Cathy W. Zbanek

About Cathy W. Zbanek

Cathy W. Zbanek is Chief Synergy Officer at TFS Financial Corporation (Third Federal Savings & Loan), a role she has held since 2020. She joined Third Federal in 2001; prior roles include Chief Marketing and Human Resources Officer (2013–2020), with earlier leadership across Customer Service, Marketing, and strategic systems/program development. She holds a BA in Economics and Psychology from the University of Pennsylvania. Compensation levers tie directly to profitability: annual bonuses are funded by adjusted net income versus budget, and PSUs pay out based on return on average assets (ROAA), aligning incentives with bank earnings quality and capital efficiency. Over the five years ended 9/30/2024, TFSL’s cumulative total return modestly increased from 100.0 to 102.49; net income rose from $75.3M in FY2023 to $79.6M in FY2024 and $90.96M in FY2025, underscoring improving profitability under the current incentive architecture [functions.GetFinancials]*.

Past Roles

External Roles

Fixed Compensation

Notes:

• Perquisites include financial/retirement/estate planning; no aircraft/security use disclosed for Ms. Zbanek .
• Company made discretionary 401(k) contributions equal to 2.5% of eligible base salary in FY2023 and FY2024; matching policy changed from up to 4% (2023) to up to 2% (2024) of employee contributions .

Performance Compensation

Annual bonus design (Management Incentive Compensation Plan):

• Funding metric: Adjusted Net Income versus budget, with interpolation between 20%–110% of budget; above 110% capped at 110%. Adjustments may exclude certain taxes/regulatory/pension/medical items, loan sales/MSR amortization offsets, bankruptcy discharges, and accounting changes; committee may reduce payouts for risk considerations .
• FY2024 pool distribution: Zbanek received 13.42% of the pool (CEO 51.87%, CFO 15.91%, CIO 9.41%, Chief Innovation Officer 9.41%) .

PSU performance metrics and vesting:

• Metric: Company ROAA over a two-year performance period; payout scale: below 0.3% = 0%; 0.3% = 50%; 0.5% = 100%; 0.7%+ = 150%; linear interpolation between points .
• FY2024 grants (3/4/2024) cover FY2024–FY2025 performance; vest and deliver in December in the third year following grant, subject to achieved performance .
• RSUs vest 33 1/3% annually over ~3 years and are distributed at vest; both RSUs and PSUs carry dividend equivalents (paid in cash on earn/vest) .

Upcoming vesting schedule (units) — oldest to newest:

Equity Ownership & Alignment

Beneficial ownership trend (shares):

Notes:

• RSUs/PSUs are excluded from the beneficial share counts; options exercisable within 60 days are included when applicable per proxy footnotes. The Company’s MHC owns ~81% of TFSL outstanding shares, structurally limiting individual % stakes .
• Insider policy prohibits officers and directors from hedging or pledging Company stock; thus, pledging is prohibited (a governance positive) .
• The Company maintains no specific stock ownership guidelines for executives; the committee cites existing holdings, options and RSUs as sufficient alignment .

Outstanding equity and options at FY2024 year-end (Zbanek):

• Unvested RSUs/PSUs (units; see vesting table above) .
• Stock options (exercisable), with strike and expiry:
  • 32,400 @ $14.85, exp 12/18/2024
  • 108,300 @ $14.81, exp 05/28/2025
  • 49,200 @ $19.06, exp 12/17/2025
  • 79,400 @ $19.31, exp 12/15/2026
  • 187,500 @ $14.74, exp 01/05/2028
  • Reference price for equity valuations at 9/30/2024: $12.86 (implies these options were out-of-the-money at that date) .

Employment Terms

• No employment or severance agreements for named executive officers; severance evaluated case-by-case .
• Equity acceleration: immediate vesting upon death, disability, or change in control (as defined); retirement vests ratably each calendar quarter over the first year of grant; otherwise unvested awards are forfeited upon termination (other than death/disability/retirement) .
• Change-in-control definition includes acquisition of ≥25% beneficial ownership (excluding MHC), board turnover, certain mergers, etc. .
• Clawback: Dodd-Frank Rule 10D-1-compliant policy to recoup erroneously awarded incentive compensation for the prior 3 completed fiscal years upon a required financial restatement .
• Hedging/pledging prohibited for officers and directors .

Change-in-control and termination equity value (hypothetical at 9/30/2024):

Performance & Track Record

• Company TSR (cumulative total return): $100 invested on 9/30/2019 grew to $102.49 by 9/30/2024 (dividends reinvested), indicating modest shareholder return through the rate cycle and banking volatility .
• Profitability trend (context for incentives):
  • Net Income ($M): FY2023 $75.25 , FY2024 $79.59 , FY2025 $90.96 .
• Annual bonus pool allocations and PSU ROAA construct indicate pay-for-performance alignment with earnings quality and balance-sheet discipline, central to a thrift’s economic model .

Compensation Structure Analysis

• Cash vs. equity mix: Total pay has remained balanced across base, annual cash bonus, and equity; stock award values varied with grant cadence/size ($418k→$481k→$344k in FY2022–FY2024) .
• At-risk pay: Bonuses keyed to adjusted net income versus budget; PSUs keyed to ROAA with 0–150% payout curve; RSUs primarily retention vehicles with 3-year graded vesting .
• Equity risk posture: Legacy options largely out-of-the-money at $12.86 reference price, reducing near-term exercise/sell pressure; RSU/PSU vesting clusters in December could drive tax-related withholdings (company-level) and modest incremental insider liquidity around vest dates .

Say-on-Pay, Ownership Guidelines, Policies

• Stock ownership guidelines: None for executive officers; committee asserts alignment via existing holdings and awards .
• Clawback adopted and in force; insider trading policy bans hedging/pledging; no waivers reported in FY2024 .

Equity Ownership & Alignment Detail

Investment Implications

• Incentive alignment: Annual cash tied to adjusted net income and PSUs to ROAA suggests management is rewarded for earnings and balance sheet efficiency rather than revenue growth, appropriate for a thrift; expect higher PSU payouts when ROAA moves toward or above 0.5% targets .
• Selling pressure: December RSU/PSU vesting schedules (12.5k/13.4k/… in upcoming tranches) introduce predictable vest events; however, legacy options are out-of-the-money at the 9/30/2024 reference price, limiting option-related selling risk near term .
• Retention and change-of-control: No fixed severance agreements; equity acceleration valued at ~$0.92M for Zbanek at 9/30/2024 under death/disability/CoC; combined with steady base salary and RSU cadence, retention risk appears moderate without golden-parachute-type cash multipliers .
• Ownership/skin-in-the-game: ~551k shares beneficially owned with long firm tenure support alignment; absence of pledging and existence of a clawback buttress governance posture. That said, lack of formal ownership guidelines could be viewed as a governance gap versus larger-cap peers .
• Performance context: Five-year TSR essentially flat (+2.5%) while net income has grown, implying valuation and capital return dynamics (including MHC dividend waivers and sector headwinds) may constrain equity sensitivity to internal performance; annual and long-term pay design appropriately focuses on ROAA and net income to drive value where controllable .

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Sources:

• Executive biography and roles .
• Compensation tables and details .
• Annual bonus plan and pool allocations .
• PSU/RSU design and ROAA scale .
• Outstanding equity and vesting schedules, reference price .
• Ownership tables .
• Policies (clawback, insider trading/hedging/pledging, ownership guidelines) .
• TSR tables .

Financial performance table values retrieved from S&P Global where indicated with an asterisk.