Joseph Schierhorn
About Joseph Schierhorn
Joseph M. Schierhorn (age 67) is Chairman of Northrim BanCorp, Inc. and Northrim Bank; he served as President & CEO of the Company (2017–April 6, 2024) and CEO of the Bank (2016–April 6, 2024) before transitioning to the Chair role on April 6, 2024 . He holds a JD and Masters in Management from Willamette University, is a Certified Public Accountant, and a member of the Alaska Bar Association . Company performance under his tenure included 2024 net income of $36.97 million and a cumulative value of $243 for a $100 initial investment (company-selected TSR measure), indicating strong shareholder returns, with total assets at $3.04 billion at year-end 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Northrim Bank | VP, Commercial Loan Officer | 1990–2000 | Frontline origination/relationships in Alaska market . |
| Northrim Bank/Company | SVP, Commercial Loan & Compliance Manager | 2000–2001 | Built compliance and commercial credit processes . |
| Northrim Bank/Company | CFO (EVP from 2005) | 2001–2014 | Finance leadership through growth and acquisitions . |
| Northrim Bank/Company | Corporate Secretary | 2013–2015 | Governance and disclosure oversight . |
| Northrim Bank | COO | 2013–2014 | Operational integration and efficiency . |
| Northrim Bank | President | Mar 2015–Mar 2022 | Expanded footprint; led customer-first service initiatives . |
| Northrim Bank | CEO | Jan 2016–Apr 2024 | Strategic execution and risk oversight . |
| Northrim BanCorp, Inc. | COO | 2013–Apr 2024 | Enterprise operations and resource allocation . |
| Northrim BanCorp, Inc. | President & CEO | Jun 2017–Apr 2024 | Capital allocation, shareholder value creation . |
| Northrim BanCorp, Inc. & Northrim Bank | Chairman | 2018–present | Board leadership; post-2024 Chair/CEO split . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Pacific Wealth Advisors, LLC | Lead Director & Audit Committee Chair | Since 2017 | Governance and audit oversight . |
| Pacific Portfolio Trust Co. | Director | Since 2017 | Fiduciary oversight . |
| Pacific Bankers Management Institute (Pacific Coast Banking School) | Board member | Since 2017 | Banking education leadership . |
| Federal Reserve Bank of San Francisco CDIAC | Council Member | 2016–2019 | Regional banking policy input . |
| KEEP Alaska Competitive | Co-Chair | Since 2020 | Advocacy for competitive business environment . |
Fixed Compensation
Multi-year compensation for Joseph M. Schierhorn:
| Year | Salary ($) | Stock Awards ($) | Non-Equity Incentive ($) | Change in Pension/Deferred ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|---|
| 2022 | 478,855 | — | 237,512 | 368 | 154,818 | 871,553 |
| 2023 | 554,585 | 233,328 | 209,633 | 148 | 159,915 | 1,157,609 |
| 2024 | 319,736 | 176,475 | 112,555 | 26,356 | 48,007 | 683,129 |
- 2024 CEO-to-Chair transition reset annual salary to $200,000 effective April 6, 2024 (prior CEO salary level was $580,639) .
- “All Other” includes 401(k) match and SERP contributions ($18,975 and $29,032 in 2024) .
Performance Compensation
Profit sharing (annual cash incentive) and 2024 equity awards structure:
| Metric | Weight | Threshold | Target | Stretch | Payout Range |
|---|---|---|---|---|---|
| Total Shareholder Return (relative, 1–5B asset SNL US Bank Index) | 50% | 70th percentile | 45th percentile | 25th percentile | 50%–150% of target |
| Return on Average Assets (relative, 3-year avg) | 50% | 70th percentile | 45th percentile | 25th percentile | 50%–150% of target |
2024 plan-based awards (Schierhorn):
| Grant Type | Grant Date | Time-Based RSUs (#) | Performance Units (Target #) | Perf Units Threshold/Max (#) | Profit Sharing Threshold/Target/Max ($) |
|---|---|---|---|---|---|
| RSU + PSU | Mar 28, 2024 | 1,744 | 1,744 | 872 / 2,616 | — |
| Profit Sharing | Dec 31, 2024 | — | — | — | 24,119 / 80,396 / 120,594 |
- Time-based RSUs vest on the 3rd anniversary of grant (March 28, 2027) .
