David S. Morimoto
About David S. Morimoto
David S. Morimoto is Vice Chairman and Chief Operating Officer at Central Pacific Financial Corp. (CPF) since March 1, 2025; he previously served as Senior EVP & CFO (Jan 2022–Feb 2025) and EVP & CFO (Jul 2015–Dec 2021). He has 32+ years of banking experience, began at CPF in 1991, and is an executive officer since 2015; age 57; BBA in Finance (UH Manoa) and MBA in Accounting (Chaminade) . CPF links executive pay to Net Income, Efficiency Ratio, Business/Personal goals in AIP and ROE/rTSR in PSUs; the 2022–2024 PSU cycle paid 96.03% of target, with rTSR at the 56th percentile and ROA at 0.84% relative to targets, evidencing pay-for-performance alignment . CPF’s pay-versus-performance disclosure highlights compensation actually paid tracking stock price/TSR, net income and ROE over 2020–2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Central Pacific Financial Corp. / Central Pacific Bank | Vice Chairman & Chief Operating Officer | 3/2025–present | Oversees Commercial, Retail, Wealth, Real Estate, Digital, driving operational execution across business lines |
| Central Pacific Financial Corp. / Central Pacific Bank | Senior EVP & CFO | 1/2022–2/2025 | Led finance and investor/regulator engagement during rate/credit cycles |
| Central Pacific Financial Corp. / Central Pacific Bank | EVP & CFO | 7/2015–12/2021 | Asset/liability and investment portfolio management; institutional investor and regulator engagement |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Institute for Human Services | Board President & Director | Not disclosed | Community leadership; reputational capital |
| Downtown Athletic Club of Hawaii | Treasurer & Director | Not disclosed | Financial stewardship; network access |
| Hawaii Asia Pacific Association Leaders | Director | Not disclosed | Regional business connectivity |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $448,077 | $488,462 | $497,115 |
| All Other Compensation ($) | $33,454 | $40,454 | $42,428 |
| Total Compensation ($) | $1,237,329 | $1,146,805 | $1,368,077 |
| Notes | Pension plan terminated; DB lump sum paid May 2022 (no increase reported for 2022) | — | — |
Performance Compensation
| Component | 2024 Design | Target | Actual | Payout | Vesting/Payment |
|---|---|---|---|---|---|
| Annual Incentive Plan (AIP) – Net Income (50% weight) | Funding based on adjusted Net Income; payout scales 50% at threshold to 200% at 120% of budget | $63,904,000 | $63,424,000 (99% of target; 98% payout for this portion) | 98% → 49% weighted | Paid Jan 2025; Morimoto received $352,500 vs $375,000 target (94%) |
| AIP – Efficiency Ratio (20%) | Payout scales 50% at threshold (+4% of target) to 200% at -4% of target | 62.69% | 65.10% (+3.84% vs target; 52% payout for this portion) | 52% → 10% weighted | Included in final award above |
| AIP – Business Plan/Personal Goals (30%) | Committee-assessed; capped at 200% | Meets Expectations | Exceeds Expectations; avg ~115% for NEOs | 117% for CEO; NEOs avg 115% → ~35% weighted | |
| AIP Final Pool Outcome | Weighted metrics + committee review | — | Adjustments added $10.01mm to GAAP Net Income to remove securities loss and strategic assessment expense, also improved Efficiency Ratio; without adjustments payout would have been 59% | 94% of target overall | Morimoto: Base $500,000; Target 75% ($375,000); Paid $352,500 (94%) |
| Long-Term Incentive (LTI) – 2024 PSU (ROE) 25% of grant | 3-year average ROE vs target; 0% below 80%, 50% at 80%, 100% at 100%, 200% at 120%+; TSR governor applies to rTSR only | Target shares at grant | Trending below threshold for ROE PSUs (disclosed presentation at threshold) | Earned percentage per grid; ROE trailing at/below threshold | Cliff vest 2/15/2027 if threshold met |
| Long-Term Incentive (LTI) – 2024 PSU (rTSR) 25% of grant | rTSR vs S&P SmallCap 600 Commercial Bank Index; 0% <25th, 50% at 25th, 100% at 50th, 200% at 75th+; TSR governor caps at 100% if absolute TSR negative | Target shares at grant | Trending between target and max (table shows maximum representation) | Earned percentage per grid | Cliff vest 2/15/2027 |
| Long-Term Incentive (LTI) – 2024 RSU 50% of grant | Time-based; equal tranches over 3 years | — | Granted 12,261 RSUs | — | Vests 2/15/2025, 2/15/2026, 2/15/2027 (equal installments) |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 63,270 shares; <1% of class |
| Ownership Breakdown | 54,205 direct; 2,830 joint with spouse; 349 in CPF 401(k); 5,886 held by Central Pacific Bank Foundation where Morimoto is VP, Treasurer, Director |
| Stock Ownership Guidelines | Exec VP & Executive Committee Members: hold 50% of net-after-tax vested shares until ownership equals 1.5x base salary within 5 years; Mr. Morimoto currently meets the requirement |
| Hedging & Pledging | Hedging prohibited; pledging prohibited without prior Legal approval; insider trading blackout policy enforced |
| Options | None outstanding/exercised in 2024 |
Outstanding Equity Awards (as of 12/31/2024)
| Grant Ref | Type | Shares/Units Not Vested | Market Value ($) | Notes |
|---|---|---|---|---|
| 1 | RSU (2/15/2022) | 1,761 | $51,157 | Final tranche vests 2/15/2025 |
