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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.          )

 

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CITY NATIONAL CORPORATION

NOTICE OF 2011 ANNUAL MEETING OF STOCKHOLDERS

TO OUR STOCKHOLDERS:

        We invite you to attend the 2011 Annual Meeting of Stockholders of City National Corporation to be held on April 20, 2011 at 4:30 p.m., PDT at City National Center, 400 N. Roxbury Drive, Beverly Hills, California to consider the following items of business:

1.

Election to the Board of Directors of four Class III directors for terms expiring in 2014 or until their respective successors have been elected and qualified;



2.

Ratification of the selection of KPMG LLP as City National Corporation's independent registered public accounting firm for the fiscal year ending December 31, 2011;



3.

Amendment of the 2008 Omnibus Plan;



4.

Amendment of the City National Corporation Amended and Restated 2010 Variable Bonus Plan (Variable Bonus Plan);



5.

An advisory vote on executive compensation;



6.

An advisory vote on the frequency of future advisory votes on executive compensation;



7.

A stockholder proposal regarding declassification of the Board of Directors;



8.

Any other business that may be properly brought before the meeting or any postponement or adjournment of the meeting.

        Stockholders of record at the close of business on February 22, 2011 are entitled to notice of, and to vote at, the annual meeting or any postponement or adjournment of the meeting.

        YOUR VOTE IS IMPORTANT. EVEN IF YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, WE ENCOURAGE YOU TO CAST YOUR VOTE ON THE INTERNET, BY TELEPHONE, OR IF YOU PREFER, BY COMPLETING AND RETURNING YOUR PROXY CARD IN THE ENCLOSED RETURN ENVELOPE. SPECIFIC INSTRUCTIONS FOR VOTING ON THE INTERNET OR BY TELEPHONE ARE ATTACHED TO THE PROXY CARD.

        Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be held on April 20, 2011: This Notice of Annual Meeting and Proxy Statement are also available at www.cnb.com/ir/ir-kit.asp.

        We appreciate your continuing support and look forward to seeing you at City National Corporation's annual meeting.

Sincerely,

Los Angeles, California
March 15, 2011

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CITY NATIONAL CORPORATION
555 South Flower Street
Los Angeles, California 90071
(213) 673-7700

ANNUAL MEETING OF STOCKHOLDERS ON APRIL 20, 2011

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PROXY STATEMENT

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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING,
PROXY MATERIALS AND VOTING

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Q.    Who can vote at the annual meeting?

A.

Stockholders of record on the Record Date, which was Tuesday, February 22, 2011, may vote at the annual meeting. At the close of business on the Record Date, there were 53,137,433 shares of the Corporation's common stock outstanding, each of which is entitled to one vote with respect to each matter to be voted on at the annual meeting.

Q.    How many votes are needed to hold the annual meeting?

A.

The presence at the meeting, in person or by proxy, of the holders of a majority of the aggregate voting power of the common stock outstanding on the Record Date will constitute a quorum, permitting us to hold the meeting and conduct business. Proxies received but marked as abstentions and broker non-votes will be included in the calculation of the number of votes considered to be present at the meeting for purposes of determining a quorum.

Q.    What do I have to do to vote?

A.

You may vote by granting a proxy, or for shares held in "street name" through a broker or other nominee, by submitting voting instructions to your broker or other nominee. If your shares are held in street name, you will receive instructions that you must follow to have your shares voted. See below for more information on voting your shares if held in street name.

If you hold your shares as the stockholder of record, follow the instructions on each proxy card you receive to vote either on the Internet, by telephone, OR by mailing your signed proxy card in the enclosed return envelope. Your shares will be voted as you direct. If you do not tell us how you want to vote your shares, and we are permitted to vote on your behalf, your shares will be voted FOR each of the Board of Directors' nominees for election as director, FOR ratification of KPMG LLP (KPMG) as our independent registered public accounting firm, FOR amendment of the 2008 Omnibus Plan, FOR amendment of the Variable Bonus Plan, FOR approval of the compensation of our named executive officers, FOR approval of an annual advisory vote on executive compensation, and AGAINST the stockholder proposal.

If you are the record holder of the shares, you may change or revoke your vote at any time before it is counted at the annual meeting by (i) notifying our Secretary at the address shown above; (ii) attending the annual meeting and voting in person; or (iii) submitting a later dated proxy card. Unless you decide to attend the meeting and vote your shares in person after you have submitted voting instructions to the proxies, we recommend that you revoke or amend your prior instructions in the same way you initially gave them—that is, by telephone, Internet or in writing. This will help to ensure that your shares are voted the way you have finally determined you wish them to be voted. If you revoke by mail, or by using the telephone or Internet voting options, we must receive the revocation several hours before the annual meeting begins. If you choose to revoke by mail, please make sure you have provided enough time for the replacement proxy to reach us. Once the annual meeting begins you can only revoke your proxy in person. Once the polls close at the annual meeting, the right to revoke ends. If you have not properly revoked your proxy, we will vote your shares in accordance with your most recent valid proxy.

In addition, if other matters are properly presented for voting at the annual meeting, the proxy holders are also authorized to vote on such matters as they shall determine in their sole discretion. As of the date of this proxy statement, we have not received notice of any other matters that may be properly presented for voting at the annual meeting.

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Q.    What do I have to do to vote my shares if they are held in the name of my broker?

A.

If your shares are held by your broker or other nominee, you must vote your shares through your broker or other nominee. You should receive a form from your broker or other nominee asking how you want to vote your shares. Follow the instructions on that form to give voting instructions to your broker or other nominee, including instructions for voting by telephone or on the Internet. You may change your vote by submitting new voting instructions to your broker or other nominee.

If you do not give instructions to your broker or other nominee, the broker or other nominee will determine if it has the discretionary authority to vote on the particular matter. Under the NYSE's rules, brokers and other nominees have the discretion to vote on routine matters such as Proposal 2, but do not have discretion to vote on non-routine matters such as Proposals 1 and 3-7. Therefore, if you do not provide voting instructions to your broker or other nominee, your broker or other nominee may only vote your shares on Proposal 2 and any other routine matters properly presented for a vote at the Annual Meeting. A broker non-vote occurs when a broker has not received voting instructions from the customer and the broker cannot vote the shares because the matter is not considered a routine matter under NYSE rules. Broker non-votes will be counted for purposes of calculating whether a quorum is present at the Annual Meeting, but will not be counted for purposes of determining the number of votes present in person or represented by proxy and entitled to vote with respect to a particular proposal.

Q.    How do I vote my shares that I hold in the City National Corporation Profit Sharing Plan?

A.

If you hold shares in your account under the City National Corporation Profit Sharing Plan (Profit Sharing Plan), you will receive directions on how to submit your voting instructions as part of your proxy mailing. For any shares you hold in the Profit Sharing Plan, if your voting instructions are not received by Friday, April 15, 2011, your shares will be voted in proportion to the way the other Profit Sharing Plan participants voted their shares. If your shares are held in our Profit Sharing Plan, you may change your vote by following the voting instructions as part of your proxy mailing, except that any changes to your voting instructions must be provided by Friday, April 15, 2011. You will not be able to change your vote after this deadline.

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Q.    What is the vote required for each proposal?

With respect to Proposal 1, you may vote For all nominees, Withhold your vote as to all nominees, or vote For all nominees except those specific nominees from who you Withhold your vote. The four nominees receiving the most For votes will be elected. With respect to Proposals 2, 3, 4, 5, and 7, you may vote For, Against or Abstain. If you Abstain from voting on any of these Proposals, the abstention will have the same effect as an Against vote. With respect to Proposal 3, under NYSE rules, the total votes cast on the proposal must represent over 50% of all shares entitled to vote on the proposal. With respect to Proposal 6, you may vote For either Every Year, Every Two Years, Every Three Years or Abstain. It is possible that no single choice in Proposal 6 will receive a majority vote. Proposals 5 and 6 are advisory votes and are non-binding on our Board.

Q.    How may I obtain a separate set of proxy materials or request a single set for my household? What should I do if I receive more than one set of voting materials?

