Banc of California, Inc. (NYSE: BANC):
$0.17 Earnings Per Share
$0.19 Adjusted Earnings Per Share(1)
$17.18 Book Value Per
Share $15.07 Tangible Book Value Per Share(1)
10.12% CET1 Ratio
27% Noninterest-Bearing
Deposits
Banc of California, Inc. (NYSE: BANC) (“Banc of California”),
the parent company of wholly-owned subsidiary Banc of California
(the “Bank”), today reported financial results for the first
quarter ended March 31, 2024. The Company recorded net earnings
available to common and equivalent stockholders of $28.2 million,
or $0.17 per diluted common share, for the first quarter of 2024.
On an adjusted basis, excluding the FDIC special assessment accrued
for the first quarter, net earnings available to common and
equivalent stockholders was $31.7 million, or $0.19 per diluted
common share(1). This compares to a net loss of $492.9 million, or
a loss of $4.55 per diluted common share, for the fourth quarter of
2023. The fourth quarter of 2023 included pre-tax amounts of $442.4
million of losses on security sales relating to our balance sheet
repositioning strategy, merger costs of $111.8 million, and an FDIC
special assessment of $32.7 million.
First quarter highlights include:
- Net interest income increased by $88.1 million, or 58%,
in the first quarter to $239.1 million, reflecting the benefits of
our balance sheet repositioning which continued into the first
quarter.
- Net interest margin of 2.78%, an increase of 109 basis
points from 1.69% in the fourth quarter.
- The average total cost of deposits decreased by 28 basis
points to 2.66% for the first quarter compared to 2.94% in the
fourth quarter.
- Improved overall deposit mix, with noninterest-bearing
deposits increasing over $59 million in the first quarter and the
noninterest-bearing percentage of total deposits increasing from
26% at December 31, 2023 to 27% at March 31, 2024.
- Noninterest expenses declined by over $41 million to
$210.5 million (excluding merger costs).
- High liquidity levels, with available on-balance sheet
liquidity and unused borrowing capacity of $16.8 billion at March
31, 2024, which was 2.4 times greater than uninsured and
uncollateralized deposits.
- Allowance for credit losses of 1.26% at March 31, 2024,
up from 1.22% at December 31, 2023, after a first quarter provision
for credit losses of $10.0 million.
- Net charge-offs of $1.2 million, or 2 basis points of
average loans and leases.
- Strong capital ratios well above the regulatory
thresholds for "well capitalized" banks at March 31, 2024,
including an estimated 16.43% Total risk-based capital ratio,
12.41% Tier 1 capital ratio, 10.12% CET1 capital ratio, and 9.14%
Tier 1 leverage ratio.
- Book value per share increased to $17.18 and tangible
book value per share(1) increased to $15.07.
(1)
Non-GAAP measure; refer to
section 'Non-GAAP Measures'
Jared Wolff, President & CEO of Banc of California,
commented, “Our first full quarter results as a combined company
reflect strong execution on the key initiatives that will lead to
achieving the profitability targets we set for the fourth quarter
of 2024. We began to realize the benefits of the balance sheet
repositioning following the closing of the merger and generated a
significantly higher level of net interest income and significantly
lower operating expenses. Our deposit gathering engine generated an
increase in noninterest-bearing deposits during the first quarter,
which contributed to a lower average cost of deposits and the
expansion in our net interest margin.”
Mr. Wolff continued, “We are positioned with a strong balance
sheet that has good levels of capital, liquidity, and loan loss
reserves, and a stable loan portfolio. While remaining disciplined
and conservative in new loan originations, core loans grew 4%
annualized in the quarter, offset by runoff in our discontinued
portfolio. We are benefitting from our market position, seeing good
opportunities to bring over new banking relationships that provide
both operating deposit accounts and high-quality loans. We remain
on track with our initiatives to reduce both interest expense and
operating expenses and expect to make steady progress as we move
through the year toward our stated profitability targets.”
INCOME STATEMENT HIGHLIGHTS
Three Months Ended
March 31,
December 31,
March 31,
Summary Income Statement
2024
2023
2023
(In thousands) Total interest income
$
488,750
$
467,240
$
517,788
Total interest expense
249,602
316,189
238,516
Net interest income
239,148
151,051
279,272
Provision for credit losses
10,000
47,000
3,000
(Loss) gain on sale of loans
(448
)
(3,526
)
2,962
Loss on sale of securities
-
(442,413
)
-
Other noninterest income
34,264
45,537
33,429
Total noninterest income (loss)
33,816
(400,402
)
36,391
Total revenue
272,964
(249,351
)
315,663
Goodwill impairment
-
-
1,376,736
Acquisition, integration and reorganization costs
-
111,800
8,514
Other noninterest expense
210,518
251,838
187,753
Total noninterest expense
210,518
363,638
1,573,003
Earnings (loss) before income taxes
52,446
(659,989
)
(1,260,340
)
Income tax expense (benefit)
14,310
(177,034
)
(64,916
)
Net earnings (loss)
38,136
(482,955
)
(1,195,424
)
Preferred stock dividends
9,947
9,947
9,947
Net earnings (loss) available to common and equivalent stockholders
$
28,189
$
(492,902
)
$
(1,205,371
)
Net Interest Income
Q1-2024 vs Q4-2023
Net interest income increased by $88.1 million, or 58.3%, to
$239.1 million for the first quarter from $151.1 million for the
fourth quarter due to lower borrowing balances and costs, higher
asset yields that were driven by changes in the interest-earning
asset mix, and lower deposit costs.
Average interest-earning assets decreased by $809.5 million to
$34.6 billion for the first quarter due to the full quarter impact
of our fourth quarter securities sales and lower cash balances,
which were used to pay down higher-cost funding sources. The
overall decline in average interest-earning assets was offset
partially by the increase in average loans and leases during the
first quarter due mostly to the full quarter impact of legacy Banc
of California loans acquired in the fourth quarter. The net
interest margin increased by 109 basis points to 2.78% for the
first quarter compared to 1.69% for the fourth quarter due to the
average yield on interest-earning assets increasing by 45 basis
points, while the average total cost of funds decreased by 66 basis
points, which was positively impacted by an increase in average
noninterest-bearing deposits.
The average yield on interest-earning assets increased by 45
basis points to 5.68% for the first quarter from 5.23% in the
fourth quarter due mainly to the change in the interest-earning
asset mix. This was driven by the increase in the balance of
average loans and leases as a percentage of average
interest-earning assets to 74% for the first quarter from 67% for
the fourth quarter, the decrease in the balance of average
investment securities as a percentage of average interest-earning
assets to 14% for the first quarter from 17% for the fourth
quarter, and the decrease in the balance of average deposits in
financial institutions as a percentage of average interest-earning
assets to 13% for the first quarter from 16% for the fourth
quarter.
The average yield on loans and leases increased by 41 basis
points to 6.23% for the first quarter from 5.82% for the fourth
quarter as a result of higher discount accretion income and changes
in portfolio mix and a full quarter benefit from the acquired loans
and leases.
