DEF 14A: Atlantic Union Bankshares to Add American National Directors Amid Merger

Atlantic Union Bankshares Corporation's proxy statement outlines proposals for the 2024 annual meeting, including the election of directors and ratification of the accounting firm, alongside details of a pending merger with American National Bankshares Inc.

Summary

• Atlantic Union Bankshares Corporation is soliciting proxies for its 2024 annual meeting of shareholders to be held virtually on May 7, 2024.
• Shareholders will vote on the election of directors, ratification of Ernst & Young LLP as the independent registered public accounting firm for 2024, and an advisory vote on executive compensation.
• A key event is the pending merger with American National Bankshares Inc., expected to close on April 1, 2024, which will result in two American National board members, Nancy Howell Agee and Joel R. Shepherd, joining Atlantic Union's board.
• If the merger is completed before the annual meeting, the board size will increase to 16, then decrease to 14 after the retirement of two current directors, Thomas P. Rohman and Thomas G. Snead, Jr.
• The proxy statement details corporate governance practices, director compensation, executive compensation, and stock ownership information.
• The company emphasizes its commitment to ESG practices and corporate social responsibility.
• The document also includes information on the company's culture, risk oversight, and audit information.

Sentiment

Score: 7

Explanation: The document presents a balanced view, highlighting both positive strategic moves and challenges faced. The pending merger and commitment to ESG are positive, while industry turmoil and executive compensation decisions temper the overall sentiment.

Positives

• The company is committed to ESG practices and has published a Corporate Social Responsibility Report.
• The company offers competitive health plans, generous paid time off, and robust retirement plans to its employees.
• The company has a Diversity, Equity, Inclusion, and Belonging Council to promote a diverse and inclusive workplace.
• The company has implemented a number of corporate governance actions to reflect best governance practices.
• The company has established a Code of Business Conduct and Ethics that applies to all of its directors, officers, and teammates.
• The company has a strong enterprise cyber strategy and is actively engaged in the oversight of its cyber risk profile.

Negatives

• Two current directors, Thomas P. Rohman and Thomas G. Snead, Jr., will retire at the 2024 annual meeting.
• The company did not achieve threshold performance for its corporate performance measures under the MIP in 2023 based on the levels set in February 2023 before the Silicon Valley Bank and Signature Bank failures.

Risks

• The merger with American National Bankshares Inc. is subject to customary closing conditions and may not be completed.
• The company operates in a heavily regulated industry and is subject to legal and regulatory compliance risks.
• The company faces risks related to financial, operational, information technology, cybersecurity, credit, market, capital, interest rate, liquidity, reputation, strategic, legal, regulatory, compliance, and model risk.
• The company's compensation programs could create risks that may have a material adverse effect on the company.

Future Outlook

The company expects the merger with American National to close on April 1, 2024, subject to customary closing conditions.

Management Comments

• John C. Asbury, President and Chief Executive Officer, encourages shareholders to read the proxy statement and submit their proxy as soon as possible.
• The company's culture is defined by its purpose to 'enrich the lives of the people and the communities we serve'.

Industry Context

The document highlights the challenges faced by the banking industry in 2023 due to bank failures and rising interest rates, and how Atlantic Union Bankshares navigated these challenges.

Comparison to Industry Standards

• The Compensation Committee uses a peer group of 22 publicly traded U.S. banks with assets ranging from approximately 50% to 200% of Atlantic Union's asset size to benchmark executive compensation.
• The peer group includes Ameris Bancorp, Heartland Financial USA, Inc., TowneBank, Berkshire Hills Bancorp, Inc., Home BancShares, Inc., Trustmark Corporation, BankUnited, Inc., Pinnacle Financial Partners, Inc., UMB Financial Corporation, Cadence Bank, Renasant Corporation, United Bankshares, Inc., First Financial Bancorp., Sandy Spring Bancorp, Inc., United Community Bank, Inc., F.N.B. Corporation, Simmons First National Corporation, WesBanco, Inc., Fulton Financial Corporation, SouthState Corporation, and WSFS Financial Corporation.
• The company's financial performance exceeded the median of its proxy peer group on each selected return measure under the MIPOperating ROA, Operating ROTCE and Operating Efficiency Ratio.

Management Changes

Related Party Transactions

• Certain directors and officers and members of their immediate families, and corporations, partnerships and other entities with which such persons are associated, are customers of the Bank.
• All loans extended and commitments to lend by the Bank to such persons have been made in the ordinary course of business upon substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with unaffiliated persons and do not involve more than the normal risk of collection or present other unfavorable features.

Stakeholder Impact

• The company's actions are intended to enhance value for teammates, shareholders, customers, and communities.
• The company is committed to enhancing and improving the communities where its customers live, work and play.

Next Steps

• Shareholders are encouraged to vote on the proposals outlined in the proxy statement.
• The company will proceed with the merger with American National Bankshares Inc., pending customary closing conditions.
• The company will continue to monitor and manage risks related to its business and industry.
• The company will continue to implement its ESG practices and corporate social responsibility initiatives.

Key Dates

Keywords

annual meeting, proxy statement, directors, executive compensation, merger, corporate governance, ESG, American National, Atlantic Union, shareholders