Fourth Quarter of 2014 Highlights
- Net Earnings of $71.0 Million, or $0.69 Per Diluted
Share; Adjusted Net Earnings of $68.2 Million, or $0.66 Per Diluted
Share
- Core Net Interest Margin at 5.52%
- $307.5 Million of Loan and Lease Growth in the Quarter
Driven by $950.4 Million of Production
- Demand Deposits Increased $88.9 Million in the Quarter
and are 25% of Total Deposits
- Core Deposits Increased $128.6 Million in the Quarter
and are 52% of Total Deposits
Calendar Year 2014 Highlights
- Net Earnings of $168.9 Million, or $1.92 Per Diluted
Share; Adjusted Net Earnings of $220.4 Million, or $2.50 Per
Diluted Share
- Core Net Interest Margin at 5.60%
- $684.0 Million of Organic Loan and Lease Growth in the
Year Driven by $3.0 Billion of Production
- Demand Deposits Increased $612.9 Million
- Organic Core Deposit Growth of $700.3
Million
PacWest Bancorp (Nasdaq:PACW) today announced net
earnings for the fourth quarter of 2014 of $71.0 million, or $0.69
per diluted share, compared to net earnings for the third quarter
of 2014 of $62.3 million, or $0.60 per diluted share. Net earnings
for calendar year 2014 are $168.9 million, or $1.92 per diluted
share, compared to net earnings of $45.1 million for calendar year
2013, or $1.08 per diluted share. The significant increase in
annual net earnings is largely the result of the CapitalSource
merger that closed on April 7, 2014.
When certain income and expense items described below are
excluded, adjusted net earnings are $68.2 million, or $0.66 per
diluted share, for the fourth quarter of 2014 and $67.2 million, or
$0.65 per diluted share, for the third quarter of 2014. Adjusted
net earnings are $220.4 million, or $2.50 per diluted share, for
calendar year 2014 and $77.5 million, or $1.86 per diluted share,
for calendar year 2013.
Matt Wagner, President and CEO, commented, "2014 was truly a
transformative year for the Company with the completion of the
CapitalSource merger on April 7. We more than doubled our asset
size and combined a national lending platform with our
California-based deposit franchise. Our teams originated $3.0
billion of loans and leases in 2014 and increased core deposits by
$700 million, of which $265 million are new accounts from
CapitalSource division borrowers. Our 2014 net earnings almost
quadrupled to $168.9 million from $45.1 million in 2013, and our
adjusted net earnings for 2014 almost tripled to $220.4 million
from $77.5 million in 2013. These strong operating results allowed
us to distribute more than $114 million of cash dividends to our
stockholders in 2014, with last quarter's regular cash dividend
being increased 100% to $0.50 per share."
Mr. Wagner continued, "Our loan and lease portfolio has been
diversified along product and geographical lines, and overall
credit quality has improved as demonstrated by a 1.09%
nonperforming asset ratio and a 92% coverage ratio on nonaccruals.
The Company's capital position remains quite strong, with tangible
capital at 12.2%. We steadily improved tangible book value per
share, which increased $4.44 per share during the year and reached
$17.17 per share at year end. Overall, the Company and the Bank are
well positioned for continued success."
Vic Santoro, Executive Vice President and CFO, stated "Our
fourth quarter results are equally as good as those for the full
year. Reported and adjusted net earnings of $71.0 million and $68.2
million resulted in returns on tangible equity of 16.0% and 15.4%.
Our core net interest margin remains quite strong at 5.52%, and our
NIM, when adjusted for all the effects of purchase accounting,
increased to 5.10% in the fourth quarter. We continue to closely
control operating expenses as shown by the adjusted efficiency
ratio, which declined to 42.3% in the fourth quarter. Our focus in
2015 will continue to be on loan and lease growth, core deposit
growth and expense control."
FINANCIAL HIGHLIGHTS
|
At or For the
Three Months Ended |
At or For the
Year Ended |
|
December 31, |
September 30, |
|
December
31, |
|
|
2014 |
2014 |
Change |
2014 |
2013 |
Change |
|
(Dollars in thousands,
except per share data) |
Financial Highlights:
(1) |
|
|
|
|
|
|
Total Assets |
$ 16,234,800 |
$ 15,938,345 |
$ 296,455 |
$ 16,234,800 |
$ 6,533,363 |
$ 9,701,437 |
Loans and Leases, Net of Deferred
Fees |
$ 11,882,432 |
$ 11,574,885 |
$ 307,547 |
$ 11,882,432 |
$ 4,312,352 |
$ 7,570,080 |
Total Deposits |
$ 11,755,128 |
$ 11,523,437 |
$ 231,691 |
$ 11,755,128 |
$ 5,280,987 |
$ 6,474,141 |
|
|
|
|
|
|
|
Net Earnings |
$ 70,999 |
$ 62,271 |
$ 8,728 |
$ 168,905 |
$ 45,115 |
$ 123,790 |
Diluted Earnings Per Share |
$ 0.69 |
$ 0.60 |
$ 0.09 |
$ 1.92 |
$ 1.08 |
$ 0.84 |
Annualized Return on
Average Assets |
1.77% |
1.57% |
0.20 |
1.27% |
0.74% |
0.53 |
|
|
|
|
|
|
|
Adjusted Net Earnings (2) |
$ 68,200 |
$ 67,235 |
$ 965 |
$ 220,403 |
$ 77,466 |
$ 142,937 |
Adjusted Diluted Earnings Per Share
(2) |
$ 0.66 |
$ 0.65 |
$ 0.01 |
$ 2.50 |
$ 1.86 |
$ 0.64 |
Annualized Adjusted Return on Average
Assets (2) |
1.70% |
1.70% |
-- |
1.65% |
1.27% |
0.38 |
Annualized Return on Average Tangible
Equity (2) |
16.00% |
14.36% |
1.64 |
11.88% |
8.25% |
3.63 |
Annualized Adjusted Return on Average
Tangible Equity (2) |
15.37% |
15.50% |
(0.13) |
15.51% |
14.17% |
1.34 |
|
|
|
|
|
|
|
Noninterest-Bearing Deposits
as Percentage of Total Deposits |
25% |
25% |
-- |
25% |
44% |
(19) |
Core Deposits as a Percentage
of Total Deposits |
52% |
52% |
-- |
52% |
88% |
(36) |
Tangible Common Equity Ratio (2) |
12.20% |
12.24% |
(0.04) |
12.20% |
9.24% |
2.96 |
Tangible Book Value Per Share (2) |
$ 17.17 |
$ 16.86 |
$ 0.31 |
$ 17.17 |
$ 12.73 |
$ 4.44 |
Net Interest Margin |
5.86% |
5.78% |
0.08 |
5.95% |
5.37% |
0.58 |
Core Net Interest Margin (2) |
5.52% |
5.64% |
(0.12) |
5.60% |
5.29% |
0.31 |
Efficiency Ratio |
44.5% |
46.6% |
(2.1) |
58.0% |
76.4% |
(18.4) |
Adjusted Efficiency Ratio (2) |
42.3% |
43.4% |
(1.1) |
44.7% |
60.6% |
(15.9) |
Annualized Operating Expense as
Percentage of Average Assets |
2.00% |
2.09% |
(0.09) |
2.20% |
3.13% |
(0.93) |
|
|
|
|
|
|
|
(1) Includes the acquisition of
First California Financial Group, Inc. on May 31, 2013 and
CapitalSource Inc. on April 7, 2014. |
(2) Non-GAAP measure |
ADJUSTED NET EARNINGS
In evaluating its earnings, the Company removes certain items to
arrive at adjusted net earnings and adjusted diluted earnings per
share, as detailed below:
|
Three Months
Ended |
Year
Ended |
|
December 31, |
September 30, |
December 31, |
December
31, |
|
2014 |
2014 |
2013 |
2014 |
2013 |
|
(Dollars in
thousands) |
|
|
|
|
|
|
Reported net earnings |
$ 70,999 |
$ 62,271 |
$ 3,109 |
$ 168,905 |
$ 45,115 |
Less: Tax benefit on discontinued
operations |
(47) |
(3) |
(240) |
(1,114) |
(258) |
Add: Tax expense on continuing
operations |
42,226 |
42,205 |
9,135 |
113,853 |
30,003 |
Reported pre-tax earnings |
113,178 |
104,473 |
12,004 |
281,644 |
74,860 |
Add: Acquisition, integration, reorganization
and severance costs |
7,381 |
5,193 |
16,673 |
101,016 |
40,812 |
Less: FDIC loss sharing expense, net |
(4,360) |
(7,415) |
(10,593) |
(31,730) |
(26,172) |
Gain on sale of loans and leases |
7 |
973 |
683 |
601 |
1,791 |
(Loss) gain on securities |
-- |
-- |
(272) |
4,841 |
5,359 |
Covered OREO (expense) income, net |
(176) |
(452) |
594 |
1,172 |
1,833 |
Gain on sale of owned office
building |
-- |
-- |
-- |
1,570 |
-- |
Adjusted pre-tax earnings before
accelerated discount accretion |
125,088 |
116,560 |
38,265 |
406,206 |
132,861 |
Less: Accelerated discount accretion
resulting from payoffs of acquired loans |
11,421 |
4,501 |
1,434 |
38,867 |
4,393 |
Adjusted pre-tax earnings |
113,667 |
112,059 |
36,831 |
367,339 |
128,468 |
Tax expense (1) |
(45,467) |
(44,824) |
(14,622) |
(146,936) |
(51,002) |
Adjusted net earnings |
$ 68,200 |
$ 67,235 |
$ 22,209 |
$ 220,403 |
$ 77,466 |
|
|
|
|
|
|
Annualized adjusted return on average
assets |
1.70% |
1.70% |
1.33% |
1.65% |
1.27% |
|
|
|
|
|
|
Adjusted diluted earnings per share |
$ 0.66 |
$ 0.65 |
$ 0.49 |
$ 2.50 |
$ 1.86 |
|
|
|
|
|
|
(1) Effective tax rates of 40.0%
in 2014 periods and 39.7% in 2013 periods. |
INCOME STATEMENT HIGHLIGHTS
Net Interest Income
Net interest income increased $6.2 million to $195.0 million for
the fourth quarter of 2014 compared to $188.8 million for the third
quarter of 2014 due to higher accelerated discount accretion
resulting from early payoffs of acquired loans. Net interest margin
("NIM") for the fourth quarter of 2014 was 5.86% compared to 5.78%
for the third quarter of 2014, and loan yield was 6.76% compared to
6.68% for the third quarter of 2014. The increase in the NIM and
loan yield are both due to higher accelerated discount accretion
from early payoffs of acquired loans. Accelerated accretion
resulting from early payoffs of acquired loans was $11.4 million in
the fourth quarter (39 basis points on the loan and lease yield)
compared to $4.5 million in the third quarter (16 basis points on
the loan and lease yield), an increase of $6.9 million.
