Chip Reeves
About Chip Reeves
Chip Reeves, 57, is Chief Executive Officer and a director of MidWestOne Financial Group, Inc. (MOFG) and MidWestOne Bank, appointed November 1, 2022; he holds a BA from Miami University and previously led Beach Bancorp and senior roles at Cascade Bancorp and Fifth Third Bank . 2024 “pay versus performance” shows Company TSR at 96.4 (vs 100 peer group TSR 122.1), net loss of $60.3 million, and Company-selected measure diluted EPS of -$3.54; compensation actually paid (CAP) to the PEO was $1.626 million, broadly aligned with TSR/EPS trends . Say‑on‑pay support was 95.1% in 2024, indicating strong shareholder acceptance of compensation design .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Beach Bancorp, Inc. | President & CEO | Not disclosed | Led a community bank; CEO experience preceding MOFG appointment |
| Cascade Bancorp | President & COO | Not disclosed | Regional bank leadership and operations depth |
| Fifth Third Bank | EVP Commercial Banking; Chicago Market President | 22‑year career | Commercial leadership in Chicago; market P&L accountability |
External Roles
| Organization | Role | Years |
|---|---|---|
| Iowa Bankers Association | Director | Not disclosed |
| Iowa Association of Business & Industry | Director | Not disclosed |
| Orchestra Iowa | Director | Not disclosed |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Base Salary ($) | $104,166 | $625,000 | $646,875 | $675,984 |
| Non‑Equity Incentive ($) | — | $225,000 | $534,039 | Eligible; target 65% of base |
| Stock Awards Granted ($) | $250,000 | $325,000 | $400,003 | Approved total $483,750 (60% PSUs/$290,250; 40% RSUs/$193,500) |
| All Other Compensation ($) | $7,595 | $288,067 | $30,476 | Not disclosed |
Perquisites and benefits (selected 2024 items): 401(k) match $17,250, ESOP $7,211, auto stipend $6,000 annualized and $15 appreciation benefit, totaling $30,476 .
Performance Compensation
Annual Cash Incentive (2024)
| Metric | Weighting | Target | Actual/Payout | Notes |
|---|---|---|---|---|
| Core EPS | Part of 60% financial goals | Not disclosed | Above target; component contributed to 112% blended financial payout | |
| Core ROATCE | Part of 60% financial goals | Not disclosed | Above target; component contributed to 112% blended financial payout | |
| Efficiency Ratio | Part of 60% financial goals | Not disclosed | Above threshold, below target; included in 112% blended payout | |
| Individual Goal 1: Strategic plan execution | 20% | Not disclosed | 150% of target | |
| Individual Goal 2: Executive talent assessment/recruitment/development | 20% | Not disclosed | 150% of target | |
| Total Payout | — | — | $534,039; 127% of target |
Design: five equally weighted goals; financial metrics (Core EPS, Core ROATCE, Efficiency Ratio) 60% combined; two role‑specific goals 40% total; payout curve 50% threshold to 150% max; linear interpolation; committee discretion retained .
Long‑Term Incentives (Equity)
| Grant Year | Instrument | Target Split | Performance Metrics | Vesting | 2024 Grant Value |
|---|---|---|---|---|---|
| 2024 | PSUs + RSUs | 60% PSUs / 40% RSUs | 3‑yr cumulative core diluted EPS and 3‑yr ROATCE, equally weighted | PSUs vest at 3 years; RSUs vest in 3 equal annual tranches | $400,000 ($240,002 PSUs; $160,001 RSUs) |
| 2023 | PSUs + RSUs | Not specified here | Same two financial metrics | PSUs vest 2/15/2026 (threshold required); RSUs in 3 annual tranches | Included in 2023 stock awards |
| 2022 Cycle (2019–2021 grants) | PSUs | — | Company‑selected goals | Payout certified at 0% (below threshold) | 0% PSU payout for 2022–2024 performance period |
2025 approved equity: $483,750 total grant at target split 60% PSUs ($290,250) and 40% RSUs ($193,500); RSUs vest annually over 3 years; PSUs measured over 3 years; acceleration for death/disability and CIC per plan terms .
