M&T Bank didn't name a president to succeed the late Mark J. Czarnecki, leaving open the question about who is the clear choice to one day succeed Robert G. Wilmers as CEO of the prominent, Buffalo-based institution.
Instead, the bank chose to split Czarnecki's duties among its three vice chairmen: Rene F. Jones, Richard S. Gold and Kevin J. Pearson.
"There's a pretty deep bench of executives that M&T has that can step up and take over, and I think that's a good problem for M&T, that there's three guys in that spot who could be the next CEO," said Brian Klock, an analyst at Keefe, Bruyette & Woods.
Some see M&T's decision as creating a competition within the bank's highest ranks, to determine who could one day step into the role of CEO. Wilmers, 82, has given no indication of plans to retire, and he remains a respected voice in the banking industry.
All three of the M&T vice chairmen are in their 50s and have been with M&T since the late 1980s or early 1990s, reflecting M&T's tendency to promote from within for top roles.
Jones, 52, is probably the best known of the three outside of M&T. For 11 years, he served as the bank's chief financial officer, providing quarterly updates to analysts and speaking at conferences. He will continue to run the bank's Wilmington Trust and Treasury Division, but will also have responsibility for human resources and the bank's Buffalo Promise Neighborhood initiative.
Gold, 56, has served as chief risk officer since 2014, but will leave that role. He will assume responsibility for retail banking, business banking, mortgage and consumer lending and marketing. He also will maintain responsibility for the bank's legal division.
Pearson, 55, will continue to run the bank's commercial and credit divisions, and will add responsibility for the technology and banking operations division.
"Is the board trying to point to one of these guys?" Klock said. "It's hard to tell, because all three have significant responsibilities."
Klock said Wall Street is more familiar with Jones, but he wouldn't be surprised to see Gold and Pearson given more opportunities to be visible, "because (M&T will) have the Street being comfortable with any of those three guys, besides knowing Rene very well."
Czarnecki, who died in February, was the bank's No. 2 executive behind Wilmers, and considered by observers a potential successor. Czarnecki, who earned praise across his 40-year career at the bank, was named president in 2007 and added the duties of chief operating officer in 2014.
Wilmers in a statement said Czarnecki's career was marked by "wide-ranging assignments and ever-growing responsibilities."
"While it is difficult to replace Mark and restructure his duties, this necessary task is more manageable because we're carrying on his career tradition, and because his responsibilities are being passed to strong and experienced leaders who have followed in Mark's footsteps," Wilmers said.
Why did M&T choose to divide up Czarnecki's duties among the vice chairmen rather than name another president?
"It's consistent with the way executives have advanced at M&T over the years," said C. Michael Zabel, an M&T spokesman. "It's what the board agrees is the best leadership model for the company at this point in time."
M&T has coped with two high-level losses to its leadership in recent years: Czarnecki, and Michael Pinto, a vice chairman who died in 2014 at age 58.
Before Pinto scaled back his duties at the bank due to illness, observers had also considered him a possible future CEO at M&T. After Pinto died, M&T gave increased responsibilities to Czarnecki, Jones and Pearson.
Richard Bove, an analyst at Rafferty Capital, sees a risk in the approach M&T is taking with its leadership model.
Bove recalled how Citicorp in 1984 chose from among three internal contenders to succeed Walter Wriston as chairman and CEO. John Reed eventually prevailed, but Bove said the process was "divisive."
"What happened is, each one of the three had their specific lieutenants who lined up behind their leader and worked hard to show they were the best group," Bove said. "They did not cooperate with each other.
"It's far more effective to take one person and say, 'This is the guy,' and have him selected, everybody knows who he is, everybody then changes their alliances to the guy, everybody moves forward together."
M&T could be different, Bove noted.
"Who knows? Maybe these guys are better than the people were down in New York City and therefore they won't fight with each other, nor will their followers fight with each other," Bove said.
M&T, meanwhile, will keep "chugging along" without a president and with Wilmers in charge, Klock said. "But there's three guys you can hand it off to that know the culture and you probably shouldn't see a significant change, either."
M&T's leadership announcement didn't make waves with the bank's stock price, which closed at $154.49 per share on Monday, down 24 cents.
M&T also made three other leadership announcements on Monday:
- John D'Angelo, 54, was promoted to executive vice president and named the bank's new chief risk officer. He has run M&T's audit function for the past 11 years.
- Neil Hosty, 41, who is responsible for retail banking and business banking, was promoted to executive vice president.
- Julie Urban, 45, was promoted to senior vice president and named general auditor.