Banc of California, Inc. (NYSE: BANC) today reported net loss available to common stockholders for the first quarter of 2020 of $9.7 million, or diluted loss per common share of $0.19.
First quarter results included:
- Common Equity Tier 1 capital at 11.57%
- Noninterest-bearing deposit balances increased $167.6 million to 23% of total deposits, up from 20%
- Total DDA balances increased $206.1 million to 51% of total deposits
- End of period deposit costs dropped to 0.89%; average total deposit costs decreased 16 basis points to 1.11%
- Allowance for credit losses increased to 1.45% of total loans, up from 1.04%
- Day 2 CECL provision for credit losses of $15.8 million
Jared Wolff, President & CEO of Banc of California, commented, “Our first quarter results demonstrate our continued progress transforming Banc of California into a relationship focused business bank. Our work over the past 15 months to de-risk our balance sheet created significant excess capital to help absorb first quarter COVID-19 and CECL-related provisions while remaining very well-capitalized. As a result of our ongoing balance sheet transformation, we have also substantially increased our noninterest-bearing and low-cost deposits as a percent of total deposits. For 2020, while remaining vigilant about credit, we will continue to look to improve the deposit franchise, remix our loan portfolio towards relationship lending, and opportunistically deploy capital for the benefit of shareholders, building franchise value for the long term.”
Mr. Wolff continued, "During this time of uncertainty caused by the COVID-19 pandemic, we are focused on keeping our employees safe and healthy, so we can support our clients and our communities. We are actively assisting our clients who are experiencing disruption and hardship during these times. We are particularly proud of our colleagues who have been tireless in those efforts on the front lines and behind the scenes. At this time, we are demonstrating what true relationship banking is all about, solidifying relationships with existing clients and building new relationships as well."
Lynn Hopkins, Chief Financial Officer of Banc of California said, "We finished the first quarter in a strong financial position, with healthy capital levels, increased on-balance sheet liquidity, and continued growth in noninterest bearing and demand deposits. Net income was negatively impacted by a $15.8 million provision for credit losses under CECL and in response to the pandemic. Excluding the impact of the provision for credit losses and certain non-core expenses, pre-tax income was $10.6 million, and benefited from a $5 million reduction in core expenses that was set in motion before the crisis, and put us in a better position to operate with the lower revenues from the economic disruption and significant cuts in market interest rates. Our net interest margin held up relatively well at 2.97% against these rate cuts, as our dedicated and proactive deposit efforts lowered deposit costs another 16 basis points to an average of 1.11% for the first quarter, and ended the period with a spot rate of 89 basis points. This quarter marked the fifth consecutive quarter of growth in average noninterest-bearing deposits. While the economic outlook remains uncertain, our healthy reserves and strong capital position will serve the Company well with the potential challenges ahead, as we continue to focus on closely managing credit, actively improving the mix and cost of deposits, reducing expenses, and continuing to strengthen our balance sheet."
COVID-19 Operational Update
With the onset of the COVID-19 pandemic, we successfully implemented our business continuity plan to enable our team to work remotely while continuing to serve our clients with as little disruption as possible. Early in March, we took meaningful steps to transition our team members to a "work from home" environment and we have over 80% of our team working remotely. We continue to operate 25 of our 31 branches as we temporarily consolidated some overlapping areas to ensure an adequate balance between employee and client safety and business continuity to meet our clients' banking needs. For the Paycheck Protection Program (PPP) created by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), we redeployed resources to this program in support of our clients and others seeking financial relief under the program. As of April 28, 2020, we estimate we helped our clients save over 8,500 jobs through pending applications or approvals for more than $270 million in PPP funds. We expect to earn fees of just under 3% on the total amount that ultimately funds. We are actively engaged with our borrowers who are seeking payment relief and waiving certain fees for impacted clients.
Adoption of the Current Expected Credit Loss (CECL) Model
On January 1, 2020, we adopted the new accounting standard, commonly known as CECL, which uses a current expected credit loss model for determining allowance for credit losses (ACL). Upon adoption, we recognized a Day 1 increase in the ACL of $6.4 million and a related after-tax decrease to retained earnings of $4.5 million. Our Day 1 ACL under the new CECL methodology totaled $68.1 million compared to $61.7 million under the incurred loss model at December 31, 2019, and represented 1.14% of total loans. We recorded a Day 2 provision for credit losses of $15.8 million which reflects the new CECL methodology using current economic forecasts and the estimated future impact of the COVID-19 pandemic on lifetime credit losses. At March 31, 2020, the ACL totaled $82.1 million resulting in an ACL to total loans coverage ratio of 1.45%, up from 1.04% at December 31, 2019. The ACL and provision for credit losses include amounts for unfunded commitments.
Income Statement Highlights | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| |||||||||||||||
($ in thousands) | |||||||||||||||||||
Total interest and dividend income | $ | 74,714 | $ | 83,702 | $ | 92,657 | $ | 104,040 | $ | 110,712 | |||||||||
Total interest expense | 22,853 | 27,042 | 33,742 | 39,260 | 42,904 | ||||||||||||||
Net interest income | 51,861 | 56,660 | 58,915 | 64,780 | 67,808 | ||||||||||||||
Total noninterest income (loss) | 2,061 | 4,930 | 3,181 | (2,290 | ) | 6,295 | |||||||||||||
Total revenue | 53,922 | 61,590 | 62,096 | 62,490 | 74,103 | ||||||||||||||
Total noninterest expense | 46,919 | 47,483 | 43,240 | 43,500 | 62,249 | ||||||||||||||
Pre-tax / pre-provision income | 7,003 | 14,107 | 18,856 | 18,990 | 11,854 | ||||||||||||||
Provision for (reversal of) credit losses | 15,761 | (2,976 | ) | 38,607 | (1,900 | ) | 2,098 | ||||||||||||
Income tax (benefit) expense | (2,165 | ) | 2,811 | (5,619 | ) | 4,308 | 2,719 | ||||||||||||
Net (loss) income | $ | (6,593 | ) | $ | 14,272 | $ | (14,132 | ) | $ | 16,582 | $ | 7,037 | |||||||
Net (loss) income available to common stockholders(1) | $ | (9,694 | ) | $ | 10,415 | $ | (22,722 | ) | $ | 11,909 | $ | 2,527 | |||||||
(1) | Balance represents the net (loss) income available to common stockholders after subtracting preferred stock dividends, income allocated to participating securities, participating securities dividends and impact of preferred stock redemption from net (loss) income. Refer to the Statement of Operations for additional detail on these amounts. |
Net interest income
Net interest income decreased $4.8 million to $51.9 million for the first quarter due to the combination of lower average interest-earning assets and a lower net interest margin. Average interest-earning assets declined from the prior quarter by $354.7 million to $7.03 billion, including a $440.4 million reduction in average loans to $5.78 billion, and our net interest margin declined 7 basis points to 2.97%.
The lower net interest margin was due to a 23 basis point decline in the average yield on interest-earning assets to 4.27%, partially offset by a 14 basis point decline on the average cost of interest bearing liabilities to 1.71%. The decline in the earning asset yield was due mostly to lower yields on most interest-earning asset classes due to originating new business and repricing variable rate loans and investments in the lower interest rate environment given the cuts in the federal funds target rates during the current and prior quarters. On a linked-quarter basis, our average yield on loans declined 15 basis points to 4.56% and our average yield on securities decreased 42 basis points. The average yield for variable rate collateralized loan obligations (CLOs) was 3.60% for the first quarter compared to 3.81% for the fourth quarter as this investment class reprices quarterly.
The 14 basis point decline in the average cost of interest-bearing liabilities to 1.71% for the first quarter from 1.85% for the fourth quarter, was driven by the lower average cost of interest-bearing deposits and higher average noninterest-bearing deposits. The average cost of interest-bearing deposits declined 16 basis points to 1.41% from the prior quarter. Additionally, average noninterest-bearing deposits increased by $25.2 million, or 2.3%, and represented 21.4% of total average deposits in the first quarter. Our total cost of deposits decreased 16 basis points to 1.11% for the first quarter. The decrease in our funding cost is due to a lower reliance on high cost transaction accounts and wholesale funds as we have managed down the balance sheet and continue to execute on our strategy to focus on relationship clients.
Provision for credit losses
We recognized a provision for credit losses of $15.8 million under the CECL model compared to a recovery of credit losses of $3.0 million in the prior quarter under the incurred loss model. Our provision for credit losses includes $1.1 million related to unfunded commitments. The higher provision for credit losses was driven by using the new CECL model, the estimated future impact of the health crisis on our loans, and net charge-offs, partially offset by lower period end loan balances of $284.4 million. For the first quarter, approximately $19 million of the provision for credit losses was attributed to the change in the economic forecast.
Noninterest income
Noninterest income decreased $2.9 million, or 58%, to $2.1 million for the first quarter from the prior quarter. The decrease was primarily due to the impact of lower market interest rates on certain assets subject to fair value accounting including a $1.6 million decrease in the fair value of loans held for sale, a $333 thousand decrease in the fair value of customer-related loan swaps, and a $166 thousand decrease in the value of servicing assets due mostly to the impact of prepayment assumptions. In addition, the prior quarter included a $650 thousand insurance recovery; there was no similar insurance recovery in the current quarter. These decreases were offset in part by lower net losses on sales of loans of $860 thousand.
