Compensation Related Costs, General

12 Months Ended

Dec. 31, 2023

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Stock-Based Compensation

Stock-Based Compensation Plan

In February 2020, the Board of Directors, with subsequent approval of the Corporation’s shareholders, approved the adoption of the 2020 Incentive Compensation Plan. All remaining shares available for grant under the 2017 Incentive Compensation Plan were rolled into the 2020 Plan. As of December 31, 2023, approximately 7.2 million shares remained available for grant under the 2020 Plan.

Under the 2020 Plan, options are generally exercisable up to ten years from the date of grant, have an exercise price that is equal to the closing price of the Corporation’s stock on the grant date, and vest ratably over 4 years.

The Corporation also issues restricted stock awards under the 2020 Plan. The shares of restricted stock are restricted as to transfer, but are not restricted as to dividend payment or voting rights. Restricted stock units receive dividend equivalents but do not have voting rights. The transfer restrictions lapse over three years or four years, depending upon whether the awards are performance-based or service-based. Performance-based awards are based on total shareholder return, return on capital metrics, and continued employment or meeting the requirements for retirement, and service-based awards are contingent upon continued employment or meeting the requirements for retirement. Performance-based restricted stock awards granted during 2022 and 2023 will cliff-vest after the three year performance period has ended. Service-based restricted stock awards granted during 2022 and 2023 will generally vest ratably over a period of four years.

The 2020 Plan provides that restricted stock awards and stock options will immediately become fully vested upon retirement from the Corporation of retirement eligible colleagues. See Note 1 for the Corporation’s accounting policy for stock based compensation.

Accounting for Stock-Based Compensation

The fair values of stock options and restricted stock awards are amortized as compensation expense on a straight-line basis over the vesting period of the grants. For colleagues who meet the definition of retirement eligible under the 2017 Plan and the 2020 Plan, expenses related to stock options and restricted stock awards are fully recognized on the date the colleague meets the definition of normal or early retirement. Compensation expense recognized is included in personnel expense on the consolidated statements of income.

A summary of the Corporation’s stock option activity for the year ended December 31, 2023 is presented below:


Stock Options	Shares(a)	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value(a)









Outstanding at December 31, 2022	3,994	$	21.06	5.11 years	$	10,525


Exercised	178	17.26
Forfeited or expired	24	19.54
Outstanding at December 31, 2023	3,792	$	21.25	4.26 years	$	5,834
Options exercisable at December 31, 2023	3,583	$	21.44	4.15 years	$	5,139

(a) In thousands

Intrinsic value represents the amount by which the fair market value of the underlying stock exceeds the exercise price of the stock option. For the years ended December 31, 2023, 2022, and 2021, the intrinsic value of stock options exercised was approximately $518,000, $4 million, and $9 million, respectively. The total fair value of stock options that vested was approximately $943,000 for the year ended December 31, 2023, $2 million for the year ended December 31, 2022, and $4 million for the year ended December 31, 2021.

For the years ended December 31, 2023, 2022, and 2021, the Corporation recognized compensation expense of approximately $333,000, approximately $710,000, and $1 million, respectively, for the vesting of stock options. Compensation expense for 2023 related to the accelerated vesting of stock options granted to retirement eligible colleagues was immaterial. At December 31, 2023, the Corporation had approximately $32,000 of unrecognized compensation expense related to stock options that is expected to be recognized over the remaining requisite service periods that extend predominantly through the first quarter of 2024.

The following table summarizes information about the Corporation’s restricted stock activity for the year ended December 31, 2023:


Restricted Stock	Shares(a)	Weighted Average Grant Date Fair Value








Outstanding at December 31, 2022	2,303	$	20.81
Granted	880	22.10
Vested	778	21.02
Forfeited	55	21.90
Outstanding at December 31, 2023	2,349	$	21.20

(a) In thousands

The Corporation amortizes the expense related to restricted stock awards as compensation expense over the vesting period specified in the grant's award agreement. Expense for restricted stock awards of $17 million was recorded for the year ended December 31, 2023, $16 million for the year ended December 31, 2022 and $15 million for the year ended December 31, 2021. Included in compensation expense for 2023 was $3 million of expense for the accelerated vesting of restricted stock awards granted to retirement eligible colleagues. The Corporation had $20 million of unrecognized compensation costs related to restricted stock awards at December 31, 2023 that are expected to be recognized over the remaining requisite service periods that extend predominantly through the first quarter of 2027.

The Corporation has the ability to issue shares from treasury or new shares upon the exercise of stock options or the granting of restricted stock awards. As described in Note 10, the Board of Directors has authorized management to repurchase shares of the Corporation’s common stock in the market, to be made available for issuance in connection with the Corporation’s employee incentive plans and for other corporate purposes. The repurchase of shares, if any, will be based on market and investment opportunities, capital levels, growth prospects, and regulatory constraints. Such repurchases may occur from time to time in open market purchases, block transactions, private transactions, accelerated share repurchase programs, or similar facilities.