James C. Leonard
About James C. Leonard
Executive Vice President and Chief Operating Officer (COO) of Fifth Third Bancorp. As COO, he leads Consumer and Small Business Banking and oversees marketing, consumer product, customer experience, and central operations, with a notable focus on Southeastern branch network expansion driving household and granular deposit growth and positioning the company for sustainable growth . Company performance metrics underpinning 2024 pay-for-performance included EPS of $3.27 (VCP adjusted actual), ROA of 1.13%, and an efficiency ratio of 57.5%; the 2022 PSU cycle paid out at 150% based on top-ranked ROACE vs peers, evidencing strong execution against long-term value creation goals .
Past Roles
No prior roles disclosed in the proxy beyond current COO responsibilities .
External Roles
No external directorships or roles disclosed for Mr. Leonard in the proxy .
Fixed Compensation
Multi-year compensation (SCT) for James C. Leonard:
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary ($) | 638,462 | 679,616 | 723,462 |
| Stock Awards ($) | 1,434,393 | 1,598,835 | 4,056,258 |
| Option/SAR Awards ($) | 253,129 | 262,502 | 375,000 |
| Annual Cash Incentive (VCP) ($) | 893,750 | 753,500 | 1,042,188 |
| All Other Compensation ($) | 129,385 | 133,807 | 124,093 |
| Total ($) | 3,349,119 | 3,428,260 | 6,321,001 |
Key fixed pay components and perquisites:
- 2024 base salary: $723,462; perquisites included executive financial planning ($7,575), parking ($2,400), guest at business functions ($4,740), and corporate security program ($4,571) .
- Company retirement benefits: standard 401(k) match; access to nonqualified deferred compensation plan (NQDCP) with 2024 company contributions of $119,323 and aggregate balance of $1,862,826 at 12/31/2024 .
Performance Compensation
Annual VCP structure and 2024 outcomes (corporate pool funding metrics and weights):
| Metric | Weight | Target | Actual (VCP Adjusted) | Funding Contribution |
|---|---|---|---|---|
| EPS ($) | 50% | 3.24 | 3.27 | 106% (53% weighted) |
| ROA (%) | 25% | 1.12% | 1.13% | 106% (26% weighted) |
| Efficiency Ratio (%) | 25% | 57.1% | 57.5% | 97% (24% weighted) |
| Total Pool Funding | — | — | — | 103% pre-modifiers; 107% after +4 modifier points |
Leonard’s 2024 VCP specifics:
- Target bonus (cash): $906,250
- Actual bonus paid (cash): $1,042,188 (≈115% of target; consistent with Committee’s 105–115% range)
Long-term incentive design and 2024 grants:
- Mix: 50% PSUs (3-year ROACE vs peer group, 0–150% payout), 35% RSUs (three-year graded vesting; dividend equivalents accrue), 15% SARs (10-year term; three-year graded vesting) .
- 2022 PSU cycle payout: 150%, with distribution approved Feb 19, 2025 .
Detailed 2024 equity grants for Leonard:
| Grant Date | Type | Shares/Units (#) | Exercise/Base Price ($) | Grant Date Fair Value ($) | Vesting/Performance Terms |
|---|---|---|---|---|---|
| 2/14/2024 | PSUs (Target) | 36,096 | — | 1,209,577 | 3-year ROACE vs peers; 0–150% payout |
| 2/14/2024 | RSUs | 25,267 | — | 846,697 | Three-year graded; dividend equivalents |
| 2/14/2024 | SARs | 38,620 | 33.51 | 375,000 | 10-year term; three-year graded |
| 2/27/2024 | RSUs (Retention) | 58,875 | — | 1,999,984 | Vest at 3 years; forfeiture up to one-third if prior-year ROTCE <2%; role acceptance/transition conditions; clawback applies |
PSU performance grid and payout parameters (for context):
| PSU Performance Level | Payout (%) |
|---|---|
| Threshold | 50% |
| Target | 100% |
| Maximum | 150% |
2024 exercises/vesting activity (insider pressure indicator):
| Action | Shares (#) | Value ($) |
|---|---|---|
| SARs exercised | 0 | 0 |
| RSUs/PSUs vested | 41,108 | 1,392,316 |
Equity Ownership & Alignment
Beneficial ownership and guideline compliance:
- Beneficial ownership: 255,060 common shares; 0.0381% of outstanding class .
- SARs exercisable within 60 days of 12/31/2024: 107,337 .
