PacWest Bancorp (Nasdaq: PACW) -
THIRD QUARTER 2021 RESULTS
$140.0M |
$1.17 |
$167.8M |
21.03% |
Net
Earnings |
Diluted Earnings per
Share |
PPNR |
ROATE |
THIRD QUARTER 2021 HIGHLIGHTS
- Net Earnings of $140.0 Million or $1.17 Per Diluted Share
- Core Deposits Up $1.1 Billion or 4.1% in 3Q21; Represents 92%
of Total Deposits
- Loan Growth of $1.0 Billion or 5.2%; Excluding PPP Loan
Activity, Loan Growth of $1.3 Billion or 7.1%
- Civic Loan Production of $481 Million in 3Q21, Compared to $423
Million in 2Q21
- PPNR of $167.8 Million, Up 8.3% Compared to 2Q21
- Provision for Credit Losses Benefit of $20.0 Million in 3Q21
Compared to Benefit of $88.0 Million in 2Q21
- Net Interest Income (TE) of $279.8 Million in 3Q21, Compared to
$270.1 Million in 2Q21
- Noninterest Income of $51.3 Million in 3Q21, Compared to $40.4
Million in 2Q21, With Continued Strength in Warrant Income
- Noninterest Expense of $159.4 Million in 3Q21, Up 5% From 2Q21,
Driven Mainly By Higher Compensation Expense
- Classified and Special Mention Loans Fell $5.7 Million and
$39.7 Million, Respectively, From 2Q21
- ACL Ratio of 1.36% and ALLL Ratio of 0.99%; Excluding PPP
Loans, ACL Ratio of 1.38% and ALLL Ratio of 1.01%
- Net Charge-offs of $0.4 Million (1 bp of Average Loans and
Leases)
- Cost of Deposits Decreased 2 bps to 8 bps
- Loan and Lease Production of $2.4 Billion, Up From $1.7 Billion
in 2Q21; WAC of 4.24% vs. 4.55% in 2Q21
- Strong Capital Position – CET1 Ratio of 10.15% and Total
Capital Ratio of 14.36% at 3Q21
- Tangible Book Value Per Share Increased From $21.95 at 2Q21 to
$22.57 at 3Q21
CEO COMMENTARY
Matt Wagner, President and CEO, commented, “For the second
consecutive quarter, we experienced significant loan growth as
loans grew $1.0 billion to an all-time high of $20.5 billion.
Deploying approximately $3 billion of excess liquidity into
higher-yielding securities and loans during the third quarter
resulted in a $9.5 million increase in net interest income and
helped drive a $12.8 million increase in our pre-tax pre-provision
net revenue compared to the second quarter.”
“We continued to experience strong deposit growth as core
deposits grew by $1.1 billion during the third quarter while our
cost of average total deposits moved into the single digits at 8
basis points.”
“Credit quality continues to improve with net recoveries
year-to-date and continued decreases in special mention and
classified loans and leases, along with improved economic
conditions related to the CECL forecast which resulted in a
provision benefit for the third consecutive quarter.”
“We are excited about the acquisition of the Homeowners
Association Services Division of MUFG Union Bank, N.A. which closed
on October 8th. The approximately $4.1 billion of stable, low-cost
deposits enhances our franchise value, further diversifies our
deposit portfolio, and will become more valuable in a rising rate
environment.”
A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/60516d02-d69d-4910-aaa9-0d9ace006bd6
FINANCIAL HIGHLIGHTS
|
|
|
|
|
|
|
|
|
|
|
|
` |
At or For the |
|
|
|
At or For the |
|
|
|
Three Months Ended |
|
|
|
Nine Months Ended |
|
|
|
September 30, |
|
June 30, |
|
Increase |
|
September 30, |
|
Increase |
Financial Highlights
(1) |
2021 |
|
2021 |
|
(Decrease) |
|
2021 |
|
2020 |
|
(Decrease) |
|
(Dollars in thousands, except per share data) |
Net earnings (loss) |
$ |
139,996 |
|
$ |
180,512 |
|
$ |
(40,516) |
|
$ |
470,914 |
|
$ |
(1,354,404) |
|
$ |
1,825,318 |
Diluted earnings (loss) |
|
|
|
|
|
|
|
|
|
|
|
per share |
$ |
1.17 |
|
$ |
1.52 |
|
$ |
(0.35) |
|
$ |
3.96 |
|
$ |
(11.60) |
|
$ |
15.56 |
Pre-provision, pre-goodwill |
|
|
|
|
|
|
|
|
|
|
|
impairment, pre-tax net |
|
|
|
|
|
|
|
|
|
|
|
revenue ("PPNR") (2) |
$ |
167,766 |
|
$ |
154,929 |
|
$ |
12,837 |
|
$ |
478,657 |
|
$ |
483,223 |
|
$ |
(4,566) |
Return on average assets |
1.55% |
|
2.11% |
|
(0.56) |
|
1.86% |
|
(6.65)% |
|
8.51 |
PPNR return on average |
|
|
|
|
|
|
|
|
|
|
|
assets (2) |
1.86% |
|
1.81% |
|
0.05 |
|
1.89% |
|
2.37% |
|
(0.48) |
Return on average |
|
|
|
|
|
|
|
|
|
|
|
tangible equity (2) |
21.03% |
|
29.25% |
|
(8.22) |
|
25.20% |
|
7.16% |
|
18.04 |
|
|
|
|
|
|
|
|
|
|
|
|
Yield on average loans
and |
|
|
|
|
|
|
|
|
|
|
|
leases (tax equivalent) |
5.01% |
|
5.18% |
|
(0.17) |
|
5.13% |
|
5.18% |
|
(0.05) |
Cost of average
total |
|
|
|
|
|
|
|
|
|
|
|
deposits |
0.08% |
|
0.10% |
|
(0.02) |
|
0.10% |
|
0.32% |
|
(0.22) |
Net interest margin ("NIM") |
|
|
|
|
|
|
|
|
|
|
|
(tax equivalent) |
3.33% |
|
3.40% |
|
(0.07) |
|
3.46% |
|
4.13% |
|
(0.67) |
Efficiency ratio |
47.2% |
|
47.9% |
|
(0.7) |
|
47.2% |
|
42.9% |
|
4.3 |
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
$ |
35,885,676 |
|
$ |
34,867,987 |
|
$ |
1,017,689 |
|
$ |
35,885,676 |
|
$ |
28,426,716 |
|
$ |
7,458,960 |
Loans and leases held |
|
|
|
|
|
|
|
|
|
|
|
for investment, |
|
|
|
|
|
|
|
|
|
|
|
net of deferred fees |
$ |
20,511,020 |
|
$ |
19,506,257 |
|
$ |
1,004,763 |
|
$ |
20,511,020 |
|
$ |
19,026,200 |
|
$ |
1,484,820 |
Noninterest-bearing |
|
|
|
|
|
|
|
|
|
|
|
demand deposits |
$ |
12,881,806 |
|
$ |
11,252,286 |
|
$ |
1,629,520 |
|
$ |
12,881,806 |
|
$ |
9,346,744 |
|
$ |
3,535,062 |
Core deposits |
$ |
28,140,708 |
|
$ |
27,038,161 |
|
$ |
1,102,547 |
|
$ |
28,140,708 |
|
$ |
21,117,629 |
|
$ |
7,023,079 |
Total deposits |
$ |
30,559,745 |
|
$ |
29,647,034 |
|
$ |
912,711 |
|
$ |
30,559,745 |
|
$ |
23,965,695 |
|
$ |
6,594,050 |
|
|
|
|
|
|
|
|
|
|
|
|
As percentage of total |
|
|
|
|
|
|
|
|
|
|
|
deposits: |
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing |
|
|
|
|
|
|
|
|
|
|
|
demand deposits |
42% |
|
38% |
|
4 |
|
42% |
|
39% |
|
3 |
Core deposits |
92% |
|
91% |
|
1 |
|
92% |
|
88% |
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
Equity to assets ratio |
10.92% |
|
11.03% |
|
(0.11) |
|
