Carlos Salas
PATRIOT NATIONAL BANCORPAbout Carlos Salas
Carlos P. Salas, age 53, was appointed Executive Vice President and Chief Financial Officer (CFO) of Patriot National Bancorp, Inc. (PNBK) and its subsidiary Patriot Bank, N.A. on July 30, 2025; he was also appointed to the Boards of both entities following regulatory non-objections from the Federal Reserve Bank of New York and the OCC . He brings nearly three decades of experience across finance, law, banking operations, securities clearing, private equity, and investment banking, including leadership roles at The Change Company (President; Chairman of Change Lending LLC), Axos/COR Clearing (President/CEO), Banc of California (EVP/Chief of Staff), and earlier tenures at DLJ/Credit Suisse and Cleary Gottlieb; educated BA (NYU) and JD (University of Chicago Law) . Under his tenure in 2025, PNBK improved quarterly losses and strengthened capital via multiple equity transactions, with Q3 2025 net loss of $2.7M versus $27.0M a year ago and capital ratios exceeding OCC-imposed minimums (though the Bank remains classified “adequately capitalized” pending OCC evaluation) .
Selected operating and capital metrics
| Metric | Q3 2024 | Q3 2025 |
|---|---|---|
| Net loss ($000) | $(26,954) | $(2,657) |
| Net interest income ($000) | $4,999 | $5,010 |
| Weighted avg shares (basic) | 3,976,073 | 99,937,915 |
| Balance sheet | Dec 31, 2024 | Sep 30, 2025 |
|---|---|---|
| Loans receivable, net ($000) | $700,167 | $581,479 |
| Deposits ($000) | $966,597 | $830,855 |
| Total assets ($000) | $1,012,292 | $950,752 |
| Regulatory ratios (Bank) | Dec 31, 2024 | Sep 30, 2025 |
|---|---|---|
| Total capital ratio | 7.71% | 19.19% |
| Tier 1 capital ratio | 7.58% | 18.54% |
| CET1 capital ratio | 7.58% | 18.54% |
| Tier 1 leverage ratio | 5.79% | 11.95% |
Note: Bank capital ratios exceed OCC Agreement minimums but “well capitalized” classification is deferred pending OCC evaluation under the January 2025 formal agreement .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Change Company | President; Board member; Chairman of Change Lending LLC | Since 2019 | Grew lending and capital markets serving underbanked borrowers |
| Change Lending, LLC | CEO | 2021–Apr 2025 | Led mortgage lender operations within CDFI platform |
| COR/COR Clearing (now Axos Clearing LLC) | CFO (parent); President/CEO (clearing firm) | 2012–2019 | Built national securities clearing firm and executed sale to Axos Financial |
| Banc of California, Inc. (NYSE:BANC) | EVP & Chief of Staff | 2016–2017 | Supported bank and holding company operations at scale |
| Dolphin Advisors, LLC | Co-founder | 2004–2010 | Managed middle-market PE fund; served on portfolio company boards |
| Donaldson, Lufkin & Jenrette / Credit Suisse First Boston | Investment Banker (LA office) | Pre-2004 | Structured and executed investment banking transactions |
| Cleary Gottlieb Steen & Hamilton | Attorney | Pre-DLJ | Legal training and practice |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The Change Company | President; Director | Since 2019 | Expanded inclusive lending initiatives |
| Change Lending LLC | Chairman | Since 2019 | Led mortgage platform governance |
Fixed Compensation
| Component | 2025 Terms | Notes |
|---|---|---|
| Base Salary | ≥ $250,000 per year | Employment Agreement; subject to regulatory constraints given OCC status |
| Target Bonus % | ≥ 50% of base salary | Annual bonus in cash and/or awards under 2025 Omnibus Equity Incentive Plan, tied to performance objectives set by Compensation Committee in consultation with Salas |
| Term | CFO service through Apr 30, 2028; auto-renewal for 2-year terms unless terminated | Covers PNBK and Patriot Bank |
Performance Compensation
| Instrument | Grant / Formula | Vesting | Payout / Settlement | Performance Metrics |
|---|---|---|---|---|
| Initial RSU Award | 1,000,000 RSUs | Three-year vesting | Shares upon vesting (subject to shareholder-approved Plan); cash-only if Plan not approved (Plan approved on Jun 26, 2025) | Annual objectives set by Compensation Committee; specific KPIs not disclosed |
| Annual RSU Award | 0.5% × (year-end outstanding shares − max(prior issuances to Salas, 100,000,000)) | As designated in award agreements under the Plan | Shares upon vesting (Plan approved) | Not disclosed; governed by Plan and Committee determinations |
| Change-of-Control Treatment (Plan) | If no equivalent replacement awards: options/SARs fully exercisable; full-value awards vest; performance awards vest at greater of target or actual through last measurable date | Double-trigger for replacement awards on death, disability, retirement, CoC termination without cause or for good reason within 24 months | As specified by Plan | Plan-level provisions; not specific to Salas contract |
Equity Ownership & Alignment
| Ownership Snapshot | As of Record Date (May 16, 2025) | As of Form 3 (Jul 30, 2025) |
|---|---|---|
| Direct Common | — | 1,000,000 shares (D) |
| Indirect Common | 1,333,334 shares via HECA Management LLC (managing member) | 1,333,334 shares via HECA Management LLC (I) |
| Total Beneficial Shares | 1,333,334 | 2,333,334 |
| % of Class | 1.7% | Not stated on Form 3; company had 114,991,017 shares outstanding on Nov 14, 2025 |
| RSUs (unvested) | Plan approved Jun 26, 2025; initial RSU grant 1,000,000 three-year vesting | Same |
| Pledging / Hedging | Board has not adopted a hedging policy ; pledging not disclosed | Not disclosed |
| Ownership Guidelines | Not disclosed | — |
Company-wide RSU activity: 11.4M RSUs granted and 2.18M vested YTD through Q3 2025; unrecognized RSU compensation expense $8.8M, recognized RSU expense $3.1M YTD . This indicates continuing equity-based compensation overhang that can translate to selling pressure upon vesting.
