ISBC 2017 Form 10-K & 2018 Proxy Statement

34 15.87% 14.75% 13.94% 2015 2016 2017 Capital Levels Common Equity Tier 1 Ratio 1.9% 16.9% 32.3% One year Two year Three year Total Shareholder Return period ending December 31, 2017 (1) Net income for the year ended December 31, 2017 is adjusted to exclude $49.2 million of income tax expense related to the enactment of the Tax Cuts and Jobs Act in December 2017 and $3.7 million of severance and branch closure costs related to the workforce reduction and branch closures announced in December 2017. Role of Executive Officers The Compensation and Benefits Committee is responsible for designing our executive compensation program. When appropriate, the Chief Executive Officer and Chief Operating Officer will provide the Committee with the information it needs to make well-informed and appropriate decisions. The Chief Executive Officer and Chief Operating Officer participate in Committee meetings purely in an informational and advisory capacity and have no votes in the Committee’s decision-making process. The Compensation and Benefits Committee will meet with the Chief Executive Officer and Chief Operating Officer regarding the potential incentive compensation performance metrics, including their respective weightings, and to review the progress towards the achievement of the pre-established corporate financial targets and individual performance goals related to our cash and equity incentive plans. Also, the Committee requires the Chief Executive Officer and Chief Operating Officer to provide the Committee with performance assessments and compensation recommendations for each of the other Named Executive Officers, which are considered by the Compensation and Benefits Committee in arriving at its compensation determinations. The Chief Executive Officer and Chief Operating Officer do not attend portions of committee meetings during which their performance is being evaluated or their compensation is being determined. The Compensation and Benefits Committee uses executive session to determine appropriate actions to be taken. Role of Compensation Consultant For 2017, the Compensation and Benefits Committee engaged GK Partners, an independent compensation consultant, to assist in its evaluation of Investors Bancorp’s executive compensation program and provide an annual competitive evaluation of the total compensation of the Named Executive Officers. GK Partners reported directly to the Compensation and Benefits Committee, and did not perform any other services to Investors Bancorp or Investors Bank. GK Partners provided the Compensation and Benefits Committee with executive compensation benchmarking trends and external developments, and also provided input on Investors Bancorp and Investors Bank's overall compensation program, and monitored their short-term and long-term incentive plans for best practices and market competitiveness. The Compensation and Benefits Committee considered the independence of GK Partners under the Securities and Exchange Commission rules and NASDAQ corporate governance listing standards. The Compensation and Benefits Committee requested and received a report from GK Partners regarding its independence, including information relating to the following factors: (1) other services provided to Investors Bancorp by GK Partners; (2) fees paid by Investors Bancorp as a percentage of GK Partners’ total revenue; (3) policies or procedures maintained by GK Partners that are designed to prevent a conflict of interest; (4) any business or personal relationships between the senior advisors and any member of the Compensation and Benefits Committee; (5) any Investors Bancorp common stock owned by the senior advisors; and (6) any PROXY STATEMENT