Neill Char
FIRST HAWAIIANAbout Neill Char
Neill A. Char is Vice Chairman, Retail Banking and Consumer Products Group at First Hawaiian, Inc. (FHB). Age 53, he has led the Retail Banking group since 2021 and has served in executive leadership roles across Commercial Banking, Private Banking, and Wealth Advisory since 2009. His education includes a B.S. in Finance (University of Hawaii at Manoa), graduation from Pacific Coast Banking School, and the Chartered Retirement Planning Counselor credential; he also holds a Hawaii life insurance license . Under his and management’s tenure, FHB reported 2024 net income of $230.1M and diluted EPS of $1.79, with net interest margin at 2.95% and CET1 at 12.80% . Pay-versus-performance disclosures show 2024 TSR translating a $100 initial investment into $112.76 vs. $130.90 for the peer group, and core ROATE of 16.2% for 2024; LTIP metrics emphasize relative ROATE/ROATA with a TSR modifier, aligning pay with profitability and risk-adjusted returns .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| First Hawaiian, Inc./First Hawaiian Bank | Vice Chairman, Retail Banking & Consumer Products Group | 2021–Present | Leads branch network (HI, Guam, Saipan), middle market/real estate, and consumer products; member of Senior Management Committee . |
| First Hawaiian, Inc./First Hawaiian Bank | Executive leadership roles in Commercial Banking, Private Banking, Wealth Advisory | 2009–2021 | Broad leadership across client segments and wealth business . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Rehabilitation Hospital of the Pacific | Director | — | Community healthcare governance engagement . |
| Friends of Hawaii Charities | Director | — | Community/charitable impact . |
Fixed Compensation
Multi-year summary compensation reported for Neill A. Char:
| Metric (USD) | 2023 | 2024 |
|---|---|---|
| Salary | $475,000 | $482,917 |
| Annual Bonus (cash) | $185,250 | $444,044 |
| Stock Awards (grant date fair value) | $299,985 | $299,998 |
| All Other Compensation | $129,450 | $100,518 |
| Total | $1,089,685 | $1,327,477 |
2024 base salary and bonus framework:
- Base salary: $484,500 effective March 2024 .
- Target bonus: 65% of salary; actual payout 141% of target for 2024, equating to $444,044 .
- Perquisites and other benefits in 2024: $100,518 total, including $17,428 perquisites (parking, auto allowance, meals, club dues), $75,987 company contributions to 401(k)/Future Plan/Deferred Compensation, and $7,103 insurance premiums .
Performance Compensation
2024 Annual Bonus Plan design and outcomes (company-wide NEO framework):
| Component | Weight | Targeting/Definition | 2024 Payout Factor |
|---|---|---|---|
| Core Net Income | 50% | Core net income (threshold widened to 90% and max to 110% of target for 2024) | 150% |
| Asset Quality Metric | 20% | Asset quality (internal metric) | 150% |
| Individual Performance | 30% | Role-specific objectives | 120% for Neill Char per NEO range and table (overall 141% for Char) |
Long-Term Incentive Plan (LTIP) structure and grants:
- 2024 LTIP mix: 60% PSUs (2024–2026 cycle), 40% RSUs .
- 2024 PSU metrics/weighting: 70% Relative ROATE vs peer group; 30% Relative ROATA vs peer group; with +/-25% Relative TSR modifier vs KBW index .
- Neill Char 2024 grants: 8,654 PSUs (target) and 5,769 RSUs; total grant-date value $299,998 .
- RSU vesting cadence: 3 equal annual installments on Feb 28, 2025, 2026, 2027 (subject to continued employment) .
Prior-cycle PSU results:
| PSU Cycle | Metric Result | Payout | Neill Char Shares Earned |
|---|---|---|---|
| 2022–2024 | ROATE 83rd percentile (140%); ROATA 39th percentile (21.7%); TSR modifier 77.39% | 125.1% of target | 6,567 |
Options: Company does not grant stock options historically/currently; no option timing policy applicable .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 25,837 shares as of Feb 27, 2025; FHB shares outstanding 126,195,936; ≈0.02% of shares outstanding (25,837/126,195,936) . |
| Stock ownership guidelines (officers) | NEOs: 2x base salary within 5 years; executives are in compliance or within window . |
| Hedging/pledging | Hedging, speculative trading, and pledging prohibited for employees/directors; guidelines also exclude pledged/encumbered shares from counting toward ownership . |
| Clawbacks | Two policies: (i) Amended & Restated Clawback covering cash and equity (incl. time-based awards) for misconduct/risk breaches; (ii) Mandatory Dodd‑Frank clawback for erroneously awarded incentive-based pay to current/former exec officers upon accounting restatements . |
Outstanding awards at 12/31/2024 (market values at $25.95/share):
| Award Type | Units | Market Value |
|---|---|---|
| RSUs (2019–2022 grants still unvested at YE): 1,168 (vested 2/23/2025) | 1,168 | $30,310 |
| RSUs (prior grant) | 2,994 | $77,694 |
| RSUs (2024 grant) | 5,769 | $149,706 |
| PSUs (unearned; likely 2023–2025 cycle) | 13,472 | $349,598 |
| PSUs (unearned; 2024–2026 cycle) | 17,308 | $449,143 |
Employment Terms
Executive Severance Plan (all NEOs, double-trigger upon CIC):
- CIC double-trigger severance: 2x highest salary + 2x average bonus from prior two years; 1 year of health benefits and outplacement; equity vests per change-in-control treatment (PSUs ≥ target or actual; RSUs vest) .