Noninterest expense
Noninterest expense decreased $564 thousand to $46.9 million for the first quarter compared to the prior quarter. Noninterest expense decreased due to: (1) lower salaries and benefits expense of $600 thousand primarily related to lower headcount and loan production-based incentives, (2) lower regulatory assessments of $1.4 million related to changes in the size of our asset base and an FDIC assessment credit, and (3) lower restructuring expense of $1.6 million as the prior quarter included certain severance costs compared to none in the current quarter. These decreases were offset in part by higher professional fees of $3.4 million as a result of the timing of certain legal costs and recoveries compared to the prior quarter, and a $866 thousand increase in loss on investments in alternative energy partnerships. The change in professional fees attributed to the timing difference of certain indemnified legal costs and recoveries was $1.7 million. When such indemnified legal costs and recoveries are excluded, professional fees would have decreased $1.9 million from the prior quarter and totaled $4.3 million for the first quarter. Other includes an $850 thousand charge to settle a legacy lending claim from an acquired bank; there was no similar item in the prior quarter. Total operating costs, defined as noninterest expense adjusted for certain non-core items (refer to section Non-GAAP Measures), decreased $5.0 million to $43.3 million for the first quarter compared to the prior quarter.
Income taxes
Income tax benefit totaled $2.2 million for the first quarter resulting in an effective tax rate of 24.7%. This compares to a $2.8 million expense for the fourth quarter and an effective tax benefit rate of 16.5%. The estimated effective tax rate for 2020 is approximately 25%.
Balance Sheet
At March 31, 2020, total assets were $7.66 billion, which represented a linked quarter decrease of $165.8 million, consistent with our strategic shift towards reducing non-core assets and focus on relationship lending. The following table shows selected balance sheet line items as of the dates indicated.
As of and for the Three Months Ended | Amount Change | |||||||||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| Q1-20 vs. Q4-19 | Q1-20 vs. Q1-19 | ||||||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||||
Total assets | $ | 7,662,607 | $ | 7,828,410 | $ | 8,625,337 | $ | 9,359,931 | $ | 9,886,525 | $ | (165,803 | ) | $ | (2,223,918 | ) | ||||||||||||
Securities available-for-sale | $ | 969,427 | $ | 912,580 | $ | 775,662 | $ | 1,167,687 | $ | 1,471,303 | $ | 56,847 | $ | (501,876 | ) | |||||||||||||
Loans held-for-investment | $ | 5,667,464 | $ | 5,951,885 | $ | 6,383,259 | $ | 6,719,570 | $ | 7,557,200 | $ | (284,421 | ) | $ | (1,889,736 | ) | ||||||||||||
Loans held-for-sale | $ | 20,234 | $ | 22,642 | $ | 23,936 | $ | 597,720 | $ | 25,191 | $ | (2,408 | ) | $ | (4,957 | ) | ||||||||||||
Demand deposits | $ | 2,828,470 | $ | 2,622,398 | $ | 2,602,011 | $ | 2,510,233 | $ | 2,690,738 | $ | 206,072 | $ | 137,732 | ||||||||||||||
Other core deposits | 2,515,703 | 2,794,769 | 3,074,936 | 3,301,080 | 3,575,140 | (279,066 | ) | (1,059,437 | ) | |||||||||||||||||||
Brokered deposits | 218,665 | 10,000 | 93,111 | 480,977 | 1,459,054 | 208,665 | (1,240,389 | ) | ||||||||||||||||||||
Total Deposits | $ | 5,562,838 | $ | 5,427,167 | $ | 5,770,058 | $ | 6,292,290 | $ | 7,724,932 | $ | 135,671 | $ | (2,162,094 | ) | |||||||||||||
As percentage of total deposits | ||||||||||||||||||||||||||||
Demand deposits | 50.85 | % | 48.32 | % | 45.10 | % | 39.89 | % | 34.83 | % | 2.53 | % | 16.02 | % | ||||||||||||||
Other core deposits | 45.22 | % | 51.50 | % | 53.29 | % | 52.46 | % | 46.28 | % | (6.28 | )% | (1.06 | )% | ||||||||||||||
Brokered deposits | 3.93 | % | 0.18 | % | 1.61 | % | 7.64 | % | 18.89 | % | 3.75 | % | (14.96 | )% | ||||||||||||||
Average loan yield | 4.56 | % | 4.71 | % | 4.75 | % | 4.80 | % | 4.76 | % | (0.15 | )% | (0.20 | )% | ||||||||||||||
Average cost of interest-bearing deposits | 1.41 | % | 1.57 | % | 1.78 | % | 1.89 | % | 1.92 | % | (0.16 | )% | (0.51 | )% | ||||||||||||||
Average cost of deposits | 1.11 | % | 1.27 | % | 1.48 | % | 1.62 | % | 1.67 | % | (0.16 | )% | (0.56 | )% | ||||||||||||||
Investments
Securities available-for-sale increased $56.8 million to $969.4 million at March 31, 2020, primarily due to purchases of $147.4 million of corporate debt and government agency securities, offset by net CLO maturities of $30.0 million and a higher net unrealized loss of $59.9 million due to changes in market prices and expectations attributed mainly to the estimated impact of the COVID-19 pandemic. The CLOs are AA and AAA rated and the carrying value includes an unrealized net loss of $80.0 million. As of March 31, 2020, our securities portfolio included $623.6 million of CLOs, $243.4 million of agency securities, $54.4 million of municipal securities, and $47.9 million of corporate debt securities.
Loans
The following table sets forth the composition, by loan category, of our loan portfolio as of the dates indicated:
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||
($ in thousands) | ||||||||||||||||||||
Composition of held-for-investment loans | ||||||||||||||||||||
Commercial real estate | $ | 810,024 | $ | 818,817 | $ | 891,029 | $ | 856,497 | $ | 865,521 | ||||||||||
Multifamily | 1,466,083 | 1,494,528 | 1,563,757 | 1,598,978 | 2,332,527 | |||||||||||||||
Construction | 227,947 | 231,350 | 228,561 | 209,029 | 211,549 | |||||||||||||||
Commercial and industrial | 1,578,223 | 1,691,270 | 1,789,478 | 1,951,707 | 1,907,102 | |||||||||||||||
SBA | 70,583 | 70,981 | 75,359 | 80,929 | 74,998 | |||||||||||||||
Total commercial loans | 4,152,860 | 4,306,946 | 4,548,184 | 4,697,140 | 5,391,697 | |||||||||||||||
Single-family residential mortgage | 1,467,375 | 1,590,774 | 1,775,953 | 1,961,065 | 2,102,694 | |||||||||||||||
Other consumer | 47,229 | 54,165 | 59,122 | 61,365 | 62,809 | |||||||||||||||
Total consumer loans | 1,514,604 | 1,644,939 | 1,835,075 | 2,022,430 | 2,165,503 | |||||||||||||||
Total gross loans | $ | 5,667,464 | $ | 5,951,885 | $ | 6,383,259 | $ | 6,719,570 | $ | 7,557,200 | ||||||||||
Composition percentage of held-for-investment loans | ||||||||||||||||||||
Commercial real estate | 14.3 | % | 13.8 | % | 14.0 | % | 12.7 | % | 11.5 | % | ||||||||||
Multifamily | 25.9 | % | 25.1 | % | 24.5 | % | 23.8 | % | 30.9 | % | ||||||||||
Construction | 4.0 | % | 3.9 | % | 3.6 | % | 3.1 | % | 2.8 | % | ||||||||||
Commercial and industrial | 27.9 | % | 28.4 | % | 28.0 | % | 29.1 | % | 25.2 | % | ||||||||||
SBA | 1.2 | % | 1.2 | % | 1.2 | % | 1.2 | % | 1.0 | % | ||||||||||
Total commercial loans | 73.3 | % | 72.4 | % | 71.3 | % | 69.9 | % | 71.4 | % | ||||||||||
Single-family residential mortgage | 25.9 | % | 26.7 | % | 27.8 | % | 29.2 | % | 27.8 | % | ||||||||||
Other consumer | 0.8 | % | 0.9 | % | 0.9 | % | 0.9 | % | 0.8 | % | ||||||||||
Total consumer loans | 26.7 | % | 27.6 | % | 28.7 | % | 30.1 | % | 28.6 | % | ||||||||||
Total gross loans | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||
Held-for-investment loans decreased $284.4 million to $5.67 billion from the prior quarter, due mostly to lower single-family residential mortgage loans of $123.4 million, lower commercial and industrial (C&I) loans of $113.0 million, and lower multifamily loans of $28.4 million. The decline in single-family residential is attributed to accelerated payoffs as the loans refinance away in the lower rate environment and proceeds are invested in other core business loans. The decline in C&I loans is primarily in response to strategically reducing certain credit facilities in response to the changed economic landscape and corresponding lower outstanding balances. The impact of the COVID-19 pandemic tempered loan production for the last part of the quarter and we did not experience any significant increase in credit line usage.