The average total cost of funds decreased by 66 basis points to
3.02% for the first quarter from 3.68% in the fourth quarter due
mainly to decreases in higher-cost borrowings and interest-bearing
deposits combined with an increase in average noninterest-bearing
deposits. The average cost of interest-bearing liabilities
decreased by 59 basis points to 3.92% for the first quarter from
4.51% in the fourth quarter. The average total cost of deposits
decreased by 28 basis points to 2.66% for the first quarter
compared to 2.94% in the fourth quarter. Average
noninterest-bearing deposits increased by $1.4 billion for the
first quarter compared to the fourth quarter and average total
deposits increased by $1.5 billion.
Provision For Credit Losses
Q1-2024 vs Q4-2023
The provision for credit losses was $10.0 million for the first
quarter. The first quarter provision was driven by an increase in
qualitative reserves related to loans secured by office properties
and an increase in quantitative reserves due to an increase in
nonaccrual and classified loans and leases. The provision for
credit losses was $47.0 million for the fourth quarter and included
an initial provision of $22.2 million for acquired legacy Banc of
California non-PCD loans. Outside this initial provision, the
fourth quarter’s expense was driven by $13.2 million of net
charge-offs and a need for increased quantitative reserves
resulting from revising the economic forecast to reflect a 60%
probability weighting on recessionary scenarios and updating
expected prepayment speeds based on a high interest rate
environment.
Noninterest Income
Q1-2024 vs Q4-2023
Noninterest income increased by $434.2 million to $33.8 million
for the first quarter due almost entirely to a decrease in the loss
on sale of securities of $442.4 million. As part of our balance
sheet repositioning strategy, we sold $2.7 billion of legacy
PacWest available-for-sale securities in the fourth quarter
resulting in losses of $442.4 million. There were no securities
sales in the first quarter of 2024.
Noninterest Expense
Q1-2024 vs Q4-2023
Noninterest expense decreased by $153.1 million to $210.5
million for the first quarter due mainly to fourth quarter
acquisition, integration and reorganization costs of $111.8 million
related to our merger with PacWest and a decrease in insurance and
assessments expense of $39.6 million, which includes $32.7 million
for the FDIC special assessment for the fourth quarter.
Income Taxes
Q1-2024 vs Q4-2023
Income tax expense of $14.3 million was recorded for the first
quarter resulting in an effective tax rate of 27.3% compared to a
benefit of $177.0 million for the fourth quarter and an effective
tax rate of 26.8%.
BALANCE SHEET HIGHLIGHTS
March 31, December 31, March 31,
Increase (Decrease) Selected
Balance Sheet Items
2024
2023
2023
CQ vs PQ CQ vs PYQ (In thousands) Cash and
cash equivalents
$
3,085,228
$
5,377,576
$
6,680,136
$
(2,292,348
)
$
(3,594,908
)
Securities available-for-sale
2,286,682
2,346,864
4,848,607
(60,182
)
(2,561,925
)
Securities held-to-maturity
2,291,984
2,287,291
2,273,650
4,693
18,334
Loan and leases held for investment, net of deferred fees
25,483,069
25,489,687
25,672,381
(6,618
)
(189,312
)
Total assets
36,080,778
38,534,064
44,302,981
(2,453,286
)
(8,222,203
)
Noninterest-bearing deposits
$
7,833,608
$
7,774,254
$
7,030,759
$
59,354
$
802,849
Total deposits
28,892,407
30,401,769
28,187,561
(1,509,362
)
704,846
Borrowings
2,139,498
2,911,322
11,881,712
(771,824
)
(9,742,214
)
Total liabilities
32,679,344
35,143,299
41,531,504
(2,463,955
)
(8,852,160
)
Total stockholders' equity
3,401,434
3,390,765
2,771,477
10,669
629,957
Securities
The balance of securities held-to-maturity (“HTM”) remained
consistent through the first quarter and totaled $2.3 billion at
March 31, 2024. As of March 31, 2024, HTM securities had aggregate
unrealized net after-tax losses in AOCI of $175.6 million remaining
from the balance established at the time of transfer on June 1,
2022.
Securities available-for-sale (“AFS”) decreased by $60.2 million
during the first quarter to $2.3 billion at March 31, 2024. AFS
securities had aggregate unrealized net after-tax losses in AOCI of
$265.3 million. These AFS unrealized net losses related primarily
to changes in overall interest rates and spreads and the resulting
impact on valuations.
Loans and Leases
The following table sets forth the composition, by loan
category, of our loan and lease portfolio held for investment, net
of deferred fees, as of the dates indicated:
March 31, December 31, September 30, June
30, March 31, Composition of
Loans and Leases
2024
2023
2023
2023
2023
(Dollars in thousands) Real estate mortgage: Commercial
$
4,902,987
$
5,026,497
$
3,526,308
$
3,610,320
$
3,808,751
Multi-family
6,124,404
6,025,179
5,279,659
5,304,544
5,523,320
Other residential
4,949,371
5,060,309
5,228,524
5,373,178
6,075,540
Total real estate mortgage
15,976,762
16,111,985
14,034,491
14,288,042
15,407,611
Real estate construction and land: Commercial
775,364
759,585
465,266
415,997
910,327
Residential
2,470,340
2,399,684
2,272,271
2,049,526
3,698,113
Total real estate construction and land
3,245,704
3,159,269
2,737,537
2,465,523
4,608,440
Total real estate
19,222,466
19,271,254
16,772,028
16,753,565
20,016,051
Commercial: Asset-based
2,061,093
2,189,085
2,287,893
2,357,098
2,068,327
Venture capital
1,513,641
1,446,362
1,464,160
1,723,476
2,058,237
Other commercial
2,246,157
2,129,860
1,002,377
1,014,212
1,102,543
Total commercial
5,820,891
5,765,307
4,754,430
5,094,786
5,229,107
Consumer
439,712
453,126
394,488
409,859
427,223
Total loans and leases held for investment, net of deferred fees
$
25,483,069
$
25,489,687
$
21,920,946
$
22,258,210
$
25,672,381
Total unfunded loan commitments
$
5,482,672
$
5,578,907
$
5,289,221
$
5,845,375
$
9,776,789
Composition as % of Total March 31,
December 31, September 30, June 30, March
31, Loans and Leases
2024
2023
2023
2023
2023
Real estate mortgage: Commercial
19
%
20
%
16
%
16
%
15
%
Multi-family
24
%
23
%
24
%
24
%
21
%
Other residential
19
%
20
%
24
%
24
%
24
%
Total real estate mortgage
62
%
63
%
64
%
64
%
60
%
Real estate construction and land: Commercial
3
%
3
%
2
%
2
%
4
%
Residential
10
%
9
%
10
%
9
%
14
%
Total real estate construction and land
13
%
12
%
12
%
11
%
18
%
Total real estate
75
%
75
%
76
%
75
%
78
%
Commercial: Asset-based
8
%
9
%
10
%
11
%
8
%
Venture capital
6
%
6
%
7
%
8
%
8
%
Other commercial
9
%
8
%
5
%
4
%
4
%
Total commercial
23
%
23
%
22
%
23
%
20
%
Consumer
2
%
2
%
2
%
2
%
2
%
Total loans and leases held for investment, net of deferred fees
100
%
100
%
100
%
100
%
100
%
Total loans and leases held for investment, net of deferred
fees, remained consistent through the first quarter and totaled
$25.5 billion at March 31, 2024. Loan fundings were $141.7 million
in the first quarter at a weighted-average interest rate of
8.31%.
