DEF 14A 1 tm211559-1_def14a.htm DEF 14A tm211559-1_def14a - none - 13.349175s
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.           )
Filed by the Registrant ☒
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 14a6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under §240.14a12
PACWEST BANCORP
(Name of Registrant as Specified In Its Charter)
   
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee computed on table below per Exchange Act Rules 14a6(i)(1) and 011.
(1)
Title of each class of securities to which transaction applies:
   
(2)
Aggregate number of securities to which transaction applies:
   
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 011 (set forth the amount on which the filing fee is calculated and state how it was determined):
   
(4)
Proposed maximum aggregate value of transaction:
   
(5)
Total fee paid:
   

Fee paid previously with preliminary materials.

Check box if any part of the fee is offset as provided by Exchange Act Rule 011(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
(1)
Amount Previously Paid:
   
(2)
Form, Schedule or Registration Statement No.:
   
(3)
Filing Party:
   
(4)
Date Filed:
   

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NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS
You are cordially invited to attend PacWest Bancorp’s (“PacWest” or the “Company”) 2021 Annual Meeting (“Annual Meeting”) to be held virtually:
[MISSING IMAGE: tm211559d2-icon_cal.gif]   WHEN
    [MISSING IMAGE: tm211559d2-icon_mic.gif]   LIVE WEBCAST
    [MISSING IMAGE: tm211559d2-icon_record.gif]   RECORD DATE
Tuesday, May 11, 2021 1:00 p.m. Pacific time
www.virtualshareholdermeeting.com/PACW2021

You may vote if you were a
stockholder of record on the close
of business on March 15, 2021
Items of Business
1
Election of Directors. To elect 11 director nominees to the Board of Directors to service for a one-year term.

Tanya M. Acker

C. William Hosler

Robert A. Stine

Paul R. Burke

Susan E. Lester

Paul W. Taylor

Craig A. Carlson

Roger H. Molvar

Matthew P. Wagner

John M. Eggemeyer, III

Daniel B. Platt
2
Advisory Vote on Executive Compensation. To approve, on an advisory basis (non-binding), the compensation of the Company’s named executive officers.
3
Approval of the Amended and Restated PacWest Bancorp 2017 Stock Incentive Plan. To approve the Amended and Restated PacWest Bancorp 2017 Stock Incentive Plan.
4
Ratification of the Appointment of Independent Auditors. To ratify the appointment of KPMG LLP as the Company’s independent auditors for the fiscal year ending December 31, 2021.
5
Other Business. To consider and act upon such other business and matters or proposals as may properly come before the 2021 Annual Meeting or any adjournments or postponements thereof.
As of the date of this notice, the Board of Directors of PacWest (the “Board”) knows of no other matters that may be brought before stockholders at the Annual Meeting.
YOUR VOTE IS IMPORTANT. We appreciate you taking the time to vote promptly. You can access proxy materials at www.proxyvote.com. After reading the Proxy Statement, please vote at your earliest convenience by telephone, internet or, if you received printed proxy materials, by completing, signing and returning by mail a proxy card. In order to authorize your proxy via the Internet or by telephone, and to be admitted to the Annual Meeting at www.virtualshareholdermeeting.com/PACW2021, you
must have the control number that appears on the materials sent to you. You may vote during the Annual Meeting by following the instructions available on the meeting website during the meeting. Your attendance alone, without voting, will not be sufficient to revoke a previously authorized proxy.
Thank you in advance for your cooperation and continued support.
By Order of the Board of Directors,
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Natasha Luddington
Senior Vice President, Associate General Counsel
March 26, 2021
Beverly Hills, California
 

Whether or not you plan to attend the Annual Meeting virtually, please vote as soon as possible to make sure that your shares are represented at the Annual Meeting.
STOCKHOLDERS OF RECORD
Your shares cannot be counted unless you vote by any of these methods:
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BY
TELEPHONE
BY
INTERNET
BY
MAIL
BY
MOBILE DEVICE
DURING THE
ONLINE MEETING
Call toll-free
1-800-690-6903
www.proxyvote.com
Complete, sign and date the proxy card and mail it in the enclosed postage-paid envelope
Scan the QR code
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www.virtualshareholdermeeting.com/PACW2021

Stockholders can vote their shares via telephone or the Internet as instructed in the Notice Regarding Availability of Proxy Materials for the Annual Meeting (“Notice”)

The telephone and internet voting facilities will close at 11:59 p.m., Eastern Time, on May 10, 2021 for shares held directly and at 11:59 p.m., Eastern Time, on May 6, 2021 for shares held in the Company’s 401(k) Plan

Proxy cards submitted by mail must be received by Broadridge Financial Solutions, at Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, New York 11717, prior to the Annual Meeting

Each stockholder who attends the Annual Meeting virtually will need the control number that appears on the materials sent to you
BENEFICIAL OWNERS

If your shares are held in “street name”, you should check with your bank, broker or other agent and follow the voting procedures required by your bank, broker or other agent to vote your shares

Each stockholder who attends the Annual Meeting virtually will need the control number that appears on the materials sent to you
   
Important Notice Regarding the Availability of Proxy Materials for
the Annual Meeting of Stockholders to Be Held on May 11, 2021
This Proxy Statement and our 2020 Annual Report are available at
www.pacwestbancorp.com/docs
 

 
TABLE OF CONTENTS
1 Proxy Summary
7
7 Proposal 1―Election of Directors
8 Director Nominees
19
20 Board Committees and Meetings
20
21
22
23
24
25 Corporate Governance
25
25
26
26
27
27
28
28
29
30
32
32
33
34
34 Director Compensation
35 2020 Non-Employee Director Compensation Table
36 Executive Compensation
36 Proposal 2―Advisory Vote on Executive Compensation
37 Executive Officers
42 Compensation Discussion and Analysis
43
43
44
44
45
45
45
46
46
47
47
47
47
48
48
48
49
49
49
50
52
53
54
55
55
57
57
58 Compensation Committee Report
59 Executive Compensation Tables
59
61
62
63
64
65
67 CEO Pay Ratio
68 Amended and Restated PacWest Bancorp 2017 Stock Incentive Plan
68
77 Audit Matters
78 Independent Auditor
78 Independent Auditor Fees
78 Pre-Approval Policies and Procedures
79 Audit Committee Report
80 Owners of More Than Five Percent
81 Ownership of Directors and Executive Officers
83 Section 16(a) Beneficial Ownership Reporting Compliance
84
89 Other Business
89
Stockholder Proposals
90
Director Nominations
91 Incorporation by Reference
A-1 Appendix A
 

 
PROXY SUMMARY
This summary highlights information contained elsewhere in this Proxy Statement. This summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement before voting.
For more complete information regarding the Company’s 2020 performance, please review the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.
2021 Annual Meeting of Stockholders
Voting and Meeting Information
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See page 84 for more information.
[MISSING IMAGE: tm211559d2-icon_cal.gif]   WHEN
[MISSING IMAGE: tm211559d2-icon_mic.gif]   LIVE WEBCAST
[MISSING IMAGE: tm211559d2-icon_record.gif]   RECORD DATE
Tuesday, May 11, 2021
1:00 p.m. Pacific time
www.virtualshareholdermeeting.com/PACW2021
Close of business on
March 15, 2021
[MISSING IMAGE: tm211559d2-icon_voting.gif]    VOTING
[MISSING IMAGE: tm211559d2-icon_attendvote.gif]    ATTENDING AND VOTING AT THE ANNUAL MEETING

You are entitled to vote at the Annual Meeting if you were a stockholder of record at the close of business on the Record Date

On the Record Date, there were 116,916,461 shares of common stock outstanding and entitled to vote at the Annual Meeting

Each share is entitled to one vote on each matter to be voted upon at the Annual Meeting

All stockholders of record as of the Record Date may vote virtually at the Annual Meeting

In order to authorize your proxy via the Internet or by telephone, and to be admitted to the Annual Meeting at
www.virtualshareholdermeeting.com/PACW2021, you must have the control number that appears on the materials sent to you. You may vote during the Annual Meeting by following the instructions available on the meeting website. Your attendance alone, without voting, will not be sufficient to revoke a previously authorized proxy
Please see the Information about the Annual Meeting and Voting section beginning on page 84.
The deadlines to submit stockholder proposals for the 2022 Annual Meeting of Stockholders (“2022 Annual Meeting”) can be found in the Other Business section on page 89.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  1

 
Advance Voting Methods
Advance voting methods can be found on page 85.
Notice Regarding the Availability of Proxy Materials for the
Annual Meeting
Unless you previously elected to receive paper copies of our proxy materials, we are sending our stockholders a Notice that will instruct you on how to access the proxy materials and proxy card to vote your shares by telephone or over the internet. If you would like to receive a paper copy of our proxy materials free of charge, please follow the instructions included in the Notice.
It is anticipated that the Notice will be mailed to stockholders on or before April 1, 2021.
Ballot Items
Stockholders are being asked to vote on the following proposals at the Annual Meeting.
Proposals
Board Recommendation
See
Page
1
Election of 11 directors
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FOR each director
nominee
7
2
Approval, on an advisory basis (non-binding), of the compensation of the Company’s named executive officers
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FOR
36
3
Approval of the Amended and Restated PacWest Bancorp 2017 Stock Incentive Plan
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FOR
68
4
Ratification of the appointment of KPMG LLP as the Company’s independent auditors for the fiscal year ending December 31, 2021
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FOR
77
 
2  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
Director Nominees
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See page 8 for more information.
Snapshot of the Board and Director Nominees
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PACWEST BANCORP  2021 PROXY STATEMENT  |  3

 
The following table provides summary information about each director nominee:
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4  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
Corporate Governance Highlights
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See page 25 for more information.
PacWest is committed to maintaining strong governance practices, and the Board regularly reviews its governance procedures to ensure compliance with laws, rules and regulations.
Our website at www.pacwestbancorp.com includes important information about our policies and Board committee charters, including the Company’s Corporate
Governance Guidelines (the “Guidelines”), our Code of Business Conduct and Ethics and certain Company U.S. Securities and Exchange Commission (“SEC”) filings and press releases. Examples of our corporate governance practices are set forth in the Corporate Governance section of this Proxy Statement, and certain of our governance practices are highlighted below.
Stockholder Engagement
We solicited stockholder input on a number of Company matters, including corporate strategy, social responsibility, corporate governance and executive compensation matters to ensure that our actions are informed by the viewpoints of our stockholders.
As a result of these conversations, we made certain governance enhancements over the years to address feedback we received, including the following:

Annual review of director skill sets and experience

Focus on Board composition, recruitment, refreshment, succession planning and enhanced diversity Proxy Statement disclosures

Enhanced Cybersecurity, Social Responsibility and Human Capital Management Proxy Statement disclosures

Added Proxy Statement disclosures with respect to the COVID-19 pandemic impact and our response

Continued stockholder outreach

Enhanced Proxy Statement disclosures to more clearly articulate compensation and corporate governance practices
At our 2020 Annual Meeting, the majority of our investors―approximately 81.49% of the total votes cast on the advisory vote on executive compensation, say
on pay―continued to support the design of our executive compensation program. Subsequent to the meeting, we reached out to stockholders to discuss matters specific to our executive compensation program, including how pay aligns with the Company’s performance. We were able to engage in substantive discussions with stockholders on these topics. These discussions were in addition to our regular stockholder engagement activities that occur throughout the year.
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Stockholders are urged to read the Compensation Discussion and Analysis (“CD&A”) section and other information in this Proxy Statement to better understand how the Company’s executive compensation program engages and aligns with the Company’s short- and long-term performance and creates long-term stockholder value.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  5

 
Compensation Matters―Executive Summary
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See page 43 for more information.
The CD&A provides information about our executive compensation philosophy and objectives and the process governing our named executive officers’ (“NEOs”) 2020 total compensation. The Company’s compensation disclosures in this Proxy Statement include the following NEOs: the Chief Executive Officer (“CEO”), Chief Financial Officer (“CFO”), and the three highest paid other executive officers. We assess executive officer performance by analyzing specific, achieved Company financial goals. The Company’s executive compensation program balances short- and long-term Company performance with stockholder value creation. In addition, the compensation program provides incentives needed to attract, reward, motivate and retain key executives who are critical to executing the Company’s strategy for long-term success.
We align executive compensation to the success of the Company and the interests of our stockholders by making annual cash incentive payments to executive officers based on Company achievement of pre-established measures that are directly tied to Company performance as detailed in our CD&A.
Executive officers are only entitled to annual cash incentive payments if Company financial performance is achieved with respect to specified performance requirements.
In addition, the Company’s long-term incentive compensation plan ties a meaningful portion of executive officer compensation to Company performance. Specifically, 50% of an executive officer’s long-term incentive compensation is granted in the form of performance-based restricted stock units (“PRSUs”) that vest only upon the attainment of key Company financial performance metrics measured over a three-year period. The other 50% of an executive officer’s long-term incentive compensation is time-based restricted stock awards (“TRSAs”) that vest ratably over four years. The Company believes this long-term incentive compensation grant structure appropriately aligns Company performance with stockholder interests.
Details of our executive compensation philosophy, objectives, process and decisions can be found under the CD&A section of this Proxy Statement.
 
