumer banking of TCF Bank, leading all consumer banking lines of business as well as business banking and wealth management from July 2018 to June 2021. Prior to TCF Bank, he served as president and chief executive officer of Scottrade Bank, the banking subsidiary of Scottrade Financial Services, Inc. from August 2015 to December 2017. In addition, he served as head of personal banking and then as chief operating officer for personal and commercial banking at BMO Harris Bank from December 2008 to July 2015. He began his career at Wachovia Bank, where he spent over 20 years in various regional and line of business leadership roles.
Experience and Qualifications
Experience and Qualifications With more than 36 years of banking experience, including 21 years of senior management experience in his banking career, Mr. McComish’s strong leadership capabilities as a former chief executive officer, president and chief operating officer at other banking institutions and as senior executive vice president with a larger bank in the Midwest, provide the S&T Board with expertise that contributes to the strategic growth of S&T. As our Chief Executive Officer, Mr. McComish provides in-depth industry experience and insight in commercial banking, consumer banking, business banking and wealth management from a larger bank perspective. He is familiar with the impact of technology on banking, having served as the chief executive officer of a digital online bank, and brings to the S&T Board technology risk management experience. He also provides unique insight to the S&T Board regarding our day-to-day operations, risk and strategic initiatives, general trends in national and local banking, and issues regarding our financial results.
Experience and Qualifications
| | Frank J. Palermo, Jr., Age 71 | | | | Director since 2013 | Committees: • Audit (Chairperson) • Executive • Nominating & Corporate Governance • Risk |
Biographical Information
Biographical Information Mr. Palermo is a Certified Public Accountant and has been the managing shareholder of Palermo/Kissinger & Associates, P.C., an accounting firm, since 1983. Mr. Palermo played an integral role in forming Gateway Bank of Pennsylvania (“Gateway”), where he served as chairman of the audit committee from its inception in 2004 through the date S&T acquired Gateway in 2012. Previously, Mr. Palermo served as a Certified Valuation Analyst as well. Mr. Palermo’s career also includes 43 years in public accounting and five years as a vice president and controller at a community bank. Mr. Palermo’s background in accounting and finance, as well as his prior bank audit committee experience, bring a valuable perspective to the S&T Board both with respect to accounting, financial, and strategic aspects of S&T’s business and to the Audit Committee on which he serves as an “audit committee financial expert.” Mr. Palermo’s extensive board experience qualifies him to serve on the S&T Board.
Biographical Information
| | Bhaskar Ramachandran, Age 50 | | | Director since 2024 |
Biographical Information
Biographical Information Mr. Ramachandran has served as Global Vice President and Chief Information Officer of PPG Industries, Inc., a 140-year old Pittsburgh-based leading paints and coatings company, since 2021. From 2015 until joining PPG, Mr. Ramachandran served as Vice President, Information Technology, and Chief Information Officer of the largest division, of Jabil Inc., an American worldwide manufacturing services company. At Jabil, Inc., he led the creation of a fully cloud-based connected eco-system to make production more efficient and cost-effective. Prior to joining Jabil, Inc., Mr. Ramachandran progressed through information technology roles of increasing responsibility at Textron, Inc., a multi-industry company, where he was accountable for strategy development and operational elements of Textron, Inc.’s SAP center of excellence. Mr. Ramachandran’s deep knowledge of cybersecurity and information technology provide the Board with valuable cyber and technology risk expertise, as well as a strong understanding of digital business strategies and emerging technology. Mr. Ramachandran’s extensive leadership experience at large, regulated companies, including his proven track record in scaling and transforming businesses, brings a diverse range of skills and knowledge that further contribute to an engaged and well-balanced Board. His work developing and leading diverse, high-performing teams across different industries and global companies also provides the Board with a unique perspective on people, process, adaptability and emotional intelligence.
Biographical Information
| | Christine J. Toretti, Age 67 | | | | Director since 1984 | Committees: • Executive (Chairperson) • Risk |
Biographical Information
Biographical Information Ms. Toretti was named Chairperson of the S&T Board and S&T Bank Board in 2018 and was formerly Vice Chairperson of the S&T Board and S&T Bank Board from 2013 to 2018. Ms. Toretti has been the president of Palladio, LLC, an investment holding company headquartered in Indiana, Pennsylvania, since 2011, was the chairman and chief executive officer of S.W. Jack Drilling Company from 1990 through 2010 and was the president of The Jack Company from 1988 through 2015. Ms. Toretti has been the president of Plum Production, Inc. since 1991, and president of CJT, LLC since 2002, each of which is a natural gas investment company. Ms. Toretti served as a director of EQT Corporation from October 2015 until July 2019.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION The Nominating Committee annually reviews S&T’s director compensation and makes recommendations to the Board. S&T’s director compensation is designed to align the S&T Board with its shareholders and to attract, motivate and retain high performing members critical to S&T’s success. A directors’ compensation analysis including a peer comparison is completed annually. The objective is to evaluate our director compensation against our peer group to ensure S&T’s compensation practices for our directors are consistent with banks our size and within similar markets. S&T uses a combination of cash and restricted units to attract and retain qualified candidates to serve on the Board. Restricted stock grants are intended to align directors’ interests with those of S&T’s shareholders. In 2023, our non-employee directors received compensation for serving on the Board and attending Board and committee meetings, or educational seminars, in the amounts described below. Employee members of the Board receive no additional compensation for participation on the Board. We reimbursed various directors for amounts expended for traveling to our meetings and to educational seminars. We determined these amounts were consistent with our guidelines and thus are not included in the 2023 Director Compensation table.
DIRECTOR COMPENSATION
| Directors’ Fees | | | Annual Cash Retainer | $70,000 | | Annual Stock Award(1) | 50,000 | | Board and Committee Chairperson Retainer Fees | | | Chairperson | $90,000 | | Audit Chairperson | 20,000 | | Compensation and Benefits Chairperson | 12,500 | | Credit Risk Chairperson | 12,500 | | Nominating and Corporate Governance Chairperson | 12,500 | | Risk Committee Chairperson | 12,500 |
DIRECTOR COMPENSATION
| (1) On May 16, 2023, the S&T Board approved an annual unit award valued at $50,000, resulting in 1,905 shares of S&T Common Stock based on that day’s $26.26 per share closing price with 100% vesting on May 14, 2024. |
DIRECTOR COMPENSATION
Director Compensation The following table provides information concerning compensation paid by S&T to its non-employee directors during 2023.
