Allen Nicholson
CVB FINANCIALAbout Allen Nicholson
E. Allen Nicholson is Executive Vice President and Chief Financial Officer of CVB Financial Corp. and Citizens Business Bank; he has served as CFO since May 4, 2016 and is age 57 as disclosed in the company’s 2024 Form 10‑K executive officer section . Company performance under the executive team included 2024 net income of $200.7 million and a CET1 ratio of 16.2% as of year-end 2024 , with one-, three-, and five-year annualized shareholder returns of 12%, 4%, and 4% through 12/31/2024 . The proxy highlights Nicholson’s role in liquidity and interest rate risk management, portfolio restructuring, and cost discipline in 2024, which drove his incentive outcomes (see Performance Compensation) .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Pacific Premier Bank / Pacific Premier Bancorp, Inc. | EVP & Chief Financial Officer | 2015–2016 | Public-company CFO experience and capital markets readiness |
| 1st Enterprise Bank | Chief Financial Officer | 2008–2014 | Built finance function at a growth-oriented business bank |
| Mellon First Business Bank | Chief Financial Officer | 2005–2008 | Finance leadership at specialty business bank |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| — | — | — | None disclosed in company filings reviewed |
Fixed Compensation
Multi-year compensation (SEC Summary Compensation Table):
| Metric (USD) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | $498,396 | $519,231 | $535,385 |
| Bonus (see note) | $90,000 | $194,000 | $117,920 |
| Non-Equity Executive Incentive Plan Compensation | $260,000 | $52,000 | $107,200 |
| Stock Awards (grant-date fair value) | $516,810 | $499,994 | $520,014 |
| All Other Compensation | $49,713 | $48,654 | $48,425 |
| Total | $1,414,919 | $1,313,879 | $1,328,943 |
Notes and structure:
- Target annual incentive ranges in Nicholson’s 2024 NEO Employment Agreement: metrics-based incentive 0%–60% of base salary; discretionary bonus 0%–20% of base salary .
- 2024 actuals: metrics-based incentive $117,920 and plan-based discretionary bonus $107,200 (20% of base), for total cash incentive $225,120 (42% of base). The proxy’s narrative ties these to performance outcomes summarized below .
Performance Compensation
Annual plan design and 2024 outcomes for CFO:
- Plan structure: two components under the Executive Performance Compensation Plan (ECP) — (1) metrics-based incentive (five financial/operational KPIs) and (2) plan-based discretionary bonus for individual performance (0%–20% of base) .
- 2024 outcomes: Level 1 benchmark achieved on three metrics, Level 3 on one metric, below Level 1 on one metric; metrics-based payout $117,920; discretionary bonus awarded at 20% of base ($107,200) for contributions to liquidity/IRR management, portfolio actions, investor engagement, and cost control .
| Component | Metric categories | Weighting | Target | Actual result | Payout (USD) | Vesting |
|---|---|---|---|---|---|---|
| Metrics-based incentive | Net profit; loans/deposits; noninterest income; operating expense; (credit/delinquency metrics as appropriate) | Not disclosed | Not disclosed | 3 metrics at Level 1; 1 at Level 3; 1 below threshold | $117,920 | Cash (annual) |
| Discretionary bonus | Individual performance (CFO-specific objectives) | Max 20% of base | 0%–20% | Judged “Excellent” vs CFO objectives in 2024 narrative | $107,200 | Cash (annual) |
Pay governance:
- Clawback: Nasdaq-compliant clawback policy adopted; included as an exhibit to the 2024 Form 10‑K .
- No known Rule 10b5‑1 plans in effect for directors or Section 16 officers during the period; no known outstanding hedged or pledged positions; hedging and pledging generally prohibited without pre-clearance under the Insider Trading Policy .
Equity Ownership & Alignment
- Beneficial ownership: 120,211 shares (includes 6,000 options exercisable within 60 days); ~0.1% of outstanding shares as of record date (3/28/2025) .
- Ownership policy and pledging/hedging: Insider Trading Policy restricts hedging/pledging, with preclearance; company reports no known pledging/hedging or active 10b5‑1 plans for Restricted Persons as of the proxy date .