- Performance units vest based on 3-year TSR and ROAA relative performance vs the selected peer index; payout 50–150% of target .
Equity Ownership & Alignment
| Item | Details |
|---|---|
| Total beneficial ownership | 99,515 shares; 1.8% of outstanding . |
| Breakdown | Includes options exercisable within 60 days (44,200), spouse’s 307 shares (disclaimed), and 9,655 shares held in 401(k) . |
| Unvested RSUs | 9,159 units; vest 5,570 on Mar 23, 2026 and 3,589 on Mar 29, 2027; market value $713,852 at $77.94 (12/31/2024) . |
| Options outstanding | 5,908 @ $42.02 exp 12/1/2031; 9,268 @ $32.09 exp 12/2/2030; 7,409 @ $36.46 exp 12/4/2029; 11,192 @ $37.06 exp 11/28/2028; 10,423 @ $33.30 exp 11/15/2027 . |
| Hedging/pledging policy | Hedging prohibited; pledging strongly discouraged under Insider Trading Policy . |
| Executive ownership guidelines | No executive share ownership requirement; non-officer directors recommended to hold ≥3x annual stock retainer (within 5 years) . |
Insider transactions and selling pressure indicators:
- Reported a Code “F” transaction (tax withholding upon vest) for 1,932 shares on Nov 19, 2024 (non-open market disposition), typical of vest-related tax events .
- Reported a gift of 294 shares on Feb 25, 2025 .
- Multiple Form 4 filings in late 2024 reflect routine award-related changes; see SEC and cloudfront references .
Employment Terms
| Provision | Schierhorn Terms |
|---|---|
| Current role & agreement | New agreement as Chairman effective Apr 6, 2024; annual salary set at $200,000 (CEO salary prior: $580,639) . |
| Profit Sharing eligibility | New 2025 employment agreements for other NEOs include profit sharing; Schierhorn’s new agreement does not reflect eligibility (though he earned $112,555 for 2024 under prior agreement) . |
| Non-compete | 1-year non-compete post-termination; 1-year post-change-of-control; Edwards has 9-month variant (context) . |
| Severance (no cause/good reason) | 1x highest base salary over prior 3 years; health/insurance continuation for 1 year . |
| Change-of-control (double trigger) | 2x highest base salary + 2x average profit share over prior 3 years; health/insurance continuation for 2 years . |
| Potential payments table (12/31/2024) | Without cause/good reason: $200,000 cash severance; Change-in-control: $400,000 cash severance; Death: RSUs $713,852; benefits $2,410,230; Disability: $80,000 cash; RSUs $713,852; benefits $2,424,520 . |
| Clawback | Compensation Recovery Policy adopted 2023 (restatement-triggered recoupment) . |
| Deferred/SERP | SERP contribution equal to 20% of base salary in 2024; SERDCP participation with $2.4 million key-man coverage and retirement benefit design . |
Board Governance
- Role and independence: Schierhorn is Chair of the Board; the Board deems all nominees except Schierhorn and Huston as independent (i.e., Schierhorn is not independent) .
- Board/committee activity: Company Board met 6 times in 2024; Bank Board met 6 times; all directors attended ≥75% of meetings .
- Committee leadership: Independent Lead Director is John C. Swalling; chairs executive sessions and leads evaluations; committee compositions (Audit: McCambridge chair; Compensation: Nelson chair; Governance & Nominating: Swalling chair) are independent .
- Chair/CEO split: Leadership structure separated Chair and CEO beginning in 2024–2025, with Lead Independent Director in place to balance oversight .
Director Compensation
- Employees serving as directors (including Schierhorn and Huston in 2024) receive no additional director fees; non-officer directors were paid retainers and meeting fees as disclosed .
