Donald M. Westermann
About Donald M. Westermann
Eastern Bank’s Executive Vice President and Chief Information Officer. Age 47 as of the 2025 proxy . Joined Eastern in 2007, became SVP, CTO in 2010, and was promoted to EVP, CIO in 2015; currently leads Technology, Operations, and Eastern Labs, with responsibility for digital, cybersecurity, engineering, data management, and delivery, and recently assumed oversight of consumer banking and product to align with digital strategy . Education: B.S. in Business Administration and MIS from Villanova University; MBA from MIT Sloan . Pay-for-performance context: company Operating Net Income rose 18% to $192.6M in 2024, Net Interest Income grew 10% to $607.6M, Net Interest Margin expanded 12 bps to 2.85%, and total assets increased 21% year-over-year to $25.6B, underpinning incentive funding and PSU frameworks tied to TSR and EPS growth versus KRX peers .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Eastern Bank | SVP, Technology Engineering & Operations | 2007–2010 | Built core engineering and operations foundation for later digital initiatives |
| Eastern Bank | SVP, Chief Technology Officer | 2010–2015 | Led technology strategy pre-IPO; platform modernization |
| Eastern Bank | EVP, Chief Information Officer | 2015–Present | Leads tech, operations, innovation; expanded scope to consumer banking and product to advance digital-first strategy |
| Grant Thornton | Senior Manager (Technology/MIS) | Pre-2007 | Consulting leadership in technology and MIS relevant to bank infrastructure |
| Arthur Andersen | Consultant (Technology/MIS) | Pre-2007 | Technology/MIS consulting experience |
External Roles
No external directorships or public company board roles are listed in the DEF 14A biography for Westermann .
Fixed Compensation
| Metric | FY 2022 | FY 2023 |
|---|---|---|
| Base Salary ($) | $463,500 | $463,500 |
| Target Bonus (% of Salary) | 45% | 45% |
| Target Bonus ($) | $208,575 | $208,575 |
Notes:
- In 2024, the Company increased MIP and LTI targets for NEOs; Westermann’s targets were raised to 60% for MIP and 60% for LTI to align with market, though he was not listed as a 2024 NEO thereafter .
Performance Compensation
Annual Incentive (MIP) – 2023
| Metric | Weighting | Target | Actual | Payout Determinant | Individual Payout |
|---|---|---|---|---|---|
| GAAP Net Income | 100% | $145.7M | $232.2M | Committee capped payouts at 100% of target due to non-recurring items (insurance sale/securities loss) | 100% of target; $208,575 (45% of salary) |
Long-Term Incentive (Equity)
| Grant Year | Instrument | Metric | Weighting | Target Award Units | Vesting | Outcome/Payout Basis |
|---|---|---|---|---|---|---|
| 2022 | RSUs | Time-based | 50% | 47,438 | 5 equal annual tranches on Mar 1, 2022–2026 (grant Mar 1, 2022) | Time-based vesting; shares delivered net of tax withholding |
| 2022 | PSUs | Relative TSR vs KRX | 25% of total (half of PSU) | 23,719 target | Single vest on or around Mar 1, 2025, subject to performance | TSR below threshold; 0% earned for this metric across NEOs for 2022–2024 period |
| 2022 | PSUs | Relative EPS Growth vs KRX | 25% of total (half of PSU) | 23,719 target | Single vest on or around Mar 1, 2025, subject to performance | EPS growth at 76th percentile; 150% earned for this metric across NEOs for 2022–2024 period |
| 2023 | RSUs | Time-based | 50% | 5,930 | 3 equal annual tranches on Mar 1, 2024–2026 (grant Mar 1, 2023) | Time-based vesting; shares delivered net of tax withholding |
| 2023 | PSUs | Relative TSR vs KRX | 50% | 5,930 target | Single vest on or around Mar 1, 2026, subject to performance | Payout slope 25–150% based on percentile rank; capped at target if absolute TSR negative |
Stock vested in 2023 from 2022 RSUs: 9,487 shares vested; value realized $148,282 (pre-tax) .
