Bank Directors Seminar, Coeur d'Alene, ID, September 15-17, 2019

CEO SUCCESSION

Situation:  You are a director of a successful community bank, with $535 million of assets, 14 branches, online presence, operations in 3 states, CAMELS rating of 2 with management rating of 1  Your CEO has led the bank for 14 years, well regarded, is a frequent industry speaker, and 63 years old  You are called at 2:30 on Friday prior to your nonrefundable vacation to Italy and informed that the president collapsed at her desk and EMT has arrived  As chair of compensation committee, what do you do?

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SUCCESSION - MODELS

CEO Driven • CEO manages process • CEO selects successor • CEO informs board • Board consents

Collaborative • CEO drives, board actively participates • CEO teams with board or committee chair • Board decides

Board Driven • Board drives, CEO actively participates • Board develops criteria • CEO develops candidates and information • Board decides

Crisis • CEO unavailable (e.g., health) • Board or committee chair drives process • Compressed time • Usually board unprepared

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