Banks have utilized bank-owned life insurance (BOLI) as an effective tool for offsetting expenses associated with employee benefit plans. While originally most common at large banks, BOLI has now become prevalent with community banks.
BOLI is life insurance purchased by a bank on its key employees (generally, BOLI can be purchased on up to the 35% most highly compensated employees). Premium payments are made by the bank, which owns the policies and is typically the beneficiary of all, or a portion of, policy death benefits.
While a bank's rationale for purchasing BOLI has fluctuated little in the over time, the product landscape has evolved tremendously. This evolution has resulted in improved product options for banks - General Account, Separate Account, and Hybrid BOLI products.
Our experts are intimately familiar with core issues financial institutions are facing. Regulatory and compliance concerns are of the utmost importance when establishing new, or modifying existing compensation practices.
Executive compensation services include:
Qualified Benefit Plans
Deferred Incentive Plans
Annual Incentive Plans
Effective corporate governance is vital when managing the complex interactions between shareholders, boards, executives, employees, and other stakeholders. Regulators and shareholders now have renewed interest in how banks are managed.
Due to increased scrutiny of corporate governance, it is even more important to stay up to date on changes in regulations and market conditions and implement an active program that promotes best practices and acts in the interest of shareholders. Our experts provide advisory services to assist board and compensation committees as they fulfill their strategic and fiduciary duties. We emphasize education and transparency in order to ensure board members have the knowledge and tools necessary to guide the bank effectively.
Our advisory services include:
CD & A Preparation
Internal Pay Equity
Benefit Plan Review
Equity Allocations and Dilution
Board of Directors Compensation
Compensation Committee Checklist
Compensation Committee Charter
Executive Succession Planning
Board and CEO Performance Evaluations
Shareholder Exit Strategies
Say On Pay
Education Sessions on Compliance and Compensation
A Meyer-Chatfield Strategy
Over the last 20 years, there's been a shift in the primary source of executive retirement benefits. Executives are realizing more of their benefits from non-qualified plans than ever. As part of this shift, numerous non-qualified plans such as Supplemental Executive Retirement Plans (SERPS) remain an integral part of executive benefits within the banking industry. However, with the longevity of life expected to increase in the coming decades, certain SERPS have become antiquated.
LINQS+, is a proven methodology to help retain and reward your key employees while delivering the following benefits:
Cost saving arrangements
Enhances defined benefit SERPs
Lifetime benefit to executives
Final benefit is not contingent upon investment performance