The total cost of deposits increased to 0.34% from 0.30% in the
prior quarter due primarily to a lower amount of premium accretion
on the time deposits acquired in the CapitalSource merger. The
outflow of maturing higher-rate time deposits, and the retention of
a portion of these deposits at current rates, resulted in the
decline in the weighted average contractual rate of time deposits
to 0.75% at December 31 from 0.80% at September 30.
Net interest margin information is presented in the following
table for the periods indicated:
|
Three Months
Ended |
|
December 31, |
September 30, |
Net Interest Margin |
2014 |
2014 |
|
(In
thousands) |
Average Assets: |
|
|
Loans and leases |
$ 11,586,573 |
$ 11,285,689 |
Investment securities |
1,591,839 |
1,584,811 |
Deposits in financial institutions |
26,971 |
99,276 |
Average interest-earning assets |
13,205,383 |
12,969,776 |
Other assets |
2,687,378 |
2,746,763 |
Average total assets |
$ 15,892,761 |
$ 15,716,539 |
|
|
|
Average Liabilities: |
|
|
Interest-bearing deposits |
$ 8,679,599 |
$ 8,778,642 |
Borrowings |
214,053 |
96,711 |
Subordinated debentures |
433,859 |
434,625 |
Average interest-bearing liabilities |
9,327,511 |
9,309,978 |
Noninterest-bearing demand deposits |
2,900,388 |
2,778,260 |
Other liabilities |
164,571 |
163,182 |
Average total liabilities |
12,392,470 |
12,251,420 |
Average stockholders' equity |
3,500,291 |
3,465,119 |
Average liabilities and stockholders'
equity |
$ 15,892,761 |
$ 15,716,539 |
|
|
|
Average time deposits |
$ 5,427,687 |
$ 5,680,732 |
Average total deposits |
$ 11,579,987 |
$ 11,556,902 |
Average funding sources |
$ 12,227,899 |
$ 12,088,238 |
|
|
|
Yield on: |
|
|
Average loans and leases |
6.76% |
6.68% |
Average investment securities |
3.04% |
3.09% |
Average interest-earning assets |
6.30% |
6.19% |
|
|
|
Cost of: |
|
|
Average total deposits |
0.34% |
0.30% |
Average time deposits |
0.60% |
0.51% |
Average interest-bearing deposits |
0.46% |
0.40% |
Average borrowings |
0.27% |
0.30% |
Average subordinated debentures |
4.20% |
4.21% |
Average interest-bearing liabilities |
0.63% |
0.58% |
Average funding sources |
0.48% |
0.44% |
|
|
|
Net interest rate
spread |
5.67% |
5.61% |
Net interest margin |
5.86% |
5.78% |
The NIM and loan and lease yield are impacted by volatility
caused by accelerated accretion of acquisition discounts resulting
from early payoffs of acquired loans. The effects of this item are
shown in the following table for the periods indicated:
|
Three Months
Ended |
Three Months
Ended |
|
December 31,
2014 |
September 30,
2014 |
|
|
Loan and |
|
Loan and |
|
NIM |
Lease Yield |
NIM |
Lease Yield |
Reported |
5.86% |
6.76% |
5.78% |
6.68% |
Less: Accelerated accretion of acquisition
discounts resulting from acquired loan payoffs |
(0.34)% |
(0.39)% |
(0.14)% |
(0.16)% |
Core (non-GAAP measure) |
5.52% |
6.37% |
5.64% |
6.52% |
The impact on the NIM from all purchase accounting items is
detailed in the table below for the period indicated:
|
Three Months
Ended |
Three Months
Ended |
|
December 31,
2014 |
September 30,
2014 |
|
|
Impact on |
|
Impact on |
|
Amount |
NIM |
Amount |
NIM |
|
(Dollars in
thousands) |
Net interest income/NIM as reported |
$ 194,983 |
5.86% |
$ 188,846 |
5.78% |
Less: Accelerated accretion of acquisition
discounts from early acquired loan payoffs |
(11,421) |
(0.34)% |
(4,501) |
(0.14)% |
Remaining accretion of Non-PCI
loan acquisition discounts |
(13,073) |
(0.39)% |
(15,072) |
(0.46)% |
Amortization of TruPS discount |
1,401 |
0.04% |
1,402 |
0.04% |
Accretion of time deposits premium |
(2,469) |
(0.07)% |
(5,081) |
(0.16)% |
|
(25,562) |
(0.76)% |
(23,252) |
(0.72)% |
Net interest income/NIM excluding purchase
accounting |
$ 169,421 |
5.10% |
$ 165,594 |
5.06% |
Noninterest Income
Noninterest income decreased by $3.6 million to $12.7 million
for the fourth quarter of 2014 compared to $16.3 million for the
third quarter of 2014 due mostly to lower other commissions and
fees, lower dividends and gains on equity investments and lower
foreign currency translation net gains, offset by lower FDIC loss
sharing expense. The decrease in other commissions and fees is
due to lower prepayment fees and other loan-related fees. Dividends
and gains on equity investments and foreign currency translation
net gains tend to fluctuate from period to period based upon
dividends received, sales of equity investments and the movement of
the U.S. Dollar against various foreign currencies. FDIC loss
sharing expense decreased $3.1 million due mostly to lower
amortization of the FDIC loss sharing asset as one of the Bank's
loss sharing agreements reached the end of its initial
indemnification period during the previous quarter.
The following table presents details of noninterest income for
the periods indicated:
|
Three Months
Ended |
|
December 31, |
September 30, |
Increase |
Noninterest Income |
2014 |
2014 |
(Decrease) |
|
(In
thousands) |
|
|
|
|
Service charges on deposit accounts |
$ 2,787 |
$ 2,725 |
$ 62 |
Other commissions and fees |
4,556 |
6,371 |
(1,815) |
Leased equipment income |
5,382 |
5,615 |
(233) |
Gain on sale of loans and leases |
7 |
973 |
(966) |
FDIC loss sharing expense, net |
(4,360) |
(7,415) |
3,055 |
Other income: |
|
|
|
Dividends and realized gains on equity
investments |
1,924 |
3,625 |
(1,701) |
Foreign currency translation net
gains |
854 |
2,253 |
(1,399) |
Income recognized on early repayment of
leases |
294 |
510 |
(216) |
Other |
1,259 |
1,657 |
(398) |
Total noninterest income |
$ 12,703 |
$ 16,314 |
$ (3,611) |
The following table presents the details of FDIC loss sharing
expense for the periods indicated:
|
Three Months
Ended |
|
December 31, |
September 30, |
Increase |
FDIC Loss Sharing Expense,
Net |
2014 |
2014 |
(Decrease) |
|
(In
thousands) |
|
|
|
|
Loss on FDIC loss sharing asset |
$ (525) |
$ (1,735) |
$ 1,210 |
FDIC loss sharing asset amortization,
net |
(3,795) |
(6,074) |
2,279 |
Net reimbursement from FDIC for covered
OREOs |
63 |
491 |
(428) |
Other |
(103) |
(97) |
(6) |
FDIC loss sharing expense, net |
$ (4,360) |
$ (7,415) |
$ 3,055 |
Noninterest Expense
Noninterest expense decreased by $3.3 million to $92.3 million
for the fourth quarter of 2014 compared to $95.6 million for the
third quarter of 2014. The decrease was due mostly to lower
foreclosed assets expense of $2.9 million and lower operating
expenses of $2.7 million, offset by higher acquisition,
integration, reorganization and severance costs of $2.2
million. The decrease in foreclosed assets expense was mostly
due to lower write-downs on existing properties.
Operating expenses decreased to $79.9 million for the fourth
quarter of 2014 compared to $82.6 million for the third quarter of
2014 due to decreases in other expenses and other professional
services. Other expenses decreased due to lower loan-related
expenses related to origination and work-out activities and the
prior quarter included an accrual for loan-related litigation.
Other professional services decreased due to lower legal and
consulting expenses.
The following table presents details of noninterest expense for
the periods indicated:
|
Three Months
Ended |
|
December 31, |
September 30, |
Increase |
Noninterest Expense |
2014 |
2014 |
(Decrease) |
|
(In
thousands) |
|
|
|
|
Compensation |
$ 45,930 |
$ 45,861 |
$ 69 |
Occupancy |
10,745 |
11,188 |
(443) |
Data processing |
4,050 |
3,929 |
121 |
Other professional services |
3,181 |
3,687 |
(506) |
Insurance and assessments |
3,115 |
3,020 |
95 |
Intangible asset amortization |
1,619 |
1,608 |
11 |
Other expense: |
|
|
|
Loan expense |
2,365 |
3,711 |
(1,346) |
Communications |
1,141 |
1,369 |
(228) |
Other |
7,772 |
8,275 |
(503) |
Total operating expense |
79,918 |
82,648 |
(2,730) |
Leased equipment depreciation |
3,103 |
2,961 |
142 |
Foreclosed assets expense, net |
1,938 |
4,827 |
(2,889) |
Acquisition, integration, reorganization and
severance costs |
7,381 |
5,193 |
2,188 |
Total noninterest expense |
$ 92,340 |
$ 95,629 |
$ (3,289) |
Income Taxes
Our overall effective income tax rate was 37.3% for the fourth
quarter of 2014 and 40.4% for the third quarter of 2014.
BALANCE SHEET HIGHLIGHTS
Loans and Leases
Total loans and leases increased $307.5 million in the fourth
quarter to $11.9 billion at December 31, 2014. The loan and lease
growth in the fourth quarter represents an annualized growth rate
of 11%.