Employment Terms
| Provision | Detail |
|---|---|
| Role & Start | CFO and Director at Company and Bank effective Jul 30, 2025 |
| Term | Through Apr 30, 2028; auto-renewals in two-year increments unless earlier termination |
| Base + Bonus | Base ≥ $250,000; target bonus ≥ 50% of base; paid in cash and/or equity under Plan; performance objectives set by Compensation Committee |
| Equity Awards | Initial 1,000,000 RSUs (3-year vesting); Annual RSU formula as above |
| Severance / Change-of-Control | Not disclosed in summary; Plan-level equity CoC rules apply for awards |
| Clawback | Executive officer clawback policy adopted Nov 30, 2023; triggered by accounting restatements; Compensation Committee may recoup erroneously awarded comp |
| Hedging / Pledging Policy | No hedging policy adopted; pledging not disclosed |
| Regulatory Constraints | Bank operating under OCC Agreement (Jan 2025) imposing enhanced governance, BSA/AML, credit/admin controls; capital minima enforced; “well capitalized” status contingent on OCC evaluation |
Board Governance
- Board service history: Elected at 2025 AGM (Jun 26, 2025) subject to FRB non-objection; appointed Jul 30, 2025 as Company and Bank director . As an executive officer, Salas is not independent under Nasdaq standards .
- Committees (2024 composition): Audit (Constantino—Chair, Van den Bol, Weinbaum); Compensation (Constantino—Chair, Van den Bol, Weinbaum); Nominating & Governance (Van den Bol—Chair, Constantino, Weinbaum); Executive (Carrazza—Chair, Sugarman, Constantino, Van den Bol) .
- Attendance: Board met 11 times in 2024; all directors attended ≥75% of aggregate meetings of Board and committees served .
- Lead Independent Director: Edward N. Constantino (since Oct 2018) .
- Bylaws updated May 15, 2025; established a combined Compensation, Nomination & Governance Committee and reaffirmed committee structures .
- Director Compensation: Non-employee directors received cash retainers and annual RSUs (grant date value ~$14,346) in 2024; fees suspended in Nov 2024 and remained suspended as of the proxy; executive officers serving as directors do not receive Board compensation .
Compensation Structure Analysis
- Pay mix shift to equity: Initial 1,000,000 RSUs and formulaic annual RSU awards suggest increased equity-linked compensation tied to share count, creating potential dilution and future selling pressure upon vesting .
- Performance metrics: Annual bonus metrics to be determined; specific KPIs (e.g., revenue growth, credit outcomes, capital, risk remediation) not disclosed in filings .
- Clawback and change-of-control: Restatement-based clawback policy exists; Plan provides acceleration if no replacement awards post-CoC and double-trigger vest for substitutes—generally shareholder-friendly guardrails .
- Related-party dynamics: HECA Management LLC (managed by Salas) and other insiders invested in the March 2025 private placement; Board expansion included investors and affiliates, raising governance focus on independence and related-party oversight .
Vesting Schedules and Insider Selling Pressure
- RSU vesting: Salas’ initial RSUs vest over three years (equal installments); settlement in shares given Plan approval; substantial Company-wide RSU grant activity indicates potential periodic supply from vesting .
- Options: Company granted stock options in mid-2025 (400k @ $1.40; 450k @ $1.59) broadly; expense recognized modestly; no option grant specific to Salas disclosed .
- Form 3 ownership: As of Jul 30, 2025, Salas disclosed 1,000,000 direct shares and 1,333,334 indirect shares (HECA), indicating meaningful personal equity stake aligned with shareholder value .
Performance & Track Record (Predictive of Future Performance)
- Turnaround actions: PNBK executed a $57.75M private placement (Mar 20, 2025), a $10.7M registered direct (Jun 3, 2025), and a $25.6M registered direct/warrant offering (Aug 29, 2025), materially strengthening capital and liquidity; note conversions of senior notes into equity by holders (Unity, AmBank) .
