Nelson Chung
CATHAY GENERAL BANCORPAbout Nelson Chung
Lead Independent Director of Cathay General Bancorp since 2017; Director since 2005; age 72. President of Pacific Communities Builder, Inc., with over 30 years in residential real estate development in Southern California; holds a Master of Urban Design and is a licensed architect, general contractor, and real estate broker. Chung beneficially owned 45,519 shares as of March 20, 2025 (including holdings via a Defined Benefit Plan, S.O.D. Co Money Purchase Plan, and the Chung Family Trust) .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Pacific Communities Builder, Inc. | President | 30+ years | Built >5,500 home sites; developed >150 communities in Southern California; licensed architect/general contractor/real estate broker |
External Roles
- No other public company directorships disclosed in the proxy biography for Chung .
Board Governance
- Roles: Lead Independent Director (elected annually by independent directors); member, Risk Committee .
- Lead Independent Director responsibilities: preside over executive sessions of independent directors; facilitate communications with Chair/CEO; consult on governance and Board performance .
- Independence: Board determined Chung is “independent” under Nasdaq rules; he serves only on committees composed of independent directors (Risk Committee is chaired by an independent director; Audit/Compensation/Nomination are fully independent) .
- Attendance and engagement: Board held 7 meetings in 2024; each director attended >75% of Board and committee meetings; independent directors met in executive session six times; all directors attended the 2024 annual meeting .
- Committee activity: Risk Committee held 5 meetings in 2024 (Chung member); Investment Committee held 3 (not a member); Audit held 10; Compensation 7; Nomination & Governance 7 .
Fixed Compensation
- Structure (directors): $55,000 annual cash retainer; $750 per committee/special meeting and per executive session of independent directors; $35,000 annual retainer for Lead Independent Director; $15,000 for Audit Chair; $10,000 for other committee chairs; employee Vice Chairs (Tang/Wu) receive base salaries plus director retainers and fees; annual equity grants of common stock to non-employee directors targeted at $85,000 (April 12, 2024 grant) .
| Year | Cash Fees ($) | Stock Awards ($) | Options ($) | Total ($) |
|---|---|---|---|---|
| 2023 | 105,750 | 84,981 | — | 190,731 |
| 2024 | 104,250 | 84,999 | — | 189,249 |
Performance Compensation
- Annual director equity grant: common stock with target value $85,000 based on closing price on April 12, 2024; no options; vesting terms not specified in the proxy for directors (grants are additional compensation for Board/committee service) .
| Item | Detail |
|---|---|
| Equity type | Common stock (no options) |
| Target grant value | $85,000 |
| Grant date (2024) | April 12, 2024 |
| Performance conditions | None disclosed for director equity; awards are compensation for Board/committee service |
Other Directorships & Interlocks
- None disclosed for Chung; no public company interlocks identified in his biography .
- Related-party transactions policy: Audit Committee reviews/approves related party transactions; Regulation O governs extensions of credit; directors must abstain from decisions affecting personal interests .
- Notable related-party transaction disclosed pertains to a lease with an entity owned by Director Richard Sun; no material related-party transactions involving Chung disclosed; banking transactions with directors conducted on market terms; “except as indicated above, there are no existing or proposed material transactions” with directors/executives/5% holders .
Expertise & Qualifications
- Leadership and operational experience; finance and risk management oversight; deep real estate expertise; academic credential in urban design; licensed architect/general contractor/real estate broker .
Equity Ownership
| Holder | Shares Beneficially Owned | % of Outstanding | Noted Holdings |
|---|---|---|---|
| Nelson Chung | 45,519 | ≤1% | Includes 10,000 shares in Nelson Chung Defined Benefit Plan; 10,000 shares in S.O.D. Co Money Purchase Plan; 18,593 shares in Chung Family Trust |
- Director ownership guidelines: increased to 3× annual cash retainer as of January 18, 2024; all current directors meet the requirement or are within the five-year grace period .
- Pledging/hedging: Board policy prohibits pledging/hedging/margin accounts without prior Board approval; no such approvals requested/granted .
- Section 16 compliance: No delinquent filings noted for Chung; overall compliance affirmed for 2024, with limited late filings disclosed for other individuals .
Governance Assessment
- Board effectiveness: Chung’s Lead Independent Director role and Risk Committee membership indicate strong independent oversight of governance and enterprise risk, with robust executive session cadence and high attendance .
- Alignment: Mix of cash and annual stock grants supports skin-in-the-game; individual beneficial ownership and stricter 3× retainer guidelines bolster alignment; no pledging allowed .
- Conflicts: No material related-party exposure disclosed for Chung; policy frameworks and abstention requirements mitigate conflict risk; banking transactions with directors at market terms .
- Shareholder signals: 2024 say‑on‑pay support of 94.22% suggests positive investor sentiment toward compensation governance broadly (executive program), indirectly supportive of Board oversight structures; Compensation Committee uses independent consultant F.W. Cook .
- Red flags: None observed specific to Chung—no pledging, no material related-party transactions, and independence affirmed; note that excise tax gross-ups exist in older change‑of‑control agreements for certain executives (not directors), but not applicable to Chung .
Overall, Chung’s long real estate background, formal independence, leadership as Lead Independent Director, and risk oversight role are positives for investor confidence; the compensation mix and ownership guideline compliance support alignment, with low conflict indicators based on disclosures .