Lyle P. Cunningham
Customers BancorpAbout Lyle P. Cunningham
Executive Vice President and Chief Banking Officer at Customers Bancorp (CUBI), age 61. Joined Customers Bank in 2014; previously served as Chief Lending Officer from 2021–2024 and now oversees specialty banking lines including Fund Finance, Technology & VC, Healthcare, and Financial Institutions, sitting on key loan committees (C&I, CRE, Consumer, Warehouse) . Education: BS in Accounting and Finance from Penn State University . Company performance context: Customers delivered five-year annual growth of 15% revenue, 20% Core EPS, and 16% tangible book value, underscoring pay-for-performance philosophy and equity-heavy incentives across the NEOs .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| CoreStates Bank | Vice President | 1988–1998 | Corporate banking and credit; foundational lending experience |
| National City Bank | Senior Vice President & Managing Director | 1999–2008 | Led lending; scaled risk and origination in commercial banking |
| CMS Mezzanine Fund | Managing Director | 2008–2013 | Structured mezzanine financing; sponsored/non-sponsored buyouts and growth capital |
| Customers Bank | EVP; Managing Director of Specialty Finance; Chief Lending Officer | 2014–2024 | Built/led specialty banking business lines; credit committees leadership |
External Roles
- No public company directorships or external committee roles disclosed for Cunningham .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 340,712 | 388,462 | 418,269 |
| Base Rate ($) | — | $400,000 (annualized) | $425,000 (annualized) |
Notes:
- 2024 base rate increased to $425,000 (+6% YoY); paid salary reflects partial-year timing .
Performance Compensation
| Component | Metric | Weighting | Target | Actual/Payout | Vesting |
|---|---|---|---|---|---|
| 2024 Annual Incentive (Other NEO) | Discretionary (aligned to Company/individual results) | N/A | N/A | $625,000 awarded in RSUs | Time-based RSUs vest in 3 equal tranches on 12/19/2025, 12/19/2026, 12/19/2027 |
| 2024 Option Award | Discretionary | N/A | N/A | $94,159 grant-date fair value; options equal to 25% of RSUs count | 100% vests on 12/19/2029; strike $46.98 |
Company-wide STI metrics used for CEO/President (context): Q4 2024 NIM ≥ 3.25% (50%), immediately available liquidity/uninsured deposits ≥ 150% (25%), CET1 ≥ 11.25% (25%); 2025 STI metrics set at NIM 3.10%, NPL ratio top quartile, liquidity ≥ 150% .
Multi-year Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 340,712 | 388,462 | 418,269 |
| Cash Bonus ($) | 160,000 | 200,000 | — |
| Stock Awards ($) | 210,000 | 490,845 | 1,050,062 |
| Option Awards ($) | — | — | 94,159 |
| All Other Compensation ($) | 158,063 | 230,485 | 246,911 |
| Total ($) | 868,775 | 1,309,792 | 1,809,401 |
Perquisites included in “All Other Compensation” (categories): 401(k) match, executive physical, personal auto use, SERP contributions, executive life insurance imputed income; amounts by category not itemized by individual .
Detailed Equity Grants and Vesting Schedule
| Award Type | Grant Date | Shares/Options | Terms | Vesting Schedule / Notes |
|---|---|---|---|---|
| RSU | 12/19/2024 | 13,304 | Time-based | 1/3 each on 12/19/2025, 12/19/2026, 12/19/2027; all unvested at 12/31/2024 |
| Stock Options | 12/19/2024 | 3,326 | Strike $46.98; 10-year term | 100% vests 12/19/2029; unexercisable at 12/31/2024 |
| RSU | 3/15/2024 | 8,559 | Time-based | 1/3 each on 3/15/2025, 3/15/2026, 3/15/2027; unvested at 12/31/2024 |
| RSU | 4/4/2023 | 9,222 | Time-based | 1/3 each on 4/4/2024, 4/4/2025, 4/4/2026; two-thirds unvested at 12/31/2024 |
| RSU | 1/5/2023 | 3,717 | Time-based | 1/3 each on 1/5/2024, 1/5/2025, 1/5/2026; two-thirds unvested at 12/31/2024 |
| RSU | 3/22/2022 | 1,220 | Time-based | 1/3 each on 3/22/2023, 3/22/2024, 3/22/2025; one-third unvested at 12/31/2024 |
| Stock Options | 2/24/2021 | 10,000 | Strike $28.37; 10-year term | 100% vests 2/24/2026; unexercisable at 12/31/2024 |
| Stock Options (exercisable) | 3/14/2019 | 5,123 | Strike $19.28; expire 3/14/2029 | Exercisable; in-the-money intrinsic value ≈ $150,616 at $48.68 close on 12/31/2024 [(48.68–19.28)×5,123] |
Rule of 65 retirement vesting: future equity awards continue to vest upon retirement if age + years of service ≥ 65, min age 60 and min 5 years of service; approved December 2024 .