Deposits and Client Investment Funds
The following table sets forth the composition of our deposits
at the dates indicated:
March 31, December 31, September 30, June
30, March 31, Composition of
Deposits
2024
2023
2023
2023
2023
(Dollars in thousands) Noninterest-bearing checking
$
7,833,608
$
7,774,254
$
5,579,033
$
6,055,358
$
7,030,759
Interest-bearing: Checking
7,836,097
7,808,764
7,038,808
7,112,807
5,360,622
Money market
5,020,110
6,187,889
5,424,347
5,678,323
8,195,670
Savings
2,016,398
1,997,989
1,441,700
897,277
671,918
Time deposits: Non-brokered
2,761,836
3,139,270
3,038,005
2,725,265
2,502,914
Brokered
3,424,358
3,493,603
4,076,788
5,428,053
4,425,678
Total time deposits
6,186,194
6,632,873
7,114,793
8,153,318
6,928,592
Total interest-bearing
21,058,799
22,627,515
21,019,648
21,841,725
21,156,802
Total deposits
$
28,892,407
$
30,401,769
$
26,598,681
$
27,897,083
$
28,187,561
March 31, December 31, September
30, June 30, March 31, Composition as % of Total Deposits
2024
2023
2023
2023
2023
Noninterest-bearing checking
27
%
26
%
21
%
22
%
25
%
Interest-bearing: Checking
27
%
26
%
27
%
26
%
19
%
Money market
17
%
20
%
20
%
20
%
29
%
Savings
7
%
6
%
5
%
3
%
2
%
Time deposits: Non-brokered
10
%
10
%
12
%
10
%
9
%
Brokered
12
%
12
%
15
%
19
%
16
%
Total time deposits
22
%
22
%
27
%
29
%
25
%
Total interest-bearing
73
%
74
%
79
%
78
%
75
%
Total deposits
100
%
100
%
100
%
100
%
100
%
Total deposits decreased by $1.5 billion during the first
quarter to $28.9 billion at March 31, 2024, due primarily to
decreases of $1.2 billion in money market accounts and $377.4
million in non-brokered time deposits.
Noninterest-bearing checking totaled $7.83 billion and
represented 27% of total deposits at March 31, 2024, compared to
$7.77 billion, or 26% of total deposits, at December 31, 2023.
Uninsured and uncollateralized deposits of $7.1 billion
represented 24% of total deposits at March 31, 2024, compared to
uninsured and uncollateralized deposits of $7.0 billion or 23% of
total deposits at December 31, 2023.
In addition to deposit products, we also offer alternative,
non-depository corporate treasury solutions for select clients to
invest excess liquidity. These alternative options include
investments managed by BofCal Asset Management Inc. (“BAM”), our
registered investment advisor subsidiary, and third-party sweep
products. Total off-balance sheet client investment funds were $0.6
billion as of December 31, 2023 and increased to $1.2 billion at
March 31, 2024, of which $0.6 billion was managed by BAM.
Borrowings
Borrowings decreased by $771.8 million from $2.9 billion at
December 31, 2023, to $2.1 billion at March 31, 2024 due primarily
to the paydown of $1.1 billion of the Bank Term Funding Program
balance, offset partially by $300 million in FHLB borrowings. We
chose to extend the $1.5 billion remaining Bank Term Funding
Program balance to March 2025 in order to have the flexibility to
pay down or pay off the balance at our discretion as business needs
dictate.
Equity
During the first quarter, total stockholders’ equity increased
by $10.7 million to $3.4 billion and tangible common equity(1)
increased by $18.9 million to $2.5 billion at March 31, 2024. The
increase in total stockholders’ equity for the first quarter
resulted primarily from net earnings in the first quarter, offset
partially by dividends declared and paid.
At March 31, 2024, book value per common share increased to
$17.18, compared to $17.12 at December 31, 2023, and tangible book
value per common share(1) increased to $15.07, compared to $14.96
at December 31, 2023.
(1)
Non-GAAP measures; refer to
section 'Non-GAAP Measures'
CAPITAL AND LIQUIDITY
Capital ratios remain strong with total risk-based capital at
16.43% and a tier 1 leverage ratio of 9.14% at March 31, 2024.
The following table sets forth our regulatory capital ratios as
of the dates indicated:
March 31, December 31, September 30, June
30, March 31, Capital
Ratios
2024 (1)
2023
2023
2023
2023
Banc of California, Inc. Total risk-based capital
ratio
16.43%
16.43%
17.83%
17.61%
14.21%
Tier 1 risk-based capital ratio
12.41%
12.44%
13.84%
13.70%
11.15%
Common equity tier 1 capital ratio
10.12%
10.14%
11.23%
11.16%
9.21%
Tier 1 leverage capital ratio
9.14%
9.00%
8.65%
7.76%
8.33%
Banc of California Total risk-based capital ratio
15.90%
15.75%
16.37%
16.07%
12.94%
Tier 1 risk-based capital ratio
13.37%
13.27%
13.72%
13.48%
10.89%
Common equity tier 1 capital ratio
13.37%
13.27%
13.72%
13.48%
10.89%
Tier 1 leverage capital ratio
9.86%
9.62%
8.57%
7.62%
8.14%
(1) Capital information for March 31, 2024 is preliminary.
At March 31, 2024, immediately available cash and cash
equivalents were $2.9 billion, a decrease of $2.3 billion from
December 31, 2023. Combined with total available borrowing capacity
of $12.6 billion and unpledged AFS securities of $1.4 billion,
total available liquidity was $16.8 billion at the end of the first
quarter.
CREDIT QUALITY
March 31, December 31, September 30, June
30, March 31, Asset Quality
Information and Ratios
2024
2023
2023
2023
2023
(Dollars in thousands) Delinquent loans and leases held
for investment: 30 to 89 days delinquent
$
178,594
$
113,307
$
49,970
$
57,428
$
144,431
90+ days delinquent
57,595
30,881
77,327
62,322
49,936
Total delinquent loans and leases
$
236,189
$
144,188
$
127,297
$
119,750
$
194,367
Total delinquent loans and leases to loans and leases held
for investment
0.93
%
0.57
%
0.58
%
0.54
%
0.76
%
Nonperforming assets, excluding loans held for sale:
Nonaccrual loans and leases
$
145,981
$
62,527
$
125,396
$
104,886
$
87,124
90+ days delinquent loans and still accruing
-
11,750
-
-
-
Total nonperforming loans and leases ("NPLs")
145,981
74,277
125,396
104,886
87,124
Foreclosed assets, net
12,488
7,394
6,829
8,426
2,135
Total nonperforming assets ("NPAs")
$
158,469
$
81,671
$
132,225
$
113,312
$
89,259
Allowance for loan and lease losses
$
291,503
$
281,687
$
222,297
$
219,234
$
210,055
Allowance for loan and lease losses to NPLs
199.69
%
379.24
%
177.28
%
209.02
%
241.10
%
NPLs to loans and leases held for investment
0.57
%
0.29
%
0.57
%
0.47
%
0.34
%
NPAs to total assets
0.44
%
0.21
%
0.36
%
0.30
%
0.20
%
At March 31, 2024, total delinquent loans and leases were $236.2
million, compared to $144.2 million at December 31, 2023. The $92.0
million increase in total delinquent loans was due mostly to a
$56.8 million increase in commercial real estate mortgage loans
that were 30 to 89 days delinquent and a $35.1 million increase in
other residential real estate mortgage loans that were 90 or more
days delinquent. Total delinquent loans and leases as a percentage
of total loans and leases increased to 0.93% at March 31, 2024, as
compared to 0.57% at December 31, 2023.
