SEC Form DEF 14A filed by Central Pacific Financial Corp New

Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934 (Amendment No.  )

Filed by a Party other than the Registrant   ☐

Check the appropriate box:

 ☐  Preliminary Proxy Statement

 ☐  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

☒  Definitive Proxy Statement

 ☐  Definitive Additional Materials

 ☐  Soliciting Material under §240.14a-12

 

☒  No fee required.

 ☐  Fee paid previously with preliminary materials.

 ☐  Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

CENTRAL PACIFIC FINANCIAL CORP.

220 South King Street

Honolulu, Hawaii 96813

(808) 544-0500

March 7, 2025

On behalf of your Board of Directors, we cordially invite you to attend the 2025 Annual Meeting of Shareholders of Central Pacific Financial Corp. The Annual Meeting will be held on Thursday, April 24, 2025, at 11:00 a.m., Hawaii time. This year’s Annual Meeting will be held virtually. You can attend online at www.virtualshareholdermeeting.com/CPF2025, where you will be able to vote and submit questions electronically during the Annual Meeting. You may vote before the Annual Meeting at www.proxyvote.com. Specific Instructions for accessing the Annual Meeting are provided on the notice, proxy card or voting instruction form you received (and please have this notice, proxy card or voting instruction form available when you visit the website) and in the “Attending the Meeting” section of the Proxy Statement.

This year, we will again be using the “Notice and Access” method of providing proxy materials to shareholders via the Internet. We believe that this process provides shareholders with a convenient and quick way to access the proxy materials and vote, while allowing us to conserve natural resources and reduce the costs of printing and distributing the proxy materials. We will mail to our shareholders a Notice of Internet Availability of Proxy Materials containing instructions on how to access our proxy statement and the Form 10-K and vote electronically via the Internet. This notice will also contain instructions on how to receive a paper copy of the proxy materials. All shareholders who do not receive a notice will receive a paper copy of the proxy materials by mail or an electronic copy of the proxy materials by email.

The accompanying Notice of Annual Meeting of Shareholders and Proxy Statement describe proposals to be acted upon at the Annual Meeting. Please give these materials your prompt attention. Then, we ask that you vote by Internet, telephone or by mail, as set forth in the voting instructions or proxy card that are included with these materials, to ensure that your shares are represented and voted at the meeting. Shareholders who attend the meeting may withdraw their proxy and vote at the meeting if they wish to do so. Your vote is important, so please act at your earliest convenience.

We appreciate your continued interest in Central Pacific Financial Corp.

Sincerely,

 

CENTRAL PACIFIC FINANCIAL CORP.

220 South King Street

Honolulu, Hawaii 96813

(808) 544-0500

NOTICE IS HEREBY GIVEN that, pursuant to its Bylaws and the call of its Board of Directors, the Annual Meeting of Shareholders (the “Meeting”) of Central Pacific Financial Corp. (the “Company”) will be held virtually on Thursday, April 24, 2025, at 11:00 a.m., Hawaii time. The Meeting will be a completely virtual meeting of shareholders, to be conducted via live audio webcast. You will be able to attend the Meeting, vote at the Meeting, and submit your questions during the Meeting by attending virtually at

www.virtualshareholdermeeting.com/CPF2025.

The Meeting is being held for the purpose of considering and voting upon the following proposals:

Only those shareholders of record at the close of business on February 19, 2025 shall be entitled to notice of and to vote at the Meeting or any postponement or adjournment thereof.

Dated: March 7, 2025

By Order of the Board of Directors,

 

Glenn K.C. Ching

 

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE

ANNUAL SHAREHOLDERS’ MEETING TO BE HELD ON APRIL 24, 2025

Our Proxy Statement and Annual Report on Form 10-K for the fiscal year ended December 31, 2024 are accessible, free of charge, at https://www.cpb.bank/2025proxy and https://www.proxyvote.com.

YOUR VOTE IS IMPORTANT. SHAREHOLDERS ARE URGED TO VOTE AND CAN DO SO BY INTERNET, TELEPHONE OR BY MAIL, AS SET FORTH IN THE VOTING INSTRUCTIONS OR PROXY CARD THAT ARE INCLUDED WITH THESE MATERIALS. SHAREHOLDERS WHO ATTEND THE MEETING MAY WITHDRAW THEIR PROXY AND VOTE AT THE MEETING IF THEY WISH TO DO SO.

This proxy statement includes estimates, projections, statements relating to our business plans, objectives, and expected operating results that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may appear throughout this proxy statement and relate to, among other things, our business, prospects, executive compensation program, governance goals and commitments. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “design,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties that may cause actual results to differ materially. We describe risks and uncertainties that could cause actual results and events to differ materially in the “Risk Factors,” “Quantitative and Qualitative Disclosures about Market Risk,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our latest Form 10-K and other periodic reports we file with the U.S. Securities and Exchange Commission (“SEC”). Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made. We undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events, or otherwise, except as required by law.

This Proxy Statement includes several website addresses and references to additional materials found on those websites. These websites and materials are not incorporated by reference herein.

 

 

CENTRAL PACIFIC FINANCIAL CORP.

220 South King Street

Honolulu, Hawaii 96813

(808) 544-0500

This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors (the “Board”) of Central Pacific Financial Corp. (the “Company”) for use at the 2025 Annual Meeting of Shareholders (the “Meeting”) of the Company to be held virtually at www.virtualshareholdermeeting.com/CPF2025 on Thursday, April 24, 2025, at 11:00 a.m., Hawaii time, and at any and all adjournments or postponements thereof. The Notice of Internet Availability of Proxy Materials, this Proxy Statement and accompanying form of proxy or voting instruction card, are first being made available to shareholders on or about March 7, 2025.

The proposals to be considered and voted upon at the Meeting will be:

The Board fixed the close of business on February 19, 2025 as the record date (the “Record Date”) for the determination of the shareholders of the Company entitled to notice of and to vote at the Meeting. Only holders of record of shares of the Company’s Common Stock (“Common Stock”) at the close of business on the Record Date will be entitled to vote at the Meeting and at any adjournment or postponement of the Meeting. There were 27,115,848 shares of the Company’s Common Stock, no par value, issued and outstanding on the Record Date, held by approximately 2,732 holders of record. There are no other classes of shares of the Company’s capital stock outstanding.

Each holder of Common Stock is entitled to one vote, virtually in person or by proxy, for each share of Common Stock standing in the holder’s name on the books of the Company as of the Record Date on any matter submitted to the vote of the shareholders.

The required quorum for the transaction of business at the Meeting is a majority of the total outstanding shares of Common Stock entitled to vote at the Meeting, either present virtually in person or represented by proxy. Abstentions will be included in determining the number of shares present at the Meeting for the purpose of determining the presence of a quorum.

Under the rules of the National Association of Securities Dealers, Inc., member brokers generally may not vote shares held by them in street name for customers unless they are permitted to do so under the rules of any national securities exchange of which they are a member. Under the rules of the New York Stock Exchange (“NYSE”), a member broker who holds shares in street name for customers has the authority to vote on certain “routine” proposals if the NYSE member broker has transmitted proxy soliciting materials to the beneficial owner but has not received instructions from that owner. NYSE member brokers will not be permitted to vote on proposal numbers 1 or 2 unless they receive instructions from their customers. NYSE rules permit member brokers that do not receive instructions from their customers, to vote on proposal number 3 as discussed above in their discretion.

The following chart sets forth the required vote to approve each proposal to be considered and voted upon at the Meeting, and the effect of “Withhold” votes, abstentions, and broker non-votes.

