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Nominee For Director
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Director
Since
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Age
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Company Position(s)
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Javier de Anda
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2015
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64
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Director
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Irving Greenblum
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1981
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86
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Director(1)(2)(3)
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R. David Guerra*
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1993
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63
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Vice President; President of IBC McAllen Branch; Director
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Douglas B. Howland
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2010
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65
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Director(1)(2)(3)
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Imelda Navarro*
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2002
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58
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Treasurer; IBC President; Director
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Peggy J. Newman
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1997
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84
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Director(3)
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Dennis E. Nixon*
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1975
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73
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Chairman of the Board and President; IBC Chief Executive Officer; Director
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Larry A. Norton
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2010
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69
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Director(1)(2)(3)
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Roberto R. Reséndez
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2015
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66
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Director
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Leonardo Salinas
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1976
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82
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Director(1)
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Antonio R. Sanchez, Jr.
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1995
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73
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Director
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*
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Executive
Officer of the Company
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(1)
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Member
of the Audit Committee
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(2)
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Member
of the Nominating Committee
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(3)
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Member
of the Compensation Committee
The
business experience for the past five years of each of the director nominees is set forth below, and includes information regarding the person's experience, qualifications,
attributes or skills that led the Nominating Committee and the Board of Directors to the conclusion that the person should serve as a director for the Company. Each director nominee other than
Mr. Sanchez is also a director of IBC. None of the director nominees nor executive officers of the Company have a family relationship with any of the other nominees or executive officers,
except for Mr. de Anda who is Mrs. Newman's son-in-law.
Javier de Anda
joined our Board of Directors in September 2015 and the board of IBC Laredo in July 2015. Mr. de Anda is a Laredo
native and has been a member of the board of IBC's subsidiary bank, Commerce Bank, since March 2010. He currently serves as the Senior Vice-President of B.P. Newman
3
Investment Co.,
a private real estate company and apartment building operator founded in 1968 in Laredo, and currently co-owns 20 Popeye's Louisiana Kitchen franchises in the Laredo and
El Paso area, which employs more than 300 people. His achievements led to his induction into the Laredo Junior Achievement Business Hall of Fame. Mr. de Anda's extensive ties to local
community and business leaders, demonstrated leadership skills, entrepreneurial business experience and his significant knowledge of the markets that we serve, as well as his long-standing service as
a director for Commerce Bank, have led the Board to conclude that he should continue serving on our Board.
Irving Greenblum
has been one of our directors since 1981, and a director of IBC for the same period. Mr. Greenblum is a private
investor and has been involved in international opportunities and real estate investments in the Laredo business community for over fifty years. In addition to his demonstrated leadership skills, his
business experience, his long-standing service to the Company and very active role as a director of the Company, as well as his knowledge of the Texas communities we serve; have led the Board to
conclude that Mr. Greenblum should continue serving on our Board.
R. David Guerra
is Vice President of the Company, and has been one of our directors since 1993 and an officer of the Company since 1986.
He has been a director and president of the IBC Branch in McAllen, Texas since our 1991 expansion into that area. An honors graduate from Texas A&M, Mr. Guerra's extensive experience in banking
and financial services and his long-standing service to the Company, as well as his knowledge of the Texas communities we serve, have led the Board to conclude he should continue serving on our Board.
Douglas B. Howland
has been a director since 2010, and has served on the board of our subsidiary bank, Commerce Bank for over twenty years
before becoming one of our directors. Mr. Howland served as the chief executive officer of Libcon, Inc., a privately-held construction company in Laredo until its sale April 2011, and as
a private investor since that time. He has served as director of the Laredo Development Foundation for 15 years and continues to be an active member of the Laredo business and non-profit
communities. Mr. Howland has a bachelor of science degree in civil engineering from Texas A&M University. In addition to his role as one of our independent directors,
Mr. Howland's experiences in preparing, analyzing or evaluating financial statements, as well as his experience in business operations and management and knowledge of the Texas communities we
serve, have led the Board to conclude that Mr. Howland should continue serving on our Board.
