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Press Release

Banc of California Reports Second Quarter 2019 Earnings

Company Release - 7/25/2019 6:00 AM ET

SANTA ANA, Calif.--(BUSINESS WIRE)-- Banc of California, Inc. (NYSE: BANC) today reported net income available to common stockholders of $11.9 million, for the second quarter of 2019, resulting in diluted earnings per common share of $0.23.

Highlights for the second quarter included:

  • Net interest margin increased by 5 basis points from the prior quarter to 2.86% for the second quarter, resulting from a 5 basis point decline in our cost of deposits
  • Loan production was $599 million for the quarter, including $186 million of commercial and industrial loan commitments
  • Loan delinquencies decreased by 12.2% from the prior quarter to $52.2 million
  • Held-for-investment loan balances for the second quarter decreased to $6.7 billion as we sold lower coupon single family and multifamily loans and transferred $574 million of multifamily loans to held-for-sale, pending a planned Freddie Mac securitization
  • Collateralized loan obligations declined to $737 million following $298 million of sales and calls
  • Noninterest expense was $43.6 million for the quarter, including non-core expenses of $6.2 million of litigation, indemnification, investigation and other legal fees, $12.6 million of insurance recoveries, and net project charge-offs of $869 thousand
  • Efficiency ratio for the second quarter decreased to 69.75%
  • Return on average assets increased to 0.69%, while return on average tangible common equity was 7.43%

Jared Wolff, President and Chief Executive Officer of Banc of California, commented, “The second quarter results reflect our accelerated efforts to focus on our three initiatives designed to improve our franchise and profitability on an ongoing basis: reducing our cost of deposits, optimizing the balance sheet to focus on higher-margin products and appropriately managing down expenses to the size and complexity of the business. Through these efforts, we continue to transform our franchise into a relationship-focused community bank, maintaining our high credit quality and serving businesses, entrepreneurs and individuals within our footprint. Further, as part of our efforts to improve our balance sheet, we commenced today a tender offer for our preferred equity for up to $75 million aggregate purchase price.”

Speaking specifically about operational results for the quarter, John Bogler, Chief Financial Officer of Banc of California said “The sales of non-core and low-margin assets allowed us to reduce high costing deposits, resulting in a 5 basis point decline in the cost of total deposits. Efforts to simplify our operating model allowed noninterest expense and operating expenses each to come in below $50 million for the quarter, which is ahead of our schedule for reducing expenses.”

Business Results - Income Statement Highlights

 

Three Months Ended

 

June 30,
2019

 

March 31,
2019

 

December 31,
2018

 

September 30,
2018

 

June 30,
2018

Total interest and dividend income

$

104,040

 

 

$

110,712

 

 

$

111,130

 

 

$

107,774

 

 

$

105,185

 

Total interest expense

 

39,260

 

 

 

42,904

 

 

 

40,448

 

 

 

36,582

 

 

 

32,421

 

(Reversal of) provision for loan and lease losses

 

(1,987

)

 

 

2,512

 

 

 

6,653

 

 

 

1,410

 

 

 

2,653

 

Net interest income after provision for loan and lease losses

 

66,767

 

 

 

65,296

 

 

 

64,029

 

 

 

69,782

 

 

 

70,111

 

Total noninterest (loss) income

 

(2,290

)

 

 

6,295

 

 

 

2,448

 

 

 

4,824

 

 

 

8,061

 

Total noninterest expense

 

43,587

 

 

 

61,835

 

 

 

49,569

 

 

 

60,877

 

 

 

62,539

 

Income tax expense

 

4,308

 

 

 

2,719

 

 

 

6,117

 

 

 

3,301

 

 

 

1,779

 

Income from continuing operations

 

16,582

 

 

 

7,037

 

 

 

10,791

 

 

 

10,428

 

 

 

13,854

 

Income from discontinued operations

 

 

 

 

 

247

 

 

 

668

 

 

 

926

 

Net income

$

16,582

 

 

$

7,037

 

 

$

11,038

 

 

$

11,096

 

 

$

14,780

 

Net interest income

Net interest income for the second quarter decreased to $64.8 million as we sold non-core assets and repaid high cost funding during the quarter. For the second quarter, average interest-earning assets declined from the prior quarter by $695 million to $9.1 billion, while the net interest margin improved by 5 basis points versus the prior quarter.