Additional information regarding each of these proposals is provided in the section titled “DISCUSSION OF PROPOSALS RECOMMENDED BY THE BOARD OF DIRECTORS” (for Proposals 1 through 3 above).

The following is the Board’s recommendation with respect to each of the proposals to be considered and voted upon at the Meeting:

It is not anticipated that any matters will be presented at the Meeting other than as set forth in the accompanying Notice of the Meeting and this Proxy Statement. If any other matters are presented properly at the Meeting, however, the proxy will be voted by the proxy holders in accordance with the recommendations of the Board or, if no recommendation is given, in their own discretion.

You may vote by Internet, telephone or by mail, as set forth in the voting instructions or proxy card that is provided to you.

Voting by Internet or Telephone. Voting by Internet or telephone is fast and convenient and your vote is immediately confirmed and tabulated. The Internet and telephone voting procedures are designed to authenticate votes cast by use of a personal identification number which is provided with your voting instructions. These procedures allow shareholders to appoint a proxy to vote their shares and to confirm that their instructions have been properly recorded. If you vote by Internet or telephone, you do not have to mail in a proxy card, but your vote must be received by the voting deadline set forth in your voting instructions.

Voting by Mail. If you wish to vote by mail, you may request a paper copy of these materials which will include a proxy card. If you vote by proxy card, be sure to complete, sign, date and mail your proxy card in the accompanying postage-prepaid envelope by the voting deadline set forth on the proxy card.

If your shares are held by a bank, broker or other nominee, please follow the instructions provided with your proxy materials to determine if Internet or telephone voting is available. If your bank or broker does make Internet or telephone voting available, please follow the voting instructions provided by your bank or broker.

If you vote by Internet or by telephone, you should not return a proxy card.

Any shareholder who executes and delivers a proxy has the right to revoke it at any time before it is exercised by filing with the Corporate Secretary of the Company an instrument revoking it or a duly executed proxy bearing a later date. A proxy may also be revoked by attending the Meeting and voting virtually in person at the Meeting, or by following the instructions at www.virtualshareholdermeeting.com/CPF2025. Subject to such revocation, all shares represented by a properly executed proxy received in time for the Meeting will be voted by the proxy holders in accordance with the instructions on the proxy. If your shares are held in street name, you should follow the instructions of your broker, bank or nominee regarding the revocation of proxies.

This solicitation of proxies is made on behalf of the Board and the Company will bear the costs of the preparation of proxy materials and the solicitation of proxies for the Meeting. It is contemplated that proxies will be solicited principally through the mail, but directors, officers and regular employees of the Company or its subsidiary, Central Pacific Bank (the “Bank”), may solicit proxies personally, by telephone, electronically or by other means of communication. Although there is no formal agreement to do so, the Company may reimburse banks, brokerage houses and other custodians, nominees and fiduciaries for their reasonable expenses in forwarding these proxy materials to beneficial owners. The Company has retained D.F. King & Co., Inc. to assist it in connection with the solicitation of proxies for a fee of approximately $10,000, plus reimbursement of expenses.

This year’s Meeting will be held virtually, and the Board of Directors and certain members of Company management may log in to the Meeting from remote locations.

The Company’s Proxy Statement and Annual Report on Form 10-K for the fiscal year ended December 31, 2024 are available free of charge at https://www.cpb.bank/2025proxy and at https://www.proxyvote.com.

In addition, the Company will provide without charge, upon the written request of any shareholder, a copy of the Company’s Annual Report on Form 10-K including the financial statements and the financial statement schedules, required to be filed with the United States Securities and Exchange Commission (the “SEC”) for the fiscal year ended December 31, 2024. Requests should be directed to Central Pacific Financial Corp., Attn: Investor Relations, P.O. Box 3590, Honolulu, Hawaii 96811 or to https://www.proxyvote.com. The Annual Report on Form 10-K includes a list of exhibits filed with the SEC, but the Annual Report on Form 10-K that we have posted or delivered to you does not include the exhibits. If you wish to receive copies of the exhibits, we will send them to you. Expenses for copying and mailing will be your responsibility. Please call the Corporate Secretary at (808) 544-0500 or write to the address above. The SEC also maintains an Internet site at https://www.sec.gov that contains information and exhibits we file with the SEC.

The Company will also deliver promptly upon written or oral request a separate copy of the Company’s Annual Report on Form 10-K and the Company’s Proxy Statement, to any shareholder who shares an address with other shareholders and where only one set of materials were sent to that address to be shared by all shareholders at that address.

We are furnishing materials to our shareholders primarily via the Internet instead of mailing printed copies of those materials to our shareholders. By doing so, we save costs and reduce the environmental impact of the Meeting. On March 7, 2025, the Company mailed a Notice of Internet Availability of Proxy Materials (“Notice”) to shareholders. The Notice contains instructions about how to access our proxy materials and vote online or by telephone. If you would like to receive a paper copy of our proxy materials, please follow the instructions included in the Notice.

Based on filings made under Section 13(d) and Section 13(g) of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of February 19, 2025, the following were the only persons known to management of the Company to beneficially own more than five percent of the Company’s outstanding Common Stock:

The following table sets forth certain information regarding beneficial ownership of Common Stock by each of the current directors, nominees, and the Named Executive Officers (as defined under “COMPENSATION DISCUSSION AND ANALYSIS”), as well as all directors and executive officers as a group, as of the close of business on February 19, 2025. Unless otherwise noted, the address of each person is c/o Central Pacific Financial Corp., 220 South King Street, Honolulu, Hawaii 96813.

The Company’s directors, executive officers and the beneficial holders of more than 10% of the Common Stock are required to file certain reports with the SEC regarding the amount of and changes in their beneficial ownership of the Company’s Common Stock. Based on its review of copies of those reports, the Company is required to disclose known failures to file required forms, or failures to timely file required reports during the previous year. To the best knowledge of the Company, there were no failures to file or timely file such required reports during year 2024 by any person who was at any time during year 2024 a director, officer, beneficial owner of more than 10% of the Common Stock, or any other persons subject to Section 16 of the Exchange Act with respect to the Company.

The Company currently has 12 directors: Earl E. Fry, Jason R. Fujimoto, Jonathan B. Kindred, Paul J. Kosasa, Christopher T. Lutes, Arnold D. Martines, A. Catherine Ngo, Robert K.W.H. Nobriga, Saedene K. Ota, Diane S.L. Paloma, Crystal K. Rose, and Paul K. Yonamine, all of whom are also nominees for directors. The term of all directors expires at the Meeting. Accordingly, there are 12 directors to be elected at the Meeting to serve one-year terms expiring at the 2026 Annual Meeting of Shareholders and until their respective successors are elected and qualified, subject to the earlier of their death, resignation, retirement, disqualification or removal from office.

All nominees have indicated their willingness to serve and unless otherwise instructed, proxies will be voted for all of the nominees. However, in the event that any of them should be unable to serve, the proxy holders named on the proxy cards will vote in their discretion for such persons as the Board may recommend.

There are no family relationships among directors or executive officers of the Company. As of the date hereof and for the past five years, no directorships are held by any director or director nominee with a company with a class of securities registered pursuant to Section 12 of the Exchange Act, or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940, except for Director Earl E. Fry, who is a director of Backblaze Inc. (NASDAQ ticker “BLZE”), and was a director of Hawaiian Holdings, Inc. (former NASDAQ ticker “HA”) from 2016 to 2024, up until merger with and into Alaska Air Group, Inc.; Director A. Catherine Ngo, who is a director of Maui Land & Pineapple Company, Inc. (NYSE ticker “MLP”); Director Crystal K. Rose, who was a director of Hawaiian Holdings, Inc. (former NASDAQ ticker “HA”) from 2006 to 2024, up until its merger with and into Alaska Air Group, Inc.; and Director Paul K. Yonamine, who is a director of Seven & i Holdings, Co., Ltd. (Tokyo Stock Exchange ticker “3382.T”) and was a director of Circlace Co., Ltd. from 2020 to 2023 (Tokyo Stock Exchange ticker “5029.T”).