| 2 | PSU ROA (2022 cycle) | 2,642 (at target) | $76,750 | Cliff vest 2/15/2025, subject to ROA grid |
| 3 | PSU rTSR (2022 cycle) | 5,282 (at max) | $153,442 | Cliff vest 2/15/2025, rTSR vs peers |
| 6 | RSU (2/15/2023) | 5,165 | $150,043 | Remaining tranches vest 2/15/2025 & 2/15/2026 |
| 7 | PSU ROE (2023 cycle) | 1,937 (at threshold) | $56,270 | Cliff vest 2/15/2026; ROE grid |
| 8 | PSU rTSR (2023 cycle) | 7,746 (at max) | $225,021 | Cliff vest 2/15/2026; rTSR vs peers |
| 9 | RSU (2/15/2024) | 12,261 | $356,182 | Vests 2/15/2025–2027 in equal tranches |
| 10 | PSU ROE (2024 cycle) | 3,066 (at threshold) | $89,067 | Cliff vest 2/15/2027; ROE grid |
| 11 | PSU rTSR (2024 cycle) | 12,260 (at max) | $356,153 | Cliff vest 2/15/2027; rTSR vs peers |
2024 Equity Grant Detail (Grant date 2/15/2024)
| Type | Shares | Grant Date Fair Value ($) | Performance Grid / Vesting |
|---|---|---|---|
| RSU | 12,261 | $237,496 | Time-based; equal tranches over 3 years |
| PSU – ROE | 6,131 target | Valued using $19.37 per share at grant | 0%<80%; 50% at 80%; 100% at 100%; 200% at 120%+; cliff vest 2/15/2027 |
| PSU – rTSR | 6,130 target | $19.54 per target share at grant | 0%<25th; 50% at 25th; 100% at 50th; 200% at 75th+; TSR governor caps at 100% if absolute TSR negative; cliff vest 2/15/2027 |
Employment Terms
| Term | Structure |
|---|---|
| Employment Agreement | None; at-will employment for NEOs |
| Severance Provisions | No special severance arrangements beyond those generally available to all salaried employees |
| Change-in-Control | Double trigger only: vesting accelerates upon change-in-control plus termination without cause or for good reason; PSUs vest at target under acceleration |
| CIC Value (as of 12/31/2024) | $1,292,057 for Morimoto (accelerated vesting value at $29.05 stock price) |
| Clawback | NYSE-compliant clawback policy adopted Sept 21, 2023; recovery for restatements per SEC/Dodd-Frank; AIP/LTI also include recovery provisions |
| Deferred Compensation | 2024 deferral $99,423; aggregate account balance $553,921; plan has no employer match, payouts per election post-separation |
| Tax Gross-ups | None provided (280G/409A gross-ups not provided) |
Compensation Structure Analysis
- 2024 pay mix balances cash AIP and 50/50 RSU/PSU LTI; PSUs split between ROE and rTSR with capped upside and TSR governor, aligning with shareholder returns while maintaining financial discipline .
- AIP adjustments moved payout from 59% to 94% of target by excluding securities loss and one-time strategic assessment expenses, reflecting committee view of core performance but introducing discretion risk if recurring adjustments emerge .
- No options used; program relies on RSUs/PSUs, reducing leverage but increasing certainty of equity value and potential selling pressure at vesting .
- Strong say-on-pay support (98%) and independent Compensation Committee with external advisors mitigates pay inflation risk; peer benchmarking considers regional talent market constraints in Hawaii .
Equity Ownership & Alignment Details
| Item | Detail |
|---|---|
| Ownership as % of Outstanding | Less than 1% (asterisk notation) |
| Vested vs Unvested | Unvested RSUs/PSUs detailed above; none exercisable options |
| Stock Ownership Guidelines Compliance | Meets guideline; EVP/Executive Committee multiple 1.5x salary; mechanisms require retaining 50% of net-after-tax vested shares until multiple met; post-deadline, 100% holding until met |
| Pledging/Hedging | Prohibited hedging; pledging requires Legal approval; no pledges disclosed in beneficial ownership footnotes |
Performance & Track Record
- 2022–2024 PSU cycle payout at 96.03% of target driven by ROA actual 0.84% vs 0.96% target (67.88% payout for ROA) and rTSR at 56th percentile (124.17% payout for rTSR) .
- 2024 AIP pool funded at 94% of target after adjustments; Net Income 99% of target; Efficiency Ratio +3.84% worse than target; Business/Personal goals averaged ~115% for NEOs .
Governance and Committee Context
- Compensation Committee: independent directors Saedene K. Ota (Chair), Jason R. Fujimoto, Crystal K. Rose; strong governance practices and independent advisors .
- Say-on-pay approval ~98% in 2024; clawback policy adopted to comply with NYSE/SEC rules .
Investment Implications
- Near-term insider supply risk around RSU and PSU vest dates: Feb 15, 2025, 2026, 2027 for RSUs; PSU cliffs on Feb 15, 2025 (2022 cycle), Feb 15, 2026 (2023 cycle), and Feb 15, 2027 (2024 cycle); Morimoto’s 2024 RSUs total 12,261 vest in equal tranches, and PSUs show rTSR trending toward upper payouts, potentially increasing share issuance at vesting .
- Alignment is credible: guideline compliance, balanced ROE/rTSR PSUs with governor, and double-trigger CIC reduce windfall risk, while beneficial ownership remains modest (<1%), placing emphasis on ongoing LTI awards to maintain alignment .
- 2024 AIP adjustments improved payouts; monitor future use of “core” adjustments to ensure consistency with shareholder interests; absent adjustments, payout would have been materially lower (59%) .
- Transition to COO increases operational accountability; equity incentives tied to ROE and rTSR suggest sensitivity to execution on profitability and competitive standing versus small-cap commercial bank peers .