Our average yield on interest-earning assets remained flat at 4.59% for the second quarter as compared to the first quarter of 2019, primarily attributable to an increase in our average yield on loans partially offset by a decrease in our average yield on securities. Our average yield on loans came in at 4.80% for the second quarter which increased by 4 basis points from the prior quarter, primarily attributable to a reduction in lower-yielding single family residential mortgage and multifamily loans. Our average yield on securities decreased primarily as a result of an interest rate reset on our collateralized loan obligations and a decrease in our average balance attributable to the sale and calls of $298 million of our higher yielding collateralized loan obligations during the second quarter. The decline in the average balance of collateralized loan obligations was also due to sales that occurred late in the first quarter of 2019. We sold a significant amount of these securities at the end of the first quarter, with the full impact of the first quarter sales reflected in the second quarter.

Our average cost of interest-bearing liabilities decreased to 2.09% for the second quarter from 2.12% for the first quarter, primarily resulting from a 5 basis point decrease in our average cost of total deposits from the prior quarter to 1.62% for the second quarter. The decrease in our cost of deposits from the prior quarter primarily resulted from the shift in our deposit strategy to focus on relationship-based customers and de-emphasize high-rate transactional customers.

Provision for loan losses

During the second quarter, we released $2.0 million of our allowance for loan losses primarily attributable to a decrease in the held-for-investment loan portfolio, partially offset by an increase in net charge-offs and other qualitative provisions during the quarter. The decrease in the loan portfolio primarily resulted from the sale of $178 million of multifamily loans and the transfer of $574 million of multifamily loans to held-for-sale. During the quarter, we had $2.4 million in net charge-off activity and a $900 thousand increase in our specific reserves. The net charge-offs were driven primarily by a charge-off of $2.0 million on one commercial and industrial loan relationship.

Noninterest (loss) income

Noninterest (loss) income for the second quarter was $(2.3) million, which represented a decrease of $8.6 million, or 136.38% from the prior quarter. The decrease is primarily attributable to a $9.6 million loss on our hedge of the pending Freddie Mac multifamily securitization in which we also plan to sell the associated mortgage servicing rights. The $9.6 million hedging loss is due to a decline in interest rates since the hedge was executed and is expected to be mostly offset by the gain in fair value of the loans sold into the securitization in the third quarter. This was partially offset by an increase of $1.3 million in our gain on sale of loans during the second quarter, resulting from the sale of $178 million and $344 million of multifamily and single family residential mortgage loans, respectively.

Noninterest expense

Noninterest expense for the second quarter was $43.6 million, which represented a decrease of $18.2 million, or 29.5%, from the prior quarter. The decrease primarily relates to: (1) a $13.9 million decline 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 $3.0 million of net expense in the prior quarter, (2) $158 thousand reversal true-up related to restructuring expense in the second quarter as compared to $2.8 million of restructuring expense in the prior quarter, and (3) a 933 thousand decrease in our compensation expense resulting from lower headcount. The net recovery of $6.2 million in insurance proceeds from the securities litigation, indemnification, investigation and other legal expenses reduced our efficiency ratio by 10%.

Income taxes

Taxes totaled $4.3 million for the quarter, representing an increase of 58% from the prior quarter, and an effective tax rate of 20.62%. During the second quarter of 2019, we closed on a tax planning strategy investment that is expected to produce $3.4 million of investment tax credits in 2019, resulting in a 5% reduction in the projected annual effective tax rate. For the full year, we expect our tax rate to normalize closer to 20%.

Balance Sheet

The following table shows selected balance sheet line items as of June 30, 2019 and for the previous four quarters. As indicated in the table below, at June 30, 2019, total assets were approximately $9.4 billion, which represented a decrease of $527 million 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

 

June 30,
2019

March 31,
2019

December 31,
2018

September 30,
2018

June 30,
2018

Q2-19 vs. Q1
19

Q2-19 vs. Q2
18

 

 

 

 

 

 

 

 

Total assets

$

9,359,931

 

$

9,886,525

 

$

10,630,067

 

$

10,260,822

 

$

10,319,280

 

$

(526,594

)

$

(959,349

)

Securities available-for-sale

$

1,167,687

 

$

1,471,303

 

$

1,992,500

 

$

2,059,832

 

$

2,297,124

 

$

(303,616

)

$

(1,129,437

)

Loans held-for-investment

$

6,719,570

 

$

7,557,200

 

$

7,700,873

 

$

7,253,293

 

$

7,036,004

 

$

(837,630

)

$

(316,434

)

Loans held-for-sale

$

597,720

 

$

25,191

 

$

8,116

 

$

9,382

 