Imelda Navarro
has been a director of the Company since 2002, and the Company Treasurer since 1982. Ms. Navarro has also served as
the senior executive vice president and a director of IBC since 2002, and was named President of IBC in September 2015. In addition to her experience in banking and financial services,
Ms. Navarro's years of experience as an executive officer of the Company, as well
as her knowledge of the communities we serve, have led the Board to conclude that Ms. Navarro should continue serving on our Board.
Peggy J. Newman
has been one of our directors since 1997, and a director of IBC since 1997. Ms. Newman has been a private real
estate investor through various entities. She is currently and has been president of B.P. Newman Investment Co., Inc. located in Laredo, Texas for more than five years.
Ms. Newman's experience in preparing, analyzing and evaluating financial statements, her experience in business operations and management, her long service to the Company and very active role
as a director of the Company, and her knowledge of the Texas communities we serve, have led the Board to conclude that Ms. Newman should continue serving on our Board.
Dennis E. Nixon
has served IBC as its chief executive officer since 1975, and was also president of IBC during that same period until
September 2015. Mr. Nixon has also served as the Company's chairman and president since 1979. With over 40 years of experience working in the banking industry in Texas and serving as our
chief executive officer for most of that time, Mr. Nixon brings outstanding leadership skills and a deep understanding of the local banking market and issues facing the banking industry, as
well as his
4
knowledge
of the communities we serve, that led the Board to conclude that Mr. Nixon should continue serving on our Board.
Larry A. Norton
has been one of our independent directors and a director of IBC since 2010, and served on the board of our subsidiary
Commerce Bank for over twenty-five years. He has been the President of Norton Stores Inc., a family retail sales business, and owner of Larry A. Norton & Co., a retail computer
sales company, for more than thirty years. He has served as president of the Laredo Chamber of Commerce with close ties to the Laredo business and non-profit communities. In addition to his experience
reviewing financial statements and financial matters, Mr. Norton's experiences in business operations and management, as well as his knowledge of the Texas communities that we serve, have led
the Board to conclude that Mr. Norton should continue serving on our Board.
Roberto R. Reséndez
was appointed to our Board in July 2015. Mr. Reséndez has more than thirty years'
experience as an owner and operator of a ranching operation in Mexico. Mr. Reséndez has a bachelor of science degree in industrial engineering from Texas A&M University.
He also has real estate holdings and investments in Laredo and Mexico. As one of our independent directors, Mr. Reséndez has the leadership skills and experience in reviewing
financial statements and financial matters that has led the Board to conclude that he should continue serving on our Board.
Leonardo Salinas
has been a director since 1976 and served as vice president of the Company and senior executive vice president of IBC
until his retirement in 2000. Mr. Salinas is one of our independent directors and is involved in real estate investments in Laredo. In addition to his experience in the banking and financial
services industry, his long-standing service as a director and former officer of the Company, as well as his knowledge of the communities we serve, that led the Board to conclude that
Mr. Salinas should continue serving on our Board.
Antonio R. Sanchez, Jr.
has been a director of the Company since 1995, and for more than five years has been the chairman of Sanchez
Oil & Gas Corporation and Sanchez Energy Corporation, an independent oil and natural gas exploration and production company required to file reports with the SEC as a public company. In
addition to his long public company leadership experience, Mr. Sanchez's experience in business operations and management and his long-standing service as a director of the Company, as well as
his knowledge of the Texas communities we serve, that have led the Board to conclude that Mr. Sanchez should continue serving on our Board.
Vote Required
If a quorum exists, the nominees for director receiving a majority of the votes cast
(
i.e.
, the number of shares voted "for" a director nominee exceeds the number of votes cast "against" that nominee), will be elected as directors. Votes
cast will include only votes cast with respect to shares present in person or represented by proxy at the meeting and entitled to vote and will exclude abstentions. Therefore, shares not present, at
the meeting, broker non-votes and shares voting "abstain" have no effect on the election of directors.
The Board of Directors recommends a vote "FOR" each named nominee.
CORPORATE GOVERNANCE
The Company is committed to sound corporate governance practices. In the past several years, the Board of Directors has implemented a
number of enhancements to our corporate governance practices, including adopting a majority vote standard for uncontested director elections in 2013. The Board also formed a Risk Committee and adopted
a written Risk Committee Charter that same year. During the first quarter of 2015, the Board formed a Nominating Committee
of independent directors to identify qualified candidates for nomination to the Board, as discussed further below.
