S-Corporation Banks Reap Biggest ESOP Benefits

Small, closely-held banks face a lot of challenges in today’s highly consolidated and rapidly changing marketplace, but there’s one advantage they have over many other banks, including those that are publicly traded: When combined with an S-corporation organizational structure, Employee Stock Ownership Plans, or ESOPs, provide a level of retirement benefit to their participants that neither C-corporation ESOPs or any other qualified retirement plan can match. Of course, ESOPs are not exactly a new phenomenon. Although they gained legal status in 1974 as a qualified retirement plan under the Employee Retirement Income Security Act, the concept of providing employees with…

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Jack Milligan


Jack Milligan is editor-at-large of Bank Director magazine, a position to which he brings over 40 years of experience in financial journalism organizations. Mr. Milligan directs Bank Director’s editorial coverage and leads its director training efforts. He has a master’s degree in Journalism from The Ohio State University.