8-K: Rhinebeck Bancorp CEO Michael J. Quinn Announces Retirement After 40 Years of Service

Rhinebeck Bancorp's President and CEO, Michael J. Quinn, will retire after 40 years with the bank, prompting a search for his successor.

Summary

• Michael J. Quinn, President and CEO of Rhinebeck Bancorp, Inc., Rhinebeck Bank, and Rhinebeck Bancorp, MHC, will retire after 40 years of service.
• He will remain in his current roles until a successor is found or until the end of the year, with a target retirement date of December 31, 2025.
• The Board of Directors has formed a Search Committee to find a successor, utilizing an executive search firm.
• Mr. Quinn has entered into a Retirement Separation Agreement, effective March 21, 2025, which supersedes his previous employment agreement.
• He will continue to receive his regular base salary through December 31, 2025, and will be eligible for his 2025 bonus.
• The bank will also continue to provide certain benefits, including COBRA premiums, club memberships, and use of a company car, until his retirement date.
• The agreement includes non-competition and non-solicitation covenants, as well as non-disparagement, cooperation, and non-disclosure provisions.
• Mr. Quinn's vested annual benefit under the Supplemental Executive Retirement Plan (SERP) is $108,000, payable in equal monthly installments for 20 years, commencing on the last day of the month following his 65th birthday.
• His vested balance under the Long-Term Incentive and Retention Plan will be distributed in a lump sum on the first day of the seventh month following the Retirement Date.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. While the retirement of a long-serving CEO introduces uncertainty, the announcement emphasizes the bank's strong foundation, commitment to its values, and proactive approach to succession planning. The positive comments from both the outgoing CEO and the Board Chair contribute to the favorable sentiment.

Positives

• An orderly leadership transition is planned with Mr. Quinn remaining in his role until a successor is found.
• The Retirement Separation Agreement provides clarity and structure for Mr. Quinn's departure.
• The bank's succession plan is being implemented, demonstrating preparedness for leadership changes.
• Rhinebeck Bank has a strong capital position and a history of adaptability.

Negatives

• The departure of a long-serving CEO could create uncertainty in the short term.
• The search for a successor may take time and resources.
• The bank will incur costs associated with Mr. Quinn's retirement benefits and the executive search process.

Risks

• The new CEO may not be as effective as Mr. Quinn in leading the bank.
• The transition period could disrupt the bank's operations.
• Competition for qualified CEO candidates could be intense.
• Failure to find a suitable successor in a timely manner could negatively impact the bank's performance.

Future Outlook

Rhinebeck Bank is committed to identifying a leader who will build on the Bank's strong foundation while positioning it for the next chapter of innovation and growth.

Management Comments

• Bill Irwin, Chair of Rhinebeck Bank's Board of Directors, stated that Michael's leadership has left an indelible mark on Rhinebeck Bank.
• Michael J. Quinn stated that serving as Rhinebeck Bank's CEO has been one of the greatest honors of his life and that he is proud of what they have built together.

Industry Context

Succession planning is a critical aspect of corporate governance in the banking industry, especially for community banks where leadership continuity is essential for maintaining customer relationships and community trust. The announcement reflects a proactive approach to managing leadership transitions.

Comparison to Industry Standards

• Many community banks face succession challenges due to the aging workforce and the difficulty of attracting and retaining talent in smaller markets.
• The use of an executive search firm is a common practice among banks to ensure a thorough and objective search process.
• The terms of Mr. Quinn's retirement package, including salary continuation and benefits, are generally in line with industry standards for executive compensation.
• Comparable companies such as Salisbury Bancorp and Northeast Community Bancorp have also undergone recent CEO transitions, highlighting the importance of succession planning in the current environment.

Management Changes

Stakeholder Impact

• Shareholders may experience short-term uncertainty due to the leadership transition.
• Employees may be affected by changes in leadership and strategic direction.
• Customers may be concerned about the continuity of service and relationships.
• The community may be interested in the new CEO's commitment to local involvement.

Next Steps

• The Board of Directors will continue the search for a new CEO.
• Mr. Quinn will remain in his current role to ensure a smooth transition.
• The bank will work to maintain its commitment to its core values and community service.

Key Dates

Keywords

retirement, CEO, Rhinebeck Bancorp, succession, leadership, banking, Michael J. Quinn