5
Our Common Stock is listed on the Nasdaq Global Select Market, which listing rules require that a majority of our directors be
"independent directors," as defined in the Nasdaq Marketplace Rules. The Board has affirmatively determined that all of the Company's directors, other than Messrs. Guerra, Nixon and Sanchez, as
well as Ms. Navarro, are independent directors under the Nasdaq listing rules.
During 2015, the Board of Directors held seven meetings. All of the directors attended at least 75% of the aggregate of the total
number of meetings of the Board and the total number of meetings held by all committees of the Board on which such director served. The Board also took action on a number of occasions as needed
without a physical meeting in the form of unanimous written consents. In addition, non-employee directors meet periodically in executive session without members of management present. The non-employee
directors met in executive session seven times during 2015.
The Board of Directors has established a Nominating Committee, which operates under a formal written charter adopted by the Board. The
Nominating Committee recommended each of the current director nominees, which recommendation was subsequently
confirmed by the Board of Directors. The Nominating Committee Charter is available on the Company's website at www.ibc.com. under the heading "Investors-Corporate Governance."
The
Nominating Committee is comprised of three directors, as determined by the Board, each of whom satisfies the independence requirements of the Nasdaq Marketplace Rules, and has
experience that, in the business judgment of the Board, would be helpful in addressing the matters delegated to the Committee. The independent directors utilize a variety of methods for identifying
and evaluating director nominees. The Nominating Committee Charter sets forth criteria that the Committee may consider, among other criteria deemed appropriate by the Committee, in recommending
candidates for election to the Board. The Board has no formal policy regarding diversity, but diversity is considered when evaluating nominees because the Board believes it is beneficial to the
Company for directors to reflect the diversity of the Company's markets. The Company also does not have formal stock ownership guidelines for directors, but ownership of our Common Stock by a director
candidate is a factor that was considered by the Nominating Committee in connection with its recommendation of the existing directors for an additional term.
The
Nominating Committee will consider director candidates recommended by shareholders if provided with the following: (i) evidence, in accordance with Rule 14a-8 under the
Exchange Act, of compliance with shareholder eligibility requirements; (ii) the written consent of the candidate(s) for nomination as a director and verification as to the accuracy of the
biographical and other information submitted in support of the candidate; (iii) a resume or other written statement of the qualifications of the candidate(s) for nomination as a director; and,
(iv) all information regarding the candidate(s) and the submitting shareholder that would be required to be disclosed in a proxy statement filed with the SEC if the candidate(s) were nominated
for election to the Board of Directors. Any recommendations received from shareholders will be evaluated in the same manner that other potential nominees are evaluated. Any shareholder that wishes to
present a director candidate for consideration should submit the information identified above pursuant to the procedures set forth below under "Shareholder Communication with the Board of Directors."
With respect to the timing of shareholder nominations for the 2017 Annual Meeting, please see the discussion set forth below under "Shareholder Proposals For 2017 Annual Meeting." The Company received
no nominations of board candidates from our shareholders for the Annual Meeting.
6
Although the Company does not have a formal policy regarding director attendance at annual shareholder meetings, directors are expected
to attend these meetings absent
extenuating circumstances. All of our then current directors were in attendance at last year's annual shareholder meeting.
The Board of Directors has adopted the International Bancshares Corporation Code of Ethics and Conflicts of Interest Policy, which is
available on the Company's website at www.ibc.com. The Code of Ethics and Conflicts of Interest Policy applies to all directors, officers and employees of the Company. Certain sections of the Policy
only apply to financial professionals of the Company. Any amendment to, or any waiver applicable to any of our directors, executive officers or senior financial officers of, the Code of Ethics and
Conflicts of Interest Policy will be disclosed on our website within the time period required by the SEC and the Nasdaq Global Select Market.