The election of directors requires a plurality of the votes cast “FOR” the election of the directors by the shares entitled to vote in the election at a meeting at which a quorum is present. Accordingly, the 12 directorships to be filled at the Meeting will be filled by the 12 nominees receiving the highest number of “FOR” votes. There is no cumulative voting in the election of directors.

We are pleased to propose 12 director nominees for election this year. We believe that our director nominees, individually and collectively as a group, possess the requisite experience, qualifications, skills, diversity, and mix of institutional knowledge and fresh perspectives necessary to maintain an effective Board to serve the best interests of the Company and its shareholders. All nominees are incumbent directors and are deemed “independent” except for Arnold D. Martines, who is the current Chairman, President and Chief Executive Officer of the Company, A. Catherine Ngo who is the former Executive Vice-Chair of the Company, and Paul K. Yonamine who is the former Chairman and Chief Executive Officer of the Company.

Our Board, which currently has 12 members, recognizes the value of Board refreshment and has added a new independent director in each of 2021 (Jonathan B. Kindred), 2023 (Jason R. Fujimoto), 2024 (Robert K.W.H. Nobriga) and 2025 (Diane S.L. Paloma). In addition, three of our longer serving directors departed the Board in 2023 and 2024: Colbert M. Matsumoto retired from our Board in 2023, after having served 19 years; Christine H. H. Camp resigned in 2024 for personal reasons, after having served 20 years; and Duane K. Kurisu retired from our Board in 2024, after having served 16 years. Our Board has set the number of directors that will constitute our Board, effective as of the Meeting, at 12. Our Governance Committee and Board are committed to maintaining and enhancing our Board’s diversity of backgrounds, experience and skills in an effort to align our Board’s composition with the diverse customers and communities we serve.

 

 

The below provides information regarding the nominees to our Board, including certain types of knowledge, experience or attributes we believe is possessed by one or more of our director nominees.

 

 

* No directors identify as LGBTQ+ or non-binary, and all directors disclosed demographic background and gender identity.

The following table summarizes the specific skills and professional experience of each director nominee that led the Company’s Governance Committee and Board to determine that each such person should serve on the Board.

 

 

The biographies below describe the business experience (including principal occupation for the past five years), directorships, and qualifications of each of our director nominees and our executive officers. All directors and executive officers of the Company are also directors and executive officers of the Bank. In connection with each nominee’s re-election to the Board, the director nominees will also be re-elected to the board of the Bank.

Set forth below is information concerning the current executive officers of the Company who are not also directors of the Company:

During the fiscal year ended December 31, 2024, the Board held a total of eight regular meetings and 10 special meetings. Each incumbent director attended at least 75% of the total number of the aggregate of the Board meetings and meetings held by all committees of the Board on which he/she served during 2024. The Company expects directors to attend the annual meeting of shareholders. 11 of our 12 then serving directors attended last year’s annual meeting of shareholders.

The Board’s “Director Resignation Policy” provides that at any shareholder meeting at which directors are subject to an uncontested election, any nominee for director who receives a greater number of votes “withheld” from his or her election than votes “for” such election shall tender a letter of resignation to the Board for consideration by the Governance Committee. The Governance Committee shall recommend to the Board the action to be taken with respect to such offer of resignation. The Board shall act promptly with respect to each such letter of resignation and shall notify the director concerned of its decision. Any director who tenders his or her resignation pursuant to this provision shall not participate in the Governance Committee or Board action regarding whether to accept his or her resignation offer.

The Board’s “Corporate Governance Guidelines” provide that a non-employee Director must retire from the Board as of the first annual meeting of shareholders that occurs after the Director attains the age of 70. As a result, such director will not be renominated for election as a director.

The Board’s “Corporate Governance Guidelines” provide that no Director will be permitted to serve on more than two other public company boards in addition to the Company’s Board unless such Director obtains the approval of the Governance Committee.

The Company’s Board has no policy with respect to the separation of the offices of Chair, President and Chief Executive Officer. It is the Board’s view that rather than having a rigid policy, the Board, with the advice and assistance of its Governance Committee, and upon consideration of all relevant factors and circumstances, will determine, as and when appropriate, whether the offices of Chair, President and Chief Executive Officer should be separate. Arnold D. Martines currently serves as President and Chief Executive Officer of the Company and the Bank, and as Chair of the Company’s and the Bank’s Board of Directors. The Board has determined in 2024 that combining the offices of Chair, President and Chief Executive Officer is most appropriate at this time to best facilitate communication, alignment, and achievement of the Company’s strategic objectives. Since June 1, 2014, Crystal K. Rose has served as Lead Independent Director and as a member of the Governance Committee of the Company’s and the Bank’s Board of Directors. Ms. Rose previously served as Chair of the Board of Directors of the Company and the Bank from April 20, 2011 through May 31, 2014 and Chair of the Governance Committee of the Company’s and the Bank’s Board of Directors from June 1, 2014 through April 1, 2019. 9 of the current 12 members of the Company’s and Bank’s Board of Directors are “independent” directors as defined under applicable NYSE guidelines.

As the Board’s former Chair and now as its Lead Independent Director, Ms. Rose previously presided over and once again presides over all meetings of the independent directors in executive sessions, acts as liaison and facilitates communications between the Board and the principal executive officers, and ensures independent Board governance and oversight of management. In addition, all members of the Board’s Audit Committee, Compensation Committee, and Governance Committee are comprised of independent, non-management directors. The Company believes that the current structure ensures sufficient Board independence from management while also optimizing the efficiency and effectiveness of the Board and management in the oversight of the Company and the Bank, and also supports and provides for orderly transition and succession.

The Company is a one-bank holding company, with the Bank being the Company’s only bank subsidiary. The Company was set up as the Bank’s holding company to capitalize on the benefits of a bank holding company structure, including potential tax advantages, ability to engage in stock repurchases, potential flexibility with respect to activities and capital raising. All of the directors on the Company’s Board also serve on the Bank’s Board of Directors. In addition, all of the Company’s directors who serve on the Company’s Audit Committee, Compensation Committee, Governance Committee, and Board Risk Committee also serve on those same board level committees at the Bank.

Director Qualifications. The Governance Committee is responsible for reviewing the qualifications and independence of director nominees in accordance with its charter and the criteria set forth in the Company’s Corporate Governance Guidelines. The general criteria considered include independence, character, diversity, age, skills, financial literacy, experience and other relevant considerations in the context of the needs of the Board. Diversity is an important factor in consideration of director nominees. Diversity

is viewed in a broad context; we seek Board members from different professions, industries, backgrounds, experiences, cultures, ethnicities, races, gender identities, geographies, and other professional and personal characteristics who can represent the business and industry sectors that support Hawaii’s economy, and Hawaii’s multi-cultural, multi-ethnic, and multi-racial population and community.