Equity Ownership & Alignment
| Item | Amount/Detail |
|---|---|
| Beneficial ownership (shares) | 69,575; includes 32,000 IRA, 37,344 joint with spouse, and 231 ESOP shares |
| Ownership % of outstanding | Less than 1% (shares outstanding 20,815,715 on March 3, 2025) |
| Unvested RSUs (12/31/2024) | 12,151 ($353,837 market value at $29.12) |
| Unearned PSUs (12/31/2024) | 8,310 ($241,987 market/payout value at $29.12) |
| RSU vesting schedule | 2/15/2025: 2,179; 2/15/2026: 2,178; 2/15/2027: 2,179 (2024 grant); 2/15/2025: 1,399; 2/15/2026: 1,399 (2023 grant); 11/15/2025: 2,372 (2022 grant) |
| PSU vesting (subject to performance) | 2/15/2026: 3,148 (2023 grant); 2/15/2027: 4,902 (2024 grant) |
| Stock ownership guidelines | CEO: 5× base salary (includes unvested shares); 75% retention until compliant; all NEOs and directors compliant as of 12/31/2024 |
| Hedging/pledging | Hedging prohibited; pledging not disclosed for Reeves |
| Insider trading windows | Blackout from 2 weeks before quarter end to 2 trading days after earnings release |
Note: Shares vesting can create periodic tax‑related selling pressure around noted vest dates; 2024 vesting realized value was $118,804 on 4,025 shares .
Employment Terms
| Term | Detail |
|---|---|
| Agreement term | Through 12/31/2025; auto‑extends 1 year each January 1 unless nonrenewal; upon change‑in‑control (CIC), remains in effect for 2 years post‑CIC |
| Severance (non‑CIC) | 175% of then‑current base salary; illustrative value $1,132,031 as of 12/31/2024 |
| Severance (CIC + termination within covered period) | 250% of “Base Compensation” (greater of current base or base pre‑CIC plus prior year incentive), lump sum; illustrative total $3,690,841 including RSU $353,830 and PSU $384,726 acceleration |
| CIC without termination | PSUs continue to vest under plan terms (no RSU acceleration) |
| Equity acceleration | Death/disability: RSUs 100% immediate; PSUs at target immediate |
| COBRA continuation | Eligible at same active employee contribution rates; monthly cost examples disclosed as of 12/31/2024 |
| Non‑compete/non‑solicit | 18 months post‑termination for Reeves (15 months for other NEOs) |
| 280G cutback | Aggregate CIC payments limited to $1 below excise tax trigger; no tax gross‑ups |
| Clawback | SEC/Nasdaq compliant clawback adopted Aug 2023; applies to incentive comp on restatement/misconduct |
| Deferred compensation | Executive Deferred Compensation Plan available; Reeves had no 2024 contributions or balances |
Board Governance
- Role: CEO and director; not independent under Nasdaq rules; committees comprised solely of independent directors .
- Leadership structure: Separate Chair and CEO; Tracy S. McCormick anticipated to be elected Chair post‑April 2025 AGM; prior lead independent director role eliminated as Chair will be independent .
- Committees: Audit (Chair Carl Chaney), Human Capital & Compensation (Chair Tracy S. McCormick, transitioning to Jennifer Hauschildt), Nominating & Corporate Governance (Chair Matthew Hayek); Reeves does not serve on committees .
- Attendance: Board held seven meetings in 2024; all directors attended ≥75% of board/committee meetings; executive sessions for independent directors held three times in 2024 .
- Director compensation: As employee, Reeves receives no director fees .
Dual‑role implications: Separation of Chair/CEO mitigates concentration risk and enhances board independence; Reeves’s management compensation is set and reviewed by the Human Capital & Compensation Committee, with CEO performance assessment led by the independent Chair and full board input .
Director Compensation (for board service context)
- Non‑employee directors receive cash retainers and RSUs; Chairs receive additional retainers; RSUs vest in one year; ownership guideline of 5× annual cash retainer . Reeves, as CEO, receives no director compensation .