Shareholders may communicate directly with the Board of Directors. All communications should be in writing and directed to the
Company's Corporate Secretary, Marisa V. Santos, at International Bancshares Corporation, P. O. Drawer 1359, Laredo, Texas 78042, and should prominently indicate on the outside of the envelope that it
is intended for the Board of Directors. The Corporate Secretary has the authority to disregard any inappropriate communications or to take other appropriate actions with respect to any such
inappropriate communications. If deemed appropriate, the Corporate Secretary will forward correspondence to the Chairman of the Board or any specific director or Committee to whom the correspondence
is directed. In general, communications relating to corporate governance and long-term corporate strategy are more likely to be forwarded than communications relating to ordinary business affairs,
personal grievances and matters as to which the Company tends to receive repetitive or duplicative communications. Also, pursuant to our restated Bylaws, a special meeting of shareholders shall be
called by the Chairman of the Board, President or Secretary of the Company whenever shareholders holding at least fifty percent (50%) of all the shares entitled to vote at the proposed special meeting
make application therefore in writing, which request must state a proper purpose of the meeting and shall be delivered to the Chairman of the Board or the President.
Pursuant to our Bylaws, the president is the Company's chief executive officer, or CEO. The Bylaws also provide that the Board of
Directors appoint one of its members to be its Chairman, which is not considered to be an officer position of the Company. The Board does not have a policy on whether the role of Chairman and CEO
should be separate or combined, but currently believes that the most effective leadership structure for the Company is to combine these responsibilities. The structure avoids duplication of efforts
that can result from the roles being separated and avoids confusion within and outside of the Company with respect to who is the highest ranked officer of the Company. The Board also believes that
combining these roles enhances accountability for the Company's performance by avoiding confusion about who is the highest ranked officer. Furthermore, as the Company has combined these roles for
almost twenty years, separating them could cause significant disruption in oversight and lines of reporting. Nevertheless, depending upon the circumstances, the Board could choose to separate the
roles of Chairman and CEO in the future.
The
Company does not have a designated lead independent director. In this regard, the Board of Directors believes that the composition of the Board and the very active involvement by the
independent directors create a Board culture that is effective and promotes the consideration of the varied views of all of the directors of the Company. Seven of the eleven directors of the Company
are "independent" as
7
defined
in the applicable Nasdaq Marketplace Rules. Further, to help ensure oversight by our independent directors, our Audit, Compensation, Stock Option, Nominating and Long-Term Restricted Stock
Unit Committees are all composed only of independent directors. In addition, the Board does not limit the tenure of its directors, but considers the tenure of the director and the level of involvement
of the director on the Board, along with all the other attributes and qualities of the director, in determining whether to approve a director as a nominee for election as a director.
The
Company has a succession plan for its CEO, as well as the chief executive officers of the twelve banking centers of the Company. The succession plan focuses on an internal growth
strategy. The Company has developed a management structure that emphasizes development from within, but also allows for the addition of qualified leadership from outside the Company when the
circumstances warrant such action. The Company's decentralized operating platform enables the Company to grow and mature its executive management team. There are a number of banking center chief
executive officers that have served in such capacity for over twenty years. It is contemplated that the Board with the advice and counsel of Mr. Nixon, the current long-standing CEO, will at
the time deemed
appropriate by the Board, select a new CEO by choosing one of the banking center CEOs; although the succession plan would allow the Board to recruit a new CEO if it chooses to do so.
The Board of Directors is actively involved in overseeing risk management for the Company. The Company's senior risk officers provide a
comprehensive risk report to the Board. The Board also engages in periodic risk management discussions with the senior risk officers, CEO, chief financial officer and other Company officers as the
Board may deem appropriate. All of the directors of the Company, except for Mr. Sanchez, are also directors of IBC, which represents over a majority of the Company's banking assets. As such,
the Board also receives regular reports on risk management matters of IBC.
In
2013, the Board of Directors established a Risk Committee and adopted a written Risk Committee Charter. The Risk Committee is appointed by the Board to assist the Board in fulfilling
its oversight responsibilities with regard to the Company's risk management. The Chair of the Risk Committee must be "independent," as defined in the Nasdaq Marketplace Rules. Currently, all of the
members of the Risk Committee are independent directors. In addition, each other committee of the Board has been assigned oversight responsibility for specific areas of risk. For example, the
Compensation Committee considers risks that may result from changes in the Company's compensation programs, while the Asset/Liability, Investment, Balance Sheet-Management, Funds Management/Liquidity
Interest Rate Risk Committee focuses on risk related to credit and interest rates, among others. The Audit Committee reviews risk related to our financial reporting.