We continue to remix our real estate loan portfolio toward relationship-based multifamily, bridge, light infill construction, and commercial real estate loans. We are no longer originating single-family residential mortgage loans. Single-family residential mortgage and multifamily loans comprise 51.8% of the total held-for-investment loan portfolio as compared to 58.7% one year ago. Commercial real estate loans comprised 14.3% of the loan portfolio and commercial and industrial loans constituted 27.9%. Currently, loans secured by residential real estate (single-family, multifamily, single-family construction, and credit facilities) represent approximately 83% of our total loans outstanding.
The C&I portfolio has limited exposure to certain business sectors undergoing severe stress, as demonstrated by the following (as a percentage of total outstanding C&I loan balances):
March 31, 2020 | |||||||
Amount | % of Portfolio | ||||||
C&I Portfolio by Industry | ($ in thousands) | ||||||
Real estate and rental and leasing | $ | 205,206 | 13 | % | |||
Retail trade | 116,202 | 7 | % | ||||
Finance and insurance | 872,049 | 55 | % | ||||
Manufacturing | 73,299 | 5 | % | ||||
Healthcare and social assistance | 54,091 | 3 | % | ||||
Wholesale trade | 43,285 | 3 | % | ||||
Accommodation and food services | 31,867 | 2 | % | ||||
All other | 182,224 | 12 | % | ||||
$ | 1,578,223 | 100 | % | ||||
Deposits
The following table sets forth the composition of our deposits at the dates indicated.
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||
($ in thousands) | ||||||||||||||||||||
Composition of deposits | ||||||||||||||||||||
Noninterest-bearing checking | $ | 1,256,081 | $ | 1,088,516 | $ | 1,107,442 | $ | 993,745 | $ | 1,120,700 | ||||||||||
Interest-bearing checking | 1,572,389 | 1,533,882 | 1,503,208 | 1,577,901 | 1,573,499 | |||||||||||||||
Money market | 575,820 | 715,479 | 695,530 | 800,898 | 899,330 | |||||||||||||||
Savings | 877,947 | 885,246 | 1,042,162 | 1,061,115 | 1,151,442 | |||||||||||||||
Non-brokered certificates of deposit | 1,071,936 | 1,204,044 | 1,367,284 | 1,479,137 | 1,684,895 | |||||||||||||||
Brokered certificates of deposit | 208,665 | — | 54,432 | 379,494 | 1,295,066 | |||||||||||||||
Total deposits | $ | 5,562,838 | $ | 5,427,167 | $ | 5,770,058 | $ | 6,292,290 | $ | 7,724,932 | ||||||||||
Composition percentage of deposits | ||||||||||||||||||||
Noninterest-bearing checking | 22.6 | % | 20.1 | % | 19.2 | % | 15.8 | % | 14.5 | % | ||||||||||
Interest-bearing checking | 28.3 | % | 28.2 | % | 26.1 | % | 25.1 | % | 20.4 | % | ||||||||||
Money market | 10.3 | % | 13.2 | % | 12.0 | % | 12.7 | % | 11.6 | % | ||||||||||
Savings | 15.8 | % | 16.3 | % | 18.1 | % | 16.9 | % | 14.9 | % | ||||||||||
Non-brokered certificates of deposit | 19.3 | % | 22.2 | % | 23.7 | % | 23.5 | % | 21.8 | % | ||||||||||
Brokered certificates of deposit | 3.7 | % | — | % | 0.9 | % | 6.0 | % | 16.8 | % | ||||||||||
Total deposits | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||
Total deposits increased $135.7 million during the first quarter of 2020 to $5.56 billion due to higher noninterest-bearing checking balances of $167.6 million, interest-bearing checking balances of $38.5 million and brokered certificates of deposit balances of $208.7 million, offset by lower money market balances of $139.7 million, savings balances of $7.3 million, and non-brokered certificates of deposit balances of $132.1 million. We continue to focus on growing relationship-based deposits, strategically supplemented wholesale funding, as we proactively drive our funding costs down. Noninterest-bearing deposits totaled $1.26 billion and represented 22.6% of total deposits at March 31, 2020 compared to $1.09 billion and 20.1% at December 31, 2019 and $1.12 billion and 14.5% one year ago.
Debt
Advances from the FHLB decreased $217.0 million, or 18%, to $978.0 million, as of March 31, 2020, due to lower short term and overnight advances of $193.0 million and the maturity of $24.0 million in long term fixed-rate advances. At the end of the first quarter, FHLB advances included $90.0 million of overnight borrowings, $174.0 million maturing within three months, and $714.0 million maturing beyond three months with a weighted average life of 3.2 years and weighted average rate of 2.58%.
Equity
At March 31, 2020, total stockholders’ equity decreased by $72.2 million to $835.0 million on a linked-quarter basis, while tangible common equity decreased by $69.7 million to $606.4 million. The decrease in total stockholders’ equity related to the net loss of $6.6 million, the cumulative-effect adjustment of adoption of CECL of $4.5 million, dividends to common and preferred stockholders of $6.5 million, redemption of preferred stock of $1.6 million, repurchases of common stock under our previously announced share repurchase program of $12.0 million, and an increase in accumulated other comprehensive loss, net, of $42.2 million related to the lower fair value of CLOs and other securities available-for-sale.
In February 2020 we announced a share repurchase program for a total amount of $45.0 million and we repurchased 827,584 shares of common stock for an aggregate cost of $12.0 million. Given current macroeconomic conditions and the yet-to-be-determined impacts of the COVID-19 crisis, we have suspended common stock repurchases for the immediate future.
Capital ratios remain strong with total risk-based capital at 16.16% and a tier 1 leverage ratio of 11.20%. The following table sets forth our regulatory capital ratios at March 31, 2020 and the previous four quarters. The interim capital relief related to the adoption of CECL increased the Bank's leverage ratio approximately 10 basis points at March 31, 2020.
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| |||||||||||
Capital Ratios(1) | |||||||||||||||
Banc of California, Inc. | |||||||||||||||
Total risk-based capital ratio | 16.16 | % | 15.90 | % | 14.37 | % | 15.00 | % | 14.01 | % | |||||
Tier 1 risk-based capital ratio | 14.91 | % | 14.83 | % | 13.32 | % | 14.03 | % | 13.03 | % | |||||
Common equity tier 1 capital ratio | 11.57 | % | 11.56 | % | 10.34 | % | 10.50 | % | 9.72 | % | |||||
Tier 1 leverage ratio | 11.20 | % | 10.89 | % | 9.84 | % | 9.62 | % | 8.87 | % | |||||
Banc of California, NA | |||||||||||||||
Total risk-based capital ratio | 18.21 | % | 17.46 | % | 15.65 | % | 16.70 | % | 15.79 | % | |||||
Tier 1 risk-based capital ratio | 16.96 | % | 16.39 | % | 14.60 | % | 15.73 | % | 14.81 | % | |||||
Common equity tier 1 capital ratio | 16.96 | % | 16.39 | % | 14.60 | % | 15.73 | % | 14.81 | % | |||||
Tier 1 leverage ratio | 12.67 | % | 12.02 | % | 10.75 | % | 10.80 | % | 10.07 | % | |||||
(1) | March 31, 2020 capital ratios are preliminary. |
Credit Quality | ||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||
Asset quality information and ratios | ($ in thousands) | |||||||||||||||||||
Delinquent loans held-for-investment | ||||||||||||||||||||
30 to 89 days delinquent | $ | 56,338 | $ | 32,873 | $ | 39,122 | $ | 34,938 | $ | 44,840 | ||||||||||
90+ days delinquent | 28,632 | 24,734 | 17,220 | 17,272 | 14,623 | |||||||||||||||
Total delinquent loans | $ | 84,970 | $ | 57,607 | $ | 56,342 | $ | 52,210 | $ | 59,463 | ||||||||||
Total delinquent loans to total loans | 1.50 | % | 0.97 | % | 0.88 | % | 0.78 | % | 0.79 | % | ||||||||||
Non-performing assets, excluding loans held-for-sale | ||||||||||||||||||||
Non-performing loans | $ | 56,471 | $ | 43,354 | $ | 45,169 | $ | 28,499 | $ | 27,739 | ||||||||||
90+ days delinquent and still accruing loans | — | — | — | 275 | 731 | |||||||||||||||
Other real estate owned | — | — | — | 276 | 316 | |||||||||||||||
Non-performing assets | $ | 56,471 | $ | 43,354 | $ | 45,169 | $ | 29,050 | $ | 28,786 | ||||||||||
ALL to non-performing loans | 138.55 | % | 132.97 | % | 139.31 | % | 206.86 | % | 224.40 | % | ||||||||||
Non-performing loans to total loans held-for-investment | 1.00 | % | 0.73 | % | 0.71 | % | 0.43 | % | 0.38 | % | ||||||||||
Non-performing assets to total assets | 0.74 | % | 0.55 | % | 0.52 | % | 0.31 | % | 0.29 | % | ||||||||||
Troubled debt restructurings (TDRs) | ||||||||||||||||||||
Performing TDRs | $ | 6,100 | $ | 6,620 | $ | 6,800 | $ | 20,245 | $ | 5,574 | ||||||||||
Non-performing TDRs | 20,852 | 21,837 | 14,605 | 2,428 | 1,943 | |||||||||||||||
Total TDRs | $ | 26,952 | $ | 28,457 | $ | 21,405 | $ | 22,673 | $ | 7,517 | ||||||||||
Credit quality remains strong. Total delinquent loans increased $27.4 million in the first quarter to $85.0 million at March 31, 2020, due to $43.1 million of additions, offset by $8.5 million returning to current status and $7.3 million of principal payments or payoffs. Delinquent loans includes primarily legacy single-family residential mortgage loans, which account for 84% of the balance and $28.0 million of the increase quarter over quarter. Excluding delinquent legacy single-family loans, delinquent loans are $13.6 million, or 0.24%, of total loans at March 31, 2020. We ceased originating single-family mortgage loans in the second quarter of 2019.