6  |  PACWEST BANCORP  2021 PROXY STATEMENT

CORPORATE GOVERNANCE AND BOARD MATTERS
Proposal 1 — Election of Directors
The Board is currently composed of 14 directors, of which 13 directors were elected at the 2020 Annual Meeting. The Compensation, Nominating and Governance Committee (the “CNG Committee”) recommended, and the Board approved, 11 director nominees for election to serve as directors of the Company until the 2022 Annual Meeting or until their successors are duly elected and qualified. All director nominees are current directors. The Board may fill one or more of the vacancies following the 2021 Annual Meeting and may determine to reduce the size of the Board to eliminate all or a portion of such vacancies.
In an uncontested election, a director must be elected by a majority of the votes cast with respect to him or her (meaning the number of shares voted “for” a nominee must exceed the number of shares voted “against” such nominee). In a contested election (a situation in which the number of nominees exceeds the number of directors to be elected), the standard for election of directors will be a plurality of the votes cast such that the nominees receiving the greatest number of votes “for” will be elected as directors without regard to the number of shares voted “against” such nominee.
A director who does not receive a majority of the votes cast in an uncontested election must tender his or her resignation to the Board. The CNG Committee will consider the resignation and make a recommendation to the Board whether to accept or reject the resignation or whether other action should be taken. The Board will act on the CNG Committee’s recommendation and publicly disclose its decision and the rationale within 90 days from the date the election results are certified. A director who failed to receive a majority of the votes cast will not participate in the Board’s decision.
With respect to the election of directors, absent any specific instruction in the proxies solicited by the Board, the proxies will be voted in the sole discretion of the proxy holders to effect the election of all 11 of the Board’s nominees. In the event that any of the Board’s nominees are unable to serve as directors, it is intended that each proxy will be voted for the election of such substitute nominees, if any, as shall be designated by the Board. The Company has no reason to believe that any of the nominees will be unable to serve as directors.
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The PacWest Board of Directors recommends a vote FOR all of the nominees listed below.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  7

Director Nominees
The skills, qualities, attributes and experience of the members of the Board provide the Company with a diverse range of perspectives to effectively address the Company’s strategic objectives and represent our stockholders’ best interests.
The biographies below describe the skills, qualities, attributes and experience of the Board nominees.
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COMMITTEES

Risk
Tanya M. Acker
Age 50
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Ms. Acker is a Director of PacWest Bancorp and Pacific Western Bank and is a member of their respective Risk Committees. Ms. Acker is an attorney and arbitrator who has served as one of three judges on a syndicated television court program since 2014. Ms. Acker has served on the Board of Trustees of the Pacific Battleship Center, a nonprofit organization that operates the Battleship IOWA museum (and now the National Museum of the Surface Navy) since 2015 and also serves on the Board of Directors and as Chair of the Awards Committee. Ms. Acker has served on the board of Public Counsel, an organization that provides free legal services since 2008 and she is currently Board Secretary as well as a member of the Douglas Dinner, Executive, Board Development and Compensation Committees. Ms. Acker has served as a director and member of the Executive Committee and previously served as legal counsel for the Western Los Angeles County Council of the Boy Scouts of America since 2013. Ms. Acker serves on the National Executive Board of the Boy Scouts of America where she sits on the Diversity and Inclusion Committee. Ms. Acker has served as a trustee of the Boy Scouts of America Foundation since 2018. Ms. Acker has served as a director of the Western Justice Center, a nonprofit organization that promotes alternative dispute resolution since 2011 and she is a member of the Executive Committee. Ms. Acker is also the owner, president and chief executive officer of Free Eagle Ventures, Inc., a California loan out company. Ms. Acker operated her own private law practice from 2005 until 2013, after which she joined the firm Goldberg, Lowenstein and Weatherwax. From March 2017 to November 2019, Ms. Acker served as a director of Rainbow Services, a nonprofit organization that provides assistance to victims of domestic violence.
MS. ACKER’S BOARD QUALIFICATIONS
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Business operations
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Risk management
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Legal and regulatory
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Strategic planning
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Public company board service
 
8  |  PACWEST BANCORP  2021 PROXY STATEMENT

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COMMITTEES

ALM
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Audit

CNG

Executive
Paul R. Burke
Age 58
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Mr. Burke is a Director of PacWest Bancorp and Pacific Western Bank and is the Chairperson of their respective ALM Committees and a member of each of their respective Audit, CNG and Executive Committees. Mr. Burke is an officer and director of Northaven Management, Inc., a privately owned investment management firm that he co-founded in 1995 that focuses exclusively on equity investments in the financial services industry. Mr. Burke is also managing director and serves on the board of directors for Kilowatt Labs, Inc., a company that designs, manufactures and sells energy storage and power management solutions. From 2009 to January 2021, Mr. Burke served as a director of Optisure Risk Holdings, Inc., a private insurance brokerage firm where he previously served as its chairman, president, and acting chief executive officer. Mr. Burke served as director of Square 1 Financial, Inc., a publicly traded financial services company that the Company acquired on October 6, 2015, where he served as chairman of the Compensation Committee and as a member of the Audit, Asset Liability and various other Committees from 2010 to 2015. He also served as a director of Square 1 Bank from 2012 until 2015. Mr. Burke served as a director of Eastern Insurance Holdings, Inc., a publicly traded property and casualty insurer, from 2001 to 2014, where he chaired the Audit Committee and served as a member of various other committees.
MR. BURKE’S BOARD QUALIFICATIONS
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Audit and financial reporting
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Legal and regulatory
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Business operations
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Mergers and acquisitions
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Corporate and investment banking
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Public company board service
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Financial services industry
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Risk management
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Leadership of highly regulated business
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Strategic planning
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  9

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COMMITTEES

Audit

Executive

Risk
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Craig A. Carlson
Age 70
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Mr. Carlson is a Director of PacWest Bancorp and Pacific Western Bank and is the Chairperson of their respective Risk Committees and a member of each of their respective Audit and Executive Committees. Mr. Carlson is currently a self-employed, financial institution and regulatory consultant and California real estate broker. He was formerly a bank regulator for 36 years and has over 26 years of experience supervising a bank examination staff of over 125 individuals. Mr. Carlson was senior deputy commissioner and chief examiner of the Banking Program for the California Department of Financial Institutions (“DFI”), currently known as the California Department of Financial Protection and Innovation from March 2007 until his retirement in June 2010. In this position, he was responsible for the supervision and regulation of all state chartered commercial and industrial banks as well as other institutions and he served as a key advisor to the Commissioner of the DFI. Previously, he held positions for the DFI as senior deputy commissioner and deputy commissioner for the San Diego/Orange County Region for the DFI. Mr. Carlson was a faculty member of the California Banking School and was a member of the Conference of State Bank Supervisors where he had served as a member of its accreditation review team.
MR. CARLSON’S BOARD QUALIFICATIONS
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Audit and financial reporting
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Financial services industry
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Business operations
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Legal and regulatory
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Corporate and investment banking
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Risk management
 
10  |  PACWEST BANCORP  2021 PROXY STATEMENT

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COMMITTEES

Executive
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John M. Eggemeyer, III
Age 75
Chairman of the Board
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Mr. Eggemeyer is Chairman of the Board of PacWest Bancorp, a position he has held since 2000 when the Company was founded. Mr. Eggemeyer is also a Director of Pacific Western Bank and is the Chairperson of their respective Executive Committees. Mr. Eggemeyer has been an investor, executive and financial advisor in the field of commercial banking for over 40 years. Mr. Eggemeyer is founder and managing principal of Castle Creek Capital LLC, a private equity firm founded in 1990 that specializes in the financial services industry. Mr. Eggemeyer is a Board member of The Bancorp, Inc. and currently serves on its Risk Committee. Since August 2019, Mr. Eggemeyer has served as a Director of Northpointe Bancshares, Inc. and Northpointe Bank. Mr. Eggemeyer currently serves as a trustee of Northwestern University where he serves on the Finance Committee and Investment Committee. Mr. Eggemeyer served as a director of Guaranty Bancorp from 2004 until 2018 and Heritage Commerce Corp. from August 2010 to December 2016.
MR. EGGEMEYER’S BOARD QUALIFICATIONS
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Audit and financial reporting
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Legal and regulatory
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Business operations
[MISSING IMAGE: tm211559d1_icon-mergerpn.jpg]
Mergers and acquisitions
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Corporate and investment banking
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Public company board service
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Financial services industry
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Risk management
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Leadership of highly regulated business
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Strategic planning
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  11

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COMMITTEES

Audit

CNG

Executive
C. William Hosler
Age 57
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Lead Independent Director
BACKGROUND
Mr. Hosler is the Lead Independent Director of the Board of PacWest Bancorp, a Director of Pacific Western Bank and is a member of each of their respective Audit, CNG and Executive Committees. Mr. Hosler is the chief financial officer and member of the board of directors of Catellus Acquisition Company, LLC, a commercial real estate property ownership, management and development company. Mr. Hosler also serves as a director of Fantex, Inc., a Delaware brand building company, where he chairs the Audit Committee. Mr. Hosler also serves as a director and president of the Claremont Country Club. Mr. Hosler also serves as chair of the City of Piedmont Budget Advisory and Financial Planning Committee. Mr. Hosler served as a director of CapitalSource Inc. from 2007 until 2014. Mr. Hosler previously served on the board of directors, Audit Committee and Corporate Governance and Nominating Committee of Parkway Properties, Inc., a self-administered, real estate investment trust.
MR. HOSLER’S BOARD QUALIFICATIONS
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
[MISSING IMAGE: tm211559d1_icon-mergerpn.jpg]
Mergers and acquisitions
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
 
12  |  PACWEST BANCORP  2021 PROXY STATEMENT

[MISSING IMAGE: ph_susan-4clr.jpg]
COMMITTEES

ALM

Audit
[MISSING IMAGE: tm211559d2-icon_corporpn.jpg]

Executive

Risk
Susan E. Lester
Age: 64
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Ms. Lester is a Director of PacWest Bancorp and Pacific Western Bank and is the Chairperson of their respective Audit Committees and member of each of their respective Audit, Risk and Executive Committees.Since 2016, Ms. Lester has served as a public director for The Options Clearing Corporation, an equity derivatives clearing organization, where she chairs the Audit Committee and is a member of the Governance and Nominating Committee and Regulatory Committee. Ms. Lester is also the Francis Parker School Board of Trustees Chair and is a member of the Compensation Committee. Previously, Ms. Lester served as the Francis Parker School’s chair of the Finance Committee. Ms. Lester served as a director of Arctic Cat, Inc., a publicly traded company, from 2004 to March 2017 where she chaired the Audit Committee and was a member of the Governance Committee. Ms. Lester served as a director of Lender Processing Services, Inc. from December 2010 until January 2014, where she was a member of the Audit, Governance and Risk and Compliance Committees. Ms. Lester is a former trustee and treasurer of Hazeltine National Golf Club and a former chair of the Board of Trustees of the College of St. Benedict.
MS. LESTER’S BOARD QUALIFICATIONS
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
[MISSING IMAGE: tm211559d1_icon-mergerpn.jpg]
Mergers and acquisitions
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  13

