Alberto J. Paracchini
About Alberto J. Paracchini
Alberto J. Paracchini, 54, is President and Director of Byline Bancorp, Inc. and CEO/President and Director of Byline Bank, roles he has held since June 2013; he currently serves on the Risk Committee of the Board . He previously was a Principal at BXM Holdings, EVP at Midwest Bank & Trust, and spent 16 years at Popular, Inc. in senior finance/operations roles (including CFO roles at Popular Financial Holdings and E‑Loan) and head of operations/technology at Banco Popular North America; he holds a BA from Marquette and an MBA (with honors) from the University of Chicago Booth School of Business . In 2024, Byline delivered net income of $120.8M, positive operating leverage with revenues up 5.2%, 2.05% pre‑tax pre‑provision ROAA (non‑GAAP), and a 52.45% efficiency ratio, with cumulative TSR (base 12/31/2019=100) at 158.95 vs 111.52 for the KRX peer index in 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| BXM Holdings, Inc. | Principal | — | Community bank investment specialist; recapitalization and M&A experience . |
| Midwest Bank & Trust | Executive Vice President | — | Senior operating leadership at a regional bank . |
| Popular, Inc. (incl. Popular Financial Holdings, E‑Loan, Banco Popular North America) | Multiple senior roles (President/CFO, CFO, Head of Ops/Tech) | 16 years | Led finance, operations, technology; broad retail/mortgage banking expertise . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Kemper Corporation | Director | — | Public company board experience . |
| Junior Achievement Chicago | Director | — | Non‑profit board . |
| Scale Link (CDFI) | Director | — | Community development finance expertise . |
| Cook County Council of Economic Advisors | Member | — | Public policy/economic advisory engagement . |
| Economic Club of Chicago | Member | — | Business leadership forum . |
Fixed Compensation
| Component (FY 2024 unless noted) | Amount | Notes |
|---|---|---|
| Base Salary rate (2024) | $640,000 | 2024 rate (from CD&A base salary table) . |
| Salary earned (2024) | $635,192 | Summary Compensation Table . |
| Target Annual Bonus (% of salary) | 65% | Executive Incentive Plan target . |
| Non‑equity Incentive (actual 2024) | $457,455 | Based on corporate scorecard and individual results . |
| Perquisites and Other Benefits (2024) | $19,172 | Club dues, cell phone credits (component detail) . |
| Company 401(k) contribution (2024) | $13,800 | Company contribution . |
| Executive life insurance premium (2024) | $969 | Additional executive life insurance . |
Performance Compensation
Short‑Term Incentive (2024) – Performance Mechanics and Outcomes
| Metric | Weight | Threshold | Target | Maximum | Actual | Score |
|---|---|---|---|---|---|---|
| NPAs / Assets | 12.5% | 1.10% | 0.69% | 0.52% | 0.71% | 12.22% |
| Net Charge‑offs / Avg Loans & Leases | 12.5% | 0.65% | 0.36% | 0.26% | 0.47% | 10.13% |
| Adjusted Pre‑Tax, Pre‑Provision Net Income | 50.0% | $140,000 | $186,604 | $200,000 | $188,942 | 59.73% |
| Adjusted Efficiency Ratio | 25.0% | 56.00% | 52.56% | 51.00% | 52.24% | 30.13% |
| Total Corporate Score | 100% | — | — | — | — | 111.21% |
| Individual Performance Result (Paracchini) | 20% of STI | — | 100% | 200% | 105% | Individual factor result |
Notes:
- Paracchini’s STI was 80% corporate and 20% individual; overall bonus paid was $457,455 for 2024 .