10.92% |
|
12.26% |
|
(1.34) |
Common equity tier 1 |
|
|
|
|
|
|
|
|
|
|
|
capital ratio |
10.15% |
|
10.41% |
|
(0.26) |
|
10.15% |
|
10.45% |
|
(0.30) |
Total capital ratio |
14.36% |
|
14.99% |
|
(0.63) |
|
14.36% |
|
13.74% |
|
0.62 |
Tangible common equity |
|
|
|
|
|
|
|
|
|
|
|
ratio (2) |
7.79% |
|
7.80% |
|
(0.01) |
|
7.79% |
|
8.71% |
|
(0.92) |
Book value per share |
$ |
32.77 |
|
$ |
32.17 |
|
$ |
0.60 |
|
$ |
32.77 |
|
$ |
29.42 |
|
$ |
3.35 |
Tangible book value per |
|
|
|
|
|
|
|
|
|
|
|
share (2) |
$ |
22.57 |
|
$ |
21.95 |
|
$ |
0.62 |
|
$ |
22.57 |
|
$ |
20.09 |
|
$ |
2.48 |
|
|
|
|
|
|
|
|
|
|
|
|
(1) The
operations of Civic are included from its February 1, 2021
acquisition date. |
|
|
|
|
|
(2) Non-GAAP measure. |
|
|
|
|
|
|
|
|
|
|
|
INCOME STATEMENT HIGHLIGHTS
NET INTEREST INCOME
Net interest income increased by $9.5 million to
$275.8 million for the third quarter of 2021 compared to $266.3
million for the second quarter of 2021 due mainly to higher income
on investment securities and loans and leases primarily resulting
from higher average balances as we deploy our excess liquidity.
Income on investment securities increased by $6.8 million in the
third quarter of 2021 due to a $1.6 billion increase in the average
balance of investment securities, partially offset by an 11 basis
point decrease in the yield on average investment securities.
Income on loans and leases increased $2.2 million in the third
quarter of 2021 due to a $613.3 million increase in the average
balance of loans and leases, partially offset by a 17 basis point
decrease in the yield on average loans and leases. The tax
equivalent yield on average loans and leases was 5.01% for the
third quarter of 2021 compared to 5.18% for the second quarter of
2021. The decrease in the tax equivalent yield on average loans and
leases was due primarily to lower nonaccrual interest recapture of
$2.6 million, lower loan prepayment fees of $1.7 million, and
higher loan premium amortization of $0.8 million.
The tax equivalent NIM was 3.33% for the third
quarter of 2021 compared to 3.40% for the second quarter of 2021.
The decrease in the NIM was due primarily to the change in the
earning assets mix driven by the increase in the investment
portfolio as a percentage of earning assets. The average balance of
investment securities increased by $1.6 billion to $8.0 billion,
the average balance of deposits in financial institutions decreased
by $690.0 million to $5.7 billion, and the average balance of loans
and leases increased by $613.3 million in the third quarter of
2021. The increase in average balances of investment securities and
loans and leases was the result of prudently deploying some of our
excess liquidity ahead of the closing of the acquisition of the HOA
Services Division of MUFG Union Bank that added approximately $4.1
billion of deposits on October 8th. Excess liquidity continues to
negatively impact the tax equivalent NIM, however, we saw the
impact decrease from approximately 73 basis points in the second
quarter of 2021 to approximately 57 basis points in the third
quarter of 2021.
The cost of average total deposits decreased to
0.08% in the third quarter of 2021 from 0.10% in the second quarter
of 2021. The lower cost of average total deposits was due primarily
to the $894 million increase in the average balance of
noninterest-bearing deposits.
PROVISION FOR CREDIT LOSSES
The following table presents details of the
provision for credit losses for the periods indicated:
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
September 30, |
|
June 30, |
|
Increase |
Provision for Credit Losses |
2021 |
|
2021 |
|
(Decrease) |
|
(In thousands) |
(Reduction in) addition to allowance for loan |
|
|
|
|
|
and lease losses |
$ |
(21,500) |
|
$ |
(72,000) |
|
$ |
50,500 |
Addition to (reduction in) reserve for |
|
|
|
|
|
unfunded loan commitments |
1,500 |
|
(16,000) |
|
17,500 |
Total provision for credit losses |
$ |
(20,000) |
|
$ |
(88,000) |
|
$ |
68,000 |
The provision for credit losses benefit was $20.0
million for the third quarter of 2021 compared to a benefit of
$88.0 million for the second quarter of 2021. The third quarter
benefit reflected improvement in both macro-economic forecast
variables and loan portfolio credit quality metrics, partially
offset by increased provisions for unfunded commitments and loan
growth.
Noninterest Income
The following table presents details of
noninterest income for the periods indicated:
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
September 30, |
|
June 30, |
|
Increase |
Noninterest Income |
2021 |
|
2021 |
|
(Decrease) |
|
(In thousands) |
Service charges on deposit accounts |
$ |
3,407 |
|
$ |
3,452 |
|
$ |
(45) |
Other commissions and fees |
11,792 |
|
10,704 |
|
1,088 |
Leased equipment income |
10,943 |
|
10,847 |
|
96 |
Gain on sale of loans and leases |
- |
|
1,422 |
|
(1,422) |
Gain on sale of securities |
515 |
|
- |
|
515 |
Other income: |
|
|
|
|
|
Dividends and gains on equity investments |
8,387 |
|
5,394 |
|
2,993 |
Warrant income |
13,578 |
|
5,650 |
|
7,928 |
Other |
2,723 |
|
2,902 |
|
(179) |
Total noninterest income |
$ |
51,345 |
|
$ |
40,371 |
|
$ |
10,974 |
Noninterest income increased by $11.0 million to
$51.3 million for the third quarter of 2021 compared to $40.4
million for the second quarter of 2021 due primarily to increases
of $7.9 million in warrant income and $3.0 million in dividends and
gains on equity investments. Warrant income increased due to a
higher number of and dollar amount of gains on warrant exercises
given the active capital markets. Dividends and gains on equity
investments increased due primarily to higher gains on sales of
equity investments and higher income distributions on SBIC
investments, offset partially by lower net fair value gains on
equity investments still held.