[MISSING IMAGE: ph_rogermolvar-4clr.jpg]
COMMITTEES

Audit

CNG

Risk
Roger H. Molvar
Age 65
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Mr. Molvar is a Director of PacWest Bancorp and Pacific Western Bank and is a member of each of their respective Audit, CNG and Risk Committees. Mr. Molvar is currently a private investor. Mr. Molvar has served on the board of directors of First Financial Northwest, Inc., First Financial Northwest Bank and First Financial Diversified Corporation (collectively, “First Financial”) since 2015 and he served as the chairman of the board of all three First Financial entities from 2017 until 2019. As a board member of First Financial, Mr. Molvar is a member of the Compensation and Awards Committee, chairs the ALCO Committee and is a member of the Director Loan Committee. Mr. Molvar served as a director of CapitalSource Bank from its formation in 2008 until its merger with Pacific Western Bank in 2014 and he previously served as a director and a member of the Audit Committee of Farmers and Merchants Bank of Long Beach, California.
MR. MOLVAR’S BOARD QUALIFICATIONS
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
[MISSING IMAGE: tm211559d1_icon-mergerpn.jpg]
Mergers and acquisitions
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
 
14  |  PACWEST BANCORP  2021 PROXY STATEMENT

[MISSING IMAGE: ph_danielplatt-4clr.jpg]
COMMITTEES

ALM

Risk
Daniel B. Platt
Age 74
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Mr. Platt is a Director of PacWest Bancorp and Pacific Western Bank and is a member of each of their respective ALM and Risk Committees. Mr. Platt is a former executive vice president of the Company and he oversaw the Special Assets Group of Pacific Western Bank from November 2009 until his retirement in April 2014. Mr. Platt served as a director of Pacific Western Bank from November 2009 until April 2014. Mr. Platt serves as a director for a number of charitable organizations including: (i) A Step Beyond where he previously served as chairman and treasurer, (ii) The Barnabus Group where he also serves as treasurer and (iii) the Rancho Santa Fe Foundation where he serves as treasurer and chairman of the Finance Committee and is a member of the Executive Committee.
MR. PLATT’S BOARD QUALIFICATIONS
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
[MISSING IMAGE: tm211559d2-icon_mergers4clr.jpg]
Mergers and acquisitions
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  15

[MISSING IMAGE: ph_robert-4clr.jpg]
COMMITTEES

CNG
[MISSING IMAGE: tm211559d2-icon_corporpn.jpg]

Executive
Robert A. Stine
Age 74
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Mr. Stine is a Director of PacWest Bancorp and Pacific Western Bank and is the Chairperson of their respective CNG Committees and a member of their respective Executive Committees. Mr. Stine has served as a director of Bolthouse Properties, LLC, a privately held real estate development and land management company based in Kern County, California since 2015. Mr. Stine is also a director of Rancho Santa Fe Foundation where he chairs the Compensation Committee and is a member of the Executive Committee. Mr. Stine is the former president and chief executive officer of Tejon Ranch Co., a publicly traded real estate development and agri-business company, which positions he held from May 1996 until his retirement in December 2013. Mr. Stine also served as a director of Tejon Ranch Co. from 1996 until May 2015. He was also a founding director of Valley Republic Bank, a community bank located in Kern County, California, a position he held from 2008 until May 2015.
MR. STINE’S BOARD QUALIFICATIONS
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
[MISSING IMAGE: tm211559d2-icon_mergers4clr.jpg]
Mergers and acquisitions
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
 
16  |  PACWEST BANCORP  2021 PROXY STATEMENT

[MISSING IMAGE: ph_paulwtaylornew-4c.jpg]
COMMITTEES

None
Paul W. Taylor
Age 60
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Independent Director
BACKGROUND
Mr. Taylor is a Director of PacWest Bancorp and Pacific Western Bank. From May 2019 until June 2020, Mr. Taylor was CEO, President and Director of Opus Bank, a California-chartered bank, which subsequently merged into Pacific Premier Bank, a California-chartered bank. From February 2011 until December 2018, Mr. Taylor was the CEO, President and Director of Guaranty Bancorp, where he served on the Corporate Risk Committee. Mr. Taylor also was the Chief Executive Officer and Chairman of the Board of Guaranty Bank and Trust Company, a banking subsidiary of Guaranty Bancorp. Prior to becoming CEO and President of Guaranty Bancorp, Mr. Taylor held various positions including Executive Vice President, Chief Financial and Operating Officer and Secretary of Guaranty Bancorp.
MR. TAYLOR’S BOARD QUALIFICATIONS
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
[MISSING IMAGE: tm211559d2-icon_mergers4clr.jpg]
Mergers and acquisitions
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  17

[MISSING IMAGE: ph_matthewwagner-4clr.jpg]
COMMITTEES

ALM

Executive

Risk
Matthew P. Wagner
Age 64
[MISSING IMAGE: tm211559d2-icon_tickwhitpn.gif]Director
BACKGROUND
Mr. Wagner is a Director of PacWest Bancorp and Chairman of the Board of Pacific Western Bank and is a member of each of their respective ALM, Risk and Executive Committees. Mr. Wagner has been the President and CEO of PacWest Bancorp and Pacific Western Bank since 2000.
MR. WAGNER’S BOARD QUALIFICATIONS
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
[MISSING IMAGE: tm211559d1_icon-mergerpn.jpg]
Mergers and acquisitions
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
 
18  |  PACWEST BANCORP  2021 PROXY STATEMENT

Director Skill Competencies
Our Board members represent a mix of experience, tenure, diversity, leadership, skills and qualifications in areas of importance to our Company. The CNG Committee believes the following director qualifications are the most important to oversee the interests of our Company.
Background or Proficiency
Importance
[MISSING IMAGE: tm211559d1_icon-auditpn.jpg]
Audit and financial reporting
A background or proficiency in audit matters and financial reporting with respect to a publicly-traded financial institution is important to the operations of our business.
[MISSING IMAGE: tm211559d1_icon-operapn.jpg]
Business operations
A background or proficiency in the management of a business, including its operations and strategic pursuits.
[MISSING IMAGE: tm211559d1_icon-corporpn.jpg]
Corporate and investment banking
A background or proficiency in connection with banking, borrowing and lending as well as investment banking activities is important to our continued success.
[MISSING IMAGE: tm211559d1_icon-financpn.jpg]
Financial services industry
A background or proficiency in the financial services industries, notably public company commercial banking is critical in our economic environment.
[MISSING IMAGE: tm211559d1_icon-leaderspn.jpg]
Leadership of highly regulated business
A background or proficiency with respect to our highly regulated industry, including commercial banking is important to successfully operate our organization.
[MISSING IMAGE: tm211559d1_icon-legalpn.jpg]
Legal and regulatory
A background or proficiency in legal and regulatory matters associated with a financial institution is necessary.
[MISSING IMAGE: tm211559d1_icon-mergerpn.jpg]
Mergers and acquisitions
A background or proficiency with respect to banking, mergers and acquisitions, capital market transactions and long-term strategic planning is of utmost importance.
[MISSING IMAGE: tm211559d1_icon-publicopn.jpg]
Public company board service
A background or proficiency as a board member of a public company board, notably of a highly regulated financial institution, brings a viewpoint that is indispensable.
[MISSING IMAGE: tm211559d1_icon-riskmanpn.jpg]
Risk management
A background or proficiency in risk management of a public company, including acting in response to organization risks is vital.
[MISSING IMAGE: tm211559d1_icon-strategicpn.jpg]
Strategic planning
A background or proficiency with respect to the strategic direction of a public company, including future growth opportunities is essential.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  19

Board Committees and Meetings
The CNG Committee regularly considers the composition of our Board to ensure there is a proper combination of skills and viewpoints.
During 2020, the Board met seventeen times. The independent directors met five times in executive session during 2020, and Mr. Hosler, the Lead Independent Director, presided over these sessions. In 2020, each director attended at least 75% of the meetings of the Board and the committees on which he or she served.
Directors are encouraged, but not required, to attend the Annual Meeting. 12 directors attended the virtual 2020 Annual Meeting. The Company assists in making arrangements for directors that attend the Annual Meeting and reimburses directors for reasonable expenses in connection with attendance.
[MISSING IMAGE: ph_paulrburke-4clr.jpg]
MEMBERS

Paul R. Burke
[MISSING IMAGE: tm211559d2-icon_corporpn.jpg]

Susan E. Lester

Daniel B. Platt

Matthew P. Wagner
[MISSING IMAGE: tm211559d2-icon_arrow1pn.jpg]
A copy of our ALM Committee charter, last approved by the Board in February 2021, may be obtained on the Company’s website at www.pacwestbancorp. com under the section titled Corporate Governance.
Asset/Liability Management Committee
Meetings in 2020: 4
OVERVIEW
The Asset/Liability Management (“ALM”) Committee (the “ALM Committee”) monitors the asset and liability strategies of the Company to ensure compliance with all applicable regulatory and reporting requirements and Company policies. The ALM Committee’s objectives are:
(i)
to manage balance sheet and off-balance sheet assets and liabilities in an effort to maximize the spread between interest earned on our interest-earning assets and interest paid on our interest-bearing liabilities;
(ii)
to maintain acceptable levels of interest rate risk; and
(iii)
to ensure that the Company has the ability to pay liabilities as they come due and fund continued asset growth.
ALM activities are typically discussed monthly by the executive management members responsible for managing ALM activities.
KEY RESPONSIBILITIES
The responsibilities of the ALM Committee include, among other things:

approving, on an annual basis, any asset liability management policies the ALM Committee deems appropriate or are required to be approved by applicable law or regulation;

reviewing the results of the interest rate risk and liquidity monitoring and reporting system, including performance relative to established policy limits, risk categories and operating targets (as set forth in the Company’s Risk Appetite Statement (“RAS”));

reviewing liquidity stress test results;

monitoring performance of the Company’s investment portfolio and strategies including portfolio activity, unrealized gains and losses, portfolio yield, duration and total return, and credit quality (including Municipal portfolio surveillance); and

reviewing the status of the Company’s derivatives and hedge positions.
 
20  |  PACWEST BANCORP  2021 PROXY STATEMENT

[MISSING IMAGE: ph_susan-4clr.jpg]
MEMBERS

Susan E. Lester
[MISSING IMAGE: tm211559d2-icon_corporpn.jpg]

Paul R. Burke

Craig A. Carlson

C. William Hosler

Roger H. Molvar
[MISSING IMAGE: tm211559d2-icon_rightpn.jpg]
All members of the Audit Committee are independent.
The Board determined that all of the nominees to the Audit Committee are financially literate. In addition, each member is qualified as an audit committee financial expert with accounting or related financial management expertise, in each case in accordance with the SEC rules and the Nasdaq listing standards.
[MISSING IMAGE: tm211559d2-icon_arrow1pn.jpg]
A copy of our Audit Committee charter, last approved by the Board in February 2021, is available on our website at
www.pacwestbancorp.
com under the section titled Corporate Governance.
Audit Committee
Meetings in 2020: 14
OVERVIEW
The Audit Committee assists the Board in its oversight responsibilities for:
(i)
the quality and integrity of the Company’s financial statements;
(ii)
the Company’s compliance with legal and regulatory requirements;
(iii)
the independent auditors’ qualifications and independence;
(iv)
the performance of the independent auditors and the Company’s internal audit function; and
(v)
in conjunction with the Company’s Risk Committee, the Company’s risk management functions.
KEY RESPONSIBILITIES
The responsibilities of the Audit Committee include, among other things:

With respect to the independent auditors:
(i)
to be directly responsible for the appointment, compensation, retention and oversight of the work of the independent auditors (including the resolution of disagreements between management and the independent auditors regarding accounting and financial reporting matters);
(ii)
to be directly responsible for the appointment, compensation, retention and oversight of the work of any other registered public accounting firm engaged for the purpose of preparing or issuing an audit report or to perform audit, review, or attestation services; and
(iii)
to pre-approve, or to adopt appropriate procedures to pre-approve, all audit and non-audit services to be provided by the independent auditors.

With respect to the internal audit function:
(i)
in conjunction with the Company’s Chief Audit Executive (“CAE”) to select, engage, oversee and retain any firms used in a co-sourcing capacity as part of the Company’s internal audit function, and to review and evaluate qualifications, performance and independence of the members of the internal audit function (whether out-sourced or performed in-house); and
(ii)
to review reports from the internal audit department regarding internal controls and procedures, the Company’s financial controls, accounting system, operational controls and procedures, regulatory and legal compliance and changes to the Company’s policy and procedures manuals.

