Reginald E. Davis
Senior Executive Vice President and President of Consumer and Small Business Banking at FLAGSTAR BANK, NATIONAL ASSOCIATION
Executive
About Reginald E. Davis
Senior Executive Vice President and President of Consumer and Small Business Banking at Flagstar Financial, Inc. (FLG). Age 62 as of the April 7, 2025 record date; joined Flagstar on December 1, 2022 after leading the same function at Flagstar Bank F.S.B. since April 2020 . He oversees all non-mortgage lending, Government Banking, Treasury Management, strategic alliances, and Retail Banking . 2024 was a turnaround year for FLG with a reported net loss of $1,118 million as management executed capital raises, de-risking and liquidity actions, including a $1.05B capital raise and CRE portfolio reduction; CET1 improved to 11.83% and liquidity ended 2024 at $29.9B .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| SunTrust (now Truist) | Head of Business Banking | — | Led business banking nationally |
| RBC Bank USA | President | — | Ran U.S. banking division of Royal Bank of Canada |
| Wachovia (now Wells Fargo) | Senior executive; Operating Committee member | — | Held multiple senior roles across the franchise |
| First Union Bank | Early career | — | Began banking career |
External Roles
| Organization | Role | Years |
|---|---|---|
| Lincoln Financial Group | Director (current) | — |
| 100 Black Men of Atlanta | Member (current) | — |
| Flagstar Bank Foundation | Director (current) | — |
| Morehouse College | Past Chair, Dean’s Advisory Board | — |
| Atlanta Chamber of Commerce | Past Board Member | — |
Fixed Compensation
| Component | 2024 Details |
|---|---|
| Base Salary (rate) | $700,000; reduced from $750,000 as part of 2024 program reset |
| Target Bonus % | 100% of base salary |
| Target Bonus ($) | $700,000 |
| Actual Bonus Paid (AIP) | $700,000 (100% of target) |
Performance Compensation
Annual Incentive Plan (AIP) – 2024
| Metric Category | Weighting | Target | Actual | Payout |
|---|---|---|---|---|
| Compliance, Risk Management and Controls | Not disclosed | Stabilization and controls build | Met/exceeded targets (risk governance, staffing, portfolio review) | 100% of target |
| Talent, Leadership and Culture | Not disclosed | Team build, communication | Met/exceeded targets (hiring, systems integration, comms) | 100% of target |
| Strategy, Technology and Innovation | Not disclosed | Strategic plan execution | Met/exceeded targets (asset sales, tech/cyber foundations) | 100% of target |
| Financial | Not disclosed | Budget/expense/liquidity/capital | Progress acknowledged; constrained by 2024 results | 100% of target (committee-limited) |
Equity Grants – 2024 Awards Relevant to Davis
| Grant Type | Grant Date | Shares/Units | Exercise/Strike | Grant Date Fair Value ($) | Vesting | Expiration |
|---|---|---|---|---|---|---|
| Stock Options | Jul 24, 2024 | 1,000,000 | $10.94 | $4,560,000 | Equal annual installments over 3 years | Jul 24, 2031 |
Quote-on practice and context (for reference to broader structure in 2024): FLG emphasized special, one-time option grants as the principal long-term incentive for top executives during the turnaround year; for Davis the target bonus remained 100% of salary and the AIP paid at target .
Multi-Year Compensation (Summary)
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | 41,154 | 709,615 | 707,308 |
| Stock Awards ($) | 1,900,005 | 720,000 | — |
| Stock Options ($) | — | — | 4,560,000 |
| Non-Equity Incentive ($) | — | — | 700,000 |
| All Other Compensation ($) | — | 366,144 | 80,010 |
| Total Compensation ($) | 1,941,159 | 1,795,759 | 6,047,318 |
Equity Ownership & Alignment
| Item | Amount/Status |
|---|---|
| Total Beneficial Ownership | 83,261 shares; 0.020% of class (as of Apr 7, 2025) |
| Directly Held Shares | 27,940 |
| Unvested Restricted Stock Awards | 44,478 |
| RSUs vesting within 60 days | 10,843 |
| Options Outstanding (Exercisable/Unexercisable) | 0 / 1,000,000; strike $10.94; expires 7/24/31 |
| Stock Awards Not Vested (12/31/24) | 75,879 shares; $694,293 market value at $9.33 |
| Stock Ownership Guidelines | 4x base salary for senior execs; policy prohibits hedging/pledging |
| Guideline Compliance | NEOs in compliance or within five-year period |
Stock award vesting activity in 2024: 29,450 shares vested; value realized $323,466 .
