Eric M. Sprink
COASTAL FINANCIALAbout Eric M. Sprink
Eric M. Sprink, 52, is Chief Executive Officer and Director of Coastal Financial Corporation and Coastal Community Bank. He joined in late 2006 as President and COO and became CEO in 2010; he holds a bachelor’s degree from Arizona State University and an MBA from the University of North Carolina . Pay-versus-performance disclosure shows strong shareholder value creation: 2024 TSR of 404.33 vs peer group 134.22, Net Income of $45.2 million, and ROAA of 1.15% . The company uses ROAA, Core Deposit Growth, Gross Loan Growth, and Net Charge-offs as core performance levers in executive incentives .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Security Pacific Bank / Bank of America | Retail ops, consumer/commercial lending, wealth mgmt | — | Built multi-line banking expertise across lending and operations |
| Centura Bank | Retail operations and corporate finance management | — | Corporate finance and retail leadership experience |
| Washington Trust Bank | Senior management | — | Regional banking leadership |
| Global Credit Union | Senior management | — | Credit union leadership and operations exposure |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Community Bankers of Washington | Director and past Chair | — | Industry advocacy and governance leadership |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $700,000 | $810,000 | $842,000 |
| Discretionary Bonus ($) | $83,088 | — | $82,665 |
| Non-Equity Incentive ($) | $443,018 | $407,300 | $375,069 |
| Stock Awards (Grant Date Fair Value, $) | $700,018 | $726,125 | $508,823 |
| All Other Compensation ($) | $54,418 | $60,360 | $59,706 |
| Total ($) | $1,980,542 | $2,003,785 | $1,868,263 |
| 2024 Pay Mix (Percent of Total) | Base Salary | Cash Bonus | Equity Award | Other |
|---|---|---|---|---|
| Eric M. Sprink | 45.1% | 24.5% | 27.2% | 3.2% |
| 2024 Perquisites Detail | Amount ($) |
|---|---|
| Car allowance/lease: $13,200; Country club dues: $8,230; Medical/dental/vision premiums: $7,106; Spouse travel: $7,655; Mobile tech reimbursement: $1,500; HSA: $1,200 | $38,891 |
Performance Compensation
| Incentive Metric | Weight | 2024 Target | 2024 Actual | Achieved (%) | Payout Structure |
|---|---|---|---|---|---|
| Return on Average Assets | 40% | 1.27% | 1.15% | 90.6% | Thresholds: 70.87%→50%, 100%→100%, 123.31%→200% |
| Core Deposit Growth | 12.5% | 3.75% | 5.85% | 156.0% | Thresholds: 50%→50%, 100%→100%, 437%→200% |
| Gross Loan Growth | 12.5% | 11.40% | 15.15% | 132.9% | Thresholds: 60%→50%, 100%→100%, 216%→200% |
| Net Charge-offs (community bank) | 10% | 0.03% | 0.03% | 100.0% | Thresholds: 200% of target→50%, 100%→100%, 16% of target→200% |
| Strategic Objectives | — | Company-specific | Met | 100.0% | Discretionary component 25% of total |
| Key PSU Awards to CEO | Shares | Grant Date | Vesting/Conditions | Notes |
|---|---|---|---|---|
| PSUs (CEO) | 100,000 | 10/4/2021 | Cliff vest 10/4/2027; 50k tied to stock hurdles: $50 for 60 days→25k; $60 for 60 days→50k; 50k tied to relative ROAE≥90th percentile over 6 years | Aligns with long-term TSR and profitability |
Equity Ownership & Alignment
| Ownership Item | Detail |
|---|---|
| Total beneficial ownership | 105,540 shares; includes 100,579 held directly/jointly, 1,200 held by children, 3,761 options exercisable within 60 days of record date; excludes 100,000 unvested PSUs and 38,508 unvested RSUs; percent-of-class: <1% |
| Hedging/Pledging Policy | Hedging prohibited; pledging prohibited except limited exceptions with capacity to repay without pledged securities |
| Pledged shares (CEO) | None indicated for Sprink; table notes no pledges unless stated (none for Sprink) |
| Options outstanding | Unexercisable tranches at $7.20 (1,880, exp. 7/1/2025), $6.25 (3,763, exp. 2/24/2026), $6.50 (10,148, exp. 1/26/2027), $7.10 (11,419, exp. 1/22/2028), $14.91 (13,369, exp. 1/22/2029); 10-year vesting schedule |
| RSUs/PSUs unvested (selected) | RSUs: 11,182 (2/3/2020, 10-yr), 6,032 (1/25/2021, 5-yr), 7,114 (1/25/2022, 4-yr), 12,549 (1/25/2023, 4-yr), 13,376 (2/5/2024, 4-yr); PSUs: 100,000 (10/4/2021) |
| 2024 equity vest/exercise activity | Options exercised: 86,135 shares ($3,768,162 realized); Stock vested: 12,619 shares ($518,131 realized) |
Employment Terms
| Clause | CEO Agreement Terms |
|---|---|
| Agreement type/term | Second Amended and Restated Employment Agreement effective 10/4/2021; initial 5-year term with successive 1-year auto-renewals unless 90-days' notice of non-renewal |
| Role and base salary | CEO of Company and Bank; minimum annual base salary retroactive to 1/1/2021 of $700,000, subject to annual review; eligible for annual cash bonus, equity incentives, car allowance, country club dues reimbursement |
| Severance (without cause/good reason) | Accrued benefits; 2x current base salary (monthly installments unless CIC), pro-rata annual cash bonus, up to 12 months health coverage, vesting of awards that would have vested within 2 years; full vesting of awards under 2018 Amended Employment Agreement |