With respect to accounting principles and policies, financial reporting and internal control over financial reporting:
(i)
to review from management, the internal audit department and the independent auditors a timely analysis of significant issues and practices relating to accounting principles and policies, financial reporting and internal control over financial reporting; and
(ii)
to consider any reports or communications (and management’s and/or the internal audit departments responses thereto) submitted to the Audit Committee by the independent auditors required or referred to in applicable standards, including reports and communications related to the overall audit strategy, including the timing of the audit, significant risks the independent auditors identified, and significant changes to the planned audit strategy or identified risks.

With respect to meeting with management;
(i)
to discuss the scope of the annual audit; and
(ii)
to discuss any significant matters arising from any audit, including any audit problems or difficulties, whether raised by management, the CAE or the independent auditors relating to the Company’s financial statements.

With respect to Environmental, Social and Governance (“ESG”) matters and/or any reporting, to oversee and receive a report from management’s ESG Committee on a periodic basis outlining the activities of the ESG Committee, any information being reported externally (i.e. website, proxy statement or corporate social responsibility report) and/or any initiatives for which the Board should be aware.

With respect to reporting and recommendations:
(i)
to review, approve and oversee any transaction between the Company and any related person (as defined in Item 404 of Regulation S-K) on an ongoing basis, in accordance with the Company’s Related-Party Transactions Policy;
(ii)
to review with management disclosures contained in press releases and financial statement filings with the SEC; and
(iii)
to prepare any report or other disclosures, including any recommendation of the Audit Committee, required by the rules of the SEC to be included in the Company’s annual proxy statement.
Our independent auditors, KPMG LLP,have extensive, long-term knowledge of the Company and the banking industry.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  21

[MISSING IMAGE: ph_robert-4clr.jpg]
MEMBERS

Robert A. Stine
[MISSING IMAGE: tm211559d2-icon_corporpn.jpg]

Paul R. Burke

C. William Hosler

Roger H. Molvar
[MISSING IMAGE: tm211559d2-icon_rightpn.jpg]
All members of the CNG Committee are independent.
[MISSING IMAGE: tm211559d2-icon_arrow1pn.jpg]
A copy of our CNG Committee charter, last approved by the Board in February 2021, may be obtained on the Company’s website at
www.pacwestbancorp.
com under the section titled Corporate Governance.
Compensation, Nominating
and Governance Committee
Meetings in 2020: 15
OVERVIEW
The CNG Committee’s objectives are:
(i)
to review, approve and make recommendations to the Board on matters concerning the compensation and benefits, including equity compensation, of the Company’s executive officers, directors and employees; and
(ii)
to ensure that the Company’s compensation programs are competitive and aligned with our stockholders’ long-term interests.
KEY RESPONSIBILITIES
The responsibilities of the CNG Committee include, among other things:

reviewing and approving corporate goals and objectives relevant to the compensation of the CEO, evaluating the performance of the CEO in light of those goals and objectives and recommending to the Board for determination, the CEO’s compensation level;

determining the compensation of all other executive officers of the Company;

approving any new equity compensation plan or any material change to an existing plan where stockholder approval has not been obtained;

making recommendations to the Board with respect to the Company’s incentive compensation plans and equity-based plans and the Company’s 401(k) plan(s) or other employee benefit plans, including overseeing the activities of the individuals and committees responsible for administering these plans and discharging any responsibilities imposed on the Committee by any of these plans;

approving the annual performance measures, performance targets, performance weights, achievement levels and award opportunities under the Company’s Executive Incentive Plan;

reviewing, at least annually, all components of CEO and executive officer compensation, including perquisites; and

with respect to equity based compensation, approving grants of equity based awards to eligible employees.
The CNG Committee assists the Board in promoting the best interests of the Company and its stockholders through the implementation of sound corporate governance principles and practices, which helps to frame our organization-wide risk management policies, including oversight of the Company’s Stock Ownership and Clawback Policy.
 
22  |  PACWEST BANCORP  2021 PROXY STATEMENT

[MISSING IMAGE: ph_eggemeyer-4clr.jpg]
MEMBERS

John M. Eggemeyer, III
[MISSING IMAGE: tm211559d2-icon_corporpn.jpg]

Paul R. Burke

Craig A. Carlson

C. William Hosler

Susan E. Lester

Robert A. Stine

Matthew P. Wagner
[MISSING IMAGE: tm211559d2-icon_arrow1pn.jpg]
A copy of our Executive Committee charter, last approved by the Board in February 2021, may be obtained on the Company’s website at www.pacwestbancorp.com under the section titled Corporate Governance.
Executive Committee
Meetings in 2020: 0
OVERVIEW
The primary purpose of the Executive Committee is to meet when it is impractical for the full Board to meet and act on behalf of the Board, subject to such limitations as the Board, the Executive Committee charter and applicable law may impose.
In addition, the Executive Committee is a forum to review other significant matters, including strategic opportunities, not addressed by the other Board committees and to make appropriate recommendations to the Board.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  23

[MISSING IMAGE: ph_carlson-4clr.jpg]
MEMBERS

Craig A. Carlson
[MISSING IMAGE: tm211559d2-icon_corporpn.jpg]

Tanya M. Acker

Susan E. Lester

Roger H. Molvar

Daniel B. Platt

Matthew P. Wagner
[MISSING IMAGE: tm211559d2-icon_arrow1pn.jpg]
A copy of our Risk Committee charter, last approved by the Board in February 2021, may be obtained on the Company’s website at
www.pacwestbancorp.
com under the section titled Corporate Governance.
Risk Committee
Meetings in 2020: 6
OVERVIEW
The Risk Committee approves and periodically reviews the Company’s risk management policies and oversees the implementation of the Company’s enterprise-wide risk management framework, including the strategies, policies, procedures, assessments and systems established and maintained by management to identify, assess, measure and manage the Company’s material risks.
The Risk Committee assists the Board and its other committees that oversee specific risk-related issues and serves as a resource to management, including:

management’s Enterprise Risk Management Steering Committee by overseeing risk across the entire Company and by enhancing the Board’s understanding of the Company’s overall risk tolerance and enterprise-wide risk management activities and their effectiveness;

coordinating with the Audit Committee for review of the Company’s financial and operational risks, corporate-wide compliance and other areas of Audit Committee responsibility; and

coordinating with the CNG Committee for review of compensation-related risks.
KEY RESPONSIBILITIES
The responsibilities of the Risk Committee include, among other things:

overseeing management’s implementation of a risk management framework that is commensurate with the Company’s structure, risk profile, complexity, activities and size, including the development and implementation of effective policies, processes and procedures designed to ensure that risks are properly controlled, quantified and within the Company’s risk appetite and associated risk tolerances;

at least annually, reviewing and recommending to the Board for approval the Company’s RAS;

on a quarterly basis, reviewing and approving the Company’s Risk Dashboard, including the limits and tolerance ranges within it; and

receiving reports from management, including the Chief Risk Officer (“CRO”) (at least quarterly), the Chief Credit Officer (“CCO”) and the CFO and, if appropriate, other Board committees, regarding matters relating to risk management and/or the Company’s risk and compliance organization, including relevant emerging risks and other selected risk topics and/or risk issues.
The Company’s CRO, CCO and CFO report on a quarterly basis to the Risk Committee, or more frequently as needed, regarding areas within their supervision that pertain to the Company’s risk profile. The Risk Committee also receives reports from the Company’s external credit review consultants.
 
24  |  PACWEST BANCORP  2021 PROXY STATEMENT

Corporate Governance
Governance Framework
The Company has a robust governance framework, and we have adopted the following corporate governance best practices:
Board Practices
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Board recruitment and refreshment, succession planning and diversity and inclusion efforts
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Majority vote standard for the election of directors in uncontested elections
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Independent lead director
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Majority independent directors
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All committees chaired by independent directors
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Separate Chairman and CEO
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Regular executive sessions of independent directors
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Director continuing education program
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Risk oversight by the Board and committees
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Annual Board and committee self-assessments and evaluations
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Annual review of director skills and experience
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Annual Board review of executive and senior management succession plans
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All directors attended at least 75% of 2020 meetings
Stockholder Rights
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Annual “say-on-pay” advisory vote
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Annual election of directors
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No stockholder rights plan (“poison pill”)
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Active stockholder engagement program
Other Governance Best Practices
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Anti-hedging and anti-pledging policy
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Stock ownership guidelines for all directors and executive officers
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Clawback provisions for executive incentive compensation
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No change of control tax gross-up payments
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Related-Party Transactions Policy
Board Leadership Structure
Each year, the Board evaluates the Company’s Board leadership structure to ensure that it remains an appropriate structure for our Company and stockholders. Our current structure provides for separate roles of the Chairman of the Board (“Chairman”) and CEO, a lead independent director (“Lead Independent Director”), and all committees are chaired by independent directors. We believe this structure provides for open communication between the Board and management and provides the oversight and safeguards necessary to operate our business successfully
. Board Leadership Structure

Chairman of the Board: John M. Eggemeyer, III

CEO: Matthew P. Wagner

Lead Independent Director: C. William Hosler

All Committees chaired by independent directors
In Mr. Eggemeyer’s role as Chairman, he has responsibility for, among other things:

Chairing meetings of the Board and the annual meeting of stockholders

Reviewing and approving Board meeting agendas, meeting schedules and information provided to the Board and ensuring such information is appropriately disseminated

Acting as liaison between non-management members of the Board and management

Meeting periodically with the CEO for informal discussion concerning material issues involving the Company

Providing input to the CNG Committee concerning the performance of the CEO
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  25

In Mr. Hosler’s role as Lead Independent Director, he has considerable authority and responsibility, including the following:

Presiding at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent directors

Serving as a liaison between the Chairman and the independent directors

Serving as a member of the Executive Committee

Reviewing and approving Board meeting agendas, meeting schedules and information provided to the Board

Ensuring that matters of concern or of interest to the independent directors are appropriately scheduled for discussion at Board meetings

Calling meetings of the independent directors

Being available for consultation and direct communication with stockholders, as appropriate

Performing such other duties as the Chairman or the Board may from time to time delegate or request
Director Independence
NASDAQ RULE
In 2020, independent directors comprised a majority of the Board in accordance with the Company’s Guidelines. At least annually, the Board, with the assistance of the CNG Committee, evaluates director independence based on the Nasdaq listing standards and applicable SEC rules and regulations. In February 2021, the Board affirmatively determined, upon the recommendation of the CNG Committee, that each director nominee, with the exception of Mr. Wagner, met the independence requirements of the Nasdaq listing standards and applicable SEC rules and regulations, including the independence requirements for committee membership. In making such determinations, the Board evaluated banking, commercial, service, familial or other transactions involving each director or immediate family member and their related interests, on the one hand, and the Company, on the other hand, if any.
In identifying and recommending director nominees, the CNG Committee places emphasis on the Selection of Directors criteria in our Guidelines, namely:

personal qualities and characteristics, accomplishments and reputation in the business community

current knowledge and contacts in the communities where the Company does business and in the Company’s industry or other industries relevant to the Company’s business

ability and willingness to commit adequate time to Board and committee matters

the fit of the skills and personality of director nominees with those of other directors in
creating a Board that is effective, collegial and responsive to the needs of the Company

diversity of viewpoints, background, experience and other demographics

other factors, such as judgment, skill diversity, experience with businesses and other organizations of comparable size, the interplay of the candidate’s experience with the experience of other Board members, and the extent to which the candidate would be a desirable addition to the Board and any committees of the Board
The CNG Committee does not set specific, minimum qualifications that a director nominee must meet in order for the CNG Committee to recommend the director nominee to the Board. The CNG Committee believes that each director nominee should be evaluated based on his or her individual merits taking into account the needs of the Company and the composition of the Board. The CNG Committee evaluates the composition of the Board, including whether the diversity of the Board members is appropriate to advise the Company on its risks and opportunities, through its annual Board self-evaluation process.
The CNG Committee members may seek input from other Board members in identifying possible director nominee candidates and may, at its discretion, engage one or more search firms to assist in the recruitment of director nominee candidates. The CNG Committee will consider candidates recommended by stockholders against the same criteria as director nominees not proposed by stockholders. Stockholders who wish to submit director nominees for consideration by the CNG Committee for election at the 2022 Annual Meeting should follow the process detailed on page 90.
 
