Stan R. Dunsmore
About Stan R. Dunsmore
Executive Vice President and Chief Credit Officer at Citizens & Northern Bank since January 2015; previously Vice President & Commercial Loan Sales Officer (2007–2015) and, prior to the CNB acquisition, Vice President & Chief Lending Officer at Citizens Trust Company (1995–2007). Age 62; B.S. in Management Science from Lock Haven University of Pennsylvania . Company performance context during his tenure: 2024 net income $25.96 million; ROAA 1.00% and ROAE 9.76% ; company-selected incentive metric transitioned in 2024 to (PPNR–NCOs)/Average Equity, which was 12.34% for FY2024 . Over 2019–2024, CZNC total shareholder return index moved from 100 to 85.52, with peer index at 128.85 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Citizens & Northern Bank | EVP & Chief Credit Officer | 2015–Present | Oversees credit risk and lending standards across the bank |
| Citizens & Northern Bank | VP & Commercial Loan Sales Officer | 2007–2015 | Led commercial loan origination and sales post-acquisition of Citizens Trust Company |
| Citizens Trust Company | VP & Chief Lending Officer | 1995–2007 | Directed lending operations prior to acquisition by C&N |
External Roles
- No external directorships or outside roles disclosed for Mr. Dunsmore in the latest proxy statements .
Fixed Compensation
Multi-year compensation (NEO disclosure years when applicable):
| Metric (USD) | 2021 | 2022 | 2023 |
|---|---|---|---|
| Salary | $232,000 | $243,000 | $256,000 |
| Bonus (Holiday Award) | $500 | $500 | $500 |
| Stock Awards (Grant-date FV) | $66,907 | $69,581 | $40,045 |
| Non-Equity Incentive Plan Compensation (Annual cash incentive) | $62,833 | $21,000 | $39,416 |
| Change in Pension Value & Nonqualified Deferred Plan | $0 | $0 | $17,009 |
| All Other Compensation (ESOP, 401k, SERP, insurance, dividends, perqs) | $69,746 | $78,249 | $81,608 |
| Total | $431,986 | $412,330 | $434,578 |
Notes:
- Bonus amounts reflect broad “holiday awards” made to most employees except the CEO .
- Pension plan relates to Citizens Trust Company legacy defined benefit plan; present value of accrued benefit $214,475 as of 12/31/2023 .
Performance Compensation
Annual Incentive Plan – 2023
| Component | Target | Actual | Weighting | Award as % of Base Salary |
|---|---|---|---|---|
| Corporate Earnings Performance (Core ROAE vs peer percentile) | 100% | 97.32% | 45% | 11.0% |
| KPI: Growth in Annual Average Deposits (ex. brokered) | 6.2% | (1.2)% | 10% | 0.0% |
| KPI: Total Revenue | $117.2M | $106.7M | 15% | 0.0% |
| KPI: Efficiency Ratio | 61.50% | 69.51% | 10% | 0.0% |
| KPI: Total Wealth Management Revenue | $9.7M | $9.3M | 10% | 1.3% |
| Individual Performance | — | — | 10% | 3.1% |
| Total Award | — | — | 100% | 15.4% |
Program notes:
- 2023 corporate metric based on Core ROAE percentile rank vs a 20-bank regional peer group; payouts scaled 33%/100%/150% at 25th/50th/75th percentile; CZNC achieved 49th percentile (97.32% of target) .
- KRIs acted as pass/fail gates; 2023 KRIs were acceptable, enabling KPI payouts .
Long-Term Incentives
| Grant Year | Type | Grant Date | Shares | Grant Date FV | Vesting | Performance Conditions |
|---|---|---|---|---|---|---|
| 2023 | RSA (50%) + PRSA (50%) | 1/31/2023 | 1,715 | $40,045 | 1/3 annually over 3 years | PRSA tranches vest annually subject to Core ROAE ≥35th percentile and Core ROAA ≥65th percentile vs peer group; 2023 conditions met |
| 2024 | — | — | — | — | — | No 2024 LTI grants disclosed for Dunsmore; 2024 NEO LTI recipients: Scovill, Hughes, Hoose, Rush, Cwiklinski |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (2/6/2024) | 26,629 shares; includes 3,267 restricted shares; less than 1% of shares outstanding |
| Non-vested Stock (12/31/2023) | 4,683 shares; market value $105,040 |
| Stock Options | None outstanding and none exercised; company had no outstanding options for NEOs in 2023 and none outstanding as of 2/5/2025 |
| Ownership Guidelines | EVP required to own ≥1× prior year base salary; all NEOs met requirements as of 2023; guidelines reaffirmed in 2024/2025 |
| Anti-Hedging | Hedging transactions prohibited for directors and officers |
| Pledging | No pledging disclosures identified in proxies; related-party transactions requiring disclosure: none in 2023/2024 |
Employment Terms
- Agreement Type: Change in Control Agreement (not a full employment agreement) specific to Mr. Dunsmore .
