SouthState Corp. in Winter Haven, Florida, said its executive chairman, Robert Hill Jr., will step down from his position on April 26, when the company is scheduled to hold its annual meeting.
The $44 billion-asset company, formed by the
The circumstances of the separation with Hill, 56, entitled him to "severance under the terms of his employment agreement with the company," SouthState noted in the filing.
The company has appointed Doug Hertz as independent board chairman, effective at the end of Hill's term as executive chair. He will serve an initial one-year term.
Hertz, currently lead independent director of the company and its SouthState Bank subsidiary, is the former CEO of a privately-held beverage distributor in Georgia and a well-known philanthropist in the Southeast.
An executive chair is an employee of the company, while a nonexecutive chair is independent. Both lead the board and oversee the company's management team, though the latter is often viewed by investors as better positioned to objectively assess the performance of executives because of the formal employment separation.
"It is a good look," Christopher Marinac, director of research at Janney Montgomery Scott, said of the change at SouthState. "Investors care more and more about this."
Marinac said in an interview the change had long been discussed internally at SouthState and was not a surprise to him or other analysts who cover the company.
Director independence has long been a matter of debate among investors in banks and companies across myriad other industries, Marinac said. He noted that, in the case of executives viewed as proven star performers such as JPMorgan Chase Chairman and CEO Jamie Dimon, investors tend to look the other way. But among smaller companies, including community and regional banks, investors increasingly prefer board chairs to be independent.
"I think you may see other banks follow suit," Marinac said. "SouthState has prominence now, and other banks tend to follow the leader."
Hill joined SouthState in 1995 and became its president in 1999. Five years later he added the title of CEO, and he led the company for the next 16 years leading up to the merger with CenterState. When the companies combined, he moved into the role of executive chairman.
CenterState's CEO, John Corbett, became
SouthState emerged as the name of the combined bank, though CenterState's shareholders owned a majority of the stock at closing of the $3.2 billion merger.
In an interview after the deal was finalized, Corbett said the purpose of the deal was to build a bigger, more efficient company that could invest more in technology. Corbett said the pandemic only heightened the importance of size and robust
"This industry is evolving, and it is incumbent on us to evolve with it. A lot of it is extracting costs from the brick-and-mortar system and investing it back into the digital transformation," he said.
SouthState did not provide details about why it had decided 2023 was the time to make its chairman independent. But it noted in the regulatory filing that its separation and transition agreement with Hill would be filed as an exhibit with the company's first-quarter regulatory filing following its earnings report in April.
