SANTA ANA, Calif.--(BUSINESS WIRE)--Banc of California, Inc. (NYSE: BANC) today reported a net loss for the third quarter of $22.7 million, resulting in a diluted loss per common share of $0.45.
Highlights for the third quarter (as compared to second quarter 2019) included:
- Noninterest-bearing deposits increased $114 million
- Cost of deposits decreased by 14 basis points to 1.48%
- Noninterest expense was $43.3 million
- Executed on the sale of $371 million of low-yielding and long duration mortgage-backed securities, furthering the ability to remix the investment portfolio
- Completed tender offer for $46 million of preferred stock, inclusive of premium and accrued dividends
- The total risk–based capital ratio was 14.31% and the tier 1 leverage ratio was 9.84% at the end of the quarter
- The net loss available to common stockholders for this quarter is largely the result of a $35 million charge-off, or $0.60 per diluted common share, related to a loan originated in November 2017 to a borrower that has been the purported subject of a fraudulent scheme, as previously reported by the Company on Form 8-K.
“The third quarter results reflect the continued progress and execution on our strategy to improve the foundation and earnings power of the Company for the long term, lowering deposit costs, reducing our expenses and eliminating non–core assets,” said Jared Wolff, President and Chief Executive Officer of Banc of California. “The deposit initiative we began in May has brought in over $100 million of low cost deposits. We are seeing expenses stabilize at a significantly reduced level, and have made considerable progress in right sizing our balance sheet.”
Mr. Wolff continued, “During the quarter, we also executed on specific initiatives to simplify and optimize our balance sheet and create flexibility. As a result of these efforts, we are well positioned to consider additional capital management strategies in the coming quarters. Despite the significant loss we reported during the quarter from the borrower fraud that resulted in a charge–off of the loan originated in 2017, we continue to maintain strict credit quality standards which are in line with our relationship-lending focus. Overall, we remain well positioned on both sides of the balance sheet in the current environment, with opportunity to further reduce our cost of deposits and to remix our loan portfolio to protect yield as we build out our focused business banking and bridge lending platforms. I’m pleased to see the progress the bank made during this past quarter and look forward to continued execution as we close out 2019.”
Speaking specifically about balance sheet activity for the quarter, John Bogler, Chief Financial Officer of Banc of California, said, “We continue to make great strides in building a core balance sheet that will allow us to be high performing. During the quarter, we sold $574 million of low coupon multifamily loans, repaid high cost brokered deposits, tendered for $46 million of high cost preferred equity and we took the opportunity to sell longer duration, low yielding mortgage–backed securities at the end of the quarter. This will allow us to start the process of remaking the securities portfolio. All of these actions will begin to translate into a higher performing balance sheet as we head into next year.”
Business Results - Income Statement Highlights
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|
September 30,
|
|
September 30,
|
||||||||||||||
Total interest and dividend income |
$ |
92,657 |
|
|
$ |
104,040 |
|
|
$ |
110,712 |
|
|
$ |
111,130 |
|
|
$ |
107,774 |
|
|
$ |
307,409 |
|
|
$ |
311,666 |
|
Total interest expense |
33,742 |
|
|
39,260 |
|
|
42,904 |
|
|
40,448 |
|
|
36,582 |
|
|
115,906 |
|
|
96,272 |
|
|||||||
Net interest income |
58,915 |
|
|
64,780 |
|
|
67,808 |
|
|
70,682 |
|
|
71,192 |
|
|
191,503 |
|
|
215,394 |
|
|||||||
Provision for (reversal of) loan and lease losses |
38,540 |
|
|
(1,987 |
) |
|
2,512 |
|
|
6,653 |
|
|
1,410 |
|
|
39,065 |
|
|
23,562 |
|
|||||||
Net interest income after provision for loan and lease losses |
20,375 |
|
|
66,767 |
|
|
65,296 |
|
|
64,029 |
|
|
69,782 |
|
|
152,438 |
|
|
191,832 |
|
|||||||
Total noninterest income (loss) |
3,181 |
|
|
(2,290 |
) |
|
6,295 |
|
|
2,448 |
|
|
4,824 |
|
|
7,186 |
|
|
21,467 |
|
|||||||
Total noninterest expense |
43,307 |
|
|
43,587 |
|
|
61,835 |
|
|
49,569 |
|
|
60,877 |
|
|
148,729 |
|
|
183,216 |
|
|||||||
Income tax (benefit) expense |
(5,619 |
) |
|
4,308 |
|
|
2,719 |
|
|
6,117 |
|
|
3,301 |
|
|
1,408 |
|
|
(1,273 |
) |
|||||||
(Loss) income from continuing operations |
(14,132 |
) |
|
16,582 |
|
|
7,037 |
|
|
10,791 |
|
|
10,428 |
|
|
9,487 |
|
|
31,356 |
|
|||||||
Income from discontinued operations |
— |
|
|
— |
|
|
— |
|
|
247 |
|
|
668 |
|
|
— |
|
|
3,078 |
|
|||||||
Net (loss) income |
$ |
(14,132 |
) |
|
$ |
16,582 |
|
|
$ |
7,037 |
|
|
$ |
11,038 |
|
|
$ |
11,096 |
|
|
$ |
9,487 |
|
|
$ |
34,434 |
|
Net interest income
Q3 2019 vs Q2 2019.
Net interest income for the third quarter decreased to $58.9 million as we sold non-core assets and repaid high cost funding liabilities during the quarter. For the third quarter, average interest-earning assets declined from the prior quarter by $926 million to $8.2 billion, while the net interest margin remained flat at 2.86% between quarters. We continue to execute on our strategy of disposing of lower yielding, non-core assets and rebalancing our portfolio.
Our average yield on interest-earning assets declined to 4.50% for the third quarter as compared to 4.59% for the second quarter of 2019, primarily attributable to a decrease in our average yield on loans and securities. Our average yield on loans came in at 4.75% for the third quarter which decreased by 5 basis points from the prior quarter, primarily attributable to variable rate loans repricing and lower average balance of higher yielding commercial and industrial loans, partially offset by the settlement of the Freddie Mac multifamily securitization which consisted of lower yielding loans. Our average yield on securities decreased 23 basis points primarily as a result of the quarterly interest rate resets on our collateralized loan obligations (“CLO”) and the sales of CLOs that occurred during the second quarter of 2019. We sold a significant amount of CLOs during the second quarter, with the full impact of the second quarter sales reflected in the third quarter.
Our average cost of interest-bearing liabilities decreased to 2.03% for the third quarter from 2.09% for the second quarter, primarily resulting from a 14 basis point decrease in our average cost of total deposits from the prior quarter to 1.48%. Non-interest bearing deposits increased by $114 million in the third quarter. The decrease in our cost of deposits from the prior quarter primarily resulted from the continued execution of our deposit strategy to focus on relationship-based clients and de-emphasize high-rate transactional customers and brokered certificates of deposit.
YTD 2019 vs YTD 2018.
Net interest income for the nine months ended September 30, 2019 decreased to $191.5 million as compared to $215.4 million for the same period in 2018 primarily as a result of the sale of CLOs in 2019 and the overall higher cost of funding, both mostly offset by higher yields on assets driven by the higher interest rate environment and loan growth in almost all loan categories. For the nine months ended September 30, 2019, average interest-earning assets declined $699 million from the prior period to $9.01 billion, while the net interest margin decreased to 2.84% from 2.97% for the comparable 2018 period.
Our average yield on interest-earning assets increased 26 basis points to 4.56% for the nine months ended September 30, 2019 as compared to 4.30% for the comparable 2018 period, due to increased yields in the loan and securities portfolios as well as an increased mix of loans versus securities. Our average yield on loans came in at 4.77% for the nine months ended September 30, 2019, compared to 4.61% during the comparable 2018 period, primarily attributable to overall increases in market rates between periods. Our average yield on securities increased 22 basis points primarily as a result of an interest rate reset on our CLOs, partially offset by a decrease in our average balance attributable to the sale and calls of $682.6 million of our higher yielding CLOs between periods.
Provision for loan losses
Q3 2019 vs Q2 2019.
During the third quarter, we recognized a loan loss provision of $38.5 million. As previously reported, the loan loss provision was primarily attributable to a $35 million charge-off of a line of credit originated in November 2017 to a borrower purportedly the subject of a fraudulent scheme. In addition, the charge-off increased the loss factor used in our allowance for loan loss methodology for commercial and industrial loans, resulting in an additional loan loss provision of $3.0 million. We are actively evaluating all available sources of recovery, although no assurance can be given that we will be successful in that regard.
During the third quarter of 2019, the Company undertook an extensive collateral review of all lending relationships $5 million and above not secured by real estate, consisting of 53 loans representing $536 million in commitments. The collateral review focused on security and collateral documentation and confirmation of the bank's collateral interest. The review was performed within the bank's Internal Audit division and the work was validated by an independent third party. While the review and outside validation is not yet complete, to date, we have not identified any other instances of apparent fraud for the credits reviewed or concerns over the existence of collateral held by the bank or on our behalf at third parties; however, there are no assurances that our internal review and third party validation will be sufficient to identify all such issues.
YTD 2019 vs YTD 2018.
During the nine months ended September 30, 2019 we recognized a loan loss provision of $39.1 million, primarily attributable to the aforementioned $35 million charge-off of a line of credit. For the comparable prior year period, $23.6 million of loan loss provisions were recorded, inclusive of a $14 million charge-off related to borrower fraud, as well as $594 million of growth in the loan portfolio.
Noninterest income
Q3 2019 vs Q2 2019.
Noninterest income for the third quarter was $3.2 million, which represented an increase of $5.5 million, or 239% from the prior quarter. The increase was primarily due to (1) $9.6 million primarily resulting from the net impact of the hedge associated with the Freddie Mac multifamily securitization, (2) a $5.1 million realized net loss on the sale of mortgage backed securities (“MBS”), (3) a $1.5 million increase in gain on sale of loans and (4) a $731 thousand other-than-temporary impairment on the remaining MBS portfolio.
In August 2019, the Company completed the previously announced Freddie Mac securitization of $574 million multifamily loans that were held for sale as of June 30, 2019 and sold the associated mortgage servicing rights. The Company realized a gain in fair value of the loans sold into the securitization of $9.0 million, offset by a $9.6 million loss from interest rate swap agreements entered into in order to offset variability in the fair value of the securitized loans as a result of changes in market interest rates. The $9.0 million gain in fair value on the securitization was recognized during the three months ended September 30, 2019 when the securitization settled, while the corresponding loss, as previously disclosed, was recognized during the three months ended June 30, 2019 because the interest rate swap agreements were entered into during May 2019 in preparation for the securitization.
During the third quarter, the Company partially hedged the fair value of the MBS portfolio using interest rate swaps. At the end of the quarter, the Company took advantage of the decline in long-term interest rates and sold the majority of the MBS portfolio and unwound the majority of the interest rate swaps. The remaining balance of the MBS portfolio and the related interest rate swap is expected to be sold and unwound early in the fourth quarter 2019. The unsold portion of the MBS portfolio has been deemed other–than–temporarily impaired and, along with the fair value adjustment on the swap, has been recorded in noninterest income with a net impact of $731 thousand.
YTD 2019 vs YTD 2018.
Noninterest income for the nine months ended September 30, 2019 was $7.2 million, which represented a decrease of $14.3 million, or 66.5% from the comparable period in the prior year. The decrease was primarily attributable to a $10.4 million decrease in net gain on sale of investment securities as a result of decreased favorable sale activity in 2019 and a realized loss of $5.1 million on the sale of our MBS portfolio in the third quarter of 2019 and a decrease of $3.3 million in loan servicing income as a result of the sale of mortgage servicing rights in 2018.