A.

If you share an address with another stockholder, you may receive only one set of proxy materials (including our 2010 Summary Annual Report, Form 10-K for the year ended December 31, 2010, and proxy statement) unless you have provided contrary instructions. If you wish to receive a separate set of proxy materials now or in the future, please request the additional copies by e-mail to investor_relations@cnb.com, by facsimile to (213) 673-7622 or by calling (213) 673-7615. Similarly, if you share an address with another stockholder and have received multiple copies of our proxy materials, you may contact us in the same manner or write us at the address set forth below in the last question to request delivery of a single copy of these materials.

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Q.    Why may I receive multiple voting instruction forms and/or proxy cards?

A.

If you hold your shares in more than one brokerage account, you may receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a stockholder of record and your shares are registered in more than one name, you will receive more than one proxy card. If you are an employee of City National Bank, you will receive a voting instruction card for all the shares you hold in the Profit Sharing Plan and you will receive a proxy card for any restricted shares of our common stock you hold. In each case, please follow the voting instructions on the card or form you receive to vote your shares on the Internet, by telephone or by completing and returning each proxy card and voting instruction form that you receive.

Q.    Who is paying for this solicitation?

A.

The Corporation will pay the cost of this proxy solicitation. In addition to soliciting proxies by mail, proxies may be solicited personally or by telephone, facsimile, the Internet or other means by certain directors, officers and employees who will receive no additional compensation for their services. We have engaged Innisfree M&A Incorporated, 501 Madison Avenue, 20^th Floor, New York, NY 10022, to assist in the solicitation of proxies at an estimated fee of $20,000 plus disbursements. We will pay brokers and others who hold our common stock in their name for the expenses of forwarding the proxy materials to the beneficial owners of the common stock.

Q.    What are the guidelines for attending the meeting?

A.

Any stockholder entitled to vote at the annual meeting may attend the annual meeting. If you plan to attend the annual meeting, please bring the admission ticket attached to your proxy card and photo identification. If your shares are held in the name of a broker or other nominee, please bring with you a letter (and a legal proxy if you wish to vote your shares) from the broker or nominee confirming your ownership as of the record date, which is February 22, 2011. Failure to bring such a letter may prevent you from attending the meeting.

Q.    How do I get more information about the Corporation?

A.

With this proxy statement, we are also sending you our 2010 Summary Annual Report and our Form 10-K for the year ended December 31, 2010, which includes our financial statements. At your request, we will send you additional copies of these reports without charge, and we also make these items available on our website at www.cnb.com/ir/ir-kit.asp. The Form 10-K includes a list of exhibits filed with the Securities and Exchange Commission (SEC) but not the exhibits. If you wish to receive copies of the exhibits, you may request them from us by mail, facsimile or e-mail at the following contact information. We will send the exhibits to you upon payment of our expenses for doing so.

Investor Relations
City National Corporation
555 S. Flower Street, 9^th Floor
Los Angeles, California 90071
Facsimile: (213) 673-7622
E-mail: investor_relations@cnb.com

Our website is available for information purposes only and should not be relied upon for investment purposes, nor is it incorporated by reference into this proxy statement. The other materials available in the online investor kit include our annual reports on Form 10-K and quarterly reports on Form 10-Q. The SEC also maintains a website at www.sec.gov that contains reports, proxy statements and other information regarding SEC registrants, including City National Corporation.

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PROPOSAL 1: ELECTION OF DIRECTORS

        Our Board of Directors is divided into three classes, with the term of office of one class expiring each year, meaning that our stockholders elect approximately one-third of our Directors at each annual meeting. Currently, our Board of Directors has 12 members. The term of office of our Class III directors will expire at this year's annual meeting. On the nomination of our Board, Richard L. Bloch, Bram Goldsmith, Ashok Israni and Kenneth Ziffren, will each stand for re-election as Class III directors at this year's annual meeting for a three year term expiring at our annual meeting in 2014 or until their successors have been elected and qualified.

        Unless otherwise directed, the persons named as proxies in the enclosed proxy card intend to vote "FOR" the election of the nominees. If one or more of the nominees unexpectedly becomes unavailable to serve as a director, the proxies may be voted for one or more substitute nominees selected by our Board of Directors, or the authorized number of directors may be reduced. If the authorized number of directors is reduced for any reason, the proxies will be voted for the election of the remaining nominees named in this proxy statement. To the best of our knowledge, all nominees are and will be available to serve as directors.

        Set forth below is information as of February 1, 2011 about each nominee for election as a Class III director, and each of the Class I and Class II directors whose terms have not yet expired and who will continue to serve as directors after this year's annual meeting. Each of the current directors is also a director of City National Bank (Bank), a wholly owned subsidiary of City National Corporation (collectively, Corporation and Bank are referred to in this Proxy Statement as the Company). The biographies of each of the nominees and continuing directors below includes information about the person's age, principal occupation, business experience, director positions held currently or at any time during the last five years, information regarding involvement in certain legal or administrative proceedings, if applicable, and the experiences, qualifications, attributes or skills that led the Compensation, Nominating & Governance Committee (CN&G Committee or Compensation Committee) of the Company and the Board to determine that the person should serve as a director. When considering whether directors and nominees have the experience, qualifications, attributes and skills to enable the Board of Directors to satisfy its oversight responsibilities effectively, the CN&G Committee and the Board of Directors focus primarily on the information in each of the Directors' individual biographies, including notably their reputation for integrity, honesty and adherence to high ethical standards. The CN&G Committee has determined that each has demonstrated business acumen and an ability to exercise sound judgment, as well as a commitment to service to our Company and our Board. Finally, each of the directors named below support and enhance our commitment to serve entrepreneurs, professionals, and their businesses and families with complete financial solutions.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE ELECTION OF
RICHARD L. BLOCH, BRAM GOLDSMITH, ASHOK ISRANI AND KENNETH ZIFFREN.

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Nominees for election as Class III Directors with Terms Expiring in 2014:

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Class I Directors (Terms Expire at 2012 Annual Meeting):

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Class II Directors (Terms Expire at 2013 Annual Meeting):

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PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM

        Our Board of Directors has ratified the decision of the Audit & Risk Committee to appoint KPMG to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2011. Although we are not required to do so, it has been our practice to seek stockholder ratification of this appointment as a matter of good corporate governance. KPMG has audited our financial statements since 1993. Representatives of KPMG will be present at our annual meeting to make a statement, if they desire to do so, and to respond to appropriate questions.

        If the stockholders fail to ratify the selection, the Board of Directors may reconsider whether or not to retain KPMG and reserves the discretion to retain KPMG as our independent registered public accounting firm. Even if the selection is ratified, the Board of Directors in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if the Board of Directors determines that such change would be in the best interests of the Corporation and its stockholders.

        We incurred the following fees in 2010 and 2009 for professional services provided by KPMG:

        The Audit & Risk Committee's policy is to pre-approve all audit and non-audit services to be provided by our independent registered public accounting firm. Pre-approvals are generally provided for up to one year, are detailed as to the particular service or category of services, and are subject to a specific budget. The Audit & Risk Committee has delegated pre-approval authority to its Chairman when expedited approval of services is necessary. All of the services provided by KPMG in 2010 and 2009 were pre-approved by the Committee.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR"
THE RATIFICATION OF THE SELECTION OF KPMG AS OUR
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.

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PROPOSAL 3: AMENDMENT OF THE 2008 OMNIBUS PLAN

        We are asking stockholders to approve an amendment to the Corporation's 2008 Omnibus Plan (2008 Plan) to reserve 1,000,000 additional shares of common stock of the Corporation (Shares) for issuance under the 2008 Plan (New Shares) in order to provide a sufficient number of Shares to continue the equity compensation component of our compensation program. There were 1,543,926 Shares (Existing Shares) available for issuance under the 2008 Plan as of December 31, 2010. Upon approval by stockholders of the amendment to the 2008 Plan, the New Shares will be available for grant under the 2008 Plan in addition to the Existing Shares.

