Marc Yrsha
About Marc Yrsha
Senior Executive Vice President and Chief Banking Officer at Arrow Financial Corporation (AROW). Joined the company in 2015; oversees Retail Banking (deposits and lending), business development, consumer payments, business services, municipal banking, small business and retail lending, plus Wealth Management and Marketing. Graduate of Castleton University (VT) and the Adirondack Regional Chamber of Commerce’s Leadership Adirondack Program; active in community leadership roles on local boards . Company performance underpinning his incentive framework: 2024 net income $29.7M and EPS $1.77; ROE 7.72%, ROA 0.70%; loan growth +$185M (+5.8%), deposits $3.8B (+3.8%), NIM 2.72% (vs. 2.65% in 2023) . Pay-versus-performance TSR framework shows $100 invested Dec 31, 2019 grew to $103.22 by 2024 vs peer ABA Nasdaq Community Bank Index at $108.39 .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Arrow Financial Corporation (Arrow Bank) | Senior EVP, Chief Banking Officer | 2015–present | Oversees strategic direction of retail deposits/lending; business services; municipal banking; small business and retail lending; Wealth Management; Marketing |
| Large regional and community banks (within Arrow footprint) | Retail leadership; retail and commercial lending | Pre-2015 | Customer growth and lending operations experience leveraged in current role |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Various local boards | Board leader | n/a | Community leadership roles; relationship network in Arrow’s markets |
Fixed Compensation
| Metric | 2024 | 2025 |
|---|---|---|
| Base Salary ($) | $325,000 | $375,950 (↑15.7% YoY) |
| Target STIP % of Base | 40% | 40% |
| Target STIP Amount ($) | $130,000 | $150,380 |
| Actual STIP Paid ($) | $120,250 (92.5% of target; paid Feb 2025) | n/a |
Performance Compensation
2024 Short-Term Incentive Plan (STIP) – Company Metric Framework
| Metric | Weighting | Target | Actual | Result Category |
|---|---|---|---|---|
| Earnings Per Share (EPS) | 80% | $2.35 | $2.05 | Between Threshold & Target |
| Tangible Book Value (TBV) Growth | 5% | 6.50% | 6.52% | Between Target & Maximum |
| Return on Assets (ROA) | 5% | 0.95% | 0.81% | Between Threshold & Target |
| Non-Performing Loans | 5% | 0.50% | 0.62% | Between Threshold & Target |
| Net Charge-Offs | 5% | 0.15% | 0.06% | Maximum |
2024 STIP outcome for Yrsha: $120,250 (92.5% of target), reflecting the above composite performance and Committee discretion .
Long-Term Incentive Plan (LTIP) – Equity Awards and Vesting
| Grant | Shares | Grant date fair value ($) | Vesting cadence |
|---|---|---|---|
| May 2024 restricted stock | 1,439 | $36,378 | 25% per year over 4 years |
| Jan 2025 restricted stock | 2,939 | $81,263 | 25% per year over 4 years |
• Program design: 2022 LTIP enables restricted stock, RSUs and stock options; annual grants typically vest equally over four years .
• Executive policies: Clawback policy maintained; hedging/pledging policies prohibit Section 16 officers from hedging Company stock; stock ownership policy applies to NEOs with required holdings scaled to salary .
Equity Ownership & Alignment
Beneficial Ownership (as of April 7, 2025)
| Holder | Shares Owned | Restricted Shares Vesting ≤60 Days | Options Exercisable ≤60 Days | Total Beneficial Ownership | % of Shares Outstanding |
|---|---|---|---|---|---|
| Marc J. Yrsha | 5,494 | 360 | 5,074 | 10,928 | <1% |
Outstanding Equity Positions (12/31/2024)
| Exercisable | Unexercisable | Strike ($) | Expiration |
|---|---|---|---|
| 845 | — | 31.34 | 1/29/2030 |
| 819 | 274 | 27.04 | 1/27/2031 |
| 1,061 | 1,061 | 33.78 | 1/26/2032 |
| 773 | 2,317 | 31.47 | 2/1/2033 |
• Unvested restricted stock at YE 2024: 1,439 shares, market value $41,314 .
• Company-level alignment: As of Sept 30, 2025, management ~0.5%, directors ~1%, employees ~5% ownership; ~55K unvested restricted stock company-wide; YTD 2025 buybacks ~$9.9M; 3Q25 insider net purchases 22K shares/$600K .
• Policies: Insider trading policy with blackout windows and Rule 10b5-1 accommodations; hedging/pledging restrictions maintained .
• Compliance note: Yrsha filed one late Form 3 on executive officer appointment (initial holdings) .