Noninterest expense
Q3 2019 vs Q2 2019.
Noninterest expense for the third quarter was $43.3 million, which was comparable to the prior quarter. Noninterest expense included: (1) a $4.4 million increase in our professional fees, primarily attributable to $6.2 million of insurance recoveries net of expenses related to securities litigation, indemnification, investigation and other legal expenses in the second quarter as compared to $2.6 million of insurance recoveries net of expenses in the third quarter, (2) a $1.6 million decrease in our compensation expense resulting from lower headcount and lower consulting fees, (3) a $897 thousand decrease in regulatory assessments, and (4) a $585 thousand increase in gain on investments in alternative energy partnerships.
Noninterest expense for the second quarter of 2019 was $43.6 million, which included non-core adjustments of (1) $6.2 million of insurance recoveries net of expenses related to securities litigation, indemnification, investigation and other legal expenses, (2) $797 thousand of project charge-offs related to data processing, and (3) a $158 thousand reversal of restructuring expenses recognized in the first quarter of 2019.
YTD 2019 vs YTD 2018.
Noninterest expense for the nine months ended September 30, 2019 was $148.7 million, which represented a decrease of $34.5 million, or 18.8% from the comparable period in the prior year. The decrease in noninterest expense consisted of: (1) a decrease of $17.8 million in professional fees, primarily attributable to $6.1 million of insurance recoveries net of expenses related to securities litigation, indemnification, investigation and other legal expenses, (2) a $3.5 million decrease in our compensation expense resulting from lower headcount and lower consulting fees, (3) a $3.1 million decrease in advertising costs, and (4) a $3.6 million decrease in loss on investments in alternative energy partnerships.
Income taxes
Q3 2019 vs Q2 2019.
Income tax benefit totaled $5.6 million for the quarter, representing a decrease of 230% from the prior quarter, and an effective tax rate of 28.45%. During the third quarter of 2019, we had a pre-tax net loss of $19.8 million, resulting in approximately 13% reduction in the projected annual effective tax rate. For the full year, we expect our tax rate to normalize closer to 11%. The lower effective tax rate of 11% is primarily driven by the loss the Company incurred and we expect the rate to normalize closer to 20% in 2020.
YTD 2019 vs YTD 2018.
Income tax expense totaled $1.4 million for the nine months ended September 30, 2019, representing an increase of $1.5 million from the same period in 2018, and an effective tax rate of 11.91%. The increase in income tax expense and effective tax rate for the nine months ended September 30, 2019, primarily relates to the significant reduction in tax credits received by the Company on investments in alternative energy partnerships.
Balance Sheet
The following table shows selected balance sheet line items as of September 30, 2019 and for the previous four quarters. As indicated in the table below, at September 30, 2019, total assets were approximately $8.6 billion, which represented a linked quarter decrease of $735 million, consistent with our strategic shift towards reducing our balance sheet and focusing on relationship lending.
|
As of and for the Three Months Ended |
|
Amount Change |
||||||||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|
Q3-19 vs. Q2-
|
|
Q3-19 vs. Q3-
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total assets |
$ |
8,625,337 |
|
|
$ |
9,359,931 |
|
|
$ |
9,886,525 |
|
|
$ |
10,630,067 |
|
|
$ |
10,260,822 |
|
|
$ |
(734,594 |
) |
|
$ |
(1,635,485 |
) |
Securities available-for-sale |
$ |
775,662 |
|
|
$ |
1,167,687 |
|
|
$ |
1,471,303 |
|
|
$ |
1,992,500 |
|
|
$ |
2,059,832 |
|
|
$ |
(392,025 |
) |
|
$ |
(1,284,170 |
) |
Loans held-for-investment |
$ |
6,383,259 |
|
|
$ |
6,719,570 |
|
|
$ |
7,557,200 |
|
|
$ |
7,700,873 |
|
|
$ |
7,253,293 |
|
|
$ |
(336,311 |
) |
|
$ |
(870,034 |
) |
Loans held-for-sale |
$ |
23,936 |
|
|
$ |
597,720 |
|
|
$ |
25,191 |
|
|
$ |
8,116 |
|
|
$ |
9,382 |
|
|
$ |
(573,784 |
) |
|
$ |
14,554 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Demand deposits |
$ |
2,602,011 |
|
|
$ |
2,510,233 |
|
|
$ |
2,690,738 |
|
|
$ |
2,579,770 |
|
|
$ |
2,775,347 |
|
|
$ |
91,778 |
|
|
$ |
(173,336 |
) |
Other core deposits |
3,074,936 |
|
|
3,301,080 |
|
|
3,575,140 |
|
|
3,793,605 |
|
|
3,638,624 |
|
|
(226,144 |
) |
|
(563,688 |
) |
|||||||
Brokered deposits |
93,111 |
|
|
480,977 |
|
|
1,459,054 |
|
|
1,543,269 |
|
|
987,771 |
|
|
(387,866 |
) |
|
(894,660 |
) |
|||||||
Total Deposits |
$ |
5,770,058 |
|
|
$ |
6,292,290 |
|
|
$ |
7,724,932 |
|
|
$ |
7,916,644 |
|
|
$ |
7,401,742 |
|
|
$ |
(522,232 |
) |
|
$ |
(1,631,684 |
) |
As percentage of total deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Demand deposits |
45.10 |
% |
|
39.89 |
% |
|
34.83 |
% |
|
32.59 |
% |
|
37.50 |
% |
|
5.21 |
% |
|
7.60 |
% |
|||||||
Other core deposits |
53.29 |
% |
|
52.46 |
% |
|
46.28 |
% |
|
47.92 |
% |
|
49.16 |
% |
|
0.83 |
% |
|
4.13 |
% |
|||||||
Brokered deposits |
1.61 |
% |
|
7.64 |
% |
|
18.89 |
% |
|
19.49 |
% |
|
13.35 |
% |
|
(6.03 |
)% |
|
(11.74 |
)% |
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average Loan Yield |
4.75 |
% |
|
4.80 |
% |
|
4.76 |
% |
|
4.74 |
% |
|
4.70 |
% |
|
(0.05 |
)% |
|
0.05 |
% |
|||||||
Average Cost of Interest-Bearing Deposits |
1.78 |
% |
|
1.89 |
% |
|
1.92 |
% |
|
1.77 |
% |
|
1.58 |
% |
|
(0.11 |
)% |
|
0.20 |
% |
|||||||
Investments
Securities available-for-sale declined to $775.7 million, a decrease of 33.6% from the previous quarter, primarily due to the sale of $371 million of our MBS portfolio (resulting in a $5.1 million realized loss). In addition, $731 thousand of other-than-temporary impairment was recognized on the remaining $40 million MBS portfolio. As of September 30, 2019, our securities balance included $735 million of CLOs, $40 million of agency residential MBS and $277 thousand of non-agency residential MBS. The remaining balance of MBS are expected to be sold in the fourth quarter with all of the MBS sale proceeds expected to be reinvested into a mix of security classes, resulting in an overall shorter duration for the portfolio.
Loans
The following table sets forth the composition, by loan category, of our loan portfolio at September 30, 2019 and the previous four quarters.
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
Composition of held-for-investment loans |
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate |
$ |
891,029 |
|
|
$ |
856,497 |
|
|
$ |
865,521 |
|
|
$ |
867,013 |
|
|
$ |
823,193 |
|
Multifamily |
1,563,757 |
|
|
1,598,978 |
|
|
2,332,527 |
|
|
2,241,246 |
|
|
2,112,190 |
|
|||||
Construction |
228,561 |
|
|
209,029 |
|
|
211,549 |
|
|
203,976 |
|
|
200,294 |
|
|||||
Commercial and industrial |
1,789,478 |
|
|
1,951,707 |
|
|
1,907,102 |
|
|
1,944,142 |
|
|
1,673,055 |
|
|||||
SBA |
75,359 |
|
|
80,929 |
|
|
74,998 |
|
|
68,741 |
|
|
71,494 |
|
|||||
Total commercial loans |
4,548,184 |
|
|
4,697,140 |
|
|
5,391,697 |
|
|
5,325,118 |
|
|
4,880,226 |
|
|||||
Single family residential mortgage |
1,775,953 |
|
|
1,961,065 |
|
|
2,102,694 |
|
|
2,305,490 |
|
|
2,300,069 |
|
|||||
Other consumer |
59,122 |
|
|
61,365 |
|
|
62,809 |
|
|
70,265 |
|
|
72,998 |
|
|||||
Total consumer loans |
1,835,075 |
|
|
2,022,430 |
|
|
2,165,503 |
|
|
2,375,755 |
|
|
2,373,067 |
|
|||||
Total gross loans |
$ |
6,383,259 |
|
|
$ |
6,719,570 |
|
|
$ |
7,557,200 |
|
|
$ |
7,700,873 |
|
|
$ |
7,253,293 |
|
Composition percentage of held-for-investment loans |
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate |
14.0 |
% |
|
12.7 |
% |
|
11.5 |
% |
|
11.3 |
% |
|
11.3 |
% |
|||||
Multifamily |
24.5 |
% |
|
23.8 |
% |
|
30.9 |
% |
|
29.2 |
% |
|
29.1 |
% |
|||||
Construction |
3.6 |
% |
|
3.1 |
% |
|
2.8 |
% |
|
2.6 |
% |
|
2.8 |
% |
|||||
Commercial and industrial |
28.0 |
% |
|
29.1 |
% |
|
25.2 |
% |
|
25.2 |
% |
|
23.1 |
% |
|||||
SBA |
1.2 |
% |
|
1.2 |
% |
|
1.0 |
% |
|
0.9 |
% |
|
1.0 |
% |
|||||
Total commercial loans |
71.3 |
% |
|
69.9 |
% |
|
71.4 |
% |
|
69.2 |
% |
|
67.3 |
% |
|||||
Single family residential mortgage |
27.8 |
% |
|
29.2 |
% |
|
27.8 |
% |
|
29.9 |
% |
|
31.7 |
% |
|||||
Other consumer |
0.9 |
% |
|
0.9 |
% |
|
0.8 |
% |
|
0.9 |
% |
|
1.0 |
% |
|||||
Total consumer loans |
28.7 |
% |
|
30.1 |
% |
|
28.6 |
% |
|
30.8 |
% |
|
32.7 |
% |
|||||
Total gross loans |
100.0 |
% |
|
100.0 |
% |
|
100.0 |
% |
|
100.0 |
% |
|
100.0 |
% |
|||||
Held-for-investment loans decreased to $6.4 billion driven mostly by a reduction of $220 million related to the payoff of single family residential mortgage loans and multifamily loans while simultaneously reducing new commitments and a $162 million decrease in commercial and industrial loans due primarily to credit-related exits and charge-offs and a decrease in the warehouse lending balance, partially offset by a net increase of $54 million in commercial real estate and construction loans.
Single family residential mortgage and multifamily loans now comprise 52.3% of the total held-for-investment loan portfolio as compared to 60.8% one year ago. The loan portfolio concentration of single family residential mortgage and multifamily is expected to decline over the coming quarters as part of our strategy to deemphasize transaction lending and focus on relationship based clients. Commercial real estate loans comprised 14.0% of the loan portfolio and commercial and industrial loans constituted 28.0%, with yields of 4.87% and 5.38%, respectively.
Held-for-sale loans decreased by $574 million primarily resulting from the completion of the Freddie Mac multifamily securitization during the third quarter of 2019. The loans sold had a weighted average coupon of 3.79% and the proceeds were used to repay overnight Federal Home Loan Bank (“FHLB”) advances, which at the time had an advance rate of 2.53%.
