DEF: CSB Bancorp Sets Date for 2025 Annual Meeting, Outlines Key Proposals for Shareholder Vote

CSB Bancorp announces its 2025 Annual Meeting of Shareholders to be held on April 23, 2025, outlining proposals for director elections, auditor ratification, and executive compensation advisory votes.

Summary

• CSB Bancorp will hold its Annual Meeting of Shareholders on April 23, 2025, at the Carlisle Inn in Walnut Creek, Ohio.
• Shareholders will vote on several key proposals, including the election of Cheryl M. Kirkbride and Stephen E. Schillig as directors for three-year terms expiring in 2028.
• The meeting will also include a vote to ratify the appointment of S.R. Snodgrass, P.C. as the independent registered public accounting firm for the fiscal year ending December 31, 2025.
• An advisory vote will be conducted on the compensation of CSB's named executive officers, as well as the frequency of future advisory votes on executive compensation.
• The board recommends voting in favor of all proposals, including a three-year frequency for future advisory votes on executive compensation.
• As of March 4, 2025, there were 2,644,072 common shares outstanding and entitled to vote.
• The board has determined that Robert K. Baker, Vikki G. Briggs, Julian L. Coblentz, Cheryl M. Kirkbride, and Stephen E. Schillig are independent directors under NASDAQ rules.
• The company's budgeted net income was $15.0 million, budgeted return on average assets (ROAA) was 1.24%, budgeted return on average equity (ROAE) was 13.20%, and the budgeted efficiency ratio was less than 56.47%.
• The Company's actual results were as follows: net income $10.0 million, ROAA 0.85%, ROAE 8.96% and efficiency ratio 55.77%.

Sentiment

Score: 6

Explanation: The document is largely procedural, outlining meeting details and proposals. While it highlights positive aspects like risk management and employee benefits, the underperformance against budgeted financial metrics tempers the overall sentiment.

Positives

• The board is actively engaged in risk oversight, with regular reports from senior management on material risks.
• The company has a comprehensive benefits program for all employees, including named executive officers.
• The Audit Committee is comprised of independent directors and oversees the accounting and financial reporting processes.
• The company has an insider trading policy in place to prevent illegal trading activities.
• The company's efficiency ratio was 55.77%.

Negatives

• The company's actual net income was $10.0 million, below the budgeted $15.0 million.
• The company's actual return on average assets (ROAA) was 0.85%, below the budgeted 1.24%.
• The company's actual return on average equity (ROAE) was 8.96%, below the budgeted 13.20%.

Risks

• The company faces risks related to operational, IT and cybersecurity, financial, legal, regulatory, and strategic areas.
• Credit risk represents a major risk component within the Bank, requiring oversight by the Executive/Loan Committee.
• The company's performance expectations were established around the attainment of specific performance ratios, performance to current year financial plan, and satisfactory compliance with regulatory and audit reviews as well as consideration of the potential impact of executives actions on safe and sound operations and appropriate risk management controls.

Future Outlook

The company aims to continue providing high-quality financial services, meeting customer needs, and generating profit for shareholders.

Management Comments

• Robert K. Baker, Chairman of the Board, and Eddie L. Steiner, President & Chief Executive Officer, thank shareholders for their support of CSB.
• The Board of Directors believes that its leadership structure has created an environment of open and efficient communication between the Board and management, enabling the Board to maintain an active and informed role in governance of risk management by being able to monitor and provide direction on those matters that may present significant risks to CSB.

Industry Context

The document references a peer group of similarly situated financial institutions in Ohio, including LCNB Corporation, Middlefield Banc Corp., and SB Financial Group, suggesting a focus on regional community banking.

Comparison to Industry Standards

• The Compensation Committee evaluated its pay practices for both directors and the named executive officers including but not limited to comparison within the following similarly situated financial institution peer group: INSTITUTION LOCATION LCNB Corporation Lebanon, Ohio Middlefield Banc Corp. Middlefield, Ohio SB Financial Group Defiance, Ohio Ohio Valley Bancorp Gallipolis, Ohio Consumers Bancorp Inc. Minerva, Ohio United Bancorp, Inc. Martins Ferry, Ohio
• At the end of 2024, each of the financial services institutions listed above were publicly traded institutions ranging in size from approximately $821 million in assets to $2.3 billion in assets, having core ROAA of 0.57% to 0.89%, having core ROAE of 5.49% to 12.81%, and located and doing business primarily in Ohio.

Related Party Transactions

• Director Robert K. Baker's daughter-in-law was hired as Director of Wealth Management on August 14, 2024, with a base salary of $200,000, a hiring bonus of $15,000, and annual incentive compensation of $35,000.

Stakeholder Impact

• Shareholders are asked to vote on key proposals that will impact the direction and governance of the company.
• Employees are affected by the company's compensation policies and benefits programs.
• Customers benefit from the company's commitment to providing high-quality financial services.
• The company's performance impacts the communities it serves.

Next Steps

• Shareholders are encouraged to vote on the proposals outlined in the proxy statement.
• The Board of Directors and Compensation Committee will review the voting results and consider them when making future decisions regarding executive compensation.
• The Audit Committee will continue to oversee the accounting and financial reporting processes of CSB.

Key Dates