First Foundation in Dallas has hired a new chief executive, the latest major shift in a transformative year for the beleaguered bank.
Banking industry veteran Thomas Shafer, 66, is coming out of retirement to take the reins from longtime CEO Scott Kavanaugh, the bank announced Friday.
Kavanaugh, who helped found the bank and has served in leadership positions there for 17 years, resigned from his C-suite role and board position Thursday. In a prepared statement, Kavanaugh said he's confident First Foundation will "thrive" under Shafer's leadership.
The incoming CEO is inheriting the role at a precarious time, as
In July, Fortress Investment Group
The bank has
Shafer isn't new to serving in top roles at banks that are going through massive change. He previously served as vice chairman of TCF Financial and CEO of its subsidiary, TCF National Bank,
Shafer served in his role at TCF until the bank was acquired by Huntington Bancshares in 2021. He then worked as Huntington's co-president of commercial banking and senior executive vice president until his retirement a year and a half later.
"We are excited to welcome Tom to First Foundation and look forward to his leadership in this new chapter," said Max Briggs, First Foundation's chairman, in a written statement. "He is a successful career bank executive bringing four decades of experience, including leadership at regional banks. I am confident that he will be able to guide the company to achieve our strategic objectives."
Briggs also thanked Kavanaugh, saying that his leadership "built the multi-state, financial services company that First Foundation is today."
Kavanaugh's decision to retire was "not the result, in whole or in part, of any disagreement with the company on any matters relating to the company's operations, policies or practices," First Foundation said in a public filing. Kavanaugh was 63 as of First Foundation's April proxy statement.
During a call with investors in July, Kavanaugh said the capital infusion was meant to boost the bank's growth. Despite First Foundation's risky exposure to commercial real estate debt, it wasn't prompted by regulatory concerns, he said.
"I am incredibly proud of what we built at First Foundation over the course of the last 17 years," Kavanaugh said at the time. "Much like our clients, we have evolved and have grown into the next chapter of the company's life."
The appointment of Shafer turns the page for the company.
As part of his contract, Shafer will receive an annual base salary of $1.09 million, nearly 14% more than Kavanaugh's annual base salary of $950,000. Shafer will also be eligible for an annual bonus of up to 1.5 times his annual base salary, based on specific performance targets. In 2021 and 2022, bonuses helped Kavanaugh more than double his salary. He didn't receive a bonus in 2023.
Shafer will also be granted 500,000 restricted stock units to vest over time.
The company's stock price was up 3.87% as of Friday early afternoon, trading at $8.07 per share.