During the third quarter of 2019, our commercial and industrial loan new commitments were $239 million, which represented an increase of 28.5% over the prior quarter. The following table sets forth our new commitments by loan category (in millions), and the related weighted average coupon, during the third quarter of 2019.
|
Three Months Ended |
||||||||||||
|
September 30, 2019 |
|
June 30, 2019 |
||||||||||
|
New Loan Commitments |
|
Weighted Average Coupon |
|
New Loan Commitments |
|
Weighted Average Coupon |
||||||
Commercial real estate |
$ |
64.0 |
|
4.61% |
|
$ |
72.6 |
|
4.79% |
||||
Multifamily |
86.8 |
|
4.30% |
|
172.3 |
|
4.62% |
||||||
Construction |
29.0 |
|
6.54% |
|
21.0 |
|
6.49% |
||||||
Commercial and industrial |
239.0 |
|
5.36% |
|
185.7 |
|
6.07% |
||||||
SBA |
3.4 |
|
4.74% |
|
18.6 |
|
5.13% |
||||||
Single family residential mortgage |
2.4 |
|
4.30% |
|
128.4 |
|
4.95% |
||||||
Other consumer |
1.7 |
|
5.99% |
|
0.4 |
|
6.65% |
||||||
Total |
$ |
426.3 |
|
5.10% |
|
$ |
599.0 |
|
5.25% |
||||
Deposits
The following table sets forth the composition of our deposits at September 30, 2019 and the previous four quarters.
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
Composition of deposits |
|
|
|
|
|
|
|
|
|
||||||||||
Noninterest-bearing checking |
$ |
1,107,442 |
|
|
$ |
993,745 |
|
|
$ |
1,120,700 |
|
|
$ |
1,023,360 |
|
|
$ |
1,061,557 |
|
Interest-bearing checking |
1,503,208 |
|
|
1,577,901 |
|
|
1,573,499 |
|
|
1,556,410 |
|
|
1,713,790 |
|
|||||
Money market |
695,530 |
|
|
800,898 |
|
|
899,330 |
|
|
873,153 |
|
|
856,886 |
|
|||||
Savings |
1,042,162 |
|
|
1,061,115 |
|
|
1,151,442 |
|
|
1,265,847 |
|
|
1,269,489 |
|
|||||
Non-brokered certificates of deposit |
1,367,284 |
|
|
1,479,137 |
|
|
1,684,895 |
|
|
1,654,605 |
|
|
1,512,249 |
|
|||||
Brokered certificates of deposit |
54,432 |
|
|
379,494 |
|
|
1,295,066 |
|
|
1,543,269 |
|
|
987,771 |
|
|||||
Total deposits |
$ |
5,770,058 |
|
|
$ |
6,292,290 |
|
|
$ |
7,724,932 |
|
|
$ |
7,916,644 |
|
|
$ |
7,401,742 |
|
Composition percentage of deposits |
|
|
|
|
|
|
|
|
|
||||||||||
Noninterest-bearing checking |
19.2 |
% |
|
15.8 |
% |
|
14.5 |
% |
|
12.9 |
% |
|
14.3 |
% |
|||||
Interest-bearing checking |
26.1 |
% |
|
25.1 |
% |
|
20.4 |
% |
|
19.7 |
% |
|
23.2 |
% |
|||||
Money market |
12.0 |
% |
|
12.7 |
% |
|
11.6 |
% |
|
11.0 |
% |
|
11.6 |
% |
|||||
Savings |
18.1 |
% |
|
16.9 |
% |
|
14.9 |
% |
|
16.0 |
% |
|
17.2 |
% |
|||||
Non-brokered certificates of deposit |
23.7 |
% |
|
23.5 |
% |
|
21.8 |
% |
|
20.9 |
% |
|
20.4 |
% |
|||||
Brokered certificates of deposit |
0.9 |
% |
|
6.0 |
% |
|
16.8 |
% |
|
19.5 |
% |
|
13.3 |
% |
|||||
Total deposits |
100.0 |
% |
|
100.0 |
% |
|
100.0 |
% |
|
100.0 |
% |
|
100.0 |
% |
|||||
Deposits finished the third quarter at $5.8 billion, with noninterest-bearing deposits increasing $114 million from the prior quarter. For the third quarter, the average balance of noninterest-bearing deposits was $1.048 billion, up from the second quarter average balance of $1.034 billion and noninterest-bearing deposits now comprise 19.2% of total deposits, up from 14.3% from the comparable period in the prior year. Total deposits decreased by $522 million, of which $325 million was as a result of maturities on our brokered certificates of deposit and no new brokered certificates of deposit were acquired during the quarter. Non–brokered certificates of deposit declined by $112 million from the prior quarter and are expected to continue to decline as offered rates on maturing certificates are reset lower. Money market balances decreased by $105 million versus the prior quarter, while savings account balances decreased by $19 million during this same time period. We continue to price down higher costing savings and money market accounts as we focus on building relationship based deposits.
Debt
Advances from the FHLB decreased $175 million, or 10%, to $1.65 billion as of September 30, 2019, as a result of the paydown of overnight advances with the FHLB using the proceeds from the sale of loans sold into the Freddie Mac multifamily securitization. At the end of the quarter, the maturity dates of FHLB advances consisted of $670 million of overnight, $300 million maturing in 3 months or less, and $680 million maturing beyond 3 months. As of the end of the quarter, the overnight advance interest rate was 2.08%.
Equity
At September 30, 2019, total stockholders’ equity decreased by $62.6 million to $901.0 million on a linked-quarter basis, while tangible common equity decreased by $20.8 million to $669.4 million. The decrease in total stockholders’ equity partially related to our net loss of $14.1 million, partially offset by the improvement within our accumulated other comprehensive income as a result of other comprehensive income of $3.1 million. During the quarter, the Company completed a tender offer for depositary shares representing shares of its Series D and Series E preferred stock. The total consideration for each Series E Depositary Share tendered and accepted for purchase pursuant to the offer equaled $27.13. The total consideration for each Series D Depositary Share tendered and accepted for purchase pursuant to the offer equaled $26.39. The aggregate total consideration payable by the Company for the preferred stock accepted for purchase was $46.0 million inclusive of premium to par and accrued dividends ($19.4 million of series D and $26.6 million series E depository shares). The tender resulted in a $5.1 million reduction to net income available to common shareholders.
Capital ratios remain strong with total risk based capital at 14.31% and a tier 1 leverage ratio of 9.84%. The following table sets forth our regulatory capital ratios at September 30, 2019 and the previous four quarters.
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|||||
Capital Ratios |
|
|
|
|
|
|
|
|
|
|||||
Banc of California, Inc. |
|
|
|
|
|
|
|
|
|
|||||
Total risk-based capital ratio |
14.31 |
% |
|
15.00 |
% |
|
14.01 |
% |
|
13.71 |
% |
|
14.05 |
% |
Tier 1 risk-based capital ratio |
13.26 |
% |
|
14.03 |
% |
|
13.03 |
% |
|
12.77 |
% |
|
13.15 |
% |
Common equity tier 1 capital ratio |
10.30 |
% |
|
10.50 |
% |
|
9.72 |
% |
|
9.53 |
% |
|
9.80 |
% |
Tier 1 leverage ratio |
9.84 |
% |
|
9.62 |
% |
|
8.87 |
% |
|
8.95 |
% |
|
8.99 |
% |
Banc of California, NA |
|
|
|
|
|
|
|
|
|
|||||
Total risk-based capital ratio |
15.59 |
% |
|
16.70 |
% |
|
15.79 |
% |
|
15.71 |
% |
|
15.94 |
% |
Tier 1 risk-based capital ratio |
14.53 |
% |
|
15.73 |
% |
|
14.81 |
% |
|
14.77 |
% |
|
15.04 |
% |
Common equity tier 1 capital ratio |
14.53 |
% |
|
15.73 |
% |
|
14.81 |
% |
|
14.77 |
% |
|
15.04 |
% |
Tier 1 leverage ratio |
10.75 |
% |
|
10.80 |
% |
|
10.07 |
% |
|
10.36 |
% |
|
10.29 |
% |
Credit Quality
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
Asset quality information and ratios |
($ in thousands) |
||||||||||||||||||
Delinquent loans held-for-investment |
|
|
|
|
|
|
|
|
|
||||||||||
30 to 89 days delinquent |
$ |
39,122 |
|
|
$ |
34,938 |
|
|
$ |
44,840 |
|
|
$ |
26,684 |
|
|
$ |
20,265 |
|
90+ days delinquent |
17,220 |
|
|
17,272 |
|
|
14,623 |
|
|
13,846 |
|
|
15,269 |
|
|||||
Total delinquent loans |
$ |
56,342 |
|
|
$ |
52,210 |
|
|
$ |
59,463 |
|
|
$ |
40,530 |
|
|
$ |
35,534 |
|
Total delinquent loans to total loans |
0.88 |
% |
|
0.78 |
% |
|
0.79 |
% |
|
0.53 |
% |
|
0.49 |
% |
|||||
Non-performing assets, excluding loans held-for-sale |
|
|
|
|
|
|
|
|
|
||||||||||
Non-performing loans |
$ |
45,169 |
|
|
$ |
28,499 |
|
|
$ |
27,739 |
|
|
$ |
21,585 |
|
|
$ |
25,523 |
|
90+ days delinquent and still accruing loans |
— |
|
|
275 |
|
|
731 |
|
|
470 |
|
|
— |
|
|||||
Other real estate owned |
— |
|
|
276 |
|
|
316 |
|
|
672 |
|
|
434 |
|
|||||
Non-performing assets |
$ |
45,169 |
|
|
$ |
29,050 |
|
|
$ |
28,786 |
|
|
$ |
22,727 |
|
|
$ |
25,957 |
|
ALLL to non-performing loans |
139.31 |
% |
|
206.86 |
% |
|
224.40 |
% |
|
281.99 |
% |
|
226.39 |
% |
|||||
Non-performing loans to total loans held-for-investment |
0.71 |
% |
|
0.43 |
% |
|
0.38 |
% |
|
0.29 |
% |
|
0.35 |
% |
|||||
Non-performing assets to total assets |
0.52 |
% |
|
0.31 |
% |
|
0.29 |
% |
|
0.21 |
% |
|
0.25 |
% |
|||||
Troubled debt restructurings (TDRs) |
|
|
|
|
|
|
|
|
|
||||||||||
Performing TDRs |
$ |
6,800 |
|
|
$ |
20,245 |
|
|
$ |
5,574 |
|
|
$ |
5,745 |
|
|
$ |
5,580 |
|
Non-performing TDRs |
14,605 |
|
|
2,428 |
|
|
1,943 |
|
|
2,276 |
|
|
2,684 |
|
|||||
Total TDRs |
$ |
21,405 |
|
|
$ |
22,673 |
|
|
$ |
7,517 |
|
|
$ |
8,021 |
|
|
$ |
8,264 |
|
Loan delinquencies increased by 7.9% to $56.3 million at September 30, 2019, primarily related to the increase in our 30 to 89 days delinquent loans. The increase in our total delinquent loans resulted from $21.4 million of additions, partially offset by $11.4 million returning to current status and $5.8 million of principal payments or payoffs. Loans 90+ days delinquent includes single family mortgage residential loans, which accounts for 66% of the balance. Loan delinquencies as a percentage of total loans held-for-investment increased to 88 basis points for the quarter, almost exclusively due to single family residential mortgage loans, of which $8.7 million have cured since quarter end, and the reduction in our balance sheet over the same period.