Director Compensation Table for Fiscal Year 2023
Director Compensation Table for Fiscal Year 2023
Director Compensation Table for Fiscal Year 2023
| Name(3) | Fees Earned or Paid in Cash ($) | Stock Awards ($) (1)(2) | Total ($) | | Lewis W. Adkins, Jr. | 70,000 | 50,000 | 120,000 | | Peter R. Barsz | 70,000 | 50,000 | 120,000 | | Christina A. Cassotis | 82,500 | 50,000 | 132,500 | | Michael J. Donnelly | 70,000 | 50,000 | 120,000 | | Jeffrey D. Grube | 82,500 | 50,000 | 132,500 | | William J. Hieb | 82,500 | 50,000 | 132,500 | | Frank J. Palermo, Jr | 90,000 | 50,000 | 140,000 | | Christine J. Toretti | 160,000 | 50,000 | 210,000 | | Steven J. Weingarten | 82,500 | 50,000 | 132,500 |
Director Compensation Table for Fiscal Year 2023
| (1) The Board awarded 1,905 restricted units to each non-employee director on the Board on May 16, 2023, with such shares vesting in full on May 14, 2024. The fair market value of the units granted on May 16, 2023 was $26.26 per share calculated based on the closing value as of May 16, 2023. The values for unit awards in this column represent the grant date fair value of the restricted units granted in 2023, computed in accordance with FASB ASC Topic 718. Information about the assumptions used to value these awards can be found in Note 21 “Incentive and Restricted Stock Plan and Dividend Reinvestment Plan” in our Annual Report on Form 10-K for the year ended December 31, 2023. This column includes the value of these stock awards, all of which were issued under the 2021 Incentive Plan. |
Director Compensation Table for Fiscal Year 2023
| (2) As of December, 31, 2023, each director had unvested awards of 1,905 restricted units. |
Director Compensation Table for Fiscal Year 2023
| (3) Mr. Ramachandran joined the Board in January 2024 and, therefore, did not receive any compensation for service during 2023. |
Key 2023 Compensation Decisions
| • | Approved payouts under the 2023 Management Incentive Plan (“2023 MIP”) at 81% of the Corporate Component of the target for each NEO. |
Key 2023 Compensation Decisions
| • | Granted annual long-term incentive awards under the terms of the 2023 Long-Term Incentive Plan (“2023 LTIP”), 50% of which vest based on continued employment and 50% of which vest based on continued employment and the achievement of pre-determined performance metrics. |
Executive Compensation Philosophy and Practices
| WHAT WE DO | | WHAT WE DON’T DO | | ☑ | Align our compensation program with shareholder interests. | ☒ Provide tax gross-ups to any of our NEOs. ☒ Provide excessive perquisites or personal benefits to our NEOs. ☒ Allow repricing, backdating, or discounting of stock options. ☒ Provide for prepayment of dividends on unearned restricted shares. ☒ Provide single trigger vesting of equity-based awards upon a change in control. ☒ Allow pledging or hedging of Common Stock by our NEOs. | | ☑ | Emphasize adherence to strong pay for performance principles to appropriately balance risk and reward and reinforce engagement among the leadership team and S&T key contributors. | | | ☑ | Structure our compensation program to effectively attract and retain top talent and allow for succession planning. | | | ☑ | Ensure sound risk management and effective controls. | | | ☑ | Per SEC requirement, subject all payments to claw-back provisions that allow S&T to cancel or recoup any bonus, retention award or incentive compensation paid or required to be paid to our NEOs if the payment was based on materially inaccurate financial statements or any other materially inaccurate performance metric criteria. | | | ☑ | Maintain robust stock ownership guidelines that require our NEOs to own Common Stock with a fair market value equal to 3X base salary for the CEO and President and 2X base salary for our other NEOs.(1) | |
Executive Compensation Philosophy and Practices
| (1) As of December 31, 2023, Messrs. Antolik, Drahnak and Kochvar and Ms. Yesho meet the ownership guidelines. Mr. McComish was hired effective August 23, 2021, and has not yet acquired the 3X ownership guideline. Our guidelines limit the ability of the NEOs to liquidate only the number of the vesting restricted shares of Common Stock sufficient for paying current tax liabilities on the vesting shares, until the officer achieves the stock ownership guidelines. |
Use of Competitive Data
Use of Competitive Data The Compensation Committee reviews comparisons of the compensation programs established by peer banks for executives having similar responsibilities to S&T’s executives to obtain a general understanding of current market practices to assist in evaluating S&T’s compensation program. In 2023, the Compensation Committee engaged Aon to advise on the appropriateness of the banks in the peer group considering S&T’s current status and common practices among peer banking organizations for defining peer groups for executive compensation review purposes. The Compensation Committee reviewed and agreed with Aon’s recommendations and selected the following peer group based on similar size and scope to S&T and operating both inside and outside S&T’s geographic market (collectively, the “Peer Banks”):
Use of Competitive Data
| 1st Source Corporation | Lakeland Financial Corp. | | Berkshire Hills Bancorp, Inc. | NBT Bancorp, Inc. | | Brookline Bancorp, Inc | OceanFirst Financial Corp | | Camden National Corp. | Park National Corporation | | City Holding Company | Peoples Bancorp, Inc | | Community Bank System, Inc. | Premier Financial Corp. | | First Commonwealth Financial Corporation | Republic Bancorp, Inc. | | First Financial Bancorp | Sandy Spring Bancorp, Inc | | First Merchants Corporation | Tompkins Financial Corporation | | German American Bancorp Inc | WesBanco, Inc. | | Horizon Bancorp, Inc. | |
Use of Competitive Data
The Peer Banks were used by Aon to analyze the total direct compensation for S&T’s executives for 2023. The Compensation Committee uses the companies in the S&P 600 Bank Industry Index as of January 1 of the plan year (the “Performance Peer Group”) for comparing S&T’s relative performance for that year’s LTIP. The companies in the S&P 600 Bank Industry Index as of January 1, 2023 are the Performance Peer Group for the 2023 LTIP.