Non-performing loans totaled $56.5 million as of March 31, 2020, of which $21.5 million or 38% of the balance relates to loans in a current payment status. The $13.1 million increase during the first quarter was primarily due to $14.1 million of loans being placed on nonaccrual status, offset by cured loans and payoffs. The quarter-end balance includes two large loans with delinquent payment status that comprise 45% of our total nonperforming loans, consisting of one $16.4 million legacy shared national credit and a $9.1 million single-family mortgage residential loan with a loan-to-value ratio of 67%. Aside from those two loans, nonperforming loans total $31.0 million, of which 49% relates to legacy single-family residential mortgage loans.
In light of the COVID-19 crisis, we have provided support to clients by granting loan deferments, when requested and supported by our borrowers. As of April 27, in our SFR portfolio, we had 122 active deferments on $123 million of principal balances, or approximately 8% of the portfolio. With respect to our non-SFR loan portfolio, as of April 27, we had 68 active deferments on $257 million of principal balances or 6% of our non-SFR portfolio. As with our entire portfolio, we will continue to actively monitor and manage our lending relationships in a manner that supports our clients and protects the bank.
Allowance for Credit Losses | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||
($ in thousands) | ||||||||||||||||||||
Allowance for loan losses (ALL) | ||||||||||||||||||||
Balance at beginning of period | $ | 57,649 | $ | 62,927 | $ | 59,523 | $ | 63,885 | $ | 62,192 | ||||||||||
Adoption of ASU 2016-13 (1) | 7,609 | — | — | — | — | |||||||||||||||
Loans charged off | (2,076 | ) | (2,706 | ) | (35,546 | ) | (2,451 | ) | (1,063 | ) | ||||||||||
Recoveries | 350 | 106 | 410 | 76 | 244 | |||||||||||||||
Net charge-offs | (1,726 | ) | (2,600 | ) | (35,136 | ) | (2,375 | ) | (819 | ) | ||||||||||
Provision for (reversal of) loan losses | 14,711 | (2,678 | ) | 38,540 | (1,987 | ) | 2,512 | |||||||||||||
Balance at end of period | 78,243 | $ | 57,649 | $ | 62,927 | $ | 59,523 | $ | 63,885 | |||||||||||
Reserve for unfunded loan commitments | ||||||||||||||||||||
Balance at beginning of period | 4,064 | 4,362 | 4,295 | 4,208 | 4,622 | |||||||||||||||
Adoption of ASU 2016-13 (1) | (1,226 | ) | — | — | — | — | ||||||||||||||
Provision for credit losses | 1,050 | (298 | ) | 67 | 87 | (414 | ) | |||||||||||||
Balance at end of period | 3,888 | 4,064 | 4,362 | 4,295 | 4,208 | |||||||||||||||
Allowance for credit losses (ACL) | $ | 82,131 | $ | 61,713 | $ | 67,289 | $ | 63,818 | $ | 68,093 | ||||||||||
ALL to total loans | 1.38 | % | 0.97 | % | 0.99 | % | 0.89 | % | 0.85 | % | ||||||||||
ACL to total loans | 1.45 | % | 1.04 | % | 1.05 | % | 0.95 | % | 0.90 | % | ||||||||||
Annualized net loan charge-offs to average total loans held-for-investment | 0.12 | % | 0.17 | % | 2.19 | % | 0.13 | % | 0.04 | % | ||||||||||
Reserve for loss on repurchased loans | ||||||||||||||||||||
Balance at beginning of period | $ | 6,201 | $ | 6,561 | $ | 2,478 | $ | 2,486 | $ | 2,506 | ||||||||||
Initial provision for loan repurchases | — | — | 4,415 | 53 | 96 | |||||||||||||||
Reversal of provision for loan repurchases | (600 | ) | (360 | ) | (123 | ) | (61 | ) | (116 | ) | ||||||||||
Utilization of reserve for loan repurchases | — | — | (209 | ) | — | — | ||||||||||||||
Balance at end of period | $ | 5,601 | $ | 6,201 | $ | 6,561 | $ | 2,478 | $ | 2,486 | ||||||||||
(1) | Represents the impact of adopting ASU 2016-13, Financial Instruments - Credit Losses on January 1, 2020. As a result of adopting ASU 2016-13, our methodology to compute our allowance for credit losses is based on a current expected credit loss methodology, rather that the previously applied incurred loss methodology. |
The allowance for expected credit losses, which includes the reserve for unfunded loan commitments, totaled $82.1 million, or 1.45% of total loans at March 31, 2020 compared to $61.7 million or 1.04% at December 31, 2019. The $20.4 million increase in the allowance reflects a higher provision due to the earlier recognition of losses under CECL and the impact of the change in the economic forecast scenarios as of quarter end, including the expected impact of the COVID-19 pandemic on future losses. This increase includes a Day 1 transition adjustment amount of $6.4 million and a Day 2 provision of $15.8 million, offset by net charge-offs of $1.7 million. The net charge-offs included $1.1 million in C&I loans and $401 thousand in SFR mortgages. The ACL coverage of non-performing loans was 145% at March 31, 2020 compared to 142% at December 31, 2019.
Our ACL methodology and resulting provision is significantly impacted by the current economic uncertainty and volatility caused by the COVID-19 pandemic. Our ACL methodology uses a nationally-recognized, third party model that includes many assumptions based on our historical and peer loss data, our current loan portfolio risk profile, and economic forecasts. We used economic forecasts released by our model provider during the last week of March which included the onset of the pandemic. These forecasts included a sharp contraction in annualized GDP growth and a sharp spike in near-term unemployment rates ranging from 8% to 13%, before returning to moderate long-term economic trends. Our visibility at the end of the quarter indicated that local unemployment was heading higher and that the economic recovery would likely be slower. Accordingly, we incorporated qualitative factors to account for this visibility at quarter end related to actual conditions and an economic outlook that was worse than the late March forecasts incorporated into the CECL model. As a result of the COVID-19 pandemic and adoption of CECL, we expect our allowance for credit losses to continue to be impacted in future periods by economic volatility, changing economic forecasts, as well as the related impacts to CECL model assumptions, all of which may be better than or worse than our current estimate.
The reserve for loss on repurchased loans decreased by $600 thousand in the first quarter due to continued runoff of principal balances associated with the multifamily loan securitization and single-family residential mortgage loans previously sold. This reduction in the associated sold balances results in reduced anticipated losses from repurchases.
The Company will host a conference call to discuss its first quarter 2020 financial results at 10:00 a.m. Pacific Time (PT) on Wednesday, April 29, 2020. Interested parties are welcome to attend the conference call by dialing (888) 317-6003, and referencing event code 5112344. 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.
About Banc of California, Inc.
Banc of California, Inc. (NYSE: BANC) is a bank holding company with approximately $7.7 billion in assets and one wholly-owned banking subsidiary, Banc of California, N.A. (the “Bank”). The Bank has 42 offices including 31 full-service branches located throughout Southern California. Through our dedicated professionals, we provide customized and innovative banking and lending solutions to businesses, entrepreneurs and individuals throughout California. We help to improve the communities where we live and work, by supporting organizations that provide financial literacy and job training, small business support and affordable housing. With a commitment to service and building enduring relationships, we provide a higher standard of banking. We look forward to helping you achieve your goals. 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. 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. with the Securities and Exchange Commission. In addition to those, statements about the potential effects of the COVID-19 pandemic on the business, financial results and condition of Banc of California, Inc. and its subsidiaries may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond the control of Banc of California, Inc., including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on Banc of California Inc. and its subsidiaries, their customers and third parties. You should not place undue reliance on forward-looking statements and Banc of California, Inc. undertakes no obligation to update any such statements to reflect circumstances or events that occur after the date on which the forward-looking statement is made.
