KeyCorp Announces Board Changes
KeyCorp made significant announcements regarding its board structure, following criticism from activist investor HoldCo Asset Management. The changes come in the wake of calls for CEO Chris Gorman’s dismissal and allegations of underperformance over the past 25 years.
New Lead Independent Director
KeyCorp appointed Dollar General CEO Todd Vasos as the bank’s lead independent director, succeeding Alexander M. “Sandy” Cutler. Vasos, who joined the board in 2020, brings a wealth of experience to the role. Cutler, with a tenure of 10 years as lead independent director and board member since 2000, guided KeyCorp through significant industry changes.
Retirement of Directors
Directors Carlton Highsmith and Ruth Ann Gillis will retire at KeyCorp’s upcoming annual meeting on May 14. In their place, the bank has nominated BlackRock veteran Antonio DeSpirito and Truist veteran Christopher Henson. Both nominees boast impressive backgrounds in capital markets, banking operations, and financial oversight.
Activist Investor’s Criticism
Last month, HoldCo Asset Management, which holds a $140 million stake in KeyCorp, criticized the board’s performance over the years. The investor alleged that Cutler oversaw significant underperformance and dilution tax issues. HoldCo also asserted that every director at KeyCorp had failed their constituents.
Response to Criticism
In response to the criticism, KeyCorp emphasized its commitment to strong corporate governance and long-term shareholder value creation. The bank’s spokesperson highlighted the board’s dedication to these principles, echoing sentiments from the official press release.
Continued Pursuit of Strategy
KeyCorp remains focused on executing its strategy to drive disciplined growth, enhanced profitability, and shareholder value. The newly appointed directors, DeSpirito and Henson, are expected to support the bank in achieving its objectives and creating value for shareholders.
Activist Investor’s Track Record
HoldCo Asset Management has been active in the banking sector, advocating for changes to drive value for shareholders. The firm previously urged Comerica to sell and raised concerns about the Fifth Third acquisition. Despite legal challenges, the deal received regulatory approval last week.
Conclusion
KeyCorp’s board changes signal a proactive approach to addressing shareholder concerns and enhancing corporate governance. The appointments of Todd Vasos, Antonio DeSpirito, and Christopher Henson reflect the bank’s commitment to driving growth and value creation. As KeyCorp moves forward with its strategic initiatives, stakeholders will be closely watching to see the impact of these changes.