        The objective of the 2008 Plan is to promote the success of the Corporation by providing an additional means to attract, motivate, retain and reward employees of the Corporation and its subsidiaries. The Board of Directors has found equity awards to be an effective means of compensating employees in a manner that aligns their interests with the interests of stockholders. Equity awards motivate employees to create long-term stockholder value and to build long-term capital to share in the success of the Corporation. In order to assure that we have sufficient Shares available for grants of equity awards under the 2008 Plan to achieve this important objective of our compensation strategy, the Board of Directors recommends adoption of the amendment to the 2008 Plan. On April 23, 2008, the stockholders approved the 2008 Plan, as subsequently amended and approved by the stockholders April 21, 2010. The current amendment to the 2008 Plan was approved by the Board and the CN&G Committee on February 16, 2011, subject to stockholder approval. In the event stockholder approval of the amendment is not obtained, the Corporation will continue to grant awards available from Existing Shares pursuant to the 2008 Plan, and subject to applicable laws.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR"
THE PROPOSAL TO AMEND THE 2008 OMNIBUS PLAN.

Description of the 2008 Omnibus Plan

        The summary below is subject to, and qualified in its entirety by, the full text of the 2008 Plan, as amended and restated, a copy of which is attached as Appendix A. The only substantive amendment to the 2008 Plan is to reserve the New Shares for issuance under the 2008 Plan. The material features of the 2008 Plan are as follows:

•

The maximum number of shares available for Awards is reduced by 1 share for each Stock Option (Option) issued and 2 shares (3.3 shares for Awards made prior to April 21, 2010) for every share of Restricted Stock (RS), Restricted Stock Units (RSUs), Performance Shares (PS) or Performance Share Units (PSUs) issued;



•

Grants of all types of Awards, other than Incentive Stock Options (ISOs), but including deferred units, available under the 2008 Plan may be made to Non-Employee Directors; however, the Company has not had a practice of issuing Awards to non-employee directors from the 2008 Plan or its predecessor plans since 2005;



•

Restrictions imposed on RS Awards may not lapse over a period of less than three (3) years following the date of the Award; and



•

Grants of RSUs denominated in Shares and payable in Shares, cash or a combination thereof and of Performance Units (PCUs) valued by reference to a designated amount of cash or property other than Shares and payable as the CN&G Committee determines, including in Shares, cash or a combination thereof based upon achievement of specified performance goals are authorized.

        Any unexercised, unvested or undistributed portion of Awards under the Existing Plan and all previous plans of the Corporation which are returned to the Corporation will be available for Awards as

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additional Shares under the 2008 Plan. Shares subject to reissue will be credited to the 2008 Plan using the same reduction factor as was used at the time of the Award.

        The following table summarizes information, as of December 31, 2010, relating to equity compensation plans of the Company pursuant to which equity securities of the Company are authorized for issuance.

Administration and Eligibility

        The 2008 Plan is administered by the CN&G Committee. Except for any amendment requiring stockholder approval under applicable law or the NYSE listing standards, the Board of Directors may amend, suspend or discontinue the 2008 Plan in its discretion. Termination of the 2008 Plan will not affect any Awards then outstanding.

        Officers at the level of Vice President or above and other officers who provide substantial services to the Corporation and non-employee directors are eligible to participate as well as other persons who perform or agree to perform substantial services for the Corporation of a nature similar to those performed by key employees, including significant agents and consultants, except that ISOs may only be granted to employees. The CN&G Committee determines which employees will receive Awards and the terms of the Awards. As of January 1, 2011, approximately 420 officers and 9 non-employee directors would have been eligible for selection to participate in the 2008 Plan. The Company does not currently have a practice of issuing Awards from the 2008 Plan to non-employee directors. No determination has been made as to the number of agents, consultants and other persons who are neither employees nor directors, but who might have been, or may be, eligible to participate in the 2008 Plan.

Kinds of Awards

        The following types of Awards are authorized by the 2008 Plan:

        Stock Options:    Stock options (Options), either ISOs or Nonqualified Stock Options (NSOs), may be granted to eligible employees. ISOs are subject to certain limitations not applicable to NSOs. NSOs may be granted to non-employee directors. The exercise price of all Options may not be less than the fair market

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value of the Corporation's common stock on the date of grant (for an ISO granted to any eligible employee owning more than 10% of the Corporation's stock the exercise price may not be less than 110% of the fair market value). The aggregate fair market value (determined at the date of grant) of the stock subject to all ISOs held by an optionee that vest in any single calendar year cannot exceed $100,000.

        Stock Appreciation Rights:    Stock Appreciation Rights (SARs) may be granted to eligible employees or non-employee directors, either in tandem with Options or freestanding. Upon exercise, the holder receives a specified amount in cash, Shares, or a combination of the two. The exercise price of SARs may not be less than the fair market value of a Share on the date of grant. Each SAR entitles the holder to receive the excess of the fair market value of a Share on the exercise date over the fair market value of such Share on the date the SAR was awarded, subject to any maximum determined by the CN&G Committee. If SARs are granted in tandem with Options, they may be exercised only during the time and to the extent that the related Options may be exercised, and the number of Options held by the optionee is decreased by the number of SARs exercised by the optionee.

        The CN&G Committee may not reduce the exercise price of any Option or SAR granted under the 2008 Plan.

        Restricted Stock Awards:    RS Awards may be granted to eligible employees or non-employee directors. The CN&G Committee shall determine the consideration to be paid and the period over which the restrictions shall lapse. Except as otherwise provided in the applicable award agreement, the restrictions may not lapse with respect to any RS Award over a period of less than three years following the date of the Award, and recipients of a RS Award shall be entitled to cash dividend and voting rights for all RS issued even though not vested, provided that such rights shall terminate immediately as to any RS which ceases to be eligible for vesting. An award agreement may provide that cash dividends shall be automatically deferred and reinvested in additional RS, held subject to the vesting of the underlying RS. RSUs may be granted to any eligible employee or non-employee director which may be payable in Shares, cash or a combination thereof.

        Performance Share Awards:    PS Awards may be granted based on criteria determined by the CN&G Committee which, if achieved, result in the Corporation's issuing to the employee or non-employee director an amount in Shares, cash or a combination equal to the fair market value of the number of Shares specified in the Award Agreement, subject to any maximum determined by the Committee. The financial criteria include those outlined in Section 1.6 of the 2008 Plan attached as Appendix A, which criteria may be applied to any Award. The Committee may provide for full or partial credit for the satisfaction of criteria before the end of the period of time specified or the attainment of the specified goal, in the event of the employee's death, retirement or disability or under such circumstances as the Committee may determine, subject to Section 162(m) of the Internal Revenue Code (Code). PSUs may be granted to any eligible employee or non-employee director.

        Performance Unit Awards:    PCUs may be granted to eligible employees valued by reference to a designated amount of cash or property other than Shares, which value may be paid by delivery of such property as the CN&G Committee shall determine, including, without limitation, Shares, cash or a combination thereof, upon achievement of such performance goals during the performance period as the CN&G Committee shall establish at the time of such grant or thereafter.

Maximum Shares

        The maximum number of shares for which Options and freestanding SARs may be granted to a single employee in any three calendar year period may not exceed 2,400,000 Options or SARs, or in the case of RS, RSUs, PS, or PSUs, their equivalent at the ratio of 1:3.3 for Awards made prior to April 21, 2010 and 1:2 for Awards made subsequent to April 21, 2010. The limitations are subject to adjustment in the event of changes in the capitalization or corporate structure of the Corporation. Upon termination, cancellation,

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forfeiture or expiration of any unexercised Award under the Existing Plan, the number of shares with respect to which Awards may be granted under the 2008 Plan will be increased by the number of shares to which such unexercised Award pertained. In addition, the maximum value of the property, including cash or shares, that may be paid or distributed to any eligible employee or non-employee director pursuant to a grant of PCUs with respect to any three calendar year period is $15 million dollars.

