James A. Sandgren
OLD NATIONAL BANCORP /IN/About James A. Sandgren
James A. Sandgren is ONB’s Chief Executive Officer, Commercial Banking (since February 2022), previously President & COO (May 2016–February 2022) and, earlier, Chief Banking Officer (April 2014–May 2016). He is 58, per ONB’s FY2024 10-K executive roster, with a 33-year ONB track record across regional CEO and credit leadership roles dating back to 1992 . 2024 incentive design tied short-term pay to Adjusted EPS; ONB delivered $1.83 adjusted EPS for a 115% AICP payout, while long-term PSUs for the 2022–2024 cycle paid at 184.75% of target on strong relative TSR (38.8%, ~86th percentile) and ROATCE (16.6%, ~82nd percentile) vs the KRX Index . Sandgren is retirement-eligible under ONB’s Equity Incentive Plan, which affects severance and vesting mechanics in certain scenarios .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Old National Bancorp | CEO, Commercial Banking | 2022–present | Leads commercial banking post First Midwest merger integration and growth initiatives |
| Old National Bancorp | President & COO | 2016–2022 | Enterprise operations leadership; precursor to current commercial role |
| Old National Bancorp | EVP & Chief Banking Officer | 2014–2016 | Enterprise banking leadership; AICP participation and equity awards established |
| Old National Bank | Southern Region CEO | 2007–2014 | Regional P&L leadership |
| Old National Bank | Southern Region Chief Credit Officer | 2004–2007 | Credit risk leadership |
| Old National Bank | Commercial Lending Manager | 1997–2004 | Origination/portfolio management |
| Old National Bank | Commercial Development Officer | 1992–1997 | Business development |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 593,269 | 620,192 | 645,192 |
| Target Bonus % (AICP) | — | — | 85% of base for CEO, Commercial Banking |
| AICP Cash Earned ($) | 1,008,558 | 790,745 | 551,337 |
| Stock Awards, Grant-Date Fair Value ($) | 3,391,654 | 687,584 | 1,032,907 |
| All Other Compensation ($) | 87,943 | 92,342 | 151,955 |
| Total Compensation ($) | 5,081,424 | 2,190,863 | 2,490,850 |
Notes:
- 2024 base salaries for NEOs were set in March 2024; the AICP 2024 target metric was Adjusted EPS with specified thresholds .
- ONB did not grant stock options in 2024; long-term equity delivered via service-based RS and PSUs .
Performance Compensation
Short-Term Incentive (AICP – 2024)
| Metric | Weighting | Target | Actual (Adjusted) | Payout | Vesting |
|---|---|---|---|---|---|
| Adjusted EPS | 100% | $1.75 | $1.83 (after $0.03 pension distribution adjustment) | 115% of target | Typically cash; may be paid in shares per plan |
Threshold/Maximum schedule: Threshold $1.62 → 50%; Target $1.75 → 100%; Maximum $2.06 → 200% .
Long-Term Incentive (PSUs)
| Cycle | Metric | Weighting | Result | Payout | Vesting / Restriction |
|---|---|---|---|---|---|
| 2022–2024 | Relative TSR vs KRX | 50% | 38.8% TSR (~86th percentile) | 191% of target | Earned; paid March 2025 |
| 2022–2024 | Relative ROATCE vs KRX | 50% | 16.6% ROATCE (~82nd percentile) | 179% of target | Earned; paid March 2025 |
| 2022–2024 | Combined | — | — | 184.75% of target | Restriction period ended March 2025 |
| 2023–2025 | TSR & ROATCE vs KRX | 50% / 50% | In progress | — | Restriction ends March 15, 2026 |
| 2024–2026 | TSR & ROATCE vs KRX | 50% / 50% | In progress | — | Restriction ends March 15, 2027 |
Service-based RS awards vest in three equal annual installments (e.g., March 1 of 2025, 2026, 2027); one-year RS awards were used for a portion of 2023 AICP paid in 2024 .
Grant Detail (2024 Awards)
| Award Type | Number of Units | Grant-Date Fair Value ($) |
|---|---|---|
| PSUs (2024–2026) | 22,095 | 417,151 |
| Service-Based Restricted Stock | 37,569 | 615,756 |
Equity Ownership & Alignment
Beneficial Ownership (Record Date March 20, 2025)
| Holder | Common Shares/Units | % of Class |
|---|---|---|
| James A. Sandgren | 343,785 | <1% of 319,312,019 shares outstanding |
- Included in ownership: 36,530 restricted shares with voting but not dispositive power; PSUs not vesting within 60 days are excluded .
- Stock Ownership Guidelines: NEOs must hold the lesser of 3x salary or 50,000 shares (CEO Commercial Banking falls under salary ≥$250k tier); all NEOs met guidelines as of proxy date .
- Anti-pledging and anti-hedging: Pledging requires CLO approval; hedging, short-selling, and derivatives are prohibited .