The following table presents a roll forward of the loan and
lease portfolio for the periods indicated:
|
Three Months
Ended |
|
December 31, |
September 30, |
Loan and Lease Roll Forward
(1) |
2014 |
2014 |
|
(In
thousands) |
|
|
|
Beginning balance |
$ 11,574,885 |
$ 11,190,105 |
Loans and leases originated and
purchased |
950,385 |
974,658 |
Existing loans and leases: |
|
|
Principal repayments, net (2) |
(620,799) |
(535,758) |
Loan and lease sales |
(6,388) |
(13,039) |
Transfers to loans held for sale |
-- |
(33,125) |
Transfers to foreclosed assets |
(9,139) |
-- |
Charge-offs |
(6,512) |
(7,956) |
Ending balance |
$ 11,882,432 |
$ 11,574,885 |
|
|
|
(1) Includes direct financing
leases but excludes equipment leased to others under operating
leases. |
(2) Includes principal repayments
on existing loans, changes in revolving lines of credit (repayments
and draws) and other changes within the loan portfolio. |
The following table presents a roll forward of the loan and
lease portfolio by segment for the period indicated:
|
Three Months
Ended December 31, 2014 |
|
Community |
National |
|
Loan and Lease Roll Forward by
Segment |
Banking |
Lending |
Total |
|
(In
thousands) |
|
|
|
|
Beginning balance |
$ 3,482,125 |
$ 8,092,760 |
$ 11,574,885 |
Loans and leases originated and
purchased |
121,817 |
828,568 |
950,385 |
Existing loans and leases: |
|
|
|
Principal repayments, net |
(181,219) |
(439,580) |
(620,799) |
Loan and lease sales |
(6,246) |
(142) |
(6,388) |
Transfers to foreclosed assets |
(9,139) |
-- |
(9,139) |
Charge-offs |
(6,209) |
(303) |
(6,512) |
Ending balance |
$ 3,401,129 |
$ 8,481,303 |
$ 11,882,432 |
|
|
|
|
Weighted average rate on originations |
5.09% |
5.76% |
5.67% |
The following table presents the composition of our loan and
lease portfolio as of the dates indicated:
|
December 31, |
September 30, |
Loan and Lease
Portfolio |
2014 |
2014 |
|
(In
thousands) |
Real estate mortgage: |
|
|
Hospitality |
$ 570,634 |
$ 530,628 |
SBA |
380,890 |
357,923 |
Commercial real estate |
2,428,794 |
2,492,883 |
Healthcare real estate |
1,030,851 |
1,006,164 |
Multi-family |
774,710 |
811,234 |
Other |
411,123 |
514,283 |
Total real estate
mortgage |
5,597,002 |
5,713,115 |
Real estate
construction: |
|
|
Residential |
96,749 |
72,881 |
Commercial |
217,297 |
218,389 |
Total real estate
construction |
314,046 |
291,270 |
Commercial: |
|
|
Collateralized |
439,567 |
429,011 |
Unsecured |
131,939 |
127,150 |
Asset-based |
1,794,907 |
1,594,488 |
Cash flow |
2,486,411 |
2,341,511 |
Equipment finance |
969,489 |
928,460 |
SBA |
47,304 |
41,129 |
Total commercial |
5,869,617 |
5,461,749 |
Consumer |
101,767 |
108,751 |
Total loans and leases, net of
deferred fees |
$ 11,882,432 |
$ 11,574,885 |
Energy-Related Credit Exposure
At December 31, 2014, we had 45 outstanding loan and lease
relationships totaling $288.0 million to borrowers broadly involved
in the energy industry. The obligors under these loans and leases
either conduct mining, quarrying, oil and gas extraction or provide
industrial support services to such types of businesses. The
collateral for these loans and leases primarily includes equipment,
such as drilling and mining equipment and transportation vehicles,
used directly and indirectly in these activities. At December 31,
2014, four of these loans totaling $6.8 million were on nonaccrual
status. These loans and leases are subject to our normal review
procedures and allowance for credit losses methodology.
Deposits
The following table presents the composition of our deposit
portfolio as of the dates indicated:
|
December 31,
2014 |
September 30,
2014 |
|
|
% of |
|
% of |
Deposit Category |
Amount |
Total |
Amount |
Total |
|
(Dollars in
thousands) |
|
|
|
|
|
Noninterest-bearing demand deposits |
$ 2,931,352 |
25% |
$ 2,842,488 |
25% |
Interest checking deposits |
732,196 |
6% |
683,014 |
6% |
Money market deposits |
1,709,068 |
15% |
1,721,563 |
15% |
Savings deposits |
762,961 |
6% |
759,893 |
6% |
Total core deposits |
6,135,577 |
52% |
6,006,958 |
52% |
Brokered non-maturity deposits |
120,613 |
1% |
-- |
-- |
Total non-maturity deposits |
6,256,190 |
53% |
6,006,958 |
52% |
Time deposits under $100,000 |
2,467,338 |
21% |
2,267,013 |
20% |
Time deposits of $100,000 and over |
3,031,600 |
26% |
3,249,466 |
28% |
Total time deposits |
5,498,938 |
47% |
5,516,479 |
48% |
Total deposits |
$ 11,755,128 |
100% |
$ 11,523,437 |
100% |
At December 31, 2014, core deposits totaled $6.1 billion, or 52%
of total deposits, and noninterest-bearing demand deposits, which
totaled $2.9 billion, were 25% of total deposits. Core
deposits obtained from CapitalSource Division borrowers totaled
$264.8 million at December 31, 2014, of which $246.1 million were
noninterest-bearing.
The following table summarizes the maturities of our time
deposits as of the date indicated:
|
December 31,
2014 |
|
Time Deposits |
Time Deposits |
Total |
|
Estimated |
|
Under |
$100,000 |
Time |
Contractual |
Effective |
Time Deposit Maturities |
$100,000 |
or More |
Deposits |
Rate |
Rate |
|
(Dollars in
thousands) |
|
|
|
|
|
|
Due in three months or less |
$ 618,024 |
$ 767,160 |
$ 1,385,184 |
0.70% |
0.61% |
Due in over three months through six
months |
608,290 |
700,199 |
1,308,489 |
0.70% |
0.64% |
Due in over six months through twelve
months |
1,007,390 |
1,257,397 |
2,264,787 |
0.75% |
0.71% |
Due in over 12 months through 24 months |
176,125 |
248,533 |
424,658 |
1.01% |
0.88% |
Due in over 24 months |
57,509 |
58,311 |
115,820 |
0.95% |
0.70% |
Total |
$ 2,467,338 |
$ 3,031,600 |
$ 5,498,938 |
0.75% |
0.69% |
|
|
|
|
|
|
At September 30, 2014 |
$ 2,267,013 |
$ 3,249,466 |
$ 5,516,479 |
0.80% |
0.69% |
The remaining purchase accounting premium on acquired
CapitalSource time deposits was $3.6 million at December 31, 2014
with a weighted average life of 15 months.
PROVISION AND ALLOWANCE FOR CREDIT LOSSES
We made a provision for credit losses of $2.1 million in the
fourth quarter of 2014 and $5.1 million in the third quarter of
2014 in accordance with our loan methodology, which takes into
consideration new loan and lease fundings, commitments to make
loans and leases, and underlying credit quality trends. The
fourth quarter provision is comprised of $2.7 million for Non-PCI
loans and a negative provision of $0.6 million for PCI
loans. The negative provision for PCI loans results from
increases in expected cash flows on such loans, which have a net
carrying value of $290.9 million at December 31.
The following tables show roll forwards of the allowance for
credit losses for the third and fourth quarters:
|
Three Months
Ended September 30, 2014 |
|
Non-PCI |
|
|
|
|
Allowance for
Credit |
Loans and |
Unfunded |
Total |
PCI |
|
Losses Rollforward |
Leases |
Commitments |
Non-PCI |
Loans |
Total |
|
(In
thousands) |
|
|
|
|
|
|
Beginning balance |
$ 65,523 |
$ 6,844 |
$ 72,367 |
$ 16,626 |
$ 88,993 |
Charge-offs |
(7,848) |
-- |
(7,848) |
(108) |
(7,956) |
Recoveries |
1,725 |
-- |
1,725 |
-- |
1,725 |
Net charge-offs |
(6,123) |
-- |
(6,123) |
(108) |
(6,231) |
Provision (negative provision) |
3,684 |
(931) |
2,753 |
2,297 |
5,050 |
Ending balance |
$ 63,084 |
$ 5,913 |
$ 68,997 |
$ 18,815 |
$ 87,812 |
|
|
|
|
|
|
|
Three Months
Ended December 31, 2014 |
|
Non-PCI |
|
|
|
|
Allowance for
Credit |
Loans and |
Unfunded |
Total |
PCI |
|
Losses Rollforward |
Leases |
Commitments |
Non-PCI |
Loans |
Total |
|
(In
thousands) |
|
|
|
|
|
|
Beginning balance |
$ 63,084 |
$ 5,913 |
$ 68,997 |
$ 18,815 |
$ 87,812 |
Charge-offs |
(1,647) |
-- |
(1,647) |
(4,865) |
(6,512) |
Recoveries |
6,688 |
-- |
6,688 |
715 |
7,403 |
Net (charge-offs) recoveries |
5,041 |
-- |
5,041 |
(4,150) |
891 |
Provision (negative provision) |
2,331 |
398 |
2,729 |
(666) |
2,063 |
Ending balance |
$ 70,456 |
$ 6,311 |
$ 76,767 |
$ 13,999 |
$ 90,766 |
Non-PCI loans and leases include $5.0 billion of originated
loans and leases that were not obtained through acquisitions. The
allowance related to these loans and leases totals $66.3 million,
or 1.31% of the outstanding balance.
All acquired loans are recorded initially at their estimated
fair value with such initial fair value including an estimate of
credit losses. The two additional credit coverage ratios shown in
the table below are presented to give an indication of overall
credit risk coverage:
|
December 31,
2014 |
September 30,
2014 |
|
Non-PCI |
|
|
Non-PCI |
|
|
Credit Risk Coverage
Ratios |
Loans and |
Allowance/ |
Coverage |
Loans and |
Allowance/ |
Coverage |
(Excludes PCI Loans) |
Leases |
Discount |
Ratio |
Leases |
Discount |
Ratio |
|
(Dollars in
thousands) |
|
|
|
|
|
|
|
Ending balance |
$ 11,605,056 |
$ 76,767 |
0.66% |
$ 11,239,964 |
$ 68,997 |
0.61% |
Acquired loans |
(6,562,267) |
(4,184) |
(1) |
(7,039,518) |
(3,038) |
(1) |
Adjusted balance |
$ 5,042,789 |
$ 72,583 |
1.44% |
$ 4,200,446 |
$ 65,959 |
1.57% |
|
|
|
|
|
|
|
Ending balance |
$ 11,605,056 |
$ 76,767 |
0.66% |
$ 11,239,964 |
$ 68,997 |
0.61% |
Unamortized net discount |
156,428 |
156,428 |
(2) |
179,424 |
179,424 |
(2) |
Adjusted balance |
$ 11,761,484 |
$ 233,195 |
1.98% |
$ 11,419,388 |
$ 248,421 |
2.18% |
|
|
|
|
|
|
|
(1) Allowance attributed to $6.6
billion and $7.0 billion of acquired Non-PCI loans at December 31,
2014 and September 30, 2014, based on the allowance calculation
that includes an amount for credit deterioration on acquired loans
and leases since their acquisition dates. |
(2) Unamortized net discount
relates to $6.6 billion and $7.0 billion of acquired Non-PCI loans
at December 31, 2014 and September 30, 2014, and is assigned
specifically to those loans only. Such discount represents the
acquisition date fair value adjustment based on market, liquidity,
and interest rate risk in addition to credit risk and is being
accreted to interest income over the remaining life of the
respective loans. |
The decrease in coverage ratios results from the
combination of newly originated loans being provided for at a
rate lower than the current coverage ratio and normal and
accelerated accretion of unamortized discount.