Terms of Awards

        The CN&G Committee determines the vesting (subject to the limitations described under Kinds of Awards—Restricted Stock) and, where applicable, the expiration date of Awards, but Awards that provide for the right to acquire stock may not remain outstanding more than 10 years after the grant date, and any ISO Award granted to any eligible employee owning more than 10% of the Corporation's stock must not be for a term longer than five years. Unless the Committee determines otherwise, Awards do not vest or become exercisable until six months after the date of grant.

        Awards may generally be exercised only by the person to whom they were granted, and, unless otherwise permitted by the Corporation, cannot be sold, pledged, assigned or otherwise transferred, except to the Corporation, by a designation of beneficiary or according to the grantee's will or the laws of descent and distribution or according to the terms of certain court orders.

        The CN&G Committee will determine the effect of the termination of employment on Awards, depending on the nature of the termination, including changing the exercise period or the number of shares for which an Award is vested or exercisable at the time of termination or thereafter.

Adjustments and Extraordinary Events

        In the event of an extraordinary corporate transaction, the Committee shall proportionately adjust the 2008 Plan and outstanding Awards as to the number or kind of shares to which they relate, the price payable upon the exercise of Awards or the applicable performance standards or criteria. If a Change in Control Event, as defined in the 2008 Plan, takes place, then all outstanding Options and SARs become exercisable, all RS and RSU restrictions lapse and all PS, PSUs and PCUs shall become vested, unless the CN&G Committee determines otherwise, in which event the CN&G Committee will make provision for continuation and, if required, assumption of the 2008 Plan and outstanding Awards or for the substitution of new Awards therefor.

Federal Income Tax Consequences

        Stock Options:    Grants of NSOs and ISOs do not create taxable income at the time of the grant. Optionees will realize ordinary income at the time of exercise of a NSO equal to the difference between the exercise price and the fair market value of the stock on the date of exercise. Optionees will not realize income at the time of a qualified exercise of an ISO. If the shares of stock acquired in the exercise of an ISO are retained for a period of at least two years after the Option is granted and one year after the Option is exercised, any gain upon the subsequent sale of the stock will be taxed as a long-term capital gain. An optionee who disposes of shares acquired by exercise of an ISO prior to the expiration of two years after the Option is granted or one year after the Option is exercised will realize ordinary income as of the date of disposition up to the difference between the exercise price and fair market value of the stock on the date of exercise. To the extent ordinary income is recognized by the optionee, the Corporation may deduct a like amount as compensation.

        Restricted Stock:    Grants of RS will not be subject to taxation until the restrictions lapse. At that time, the employee's ordinary income will be the difference between the fair market value at the time the restrictions lapse and the amount employees pay, if anything, for the Shares. Employees may be entitled to make an election within thirty (30) days of the RS Award which will cause tax to be due on the value of the

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Shares at the time of the grant. Taxable income on RSUs will be deferred until the time of actual distribution at termination of service.

        A discussion of the tax consequences of other types of Awards under the 2008 Plan is beyond the scope of this disclosure.

        Section 162(m) Limits:    Section 162(m) of the Code (Section 162(m)) and the regulations thereunder can result in compensation that exceeds $1,000,000 in any year paid to the principal executive officer or any of the three other most highly compensated executive officers, other than the principal financial officer, being non-deductible by the Corporation unless the compensation is exempt. The rules contain an exemption for performance-based compensation plans that includes the requirement, among other things, that the material terms of the plan be approved by stockholders. Although the Corporation believes that Options and SARs granted under the 2008 Plan should be exempt under the rules, and consequently deductible to the Corporation as discussed above, RS and RSUs may not be exempt if the aggregate compensation of the executive officer would exceed such limit. PS, PSUs and PCUs are intended to be classified as performance-based compensation which is exempt from the Section 162(m) limitation. In the event of a further change in the applicable law or rules, the continued deductibility of Options, SARs and PS, PSUs and PCUs cannot be assured.

        Section 409A:    Except to the extent specifically provided otherwise by the Committee, it is intended that the 2008 Plan and Awards issued under the 2008 Plan will comply with Section 409A of the Code (and any Treasury Regulations and related guidance) to the extent the Awards are subject thereto, and the 2008 Plan and such Awards shall be interpreted on a basis consistent with such intent. The 2008 Plan and any Award Agreements issued under the 2008 Plan may be amended in any respect deemed by the Committee to be necessary in order to seek to preserve compliance with Section 409A of the Code.

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PROPOSAL 4: AMENDMENT OF THE VARIABLE BONUS PLAN

        We are asking shareholders to approve an amendment to the Variable Bonus Plan to increase the maximum dollar amount that may be awarded under the Variable Bonus Plan for any plan year to any participant from $3 million to $5 million.

        The purpose of the Variable Bonus Plan is to promote the success of the Corporation by providing incentives consisting of cash awards based upon the Corporation's achievement of specific goals, and to attract, retain and reward officers of the Corporation. The Variable Bonus Plan is designed to take into account Section 162(m) (see discussion in Proposal 3). Certain types of compensation, including performance-based compensation, are generally excluded from the Section 162(m) deduction limit. In an effort to ensure that certain compensation payable under the Variable Bonus Plan continues to qualify as performance-based compensation and to preserve the deductibility of most compensation paid to executive officers, the amendment to the plan is being submitted to stockholders for approval at the annual meeting.

        On April 21, 2010, the shareholders approved the Variable Bonus Plan. The Board approved amendments to the Variable Bonus Plan as of February 25, 2011, subject to shareholder approval. In the event shareholder approval is not obtained, the Variable Bonus Plan will remain in effect without the proposed amendments and that portion of any award made to a participant under the Variable Bonus Plan for any plan year in excess of $3 million may be subject to Section 162(m) limitations.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE PROPOSAL
TO AMEND THE VARIABLE BONUS PLAN.

Description of the Variable Bonus Plan

        The summary below is subject to, and qualified in its entirety by, the full text of the Variable Bonus Plan, as amended and restated, a copy of which is attached hereto as Appendix B. The material features of the Variable Bonus Plan are as follows:

Administration

        The Variable Bonus Plan is administered by the CN&G Committee. To the extent required to comply with Section 162(m), each Committee member qualifies as an "outside director." Among other things, the Committee has the authority to select the officers of the Corporation to whom awards may be granted and to determine the terms and conditions of any such awards. The Board of Directors has the absolute discretion to modify or amend the Variable Bonus Plan in whole or in part, or suspend or terminate the Variable Bonus Plan in its entirety. However, the effect of any such modification, amendment, suspension or termination during a Plan Year (as defined in the Variable Bonus Plan) will be weighed against the requirements of Section 162(m).

Eligibility

        The chief executive officer and all other officers of the Corporation, and its subsidiaries, are eligible to be selected by the CN&G Committee to be granted awards under the Variable Bonus Plan. Prior to, or within 90 days after, the commencement of each Plan Year, the CN&G Committee shall designate the individuals eligible to participate in the Variable Bonus Plan. They may also designate individuals to participate in the Variable Bonus Plan after the 90th day of the Plan Year, with the respective period for such individuals consisting of less than a full Plan Year; however, any awards earned by such individuals will be prorated.

        It cannot be determined at this time what benefits or amounts, if any, will be allocated to or received by any persons or group of persons under the Variable Bonus Plan if adopted. Such determinations as to allocations and receipts or pay out are at the discretion of the CN&G Committee and dependent upon future performance. However, the annual non-equity incentive plan compensation paid to the Named

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Executive Officers for 2010 and prior years are set forth in the non-equity incentive plan compensation column of the Summary Compensation table. See EXECUTIVE COMPENSATION, below.

Description of Awards

        On or before the 90th day of each Plan Year, the CN&G Committee establishes the Corporate Financial Criteria which will apply to awards and the Performance Goals to be met by participants to earn awards. A participant's salary for purposes of determining an award is the salary as of the date of the CN&G Committee meeting at which the bonus is approved. The Performance Goals are required to be specific, objective goals, the outcome of which are substantially uncertain at the time established, for each of the Corporate Financial Criteria. The Corporate Financial Criteria may include the criteria described in Section 6 of the Variable Bonus Plan; although, the CN&G Committee retains the discretion to determine whether an award will be paid under any of the Corporate Financial Criteria (except in the case of a participant who has entered into an employment contract with the Corporation, in which case the CN&G Committee does not have discretion to award a bonus less than the minimum amount required by such agreement).

