Company: SYBT
Filing Date: 2025-03-12
Form Type: DEF 14A
Source: 0001437749-25-007118
Chunk: 66

Company: Stock Yards Bancorp, Inc.
Filing Date: 2025-03-12
Form: DEF 14A
Chunk 66
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| Peer Bank ROAA performance percentile |     |           | 80 | % |     |        | 85 | % |     |         | 90 | % |

Three-year EPS performance goals have been established by the Committee and consider the Company’s strategic plan as well as projected growth targets to maintain our standard as a top-performing community bank. The three-year EPS goal has defined threshold, target and maximum performance levels. We have elected not to disclose these performance levels for competitive reasons, but we note that the levels for 2024 PSUs were set above our EPS performance targets for the 2024 annual cash incentive. The Committee determined that setting the EPS target for the 2024 PSUs above the EPS target for the 2023 PSUs was not practical, as the 2024 actual adjusted EPS was expected to be significantly impacted by anticipated market conditions affecting the entire financial services industry, including declining interest rates, net interest margin compression and increasing credit costs. These factors resulted in lower budget expectations for 2024 net income as compared to budget expectations at the beginning of 2023.

The performance metrics in our 2024 incentive plans are designed to measure different aspects of our performance and reward performance that drives increases in shareholder value. As a result of this pay for performance orientation, the Committee determined to use Company EPS and line of business goals in our incentive plans as the Committee believes that EPS drives TSR which is a key indicator of performance over the long-term and thus aligns management’s interests with shareholders. EPS is one of the principal measures used by investors to assess financial performance results and it is a central component of our guidance to investors. EPS aligns our executives’ interests with the broader set of strategic objectives they are tasked to manage, keeping increasing enterprise value and shareholder interests at the forefront of management decisions and actions to drive growth on both a short- and long-term basis. Accordingly, the Committee determined it was important to include EPS as a key component of both our annual and long-term incentives.

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The following table summarizes the design of the PSU portion of the 2024 long-term incentive plan (all percentages relate to each executive’s 2024 base salary in effect at January 1, 2024):

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