David A. Spector
About David A. Spector
David A. Spector, 62, is Chairman and Chief Executive Officer of PMT and has served on the board since the Trust’s formation in 2009; he became CEO in January 2017 and Chairman and CEO in February 2021. His background includes senior mortgage capital markets roles at Morgan Stanley (co-head of global residential mortgages) and Countrywide, and a B.A. from UCLA. PMT emphasizes pay-for-performance via equity, with 2024 PSU outcomes at 80.1% of target (ROE 8.4%, Relative TSR 33.3%), while 2022 PSUs paid at 110.2% of target; say‑on‑pay support was ~98% in 2022–2024. Board independence is 80%, with an independent Lead Trustee, and the CEO also serves as Chairman with oversight mitigants disclosed.
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| PMT | Chairman & CEO; previously President & CEO (2017); EVP/President/COO (2009–2016) | 2009–present | Led strategy and oversight from formation to scale mortgage REIT operations; deep expertise in portfolio investments, rate/credit risk, pricing/trading/hedging. |
| PennyMac Financial Services, Inc. (PFSI) and affiliates | Various executive positions from founding | 2008–present | Broad PMT-aligned leadership across external Manager and Servicer driving operating execution for PMT. |
| Morgan Stanley | Co‑Head, Global Residential Mortgages (London) | 2006–2008 | Global mortgage capital markets leadership. |
| Countrywide | Senior Managing Director, Secondary Marketing (and other roles) | 1990–2006 | Pricing, trading, hedging, and secondary execution leadership. |
External Roles
- No additional public company directorships for Spector are disclosed in PMT’s 2025 proxy.
Fixed Compensation
| Employer | Year | Base salary ($) | Bonus/NEIP ($) | Notes |
|---|---|---|---|---|
| PMT | 2022–2024 | – | – | PMT pays no salary/bonus to NEOs; equity only under PMT’s 2019 Plan. |
| PFSI (disclosed for context) | 2024 | 1,100,000 | 2,965,086 | PFSI pays Spector; total comp mix ~89% variable for CEO in 2024. |
Performance Compensation
PMT long‑term incentives (design and metrics)
| Component | Weight | Performance period | Target/thresholds | 2024 actual (year 1 of 2024–2026 PSU) | Vesting mechanics |
|---|---|---|---|---|---|
| ROE (Cumulative annualized) | 50% | 3 one‑year periods (2024–2026) | 6% = 50% payout; 8% = 100%; 12% = 200% (linear) | ROE 8.4% → 100% for ROE component | Annual/cumulative test; max 200%; service condition applies. |
| Relative TSR (vs peer group) | 50% | 3 one‑year periods | <20th pct=0%; 20–40th=50%; 40–60th=100%; 60–80th=150%; ≥80th=200% | 33.3% percentile → 50% for TSR component | Annual test versus defined mortgage REIT peers; service condition applies. |
| Overall 2024 PSU payout (for each grant’s 2024 tranche) | 100% | 2024 | – | 80.1% (ROE 100% blended with TSR 50%) | Applies to 2022, 2023, 2024 PSU grants’ 2024 performance tranches; 2022 PSU overall 110.2% for 2022–2024. |
2024 PMT equity grants to Spector (grant date 3/12/2024)
| Award type | Shares/target | Grant date fair value ($) | Vesting |
|---|---|---|---|
| RSU | 31,337 | 449,999 | Ratable over 3 years; dividend equivalents during vesting; service required. |
| PSU (target) | 38,300 | 549,988 | 3 one‑year performance periods (ROE and Relative TSR at 50%/50%); up to 200% of target; service required. |
2024 stock vested (realized) – Spector
| Type | Shares vested | Value realized ($) |
|---|---|---|
| PSUs (2022/2023/2024 grants’ 2024 tranches) | 34,393 | 483,910 |
| RSUs | 28,967 | 399,248 |
| Total | 63,360 | 883,158 |
| All figures are as reported; RSU/PSU vestings include dividend equivalents where applicable (value based on grant agreements and fair market value on vest dates). |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (3/31/2025) | 270,741 common shares; <1% of outstanding (based on 87,010,608 shares). None pledged. |
| Unvested equity at 12/31/2024 (selected) | RSUs: 31,337 ($394,533); PSUs (2024 target): 38,300 ($482,197). Additional unvested from 2023: RSUs 23,024 ($289,872), PSUs 28,140 target ($354,283); 2022: RSUs 9,579 ($120,600), PSUs 12,900 actual 110.2% ($162,411). Per‑share $12.59 at 12/31/2024. |
| Ownership guidelines (executives) | CEO: $2,000,000; others: $500,000. Named execs with ≥5 years in role are in compliance. |
| Anti‑pledging/hedging | Hedging, pledging, short sales, margin trading prohibited; preclearance and trading windows required. |
| Insider activity (2025 vesting period) | Multiple Form 4 entries show tax‑withholding share dispositions around vest dates (e.g., 2/24–3/12/2025 entries for Spector at ~$14.07–$14.39), consistent with net share settlements, not discretionary selling. |
Employment Terms
- No employment agreement with PMT; no PMT cash severance, pensions, or nonqualified deferred comp. PMT grants equity under the 2019 Plan; executives are employed and paid in cash by PFSI.