        The level of achievement of the Performance Goals at the end of the Plan Year will determine the amount of each participant's award. To the extent that minimum Performance Goals achievement levels are met or surpassed, and upon certification by the CN&G Committee in writing that the Performance Goals and other material terms of the award were satisfied, payment of an award will be made to the participant for that Plan Year. Awards, which have not been deferred, are required to be paid not later than the fifteenth day of the third month following the end of the plan year. Subject to the requirements of Section 162(m) and to the requirement of any employment agreements between the Corporation and a participant, the payment of all awards are subject to reduction by the CN&G Committee.

        The only substantive amendment of the Variable Bonus Plan is to increase the maximum amount payable under the Variable Bonus Plan to a participant during any plan year from $3,000,000 to $5,000,000.

COMPANY CORPORATE GOVERNANCE

        We are committed to maintaining the highest standards of business conduct and corporate governance. We regularly review our governance practices and update them, as appropriate, based upon applicable state law, NYSE rules and listing standards, SEC regulations, and best practices recommended by recognized governance authorities. Our corporate governance program includes robust risk management and compliance policies, practices and programs.

        Our framework for corporate governance includes the following:

        Corporate Governance Guidelines:    Our Corporate Governance Guidelines (Guidelines) establish significant corporate governance policies and practices for our Company.

        Codes of Conduct:    Our Codes of Conduct include our Code of Ethics for Senior Financial Officers and our Principles of Business Conduct and Ethics for our directors, officers and colleagues (Codes).

        Board Committee Charters:    Each standing committee of our Board operates pursuant to a written charter (Charter) which states each committee's functions and duties. Each committee's Charter is reviewed, revised, as appropriate, and reaffirmed annually. Further information regarding our Board committees is set forth below.

        Organizational Documents:    Our Restated Certificate of Incorporation and Bylaws set forth basic rights and duties for our Company's corporate governance.

        Please visit our website at www.cnb.com/ir/governance (CNC Corporate Governance Web Page) to view our Guidelines, Codes and Charters as well as additional information about our Board, committees

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and corporate governance. We will post on this website any amendments to the Guidelines, Codes or Charters, and any waivers of the Codes for directors and executive officers. There were no waivers in 2010.

        Director Independence:    Our Board of Directors has established criteria to determine the independence of non-employee members of the Board (Independence Standards). The Independence Standards are included as part of our Guidelines and are attached to this proxy statement as Appendix C. Our Independence Standards are structured to provide a framework for Board decisions that is free of relationships that may impair, or appear to impair, our Board's ability to make independent collective judgments, and to ensure that all permitted transactions between the Company and a director or his/her immediate family or their respective primary business affiliations will be on arms-length market terms. The Independence Standards seek to accomplish these goals by utilizing a combination of economic tests and confirmation that relationships are maintained on substantially the same terms as those prevailing at the time for comparable transactions with non-affiliated persons.

        At its meeting on February 16, 2011, our CN&G Committee, the Audit & Risk Committee, and Board reviewed the relationship of the Company with each of our non-employee directors and determined that each of the following persons is an independent director as defined by the NYSE listing standards and our Independence Standards: Richard L. Bloch, Kenneth L. Coleman, Alison Davis, Ashok Israni, Ronald L. Olson, Bruce Rosenblum, Peter M. Thomas, Robert H. Tuttle and Kenneth Ziffren. In early 2010, the Board also determined that Michael Meyer, who retired effective April 21, 2010, was also an independent director for these purposes.

        In making its independence determinations, the CN&G Committee, the Audit & Risk Committee, and the Board considered the following ordinary course, non-preferential relationships in 2010 between us and our subsidiaries and our independent directors, director nominees, their immediate family members, and any entity of which the independent director (or their immediate family member) is a principal, executive officer, or greater than 5% equity holder:

•

The Bank and other subsidiaries had ordinary course banking, financial services, and wealth management relationships with certain members of the Board, some of their respective immediate family members and some of the entities affiliated with such directors and their immediate family members.



•

The Corporation or its subsidiaries received legal services in the ordinary course from the law firm of Munger, Tolles & Olson LLP in which Ronald L. Olson, a director of the Corporation, is a Partner. The amounts paid for the legal services are below the thresholds in our Independence Standards and the NYSE listing standards.



•

The Bank entered into an ordinary course commercial transaction for data storage services with Switch Communications Group, LLC (Switch) negotiated on arms-length, market terms. Peter Thomas, a director of the Corporation, owns, either directly or indirectly, an approximate 8% equity interest as a passive investor in Switch without any active oversight or management control. The payments to be made to Switch for the services are based on competitive rates made on substantially the same terms as those prevailing at the time for comparable transactions with non-affiliated entities. The amounts paid in 2010 (and amounts that are expected to be paid in 2011) to Switch are below the thresholds in our Independence Standards and the NYSE listing standards.

        The CN&G Committee, Audit & Risk Committee and the Board have each determined that, based on the information available, none of these relationships was material.

        Board Meetings and Committees; Leadership Structure; Annual Meeting Attendance:    Directors are expected to attend our annual meeting of stockholders, regular and special meetings of the Board and meetings of the committees on which they serve. In 2010, there were 15 meetings of the Board, and each current director attended at least 75% of the total number of meetings of the Board and Board committees

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on which he or she then served. In addition, all directors, except one, serving on the Board at the time of the 2010 annual meeting of stockholders attended our 2010 annual meeting.

        We separate the roles of CEO and Chairman with Bram Goldsmith serving as the Chairman of the Board and Russell Goldsmith serving as the CEO. Bram Goldsmith, as our Chairman, provides guidance, continuing strong leadership, energy and passion to the Board from his perspective as one of the earliest clients of the Bank, his experience as a successful real estate developer, and years of experience as an executive of the Company. Russell Goldsmith, as our CEO, is responsible for setting the strategic direction for the Company and the day to day leadership and performance of the Company. Since our Chairman is not "independent," the Chairman of our Special Matters Committee, Kenneth Ziffren, serves as the Lead Outside Director, and accordingly leads all Executive Sessions of the independent directors. In 2010, our independent directors had three executive sessions without management, and two with our CEO.

        Committee membership in 2010, and the number of meetings of the full board and each standing committee in 2010, are shown in the table below. As it deems appropriate, our Board may form new committees or disband committees, other than the Audit & Risk Committee and the CN&G Committee. The chair of each committee determines the frequency and agenda of committee meetings. (Members are designated with a "ü".)

Board of Directors Role in Risk Oversight:

        The Board is actively involved in oversight of risks that could affect the Company. This oversight is conducted primarily through committees of the Board, as disclosed in the charters of the each of the committees.

        The Audit & Risk Committee monitors the Company's overall risk profile, as established by the Board of Directors, including all credit, market, liquidity, operational and regulatory risk management activities, and reviews and approves the activities of key management governance committees that regularly evaluate risks and internal controls for the Company. These management committees include the Asset Liability Management Committee, the Credit Policy Committee, the Senior Operations Risk Committee and the Risk Council. The Risk Council reviews the development, implementation and maintenance of risk management processes from a Company-wide perspective, and assesses the adequacy and effectiveness of

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the Company's risk management policies and the Enterprise Risk Management Program. Other management committees, with representatives from the Company's various lines of business and affiliates, address and monitor specific risk types and report periodically to the key management committees. The Senior Risk Management Officer and the Internal Audit and Credit Risk Review units provide the Audit & Risk Committee with independent assessments of the Company's internal control and related systems and processes. The Wealth Management & Fiduciary Committee reviews and assesses all key risk issues related to the wealth management and fiduciary activities of the Company and reports regularly to the Board on its activities. Together with the Senior Risk Management Officer of the Company, the CN&G Committee engages in a risk assessment of the employee compensation plans of the Company and reports its findings and conclusions to the Board.