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Beneficial Ownership (3/8/2024) | 38,633 shares; less than 1% of shares outstanding |
| ESOP Inclusion | Executive officer counts include ESOP allocations; 2023 ESOP value basis $13,457 for Westermann |
| Unvested RSU (2022 grant at 12/31/2023) | 37,951 units; market value $538,904 (at $14.20) |
| Unvested PSU (2022 EPS; at 12/31/2023) | 5,930 units; market value $84,202 (at $14.20) |
| Unvested PSU (2022 TSR; at 12/31/2023) | 5,930 units; market value $84,202 (at $14.20) |
| Unvested RSU (2023 grant at 12/31/2023) | 5,930 units; market value $84,206 (at $14.20) |
| Unvested PSU (2023 TSR; at 12/31/2023) | 1,483 units; market value $21,052 (at $14.20) |
| Options | None held or exercised in 2023 |
| Ownership Guidelines | Executives must hold stock multiples of salary (Exec Chair/CEO: 5x; President/CFO: 3x; others: 2x); 1-year holding requirement for 50% of vested shares until compliant |
| Anti-Hedging/Pledging | Company policy prohibits hedging and pledging for Section 16 officers and directors |
Implication: Scheduled RSU tranches (Mar 1 annually) and potential PSU vesting in Mar 2025 and Mar 2026 create recurring liquidity events; hedging/pledging prohibitions reduce alignment risk .
Employment Terms
| Provision | Detail |
|---|---|
| Change-in-Control Agreements (double trigger) | Executives receive lump sum severance if terminated without cause or resign for good reason during CIC period; for PEOs 300%, other senior executives 200% of base salary plus greater of current-year bonus or three-year average bonus; health/dental COBRA cash payments up to 18 months; post-employment non-compete/non-solicit obligations apply |
| CIC Economics – Westermann (as 2022 NEO) | 200% of base salary; MIP component equals average of prior 3 years; 18 months medical/dental; RSU/PSU acceleration subject to terms; all NEOs covered by CIC agreements |
| Clawback | Recoupment of incentive-based compensation upon accounting restatements; per Nasdaq/SEC rules |
| Severance (non-CIC) | Specific severance agreements described for Rivers, Sheahan, Miller; Westermann’s severance terms not detailed in 2025 proxy beyond CIC framework |
| Perquisites & Benefits (2023) | Perquisites $10,188; 401(k) employer contribution $9,900; dividends on vested equity $3,795; ESOP allocation value $13,457 |
Performance & Track Record
| Company Metric (2024) | Value |
|---|---|
| Operating Net Income | $192.6M (+18% YoY) |
| Net Interest Income | $607.6M (+10% YoY) |
| Net Interest Margin | 2.85% (+12 bps YoY) |
| Total Assets | $25.6B (+21% YoY) |
| Total Deposits | $21.3B |
| Total Loans | $18.1B |
| Digital Transformation | Major upgrade to online/mobile banking platform completed |
PSU performance context (2022–2024): TSR performance below threshold (no payout) while relative EPS growth at 76th percentile (150% payout), producing 75% of target overall for PSUs earned by NEOs; aligns payouts with multi-factor performance .
Compensation Governance
- Committee oversight: Compensation & Human Capital Management Committee (independent) oversees exec pay, succession, incentive risk, engages Pearl Meyer as independent consultant .
- Benchmarking: Peer group of 21 publicly traded regional/commercial banks used for 2024 compensation setting .
- Say-on-pay: 85.5% approval at 2024 meeting; committee considers shareholder feedback annually .
Investment Implications
- Alignment: Equity-heavy pay with PSUs tied to relative TSR/EPS and stricter performance mix (60% PSUs in 2024 program) increases sensitivity to long-term value creation; anti-hedging/pledging and ownership guidelines reinforce alignment .
- Vesting-driven supply: RSU tranches (March annually) and upcoming PSU determinations (Mar 2025, Mar 2026) could create episodic selling pressure; no options outstanding limits optionality but reduces leverage risk .
- Retention/CIC: Double-trigger CIC with 200% multiplier (historically for Westermann as NEO) and clawback policy balance retention with shareholder protections; absence of tax gross-ups is shareholder-friendly .
- Execution risk: Mandate spans tech, operations, cybersecurity, and consumer banking/product integration—execution on digital upgrades and integration synergies is key; company-level financial momentum supports incentive funding but TSR underperformance in 2022–2024 PSU window suggests market-relative headwinds to monitor .