Non-performing loans and non performing assets increased to $45.2 million as of September 30, 2019, primarily as a result of a $14.5 million, non-agented Shared National Credit moving from performing to non-performing during the quarter. The loan continues in a current payment status and subsequent payments will be recognized as a reduction of the loan balance. The Company currently has five Shared National Credits totaling $47.4 million. The increase in non-performing TDRs during the third quarter was primarily due to one loan relationship moving from performing to non-performing.
Allowance for Loan Losses
|
Three Months Ended |
||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
|
($ in thousands) |
||||||||||||||||||
Allowance for loan losses (ALLL) |
|
|
|
|
|
|
|
|
|
||||||||||
Balance at beginning of period |
$ |
59,523 |
|
|
$ |
63,885 |
|
|
$ |
62,192 |
|
|
$ |
57,782 |
|
|
$ |
56,678 |
|
Loans and leases charged off |
$ |
(35,546 |
) |
|
$ |
(2,451 |
) |
|
$ |
(1,063 |
) |
|
$ |
(2,522 |
) |
|
$ |
(388 |
) |
Recoveries |
$ |
410 |
|
|
$ |
76 |
|
|
$ |
244 |
|
|
$ |
279 |
|
|
$ |
82 |
|
Net charge-offs |
$ |
(35,136 |
) |
|
$ |
(2,375 |
) |
|
$ |
(819 |
) |
|
$ |
(2,243 |
) |
|
$ |
(306 |
) |
Provision for (reversal of) loan losses |
$ |
38,540 |
|
|
$ |
(1,987 |
) |
|
$ |
2,512 |
|
|
$ |
6,653 |
|
|
$ |
1,410 |
|
Balance at end of period |
$ |
62,927 |
|
|
$ |
59,523 |
|
|
$ |
63,885 |
|
|
$ |
62,192 |
|
|
$ |
57,782 |
|
Annualized net loan charge-offs to average total loans held-for-investment |
2.19 |
% |
|
0.13 |
% |
|
0.04 |
% |
|
0.12 |
% |
|
0.02 |
% |
|||||
Reserve for loss on repurchased loans |
|
|
|
|
|
|
|
|
|
||||||||||
Balance at beginning of period |
$ |
2,478 |
|
|
$ |
2,486 |
|
|
$ |
2,506 |
|
|
$ |
2,575 |
|
|
$ |
3,149 |
|
Additions |
4,415 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|||||
Reversal of provision for loan repurchases |
(123 |
) |
|
(8 |
) |
|
(20 |
) |
|
(69 |
) |
|
(342 |
) |
|||||
Utilization of reserve for loan repurchases |
(209 |
) |
|
— |
|
|
— |
|
|
— |
|
|
(232 |
) |
|||||
Balance at end of period |
$ |
6,561 |
|
|
$ |
2,478 |
|
|
$ |
2,486 |
|
|
$ |
2,506 |
|
|
$ |
2,575 |
|
Charge-offs for the third quarter totaled $35.5 million, which primarily consisted of the previously reported $35.1 million charge-off of a line of credit originated by the Bank in November 2017 to a borrower that was purported to be the subject of a fraudulent scheme, as previously reported by the Company on Form 8-K. The provision for loan losses increased due to net charge-offs of $35.1 million, an increase of $3.0 million due to an increase in loss factors associated with the large charge-off and increases in other qualitative provisions resulting in an allowance for loan losses of $62.9 million, or 0.99% of total loans held-for-investment. The reserve for loss on repurchased loans increased by $4.4 million due to the contractual agreement associated with the multifamily loan securitization completed in the third quarter of 2019. As the securitization balance subsequently decreases, the reserve for loss on repurchased loans is also expected to decrease.
Securities Litigation Update
During the third quarter of 2019, we entered into a tentative settlement agreement, subject to court approval, for $19.75 million in connection with the Securities Litigation matter. As a result of the agreement, there is no expected impact to earnings as the settlement will be paid directly by the Company's insurance carriers.
The Company will host a conference call to discuss its third quarter 2019 financial results at 10:00 a.m. Pacific Time (PT) on Wednesday, October 23, 2019. Interested parties are welcome to attend the conference call by dialing 888-317-6003, and referencing event code 1817922. 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 $8.6 billion in assets and one wholly-owned banking subsidiary, Banc of California, N.A. (the “Bank”). The Bank has 43 offices including 32 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. 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 |
|||||||||||||||||||
(Dollars in thousands) |
|||||||||||||||||||
(Unaudited) |
|||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
ASSETS |
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents |
$ |
526,874 |
|
|
$ |
313,850 |
|
|
$ |
304,705 |
|
|
$ |
391,592 |
|
|
$ |
372,221 |
|
Securities available-for-sale |
775,662 |
|
|
1,167,687 |
|
|
1,471,303 |
|
|
1,992,500 |
|
|
2,059,832 |
|
|||||
Loans held-for-sale |
23,936 |
|
|
597,720 |
|
|
25,191 |
|
|
8,116 |
|
|
9,382 |
|
|||||
Loans held-for-investment |
6,383,259 |
|
|
6,719,570 |
|
|
7,557,200 |
|
|
7,700,873 |
|
|
7,253,293 |
|
|||||
Allowance for loan losses |
(62,927 |
) |
|
(59,523 |
) |
|
(63,885 |
) |
|
(62,192 |
) |
|
(57,782 |
) |
|||||
Federal Home Loan Bank and other bank stock |
71,679 |
|
|
76,373 |
|
|
55,794 |
|
|
68,094 |
|
|
71,308 |
|
|||||
Servicing rights, net |
2,407 |
|
|
2,715 |
|
|
3,053 |
|
|
3,428 |
|
|
3,770 |
|
|||||
Other real estate owned, net |
— |
|
|
276 |
|
|
316 |
|
|
672 |
|
|
434 |
|
|||||
Premises and equipment, net |
128,979 |
|
|
129,227 |
|
|
130,417 |
|
|
129,394 |
|
|
133,129 |
|
|||||
Investments in alternative energy partnerships, net |
27,039 |
|
|
26,633 |
|
|
26,578 |
|
|
28,988 |
|
|
41,781 |
|
|||||
Goodwill |
37,144 |
|
|
37,144 |
|
|
37,144 |
|
|
37,144 |
|
|
37,144 |
|
|||||
Other intangible assets, net |
4,605 |
|
|
5,105 |
|
|
5,726 |
|
|
6,346 |
|
|
6,990 |
|
|||||
Deferred income tax, net |
45,950 |
|
|
42,798 |
|
|
45,111 |
|
|
49,404 |
|
|
47,865 |
|
|||||
Income tax receivable |
4,459 |
|
|
2,547 |
|
|
4,787 |
|
|
2,695 |
|
|
1,764 |
|
|||||
Bank owned life insurance investment |
108,720 |
|
|
108,132 |
|
|
107,552 |
|
|
107,027 |
|
|
106,468 |
|
|||||
Right of use assets |
23,907 |
|
|
24,118 |
|
|
24,519 |
|
|
— |
|
|
— |
|
|||||
Due from unsettled securities sales |
334,769 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|||||
Other assets |
188,875 |
|
|
165,559 |
|
|
151,014 |
|
|
146,496 |
|
|
152,933 |
|
|||||
Assets of discontinued operations |
— |
|
|
— |
|
|
— |
|
|
19,490 |
|
|
20,290 |
|
|||||
Total assets |
$ |
8,625,337 |
|
|
$ |
9,359,931 |
|
|
$ |
9,886,525 |
|
|
$ |
10,630,067 |
|
|
$ |
10,260,822 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
||||||||||
Noninterest-bearing deposits |
$ |
1,107,442 |
|
|
$ |
993,745 |
|
|
$ |
1,120,700 |
|
|
$ |
1,023,360 |
|
|
$ |
1,061,557 |
|
Interest-bearing deposits |
4,662,616 |
|
|
5,298,545 |
|
|
6,604,232 |
|
|
6,893,284 |
|
|
6,340,185 |
|
|||||
Total deposits |
5,770,058 |
|
|
6,292,290 |
|
|
7,724,932 |
|
|
7,916,644 |
|
|
7,401,742 |
|
|||||
Advances from Federal Home Loan Bank |
1,650,000 |
|
|
1,825,000 |
|
|
935,000 |
|
|
1,520,000 |
|
|
1,640,000 |
|
|||||
Notes payable, net |
173,339 |
|
|
173,257 |
|
|
173,203 |
|
|
173,174 |
|
|
173,096 |
|
|||||
Reserve for loss on repurchased loans |
6,561 |
|
|
2,478 |
|
|
2,486 |
|
|
2,506 |
|
|
2,575 |
|
|||||
Lease liabilities |
25,210 |
|
|
25,457 |
|
|
25,893 |
|
|
— |
|
|
— |
|
|||||
Due on unsettled securities purchases |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
17,500 |
|
|||||
Accrued expenses and other liabilities |
99,181 |
|
|
77,905 |
|
|
76,686 |
|
|
72,209 |
|
|
79,231 |
|
|||||
Total liabilities |
7,724,349 |
|
|
8,396,387 |
|
|
8,938,200 |
|
|
9,684,533 |
|
|
9,314,144 |
|
|||||
Commitments and contingent liabilities |
|
|
|
|
|
|
|
|
|
||||||||||
Preferred stock |
189,825 |
|
|
231,128 |
|
|
231,128 |
|
|
231,128 |
|
|
231,128 |
|
|||||
Common stock |
520 |
|
|
520 |
|
|
518 |
|
|
518 |
|
|
518 |
|
|||||
Common stock, class B non-voting non-convertible |
5 |
|
|
5 |
|
|
5 |
|
|
5 |
|
|
5 |
|
|||||
Additional paid-in capital |
628,774 |
|
|
627,306 |
|
|
626,608 |
|
|
625,834 |
|
|
624,789 |
|
|||||
Retained earnings |
120,221 |
|
|
146,039 |
|
|
136,943 |
|
|
140,952 |
|
|
140,971 |
|
|||||
Treasury stock |
(28,786 |
) |
|
(28,786 |
) |
|
(28,786 |
) |
|
(28,786 |
) |
|
(28,786 |
) |
|||||
Accumulated other comprehensive loss, net |
(9,571 |
) |
|
(12,668 |
) |
|
(18,091 |
) |
|
(24,117 |
) |
|
(21,947 |
) |
|||||
Total stockholders’ equity |
900,988 |
|
|
963,544 |
|
|
948,325 |
|
|
945,534 |
|
|
946,678 |
|
|||||
