Ally names Discover CEO to its top post

Dive Brief:

Ally Financial has named Michael G. Rhodes as its next CEO, effective April 29, the bank said Wednesday.
Rhodes, 58, assumed the CEO post at card issuer Discover this year, after being named to the role in December. Capital One announced in February it will acquire Discover in a $35.3 billion all-stock deal.
Rhodes submitted his resignation, effective April 1, to Discover’s board on Tuesday, according to a filing with the Securities and Exchange Commission. Discover board member J. Michael Shepherd will serve as interim CEO and president of the company and interim president of the bank, Discover said.

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Dive Insight:

At Detroit-based Ally, Rhodes will follow Jeffrey J. Brown, who left the CEO post in January after almost nine years as CEO. Doug Timmerman, Ally’s president of dealer financial services, has been interim CEO since then.

Rhodes, who will also join Ally’s board when he takes the CEO post in April, was “not expected to have a long-term role” at Discover, following the card company’s merger with Capital One, Riverwoods, Illinois-based Discover noted in its filing.

Michael G. Rhodes, incoming Ally CEO
Michael G. Rhodes
Retrieved from PR Newswire on March 27, 2024

As for Discover, Rhodes will serve as an adviser to Shepherd until April 12, and continue to receive his base salary through the remainder of his employment, Discover said in its filing.

Shepherd will remain a director of the company, but will leave the board’s risk oversight committee while serving as interim CEO and president, Discover said.

Prior to taking the top post at Discover, Rhodes spent about 12 years at TD, serving as the group head for Canadian personal banking since January 2022. He joined TD in 2011 to lead the North American credit card and merchant services business, and he has some 25 years of experience in financial services.

At Ally, Rhodes will receive an annual base salary of $1 million, according to the company’s SEC filing Wednesday. He also has a total target incentive opportunity for fiscal year 2024 of $10.5 million, with the amount earned payable after the year’s end in the form of a cash incentive (30%) and equity-based awards (70%), the filing said. Equity awards are 60% performance-based stock units and 40% time-based restricted stock units.