At March 31, 2024, nonperforming assets were $158.5 million, or
0.44% of total assets, compared to $81.7 million, or 0.21% of total
assets, as of December 31, 2023.
At March 31, 2024, nonperforming loans were $146.0 million, and
included $66.7 million of CRE loans, $61.8 million of other
residential loans (mostly Civic), $15.7 million of commercial and
industrial loans, $1.0 million of multi-family loans, and $0.8
million of consumer loans. During the first quarter, nonperforming
loans increased by $71.7 million due to additions of $90.9 million,
offset partially by borrowers that became current of $12.8 million,
payoffs and paydowns of $5.0 million, and net charge-offs of $1.4
million.
Nonperforming loans and leases as a percentage of total loans
and leases increased to 0.57% at March 31, 2024 compared to 0.29%
at December 31, 2023. Four CRE credits drove the majority of the
increase to nonperforming loans during the period, which included 3
office properties and 1 retail property. Specific reserves were
established for two office properties which contributed to the
increase in the provision. The legacy Civic portfolio also
contributed to the increase in both delinquencies and nonperforming
loans. The nonperforming loan increase was driven mainly by the
four CRE properties which represented 60% of the increase, Civic
represented 29% of the increase, and SFR/consumer loans represented
7% of the increase.
At March 31, 2024, nonperforming assets included $12.5 million
of other real estate owned, consisting entirely of single-family
residences.
ALLOWANCE FOR CREDIT LOSSES - LOANS
Three Months Ended March 31, December 31,
March 31, Allowance for Credit
Losses - Loans
2024
2023
2023
(Dollars in thousands) Allowance for loan and lease
losses ("ALLL"): Balance at beginning of period
$
281,687
$
222,297
$
200,732
Initial ALLL on acquired PCD loans
-
25,623
-
Charge-offs
(5,014
)
(14,628
)
(10,397
)
Recoveries
3,830
1,395
1,220
Net charge-offs
(1,184
)
(13,233
)
(9,177
)
Provision for loan losses
11,000
47,000
(1)
18,500
Balance at end of period
$
291,503
$
281,687
$
210,055
Reserve for unfunded loan commitments ("RUC"):
Balance at beginning of period
$
29,571
$
29,571
$
91,071
(Negative provision) provision for credit losses
(1,000
)
-
(15,500
)
Balance at end of period
$
28,571
$
29,571
$
75,571
Allowance for credit losses ("ACL") - Loans: Balance
at beginning of period
$
311,258
$
251,868
$
291,803
Initial ALLL on acquired PCD loans
-
25,623
-
Charge-offs
(5,014
)
(14,628
)
(10,397
)
Recoveries
3,830
1,395
1,220
Net charge-offs
(1,184
)
(13,233
)
(9,177
)
Provision for credit losses
10,000
47,000
3,000
Balance at end of period
$
320,074
$
311,258
$
285,626
ALLL to loans and leases held for investment
1.14
%
1.11
%
0.82
%
ACL to loans and leases held for investment
1.26
%
1.22
%
1.11
%
ACL to NPLs
219.26
%
419.05
%
327.84
%
ACL to NPAs
201.98
%
381.11
%
320.00
%
Annualized net charge-offs to average loans and leases
0.02
%
0.22
%
0.13
%
(1) Includes $22.2 million initial provision related to non-PCD
loans acquired during the period.
The allowance for credit losses, which includes the reserve for
unfunded loan commitments, totaled $320.1 million, or 1.26% of
total loans and leases, at March 31, 2024, compared to $311.3
million, or 1.22% of total loans and leases, at December 31, 2023.
The $8.8 million increase in the allowance was due to a $10.0
million provision, offset partially by net charge-offs of $1.2
million. The ACL coverage of nonperforming loans was 219% at March
31, 2024 compared to 419% at December 31, 2023.
Net charge-offs were 0.02% of average loans and leases
(annualized) for the first quarter, compared to 0.22% for the
fourth quarter. The decrease in net charge-offs in the first
quarter was due primarily to $5.3 million of charge-offs related to
the transfer of Civic loans to held for sale in the fourth
quarter.
Conference Call
The Company will host a conference call to discuss its first
quarter 2024 financial results at 10:00 a.m. Pacific Time (PT) on
Tuesday, April 23, 2024. Interested parties are welcome to attend
the conference call by dialing (888) 317-6003 and referencing event
code 1537279. A live audio webcast will also be available and the
webcast link will be posted on the Company’s Investor Relations
website at www.bancofcal.com/investor. The slide presentation for
the call will also be available on the Company's Investor Relations
website prior to the call. A replay of the call will be made
available approximately one hour after the call has ended on the
Company’s Investor Relations website at www.bancofcal.com/investor
or by dialing (877) 344-7529 and referencing event code
4374649.
About Banc of California, Inc.
Banc of California, Inc. (NYSE: BANC) is a bank holding company
with over $36 billion in assets and the parent company of Banc of
California. Banc of California is one of the nation’s premier
relationship-based business banks, providing banking and treasury
management services to small-, middle-market, and venture-backed
businesses. Banc of California is the third largest bank
headquartered in California and offers a broad range of loan and
deposit products and services through more than 90 full-service
branches throughout California and in Denver, Colorado, and Durham,
North Carolina, as well as through regional offices nationwide. The
bank also provides full-stack payment processing solutions through
its subsidiary, Deepstack Technologies, and serves the Community
Association Management industry nationwide with its
technology-forward platform, SmartStreet™. The bank is committed to
its local communities by supporting organizations that provide
financial literacy and job training, small business support,
affordable housing, and more. For more information, please visit us
at www.bancofcal.com.
Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of the “Safe-Harbor” provisions of the Private
Securities Litigation Reform Act of 1995. Words or phrases such as
“believe,” “will,” “should,” “will likely result,” “are expected
to,” “will continue,” “is anticipated,” “estimate,” “project,”
“plans,” “strategy,” or similar expressions are intended to
identify these forward-looking statements. You are cautioned not to
place undue reliance on any forward-looking statements. These
statements are necessarily subject to risk and uncertainty and
actual results could differ materially from those anticipated due
to various factors, including those set forth from time to time in
the documents filed or furnished by Banc of California, Inc. (the
“Company”) with the Securities and Exchange Commission (“SEC”). The
Company undertakes no obligation to revise or publicly release any
revision or update to these forward-looking statements to reflect
events or circumstances that occur after the date on which such
statements were made, except as required by law.