Noninterest Expense
The following table presents details of
noninterest expense for the periods indicated:
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
September 30, |
|
June 30, |
|
Increase |
Noninterest Expense |
2021 |
|
2021 |
|
(Decrease) |
|
(In thousands) |
Compensation |
$ |
98,061 |
|
$ |
90,807 |
|
$ |
7,254 |
Occupancy |
14,928 |
|
14,784 |
|
144 |
Data processing |
7,391 |
|
7,758 |
|
(367) |
Other professional services |
5,164 |
|
5,256 |
|
(92) |
Insurance and assessments |
3,685 |
|
3,745 |
|
(60) |
Intangible asset amortization |
2,890 |
|
2,889 |
|
1 |
Leased equipment depreciation |
8,603 |
|
8,614 |
|
(11) |
Foreclosed assets expense (income), net |
165 |
|
(119) |
|
284 |
Acquisition, integration and reorganization costs |
200 |
|
200 |
|
- |
Customer related expense |
4,538 |
|
4,973 |
|
(435) |
Loan expense |
4,180 |
|
4,031 |
|
149 |
Other |
9,616 |
|
8,812 |
|
804 |
Total noninterest expense |
$ |
159,421 |
|
$ |
151,750 |
|
$ |
7,671 |
|
|
|
|
|
|
Noninterest expense increased by $7.7 million to
$159.4 million for the third quarter of 2021 compared to $151.8
million for the second quarter of 2021 due primarily to an increase
of $7.3 million in compensation expense attributable mainly to
higher bonus and incentives expense related to increased warrant
income, the growth in loans and deposits in the third quarter of
2021, and overall year-to-date performance.
Income Taxes
The effective income tax rate was 25.4% in the
third quarter of 2021 compared to 25.7% in the second quarter of
2021. The effective income tax rate for the full year 2021 is
estimated to be in the range of 25% to 27%.
BALANCE SHEET HIGHLIGHTS
Deposits and Client Investment
Funds
The following table presents the composition of
our deposit portfolio as of the dates indicated:
|
|
|
|
|
|
|
|
|
|
September 30, 2021 |
|
June 30, 2021 |
|
September 30, 2020 |
|
|
% of |
|
|
% of |
|
|
% of |
Deposit
Composition |
Balance |
Total |
|
Balance |
Total |
|
Balance |
Total |
|
(Dollars in thousands) |
Noninterest-bearing demand |
$ |
12,881,806 |
42% |
|
$ |
11,252,286 |
38% |
|
$ |
9,346,744 |
39% |
Interest checking |
7,168,472 |
24% |
|
7,394,472 |
25% |
|
4,657,511 |
20% |
Money market |
7,463,261 |
24% |
|
7,777,199 |
26% |
|
6,539,313 |
27% |
Savings |
627,169 |
2% |
|
614,204 |
2% |
|
574,061 |
2% |
Total core deposits |
28,140,708 |
92% |
|
27,038,161 |
91% |
|
21,117,629 |
88% |
Non-core non-maturity
deposits |
960,438 |
3% |
|
1,122,971 |
4% |
|
1,123,909 |
5% |
Total non-maturity deposits |
29,101,146 |
95% |
|
28,161,132 |
95% |
|
22,241,538 |
93% |
Time deposits $250,000 and
under |
882,551 |
3% |
|
913,371 |
3% |
|
1,047,621 |
4% |
Time deposits over
$250,000 |
576,048 |
2% |
|
572,531 |
2% |
|
676,536 |
3% |
Total time deposits |
1,458,599 |
5% |
|
1,485,902 |
5% |
|
1,724,157 |
7% |
Total deposits |
$ |
30,559,745 |
100% |
|
$ |
29,647,034 |
100% |
|
$ |
23,965,695 |
100% |
At September 30, 2021, core deposits totaled $28.1
billion or 92% of total deposits, including $12.9 billion of
noninterest-bearing demand deposits or 42% of total deposits. Core
deposits increased by $1.1 billion or 4.1% in the third quarter of
2021 driven by continued strong deposit growth from our venture
banking and community banking clients.
In addition to deposit products, we also offer
alternative, non-depository cash investment options for select
clients. These alternative options include investments managed by
Pacific Western Asset Management Inc. (“PWAM”), our registered
investment advisor subsidiary, and third-party sweep products.
Total off-balance sheet client investment funds at September 30,
2021 were $1.4 billion, of which $1.0 billion was managed by
PWAM.
Loans and Leases
The following table presents roll forwards of
loans and leases held for investment, net of deferred fees, for the
periods indicated:
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
Roll Forward of Loans
and Leases Held |
September 30, |
|
June 30, |
|
September 30, |
for Investment, Net of
Deferred Fees (1) |
2021 |
|
2021 |
|
2021 |
|
(Dollars in thousands) |
Balance, beginning of period |
$ |
19,506,257 |
|
$ |
18,979,228 |
|
$ |
19,083,377 |
Additions: |
|
|
|
|
|
Production |
2,406,024 |
|
1,663,151 |
|
5,681,952 |
Disbursements |
1,349,333 |
|
1,662,644 |
|
4,034,963 |
Total production and disbursements |
3,755,357 |
|
3,325,795 |
|
9,716,915 |
Reductions: |
|
|
|
|
|
Payoffs |
(1,732,621) |
|
(1,969,118) |
|
(5,337,003) |
Paydowns |
(1,013,867) |
|
(802,222) |
|
(2,883,507) |
Total payoffs and paydowns |
(2,746,488) |
|
(2,771,340) |
|
(8,220,510) |
Sales |
(2,175) |
|
(26,610) |
|
(101,426) |
Transfers to foreclosed assets |
(415) |
|
- |
|
(1,062) |
Charge-offs |
(1,516) |
|
(816) |
|
(6,320) |
Transfers to loans held for sale |
- |
|
- |
|
(25,554) |
Total reductions |
(2,750,594) |
|
(2,798,766) |
|
(8,354,872) |
Loans acquired through Civic acquisition |
- |
|
- |
|
65,600 |
Net increase (decrease) |
1,004,763 |
|
527,029 |
|
1,427,643 |
Balance, end of period |
$ |
20,511,020 |
|
$ |
19,506,257 |
|
$ |
20,511,020 |
|
|
|
|
|
|
Weighted average rate on
production (2) |
4.24% |
|
4.55% |
|
4.37% |
|
|
|
|
|
|
(1) Includes
direct financing leases but excludes equipment leased to others
under operating leases. |
|
|
(2) The weighted
average rate on production presents contractual rates on a
tax equivalent basis and excludes amortized fees. Amortized
fees added approximately 40 basis points to loan yields in
2021. |
Loans and leases held for investment, net of
deferred fees, increased by $1.0 billion or 5.2% in the third
quarter of 2021 to $20.5 billion at September 30, 2021. Excluding
PPP loan activity, loans grew by $1.3 billion or 7.1%. The overall
increase in the loans and leases balance for the third quarter of
2021 was primarily due to increases in the income producing and
other residential, real estate construction and land and
asset-based portfolios partially offset by a reduction in the
venture capital portfolio and other commercial portfolio due to PPP
loan forgiveness. The PPP forgiveness in the third quarter of 2021
was $338 million, down from $506 million in the second quarter of
2021. Net fees for PPP loans were $7.9 million in the third quarter
of 2021 down slightly from the $8.8 million in the second quarter
of 2021. Remaining PPP loans totaled $272 million as of September
30, 2021 with $7.7 million of net fees to amortize over the
remaining life of the loans. The weighted average rate on the $2.4
billion of new production for the third quarter of 2021 decreased
to 4.24% from 4.55% in the second quarter of 2021 due to the loan
mix.