Identifying and Evaluating Nominees. The Board seeks to identify candidates for director positions that are best qualified and suited to meet the needs of the Company and to present these candidates for shareholder approval. The Governance Committee will first identify, review, evaluate and recommend to the Board, nominees for director positions. The Board will then vote whether or not to recommend such nominees to the Company’s shareholders for election. In identifying potential director nominees, the Governance Committee will search within the State of Hawaii and may search outside the State of Hawaii for any potential director candidates, and in this regard, may utilize the services of a professional search firm. While the same general criteria set forth above shall be applied in evaluating a candidate’s qualifications, it is difficult to enumerate all of the attributes, skills and qualities that the Governance Committee and/or Board may, at any given point in time, determine, consider and value in evaluating, selecting and recommending director nominees. Accordingly, the Governance Committee and the Board exercise their discretion and consider any circumstances, experiences, attributes, skills, qualities, and factors applicable to any director nominee with the intent and purpose of having the best qualified and suited directors serving on the Board at all times, as well as ensuring that the Board as a whole is diverse and well rounded. The Board may enlist the services of a third-party to conduct a background check or other investigation in order to determine whether a candidate meets any criteria.

The Governance Committee tracks the average director tenure and maintains a record of current director background, skills, experience to identify any gaps on the Board (including diversity gaps), and maintains a list of potential future independent director candidates to maintain a balance of director skills, diversity and tenure on the Board.

Shareholder Nominees. In accordance with the policies set forth in the Company’s Corporate Governance Guidelines and the Company’s Bylaws (as amended), the Governance Committee will consider properly submitted director nominees for election at the 2026 Annual Meeting of Shareholders recommended by shareholders if such recommendations are received in writing not less than 90 calendar days nor more than 120 calendar days prior to the first anniversary date of the annual meeting for the preceding year (such anniversary date, April 24, 2026), and comply with all other applicable requirements set forth in said Corporate Governance Guidelines and Bylaws (as amended). Shareholder recommendations should be addressed to the Company’s Corporate Secretary, P.O. Box 3590, Honolulu, Hawaii 96811. In addition, shareholders may bring nominations directly before an annual meeting by giving timely notice in writing to the Company’s Corporate Secretary within the same 90 to 120 calendar day period prior to the first anniversary date of the annual meeting for the preceding year (such anniversary date, April 24, 2026) and complying with all other applicable requirements set forth in the Company’s Bylaws. In addition to satisfying the foregoing requirements under the Company’s bylaws, to comply with the universal proxy rules, shareholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than February 23, 2026.

The Governance Committee leads annual evaluations of Board, Committee and individual director performance. The evaluation process is designed to facilitate ongoing, systematic examination of the Board’s and Committee’s effectiveness and accountability, and to identify opportunities for improving operations and procedures. The process includes a third-party-platform which supports anonymized responses from directors, to ensure honest responses.

The Board has four standing committees: Audit Committee, Compensation Committee, Governance Committee, and Risk Committee. All chairs of our four standing committees are independent and appointed annually by the Board upon the recommendation of the Governance Committee. Each chair presides over committee meetings, oversees meeting agendas, serves as a liaison between the committee members and the Board, as well as between committee members and senior management, and works actively and closely with senior management on all committee matters, as appropriate.

Each of the four standing committees meets regularly. The committees, typically through their committee chairs, routinely report their actions to, and discuss their recommendations with, the full Board. In addition, certain committees periodically hold extended meetings dedicated to discussing key strategic matters or other business items that are relevant or subject to the committee’s oversight responsibilities on a more in-depth basis.

The Board has adopted a written charter for each of these committees, which are available, together with other corporate governance documents at: ir.cpb.bank/corporate-overview/corporate-governance. The Audit Committee, Compensation Committee, and Governance Committee of the Board are comprised solely of independent directors. The names of the current members (chairs specifically noted) and highlights of some of the key oversight responsibilities of each Board committee are set forth below.

From time-to-time, the Compensation Committee seeks advice from outside experts in the compensation field. The Compensation Committee has historically engaged a compensation consultant to provide input on both Board and executive compensation issues. In 2024 the Committee retained Pay Governance LLC (“Pay Governance”). Pay Governance is an independent firm that serves as a trusted advisor on executive compensation matters to boards and compensation committees.

In 2024, Pay Governance was engaged directly by the Compensation Committee and reported directly to the Compensation Committee for its services in this capacity. The Compensation Committee discusses, reviews, and approves all consulting projects performed by Pay Governance and periodically reviews the relationship with Pay Governance, and considers competitive proposals from other firms.

The Compensation Committee considered the independence of Pay Governance in light of SEC rules and NYSE listing standards. The Compensation Committee requested and received reports from Pay Governance addressing its independence and the independence of its consultants, including the following factors: (1) other services provided to the Company by Pay Governance (none); (2) fees paid by the Company as a percentage of Pay Governance’s total revenue; (3) policies or procedures maintained by Pay Governance that are designed to prevent a conflict of interest; (4) any business or personal relationships between Pay Governance and a member of the Compensation Committee (none); (5) any Company Common Stock owned by Pay Governance (none); and (6) any business or personal relationships between our executive officers and Pay Governance (none). The Compensation Committee discussed these considerations as well as other considerations and concluded that the work performed by Pay Governance and its consultants, involved in the engagement did not raise any conflict of interest.

The Board oversees various risks of the Company and the Bank at both the Board level and through Board Committees where risk pertains to a particular committee responsibility. The Board oversees the Company’s and the Bank’s risk management as applied to major new initiatives and with respect to ongoing business operations and activities. The Chief Executive Officer, Chief Risk Officer and other executive officers, with the Board’s approval, sets the Company’s and the Bank’s overall risk appetite, which is incorporated within the Company’s and the Bank’s Strategic Plan and guides decision-making. The Board and Board Committees are kept informed of the Company’s and the Bank’s business and risk profile through various reports provided to them on a regular basis at Board and Committee meetings by the Company’s and the Bank’s executive officers and other leadership.

Cyber security is an important component of the Company’s risk management strategy. As a bank holding company, the Company is committed to safeguarding the confidentiality and integrity of the sensitive data we handle. The Company maintains a formal and comprehensive information security program that protects the confidentiality, integrity, and availability of the Company’s information assets including information technology systems, and confidential and customer information. The information security program, which is in compliance with banking regulations, includes a threat intelligence program, policies and procedures, multi-layered cybersecurity technical safeguards, third-party security risk assessments, a formal incident response program, mandatory trainings for employees and independent contractors upon hire and regularly thereafter, annual audits, and reviews of vendors who handle sensitive information. The Board of Directors overall, including the Board Risk Committee more specifically, oversees cyber security risk. The Executive Committee overall, and the Chief Risk Officer, Chief Legal Officer, Chief Technology Officer, and Director of Information Security more specifically, manages cyber security risk and the associated programs at the operational level. The Board reviews and approves the Company’s information security program at least annually, and the Board Risk Committee receives regular updates from the Company’s Director of Information Security and Chief Technology Officer regarding cyber/information security matters, including the Company’s cyber security posture, program efficacy, program efforts, key trends affecting cyber/information security matters, and the relevant risks posed to the Company. Three directors, two of whom are on the Board Risk Committee, have technology expertise and experience. At the management level, the Company’s Director of Information Security and Chief Technology Officer each report regularly to the Management Risk Committee. The Management Risk Committee oversees information/cyber security risks at the Bank level to ensure that these risks are identified, measured, managed, monitored, and reported in alignment with the Bank’s risk appetite. The Company has incident response plans to enable immediate, efficient and effective response to cyber incidents. For more information, please see Item 1C of the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2024.