CREDIT QUALITY
The following table presents our Non-PCI loan and lease credit
quality metrics as of the dates indicated:
|
December 31, |
September 30, |
Non-PCI Credit Quality
Metrics |
2014 |
2014 |
|
(Dollars in
thousands) |
|
|
|
Allowance for credit losses |
$ 76,767 |
$ 68,997 |
Nonaccrual loans and leases (1) |
83,621 |
88,948 |
Classified loans and leases (2) |
242,611 |
260,986 |
Performing restructured loans |
35,244 |
34,308 |
Net charge-offs (recoveries) (for the
quarter) |
(5,041) |
6,123 |
Provision for credit losses (for the
quarter) |
2,729 |
2,753 |
Allowance for credit losses to loans and
leases |
0.66% |
0.61% |
Allowance for credit losses to nonaccrual
loans and leases |
91.8% |
77.6% |
Nonperforming assets to loans and leases and
foreclosed assets |
1.09% |
1.15% |
Classified loans and leases to loans and
leases |
2.09% |
2.32% |
|
|
|
(1) At December 31, 2014 and
September 30, 2014, includes $22,899 and $24,465, respectively, of
acquired loans and leases with no allowance due to fair value
accounting. |
(2) Classified loans and leases
are those with a credit risk rating of substandard or
doubtful. |
The following table presents our Non-PCI nonaccrual loans and
leases and accruing loans and leases past due between 30 and 89
days by portfolio segment and class as of the dates indicated:
|
Nonaccrual Loans
and Leases |
Accruing
and |
|
December 31,
2014 |
|
September 30,
2014 |
30-89 Days Past
Due |
|
|
% of |
|
|
% of |
December 31, |
September 30, |
|
|
Loan |
|
|
Loan |
2014 |
2014 |
|
Balance |
Category |
|
Balance |
Category |
Balance |
Balance |
|
(Dollars in
thousands) |
Real estate mortgage: |
|
|
|
|
|
|
|
|
|
Hospitality |
$ 6,366 |
|
1% |
|
$ 6,451 |
|
1% |
$ -- |
$ -- |
SBA |
11,141 |
|
3% |
|
7,483 |
|
2% |
3,339 |
529 |
Other |
20,105 |
|
-- |
|
26,575 |
|
1% |
4,769 |
4,014 |
Total real estate mortgage |
37,612 |
|
1% |
|
40,509 |
|
1% |
8,108 |
4,543 |
Real estate construction: |
|
|
|
|
|
|
|
|
|
Residential |
381 |
|
-- |
|
925 |
|
1% |
-- |
-- |
Commercial |
1,178 |
|
1% |
|
2,703 |
|
1% |
-- |
1,190 |
Total real estate construction |
1,559 |
|
1% |
|
3,628 |
|
1% |
-- |
1,190 |
Commercial: |
|
|
|
|
|
|
|
|
|
Collateralized |
5,450 |
|
1% |
|
5,165 |
|
1% |
93 |
-- |
Unsecured |
639 |
|
-- |
|
226 |
|
-- |
69 |
1 |
Asset-based |
4,574 |
|
-- |
|
5,003 |
|
-- |
-- |
-- |
Cash flow |
15,964 |
|
1% |
|
15,958 |
|
1% |
-- |
-- |
Equipment finance |
11,131 |
|
1% |
|
12,885 |
|
1% |
2,339 |
-- |
SBA |
3,207 |
|
7% |
|
2,039 |
|
5% |
26 |
-- |
Total commercial |
40,965 |
|
1% |
|
41,276 |
|
1% |
2,527 |
1 |
Consumer |
3,485 |
|
3% |
|
3,535 |
|
3% |
50 |
165 |
Total Non-PCI loans and leases |
$ 83,621 |
(1) |
1% |
|
$ 88,948 |
(1) |
1% |
$ 10,685 |
$ 5,899 |
|
|
|
|
|
|
|
|
|
|
(1) Includes leases to companies
involved in the energy industry of $6.8 million and $8.5 million at
December 31 and September 30, 2014, respectively. There were no
energy-related leases accruing and 30-89 days past due. |
The following table presents our nonperforming assets as of the
dates indicated:
|
December 31, |
September 30, |
Nonperforming Assets |
2014 |
2014 |
|
(Dollars in
thousands) |
|
|
|
Nonaccrual Non-PCI loans and leases |
$ 83,621 |
$ 88,948 |
Nonaccrual PCI Loans(1) |
25,264 |
27,670 |
Total nonaccrual loans and leases |
108,885 |
116,618 |
Foreclosed assets, net |
43,721 |
40,524 |
Total nonperforming assets |
$ 152,606 |
$ 157,142 |
|
|
|
Nonperforming assets to loans and leases and
foreclosed assets |
1.28% |
1.35% |
|
|
|
(1) Represents legacy
CapitalSource borrowing relationships placed on nonaccrual status
as of the acquisition date. |
PCI loans, regardless of the underlying payment status of the
borrower, are generally considered accruing and performing when
reasonably estimable cash flows support the carrying amount of the
loans. As of December 31, 2014, there are $25.3 million of PCI
loans on nonaccrual status and included in the table above as the
timing and amount of future cash flows is not reasonably
estimable.
ABOUT PACWEST BANCORP
PacWest Bancorp is a bank holding company with over $16 billion
in assets with one wholly-owned banking subsidiary, Pacific Western
Bank ("Pacific Western"). Through 80 full-service branches located
throughout the state of California, Pacific Western provides
commercial banking services, including real estate, construction,
and commercial loans, to small and medium-sized businesses. Its
CapitalSource and Community Banking divisions, and its subsidiary
CapitalSource Business Finance Group (formerly known as BFI
Business Finance), deliver the full spectrum of financing solutions
nationwide across numerous industries and property types. For more
information about PacWest Bancorp, visit www.pacwestbancorp.com, or
to learn more about Pacific Western Bank, visit
www.pacificwesternbank.com.
FORWARD LOOKING STATEMENTS
This release contains certain "forward-looking statements" about
the Company and its subsidiaries within the meaning of the Private
Securities Litigation Reform Act of 1995, including certain plans,
strategies, goals, and projections and including statements about
our expectations regarding our loan and lease portfolio growth and
production, deposit growth, and operating expenses. All statements
contained in this release that are not clearly historical in nature
are forward-looking, and the words "anticipate," "assume,"
"intend," "believe," "forecast," "expect," "estimate," "plan,"
"continue," "will," "should," "look forward" and similar
expressions are generally intended to identify forward-looking
statements. All forward-looking statements (including statements
regarding future financial and operating results and future
transactions and their results) involve risks, uncertainties and
contingencies, many of which are beyond our control, which may
cause actual results, performance, or achievements to differ
materially from anticipated results, performance or achievements.
Actual results could differ materially from those contained or
implied by such forward-looking statements for a variety of
factors, including without limitation:
- changes in economic or competitive market conditions could
negatively impact investment or lending opportunities or product
pricing and services;
- legislative or regulatory requirements or changes adversely
affected the Company's business, including an increase to capital
requirements;
- loan repayments higher than expected;
- reduced demand for our services due to strategic or regulatory
reasons;
- our inability to grow deposits and access wholesale funding
sources;
- higher than anticipated increases in operating expenses;
- increased litigation;
- higher asset workout or loan servicing expenses;
- higher compensation costs and professional fees to retain
and/or incent employees; and
- other risk factors described in documents filed by PacWest with
the U.S. Securities and Exchange Commission ("SEC").
All forward-looking statements included in this release are
based on information available at the time of the release. We are
under no obligation to (and expressly disclaim any such obligation
to) update or alter our forward-looking statements, whether as a
result of new information, future events or otherwise except as
required by law.
