DEF: 1st Source Corporation Announces Annual Meeting of Shareholders, Proxy Statement Details Director Elections and Auditor Ratification

1st Source Corporation's proxy statement outlines key proposals for the upcoming annual shareholder meeting, including the election of directors and ratification of the independent auditor.

Summary

• 1st Source Corporation will hold its Annual Meeting of Shareholders virtually on April 24, 2025, to vote on the election of four directors for terms expiring in 2028 and the ratification of Forvis Mazars, LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025.
• Shareholders of record as of February 13, 2025, are eligible to vote.
• The proxy statement details the voting procedures, outstanding shares (25,285,937 shares of common stock), and principal holders of the company's stock.
• It also includes information on the Board of Directors, their committees, corporate governance practices, executive compensation, and related party transactions.
• The Board recommends voting for the election of each director nominee and for the ratification of the appointment of Forvis Mazars, LLP.

Sentiment

Score: 8

Explanation: The document presents a positive outlook for 1st Source Corporation, highlighting strong financial performance and community engagement. The company's commitment to sustainability and ethical practices further contributes to a favorable sentiment.

Positives

• The company achieved net income of $132.6 million in 2024, a 6.2% increase from 2023.
• The company earned $5.36 per share, a 6.6% increase from 2023.
• The company continued 37 years of dividend increases.
• The company achieved a return on average assets of 1.52%, placing it in the top 10% of publicly-traded peer companies.
• The company grew its average loans outstanding to $6.60 billion, a 6.4% growth over the prior year.
• The company was one of 18 banks to be included in the Keefe, Bruyette & Woods, Inc. (KBW) Bank Honor Roll.
• The U.S. Small Business Administration (SBA), Indiana District recognized the Company with a Gold Level Award in the Community Lender category for the twelfth consecutive year.
• The company was named by Forbes as one of Americas Best Banks, ranking #14 in the country.
• The company was named to the Forbes Best in State Banks and Best Employers for New Graduates lists and the US News & World Reports Best Company to Work For in the Midwest 2024 list.
• The company maintained its #1 deposit share in its 16 contiguous county market.
• The company has invested $175 million and provided debt financing in 67 solar projects across 19 states with current loan and lease outstandings of $487 million.

Negatives

• Net new primary relationships achieved only 39% of the target.
• Core deposit growth was 1.30%, below the minimum target of 1.50%.

Risks

• The document mentions the need to continue to make meaningful investments in cybersecurity controls for continuous improvement and maturation in response to constantly evolving cybersecurity threats.
• Cybersecurity threats will continue to be endemic to the financial services industry for the foreseeable future.

Future Outlook

The company's long-term success is built and dependent on the long-term, sustainable success of all who live, work, and do business in the communities it serves.

Industry Context

The document provides insight into the corporate governance and executive compensation practices of a regional bank, 1st Source Corporation, which can be compared to similar institutions in the financial services industry.

Comparison to Industry Standards

• The document compares 1st Source Corporation's performance to Midwest Peers, National C&I Peers, and National $3 to $10 Billion Assets Peer Groups.
• The company's return on average assets of 1.52% placed it in the top 10% of all publicly-traded $3 to $10 billion peer companies as of the date of its annual review period.
• The company was one of 18 banks to be included in the Keefe, Bruyette & Woods, Inc. (KBW) Bank Honor Roll, which consists of banking institutions that have had 10 consecutive years of increased earnings per share.
• The company was named by Forbes as one of Americas Best Banks, ranking #14 in the country and the only bank in Indiana to be in the top 15.
• Bank Director Magazine ranked the Company #26 of 123 banks between $5 billion and $50 billion in assets on their Bank Performance Scorecard.

Related Party Transactions

• Directors and officers of 1st Source and their affiliates were customers of, and had transactions with, 1st Source and its subsidiaries in the ordinary course of business during 2024.
• In 2024, 1st Source Bank paid an aggregate of $3,001,921 for services provided by Aunalytics.

Stakeholder Impact

• The company's performance and governance practices impact shareholders, employees, customers, and the communities it serves.
• The company's commitment to community engagement and financial inclusion benefits local communities.
• The company's focus on sustainability and ethical practices aligns with the interests of environmentally and socially conscious stakeholders.

Next Steps

• Shareholders are encouraged to vote on the proposals outlined in the proxy statement.
• The company will hold its Annual Meeting of Shareholders on April 24, 2025.
• The Audit, Finance and Risk Committee will investigate the basis for the negative vote and will reconsider its appointment in light of the results of such investigation if shareholders do not ratify the appointment of Forvis Mazars.

Key Dates