By Michael Roknick
HERMITAGE — There’s going to be a familiar face guiding FNB Corp.
The Hermitage-based company on Tuesday announced Sharpsville native Steve Gurgovits will permanently take the post of chief executive officer and president. The appointment is effective immediately.
This is the second time at the helm for Gurgovits who may have claim to the shortest retirement in banking history. He turned over FNB’s CEO and president’s title to Bob New in January 2008 but stayed aboard to assist him until Jan. 1 this year and maintained his title as company chairman. Within weeks, Gurgovits was called back to help mediate a rift between New and FNB’s board.
A Texas native, New was always considered an outsider and his business style at times clashed with longtime board members. A planned junket to a Mexican resort to reward top-performing employees also stirred the pot — particularly after the company posted a fourth quarter loss and cut its dividend in half.
In February, New and the board “mutually agreed to terminate their relationship,’’ according to a news release.
His release came at a stiff price: FNB paid him $990,000 as part of a settlement agreement and another $748,000 for his Hermitage home.
Gurgovits was asked by the board to return in an interim role, while a search began for a successor and he maintained his title as company chairman. One of his first orders helped soothe raw emotions: He nixed the Mexican trip.
As part of Tuesday’s announcement, FNB said a new chairman is expected to be named later this month. Further, two promotions were announced. Vincent Delie Jr. was named FNB’s executive vice president and chief revenue officer and Brian Lilly, executive vice president and chief operating officer.
Delie, who also serves as president of Banking Group for FNB’s First National Bank of Pennsylvania affiliate, will be responsible for overseeing revenue growth for FNB and its affiliates. With 22 years of banking experience, he joined First National in 2005 as president and CEO of its Pittsburgh region.
Lilly, who also serves as FNB’s chief financial officer, will be responsible for management support, business planning and overseeing administration of all operations. With 29 years of banking experience, he joined FNB in 2003.
Almost immediately upon Gurgovits’ return in February, talks began for his permanent return.
“I took some time to think about it and the board took some time to think about it,’’ Gurgovits said Tuesday. “I think the thinking behind this is that things have been going pretty well.’’
A lifelong resident of the area, Gurgovits, who is soon to be 66, is seen as someone who intimately knows FNB’s market, employees and customer base. With the economy and banking industry still trying to claw their way out of a deep recession, board members believed it wasn’t a good time to bring in another outsider to run the company.
“When looking at the complexities of the economic environment and the momentum needed for FNB’s continued success, Mr. Gurgovits’s qualifications are unmatched,” said Stephen Martz, an FNB board member and chairman of its search committee. “He has the industry knowledge ... and intimate knowledge of FNB to achieve its vision for the future,’’
Gurgovits said this isn’t going to be a quick in-and-out position for him; he committed to remain at his post for more than a couple of years.
Unlike New who worked under an employment contract that precipitated the huge severance package, Gurgovits said he has no written agreement.
“I didn’t want an employment contract,’’ Gurgovits said. “It gives the company all the flexibility in the world. They can end this anytime they want without paying me a big truckload of money to go away.’’
Things have already begun brightening for FNB with first-quarter profits higher than expected.
One of Gurgovits’ priorities is to pay back $100 million First National took from the federal Troubled Asset Relief Program in January. Banks were given the bailout funds as a way to inject more money into the economy through loans.
But that repayment isn’t going to come quickly.
“I could give it back today,’’ Gurgovits said. “But I don’t see the economic indicators showing that the worst is over. I still think we have a ways to go.’’
As for any near-term chances of FNB upping its dividend, Gurgovits would only say he hopes total shareholder returns will be in the 10 to 12 percent range, which he expects will be half in dividends and half in earnings growth.
Tracing its roots back to the Civil War, FNB is one of the very oldest companies in Mercer County, employs more than 1,000 in the region and has assets of $8.5 billion.
“I think FNB is a rock-solid bank well positioned in the marketplace,’’ Gurgovits said. “I can’t tell you how pleased I am to be a part of this.’’