PACWEST BANCORP AND
SUBSIDIARIES |
CONDENSED CONSOLIDATED
BALANCE SHEET |
|
|
|
|
|
December 31, |
September 30, |
December 31, |
|
2014 |
2014 |
2013 |
|
(Dollars in thousands,
except per share data) |
ASSETS: |
|
|
|
Cash and due from banks |
$ 164,757 |
$ 145,463 |
$ 96,424 |
Interest-earning deposits in financial
institutions |
148,469 |
115,399 |
50,998 |
Total cash and cash
equivalents |
313,226 |
260,862 |
147,422 |
|
|
|
|
Securities available-for-sale, at estimated
fair value |
1,567,177 |
1,539,681 |
1,494,745 |
Federal Home Loan Bank stock, at cost |
40,609 |
45,602 |
27,939 |
Total investment
securities |
1,607,786 |
1,585,283 |
1,522,684 |
|
|
|
|
Non-PCI loans and leases |
11,613,832 |
11,239,964 |
3,930,539 |
PCI loans |
290,852 |
351,431 |
382,796 |
Total gross loans and leases |
11,904,684 |
11,591,395 |
4,313,335 |
Deferred fees and costs |
(22,252) |
(16,510) |
(983) |
Total loans and leases, net of deferred
fees |
11,882,432 |
11,574,885 |
4,312,352 |
Allowance for loan and lease losses |
(84,455) |
(81,899) |
(82,034) |
Total loans and leases,
net |
11,797,977 |
11,492,986 |
4,230,318 |
|
|
|
|
Equipment leased to others under operating
leases |
122,506 |
125,119 |
-- |
Premises and equipment, net |
36,551 |
38,368 |
32,435 |
Foreclosed assets, net |
43,721 |
40,524 |
55,891 |
FDIC loss sharing asset |
18,734 |
22,977 |
45,524 |
Deferred tax asset, net |
284,411 |
331,176 |
79,636 |
Goodwill |
1,720,479 |
1,722,129 |
208,743 |
Core deposit and customer relationship
intangibles, net |
17,204 |
18,822 |
17,248 |
Other assets |
272,205 |
300,099 |
193,462 |
Total assets |
$ 16,234,800 |
$ 15,938,345 |
$ 6,533,363 |
|
|
|
|
LIABILITIES: |
|
|
|
Noninterest-bearing deposits |
$ 2,931,352 |
$ 2,842,488 |
$ 2,318,446 |
Interest-bearing deposits |
8,823,776 |
8,680,949 |
2,962,541 |
Total deposits |
11,755,128 |
11,523,437 |
5,280,987 |
Borrowings |
383,402 |
363,672 |
113,726 |
Subordinated debentures |
433,583 |
433,545 |
132,645 |
Accrued interest payable and other
liabilities |
156,262 |
139,445 |
196,912 |
Total liabilities |
12,728,375 |
12,460,099 |
5,724,270 |
|
|
|
|
STOCKHOLDERS' EQUITY
(1) |
3,506,425 |
3,478,246 |
809,093 |
Total liabilities and
shareholders' equity |
$ 16,234,800 |
$ 15,938,345 |
$ 6,533,363 |
|
|
|
|
(1) Includes net unrealized gain (loss) on
securities available-for-sale, net |
$ 26,380 |
$ 20,821 |
$ (3,347) |
|
|
|
|
Book value per share |
$ 34.04 |
$ 33.76 |
$ 17.66 |
Tangible book value per share |
$ 17.17 |
$ 16.86 |
$ 12.73 |
|
|
|
|
Shares outstanding (includes unvested
restricted shares of 1,108,505 at December 31, 2014, 1,115,550
at September 30, 2014 and 1,216,524 at December 31, 2013) |
103,022,017 |
103,027,830 |
45,822,834 |
|
PACWEST BANCORP AND
SUBSIDIARIES |
CONDENSED CONSOLIDATED
STATEMENT OF EARNINGS |
|
|
|
|
|
|
|
Three Months
Ended |
Year
Ended |
|
December 31, |
September 30, |
December 31, |
December
31, |
|
2014 |
2014 |
2013 |
2014 |
2013 |
|
(Dollars in thousands,
except per share data) |
Interest income: |
|
|
|
|
|
Loans and leases |
$ 197,472 |
$ 189,961 |
$ 73,352 |
$ 657,097 |
$ 272,726 |
Investment securities |
12,205 |
12,331 |
10,422 |
47,345 |
36,923 |
Deposits in financial institutions |
19 |
64 |
82 |
333 |
265 |
Total interest
income |
209,696 |
202,356 |
83,856 |
704,775 |
309,914 |
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
Deposits |
9,972 |
8,822 |
1,450 |
27,332 |
7,868 |
Borrowings |
144 |
74 |
86 |
496 |
537 |
Subordinated debentures |
4,597 |
4,614 |
1,062 |
14,570 |
3,796 |
Total interest
expense |
14,713 |
13,510 |
2,598 |
42,398 |
12,201 |
|
|
|
|
|
|
Net interest income |
194,983 |
188,846 |
81,258 |
662,377 |
297,713 |
Provision (negative provision) for credit
losses |
2,063 |
5,050 |
(1,338) |
11,499 |
(4,210) |
Net interest income after
provision for credit losses |
192,920 |
183,796 |
82,596 |
650,878 |
301,923 |
|
|
|
|
|
|
Noninterest income: |
|
|
|
|
|
Service charges on deposit accounts |
2,787 |
2,725 |
3,197 |
11,233 |
11,765 |
Other commissions and fees |
4,556 |
6,371 |
2,125 |
18,602 |
8,416 |
Leased equipment income |
5,382 |
5,615 |
-- |
16,669 |
-- |
Gain on sale of loans and leases |
7 |
973 |
683 |
601 |
1,791 |
(Loss) gain on securities |
-- |
-- |
(272) |
4,841 |
5,359 |
FDIC loss sharing expense, net |
(4,360) |
(7,415) |
(10,593) |
(31,730) |
(26,172) |
Other income |
4,331 |
8,045 |
934 |
21,971 |
3,085 |
Total noninterest
income |
12,703 |
16,314 |
(3,926) |
42,187 |
4,244 |
|
|
|
|
|
|
Noninterest expense: |
|
|
|
|
|
Compensation |
45,930 |
45,861 |
27,697 |
165,499 |
107,067 |
Occupancy |
10,745 |
11,188 |
7,553 |
40,606 |
29,459 |
Data processing |
4,050 |
3,929 |
2,216 |
14,618 |
9,494 |
Other professional services |
3,181 |
3,687 |
1,770 |
11,234 |
6,754 |
Insurance and assessments |
3,115 |
3,020 |
1,572 |
10,907 |
5,596 |
Intangible asset amortization |
1,619 |
1,608 |
1,430 |
6,268 |
5,402 |
Other expenses |
11,278 |
13,355 |
7,746 |
44,036 |
27,606 |
Total operating
expense |
79,918 |
82,648 |
49,984 |
293,168 |
191,378 |
Leased equipment depreciation |
3,103 |
2,961 |
-- |
9,159 |
-- |
Foreclosed assets expense (income), net |
1,938 |
4,827 |
(569) |
5,401 |
(1,503) |
Acquisition, integration, reorganization and
severance costs |
7,381 |
5,193 |
16,673 |
101,016 |
40,812 |
Total noninterest
expense |
92,340 |
95,629 |
66,088 |
408,744 |
230,687 |
|
|
|
|
|
|
Earnings from continuing operations before
taxes |
113,283 |
104,481 |
12,582 |
284,321 |
75,480 |
Income tax expense |
(42,226) |
(42,205) |
(9,135) |
(113,853) |
(30,003) |
Net earnings from continuing
operations |
71,057 |
62,276 |
3,447 |
170,468 |
45,477 |
|
|
|
|
|
|
Loss from discontinued operations before
taxes |
(105) |
(8) |
(578) |
(2,677) |
(620) |
Income tax benefit |
47 |
3 |
240 |
1,114 |
258 |
Net loss from discontinued
operations |
(58) |
(5) |
(338) |
(1,563) |
(362) |
|
|
|
|
|
|
Net earnings |
$ 70,999 |
$ 62,271 |
$ 3,109 |
$ 168,905 |
$ 45,115 |
|
|
|
|
|
|
Basic and diluted earnings per
share: |
|
|
|
|
|
Net earnings from continuing
operations |
$ 0.69 |
$ 0.60 |
$ 0.07 |
$ 1.94 |
$ 1.09 |
Net earnings |
$ 0.69 |
$ 0.60 |
$ 0.06 |
$ 1.92 |
$ 1.08 |
|
PACWEST BANCORP AND
SUBSIDIARIES |
AVERAGE BALANCE SHEET
AND YIELD ANALYSIS |
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
December 31,
2014 |
September 30,
2014 |
December 31,
2013 |
|
|
Interest |
Average |
|
Interest |
Average |
|
Interest |
Average |
|
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
|
Balance |
Expense |
Cost |
Balance |
Expense |
Cost |
Balance |
Expense |
Cost |
|
(Dollars in
thousands) |
Assets: |
|
|
|
|
|
|
|
|
|
PCI loans |
$ 311,061 |
$ 11,247 |
14.34% |
$ 363,049 |
$ 13,490 |
14.74% |
$ 384,727 |
$ 12,754 |
13.15% |
Non-PCI loans and leases |
11,275,512 |
186,225 |
6.55% |
10,922,640 |
176,471 |
6.41% |
3,916,650 |
60,598 |
6.14% |
Total loans and leases |
11,586,573 |
197,472 |
6.76% |
11,285,689 |
189,961 |
6.68% |
4,301,377 |
73,352 |
6.77% |
Investment securities (1) |
1,591,839 |
12,205 |
3.04% |
1,584,811 |
12,331 |
3.09% |
1,531,335 |
10,422 |
2.70% |
Deposits in financial institutions |
26,971 |
19 |
0.28% |
99,276 |
64 |
0.26% |
129,716 |
82 |
0.25% |
Total interest-earning assets |
13,205,383 |
209,696 |
6.30% |
12,969,776 |
202,356 |
6.19% |
5,962,428 |
83,856 |
5.58% |
Other assets |
2,687,378 |
|
|
2,746,763 |
|
|
670,302 |
|
|
Total assets |
$ 15,892,761 |
|
|
$ 15,716,539 |
|
|
$ 6,632,730 |
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders'
Equity: |
|
|
|
|
|
|
|
|
|
Interest checking |
$ 702,498 |
194 |
0.11% |
$ 605,288 |
86 |
0.06% |
$ 627,256 |
83 |
0.05% |
Money market |
1,788,341 |
932 |
0.21% |
1,733,445 |
908 |
0.21% |
1,512,369 |
654 |
0.17% |
Savings |
761,073 |
572 |
0.30% |
759,177 |
575 |
0.30% |
220,331 |
14 |
0.03% |
Time |
5,427,687 |
8,274 |
0.60% |
5,680,732 |
7,253 |
0.51% |
694,924 |
699 |
0.40% |
Total interest-bearing deposits |
8,679,599 |
9,972 |
0.46% |
8,778,642 |
8,822 |
0.40% |
3,054,880 |
1,450 |
0.19% |
Borrowings |
214,053 |
144 |
0.27% |
96,711 |
74 |
0.30% |
9,861 |
86 |
3.46% |
Subordinated debentures |
433,859 |
4,597 |
4.20% |