Total Direct Compensation Position
Total Direct Compensation Position S&T’s target pay mix is built on competitive base salaries, with generally moderate annual and long-term incentive targets. The moderate positioning of annual incentives and long-term incentives reflects our commitment to introducing pay program modifications that are both sensitive to S&T’s proactive risk management culture while, at the same time, responding appropriately to the importance of retaining a strong and committed leadership team at S&T. The Compensation Committee reviews this posture periodically with the help of outside advisors. For NEOs, the Compensation Committee reviews a number of analyses of compensation practices to help facilitate its executive compensation decisions. These include:
Total Direct Compensation Position
| • | Pay mix representing the effectiveness of balancing long-term versus short-term performance imperatives; |
Total Direct Compensation Position
| • | Current pay relative to peer group practices; |
COMPONENTS OF THE COMPENSATION PROGRAM
| Compensation Component | Description | | Base Salary | Base salary is fixed compensation that is reviewed annually and is based on performance, experience, responsibilities, skill set, and market value. It provides a base level of compensation that corresponds to the job function performed and serves to attract, retain, reward, and motivate qualified and experienced executives. | | Management Incentive Plan (“MIP”) | An annual incentive plan with a target incentive opportunity designed to encourage retention, appropriately reward executive officers for meeting individual and company performance goals, and ensure competitive pay practices when recruiting new or additional leadership positions. | | Long-Term Incentive Plan (“LTIP”) | A long-term incentive program that serves three purposes: (1) to help promote leadership retention and management continuity as S&T continues to execute its longer-term strategic plan; (2) to reward management for strong sustained value creation and financial performance; and (3) to align our executives’ interests with those of our shareholders via appropriately-sized grants of equity compensation. | | Other Benefits | Consists of certain other customary, broad-based benefits provided to S&T employees (e.g., retirement and health plan benefits) and limited, non-excessive perquisites, when appropriate. | | Double Trigger Change in Control Severance Protections | We provide our NEOs with double trigger change in control severance to protect the executives during potentially tumultuous corporate transactions, allow executives to focus on generating shareholder value during any change in control, and provide market-competitive post-employment compensation. |
Management Incentive Plan Awards
Management Incentive Plan Awards For 2023, we adopted the 2023 MIP, an annual cash incentive award with a target equal to a set percentage of base salary for each of our NEOs. The following formula is used to determine MIP award payouts: To further strengthen the linkage between the MIP award, risk management, and shareholder value creation, the MIP contains a “Shareholder Protection Feature” in which payouts will not occur for any plan year if S&T falls below “well capitalized” capital ratio requirements established by regulatory authorities, determined as of and up to the date that any payment would ordinarily occur pursuant to the MIP’s provisions. In addition to the Shareholder Protection Feature of the MIP, the MIP is operational only if S&T achieves Return on Average Equity (“ROAE”) for the plan year of at least 5% (the “Minimum Gateway Requirement”). The Compensation Committee believes that these features, coupled with the claw-back requirements and the use of multiple performance measures, provide for substantial protection against excessive or unnecessary risk-taking by any plan participant.
Target Bonus Percentages
Target Bonus Percentages The following table shows the target percentage of base salary. The Compensation Committee, considering Aon’s advice, continued to omit the individual performance component and set S&T’s corporate performance factor as the only performance component of the 2023 MIP for the NEOs and other Section 16 officers. We believe that the 2023 MIP’s targets are consistent with our philosophy of providing our NEOs the opportunity for reasonable annual incentives and designing a larger portion of compensation as “at-risk” to reflect their roles within our organization. We also believe the corporate performance factor appropriately recognizes the importance of S&T achieving key financial performance goals.
Target Bonus Percentages
| Named Executive Officer | MIP Target % of Base Salary | | Christopher J. McComish, Chief Executive Officer | 67% | | Mark Kochvar, Senior Executive Vice President and Chief Financial Officer | 50% | | David G. Antolik, President | 50% | | Stephen A. Drahnak, Executive Vice President and Chief Commercial Banking Officer | 40% | | LaDawn D. Yesho, Executive Vice President and Chief Risk Officer | 40% |
Corporate Performance Factor
| Performance Level | EPS Goal | PPNR Ratio | Asset Quality | Payout Level Percentage of Allocated Target | | Below Threshold | Below $3.46 | Below 2.06% | Above 0.59% | 0% | | Threshold | $3.46 | 2.06% | 0.59% | 25% | | Target | $4.00 | 2.35% | 0.41% | 100% | | Maximum | Above $4.40 | Above 2.57% | Below 0.31% | 175% |
Summary of 2023 MIP Payouts
Summary of 2023 MIP Payouts The Payout Level Percentage for 2023 MIP Payouts to the NEOs was 81% of target, determined as follows:
MIP results
MIP results
MIP results
| Performance Metric | Target Performance Level | Actual Performance Level | | EPS | $4.00 | $3.74 | | PPNR | 2.35% | 2.12% | | Asset Quality | 0.41% | 0.30% |
MIP results
Based on achieving 81% of the Target Performance Level, the Compensation Committee approved the following cash awards under the 2023 MIP to each NEO:
MIP results
| Named Executive Officer | Actual Payout as a Percentage of Base Salary | Award Amount ($) | | Christopher J. McComish, Chief Executive Officer | 54% | $407,025 | | Mark Kochvar, Senior Executive Vice President and Chief Financial Officer | 41% | $177,390 | | David G. Antolik, President | 41% | $202,500 | | Stephen A. Drahnak, Executive Vice President and Chief Commercial Banking Officer | 32% | $113,400 | | LaDawn D. Yesho, Executive Vice President and Chief Risk Officer | 32% | $110,160 |
Long-Term Incentive Plan Awards
Long-Term Incentive Plan Awards The LTIP is designed to: (1) to help promote leadership retention and management continuity as S&T continues to execute its longer-term strategic plan; (2) to reward management for strong sustained value creation and financial performance; and (3) to align our executives’ interests with those of our shareholders via appropriately-sized grants of equity compensation. The 2023 LTIP puts a greater focus on performance and serves to create a balance between long-term and short-term performance imperatives, beyond that offered by the annual cash incentive under the MIP. The changes implemented in 2022 were maintained in 2023 for the LTIP awards. The target opportunities as a percentage of base salary remained at 50% for the President and the CFO and 40% for all other non-CEO NEOs. The CEO has a target opportunity of 100% in accordance with his employment agreement. The Compensation Committee determined to keep payout levels on the peer-relative ROAE metric at 50% of target (Threshold Performance), 100% of target (Target Performance) and 150% of target (Maximum Performance) and the peer-relative TSR to a modifier to the ROAE payout metric: -30% (Threshold or below), 0% (Target) and +30% (Maximum). We consider the upside on the ROAE payout metric combined with the TSR modifier to offer a long-term incentive that better aligns the interests of NEOs with shareholders. Lastly, our 2023 time-based restricted awards are scheduled to vest pro rata annually over three years after the grant date. The 2023 LTIP contains the same Shareholder Protection Feature for all awards and the Minimum Gateway Requirement for the performance-based restricted shares as described earlier for the 2023 MIP. The Compensation Committee believes that these features, coupled with the restricted stock and claw-back requirements, provide for substantial protection against excessive or unnecessary risk-taking by any plan participant.
2023 Long-Term Incentive Awards
2023 Long-Term Incentive Awards Effective April 1, 2023, the Compensation Committee awarded the NEOs equity denominated long-term incentive awards of restricted stock units (“RSUs”) under the 2023 LTIP. Grants were made at a grant price equal to $32.32 per share, which was the average of the high and low price of S&T Common Stock for the ten trading days ending on the grant date. Each NEO’s target award consists of the following: Time-based units vest in equal amounts on each anniversary of their grant date over three years. Performance-based units (“PRSUs”) may be earned over a three-year period based on the Company’s Return on Average Equity (“ROAE”) and Total Shareholder Return (“TSR”) performance relative to the Performance Peer Group (defined in “Use of Competitive Data” on page 36), as described in more detail below. The following awards were granted under the 2023 LTIP to the NEOs:
2023 Long-Term Incentive Awards
| Named Executive Officer | Value of 2023 LTIP Award | Number of Time-Based Units | Number of Performance-Based Units | | Christopher J. McComish | 729,829 | 11,603 | 11,603 | | Mark Kochvar | 213,105 | 3,388 | 3,388 | | David G. Antolik | 243,297 | 3,868 | 3,868 | | Stephen A. Drahnak | 136,241 | 2,166 | 2,166 | | LaDawn D. Yesho | 132,342 | 2,104 | 2,104 |
2023 LTIP Performance Metrics
2023 LTIP Performance Metrics Two metrics are used to determine the percentage of the PRSU target earned through vesting of the PRSU awards (also referred to as performance shares). The Compensation Committee believes that ROAE measures and incentivizes S&T’s long-term profitability vis-à-vis our peers, while our relative TSR captures our shareholder return vis-à-vis our peers.
