Mark A. Franklin
About Mark A. Franklin
Mark A. Franklin (age 46) is Chief Lending Officer of First Financial Corporation and First Financial Bank, serving since February 2022; he joined the Bank in January 2020 after a decade as a Region President at German American Bank (Feb 2009–Dec 2019). He holds a B.S. from the University of Southern Indiana and an M.A. from Ball State University, is a graduate of the ABA Stonier Graduate School of Banking, and has a Credit Risk Certification through the Risk Management Association . Company performance in 2024 included net income of $47.3 million (EPS $4.00), ROAA of 0.92%, and completion of the SimplyBank acquisition; Franklin’s 2024 scorecard showed disciplined loan growth and asset quality with non-performing loans at 0.40% vs 0.80% target and overall STIP score of 98.40% .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| First Financial Bank / Corporation | Senior Commercial Lending Executive (Indianapolis Region) | Jan 2020–Feb 2022 | Not disclosed |
| German American Bank | Region President | Feb 2009–Dec 2019 | Not disclosed |
External Roles
No external board or public company roles disclosed for Franklin .
Fixed Compensation
| Item (2024) | Amount | Notes |
|---|---|---|
| Base Salary | $296,928 | Adjusted +4.00% YoY |
| Target Bonus % (STIP) | 35% | Applied to base |
| Target Bonus $ | $103,925 | Based on 35% target |
| Actual STIP Paid | $102,261 | Based on 98.40% score |
| Life Insurance Premiums | $1,100 | Bank-sponsored program |
| ESOP Allocation | $10,350 | 2024 ESOP allocation |
| 2005 EDC (Registrant Contribution) | $1,850 | Nonqualified defined contribution |
| 2005 EDC Aggregate Balance | $5,238 | As of YE 2024 |
Performance Compensation
Short-Term Incentive Plan (STIP) – 2024 Scorecard and Payout
| Metric | Target | Actual | Achievement | Weight | Score Contribution |
|---|---|---|---|---|---|
| Bank Net Income ($000) | 62,343 | 57,403 | 92.08% | 40% | 36.83% |
| Efficiency Ratio | 64.13% | 64.72% | 99.09% | 20% | 19.82% |
| Non-Performing Loans | 0.80% | 0.40% | 200.00% | 2.5% | 5.00% |
| Delinquency | 1.00% | 0.81% | 123.46% | 2.5% | 3.09% |
| Department Controllable ($000) | 68,966 | 69,105 | 100.20% | 10% | 10.02% |
| Total Loan Growth | 11.47% | 11.46% | 99.95% | 15% | 14.99% |
| Net Charge-Offs / Loans | 0.25% | 0.33% | 75.76% | 5% | 3.79% |
| Total Loan NIM | 3.30% | 3.21% | 97.27% | 5% | 4.86% |
| Overall Score | — | — | 98.40% | — | — |
| STIP Target $ | $103,925 | — | — | — | — |
| STIP Earned $ | — | — | — | — | $102,261 |
Key design features: threshold payout at 80% of target; maximum 120% for NEOs; Committee approved adjustments excluding SimplyBank purchase accounting impacts for net income/efficiency and department controllable results .
Long-Term Incentive Plan (LTIP) – Performance Period 2022–2024 (Granted Feb 2025)
| Metric | Target | Result | Achievement | Weight | Score Contribution |
|---|---|---|---|---|---|
| Return on Assets (Bank/Corp) | 1.16% | 1.24% | 106.90% | 20% | 21.38% |
| Return on Equity (Bank/Corp) | 12.35% | 13.40% | 108.50% | 15% | 16.28% |
| Tangible Book Value | $31.39 | $35.73 | 113.83% | 30% | 34.15% |
| EPS | $4.81 | $3.98 | 82.74% | 35% | 28.96% |
| Overall Score | — | — | 100.76% | — | — |
| LTIP Target (40% of base) | $118,771 | — | — | — | — |
| LTIP Awarded | — | — | — | — | $119,677 |
| Vesting | — | — | — | — | 3-year graded (Dec 31 of grant year + next 2 years) |
Options: The Corporation historically does not grant stock options; LTIP awards are performance-based restricted stock .