$

13,753

 

$

572,529

 

$

583,967

 

 

 

 

 

 

 

 

 

Demand deposits

$

2,571,646

 

$

2,694,199

 

$

2,579,770

 

$

2,775,347

 

$

2,783,432

 

$

(122,553

)

$

(211,786

)

Other core deposits

 

3,239,667

 

 

3,735,667

 

 

3,793,605

 

 

3,638,624

 

 

3,666,159

 

 

(496,000

)

 

(426,492

)

Brokered deposits

 

480,977

 

 

1,295,066

 

 

1,543,269

 

 

987,771

 

 

686,203

 

 

(814,089

)

 

(205,226

)

Total Deposits

$

6,292,290

 

$

7,724,932

 

$

7,916,644

 

$

7,401,742

 

$

7,135,794

 

$

(1,432,642

)

$

(843,504

)

As percentage of total deposits

 

 

 

 

 

 

 

Demand deposits

 

40.87

%

 

34.88

%

 

32.59

%

 

37.50

%

 

39.01

%

 

5.99

%

 

1.86

%

Other core deposits

 

51.49

%

 

48.36

%

 

47.92

%

 

49.16

%

 

51.38

%

 

3.13

%

 

0.11

%

Brokered deposits

 

7.64

%

 

16.76

%

 

19.49

%

 

13.35

%

 

9.62

%

 

(9.12

)%

 

(1.98

)%

 

 

 

 

 

 

 

 

Average Loan Yield

 

4.80

%

 

4.76

%

 

4.74

%

 

4.70

%

 

4.63

%

 

0.04

%

 

0.17

%

Average Cost of Interest-Bearing Deposits

 

1.89

%

 

1.92

%

 

1.77

%

 

1.58

%

 

1.34

%

 

(0.03

)%

 

0.55

%

Investments

Securities available-for-sale declined to $1.2 billion, a decrease of 20.6% from the previous quarter, primarily due to the continued reduction in the size of the collateralized loan obligation portfolio. During the second quarter, $298 million of collateralized loan obligations were sold or called. As of June 30, 2019, our securities balance included $737 million of collateralized loan obligations, $852 thousand of small business administration loan pool securities, $429 million of agency residential mortgage-backed securities and $285 thousand of non-agency residential mortgage-backed securities.

Loans

The following table sets forth the composition, by loan category, of our loan portfolio at June 30, 2019 and the previous four quarters.

 

June 30,
2019

March 31,
2019

December 31,
2018

September 30,
2018

June 30,
2018

Composition of held-for-investment loans

 

 

 

 

 

Commercial real estate

$

856,497

 

$

865,521

 

$

867,013

 

$

823,193

 

$

793,855

 

Multifamily

 

1,598,978

 

 

2,332,527

 

 

2,241,246

 

 

2,112,190

 

 

1,959,965

 

Construction

 

209,029

 

 

211,549

 

 

203,976

 

 

200,294

 

 

211,110

 

Commercial and industrial

 

1,951,707

 

 

1,907,102

 

 

1,944,142

 

 

1,673,055

 

 

1,742,559

 

SBA

 

80,929

 

 

74,998

 

 

68,741

 

 

71,494

 

 

78,092

 

Total commercial loans

 

4,697,140

 

 

5,391,697

 

 

5,325,118

 

 

4,880,226

 

 

4,785,581

 

Single family residential mortgage

 

1,961,065

 

 

2,102,694

 

 

2,305,490

 

 

2,300,069

 

 

2,174,183

 

Other consumer

 

61,365

 

 

62,809

 

 

70,265

 

 

72,998

 

 

76,240

 

Total consumer loans

 

2,022,430

 

 

2,165,503

 

 

2,375,755

 

 

2,373,067

 

 

2,250,423

 

Total gross loans

$

6,719,570

 

$

7,557,200

 

$

7,700,873

 

$

7,253,293

 

$

7,036,004

 

Composition percentage of held-for-investment loans

 

 

 

 

 

Commercial real estate

 

12.7

%

 

11.5

%

 

11.3

%

 

11.3

%

 

11.3

%

Multifamily

 

23.8

%

 

30.9

%

 

29.2

%

 

29.1

%

 

27.9

%

Construction

 

3.1

%

 

2.8

%

 

2.6

%

 

2.8

%

 

3.0

%

Commercial and industrial

 

29.1

%

 

25.2

%

 

25.2

%

 

23.1

%

 

24.8

%

SBA

 

1.2

%

 

1.0

%

 