(A) Return on Average Equity (“ROAE”) for 2023 through 2025 relative to the Performance Peer Group
(A) Return on Average Equity (“ROAE”) for 2023 through 2025 relative to the Performance Peer Group Participants can earn from 0% to 150% of their PRSU Target based on this metric as summarized below:
(A) Return on Average Equity (“ROAE”) for 2023 through 2025 relative to the Performance Peer Group
| Performance Level | ROAE for 3-year Performance Period Relative to the Performance Peer Group | Vesting Percentage* | | Below Threshold | Below the 25th percentile of the Performance Peer Group | 0% of Target | | Threshold | 25th percentile of the Performance Peer Group | 50% of Target | | Target | 50th percentile of the Performance Peer Group | 100% of Target | | Maximum | 75th percentile of the Performance Peer Group | 150% of Target |
(A) Return on Average Equity (“ROAE”) for 2023 through 2025 relative to the Performance Peer Group
| * Linear interpolation is utilized to determine awards between Threshold and Target and Target and Maximum. |
(B) Cumulative Total Shareholder Return for 2023 through 2025 relative to Performance Peer Group
(B) Cumulative Total Shareholder Return for 2023 through 2025 relative to Performance Peer Group The preliminary Earned PRSU Payout calculated above is subject to adjustment by the Bank’s cumulative TSR for the three-year Performance Period. Participant’s PRSU awards can be modified by up to 30% higher or lower if the Bank’s cumulative TSR is higher or lower than the 50th percentile of the Peer Group.
(B) Cumulative Total Shareholder Return for 2023 through 2025 relative to Performance Peer Group
| Performance Measures and Performance Standards Peer Relative TSR | | | | Performance Level | TSR for 3-year Average Calendar Year Period Ending December 31, 2025 Relative to Peer Group | Modifier of PRSU Award Target Amount | | Threshold or Below | 25th percentile | -30% | | Target | 50th percentile | 0% | | Maximum | 75th percentile | +30% |
(B) Cumulative Total Shareholder Return for 2023 through 2025 relative to Performance Peer Group
The Modifier will vary depending on Actual Performance, and the payout curve rises continuously from Threshold to Target and from Target to Maximum. Therefore, to determine awards between Threshold and Target and Target and Maximum, linear interpolation would be utilized.
Vesting of 2020 Long-Term Incentive Plan Awards
Vesting of 2020 Long-Term Incentive Plan Awards Because S&T was below the 50th percentile for 3 Year ROAE and below the 50th percentile for TSR relative to the peer banks identified at the time of grant, the NEOs’ performance-based shares granted on April 1, 2020 did not vest and were forfeited in 2023. The Committee approved the vesting of the time-based awards based on S&T meeting the Shareholder Protection Feature.
Double Trigger Change in Control Severance Protections
Double Trigger Change in Control Severance Protections S&T enters into change in control agreements with selected officers in senior management, including all the NEOs to help ensure that S&T’s leadership team remains engaged and focused should the organization ever become the target of a change in control where their jobs or ongoing compensation could be at risk. The primary terms and compensation payments contemplated by the agreements also include robust non-competition and non-solicitation provisions, one or both of which must be agreed to by the executive to receive the benefits provided. The Compensation Committee believes that the change in control agreements provide reasonable protection to the individual members on the senior management team and thereby align senior management’s interest with the interest of S&T’s shareholders.
Employment Agreements
Employment Agreements S&T provided employment agreements to Messrs. McComish and Antolik for their roles as CEO and President, respectively, on July 12, 2021. S&T does not provide employment agreements for any of the other NEOs. For more detail regarding the employment agreements for Messrs. McComish and Antolik see further discussion in Additional Narrative Information – Compensation Agreements on page 47.
Summary Compensation Table
Summary Compensation Table
Summary Compensation Table
| Name and Principal Position | Year | Salary (1) | Bonus ($) (2) | Stock Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | Change in Pension Value (5) | All Other Compensation ($)(6) | Total ($) | | Christopher J. McComish | 2023 | 750,000 | — | 839,303 | 407,025 | — | 92,801 | 2,089,129 | | Chief Executive Officer | 2022 | 750,000 | — | 847,888 | 859,275 | — | 51,643 | 2,508,806 | | | 2021 | 230,769 | 300,000 | 248,605 | — | — | 107,870 | 887,244 | | Mark Kochvar | 2023 | 429,077 | — | 245,071 | 177,390 | 17,100 | 23,232 | 891,870 | | Sr. Executive Vice President and Chief Financial Officer | 2022 | 371,554 | 507 | 214,804 | 324,900 | — | 22,182 | 933,947 | | | 2021 | 355,600 | — | 144,844 | 162,260 | — | 21,832 | 684,536 | | David G. Antolik | 2023 | 500,000 | — | 279,792 | 202,500 | 136,500 | 52,406 | 1,171,198 | | President | 2022 | 500,000 | — | 462,633 | 427,500 | — | 45,543 | 1,435,676 | | | 2021 | 443,785 | 200,000 | 230,036 | 302,097 | — | 39,762 | 1,215,680 | | Stephen A. Drahnak | 2023 | 347,692 | — | 156,678 | 113,400 | 82,200 | 41,430 | 741,400 | | Executive Vice President and Chief Commercial Banking Officer | 2022 | 316,308 | 507 | 142,453 | 220,482 | — | 36,629 | 716,379 | | | 2021 | 273,000 | 25,000 | 268,867 | 131,177 | — | 30,550 | 728,594 | | LaDawn Yesho | 2023 | 336,154 | — | 152,193 | 110,160 | 15,900 | 20,837 | 635,243 | | Executive Vice President and Chief Risk Officer | 2022 | 312,115 | — | 142,453 | 215,460 | — | 9,524 | 679,552 | | | 2021 | 266,750 | 25,000 | 106,512 | 102,692 | — | 8,682 | 509,636 |
Summary Compensation Table
| (1) Salaries for 2021 reflect mid-year adjustments for Messrs. Kochvar, Antolik, Drahnak, and Ms. Yesho. |
Summary Compensation Table
| (2) This column represents cash bonuses that were paid to NEOs in 2022. Messrs. McComish and Antolik were paid bonuses of $300,000 and $75,000 as provided in their respective employment agreements. Mr. Antolik also was paid a supplemental payment of $25,000 per month ($125,000) for his role as Interim CEO. Bonuses were paid to Ms. Yesho and Mr. Drahnak in recognition for their key roles in 2021 for a transitional year in S&T leadership. |