Banc of California, Inc. | ||||||||||||||||||||
Consolidated Statements of Financial Condition (Unaudited) | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||
ASSETS | ||||||||||||||||||||
Cash and cash equivalents | $ | 435,992 | $ | 373,472 | $ | 526,874 | $ | 313,850 | $ | 304,705 | ||||||||||
Securities available-for-sale | 969,427 | 912,580 | 775,662 | 1,167,687 | 1,471,303 | |||||||||||||||
Loans held-for-sale | 20,234 | 22,642 | 23,936 | 597,720 | 25,191 | |||||||||||||||
Loans held-for-investment | 5,667,464 | 5,951,885 | 6,383,259 | 6,719,570 | 7,557,200 | |||||||||||||||
Allowance for loan losses | (78,243 | ) | (57,649 | ) | (62,927 | ) | (59,523 | ) | (63,885 | ) | ||||||||||
Federal Home Loan Bank and other bank stock | 57,237 | 59,420 | 71,679 | 76,373 | 55,794 | |||||||||||||||
Servicing rights, net | 2,009 | 2,299 | 2,407 | 2,715 | 3,053 | |||||||||||||||
Other real estate owned, net | — | — | — | 276 | 316 | |||||||||||||||
Premises and equipment, net | 127,379 | 128,021 | 128,979 | 129,227 | 130,417 | |||||||||||||||
Investments in alternative energy partnerships, net | 27,347 | 29,300 | 27,039 | 26,633 | 26,578 | |||||||||||||||
Goodwill | 37,144 | 37,144 | 37,144 | 37,144 | 37,144 | |||||||||||||||
Other intangible assets, net | 3,722 | 4,151 | 4,605 | 5,105 | 5,726 | |||||||||||||||
Deferred income tax, net | 63,849 | 44,906 | 45,950 | 42,798 | 45,111 | |||||||||||||||
Income tax receivable | 7,198 | 4,233 | 4,459 | 2,547 | 4,787 | |||||||||||||||
Bank owned life insurance investment | 110,397 | 109,819 | 108,720 | 108,132 | 107,552 | |||||||||||||||
Right of use assets | 20,882 | 22,540 | 23,907 | 24,118 | 24,519 | |||||||||||||||
Due from unsettled securities sales | — | — | 334,769 | — | — | |||||||||||||||
Other assets | 190,569 | 183,647 | 188,875 | 165,559 | 151,014 | |||||||||||||||
Total assets | $ | 7,662,607 | $ | 7,828,410 | $ | 8,625,337 | $ | 9,359,931 | $ | 9,886,525 | ||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
Noninterest-bearing deposits | $ | 1,256,081 | $ | 1,088,516 | $ | 1,107,442 | $ | 993,745 | $ | 1,120,700 | ||||||||||
Interest-bearing deposits | 4,306,757 | 4,338,651 | 4,662,616 | 5,298,545 | 6,604,232 | |||||||||||||||
Total deposits | 5,562,838 | 5,427,167 | 5,770,058 | 6,292,290 | 7,724,932 | |||||||||||||||
Advances from Federal Home Loan Bank | 978,000 | 1,195,000 | 1,650,000 | 1,825,000 | 935,000 | |||||||||||||||
Notes payable, net | 173,479 | 173,421 | 173,339 | 173,257 | 173,203 | |||||||||||||||
Reserve for loss on repurchased loans | 5,601 | 6,201 | 6,561 | 2,478 | 2,486 | |||||||||||||||
Lease liabilities | 22,075 | 23,692 | 25,210 | 25,457 | 25,893 | |||||||||||||||
Accrued expenses and other liabilities | 85,612 | 95,684 | 99,181 | 77,905 | 76,686 | |||||||||||||||
Total liabilities | 6,827,605 | 6,921,165 | 7,724,349 | 8,396,387 | 8,938,200 | |||||||||||||||
Commitments and contingent liabilities | ||||||||||||||||||||
Preferred stock | 187,687 | 189,825 | 189,825 | 231,128 | 231,128 | |||||||||||||||
Common stock | 520 | 520 | 520 | 520 | 518 | |||||||||||||||
Common stock, class B non-voting non-convertible | 5 | 5 | 5 | 5 | 5 | |||||||||||||||
Additional paid-in capital | 631,125 | 629,848 | 628,774 | 627,306 | 626,608 | |||||||||||||||
Retained earnings | 110,640 | 127,733 | 120,221 | 146,039 | 136,943 | |||||||||||||||
Treasury stock | (40,827 | ) | (28,786 | ) | (28,786 | ) | (28,786 | ) | (28,786 | ) | ||||||||||
Accumulated other comprehensive loss, net | (54,148 | ) | (11,900 | ) | (9,571 | ) | (12,668 | ) | (18,091 | ) | ||||||||||
Total stockholders’ equity | 835,002 | 907,245 | 900,988 | 963,544 | 948,325 | |||||||||||||||
Total liabilities and stockholders’ equity | $ | 7,662,607 | $ | 7,828,410 | $ | 8,625,337 | $ | 9,359,931 | $ | 9,886,525 | ||||||||||
Banc of California, Inc. | ||||||||||||||||||||
Consolidated Statements of Operations (Unaudited) | ||||||||||||||||||||
(Dollars in thousands, except per share data) | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||
Interest and dividend income | ||||||||||||||||||||
Loans, including fees | $ | 65,534 | $ | 73,930 | $ | 80,287 | $ | 89,159 | $ | 90,558 | ||||||||||
Securities | 7,820 | 7,812 | 10,024 | 12,457 | 17,841 | |||||||||||||||
Other interest-earning assets | 1,360 | 1,960 | 2,346 | 2,424 | 2,313 | |||||||||||||||
Total interest and dividend income | 74,714 | 83,702 | 92,657 | 104,040 | 110,712 | |||||||||||||||
Interest expense | ||||||||||||||||||||
Deposits | 14,611 | 18,247 | 22,811 | 28,598 | 31,443 | |||||||||||||||
Federal Home Loan Bank advances | 5,883 | 6,396 | 8,519 | 8,289 | 9,081 | |||||||||||||||
Notes payable and other interest-bearing liabilities | 2,359 | 2,399 | 2,412 | 2,373 | 2,380 | |||||||||||||||
Total interest expense | 22,853 | 27,042 | 33,742 | 39,260 | 42,904 | |||||||||||||||
Net interest income | 51,861 | 56,660 | 58,915 | 64,780 | 67,808 | |||||||||||||||
Provision for (reversal of) credit losses | 15,761 | (2,976 | ) | 38,607 | (1,900 | ) | 2,098 | |||||||||||||
Net interest income after provision for (reversal of) credit losses | 36,100 | 59,636 | 20,308 | 66,680 | 65,710 | |||||||||||||||
Noninterest income | ||||||||||||||||||||
Customer service fees | 1,096 | 1,451 | 1,582 | 1,434 | 1,515 | |||||||||||||||
Loan servicing income | 75 | 312 | 128 | 121 | 118 | |||||||||||||||
Income from bank owned life insurance | 578 | 599 | 588 | 580 | 525 | |||||||||||||||
Impairment loss on investment securities | — | — | (731 | ) | — | — | ||||||||||||||
Net gain (loss) on sale of securities available for sale | — | 3 | (5,063 | ) | — | 208 | ||||||||||||||
Fair value adjustment on loans held for sale | (1,586 | ) | 30 | 16 | 59 | 1 | ||||||||||||||
Net (loss) gain on sale of loans | (27 | ) | (863 | ) | 4,310 | 2,767 | 1,552 | |||||||||||||
All other income (loss) | 1,925 | 3,398 | 2,351 | (7,251 | ) | 2,376 | ||||||||||||||
Total noninterest income (loss) | 2,061 | 4,930 | 3,181 | (2,290 | ) | 6,295 | ||||||||||||||
Noninterest expense | ||||||||||||||||||||
Salaries and employee benefits | 23,436 | 24,036 | 25,934 | 27,506 | 28,439 | |||||||||||||||
Occupancy and equipment | 7,243 | 7,900 | 7,767 | 7,955 | 7,686 | |||||||||||||||
Professional fees (reimbursement) | 5,964 | 2,611 | 1,463 | (2,903 | ) | 11,041 | ||||||||||||||
Data processing | 1,773 | 1,684 | 1,568 | 1,672 | 1,496 | |||||||||||||||
Advertising | 1,756 | 2,227 | 2,090 | 2,048 | 2,057 | |||||||||||||||
Regulatory assessments | 484 | 1,854 | 1,239 | 2,136 | 2,482 | |||||||||||||||
Reversal of loan repurchase reserves | (600 | ) | (360 | ) | (123 | ) | (61 | ) | (116 | ) | ||||||||||
Amortization of intangible assets | 429 | 454 | 500 | 621 | 620 | |||||||||||||||