Recent Equity Grants (Prior-Year Performance; Grants in 2024)
| Grant Date | Shares | Grant-Date Price | Grant-Date Fair Value | Vesting |
|---|---|---|---|---|
| Feb 6, 2024 | 3,240 | $37.45 | $121,363 | Three equal installments on Dec 31, 2024, 2025, 2026 |
Equity Ownership & Alignment
| Item | Amount / Details |
|---|---|
| Total Beneficial Ownership | 8,745 shares; includes 661 ESOP shares |
| Restricted Shares Outstanding | 5,467 shares (issued under 2011 EIP; vest over 3 years) |
| Unvested Restricted Stock (YE 2024) | 3,023 shares; market value $139,632 at $46.19/share |
| Shares Outstanding (Record Date) | 11,853,489 shares (Feb 28, 2025) |
| Ownership % of Outstanding | ~0.074% (8,745 / 11,853,489) |
| Stock Ownership Guidelines | Executives must own ≥$150,000 in stock; Franklin currently meets guidelines |
| Hedging/Pledging | Prohibited for executives and directors (anti-hedging and anti-pledging) |
| Upcoming Vesting | Remaining tranches scheduled for Dec 31, 2025 and Dec 31, 2026 |
Insider selling pressure: Near-term supply limited to scheduled vesting of ~3,023 shares through 2026; pledging and hedging are prohibited, reducing forced selling risk .
Employment Terms
| Term | Detail |
|---|---|
| Agreement Effective | July 1, 2024; 24-month term; extendable in 1-year increments |
| Base Salary (2024) | $296,928 |
| Restrictive Covenants | Non-compete and non-solicitation for 1 year post-termination; confidentiality |
| Severance (No CIC) | Cash equal to salary+target bonus+benefits through term; table shows $661,992 incremental severance |
| Severance (CIC; Double Trigger) | 2.0× (salary + target bonus + certain benefits); $880,904 incremental severance |
| Equity Treatment | Restricted stock vests in full upon termination without cause or resignation for good reason; no automatic acceleration on CIC without termination (double trigger) |
| Equity Value on Termination (Unvested) | 2011 EIP acceleration value $139,632 on both non-CIC and CIC termination scenarios |
| Clawback | Executive compensation clawback policy compliant with Nasdaq/SEC; 3-year lookback on restatements |
| Tax Gross-Ups | No excise tax gross-ups; 280G best-net or cutback applies |
Compensation Structure Analysis
- Pay mix emphasizes performance-based variable compensation; NEOs average ~45.4% variable at target (CEO 58.3%) .
- STIP and LTIP include objective financial metrics with thresholds (80%) and caps (STIP max 120% for NEOs; LTIP max 125% for NEOs); equity awards are performance-based with multi-year vesting (retention) .
- Committee made targeted adjustments to remove purchase accounting and one-time items (e.g., SimplyBank) to isolate operating performance—transparent but increases potential payout sensitivity; Franklin’s STIP still closely tracks targets (overall 98.40%) .
Related Party Transactions and Governance Signals
- Anti-hedging/pledging and insider trading policies enforced; clawback policy implemented; no option repricing; no excise tax gross-ups in employment agreements .
- 2024 say-on-pay support ~94% signals shareholder alignment with compensation program design .
Compensation Peer Group (Benchmarking)
| Peer Companies |
|---|
| 1st Source Corporation; City Holding Co.; CNB Financial Corp.; Community Trust Bancorp, Inc.; First Busey Corporation; First Mid Bancshares, Inc.; German American Bancorp Inc.; Great Southern Bancorp Inc.; Horizon Bancorp; Independent Bank Corporation; Lakeland Financial Corp.; Macatawa Bank Corporation; MidWest One Financial Group, Inc.; Peoples Bancorp, Inc. |
Performance & Track Record
- Corporate: Net income $47.3M (EPS $4.00), ROAA 0.92%; pre-tax, pre-provision income $73.4M; completed SimplyBank acquisition adding 13 branches and expanding into East Tennessee and Georgia .
- Franklin’s 2024 execution: Loan growth essentially at target (11.46% vs 11.47%) with favorable non-performing loans (0.40% vs 0.80% target) and overall STIP score of 98.40% .
- Pay-versus-performance: 2024 TSR value of initial $100 investment rose to $118; peer group $122 .
Investment Implications
- Alignment: Strong pay-for-performance architecture; Franklin’s incentives directly tied to loan growth, efficiency, ROA/ROE, and TBV, with clawback and stock ownership requirements reinforcing alignment .
- Retention: Double-trigger CIC severance (2×) and multi-year equity vesting support retention; no pledging or hedging reduces misalignment risk .
- Trading signals: Limited near-term selling pressure from ~3,023 unvested shares vesting through 2026; absence of options removes overhang risk; say-on-pay support (~94%) suggests investors accept current comp design .
- Execution risk: Loan growth at target with low NPLs is positive; watch net charge-offs/loans (0.33% vs 0.25% target) and loan NIM (3.21% vs 3.30% target) for margin/credit trends into 2025 .