Summary Compensation Table
| (3) Amounts reflect the total grant date fair value of awards recognized for financial statement reporting purposes for the fiscal years ended December 31, 2021, 2022 and 2023, in accordance with FASB ASC Topic 718 (disregarding any forfeiture assumptions). Assumptions used in the calculation of these amounts are included for 2023 in Note 21 to the audited financial statements for the fiscal year ended December 31, 2023, included in the Form 10-K Note 21 for the year ended December 31, 2022. Performance restricted stock units granted in 2023 may pay out up to 195% of the target award, which would have amounted to the grant date fair values listed as the maximum total grant date fair value for each named executive officer as follows: Mr. McComish, $1,076,497; Mr. Kochvar, $314,330; Mr. Antolik, $358,863; Mr. Drahnak, $200,956; and Ms. Yesho, $195,204. |
Summary Compensation Table
| (4) This column includes the incentive payments resulting from the MIPs for 2021, 2022, and 2023. |
Summary Compensation Table
| (5) This column shows the aggregate year-to-year change in the actuarial present value of the NEO’s accrued pension benefit under all qualified and non-qualified defined benefit plans based on the assumptions used for ASC 715 “Compensation – Retirement Benefits” accounting purposes at each measurement date. As such, the change reflects changes in value due to an increase or decrease in the ASC 715 discount rate, as well as changes in the mortality assumption. The change in pension value during 2022 for Messrs. Kochvar, Antolik, Drahnak, and Ms. Yesho are negative $419,700, negative $588,800, negative $410,500, and negative $99,000, respectively. The change in pension value during 2021 for Messrs. Kochvar, Antolik, Drahnak, and Ms. Yesho are negative $17,000, negative $55,600, negative $45,500, and negative $13,500, respectively (negative amounts are not reflected in the amounts disclosed above or below). Ms. Yesho is not a participant in the Retirement Plan. Her change in present value amounts shown reflect her nonqualified benefit payable from the S&T Bancorp, Inc. Retirement Make-Up Plan. |
Summary Compensation Table
| (6) The compensation represented by the amounts for 2023 as set forth in the All Other Compensation column for the NEOs is detailed in the following table. |
Grants of Plan-Based Awards for Fiscal Year 2023
Grants of Plan-Based Awards for Fiscal Year 2023
Grants of Plan-Based Awards for Fiscal Year 2023
| Name | Grant Date | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | | | Estimated Possible Payouts Under Equity Incentive Plan Awards(2) | | | All Other Stock Awards: Number of Shares of Stock or Units (#)(3) | Grant Date Fair Value of Stock and Awards ($)(4) | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | Christopher J. McComish | 4/1/2023 | 125,625 | 502,500 | 879,375 | | | | | | | | 4/1/2023 | | | | 5,802 | 11,603 | 17,405 | 11,603 | 839,303 | | Mark Kochvar | 4/1/2023 | 54,750 | 219,000 | 383,250 | | | | | | | | 4/1/2023 | | | | 1,694 | 3,388 | 5,082 | 3,388 | 245,071 | | David G. Antolik | 4/1/2023 | 62,500 | 250,000 | 437,500 | | | | | | | | 4/1/2023 | | | | 1,934 | 3,868 | 5,802 | 3,868 | 279,792 | | Stephen A. Drahnak | 4/1/2023 | 35,000 | 140,000 | 245,000 | | | | | | | | 4/1/2023 | | | | 1,083 | 2,166 | 3,249 | 2,166 | 156,678 | | LaDawn D. Yesho | 4/1/2023 | 34,000 | 136,000 | 238,000 | | | | | | | | 4/1/2023 | | | | 1,052 | 2,104 | 3,156 | 2,104 | 152,193 |
Grants of Plan-Based Awards for Fiscal Year 2023
| (1) These columns represent the range of estimated payouts under the 2023 MIP. For the MIP, the payments the NEOs earned were entirely based on the corporate component being the performance measure affecting the range of estimated payouts. For a more detailed description of the 2023 continued employment and MIP see “Management Incentive Plan Awards” in the “Compensation Discussion and Analysis” on page 38. |
Grants of Plan-Based Awards for Fiscal Year 2023
| (2) On April 1, 2023, the Compensation Committee granted restricted stock units to the NEOs at a grant price of $31.45, which was the closing price of S&T Common Stock on the grant date. The number of units granted to the NEOs was their target opportunity multiplied by their respective salaries and then divided by $32.3202, which was the average of the high and low prices of S&T Common Stock over the 10-day trading period ending on the grant date. The grants were in accordance with the 2023 LTIP, pursuant to the Compensation Committee’s authority under the 2021 Plan. For a more detailed description of the 2023 LTIP, see “Long-Term Incentive Plan Awards” in the “Compensation Discussion and Analysis” on page 40. These columns represent the performance based shares granted, which are earned based on S&T’s ROAE and TSR performance measured against the Performance Peer Banks over a three-year period, 2023 through 2025. The range of estimated payouts are denominated in the number of shares that may be earned under the performance award. |
Grants of Plan-Based Awards for Fiscal Year 2023
| (3) This column represents the time-based shares granted under the 2023 LTIP that will be earned based on remaining with S&T for three years. |
Grants of Plan-Based Awards for Fiscal Year 2023
| (4) This column presents the total grant date fair value of grant under the 2023 LTIP recognized for financial statement reporting purposes for the fiscal years ended December 31, 2023, in accordance with FASB ASC Topic 718 (disregarding any forfeiture assumptions). Assumptions used in the calculation of these amounts are included for 2023 in Note 21 to the audited financial statements for the fiscal year ended December 31, 2023, included in the Form 10-K for the year ended December 31, 2023. This grant date fair value is in the Summary Compensation Table for fiscal year 2023 in the Stock Awards column. |
Outstanding Equity Awards at 2023 Fiscal Year End
Outstanding Equity Awards at 2023 Fiscal Year End The following table sets forth information regarding the number and value of unvested shares of restricted stock outstanding on December 31, 2023 for our NEOs. The market value of the stock awards is based on the closing price of S&T Common Stock on December 29, 2023, the last business day of the year, which was $33.42.