        Each of these Board committees makes regular reports to the full Board regarding their deliberations and actions. Managers from each of the primary functional lines of business make presentations to the Board throughout the year which include a summary of key business issues and challenges. The CEO schedules longer "focus" presentations to the Board regarding strategic planning, annual budget, capital plan, compensation, products and technology, among other areas. The Senior Risk Management Officer makes a regular report directly to the Board regarding enterprise risk management of the Company and provides the Board with annual supervisory examination reports from the Company's primary regulators. The primary regulators of the Bank and the Corporation also make annual presentations to the Board. Finally, the CFO provides monthly financial reporting packages to the Board.

        Contacting the Board of Directors:    Individuals can contact the Board, any Committee, or select Board members (including the independent directors as a group) by sending an email to bdofdirectors@cnb.com or by writing to: Board of Directors, Attention: Corporate Secretary, City National Corporation, 555 S. Flower Street, 18th Floor, Los Angeles, California 90071. This contact information is also provided on the CNC Corporate Governance Web Page. The Audit & Risk Committee has also established procedures for the receipt, retention and treatment of so-called "Whistleblower" complaints regarding accounting and auditing matters or actual or potential corporate fraud or violation of applicable law, which procedures are stated on the CNC Corporate Governance Web Page.

The Compensation, Nominating & Governance Committee:

        The CN&G Committee is appointed by the Board to assist with director and officer compensation matters, recommend director nominees, and review and recommend appropriate policies and guidelines for governance matters. Each member of the CN&G Committee is an independent director as defined by the requirements of the NYSE and our Independence Standards.

        Compensation Matters:    The CN&G Committee's responsibilities with respect to compensation matters, as discussed in detail in its charter, include reviewing and approving:

•

Annually, management's recommendations and criteria for the overall annual compensation to be paid to or accrued for all officers in the aggregate;



•

Annually, management's recommendations for compensation of members of the Strategy and Planning Committee (S&P Committee) other than the CEO, and all other officers earning an annual base salary of $250,000 or more. (The S&P Committee includes the Chairman of the Board, the CEO, the Chief Financial Officer and the President of the Bank);



•

The terms of employment of the CEO and other members of the S&P Committee and all other officers earning an annual base salary of $250,000 or more, including terms of employment contracts, termination agreements, change in control agreements, and recommendations of management to promote any person to an officer position of Executive Vice President or higher;

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•

Corporate goals and objectives relevant to CEO compensation, including evaluating the CEO's performance in light of those goals and objectives, and recommending to the Board the CEO's compensation in light of those goals and objectives;



•

Recommendations to the Board for approval, subject as necessary or appropriate to stockholder approval, regarding stock option plans and other equity-based compensation plans that permit payment in or based on the Corporation's stock in connection with the CN&G Committee's administration of such plans; and reviewing and approving other compensation plans (and material amendments) in which the directors, the CEO, other members of the S&P Committee or any other officers earning an annual base salary of $250,000 or more participate; and other broadly-based compensation plans (and material amendments) which are available to employees, officers or directors;



•

Changes to the compensation and benefits provided to the Board, including as members of Board committees and recommending such changes to the Board for approval;



•

The Compensation Discussion and Analysis (CD&A) section of the proxy statement; and



•

Reports to the Board regarding compensation matters.

        Role of Compensation Consultants:    The CN&G Committee has the sole authority to retain and terminate any compensation consultant directly assisting it in the evaluation of director, CEO or senior executive compensation. The CN&G Committee also has the sole authority to approve fees and other engagement terms. In 2010, the CN&G Committee retained the services of George Paulin, Chairman and CEO of Frederic W. Cook, as its independent consultant to provide advice and recommendations on the terms and agreement for the CEO's compensation. The CN&G Committee also retained the services of Frederic W. Cook to work with the Company's senior risk officers to conduct a comprehensive risk review of the Company's employee plans to identify general areas of risk or potential for unintended consequences that exist in the design of the Company's compensation programs and to evaluate the Company's incentive plans relative to enterprise risk factors to identify potential areas of concern. See below under CD&A, Risk Management. In its absolute discretion, the CN&G Committee may also seek advice and assistance from internal or external legal, accounting or other advisors. The CN&G Committee may also form and delegate authority to subcommittees when appropriate.

        Our management team retains other compensation consultants. In 2010, we utilized the services of Semler Brossy Consulting Group (SBCG) and Towers Watson. We retained SBCG to analyze and provide recommendations with regard to the Company's equity program and key non-equity incentive plans, to analyze the competitiveness of certain compensation programs, and to provide other general compensation services. We utilized Towers Watson to provide surveys of competitive pay practices, to consult on refinements of key incentive and bonus plans, and to prepare specific change in control calculations for disclosure in the Company's annual proxy statement.

        Board Diversity:    We are committed to creating a culture and workplace that values individuals' similarities and differences. We continually strive to build a diverse base of clients, colleagues and vendors to promote the diversity of our communities in the markets we serve. This commitment to diversity plays an important role in achieving our objective to become the most recommended financial provider. Similarly, we value diversity among our Board members. As provided in our Guidelines, when reviewing the qualifications of director nominees, the CN&G Committee considers, among other factors, whether the nominee will assist in achieving a mix of Board members that represents a diversity of skills, background, viewpoints, experiences, industry knowledge, and community contacts, including with respect to age, gender, demographics, race and specialized experience. The CN&G Committee instructs search firms to identify candidates reflecting diversity, including with regard to race, gender and specialized experience. We periodically discuss the value of diversity both at the Board and at the management level.

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The CN&G Committee assesses the effectiveness of this approach to diversity as part of its annual review of its charter and the Guidelines.

        Nomination and Director Qualifications:    In carrying out its responsibility to recommend and identify nominees for election to the Board, the CN&G Committee is authorized to retain search firms, as well as obtain advice and assistance from internal or external legal, accounting or other advisors. Nominations for the election of directors may be made by a stockholder of record entitled to vote for the election of directors by complying with the procedures set forth in the Corporation's bylaws for nominations of persons for election to the board of directors. The Corporation did not receive any stockholder nominations for the 2011 annual meeting.

        The CN&G Committee identifies, screens and recommends to the Board candidates for membership on the Board, including nominees proposed by stockholders, if any, on the basis of candidate guidelines established by the CN&G Committee and approved by the Board as well as those qualifications for directors set forth in the Guidelines. These criteria and factors include whether the candidate (i) has demonstrated notable or significant achievements in business, education, or public service; (ii) has the requisite intelligence, education and experience to make a significant contribution to the membership of the Board of Directors; (iii) will serve as a significant and active resource for referrals and business development for the Company; (iv) will assist in achieving a mix of Board members that represents a diversity of skills, background, viewpoints, experiences, industry knowledge and community contacts, including with respect to age, gender, demographics, race and specialized experience; and (v) has the highest ethical standards, a strong sense of professionalism and dedication to serving the interests of all the stockholders and will be available to the Board of Directors in the fulfillment of director duties. In addition to the particular experiences, qualifications, attributes and skills discussed with respect to each director in Proposal 1, Election of Directors, the CN&G Committee believes that all of the members of the Board satisfied or met the foregoing criteria and factors.

        The director candidates and the foregoing criteria, including diversity, is considered by the CN&G Committee in light of the contribution and responsibility that the Board of Directors has to provide guidance and oversight to management, including reviewing the Corporation's business strategies and financial performance, providing advice and insight into general and local economic and business conditions that may affect the Company's business, reviewing key risks in the Company's business, reviewing and approving major transactions, ensuring processes are in place for promoting integrity in the conduct of management and other colleagues, and ensuring processes are in place for mandating integrity and transparency in financial reporting.

        The CN&G Committee facilitates the annual assessment of the Board's performance and each of its standing committees. The CN&G Committee also reviews the adequacy of the Guidelines and the Codes and recommends and proposes changes to the Board for approval.