Note on selling pressure: Davis’ 1,000,000 options had a $10.94 strike; FLG closed at $9.33 on 12/31/2024, implying options were out-of-the-money at year-end 2024 .
Employment Terms
| Scenario | Cash Severance | Equity | Health/Benefits | Total (as of 12/31/24) |
|---|---|---|---|---|
| Death | — | $707,951 accelerated vesting | — | $707,951 |
| Disability | — | $707,951 accelerated vesting | — | $707,951 |
| Involuntary (without cause) / Good Reason (pre-CIC) | $1,400,000 (1x salary+target bonus) | $707,951 accelerated | $16,667 est. benefits | $2,124,618 |
| Involuntary (without cause) / Good Reason (within CIC window) | $2,800,000 (2x salary+target bonus) | $707,951 accelerated | $16,667 est. benefits | $3,524,618 |
Additional terms:
- Agreements feature double-trigger CIC benefits; “best net benefit” approach to 280G, no excise tax gross-up .
- Non-compete and non-solicit for one year post-termination; confidentiality ongoing .
Governance, Clawbacks, and Policies
- Incentive Compensation Recoupment Policy aligned with NYSE/SEC rules; mandatory recovery upon restatement; additional misconduct-based recovery policy; hedging and pledging prohibited .
- Insider Stock Ownership Policy: 4x base salary for senior executives; monitored by the Compensation Committee .
Compensation Peer Group (for benchmarking, 2024 cycle)
- Citizens Financial Group; Comerica; Fifth Third; First Citizens; First Horizon; Huntington; KeyCorp; M&T; Regions; Synovus; Valley National; Webster; Western Alliance; Zions .
Say-on-Pay & Shareholder Feedback
- 2025 Say-on-Pay results: For 260,494,962; Against 32,107,185; Abstain 1,355,787; 68,918,853 broker non-votes .
- Ongoing shareholder outreach and engagement with 169 investors from 90 institutions in 2024 .
Compensation Structure Analysis
- Shift to options-heavy LTI in 2024: One-time, three-year option grant of 1,000,000 options aligns upside to longer-term recovery; replaces prior RSU-centric mix (2023 stock awards $720k vs. 2024 options $4.56m) .
- Increased at-risk pay: 2024 AIP paid 100% of target ($700k) while base was reset to $700k, heightening performance leverage and alignment with turnaround goals .
- Risk controls: Double-trigger CIC, clawbacks, anti-hedge/pledge, and ownership guidelines mitigate misalignment and excessive risk-taking .
Risk Indicators & Red Flags
- Options out-of-the-money at 12/31/24 ($9.33 vs. $10.94 strike) reduce near-term exercise/sale pressure .
- Limited perquisites; no excise tax gross-ups; some relocation gross-ups were provided to certain NEOs (not to Davis in 2024) .
- Company-level CFO turnover in 2024 (Pinto ended CFO role April 12, 2024; Gifford later transitioned to advisor), though not specific to Davis .
Investment Implications
- Alignment: Davis’ large, three-year option grant (1,000,000 shares) and 4x-salary ownership guideline tightly align incentives to long-term equity value creation; anti-pledging and clawbacks further strengthen alignment .
- Retention: One-year non-compete/non-solicit and meaningful CIC protection (2x salary+target bonus; equity acceleration) reduce flight risk during the turnaround .
- Trading signals: With options OTM at 2024 year-end and no option exercises by NEOs in 2024, near-term insider selling pressure appears muted; monitor future Form 4s post-vesting tranches and share price relative to $10.94 strike .
- Execution: 2024 scorecard achieved at target amid de-risking, capital/liquidity actions and tech/operational investments, suggesting operational progress in Davis’ remit despite headline net loss; continued delivery on retail/small business banking growth and risk initiatives will be key to future payouts and equity value .