Alan Arizumi
FIRST HAWAIIANAbout Alan Arizumi
Alan H. Arizumi, age 65, is Vice Chairman, Wealth Management Group at First Hawaiian, Inc. (FHB), leading Personal Trust, Private Banking, Wealth Advisory, Institutional Advisory Services, Investment Services, Trust Compliance, the Wealth Management Service Center, and Bishop Street Capital Management Corp. He has served on the Bank’s Senior Management Committee since December 2009; he previously oversaw the Consumer Banking Group (2014–2017). He holds a BBA from the University of Hawaii and is a graduate of Pacific Coast Banking School . Company performance relevant to incentive alignment in 2024: cumulative TSR value of initial $100 was $112.76 vs $130.90 for KBW Regional Bank Index peers, Net Income was $230 million, and Core ROATE was 16.2% . The 2024 annual incentive plan weighted 50% Core Net Income, 20% Asset Quality, 30% individual performance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| First Hawaiian Bank | Vice Chairman, Wealth Management Group | 2013–present | Oversees all Wealth Management businesses; Senior Management Committee member since Dec 2009; previously oversaw Consumer Banking Group (2014–2017) and chaired Bishop Street Capital Management Corp. (2013–2017) . |
| Bishop Street Capital Management Corp. (FHB subsidiary) | Chairman & CEO | 2013–2017 | Led asset management subsidiary strategy and execution . |
| First Hawaiian Bank | EVP, Business, Dealer and Card Services Group | 2010–2013 | Led growth and risk management for business/dealer/card segments . |
| First Hawaiian Bank | EVP & Chief Risk Officer, Risk Management Group | 2009–2010 | Enterprise risk oversight as CRO . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Hawaii Community Foundation | Board Member and Treasurer | n/d (current) | Community philanthropy and stewardship . |
| McKinley High School Foundation | Board Member | n/d (current) | Education-focused community support . |
| KCAA Preschools of Hawaii | Board Member | n/d (current) | Early childhood education support . |
| Oahu Economic Development Board | Special Advisor | n/d (current) | Economic development advisory . |
Fixed Compensation
Multi-year summary (reported compensation):
| Year | Base Salary ($) | Actual Cash Bonus ($) | Stock Awards ($, grant-date FV) | All Other Compensation ($) | Total ($) |
|---|---|---|---|---|---|
| 2024 | 540,520 | 534,927 | 299,998 | 116,656 | 1,492,101 |
| 2023 | 535,274 | 244,738 | 299,985 | 145,346 | 1,225,343 |
2024 annual bonus structure and outcome (Alan-specific):
| Metric | Weight | Target | Actual | Payout Factor |
|---|---|---|---|---|
| Core Net Income | 50% | 100% | n/a disclosed | 150% |
| Asset Quality Metric | 20% | 100% | n/a disclosed | 150% |
| Individual Performance | 30% | 100% | n/a disclosed | 150% |
| Total Award as % of Target | 100% | — | — | 150% |
Notes: In 2024, Alan’s target bonus opportunity equaled $356,618 (65% of salary); actual award paid was $534,927 (150% of target) .
Performance Compensation
2024 long-term incentive (LTI) award grants:
| Grant Date | Vehicle | Units | Vesting | Grant-Date Fair Value ($) |
|---|---|---|---|---|
| 2/28/2024 | Performance Share Units (2024–2026 LTIP) | 8,654 | Cliff vest within 60 days after 12/31/2026, 0–200% of target, subject to performance and service | 180,003 |
| 2/28/2024 | Restricted Stock Units | 5,769 | 1/3 on 2/28/2025, 1/3 on 2/28/2026, 1/3 on 2/28/2027, subject to service | 119,995 |
2024–2026 LTIP performance mechanics:
- 70% ROATE vs compensation peer group; 30% ROATA vs compensation peer group; TSR vs KBW Regional Bank Index as +/-25% modifier (no upward if absolute TSR negative); 0–200% payout .
2022–2024 LTIP results and earned shares:
| Performance Measure | Weight | Actual Result | Award Earned (% of Target) |
|---|---|---|---|
| ROATE (relative) | 70% | 83rd percentile; 54.45% metric result (company-defined) | 140% |
| ROATA (relative) | 30% | 39th percentile; 3.27% metric result (company-defined) | 21.7% |
| TSR Modifier (relative) | Modifier | 32nd percentile; FHI TSR 5.05% | 77.39% modifier; total payout 125.1% |
| Alan H. Arizumi—PSUs Earned | — | — | 7,224 shares |
2024 stock vested (realized):
| Shares Vested (#) | Value Realized ($) |
|---|---|
| 11,760 | 249,427 |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (2/27/2025) | 68,667 shares; <1% of class (126,195,936 shares outstanding) . |
| Stock Ownership Guidelines | Other NEOs: 2x base salary; 5-year compliance window . |
| Compliance Status | All directors and officers subject to the policy are in compliance or within their window . |
| What Counts Toward Guidelines (Officers) | Outright shares, deferred shares/units, ESPP, retirement-account shares, unvested RSUs, earned-but-unvested PSUs; excludes unearned PSUs and options . |
| Hedging/Pledging Policy | Pledging and hedging of Company stock are prohibited (including margin unless non-marginable); short-term/speculative transactions banned . |
Outstanding equity awards at FY 2024 year-end (Alan):
| Type | Units/Status | Market Value ($) at $25.95 |
|---|---|---|
| RSUs—vest 2/23/2025 | 1,284 (2) | 33,320 |
| PSUs (2022–2024)—earned | 7,224; vest within 60 days after 12/31/2024 (3) | 187,463 |
| RSUs—vest 2/22/2025 and 2/22/2026 (two tranches) | 2,994 (4) | 77,694 |
| PSUs (2023–2025)—unearned (shown at max) | 13,472 (5) | 349,598 |
| RSUs—vest 2/28/2025/2026/2027 (three tranches) | 5,769 (6) | 149,706 |
| PSUs (2024–2026)—unearned (shown at max) | 17,308 (7) | 449,143 |
Vesting/settlement cadence (near-term supply considerations):
- RSUs vested Feb 23, 2025 (990 shares including spousal beneficial), Feb 22, 2025 (1,148 incl. spousal beneficial), and Feb 28, 2025 (1,488 incl. spousal beneficial); shares delivered within 30 days; amounts reported net of shares withheld for taxes .