Total liabilities and stockholders’ equity |
$ |
8,625,337 |
|
|
$ |
9,359,931 |
|
|
$ |
9,886,525 |
|
|
$ |
10,630,067 |
|
|
$ |
10,260,822 |
|
Banc of California, Inc. |
|||||||||||||||||||||||||||
Consolidated Statements of Operations |
|||||||||||||||||||||||||||
(Dollars in thousands, except per share data) |
|||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|
September 30,
|
|
September 30,
|
||||||||||||||
Interest and dividend income |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Loans, including fees |
$ |
80,287 |
|
|
$ |
89,159 |
|
|
$ |
90,558 |
|
|
$ |
88,258 |
|
|
$ |
84,795 |
|
|
$ |
260,004 |
|
|
$ |
241,014 |
|
Securities |
10,024 |
|
|
12,457 |
|
|
17,841 |
|
|
19,882 |
|
|
20,599 |
|
|
40,322 |
|
|
63,685 |
|
|||||||
Other interest-earning assets |
2,346 |
|
|
2,424 |
|
|
2,313 |
|
|
2,990 |
|
|
2,380 |
|
|
7,083 |
|
|
6,967 |
|
|||||||
Total interest and dividend income |
92,657 |
|
|
104,040 |
|
|
110,712 |
|
|
111,130 |
|
|
107,774 |
|
|
307,409 |
|
|
311,666 |
|
|||||||
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Deposits |
22,811 |
|
|
28,598 |
|
|
31,443 |
|
|
28,972 |
|
|
25,154 |
|
|
82,852 |
|
|
62,264 |
|
|||||||
Federal Home Loan Bank advances |
8,519 |
|
|
8,289 |
|
|
9,081 |
|
|
9,068 |
|
|
8,996 |
|
|
25,889 |
|
|
25,927 |
|
|||||||
Securities sold under repurchase agreements |
13 |
|
|
16 |
|
|
18 |
|
|
25 |
|
|
47 |
|
|
47 |
|
|
1,008 |
|
|||||||
Notes payable and other interest-bearing liabilities |
2,399 |
|
|
2,357 |
|
|
2,362 |
|
|
2,383 |
|
|
2,385 |
|
|
7,118 |
|
|
7,073 |
|
|||||||
Total interest expense |
33,742 |
|
|
39,260 |
|
|
42,904 |
|
|
40,448 |
|
|
36,582 |
|
|
115,906 |
|
|
96,272 |
|
|||||||
Net interest income |
58,915 |
|
|
64,780 |
|
|
67,808 |
|
|
70,682 |
|
|
71,192 |
|
|
191,503 |
|
|
215,394 |
|
|||||||
Provision for (reversal of) loan and lease losses |
38,540 |
|
|
(1,987 |
) |
|
2,512 |
|
|
6,653 |
|
|
1,410 |
|
|
39,065 |
|
|
23,562 |
|
|||||||
Net interest income after provision for loan and lease losses |
20,375 |
|
|
66,767 |
|
|
65,296 |
|
|
64,029 |
|
|
69,782 |
|
|
152,438 |
|
|
191,832 |
|
|||||||
Noninterest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Customer service fees |
1,582 |
|
|
1,434 |
|
|
1,515 |
|
|
1,786 |
|
|
1,446 |
|
|
4,531 |
|
|
4,529 |
|
|||||||
Loan servicing income |
128 |
|
|
121 |
|
|
118 |
|
|
22 |
|
|
439 |
|
|
367 |
|
|
3,698 |
|
|||||||
Income from bank owned life insurance |
588 |
|
|
580 |
|
|
525 |
|
|
559 |
|
|
551 |
|
|
1,693 |
|
|
1,617 |
|
|||||||
Impairment loss on investment securities |
(731 |
) |
|
— |
|
|
— |
|
|
(3,252 |
) |
|
— |
|
|
(731 |
) |
|
— |
|
|||||||
Net (loss) gain on sale of securities available for sale |
(5,063 |
) |
|
— |
|
|
208 |
|
|
— |
|
|
13 |
|
|
(4,855 |
) |
|
5,532 |
|
|||||||
Net gain on sale of loans |
4,326 |
|
|
2,826 |
|
|
1,553 |
|
|
873 |
|
|
279 |
|
|
8,705 |
|
|
1,059 |
|
|||||||
All other income (loss) |
2,351 |
|
|
(7,251 |
) |
|
2,376 |
|
|
2,460 |
|
|
2,096 |
|
|
(2,524 |
) |
|
5,032 |
|
|||||||
Total noninterest income |
3,181 |
|
|
(2,290 |
) |
|
6,295 |
|
|
2,448 |
|
|
4,824 |
|
|
7,186 |
|
|
21,467 |
|
|||||||
Noninterest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Salaries and employee benefits |
25,934 |
|
|
27,506 |
|
|
28,439 |
|
|
24,587 |
|
|
24,832 |
|
|
81,879 |
|
|
85,387 |
|
|||||||
Occupancy and equipment |
7,767 |
|
|
7,955 |
|
|
7,686 |
|
|
8,064 |
|
|
8,213 |
|
|
23,408 |
|
|
23,783 |
|
|||||||
Professional fees (reimbursement) |
1,463 |
|
|
(2,903 |
) |
|
11,041 |
|
|
6,206 |
|
|
11,966 |
|
|
9,601 |
|
|
27,446 |
|
|||||||
Data processing |
1,568 |
|
|
1,672 |
|
|
1,496 |
|
|
1,733 |
|
|
1,884 |
|
|
4,736 |
|
|
5,218 |
|
|||||||
Advertising |
2,090 |
|
|
2,048 |
|
|
2,057 |
|
|
3,371 |
|
|
3,152 |
|
|
6,195 |
|
|
9,293 |
|
|||||||
Regulatory assessments |
1,239 |
|
|
2,136 |
|
|
2,482 |
|
|
1,252 |
|
|
2,138 |
|
|
5,857 |
|
|
6,426 |
|
|||||||
(Reversal of) provision for loan repurchases |
(123 |
) |
|
(61 |
) |
|
(116 |
) |
|
(122 |
) |
|
(360 |
) |
|
(300 |
) |
|
(2,366 |
) |
|||||||
Amortization of intangible assets |
500 |
|
|
621 |
|
|
620 |
|
|
644 |
|
|
693 |
|
|
1,741 |
|
|
2,363 |
|
|||||||
Restructuring (reversal) expense |
— |
|
|
(158 |
) |
|
2,795 |
|
|
(105 |
) |
|
553 |
|
|
2,637 |
|
|
4,536 |
|
|||||||
All other expenses |
3,809 |
|
|
5,126 |
|
|
3,385 |
|
|
3,153 |
|
|
5,322 |
|
|
12,320 |
|
|
16,872 |
|
|||||||
Total noninterest expense excluding loss (gain) on investments in alternative energy partnerships |
44,247 |
|
|
43,942 |
|
|
59,885 |
|
|
48,783 |
|
|
58,393 |
|
|
148,074 |
|
|
178,958 |
|
|||||||
(Gain) loss on investments in alternative energy partnerships |
(940 |
) |
|
(355 |
) |
|
1,950 |
|
|
786 |
|
|
2,484 |
|
|
655 |
|
|
4,258 |
|
|||||||
Total noninterest expense |
43,307 |
|
|
43,587 |
|
|
61,835 |
|
|
49,569 |
|
|
60,877 |
|
|
148,729 |
|
|
183,216 |
|
|||||||
(Loss) income from continuing operations before income taxes |
(19,751 |
) |
|
20,890 |
|
|
9,756 |
|
|
16,908 |
|
|
13,729 |
|
|
10,895 |
|
|
30,083 |
|
|||||||
Income tax (benefit) expense |
(5,619 |
) |
|
4,308 |
|
|
2,719 |
|
|
6,117 |
|
|
3,301 |
|
|
1,408 |
|
|
(1,273 |
) |
|||||||
(Loss) income from continuing operations |
(14,132 |
) |
|
16,582 |
|
|
7,037 |
|
|
10,791 |
|
|
10,428 |
|
|
9,487 |
|
|
31,356 |
|
|||||||
Income from discontinued operations before income taxes |
— |
|
|
— |
|
|
— |
|
|
347 |
|
|
924 |
|
|
— |
|
|
4,249 |
|
|||||||
Income tax expense |
— |
|
|
— |
|
|
— |
|
|
100 |
|
|
256 |
|
|
— |
|
|
1,171 |
|
|||||||
Income from discontinued operations |
— |
|
|
— |
|
|
— |
|
|
247 |
|
|
668 |
|
|
— |
|
|
3,078 |
|
|||||||
Net (loss) income |
(14,132 |
) |
|
16,582 |
|
|
7,037 |
|
|
11,038 |
|
|
11,096 |
|
|
9,487 |
|
|
34,434 |
|
|||||||
Preferred stock dividends |
3,403 |
|
|
4,308 |
|
|
4,308 |
|
|
4,308 |
|
|
4,970 |
|
|
12,019 |
|
|
15,196 |
|
|||||||
Income allocated to participating securities |
— |
|
|
271 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|||||||
Participating securities dividends |
94 |
|
|
94 |
|
|
202 |
|
|
203 |
|
|
202 |
|
|
390 |
|
|
608 |
|
|||||||
Impact of preferred stock redemption |
5,093 |
|
|
— |
|
|
— |
|
|
— |
|
|
2,307 |
|
|
5,093 |
|
|
2,307 |
|
|||||||
Net (loss) income available to common stockholders |
$ |
(22,722 |
) |
|
$ |
11,909 |
|
|
$ |
2,527 |
|
|
$ |
6,527 |
|
|
$ |
3,617 |
|
|
$ |
(8,015 |
) |
|
$ |
16,323 |
|
Basic (loss) earnings per common share |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
(Loss) income from continuing operations |
$ |
(0.45 |
) |
|
$ |
0.23 |
|
|
$ |
0.05 |
|
|
$ |
0.12 |
|
|
$ |
0.06 |
|
|
$ |
(0.16 |
) |
|
$ |
0.26 |
|
Income from discontinued operations |
— |
|
|
— |
|
|
— |
|
|
0.01 |
|
|
0.01 |
|
|
— |
|
|
0.06 |
|
|||||||
Net income |
$ |
(0.45 |
) |
|
$ |
0.23 |
|
|
$ |
0.05 |
|
|
$ |
0.13 |
|
|
$ |
0.07 |
|
|
$ |
(0.16 |
) |
|
$ |
0.32 |
|
Diluted (loss) earnings per common share |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
(Loss) income from continuing operations |
$ |
(0.45 |
) |
|
$ |
0.23 |
|
|
$ |
0.05 |
|
|
$ |
0.12 |
|
|
$ |
0.06 |
|
|
$ |
(0.16 |
) |
|
$ |
0.26 |
|
Income from discontinued operations |
— |
|
|
— |
|
|
— |
|
|
0.01 |
|
|
0.01 |
|
|
— |
|
|
0.06 |
|
|||||||
Net (loss) income |
$ |
(0.45 |
) |
|
$ |
0.23 |
|
|
$ |
0.05 |
|
|
$ |
0.13 |
|
|
$ |
0.07 |
|
|
$ |
(0.16 |
) |
|
$ |
0.32 |
|
Weighted average number of common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic |
50,882,227 |
|
|
50,857,137 |
|
|
50,676,722 |
|
|
50,651,805 |
|
|
50,656,076 |
|
|
50,804,429 |
|
|
50,613,590 |
|
|||||||
Diluted |
50,882,227 |
|
|
50,964,956 |
|
|
50,846,722 |
|
|
50,812,874 |
|
|
50,899,464 |
|
|
50,896,437 |
|
|
50,896,437 |
|
|||||||
Dividends declared per common share |
$ |
0.06 |
|
|
$ |
0.06 |
|
|
$ |
0.13 |
|
|
$ |
0.13 |
|
|
$ |
0.13 |
|
|
$ |
0.19 |
|
|
$ |
0.39 |
|
Banc of California, Inc. |
||||||||||||||
Selected Financial Data |
||||||||||||||
(Unaudited) |
||||||||||||||
|
Three Months Ended |
|||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|||||
Profitability and other ratios of consolidated operations |
|
|
|
|
|
|
|
|
|
|||||
Return on average assets(1) |
(0.64 |
)% |
|
0.69 |
% |
|
0.28 |
% |
|
0.43 |
% |
|
0.43 |
% |
Return on average equity(1) |