Factors that could cause actual results to differ materially
from the results anticipated or projected include, but are not
limited to: (i) changes in general economic conditions, either
nationally or in our market areas, including the impact of supply
chain disruptions, and the risk of recession or an economic
downturn; (ii) changes in the interest rate environment, including
the recent and potential future changes in the FRB benchmark rate,
which could adversely affect our revenue and expenses, the value of
assets and obligations, the realization of deferred tax assets, the
availability and cost of capital and liquidity, and the impacts of
continuing inflation; (iii) the credit risks of lending activities,
which may be affected by deterioration in real estate markets and
the financial condition of borrowers, and the operational risk of
lending activities, including the effectiveness of our underwriting
practices and the risk of fraud, any of which may lead to increased
loan delinquencies, losses, and non-performing assets, and may
result in our allowance for credit losses not being adequate; (iv)
fluctuations in the demand for loans, and fluctuations in
commercial and residential real estate values in our market area;
(v) the quality and composition of our securities portfolio; (vi)
our ability to develop and maintain a strong core deposit base,
including among our venture banking clients, or other low cost
funding sources necessary to fund our activities particularly in a
rising or high interest rate environment; (vii) the rapid
withdrawal of a significant amount of demand deposits over a short
period of time; (viii) the costs and effects of litigation; (ix)
risks related to the Company’s acquisitions, including disruption
to current plans and operations; difficulties in customer and
employee retention; fees, expenses and charges related to these
transactions being significantly higher than anticipated; and our
inability to achieve expected revenues, cost savings, synergies,
and other benefits; and in the case of our recent acquisition of
PacWest Bancorp (“PacWest”), reputational risk, regulatory risk and
potential adverse reactions of the Company's or PacWest's
customers, suppliers, vendors, employees or other business
partners; (x) results of examinations by regulatory authorities of
the Company and the possibility that any such regulatory authority
may, among other things, limit our business activities, restrict
our ability to invest in certain assets, refrain from issuing an
approval or non-objection to certain capital or other actions,
increase our allowance for credit losses, result in write-downs of
asset values, restrict our ability or that of our bank subsidiary
to pay dividends, or impose fines, penalties or sanctions; (xi)
legislative or regulatory changes that adversely affect our
business, including changes in tax laws and policies, accounting
policies and practices, privacy laws, and regulatory capital or
other rules; (xii) the risk that our enterprise risk management
framework may not be effective in mitigating risk and reducing the
potential for losses; (xiii) errors in estimates of the fair values
of certain of our assets and liabilities, which may result in
significant changes in valuation; (xiv) failures or security
breaches with respect to the network, applications, vendors and
computer systems on which we depend, including due to cybersecurity
threats; (xv) our ability to attract and retain key members of our
senior management team; (xvi) the effects of climate change, severe
weather events, natural disasters, pandemics, epidemics and other
public health crises, acts of war or terrorism, and other external
events on our business; (xvii) the impact of bank failures or other
adverse developments at other banks on general depositor and
investor sentiment regarding the stability and liquidity of banks;
(xviii) the possibility that our recorded goodwill could become
impaired, which may have an adverse impact on our earnings and
capital; (xix) our existing indebtedness, together with any future
incurrence of additional indebtedness, could adversely affect our
ability to raise additional capital and to meet our debt
obligations; (xx) the risk that we may incur significant losses on
future asset sales; and (xxi) other economic, competitive,
governmental, regulatory, and technological factors affecting our
operations, pricing, products and services and the other risks
described in this press release and from time to time in other
documents that we file with or furnish to the SEC.
BANC OF CALIFORNIA, INC. CONSOLIDATED STATEMENTS OF
FINANCIAL CONDITION (UNAUDITED) March 31,
December 31, September 30, June 30, March
31,
2024
2023
2023
2023
2023
(Dollars in thousands) ASSETS: Cash and due from
banks
$
199,922
$
202,427
$
182,261
$
208,300
$
218,830
Interest-earning deposits in financial institutions
2,885,306
5,175,149
5,887,406
6,489,847
6,461,306
Total cash and cash equivalents
3,085,228
5,377,576
6,069,667
6,698,147
6,680,136
Securities available-for-sale
2,286,682
2,346,864
4,487,172
4,708,519
4,848,607
Securities held-to-maturity
2,291,984
2,287,291
2,282,586
2,278,202
2,273,650
FRB and FHLB stock
129,314
126,346
17,250
17,250
147,150
Total investment securities
4,707,980
4,760,501
6,787,008
7,003,971
7,269,407
Loans held for sale
80,752
122,757
188,866
478,146
2,796,208
Gross loans and leases held for investment
25,527,075
25,534,730
21,969,789
22,311,292
25,770,912
Deferred fees, net
(44,006
)
(45,043
)
(48,843
)
(53,082
)
(98,531
)
Total loans and leases held for investment, net of deferred fees
25,483,069
25,489,687
21,920,946
22,258,210
25,672,381
Allowance for loan and lease losses
(291,503
)
(281,687
)
(222,297
)
(219,234
)
(210,055
)
Total loans and leases held for investment, net
25,191,566
25,208,000
21,698,649
22,038,976
25,462,326
Equipment leased to others under operating leases
339,925
344,325
352,330
380,022
399,972
Premises and equipment, net
144,912
146,798
50,236
57,078
60,358
Bank owned life insurance
341,806
339,643
207,946
206,812
207,402
Goodwill
198,627
198,627
-
-
-
Intangible assets, net
157,226
165,477
24,192
26,581
28,970
Deferred tax asset, net
738,373
739,111
506,248
426,304
342,557
Other assets
1,094,383
1,131,249
992,691
1,021,213
1,055,645
Total assets
$
36,080,778
$
38,534,064
$
36,877,833
$
38,337,250
$
44,302,981
LIABILITIES: Noninterest-bearing deposits
$
7,833,608
$
7,774,254
$
5,579,033
$
6,055,358
$
7,030,759
Interest-bearing deposits
21,058,799
22,627,515
21,019,648
21,841,725
21,156,802
Total deposits
28,892,407
30,401,769
26,598,681
27,897,083
28,187,561
Borrowings
2,139,498
2,911,322
6,294,525
6,357,338
11,881,712
Subordinated debt
937,717
936,599
870,896
870,378
868,815
Accrued interest payable and other liabilities
709,722
893,609
714,454
679,256
593,416
Total liabilities
32,679,344
35,143,299
34,478,556
35,804,055
41,531,504
STOCKHOLDERS' EQUITY: Preferred stock
498,516
498,516
498,516
498,516
498,516
Common stock
1,583
1,577
1,231
1,233
1,232
Class B non-voting common stock
5
5
-
-
-
Non-voting common stock equivalents
101
108
-
-
-
Additional paid-in-capital
3,827,777
3,840,974
2,798,611
2,799,357
2,792,536
Retained (deficit) earnings
(490,112
)
(518,301
)
(25,399
)
7,892
215,253
Accumulated other comprehensive loss, net
(436,436
)
(432,114
)
(873,682
)
(773,803
)
(736,060
)
Total stockholders’ equity
3,401,434
3,390,765
2,399,277
2,533,195
2,771,477
Total liabilities and stockholders’ equity
$
36,080,778
$
38,534,064
$
36,877,833
$
38,337,250
$
44,302,981
Common shares outstanding (1)
169,013,629
168,959,063
78,806,969
78,939,024
78,988,424
(1) Common shares outstanding
include non-voting common equivalents that are participating
securities.
