COMMUNITY WEST BANCSHARES (CWBC)
Sector: Financials
2026 Annual Meeting Analysis
COMMUNITY WEST BANCSHARES · Meeting: May 27, 2026
Directors FOR
11
Directors AGAINST
2
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Directors of the Company
Against Analysis
Mr. Bartlein was appointed on April 1, 2024, meaning his tenure is approximately 25 months as of the May 2026 meeting, which is just over the 24-month new-director exemption window; however, because he joined after most of the underperformance period was already established and his tenure covers less than half the 3-year measurement window, the trigger is flagged but the vote is FOR with mitigating context noted.
For Analysis
While CWBC's 3-year return trailed the peer group median by 54.1 percentage points (exceeding the 50pp trigger for companies with strong positive returns), the 5-year record shows a gap of only 25.8 percentage points below the peer median, which is below the 50pp threshold, indicating the recent underperformance is not part of a sustained long-term pattern; the 5-year mitigant applies and the vote is FOR.
The 3-year TSR underperformance trigger fires for all long-tenured directors, but CWBC's 5-year return trails the peer median by only 25.8 percentage points, well below the 50pp threshold required to sustain a No vote; the 5-year mitigant applies and the vote is FOR.
Mr. Gill was appointed to the board on April 1, 2026, fewer than two months before the annual meeting, so he is fully exempt from the TSR performance trigger under the 24-month new-director rule; no other policy concerns identified.
As CEO and a director, Mr. Kim is subject to the same TSR trigger as other directors, and the 3-year underperformance gap of 54.1 percentage points exceeds the 50pp threshold; however, the 5-year gap of 25.8 percentage points falls below the 50pp mitigant threshold, indicating the underperformance is a more recent development against an otherwise adequate longer-term track record, so the vote is FOR.
Mr. Lokey was appointed on April 1, 2024, giving him approximately 25 months of tenure; because he joined after the bulk of the 3-year underperformance period was already established and the 5-year gap of 25.8 percentage points does not exceed the 50pp mitigant threshold, the vote is FOR.
Ms. Majarian has served since 2020, giving her full tenure overlap with the underperformance period, and the 3-year trigger fires; but the 5-year relative TSR gap of 25.8 percentage points is below the 50pp mitigant threshold, so the 3-year underperformance appears to be a recent development within an otherwise adequate longer-term record, and the vote is FOR.
Mr. McDonald has served since 2000, so he has full tenure overlap; the 3-year underperformance trigger fires, but the 5-year gap of 25.8 percentage points falls below the 50pp mitigant threshold, meaning the underperformance is recent rather than sustained, and the vote is FOR.
Mr. Plourd was appointed on April 1, 2024, so his tenure just exceeds the 24-month exemption window; he joined after most of the 3-year underperformance was already in place, and the 5-year gap of 25.8 percentage points is below the 50pp mitigant threshold, so the vote is FOR.
Ms. Silva has served since 2020 with full tenure overlap; the 3-year trigger fires, but the 5-year gap of 25.8 percentage points falls below the 50pp threshold, indicating the recent underperformance does not reflect a sustained multi-year pattern, and the vote is FOR.
Mr. Stovesand was appointed on April 1, 2024, just over the 24-month exemption; because he joined after much of the underperformance period was already established and the 5-year gap of 25.8 percentage points does not exceed the 50pp mitigant threshold, the vote is FOR.
Ms. Westerlund was appointed on April 1, 2026, fewer than two months before the annual meeting, so she is fully exempt from the TSR performance trigger under the 24-month new-director rule; no other policy concerns identified.
All 13 nominees receive a FOR vote. The 3-year TSR underperformance trigger fires for long-tenured directors (CWBC's 3-year return trailed the peer group median by 54.1 percentage points, exceeding the 50pp threshold for companies with strong positive absolute returns), but the 5-year mitigant applies across the board because the 5-year gap of 25.8 percentage points falls below the 50pp threshold, indicating recent rather than sustained underperformance. Two directors appointed April 1, 2026 (Gill, Westerlund) are fully exempt as new directors. Directors appointed April 1, 2024 (Bartlein, Lokey, Plourd, Stovesand) joined after most of the underperformance was already established, providing additional mitigating context. No overboarding, attendance, independence, or qualification concerns were identified.
Say on Pay
✓ FORCEO
James J. Kim
Total Comp
$1,264,784
Prior Support
95.3%%
CEO James J. Kim's total compensation of $1,264,784 is reasonable for a community bank CEO at a $649 million market cap company, and the prior Say on Pay vote received strong support of 95.3%, indicating shareholders were broadly satisfied with the program. The pay mix is appropriately structured with a meaningful portion in variable pay — annual cash incentives tied to pre-set financial goals (net income, loan growth, deposit growth, asset quality, efficiency) plus time-vested restricted stock — and the company maintains a formal clawback policy adopted in December 2023 in compliance with SEC and Nasdaq requirements. Annual incentive payouts at 100% of target for most executives were supported by solid 2025 financial results including net income of $38.2 million and loan growth of 8.77%, and the Compensation Committee exercised limited upward discretion for the CEO that was modest relative to total pay and clearly disclosed.
Auditor Ratification
✓ FORAuditor
Baker Tilly US, LLP
Tenure
N/A
Audit Fees
$840,000
Non-Audit Fees
$61,500
Non-audit fees (audit-related fees of $17,500 plus tax fees of $44,000 = $61,500) represent approximately 7.3% of audit fees ($840,000), well below the 50% threshold that would raise independence concerns; auditor tenure is not explicitly disclosed (the relationship was with predecessor firm Moss Adams LLP, acquired by Baker Tilly in June 2025, so confirmed tenure cannot be determined and no No vote is triggered on tenure grounds), and no material restatements were disclosed.
Overall Assessment
The 2026 CWBC annual meeting presents three standard proposals — director elections, auditor ratification, and Say on Pay — with no stockholder proposals on the ballot. All proposals receive a FOR vote: the director slate passes because the 5-year TSR mitigant neutralizes the 3-year underperformance trigger that would otherwise fire for long-tenured directors, the auditor ratification passes with non-audit fees well within acceptable limits, and Say on Pay passes given a reasonable pay structure, strong prior-year shareholder support, and performance-linked incentives.
Compensation Peer Group
13 companies disclosed in 2026 proxy filing