0.9

%

 

1.0

%

 

1.1

%

Total commercial loans

 

69.9

%

 

71.4

%

 

69.2

%

 

67.3

%

 

68.1

%

Single family residential mortgage

 

29.2

%

 

27.8

%

 

29.9

%

 

31.7

%

 

30.9

%

Other consumer

 

0.9

%

 

0.8

%

 

0.9

%

 

1.0

%

 

1.0

%

Total consumer loans

 

30.1

%

 

28.6

%

 

30.8

%

 

32.7

%

 

31.9

%

Total gross loans

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

Held-for-investment loans decreased to $6.7 billion driven mostly by the transfer of $574 million of multifamily loans from held-for-investment to held-for-sale during the quarter and the sale of $178 million and $131 million of multifamily and single family residential mortgage loans, respectively, partially offset by quarterly net production of $45 million. The quarterly net production increased from the prior quarter primarily as a result of new loan growth of $63 million during the quarter, and $128 million of single family residential mortgage loan production in the second quarter as opposed to $183 million during the first quarter of 2019. The $128 million of single family residential mortgage loan production in the second quarter represented funding on commitments made prior to our decision to discontinue the single family residential mortgage loan business. Going forward, we would expect minimal production from this business in the third and fourth quarters of 2019 as we focus on relationship lending.

Commercial real estate loans comprised 12.7% of the loan portfolio and commercial and industrial loans constituted 29.1%, with yields of 4.67% and 5.77%, respectively. During the second quarter of 2019, our commercial and industrial loan production was $186 million, which represented an increase of 12.6% over the prior quarter.

Held-for-sale loans increased by $573 million primarily resulting from the transfer of certain multifamily loans from loans held-for-investment related to our pending Freddie Mac multifamily securitization which is expected to close during the third quarter of 2019. The loans included in the securitization have a weighted average coupon of 3.79% and a weighted average term to initial reset of 3.5 years. The related mortgage servicing rights will also be sold.

Excluding the aforementioned loan sales and loans transferred to held-for-sale, the loan portfolio had net growth of $45 million from the prior quarter.

Deposits

The following table sets forth the composition of our deposits at June 30, 2019 and the previous four quarters.

 

June 30,
2019

March 31,
2019

December 31,
2018

September 30,
2018

June 30,
2018

Composition of deposits

 

 

 

 

 

Noninterest-bearing checking

$

993,745

 

$

1,120,700

 

$

1,023,360

 

$

1,061,557

 

$

1,005,032

 

Interest-bearing checking

 

1,577,901

 

 

1,573,499

 

 

1,556,410

 

 

1,713,790

 

 

1,778,400

 

Money market

 

800,898

 

 

899,330

 

 

873,153

 

 

856,886

 

 

1,136,335

 

Savings

 

1,061,115

 

 

1,151,442

 

 

1,265,847

 

 

1,269,489

 

 

1,175,275

 

Non-brokered certificates of deposit

 

1,479,137

 

 

1,684,895

 

 

1,654,605

 

 

1,512,249

 

 

1,354,549

 

Brokered certificates of deposit

 

379,494

 

 

1,295,066

 

 

1,543,269

 

 

987,771

 

 

686,203

 

Total deposits

$

6,292,290

 

$

7,724,932

 

$

7,916,644

 

$

7,401,742

 

$

7,135,794

 

Composition percentage of deposits

 

 

 

 

 

Noninterest-bearing checking

 

15.8

%

 

14.5

%

 

12.9

%

 

14.3

%

 

14.1

%

Interest-bearing checking

 

25.1

%

 

20.4

%

 

19.7

%

 

23.2

%

 

24.9

%

Money market

 

12.7

%

 

11.6

%

 

11.0

%

 

11.6

%

 

15.9

%

Savings

 

16.9

%

 

14.9

%

 

16.0

%

 

17.2

%

 

16.5

%

Non-brokered certificates of deposit

 

23.5

%

 

21.8

%

 

20.9

%

 

20.4

%

 

19.0

%

Brokered certificates of deposit

 

6.0

%

 

16.8

%

 

19.5

%

 

13.3

%

 

9.6

%

Total deposits

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

Deposits finished the second quarter at $6.3 billion, with noninterest-bearing deposits decreasing approximately $127 million. The decline in noninterest-bearing deposits for the quarter consisted primarily of transactional balances that fluctuate throughout the quarter but are expected to return. For the second quarter, the average balance of noninterest-bearing deposits was $1.034 billion up from the first quarter average balance of $1.022 billion. Total deposits decreased by $1.4 billion, of which $916 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.