- Non‑CIC qualifying termination: 1x highest salary + 1x average bonus from prior two years .
- Restrictive covenants: non-compete and non-solicit for 1 year post-termination; confidentiality and non‑disparagement .
Scenario payouts for Neill A. Char (assuming 12/31/2024 values at $25.95/share):
| Scenario | Cash Severance | Health & Welfare | Equity (accelerated/vested) | Outplacement | Total |
|---|---|---|---|---|---|
| CIC termination (double-trigger) | $1,595,128 | $21,253 | $1,216,726 | $20,000 | $2,853,107 |
| Termination without cause / good reason (non‑CIC) | $797,564 | — | — | — | $797,564 |
| Retirement | — | — | $724,755 | — | $724,755 |
| Death or Disability | — | — | $609,375 | — | $609,375 |
Deferred Compensation and Other Benefits
- Nonqualified Deferred Compensation (2024): Executive contributions $138,938; Company contributions $50,112; earnings $193,758; year-end balance $1,923,340 (First Hawaiian Bank DCP for Char) .
- Director and officer policies: robust clawbacks; anti-hedging/pledging; double-trigger CIC; no excise tax gross-ups; no option repricing without shareholder approval .
- Ownership guideline counting rules: includes owned, deferred, RSUs, earned-but-unvested PSUs; excludes unearned PSUs and any pledged/encumbered stock .
Performance & Track Record (role-specific highlights)
- 2024 individual performance: delivered solid financial performance; balanced loan/deposit growth with risk management; advanced digital initiatives and leadership development; improved customer experience (as evaluated for bonus) .
- Company performance context: noninterest expenses ~flat at $501M; NIM up 3 bps to 2.95%; CET1 12.80%; $40M buybacks; quarterly dividend maintained at $0.26; announced up to $100M buyback for 2025 .
- LTIP performance (2012–2024 cycle reported): PSUs earned at 125.1% of target; indicates above-target outcomes on relative profitability with TSR drag vs peer benchmark .
Compensation Structure Analysis
- Mix and leverage: Significant pay at risk via annual bonus and PSUs (60% of LTI), aligning with core profitability and risk-adjusted return (ROATE/ROATA) objectives; no stock options reduce leverage/overhang .
- Metric calibration: 2024 widened bonus payout band for Core Net Income (threshold 90%, max 110%) increases likelihood of partial payout while raising bar for max—balanced incentive risk .
- Governance features: Double-trigger CIC; robust clawbacks; prohibition on hedging/pledging; independent compensation consultant (Pay Governance through Sep 2024; Pearl Meyer thereafter) .
- Say-on-pay support: >98% approval in 2024 suggests investor alignment with program design .
Investment Implications
- Alignment and retention: Substantial unvested RSUs and multi-year PSUs (30,780 unearned PSUs + 9,931 RSUs at YE 2024) create strong retention hooks into 2026–2027; ownership guidelines (2x salary) and anti-hedging/pledging strengthen alignment .
- Performance sensitivity: Bonus and LTIP tethered to Core Net Income, asset quality, and relative ROATE/ROATA with TSR modifier—supports quality-of-earnings focus appropriate for a bank balance sheet; 2022–2024 PSU payout above target (125.1%) indicates execution against profitability peers despite TSR lag vs benchmark .
- Downside protection for shareholders: Double-trigger CIC vesting, clawbacks spanning cash/equity, and no excise tax gross-ups mitigate governance risk; absence of options reduces incentive to take excessive risk for option value .
- Trading signals: Known vesting/delivery milestones (e.g., RSU tranches each Feb 28, 2025/2026/2027; PSU cliff post‑12/31/2026) can create predictable liquidity windows; however, anti-hedging/pledging policies and ownership guidelines moderate forced selling risk .