Outstanding Unvested/Unearned Awards (as of Dec 31, 2024)
| Award | Count | Market/Payout Value ($) |
|---|---|---|
| RS (2022 grant, vests 2025) | 6,115 | 132,757 |
| RS (2023 grant, vests 2025–2026) | 12,904 | 280,146 |
| RS (2024 grant, vests 2025–2027) | 22,095 | 479,682 |
| RS (2024 one-year vest – paid in 2025) | 15,474 | 335,941 |
| PSUs (2022–2024, payable 2025) | 40,514 | 879,559 |
| PSUs (2023–2025) | 41,382 | 898,403 |
| PSUs (2024–2026) | 45,540 | 988,673 |
Vesting/Value Realized
| Year | Shares Vested | Value Realized ($) |
|---|---|---|
| 2023 | 211,361 | 3,700,895 |
| 2024 | 45,651 | 754,861 |
Employment Terms
- Employment/CRC Agreements: Auto-renew annually; severance payable on termination without Cause or for Good Reason; release required for severance; breach of confidentiality/non-solicit/non-compete results in forfeiture of severance and unvested/unearned equity, with repayment of severance received during breach .
Non-Change-in-Control Severance (Illustrative, 2025 Proxy)
| Component | Amount ($) |
|---|---|
| Base Salary | 1,300,000 |
| Short-Term Incentive | 1,105,000 |
| RS Unvested Awards | 1,228,526 |
| PSUs (2022–2024) | 398,227 |
| PSUs (2023–2025) | 420,197 |
| PSUs (2024–2026) | 479,682 |
| Medical/Life & Outplacement | 65,358 |
| Total | 4,996,990 |
Change-in-Control (CIC) Severance (Double Trigger; Illustrative, 2025 Proxy)
| Component | Amount ($) |
|---|---|
| Base Salary | 1,950,000 |
| Short-Term Incentive | 2,515,265 |
| RS Unvested Awards | 1,228,526 |
| PSUs (2022–2024) | 398,227 |
| PSUs (2023–2025) | 420,197 |
| PSUs (2024–2026) | 479,682 |
| Medical/Life & Outplacement | 114,108 |
| Total | 7,106,005 |
Key CIC mechanics:
- Cash severance equals three times target cash compensation (base + target bonus + 7.5% of base for retirement/executive benefits), plus prorated annual bonus; payable within 60 days subject to release .
- All outstanding PSUs and RS vest at target upon qualifying termination within 24 months post-CIC; PSUs deemed target .
- No tax gross-ups; payments reduced to IRC §280G safe harbor if needed .
Deferred Compensation (2024)
| Plan | Executive Contributions ($) | Company Contributions ($) | Aggregate Earnings ($) | Balance at Year-End ($) |
|---|---|---|---|---|
| ONB Executive Deferred Compensation Plan | 114,875 | 64,938 | 161,573 | 1,087,220 |
Perquisites
- 2020 country club membership allowance: $16,380 (business development) .
Compensation Structure Analysis
- Mix: Emphasis on at-risk variable pay (AICP + PSUs/RS), with base salaries targeted near peer median; at-risk comp ~68% of NEO target TDC in 2024 .
- Metric rigor: AICP 2024 used a single Adjusted EPS metric with a 50–200% payout curve; long-term PSUs split 50/50 TSR/ROATCE vs KRX over three years .
- Equity vehicles: Shift to PSUs and service-based RS; ONB granted no stock options in 2024 .
Equity Ownership & Governance Policies
- Ownership guidelines: CEO 5x salary or 200k shares; COO 4x or 100k; salary ≥$250k 3x or 50k; all NEOs compliant as of proxy .
- Clawbacks: Compliant with SEC/Nasdaq rules; 3-year lookback, recoup excess incentive-based pay after restatement .
- Anti-pledging/hedging: Prohibitions on pledging without approval; hedging/derivatives/short-selling prohibited .
Performance & Track Record Highlights
- Strategic transactions: Completed CapStar partnership (April 1, 2024) and announced Bremer Bank partnership (expected May 1, 2025) .
- Pay-for-performance alignment evidenced by AICP payout (115%) and PSU payout (≈185%) for 2022–2024 cycle .
Investment Implications
- Alignment: High proportion of at-risk pay and strict stock ownership/clawback/anti-hedging policies support shareholder alignment; PSUs tied to relative TSR and ROATCE sharpen external benchmarking .
- Retention risk: Retirement eligibility plus significant unvested RS/PSUs suggests retention levers remain effective, but severance/CIC terms create defined exit economics; monitor March 1 and March 15 annual vesting/earn dates for potential selling pressure post-vesting .
- Pay-for-performance signal: Above-target AICP and strong PSU outcomes reinforce execution on credit, deposit and fee growth; continued focus on EPS may tighten near-term incentives amid rate cycles .
- Governance safeguards: No tax gross-ups; safe harbor reductions; double-trigger CIC; automatic forfeiture for covenant breaches mitigate excess parachute and misconduct risks .