Our
senior risk officers report directly to the Board of Directors and indirectly to the CEO for administrative purposes. The Board believes that the combination of the joint CEO and
Chairman positions and the roles of the Board and its committees provide the appropriate leadership to help ensure effective risk oversight. In light of recent regulatory developments, the Company is
currently evaluating its Risk Committee Charter and intends to amend the charter as needed to comply with any changing regulatory requirements, including adding a risk management expert whose risk
management experience is commensurate with the Company's structure, risk profile, complexity and size.
At December 31, 2015, the Board of Directors had eight active committees: Audit Committee; Compensation Committee; Nominating
Committee; Stock Option Plan
Committee; Asset/Liability, Investment, Balance Sheet-Management, Funds Management/Liquidity Interest Rate Risk Committee; Long-Term Restricted Stock Unit Plan Committee; Profit Sharing Plan
Committee; and Risk Committee.
8
The Audit Committee of the Board of Directors during 2015 consisted of Irving Greenblum, Leonardo Salinas, Douglas B. Howland and Larry
A. Norton. The Audit Committee met six times during the 2015 fiscal year. The Audit Committee oversees the accounting and financial reporting of the Company and its primary functions are to recommend
the appointment of the independent auditors; to review annual and quarterly financial reports; and to review the results of audits by the internal auditor and the independent auditors. Under
applicable law, the Audit Committee is required to review with management and the independent auditors the basis for all financial reports. The Board of Directors has adopted a separate Audit
Committee Charter. The charter for the Audit Committee is available on the Company's website at www.ibc.com under the heading "InvestorsCorporate Governance."
The
Board of Directors has determined that Douglas B. Howland is an "audit committee financial expert" as defined by the SEC regulations due to the relevant experience he has gained from
serving as the chief executive officer of Libcon, Inc. for over twenty years, serving on the Audit Committee of the Company for almost five years, as well as his position as the Chairman of the
Audit Committee. All Audit Committee members are "independent" as defined in the applicable Nasdaq Marketplace Rules, and each has been selected for the Audit Committee by the Board based on the
Board's determination that they are fully qualified to (i) review and understand the Company's financial statements, (ii) monitor the performance of management, (iii) monitor the
Company's internal accounting operations, (iv) monitor the independent auditors, and (v) monitor the disclosures of the Company to the end that they fairly present the Company's
financial condition and results of operations. In addition, the Audit Committee has the authority on its own to retain independent accountants or other consultants whenever it deems appropriate;
although it did not exercise that authority during 2015.
As
of December 31, 2015, management assessed the effectiveness of the design and operation of the Company's internal controls over financial reporting based on the criteria for
effective internal control over financial reporting established in "Internal ControlIntegrated Framework," issued by the Committee of Sponsoring Organizations (COSO) of the Treadway
Commission in 1992. Based on that assessment, management determined that the Company maintained effective internal control over financial reporting as of December 31, 2015, based on those
criteria.
During 2015, the Long-Term Restricted Stock Unit Plan Committee consisted of Irving Greenblum, Peggy J. Newman and Larry A.
Norton. The Long-Term Restricted Stock Unit Plan Committee did not meet during the 2015 fiscal year. Its primary function is the administration of the 2009 International Bancshares Corporation
Long-Term Restricted Stock Unit Plan, which includes determining the form, terms, conditions and amount of each grant under such Plan. The Long-Term Restricted Stock Unit Plan Committee has the
authority to retain outside consultants or separate legal counsel, which authority it did not exercise during 2015. Each member of the Long-Term Restricted Stock Unit Plan Committee is "independent",
as defined in applicable Nasdaq Marketplace Rules. The Long-Term Restricted Stock Unit Plan was adopted while the Company was a participant under the TARP program. The Company exited the TARP program
in 2012 and the Company does not intend to grant any additional Long-Term Restricted Stock Units during this fiscal year or in the foreseeable future.
Asset/Liability, Investment, Balance Sheet-Management, Funds Management/Liquidity Interest
Rate Risk Committee
The Asset/Liability, Investment, Balance Sheet-Management, Funds Management/Liquidity Interest Rate Risk Committee consisted of Dennis
E. Nixon, Irving Greenblum, R. David Guerra, Douglas B. Howland and Larry A. Norton during 2015. The Committee met twice in 2015 and all of its members were present at such meetings except for
Mr. Guerra who missed one of the meetings. The primary function of
9
the
Asset/Liability, Investment, Balance Sheet-Management, Funds Management/Liquidity Interest Rate Risk Committee is to administer the investment activity of the Company, including the review of
regulatory compliance.