Employment Terms
Contract and Incentives
| Term | Detail |
|---|---|
| Agreement term | 2 years effective Feb 1, 2025 |
| Base salary | $375,950 (2025) |
| Target bonus | 40% of base salary |
| LTIP eligibility | Restricted stock under 2022 LTIP; standard 4-year ratable vesting |
| Stock ownership policy | NEOs required to own specific amounts scaled to salary |
| Clawback; hedging/pledging | Clawback maintained; hedging/pledging policies prohibit hedging by Section 16 officers |
| Change-in-control | Double-trigger; within 12 months of CoC, 2× (base + target bonus) paid over 2 years (CEO 3×); all outstanding equity awards vest upon CoC |
| Non-compete & non-solicit | 2-year non-compete in any NY county where Arrow operates; 2-year non-solicit of customers/employees; confidentiality and non-disparagement covenants |
Potential Payments (Scenario analysis at 12/31/2024)
| Scenario | Cash Compensation ($) | Stock Options ($) | Restricted Stock ($) | SERP ESOP ($) | Health & Welfare ($) | Total ($) |
|---|---|---|---|---|---|---|
| Involuntary termination without cause / Good Reason | 352,083 | — | — | 6,288 | — | 358,371 |
| Change of Control (post-termination) | 890,500 | 458 | 41,314 | 6,288 | 50,196 | 988,756 |
| Retirement | — | 458 | 41,314 | 6,288 | — | 48,060 |
| Death or Disability | — | — | 41,314 | 6,288 | — | 48,060 |
Company does not maintain a broad executive severance plan; severance economics principally arise from employment agreements and SERP participation decisions .
Compensation Structure Analysis
- Shift toward restricted stock: LTIP awards of 1,439 shares in May 2024 ($36,378) and 2,939 shares in Jan 2025 ($81,263) with 4-year ratable vesting, increasing equity-aligned pay and creating scheduled vesting events through 2028–2029 .
- Increased guaranteed pay: 2025 base salary up 15.7% to $375,950 alongside higher 2025 restricted grant value, signaling retention emphasis and role criticality .
- Balanced STIP framework: Heavy EPS weighting (80%) complemented by TBV growth, ROA, credit metrics; 2024 payout at 92.5% of target reflects mixed earnings vs strong credit/TBV outcomes .
- Governance protections: Double-trigger CoC, equity acceleration on CoC, clawback, no tax gross-ups, no option repricing; Say-on-Pay support at 89% in 2024 .
Related Party & Risk Indicators
- Legal proceedings: Securities class action settled (court-approved Feb 13, 2025; immaterial impact), derivative claim settlement-in-principle with governance adjustments; context for risk and controls evolution .
- Controls history: Prior material weaknesses (2022–2023) related to oversight and risk assessment during core system conversion; auditor transition to Crowe with independence and fee disclosures .
- Section 16 reporting: Yrsha filed one late Form 3 on appointment; administrative timeliness to monitor .
- Hedging/pledging: Prohibited for Section 16 officers; alignment maintained via ownership policies .
Compensation Peer Group & Shareholder Feedback
- Benchmarking: Peer set includes NY and regional banks (e.g., Tompkins Financial, Trustco, OceanFirst, NBT), used for competitive reference; periodic independent reviews by Pearl Meyer .
- Say-on-Pay: 2024 approval 89%; Board intends annual advisory votes; program emphasizes conservative, balanced risk posture .
Expertise & Qualifications
- Education: Castleton University; Leadership Adirondack program graduate .
- Banking competencies: Retail deposit/lending, payments, small business lending, municipal banking, wealth management, marketing; regional market knowledge and community engagement .
Equity Ownership & Alignment
- Ownership guidelines apply to NEOs; unvested equity excluded from guideline calculus; insider trading policy governs blackout periods and Rule 10b5-1 plans .
- Company ownership mix: Management ~0.5%, directors ~1%, employees ~5% as of Sept 30, 2025; continued buybacks and insider net purchases in 3Q25 .
Investment Implications
- Rising fixed pay and increased restricted stock suggest retention priority for a growth and customer-facing leader; vesting schedules imply periodic supply that could create modest selling pressure on vest dates if not retained, though insider policies and guideline requirements mitigate opportunistic selling .
- Incentive alignment: High EPS weighting plus TBV/credit metrics anchors pay to shareholder value and risk discipline; 2024 payout below target reinforces pay-for-performance governance .
- Protective terms: Double-trigger CoC at 2× base+target and equity acceleration provide competitive protections without tax gross-ups or option repricing; clawback and hedging/pledging prohibitions enhance alignment .
- Ownership footprint: Yrsha’s beneficial stake (10,928 shares including near-term vesting/exercisable) is modest; broader management/director accumulation and buybacks support alignment and sentiment into 2025 .