Compensation Structure Analysis
- Mix and alignment: 2024 CEO total compensation $1.611 million with increased equity grants ($400k) and above‑target annual incentive (127% of target), while long‑cycle PSUs for 2022–2024 paid 0% (below threshold), evidencing pay sensitivity to longer‑term underperformance .
- Annual incentive design: Balanced with 60% financial and 40% strategic/talent goals; capped at 150%; no payouts for below threshold; governance oversight and risk assessment by Compensation Committee and CRO .
- Peer group and consultant: F.W. Cook serves as independent consultant; peer group refreshed to add CrossFirst; Committee does not target fixed percentile; decisions incorporate performance, scope, and internal equity .
- Policies: No options currently granted; insider trading/anti‑hedging in place; robust clawback; ownership guidelines with retention requirements; dividend equivalents forfeitable on unvested awards after 12/31/2023 .
Related Party Transactions and Risks
- Related party transactions reviewed by Audit Committee; no adverse independence impacts disclosed; Section 16 compliance largely timely (one late Form 4 by a different director) .
- Risk indicators: Hedging prohibited; no disclosed pledging by Reeves; PSU zero payout over 2022–2024 indicates no repricing/modification; high say‑on‑pay approval reduces governance risk .
Equity Ownership & Vesting Supply Map (Potential Insider Selling Pressure)
| Date | Instrument | Shares | Note |
|---|---|---|---|
| 2/15/2025 | RSUs | 2,179 (2024 grant) | Vests; standard tax withholding may trigger share sales |
| 2/15/2025 | RSUs | 1,399 (2023 grant) | Vests |
| 11/15/2025 | RSUs | 2,372 (2022 grant) | Vests |
| 2/15/2026 | RSUs | 2,178 (2024 grant) | Vests |
| 2/15/2026 | RSUs | 1,399 (2023 grant) | Vests |
| 2/15/2026 | PSUs | 3,148 (2023 grant; perf contingent) | Vests subject to threshold performance |
| 2/15/2027 | RSUs | 2,179 (2024 grant) | Vests |
| 2/15/2027 | PSUs | 4,902 (2024 grant; perf contingent) | Vests subject to threshold performance |
Performance & Track Record
- 2024 business actions: 5% commercial loan growth; core deposits up 3.9%; noninterest-bearing deposits up 6.1%; NPAs ratio improved to 0.40%; wealth management revenue +16%; Bank of Denver acquisition and sale of Florida operations; $118.6 million equity raise and balance sheet repositioning .
- Pay vs performance: Five‑year TSR below peer index; CAP trends directionally aligned with TSR and diluted EPS; 2024 Company TSR 96.4; net income −$60.3 million; diluted EPS −$3.54 .
- Merger: Nicolet Bankshares announced all‑stock acquisition of MOFG at implied $41.37 per share; Reeves expressed support; directors/NEOs entered support agreements; expected closing H1 2026 .
Say‑on‑Pay & Shareholder Feedback
| Year | Say‑on‑Pay Approval |
|---|---|
| 2024 | 95.1% |
Compensation Committee Analysis
- Composition: Independent directors; 2024 Chair Tracy S. McCormick; transition to Jennifer Hauschildt post‑AGM; F.W. Cook retained; meets ~6 times annually; oversight of human capital strategy .
- Peer group: Midwest regional banks list includes Nicolet Bankshares (NIC) and others; refreshed annually .
- Risk controls: Annual risk assessments; clawback; insider trading/anti‑hedging; stock ownership guidelines .
Investment Implications
- Alignment: High equity weighting with stringent PSU metrics and zero 2022–2024 PSU payout supports pay‑for‑performance; strong ownership guidelines and anti‑hedging reduce misalignment risk .
- Retention and change‑in‑control: Robust CIC economics (250% of base+prior bonus plus equity vesting upon termination) lower near‑term retention risk through H1 2026 merger timeline; 280G cutback avoids gross‑up optics .
- Trading signals: Defined RSU vesting dates present potential periodic supply; PSUs contingent on performance reduce immediate overhang; blackout/insider policies limit opportunistic trading .
- Governance: Separate Chair/CEO with independent committees and strong say‑on‑pay support mitigate dual‑role concerns; merger governance to include MOFG directors (4 seats), preserving influence post‑closing .