        Compensation Committee Interlocks and Insider Participation:    None of the members of the CN&G Committee in 2010 has ever been an officer or employee of the Corporation or any of its subsidiaries. During 2010, no executive officer or employee-director of the Corporation served as a director of an entity where a member of the CN&G Committee or any other independent Director of the Corporation is an executive officer.

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The Audit & Risk Committee:

        Each member of the Audit & Risk Committee is an independent director as defined by the requirements of the NYSE and our Independence Standards, and is "financially literate" as determined by the Board of Directors in its business judgment. Under the Guidelines, Committee members are not expected to serve simultaneously on the audit committees of more than two other public companies, unless the Board determines that such service is (i) not otherwise prohibited and (ii) will not impair the effectiveness and ability to serve effectively on the Audit & Risk Committee. The Committee also functions as the Audit & Risk Committee of the Bank and the Trust Audit Committee with audit oversight responsibility for audit, risk and compliance related wealth management and fiduciary activities of the Company.

        The following "Report by the Audit & Risk Committee" shall not be deemed "soliciting material" or incorporated by reference by any general statement incorporating this proxy statement into any filing under the Securities Act of 1933, as amended, or under the Securities Exchange Act of 1934 Act, as amended (1934 Act) except to the extent that the Corporation specifically incorporates this information by reference, and shall not otherwise be deemed filed under such Acts.

Report By The Audit & Risk Committee

        The charter of the Audit & Risk Committee ("we" or "the Committee") states that the Committee's purpose is to assist the Board in fulfilling its oversight responsibilities regarding monitoring and oversight of:

•

The integrity of the Corporation's financial statements and financial accounting practices;



•

The effectiveness of the Corporation's internal control over financial reporting;



•

The Corporation's compliance with legal and regulatory requirements;



•

The qualifications and independence of the Corporation's internal auditors and independent registered public accounting firm;



•

The performance of the Corporation's internal audit function and independent registered public accounting firm; and



•

All risk management activities, including audit, credit risk review and Enterprise Risk Management functions, as well as all risk management functions, and Enterprise Risk Management activities of the Company performed by management, all management committees, as well as other Board Committees.

        In carrying out these responsibilities, the Committee, among other things:

•

Discusses with management, the internal auditors and the independent registered public accounting firm the adequacy and effectiveness of the Corporation's and subsidiaries' internal controls regarding financial, accounting, regulatory and legal compliance;



•

Reviews and discusses with management and the Corporation's independent registered public accounting firm financial results prior to the release of earnings and quarterly and annual financial statements, including Management's Discussion and Analysis of Financial Condition and Results of Operations and the results of the independent registered public accounting firm's quarterly review and annual audit of the financial statements, prior to the filing of the Corporation's quarterly and annual reports on Forms 10-Q and 10-K;



•

Reviews disclosures made by the Corporation's Chief Executive Officer and Chief Financial Officer related to their certification process for the annual and quarterly reports concerning any significant deficiencies in the design or operation of internal controls or any material weaknesses therein and

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any fraud involving management or other employees who have a significant role in the Corporation's internal controls;

•

Reviews reports from management, including, as appropriate, the senior officers of Risk Management, Internal Audit, Compliance and Credit Risk Review, to monitor and oversee the Corporation and its subsidiaries' conformity with internal controls, applicable legal and regulatory requirements, and reviews material reports received from regulators or governmental agencies;



•

Discusses with management the Corporation's risk assessment and risk management policies; and



•

Reviews management's report on its assessment of the effectiveness of internal control over financial reporting as of the end of each fiscal year, and the independent registered public accounting firm's report on the effectiveness of internal control over financial reporting.

        During 2010, the Audit & Risk Committee conducted meetings in a manner designed to facilitate effective and complete communication among the committee members, management, internal auditors, risk management and compliance officers and the Corporation's independent registered public accounting firm, KPMG. Among the matters discussed with the Corporation's internal audit, risk management and compliance officers, as well as KPMG, was the overall scope and plans for their respective audits and controls assessments. During 2010, the Committee met in executive session with the internal auditors, the senior risk management officer, the general counsel, and KPMG, to discuss the result of their examinations, observations and recommendations regarding financial reporting practices, the effectiveness of the Corporation's internal controls and significant risks affecting the Company.

        In performing its function, during the year ended December 31, 2010, the Committee has:

•

Reviewed and discussed the audited financial statements of the Corporation as of and for the year ended December 31, 2010 with the Corporation's management;



•

Discussed with the Corporation's independent registered public accounting firm all matters required to be discussed by SAS 114 (Codification of Statements on Auditing Standards, AU § 380), as may be modified or supplemented;



•

Received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the Public Accounting Oversight Board regarding the independent accountant's communications with the audit committee concerning independence, and has discussed with the independent accountant the independent accountant's independence; and



•

Reviewed and approved all fees paid to KPMG for all audit and non-audit related services in accordance with the Committee's policy on Pre-Approval of Audit and Non-Audit Related Services,.

        The Committee has also reviewed and overseen the Corporation's and KPMG's review and assessment process related to Section 404 of the Sarbanes-Oxley Act of 2002, including the Public Company Accounting Oversight Board's Auditing Standard No. 5 regarding the audit of internal control over financial reporting. Based on the foregoing review and discussions, the Audit & Risk Committee recommended to the Board of Directors that the Corporation's audited financial statements be included in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2010 for filing with the SEC.

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(1)

The retainers are paid bi-annually in January and July.

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(1)

See Summary Compensation Table for compensation of Russell Goldsmith and Christopher J. Warmuth. See discussion under Transactions with Related Persons for compensation of Bram Goldsmith. Directors who are employees of the Company receive no compensation for services as Directors. Michael Meyer retired from the Board of Directors effective April 21, 2010; Robert Tuttle was elected to the Board as of February 24, 2010; and Alison Davis was elected to the Board of Directors as of December 15, 2010.

(2)

Fees include the 2010 Annual Award, which was deferred by each non-employee director to the Director DCP and allocated to the CNC Stock Fund. Each director was allocated 604 Stock Fund Units.

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(1)

Includes shares subject to employee stock options which are presently exercisable or which will become exercisable within 60 days after February 1, 2011. Does not include restricted stock units issued pursuant to the 2008 Plan or under the Company's previous stock plans (together, Company Omnibus Plans). Restricted stock units do not have voting rights and do not convert to shares until termination of employment. Does not include stock fund units issued pursuant to the Company's executive deferred compensation plan, which stock fund units do not have voting rights and do not convert to shares until termination of employment. See below under Security Ownership of Management for further information on vested restricted stock units and stock fund units held at February 1, 2011.

(2)

Based on 52,880,084 shares of common stock outstanding at February 1, 2011.

(3)

Shares allocated to Bram Goldsmith's account under the Profit Sharing Plan.

(4)

The Goldsmith Family Foundation is a tax-exempt charitable foundation of which Bram Goldsmith and Russell Goldsmith are directors and officers. Bram Goldsmith and Russell Goldsmith each disclaim beneficial ownership of these shares.

(5)

Shares held in a trust for the benefit of a family member for which Bram Goldsmith is the sole trustee.

(6)

The Goldsmith Family Partnership is a limited partnership whose general partners include the Russell Goldsmith Trust, of which Russell Goldsmith is the sole trustee and the West LA Investment Trust No. 1-R, of which Russell Goldsmith is the sole trustee. Russell Goldsmith disclaims beneficial ownership of the shares held by the Goldsmith Family Partnership except to the extent of Russell Goldsmith's respective pecuniary interest in the partnership.

(7)

Excludes the 2,860,000 shares identified as being held by the Goldsmith Family Partnership which the Russell Goldsmith Trust may be deemed to beneficially own as a general partner of the Goldsmith Family Partnership.

(8)

ELM 2006 Charitable Annuity Lead Trust is a charitable trust for which Russell Goldsmith is the sole trustee.

(9)

Shares held in trusts for the benefit of family members for which Russell Goldsmith is the sole trustee.

