Jeffrey M. McDonnell
About Jeffrey M. McDonnell
Jeffrey M. McDonnell is an independent director of Midland States Bancorp, Inc. (MSBI), age 62, serving since 2015. He is CEO of J&J Management Services, Inc., holds a B.A. in Economics from Princeton University, an M.B.A. from the University of Michigan, and is a Chartered Financial Analyst (CFA) . He previously served as a director at Heartland Bank and Love Savings Holding Company prior to Midland’s acquisition of Heartland Bank in December 2014 .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| J&J Management Services, Inc. | President & Chief Compliance Officer | 1997–2012 | Compliance leadership, private management company |
| Heartland Bank | Director | Pre-Dec 2014 | Board governance prior to Midland acquisition |
| Love Savings Holding Company | Director | Pre-Dec 2014 | Oversight at bank holding company |
External Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| J&J Management Services, Inc. | Chief Executive Officer | 2012–present | Executive management |
| The Center for Emerging Technologies (non-profit) | Board Member | Not disclosed | Technology incubation ecosystem |
Board Governance
- Committee assignments: Audit Committee member; not a chair . Audit Committee comprised of Gerald J. Carlson (Chair), Jerry L. McDaniel, Jeffrey M. McDonnell, and Richard T. Ramos .
- Independence: Board determined all directors except the CEO are independent; Audit Committee members, including McDonnell, meet Nasdaq/SEC independence standards .
- Attendance: Board held nine meetings in 2024; all directors attended at least 75% of board and committee meetings. Committees met: Audit (9), Compensation (5), Nominating & Corporate Governance (4) .
- Class and tenure: Class III nominee; director since 2015; age 62 .
Fixed Compensation
| Component | Structure/Amount | Timing/Notes |
|---|---|---|
| Annual cash retainer (non-employee director) | $40,000 | Paid quarterly |
| Committee fees | Audit: Chair $15,000 / Member $6,000; Compensation: Chair $10,000 / Member $6,000; Nominating & Governance: Chair $10,000 / Member $5,000; Risk Policy & Compliance: Chair $10,000 / Member $5,000 | Paid quarterly |
| McDonnell 2024 cash earned | $43,500 | Reflects retainer plus committee fees |
Performance Compensation
| Component | Grant Date | Grant Value | Vesting | Notes |
|---|---|---|---|---|
| Annual director equity award (RSUs) | June 30 each year | $45,000 per director in 2024 | Fully vested at grant (directors) | 2024 fair value per share $22.65; no outstanding unvested RSUs as of 12/31/2024 |
The Company does not currently grant stock options; equity awards are via LTIPs (2019 LTIP), which allow acceleration upon change in control, death or disability, though director RSUs are fully vested at grant .
Other Directorships & Interlocks
- Current public company boards: Not disclosed in the proxy for McDonnell .
- Compensation Committee interlocks: 2024 members were DiMotta, Golden, Ramos, and Smith; McDonnell was not on the Compensation Committee .
Expertise & Qualifications
- Education: B.A. in Economics (Princeton), M.B.A. (University of Michigan), CFA .
- Skills: Board experience at bank/holding company; CEO/operating experience; finance and compliance background .
- Board considered his prior board service and business experience as qualifications for MSBI’s board .
