Officer performance evaluations

​We use a semi-annual incentive on top of base salary that measures a variety of components including market net income vs. budget, market efficiency ratio vs. budget, compliance and audit performance for each half of the year as applicable, (if a lender) loan growth compared to budgeted growth, portfolio performance characteristics like past due percentages and technical exceptions vs. our internal standards. Each component has a possible percentage contribution to the max incentive available semi-annually. Net income and efficiency are set at specific level equally for officers on a semi-annual incentive. Other components can be added or deleted or have tailored percentages as determined by executive management or the CEO to adjust or incent improved performance.

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Brett Mills
Executive VP & CFO
First American Bank
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Original Message:
Sent: 07-10-2018 18:54
From: Andrew Hancock
Subject: Officer performance evaluations

​For 45 years our company included the profitability of the market an officer worked as a component of their individual performance score. With the changes imposed through Dodd-Frank this component has been removed from our evaluations and I believe it has caused a mismatch in officer performance scores and the most important performance goal of the market,income. I was wondering if anyone had come up with a good way to incorporate aspects of profitability into their officer performance evaluations? ( i.e efficiency ratios or net interest margins)

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Andrew Hancock
Regional President
FirstBank
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