Long‑Term Incentive Design and Grants
| LTI Element | Weight | Performance Metrics and Payout Curve | Vesting | 2024 Grant (2/22/2024) | 2025 Grant (awarded 2/2025) |
|---|---|---|---|---|---|
| Performance Shares | 50% | Core ROA and Relative TSR vs KBW KRX, equally weighted; 25th/50th/75th pct = 25%/100%/150% payout; no >100% payout on TSR if rTSR negative . | Cliff at end of 3‑year period; 2024 cycle: 1/1/2024–12/31/2026 . | Target 10,221 shares (threshold 5,111; max 15,332) . | $235,113 value (target), part of total $475,124 . |
| Time‑based Restricted Shares | 50% | N/A | 3 equal annual installments; vest on death, disability, and termination following a change‑in‑control . | 10,221 shares; grant date fair value (RSUs+PSUs at target) $421,514 . | $240,011 value (part of $475,124 total LTI) . |
- Prior PSU cycle (2022–2024) paid at 150% of target based on relative ROAA above the 75th percentile; vested 2/22/2025 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total Beneficial Ownership (as of 4/9/2025) | 207,799 shares; “<1%” of outstanding . |
| Unvested Restricted Stock included in beneficial ownership | 44,537 shares (voting power retained) . |
| Options outstanding | None disclosed for Paracchini at 12/31/2024; historical 2015 option grant previously outstanding . |
| Options exercised (2024) | 214,494 options exercised; value realized $2,586,798 (market less strike) . |
| Ownership Guidelines (Executives) | President: 3x base salary; 5‑year compliance window; must retain ≥50% of vested full‑value shares until met . |
| Hedging/Pledging | Prohibited for directors and executive officers . |
Employment Terms
| Term | Key Details |
|---|---|
| Employment Agreement (Byline Bank) | Effective 1/21/2016; 3‑year term with automatic 1‑year extensions; renewed January 2024; role: President of Byline Bancorp and President & CEO of Byline Bank; reports to Board . |
| Severance (no CIC): termination without cause or good reason resignation | 1) Unpaid EIP and pro‑rata bonus; 2) Cash over 18 months equal to 1.5x annual base salary + COBRA Benefits . |
| Severance (double‑trigger CIC within 2 years) | 1) Unpaid EIP and pro‑rata bonus; 2) Lump sum equal to 1.5x (salary + higher of last two years’ earned bonuses) + COBRA Benefits . |
| Special Change‑in‑Control (no termination) | Cash equal to 1.5x (salary + higher of last two years’ bonuses) + pro‑rata bonus (based on actual through date) . |
| Restrictive Covenants | Agreement Protecting Company Interests includes confidentiality; customer/employee non‑solicit during employment and for 18 months post‑termination . |
| Clawback | Updated 2023 to comply with SEC/NYSE; restatement‑based recovery and misconduct‑based discretionary recovery . |
| Death/Disability Benefits | EIP unpaid and pro‑rata bonus; plus (death) lump sum = 200% of base salary (cap $750k) via life policy; separate DBO Plan pays $200k to beneficiaries while employed . |
Board Governance and Dual‑Role Considerations
- Board service history: Director since 2013; current Board committees: Risk (member) .
- Board structure: CEO and Executive Chairman roles are combined (Mr. Herencia); Lead Director (Mr. del Valle) provides independent leadership; Board met 6 times in 2024; all directors attended ≥90% of meetings; annual meeting attendance expected .
- Independence: Paracchini is a management director (not independent); the Board affirms majority independence and committee independence per NYSE rules; executive sessions and committee compositions are structured to maintain independent oversight .
- Director pay: Officers who serve as directors receive no additional director compensation; non‑employee director retainers were $115,000 in 2024/2025 with additional committee/chair/Lead Director fees .
Multi‑Year Compensation (Summary Compensation Table)
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | $614,996 | $615,000 | $635,192 |
| Stock Awards (grant date fair value) | $369,004 | $408,945 | $421,514 |
| Non‑equity Incentive Plan | $357,628 | $445,309 | $457,455 |
| All Other Compensation | $29,175 | $28,769 | $33,941 |
| Total | $1,370,803 | $1,498,024 | $1,548,102 |
Company Performance Context (during current leadership)
| Metric | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|---|
| Net Income ($M) | $37.5 | $92.8 | $88.0 | $107.9 | $120.8 |
| Adjusted PTPP NI ($M) | — | — | — | $189.0 | $188.9 |
| Cumulative TSR (base=100 on 12/31/2019) | 79.77 | 143.03 | 121.94 | 127.22 | 158.95 |
| KRX Peer TSR (same base) | 87.90 | 117.08 | 106.01 | 101.77 | 111.52 |
Additional 2024 highlights: revenues up 5.2% YoY; pre‑tax pre‑provision ROAA 2.05% (non‑GAAP); efficiency ratio 52.45% .