Breakdown of outstanding awards at 12/31/2024:
| Instrument | Quantity | Key terms | Status/Value |
|---|---|---|---|
| Stock option | 6,000 | Exercise price $16.62; expires 6/22/2026 | Exercisable; — |
| Time RSUs | 13,699 | Vest 1/24/2025, 1/24/2026, 1/24/2027 (one-third annually) | $293,296 market value at $21.41 |
| Time RSUs | 6,893 | Vest 1/25/2025 and 1/25/2026 (one-half annually) | $147,579 market value |
| Time RSUs | 3,834 | Vest 1/26/2025 (cliff) | $82,086 market value |
| PRSUs (2024 grant; target) | 13,699 | 3-year period FY2024–FY2026; vests 1/24/2027 based on performance | $293,296 at target |
| PRSUs (2023 grant; maximum) | 10,339 | 3-year period ending 1/25/2026; interim results above target; vests 1/25/2026 | $221,358 at max assumption |
| PRSUs (2022 grant; maximum) | 14,375 | 3-year period 2022–2024; performance above maximum; vests 1/26/2025 | $307,769 at max assumption |
Notes:
- Market values reflect $21.41 closing price on 12/31/2024 per the proxy methodology .
- PRSU 2022 cycle vesting scheduled 1/26/2025 at maximum based on achieved results; 2023 and 2024 cycles subject to outcome at measurement .
Vesting schedule (potential selling/withholding events):
- 1/26/2025: Time RSUs (3,834) vest; 2022 PRSUs (14,375 at max assumption) vest .
- 1/25/2026: Time RSUs (6,893) final tranche; 2023 PRSUs vest (performance-based) .
- 1/24/2027: Time RSUs (remaining) and 2024 PRSUs vest (performance-based) .
Employment Terms
- Agreement: 2024 NEO Employment Agreement (effective July 2, 2024) with a two-year term and successive one-year auto-renewals unless terminated by either party .
- Base salary: Set and adjusted at the discretion of the CEO and Compensation Committee .
- Annual incentives: Metrics-based incentive opportunity of 0%–60% of base salary; separate discretionary bonus opportunity of 0%–20% of base salary .
- Long-term equity: Annual equity awards (RSUs/PRSUs/options) targeted at ~100% of prior-year base salary (not guaranteed), with PRSUs on three-year performance cycles .
- Severance (no cause, outside CoC): Committee discretion to provide or not provide severance; if provided, subject to a release .
- Change-in-control (double trigger or within protected window): Cash severance equal to 2x annual base pay plus 2x average annual bonus for preceding two years, plus a lump-sum equivalent of 24 months of medical/dental COBRA cost; paid over 18 months; equity acceleration (options/Time RSUs vest; PRSUs vest at target if <2 years complete, or based on actual if ≥2 years complete) .
- Death/disability: Equity (options, Time RSUs, PRSUs) vests in full; PRSUs at target .
- Clawback: Nasdaq-compliant clawback policy adopted and on file .
- Insider trading/pledging/hedging: Restricted Persons (including CFO) prohibited from short-swing, hedging, and pledging absent preclearance; no known hedged/pledged positions or active 10b5‑1 plans at the time of the proxy .
Investment Implications
- Alignment and incentives: Nicholson’s 2024 equity grant (~$520k) was roughly comparable to base salary ($535k), and his total cash incentive (42% of base) varied with performance, consistent with pay-for-performance design (0–60% metrics; 0–20% discretionary) . Multi-year PRSU cycles and significant unvested equity tie outcomes to TSR/financial KPIs through 2027, aligning with shareholders .
- Retention risk: Fresh 2024 NEO Employment Agreements, double-trigger CoC protections (2x cash + benefits) and staged RSU/PRSU vesting reduce near-term flight risk; however, severance discretion outside a change-in-control provides less certainty than fixed formulas, modestly elevating non‑CoC separation risk .
- Trading signals/overhang: Upcoming vesting dates (Jan 2025/2026/2027) and tax withholding could create periodic selling pressure; one small legacy option grant (6,000 shares) expires 6/22/2026, but scale is immaterial to float . No known hedging/pledging and no active 10b5‑1 plans reduce technical overhang risk .
- Performance execution: Company TSR (12%/4%/4% for 1/3/5 years) and 2024 profitability ($200.7m) set a context of relative resilience; the Compensation Committee credited Nicholson with key balance sheet and risk actions amid rate and liquidity cross-currents, which supported incentive payouts—continued delivery on NIM, funding mix, and securities repositioning will be critical to future PRSU outcomes and cash incentives .