- Change‑in‑control and termination:
- PSUs: vest on death/disability (capped at 100% pro‑rata) and fully vest if terminated without cause or if PMT’s management agreement is terminated without cause; double‑trigger on change‑in‑control if PMT remains listed; immediate vesting if delisted or if terminated in connection with the change‑in‑control.
- RSUs: continue on retirement (pro‑rata), fully vest on death/disability, termination without cause, or termination of management agreement without cause; double‑trigger on change‑in‑control if listed; immediate vesting if delisted.
- Management agreement: expires 12/31/2029; auto‑renews for 18‑month periods unless earlier terminated per agreement.
- Clawbacks: Dodd‑Frank/NYSE‑compliant clawback adopted September 2023 for Section 16 officers; separate 2018 policy for Senior Managing Directors.
Compensation Structure Analysis
| Topic | Observations |
|---|---|
| PMT pay mix | Equity‑only for PMT (PSUs/RSUs) with 55% PSUs / 45% RSUs target mix in 2024; bias to performance equity, minimum 1‑year vesting on ≥95% of awards. |
| Metric rigor shift | 2024 PSU ROE max increased from 10% to 12% and max payout from 150% to 200% to raise performance bar in a challenging macro backdrop. |
| PFSI pay context | CEO comp at PFSI was $10.6m in 2024 with ~89% variable; annual incentives: 70% ROE, 30% strategic goals; payout 81.8% of target in 2024 (ROE 8.5% → 52.6%; strategic 150%). |
| Peer group and advisor | Pearl Meyer as independent consultant; peer set expanded to include AGNC, Annaly, Dynex; market benchmarking emphasized. |
| Say‑on‑pay | ~98% support in 2022–2024; ongoing investor engagement and disclosure enhancements. |
Board Governance (Spector as Director)
- Role: Chairman (Class III). Management trustee; not a member of standing committees; Board has six principal committees, all chaired by independent trustees.
- Independence: 80% of trustees independent; Lead Independent Trustee (Preston DuFauchard) re‑elected March 2024; regular executive sessions.
- Combined CEO/Chairman: Board reaffirmed combined role in March 2025, citing domain expertise and strong lead independent structure.
- Attendance: Board met five times in 2024; all trustees attended ≥75% of meetings; all attended 2024 annual meeting.
- Director fees: Management trustees (Spector, Jones) receive no Board fees; non‑management trustee retainers and RSUs disclosed separately.
Director Compensation (as Director at PMT)
- Spector receives no additional compensation for Board service (compensated via executive capacity and equity grants).
Equity Ownership & Trading Pressure (12–24 months)
- Form 4 patterns indicate routine tax withholdings around February–March 2025 vestings (e.g., Spector: 18,522 at $14.07 on 2/24/2025; 4,819 at $14.11 on 2/25/2025; 5,791 at $14.39 on 2/28/2025; 5,254 at $14.33 on 3/12/2025), consistent with net share settlement rather than discretionary selling. Monitor late‑Feb/March each year for vest‑related supply.