Employment Terms
Executive Severance Plan (applies to all NEOs; double-trigger following change in control):
- CIC within 2 years: cash severance 2x highest salary + 2x average of last two annual bonuses; 1 year of health benefits; outplacement . Double-trigger equity vesting applies (PSUs at greater of target or actual as of CIC; RSUs vest) .
- Outside CIC window: cash severance 1x highest salary + 1x average of last two annual bonuses .
Potential payments for Alan H. Arizumi (as of 12/31/2024; stock at $25.95):
| Scenario | Cash Severance ($) | Health/Welfare ($) | Stock Awards ($) | Outplacement ($) | Total ($) |
|---|---|---|---|---|---|
| Termination in connection with CIC | 1,860,705 | 9,618 | 1,246,906 | 20,000 | 3,137,229 |
| Termination without Cause / Good Reason | 930,353 | — | — | — | 930,353 |
| Retirement | — | — | 779,256 | — | 779,256 |
| Death or Disability | — | — | 639,555 | — | 639,555 |
Additional terms:
- Restrictive covenants (non-compete, non-solicit, confidentiality, non-disparagement) apply during employment and for 1 year post-termination for Severance Plan participants .
- Clawback policies: A&R Clawback Policy (broader discretion) and Mandatory Clawback Policy (Dodd-Frank 954) apply to cash and equity incentives; awards under the 2025 Equity Plan are subject to recoupment .
- Options are not granted historically; no timing policy for options (and none planned) .
- FDIC golden parachute limits acknowledged in plan documentation .
Deferred Compensation (alignment and retention):
| Item | Alan Arizumi |
|---|---|
| 2024 Registrant Contributions ($) | 59,369 |
| 2024 Aggregate Earnings ($) | 173,355 |
| 12/31/2024 Aggregate Balance ($) | 3,401,761 |
| Participation | First Hawaiian, Inc. DCP (retirement contribution); First Hawaiian Bank DCP participation noted for peers; SERP frozen and CEO-only . |
Performance & Track Record
- 2024 leadership highlights for Arizumi: delivered record-breaking financial impact; advanced succession strategy and leadership development; operational excellence via efficiencies and data-driven decisions; cultural transformation; executed transformational strategy exceeding core objectives .
- Company 2024 performance context: Net Income $230 million; Core ROATE 16.2%; TSR value of initial $100 at $112.76 vs $130.90 for KBW Regional Bank Index peers .
- Annual incentive metrics and outcomes were formulaic; no discretionary adjustments by Committee in 2024 .
Compensation Committee Analysis
- Independent consultant: Pearl Meyer retained Sep 2024 to review peer group, conduct market assessment, and advise on 2025 incentives; Committee does not target a precise percentile, considering market data alongside internal equity and individual performance .
- 2024 compensation peer group included: Atlantic Union Bankshares; Fulton Financial; Bank of Hawaii; BankUnited; Banner; Cathay General; Columbia Banking System; Commerce Bancshares; CVB Financial; F.N.B.; Hope Bancorp; Pacific Premier; PacWest; Prosperity Bancshares; Trustmark; UMB Financial; United Bankshares; WaFd; Wintrust .
- Governance features: double-trigger CIC, robust ownership guidelines (NEOs 2x salary), clawbacks, prohibition on hedging/pledging, no gross-ups for excise taxes .
Say-on-Pay & Shareholder Feedback
| Item | Result |
|---|---|
| 2025 Say-on-Pay advisory vote | For: 114,792,637; Against: 1,198,098; Abstain: 79,080; Broker non-votes: 2,694,161 . |
| 2025 Approval of 2025 Omnibus Equity Plan | For: 110,705,962; Against: 5,293,324; Abstain: 70,529; Broker non-votes: 2,694,161 . |
Risk Indicators & Red Flags
- Prohibitions on pledging/hedging and speculative trading reduce misalignment risks .
- No option repricing/reloads and no single-trigger equity vesting; no excise tax gross-ups; minimum vesting rules for 2025 Equity Plan; no dividends on unearned awards .
- Related-party transaction policy in place; ordinary-course banking transactions only on market terms; Section 16(a) compliance confirmed for 2024 .
Investment Implications
- Pay-for-performance alignment looks solid: 2024 bonus paid at 150% of target driven by formulaic Core Net Income and Asset Quality metrics and 150% individual performance factor; LTIP is majority performance-based with ROATE/ROATA and relative TSR modifier; 2022–2024 LTIP paid at 125.1% with 7,224 PSUs earned for Arizumi .
- Retention considerations are balanced: double-trigger CIC and one-year restrictive covenants, with outside-CIC severance at 1x salary+bonus; 2024 DCP balance of $3.40 million and ongoing RSU/PSU vesting support retention .
- Potential insider selling pressure near February windows: multiple RSU and PSU vestings settle within 30 days of February vest dates; deliveries are net of tax withholding, but recurring February liquidity could be a technical overhang .
- Governance signals are favorable: strong say-on-pay support (114.79M For vs 1.20M Against), prohibition on pledging/hedging, clawback coverage across cash and equity, and no options granted historically .