Form 4: Columbia Financial Officer Acquires Phantom Stock

John Klimowich, SEVP & Chief Risk Officer of Columbia Financial, Inc., acquired 42.5356 shares of common stock through a non-discretionary deferral plan.

Summary

• John Klimowich, SEVP & Chief Risk Officer of Columbia Financial, Inc. (CLBK), acquired 42.5356 shares of common stock on September 5, 2025, at a price of $15.01 per share.
• This acquisition was made through the Columbia Bank Stock Based Deferral Plan, a non-qualified stock-based deferral plan, where phantom stock was purchased by the trustee of the Bank's rabbi trust.
• Following this transaction, Mr. Klimowich's indirect beneficial ownership in the Stock-Based Deferral Plan increased to 7,807.5331 shares.
• Mr. Klimowich also holds significant direct and indirect beneficial ownership in common stock through various plans, including 60,769 direct shares, 17,130 shares via 401(k), 7,620 via ESOP, 7,051 via SERP, 4,214 via SIM, 13,781 via Stock Award II, 12,068 via Stock Award III, and 11,723 via Stock Award IV.
• He holds several stock options under the 2019 Equity Incentive Plan, including 188,235 fully vested options at $15.6, 12,030 options at $15.94 vesting from May 1, 2024, 8,850 options at $16.49 vesting from March 6, 2025, and 20,310 options at $16.23 vesting from March 3, 2026.
• Stock Awards II, III, and IV have various vesting schedules, including both time-based and performance-based criteria, with some performance-based awards vesting three years after the award date if criteria are met.

Sentiment

Score: 6

Explanation: The filing is neutral to slightly positive, as it indicates an executive's continued participation in the company's long-term incentive plans, which aligns management interests with shareholders. However, it's a routine disclosure and doesn't contain significant new operational or financial news.

Positives

• The acquisition of phantom stock by a key executive indicates continued participation in the company's long-term incentive plans.
• The non-discretionary nature of the purchase through a deferral plan suggests a structured approach to executive compensation and alignment with shareholder interests.
• The existence of multiple stock awards and options, some with performance-based vesting, incentivizes management to achieve specific company goals.

Future Outlook

The filing details future vesting schedules for various stock options and awards, indicating ongoing long-term incentive plans for the executive, with some awards contingent on achieving specified performance-based criteria over a three-year period.

Industry Context

This Form 4 filing is a standard disclosure of executive stock transactions, common in the financial services industry. It reflects Columbia Financial, Inc.'s use of equity-based compensation, including phantom stock, stock options, and performance-based awards, to align executive incentives with company performance and shareholder value, a prevalent practice among publicly traded banks and financial institutions.

Comparison to Industry Standards

• The use of a Stock-Based Deferral Plan, 401(k), ESOP, SERP, and SIM for executive compensation is consistent with common practices in the U.S. banking sector, similar to plans offered by regional banks like Provident Financial Services or Lakeland Bancorp.
• The structure of equity incentive plans, including time-based and performance-based vesting for stock options and awards, aligns with corporate governance best practices aimed at long-term value creation, comparable to those seen in larger financial institutions such as M&T Bank or Webster Financial Corporation.
• The specific strike prices and vesting schedules for stock options are typical for executive grants, reflecting market conditions and internal compensation strategies at the time of grant.

Corporate Governance

Related Party Transactions

• John Klimowich, an executive, acquired phantom stock from Columbia Financial, Inc. as part of the Columbia Bank Stock Based Deferral Plan, which is a related party transaction inherent in executive compensation structures.

Stakeholder Impact

• Shareholders: The executive's continued participation in equity incentive plans aligns management interests with shareholder value creation. The performance-based vesting criteria could motivate management to achieve company goals beneficial to shareholders.
• Employees: The existence of various employee and executive stock plans (401k, ESOP, SERP, SIM) indicates a broad approach to employee ownership and incentives.

Next Steps

• The phantom stock units under the Columbia Bank Stock Based Deferral Plan will be settled in shares of stock upon distribution to the reporting person.
• Certain stock options will continue to vest in approximately equal annual installments commencing on May 1, 2024, March 6, 2025, and March 3, 2026.
• Portions of Stock Awards II and III will vest in three approximately equal annual installments commencing on May 1, 2024, and March 6, 2025, respectively.
• The remaining 75% of Stock Awards II and III, and all of Stock Award IV, are subject to vesting upon achievement of specified performance-based criteria, which if achieved, would vest three years after the award date (e.g., March 3, 2028 for Stock Award IV).

Key Dates

Recommendation

This Form 4 filing is a routine disclosure of an executive's acquisition of phantom stock as part of a compensation plan. It does not contain new material information regarding the company's financial performance, strategic direction, or significant operational changes that would warrant a change in investment recommendation. The transaction reflects an expected component of executive compensation and aligns management incentives with long-term company performance, which is generally a neutral to slightly positive factor. Therefore, a 'hold' recommendation is appropriate as the filing does not provide a catalyst for a 'buy' or 'sell' decision.

Keywords

Columbia Financial, CLBK, John Klimowich, SEC Form 4, Beneficial Ownership, Stock Options, Equity Incentive Plan, Phantom Stock, Executive Compensation, Stock Awards, Chief Risk Officer