The Board has determined, in accordance with our Standards Regarding Director Independence, that all directors and nominees are “independent” within the meaning of the rules of the NYSE, except for Directors Arnold D. Martines, Paul K. Yonamine, and A. Catherine Ngo. Director Arnold D. Martines is currently serving as the Chairman, President and Chief Executive Officer of the Company and the Bank and is thus non-independent. Directors Paul K. Yonamine and A. Catherine Ngo both ceased serving as executive officers of the Company and the Bank effective January 1, 2023 and ceased being employed by the Bank effective January 31, 2025 and December 31, 2024, respectively; however they remain classified as non-independent under NYSE rules because three years have not yet elapsed from their having been employed by the Bank. Director Paul K. Yonamine previously served as Chairman and Chief Executive Officer of the Company and Executive Chairman of the Bank. Director A. Catherine Ngo previously served as President and Chief Executive Officer of the Company and the Bank. All of the directors and nominees (other than Mr. Martines) are non-employees. The Audit Committee, Compensation Committee, and Governance Committee of the Board are comprised solely of independent directors.

With respect to those directors who were determined independent by the Board, the following transactions, relationships and arrangements were considered by the Board in its determination of a director’s independence, including with respect to service on the Board’s committees, and none were found to adversely impact an independence determination.

Independent directors either directly and/or indirectly through companies in which they have a business interest or affiliation, or through members of their immediate families, maintain banking relationships (including deposits and/or loans) with the Bank in the ordinary course of business.

The Bank and Central Pacific Bank Foundation made charitable contributions to entities affiliated with our independent directors. The indirect interest of the independent director in the charitable contribution was found to be immaterial and in amounts that do not impair the independence of the relevant director under our Standards Regarding Director Independence and the NYSE’s corporate governance listing standards. In 2024, the Company did not pay to any charitable or non-profit organization in which one of our independent directors serves on that organization’s board, any amount in excess of the greater of $1,000,000 or 2% of the recipient’s gross revenues. The aggregate amount of these charitable donations in 2024 was approximately $50,000.

During 2024, the following independent directors and nominees served on boards and as officers of companies that either directly or indirectly had business relationships with the Bank in the ordinary course of the Bank’s business, in which the directors had no involvement and which were on no more favorable terms than for other similarly situated matters: Paul J. Kosasa, Robert K.W.H. Nobriga, and Diane S.L. Paloma. All amounts involved were less than 1% of the annual gross revenue of each of the Company and the other entity involved, and none of the services involved were professional, consulting or advisory services. Each director had no involvement with the business relationship with the Bank, and all related contracts are based on market terms and not made on favorable or preferential terms.

Company director Paul J. Kosasa is President and Chief Executive Officer of ABC Stores. ABC Stores has over 70 retail convenience stores in Waikiki and other tourist locations in Hawaii, Guam, Saipan and Las Vegas, Nevada. In 2024, the Bank paid a total of $22,172 to place eight ATMs in eight ABC Stores in Hawaii. While this business arrangement is beneficial to both the Bank and ABC Stores, it is not financially significant or material to either ABC Stores’ or CPB’s business, and such arrangement is historical and the parties are not intending to expand such ATM arrangement. ABC Stores has 75 stores and CPB has 55 ATMs. Mr. Kosasa had no involvement with the Bank’s ATM contracts with ABC Stores, such contracts do not have any material financial impact on either ABC Stores or the Company, such contracts are not for professional, consulting or advisory services, and such contracts are based on market terms and not made on favorable or preferential terms to ABC Stores.

Company Director Robert K.W.H. Nobriga is President and Chief Executive Officer of Tradewind Group, Inc. (“Tradewind”). Atlas Insurance Agency, Inc. (“Atlas”), Island Insurance Company, Limited (“Island Insurance”), Tradewind Insurance Company, Limited (“Tradewind Insurance”), and Hoike Networks, Inc. (“Hoike”) are all subsidiaries of Tradewind. Mr. Nobriga is Chairman of the Board of Directors of Atlas and Hoike, Vice Chairman of the Board of Directors of Island Insurance, and a director on the Board of Directors of Tradewind Insurance. In 2024, Atlas provided insurance agency services to the Company and received $232,400 in commissions. In 2024, the Company paid $2,950 and $14,846 to Island Insurance and Tradewind Insurance, respectively for corporate insurance policies. Hoike provided certain information technology technical support services, and third-party software, services and equipment, to the Company and received $195,372. Mr. Nobriga is an employee of Tradewind and does not have any ownership in any of the aforementioned companies. The Company has been a customer of Atlas since 2000 (decades before Mr. Nobriga became a Board member of the Company and before Mr. Nobriga became an executive at Tradewind) and Atlas which was founded in 1929 is the largest insurance agency in Hawaii. The Company has engaged the aforementioned companies for many years due to their superior quality and value and given limited insurance agency alternatives in Hawaii’s very small and geographically isolated island market. Mr. Nobriga had no involvement respecting the Company’s procurement of any of the aforementioned products and services, the cost of such products and services does not have any material financial impact on the Company or the other aforementioned companies, such

products and services are not for professional, consulting or advisory services, such products and services were contracted for on market terms and not made on favorable or preferential terms, and the amounts do not exceed $1,000,000 and do not exceed 1% of the consolidated gross revenues of Tradewind. Lastly, Mr. Nobriga’s wife, Joyce Nobriga, is the Chief Financial Officer and Controller of Waialae Country Club, a non-profit private membership club in Honolulu which hosts the Sony Open in Hawaii golf tournament. In 2024, the Bank paid Waialae Country Club $26,908 for food, beverage and catering services related to a dinner hosted at the club and food and beverage for a marketing tent at the Sony Open in Hawaii golf tournament. Mr. Nobriga had no involvement with the Bank’s decision to host events at Waialae Country Club, the amount of money involved does not have any material financial impact on either Waialae Country Club or the Company, and such purchases were based on market terms and not made on favorable or preferential terms.

Company Director Dr. Diane S.L. Paloma is President and Chief Executive Officer of Hawaii Dental Service (“HDS”). HDS was founded in 1962 and is a Hawaii nonprofit dental service corporation which is the leader in the State of Hawaii in providing dental plans. HDS serves nearly 70% of all Hawaii residents and nearly 95% of all licensed practicing dentists in Hawaii participate with HDS. HDS has been the Bank’s dental plan provider to the Bank’s employees for more than 25 years. Hawaii companies and employers have limited and few choices and alternatives insofar as dental plan providers and HDS is superior in quality and value to all other dental plan providers. HDS has consistently been the best option for dental benefits for the Bank’s employees, to include respecting cost, benefits, and a very large participating network of dentists. In 2024, the Bank and its participating employees paid a total of $390,000 to HDS for the Bank’s employee dental plan. Dr. Paloma has no involvement respecting the Bank’s negotiation of the Bank’s dental plan with HDS. With the assistance of the Bank’s external benefits consultant, the Bank reviews its dental plan annually, including considering other dental providers, to ensure such plan is at market rates and terms. The Company and Bank do not give any preferential treatment or terms to HDS. HDS does not provide the Company or the Bank with any professional, consulting, advisory or other services. The cost of the Bank’s dental plan with HDS is well under $1,000,000 and well under 1% of the consolidated gross revenues of HDS and the Company.

Mr. Patrick Matsumoto, the husband of Company Executive Vice President and Chief Financial Officer Ms. Dayna Matsumoto, has been employed by the Bank since 2012 and currently holds the position of Vice President, Commercial Real Estate Manager, a non-executive officer position. In 2024, Mr. Matsumoto’s total compensation, including salary, bonus, equity awards, and other benefits, totaled approximately $177,000. Mr. Matsumoto participates in the Company’s general benefit plans available to all similarly situated employees. His compensation is commensurate with that of his peers and Ms. Matsumoto does not have input into Mr. Matsumoto’s compensation. Mr. Matsumoto does not report directly or indirectly to Ms. Matsumoto.