Equity Ownership
| Measure | Amount | Notes |
|---|---|---|
| Total beneficial ownership (Common Stock) | 48,598 shares; “*” less than 1% of class | |
| Shares outstanding basis for % calc | 21,879,916 shares (Common) | |
| Direct/Trust holdings | 24,245 shares held by the Jeffrey M. McDonnell Revocable Trust UA | |
| Potentially issuable within 60 days | 22,366 shares (RSUs or common stock equivalent units under Director Deferred Compensation Plan) | |
| Shares pledged as collateral | None disclosed for McDonnell (pledging noted for other insiders, not McDonnell) | |
| Anti-hedging | Directors prohibited from hedging Company securities | |
| Director ownership guidelines | 5x cash retainer; 5-year compliance window; 25% post-vesting retention until compliant |
Insider Trades (Form 4 snapshots)
| Transaction Date | Type | Securities | Quantity | Price | Post-Transaction Owned | Citation |
|---|---|---|---|---|---|---|
| 2024-06-13 | Open market purchase | Common Stock | 2,290 | $21.80 | 24,245 | |
| 2024-06-30 | Issuance/settlement | Common Stock | 1,987 | $22.65 | 1,987 | |
| 2024-03-28 | Award | Common Share Equivalents | 244.955 | $0.00 | 13,980.2816 | |
| 2024-06-28 | Award | Common Share Equivalents | 266.681 | $0.00 | 14,246.9626 | |
| 2024-09-30 | Award | Common Share Equivalents | 292.538 | $0.00 | 14,539.5006 | |
| 2024-12-31 | Award | Common Share Equivalents | 244.467 | $0.00 | 14,783.9676 | |
| 2025-03-31 | Award | Common Share Equivalents | 336.411 | $0.00 | 15,120.3786 | |
| 2025-03-31 | Award | Common Share Equivalents | 671.729 | $0.00 | 15,792.1076 | |
| 2025-06-30 | RSU grant | Restricted Stock Units | 3,262.125 | $0.00 | 9,455.125 | |
| 2025-06-30 | Award | Common Share Equivalents | 381.172 | $0.00 | 16,173.2796 | |
| 2025-09-30 | Award | Common Share Equivalents | 670.945 | $0.00 | 16,844.2246 | |
| 2025-09-30 | Award | Common Share Equivalents | 472.6842 | $0.00 | 17,316.9088 |
Director Compensation (2024 Actuals)
| Item | Amount | Notes |
|---|---|---|
| Fees Earned or Paid in Cash | $43,500 | Reflects retainer and committee service |
| Stock Awards (RSUs) | $45,000 (grant date fair value) | Granted 6/30/2024; fair market value used $22.65 |
| Total | $88,500 | — |
Compensation Structure and Policies (Directors)
| Policy Element | Detail |
|---|---|
| Cash retainer | $40,000; Chair $85,000 |
| Committee fees | Audit $15,000/$6,000; Compensation $10,000/$6,000; Nominating & Governance $10,000/$5,000; Risk Policy & Compliance $10,000/$5,000 |
| Equity | Annual RSUs fully vested; $45,000 grant value; granted June 30 |
| Deferred comp | Directors may defer under Director Deferred Compensation Plan |
| Ownership guidelines | Directors: 5x cash retainer; 5-year compliance; 25% net shares retention until compliant |
| Anti-hedging | Prohibited for directors |
Related Party Transactions and Conflicts
- Policy oversight: Related party transactions (> $120,000) are reviewed and must be approved by the Audit Committee, considering fairness, independence, and regulatory acceptability .
- Disclosures: Proxy footnotes detail pledging for certain insiders; no pledging or related-party transactions disclosed for McDonnell in the ownership table footnotes .
Say-on-Pay and Shareholder Feedback (Context)
- Prior year say-on-pay approval: ~97% support at 2024 annual meeting .
- Frequency recommendation: Board recommends annual say-on-pay .
Governance Assessment
-
Strengths:
- Independent status and Audit Committee membership bolster financial oversight .
- Consistent meeting attendance threshold met by all directors; board and committee cadence disclosed (transparency) .
- Ownership alignment supported by formal stock ownership guidelines and anti-hedging policy .
- Beneficial ownership includes meaningful shareholdings with trust and deferred units; no pledging red flags for McDonnell .
-
Potential concerns/RED FLAGS:
- Annual director RSUs are fully vested at grant, reducing performance/retention linkage relative to unvested or performance-conditioned equity .
- Company-level accounting restatement triggers clawback analysis for executives (not directors), indicating heightened governance scrutiny; Audit Committee responsible for recovery review . While not a direct issue for McDonnell, it elevates overall board accountability signals.
-
Engagement signals:
- Insider open-market purchase (2,290 shares at $21.80 on 6/13/2024) suggests personal confidence/alignment .
Overall, McDonnell’s audit oversight role, independence status, and share ownership indicate solid alignment and board effectiveness. The fully vested RSU structure for directors is shareholder-friendliness-neutral but provides limited performance tethering; company restatement context heightens the importance of robust Audit Committee oversight, where McDonnell serves .