Outstanding Equity Awards at 2023 Fiscal Year End
| Name | Number of Shares or Units of Stock That Have Not Vested (#) (1) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (2) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Christopher J. McComish | | | | | | Granted 04/01/2022 | 8,311 | 277,754 | 12,404 | 808,356 | | Granted 04/01/2023 | 11,603 | 387,772 | 11,603 | 756,156 | | Mark Kochvar | | | | | | Granted 04/01/2021 | 940 | 31,415 | 1,880 | 62,830 | | Granted 04/01/2022 | 2,106 | 70,383 | 3,142 | 204,761 | | Granted 04/01/2023 | 3,388 | 113,227 | 3,388 | 220,793 | | David G. Antolik | | | | | | Granted 04/01/2021 | 1,265 | 42,276 | 2,531 | 84,586 | | Granted 04/01/2022 | 4,535 | 151,560 | 6,768 | 441,064 | | Granted 04/01/2023 | 3,868 | 129,269 | 3,868 | 252,074 | | Stephen A. Drahnak | | | | | | Granted 04/01/2021 | 516 | 17,245 | 1,031 | 34,456 | | Granted 04/01/2021(3) | 1,106 | 36,963 | 0 | 0 | | Granted 11/08/2021(3) | 850 | 28,407 | 0 | 0 | | Granted 04/01/2022 | 1,397 | 46,688 | 2,084 | 135,812 | | Granted 04/01/2023 | 2,166 | 72,388 | 2,166 | 141,156 | | LaDawn D. Yesho | | | | | | Granted 04/01/2021 | 474 | 15,841 | 948 | 31,682 | | Granted 04/01/2021(3) | 340 | 11,363 | 0 | 0 | | Granted 04/01/2022 | 1,397 | 46,688 | 2,084 | 135,812 | | Granted 04/01/2023 | 2,104 | 70,316 | 2,104 | 137,116 |
Outstanding Equity Awards at 2023 Fiscal Year End
| (1) The S&T Board awarded the restricted shares of Common Stock on April 1, 2021, and restricted stock units on April 1, 2022 and April 1, 2023 pursuant to the 2021, 2022, and 2023 LTIPs, respectively. This column presents the restricted shares in the LTIP awards issued in 2021 that vest 50% on the second and third anniversaries, respectively and units issued on April 1, 2022 and 2023 that vest 33%, 33%, 34% on each of the three-year anniversaries. The second tranche remains to vest on the third anniversary of the 2021 award. All tranches remain to vest on each one-year anniversary of the 2023 awards. The second and third tranches remain to vest on the second and third anniversary of the 2022 award. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (2) The column presents the number of shares in the aforementioned LTIP awards that are subject to vesting on the third anniversary of their respective grant dates, based on achievement of corporate performance goals. The number of shares for the 2021 grant is reported at the Target level of performance. The number of shares for the 2022 and 2023 grants are reported at the maximum level of performance. |
Outstanding Equity Awards at 2023 Fiscal Year End
| (3) Time based shares issued to Mr. Drahnak (3,250 shares and 2,500 shares) and Ms. Yesho (1,000 shares) on April 1, 2021 and November 8, 2021 respectively vest at 33%, 33% and 34% over a three-year vesting period. |
Stock Vested in Fiscal Year 2023
Stock Vested in Fiscal Year 2023 The following table sets forth information regarding the number and value of restricted stock awards that vested during 2023 for our NEOs.
Stock Vested in Fiscal Year 2023
| Name | Number or Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($)(2) | | Christopher J. McComish(3) | 0 | 0 | | Mark Kochvar | 8,294 | 235,246 | | David G. Antolik | 20,339 | 579,369 | | Stephen A. Drahnak | 3,742 | 114,155 | | LaDawn D. Yesho | 2,081 | 65,447 |
Stock Vested in Fiscal Year 2023
| (1) Shares acquired are representative of the shares vested before shares were forfeited for taxes withheld. The time-based shares of restricted S&T stock granted under the 2020 LTIP on April 1, 2020 vested 50% on April 1, 2022. The remaining 50% vested on April 1, 2023. The time-based shares of restricted units granted under the 2022 LTIP on April 1, 2022 vested 33% on April 1, 2023. The performance-based shares granted under the 2020 LTIP were forfeited on April 1, 2023. The shares of restricted S&T stock granted under the 2020 LTIP were divided evenly between performance and time-based shares. The time-based shares of restricted S&T stock granted under the 2021 LTIP vested 50% on April 1, 2023. |
Stock Vested in Fiscal Year 2023
| (2) The value realized on vesting is based on the price of S&T Common Stock on the close of the market on the date of the vesting. |
Stock Vested in Fiscal Year 2023
| (3) On December 23, 2022, Mr. McComish elected to defer his vesting of all units issued beginning in 2023 until a future date. Had his awards otherwise vested, he would have acquired 4,093 shares with a value of $128,735. |
Pension Benefits
Pension Benefits
Pension Benefits
| Name | Plan Name | Number of years of Credited Service (#) | Present Value of Accumulated Benefit ($) | Payments During Last Fiscal Year ($) | | Christopher J. McComish (1) | Employees’ Retirement Plan of S&T Bank | 0 | $— | — | | | S&T Bancorp, Inc. Supplemental Savings and Make-up Plan | 0 | $— | — | | Mark Kochvar | Employees’ Retirement Plan of S&T Bank | 24 | $1,084,300 | — | | | S&T Bancorp, Inc. Supplemental Savings and Make-up Plan | 24 | $345,800 | — | | David G. Antolik | Employees’ Retirement Plan of S&T Bank | 26 | $950,600 | — | | | S&T Bancorp, Inc. Supplemental Savings and Make-up Plan | 26 | $442,600 | — | | Stephen A. Drahnak | Employees’ Retirement Plan of S&T Bank | 24 | $663,200 | — | | | S&T Bancorp, Inc. Supplemental Savings and Make-up Plan | 24 | $95,200 | — | | LaDawn D. Yesho (1) | Employees’ Retirement Plan of S&T Bank | 0 | $— | — | | | S&T Bancorp, Inc. Supplemental Savings and Make-up Plan | 7 | $127,100 | — |
Pension Benefits
| (1) Mr. McComish and Ms. Yesho were hired after January 1, 2008 and are not eligible for any qualified pension benefits. |
Pension Benefits
The present values shown above are based on benefits earned as of December 31, 2023 under the terms of the Employees’ Retirement Plan of S&T Bank (the “Retirement Plan”) and the S&T Bancorp, Inc. Supplemental Savings and Make-up Plan (the “Nonqualified Plan”) as summarized below. Present values are determined in accordance with the assumptions used for purposes of measuring S&T Bank’s pension obligations under ASC 715 as of December 31, 2023, including a discount rate of 5.03%, with the exception that benefit payments are assumed to commence at age 62, the earliest age at which unreduced benefits are payable. Mr. Kochvar was eligible to retire as of December 31, 2023 and receive 100.00% of his benefits. Mr. Antolik was eligible to retire as of December 31, 2023 and receive 75.00% of his benefits based on the reduction for early retirement described below. Ms. Yesho is not a participant in the Retirement Plan. Her present value shown reflects her nonqualified benefit payable from the S&T Bancorp, Inc. Retirement Make-Up Plan. On Jan. 25, 2016, the Board of Directors approved an amendment to freeze benefit accruals under the Retirement Plan and Nonqualified Plan effective March 31, 2016. This change resulted in no additional benefits being earned by participants in those plans based on service or pay after March 31, 2016.