During 2015, the Profit Sharing Plan Committee consisted of Irving Greenblum, Peggy J. Newman, Dennis E. Nixon and Larry A.
Norton. The Company has a deferred profit sharing plan for full time employees with a minimum of one year of continuous employment. The Profit Sharing Plan Committee met once during 2015 and all of
its members were present. The primary function of the Profit Sharing Plan Committee is to administer the Employee's Profit Sharing Plan.
In November 2013, the Board of Directors formed a Risk Committee and adopted a written Risk Committee Charter, which is posted on the
Company's website at www.ibc.com under the heading "InvestorsCorporate Governance." The primary function of the Risk Committee is to assist the Board in fulfilling its oversight
responsibilities with regard to the Company's risk structure and risk management, and overseeing policies relating to the Company's risk management and its compliance with regulatory obligations.
During 2015, the Risk Committee consisted of Irving Greenblum, Douglas B. Howland and Larry A. Norton. The Risk Committee met seven times during 2015 and all of its members were present at each.
The Nominating Committee was formed by the Board of Directors during the first quarter of 2015, and consists of Douglas B. Howland,
Irving Greenblum, and Larry A. Norton. The Committee met twice during 2015 with all of its members present at the meeting, except for Mr. Norton that missed one of the meetings. The primary
function of the Nominating Committee is to identify and recommend qualified candidates to become Board members. Also, the Nominating Committee shall, at least annually, review the Board's annual
review of its performance and consider the results of such evaluation when determining whether or not to recommend the nomination of existing directors for an additional term.
During 2015, the Stock Option Plan Committee consisted of Irving Greenblum, Peggy J. Newman and Larry A. Norton. The Stock Option Plan
Committee met three times during 2015 and all members of the committee were present at such meetings. The Stock Option Plan Committee's primary function is the administration of the 2012 International
Bancshares Corporation Stock Option Plan, which includes taking all final action on the amount, timing, price and other terms of all options granted under such Plan. The Stock Option Plan Committee
has the authority to retain outside consultants or separate legal counsel, which authority it did not exercise during 2015. Each member of the Stock Option Plan Committee that served during 2015 and
who is serving in 2015 is independent as defined in applicable Nasdaq Marketplace Rules.
Since all cash compensation paid to executive officers of the Company is paid by the Company's lead bank subsidiary, IBC, the Salary
and Steering Committee of IBC's Board of Directors is responsible for making recommendations to the IBC Board of Directors regarding each executive officer's cash compensation. Each member of the
Compensation Committee is also a member of the Salary and Steering Committee of IBC, and an independent director, as defined in the applicable Nasdaq Marketplace Rules. The Compensation Committee has
the authority to retain outside consultants or separate legal counsel,
10
which
authority the Compensation Committee did not exercise during 2015. The Compensation Committee during 2015 consisted of Irving Greenblum, Douglas B. Howland, Jr., Peggy Newman and Larry Norton.
The Compensation Committee met twice during the 2015 fiscal year with all members attending each of such meetings. . The Board of Directors adopted a written Compensation Committee Charter that is
posted on the Company's website at www.ibc.com under the heading "InvestorsCorporate Governance."
None of the members of the Compensation Committee or the Stock Option Plan Committee was an officer or employee of the Company or any
of its subsidiaries in 2015, nor was any member formerly an officer or employee of the Company or any of its subsidiaries, except for Mr. Salinas who, before he retired in 2000, was a Vice
President of the Company and a Senior Executive Vice President of IBC. Some of the members of the Compensation Committee, and some of these members' associates, are current or past customers of one or
more of the Company's subsidiary banks. Since January 1, 2015, no transactions between these persons and such subsidiaries have occurred, other than borrowings. In the opinion of management,
all of the borrowings have been in the ordinary course of business, have had substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable
transactions with other persons and did not involve more than the normal risk of collectability. Additional transactions may take place in the future.