Debt

Advances from the Federal Home Loan Bank (“FHLB”) increased $890 million, or 95%, to $1.8 billion as of June 30, 2019, as a result of overnight advances with the FHLB that we plan to pay down with the proceeds from the sale of loans sold into the Freddie Mac multifamily securitization which is expected to close in the third quarter. At the end of the quarter, the maturity dates of FHLB advances consisted of $645 million of overnight, $400 million maturing in 3 months or less, and $780 million maturing beyond 3 months. As of the end of the quarter, the overnight advance interest rate was 2.52%.

Equity

At June 30, 2019, stockholders’ equity increased by $15.2 million to $963.5 million, while tangible common equity was $690.2 million. The improvement in stockholders’ equity partially related to the improvement within our accumulated other comprehensive income as a result of other comprehensive income of $5.4 million. During the second quarter of 2019, we reduced the dividend per common share from 13 cents to 6 cents. Subsequent to June 30, 2019, we launched a tender offer for our preferred equity for up to $75 million aggregate purchase price with the tender offer expected to close by the end of August.

Capital remains strong with total risk based capital at 14.88% and a tier 1 leverage ratio of 9.62%. The following table sets forth our regulatory capital ratios at June 30, 2019 and the previous four quarters.

 

June 30,
2019

March 31,
2019

December 31,
2018

September 30,
2018

June 30,
2018

Capital Ratios

 

 

 

 

 

Banc of California, Inc.

 

 

 

 

 

Total risk-based capital ratio

14.88

%

14.01

%

13.71

%

14.05

%

14.71

%

Tier 1 risk-based capital ratio

13.91

%

13.03

%

12.77

%

13.15

%

13.83

%

Common equity tier 1 capital ratio

10.41

%

9.72

%

9.53

%

9.80

%

9.90

%

Tier 1 leverage ratio

9.62

%

8.87

%

8.95

%

8.99

%

9.30

%

Banc of California, NA

 

 

 

 

 

Total risk-based capital ratio

16.56

%

15.79

%

15.71

%

15.94

%

16.63

%

Tier 1 risk-based capital ratio

15.60

%

14.81

%

14.77

%

15.04

%

15.74

%

Common equity tier 1 capital ratio

15.60

%

14.81

%

14.77

%

15.04

%

15.74

%

Tier 1 leverage ratio

10.80

%

10.07

%

10.36

%

10.29

%

10.58

%

Credit Quality

 

June 30,
2019

March 31,
2019

December 31,
2018

September 30,
2018

June 30,
2018

Asset quality information and ratios

($ in thousands)

Delinquent loans held-for-investment

 

 

 

 

 

30 to 89 days delinquent

$

34,938

 

$

44,840

 

$

26,684

 

$

20,265

 

$

15,097

 

90+ days delinquent

 

17,272

 

 

14,623

 

 

13,846

 

 

15,269

 

 

11,453

 

Total delinquent loans

$

52,210

 

$

59,463

 

$

40,530

 

$

35,534

 

$

26,550

 

Total delinquent loans to total loans

 

0.78

%

 

0.79

%

 

0.53

%

 

0.49

%

 

0.38

%

Non-performing assets, excluding loans held-for-sale

 

 

 

 

 

Non-performing loans

$

28,499

 

$

27,739

 

$

21,585

 

$

25,523

 

$

22,290

 

90+ days delinquent and still accruing loans

 

275

 

 

731

 

 

470

 

 

 

Other real estate owned

 

276

 

 

316

 

 

672

 

 

434

 

 

710

 

Non-performing assets

$

29,050

 

$

28,786

 

$

22,727

 

$

25,957

 

$

23,000

 

ALLL to non-performing loans

 

206.86

%

 

224.40

%

 

281.99

%

 

226.39

%

 

254.28

%

Non-performing loans to total loans held-for-investment

 

0.43

%

 

0.38

%

 

0.29

%

 

0.35

%

 

0.32

%

Non-performing assets to total assets

 

0.31

%

 

0.29

%

 

0.21

%

 

0.25

%

 

0.22

%

Troubled debt restructurings (TDRs)

 

 

 

 

 

Performing TDRs

$

20,245

 

$

5,574

 

$

5,745

 

$

5,580

 

$

5,648

 

Non-performing TDRs

 

2,428

 

 

1,943

 

 

2,276

 

 

2,684

 

 

2,701

 