The following table presents the composition of
loans and leases held for investment by loan portfolio segment and
class, net of deferred fees, as of the dates indicated:
|
|
|
|
|
|
|
|
|
|
September 30, 2021 |
|
June 30, 2021 |
|
September 30, 2020 |
|
|
% of |
|
|
% of |
|
|
% of |
Loan and Lease
Portfolio |
Balance |
Total |
|
Balance |
Total |
|
Balance |
Total |
|
(In thousands) |
Real estate mortgage: |
|
|
|
|
|
|
|
|
Commercial |
$ |
3,694,597 |
18% |
|
$ |
3,792,198 |
19% |
|
$ |
4,192,466 |
22% |
Income producing and other |
|
|
|
|
|
|
|
|
residential |
5,886,360 |
29% |
|
4,620,822 |
24% |
|
3,684,579 |
19% |
Total real estate mortgage |
9,580,957 |
47% |
|
8,413,020 |
43% |
|
7,877,045 |
41% |
Real estate construction and
land: |
|
|
|
|
|
|
|
|
Commercial |
992,003 |
5% |
|
930,785 |
5% |
|
1,241,647 |
7% |
Residential |
2,659,870 |
13% |
|
2,574,799 |
13% |
|
2,182,100 |
11% |
Total real estate construction |
|
|
|
|
|
|
|
|
and land |
3,651,873 |
18% |
|
3,505,584 |
18% |
|
3,423,747 |
18% |
Total real estate |
13,232,830 |
65% |
|
11,918,604 |
61% |
|
11,300,792 |
59% |
Commercial: |
|
|
|
|
|
|
|
|
Asset-based |
3,661,769 |
18% |
|
3,550,903 |
18% |
|
3,153,048 |
17% |
Venture capital |
1,632,861 |
8% |
|
1,749,432 |
9% |
|
1,637,132 |
9% |
Other commercial |
1,577,592 |
7% |
|
1,921,909 |
10% |
|
2,572,994 |
13% |
Total commercial |
6,872,222 |
33% |
|
7,222,244 |
37% |
|
7,363,174 |
39% |
Consumer |
405,968 |
2% |
|
365,409 |
2% |
|
362,234 |
2% |
Total loans and leases held for |
|
|
|
|
|
|
|
|
investment, net of deferred fees |
$ |
20,511,020 |
100% |
|
$ |
19,506,257 |
100% |
|
$ |
19,026,200 |
100% |
|
|
|
|
|
|
|
|
|
Total unfunded loan
commitments |
$ |
8,480,599 |
|
|
$ |
7,891,875 |
|
|
$ |
7,178,506 |
|
Allowance for Credit Losses
The following tables present roll forwards of the
allowance for credit losses for the periods indicated:
|
|
|
|
|
|
|
Three Months Ended September 30, 2021 |
|
Allowance for |
|
Reserve for |
|
Total |
Allowance for
Credit |
Loan and |
|
Unfunded Loan |
|
Allowance for |
Losses
Rollforward |
Lease Losses |
|
Commitments |
|
Credit Losses |
|
(In thousands) |
Beginning balance |
$ |
225,600 |
|
$ |
74,571 |
|
$ |
300,171 |
Charge-offs |
(1,516) |
|
- |
|
(1,516) |
Recoveries |
1,149 |
|
- |
|
1,149 |
Net charge-offs |
(367) |
|
- |
|
(367) |
Provision |
(21,500) |
|
1,500 |
|
(20,000) |
Ending balance |
$ |
203,733 |
|
$ |
76,071 |
|
$ |
279,804 |
|
|
|
|
|
|
|
|
|
|
|
|
Net recoveries |
|
|
|
|
|
|
Three Months Ended June 30, 2021 |
|
Allowance for |
|
Reserve for |
|
Total |
Allowance for
Credit |
Loan and |
|
Unfunded Loan |
|
Allowance for |
Losses
Rollforward |
Lease Losses |
|
Commitments |
|
Credit Losses |
|
(In thousands) |
Beginning balance |
$ |
292,445 |
|
$ |
90,571 |
|
$ |
383,016 |
Charge-offs |
(816) |
|
- |
|
(816) |
Recoveries |
5,971 |
|
- |
|
5,971 |
Net recoveries |
5,155 |
|
- |
|
5,155 |
Provision |
(72,000) |
|
(16,000) |
|
(88,000) |
Ending balance |
$ |
225,600 |
|
$ |
74,571 |
|
$ |
300,171 |
The following table presents allowance for credit
losses information as of and for the dates and periods
indicated:
|
|
|
|
|
|
|
September 30, |
|
June 30, |
|
Increase |
Allowance for Credit
Losses |
2021 |
|
2021 |
|
(Decrease) |
|
(Dollars in thousands) |
Allowance for loan and lease losses |
$ |
203,733 |
|
$ |
225,600 |
|
$ |
(21,867) |
Reserve for unfunded loan commitments |
76,071 |
|
74,571 |
|
1,500 |
Allowance for credit losses |
$ |
279,804 |
|
$ |
300,171 |
|
$ |
(20,367) |
|
|
|
|
|
|
Provision for credit losses (for the quarter) |
$ |
(20,000) |
|
$ |
(88,000) |
|
$ |
68,000 |
Net charge-offs (recoveries) (for the quarter) |
$ |
367 |
|
$ |
(5,155) |
|
$ |
5,522 |
Net charge-offs (recoveries) to average loans |
|
|
|
|
|
and leases (for the quarter) |
0.01% |
|
(0.11)% |
|
|
Allowance for loan and lease losses to loans |
|
|
|
|
|
and leases held for investment |
0.99% |
|
1.16% |
|
|
Allowance for loan and lease losses to loans |
|
|
|
|
|
and leases held for investment, excluding PPP loans |
1.01% |
|
1.19% |
|
|
Allowance for credit losses to loans and leases |
|
|
|
|
|
held for investment |
1.36% |
|
1.54% |
|
|
Allowance for credit losses to loans and leases |
|
|
|
|
|
held for investment, excluding PPP loans |
1.38% |
|
1.59% |
|
|
The allowance for credit losses decreased by $20.4
million in the third quarter of 2021 to $279.8 million at September
30, 2021. The decrease in the allowance for credit losses during
the third quarter of 2021 was attributable to a provision for
credit losses benefit of $20.0 million and $0.4 million in net
charge-offs. The allowance for credit losses ratio, excluding PPP
loans, of 1.38% remains robust and significantly higher than the
pre-pandemic level of 0.97% as of the January 1, 2020 CECL adoption
date.
