Ralph Andretta
About Ralph Andretta
- President & CEO of Bread Financial since Feb 2020; prior roles: Managing Director/Head of U.S. Cards at Citigroup (2011–2019), global affinity/international card executive at Bank of America (2010–2011), 18 years at American Express; B.S., Siena College. Age 64 (2025 proxy) .
- Board service: Director since 2020; not independent; serves on no committees; Board maintains an independent Chair structure since 2009 (Roger Ballou), separating Chair/CEO roles and enhancing oversight .
- Business performance context under his tenure: 2024 financials included CET1 ratio 12.4%, tangible book value per share of $46.97, consumer deposits $7.7B (43% of funding), and parent debt reduction actions; strategic wins with new/extended partnerships (Hard Rock, HP, Saks) and operational efficiency initiatives .
- Pay vs performance indicators: 2024 Net Income $277MM and PPNR $1,778MM; Company cumulative TSR value $74.74 (per $100 invested baseline) in 2024; CEO “Compensation Actually Paid” $21.6MM in 2024, reflecting equity value movements tied to performance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Bread Financial | President & CEO; Director | 2020–present | Led portfolio diversification to co-brand/D2C, strengthened capital/liquidity, won/extended major partner programs |
| Citigroup | Managing Director, Head of U.S. Cards; prior loyalty/co-brand/product roles | 2011–2019 | Scaled cards franchise; deep co-brand/loyalty expertise |
| Bank of America | Global affinity & international card executive | 2010–2011 | Drove affinity/international cards initiatives |
| American Express | Various leadership roles | 18 years (pre-2010) | Loyalty/marketing/data capabilities foundational to current strategy |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Nationwide Children’s Hospital | Trustee | 2020–present | Non-profit governance experience |
| Women’s Sports Foundation | Trustee | 2023–present | Non-profit board experience |
| Bob Woodruff Foundation | Director | 2024–present | Non-profit board experience |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 1,138,846 | 1,155,000 | 1,155,000 |
| All Other Compensation ($) | 99,548 | 155,483 | 296,346 (includes $216,658 dividends on RSUs; $34,104 perqs) |
Perquisites detail (2024): executive life insurance $10,536; financial planning $15,000; supplemental disability $8,568 .
Performance Compensation
Annual Incentive (AIC)
| Item | 2022 | 2023 | 2024 |
|---|---|---|---|
| Actual AIC Paid ($) | 2,615,590 | 2,347,191 | 2,852,850 |
| Target AIC ($) | — | 2,079,000 (180% of $1,155,000) | 2,194,500 (per 2024 grant table; implied ~190% of salary) |
| Threshold/Max Payout | — | — | Threshold $877,800; Max $5,047,350 |
2024 AIC scorecard metrics and structure:
- Financial/operational measures (core scorecard): PPNR 30%; Average Loans 10%; Net Credit Losses (NCLs) 10%; Operating Leverage 10%; ERM Composite 10%; Tech SLAs 5%; Digital Engagement 5%; Application Availability 5%; NPS 5% .
- Strategic modifiers: CFPB Late Fee Rule readiness; Operational Excellence (± modifiers) .
- Payout cap at 100% unless Financial metrics in aggregate ≥85% (then modifiers can apply) .
- Categories reflect Stockholder/Customer/Associate focus; payouts formulaic per pre-set ranges .
Long-Term Equity (LTIC)
- Mix: 60% PBRSUs, 40% TBRSUs (for 2024 grants) .
- 2024 PBRSUs: primary metric ROE, measured annually over 3 years; 3-year cliff vest in Feb 2027; target shares granted to Andretta: 101,153; threshold 50,577; max 151,730 .
- 2024 TBRSUs: 67,435 units; vest 33% on 2/15/25, 33% on 2/15/26, 34% on 2/18/27 .
- 2025 design change (new grants): 75% ROTCE, 25% EPS; ±10% rTSR modifier vs defined peer group (responding to shareholder feedback) .
Vesting events and realized outcomes:
- 2021–2023 PBRSUs paid at 130% of target based on 3-year ROE with rTSR modifier; Andretta earned 51,319 shares (vs 39,476 target) on 2/16/2024 .
- On 2/15/2025, 48,207 PBRSUs (2011–?) under time-only restriction vested; TBRSUs of 50,554 also vested (with similar schedules for subsequent years) .
- 2024 vesting value realized (all NEOs table): Andretta 101,723 shares vested in 2024; 46,134 withheld for taxes .
2024 Stock awards grant-date fair value to Andretta: $6,333,851 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 172,361 shares as of Mar 20, 2025 (<1%) |
| Unvested Outstanding (12/31/24) | TBRSUs 115,527; PBRSUs (target) 101,153; PBRSUs under time-only restriction 48,207 |
| Ownership Guidelines | Executives must hold stock equal to a multiple of salary; includes 70% of unvested TBRSUs; hold 50% of net after-tax shares until in compliance; expected within 5 years |
| Compliance Status (NEOs) | As of 3/31/2025, all current NEOs meet holding requirement; all except new CTO meet ownership guidelines |
| Hedging/Pledging | Prohibited for directors/officers/associates; no margin/pledge, no short sales, puts/calls; pre-clearance and trading windows required |
Vesting-related supply indicators:
- 2025 TBRSU vest (50,554) and PBRSU time-based vest (48,207) occurred on 2/15/2025; prior vestings used share withholding for taxes (e.g., 46,134 shares withheld in 2024), limiting open-market sales pressure .