BANC OF CALIFORNIA, INC. CONSOLIDATED STATEMENTS OF
EARNINGS (LOSS) (UNAUDITED) Three Months Ended
March 31, December 31, March 31,
2024
2023
2023
(In thousands, except per share amounts) Interest
income: Loans and leases
$
395,511
$
346,308
$
430,685
Investment securities
34,303
41,280
44,237
Deposits in financial institutions
58,936
79,652
42,866
Total interest income
488,750
467,240
517,788
Interest expense: Deposits
194,807
207,760
155,892
Borrowings
38,124
92,474
69,122
Subordinated debt
16,671
15,955
13,502
Total interest expense
249,602
316,189
238,516
Net interest income
239,148
151,051
279,272
Provision for credit losses
10,000
47,000
3,000
Net interest income after provision for credit losses
229,148
104,051
276,272
Noninterest income: Service charges on deposit
accounts
4,705
4,562
3,573
Other commissions and fees
8,142
8,860
10,344
Leased equipment income
11,716
12,369
13,857
(Loss) gain on sale of loans and leases
(448
)
(3,526
)
2,962
Loss on sale of securities
-
(442,413
)
-
Dividends and gains (losses) on equity investments
3,068
8,138
1,098
Warrant income (loss)
178
(173
)
(333
)
LOCOM HFS adjustment
330
3,175
-
Other income
6,125
8,606
4,890
Total noninterest income (loss)
33,816
(400,402
)
36,391
Noninterest expense: Compensation
92,236
89,354
88,476
Occupancy
17,968
15,925
15,067
Information technology and data processing
15,418
13,099
12,979
Other professional services
5,075
2,980
6,073
Insurance and assessments
20,461
60,016
11,717
Intangible asset amortization
8,404
4,230
2,411
Leased equipment depreciation
7,520
7,447
9,375
Acquisition, integration and reorganization costs
-
111,800
8,514
Customer related expense
30,919
45,826
24,005
Loan expense
4,491
4,446
6,524
Goodwill impairment
-
-
1,376,736
Other expense
8,026
8,515
11,126
Total noninterest expense
210,518
363,638
1,573,003
Earnings (loss) before income taxes
52,446
(659,989
)
(1,260,340
)
Income tax expense (benefit)
14,310
(177,034
)
(64,916
)
Net earnings (loss)
38,136
(482,955
)
(1,195,424
)
Preferred stock dividends
9,947
9,947
9,947
Net earnings (loss) available to common and equivalent
stockholders
$
28,189
$
(492,902
)
$
(1,205,371
)
Basic and diluted earnings (loss) per common share (1)
$
0.17
$
(4.55
)
$
(15.56
)
Basic and diluted weighted average number of common shares
outstanding (1)
168,972
108,290
77,468
(1) Common shares include non-voting common equivalents that
are participating securities.
BANC OF CALIFORNIA, INC.
SELECTED FINANCIAL DATA (UNAUDITED) Three
Months Ended March 31, December 31, March
31, Profitability and Other
Ratios
2024
2023
2023
Return on average assets ("ROAA")(1)
0.41%
(5.09)%
(11.34)%
Adjusted ROAA (1)(2)
0.45%
(0.56)%
0.85%
Return on average equity (1)
4.52%
(68.49)%
(121.24)%
Return on average tangible common equity (1)(2)
5.45%
(87.95)%
14.45%
Dividend payout ratio (3)
58.82%
(2.42)%
(1.61)%
Average yield on loans and leases (1)
6.23%
5.82%
6.14%
Average yield on interest-earning assets (1)
5.68%
5.23%
5.35%
Average cost of interest-bearing deposits (1)
3.60%
3.80%
2.91%
Average total cost of deposits (1)
2.66%
2.94%
1.98%
Average cost of interest-bearing liabilities (1)
3.92%
4.51%
3.47%
Average total cost of funds (1)
3.02%
3.68%
2.54%
Net interest spread
1.76%
0.72%
1.88%
Net interest margin (1)
2.78%
1.69%
2.89%
Noninterest income to total revenue (4)
12.39%
160.58%
11.53%
Adjusted noninterest income to adjusted total revenue (2)(4)
12.39%
21.76%
11.53%
Noninterest expense to average total assets (1)
2.26%
3.83%
14.92%
Adjusted noninterest expense to average total assets (1)(2)
2.20%
2.31%
1.78%
Average loans and leases to average deposits
86.65%
84.34%
89.39%
Average investment securities to average total assets
12.58%
16.01%
16.81%
Average stockholders' equity to average total assets
9.03%
7.43%
9.35%
(1) Annualized.
(2) Non-GAAP measure.
(3) Ratio calculated by dividing
dividends declared per common and equivalent share by basic
earnings per common and equivalent share.
(4)Total revenue equals the sum
of net interest income and noninterest income.
BANC OF CALIFORNIA, INC. AVERAGE BALANCE, AVERAGE YIELD
EARNED, AND AVERAGE COST PAID (UNAUDITED)
Three Months Ended March 31, 2024 December 31,
2023 March 31, 2023 Interest Average
Interest Average Interest Average
Average Income/ Yield/ Average
Income/ Yield/ Average Income/
Yield/ Balance Expense Cost
Balance Expense Cost Balance
Expense Cost (Dollars in thousands)
Assets: Loans and leases
(1)(2)(3)
$
25,518,700
$
395,511
6.23%
$
23,608,246
$
346,308
5.82%
$
28,583,265
$
433,029
6.14%
Investment securities
4,721,556
34,303
2.92%
6,024,737
41,280
2.72%
7,191,362
44,237
2.49%
Deposits in financial institutions
4,374,968
58,936
5.42%
5,791,739
79,652
5.46%
3,682,228
42,866
4.72%
Total interest-earning assets (1)
34,615,224
488,750
5.68%
35,424,722
467,240
5.23%
39,456,855
520,132
5.35%
Other assets
2,925,563
2,215,665
3,311,859
Total assets
$
37,540,787
$
37,640,387
$
42,768,714
Liabilities and Stockholders'
Equity:
Interest checking
$
7,883,177
61,549
3.14%
$
7,296,234
60,743
3.30%
$
7,089,102
55,957
3.20%
Money market
5,737,837
41,351
2.90%
5,758,074
44,279
3.05%
8,932,059
56,224
2.55%
Savings
2,036,129
18,030
3.56%
1,696,222
16,446
3.85%
597,287
599
0.41%
Time
6,108,321
73,877
4.86%
6,915,504
86,292
4.95%
5,123,955
43,112
3.41%
Total interest-bearing deposits
21,765,464
194,807
3.60%
21,666,034
207,760
3.80%
21,742,403
155,892
2.91%
Borrowings
2,892,406
38,124
5.30%
5,229,425
92,474
7.02%
5,289,429
69,122
5.30%
Subordinated debt
937,005
16,671
7.16%
894,219
15,955
7.08%
867,637
13,502
6.31%
Total interest-bearing liabilities
25,594,875
249,602
3.92%
27,789,678
316,189
4.51%
27,899,469
238,516
3.47%
Noninterest-bearing demand deposits
7,685,027
6,326,511
10,233,434
Other liabilities
870,273
726,414
637,124
Total liabilities
34,150,175
34,842,603
38,770,027
Stockholders' equity
3,390,612
2,797,784
3,998,687
Total liabilities and stockholders' equity
$
37,540,787
$
37,640,387
$
42,768,714
Net interest income (1)
$
239,148
$
151,051
$
281,616
Net interest spread (1)
1.76%
0.72%
1.88%
Net interest margin (1)
2.78%
1.69%
2.89%
Total deposits (4)
$
29,450,491
$
194,807
2.66%
$
27,992,545
$
207,760
2.94%
$
31,975,837
$
155,892
1.98%
Total funds (5)
$
33,279,902
$
249,602
3.02%
$
34,116,189
$
316,189
3.68%
$
38,132,903
$
238,516
2.54%
(1)
Tax equivalent.
