Paul Mylum
About Paul Mylum
Paul M. Mylum is Executive Vice President and Chief Lending Officer of National Bankshares, Inc. (NKSH) and The National Bank of Blacksburg (NBB). He has served as EVP/CLO since November 2019, after serving as SVP/CLO (2016–2019) and SVP/Loans (2012–2016); he was age 58 as of the company’s 2024 Form 10‑K disclosure . Pay-for-performance is anchored to company financials: the annual incentive plan uses Budgeted Net Income and ROAA, and RSUs granted for 2024 performance vest over three years subject to a relative ROAA gate (1.25× the median ROAA of selected Virginia banks in the $1–$3B peer group) . Company-level performance under SEC “Pay versus Performance” shows cumulative TSR eroded across 2022–2024 (value of $100: $117 → $97 → $88) alongside net income down from $25.9m (2022) to $15.7m (2023) to $7.6m (2024); average “compensation actually paid” to non‑PEO NEOs fell ~13.9% in 2024, indicating downward pay alignment in a tough rate environment .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| National Bankshares, Inc. / The National Bank of Blacksburg | Executive Vice President / Chief Lending Officer | Nov 2019 – Present | Leads the lending function as CLO |
| The National Bank of Blacksburg | Senior Vice President / Chief Lending Officer | Aug 2016 – Nov 2019 | Lending leadership (CLO) |
| The National Bank of Blacksburg | Senior Vice President / Loans | Aug 2012 – Aug 2016 | Senior oversight of loan portfolio |
External Roles
- Not disclosed in company filings reviewed.
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary paid ($) | 248,187 | 254,102 | 229,583 |
| “All Other Compensation” ($) | 23,088 | 20,302 | 18,685 |
| All Other – 401(k) match ($) | 12,488 | 13,018 | 11,479 |
| All Other – ESOP contrib. ($) | 10,600 | 7,284 | 6,008 |
| All Other – Perquisites ($) | — | — | 1,198 (club dues) |
| Base salary rate (not the same as “salary paid”) | 2023 | 2024 |
|---|---|---|
| Base salary ($) | 225,000 | 236,000 (4.89% increase) |
Note: Base salary rates reflect mid-year effective changes; “Salary paid” in the Summary Compensation Table differs due to timing .
Performance Compensation
| Annual Incentive Plan (AIP) Design | Details |
|---|---|
| Corporate metrics | 50% Budgeted Net Income; 50% ROAA; pool funds at 80%/100%/120% for threshold/target/superior |
| Individual component | 20% of AIP based on role-specific performance for NEOs (assessed by CEO and Compensation Committee) |
| Target opportunity | 25% of base salary for Paul Mylum |
| Form of payout (from 2024 performance) | 50% paid in cash; 50% in RSUs vesting in equal annual installments over 3 years, subject to relative ROAA gate (1.25× median ROAA of selected VA banks, $1–$3B peer group) |
| 2024 AIP Outcome (awarded/paid in early 2025) | Amount / Terms |
|---|---|
| Cash bonus (2024 performance) | $26,555 cash |
| RSU grant (grant date Feb 14, 2025) | 929 RSUs valued at $26,555 on grant date |
| RSU vesting | Vests in three equal installments over 3 years; each tranche contingent on achieving 1.25× the median peer ROAA in applicable year |
| Options / PSUs | Not disclosed; equity awards are RSUs for executives under the 2023 Stock Incentive Plan |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (as of Mar 13, 2024) | 1,924 shares; less than 1% of outstanding; includes ESOP shares |
| ESOP shares included | 1,924 shares (entire holding via ESOP) |
| Unvested RSUs from 2024 performance (granted Feb 14, 2025) | 929 RSUs subject to 3-year equal vesting and relative ROAA condition |
| Hedging / Pledging | Company prohibits hedging and pledging by directors and NEOs (anti‑hedging & pledging policy) |
| Ownership guidelines | Disclosed guideline applies to directors (≥4× annual retainer); no executive stock ownership guideline disclosed |
Employment Terms
| Element | Terms for Paul Mylum |
|---|---|
| Employment agreement | Proxy identifies employment agreements for CEO, President, and CFO; Mylum not listed among officers with such agreements |
| Change in control (CIC) / severance | No separate cash severance shown; potential payments table shows no “Post-Termination Compensation” or “Continuation” benefits for Mylum outside the salary continuation plan |
| Officers Salary Continuation Plan (SCP) – normal retirement | $70,000 per year, payable for life or 15 years; normal retirement age 65 on 6/22/2031 |
| SCP – early termination (annual) | $46,146 as of 12/31/2024 (annual amount; starts at normal retirement age) |
| SCP – CIC (annual) | $60,401 as of 12/31/2024 (annual amount; payable from termination; life/15 years) |
| SCP – disability (annual) | $46,146 (annual amount; starts at normal retirement age; life/15 years) |
| SCP – death (annual) | $70,000 (annual amount; paid to beneficiary for 15 years) |
| Retirement plan accruals (12/31/2024) | Company Retirement Income Plan PVAB: $584,661; SCP PVAB: $357,871 |
| Clawback policy | Incentive compensation subject to clawback |
| Anti-hedging / pledging | Hedging and pledging prohibited |
| CIC mechanics | Company notes double‑trigger CIC severance structures and no excise tax gross‑ups in its compensation practices |
Performance & Pay Alignment Indicators
| Indicator | 2022 | 2023 | 2024 |
|---|---|---|---|
| Company net income ($) | 25,932,000 | 15,691,000 | 7,623,000 |
| Value of $100 investment (TSR) | 117 | 97 | 88 |
| Avg “Compensation actually paid” to non‑PEO NEOs ($) | 262,755 | 350,383 | 301,690 |
Governance context: The Compensation Committee engaged Meridian (independent consultant) in 2023 to redesign the AIP and implement the 2023 Stock Incentive Plan; shareholders gave 94% support on Say‑on‑Pay at the 2024 annual meeting .
Investment Implications
- Pay-for-performance is credible and increasingly risk-adjusted: the AIP is 80% tied to corporate financials (Budgeted Net Income, ROAA), with RSUs vesting over three years only if NKSH achieves a relative ROAA hurdle (1.25× peer median), and non‑PEO “compensation actually paid” declined ~13.9% in a down‑earnings, down‑TSR year (2024), indicating calibration of incentives to outcomes .
- Limited severance overhang for Mylum: he is not party to the employment agreements disclosed for CEO/President/CFO, and his “Potential Payments” table shows no cash severance or welfare continuation beyond the salary continuation plan; CIC exposure is the SCP’s $60,401 annual lifetime/15‑year benefit, rather than a multiple of salary/bonus .
- Selling pressure from equity appears contained: Mylum’s direct beneficial ownership is small (1,924 shares, <1%, entirely ESOP), RSUs vest in thirds and require annual performance to vest, and the company prohibits hedging and pledging, which collectively mitigates forced monetization risk .
- Retirement benefits are meaningful and support retention: PVAB for the defined benefit plan ($584,661) and SCP ($357,871) plus the scheduled $70,000 annual SCP retirement benefit at age 65 (June 22, 2031) create tangible long‑term retention economics, particularly under CIC or retirement scenarios .
- Governance practices reduce risk: clawback policy, anti‑hedging/pledging, double‑trigger CIC without excise tax gross‑ups, and high Say‑on‑Pay support (94%) collectively lower governance risk and compensation friction costs for investors .