26  |  PACWEST BANCORP  2021 PROXY STATEMENT

Director Recruitment and Refreshment and Continued Board Service
On January 29, 2021, Mr. Paul Taylor was added to our Board. Mr. Taylor’s extensive experience in the financial services industry, including his leadership positions at a number of financial institutions, assists in strengthening the competency of the Board and the overall interests of our Company.
To further enhance the independence of the Board, the CNG Committee determined that it would not nominate Messrs. Pieczynski or Yung to the 2021 Board.
Our Company’s Guidelines provide that a director who would be age 75 at the time of election shall not stand for election. Mr. Messer, a member of our Board since 2019, will be 75 as of the date of the
2021 Annual Meeting and will not stand for reelection pursuant to the age guideline set forth in the Guidelines.
Our Chairman of the Board, Mr. Eggemeyer, will be 75 as of the date of the 2021 Annual Meeting. Notwithstanding the age guideline set forth in the Guidelines, the Board, as recommended by the CNG Committee, determined that the continued services of Mr. Eggemeyer on the Board was in the best interest of the Company in light of, among other factors, (i) the continuing effects on the Company and its businesses and results of operations due to the COVID-19 pandemic and the related governmental and other responses to the pandemic, (ii) the Company’s recently announced CEO succession arrangement, and (iii) Mr. Eggemeyer’s extensive knowledge and experience with the Company and its businesses and affairs.
Board’s Role in Risk Oversight
We believe that effective risk management is of primary importance to the success of our Company because our business exposes us to risks related to:

credit

interest rate and price

liquidity

operations

information technology

compliance

strategy

reputation

human resources

capital
As a result, we have a comprehensive enterprise-wide risk management process that monitors, measures, evaluates and manages these core risks.
Under the Company’s governance structure and applicable law, the Board is ultimately responsible for overseeing the Company’s risk management processes and management’s strategic initiatives. The Company has adopted the three lines of defense risk management model, and the Board has delegated certain oversight responsibilities to its committees. The Board’s risk management oversight is managed through the responsibilities of the following Board standing committees:

the Risk Committee

the ALM Committee

the Audit Committee

the CNG Committee
Each of these committees is responsible for monitoring risks within their areas of responsibility as well as Company risks. Each committee reports to the Board and has the responsibility for ensuring that overall risk awareness and risk management is appropriate. Our Risk Appetite Statement establishes the Company’s risk appetite and tolerance for each of our core risk pillars as well as details the policies and procedures for assessing, measuring and controlling these risks. Management has identified several key risk and performance indicators that are tracked quarterly and reported to the Board through a quarterly risk dashboard. Annual risk assessments are performed in all core areas of operations to assess the quantity of inherent risk, the adequacy of controls and resultant residual risk.
The Board engages in regular risk-management discussions with the:

CEO

CFO

Chief Credit Officer

Chief Risk Officer

Chief Audit Executive

Chief Operating Officer (“COO”)
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  27


Executive Vice President, Strategy and Corporate Development

Executive Vice President, Human Resources

other Company officers as the Board may deem appropriate
As a general matter, except for cases where a particular committee may choose to meet in executive session, all Board members are invited (but not required) to attend the regular meetings of all Board committees. We believe that this open and collaborative structure provides for a more informed Board and helps the Board understand and monitor internal and external risks. The CRO meets with the Risk Committee in Executive Session as needed at each quarterly meeting.
Company management is responsible for day-to-day risk management. The CRO provides the Board, directly, or through the Risk Committee, with regular reports on the operation and effectiveness of the enterprise risk management program, the top and emerging risks to our business and the controls and other mitigating factors utilized to manage those risks. Our Internal Audit, Risk Management, Information Technology, Human Resources, Legal, Credit Administration, Accounting, Finance and Treasury departments, among others, monitor compliance with Company-wide policies and procedures and the day-to-day risk management of the Company. We believe that this approach to risk management adequately addresses the Company risks.
COVID-19 Impact and Response
In response to the COVID-19 pandemic, we implemented significant changes that we determined were in the best interest of our employees, as well as the communities where we operate, and which comply with government regulations. This includes having the vast majority of our non-branch employees work from home, while implementing additional safety measures and paying special bonuses for employees continuing critical on-site work. In addition, we regularly provide to the Board COVID-19 pandemic impact
updates and our response to COVID-19 related matters affecting our business and employees. As a result of the COVID-19 pandemic, we routinely review our loan portfolios to assess whether there are any signs of credit deterioration.
For more comprehensive information on the COVID-19 impact and our response to the COVID-19 pandemic see the Recent Events section of our Annual Report on Form 10-K for the year ended December 31, 2020.
Cybersecurity Matters
Protecting the Company’s systems to ensure the safety of our customers’ information is critical to our business. We use multiple layers of protection to control access, detect unusual activity and reduce risk, including conducting a variety of audits and vulnerability and penetration tests on our platforms, systems and applications, and maintain comprehensive incident response plans to minimize potential risk to operations, and reduce the risk that cyber-attacks would be successful. To protect the Company’s business operations against disasters, we have a backup off-site core processing system and comprehensive recovery plans.
Below are details of the Company’s information security program:

Active Board engagement in the oversight of the Company’s information security risk management and cybersecurity programs

Quarterly Risk Committee updates from the COO with respect to Company information security risk and cybersecurity efforts including, among other things
 – 
systems performance and risk profile
 – 
system integration plans
 – 
business continuity planning
 – 
significant technology projects
 – 
third-party outsourcing arrangements (including our vendors)

Quarterly Information Security Officer Report updates to the Risk Committee that includes an assessment of the Company’s current security updates, cyber statistics and information-technology related emerging risks and trends with respect to current cyber/​information security practices

Annual independent penetration tests against the Company’s network

Annual independent vulnerability scans and Federal Financial Institutions Examination Council Cybersecurity Assessment Tool assessments

Participation in the Financial Services Information Sharing and Analysis Center that
 
28  |  PACWEST BANCORP  2021 PROXY STATEMENT

assists in the sharing of cyber and physical threat, vulnerability and incident information

Monitor Federal Bureau of Investigation, Cybersecurity and Infrastructure Security Agency/Department of Homeland Security cybersecurity alerts on a daily basis

Internal incident response team responsible for responding to cyber incidents

Routine strengthening of our security processes and controls

Testing of our Business Continuity/Disaster Recovery program on a regular basis, including independent third-party review and assessments
Social Responsibility
The Company’s business is built on our reputation and the trust and confidence our customers and stockholders place with us. It is essential that the Company uphold the highest standards of integrity, transparency and accountability. Listed below are
examples of the Company’s efforts to be a strong corporate citizen while enhancing long-term shareholder value. The information below highlights our impact during 2020.
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PACWEST BANCORP  2021 PROXY STATEMENT  |  29

Human Capital Management
Our business strategy is to operate a client-focused, well-capitalized and profitable nationwide bank dedicated to providing personal service to our business and individual customers. Our employees are our most important assets and they set the foundation for our ability to achieve our strategic objectives. We believe that we have a competitive advantage in the markets we serve because of our long-standing reputation for providing superior, relationship-based customer service. In order to continue to provide the expertise and customer service for which we are known, it is crucial that we continue to attract, retain and develop top talent. To facilitate talent attraction and retention, we strive to make a diverse, inclusive and safe workplace, with opportunities for our employees to grow and advance in their careers, supported by strong compensation, benefits and health and wellness programs.
Oversight and Management
We strive to attract, develop, and retain highly qualified employees for each role in the Company. Working under this principle, our Human Resources Department is tasked with managing employment-related matters, including recruiting and hiring, onboarding and training, compensation planning, diversity and inclusion matters, performance management and professional development. Our Board and Board committees provide oversight on certain human capital matters, including our compensation and benefit programs. As noted in its charter, the CNG Committee is responsible for periodically reviewing employee compensation programs and initiatives to ensure they are competitive and aligned with our stockholders’ long-term interests, including incentives and benefits, as well as our succession planning and strategies. Our Audit Committee works closely with the Risk Committee to monitor current and emerging human capital
management risks and to oversee management’s initiatives to mitigate exposure to those risks.
Human Capital Management Objectives

To support these objectives, our human resources programs are designed to develop talent to prepare them for critical roles and leadership positions for the future, reward and support employees through competitive pay, benefit, and perquisite programs, enhance the Company’s culture through efforts aimed at making the workplace more engaging and inclusive, acquire talent and facilitate internal talent mobility to create a high-performing, diverse workforce, and evolve and invest in technology, tools and resources to enable employees to effectively and efficiently perform their responsibilities and achieve their full potential.
Some examples of key programs and initiatives that are focused on attracting, developing and retaining our workforce include:

Compensation and benefits. The philosophy and objectives underlying our compensation programs are to employ and retain talented employees to ensure we execute on our business goals, drive short- and long-term profitable growth of the Company and create long-term stockholder value. In allocating total compensation, we seek to provide competitive levels of fixed compensation (base salary) and, through annual and long-term incentives, provide for increased total compensation when performance objectives are exceeded and appropriately lower total compensation if performance objectives are not met.
 
30  |  PACWEST BANCORP  2021 PROXY STATEMENT

WHAT WE DO

We provide employee wages that are competitive and consistent with employee positions, skill levels, experience, knowledge and geographic location

We engage nationally recognized outside compensation and benefits consulting firms to independently evaluate the effectiveness of our compensation and benefit programs and to provide benchmarking against our peers within the industry

Annual increases and incentive compensation are based on merit, which is communicated to employees at the time of hiring and documented through our talent management process as part of our annual review procedures and upon internal transfer and/or promotion

All full-time employees are eligible for health insurance (medical, dental & vision), paid and unpaid leave, a 401k plan with Company matching and life and disability/accident coverage. We also offer a variety of voluntary benefits that allow employees to select the options that meet their personal and family needs, including health savings and flexible spending accounts, paid parental leave, public transportation reimbursement, employee assistance programs, personalized wellness programs and a tuition reimbursement program

Health, Safety and Wellness. The health, safety and wellness of our employees is fundamentally connected to the success of our business. We provide our employees and their families with access to a variety of flexible, convenient and innovative health and wellness programs to help them improve or maintain their physical and mental well-being. The safety of our employees and customers is paramount. We strive to ensure that all employees feel safe in their respective work environment.

Talent Development. We believe that creating an environment which encourages continual learning and development is essential for us to maintain a high level of service and to achieve our goal to have every employee feel that they are a valued member of a successful company. Our
employees receive continuing education courses that are relevant to the banking industry and their job function within the Company. We also offer a tuition reimbursement program for courses that are relevant to banking and/or the employee’s job functions. We will also pay the tuition for eligible employees to attend a three-year banking program offered by certain universities. The goal of Talent Management @ PWB is to aspire, attract, engage, develop, and reward the best people to meet ongoing future growth of the Company with a collaborative and innovative culture. Our talent management processes and resources consist of three areas that support the ongoing high performance of all employees: Goal Setting, Performance Management and Professional Development.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  31

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Diversity and Inclusion

We recognize that a diversity of background, experience and perspective adds value and depth to our teams and creates better business results

We have a Senior Vice President of Diversity and Inclusion

We have a Diversity and Inclusion Advisory Council made up of 21 employee representatives from throughout the Company to advance our diversity and inclusion initiatives

We build teams and grow talent that reflect the diversity of the clients and communities we serve

We are committed to creating a culture of inclusion — where differences are both appreciated and respected

We take pride in providing equal employment opportunities and building a workplace culture where all employees feel supported and respected and have equal access to career and development opportunities without regard to race, religion/creed, color, national origin, age, marital status, ancestry, sex, gender (including pregnancy, childbirth, breastfeeding or related medical conditions), gender identity/expression, sexual orientation, veteran status, physical or mental disability, medical condition, military status or any other characteristic protected by federal, state or local laws

We actively support and partner with professional organizations that focus on increasing diversity within these sectors

We have a vendor sourcing initiative to provide visibility and access to certified diverse suppliers

We have a diverse workforce:
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Explore our 2020 Social Responsibility Highlights to learn more about our tangible commitment to community reinvestment, diversity and inclusion, sustainability and corporate governance, at https://www.pacwest.com/about-us/social-responsibility.
Communications with the Board
Stockholders interested in communicating with a director or with the directors as a group, or persons interested in communicating complaints to the Audit Committee concerning accounting, internal controls or auditing matters, may do so by writing:
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PacWest Bancorp
Attention: Corporate Secretary
9701 Wilshire Boulevard
Suite 700
Beverly Hills, California 90212
The Board has adopted a process for handling correspondence received by the Company and addressed to members of the Board. Under that process, the Corporate Secretary of the Company reviews all such correspondence and forwards to the Board a summary of all such correspondence and copies of all correspondence that, in the opinion of the Corporate Secretary, deals with the functions of the Board or committees thereof or that the Corporate Secretary otherwise determines requires the Board’s attention. Directors may, at any time, review a log of all correspondence received by the Company that is addressed to members of the Board and request copies of any such correspondence.
 