Restructuring expense (reversal) | — | 1,626 | — | (158 | ) | 2,795 | ||||||||||||||
All other expenses | 4,529 | 4,412 | 3,742 | 5,039 | 3,799 | |||||||||||||||
Total noninterest expense excluding loss (gain) on investments in alternative energy partnerships | 45,014 | 46,444 | 44,180 | 43,855 | 60,299 | |||||||||||||||
Loss (gain) on investments in alternative energy partnerships | 1,905 | 1,039 | (940 | ) | (355 | ) | 1,950 | |||||||||||||
Total noninterest expense | 46,919 | 47,483 | 43,240 | 43,500 | 62,249 | |||||||||||||||
(Loss) income from operations before income taxes | (8,758 | ) | 17,083 | (19,751 | ) | 20,890 | 9,756 | |||||||||||||
Income tax (benefit) expense | (2,165 | ) | 2,811 | (5,619 | ) | 4,308 | 2,719 | |||||||||||||
Net (loss) income | (6,593 | ) | 14,272 | (14,132 | ) | 16,582 | 7,037 | |||||||||||||
Preferred stock dividends | 3,533 | 3,540 | 3,403 | 4,308 | 4,308 | |||||||||||||||
Income allocated to participating securities | — | 224 | — | 271 | — | |||||||||||||||
Participating securities dividends | 94 | 93 | 94 | 94 | 202 | |||||||||||||||
Impact of preferred stock redemption | (526 | ) | — | 5,093 | — | — | ||||||||||||||
Net (loss) income available to common stockholders | $ | (9,694 | ) | $ | 10,415 | $ | (22,722 | ) | $ | 11,909 | $ | 2,527 | ||||||||
(Loss) earnings per common share: | ||||||||||||||||||||
Basic | $ | (0.19 | ) | $ | 0.21 | $ | (0.45 | ) | $ | 0.23 | $ | 0.05 | ||||||||
Diluted | $ | (0.19 | ) | $ | 0.20 | $ | (0.45 | ) | $ | 0.23 | $ | 0.05 | ||||||||
Weighted average number of common shares outstanding | ||||||||||||||||||||
Basic | 50,464,777 | 50,699,915 | 50,882,227 | 50,857,137 | 50,676,722 | |||||||||||||||
Diluted | 50,464,777 | 50,927,978 | 50,882,227 | 50,964,956 | 50,846,722 | |||||||||||||||
Dividends declared per common share | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.13 | ||||||||||
Banc of California, Inc. | |||||||||||||||
Selected Financial Data | |||||||||||||||
(Unaudited) | |||||||||||||||
Three Months Ended | |||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| |||||||||||
Profitability and other ratios of consolidated operations | |||||||||||||||
Return on average assets(1) | (0.35 | )% | 0.71 | % | (0.64 | )% | 0.69 | % | 0.28 | % | |||||
Return on average equity(1) | (2.89 | )% | 6.20 | % | (5.83 | )% | 6.91 | % | 2.98 | % | |||||
Return on average tangible common equity(2) | (5.44 | )% | 6.46 | % | (12.49 | )% | 7.43 | % | 1.91 | % | |||||
Dividend payout ratio(3) | (31.58 | )% | 28.57 | % | (13.33 | )% | 26.09 | % | 260.00 | % | |||||
Net interest spread | 2.56 | % | 2.65 | % | 2.47 | % | 2.50 | % | 2.47 | % | |||||
Net interest margin(1) | 2.97 | % | 3.04 | % | 2.86 | % | 2.86 | % | 2.81 | % | |||||
Noninterest income (loss) to total revenue(4) | 3.82 | % | 8.00 | % | 5.12 | % | (3.66 | )% | 8.49 | % | |||||
Noninterest income (loss) to average total assets(1) | 0.11 | % | 0.25 | % | 0.15 | % | (0.10 | )% | 0.25 | % | |||||
Noninterest expense to average total assets(1) | 2.50 | % | 2.35 | % | 1.98 | % | 1.82 | % | 2.43 | % | |||||
Efficiency ratio(2)(5) | 87.01 | % | 77.10 | % | 69.63 | % | 69.61 | % | 84.00 | % | |||||
Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships(2)(5) | 86.54 | % | 74.51 | % | 70.00 | % | 67.70 | % | 83.57 | % | |||||
Average loans held-for-investment to average deposits | 108.54 | % | 108.50 | % | 105.92 | % | 104.38 | % | 100.45 | % | |||||
Average securities available-for-sale to average total assets | 12.60 | % | 10.48 | % | 12.71 | % | 13.58 | % | 17.00 | % | |||||
Average stockholders’ equity to average total assets | 12.11 | % | 11.47 | % | 11.06 | % | 10.02 | % | 9.29 | % | |||||
(1) | Ratios are presented on an annualized basis. | |
(2) | The ratios are determined by methods other than in accordance with U.S. generally accepted accounting principles (GAAP). See Non-GAAP measures section for reconciliation of the calculation. | |
(3) | The ratio is calculated by dividing dividends declared per common share by basic earnings per common share. | |
(4) | Total revenue is equal to the sum of net interest income before provision for credit losses and noninterest income (loss). | |
(5) | The ratios are calculated by dividing noninterest expense by the sum of net interest income before provision for credit losses and noninterest income (loss). |
Banc of California, Inc. | |||||||||||||||||||||||||||||||||
Average Balance, Average Yield Earned, and Average Cost Paid | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
March 31, 2020 | December 31, 2019 | September 30, 2019 | |||||||||||||||||||||||||||||||
Average | Yield | Average | Yield | Average | Yield | ||||||||||||||||||||||||||||
Balance | Interest | / Cost | Balance | Interest | / Cost | Balance | Interest | / Cost | |||||||||||||||||||||||||
Interest earning assets | |||||||||||||||||||||||||||||||||
Loans held-for-sale | $ | 22,273 | $ | 220 | 3.97 | % | $ | 23,527 | $ | 221 | 3.73 | % | $ | 216,746 | $ | 1,894 | 3.47 | % | |||||||||||||||
SFR mortgage | 1,532,967 | 15,295 | 4.01 | % | 1,689,228 | 16,788 | 3.94 | % | 1,866,103 | 19,179 | 4.08 | % | |||||||||||||||||||||
Commercial real estate, multifamily, and construction | 2,564,485 | 30,223 | 4.74 | % | 2,633,342 | 32,763 | 4.94 | % | 2,717,609 | 33,343 | 4.87 | % | |||||||||||||||||||||
Commercial and industrial, SBA, and lease financing | 1,613,324 | 19,157 | 4.78 | % | 1,821,064 | 23,381 | 5.09 | % | 1,840,202 | 24,970 | 5.38 | % | |||||||||||||||||||||
Other consumer | 47,761 | 639 | 5.38 | % | 54,088 | 777 | 5.70 | % | 58,652 | 901 | 6.09 | % | |||||||||||||||||||||
Gross loans and leases | 5,780,810 | 65,534 | 4.56 | % | 6,221,249 | 73,930 | 4.71 | % | 6,699,312 | 80,287 | 4.75 | % | |||||||||||||||||||||
Securities | 952,966 | 7,820 | 3.30 | % | 833,726 | 7,812 | 3.72 | % | 1,105,499 | 10,024 | 3.60 | % | |||||||||||||||||||||
Other interest-earning assets | 297,444 | 1,360 | 1.84 | % | 330,950 | 1,960 | 2.35 | % | 362,613 | 2,346 | 2.57 | % | |||||||||||||||||||||
Total interest-earning assets | 7,031,220 | 74,714 | 4.27 | % | 7,385,925 | 83,702 | 4.50 | % | 8,167,424 | 92,657 | 4.50 | % | |||||||||||||||||||||
Allowance for loan losses | (60,470 | ) | (61,642 | ) | (55,976 | ) | |||||||||||||||||||||||||||
BOLI and noninterest earning assets | 592,192 | 630,308 | 584,190 | ||||||||||||||||||||||||||||||
Total assets | $ | 7,562,942 | $ | 7,954,591 | $ | 8,695,638 | |||||||||||||||||||||||||||
Interest-bearing liabilities | |||||||||||||||||||||||||||||||||
Savings | $ | 890,830 | $ | 3,296 | 1.49 | % | $ | 981,346 | $ | 3,889 | 1.57 | % | $ | 1,055,086 | $ | 4,722 | 1.78 | % | |||||||||||||||
Interest-bearing checking | 1,520,922 | 3,728 | 0.99 | % | 1,546,322 | 4,234 | 1.09 | % | 1,511,432 | 4,483 | 1.18 | % | |||||||||||||||||||||