434,625 |
4,614 |
4.21% |
132,560 |
1,062 |
3.18% |
Total interest-bearing liabilities |
9,327,511 |
14,713 |
0.63% |
9,309,978 |
13,510 |
0.58% |
3,197,301 |
2,598 |
0.32% |
Noninterest-bearing demand deposits |
2,900,388 |
|
|
2,778,260 |
|
|
2,397,642 |
|
|
Other liabilities |
164,571 |
|
|
163,182 |
|
|
218,852 |
|
|
Total liabilities |
12,392,470 |
|
|
12,251,420 |
|
|
5,813,795 |
|
|
Stockholders' equity |
3,500,291 |
|
|
3,465,119 |
|
|
818,935 |
|
|
Total liabilities and stockholders'
equity |
$ 15,892,761 |
|
|
$ 15,716,539 |
|
|
$ 6,632,730 |
|
|
Net interest income |
|
$ 194,983 |
|
|
$ 188,846 |
|
|
$ 81,258 |
|
Net interest spread |
|
|
5.67% |
|
|
5.61% |
|
|
5.26% |
Net interest margin |
|
|
5.86% |
|
|
5.78% |
|
|
5.41% |
|
|
|
|
|
|
|
|
|
|
Total deposits (2) |
$ 11,579,987 |
$ 9,972 |
0.34% |
$ 11,556,902 |
$ 8,822 |
0.30% |
$ 5,452,522 |
$ 1,450 |
0.11% |
Funding sources (3) |
$ 12,227,899 |
$ 14,713 |
0.48% |
$ 12,088,238 |
$ 13,510 |
0.44% |
$ 5,594,943 |
$ 2,598 |
0.18% |
|
|
|
|
|
|
|
|
|
|
(1) The tax equivalent yield on
investment securities was 3.45%, 3.47%, and 3.14% for the three
months ended December 31, 2014, September 30, 2014, and December
31, 2013. |
(2) Total deposits is the sum of
interest-bearing deposits and noninterest-bearing demand
deposits. The cost of total deposits is calculated as
annualized interest expense on deposits divided by average total
deposits. |
(3) Funding sources is the sum
of interest-bearing liabilities and noninterest-bearing demand
deposits. The cost of funding sources is calculated as annualized
total interest expense divided by average funding sources. |
|
PACWEST BANCORP AND
SUBSIDIARIES |
FIVE QUARTER BALANCE
SHEET |
|
|
|
|
|
|
|
December 31, |
September 30, |
June 30, |
March 31, |
December 31, |
|
2014 |
2014 |
2014 |
2014 |
2013 |
|
(Dollars in thousands,
except per share data) |
ASSETS: |
|
|
|
|
|
Cash and due from banks |
$ 164,757 |
$ 145,463 |
$ 243,583 |
$ 113,508 |
$ 96,424 |
Interest-earning deposits in financial
institutions |
148,469 |
115,399 |
119,782 |
228,579 |
50,998 |
Total cash and cash
equivalents |
313,226 |
260,862 |
363,365 |
342,087 |
147,422 |
|
|
|
|
|
|
Securities available-for-sale |
1,567,177 |
1,539,681 |
1,552,115 |
1,477,473 |
1,494,745 |
Federal Home Loan Bank stock, at cost |
40,609 |
45,602 |
49,983 |
25,000 |
27,939 |
Total investment
securities |
1,607,786 |
1,585,283 |
1,602,098 |
1,502,473 |
1,522,684 |
|
|
|
|
|
|
Non-PCI loans and leases |
11,613,832 |
11,239,964 |
10,802,053 |
3,828,569 |
3,930,539 |
PCI loans |
290,852 |
351,431 |
398,471 |
332,516 |
382,796 |
Total gross loans and leases |
11,904,684 |
11,591,395 |
11,200,524 |
4,161,085 |
4,313,335 |
Deferred fees and costs |
(22,252) |
(16,510) |
(10,419) |
(18) |
(983) |
Total loans and leases, net of deferred
fees |
11,882,432 |
11,574,885 |
11,190,105 |
4,161,067 |
4,312,352 |
Allowance for loan and lease losses |
(84,455) |
(81,899) |
(82,149) |
(81,180) |
(82,034) |
Total loans and leases,
net |
11,797,977 |
11,492,986 |
11,107,956 |
4,079,887 |
4,230,318 |
|
|
|
|
|
|
Equipment leased to others under operating
leases |
122,506 |
125,119 |
127,289 |
-- |
-- |
Premises and equipment, net |
36,551 |
38,368 |
40,440 |
29,908 |
32,435 |
Foreclosed assets, net |
43,721 |
40,524 |
53,821 |
50,895 |
55,891 |
FDIC loss sharing asset |
18,734 |
22,977 |
28,834 |
34,628 |
45,524 |
Deferred tax asset, net |
284,411 |
331,176 |
342,105 |
72,683 |
79,636 |
Goodwill |
1,720,479 |
1,722,129 |
1,725,153 |
208,743 |
208,743 |
Core deposit and customer relationship
intangibles, net |
17,204 |
18,822 |
20,431 |
15,884 |
17,248 |
Other assets |
272,205 |
300,099 |
273,374 |
180,665 |
193,462 |
Total assets |
$ 16,234,800 |
$ 15,938,345 |
$ 15,684,866 |
$ 6,517,853 |
$ 6,533,363 |
|
|
|
|
|
|
LIABILITIES: |
|
|
|
|
|
Noninterest-bearing deposits |
$ 2,931,352 |
$ 2,842,488 |
$ 2,701,434 |
$ 2,391,609 |
$ 2,318,446 |
Interest-bearing deposits |
8,823,776 |
8,680,949 |
8,966,363 |
2,977,799 |
2,962,541 |
Total deposits |
11,755,128 |
11,523,437 |
11,667,797 |
5,369,408 |
5,280,987 |
Borrowings |
383,402 |
363,672 |
4,596 |
5,748 |
113,726 |
Subordinated debentures |
433,583 |
433,545 |
434,878 |
132,790 |
132,645 |
Accrued interest payable and other
liabilities |
156,262 |
139,445 |
139,663 |
176,205 |
196,912 |
Total liabilities |
12,728,375 |
12,460,099 |
12,246,934 |
5,684,151 |
5,724,270 |
|
|
|
|
|
|
STOCKHOLDERS' EQUITY
(1) |
3,506,425 |
3,478,246 |
3,437,932 |
833,702 |
809,093 |
Total liabilities and
shareholders' equity |
$ 16,234,800 |
$ 15,938,345 |
$ 15,684,866 |
$ 6,517,853 |
$ 6,533,363 |
|
|
|
|
|
|
(1) Includes net unrealized gain (loss) on
securities available-for-sale, net |
$ 26,380 |
$ 20,821 |
$ 20,121 |
$ 6,825 |
$ (3,347) |
|
|
|
|
|
|
Book value per share |
$ 34.04 |
$ 33.76 |
$ 33.37 |
$ 18.21 |
$ 17.66 |
Tangible book value per share |
$ 17.17 |
$ 16.86 |
$ 16.43 |
$ 13.31 |
$ 12.73 |
|
|
|
|
|
|
Shares outstanding (includes unvested
restricted shares) |
103,022,017 |
103,027,830 |
103,033,449 |
45,777,580 |
45,822,834 |
|
PACWEST BANCORP AND
SUBSIDIARIES |
FIVE QUARTER STATEMENT OF
EARNINGS |
|
|
|
|
|
|
|
Three Months
Ended |
|
December 31, |
September 30, |
June 30, |
March 31, |
December 31, |
|
2014 |
2014 |
2014 |
2014 |
2013 |
|
(Dollars in thousands,
except per share data) |
Interest income: |
|
|
|
|
|
Loans and leases |
$ 197,472 |
$ 189,961 |
$ 192,201 |
$ 77,463 |
$ 73,352 |
Investment securities |
12,205 |
12,331 |
11,986 |
10,823 |
10,422 |
Deposits in financial institutions |
19 |
64 |
176 |
74 |
82 |
Total interest
income |
209,696 |
202,356 |
204,363 |
88,360 |
83,856 |
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
Deposits |
9,972 |
8,822 |
7,313 |
1,225 |
1,450 |
Borrowings |
144 |
74 |
199 |
79 |
86 |
Subordinated debentures |
4,597 |
4,614 |
4,318 |
1,041 |
1,062 |
Total interest
expense |
14,713 |
13,510 |
11,830 |
2,345 |
2,598 |
|
|
|
|
|
|
Net interest income |
194,983 |
188,846 |
192,533 |
86,015 |
81,258 |
Provision (negative provision) for credit
losses |
2,063 |
5,050 |
5,030 |
(644) |
(1,338) |
Net interest income after
provision for credit losses |
192,920 |
183,796 |
187,503 |
86,659 |
82,596 |
|
|
|
|
|
|
Noninterest income: |
|
|
|
|
|
Service charges on deposit accounts |
2,787 |
2,725 |
2,719 |
3,002 |
3,197 |
Other commissions and fees |
4,556 |
6,371 |
5,743 |
1,932 |
2,125 |
Leased equipment income |
5,382 |
5,615 |
5,672 |
-- |
-- |
Gain (loss) on sale of loans and leases |
7 |
973 |
(485) |
106 |
683 |
Gain (loss) on securities |
-- |
-- |
89 |
4,752 |
(272) |
FDIC loss sharing expense, net |
(4,360) |
(7,415) |
(8,525) |
(11,430) |
(10,593) |
Other income |
4,331 |
8,045 |
3,266 |
6,329 |
934 |
Total noninterest
income |
12,703 |
16,314 |
8,479 |
4,691 |
(3,926) |
|
|
|
|
|
|
Noninterest expense: |
|
|
|
|
|
Compensation |
45,930 |
45,861 |
45,081 |
28,627 |
27,697 |
Occupancy |
10,745 |
11,188 |
11,078 |
7,595 |
7,553 |
Data processing |
4,050 |
3,929 |
4,099 |
2,540 |
2,216 |
Other professional services |
3,181 |
3,687 |
2,843 |
1,523 |
1,770 |
Insurance and assessments |
3,115 |
3,020 |
3,179 |
1,593 |
1,572 |
Intangible asset amortization |
1,619 |
1,608 |
1,677 |
1,364 |
1,430 |
Other expenses |
11,278 |
13,355 |
12,115 |
7,288 |
7,746 |
Total operating
expense |
79,918 |
82,648 |
80,072 |
50,530 |
49,984 |
Leased equipment depreciation |
3,103 |
2,961 |
3,095 |
-- |
-- |
Foreclosed assets expense (income), net |
1,938 |
4,827 |
497 |
(1,861) |
(569) |
Acquisition, integration, reorganization and
severance costs |
7,381 |
5,193 |
86,242 |
2,200 |
16,673 |
Total noninterest
expense |
92,340 |
95,629 |
169,906 |
50,869 |
66,088 |
|
|
|
|
|
|
Earnings from continuing operations before
taxes |
113,283 |
104,481 |
26,076 |
40,481 |
12,582 |
Income tax expense |
(42,226) |
(42,205) |
(14,846) |
(14,576) |
(9,135) |
Net earnings from continuing
operations |
71,057 |
62,276 |
11,230 |
25,905 |
3,447 |
|
|
|
|
|
|
Loss from discontinued operations before
taxes |
(105) |
(8) |
(1,151) |
(1,413) |
(578) |
Income tax benefit |
47 |
3 |
476 |
588 |
240 |
Net loss from discontinued