32  |  PACWEST BANCORP  2021 PROXY STATEMENT

Any concerns relating to accounting, internal controls or auditing matters are promptly brought to the attention of the Company’s General Counsel and/or other members of the Company’s management and handled in accordance with procedures established by the
Audit Committee with respect to such matters. These procedures include the ability to post reports anonymously via an internet-based tool or via a toll-free “hot-line” available to employees for purposes of reporting alleged or suspected wrongdoing.
Certain Relationships and Related-Party Transactions
RELATED-PARTY TRANSACTIONS POLICY
The Board-approved Related-Party Transactions Policy governs the approval of a Related Party Transaction (“RPT”) and prohibits a RPT unless they are approved or ratified by the Company’s Audit Committee. A RPT includes any transaction involving:

any director or nominee for director of, executive officer of, the Company or any of their Immediate Family Members (each such person, a “Parent Related Person”)

any entity for which any Parent Related Person is an executive officer or general partner (each, a “Parent Related Entity”)

any person/entity or affiliated group that beneficially owns 5% or more of the outstanding shares of Company common stock or any of their immediate family members (each, a “5% Owner”), and/or

Any other entity (A) where one or more Parent Related Persons, Parent Related Entities or 5% Owners individually or in the aggregate (aggregating the interests of all such persons), direct or indirectly, possesses a 10% or greater equity or voting interest, or (B) that is otherwise controlled by any one or more Parent Related Persons, Parent Related Entities or 5% Owners, individually or in the aggregate
These transactions need to be disclosed under Item 404(a) of Regulation S-K promulgated by the SEC. Such transactions do not include, however, indemnification payments or compensation paid to directors and executive officers for their services as directors and executive officers.
Our General Counsel, in consultation with management and outside counsel, analyzes all potential RPTs to determine whether a transaction constitutes a RPT. If a transaction is a RPT, the Audit Committee will review the transaction to determine whether to approve the transaction.
In making its determination, the Audit Committee considers several factors including, but not limited to:

Whether the terms of the RPT are fair to the Company and on the same basis as would apply if the transaction did not involve a related party

Whether there are business reasons for the Company to enter into the RPT

Whether the RPT would impair the independence of an outside director, and

Whether the RPT would present an improper conflict of interest for any director or executive officer of the Company, taking into account
 – 
the size of the transaction
 – 
the overall financial position of the director, executive officer, or other related party
 – 
the direct or indirect nature of the director, executive officer, or other related party’s interest in the transaction and
 – 
the ongoing nature of any proposed relationship and any other factors the Audit Committee deems relevant
Any member of the Audit Committee who has an interest in a transaction under review must abstain from voting on the RPT, but may, if the Audit Committee chairperson requests, participate in the Audit Committee’s discussion of the transaction.
2020 Related-Party Transactions
In 2020, Pacific Western Bank purchased $25,000,000 of senior debt securities of a bank holding company. Mr. Eggemeyer is a director of the bank holding company and its subsidiary bank, as well as the Managing Member of a fund that owns less than 10% of the outstanding equity of the bank holding company.
In 2020, Pacific Western Bank purchased $15,000,000 of subordinated debt securities of a bank holding company. Mr. Eggemeyer is a Managing Member of a fund that owns approximately 13.5% of the equity of the bank holding company.
In 2020, Pacific Western Bank purchased $5,000,000 of subordinated debt securities of a bank holding
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  33

company. Mr. Eggemeyer is a Managing Member of a fund that owns approximately 20% of the equity of the bank holding company.
In 2020, Pacific Western Bank purchased $4,500,000 of subordinated debt securities of a bank holding company. Mr. Eggemeyer is a Managing Member of a fund that owns approximately 27.4% of the equity of the bank holding company.
Pacific Western Bank was one of several purchasers of the debt securities in each of the offerings described above.
These purchases were undertaken without any involvement from Mr. Eggemeyer or the respective funds with respect to negotiating the terms of the relevant debt securities, which terms were determined on an arms’ length basis.
Family Relationships
There are no family relationships among any of the directors or executive officers of the Company.
Compensation Committee Interlocks and Insider Participation
During 2020, Messrs. Burke, Hosler, Molvar and Stine served on the CNG Committee. None of these current directors was formerly, or during 2020, an officer or employee of the Company or any of its subsidiaries.
No executive officer of the Company serves on the board of directors of any other company that has one or more executive officers serving as a member of the
CNG Committee. In addition, no executive officer of the Company serves as a member of the compensation committee of the board of any other company that has one or more executive officers serving as a member of the Board or the CNG Committee. No such interlocking relationships existed during 2020.
Stock Ownership Guideline for Non-Employee Directors
Position
Stock Ownership Guideline
Compliance Period
Non-employee directors    5x annual cash retainer 5 years from the later date of May 16, 2016 or joining the Board
In an effort to ensure that the interests of our non-employee directors are aligned with our stockholders, the Company established a non-employee director stock ownership guideline that expects non-employee directors to own shares equal to five times their annual cash retainer. Executive officers, including those serving as directors, are subject to stock ownership guidelines as described in the CD&A.
Non-employee directors are expected to meet this guideline within five years of the later of May 16, 2016 or the date of their election or appointment to the Board. As of the Record Date, other than one director who joined the Board in 2016 and one director who joined the Board in 2021, all of the non-employee director nominees meet the stock ownership guideline for non-employee directors.
Director Compensation
The CNG Committee evaluates director compensation and compares the Company’s director compensation to that offered by peer companies. The CNG Committee recommends to the Board director compensation, and the Board determines director compensation for each fiscal year. The compensation is designed to attract and retain qualified directors and to compensate them for the time and risk associated with being a
director. The Company reimburses its directors for reasonable travel, lodging, food and other expenses incurred in connection with their service on the Board and Board committees.
In 2020, the CNG Committee did not increase director cash retainers or annual equity grants. Below is the 2020 non-employee director compensation.
 
34  |  PACWEST BANCORP  2021 PROXY STATEMENT

2020 Non-Employee Director Compensation Table
The table below details all compensation paid to Company non-employee directors who served during 2020:
Name
Fees Earned or
Paid in Cash
($)
Stock Awards(1)
($)
All Other
Compensation
($)
Total
($)
John M. Eggemeyer, III, Chairman
172,000
113,987
8,660(2)
294,647
Tanya M. Acker
86,000
56,985
142,985
Paul R. Burke
126,000
56,985
182,985
Craig A. Carlson
126,000
56,985
182,985
C. William Hosler
126,000
56,985
182,985
Susan E. Lester
126,000
56,985
182,985
Arnold W. Messer
86,000
56,985
142,985
Roger H. Molvar
86,000
56,985
142,985
James J. Pieczynski(3)
Daniel B. Platt
86,000
56,985
142,985
Robert A. Stine
126,000
56,985
182,985
Matthew P. Wagner(3)
Mark T. Yung(3)
(1)
Amounts shown are based on the market value of the underlying stock on the date of grant. For further information, see Note 18. Stock-Based Compensation, to the Company’s audited financial statements for the year ended December 31, 2020 included in the Company’s Annual Report.
(2)
Represents life insurance premiums paid by the Company and personal use of an aircraft flight membership service.
(3)
No compensation received for service on the Board because individual is an employee director.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  35

 
EXECUTIVE COMPENSATION
Proposal 2―Advisory Vote on Executive Compensation
Pursuant to Section 14A of the Exchange Act, we are seeking advisory (non-binding) stockholder approval of the compensation of our named executive officers (“NEOs”).
This proposal gives you as a stockholder the opportunity to endorse or not endorse our NEO pay program through the following resolution:
“RESOLVED, that the compensation paid to the Company’s Named Executive Officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby Approved.”
Our stockholders approved our 2020 “say-on-pay” vote as a result of our corporate governance program and its alignment with our executive compensation. Our executive compensation corporate governance program includes:

Maintaining our proactive stockholder outreach

Aligning Company performance with stockholder interests for long-term stockholder value creation

Enhancing our Proxy Statement compensation disclosure

Enhancing our Proxy Statement disclosures to include cybersecurity, human capital management, social responsibility and COVID-19 impact and response disclosures

Clawback of incentive compensation for executives

Double-trigger equity awards in the event of a change of control
Over the past several years, we continued to enhance our compensation programs as a result of continued stockholder engagement, including this proposal, commonly known as a “say-on-pay” proposal that gives our stockholders the opportunity to express their views on the compensation of our NEOs. This vote is not intended to address any specific item of compensation, but rather our overall compensation philosophy and objectives with respect to our NEOs. Accordingly, your vote will not directly affect or otherwise limit any existing compensation or award arrangement of any of our NEOs.
As an advisory vote, this proposal is not binding upon the Board or the Company. The CNG Committee, however, values the opinions expressed by stockholders in their vote on this proposal and will consider the outcome of the vote when making future compensation decisions for NEOs. The Board believes that the compensation of the Company’s NEOs is appropriate and should be approved on an advisory basis by the Company’s stockholders as more particularly outlined in Compensation Discussion and Analysis beginning on page 42.
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The PacWest Board of Directors recommends a vote FOR approval of the compensation paid to the Company’s NEOs as disclosed in this Proxy Statement pursuant to the disclosure rules of the SEC, including the Compensation Discussion and Analysis, compensation tables and narrative discussion.
 
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Executive Officers
The following table sets forth: (i) each executive officer of the Company, (ii) his or her age as of the Record Date, (iii) the current position of each executive officer, and (iv) the period during which such person has served in such position. Following the table is a description of each executive officer’s principal occupation during the past five years.
Name
Age
Position
Year
Assumed
Current
Position
Year Hired by
the
Company(1)
William J. Black Jr.
45
Executive Vice President, Strategy and Corporate Development of the Company and Pacific Western Bank
2020
2020
Christopher D. Blake
61
Executive Vice President, President and Chief Executive Officer, Community Banking Group of the Company and Pacific Western Bank
2018
1994
Rebecca H. Cordes
65
Executive Vice President, Human Resources of the Company and Pacific Western Bank
2018
2018
Bryan M. Corsini
59
Executive Vice President and Chief Credit Officer of the Company and Executive Vice President of Pacific Western Bank
2014
2000
Stanley R. Ivie
61
Executive Vice President, Chief Risk Officer of the Company and Pacific Western Bank
2016
2016
Bart R. Olson
53
Executive Vice President, Chief Financial Officer of the Company and Pacific Western Bank
2021
2017
James J. Pieczynski(2)
58
Executive Vice President, Vice Chairman and Director of the Company and Pacific Western Bank
2018
2001
Monica L. Sparks
41
Executive Vice President, Chief Accounting Officer of the Company and Pacific Western Bank
2020
2020
Matthew P. Wagner
64
President and Chief Executive Officer and Director of the Company and Pacific Western Bank
2000
2000
Mark T. Yung(2)
47
Executive Vice President, Chief Operating Officer and Director of the Company and Pacific Western Bank
2019
2019
(1)
If the executive joined the Company through an acquisition or merger, the date indicates the date of hire at the predecessor company, and the years of service at the predecessor company are included in the date.
(2)
To further enhance the independence of the Board, the CNG Committee determined that it would not nominate Messrs. Pieczynski or Yung to the 2021 Board.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  37