Money market | 608,926 | 1,760 | 1.16 | % | 743,695 | 2,593 | 1.38 | % | 755,114 | 3,093 | 1.63 | % | |||||||||||||||||||||
Certificates of deposit | 1,151,518 | 5,827 | 2.04 | % | 1,332,911 | 7,531 | 2.24 | % | 1,750,970 | 10,513 | 2.38 | % | |||||||||||||||||||||
Total interest-bearing deposits | 4,172,196 | 14,611 | 1.41 | % | 4,604,274 | 18,247 | 1.57 | % | 5,072,602 | 22,811 | 1.78 | % | |||||||||||||||||||||
FHLB advances | 1,039,055 | 5,883 | 2.28 | % | 1,020,478 | 6,396 | 2.49 | % | 1,333,739 | 8,519 | 2.53 | % | |||||||||||||||||||||
Securities sold under repurchase agreements | — | — | — | % | 2,223 | 15 | 2.68 | % | 1,922 | 13 | 2.68 | % | |||||||||||||||||||||
Long-term debt and other interest-bearing liabilities | 174,056 | 2,359 | 5.45 | % | 174,092 | 2,384 | 5.43 | % | 174,111 | 2,399 | 5.47 | % | |||||||||||||||||||||
Total interest-bearing liabilities | 5,385,307 | 22,853 | 1.71 | % | 5,801,067 | 27,042 | 1.85 | % | 6,582,374 | 33,742 | 2.03 | % | |||||||||||||||||||||
Noninterest-bearing deposits | 1,133,306 | 1,108,077 | 1,047,858 | ||||||||||||||||||||||||||||||
Noninterest-bearing liabilities | 128,282 | 132,698 | 103,667 | ||||||||||||||||||||||||||||||
Total liabilities | 6,646,895 | 7,041,842 | 7,733,899 | ||||||||||||||||||||||||||||||
Total stockholders’ equity | 916,047 | 912,749 | 961,739 | ||||||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 7,562,942 | $ | 7,954,591 | $ | 8,695,638 | |||||||||||||||||||||||||||
Net interest income/spread | $ | 51,861 | 2.56 | % | $ | 56,660 | 2.65 | % | $ | 58,915 | 2.47 | % | |||||||||||||||||||||
Net interest margin | 2.97 | % | 3.04 | % | 2.86 | % | |||||||||||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | 130.56 | % | 127.32 | % | 124.08 | % | |||||||||||||||||||||||||||
Total deposits | $ | 5,305,502 | $ | 14,611 | 1.11 | % | $ | 5,712,351 | $ | 18,247 | 1.27 | % | $ | 6,120,460 | $ | 22,811 | 1.48 | % | |||||||||||||||
Total funding (1) | $ | 6,518,613 | $ | 22,853 | 1.41 | % | $ | 6,909,144 | $ | 27,042 | 1.55 | % | $ | 7,630,232 | $ | 33,742 | 1.75 | % | |||||||||||||||
(1) | Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding. |
Three Months Ended | ||||||||||||||||||||||
June 30, 2019 | March 31, 2019 | |||||||||||||||||||||
Average | Yield | Average | Yield | |||||||||||||||||||
Balance | Interest | / Cost | Balance | Interest | / Cost | |||||||||||||||||
Interest earning assets | ||||||||||||||||||||||
Loans held-for-sale | $ | 47,233 | $ | 265 | 2.25 | % | $ | 31,374 | $ | 228 | 2.95 | % | ||||||||||
SFR mortgage | 2,059,704 | 21,390 | 4.17 | % | 2,312,900 | 24,062 | 4.22 | % | ||||||||||||||
Commercial real estate, multifamily, and construction | 3,406,672 | 39,659 | 4.67 | % | 3,387,698 | 38,117 | 4.56 | % | ||||||||||||||
Commercial and industrial, SBA, and lease financing | 1,872,289 | 26,940 | 5.77 | % | 1,920,221 | 27,235 | 5.75 | % | ||||||||||||||
Other consumer | 59,806 | 905 | 6.07 | % | 62,558 | 916 | 5.94 | % | ||||||||||||||
Gross loans and leases | 7,445,704 | 89,159 | 4.80 | % | 7,714,751 | 90,558 | 4.76 | % | ||||||||||||||
Securities | 1,304,876 | 12,457 | 3.83 | % | 1,751,509 | 17,841 | 4.13 | % | ||||||||||||||
Other interest-earning assets | 342,908 | 2,424 | 2.84 | % | 321,823 | 2,313 | 2.91 | % | ||||||||||||||
Total interest-earning assets | 9,093,488 | 104,040 | 4.59 | % | 9,788,083 | 110,712 | 4.59 | % | ||||||||||||||
Allowance for loan losses | (63,046 | ) | (61,924 | ) | ||||||||||||||||||
BOLI and non-interest earning assets | 580,133 | 575,558 | ||||||||||||||||||||
Total assets | $ | 9,610,575 | $ | 10,301,717 | ||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||
Savings | 1,083,571 | 4,950 | 1.83 | % | 1,201,802 | 5,480 | 1.85 | % | ||||||||||||||
Interest-bearing checking | 1,580,165 | 4,554 | 1.16 | % | 1,554,846 | 4,525 | 1.18 | % | ||||||||||||||
Money market | 853,007 | 3,902 | 1.83 | % | 887,538 | 4,128 | 1.89 | % | ||||||||||||||
Certificates of deposit | 2,537,060 | 15,192 | 2.40 | % | 2,982,980 | 17,310 | 2.35 | % | ||||||||||||||
Total interest-bearing deposits | 6,053,803 | 28,598 | 1.89 | % | 6,627,166 | 31,443 | 1.92 | % | ||||||||||||||
FHLB advances | 1,287,121 | 8,289 | 2.58 | % | 1,422,100 | 9,081 | 2.59 | % | ||||||||||||||
Securities sold under repurchase agreements | 2,173 | 16 | 2.95 | % | 2,350 | 18 | 3.11 | % | ||||||||||||||
Long-term debt and other interest-bearing liabilities | 174,161 | 2,357 | 5.43 | % | 174,230 | 2,362 | 5.50 | % | ||||||||||||||
Total interest-bearing liabilities | 7,517,258 | 39,260 | 2.09 | % | 8,225,846 | 42,904 | 2.12 | % | ||||||||||||||
Noninterest-bearing deposits | 1,034,205 | 1,021,741 | ||||||||||||||||||||
Non-interest-bearing liabilities | 96,179 | 97,426 | ||||||||||||||||||||
Total liabilities | 8,647,642 | 9,345,013 | ||||||||||||||||||||
Total stockholders’ equity | 962,933 | 956,704 | ||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 9,610,575 | $ | 10,301,717 | ||||||||||||||||||
Net interest income/spread | $ | 64,780 | 2.50 | % | $ | 67,808 | 2.47 | % | ||||||||||||||
Net interest margin | 2.86 | % | 2.81 | % | ||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | 120.97 | % | 118.99 | % | ||||||||||||||||||
Total deposits | $ | 7,088,008 | $ | 28,598 | 1.62 | % | $ | 7,648,907 | $ | 31,443 | 1.67 | % | ||||||||||
Total funding (1) | $ | 8,551,463 | $ | 39,260 | 1.84 | % | $ | 9,247,587 | $ | 42,904 | 1.88 | % | ||||||||||
(1) | Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding. |
Banc of California, Inc.
Consolidated Operations
Non-GAAP Measures
(Dollars in thousands, except per share data)
(Unaudited)
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.
Return on average tangible common equity and efficiency ratio, as adjusted, tangible common equity, tangible common equity to tangible assets, and tangible common equity per common share 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 common equity is calculated by subtracting preferred stock, goodwill, and other intangible assets from stockholders' equity. Tangible assets is calculated by subtracting goodwill and other intangible assets from total assets. Banking regulators also exclude goodwill and other intangible assets from stockholders' equity when assessing the capital adequacy of a financial institution.
Adjusted efficiency ratio is calculated by subtracting loss on investments in alternative energy partnerships from noninterest expense and adding total pre-tax return, which includes the loss on investments in alternative energy partnerships, to the sum of net interest income and noninterest income (total revenue). 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 final 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.