(2)
Includes net loan discount
accretion of $32.5 million and $15.7 million for the three months
ended March 31, 2024, December 31, 2023 and net loan premium
amortization of $2.8 million for the three months ended March 31,
2023.
(3)
Includes tax-equivalent
adjustments of $0.0 million, $0.0 million, and $2.3 million for the
three months ended March 31, 2024, December 31, 2023, and March 31,
2023 related to tax-exempt income on loans.
The federal statutory tax rate
utilized was 21%.
(4)
Total deposits is the sum of
total interest-bearing deposits and noninterest-bearing demand
deposits. The cost of total deposits is calculated as annualized
interest expense on total deposits divided by average total
deposits.
(5)
Total funds is the sum of total
interest-bearing liabilities and noninterest-bearing demand
deposits. The cost of total funds is calculated as annualized total
interest expense divided by average total funds.
BANC OF CALIFORNIA, INC.
NON-GAAP MEASURES
Under Item 10(e) of SEC Regulation S-K, public companies
disclosing financial measures in filings with the SEC that are not
calculated in accordance with GAAP must also disclose, along with
each non-GAAP financial measure, certain additional information,
including a presentation of the most directly comparable GAAP
financial measure, a reconciliation of the non-GAAP financial
measure to the most directly comparable GAAP financial measure, as
well as a statement of the reasons why the company's management
believes that presentation of the non-GAAP financial measure
provides useful information to investors regarding the company's
financial condition and results of operations and, to the extent
material, a statement of the additional purposes, if any, for which
the company's management uses the non-GAAP financial measure.
Tangible assets, tangible equity, tangible common equity,
tangible common equity to tangible assets, tangible book value per
common share, return on average tangible common equity, adjusted
return on average tangible common equity, adjusted noninterest
income, adjusted noninterest expense, adjusted noninterest income
to adjusted total revenue, adjusted noninterest expense to average
total assets, adjusted net earnings (loss) available to common
stockholders, adjusted diluted earnings (loss) per diluted common
share, and adjusted return on average assets (“ROAA”) constitute
supplemental financial information determined by methods other than
in accordance with GAAP. These non-GAAP measures are used by
management in its analysis of the Company's performance.
Tangible assets and tangible equity are calculated by
subtracting goodwill and other intangible assets from total assets
and total stockholders’ equity. Tangible common equity is
calculated by subtracting preferred stock, as applicable, from
tangible equity. Return on average tangible common equity is
calculated by dividing net earnings available to common
stockholders, after adjustment for amortization of intangible
assets and goodwill impairment, by average tangible common equity.
Adjusted return on average tangible common equity is calculated by
dividing adjusted net earnings available to common stockholders,
after adjustment for amortization of intangible assets, goodwill
impairment, and any unusual one-time items, by average tangible
common equity. Banking regulators also exclude goodwill and other
intangible assets from stockholders' equity when assessing the
capital adequacy of a financial institution.
Adjusted net earnings (loss) is calculated by adjusting net
earnings (loss) by unusual, one-time items. ROAA is calculated by
dividing annualized net earnings (loss) by average assets. Adjusted
ROAA is calculated by dividing annualized adjusted net earnings
(loss) by average assets.
Management believes the presentation of these financial measures
adjusting the impact of these items provides useful supplemental
information that is essential to a proper understanding of the
financial results and operating performance of the Company. This
disclosure should not be viewed as a substitute for results
determined in accordance with GAAP, nor is it necessarily
comparable to non-GAAP performance measures that may be presented
by other companies.
The following tables provide reconciliations of the non-GAAP
measures with financial measures defined by GAAP.
BANC OF CALIFORNIA, INC. NON-GAAP MEASURES
(UNAUDITED) Tangible Common Equity to
Tangible Assets and Tangible March 31, December
31, September 30, June 30, March 31,
Book Value Per Common Share
2024
2023
2023
2023
2023
(Dollars in thousands, except per share amounts)
Stockholders' equity
$
3,401,434
$
3,390,765
$
2,399,277
$
2,533,195
$
2,771,477
Less: Preferred stock
498,516
498,516
498,516
498,516
498,516
Total common equity
2,902,918
2,892,249
1,900,761
2,034,679
2,272,961
Less: Goodwill and Intangible assets
355,853
364,104
24,192
26,581
28,970
Tangible common equity
$
2,547,065
$
2,528,145
$
1,876,569
$
2,008,098
$
2,243,991
Total assets
$
36,080,778
$
38,534,064
$
36,877,833
$
38,337,250
$
44,302,981
Less: Goodwill and Intangible assets
355,853
364,104
24,192
26,581
28,970
Tangible assets
$
35,724,925
$
38,169,960
$
36,853,641
$
38,310,669
$
44,274,011
Total stockholders' equity to total assets
9.43
%
8.80
%
6.51
%
6.61
%
6.26
%
Tangible common equity to tangible assets
7.13
%
6.62
%
5.09
%
5.24
%
5.07
%
Book value per common share (1)
$
17.18
$
17.12
$
24.12
$
25.78
$
28.78
Tangible book value per common share (2)
$
15.07
$
14.96
$
23.81
$
25.44
$
28.41
Common shares outstanding (3)
169,013,629
168,959,063
78,806,969
78,939,024
78,988,424
(1) Total common equity divided
by common shares outstanding.
(2) Tangible common equity
divided by common shares outstanding.
(3) Common shares outstanding
include non-voting common equivalents that are participating
securities.