Net charge-offs were $0.4 million for the third
quarter of 2021. Gross charge-offs of $1.5 million were
reduced by recoveries of $1.1 million.
Net recoveries were $5.2 million for the second
quarter of 2021. Gross charge-offs of $0.8 million were
reduced by recoveries of $6.0 million.
On a year-to-date basis for the nine months ended
September 30, 2021, net recoveries were $2.1 million. Gross
charge-offs of $6.3 million were reduced by recoveries of $8.4
million.
CREDIT QUALITY
The following table presents loan and lease credit
quality metrics as of the dates indicated:
|
|
|
|
|
|
|
September 30, |
|
June 30, |
|
Increase |
Credit Quality
Metrics |
2021 |
|
2021 |
|
(Decrease) |
|
(Dollars in thousands) |
NPAs and Performing
TDRs: |
|
|
|
|
|
Nonaccrual loans and leases held for investment (1) |
$ |
64,507 |
|
$ |
56,803 |
|
$ |
7,704 |
Accruing loans contractually
past due 90 days or more |
- |
|
- |
|
- |
Foreclosed assets, net |
13,364 |
|
13,227 |
|
137 |
Total
nonperforming assets ("NPAs") |
$ |
77,871 |
|
$ |
70,030 |
|
$ |
7,841 |
|
|
|
|
|
|
Performing TDRs held for
investment |
$ |
36,750 |
|
$ |
40,129 |
|
$ |
(3,379) |
|
|
|
|
|
|
Nonaccrual loans and leases held for investment |
|
|
|
|
|
to loans and leases held for investment |
0.31% |
|
0.29% |
|
|
Nonperforming assets to loans and leases |
|
|
|
|
|
held for investment and foreclosed assets |
0.38% |
|
0.36% |
|
|
Allowance for credit losses to nonaccrual loans |
|
|
|
|
|
and leases held for investment |
433.8% |
|
528.4% |
|
|
|
|
|
|
|
|
Loan and Lease Credit
Risk Ratings: |
|
|
|
|
|
Pass |
$ |
19,873,050 |
|
$ |
18,822,938 |
|
$ |
1,050,112 |
Special mention |
496,366 |
|
536,052 |
|
(39,686) |
Classified |
141,604 |
|
147,267 |
|
(5,663) |
Total loans and leases held for investment, |
|
|
|
|
|
net of deferred fees |
$ |
20,511,020 |
|
$ |
19,506,257 |
|
$ |
1,004,763 |
|
|
|
|
|
|
Classified loans and leases held for investment |
|
|
|
|
|
to loans and leases held for investment |
0.69% |
|
0.75% |
|
|
|
|
|
|
|
|
(1) Nonaccrual
loans include SBA guaranteed amounts of $20.1 million at September
30, 2021 and $24.2 million at June 30, 2021. |
Since pro-actively downgrading certain loans at
the onset of the pandemic in the first quarter of 2020, special
mention loans and leases have decreased by $402.3 million from
their peak in the first quarter of 2020, while classified loans and
leases have decreased by $151.6 million from their peak in the
second quarter of 2020, and each have continued a steady decline in
the third quarter of 2021. Nonaccrual loans and leases increased by
$7.7 million to $64.5 million in the third quarter of 2021 due
primarily to an increase in nonaccrual short-term, single-family
residential renovation loans, however $7.5 million of such
nonaccrual loans paid off in the first week of October.
The following table presents nonaccrual loans and
leases and accruing loans and leases past due between 30 and 89
days by loan portfolio segment and class as of the dates
indicated:
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2021 |
|
June 30, 2021 |
|
Increase (Decrease) |
|
|
|
Accruing |
|
|
|
Accruing |
|
|
|
Accruing |
|
|
|
and 30-89 |
|
|
|
and 30-89 |
|
|
|
and 30-89 |
|
|
|
Days Past |
|
|
|
Days Past |
|
|
|
Days Past |
|
Nonaccrual |
|
Due |
|
Nonaccrual |
|
Due |
|
Nonaccrual |
|
Due |
|
(Dollars in thousands) |
Real estate mortgage: |
|
|
|
|
|
|
|
|
|
|
|
Commercial |
$ |
25,615 |
|
$ |
676 |
|
$ |
32,065 |
|
$
- |
|
$ |
(6,450) |
|
$ |
676 |
Income producing and other |
|
|
|
|
|
|
|
|
|
|
|
residential |
7,547 |
|
3,760 |
|
6,133 |
|
2,179 |
|
1,414 |
|
1,581 |
Total real estate mortgage |
33,162 |
|
4,436 |
|
38,198 |
|
2,179 |
|
(5,036) |
|
2,257 |
Real estate construction and
land: |
|
|
|
|
|
|
|
|
|
|
|
Commercial |
- |
|
- |
|
284 |
|
- |
|
(284) |
|
- |
Residential |
19,918 |
|
12,809 |
|
1,934 |
|
22,714 |
|
17,984 |
|
(9,905) |
Total real estate |
|
|
|
|
|
|
|
|
|
|
|
construction and land |
19,918 |
|
12,809 |
|
2,218 |
|
22,714 |
|
17,700 |
|
(9,905) |
Commercial: |
|
|
|
|
|
|
|
|
|
|
|
Asset-based |
1,605 |
|
- |
|
1,973 |
|
- |
|
(368) |
|
- |
Venture capital |
2,348 |
|
1,670 |
|
2,717 |
|
- |
|
(369) |
|
1,670 |
Other commercial |
6,979 |
|
340 |
|
11,337 |
|
270 |
|
(4,358) |
|
70 |
Total commercial |
10,932 |
|
2,010 |
|
16,027 |
|
270 |
|
(5,095) |
|
1,740 |
Consumer |
495 |
|
1,042 |
|
360 |
|
1,454 |
|
135 |
|
(412) |
Total held for investment |
$ |
64,507 |
|
$ |
20,297 |
|
$ |
56,803 |
|
$ |
26,617 |
|
$ |
7,704 |
|
$ |
(6,320) |
CAPITAL
The following table presents certain actual
capital ratios and ratios excluding PPP loans:
|
|
|
|
|
|
|
September 30, 2021 |
|
|
|
|
|
Excluding |
|
June 30, |
|
|
|
PPP |
|
2021 |
|
Actual (1) |
|
Loans (1) |
|
Actual |
PacWest Bancorp
Consolidated: |
|
|
|
|
|
Tier 1 leverage capital ratio |
8.05% |
(3) |
8.15% |
(4) |
7.67% |
Common equity tier 1 capital ratio |
10.15% |
|
10.15% |
|
10.41% |
Tier 1 capital ratio |
10.65% |
(3) |
10.65% |
|
10.41% |
Total capital ratio |
14.36% |
|
14.36% |
|
14.99% |
Tangible common equity ratio (2) |
7.79% |
|
7.85% |
(4) |
7.80% |
|
|
|
|
|
|
(1) Capital
information for September 30, 2021 is preliminary. |
|
|
|
|
(2) Non-GAAP measure. |
|
|
|
|
|
(3) The increase
in our consolidated Tier 1 capital ratio during the third quarter
of 2021 was due in part to a reassessment of a Basel III
implementation rule that permitted the grandfathering of
certain trust preferred securities as Tier 1 capital. As a
result, $131 million of trust preferred securities were
reclassified from Tier 2 capital to Tier 1 capital during the third
quarter of 2021. This change increased the Tier 1 leverage
capital ratio by approximately 38 basis points and increased
the Tier 1 capital ratio by approximately 50 basis
points. |
(4) PPP loans have been excluded from total assets in the
denominator as they are zero risk-weighted. |
ABOUT PACWEST BANCORP
PacWest Bancorp (“PacWest”) is a bank holding
company with over $35 billion in assets headquartered in Los
Angeles, California, with an executive office in Denver, Colorado,
with one wholly-owned banking subsidiary, Pacific Western Bank (the
“Bank”). The Bank has 69 full-service branches located in
California, one branch located in Durham, North Carolina, and one
branch located in Denver, Colorado. The Bank provides community
banking products including lending and comprehensive deposit and
treasury management services to small and medium-sized businesses
conducted primarily through our California-based branch offices and
Denver, Colorado branch office. The Bank offers national lending
products including asset-based, equipment, and real estate loans
and treasury management services to established middle-market
businesses on a national basis. The Bank provides venture banking
products including a comprehensive suite of financial services
focused on entrepreneurial and venture-backed businesses and their
venture capital and private equity investors, with offices located
in key innovative hubs across the United States. The Bank also
offers financing of non-owner-occupied investor properties through
Civic Financial Services a wholly-owned subsidiary. The Bank also
offers a specialized suite of services for the HOA industry. For
more information about PacWest Bancorp or Pacific Western Bank,
visit www.pacwest.com.