See “Director Independence and Relationships” for additional information regarding certain relationships and related transactions.

The Bank, which is a wholly owned subsidiary of the Company, has made loans to directors and executive officers, their immediate family members, and companies in which they or their immediate family members have an interest, in the ordinary course of its business as a bank. These loans were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with persons not related to the Bank and do not involve more than the normal risk of collectability or present other unfavorable features. As of the date of this Proxy Statement, all of these loans are pass-rated loans.

The Company has a Board approved written policy (“Policy Regarding Transactions with Related Persons”) which sets forth the process and procedures for the review, approval, ratification and disclosure of any transactions with a related person (“transaction” and “related person” being as defined by Item 404 of SEC Regulation S-K). Loans subject to the lending restrictions set forth in Federal Reserve Board Regulation O are reviewed and approved by the Bank’s Board. All other loans to related persons are reviewed by the Bank’s Management Loan Committee and reported to the Audit Committee when up for credit approval or renewal. All other transactions with related persons are reviewed by the Company’s Audit Committee. Each director and executive officer is required to report to the Company transactions with the Company in which they have an interest.

The Company is committed to promoting and fostering ethical conduct and sound corporate governance principles. The Company has a Code of Conduct & Ethics (the “Code”) applicable to all employees, officers and directors of the Company. In addition, the Company also has a supplemental Code of Conduct & Ethics for Senior Financial Officers, which is applicable to the Chief Executive Officer, President, Chief Financial Officer, Controller, any other principal financial officer or principal accounting officer and any other person fulfilling and/or performing any similar role, function or capacity. Both of the aforementioned Codes of Conduct & Ethics are available on the Company’s website (www.cpb.bank) and Company employees annually certify that they have read and understand the Code or

codes applicable to them. The Code provides standards of conduct and ethics in order to preserve, promote and foster the highest ethical conduct among all employees, officers and directors of the Company, and addresses conflicts of interest, corporate opportunities, honesty and integrity, securities trading, fair dealing, confidentiality, protection and proper use of Company assets, and encourages the reporting of any suspected violation of the Code through robust reporting protocols and whistleblower protections. The Company also maintains a strong whistleblower and anti-retaliation policy and encourages reporting in accordance with the Company’s Complaint Policy available on the Company’s website (www.cpb.bank), which provides several designated channels, including to the Company’s Chief People Officer, Director of Internal Audit and Credit Review, Chief Legal Officer, Chief Executive Officer, President or Board of Directors, or through a third-party hosted anonymous alert line. A waiver or amendment of any provision of the Code or supplemental Code of Conduct & Ethics for Senior Financial Officers may be made only by the Board. Any amendment or waiver of the supplemental Code of Conduct & Ethics for Senior Financial Officers will be posted on the Company’s website (www.cpb.bank) within four business days of such amendment or waiver, as the case may be. In addition, the Bank has a Sexual Harassment & Other Forms of Harassment Policy which specifically addresses sexual harassment, other forms of harassment, investigation procedures, discipline, confidentiality, and prohibition of retaliation.

Pursuant to the Company’s Stock Trading Policy, directors and employees (including executive officers) are prohibited from trading in the Company’s stock (including buying, selling, gifts or other dispositions) while in possession of material non-public information about the Company or otherwise during customary (or specially imposed) stock blackout periods corresponding to the Company’s disclosure of information relating to the Company’s periodic financial results. The Company similarly adheres to the same insider trading restrictions when purchasing its own stock pursuant to its publicly announced stock repurchase plans.

The Company Stock Trading Policy further prohibits directors and employees (including executive officers) from hedging the risk associated with the ownership of the Company’s stock. This prohibition would include any purchase of financial instruments (including put or call options or any other derivative instruments) which function as a hedge on the Company’s stock. The Company Stock Trading Policy also prohibits directors and employees (including executive officers) from pledging transactions involving the Company’s stock as collateral, including the use of a traditional margin account with a broker-dealer, without the prior consent of the Company’s Legal Department.

Our management team regularly attends investor conferences and meets with our investors and investor prospects throughout the year. In 2024, our management team attended the Piper Sandler bank conference in Las Vegas in February 2024 and Raymond James bank conference in Chicago in September 2024, and also met with investors and prospective investors in Saint Louis and Los Angeles in September 2024. In November 2024, our management team met with investors and investor prospects virtually. Meetings with investors and investor prospects totaled 25 and 21, respectively. Topics discussed focused on the Company’s business and management, and the Hawaii economy.

Shareholders and other interested parties who wish to communicate with us on these or other matters may contact us electronically at [email protected] or by mail at Investor Relations, Central Pacific Financial Corp., P.O. Box 3590, Honolulu, Hawaii 96811.

Shareholders of the Company and others may send written communications directly to the Board, addressed to: Board of Directors of Central Pacific Financial Corp., 220 South King Street, 22^nd Floor, Honolulu, Hawaii 96813. Any such communication may be directed to the attention of the Chair of the Board or the Chair of any Board Committee (such as, for example, the Chair of the Audit Committee or the Chair of the Governance Committee) or to the Lead Independent Director or to the non-management or independent directors. Shareholders and others sending such communications should include the following in their written communication: (a) such shareholder(s) and others should identify himself/herself/itself/themselves, and if a shareholder, provide reasonably satisfactory proof of their ownership of the Company’s Common Stock; (b) such shareholder(s) and others should state in reasonable detail and communicate with reasonable clarity and specificity their issue or concern; and (c) such shareholder(s) and others should include their contact information (at a minimum, phone number and address). Shareholders and others who wish to communicate anonymously with the Board or any group of the Board should refer to the Company’s Complaint Policy available on the Company’s website (https://ir.cpb.bank/corporate-overview/corporate-governance/default.aspx). However, nothing that is stated in this paragraph shall override any requirements imposed on any shareholder communications under the Company’s Articles of Incorporation (as amended) or Bylaws (as amended) or other governing documents or by any law, rule or regulation.

We believe that a commitment to sound corporate governance practices, including social, environmental, and economic responsibility, is important to the Bank’s success. As such, we are committed to integrating ESG considerations into our business practices and operations. Our priority is to mitigate risk and improve performance, while optimizing the positive impact on our business, society and the environment.

For more details regarding our commitment to ESG, you may visit the “CPB x ESG: Caring for our Aina and People” tab of our “Investor Relations” page at www.cpb.bank and our forthcoming 2024 Caring for our ‘Aina and People Report, which you will find on that page upon its publication.

Environmental: Our Board and management are focused on environmental issues, including the impacts of natural events (such as sea-level rise, major storms, flooding, wildfires, and increasing temperatures) on our business, customers and communities. We are working with other business leaders in Hawaii to address natural events collectively, as Hawaii is at significant environmental risk from oceanic and atmospheric conditions. We are also working to assess the risks of natural events and sea-level rise to our business, including with respect to operations, customers, investments and loan portfolios, and taking sustainability into account in future business plans.

Social: Since the Company’s and the Bank’s founding, we have been committed to serving the communities in which we operate. This support includes a focus on supporting small businesses, providing digital banking alternatives for customers, support of home ownership including investments in affordable housing projects, charitable contributions, employee volunteerism, and the activities of the Central Pacific Bank Foundation.

Governance: We believe that strong corporate governance shepherded by our Board drives trusted and transparent business practices, intelligent risk management, and long-term sustainability for the Company and Bank. This leadership, combined with effective strategies and policies, contributes to our culture of high ethics, integrity, and compliance. For more information regarding our governance practices, see the “Election of Directors” and “Corporate Governance and Board Matters” sections of this Proxy Statement.