Related Party Transactions (Alignment Risks)
- PMT is externally managed by PNMAC Capital Management, LLC (a PFSI subsidiary) and serviced by PennyMac Loan Services, LLC (also a PFSI subsidiary). 2024 fees: base management fee ~$28.6m; performance incentive fee $0; reimbursements ~$29.4m. Fee schedule is tiered on shareholders’ equity with potential incentive fee based on ROE with a “high watermark” adjustment. A Related Party Matters Committee with an external consultant oversees conflicts.
Multi‑Year Compensation (PMT grants to Spector)
| Year | PMT Salary ($) | PMT Stock Awards ($) | PMT Total ($) |
|---|---|---|---|
| 2024 | – | 999,987 | 999,987 |
| 2023 | – | 999,987 | 999,987 |
| 2022 | – | 999,985 | 999,985 |
| All amounts represent PMT equity (RSUs/PSUs) under the 2019 Plan; PMT pays no cash salary/bonus. |
PFSI 2024 Compensation (context; Spector)
| Salary ($) | Non‑equity Incentive ($) | Stock Awards ($) | Option Awards ($) | All Other ($) | Total ($) |
|---|---|---|---|---|---|
| 1,100,000 | 2,965,086 | 4,706,226 | 1,725,634 | 98,894 | 10,595,840 |
| Provided in PMT proxy as disclosure of PFSI compensation to the same individual; not directly allocated from PMT fees. |
Outstanding and Vested Equity Detail (Spector)
- Outstanding at 12/31/2024:
- RSUs: 31,337 ($394,533); PSUs (2024 grant target): 38,300 ($482,197).
- 2023 grants: RSUs 23,024 ($289,872); PSUs 28,140 target ($354,283).
- 2022 grants: RSUs 9,579 ($120,600); PSUs 12,900 at 110.2% ($162,411).
- 2024 vesting realized: Total 63,360 shares; value $883,158 (PSU 34,393/$483,910; RSU 28,967/$399,248).
Employment & Contractual Protections Summary
- Severance: None from PMT (cash severance not provided).
- Equity acceleration: Death/disability/retirement/termination without cause/management agreement termination without cause/change‑in‑control (double trigger if still listed; immediate if delisted) per RSU/PSU award agreements.
- Clawback: SEC/NYSE‑compliant; additional internal policy for senior MDs.
- Insider policy: Preclearance; no pledging/hedging/margin/short sales; Rule 10b5‑1 plans permitted under window and pre‑approval.
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑pay approval ~98% in 2022–2024, with iterative program enhancements (dual‑metric PSUs; ownership guidelines; clawbacks; majority vote standard).
Compensation Peer Group (for benchmarking)
AGNC Investment, Annaly Capital Management, Apollo Commercial Real Estate Finance, Arbor Realty Trust, ARMOUR Residential REIT, Blackstone Mortgage Trust, Chimera Investment, Dynex Capital, Ellington Financial, Invesco Mortgage Capital, KKR Real Estate Finance Trust, Ladder Capital, MFA Financial, Rithm Capital, New York Mortgage Trust, Redwood Trust, Starwood Property Trust, Two Harbors Investment.
Investment Implications
- Alignment: PMT’s equity‑only approach with 55% PSUs tied to ROE and Relative TSR, robust ownership guidelines, no pledging/hedging, and SEC/NYSE clawback supports alignment; 2024 PSU payouts (80.1%) were balanced against modest TSR relative percentile, indicating pay sensitivity to shareholder outcomes.
- Retention and supply: Three‑year RSU vesting and annual PSU tranches create predictable vesting calendars; recent Form 4s show net share settlements for taxes around late Feb–mid‑March, implying periodic but non‑discretionary insider supply—monitor those windows for technicals.
- Governance risk: Combined CEO/Chair carries typical oversight concerns; PMT mitigates with an independent Lead Trustee, independent committees (including a Related Party Matters Committee) and high board independence (80%).
- External manager complexity: The fee structure (base plus potential performance fee) and related‑party servicing necessitate continued scrutiny of ROE‑driven incentives and fee outcomes; no performance incentive fee was paid in 2024, which can temper concerns in a lower‑return year.
Notes on data provenance: All PMT governance, compensation, and ownership information from PMT’s 2025 DEF 14A (filed April 29, 2025). Insider transaction timing and characterization based on Form 4 aggregation page for PMT insiders. –;