operations |
(58) |
(5) |
(675) |
(825) |
(338) |
|
|
|
|
|
|
Net earnings |
$ 70,999 |
$ 62,271 |
$ 10,555 |
$ 25,080 |
$ 3,109 |
|
|
|
|
|
|
Basic and diluted earnings per
share: |
|
|
|
|
|
Net earnings from continuing
operations |
$ 0.69 |
$ 0.60 |
$ 0.11 |
$ 0.57 |
$ 0.07 |
Net earnings |
$ 0.69 |
$ 0.60 |
$ 0.10 |
$ 0.55 |
$ 0.06 |
|
PACWEST BANCORP AND
SUBSIDIARIES |
FIVE QUARTER SELECTED
FINANCIAL DATA |
|
|
|
|
|
|
|
At or For the
Three Months Ended |
|
December 31, |
September 30, |
June 30, |
March 31, |
December 31, |
|
2014 |
2014 |
2014 |
2014 |
2013 |
|
(Dollars in
thousands) |
Performance Ratios -
GAAP: |
|
|
|
|
|
Annualized return on average assets |
1.77% |
1.57% |
0.28% |
1.56% |
0.19% |
Annualized return on average equity |
8.05% |
7.13% |
1.31% |
12.40% |
1.51% |
Yield on loans and leases |
6.76% |
6.68% |
7.34% |
7.42% |
6.77% |
Yield on interest-earning assets |
6.30% |
6.19% |
6.62% |
6.11% |
5.58% |
Cost of total deposits |
0.34% |
0.30% |
0.26% |
0.09% |
0.11% |
Cost of time deposits |
0.60% |
0.51% |
0.42% |
0.31% |
0.40% |
Cost of interest-bearing liabilities |
0.63% |
0.58% |
0.52% |
0.30% |
0.32% |
Cost of funding sources |
0.48% |
0.44% |
0.41% |
0.17% |
0.18% |
Net interest rate spread |
5.67% |
5.61% |
6.10% |
5.81% |
5.26% |
Net interest margin |
5.86% |
5.78% |
6.24% |
5.95% |
5.41% |
Annualized operating expense as a
percentage of average assets |
2.00% |
2.09% |
2.14% |
3.15% |
2.99% |
Annualized noninterest expense as a
percentage of average assets |
2.31% |
2.41% |
4.53% |
3.17% |
3.95% |
Efficiency ratio |
44.5% |
46.6% |
84.5% |
56.1% |
85.5% |
|
|
|
|
|
|
Performance Ratios -
Non-GAAP: |
|
|
|
|
|
Annualized adjusted return on average
assets |
1.70% |
1.70% |
1.67% |
1.38% |
1.33% |
Annualized adjusted return on average
equity |
7.73% |
7.70% |
7.79% |
10.98% |
10.76% |
Annualized return on average tangible
equity |
16.00% |
14.36% |
2.65% |
17.10% |
2.11% |
Annualized adjusted return on average
tangible equity |
15.37% |
15.50% |
15.79% |
15.13% |
15.05% |
Core net interest margin |
5.52% |
5.64% |
5.74% |
5.42% |
5.31% |
Adjusted efficiency ratio |
42.3% |
43.4% |
43.1% |
57.1% |
58.1% |
|
|
|
|
|
|
Average Balances: |
|
|
|
|
|
Average loans and leases |
$ 11,586,573 |
$ 11,285,689 |
$ 10,500,521 |
$ 4,231,319 |
$ 4,301,377 |
Average interest-earning assets |
13,205,383 |
12,969,776 |
12,383,464 |
5,862,695 |
5,962,428 |
Average total assets |
15,892,761 |
15,716,539 |
15,037,101 |
6,513,376 |
6,632,730 |
Average noninterest-bearing deposits |
2,900,388 |
2,778,260 |
2,546,540 |
2,374,325 |
2,397,642 |
Average interest-bearing deposits |
8,679,599 |
8,778,642 |
8,629,482 |
2,968,994 |
3,054,880 |
Average total deposits |
11,579,987 |
11,556,902 |
11,176,022 |
5,343,319 |
5,452,522 |
Average borrowings and subordinated
debentures |
647,912 |
531,336 |
449,865 |
150,872 |
142,421 |
Average interest-bearing liabilities |
9,327,511 |
9,309,978 |
9,079,347 |
3,119,866 |
3,197,301 |
Average funding sources |
12,227,899 |
12,088,238 |
11,625,887 |
5,494,191 |
5,594,943 |
Average stockholders' equity |
3,500,291 |
3,465,119 |
3,233,018 |
820,248 |
818,935 |
|
PACWEST BANCORP AND
SUBSIDIARIES |
FIVE QUARTER SELECTED
FINANCIAL DATA |
|
|
|
|
|
|
|
At or For the
Three Months Ended |
|
December 31, |
September 30, |
June 30, |
March 31, |
December 31, |
|
2014 |
2014 |
2014 |
2014 |
2013 |
|
(Dollars in
thousands) |
Non-PCI Credit Quality: |
|
|
|
|
|
Allowance for credit losses to loans and
leases |
0.66% |
0.61% |
0.67% |
1.75% |
1.73% |
Allowance for credit losses to nonaccrual
loans and leases |
92% |
78% |
75% |
115% |
145% |
Nonaccrual loans and leases to loans and
leases |
0.72% |
0.79% |
0.90% |
1.52% |
1.19% |
Nonperforming assets to loans and leases
and foreclosed assets |
1.09% |
1.15% |
1.39% |
2.81% |
2.58% |
Nonperforming assets to total assets |
0.78% |
0.81% |
0.96% |
1.67% |
1.57% |
Trailing twelve month net charge-offs to
average loans and leases |
0.02% |
0.09% |
0.05% |
0.13% |
0.12% |
|
|
|
|
|
|
PacWest Bancorp
Consolidated Capital Ratios: |
|
|
|
|
Tier 1 leverage capital ratio |
12.34% |
12.17% |
12.40% |
11.73% |
11.22% |
Tier 1 risk-based capital ratio |
13.16% |
13.24% |
13.15% |
16.16% |
15.12% |
Total risk-based capital ratio |
16.07% |
16.24% |
16.25% |
17.42% |
16.38% |
Tangible common equity ratio (non-GAAP
measure) |
12.20% |
12.24% |
12.14% |
9.68% |
9.24% |
|
|
|
|
|
|
Pacific Western Bank Capital
Ratios: |
|
|
|
|
|
Tier 1 leverage capital ratio |
11.70% |
11.74% |
11.71% |
10.88% |
10.79% |
Tier 1 risk-based capital ratio |
12.46% |
12.74% |
12.58% |
15.00% |
14.54% |
Total risk-based capital ratio |
13.16% |
13.44% |
13.32% |
16.25% |
15.80% |
Tangible common equity ratio (non-GAAP
measure) |
11.51% |
11.60% |
11.40% |
10.92% |
10.88% |
|
PACWEST BANCORP AND
SUBSIDIARIES |
NET EARNINGS PER SHARE
CALCULATIONS |
|
|
|
|
|
|
|
Three Months
Ended |
Year
Ended |
|
December 31, |
September 30, |
December 31, |
December
31, |
|
2014 |
2014 |
2013 |
2014 |
2013 |
|
(Dollars in thousands,
except per share data) |
Basic Earnings Per
Share: |
|
|
|
|
|
Net earnings from continuing
operations |
$ 71,057 |
$ 62,276 |
$ 3,447 |
$ 170,468 |
$ 45,477 |
Less: earnings allocated to unvested
restricted stock (1) |
(810) |
(685) |
(280) |
(1,959) |
(1,096) |
Net earnings from continuing operations
allocated to common shares |
70,247 |
61,591 |
3,167 |
168,509 |
44,381 |
Net earnings from discontinued operations
allocated to common shares |
(57) |
(5) |
(338) |
(1,545) |
(348) |
Net earnings allocated to common
shares |
$ 70,190 |
$ 61,586 |
$ 2,829 |
$ 166,964 |
$ 44,033 |
|
|
|
|
|
|
Weighted-average basic shares and
unvested restricted stock outstanding |
103,045 |
103,029 |
46,069 |
87,871 |
42,506 |
Less: weighted-average unvested
restricted stock outstanding |
(1,132) |
(1,117) |
(1,743) |
(1,018) |
(1,683) |
Weighted-average basic shares
outstanding |
101,913 |
101,912 |
44,326 |
86,853 |
40,823 |
|
|
|
|
|
|
Basic earnings per share: |
|
|
|
|
|
Net earnings from continuing
operations |
$ 0.69 |
$ 0.60 |
$ 0.07 |
$ 1.94 |
$ 1.09 |
Net earnings from discontinued
operations |
-- |
-- |
(0.01) |
(0.02) |
(0.01) |
Net earnings |
$ 0.69 |
$ 0.60 |
$ 0.06 |
$ 1.92 |
$ 1.08 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per
Share: |
|
|
|
|
|
Net earnings from continuing operations
allocated to common shares |
$ 70,247 |
$ 61,591 |
$ 3,167 |
$ 168,509 |
$ 44,381 |
Net earnings from discontinued operations
allocated to common shares |
(57) |
(5) |
(338) |
(1,545) |
(348) |
Net earnings allocated to common
shares |
$ 70,190 |
$ 61,586 |
$ 2,829 |
$ 166,964 |
$ 44,033 |
|
|
|
|
|
|
Weighted-average basic shares
outstanding |
101,913 |
101,912 |
44,326 |
86,853 |
40,823 |
|
|
|
|
|
|
Diluted earnings per share: |
|
|
|
|
|
Net earnings from continuing
operations |
$ 0.69 |
$ 0.60 |
$ 0.07 |
$ 1.94 |
$ 1.09 |
Net earnings from discontinued
operations |
-- |
-- |
(0.01) |
(0.02) |
(0.01) |
Net earnings |
$ 0.69 |
$ 0.60 |
$ 0.06 |
$ 1.92 |
$ 1.08 |
|
|
|
|
|
|
(1) Represents cash dividends
paid to holders of unvested stock, net of estimated forfeitures,
plus undistributed earnings amounts available to holders of
unvested restricted stock, if any. |
GAAP TO NON-GAAP RECONCILIATION
This press release contains certain non-GAAP financial
disclosures for adjusted net earnings, adjusted return on average
assets, adjusted return on average equity, return on average
tangible equity, adjusted return on average tangible equity,
tangible common equity amounts and ratios, tangible book value per
share, adjusted efficiency ratio, core net interest margin, and
operating expense as a percentage of average assets. The Company
uses certain non-GAAP financial measures to provide meaningful
supplemental information regarding the Company's operational
performance and to enhance investors' overall understanding of such
financial performance:
- Adjusted net earnings - as analysts and investors view this
measure as an indicator of the Company's ability to both generate
earnings and absorb credit losses, we disclose this amount in
addition to net earnings.