(5.83 |
)% |
|
6.91 |
% |
|
2.98 |
% |
|
4.56 |
% |
|
4.40 |
% |
Return on average tangible common equity(2) |
(12.49 |
)% |
|
7.43 |
% |
|
1.91 |
% |
|
4.19 |
% |
|
2.49 |
% |
Dividend payout ratio(3) |
(13.33 |
)% |
|
26.09 |
% |
|
260.00 |
% |
|
100.00 |
% |
|
185.71 |
% |
Net interest spread |
2.47 |
% |
|
2.50 |
% |
|
2.47 |
% |
|
2.56 |
% |
|
2.62 |
% |
Net interest margin(1) |
2.86 |
% |
|
2.86 |
% |
|
2.81 |
% |
|
2.88 |
% |
|
2.93 |
% |
Noninterest income (loss) to total revenue(4) |
5.12 |
% |
|
(3.66 |
)% |
|
8.49 |
% |
|
3.60 |
% |
|
7.42 |
% |
Noninterest income (loss) to average total assets(1) |
0.15 |
% |
|
(0.10 |
)% |
|
0.25 |
% |
|
0.10 |
% |
|
0.22 |
% |
Noninterest expense to average total assets(1) |
1.98 |
% |
|
1.82 |
% |
|
2.43 |
% |
|
1.92 |
% |
|
2.38 |
% |
Efficiency ratio(2)(5) |
69.74 |
% |
|
69.75 |
% |
|
83.44 |
% |
|
67.47 |
% |
|
79.15 |
% |
Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships(2)(5) |
68.31 |
% |
|
67.84 |
% |
|
83.00 |
% |
|
67.09 |
% |
|
77.88 |
% |
Average loans held-for-investment to average deposits |
105.92 |
% |
|
104.38 |
% |
|
100.45 |
% |
|
97.40 |
% |
|
97.00 |
% |
Average securities available-for-sale to average total assets |
12.71 |
% |
|
13.58 |
% |
|
17.00 |
% |
|
19.85 |
% |
|
21.28 |
% |
Average stockholders’ equity to average total assets |
11.06 |
% |
|
10.02 |
% |
|
9.29 |
% |
|
9.38 |
% |
|
9.85 |
% |
| (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 loan and lease losses and noninterest income (loss). |
|
| (5) | The ratios are calculated by dividing noninterest expense by the sum of net interest income before provision for loan and lease losses and noninterest income (loss). |
Banc of California, Inc. |
|||||||||||||||||||
Selected Financial Data, Continued |
|||||||||||||||||||
(Dollars in thousands) |
|||||||||||||||||||
(Unaudited) |
|||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
Loans and ALLL by loan origination type |
|
|
|
|
|
|
|
|
|
||||||||||
Loan breakdown by origination type |
|
|
|
|
|
|
|
|
|
||||||||||
Originated loans |
$ |
5,888,647 |
|
|
$ |
6,181,583 |
|
|
$ |
6,991,056 |
|
|
$ |
7,105,171 |
|
|
$ |
6,683,683 |
|
Acquired loans not impaired at acquisition |
494,612 |
|
|
537,987 |
|
|
566,144 |
|
|
595,702 |
|
|
569,610 |
|
|||||
Total loans |
$ |
6,383,259 |
|
|
$ |
6,719,570 |
|
|
$ |
7,557,200 |
|
|
$ |
7,700,873 |
|
|
$ |
7,253,293 |
|
ALLL breakdown by origination type |
|
|
|
|
|
|
|
|
|
||||||||||
Originated loans |
$ |
61,306 |
|
|
$ |
58,135 |
|
|
$ |
63,003 |
|
|
$ |
61,256 |
|
|
$ |
56,672 |
|
Acquired loans not impaired at acquisition |
1,621 |
|
|
1,388 |
|
|
882 |
|
|
937 |
|
|
1,110 |
|
|||||
Total ALLL |
$ |
62,927 |
|
|
$ |
59,523 |
|
|
$ |
63,885 |
|
|
$ |
62,193 |
|
|
$ |
57,782 |
|
Discount on acquired loans not impaired at acquisition |
$ |
9,062 |
|
|
$ |
10,680 |
|
|
$ |
11,184 |
|
|
$ |
11,645 |
|
|
$ |
12,311 |
|
Percentage of ALLL to: |
|
|
|
|
|
|
|
|
|
||||||||||
Originated loans |
1.04 |
% |
|
0.94 |
% |
|
0.90 |
% |
|
0.86 |
% |
|
0.85 |
% |
|||||
Originated loans and acquired loans not impaired at acquisition |
0.99 |
% |
|
0.89 |
% |
|
0.85 |
% |
|
0.81 |
% |
|
0.80 |
% |
|||||
Total loans |
0.99 |
% |
|
0.89 |
% |
|
0.85 |
% |
|
0.81 |
% |
|
0.80 |
% |
|||||
Banc of California, Inc. |
||||||||||||||||||||||||||||||||
Average Balance, Average Yield Earned, and Average Cost Paid |
||||||||||||||||||||||||||||||||
(Dollars in thousands) |
||||||||||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||||||||||
|
Three Months Ended |
|||||||||||||||||||||||||||||||
|
September 30, 2019 |
|
June 30, 2019 |
|
March 31, 2019 |
|||||||||||||||||||||||||||
|
Average |
|
|
|
Yield |
|
Average |
|
|
|
Yield |
|
Average |
|
|
|
Yield |
|||||||||||||||
|
Balance |
|
Interest |
|
/ Cost |
|
Balance |
|
Interest |
|
/ Cost |
|
Balance |
|
Interest |
|
/ Cost |
|||||||||||||||
Interest earning assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Loans held-for-sale (1) |
$ |
216,746 |
|
|
$ |
1,894 |
|
|
3.47 |
% |
|
$ |
47,233 |
|
|
$ |
265 |
|
|
2.25 |
% |
|
$ |
31,374 |
|
|
$ |
228 |
|
|
2.95 |
% |
SFR mortgage |
1,866,103 |
|
|
19,179 |
|
|
4.08 |
% |
|
2,059,704 |
|
|
21,390 |
|
|
4.17 |
% |
|
2,312,900 |
|
|
24,062 |
|
|
4.22 |
% |
||||||
Commercial real estate, multifamily, and construction |
2,717,609 |
|
|
33,343 |
|
|
4.87 |
% |
|
3,406,672 |
|
|
39,659 |
|
|
4.67 |
% |
|
3,387,698 |
|
|
38,117 |
|
|
4.56 |
% |
||||||
Commercial and industrial, SBA, and lease financing |
1,840,202 |
|
|
24,970 |
|
|
5.38 |
% |
|
1,872,289 |
|
|
26,940 |
|
|
5.77 |
% |
|
1,920,220 |
|
|
27,235 |
|
|
5.75 |
% |
||||||
Other consumer |
58,652 |
|
|
901 |
|
|
6.09 |
% |
|
59,806 |
|
|
905 |
|
|
6.07 |
% |
|
62,558 |
|
|
916 |
|
|
5.94 |
% |
||||||
Gross loans and leases |
6,699,312 |
|
|
80,287 |
|
|
4.75 |
% |
|
7,445,704 |
|
|
89,159 |
|
|
4.80 |
% |
|
7,714,750 |
|
|
90,558 |
|
|
4.76 |
% |
||||||
Securities |
1,105,499 |
|
|
10,024 |
|
|
3.60 |
% |
|
1,304,876 |
|
|
12,457 |
|
|
3.83 |
% |
|
1,751,509 |
|
|
17,841 |
|
|
4.13 |
% |
||||||
Other interest-earning assets |
362,613 |
|
|
2,346 |
|
|
2.57 |
% |
|
342,908 |
|
|
2,424 |
|
|
2.84 |
% |
|
321,823 |
|
|
2,313 |
|
|
2.91 |
% |
||||||
Total interest-earning assets |
8,167,424 |
|
|
92,657 |
|
|
4.50 |
% |
|
9,093,488 |
|
|
104,040 |
|
|
4.59 |
% |
|
9,788,082 |
|
|
110,712 |
|
|
4.59 |
% |
||||||
Allowance for loan losses |
(55,976 |
) |
|
|
|
|
|
(63,046 |
) |
|
|
|
|
|
(61,924 |
) |
|
|
|
|
||||||||||||
BOLI and noninterest earning assets |
584,190 |
|
|
|
|
|
|
580,133 |
|
|
|
|
|
|
575,559 |
|
|
|
|
|
||||||||||||
Total assets |
$ |
8,695,638 |
|
|
|
|
|
|
$ |
9,610,575 |
|
|
|
|
|
|
$ |
10,301,717 |
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-bearing liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Savings |
$ |
1,055,086 |
|
|
$ |
4,722 |
|
|
1.78 |
% |
|
$ |
1,083,571 |
|
|
$ |
4,950 |
|
|
1.83 |
% |
|
$ |
1,201,802 |
|
|
$ |
5,480 |
|
|
1.85 |
% |
Interest-bearing checking |
1,511,432 |
|
|
4,483 |
|
|
1.18 |
% |
|
1,580,165 |
|
|
4,554 |
|
|
1.16 |
% |
|
1,554,846 |
|
|
4,525 |
|
|
1.18 |
% |
||||||
Money market |
755,114 |
|
|
3,093 |
|
|
1.63 |
% |
|
853,007 |
|
|
3,902 |
|
|
1.83 |
% |
|
887,538 |
|
|
4,128 |
|
|
1.89 |
% |
||||||
Certificates of deposit |
1,750,970 |
|
|
10,513 |
|
|
2.38 |
% |
|
2,537,060 |
|
|
15,192 |
|
|
2.40 |
% |
|
2,982,980 |
|
|
17,310 |
|
|
2.35 |
% |
||||||
Total interest-bearing deposits |
5,072,602 |
|
|
22,811 |
|
|
1.78 |
% |
|
6,053,803 |
|
|
28,598 |
|
|
1.89 |
% |
|
6,627,166 |
|
|
31,443 |
|
|
1.92 |
% |
||||||
FHLB advances |
1,333,739 |
|
|
8,519 |
|
|
2.53 |
% |
|
1,287,121 |
|
|
8,289 |
|
|
2.58 |
% |
|
1,422,100 |
|
|
9,081 |
|
|
2.59 |
% |
||||||
Securities sold under repurchase agreements |
1,922 |
|
|
13 |
|
|
2.68 |
% |
|
2,173 |
|
|
16 |
|
|
2.95 |
% |
|
2,350 |
|
|
18 |
|
|
3.11 |
% |
||||||
Long-term debt and other interest-bearing liabilities |
174,111 |
|
|
2,399 |
|
|
5.47 |
% |
|
174,161 |
|
|
2,357 |
|
|
5.43 |
% |
|
174,230 |
|
|
2,362 |
|
|
5.50 |
% |
||||||
Total interest-bearing liabilities |
6,582,374 |
|
|
33,742 |
|
|
2.03 |
% |
|
7,517,258 |
|
|
39,260 |
|
|
2.09 |
% |
|
8,225,846 |
|
|
42,904 |
|
|
2.12 |
% |
||||||
Noninterest-bearing deposits |
1,047,858 |
|
|
|
|
|
|
1,034,205 |
|
|
|
|
|
|
1,021,741 |
|
|
|
|
|
||||||||||||
Noninterest-bearing liabilities |
103,667 |
|
|
|
|
|
|
96,179 |
|
|
|
|
|
|
97,430 |
|
|
|
|
|
||||||||||||
Total liabilities |
7,733,899 |
|
|
|
|
|
|
8,647,642 |
|
|
|
|
|
|
9,345,017 |
|
|
|
|
|
||||||||||||
Total stockholders’ equity |
961,739 |
|
|
|
|
|
|
962,933 |
|
|
|
|
|
|
956,700 |
|
|
|
|
|
||||||||||||
Total liabilities and stockholders’ equity |
$ |
8,695,638 |
|
|
|
|
|
|
$ |
9,610,575 |
|
|
|
|
|
|
$ |
10,301,717 |
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net interest income/spread |
|
|
$ |
58,915 |
|
|
2.47 |
% |
|
|
|
$ |
64,780 |
|
|
2.50 |
% |
|
|
|
$ |
67,808 |
|
|
2.47 |
% |
||||||
Net interest margin |
|
|
|
|
2.86 |
% |
|
|
|
|
|
2.86 |
% |
|
|
|
|
|
2.81 |
% |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities |
124.08 |
% |
|
|
|
|
|
120.97 |
% |
|
|
|
|
|
118.99 |
% |
|
|
|
|
||||||||||||
Total deposits |
$ |
6,120,460 |
|
|
$ |
22,811 |
|
|