Total TDRs

$

22,673

 

$

7,517

 

$

8,021

 

$

8,264

 

$

8,349

 

Loan delinquencies decreased by 12.2% to $52.2 million at June 30, 2019, primarily related to the decrease in our 30 to 89 days delinquent loans. The decrease in our total delinquent loans resulted from $12.6 million returning to current status and $11.7 million of principal payments or payoffs, partially offset by $17.0 million of additions. Loans 90+ days delinquent includes single family mortgage residential loans, which account for 44% of the balance. Loan delinquencies as a percentage of total loans held-for-investment decreased to 78 basis points for the quarter, primarily resulting from the improvement in our delinquent loans, partially offset by the reduction in our balance sheet over the same period.

Non-performing loans increased slightly to $28.5 million as of June 30, 2019, while non-performing assets finished the second quarter at $29.1 million attributable to an increase in our nonperforming loans as of June 30, 2019, partially offset by a reduction in our other real estate owned and loans 90+ days delinquent and still accruing interest. The increase in performing TDRs during the second quarter was primarily due to one loan relationship.

Allowance for Loan Losses

 

Three Months Ended

 

June 30,
2019

March 31,
2019

December 31,
2018

September 30,
2018

June 30,
2018

 

($ in thousands)

Allowance for loan losses (ALLL)

 

 

 

 

 

Balance at beginning of period

$

63,885

 

$

62,192

 

$

57,782

 

$

56,678

 

$

54,763

 

Loans and leases charged off

$

(2,451

)

$

(1,063

)

$

(2,522

)

$

(388

)

$

(950

)

Recoveries

$

76

 

$

244

 

$

279

 

$

82

 

$

212

 

Net charge-offs

$

(2,375

)

$

(819

)

$

(2,243

)

$

(306

)

$

(738

)

(Reversal of) provision for loan losses

$

(1,987

)

$

2,512

 

$

6,653

 

$

1,410

 

$

2,653

 

Balance at end of period

$

59,523

 

$

63,885

 

$

62,192

 

$

57,782

 

$

56,678

 

Annualized net loan charge-offs to average total loans held-for-investment

 

0.13

%

 

0.04

%

 

0.12

%

 

0.02

%

 

0.04

%

Reserve for loss on repurchased loans

 

 

 

 

 

Balance at beginning of period

$

2,486

 

$

2,506

 

$

2,575

 

$

3,149

 

$

3,426

 

Reversal of provision for loan repurchases

 

(8

)

 

(20

)

 

(69

)

 

(342

)

 

(165

)

Utilization of reserve for loan repurchases

 

 

 

 

(232

)

 

(112

)

Balance at end of period

$

2,478

 

$

2,486

 

$

2,506

 

$

2,575

 

$

3,149

 

Charge-offs for the second quarter totaled $2.5 million, which primarily consisted of a $2.0 million write-down related to one loan relationship and a write-down of $425 thousand related to the sale of single family residential mortgage loans during the quarter. The allowance for loan losses decreased to $59.5 million, or 0.89% of total loans held-for-investment, primarily attributable to the release of $5.0 million resulting from the upcoming securitization of our multifamily portfolio and other decreases in the loan portfolio, partially offset by net charge-offs of $2.4 million and increases in other qualitative provisions during the quarter.

The Company will host a conference call to discuss its second quarter 2019 financial results at 10:00 a.m. Pacific Time (PT) on Thursday, July 25, 2019. Interested parties are welcome to attend the conference call by dialing 888-317-6003, and referencing event code 4783507. 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 $9 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 700+ 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. 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.

Additional Information

This press release is neither an offer to purchase nor a solicitation of an offer to sell securities. The tender offer for the outstanding depositary shares representing Banc of California, Inc.’s 7.00% Non-Cumulative Perpetual Preferred Stock, Series E and its 7.375% Non-Cumulative Perpetual Preferred Stock, Series D described in this press release is being made pursuant to an Offer to Purchase and related materials that Banc of California, Inc. has filed or will file with the Securities and Exchange Commission (the “SEC”) pursuant to a Schedule TO. The Schedule TO, Offer to Purchase, a related letter of transmittal and other tender offer documents contain important information that should be read carefully before any decision is made with respect to the tender offer. These materials (and all other documents Banc of California, Inc. has filed with the SEC) are available at no charge on the SEC's website at www.sec.gov.

 

Banc of California, Inc.

Consolidated Statements of Financial Condition

(Dollars in thousands)

(Unaudited)

 

Ju