 
William J. Black Jr.
Age 45
Executive Vice President, Strategy and Corporate Development of the Company and Pacific Western Bank
BACKGROUND
Mr. Black is Executive Vice President, Strategy and Corporate Development of the Company and Pacific Western Bank. From August 2008 until June 2020, Mr. Black was the founder and Managing Partner and Portfolio Manager at Consector Capital LP, a financial services hedge fund. Prior to founding Consector Capital LP, Mr. Black was Vice President with Castle Creek Capital LLC and a Managing Director at Second Curve Capital LLC. Earlier in his career, he worked in the equity research departments at Salomon Smith Barney and Putnam Lovell Securities, Inc. Between March 2016 and May 2020, Mr. Black served on the board of CalWest Bank and CalWest Bancorp where he served on the ALCO and Compensation Committees. Since 2015, Mr. Black has served as an Executive Board Member and Secretary for Watchung Hills Pop Warner, a youth organization that promotes football and cheer athletes through sports, competition, teamwork and community. Mr. Black graduated Phi Beta Kappa from The Johns Hopkins University with a B.A. in Economics and is a chartered financial analyst.
Christopher D. Blake
Age 61
Executive Vice President, President and Chief Executive Officer of the Community Banking Group of the Company and Pacific Western Bank
BACKGROUND
Mr. Blake is Executive Vice President, President and Chief Executive Officer of the Community Banking group of the Company and Pacific Western Bank. Mr. Blake served as Executive Vice President, Human Resources of the Company and Pacific Western Bank from April 2014 to November 2018. Mr. Blake has served on the board of directors for California Domestic Water Company, a wholesale water distribution company since November 18, 2016 and its wholly owned subsidiary Cadway, Inc. where he serves as a member of the Human Resources, Asset Management and Audit Committees. Mr. Blake was President of the Eastern Region of Pacific Western Bank when Pacific Western National Bank was acquired by the Company on January 31, 2002 and Mr. Blake served in that position until April 2014. Mr. Blake joined Pacific Western National Bank in October 1994 and served as chief credit officer until being appointed chief operating officer in December 1999.
Rebecca H. Cordes
Age 65
Executive Vice President, Human Resources of the Company and Pacific Western Bank
BACKGROUND
Ms. Cordes has served as Executive Vice President, Human Resources of the Company and Pacific Western Bank since December 2018. Ms. Cordes held various positions at First Western Financial, Inc. including, EVP, Director of Support Services, Director of Human Capital and Senior Operations Officer for First Western Capital Management, a registered investment advisory firm from 2008 to 2018. Prior to 2008, Ms. Cordes held various positions at US Bank over a 25 year period, including SVP/Senior Managing Director Private Client Group, SVP Regional Small Business Lending Manager, District Operations Sales and Services Manager, VP Human Resources and VP Director of Internal Audit. Ms. Cordes served on the Denver Metro Chamber Leadership Foundation Board of Directors from 2003 to 2012, including as the Board Chair from 2010 to 2011. Ms. Cordes served on the Rocky Mountain Junior Achievement board of directors where she served on the finance committee and executive committee from 2004 to 2016. Ms. Cordes was appointed in 2014 to the Colorado Commission on Affordable Health Care for a three year term by Governor John Hickenlooper.
 
38  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
Bryan M. Corsini
Age 59
Executive Vice President, Chief Credit Officer of the Company and Executive Vice President of Pacific Western Bank
BACKGROUND
Mr. Corsini is Executive Vice President and Chief Credit Officer of the Company and Executive Vice President of Pacific Western Bank. From May 2016 to October 2019, Mr. Corsini served as a Director of Pacific Western Bank. Mr. Corsini served as the Executive Vice President and Chief Administrative Officer of CapitalSource Bank from October 2011 to April 2014. Mr. Corsini previously served as President, Credit Administration of CapitalSource Bank from July 2008 to October 2011 and as Chief Credit Officer from CapitalSource Inc.’s inception in 2000 until July 2008. Mr. Corsini was an Executive Vice President with Fleet Capital Corporation, a commercial finance company from 1986 to 2000.
Stan R. Ivie
Age 61
Executive Vice President, Chief Risk Officer of the Company and Pacific Western Bank
BACKGROUND
Mr. Ivie is Executive Vice President, Chief Risk Officer of the Company and Pacific Western Bank. Mr. Ivie serves on the board of directors of the Western Bankers Association where he serves as vice chair at large on the Executive Committee, as a member of the Federal Government Relations Committee and he is on the board of directors of the Pacific Bankers Management Institute for Pacific Coast Banking School. Mr. Ivie served as the regional director for the Federal Deposit Insurance Corporation’s (“FDIC”) San Francisco Region from April 2007 to March 2016. Prior to serving as the regional director for the FDIC’s San Francisco Region, Mr. Ivie served as regional director for the FDIC’s Dallas Region. Prior to serving as regional director in the FDIC’s Dallas and San Francisco Regions, Mr. Ivie served as the deputy director for the Division of Resolutions and Receiverships (“Division”) where he directed field operations nationwide for the Division. Mr. Ivie also served in an interim capacity as director of the Office of Public Affairs in Washington, D.C. Mr. Ivie previously served in various capacities in Washington, D.C., including assistant director and senior congressional liaison for the Division.
Bart R. Olson
Age 53
Executive Vice President, Chief Financial Officer of the Company and Pacific Western Bank
BACKGROUND
Mr. Olson is Executive Vice President, Chief Financial Officer of the Company and Pacific Western Bank. From August 2020 to December 2020, Mr. Olson was Executive Vice President, Deputy Chief Financial Officer of the Company and the Bank. From February 2017 to August 2020, Mr. Olson was Executive Vice President, Chief Accounting Officer of the Company and Pacific Western Bank. Prior to joining the Company, Mr. Olson was a Managing Director at Credit Suisse Group where he was the Global Head of Liquidity Measurement and Reporting from March 2014 to February 2017 and served as the Deputy Controller Americas Region from May 2013 to March 2014. Prior to Credit Suisse, Mr. Olson spent twenty three years in public accounting, including fifteen years with KPMG LLP from 1998 to 2013, nine of which were as an audit partner. Mr. Olson is a Certified Public Accountant in California and member of the American Institute of Certified Public Accountants.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  39

 
James J. Pieczynski
Age 58
Executive Vice President, Vice Chairman and Director of the Company and Pacific Western Bank
BACKGROUND
Mr. Pieczynski is Executive Vice President, Vice Chairman of the Company and Pacific Western Bank since June 2018. Mr. Pieczynksi is a director of the Company and the Bank since 2014, where he served on several committees. Mr. Pieczynski was Executive Vice President of the Company and President of the CapitalSource Division of Pacific Western Bank from April 2014 to June 2018. Mr. Pieczynski served as a director of CapitalSource Inc. from January 2010 to April 2014 and as chief executive officer of CapitalSource Inc. from January 2012 to April 2014. Mr. Pieczynski also served as president of CapitalSource Bank from January 2012 to April 2014 and he was a member of the board of directors of CapitalSource Bank from January 2013 to April 2014. Mr. Pieczynski also serves on the board of directors, chairs the Nominating and Corporate Governance Committee and is a member of the Audit and Compensation Committees of LTC Properties, Inc., a self-administered real estate investment trust. Mr. Pieczynski also serves as a director for the Conejo Teen Organization, Inc. and Sherwood Cares, both of which are nonprofit organizations.
Monica L. Sparks
Age 41
Executive Vice President, Chief Accounting Officer of the Company and Pacific Western Bank
BACKGROUND
Ms. Sparks is Executive Vice President, Chief Accounting Officer of the Company and Pacific Western Bank. Between October 2018 to August 2020, Ms. Sparks was Senior Vice President, Chief Accounting Officer of American Business Bank. Previously, Ms. Sparks was Senior Vice President, Chief Accounting Officer of Hope Bancorp from December 2017 to September 2018. Ms. Sparks also was Senior Vice President, Controller of California United Bank from February 2014 to December 2017. Ms. Sparks also held various senior accounting roles with KPMG LLP between 2001 and 2014. Ms. Sparks graduated from the University of California, Los Angeles and is a Certified Public Accountant in California.
Matthew P. Wagner
Age 64
President, Chief Executive Officer and Director of the Company and Pacific Western Bank, and Chairman of the Board of Pacific Western Bank
BACKGROUND
Mr. Wagner is a Director of PacWest Bancorp and Chairman of the Board of Pacific Western Bank and is a member of each of their respective ALM, Risk and Executive Committees. Since 2000, Mr. Wagner has been the President and CEO of PacWest Bancorp and Pacific Western Bank.
 
40  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
Mark T. Yung
Age 47
Executive Vice President, Chief Operating Officer of the Company and Pacific Western Bank
BACKGROUND
Mr. Yung is Executive Vice President, Chief Operating Officer of the Company and Pacific Western Bank. Mr. Yung is a director of the Company and the Bank since May 2017, where he served on several committees. Since April 2019, Mr. Yung has served as director of Presbia PLC, an ophthalmic device company. Mr. Yung is executive chairman of the board of directors of Environmental Solutions Worldwide, Inc., a clean technology company focused on the reduction of diesel emissions. Prior to joining the Company, Mr. Yung was co-founder and managing principal of OCV Management, LLC, an investor, owner and operator of technology and life science companies based in Los Angeles. Mr. Yung served as managing director of Orchard Capital Corp. (“Orchard Capital”) a firm he joined in 2006. Mr. Yung served in various senior capacities including, among others, as chairman and chief executive officer of Presbia PLC, chief financial officer and director of Polymer Plainfield Holdings, Inc., an OEM automotive supplier with operations in the United States, Canada, Mexico and the Caribbean, chairman of the board of Vantage Surgical Systems, Inc., director of Red Carpet Cinema Corporation and as a director and/or officer of Coreolis Holdings and Tradewinds Holdings. Prior to joining Orchard Capital, Mr. Yung served as a senior vice president in the Corporate Strategy and Merger and Acquisitions groups of Citigroup in New York and ABN AMRO in Amsterdam, Netherlands. Prior to his corporate strategy roles, Mr. Yung served as an investment professional at JPMorgan Partners (“JPMP”). At JPMP, Mr. Yung focused on venture capital, growth equity and buyout transactions in Latin America and served as a board member for various emerging companies in the region. Mr. Yung began his career in 1996 at Chase Securities, Inc., focusing on leveraged finance for cross border buyouts and privatizations.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  41

 
Compensation Discussion and Analysis
This Compensation Discussion and Analysis (“CD&A”) explains our executive compensation program for our NEOs listed below. The CD&A also describes the
process followed by the CNG Committee for making compensation decisions as well as its rationale for making specific 2020 compensation decisions.
Name
Title
Matthew P. Wagner President and Chief Executive Officer of the Company and Pacific Western Bank
Patrick J. Rusnak(1) Executive Vice President, Chief Financial Officer of the Company and Pacific Western Bank
William J. Black Jr.(2) Executive Vice President, Strategy and Corporate Development of the Company and Pacific Western Bank
Christopher D. Blake
Executive Vice President, President and Chief Executive Officer, Community Banking Group of the Company and Pacific Western Bank
Mark T. Yung Executive Vice President, Chief Operating Officer of the Company and Pacific Western Bank
(1)
Mr. Rusnak was appointed Executive Vice President, Corporate Executive Administration on January 1, 2021 until his resignation on March 1, 2021.
(2)
Mr. Black was appointed Executive Vice President, Strategy and Corporate Development of the Company and Pacific Western Bank on July 1, 2020.
 