| CIC (double trigger) | If qualifying termination within 2 years post-CIC: accrued benefits; lump sum 3x (current base salary + prior-year cash bonus); 36 months health coverage; full vest of outstanding awards except as explicitly provided |
| Disability | Accrued benefits; lump sum 2x base salary (offset by LTD); 24 months health coverage; vesting of awards that would have vested within 2 years |
| Restrictive covenants | Non-compete 1 year; non-solicit 18 months post-termination (or on expiration with 12 months salary continuation) |
| Clawback | Company maintains clawback policy compliant with SEC/Nasdaq; recovery applied to Covered Officers for 2023 awards; aggregate $2,873 returned due to restatement impacts on “Gross Loan Growth” metric |
| Estimated Payments (as of 12/31/2024) | Termination Without Cause/Good Reason | Qualifying Termination with CIC | Death | Disability |
|---|---|---|---|---|
| Eric M. Sprink Total Value | $6,652,083 | $10,287,418 | — | $6,202,655 |
Board Governance
- Board leadership: roles are separated; Sprink is CEO (not Chair); Chair is Christopher D. Adams, which the Board views as better oversight and reduced conflict from combined roles .
- Independence: All directors except Sprink (CEO), Brian T. Hamilton (President CCBX), and Chris Adams (related law firm partner) are independent under Nasdaq; committees are fully independent .
- Committees: Audit, Compensation, Governance & Nominating; Sprink is not listed on any committee .
- Meetings/attendance: Board held 11 regular meetings in 2024; no director attended fewer than 75% of Board and key committee meetings; Audit committee met 15 times, Compensation 3, Governance 1 .
Director Compensation
- As an employee-director, Sprink received no director fees; non-employee director cash retainers and restricted stock grants are detailed, but exclude the CEO .
Compensation Peer Group (Benchmarking)
- Two peer sets: Bank Peers (public banks by business lines/asset size) and BaaS Peers (BaaS-focused institutions) used to inform pay design and competitiveness; committee does not target a fixed percentile .
- Bank Peers include institutions such as Nicolet Bankshares (NIC), German American Bancorp (GABC), Bridgewater Bancshares (BWB), etc.; BaaS peers include The Bancorp (TBBK), Pathward (CASH), Triumph (TFIN), Green Dot (GDOT), etc. .
Say-on-Pay & Shareholder Feedback
- 2024 Say-on-Pay approval ~99% of votes cast; committee considers shareholder feedback in compensation design .
Related Party Transactions and Policies
- Related persons transactions subject to Board approval with arm’s-length standards; legal services with Adams & Duncan (Director partner) totaled $971,000 in 2024 .
- Ordinary banking relationships with directors/officers are on comparable terms; as of 12/31/2024, $12.6 million loans outstanding and $3.9 million deposits from related parties; none classified as problem loans .
Risk Indicators & Red Flags
- Restatement in 2025 10-K corrected BaaS loan accounting; clawback applied with Covered Officers repaying $2,873 aggregate; plan prohibits option repricing without shareholder approval .
- Hedging prohibited; pledging restricted; no pledged shares indicated for Sprink, supporting alignment .
- Section 16(a) compliance: one late Form 4 for Sprink covering a single sale transaction; one late Form 4 for Hamilton covering grants .
Investment Implications
- Pay-for-performance alignment: CEO’s long-dated 100,000 PSUs cliff-vesting in 2027 with price hurdles and top-decile ROAE requirement ties value creation to TSR and profitability; this can support long-term stock performance but concentrates realized pay on meeting strict hurdles .
- Vesting and selling pressure: 2024 activity shows sizable option exercise (86,135 shares, $3.77M value realized) and RSU vesting (12,619 shares); periodic vesting of 4-year RSUs may create ongoing liquidity events, though hedging is prohibited and pledging constrained .
- Retention and CIC economics: Double-trigger CIC at 3x salary+prior bonus with full vesting implies significant change-in-control cost ($10.29M estimated), encouraging continuity but increasing potential transaction costs; non-compete/non-solicit may mitigate post-departure risk .
- Governance quality: Separation of Chair/CEO and independent committees reduce dual-role concerns; strong 99% say-on-pay support reflects investor approval of compensation alignment and design choices .
- Dilution considerations: Proposed 2018 Plan Second Amendment adds 600,000 shares to authorized pool; assess dilution/overhang versus talent retention benefits as part of equity capital allocation .
Clawback enforcement history (2023 awards): $2,873 aggregate recaptured due to restatement impacts on Gross Loan Growth metric across Covered Officers, demonstrating active recovery policy application **[1437958_0001437958-25-000076_ck1437958-20250414.htm:12]**.