Talent Management: We strive to be a caring employer of choice, supporting our employees’ success and well-being with programs that focus on professional development and overall well-being. We are committed to providing a safe and positive work environment where employees are engaged and work together toward shared organizational goals. We support flexible working arrangements with our employees, subject to certain standards and criteria which we may impose.

Board: The Board has the ultimate responsibility for oversight of the Company’s and the Bank’s ESG program. The Board regularly receives reports on ESG, considers environmental, health and safety, and social matters as part of its oversight functions, and has incorporated ESG related initiatives into the Company’s 2025 Strategic Plan and Business Plan.

Board Risk Committee: Our Board Risk Committee has formal oversight of our ESG program, initiatives, and reporting. The Board Risk Committee receives regular updates from management on the status and activities of the Company’s and the Bank’s ESG initiatives.

Management Risk Committee: The Management Risk Committee oversees ESG risks at the Bank level to ensure that these risks are identified, measured, managed, monitored, and reported in alignment with the Bank’s risk appetite, consistent with appropriate risk/reward returns, and in support of the Bank’s strategic and business objectives. The Company’s and the Bank’s Chief Risk Officer was hired in 2024 to oversee, among other matters, Company’s and Bank’s enterprise risk, and chairs the Management Risk Committee.

Since 2021 the Company and the Bank has released an annual Environmental, Social and Governance Report (“ESG Report”) and disclosures in accordance with the Sustainability Accounting Standards Board (“SASB”) Commercial Banks, Mortgage Finance, and Consumer Finance Sustainability Accounting Standards. These reports, as well as other ESG related disclosures are available on our “Investor Relations” page at www.cpb.bank.

Our ESG Reports and other ESG related disclosures highlight our commitment to strong corporate governance, transparent business practices, intelligent risk management, being a leader in supporting our community, recruiting and retaining a diverse workforce with an ongoing commitment to the health, well-being and success of those employees, and attention to environmental stewardship and sustainability.

Information on our website and in our ESG Report and ESG related disclosures are not part of or incorporated into this proxy statement.

The following Report of the Audit Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filings under the United States Securities Act of 1933, as amended, or under the United States Securities Exchange Act of 1934, as amended, except to the extent we specifically incorporate this Report by reference.

The Audit Committee’s primary purposes are to: (a) assist the Board in its oversight of (i) the integrity of the Company’s financial statements, (ii) the Company’s compliance with legal and regulatory requirements, (iii) the Company’s independent auditors’ qualifications and independence, and (iv) the performance of the Company’s internal audit function and independent auditors; (b) decide whether to appoint, retain or terminate the Company’s independent auditors and to pre-approve all audit, audit-related and other services, if any, to be provided by the independent auditors; (c) review certain related party transactions; and (d) prepare this Report. The Board has determined, upon the recommendation of the Governance Committee, that each member of the Audit Committee is “independent” within the meaning of the rules of the NYSE and the SEC. The Board has also determined that each member is “financially literate” and has “accounting or related financial management expertise,” as such qualifications are defined under the rules of the NYSE, and that each member is an “audit committee financial expert” within the meaning of the rules of the SEC. The Audit Committee is established in accordance with Section 3(a)(58)(A) of the United States Securities Exchange Act of 1934, as amended. All non-audit services performed by the independent auditor must be specifically pre-approved by the Audit Committee or a member thereof.

Management is responsible for the preparation, presentation and integrity of the Company’s financial statements, accounting and financial reporting principles and the establishment and effectiveness of internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. The independent auditors are responsible for performing an independent audit of the financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), expressing an opinion as to the conformity of such financial statements with generally accepted accounting principles and auditing the effectiveness of internal control over financial reporting. The independent auditors have free access to the Audit Committee to discuss any matters they deem appropriate.

In performing its oversight role, the Audit Committee has reviewed and discussed the audited financial statements with management and the independent auditors. The Audit Committee has also discussed with the independent auditors the matters required to be discussed by the applicable requirements of the PCAOB and the SEC. In addition, the Audit Committee has received the written disclosures and the letter from the independent auditor required by applicable requirements of the PCAOB regarding the auditors’ communications with the Audit Committee concerning independence, and has discussed with the independent auditor the independent auditors’ independence.

During 2024, the Audit Committee performed all its duties and responsibilities under the Audit Committee Charter. In addition, based on the reports and discussions described in this Report, the Audit Committee recommended to the Board that the audited financial statements of the Company for the fiscal year ended December 31, 2024 be included in the Company’s Annual Report on Form 10-K for such fiscal year.

Respectfully submitted by the members of the Audit Committee of the Board as of February 25, 2025:

Jonathan B. Kindred, Chair

Earl E. Fry

Jason R. Fujimoto

In October 2024, the Compensation Committee engaged Pay Governance to conduct an annual review of Board compensation. Our Board pay competitiveness was assessed relative to two peer groups. One peer group included peers used for executive compensation benchmarking and the other peer group reflected companies in the local Hawaii market. Based on the study results the Board’s compensation structure and Committee Chair retainers were determined to be aligned with peers and did not require adjustments. Details on what each Director received in fees for 2024 are outlined below in the “Annual Retainer” section.

All non-employee directors are paid an annual retainer in cash and/or Common Stock or credit for a hypothetical investment in shares of Common Stock under the Director Deferred Compensation Plan. Payments were made or credited in May 2024. Details on annual retainers paid to directors, as well as to Chairs of our committees, are as follows:

The following table shows for the year ended December 31, 2024, compensation paid to our directors who served on the Board during 2024. Non-employee directors are typically paid in May of the year for their service on the Board through the next annual shareholders meeting.

 

Directors of the Company and the Bank are eligible to participate in the Company’s 2013 and 2023 Stock Compensation Plans. As noted above, portions of the non-employee directors’ compensation were paid in Common Stock under the 2023 Stock Compensation Plan. The 2013 Stock Compensation Plan remains active for the sole purpose of issuing stock pursuant to outstanding performance stock units and restricted stock units that have yet to vest. Ms. Ngo and Mr. Yonamine have outstanding performance stock units and restricted stock units under the 2013 Stock Compensation Plan vesting on February 15, 2025.

The Company maintains a Directors Deferred Compensation (DDC) Plan under which each non-employee director of the Company and the Bank may elect to defer all or a portion of his or her annual retainer. The DDC Plan is managed by a third-party administrator, The Pangburn Group, which was selected by the directors. Under the DDC Plan, a participating director may elect from various payment alternatives, but full payout must occur no later than the tenth anniversary of separation from service as a director. Under the DDC Plan, deferred amounts are valued based on the performance of certain investment funds offered by the DDC Plan administrator. No plan earnings are considered to be “above-market” or “preferential” and as a result no amounts are reported in the Director Compensation table. The DDC Plan is a nonqualified deferred compensation plan under which distributions are made from the general assets of the Company under the direction and oversight of the Compensation Committee.

The following Compensation Committee Report does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filings under the United States Securities Act of 1993, as amended, or under the United States Securities Exchange Act of 1934, as amended, except to the extent we specifically incorporate this Report by reference.

The Compensation Committee has reviewed and discussed with executive management the Compensation Discussion and Analysis that immediately follows this report as required by Item 402(b) of SEC Regulation S-K. Based on such review and discussion, the Compensation Committee recommended to the Board that such Compensation Discussion and Analysis be included in the Proxy Statement and incorporated as referenced in our Annual Report on Form 10-K for the year ended December 31, 2024. Respectfully submitted by the members of the Compensation Committee of the Board who participated in the review, discussion, and recommendation.