- Loss trajectory: Quarterly losses narrowed substantially; net charge-offs down to 0.14% of average loans (annualized) in Q3 2025 versus 0.56% YoY; ACL at 1.22% of loans with introduced qualitative factors under CECL .
- Balance sheet optimization: Loans reduced ~$119M YTD; deposits reduced ~$136M; investments increased; programmatic changes (exit residential mortgage origination; suspend SBA PLP; rationalize consumer loan exposure) .
- Regulatory posture: OCC Agreement in place; capital ratios above OCC minima but classification remains “adequately capitalized”—execution risk persists in risk, compliance, and payment oversight remediation .
Board Service History, Committees, and Dual-Role Implications
- Board service: Elected Jun 26, 2025; appointed Jul 30, 2025 as director of Company and Bank alongside CFO role .
- Committee roles: Specific committee assignments for Salas not disclosed; as an executive officer, he would not serve on independent committees like Audit/Comp due to independence requirements .
- Dual role implications: CFO serving as director reduces Board independence; heightened oversight required to manage related-party transactions and equity issuance decisions (e.g., private placements involving insiders) .
- Independence safeguards: Lead Independent Director and independent committee structures in place; attendance and governance policies disclosed; bylaws updated May 2025 to strengthen governance processes .
Related Party Transactions
- Private Placement participation by insider-affiliated entities: HECA Management LLC (managed by Salas) invested in PNBK securities in March 2025; other insider and investor affiliates also participated; independent directors assess and approve related-person transactions; directors involved recuse .
- Note conversions: Chairman-linked entity (Solaia) converted senior note principal/interest into common stock in May 2025 under amended terms .
Risk Indicators & Red Flags
- Regulatory risk: OCC Agreement with elevated capital and governance requirements; failure to meet timelines could trigger further restrictions .
- Equity overhang/dilution: Large authorized share increase and Plan allowing up to 20% of outstanding shares for awards; high RSU grant/vest amounts create ongoing dilution and potential supply pressure .
- Hedging policy gap: No anti-hedging policy—potential misalignment; pledging practices not disclosed .
- Payment program reliance: Digital Payments Division depends on third-party managers/processors under BINs, increasing operational/compliance exposure .
Director Compensation (Board-level; executive directors excluded)
| Component | 2024 Amounts / Policy |
|---|---|
| Annual retainer (cash) | $19,100; plus $1,150 per Board meeting; committee fees $375–$750; chair retainers $3,000–$9,200 |
| Equity comp (RSUs) | ~$14,346 grant date value; vests in four equal annual installments |
| Fee status | Board fees suspended in Nov 2024 and continued as of proxy date |
| Policy | Executive officers (e.g., CFO) do not receive Board comp |
Say-on-Pay & Shareholder Feedback
- Not disclosed for 2025 proxy; prior say-on-pay results not included in filings reviewed. Board policies on shareholder communications and meeting logistics outlined in proxy .
Expertise & Qualifications
- Degrees: BA (NYU); JD (University of Chicago Law) .
- Technical expertise: Banking operations, securities clearing, capital markets, credit and risk management, legal and investment banking .
- Industry experience: Finance, mortgage lending (CDFI), commercial banking platforms, PE portfolio governance .
WORK HISTORY & CAREER TRAJECTORY
See Past Roles and External Roles tables above .
Compensation Committee Analysis
- Committee independence: Audit and Compensation committees composed of independent directors in 2024; committee charters available .
- Consultants: Compensation Committee may engage consultants; not specifically disclosed for 2025 .
- Plan administration: Compensation Committee administers 2025 Omnibus Plan, including award grants, blackout periods, clawback alignment, and change-in-control treatment .
Investment Implications
- Alignment: Salas holds meaningful direct and indirect stakes plus large RSU grant, aligning with equity value creation; however, absence of hedging policy and substantial plan capacity (20% of outstanding shares) signals continuing dilution risk and potential selling pressure as awards vest .
- Execution risk: Regulatory remediation under OCC Agreement, payment program third-party reliance, and credit portfolio optimization introduce operational and compliance risks even as capital ratios improve .
- Turnaround trajectory: Narrowing losses, reduced net charge-offs, and fortified capital are positives; continued balance sheet de-risking (loan and deposit reductions), exit from certain origination programs, and new lending programs with deposit requirements suggest disciplined growth; monitor RSU overhang and annual award formula impact on dilution .
- Governance: CFO-director dual role reduces independence—ensure robust independent oversight on compensation and capital decisions; related-party transaction policies are in place, but investor-grade diligence should track future insider participation in financings .
Sources: Appointment/compensation terms ; proxy governance and director policies ; beneficial ownership table ; Form 3 ; 2025 Omnibus Plan details ; Q3 2025 10-Q performance, capital, RSUs and balance sheet .