Keith Donahoe
About Keith Donahoe
Keith Donahoe (age 54) is President of Southside Bancshares, Inc. and Southside Bank (since May 2024), with 30+ years in commercial banking and a BBA from Texas Tech University. He joined Southside in 2021 (Austin Market President → Central Texas Regional President) and today oversees credit and commercial lending, IT, and bank operations company‑wide . In 2024, Southside delivered ROAE of 11.03% and ROA of 1.06%; net income rose $1.8M (+2.1%), diluted EPS increased $0.09 (+3.2%), loans grew 3.0%, deposits 1.6%, and NPAs/Assets improved to 0.04% .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Southside Bancshares / Southside Bank | President | 2024–present | Executive oversight of credit, commercial lending, IT and bank operations across the company . |
| Southside Bank | Central Texas Regional President; previously Austin Market President | 2021–2024 | Built and led Central Texas growth, lending operations, and business development following entry to Southside in 2021 . |
| Frost Bank (regional bank in Texas) | Executive Vice President | ~2011–2021 (10 years) | Senior commercial banking leadership at a large Texas regional, bringing operating discipline and client development experience . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Real Estate Council of Austin (RECA) | Former Board Chair; continuing Board Member | n/a | Industry leadership and network in Central Texas commercial real estate . |
| Health Alliance for Austin Musicians (HAAM) | Former Board Chair | n/a | Community engagement and nonprofit governance . |
Fixed Compensation
| Component | 2024 | Notes |
|---|---|---|
| Base Salary (paid) | $461,625 | Partial year at President rate; base salary was increased to $510,000 upon promotion on May 16, 2024 . |
| Target Bonus (% of salary) | 45.0% | Set upon promotion to President; added to Annual Incentive Program in 2024 . |
| Actual AIP Cash Bonus | $138,334 | Prorated for time in President role during 2024 . |
| Other Cash/Bonus | $45,597 | Includes $43,472 prorated lender incentive pre‑promotion and $2,125 from Advanced Compensation Agreement . |
| All Other Compensation (total) | $61,996 | Club dues ($7,104), 401(k) match ($13,800), ESOP contribution ($6,092), housing ($35,000) . |
Performance Compensation
AIP metrics and results for 2024 (President participant):
| Metric | Weight | Threshold | Target | Maximum | 2024 Result | Payout vs Target |
|---|---|---|---|---|---|---|
| EPS | 40% | $2.26 | $2.66 | $4.03 | $2.98 (adjusted) | 111.7% . |
| Loan Growth | 15% | 4.00% | 5.00% | 7.00% | 3.00% | 0% (below threshold) . |
| ROATCE | 20% | 11.70% | 13.77% | 22.13% | 15.25% (adjusted) | 108.9% . |
| Qualitative Scorecard | 25% | n/a | n/a | n/a | Above Target | 120% (Donahoe) . |
Aggregate outcome: 96.4% of target; payout $138,334 (prorated for service as President) .
Long-term equity: In 2024, NEO equity awards consisted of 50% PSUs and 50% RSUs; however, Mr. Donahoe did not receive a 2024 PSU/RSU grant as a newly added AIP participant midyear (his outstanding awards are prior RSUs; see below) .
Equity Ownership & Alignment
| Item | Amount |
|---|---|
| Shares owned directly | 3,879 . |
| ESOP shares (60% vested) | 587 . |
| RSUs vesting within 60 days of 3/19/2025 | 1,476 . |
| Total beneficial ownership | 5,942 (<1% of 30,409,265 shares) . |
| Executive stock ownership guideline (President) | 2x base salary . |
| Deemed held under policy (shares) | 11,406 . |
| Compliance status | 36% of requirement as of 3/19/2025 . |
| Anti‑hedging / anti‑pledging policy | Hedging and pledging prohibited for executives/directors . |
Insider selling pressure signals:
- 1,476 RSUs were scheduled to vest/convert within 60 days of March 19, 2025, a modest potential supply event .
- Company policy prohibits hedging and pledging, reducing alignment risk from derivatives or collateralized holdings .
Equity Awards and Vesting
| Grant Date | Type | Unvested Units at 12/31/2024 | Vesting Schedule | Market Value at 12/31/2024 |
|---|---|---|---|---|
| 03/22/2021 | RSU | 1,458 | 4 years, equal annual tranches beginning 1st anniversary | $46,306 ($31.76/sh) . |
| 11/17/2022 | RSU | 1,250 | 4 years, equal annual tranches beginning 1st anniversary | $39,700 ($31.76/sh) . |
| 11/16/2023 | RSU | 482 | 4 years, equal annual tranches beginning 1st anniversary | $15,308 ($31.76/sh) . |
Notes:
- Total unvested RSUs at 12/31/2024: 3,190; no stock options outstanding .