FORWARD LOOKING STATEMENTS
This communication contains certain
forward-looking information about PacWest that is intended to be
covered by the safe harbor for “forward-looking statements”
provided by the Private Securities Litigation Reform Act of 1995.
Statements that are not historical or current facts, including
statements about future financial and operational results,
expectations, or intentions are forward-looking statements. Such
statements are based on information available at the time of the
communication and are based on current beliefs and expectations of
the Company’s management and are subject to significant risks,
uncertainties and contingencies, many of which are beyond our
control. The ongoing COVID-19 pandemic has adversely affected
PacWest, its employees, customers and third-party service
providers, and the ultimate extent of the impacts on its business,
financial position, results of operations, liquidity and prospects
is uncertain. The risks from the COVID-19 pandemic have decreased
as the pandemic subsides, however, new variants may continue to
impact key macro-economic indicators such as unemployment and GDP
and may have a material impact on our allowance for credit losses
and related provision for credit losses. Continued deterioration in
general business and economic conditions could adversely affect
PacWest’s revenues and the values of its assets, including
goodwill, and liabilities, lead to a tightening of credit, and
increase stock price volatility. In addition, PacWest’s results
could be adversely affected by changes in interest rates, sustained
high unemployment rates, deterioration in the credit quality of its
loan portfolio or in the value of the collateral securing those
loans, deterioration in the value of its investment securities, the
magnitude of individual loan losses on security monitoring loans,
and legal and regulatory developments. Actual results may differ
materially from those set forth or implied in the forward-looking
statements due to a variety of factors, including the risk factors
described in documents filed by PacWest with the U.S. Securities
and Exchange Commission.
We are under no obligation (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 |
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
June 30, |
|
September 30, |
|
2021 |
|
2021 |
|
2020 |
|
(Dollars in thousands, except per share data) |
ASSETS: |
|
|
|
|
|
Cash and due from banks |
$ |
174,585 |
|
$ |
179,505 |
|
$ |
187,176 |
Interest-earning deposits in
financial institutions |
3,524,613 |
|
5,678,587 |
|
2,766,020 |
Total cash and cash equivalents |
3,699,198 |
|
5,858,092 |
|
2,953,196 |
|
|
|
|
|
|
Securities available-for-sale,
at estimated fair value |
9,276,926 |
|
7,198,608 |
|
4,532,614 |
Federal Home Loan Bank stock,
at cost |
17,250 |
|
17,250 |
|
17,250 |
Total investment securities |
9,294,176 |
|
7,215,858 |
|
4,549,864 |
|
|
|
|
|
|
Loans held for
sale |
- |
|
- |
|
- |
|
|
|
|
|
|
Gross loans and leases held
for investment |
20,588,255 |
|
19,580,731 |
|
19,101,680 |
Deferred fees, net |
(77,235) |
|
(74,474) |
|
(75,480) |
Total loans and leases held for investment, |
|
|
|
|
|
net of deferred fees |
20,511,020 |
|
19,506,257 |
|
19,026,200 |
Allowance for loan and lease
losses |
(203,733) |
|
(225,600) |
|
(345,966) |
Total loans and leases held for investment,
net |
20,307,287 |
|
19,280,657 |
|
18,680,234 |
|
|
|
|
|
|
Equipment leased to others
under operating leases |
334,275 |
|
313,574 |
|
286,425 |
Premises and equipment,
net |
47,246 |
|
39,541 |
|
40,544 |
Foreclosed assets, net |
13,364 |
|
13,227 |
|
13,747 |
Goodwill |
1,204,118 |
|
1,204,118 |
|
1,078,670 |
Core deposit and customer
relationship intangibles, net |
15,533 |
|
18,423 |
|
26,813 |
Other assets |
970,479 |
|
924,497 |
|
797,223 |
Total assets |
$ |
35,885,676 |
|
$ |
34,867,987 |
|
$ |
28,426,716 |
|
|
|
|
|
|
LIABILITIES: |
|
|
|
|
|
Noninterest-bearing
deposits |
$ |
12,881,806 |
|
$ |
11,252,286 |
|
$ |
9,346,744 |
Interest-bearing deposits |
17,677,939 |
|
18,394,748 |
|
14,618,951 |
Total deposits |
30,559,745 |
|
29,647,034 |
|
23,965,695 |
Borrowings |
- |
|
6,625 |
|
60,000 |
Subordinated debt |
862,447 |
|
861,788 |
|
463,282 |
Accrued interest payable and
other liabilities |
545,050 |
|
505,859 |
|
451,508 |
Total liabilities |
31,967,242 |
|
31,021,306 |
|
24,940,485 |
STOCKHOLDERS' EQUITY
(1) |
3,918,434 |
|
3,846,681 |
|
3,486,231 |
Total liabilities and stockholders’ equity |
$ |
35,885,676 |
|
$ |
34,867,987 |
|
$ |
28,426,716 |
|
|
|
|
|
|
Book value per share |
$ |
32.77 |
|
$ |
32.17 |
|
$ |
29.42 |
