Peter Fan
About Peter Fan
Peter C. Fan, age 60, was appointed Senior Vice President, Chief Financial Officer, and Corporate Secretary of Provident Financial Holdings, Inc. (and Provident Savings Bank, F.S.B.) effective May 12, 2025; he holds an MBA from UCLA and a BS in Accounting from USC and is a CPA in California (inactive) . At appointment, Provident’s FY2025 performance reflected net income of $6.255 million and cumulative TSR of $118.05 on an initial $100 investment since June 30, 2022; FY2025 incentive thresholds were not met, emphasizing a disciplined pay-for-performance framework . Fan also serves as Corporate Secretary, including signing the 2025 proxy and shareholder materials .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Royal Business Bank | Senior Vice President – Director of Finance & Treasury | Feb 2024 – May 2025 | Led finance/treasury with emphasis on strategic corporate initiatives, liquidity and capital planning, ALM, budgeting, and forecasting . |
| Pacific Western Bank | Senior Vice President – Finance | Apr 2014 – Feb 2024 | Senior finance leadership spanning budgeting, forecasting, and capital/liquidity disciplines . |
Fixed Compensation
| Component | Policy Detail |
|---|---|
| Base salary (senior officers) | Set competitively vs similarly sized banks; based on responsibility, ability, experience, and performance; subject to annual review and adjustment . |
| Benefits | Senior executives participate in broad employee benefits; specifics for CFO not disclosed in proxy; severance benefits summarized in Employment Terms . |
Performance Compensation
| Metric | Threshold | Target | Maximum | FY2025 Actual | Notes |
|---|---|---|---|---|---|
| Net income ($) | 8,316,000 | 10,395,000 | 15,593,000 | 6,255,000 | Net income must be met to trigger awards; FY2025 below threshold, implying no bonuses under the plan . |
| ROAA (%) | 0.65 | 0.82 | 1.23 | 0.50 | Below threshold . |
| ROAE (%) | 6.44 | 8.05 | 12.07 | 4.79 | Below threshold . |
| Efficiency ratio (%) | 71.29 | 66.67 | 57.38 | 78.96 | Above threshold (higher is worse); not met . |
| Diluted EPS ($) | 1.23 | 1.54 | 2.30 | 0.93 | Below threshold . |
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Plan design: Annual incentive baseline up to 25% of salary for senior officers; payouts are a percentage of base salary and require the net income threshold (overrides other components). Discretionary modifications are rare; clawback provisions apply .
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Equity incentives: Long-term incentives via stock options and restricted stock with multi-year vesting; option exercise price ≥100% of FMV at grant; awards are discretionary and subject to committee approval . Accelerated vesting applies under change-in-control and (for certain plans) involuntary termination within 12 months post-change-in-control; death/disability acceleration also applies .
Equity Ownership & Alignment
| Policy | Detail |
|---|---|
| Stock ownership guidelines | Director: 300% of base cash retainer; CEO: 300% of base salary; President: 200%; Senior Officer: 100% . |
| Compliance status | As of June 30, 2025, all directors and senior officers were in compliance with ownership guidelines; new senior officers have a five-year timeline from appointment to achieve compliance . |
| Retention guidelines | Must retain 50% of net shares from option exercises/RSU vesting until ownership guideline met (with limited waivers) . |
| Hedging/pledging | Hedging of Provident stock and pledging/margin accounts are prohibited for directors and senior officers . |
Beneficial ownership by Peter Fan is not disclosed in the FY2025 proxy’s NEO ownership table (CFO was not a named executive officer for FY2025) .
Employment Terms
| Term | Detail |
|---|---|
| Severance agreement effective date | May 22, 2025; expires Feb 28, 2026; extendable annually by Board . |
| Change-in-control trigger (double-trigger) | Benefits payable if involuntary termination (other than for cause) within 12 months post-change-in-control, or resignation within 12 months due to demotion/loss of authority/title, compensation/benefits reduction, or relocation >35 miles . |
| Cash severance | Lump sum = 2x then-current base salary + 2x largest annual bonus paid in the two years prior to termination . |
| Benefits continuation | Life, medical, dental, vision, and disability coverage continued for two years post-termination . |
| Clawback | Company-wide Compensation Recovery Policy adopted Nov 28, 2023 (Section 10D/Nasdaq 5608) for restatements; incentive plan clawbacks for misconduct/risk-taking apply to executives . |
Investment Implications
- Strong alignment policies: Hedging and pledging bans, mandatory ownership/retention, and clawbacks reduce misalignment and downside hedging risks; CFO role falls under these stringent governance policies .
- Retention economics: CFO’s double-trigger severance (2x salary + 2x bonus, two years of benefits) is standard for regional banks; it cushions change-in-control risk without single-trigger acceleration, moderating immediate deal-driven turnover risk .
- Pay-for-performance discipline: FY2025 incentives did not pay due to missing net income threshold, indicating tight linkage to financial outcomes; this reduces discretionary payouts and supports investor alignment as Fan assumes CFO responsibilities .
- Execution focus: Fan’s background in ALM, liquidity/capital planning, and forecasting directly addresses bank-critical levers in a higher-rate environment; success should be observable in net income, ROAA/ROAE, efficiency, and EPS—metrics explicitly tied to incentive frameworks .