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||
Tangible common equity, and tangible common equity to tangible assets ratio | ||||||||||||||||||||
Total assets | $ | 7,662,607 | $ | 7,828,410 | $ | 8,625,337 | $ | 9,359,931 | $ | 9,886,525 | ||||||||||
Less goodwill | (37,144 | ) | (37,144 | ) | (37,144 | ) | (37,144 | ) | (37,144 | ) | ||||||||||
Less other intangible assets | (3,722 | ) | (4,151 | ) | (4,605 | ) | (5,105 | ) | (5,726 | ) | ||||||||||
Tangible assets(1) | $ | 7,621,741 | $ | 7,787,115 | $ | 8,583,588 | $ | 9,317,682 | $ | 9,843,655 | ||||||||||
Total stockholders' equity | $ | 835,002 | $ | 907,245 | $ | 900,988 | $ | 963,544 | $ | 948,325 | ||||||||||
Less goodwill | (37,144 | ) | (37,144 | ) | (37,144 | ) | (37,144 | ) | (37,144 | ) | ||||||||||
Less other intangible assets | (3,722 | ) | (4,151 | ) | (4,605 | ) | (5,105 | ) | (5,726 | ) | ||||||||||
Tangible equity(1) | 794,136 | 865,950 | 859,239 | 921,295 | 905,455 | |||||||||||||||
Less preferred stock | (187,687 | ) | (189,825 | ) | (189,825 | ) | (231,128 | ) | (231,128 | ) | ||||||||||
Tangible common equity(1) | $ | 606,449 | $ | 676,125 | $ | 669,414 | $ | 690,167 | $ | 674,327 | ||||||||||
Total stockholders' equity to total assets | 10.90 | % | 11.59 | % | 10.45 | % | 10.29 | % | 9.59 | % | ||||||||||
Tangible equity to tangible assets(1) | 10.42 | % | 11.12 | % | 10.01 | % | 9.89 | % | 9.20 | % | ||||||||||
Tangible common equity to tangible assets(1) | 7.96 | % | 8.68 | % | 7.80 | % | 7.41 | % | 6.85 | % | ||||||||||
Common shares outstanding | 49,593,077 | 50,413,681 | 50,406,763 | 50,397,769 | 50,315,490 | |||||||||||||||
Class B non-voting non-convertible common shares outstanding | 477,321 | 477,321 | 477,321 | 477,321 | 477,321 | |||||||||||||||
Total common shares outstanding | 50,070,398 | 50,891,002 | 50,884,084 | 50,875,090 | 50,792,811 | |||||||||||||||
Tangible common equity per common share(1) | $ | 12.11 | $ | 13.29 | $ | 13.16 | $ | 13.57 | $ | 13.28 | ||||||||||
Book value per common share | $ | 12.93 | $ | 14.10 | $ | 13.98 | $ | 14.40 | $ | 14.12 | ||||||||||
(1) | Non-GAAP measure. |
Banc of California, Inc. | ||||||||||||||||||||||
Consolidated Operations | ||||||||||||||||||||||
Non-GAAP Measures, Continued | ||||||||||||||||||||||
(Dollars in thousands, except per share data) | ||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||||
Return on tangible common equity | ||||||||||||||||||||||
Average total stockholders' equity | $ | 916,047 | $ | 912,749 | $ | 961,739 | $ | 962,933 | $ | 956,700 | ||||||||||||
Less average preferred stock | (189,607 | ) | (189,824 | ) | (213,619 | ) | (231,128 | ) | (231,128 | ) | ||||||||||||
Less average goodwill | (37,144 | ) | (37,144 | ) | (37,144 | ) | (37,144 | ) | (37,144 | ) | ||||||||||||
Less average other intangible assets | (4,003 | ) | (4,441 | ) | (4,935 | ) | (5,503 | ) | (6,128 | ) | ||||||||||||
Average tangible common equity(1) | $ | 685,293 | $ | 681,340 | $ | 706,041 | $ | 689,158 | $ | 682,300 | ||||||||||||
Net (loss) income | $ | (6,593 | ) | $ | 14,272 | $ | (14,132 | ) | $ | 16,582 | $ | 7,037 | ||||||||||
Less preferred stock dividends and impact of preferred stock redemption | (3,007 | ) | (3,540 | ) | (8,496 | ) | (4,308 | ) | (4,308 | ) | ||||||||||||
Add amortization of intangible assets | 429 | 454 | 500 | 621 | 620 | |||||||||||||||||
Less tax effect on amortization and impairment of intangible assets | (90 | ) | (95 | ) | (105 | ) | (130 | ) | (130 | ) | ||||||||||||
Net (loss) income available to common stockholders(1) | $ | (9,261 | ) | $ | 11,091 | $ | (22,233 | ) | $ | 12,765 | $ | 3,219 | ||||||||||
Return on average equity | (2.89 | )% | 6.20 | % | (5.83 | )% | 6.91 | % | 2.98 | % | ||||||||||||
Return on average tangible common equity(1) | (5.44 | )% | 6.46 | % | (12.49 | )% | 7.43 | % | 1.91 | % | ||||||||||||
Statutory tax rate utilized for calculating tax effect on amortization of intangible assets | 21.00 | % | 21.00 | % | 21.00 | % | 21.00 | % | 21.00 | % | ||||||||||||
Three Months Ended | ||||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||||
Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships | ||||||||||||||||||||||
Noninterest expense | $ | 46,919 | $ | 47,483 | $ | 43,240 | $ | 43,500 | $ | 62,249 | ||||||||||||
(Loss) gain on investments in alternative energy partnerships | (1,905 | ) | (1,039 | ) | 940 | 355 | (1,950 | ) | ||||||||||||||
Adjusted noninterest expense(1) | $ | 45,014 | $ | 46,444 | $ | 44,180 | $ | 43,855 | $ | 60,299 | ||||||||||||
Net interest income | $ | 51,861 | $ | 56,660 | $ | 58,915 | $ | 64,780 | $ | 67,808 | ||||||||||||
Noninterest income | 2,061 | 4,930 | 3,181 | (2,290 | ) | 6,295 | ||||||||||||||||
Total revenue | 53,922 | 61,590 | 62,096 | 62,490 | 74,103 | |||||||||||||||||
Tax credit from investments in alternative energy partnerships | — | 1,689 | 77 | 1,680 | — | |||||||||||||||||
Deferred tax expense on investments in alternative energy partnerships | — | (177 | ) | (8 | ) | (176 | ) | — | ||||||||||||||
Tax effect on tax credit and deferred tax expense | — | 267 | 7 | 426 | — | |||||||||||||||||
(Loss) gain on investments in alternative energy partnerships | (1,905 | ) | (1,039 | ) | 940 | 355 | (1,950 | ) | ||||||||||||||
Total pre-tax adjustments for investments in alternative energy partnerships | (1,905 | ) | 740 | 1,016 | 2,285 | (1,950 | ) | |||||||||||||||
Adjusted total revenue(1) | $ | 52,017 | $ | 62,330 | $ | 63,112 | $ | 64,775 | $ | 72,153 | ||||||||||||
Efficiency ratio(1) | 87.01 | % | 77.10 | % | 69.63 | % | 69.61 | % | 84.00 | % | ||||||||||||
Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships(1) | 86.54 | % | 74.51 | % | 70.00 | % | 67.70 | % | 83.57 | % | ||||||||||||
Effective tax rate utilized for calculating tax effect on tax credit and deferred tax expense | 24.03 | % | 15.00 | % | 9.36 | % | 22.07 | % | 27.00 | % | ||||||||||||
(1) | Non-GAAP measure. |
Banc of California, Inc. | ||||||||||||||||||||||||||||
Consolidated Operations | ||||||||||||||||||||||||||||
Non-GAAP Measures, Continued | ||||||||||||||||||||||||||||
(Dollars in thousands, except per share data) | ||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||||||||||
Total noninterest expense | $ | 46,919 | $ | 47,483 | $ | 43,240 | $ | 43,500 | $ | 62,249 | ||||||||||||||||||
Deductions for non-core items | ||||||||||||||||||||||||||||
Data processing | — | — | — | (797 | ) | — | ||||||||||||||||||||||
Professional fees (recoveries) | (1,678 | ) | 3,557 | 2,615 | 6,214 | (2,979 | ) | |||||||||||||||||||||
Restructuring (expense) reversal | — | (1,626 | ) | — | 158 | (2,795 | ) | |||||||||||||||||||||
Other expenses | — | — | (131 | ) | — | — | ||||||||||||||||||||||
Total non-core adjustments | (1,678 | ) | 1,931 | 2,484 | 5,575 | (5,774 | ) | |||||||||||||||||||||
(Loss) gain on investments in alternative energy partnerships | (1,905 | ) | (1,039 | ) | 940 | 355 | (1,950 | ) | ||||||||||||||||||||
Total adjustments | (3,583 | ) | 892 | 3,424 | 5,930 | (7,724 | ) | |||||||||||||||||||||
Adjusted noninterest expense(1) | $ | 43,336 | $ | 48,375 | $ | 46,664 | $ | 49,430 | $ | 54,525 | ||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
March 31,
| December 31,
| September 30,
| June 30,
| March 31,
| ||||||||||||||||||||||||
Net interest income | $ | 51,861 | $ | 56,660 | $ | 58,915 | $ | 64,780 | $ | 67,808 | ||||||||||||||||||
Non-interest income | 2,061 | 4,930 | 3,181 | (2,290 | ) | 6,295 | ||||||||||||||||||||||
Total revenue | $ | 53,922 | $ | 61,590 | $ | 62,096 | $ | 62,490 | $ | 74,103 | ||||||||||||||||||
Noninterest expense | 46,919 | 47,483 | 43,240 | 43,500 | 62,249 | |||||||||||||||||||||||
Pre-tax pre-provision income(1) | 7,003 | 14,107 | 18,856 | 18,990 | 11,854 | |||||||||||||||||||||||
Net interest income | 51,861 | 56,660 | 58,915 | 64,780 | 67,808 | |||||||||||||||||||||||
Non-interest income | 2,061 | 4,930 | 3,181 | (2,290 | ) | 6,295 | ||||||||||||||||||||||
Total revenue | 53,922 | 61,590 | 62,096 | 62,490 | 74,103 | |||||||||||||||||||||||
Noninterest expense | 46,919 | 47,483 | 43,240 | 43,500 | 62,249 | |||||||||||||||||||||||
Total non-core adjustments | (1,678 | ) | 1,931 | 2,484 | 5,575 | (5,774 | ) | |||||||||||||||||||||
Noninterest expense after non-core adjustments | 45,241 | 49,414 | 45,724 | 49,075 | 56,475 | |||||||||||||||||||||||
(Loss) gain on investment in alternative energy partnerships | $ | (1,905 | ) | $ | (1,039 | ) | $ | 940 | $ | 355 | $ | (1,950 | ) | |||||||||||||||
Adjusted noninterest expense(1) | $ | 43,336 | $ | 48,375 | $ | 46,664 | $ | 49,430 | $ | 54,525 | ||||||||||||||||||
Adjusted pre-tax pre-provision income(1) | $ | 10,586 | $ | 13,215 | $ | 15,432 | $ | 13,060 | $ | 19,578 | ||||||||||||||||||
(1) | Non-GAAP measure. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20200429005282/en/
Contacts:
Banc of California, Inc.
(855) 361-2262
Jared Wolff, (949) 385-8700
Lynn Hopkins, (949) 265-6599