1.48 |
% |
|
$ |
7,088,008 |
|
|
$ |
28,598 |
|
|
1.62 |
% |
|
$ |
7,648,907 |
|
|
$ |
31,443 |
|
|
1.67 |
% |
Total funding (2) |
$ |
7,630,232 |
|
|
$ |
33,742 |
|
|
1.75 |
% |
|
$ |
8,551,463 |
|
|
$ |
39,260 |
|
|
1.84 |
% |
|
$ |
9,247,587 |
|
|
$ |
42,904 |
|
|
1.88 |
% |
(1) |
Includes loans held-for-sale of discontinued operations for the three months ended December 31, 2018. |
|
(2) |
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 |
|||||||||||||||||||||
|
December 31, 2018 |
|
September 30, 2018 |
||||||||||||||||||
|
Average |
|
|
|
Yield |
|
Average |
|
|
|
Yield |
||||||||||
|
Balance |
|
Interest |
|
/ Cost |
|
Balance |
|
Interest |
|
/ Cost |
||||||||||
Interest earning assets |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans held-for-sale (1) |
$ |
33,243 |
|
|
$ |
221 |
|
|
2.64 |
% |
|
$ |
42,754 |
|
|
$ |
263 |
|
|
2.44 |
% |
SFR mortgage |
2,260,205 |
|
|
23,585 |
|
|
4.14 |
% |
|
2,222,602 |
|
|
23,461 |
|
|
4.19 |
% |
||||
Commercial real estate, multifamily, and construction |
3,246,860 |
|
|
37,403 |
|
|
4.57 |
% |
|
3,091,706 |
|
|
35,838 |
|
|
4.60 |
% |
||||
Commercial and industrial, SBA, and lease financing |
1,791,708 |
|
|
26,219 |
|
|
5.81 |
% |
|
1,739,711 |
|
|
24,382 |
|
|
5.56 |
% |
||||
Other consumer |
68,479 |
|
|
990 |
|
|
5.74 |
% |
|
69,600 |
|
|
981 |
|
|
5.59 |
% |
||||
Gross loans and leases |
7,400,495 |
|
|
88,418 |
|
|
4.74 |
% |
|
7,166,373 |
|
|
84,925 |
|
|
4.70 |
% |
||||
Securities |
2,032,632 |
|
|
19,882 |
|
|
3.88 |
% |
|
2,163,037 |
|
|
20,599 |
|
|
3.78 |
% |
||||
Other interest-earning assets |
318,419 |
|
|
2,990 |
|
|
3.73 |
% |
|
335,160 |
|
|
2,380 |
|
|
2.82 |
% |
||||
Total interest-earning assets |
9,751,546 |
|
|
111,290 |
|
|
4.53 |
% |
|
9,664,570 |
|
|
107,904 |
|
|
4.43 |
% |
||||
Allowance for loan losses |
(58,099 |
) |
|
|
|
|
|
(56,730 |
) |
|
|
|
|
||||||||
BOLI and non-interest earning assets |
544,302 |
|
|
|
|
|
|
554,636 |
|
|
|
|
|
||||||||
Total assets |
$ |
10,237,749 |
|
|
|
|
|
|
$ |
10,162,476 |
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing liabilities |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Savings |
1,279,155 |
|
|
5,663 |
|
|
1.76 |
% |
|
1,231,696 |
|
|
5,122 |
|
|
1.65 |
% |
||||
Interest-bearing checking |
1,666,884 |
|
|
4,916 |
|
|
1.17 |
% |
|
1,789,679 |
|
|
5,054 |
|
|
1.12 |
% |
||||
Money market |
803,157 |
|
|
3,168 |
|
|
1.56 |
% |
|
966,165 |
|
|
3,455 |
|
|
1.42 |
% |
||||
Certificates of deposit |
2,759,665 |
|
|
15,225 |
|
|
2.19 |
% |
|
2,332,181 |
|
|
11,523 |
|
|
1.96 |
% |
||||
Total interest-bearing deposits |
6,508,861 |
|
|
28,972 |
|
|
1.77 |
% |
|
6,319,721 |
|
|
25,154 |
|
|
1.58 |
% |
||||
FHLB advances |
1,447,348 |
|
|
9,068 |
|
|
2.49 |
% |
|
1,528,674 |
|
|
8,996 |
|
|
2.33 |
% |
||||
Securities sold under repurchase agreements |
3,116 |
|
|
25 |
|
|
3.18 |
% |
|
6,418 |
|
|
47 |
|
|
2.91 |
% |
||||
Long-term debt and other interest-bearing liabilities |
174,281 |
|
|
2,383 |
|
|
5.42 |
% |
|
174,361 |
|
|
2,385 |
|
|
5.43 |
% |
||||
Total interest-bearing liabilities |
8,133,606 |
|
|
40,448 |
|
|
1.97 |
% |
|
8,029,174 |
|
|
36,582 |
|
|
1.81 |
% |
||||
Noninterest-bearing deposits |
1,054,790 |
|
|
|
|
|
|
1,023,890 |
|
|
|
|
|
||||||||
Non-interest-bearing liabilities |
89,111 |
|
|
|
|
|
|
108,593 |
|
|
|
|
|
||||||||
Total liabilities |
9,277,507 |
|
|
|
|
|
|
9,161,657 |
|
|
|
|
|
||||||||
Total stockholders’ equity |
960,242 |
|
|
|
|
|
|
1,000,819 |
|
|
|
|
|
||||||||
Total liabilities and stockholders’ equity |
$ |
10,237,749 |
|
|
|
|
|
|
$ |
10,162,476 |
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest income/spread |
|
|
$ |
70,842 |
|
|
2.56 |
% |
|
|
|
$ |
71,322 |
|
|
2.62 |
% |
||||
Net interest margin |
|
|
|
|
2.88 |
% |
|
|
|
|
|
2.93 |
% |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratio of interest-earning assets to interest-bearing liabilities |
119.89 |
% |
|
|
|
|
|
120.37 |
% |
|
|
|
|
||||||||
Total deposits |
$ |
7,563,651 |
|
|
$ |
28,972 |
|
|
1.52 |
% |
|
$ |
7,343,611 |
|
|
$ |
25,154 |
|
|
1.36 |
% |
Total funding (2) |
$ |
9,188,396 |
|
|
$ |
40,448 |
|
|
1.75 |
% |
|
$ |
9,053,064 |
|
|
$ |
36,582 |
|
|
1.60 |
% |
| (1) | Includes loans held-for-sale of discontinued operations. |
|
| (2) | 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. |
Nine Months Ended |
|||||||||||||||||||||
|
September 30, 2019 |
|
September 30, 2018 |
||||||||||||||||||
|
Average |
|
|
|
Yield |
|
Average |
|
|
|
Yield |
||||||||||
|
Balance |
|
Interest |
|
/ Cost |
|
Balance |
|
Interest |
|
/ Cost |
||||||||||
Interest earning assets |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans held-for-sale (1) |
$ |
99,130 |
|
|
$ |
2,388 |
|
|
3.22 |
% |
|
$ |
64,681 |
|
|
$ |
888 |
|
|
1.84 |
% |
SFR mortgage |
2,077,932 |
|
|
64,631 |
|
|
4.16 |
% |
|
2,189,991 |
|
|
67,603 |
|
|
4.13 |
% |
||||
Commercial real estate, multifamily, and construction |
3,168,206 |
|
|
111,119 |
|
|
4.69 |
% |
|
2,979,866 |
|
|
101,013 |
|
|
4.53 |
% |
||||
Commercial and industrial, SBA, and lease financing |
1,877,277 |
|
|
79,145 |
|
|
5.64 |
% |
|
1,691,331 |
|
|
68,896 |
|
|
5.45 |
% |
||||
Other consumer |
60,324 |
|
|
2,721 |
|
|
6.03 |
% |
|
84,363 |
|
|
3,119 |
|
|
4.94 |
% |
||||
Gross loans and leases |
7,282,869 |
|
|
260,004 |
|
|
4.77 |
% |
|
7,010,232 |
|
|
241,519 |
|
|
4.61 |
% |
||||
Securities |
1,384,928 |
|
|
40,322 |
|
|
3.89 |
% |
|
2,321,231 |
|
|
63,685 |
|
|
3.67 |
% |
||||
Other interest-earning assets |
342,597 |
|
|
7,083 |
|
|
2.76 |
% |
|
377,925 |
|
|
6,967 |
|
|
2.46 |
% |
||||
Total interest-earning assets |
9,010,394 |
|
|
307,409 |
|
|
4.56 |
% |
|
9,709,388 |
|
|
312,171 |
|
|
4.30 |
% |
||||
Allowance for loan losses |
(60,294 |
) |
|
|
|
|
|
(53,657 |
) |
|
|
|
|
||||||||
BOLI and non-interest earning assets |
579,992 |
|
|
|
|
|
|
564,856 |
|
|
|
|
|
||||||||
Total assets |
$ |
9,530,092 |
|
|
|
|
|
|
$ |
10,220,587 |
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing liabilities |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Savings |
1,112,949 |
|
|
15,152 |
|
|
1.82 |
% |
|
1,114,888 |
|
|
12,308 |
|
|
1.48 |
% |
||||
Interest-bearing checking |
1,548,655 |
|
|
13,562 |
|
|
1.17 |
% |
|
1,862,215 |
|
|
13,345 |
|
|
0.96 |
% |
||||
Money market |
831,401 |
|
|
11,124 |
|
|
1.79 |
% |
|
1,058,451 |
|
|
9,978 |
|
|
1.26 |
% |
||||
Certificates of deposit |
2,419,158 |
|
|
43,014 |
|
|
2.38 |
% |
|
2,107,782 |
|
|
26,633 |
|
|
1.69 |
% |
||||
Total interest-bearing deposits |
5,912,163 |
|
|
82,852 |
|
|
1.87 |
% |
|
6,143,336 |
|
|
62,264 |
|
|
1.36 |
% |
||||
FHLB advances |
1,347,330 |
|
|
25,889 |
|
|
2.57 |
% |
|
1,688,355 |
|
|
25,927 |
|
|
2.05 |
% |
||||
Securities sold under repurchase agreements |
2,146 |
|
|
47 |
|
|
2.93 |
% |
|
51,542 |
|
|
1,008 |
|
|
2.61 |
% |
||||
Long-term debt and other interest-bearing liabilities |
174,167 |
|
|
7,118 |
|
|
5.46 |
% |
|
174,360 |
|
|
7,073 |
|
|
5.42 |
% |
||||
Total interest-bearing liabilities |
7,435,806 |
|
|
115,906 |
|
|
2.08 |
% |
|
8,057,593 |
|
|
96,272 |
|
|
1.60 |
% |
||||
Noninterest-bearing deposits |
1,034,697 |
|
|
|
|
|
|
1,028,245 |
|
|
|
|
|
||||||||
Non-interest-bearing liabilities |
99,113 |
|
|
|
|
|
|
127,607 |
|
|
|
|
|
||||||||
Total liabilities |
8,569,616 |
|
|
|
|
|
|
9,213,445 |
|
|
|
|
|
||||||||
Total stockholders’ equity |
960,476 |
|
|
|
|
|
|
1,007,142 |
|
|
|
|
|
||||||||
Total liabilities and stockholders’ equity |
$ |
9,530,092 |
|
|
|
|
|
|
$ |
10,220,587 |
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest income/spread |
|
|
$ |
191,503 |
|
|
2.48 |
% |
|
|
|
$ |
215,899 |
|
|
2.70 |
% |
||||
Net interest margin |
|
|
|
|
2.84 |
% |
|
|
|
|
|
2.97 |
% |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ratio of interest-earning assets to interest-bearing liabilities |
121.18 |
% |
|
|
|
|
|
120.50 |
% |
|
|
|
|
||||||||
Total deposits |
$ |
6,946,860 |
|
|
$ |
82,852 |
|
|
1.59 |
% |
|
$ |
7,171,581 |
|
|
$ |
62,264 |
|
|
1.16 |
% |
Total funding (2) |
$ |
8,470,503 |
|
|
$ |
115,906 |
|
|
1.83 |
% |
|
$ |
9,085,838 |
|
|
$ |
96,272 |
|
|
1.42 |
% |
(1) |
Includes loans held-for-sale of discontinued operations. |
|
(2) |
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.