(10)

California Quintet LLC is a limited liability company whose managing members are Russell Goldsmith and his spouse. Russell Goldsmith disclaims beneficial ownership of the shares held by California Quintet LLC except to the extent of his pecuniary interest therein.

(11)

Maple-Pine Limited Partnership is a limited partnership of which Russell Goldsmith is the General Partner.

(12)

Includes 142,220 shares solely owned by Russell Goldsmith, 2,764 shares allocated to Russell Goldsmith's account under the Profit Sharing Plan and 917,270 stock options exercisable within 60 days after February 1, 2011.

(13)

The B.N. Maltz Foundation is a tax-exempt charitable foundation of which Russell Goldsmith is a director. Russell Goldsmith disclaims beneficial ownership of these shares.

(14)

Shares held in trust for the benefit of a family member for which Russell Goldsmith is the special trustee with voting power but no investment control and no pecuniary interest in any transaction involving shares of the Company held by the trust.

(15)

MKB Co. Ltd. is a limited liability company whose managing members include Russell Goldsmith's spouse. The number of shares of City National Corporation held by MKB Co. Ltd. exceeds her pecuniary interest therein. Russell Goldsmith disclaims beneficial ownership of these shares.

(16)

Separate beneficial ownership information provided for Bram Goldsmith (although not required) to provide specific information regarding duplicate ownership. After appropriate elimination of duplicate ownership attributable to both Russell Goldsmith and Bram Goldsmith under the Goldsmith Family Foundation (see footnote 4), Bram Goldsmith and Russell Goldsmith and their related interests beneficially own 7,203,540 shares which constitutes 13.6% of the outstanding shares.

(17)

Based solely upon information contained in a Form 13G filing with the SEC. Of the 2,708,623 shares beneficially owned by FMR LLC, it has sole voting power as to 246,314 shares and sole dispositive power as to 2,708,623 shares. The "Percent of Class" calculation in the table was made using the 2,708,623 shares reported as beneficially owned in the Form 13G filing and the 52,880,084 shares of our common stock outstanding as of February 1, 2011.

(18)

Based solely upon information contained in a Form 13G filing with the SEC. Of the 3,154,382 shares beneficially owned by Lord, Abbett & Co. LLC, it has sole voting power as to 2,977,381 shares and sole dispositive power as to 3,151,551 shares. The "Percent of Class" calculation in the table was made using the 3,154,382 shares reported as beneficially owned in the Form 13G filing and the 52,880,084 shares of our common stock outstanding as of February 1, 2011.

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Percentage information is omitted for those individuals whose beneficially owned shares represent less than 1% of the outstanding shares of the Corporation's common stock. Percentage information is based on 52,880,084 shares of common stock outstanding at February 1, 2011.

(1)

Includes restricted stock issued pursuant to the Company Omnibus Plans which has voting rights but not dispositive power. Excludes shares subject to stock options listed in column (b), restricted stock units issued pursuant to the Company Omnibus Plans listed in column (d), and stock fund units issued pursuant to the Company's deferred compensation plans listed in column (e).

(2)

Represents shares subject to options which are presently exercisable or which will become exercisable within 60 days after February 1, 2011.

(3)

Represents vested restricted stock units issued pursuant to the Company Omnibus Plans, including restricted stock units that will vest within 60 days of February 1, 2011. These units do not have voting rights and do not convert to shares until six months after termination of employment. Value is based on market price of the Company's common stock together with dividend equivalents on that stock.

(4)

Represents units held in the CNC Stock Fund under the Executive Deferred Compensation Plan for executive officers and under the Director Deferred Compensation Plan for outside directors. Units held in the CNC Stock Fund do not have voting rights. Distributions from the CNC Stock Fund are in shares of the Company's common stock following termination of employment, in the case of an officer, or termination of service, in the case of a director.

(5)

Richard Bloch has shared voting and investment power in these shares that are held in a trust of which he is a co-trustee. These shares have been pledged to the Bank to secure a line of credit made by the Bank to Mr. Bloch.

(6)

Includes 1,785 shares allocated to Michael B. Cahill's account under our Profit Sharing Plan. Includes 13,161 shares of restricted stock.

(7)

Includes 4,849 shares allocated to Christopher J. Carey's account under our Profit Sharing Plan. Includes 12,669 shares of restricted stock.

(8)

Kenneth L. Coleman has shared voting and investment power in these shares that are held in a trust of which he is a co-trustee.

(9)

Includes 2,869 shares allocated to Brian Fitzmaurice's account under our Profit Sharing Plan. Includes 31,886 shares of restricted stock.

(10)

See notes following Principal Owners of Common Stock above for detail regarding beneficial ownership.

(11)

See notes following Principal Owners of Common Stock above for detail regarding beneficial ownership.

(12)

Ronald L. Olson has shared voting and investment power in these shares that are held in a trust of which he is a co-trustee.

(13)

Bruce Rosenblum has shared voting and investment power in these shares that are held in a trust of which he is a co-trustee.

(14)

Christopher J. Warmuth has shared voting and investment power in 9,985 of these shares that are held in a trust of which he is a co-trustee. Includes 7,049 shares allocated to Christopher J. Warmuth's account under our Profit Sharing Plan. Includes 15,308 shares of restricted stock.

(15)

In addition to the ownership disclosed for the persons identified in the Security Ownership of Management table, the beneficial ownership of two additional "Executive Officers" are included in the totals for Columns (a), (b) and (c) of the table. "Executive Officers" mean those individuals designated as such for purposes of Section 16 of the 1934 Act. The number of shares beneficially owned by all of our directors and executive officers as a group is as follows: 6,569,530 (which amount includes 138,806 shares of restricted stock and 69,692 shares allocated to executive officers' accounts under our Profit Sharing Plan) plus; 1,311,224 shares subject to options (see footnote 2) for a total of 7,880,754 shares, representing 14.9% of the outstanding shares of our common stock as of February 1, 2011. 91,455 of these shares are pledged as security (see footnote 5). The sum total for column (c) reflects appropriate elimination of duplicates attributable to both Russell and Bram Goldsmith under the Goldsmith Family Foundation.

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Percentage information is omitted for those individuals whose beneficially owned shares represent less than 1% of the outstanding shares of the subsidiary's preferred stock.

(1)

Includes 500 Series A shares owned by the Goldsmith Family Foundation and 600 Series A shares owned by trusts of which members of the family of Bram Goldsmith are the beneficiaries and Bram Goldsmith is the sole trustee. Shares owned by the Goldsmith Family Foundation are also shown as being beneficially owned by Russell Goldsmith. Bram Goldsmith disclaims beneficial ownership of the shares owned by the Goldsmith Family Foundation.

(2)

Includes 500 Series B shares owned by the Bram and Elaine Goldsmith Trust and 300 Series B shares owned by the Elaine Goldsmith Revocable Trust, of which trust Bram Goldsmith is a co-trustee.

(3)

Includes 500 Series A shares owned by the Goldsmith Family Foundation. Shares owned by the Goldsmith Family Foundation are also shown as being beneficially owned by Bram Goldsmith. Russell Goldsmith disclaims beneficial ownership of the shares owned by the Goldsmith Family Foundation. Also includes 300 Series A shares owned by trusts of which members of the family of Russell Goldsmith are the beneficiaries and Russell Goldsmith is the sole trustee.

(4)

Includes 150 Series B shares owned by trusts of which members of the family of Russell Goldsmith are the beneficiaries and Russell Goldsmith is the sole trustee.

(5)

The sum total for this column reflects appropriate elimination of duplicates attributable to both Russell and Bram Goldsmith under the Goldsmith Family Foundation (see footnotes 1 and 3).

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Percentage information is omitted for those individuals whose beneficially owned shares represent less than 1% of the outstanding shares of the Subsidiary's preferred stock.

(1)

Includes 100 shares owned by Bram Goldsmith's spouse. Bram Goldsmith disclaims beneficial ownership of the shares held by his spouse.

(2)

These shares are owned by trusts of which members of the family of Russell Goldsmith are the beneficiaries and Russell Goldsmith is the sole trustee.