Equity Ownership & Alignment
| Ownership Item (as of April 11, 2025 unless noted) | Amount |
|---|---|
| Voting Common Stock Beneficially Owned | 28,296 shares; includes 5,123 options exercisable within 60 days |
| Unvested RSUs (target) | 25,479 |
| Percent of Class | <1% (asterisk) |
| Shares Pledged as Collateral | None disclosed for Cunningham; pledging disclosure only noted for CEO |
| Ownership Guidelines | Other Executive Officers: 1× base salary; unvested RSUs count toward compliance (PBRSUs excluded) |
| Compliance Assessment | Beneficial shares 28,296 + unvested RSUs 25,479 = 53,775 counted shares; at $48.68/share 12/31/2024 close, ≈ $2.62 million vs $425,000 base salary → exceeds 1× guideline [calculated from 53,775×$48.68] |
Insider trading and hedging: Company prohibits hedging and short sales; covered persons require pre-clearance for trades .
Employment Terms
| Term | Details |
|---|---|
| Employment Agreement | None providing separation compensation |
| Change-of-Control Agreement | Effective May 1, 2019; upon termination other than for Cause or by Cunningham for Good Reason within 1 year after a change-of-control, lump sum equals 200% of highest base salary in prior 12 months + 200% of average annual performance bonuses for prior 3 years; 12-month post-termination non-solicitation/confidentiality covenants; double-trigger vesting |
| Potential Payments (as of 12/31/2024) | Change-in-control termination: $5,324,741 total; includes salary/annual award continuation value $1,766,667, options $208,754, restricted shares $1,753,552, SERP $1,595,768 |
| Death Benefits | $5,058,074 total; includes options $208,754, restricted shares $1,753,552, life/SERP death benefits $3,095,768 |
| Severance on resignation for good reason/termination without cause (no COC) | Not applicable; no such employment agreement providing severance |
| Clawback Policy | Company may claw back cash/equity incentive compensation received during 3 completed fiscal years preceding any required accounting restatement; also triggers for illegal activity, breach of fiduciary duty, intentional violation/gross negligence of policies |
| Tax Gross-ups | Company policy eliminates excise tax gross-ups in new agreements since 2014; CEO legacy agreement only; none disclosed for Cunningham |
SERP: Established April 27, 2022 for Cunningham; non-qualified plan with lifetime monthly benefits at normal retirement; change-in-control and death vesting features; 2024 registrant contribution $218,766, aggregate balance $572,428; annuity net surrender value $1,886,154 as of 12/31/2024 (non-vested at that date) .
Vesting Schedules and Insider Selling Pressure
- Time-based RSU vest dates concentrate around 3/15, 4/4, 12/19 each year through 2027; monitor potential selling or share delivery activity around these dates as RSU tranches vest (3 equal installments) .
- Options are long-dated and cliff vest at 5 years; no near-term option-driven selling pressure expected until 2/24/2026 (10,000 options) and 12/19/2029 (3,326 options) .
Compensation Structure Analysis
- Mix shifted toward equity: 2024 annual incentive paid 100% in RSUs; incremental 2024 options awarded with fair value $94,159, equal to 25% of RSU count .
- Base rate increased to $425,000 in 2024 (+6% YoY); overall total compensation rose to $1.81 million in 2024, primarily driven by larger equity grants aligned to strong Company performance (top quartile tangible book value growth, ROE, loan growth) .
- Company policy reforms: prohibition on severance for voluntary retirement, increased ownership guideline for President, and adoption of Rule of 65 vesting continuation to support retention; clawback expanded and hedging prohibited .
Say-on-Pay & Shareholder Feedback
- Say-on-Pay approval: over 97% of votes cast approved executive compensation at the 2024 Annual Meeting .
- Shareholder engagement informed changes including more frequent plan share increases, restrictions on severance, and disclosure enhancements in CD&A .
Investment Implications
- High alignment: Significant equity exposure with multi-year vesting and no pledging disclosed for Cunningham; ownership substantially exceeds guideline, reducing misalignment risk .
- Retention incentives: Rule of 65 and SERP benefits create strong retention hooks; change-of-control compensation is double-trigger and formulaic, mitigating windfall risk while providing protection in strategic scenarios .
- Near-term supply: RSU vesting schedules cluster around March/April and December, which can create episodic selling pressure; options do not create near-term supply until 2026 .
- Pay-for-performance: Equity-heavy awards in 2024 reflect strong operating execution and peer-top quartile results; ongoing STI metrics (NIM, liquidity, asset quality) maintain focus on risk-adjusted growth .