Employees’ Retirement Plan of S&T Bank
Employees’ Retirement Plan of S&T Bank The Employees’ Retirement Plan of S&T Bank (“Plan”) is a defined benefit pension plan that covers substantially all employees hired prior to 2008. The Plan provides benefits that are based on years of service and compensation. Benefits payable under the Plan at normal retirement, age 65, are determined under the following formula. 1.0% of Average Final Compensation up to Covered Compensation, times Benefit Service Plus 1.5% of Average Final Compensation in excess of Covered Compensation, times Benefit Service For purposes of determining the normal retirement benefit, the terms used above have the following meanings:
Employees’ Retirement Plan of S&T Bank
| • | Average Final Compensation is the average compensation received during the highest 5 consecutive years out of the last 10 years prior to retirement or termination of employment. Compensation generally means total cash remuneration determined before reductions for employee contributions for 401(k) or other pre-tax benefits, but does not include amounts deferred under the S&T Bancorp, Inc. Supplemental Savings and Make-up Plan. Compensation is limited each year as required by Federal law. Average Final Compensation was frozen effective March 31, 2016. |
Employees’ Retirement Plan of S&T Bank
| • | Covered Compensation is the average of the Social Security taxable wage bases in effect for each year in the 35-year period ending with the calendar year in which a participant retires or terminates employment. Social Security Covered Compensation used to determine the normal retirement benefit was frozen effective March 31, 2016. |
Employees’ Retirement Plan of S&T Bank
| • | Benefit Service generally means an employee’s period of employment with S&T Bank after attainment of age 21. Benefit Service was frozen effective March 31, 2016. |
Employees’ Retirement Plan of S&T Bank
Participants’ benefits under the Plan are 100% vested after completion of five years of service. Participants who terminate employment prior to age 55 with a vested benefit are entitled to receive their full accrued benefit at normal retirement, age 65, or upon election, can receive actuarially reduced benefits as early as age 55. Participants who terminate employment after age 55 with at least 10 years of service are eligible to receive early retirement benefits under the Plan. For participants who met certain age and service requirements as of December 31, 2007, early retirement benefits are reduced 5/12 of 1% for each month by which the date benefit payments commence precedes age 62. For participants who did not meet these requirements, early retirement benefits are reduced 5/12 of 1% for each month by which the date benefit payments commence precedes age 65. Accrued benefits under the Plan are payable in the form of a ten-year certain and life annuity that provides equal monthly payments for the participant’s life with a minimum of 120 monthly payments guaranteed. Married participants must receive their benefit in the form of a 50% joint and survivor annuity with 120 monthly payments guaranteed unless their spouse consents to a different form of a payment. A 50% joint and survivor annuity provides a reduced monthly payment for the participant’s life with 50% of the payment continuing for the spouse’s life following the participant’s death. Various optional annuity forms of payment are available under the Plan, including a single lump sum payment. All forms of payment are actuarially equivalent in value.
Nonqualified Deferred Compensation
Nonqualified Deferred Compensation The following table provides information with respect to the Nonqualified Plan and the NEOs. The amounts shown include compensation earned and deferred in prior years, and earnings on, or distributions of, such amounts.
Nonqualified Deferred Compensation
| Name | Executive Contributions in Last Fiscal Year ($) | Registrant Contributions in Last Fiscal Year ($)(1) | RSU Defered Contributions in Last Fiscal Year ($) | Aggregate Earnings in Last Fiscal Year ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last Fiscal Year End ($) | | Christopher J. McComish | 102,342 | 44,775 | 136,788 | 26,836 | — | 358,204 | | Mark Kochvar | — | — | — | 114,312 | — | 549,801 | | David G. Antolik | 62,750 | 21,963 | — | 212,889 | — | 1,153,618 | | Stephen A. Drahnak | 26,817 | 9,386 | — | 5,519 | (195,601) | 60,260 | | LaDawn D. Yesho | 32,661 | 11,431 | — | 87,893 | — | 466,134 |
Nonqualified Deferred Compensation
| (1) The amounts in this column have been included in the “All Other Compensation” column of the Summary Compensation Table on page 45. |
Nonqualified Deferred Compensation
The Nonqualified Plan offers certain management employees, including the NEOs, the opportunity to continue to defer income on a tax deferred basis that exceeds annual contribution or compensation limits for qualified plans. In addition, the Nonqualified Plan can be used by highly-compensated employees who are limited to the salary deferral limit under the Thrift Plan. The employee may elect to defer a percentage of compensation from each payroll under the Supplemental Savings provision. The employee may also elect to contribute at the same deferral rate as for the Thrift Plan after reaching a contribution or compensation limit under the make-up provision. S&T Bank makes employer matching and year end profit sharing contributions to the Nonqualified Plan that cannot be made to the qualified plans due to the aforementioned limits. The match is 3.5% of the deferral amount, except the match on deferrals under the make-up provision, which are matched 100% of the first 1% of the employee’s eligible compensation and 50% of the next 5% of the employee’s eligible compensation, up to 3.5% of the employee’s eligible compensation. The year end profit sharing bonus is at the same percentage as for the Thrift Plan and applies to eligible compensation that exceeds the compensation limit for qualified plans. The participants may elect the allocation percentages for employee deferrals and employer contributions into two large capitalization mutual funds, a balanced fund and a money market mutual fund in a Rabbi Trust. The Thrift Plan Committee at S&T Bank determines the investment vehicles in the Rabbi Trust, which currently are Vanguard 500 Index Fund Admiral, American Funds Fundamental Investors Fund Class R5, Dodge & Cox Balanced Fund and Vanguard Treasury Money Market Investor Shares. As described earlier, distributions from the Nonqualified Plan are in accordance with the participant’s distribution election. The Nonqualified Plan is subject to the provisions of Section 409A of the Code.
CEO Pay Ratio
CEO Pay Ratio For 2023, S&T selected December 29, 2023 as the determination date for identifying the median employee under Item 402(u) of Regulation S-K. Year-to-date taxable wages paid from January 1, 2023 to December 31, 2023 for all employees employed as of the determination date, with the exception of Mr. McComish, were listed from lowest to highest. This period captured all incentive payments for the tax year as well as the vesting of equity awards, as applicable. Wages of newly hired permanent employees were adjusted to represent wages for the entire measurement period. Once the data was complete, the median employee was identified, and total compensation for the median employee was calculated according to Item 401(c). Mr. McComish’s annual total compensation for 2023 was estimated to be $2,089,129. This amount equals Mr. McComish’s compensation as reported in the Summary Compensation Table. The median employee’s compensation was $50,456 producing a ratio of 41.4. In accordance with rules adopted by the Securities and Exchange Commission pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, we provide the following disclosure regarding executive compensation for our principal executive officers (“PEOs”) and Non-PEO NEOs and Company performance for the fiscal years listed below. The Compensation Committee did not consider the pay versus performance disclosure below in making its pay decisions for any of the years shown.