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
Tangible common equity, and tangible common equity to tangible assets ratio |
|
|
|
|
|
|
|
|
|
||||||||||
Total assets |
$ |
8,625,337 |
|
|
$ |
9,359,931 |
|
|
$ |
9,886,525 |
|
|
$ |
10,630,067 |
|
|
$ |
10,260,822 |
|
Less goodwill |
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|||||
Less other intangible assets |
(4,605 |
) |
|
(5,105 |
) |
|
(5,726 |
) |
|
(6,346 |
) |
|
(6,990 |
) |
|||||
Tangible assets(1) |
$ |
8,583,588 |
|
|
$ |
9,317,682 |
|
|
$ |
9,843,655 |
|
|
$ |
10,586,577 |
|
|
$ |
10,216,688 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total stockholders' equity |
$ |
900,988 |
|
|
$ |
963,544 |
|
|
$ |
948,325 |
|
|
$ |
945,534 |
|
|
$ |
946,678 |
|
Less goodwill |
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|||||
Less other intangible assets |
(4,605 |
) |
|
(5,105 |
) |
|
(5,726 |
) |
|
(6,346 |
) |
|
(6,990 |
) |
|||||
Tangible equity(1) |
859,239 |
|
|
921,295 |
|
|
905,455 |
|
|
902,044 |
|
|
902,544 |
|
|||||
Less preferred stock |
(189,825 |
) |
|
(231,128 |
) |
|
(231,128 |
) |
|
(231,128 |
) |
|
(231,128 |
) |
|||||
Tangible common equity(1) |
$ |
669,414 |
|
|
$ |
690,167 |
|
|
$ |
674,327 |
|
|
$ |
670,916 |
|
|
$ |
671,416 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total stockholders' equity to total assets |
10.45 |
% |
|
10.29 |
% |
|
9.59 |
% |
|
8.89 |
% |
|
9.23 |
% |
|||||
Tangible equity to tangible assets(1) |
10.01 |
% |
|
9.89 |
% |
|
9.20 |
% |
|
8.52 |
% |
|
8.83 |
% |
|||||
Tangible common equity to tangible assets(1) |
7.80 |
% |
|
7.41 |
% |
|
6.85 |
% |
|
6.34 |
% |
|
6.57 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Common shares outstanding |
50,406,763 |
|
|
50,397,769 |
|
|
50,315,490 |
|
|
50,172,018 |
|
|
50,180,607 |
|
|||||
Class B non-voting non-convertible common shares outstanding |
477,321 |
|
|
477,321 |
|
|
477,321 |
|
|
477,321 |
|
|
477,321 |
|
|||||
Total common shares outstanding |
50,884,084 |
|
|
50,875,090 |
|
|
50,792,811 |
|
|
50,649,339 |
|
|
50,657,928 |
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Tangible common equity per common share(1) |
$ |
13.16 |
|
|
$ |
13.57 |
|
|
$ |
13.28 |
|
|
$ |
13.25 |
|
|
$ |
13.25 |
|
Book value per common share |
$ |
13.98 |
|
|
$ |
14.40 |
|
|
$ |
14.12 |
|
|
$ |
14.10 |
|
|
$ |
14.13 |
|
(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 |
|||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|||||||||||
Return on tangible common equity |
|
|
|
|
|
|
|
|
|
|||||||||||
Average total stockholders' equity |
$ |
961,739 |
|
|
$ |
962,933 |
|
|
$ |
956,700 |
|
|
$ |
960,242 |
|
|
$ |
1,000,819 |
|
|
Less average preferred stock |
(213,619 |
) |
|
(231,128 |
) |
|
(231,128 |
) |
|
(231,128 |
) |
|
(260,822 |
) |
||||||
Less average goodwill |
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
|
(37,144 |
) |
||||||
Less average other intangible assets |
(4,935 |
) |
|
(5,503 |
) |
|
(6,128 |
) |
|
(6,731 |
) |
|
(7,412 |
) |
||||||
Average tangible common equity(1) |
$ |
706,041 |
|
|
$ |
689,158 |
|
|
$ |
682,300 |
|
|
$ |
685,239 |
|
|
$ |
695,441 |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net (loss) income |
$ |
(14,132 |
) |
|
$ |
16,582 |
|
|
$ |
7,037 |
|
|
$ |
11,038 |
|
|
$ |
11,096 |
|
|
Less preferred stock dividends and impact of preferred stock redemption |
(8,496 |
) |
|
(4,308 |
) |
|
(4,308 |
) |
|
(4,308 |
) |
|
(7,277 |
) |
||||||
Add amortization of intangible assets |
500 |
|
|
621 |
|
|
620 |
|
|
644 |
|
|
693 |
|
||||||
Less tax effect on amortization and impairment of intangible assets |
(105 |
) |
|
(130 |
) |
|
(130 |
) |
|
(135 |
) |
|
(146 |
) |
||||||
Net (loss) income available to common stockholders(1) |
$ |
(22,233 |
) |
|
$ |
12,765 |
|
|
$ |
3,219 |
|
|
$ |
7,239 |
|
|
$ |
4,366 |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Return on average equity |
(5.83 |
)% |
|
6.91 |
% |
|
2.98 |
% |
|
4.56 |
% |
|
4.40 |
% |
||||||
Return on average tangible common equity(1) |
(12.49 |
)% |
|
7.43 |
% |
|
1.91 |
% |
|
4.19 |
% |
|
2.49 |
% |
||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
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 |
|||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
|||||||||||
Adjusted efficiency ratio including the pre-tax effect of
|
|
|
|
|
|
|
|
|
|
|||||||||||
Noninterest expense |
$ |
43,307 |
|
|
$ |
43,587 |
|
|
$ |
61,835 |
|
|
$ |
49,578 |
|
|
$ |
60,977 |
|
|
Gain (loss) on investments in alternative energy partnerships |
940 |
|
|
355 |
|
|
(1,950 |
) |
|
(786 |
) |
|
(2,484 |
) |
||||||
Adjusted noninterest expense(1) |
$ |
44,247 |
|
|
$ |
43,942 |
|
|
$ |
59,885 |
|
|
$ |
48,792 |
|
|
$ |
58,493 |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net interest income |
$ |
58,915 |
|
|
$ |
64,780 |
|
|
$ |
67,808 |
|
|
$ |
70,842 |
|
|
$ |
71,322 |
|
|
Noninterest income |
3,181 |
|
|
(2,290 |
) |
|
6,295 |
|
|
2,644 |
|
|
5,718 |
|
||||||
Total revenue |
62,096 |
|
|
62,490 |
|
|
74,103 |
|
|
73,486 |
|
|
77,040 |
|
||||||
Tax credit from investments in alternative energy partnerships |
1,757 |
|
|
1,680 |
|
|
— |
|
|
— |
|
|
412 |
|
||||||
Deferred tax expense on investments in alternative energy partnerships |
(184 |
) |
|
(176 |
) |
|
— |
|
|
— |
|
|
(43 |
) |
||||||
Tax effect on tax credit and deferred tax expense |
162 |
|
|
426 |
|
|
— |
|
|
26 |
|
|
180 |
|
||||||
Gain (loss) on investments in alternative energy partnerships |
940 |
|
|
355 |
|
|
(1,950 |
) |
|
(786 |
) |
|
(2,484 |
) |
||||||
Total pre-tax adjustments for investments in alternative energy partnerships |
2,675 |
|
|
2,285 |
|
|
(1,950 |
) |
|
(760 |
) |
|
(1,935 |
) |
||||||
Adjusted total revenue(1) |
$ |
64,771 |
|
|
$ |
64,775 |
|
|
$ |
72,153 |
|
|
$ |
72,726 |
|
|
$ |
75,105 |
|
|
Efficiency ratio(1) |
69.74 |
% |
|
69.75 |
% |
|
83.44 |
% |
|
67.47 |
% |
|
79.15 |
% |
||||||
Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships(1) |
68.31 |
% |
|
67.84 |
% |
|
83.00 |
% |
|
67.09 |
% |
|
77.88 |
% |
||||||
Effective tax rate utilized for calculating tax effect on tax credit and deferred tax expense |
9.36 |
% |
|
22.07 |
% |
|
27.00 |
% |
|
27.42 |
% |
|
32.81 |
% |
||||||
(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 |
||||||||||||||||||
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
September 30,
|
||||||||||
Total noninterest expense excluding loss (gain) on investments in alternative energy partnerships |
$ |
44,247 |
|
|
$ |
43,942 |
|
|
$ |
59,885 |
|
|
$ |
48,783 |
|
|
$ |
58,393 |
|
(Gain) loss on investments in alternative energy partnerships |
(940 |
) |
|
(355 |
) |
|
1,950 |
|
|
786 |
|
|
2,484 |
|
|||||
Total noninterest expense |
43,307 |
|
|
43,587 |
|
|
61,835 |
|
|
49,569 |
|
|
60,877 |
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Less: non-core items |
|
|
|
|
|
|
|
|
|
||||||||||
Data processing |
— |
|
|
(797 |
) |
|
— |
|
|
— |
|
|
— |
|
|||||
Professional fees |
2,615 |
|
|
6,214 |
|
|
(2,979 |
) |
|
2,711 |
|
|
(5,919 |
) |
|||||
Restructuring expense |
— |
|
|
158 |
|
|
(2,795 |
) |
|
105 |
|
|
(554 |
) |
|||||
Other expenses |
(131 |
) |
|
— |
|
|
— |
|
|
585 |
|
|
(1,478 |
) |
|||||
Total |
45,791 |
|
|
49,162 |
|
|
56,061 |
|
|
52,970 |
|
|
52,926 |
|
|||||
Add: Gain (loss) on investments in alternative energy partnerships |
940 |
|
|
355 |
|
|
(1,950 |
) |
|
(786 |
) |
|
(2,484 |
) |
|||||
Total operating expense |
$ |
46,731 |
|
|
$ |
49,517 |
|
|
$ |
54,111 |
|
|
$ |
52,184 |
|
|
$ |
50,442 |
|
(1) |
Non-GAAP measure. |