- RSU grants vest on standard schedules; PSUs (for other NEOs) are tied to 3‑year relative ROATCE vs KBW Regional Bank Index with 0–150% payout; clawback policy applies company‑wide .
Employment Terms
| Term | Detail |
|---|---|
| Employment Agreement | Effective January 23, 2025; initial term through January 23, 2028; auto one‑year renewals thereafter unless 90‑day non‑renewal notice . |
| Compensation/Benefits | Annual salary review; eligible for AIP (no 12.5% minimum applies for Arnold/Donahoe); eligible for officer benefits/perquisites . |
| Severance/CIC | Severance benefits if terminated without cause, for good reason, or upon a change in control; agreement confirms eligibility but specific Donahoe multiples not enumerated in 2025 proxy (general terms summarized elsewhere for other NEOs) . |
| Restrictive Covenants | Company agreements include confidentiality and post‑termination restrictions for executives; 2025 proxy does not specify Donahoe’s durations; non‑compete periods for other NEOs range 6–12 months . |
| Deferred Compensation | Company agreement provides $500,000 payable monthly over 10 years upon retirement/disability/death or certain involuntary terminations; standard change‑in‑control provisions apply . |
| Advanced Compensation | $8,500 advanced on June 1, 2021; forgiven $2,125 annually through June 1, 2025 (tied to continued employment) . |
Board Governance (service, committees, and independence)
- Board Service: Donahoe is not listed as a director of Southside Bancshares, Inc. or Southside Bank as of March 19, 2025; he serves as an executive officer .
- Committee Roles (as officer): Participates on the Innovation, Digital Banking & IT Committee (company board committee) and serves on the Bank’s ALCO with other officers; these are management roles supporting board oversight, not board directorships .
- Dual‑Role and Independence: Board has an independent Chairman and is 93% independent; CEO (Lee Gibson) is a director but not Chair—mitigating CEO/Chair dual‑role concerns; anti‑hedging/pledging policy applies to directors/executives .
Performance & Track Record (select company indicators during initial tenure)
| Indicator | 2024 Outcome |
|---|---|
| ROAE | 11.03% . |
| ROA | 1.06% . |
| Net Income | +$1.8M (+2.1% YoY) . |
| Diluted EPS | +$0.09 (+3.2% YoY) . |
| Loan Growth | +3.0% . |
| Deposit Growth | +1.6% . |
| NPAs / Assets | 0.04% . |
Compensation Governance/Peer Benchmarking
- Peer Group and methodology: Compensation Committee uses an 18‑company peer set (assets ~$4.1B–$17.5B) and Meridian Compensation Partners as independent advisor; focuses on pay competitiveness and structure (cash + equity; performance emphasis) .
- Clawback: NYSE/Rule 10D‑1‑compliant compensation recoupment policy in effect .
- Executive ownership policy: President required at 2x base salary over five years; Donahoe at 36% as of March 19, 2025 .
Related Party Transactions / Red Flags
- Anti‑hedging/anti‑pledging policy applies; short sales and pledging prohibited—reduces alignment risks .
- No option repricing; recent equity grants are RSUs/PSUs with standard vesting/performance conditions .
- Perquisites include housing allowance ($35,000 in 2024) and club dues—monitor optics vs. broader pay‑for‑performance .
- Clawback policy active; no tax gross‑ups disclosed for Donahoe (split‑dollar arrangements/gross‑ups pertain to other executives) .
Investment Implications
- Alignment/Retention: Ownership requirement at 36% suggests continued accumulation is expected; combined with clawback and anti‑hedging/pledging policies, alignment should strengthen over time .
- Near‑term Supply: 1,476 RSUs were set to convert within 60 days of March 19, 2025; absolute size is modest vs. float but worth monitoring around vesting windows .
- Incentive Design: AIP focuses on EPS, ROATCE, and growth (loan growth), with qualitative goals; 2024 payout near target (96.4%) reflects balanced achievement and avoids outsized discretionary awards—supportive for pay‑for‑performance .
- Contractual Protections: 2025 employment agreement with severance/CIC protections reduces retention risk; details for Donahoe were confirmed but not fully enumerated in the proxy—investors should review subsequent 8‑Ks for granular terms .
- Governance: Independent Chair and high board independence mitigate dual‑role concerns; CEO is a director, while Donahoe is not on the board—preserving independent oversight dynamics .