Financial Institutions, the parent of Five Star Bank, has promoted a senior executive to become its new president and chief executive officer, beginning next month.

The Warsaw-based company on Wednesday named Martin K. Birmingham Jr. to take the helm of the regional community bank, which operates more than 50 offices in Western and Central New York.

He will take over March 1 from John E. Benjamin, the company’s chairman, who has been acting as interim CEO for several months since the abrupt resignation of former longtime CEO Peter G. Humphrey over apparent disagreements with the board. Benjamin will remain chairman of the company.

“It’s an outstanding opportunity,” said Birmingham, 46. “I’ve been with the bank since March 2005, and we’ve accomplished so much the last eight years. At this point in time, we’ve put together a very solid performance over the last several years, and we’re off to a great start this year, and we have a huge opportunity to drive the performance of our bank in the markets that we serve.”

Humphrey remains on the board, and participated in the meeting on Wednesday, Birmingham said. “He’s one of my bosses, and I’m looking forward to continuing to work together,” he said.

The bank separately announced that its board of directors approved a 12.5 percent increase – 2 cents per share – in its quarterly cash dividend, to 18 cents per share. That’s the second straight quarter it has raised its dividend by two cents per share. It will also pay a 75 cent dividend on Series A preferred shares and $2.12 dividend on Series B-1 preferred shares. All dividends will be paid April 2 to shareholders of record on March 14.

“Balancing our return of capital to shareholders in the form of quarterly dividend payments, while retaining our ability to invest in our business to support growth initiatives both organically and acquisitively, continues to be a fundamental aspect of our business strategy,” Benjamin said.

The CEO announcement ends a long search that was launched in August after Humphrey’s resignation. Humphrey, who had been CEO since 1994, was the fourth generation of the family that had controlled and run the company and its subsidiary banks for more than 150 years, so his departure without warning came as a surprise to many.

The resignation also came as the bank was completing a pair of branch acquisitions from First Niagara Financial Group that gave it four former HSBC Bank USA branches and four former First Niagara branches in five counties. The deals closed last June and August, respectively, giving Financial Institutions another $376 million in deposits and $94 million in loans. Three branches were consolidated into an existing Five Star office in the Elmira area, and the bank came away with the No. 2 market share in Chemung County.

“It’s an extraordinary time for Five Star. We’re intently pursuing organic growth opportunities while remaining nimble to capitalize on marketplace changes,” Birmingham said in a statement. “By combining the substantial talents of our entire team with more innovative approaches and community-centered values, we’re poised for considerable success.”

He said the bank has been “working very extensively over the last six months to develop an operating plan that’s in alignment with driving shareholder value and our customer and employee experience.

“There’s been so much disruption in our marketplace,” he said. “We think there’s a marvelous opportunity for a locally headquartered bank to take advantage of it, and we fully intend to do that.”

Birmingham has served since last August as president and chief of community banking for the $2.7-billion-asset banking company. Previously, he was executive vice president and commercial banking executive, and also served as Northeast regional president for Five Star Bank. He briefly served as president and CEO of National Bank of Geneva before the parent company folded all of its bank subsidiaries into one and renamed it as Five Star.

The Pittsford resident previously worked as Rochester regional market president for Bank of America Corp. and its predecessor, FleetBoston Financial Group, from 2000 to 2005, and held corporate banking roles with FleetBoston’s Rochester division before Bank of America bought Fleet. The Rochester native started his career as a management trainee at Norstar Bank in Buffalo, and has worked the bank’s entire territory from Auburn to Buffalo and from Jamestown to Elmira, which he said gives him a critical knowledge of all the communities in the footprint.

“I’ve got a great knowledge of this company and our people. I think I’ve got a great command of our markets,” he said.

Birmingham received his bachelor’s degree in economics from St. Lawrence University and will graduate with an MBA from University of Rochester’s Simon Graduate School of Business in June.

“In selecting our next CEO, the board was focused on fulfilling our mission for the benefit of shareholders. Marty has distinguished himself as this type of forward-looking leader,” Benjamin said. “He has a multifaceted understanding of the community banking environment, and a true appreciation for the core customer and employee values that make us unique. With the intent of extending our track record of consistent growth, the board is enthusiastic about having Marty at the helm.”