Employment Terms
- No cash employment/severance agreements or ongoing change-in-control cash benefits for NEOs disclosed; equity plan governs treatment .
- Equity treatment on change-in-control: if awards not accelerated/assumed and executive is terminated without cause or resigns for good reason within 12 months post-CIC, all restrictions lapse and awards fully vest (double-trigger) .
- Illustrative CIC termination value at 12/31/2024 (assumes target): Andretta $21,505,698 (equity acceleration; excludes base items, only enhanced benefits) .
- Clawback: SEC- and NYSE-compliant recoupment policy for restatements .
Board Governance (Director Service)
- Board Service: Director since 2020; no committee roles .
- Independence: Not independent; Board features independent Chair and fully independent committees; Andretta is the sole non-independent director nominee, supporting independent oversight .
- Dual-role implications: Separation of Chair/CEO mitigates common CEO/Chair concerns; independent directors meet in executive session regularly; robust evaluation and refreshment processes .
Director Compensation (as CEO-Director)
- As an officer-director, Andretta receives no additional director compensation; only non-employee directors receive retainers/equity .
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑Pay support: ~75% (2023 vote on 2022 pay); ~82% (2024 vote on 2023 pay) .
- 2025 response actions: Enhanced PBRSU design to multi-metric (ROTCE/EPS) with relative TSR modifier and further disclosure transparency .
Compensation Structure Analysis
- Year-over-year mix remains heavily performance‑weighted: ~88% CEO target pay at risk in 2024; PBRSUs 60% of LTIC, TBRSUs 40% .
- 2024 AIC design tightened alignment (higher financial weight; cap unless financials ≥85%); strategic modifiers address regulatory readiness and operational excellence .
- 2025 LTIC improvements add earnings quality (ROTCE), growth (EPS), and market-relative check (rTSR) to address single-metric risk in prior designs .
- No option repricing or option grants; equity is RSU/PBRSU-only, reducing risk of underwater option repricing .
Risks, Red Flags, and Mitigants
- Red flags avoided: No pledging/hedging; independent Chair; no tax gross‑ups disclosed; strong clawback; no option repricing .
- Regulatory/credit cycle risk addressed in pay design through NCLs, ERM composite, operating leverage, and technology KPIs; 2025 LTIC metrics broadened .
- Related-party transactions: None reported since beginning of 2024 .
Multi‑Year Compensation and Ownership Tables
CEO Summary Compensation (USD)
| Component | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | 1,138,846 | 1,155,000 | 1,155,000 |
| Bonus | — | — | — |
| Stock Awards | 4,840,698 | 4,039,912 | 6,333,851 |
| Non‑Equity Incentive (AIC) | 2,615,590 | 2,347,191 | 2,852,850 |
| All Other Comp | 99,548 | 155,483 | 296,346 |
| Total | 8,694,682 | 7,697,586 | 10,638,047 |
2024 Equity Grants (Andretta)
| Grant | Grant Date | Threshold | Target | Max | Vesting |
|---|---|---|---|---|---|
| PBRSUs | 2/15/2024 | 50,577 sh | 101,153 sh | 151,730 sh | 3‑year cliff (Feb 2027); ROE metric |
| TBRSUs | 2/15/2024 | — | 67,435 sh | — | 33% 2/15/25; 33% 2/15/26; 34% 2/18/27 |
Ownership and Outstanding Awards (as of 12/31/2024)
| Item | Shares/Value |
|---|---|
| Beneficially Owned (3/20/2025) | 172,361 sh |
| Unvested TBRSUs | 115,527 sh (value $7,054,079) |
| PBRSUs (time‑restricted) | 48,207 sh (vested 2/15/25) |
| PBRSUs (target for 2024–2026 cycle) | 101,153 sh (value $6,176,402 at 12/31/24) |
| 2024 Vested Shares (value) | 101,723 sh; $3,767,309; 46,134 withheld for taxes |
Performance & Track Record
- 2024 highlights: CET1 12.4%; TBVPS $46.97; 85% of loans secured through ≥2026; parent convertible notes repurchase; direct-to-consumer deposits $7.7B (43% funding) .
- 2025 Q3 (latest call): Net loss rate trending to low end of 7.8–7.9% FY outlook; tangible book $56.36; ROTCE 28.6% in Q3; dividend raised 10% and additional $200MM buyback auth; Moody’s upgrade .
Investment Implications
- Alignment: High at‑risk mix (AIC + PBRSUs) tied to PPNR, credit quality, operating leverage, and shareholder outcomes; 2025 LTIC adds EPS/ROTCE and rTSR guardrail—supportive for long-term value creation .
- Retention/Supply: Meaningful multi‑year vesting pipeline (2024–2027) supports retention; tax withholding on vestings reduces open‑market sell pressure .
- Governance: Independent Chair and robust clawback mitigate dual-role risks; no pledging/hedging and strong ownership/holding rules reinforce alignment .
- Pay optics: Say‑on‑pay support improved to 82% amid program enhancements; 2024 total comp rose on larger equity grants aligned with performance and design changes .
- Key watch items: Credit cycle/regulatory (late fee rule) sensitivities embedded in AIC; continued delivery on PPNR/ROTCE and disciplined capital returns (dividends/buybacks) should be supportive of TSR if execution persists .
Notes: All quantitative compensation values sourced from Bread Financial DEF 14A filings (2024, 2025). Equity and payout details reflect terms under the Omnibus plans and grant tables.