Say‑on‑Pay (2025): For 34,625,475; Against 1,033,093; Abstain 423,146; Broker non‑votes 2,781,049 .
Compensation Structure Analysis
- Mix and risk: Balanced between cash and equity with 50% of LTI performance‑based (ROA and rTSR vs KRX); no stock options granted since 2015; clawback policy in place; hedging/pledging prohibited .
- Targets and discretion: STI metrics diversified (asset quality, profitability, efficiency), with corporate score at 111.21%; individual performance modifier for Paracchini at 105% .
- Peer benchmarking: Compensation benchmarked to a 23‑company regional bank peer set; peer group reviewed/updated for 2025 decisions .
- Shareholder alignment: Executive ownership guideline (3x salary for President); vesting and CIC terms avoid single‑trigger windfalls; no golden parachute tax gross‑ups .
Risk Indicators & Red Flags
- Special CIC provision: Provides payout even without termination (1.5x salary + bonus baseline + pro‑rata bonus), which can be shareholder‑unfriendly if used liberally, though it is disclosed and bounded .
- Large option exercise in 2024: Realized ~$2.59M from exercising 214,494 options (legacy 2015 grant), suggesting a meaningful liquidity event; options were nearing 2025 expiry .
- Pledging/hedging: Prohibited (mitigates alignment risk) .
- Related party safeguards: Federal Reserve “Foreign National Commitments” restrict certain transactions with major foreign national shareholders; supports independence claims regarding the Lead Director .
BOARD GOVERNANCE (Director‑specific)
- Committee memberships: Risk Committee (member) .
- Director since: 2013 .
- Independence: Management director (not independent); majority of Board and all key committees (as required) are independent .
- Dual‑role implications: With a combined Executive Chairman/CEO (Herencia) and Paracchini as President/Bank CEO, the Lead Director structure is intended to mitigate concentration of authority; Board explicitly addressed independence concerns for the Lead Director (who is also a significant shareholder) with regulatory commitments and committee/exec session structures .
Employment & Contracts Summary – Severance and CIC Economics (Paracchini)
| Scenario | Cash Multiple | Bonus Treatment | Benefits | Notes |
|---|---|---|---|---|
| Without Cause / Good Reason (no CIC) | 1.5x salary | Unpaid EIP + pro‑rata bonus | COBRA Benefits over 18 months | Paid over 18 months . |
| Double‑Trigger CIC (≤2 years) | 1.5x (salary + higher of last two years’ bonuses) | Unpaid EIP + pro‑rata bonus | COBRA Benefits | Lump sum . |
| Special CIC (no termination) | 1.5x (salary + higher of last two years’ bonuses) | Pro‑rata bonus based on actual to closing | — | Lump sum . |
| Death/Disability | — | Unpaid EIP + pro‑rata bonus | Death benefit = 200% of salary (cap $750k) | DBO Plan pays additional $200k if death while employed . |
| Restrictive Covenants | — | — | — | 18‑month customer/employee non‑solicit; confidentiality . |
Investment Implications
- Alignment and incentives: Paracchini’s pay design is performance‑weighted (PSUs tied to ROA and rTSR vs KRX) with diversified STI metrics (asset quality, profitability, efficiency), and strong governance features (clawbacks; anti‑hedging/pledging), aligning compensation with shareholder outcomes .
- Retention and change‑of‑control: The 1.5x salary+bonus special CIC and double‑trigger CIC protections provide clear retention but also create potential payout sensitivity in M&A scenarios; equity vests on termination following a CIC, not single‑trigger, moderating risk .
- Trading signals: 2024 option exercise (~$2.59M realized) may indicate personal diversification ahead of 2025 option expiry; near‑term selling pressure from future RSU/PSU vesting appears manageable given three‑year schedules and ownership guidelines .
- Execution track record: Byline’s upward net income trajectory (2020–2024) and outperformance vs KRX on TSR in 2024 support pay‑for‑performance credibility; STI corporate score above target (111%) corroborates operating execution .
- Governance checks: Lead Director structure, majority‑independent Board/committees, and strong vote support on Say‑on‑Pay (raw counts show broad approval) reduce governance risk associated with executive/board dual roles .
Values retrieved from S&P Global where marked with an asterisk.