42  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
Executive Summary
2020 KEY PERFORMANCE HIGHLIGHTS
Despite the goodwill impairment and higher provisions for credit losses due primarily to the impacts of the COVID-19 pandemic, the Company continued its solid operating performance in key financial areas in 2020. Our financial performance below highlights the growth and continued success of our Company in the last five years.
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(1)
For more information regarding the calculation of these non-GAAP financial measures, please refer to the Calculation of Non-GAAP Financial Measures section below in this CD&A.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  43

 
COMPENSATION GOVERNANCE AND STOCKHOLDER ENGAGEMENT
As a result of continued stockholder outreach efforts as highlighted in the Stockholder Engagement section above, the CNG Committee approved the following mix of incentive metrics in the Executive Incentive Plan (“EIC Plan”) and Long-Term Incentive Plan (“LTI Plan”) as follows:
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SUMMARY OF OUR EXECUTIVE COMPENSATION PRACTICES
We believe the following governance practices and policies promote the accountability of our executive officers and strengthen the alignment of our executive officers and stockholder interests.
What We Do
What We Do Not Do
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Pay for performance―heavy emphasis on variable and “at risk” compensation
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Long-term incentive awards are equity-based
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Strong link between pay philosophy and strategic objectives
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Compensation program balances short- and long-term objectives
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Independent compensation consultant
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Maximum payout caps for incentive compensation
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Clawback policy for executive officer incentive compensation
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Double-trigger equity award provisions in the event of a change in control
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Payments of certain long-term incentive equity awards are deferred through vesting requirements
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Rigorous stock ownership guidelines for executive officers and independent directors
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Annual “say-on-pay” advisory vote
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CNG Committee composed solely of independent directors
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Anti-hedging and anti-pledging policy
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No excessive risk-taking behavior encouraged
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Other than the CEO succession arrangement with Mr. Wagner, no employment agreements or contracts
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No change of control tax gross-up payments
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No uncapped bonuses
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No bonus payouts if performance goals are not met
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No SERPs or deferred compensation arrangements
 
44  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
2020 COMPENSATION DECISIONS AT-A-GLANCE
The CNG Committee made the following executive compensation program payout decisions for 2020.
Element
2020 Compensation Decisions
Base Salary Except for Mr. Blake, none of the NEOs received base salary increases in 2020.
EIC Plan Financial performance in 2020 resulted in annual cash incentive payouts of 30.9% of target award opportunities.
LTI Plan The NEOs (other than Messrs. Black and Yung) received equity compensation for the 2018 Performance Period (January 1, 2018-December 31, 2020) granted in the form of 50% PRSUs. Consistent with the terms of the LTI Plan, the NEOs earned 29% of their targeted PRSUs for the 2018 Performance Period.
ONBOARDING MR. WILLIAM BLACK
On July 1, 2020, Mr. William Black was appointed as Executive Vice President, Strategy and Corporate Development of the Company and Pacific Western Bank. In connection with his hiring, Mr. Black received a base salary of $800,000 and a restricted stock grant of 110,550 shares on August 12, 2020.
Compensation Philosophy and Objectives
The philosophy and objectives underlying our executive compensation program are to:

employ the best leaders in our industry to ensure we execute on our business goals

drive short- and long-term profitable growth of the Company and

create long-term stockholder value
Our program is underpinned by the following guiding principles:
1
PAY FOR
PERFORMANCE
2
STOCKHOLDER
ALIGNMENT
3
ATTRACTION AND
RETENTION
4
RISK
MITIGATION
A significant portion of an executive officer’s total compensation should be variable and/or “at-risk” and dependent upon the attainment of certain specific and measurable performance objectives
Executive officers should be compensated through pay elements (base salaries, annual and long-term incentives) that, designed together, align total compensation with stockholder value creation
The executive compensation program should enable the Company to attract highly-talented people with exceptional leadership capabilities and retain high-caliber talent
Our executive compensation program should be guided by best-practice governance standards and rigorous processes that encourage prudent decision-making
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  45

 
Principal Elements of Compensation
The Company’s executive compensation program components are listed below. In allocating total compensation, we seek to provide competitive levels of fixed compensation (base salary) and, through short- and long-term incentives, provide for increased total compensation when performance objectives are
exceeded and appropriate lower award amounts if performance objectives are not met. In particular, if the Company achieves top-quartile results, our incentive program is designed to deliver top-quartile compensation outcomes.
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Pay Mix
A material portion of the target total compensation opportunity for each of our NEOs is directly tied to financial performance factors that measure our success relative to compensation plan performance goals and relative to peers. The charts below show the target
annual total direct compensation for our CEO and other NEOs for 2020. These charts illustrate that a significant amount of total direct compensation is variable (54% for our CEO and an average of 41% for our other NEOs).
TARGET PAY MIX(1)
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(1)
The NEO long-term incentive awards are structured so that approximately 50% is variable or “at risk” and approximately 50% is fixed. In 2020, Mr. Black received a TRSA grant, but he but did not receive a PRSU grant. Accordingly, the percentage of fixed versus variable long-term incentive compensation was 59% and 41%. Excluding Mr. Black, in 2020, the other three NEOs received variable long-term incentive compensation of 51% and fixed long-term incentive compensation of 49%.
 
46  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
Decision Making Process
ROLE OF THE CNG COMMITTEE
The CNG Committee oversees the NEO executive compensation program and is comprised of independent, non-employee members of the Board. The CNG Committee works closely with its independent compensation consultant and senior management to examine the effectiveness of the Company’s NEO executive compensation program throughout the year.
The CNG Committee has not established a policy or target for the allocation between cash and non-cash or short-term and long-term compensation. Rather, the CNG Committee undertakes a subjective analysis in light of the philosophy and objectives described in this CD&A and, in connection with its analysis, reviews and considers information provided by its independent compensation consultant and surveys to determine the appropriate level and mix of base compensation, performance-based pay and other elements of compensation. The CNG Committee reviews both compensation and performance of peer companies as just one among several factors to inform its decision-making process so it can set total compensation levels commensurate with the Company’s performance and strategic initiatives.
The CNG Committee makes all final NEO compensation and equity award decisions except for the CEO, whose compensation is determined by the independent members of the Board based upon the recommendation of the CNG Committee.
ROLE OF SENIOR MANAGEMENT
Members of our executive management team attend regular meetings in which executive compensation, Company performance, individual performance and competitive compensation levels and practices are
discussed and evaluated. Only the CNG Committee members can vote on decisions regarding NEO compensation. The CEO does not participate in the deliberations of the CNG Committee with respect to his compensation.
ROLE OF THE INDEPENDENT CONSULTANT
The CNG Committee engages an independent compensation consultant to provide expertise on executive and director compensation matters. Pursuant to authority granted to it under its charter, the CNG Committee retained Pearl Meyer as its independent consultant for 2020. Pearl Meyer has served as our independent compensation consultant since 2018. Pearl Meyer reports directly to the CNG Committee and does not provide any additional services to management. The CNG Committee has conducted an independence assessment of Pearl Meyer in accordance with SEC and Nasdaq listing rules. Based on this review, we are not aware of any conflict of interest raised by the work performed by Pearl Meyer that would prevent the consultant from serving as an independent compensation consultant to the CNG Committee.
In 2020, the CNG engaged Pearl Meyer to conduct a review with respect to, among other things: (i) the current compensation arrangements for certain Company executives, (ii) peer and broader survey market data with respect to executive compensation practices, and (iii) the competitiveness of the Company’s executive compensation program. In 2020, the CNG Committee and Pearl Meyer engaged in numerous discussions with respect to terms in relation to Mr. Wagner’s succession arrangement including Mr. Wagner’s anticipated retirement on December 31, 2023 as Chief Executive Officer and President of the Company and Pacific Western Bank.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  47

 
Peer Group
Periodically, we review our peer group to ensure our compensation is being benchmarked to comparable companies considering industry, financial and operational similarities. In February 2020, Pearl Meyer conducted a comprehensive review of the Company’s prior compensation peer group and proposed adjustments for consideration by the CNG Committee
and management. Following this review, it was determined that for purposes of evaluating compensation opportunities for 2020, three of the prior peers would be replaced with companies that were determined to be more relevant from size and business model perspectives.
3 removed
+ 3 added

Synovous Financial Corp.

Home BancShares, Inc.

TCF Financial Corporation

Simmons First National Corporation

Texas Capital Bancshares, Inc.

Sterling Bancorp
The resulting peer group included the following companies:
Peer Group

Bank OZK

Signature Bank

BankUnited, Inc.

Simmons First National Corporation

BOK Financial Corporation

Sterling Bancorp

Commerce Bancshares, Inc.

UMB Financial Corporation

Cullen/Frost Bankers, Inc.

Umpqua Holdings Corporation

East West Bancorp, Inc.

Valley National Bancorp

Hancock Whitney Corporation

Webster Financial Corporation

Home BancShares, Inc.

Western Alliance Bancorporation

Pinnacle Financial Partners, Inc.

Wintrust Financial Corporation

Prosperity Bancshares, Inc.
The companies comprising the peer group generally have similar commercial banking business models and are of similar size (i.e., total assets, market capitalization, and revenue).
2020 Executive Compensation Decisions
BASE SALARY
NEO base salaries are set at levels that are intended to reflect the competitive marketplace in attracting, retaining, motivating and rewarding high performing executive officers. In determining base salaries, the CNG Committee considers the following elements:

individual performance based on experience and scope of responsibility

non-financial performance indicators including strategic developments for which an executive officer has responsibility and managerial performance

structure and complexity of the Company

compensation paid by peers

functionality of the executive management team

economic conditions in the Company’s market areas

analyses or guidance from the independent compensation consultant
With the exception of Mr. Wagner, whose base salary is determined by the Board, the CNG Committee is responsible for setting the NEOs’ base salaries. The base salaries are intended to compensate the NEOs for the day-to-day services performed for the Company.
Other than Mr. Blake, none of the NEOs received base salary increases in 2020. Below are NEO base salaries for 2019 and 2020.
 
48  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
NEO
2019 Base Pay(1)
($)
2020 Base Pay(1)
($)
% Change
Matthew P. Wagner
1,000,000
1,000,000
0%
Patrick J. Rusnak
600,000
600,000
0%
William J. Black Jr.(2)
800,000
Christopher D. Blake
525,000
575,000
~10%
Mark T. Yung
800,000
800,000
0%
(1)
Amounts in table represent NEO base salaries at the end of the period presented.
(2)
Mr. Black was appointed Executive Vice President, Strategy and Corporate Development of the Company and Pacific Western Bank on July 1, 2020.
ANNUAL CASH INCENTIVES
The NEOs are eligible to earn performance-based annual cash incentives, which are awarded under the Company’s EIC Plan. Target award opportunities are expressed as a percentage of base salary and final award payouts are based on pre-determined financial
performance objectives. At the end of the performance year, the CNG Committee may, at its sole discretion, adjust the maximum award amount upward from 150% to 200% for the ROTCE measurement if ROTCE performance achieves certain rigorous absolute and relative performance hurdles. See the table below for the range of payouts for our executive officers.
TARGET AWARD OPPORTUNITIES
Target annual incentive opportunities are expressed as a percentage of base salary at year end and established according to each NEO’s level of responsibility. For 2020, incentive award opportunities were as follows.
Annual Incentive Opportunity, as a Percentage of Base Salary
NEO
Below
Threshold
Threshold
Award
Target Award
Maximum
Award
CEO
0%
75%
150%
225%
COO
0%
62.5%
125%
187.5%
Other NEOs (excluding the COO)
0%
50%
100%
150%
Note: Actual award payouts will generally be interpolated between threshold and target and between target and maximum.
2020 PERFORMANCE MEASURES, WEIGHTS, OBJECTIVES AND RESULTS
The CNG Committee establishes performance measures and objectives on an annual basis. For 2020, the CNG Committee did not make any changes to EIC Plan performance measures or payout levels. The CNG Committee believes the 2020 performance measures continue to ensure the EIC Plan remains
aligned with the priorities—profitability, efficient operations, responsible growth, and safety and soundness—that support our overall business strategy and drive long-term stockholder value creation. The following table shows the financial performance requirements to achieve threshold, target and maximum bonus payouts together with actual results for 2020. Individual targets change year over year and reflect changes to the Company’s business operations.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  49

 
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(1)
As reported in the Company’s 10-K for the year ended December 31, 2020.
(2)
Average total loan balance for 2020.
Based on the Company’s performance described above, the CNG Committee approved overall annual incentive award payouts of 30.9% of target. Actual award payouts are summarized below.
Cash Incentive Opportunity Based Upon
Actual Cash Incentive Paid
Based on 2020 Performance
($)
NEO
Target
($)
Matthew P. Wagner
1,500,000
463,500
Patrick J. Rusnak
600,000
185,400
William J. Black Jr.
800,000
124,275
Christopher D. Blake
575,000
177,675
Mark T. Yung
1,000,000
309,000
LONG-TERM INCENTIVE PLAN (“LTI PLAN”) OVERVIEW
We provide a meaningful portion of NEO compensation in the form of long-term, equity incentive compensation. Under the Company’s LTI Plan, equity awards were granted using a mix of PRSUs and TRSAs for 2020 as follows.
 
50  |  PACWEST BANCORP  2021 PROXY STATEMENT

 
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(1)
The weightings may be slightly higher or lower depending on the closing price of the Company’s stock price on the grant date, and, with respect to relative TSR, the grant date fair value per PRSU. Accordingly, the grant date award amounts will equal 50% of the total award value, but the number of shares may vary.
(2)
Relative TSR will be subject to a maximum payout at target if the Company’s absolute TSR is negative.
 
PACWEST BANCORP  2021 PROXY STATEMENT  |  51

 
The table below shows the target long-term incentive awards granted for 2020 to each of the NEOs.
NEO
Target Opportunity
(as a Percentage of
Base Salary)
Date of Grant
Target
PRSUs(1)
(#)
TRSAs(2)
(#)
Total Target
Equity Grant
(#)
Matthew P. Wagner
300%
2/12/2020
41,900
41,581
83,481
Patrick J. Rusnak
200%
2/12/2020
16,760
16,632
33,392