FLAGSTAR BANK NATIONAL ASSOCIATION (FLG)
Sector: Financials
2026 Annual Meeting Analysis
FLAGSTAR BANK NATIONAL ASSOCIATION · Meeting: June 9, 2026
Directors FOR
1
Directors AGAINST
7
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Eight Directors to One-Year Terms
Against Analysis
Mr. Berlinski joined the board in 2024, and while the 24-month exemption is borderline, he has now served long enough that the severe 3-year TSR underperformance trigger applies — Flagstar's stock fell roughly 45% while the company's own compensation peer group (banks like Citizens, M&T, KeyCorp, and others) rose a median of about 109%, a gap of over 153 percentage points, far exceeding the 20-percentage-point threshold; additionally, his biography lists board seats at Russell Investments, Venerable Holdings, Osaic, DMG Bancshares, Ministry Brands, Allspring, CAIS, SEIA, EverBank, Sunstar Insurance Group, and Envestnet, suggesting a very high number of concurrent board commitments that raise overboarding concerns.
Mr. Frank has served since 2024 and the severe stock underperformance trigger applies — Flagstar's shares declined about 45% over three years while the company's disclosed peer group of regional banks gained a median of roughly 109%, a gap exceeding 153 percentage points against the 20-percentage-point policy threshold; the 5-year check does not provide a mitigant because the 5-year return of -53% is even worse, confirming sustained rather than transient underperformance.
Mr. Lux has served since 2022, meaning his tenure fully overlaps the three-year period during which Flagstar's stock fell about 45% while the company's own peer group of regional banks gained a median of roughly 109% — a gap of more than 153 percentage points, vastly exceeding the 20-percentage-point threshold that applies when a stock's absolute return is negative; the 5-year data (-53% absolute) confirms this is sustained underperformance, not a temporary dip.
Secretary Mnuchin has served since 2024, and over that period Flagstar's stock fell roughly 45% while the company's disclosed peer group of regional banks rose a median of about 109%, a gap of over 153 percentage points against a 20-percentage-point policy threshold; the 5-year return of -53% confirms the underperformance is sustained, not a recent blip, so the 5-year mitigant does not apply.
Mr. Otting joined the board in March 2024 as the incoming CEO, and while he arrived after the worst of the bank's problems, he has now served more than 24 months and the TSR trigger applies — during the three-year measurement period Flagstar's stock fell roughly 45% while the company's own peer group gained a median of about 109%, a gap of over 153 percentage points; as an executive director he is subject to the same TSR accountability standard as all other directors, independent of the Say on Pay vote determination.
Mr. Puwalski has served since 2024, and Flagstar's stock fell about 45% over the three-year measurement period while the company's own disclosed peer group of regional banks gained a median of roughly 109%, a gap of more than 153 percentage points against the 20-percentage-point policy threshold; the 5-year performance (-53%) is worse still, ruling out the 5-year mitigant.
Ms. Whip has served since 2022, giving her the longest tenure overlap with the three-year underperformance period during which Flagstar's stock declined about 45% while the company's own peer group of regional banks rose a median of roughly 109% — a gap of over 153 percentage points, far exceeding the 20-percentage-point threshold; the 5-year return of -53% confirms this is not a temporary shortfall.
For Analysis
Mr. Miller joined the board in 2026 and is therefore exempt from the TSR underperformance trigger under the policy's 24-month new-director exemption; he brings relevant government, Treasury, and investment experience appropriate for a large regulated bank.
All eight director nominees trigger the TSR underperformance policy because Flagstar's stock declined roughly 45% over three years while its own disclosed compensation peer group of regional banks rose a median of about 109%, producing a gap of more than 153 percentage points — far above the 20-percentage-point threshold that applies when absolute returns are negative. The sole exception is Eli Miller, who joined in 2026 and is exempt under the 24-month new-director rule. The 5-year return of -53% rules out the mitigant that would apply if 3-year underperformance were a recent and temporary development. Milton Berlinski also raises overboarding concerns given his extensive list of concurrent board seats.
Say on Pay
✓ FORCEO
Joseph M. Otting
Total Comp
$7,655,500
Prior Support
strong majority (specific percentage not disclosed)%
The proxy states that a strong majority of votes were cast in favor of Say on Pay at the 2025 annual meeting, so the prior-year support threshold that would trigger a No vote (below 70%) is not met. The CEO's total pay of $7,655,500 for 2025 — composed of $1,250,000 base salary (about 16% of total), $3,000,000 in stock awards, and $3,375,000 in cash incentive — reflects a heavily variable pay mix (approximately 85% at-risk) that is consistent with the policy's requirement that at least 50-60% of senior executive pay be performance-linked. The proxy discloses a meaningful clawback policy meeting Dodd-Frank requirements, stock ownership guidelines, and anti-hedging provisions, and the 2025 incentive payout (150% of target for the CEO) is tied to documented operational achievements including a return to Q4 profitability, a 100-basis-point improvement in the CET1 capital ratio, and an $683 million reduction in operating expenses, which represent credible turnaround milestones even though multi-year stock performance remains deeply negative.
Auditor Ratification
✓ FORAuditor
KPMG LLP
Tenure
N/A
Audit Fees
$8,585,000
Non-Audit Fees
$425,400
The non-audit fees paid to KPMG ($425,400, consisting of benefit plan and HUD compliance audits) represent about 5% of the core audit fees ($8,585,000), well below the 50% threshold that would raise independence concerns; auditor tenure is not disclosed in the filing so the tenure trigger cannot be applied and policy requires a FOR vote in that circumstance; KPMG is a Big 4 firm fully appropriate for a bank with $87.5 billion in assets.
Overall Assessment
The 2026 Flagstar Bank annual meeting presents a ballot where the TSR underperformance trigger fires against nearly the entire director slate — Flagstar's stock lost roughly 45% over three years while its own peer group of regional banks gained a median of about 109%, a gap of over 153 percentage points — resulting in AGAINST votes for seven of eight director nominees (the sole exception being newly appointed Eli Miller who is exempt). The auditor ratification passes cleanly with a low non-audit fee ratio, and Say on Pay receives a FOR determination based on a defensible at-risk pay structure, strong prior-year shareholder support, and documented turnaround progress in 2025.
Compensation Peer Group
14 companies disclosed in 2026 proxy filing