BANC OF CALIFORNIA, INC. NON-GAAP MEASURES
(UNAUDITED) Return on Average Tangible
Three Months Ended Common Equity ("ROATCE") March
31, December 31, March 31, and Adjusted ROATCE
2024
2023
2023
(Dollars in thousands) Net earnings (loss)
$
38,136
$
(482,955
)
$
(1,195,424
)
Earnings (loss) before income taxes
$
52,446
$
(659,989
)
$
(1,260,340
)
Add: Intangible asset amortization
8,404
4,230
2,411
Add: Goodwill impairment
-
-
1,376,736
Adjusted earnings (loss) before income taxes used for ROATCE
60,850
(655,759
)
118,807
Adjusted income tax expense (1)
16,612
(175,743
)
33,741
Adjusted net earnings (loss) for ROATCE
44,238
(480,016
)
85,066
Less: Preferred stock dividends
9,947
9,947
9,947
Adjusted net earnings (loss) available to common and equivalent
stockholders for ROATCE
$
34,291
$
(489,963
)
$
75,119
Adjusted earnings (loss) before income taxes used for ROATCE
$
60,850
$
(655,759
)
$
118,807
Add: FDIC special assessment
4,814
32,746
-
Add: Loss on sale of securities
-
442,413
-
Add: Acquisition, integration, and reorganization costs
-
111,800
8,514
Adjusted earnings (loss) before income taxes used for adjusted
ROATCE
65,664
(68,800
)
127,321
Adjusted income tax expense (1)
17,926
(18,438
)
36,159
Adjusted net earnings (loss) for adjusted ROATCE
47,738
(50,362
)
91,162
Less: Preferred stock dividends
9,947
9,947
9,947
Adjusted net earnings (loss) available to common and
equivalent stockholders for adjusted ROATCE
$
37,791
$
(60,309
)
$
81,215
Average stockholders' equity
$
3,390,612
$
2,797,784
$
3,998,687
Less: Average intangible assets
360,680
89,041
1,391,857
Less: Average preferred stock
498,516
498,516
498,516
Average tangible common equity
$
2,531,416
$
2,210,227
$
2,108,314
Return on average equity (2)
4.52
%
(68.49
)%
(121.24
)%
ROATCE (3)
5.45
%
(87.95
)%
14.45
%
Adjusted ROATCE (4)
6.00
%
(10.83
)%
15.62
%
(1) Effective tax rates of 27.3% and 26.8% used for the
three months ended March 31, 2024 and December 31, 2023. Adjusted
effective tax rate of 28.4% used to normalize the effect of
goodwill impairment for the three months ended March 31, 2023. (2)
Annualized net earnings (loss) divided by average stockholders'
equity. (3) Annualized adjusted net earnings (loss) available to
common and equivalent stockholders for ROATCE divided by average
tangible common equity. (4) Annualized adjusted net earnings (loss)
available to common and equivalent stockholders for adjusted ROATCE
divided by average tangible common equity.
BANC OF CALIFORNIA,
INC. NON-GAAP MEASURES (UNAUDITED)
Adjusted Net Earnings, Net Earnings Three Months
Ended Available to Common and Equivalent March
31, December 31, March 31, Stockholders, Diluted EPS, and ROAA
2024
2023
2023
(In thousands, except per share amounts) Net earnings (loss)
$
38,136
$
(482,955
)
$
(1,195,424
)
Earnings (loss) before income taxes
$
52,446
$
(659,989
)
$
(1,260,340
)
Add: FDIC special assessment
4,814
32,746
-
Add: Loss on sale of securities
-
442,413
-
Add: Acquisition, integration, and reorganization costs
-
111,800
8,514
Add: Goodwill impairment
-
-
1,376,736
Adjusted (loss) earnings before income taxes
57,260
(73,030
)
124,910
Adjusted income tax expense (1)
15,632
(19,572
)
35,474
Adjusted net earnings (loss)
41,628
(53,458
)
89,436
Less: Preferred stock dividends
(9,947
)
(9,947
)
(9,947
)
Adjusted net earnings (loss) available to common and equivalent
stockholders
$
31,681
$
(63,405
)
$
79,489
Weighted average common shares outstanding
168,972
108,290
77,468
Diluted earnings (loss) per common share
$
0.17
$
(4.55
)
$
(15.56
)
Adjusted diluted earnings (loss) per common share (2)
$
0.19
$
(0.59
)
$
1.03
Average total assets
$
37,540,787
$
37,640,387
$
42,768,714
Return on average assets ("ROAA") (3)
0.41
%
(5.09
)%
(11.34
)%
Adjusted ROAA (4)
0.45
%
(0.56
)%
0.85
%
(1) Effective tax rates of 27.3%
and 26.8% used for the three months ended March 31, 2024 and
December 31, 2023. Adjusted effective tax rate of 28.4% used to
normalize the effect of goodwill impairment for the three months
ended March 31, 2023.
(2) Adjusted net earnings (loss)
available to common and equivalent stockholders divided by weighted
average common shares outstanding.
(3) Annualized net earnings
(loss) divided by average assets.
(4) Annualized adjusted net
earnings (loss) divided by average assets.
BANC OF CALIFORNIA, INC. NON-GAAP MEASURES
(UNAUDITED) Adjusted Noninterest Income to
Three Months Ended Adjusted Total Revenue and
Adjusted March 31, December 31, March 31,
Noninterest Expense to Average
Assets
2024
2023
2023
(Dollars in thousands) Net interest income
$
239,148
$
151,051
$
279,272
Noninterest income (loss)
33,816
(400,402
)
36,391
Total revenue
$
272,964
$
(249,351
)
$
315,663
Noninterest income (loss)
$
33,816
$
(400,402
)
$
36,391
Add: Loss on sale of securities
-
442,413
-
Adjusted noninterest income
33,816
42,011
36,391
Net interest income
239,148
151,051
279,272
Adjusted total revenue
$
272,964
$
193,062
$
315,663
Noninterest expense
$
210,518
$
363,638
$
1,573,003
Less: FDIC special assessment
(4,814
)
(32,746
)
-
Less: Acquisition, integration, and reorganization costs
-
(111,800
)
(8,514
)
Less: Goodwill impairment
-
-
(1,376,736
)
Adjusted noninterest expense
$
205,704
$
219,092
$
187,753
Average total assets
$
37,540,787
$
37,640,387
$
42,768,714
Noninterest income (loss) to total revenue
12.39
%
160.58
%
11.53
%
Adjusted noninterest income to adjusted total revenue
12.39
%
21.76
%
11.53
%
Noninterest expense to average total assets
2.26
%
3.83
%
14.92
%
Adjusted noninterest expense to average total assets
2.20
%
2.31
%
1.78
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240423672972/en/
Investor Relations Inquiries: Banc of California, Inc.
(855) 361-2262 Jared Wolff, (310) 424-1230 Joe Kauder, (310)
844-5224 William Black, (919) 597-7466
Media Contact: Debora Vrana, Banc of California (213)
999-4141 Deb.Vrana@bancofcal.com
Grafico Azioni Banc of California (NYSE:BANC)
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Grafico Azioni Banc of California (NYSE:BANC)
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