Tangible book value per share
(2) |
$ |
22.57 |
|
$ |
21.95 |
|
$ |
20.09 |
Shares outstanding |
119,579,566 |
|
119,555,102 |
|
118,489,927 |
|
|
|
|
|
|
(1) Includes net unrealized
gain on securities |
|
|
|
|
|
available-for-sale, net |
$ |
98,859 |
|
$ |
145,516 |
|
$ |
155,474 |
(2) Non-GAAP measure. |
|
|
|
|
|
PACWEST BANCORP AND
SUBSIDIARIES |
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENT OF EARNINGS (LOSS) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
2021 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(Dollars in thousands, except per share data) |
Interest
income: |
|
|
|
|
|
|
|
|
|
Loans and leases |
$ |
246,722 |
|
$ |
244,529 |
|
$ |
240,811 |
|
$ |
732,795 |
|
$ |
750,940 |
Investment securities |
40,780 |
|
33,954 |
|
24,443 |
|
104,999 |
|
77,927 |
Deposits in financial
institutions |
2,580 |
|
2,022 |
|
654 |
|
6,130 |
|
2,448 |
Total interest income |
290,082 |
|
280,505 |
|
265,908 |
|
843,924 |
|
831,315 |
|
|
|
|
|
|
|
|
|
|
Interest
expense: |
|
|
|
|
|
|
|
|
|
Deposits |
6,417 |
|
7,269 |
|
9,887 |
|
21,186 |
|
51,209 |
Borrowings |
101 |
|
265 |
|
27 |
|
559 |
|
8,124 |
Subordinated debt |
7,722 |
|
6,663 |
|
4,670 |
|
18,760 |
|
16,632 |
Total interest expense |
14,240 |
|
14,197 |
|
14,584 |
|
40,505 |
|
75,965 |
|
|
|
|
|
|
|
|
|
|
Net interest income |
275,842 |
|
266,308 |
|
251,324 |
|
803,419 |
|
755,350 |
Provision for credit
losses |
(20,000) |
|
(88,000) |
|
97,000 |
|
(156,000) |
|
329,000 |
Net interest income after provision |
|
|
|
|
|
|
|
|
|
for credit losses |
295,842 |
|
354,308 |
|
154,324 |
|
959,419 |
|
426,350 |
|
|
|
|
|
|
|
|
|
|
Noninterest
income: |
|
|
|
|
|
|
|
|
|
Service charges on deposit
accounts |
3,407 |
|
3,452 |
|
2,570 |
|
9,793 |
|
7,232 |
Other commissions and
fees |
11,792 |
|
10,704 |
|
10,541 |
|
31,654 |
|
30,373 |
Leased equipment income |
10,943 |
|
10,847 |
|
9,900 |
|
33,144 |
|
34,188 |
Gain on sale of loans and
leases |
- |
|
1,422 |
|
35 |
|
1,561 |
|
468 |
Gain on sale of
securities |
515 |
|
- |
|
5,270 |
|
616 |
|
13,167 |
Other income |
24,688 |
|
13,946 |
|
9,936 |
|
59,777 |
|
20,782 |
Total noninterest income |
51,345 |
|
40,371 |
|
38,252 |
|
136,545 |
|
106,210 |
|
|
|
|
|
|
|
|
|
|
Noninterest
expense: |
|
|
|
|
|
|
|
|
|
Compensation |
98,061 |
|
90,807 |
|
75,131 |
|
268,750 |
|
198,323 |
Occupancy |
14,928 |
|
14,784 |
|
14,771 |
|
43,766 |
|
43,472 |
Data processing |
7,391 |
|
7,758 |
|
6,505 |
|
22,106 |
|
20,061 |
Other professional
services |
5,164 |
|
5,256 |
|
4,713 |
|
15,546 |
|
13,117 |
Insurance and assessments |
3,685 |
|
3,745 |
|
3,939 |
|
12,333 |
|
17,561 |
Intangible asset
amortization |
2,890 |
|
2,889 |
|
3,751 |
|
8,858 |
|
11,581 |
Leased equipment
depreciation |
8,603 |
|
8,614 |
|
7,057 |
|
26,186 |
|
21,364 |
Foreclosed assets expense
(income), net |
165 |
|
(119) |
|
335 |
|
47 |
|
255 |
Acquisition, integration
and |
|
|
|
|
|
|
|
|
|
reorganization costs |
200 |
|
200 |
|
- |
|
3,825 |
|
- |
Customer related expense |
4,538 |
|
4,973 |
|
4,762 |
|
14,329 |
|
13,102 |
Loan expense |
4,180 |
|
4,031 |
|
3,499 |
|
11,404 |
|
9,528 |
Goodwill impairment |
- |
|
- |
|
- |
|
- |
|
1,470,000 |
Other expense |
9,616 |
|
8,812 |
|
8,939 |
|
34,157 |
|
29,973 |
Total noninterest expense |
159,421 |
|
151,750 |
|
133,402 |
|
461,307 |
|
1,848,337 |
|
|
|
|
|
|
|
|
|
|
Earnings (loss) before income
taxes |
187,766 |
|
242,929 |
|
59,174 |
|
634,657 |
|
(1,315,777) |
Income tax expense |
47,770 |
|
62,417 |
|
13,671 |
|
163,743 |
|
38,627 |
Net earnings (loss) |
$ |
139,996 |
|
$ |
180,512 |
|
$ |
45,503 |
|
$ |
470,914 |
|
$ |
(1,354,404) |
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings (loss)
per share |
$ |
1.17 |
|
$ |
1.52 |
|
$ |
0.38 |
|
$ |
3.96 |
|
$ |
(11.60) |
Dividends declared and paid per
share |
$ |
0.25 |
|
$ |
0.25 |
|
$ |
0.25 |
|
$ |
0.75 |
|
$ |
1.10 |
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
2021 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(In thousands, except per share data) |
Basic Earnings (Loss)
Per Share: |
|
|
|
|
|
|
|
|
|
Net earnings (loss) |
$ |
139,996 |
|
$ |
180,512 |
|
$ |
45,503 |
|
$ |
470,914 |
|
$ |
(1,354,404) |
Less: earnings allocated to |
|
|
|
|
|
|
|
|
|
unvested restricted stock (1) |
(2,417) |
|
(3,172) |
|
(578) |
|
(7,930) |
|
(1,603) |
Net earnings (loss) allocated to |
|
|
|
|
|
|
|
|
|
common shares |
$ |
137,579 |
|
$ |
177,340 |
|
$ |
44,925 |
|
$ |
462,984 |
|
$ |
(1,356,007) |
|
|
|
|
|
|
|
|
|
|
Weighted average basic shares |
|
|
|
|
|
|
|
|
|
and unvested restricted stock |
|
|
|
|
|
|
|
|
|
outstanding |
119,569 |
|
119,386 |
|