CEO Pay Ratio
| Year | Summary Compensation Table Total for PEO 1¹ ($) | Summary Compensation Table Total for PEO 2¹ ($) | Summary Compensation Table Total for PEO 3¹ ($) | Compensation Actually Paid to PEO 1 1,2,3 ($) | Compensation Actually Paid to PEO 2 1,2,3 ($) | Compensation Actually Paid to PEO 3 1,2,3 ($) | Average Summary Compensation Table Total for Non-PEO NEOs 1 ($) | Average Compensation Actually Paid to Non-PEO NEOs 1,2,3 ($) | Value of Initial Fixed $100 Investment based on: 4 | | Net Income ($ Millions) | Return on Average Equity 5 | | | | | | | | | | | TSR ($) | Peer Group TSR ($) | | | | 2023 | — | — | 2,089,129 | — | — | 2,211,359 | 848,462 | 763,056 | 97.79 | 106.87 | 144.8 | 11.8% | | 2022 | — | — | 2,508,806 | — | — | 2,437,641 | 941,388 | 997,835 | 95.79 | 110.67 | 135.5 | 11.5% | | 2021 | 823,834 | 1,215,680 | 887,244 | 681,430 | 1,461,391 | 902,948 | 621,526 | 616,621 | 85.06 | 132.19 | 110.3 | 9.3% | | 2020 | 1,700,525 | — | — | 474,364 | — | — | 961,977 | 600,989 | 64.60 | 92.50 | 21.0 | 1.8% |
CEO Pay Ratio
| 1. | Todd D. Brice (“PEO 1”) was our PEO from January 2019 to March 2021. David G. Antolik (“PEO 2”) was our interim PEO from March 2021 to August 2021. Christopher J. McComish (“PEO 3”) has been our PEO since August 2021. The individuals comprising the Non-PEO NEOs for each year presented are listed below. |
CEO Pay Ratio
| 2020 | 2021 | 2022 — 2023 | | Mark Kochvar | Mark Kochvar | Mark Kochvar | | Ernest J. Draganza | George Basara | David G. Antolik | | George Basara | Charles B. Carroll, Jr. | Stephen A. Drahnak | | David P. Ruddock | LaDawn D. Yesho | LaDawn D. Yesho | | Rebecca A. Stapleton | | | | David G. Antolik | | |
CEO Pay Ratio
| 2. | The amounts shown for Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized, or received by the Company’s NEOs. These amounts reflect the Summary Compensation Table Total with certain adjustments as described in footnote 3 below. |
CEO Pay Ratio
| 3. | Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEOs and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards column are the totals from the Stock Awards column set forth in the Summary Compensation Table. Amounts in the Exclusion of Change in Pension Value column reflect the amounts attributable to the Change in Pension Value reported in the Summary Compensation Table. Amounts in the Inclusion of Pension Service Cost are based on the service cost for services rendered during the listed year and any prior service cost related to any plan amendment or initiation. (Because the pension plans are frozen there is no inclusion for Pension Service Cost.) |
CEO Pay Ratio
| Year | Summary Compensation Table Total for PEO 3 ($) | Exclusion of Change in Pension Value for PEO 3 ($) | Exclusion of Stock Awards for PEO 3 ($) | Inclusion of Pension Service Cost for PEO 3 ($) | Inclusion of Equity Values for PEO 3 ($) | Compensation Actually Paid to PEO 3 ($) | | 2023 | 2,089,129 | — | (839,303) | — | 961,533 | 2,211,359 |
CEO Pay Ratio
| Year | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Exclusion of Change in Pension Value for Non-PEO NEOs ($) | Average Exclusion of Stock Awards for Non-PEO NEOs ($) | Average Inclusion of Pension Service Cost for Non-PEO NEOs ($) | Average Inclusion of Equity Values for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs ($) | | 2023 | 848,462 | (62,925) | (196,968) | — | 174,487 | 763,056 |
CEO Pay Ratio
56 | The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables:
CEO Pay Ratio
| Year | Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for PEO 3 ($) | Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for PEO 3 ($) | Vesting- Date Fair Value of Equity Awards Granted During Year that Vested During Year for PEO 3 ($) | Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for PEO 3 ($) | Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for PEO 3 ($) | Value of Dividends or Other Earnings Paid on Equity Awards Not Otherwise Included for PEO 3 ($) | Total - Inclusion of Equity Values for PEO 3 ($) | | 2023 | 788,540 | 182,857 | — | (9,864) | — | — | 961,533 |
CEO Pay Ratio
| Year | Average Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Non-PEO NEOs ($) | Average Vesting- Date Fair Value of Equity Awards Granted During Year that Vested During Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Non-PEO NEOs ($) | Average Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Non-PEO NEOs ($) | Average Value of Dividends or Other Earnings Paid on Equity Awards Not Otherwise Included for Non-PEO NEOs ($) | Total - Average Inclusion of Equity Values for Non-PEO NEOs ($) | | 2023 | 195,827 | 18,967 | — | (40,307) | — | — | 174,487 |
CEO Pay Ratio
| 4. | The Peer Group TSR set forth in this table utilizes the NASDAQ Bank Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report for the year ended December 31, 2023. The comparison assumes $100 was invested for the period starting December 31, 2019, through the end of the listed year in the Company and in the NASDAQ Bank Index, respectively. Historical stock performance is not necessarily indicative of future stock performance. |
CEO Pay Ratio
| 5. | We determined Return on Average Equity to be the most important financial performance measure used to link Company performance to Compensation Actually Paid to our PEOs and Non-PEO NEOs in 2023. This performance measure may not have been the most important financial performance measure for prior years, and we may determine a different financial performance measure to be the most important financial performance measure in future years. |
CEO Pay Ratio
S&T Bancorp, Inc. | Non-PEO NEO Compensation Actually Paid and Company Total Shareholder Return (“TSR”) The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our Non-PEO NEOs, and the Company’s cumulative TSR over the four most recently completed fiscal years. 58 | Relationship Between Company TSR and Peer Group TSR The following chart compares our cumulative TSR over the four most recently completed fiscal years to that of the NASDAQ Bank Index over the same period. S&T Bancorp, Inc. | Non-PEO NEO Compensation Actually Paid and Net Income The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our Non-PEO NEOs, and our net income during the four most recently completed fiscal years. 60 | Non-PEO NEO Compensation Actually Paid and Return on Average Equity The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our Non-PEO NEOs, and our Return on Average Equity during the four most recently completed fiscal years. S&T Bancorp, Inc. | Tabular List of Most Important Financial Performance Measures The following table presents the financial performance measures that the Company considers to have been the most important in linking Compensation Actually Paid to our PEOs and Non-PEO NEOs for 2023 to Company performance. The measures in this table are not ranked.
CEO Pay Ratio
| Return on Average Equity | | EPS | | Relative TSR |
CEO Pay Ratio
62 |