- Adjusted return on average assets, adjusted return on average
equity, return on average tangible equity, adjusted return on
average tangible equity, tangible common equity amounts and ratios,
and tangible book value per share - given that the use of these
measures is prevalent among banking regulators, investors and
analysts, we disclose them in addition to return on average assets,
return on average equity, equity-to-assets ratio, and book value
per share, respectively.
- Adjusted efficiency ratio - we disclose this measure in
addition to efficiency ratio as it shows the trend in recurring
overhead-related noninterest expense relative to recurring net
revenues.
Please refer to the tables on the following pages for a
presentation of performance ratios in accordance with GAAP and a
reconciliation of the non-GAAP financial measures to the GAAP
financial measures.
PACWEST BANCORP AND
SUBSIDIARIES |
GAAP TO NON-GAAP
RECONCILIATION |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
Year
Ended |
Adjusted Net
Earnings |
December 31, |
September 30, |
December 31, |
December
31, |
and Related Ratios |
2014 |
2014 |
2013 |
2014 |
2013 |
|
(Dollars in
thousands) |
|
|
|
|
|
|
Reported net earnings |
$ 70,999 |
$ 62,271 |
$ 3,109 |
$ 168,905 |
$ 45,115 |
Less: Tax benefit on discontinued
operations |
(47) |
(3) |
(240) |
(1,114) |
(258) |
Add: Tax expense on continuing
operations |
42,226 |
42,205 |
9,135 |
113,853 |
30,003 |
Reported pre-tax earnings |
113,178 |
104,473 |
12,004 |
281,644 |
74,860 |
Add: Acquisition, integration, reorganization
and severance costs |
7,381 |
5,193 |
16,673 |
101,016 |
40,812 |
Less: FDIC loss sharing expense, net |
(4,360) |
(7,415) |
(10,593) |
(31,730) |
(26,172) |
Gain on sale of loans and leases |
7 |
973 |
683 |
601 |
1,791 |
(Loss) gain on securities |
-- |
-- |
(272) |
4,841 |
5,359 |
Covered OREO (expense) income, net |
(176) |
(452) |
594 |
1,172 |
1,833 |
Gain on sale of owned office
building |
-- |
-- |
-- |
1,570 |
-- |
Adjusted pre-tax earnings before accelerated
discount accretion |
125,088 |
116,560 |
38,265 |
406,206 |
132,861 |
Less: Accelerated discount accretion
resulting from payoffs of acquired loans |
11,421 |
4,501 |
1,434 |
38,867 |
4,393 |
Adjusted pre-tax earnings |
113,667 |
112,059 |
36,831 |
367,339 |
128,468 |
Tax expense (1) |
(45,467) |
(44,824) |
(14,622) |
(146,936) |
(51,002) |
Adjusted net earnings |
$ 68,200 |
$ 67,235 |
$ 22,209 |
$ 220,403 |
$ 77,466 |
|
|
|
|
|
|
Average assets |
$ 15,892,761 |
$ 15,716,539 |
$ 6,632,730 |
$ 13,322,388 |
$ 6,116,853 |
|
|
|
|
|
|
Average stockholders' equity |
$ 3,500,291 |
$ 3,465,119 |
$ 818,935 |
$ 2,763,726 |
$ 718,920 |
Less: Average intangible assets |
1,739,977 |
1,744,542 |
233,628 |
1,342,286 |
172,096 |
Average tangible common equity |
$ 1,760,314 |
$ 1,720,577 |
$ 585,307 |
$ 1,421,440 |
$ 546,824 |
|
|
|
|
|
|
Annualized return on average assets (2) |
1.77% |
1.57% |
0.19% |
1.27% |
0.74% |
Annualized adjusted return on average assets
(3) |
1.70% |
1.70% |
1.33% |
1.65% |
1.27% |
Annualized return on average equity (4) |
8.05% |
7.13% |
1.51% |
6.11% |
6.28% |
Annualized adjusted return on average equity
(5) |
7.73% |
7.70% |
10.76% |
7.97% |
10.78% |
Annualized return on average tangible equity
(6) |
16.00% |
14.36% |
2.11% |
11.88% |
8.25% |
Annualized adjusted return on average
tangible equity (7) |
15.37% |
15.50% |
15.05% |
15.51% |
14.17% |
|
|
|
|
|
|
(1) Effective tax rates of40.0%
in 2014 periods and 39.7% in 2013 periods. |
(2) Annualized net earnings
divided by average assets |
(3) Annualized adjusted net
earnings divided by average assets |
(4) Annualized net earnings
divided by average stockholders' equity |
(5) Annualized adjusted net
earnings divided by average stockholders' equity |
(6) Annualized net earnings
divided by average tangible common equity |
(7) Annualized adjusted net
earnings divided by average tangible common equity |
|
PACWEST BANCORP AND
SUBSIDIARIES |
GAAP TO NON-GAAP
RECONCILIATION |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
Year
Ended |
|
December 31, |
September 30, |
December 31, |
December
31, |
Adjusted Efficiency
Ratio |
2014 |
2014 |
2013 |
2014 |
2013 |
|
(Dollars in
thousands) |
|
|
|
|
|
|
Noninterest expense |
$ 92,340 |
$ 95,629 |
$ 66,088 |
$ 408,744 |
$ 230,687 |
Less: Acquisition, integration,
reorganization and severance costs |
7,381 |
5,193 |
16,673 |
101,016 |
40,812 |
Covered OREO expense (income), net |
176 |
452 |
(594) |
(1,172) |
(1,833) |
Adjusted noninterest expense |
$ 84,783 |
$ 89,984 |
$ 50,009 |
$ 308,900 |
$ 191,708 |
|
|
|
|
|
|
Net interest income |
$ 194,983 |
$ 188,846 |
$ 81,258 |
$ 662,377 |
$ 297,713 |
Noninterest income |
12,703 |
16,314 |
(3,926) |
42,187 |
4,244 |
Net revenues |
207,686 |
205,160 |
77,332 |
704,564 |
301,957 |
Less: FDIC loss sharing expense, net |
(4,360) |
(7,415) |
(10,593) |
(31,730) |
(26,172) |
Gain on sale of loans and leases |
7 |
973 |
683 |
601 |
1,791 |
(Loss) gain on securities |
-- |
-- |
(272) |
4,841 |
5,359 |
Gain on sale of owned office
building |
-- |
-- |
-- |
1,570 |
-- |
Accelerated discount accretion resulting
from payoffs of acquired loans |
11,421 |
4,501 |
1,434 |
38,867 |
4,393 |
Adjusted net revenues |
$ 200,618 |
$ 207,101 |
$ 86,080 |
$ 690,415 |
$ 316,586 |
|
|
|
|
|
|
Base efficiency ratio (1) |
44.5% |
46.6% |
85.5% |
58.0% |
76.4% |
Adjusted efficiency ratio (2) |
42.3% |
43.4% |
58.1% |
44.7% |
60.6% |
|
|
|
|
|
|
(1) Noninterest expense divided
by net revenues |
(2) Adjusted noninterest expense
divided by adjusted net revenues |
|
PACWEST BANCORP AND
SUBSIDIARIES |
GAAP TO NON-GAAP
RECONCILIATION |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
September 30, |
June 30, |
March 31, |
December 31, |
Tangible Common Equity
Ratio |
2014 |
2014 |
2014 |
2014 |
2013 |
|
(Dollars in
thousands) |
PacWest Bancorp
Consolidated: |
|
|
|
|
|
Stockholders' equity |
$ 3,506,425 |
$ 3,478,246 |
$ 3,437,932 |
$ 833,702 |
$ 809,093 |
Less: Intangible assets |
1,737,683 |
1,740,951 |
1,745,584 |
224,627 |
225,991 |
Tangible common equity |
$ 1,768,742 |
$ 1,737,295 |
$ 1,692,348 |
$ 609,075 |
$ 583,102 |
|
|
|
|
|
|
Total assets |
$ 16,234,800 |
$ 15,938,345 |
$ 15,684,866 |
$ 6,517,853 |
$ 6,533,363 |
Less: Intangible assets |
1,737,683 |
1,740,951 |
1,745,584 |
224,627 |
225,991 |
Tangible assets |
$ 14,497,117 |
$ 14,197,394 |
$ 13,939,282 |
$ 6,293,226 |
$ 6,307,372 |
|
|
|
|
|
|
Equity to assets ratio |
21.60% |
21.82% |
21.92% |
12.79% |
12.38% |
Tangible common equity ratio (1) |
12.20% |
12.24% |
12.14% |
9.68% |
9.24% |
|
|
|
|
|
|
Book value per share |
$ 34.04 |
$ 33.76 |
$ 33.37 |
$ 18.21 |
$ 17.66 |
Tangible book value per share (2) |
$ 17.17 |
$ 16.86 |
$ 16.43 |
$ 13.31 |
$ 12.73 |
Shares outstanding |
103,022,017 |
103,027,830 |
103,033,449 |
45,777,580 |
45,822,834 |
|
|
|
|
|
|
|
|
|
|
|
|
Pacific Western Bank: |
|
|
|
|
|
Stockholders' equity |
$ 3,379,074 |
$ 3,357,138 |
$ 3,298,908 |
$ 910,644 |
$ 911,200 |
Less: Intangible assets |
1,737,682 |
1,740,951 |
1,745,584 |
224,627 |
225,991 |
Tangible common equity |
$ 1,641,392 |
$ 1,616,187 |
$ 1,553,324 |
$ 686,017 |
$ 685,209 |
|
|
|
|
|
|
Total assets |
$ 15,995,914 |
$ 15,675,486 |
$ 15,376,440 |
$ 6,507,288 |
$ 6,523,742 |
Less: Intangible assets |
1,737,682 |
1,740,951 |
1,745,584 |
224,627 |
225,991 |
Tangible assets |
$ 14,258,232 |
$ 13,934,535 |
$ 13,630,856 |
$ 6,282,661 |
$ 6,297,751 |
|
|
|
|
|
|
Equity to assets ratio |
21.12% |
21.42% |
21.45% |
13.99% |
13.97% |
Tangible common equity ratio |
11.51% |
11.60% |
11.40% |
10.92% |
10.88% |
|
|
|
|
|
|
(1) Tangible common equity
divided by tangible assets |
(2) Tangible common equity
divided by shares outstanding |
CONTACT: Matthew P. Wagner
President and CEO
10250 Constellation Boulevard, Suite 1640
Los Angeles, CA 90067
Phone: 310-728-1020
Fax: 310-201-0498
Victor R. Santoro
Executive Vice President and CFO
10250 Constellation Boulevard, Suite 1640
Los Angeles, CA 90067
Phone: 310-728-1021
Fax: 310-201-0498
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