Saedene K. Ota, Chair

Jason R. Fujimoto

Crystal K. Rose

The Compensation Committee of our Board of Directors (the “Committee”) intends this Compensation Discussion and Analysis (“CD&A”) to provide full, transparent disclosure of what we believe to be a thoughtfully designed compensation structure, which focuses on the achievement of short-term objectives and affirms the philosophy of rewarding for long-term shareholder value creation. This Compensation Discussion and Analysis discusses our 2024 executive compensation program, and more specifically as it relates to the following executive officers (below titles as of December 31. 2024):

We refer to these executives as our Named Executive Officers (“NEOs”).

Central Pacific Financial Corp. (the “Company”) is a Hawaii-based bank holding company with approximately $7.47 billion in assets as of December 31, 2024. Central Pacific Bank (the “Bank”), our primary subsidiary, is a full-service commercial bank offering a broad range of banking products and services, including accepting demand, savings and time deposits, and originating loans through the operation of 27 branches in the State of Hawaii.

Under the oversight of the Committee, our executive compensation program is designed to align total compensation with financial and business performance over the short-term and long-term.

With more than 85% of our loan portfolio business based in Hawaii and 100% of our operations managed in Hawaii, our success is linked to the strength and prospects of the Hawaii economy, along with factors impacting the banking industry as a whole. Among such factors for 2024 was a significant shift in the interest rate environment affecting investment portfolio positioning for us and our competitors. As a result of this and other unusual, non-recurring circumstances, our net income and efficiency ratio were adjusted for incentive compensation measurement purposes. We did not consider these investment portfolio transactions to be representative of the Company’s core operating performance for 2024.The adjustments to incentive performance measurements are further explained in “AIP Payouts”.

In 2024, due in large part to diligent oversight, we achieved meaningful net interest margin expansion and core deposit growth, along with strong asset quality and a decline in criticized assets. In addition, the investment portfolio repositioning will improve projected net interest income in the coming years.

Our branches on the island of Maui continue to serve valued customers who are still healing and striving to recover from the wildfires in 2023. While Maui still has a long way to go following its firestorm, rebuilding on the island is in progress. Job growth, visitor numbers and housing challenges continue. The good news is that there is cooperation and collaboration between government and the private sector to continue to achieve progress on an island that has gone through extraordinary challenges.

2024 was another year of accomplishment for the Bank as we continued to serve the personal, business and community needs of Hawaii. Paying homage to our Nisei roots, in February 2024, we launched a year-long 70th Anniversary brand campaign highlighting our long history of service to the community as well as profiling some of our long-time small business customers.

Our small business dominance continued in 2024 as the Bank once again swept the SBA Hawaii District awards ceremony securing more awards and recognition than any other local bank. In fact, underscoring our commitment to this market the Bank received three prestigious SBA Lender of the Year awards.

The Bank’s commitment to providing the latest products and services and exceptional service to its customers was once again recognized by both Forbes and Newsweek who named the Bank one of the best banks in Hawaii based on independent research. The Bank was also named best bank in Hawaii in 2024 by readers of the Honolulu Star-Advertiser.

The Company’s 2024 net income was $53.4 million, which declined by 9.0% compared to 2023. Additionally, ROA for 2024 was 0.72% as compared to 0.78% in 2023 and ROE for 2024 was 10.25% as compared to 12.38% in 2023.

Our earnings in 2024 were impacted by a pre-tax loss on sale of investment securities of $9.9 million related to investment portfolio repositioning, and $3.1 million in pre-tax expenses related to the Company’s evaluation and assessment of a strategic opportunity in 2024. Excluding these items, our adjusted net income (non-GAAP) was $63.4 million, our adjusted ROA (non-GAAP) was 0.86% and our adjusted ROE (non-GAAP) was 12.10% in 2024.

The Company ended the year with $7.47 billion in assets, compared to $7.64 billion a year ago. Total deposits declined by $203.6 million, or 3.0% from 2023, however, core deposits increased by $54.0 million, or 0.9% from the prior year. The year-over-year decrease in total loans of $106.1 million was led by a planned run-off of our consumer loan portfolio of $120.0 million.

Asset quality remained strong as nonperforming assets were 0.15% of total assets on December 31, 2024. Further, criticized assets declined to $32.8 million at the end of 2024, compared to $50.0 million as of the end of 2023. The 2024 provision for credit losses was $9.8 million, compared to a provision of $15.7 million in 2023.

Due to our strong capital position, we paid cash dividends in an annual amount of $1.04 per share in 2024, which remained unchanged from 2023. In 2024, we also repurchased 49,960 shares of Common Stock under our share repurchase program for $0.9 million compared to the repurchase of 130,010 shares of Common Stock for $2.6 million in 2023.

Significant highlights for the year ended December 31, 2024, were as follows:

During the year, the Company also made significant progress on longer-term strategic initiatives.

Our annual and long-term compensation programs are intended to recognize bank-wide performance and strong individual contributions and performance for 2024 and over the longer-term. Decisions were carefully considered by the Committee to allow us to remain competitive and continue to be able to attract, retain and motivate highly qualified and specialized talent to execute our go-forward strategy. Hawaii’s high cost of living/housing, competition for talent, and the need for competitive pay relative to local competition continue to be critical factors in our executive compensation decisions, and our compensation decisions for all Company employees. Total compensation for our executive team historically has been well below that of local Hawaii banks, presenting a risk to our business. We took steps starting several years ago to address this, and have continued to strengthen our position over the years. Below is a summary of the key components of our NEOs’ compensation.

Base Salary. In 2024, modest base salary increases for our NEOs ranged from 1.59% to 8.33% primarily based on market benchmarking (including relative to pay for our local Hawaii competition). See section below headed “Executive Compensation - Local Labor Market Considerations in Hawaii”, for details on local competitive benchmarking.

Annual Incentive Plan (“AIP”). Funding of our 2024 AIP is based on Net Income, Efficiency Ratio and Business Plan/NEO Personal Goals performance and is designed to motivate and reward achievement of Company performance, including both strategic and operational objectives. At overall threshold performance, AIP payout is 50% and at maximum performance, payout is 200%. Based on our (adjusted) 2024 performance, 2024 AIP payouts for our NEOs ranged from 91% to 94% of target.

Long-Term Equity Incentives. Our annual 2024 equity grants were made pursuant to our 2023 Stock Compensation Plan, with grants based on target grant values. The long-term equity awards granted to our NEOs in 2024 provide for one-half of the awards to be performance-based stock units (“PSUs”) and one-half to be time-based restricted stock units (“RSUs”). The PSUs are based on two performance metrics balanced between one-half of the PSUs to be earned based on Return on Equity (“ROE”), and the other one-half based on relative Total Shareholder Return (“rTSR”) compared to a group of industry peers. Based on our performance over the recently-completed performance cycle, the 2022-2024 PSUs paid out at 96.03% of target.

2024 Target Pay Mix. The charts below for Arnold D. Martines and our other NEOs illustrate the target compensation established for 2024, consisting of base salary, target annual incentive awards and target 2024 long-term equity awards (consisting of performance stock unit and restricted stock unit awards). For 2024, our compensation targets and pay mix were as follows:

 

In 2024, approximately 98% of the votes cast (for and against) were voted in favor of our named executive officer compensation. The Committee believes that the result of this vote is evidence that the Company's compensation policies and decisions are in the best interests of its shareholders.

The central principle of our compensation philosophy is that executive compensation should align with shareholders’ interests. Our executive compensation program is designed to: