FIRST BANCORP /PR/
For the period ended May 21, 2025. Filed Apr 8, 2025.
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What shareholders are asked to vote on at a company's meeting. It is where to find what directors and top executives are paid, and who owns the most shares.
May 21, 2025 · Filed Apr 8, 2025
Contents
Executive Compensation Program
Compensation Philosophy & Guiding Principles
The Corporation’s executive compensation program is performance-oriented and designed to support corporate strategic goals, including improved profitability and stockholder value appreciation. Our compensation philosophy is to pay for short-and long-term performance using both financial and non-financial measures.
| ☑ | Performance-Driven | Executive compensation must, to a large extent, be at risk, so that the amount earned is directly tied to the achievement of rigorous corporate, business unit and individual performance objectives that drive long-term value creation. |
| ☑ | Stockholder-Aligned | Executives should be compensated through compensation elements (base salaries, and short- and long-term incentives) designed to enhance stockholder value. |
| ☑ | Competitively Positioned | Target compensation should be competitive with that being offered to individuals in comparable roles at other companies with which we compete for talent to ensure that the Corporation employs the best executives to continue its success. |
| ☑ | Responsibly Governed | Decisions about compensation should be guided by best-practice governance standards and rigorous processes that encourage prudent decision-making. |
| 1 | Effective April 1, 2025, Mrs. Rivera was appointed as Chief Consumer Officer and Chief of Staff. |
| Proxy Statement for the 2025 Annual Meeting of Stockholders | First BanCorp | 49 |
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Compensation Discussion & Analysis (CD&A) | Executive Compensation Program
Summary of Program Elements
The executive compensation program is supported by the following principal elements of compensation:
| Pay Element | How It Is Paid | Purpose |
| Fixed | ||
| Base Salary | Cash | Provide a competitive base salary rate relative to similar positions in the market and enable us to attract and retain critical executive talent |
| Variable | ||
| Short-Term Incentives | Cash | Reward executives for delivering on annual corporate profitability, asset quality, risk management and operating efficiency objectives that contribute to stockholder value creation and provide accountability and feedback through individual scorecards and assessments of leadership and core competencies |
| Long-Term Incentives | Equity | Provide incentives for executives to execute on longer-term financial goals that drive stockholder value creation and support the Corporation’s leadership stability objectives |
Target Total Direct Compensation Mix
Our executive compensation program aims to provide an appropriate mix of pay based on performance, driving our business strategy, creating long-term stockholder value, and supporting leadership stability objectives. The program also addresses compensation risk by using a combination of financial results including credit quality, strategic accomplishments and a demonstration of leadership and other core competencies.
| Variable Award Type | Percentage of Award Type | Component of Award Type |
| Short-Term Incentive | Cash Based on balanced scorecard of key financial, strategic, and operational results and individual goals and competencies | |
| Long-Term Incentive | Performance Shares Based on achievement of pre-determined targets at the end of a three-year performance period as follows:• 50% based on achievement of a targeted level of tangible book value (the “TBV Target Performance”); and• 50% based on total shareholder return (“TSR”) relative to companies comprising the KBW Regional Bank Index on the last day of the three-year performance period (the “TSR Target Performance”) | |
| Time-Vested Restricted Stock Vesting of shares in 50% increments on the second and third anniversaries of the grant date | ||
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| 50 | First BanCorp | Proxy Statement for the 2025 Annual Meeting of Stockholders |
Compensation Discussion & Analysis (CD&A) | Executive Compensation Program
The charts presented below illustrate the 2024 target compensation pay mix of our CEO and other NEOs by each compensation component.
Compensation Governance Best Practices and Policies
The following practices and policies, which we believe are in the best interests of our stockholders and NEOs, are also embedded in our program to promote sound compensation governance:
Link a significant portion of compensation to performance using short-term (cash) and long-term (equity) compensation to encourage both proactivity and long-term sustainability.
Employ a variety of performance metrics to deter excessive risk-taking by eliminating any incentive based on a single performance goal.
Build in appropriate levels of discretion to adjust incentive payouts if results are not aligned with credit quality, regulatory compliance or leading indicators of future financial results.
Use equity incentives to promote total return to stockholders, long-term performance and executive retention.
Clawback all incentive-based variable pay from an executive officer determined to have engaged in intentional fraud or gross misconduct, or in the event of a financial results restatement as a result of material noncompliance with any financial reporting requirement under the federal securities laws.
Conduct annual incentive risk reviews to ensure that our compensation programs do not promote imprudent behaviors or excessive risk-taking.
Engage an independent compensation consultant who advises and reports directly to the Compensation Committee.
Prohibit hedging and pledging of the Corporation’s securities by Section 16 officers and directors.
Require meaningful stock ownership by our executive officers. Our CEO and other NEOs must own Common Stock having a value equal to five times and two times their base salaries, respectively, based on the higher of the market value or book value of the Corporation’s Common Stock on the last trading day of the applicable calendar year, for as long as they are employed by the Corporation.
Annual say-on-pay advisory vote.
For details about the Compensation Committee’s decisions based on 2024 performance, please refer to “The 2024 Executive Compensation Program in Detail,” starting on page 55 of this CD&A.
| Proxy Statement for the 2025 Annual Meeting of Stockholders | First BanCorp | 51 |
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Compensation Discussion & Analysis (CD&A) | 2024 Business Overview / Impact on Executive Compensation
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.