- Stock ownership guideline: 3x salary for NEOs; executives must retain 75% of net after-tax shares until guideline met (then 25% until 2x guideline). As of June 2024, all NEOs met or were on pace to meet guidelines within the five-year window .
- Hedging/pledging: Prohibited; no margin purchases or use of company securities as loan collateral allowed .
Key outstanding awards at 12/31/2024 (Leonard):
| Category | Units (#) | Market/Payout Value ($) |
|---|---|---|
| RSUs not vested (selected lots) | 4,191; 11,802; 25,267; 58,875 | 177,195; 498,989; 1,068,289; 2,489,235 |
| PSUs unearned (target units) | 17,960; 25,289; 36,096 | 759,349; 1,069,219; 1,526,139 (market/payout values) |
Ownership policy and capital accumulation:
- Insider Trading & Ethical Investing Policy governs trading; blackout periods and pre-clearance required .
- Clawback policy covers material restatements, misconduct, risk failures, and policy violations .
Employment Terms
Severance and change-in-control (CIC) economics and protective covenants:
| Scenario | Cash Severance | Bonus/COBRA | Equity Vesting | Other Benefits | Non-Compete / Non-Solicit |
|---|---|---|---|---|---|
| Involuntary without Cause / Good Reason (pre-CIC) | 1.5x base salary for Leonard | Prorated annual bonus; lump-sum equal to 12x monthly COBRA premiums | Per plan terms (no single-trigger) | — | Applies per Severance Benefits Plan (definitions of cause/good reason) |
| CIC + qualifying termination (“double-trigger”) | 2.99x (base + highest VCP bonus) for Leonard | Prorated bonus; benefits continuation per plan | RSUs/SARs vest; PSUs paid at greater of target or actual prorated; no single-trigger vesting | +3 years DC plan credit for Leonard; medical/dental/life continuation | 3 years (Leonard) |
Quantified CIC payouts if terminated 12/31/2024 (Leonard):
- Cash severance: $5,783,688; Unvested equity: $6,638,196; Other benefits: $441,223; Total: $12,863,107; no excise tax gross-up provision applicable .
Quantified termination values (non-CIC) if separated 12/31/2024 (Leonard):
- Voluntary: $6,589,371 (reflects retirement eligibility for equity per award terms)
- Death/Disability: $9,078,606
- Involuntary or Good Reason: $8,617,096
Transaction context:
- The first merger in the Comerica–Fifth Third transaction will not constitute a change-in-control for Fifth Third executive compensation and benefit plans; existing Fifth Third severance plans continue to govern officer entitlements .
Clawbacks, risk-balancing, and governance:
- Clawbacks embedded in all executive pay; Committee exercises downward discretion for risk/performance .
- No excise tax gross-ups for executive officers; CIC payouts feature double-trigger vesting only (no single-trigger since April 2008) .
Compensation Structure Analysis
- Significant increase in 2024 equity awards vs prior years driven by a $2,000,000 retention RSU grant (58,875 units) for leadership continuity and expanded responsibilities; vesting subject to role acceptance/transition conditions and ROTCE gate, indicating targeted retention and performance alignment .
- 2025 Long-term incentive mix eliminates SARs in favor of 60% PSUs and 40% RSUs, increasing performance linkage and reducing option-like risk, consistent with market practice .
- Annual incentive funding balanced across EPS, ROA, and efficiency; Committee applied qualitative modifiers tied to capital, NPA ranks, loan-to-deposit ratio, and sustainability/stewardship, signaling disciplined pay-for-performance with multi-dimensional risk oversight .
- Say-on-Pay support remained strong at 96% in 2024, reinforcing shareholder alignment of pay practices .
Investment Implications
- Alignment: Leonard’s ownership (255k shares) and stringent ownership/retention policies, combined with prohibition of hedging/pledging, reduce misalignment risk; large unvested RSU/PSU balances sustain long-term orientation .
- Retention: The 2024 $2M RSU retention grant and three-year non-compete under CIC suggest high strategic value and proactive mitigation of retention risk in critical consumer/operations areas .
- Incentive quality: Shift to heavier PSUs from 2025 and continued double-trigger CIC protections without gross-ups are shareholder-friendly features; performance metrics (EPS/ROA/efficiency, ROACE vs peers) emphasize durable profitability and capital discipline .
- Trading signals: 2024 saw no SAR exercises by Leonard and standard vesting of RSUs/PSUs; with vest schedules and ownership retention requirements, near-term forced selling pressure appears limited by policy and retention gates, though scheduled RSU distributions may create periodic supply that investors should monitor around vest dates .