- Severance Economics upon qualifying termination after Change in Control:
- Cash severance equal to 1× base salary; employer-paid group medical insurance premiums for 18 months; plus payment of unpaid salary, accrued vacation, unreimbursed expenses; and acceleration eligibility .
- As of 12/31/2023 illustrative benefits: Cash $256,000; SERP benefit $398,771; accelerated restricted stock $105,040; legacy Citizens Trust Company Pension Plan value $182,300 .
- Term and Renewal: Agreement terminates each 12/31 but auto-extends annually; if a change in control occurs, term continues for 24 months post-CIC .
- Post-Termination Covenants: 12-month non-solicitation; customary non-disclosure .
- Clawback: Executive compensation recoupment policy covering cash bonuses and equity awards in case of restatements due to material non-compliance; aligned with Nasdaq rules .
- Taxes: No excise tax gross-ups; parachute payments subject to best-net or cap to avoid 4999 excise tax .
Investment Implications
- Alignment and risk controls: Ownership guideline (≥1× salary) and anti-hedging policy, with equity-centric LTI structures and annual PRSA performance tests, support pay-for-performance alignment; no options outstanding reduces repricing risk .
- Retention and change-in-control risk: Dunsmore’s CIC protection (1× base salary, 18 months health) is materially lower than CEO/CFO (2.99×) and below some EVPs (1.5×), implying moderate retention risk in a strategic transaction; ongoing annual auto-renewal mitigates lapse risk .
- Vesting and potential selling pressure: Non-vested restricted stock as of 12/31/2023 was 4,683 shares with annual 1/3 vesting; while disclosures show no hedging and no pledging, monitoring Form 4s around vest dates remains prudent .
- Performance linkage shift: The 2024 shift to (PPNR–NCOs) metrics elevates focus on core pre-provision profitability and credit losses, directly relevant to the Chief Credit Officer role; 2024 corporate payouts reached 126% of target, indicating stronger comparative performance vs peers .
Say-on-Pay & Peer Group Context
- Say-on-Pay support: 87% approval in 2023; 82% approval in 2024 .
- Peer group construction: 20 regional publicly traded banks with assets ~0.5–2.5× CZNC across PA/NJ/NY/MD/WV/OH; percentile hurdles: 35th for ROAE and 65th for ROAA (2023); 2024 changed to (PPNR–NCOs)/Average Equity and Assets with same percentile thresholds .
Key corporate performance in 2024: Net income $25.96M; ROAA 1.00%; ROAE 9.76%; (PPNR–NCOs)/Average Equity 12.34%; corporate STIP payout 126% of target **[810958_0001104659-25-023871_tm252451-2_def14a.htm:25]** **[810958_0001104659-25-023871_tm252451-2_def14a.htm:45]** **[810958_0001104659-25-023871_tm252451-2_def14a.htm:26]**.
Equity and Awards Detail (Selected)
| Date | Award | Shares | Vesting | Notes |
|---|---|---|---|---|
| 1/31/2023 | RSA (time-based) | Part of 1,715 total | 1/3 annually over 3 years | Time-based portion |
| 1/31/2023 | PRSA (performance-based) | Part of 1,715 total | 1/3 annually, subject to Core ROAE/ROAA percentile thresholds | 2023 PRSA conditions met |
| 12/31/2023 | Unvested balance | 4,683 | Per award terms | $105,040 market value |
Pension and SERP
- Defined Benefit (legacy Citizens Trust Company Pension Plan): Present value $214,475 as of 12/31/2023 .
- SERP participation: Annual employer contributions (e.g., $45,636 in 2023); SERP lump-sum value referenced in termination scenarios ($398,771) .
Investment Implications
- Positive: Stronger 2024 corporate performance vs peers and incentive framework incorporating credit-loss-adjusted profitability aligns with Dunsmore’s remit; compliance with ownership guidelines and anti-hedging reduces misalignment risk; absence of options lowers headline governance risk .
- Watch items: CIC protection is comparatively modest (1× salary), potentially increasing turnover risk in a transaction; monitor Form 4 activity around scheduled vesting events (4,683 unvested shares at YE2023) for selling pressure; absence of 2024 LTI grants suggests decreased equity refresh vs peers in that year, warranting monitoring of future awards .
- Net: Compensation structure is largely performance-linked and risk-aware; retention risk under CIC scenarios is moderate given lower multiples, but current alignment and governance signals are acceptable.