Compensation Peer Group and Practices
- Independent consultant Frederic W. Cook & Co. advises compensation; peer banks (16) include HomeStreet, Heritage Financial, Central Pacific Financial, Bank of Marin, Sierra Bancorp, Timberland Bancorp, etc., used to benchmark pay and equity award values .
- Options repricing prohibited without shareholder approval; only nonqualified stock options under the 2023 Plan; 325,000 shares authorized; 131,134 shares remaining available at 12/31/2024 .
Say-on-Pay & Shareholder Feedback
- 2024 advisory vote received ~94% approval; no changes made to program as a result .
Related Party Transactions and Regulatory Loans
- Reg O lending: Insider loans follow policy approvals and are on market terms; transactions did not involve more than normal risk or unfavorable features .
- Related party transactions >$120k: None in 2024–2022; governance process requires disclosure and recusal .
Performance & Track Record Indicators
| Measure | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Total Shareholder Return (value of $100 initial investment) | 92 | 122 | 159 | 173 | 243 |
| Net Income ($000) | 32,888 | 37,517 | 30,741 | 25,394 | 36,971 |
| Total Assets ($000) | 2,121,798 | 2,724,719 | 2,674,318 | 2,807,497 | 3,041,869 |
Risk Indicators & Red Flags
- Clawback policy active since 2023; aligns incentives with accurate reporting .
- Hedging prohibited; pledging discouraged; mitigates misalignment risk .
- Section 16(a) compliance: Company believes all officers/directors filed timely in 2024 .
- Equity award timing: No grants made during sensitive windows per Item 402(x) in FY2024 .
- No related party transactions above threshold; reduces conflict risk .
Compensation Structure Analysis
- 2024 mix reflects greater equity-based compensation continuity despite CEO-to-Chair transition; Schierhorn received RSUs/PSUs and profit sharing for 2024, but his new Chairman agreement does not include profit sharing going forward (lower at-risk pay post-transition) .
- Equity emphasis shifted to RSUs and PSUs vs. options; no options granted 2022–2024; options outstanding from prior plans remain and are long-dated .
- Performance metrics (relative TSR and ROAA) provide multi-year pay-for-performance linkage with capped payouts and clawback provisions; targets are set on relative basis to control for macro factors .
Equity Ownership & Trading Signals
| Ownership & Awards | Indicator |
|---|---|
| 99,515 shares beneficially (1.8% of class); significant option inventory and unvested RSUs | High alignment; meaningful long-term exposure . |
| Form 4 code “F” transactions in Nov 2024 | Tax withholding on vesting; not indicative of discretionary selling pressure . |
| Gift of 294 shares (Feb 25, 2025) | Non-economic transfer; minimal pressure . |
Investment Implications
- Alignment: Schierhorn’s sizable ownership, option inventory, and unvested RSUs, combined with hedging prohibitions and clawback, indicate strong alignment and disciplined incentive design .
- Retention risk: As Chair, his compensation now emphasizes fixed components with legacy equity vesting; retention risk is modest given role transition and long-dated awards, though absence of profit sharing in the new Chair agreement slightly lowers at-risk pay .
- Pay-for-performance: PSU metrics (relative TSR/ROAA) and profit sharing criteria (capital ratios, ROAA rank, segment P&L vs budget) reinforce performance linkage; 2024 net income and TSR trends support payout potential over the 3-year cycle .
- Governance: Chair/CEO split with an independent Lead Director and fully independent key committees mitigate dual-role concerns; Schierhorn is not independent, but structure and attendance mitigate oversight risk .
- Trading signals: Recent insider forms reflect routine vesting/tax events and a small gift; no evidence of open-market selling pressure; vest schedules into 2026–2027 may create event-driven supply at vest dates, typically small vs float .
Compensation risk controls (no hedging, clawback, capped payouts) and governance (split Chair/CEO, independent committees) support investor confidence. Watch TSR/ROAA over the 2024–2027 PSU cycle; vest dates in 2026–2027 may modestly affect supply.