118,438 |
|
119,272 |
|
118,469 |
Less: weighted average unvested |
|
|
|
|
|
|
|
|
|
restricted stock outstanding |
(2,340) |
|
(2,356) |
|
(1,684) |
|
(2,235) |
|
(1,596) |
Weighted average basic shares |
|
|
|
|
|
|
|
|
|
outstanding |
117,229 |
|
117,030 |
|
116,754 |
|
117,037 |
|
116,873 |
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per share |
$ |
1.17 |
|
$ |
1.52 |
|
$ |
0.38 |
|
$ |
3.96 |
|
$ |
(11.60) |
|
|
|
|
|
|
|
|
|
|
Diluted Earnings
(Loss) Per Share: |
|
|
|
|
|
|
|
|
|
Net earnings (loss) allocated to |
|
|
|
|
|
|
|
|
|
common shares |
$ |
137,579 |
|
$ |
177,340 |
|
$ |
44,925 |
|
$ |
462,984 |
|
$ |
(1,356,007) |
|
|
|
|
|
|
|
|
|
|
Weighted average diluted shares |
|
|
|
|
|
|
|
|
|
outstanding |
117,229 |
|
117,030 |
|
116,754 |
|
117,037 |
|
116,873 |
|
|
|
|
|
|
|
|
|
|
Diluted earnings (loss) per share |
$ |
1.17 |
|
$ |
1.52 |
|
$ |
0.38 |
|
$ |
3.96 |
|
$ |
(11.60) |
|
|
|
|
|
|
|
|
|
|
(1) Represents
cash dividends paid to holders of unvested stock, net of
forfeitures, plus undistributed earnings amounts available to
holders of unvested restricted stock, if any. |
|
PACWEST
BANCORP AND SUBSIDIARIES |
|
|
|
|
|
|
|
|
|
AVERAGE
BALANCE SHEET AND YIELD ANALYSIS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
September 30, 2021 |
|
June 30, 2021 |
|
September 30, 2020 |
|
|
Interest |
Average |
|
|
Interest |
Average |
|
|
Interest |
Average |
|
Average |
Income/ |
Yield/ |
|
Average |
Income/ |
Yield/ |
|
Average |
Income/ |
Yield/ |
|
Balance |
Expense |
Cost |
|
Balance |
Expense |
Cost |
|
Balance |
Expense |
Cost |
|
(Dollars in thousands) |
Assets: |
|
|
|
|
|
|
|
|
|
|
|
Loans and leases (1)(2) |
$ |
19,670,671 |
$ |
248,485 |
5.01% |
|
$ |
19,057,420 |
$ |
246,147 |
5.18% |
|
$ |
19,195,737 |
$ |
241,547 |
5.01% |
Investment securities (3) |
8,047,098 |
42,952 |
2.12% |
|
6,492,721 |
36,111 |
2.23% |
|
4,107,915 |
26,015 |
2.52% |
Deposits in
financial |
|
|
|
|
|
|
|
|
|
|
|
institutions |
5,657,768 |
2,580 |
0.18% |
|
6,347,764 |
2,022 |
0.13% |
|
2,554,349 |
654 |
0.10% |
Total interest-earning |
|
|
|
|
|
|
|
|
|
|
|
assets (1) |
33,375,537 |
294,017 |
3.50% |
|
31,897,905 |
284,280 |
3.57% |
|
25,858,001 |
268,216 |
4.13% |
Other assets |
2,496,127 |
|
|
|
2,428,207 |
|
|
|
2,077,192 |
|
|
Total assets |
$ |
35,871,664 |
|
|
|
$ |
34,326,112 |
|
|
|
$ |
27,935,193 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
and |
|
|
|
|
|
|
|
|
|
|
|
Stockholders' Equity: |
|
|
|
|
|
|
|
|
|
|
Interest checking |
$ |
7,372,859 |
2,042 |
0.11% |
|
$ |
7,235,726 |
2,394 |
0.13% |
|
$ |
4,904,614 |
2,019 |
0.16% |
Money market |
8,662,449 |
2,997 |
0.14% |
|
8,484,933 |
3,318 |
0.16% |
|
7,170,842 |
3,081 |
0.17% |
Savings |
620,079 |
38 |
0.02% |
|
598,225 |
36 |
0.02% |
|
565,395 |
35 |
0.02% |
Time |
1,475,307 |
1,340 |
0.36% |
|
1,498,169 |
1,521 |
0.41% |
|
1,876,072 |
4,752 |
1.01% |
Total interest-bearing |
|
|
|
|
|
|
|
|
|
|
|
deposits |
18,130,694 |
6,417 |
0.14% |
|
17,817,053 |
7,269 |
0.16% |
|
14,516,923 |
9,887 |
0.27% |
Borrowings |
238,335 |
101 |
0.17% |
|
225,446 |
265 |
0.47% |
|
181,315 |
27 |
0.06% |
Subordinated debt |
862,272 |
7,722 |
3.55% |
|
735,725 |
6,663 |
3.63% |
|
462,375 |
4,670 |
4.02% |
Total interest-bearing |
|
|
|
|
|
|
|
|
|
|
|
liabilities |
19,231,301 |
14,240 |
0.29% |
|
18,778,224 |
14,197 |
0.30% |
|
15,160,613 |
14,584 |
0.38% |
Noninterest-bearing |
|
|
|
|
|
|
|
|
|
|
|
demand deposits |
12,198,313 |
|
|
|
11,304,757 |
|
|
|
8,812,391 |
|
|
Other liabilities |
525,429 |
|
|
|
504,089 |
|
|
|
464,320 |
|
|
Total liabilities |
31,955,043 |
|
|
|
30,587,070 |
|
|
|
24,437,324 |
|
|
Stockholders' equity |
3,916,621 |
|
|
|
3,739,042 |
|
|
|
3,497,869 |
|
|
Total liabilities and |
|
|
|
|
|
|
|
|
|
|
|
stockholders' equity |
$ |
35,871,664 |
|
|
|
$ |
34,326,112 |
|
|
|
$ |
27,935,193 |
|
|
Net interest income (1) |
|
$ |
279,777 |
|
|
|
$ |
270,083 |
|
|
|
$ |
253,632 |
|
Net interest spread (1) |
|
|
3.21% |
|
|
|
3.27% |
|
|
|
3.75% |
Net interest margin (1) |
|
|
3.33% |
|
|
|
3.40% |
|
|
|
3.90% |
|
|
|
|
|
|
|
|
|
|
|
|
Total deposits (4) |
$ |
30,329,007 |
$ |
6,417 |
0.08% |
|
$ |
29,121,810 |
$ |
7,269 |
0.10% |
|
$ |
23,329,314 |
$ |
9,887 |
0.17% |
|
|
|
|
|
|
|
|
|
|
|
|
(1) Tax equivalent. |
|
|
|
|
|
|
|
|
|
|
|
(2) Includes net
loan premium amortization of $2.4 million and $1.5 million and net
loan discount accretion of $35,000 for the three months ended
September 30, 2021, June 30, 2021, and September 30, 2020,
respectively. |
(3) Includes
tax-equivalent adjustments of $2.2 million, $2.2 million, and $1.6
million for the three months ended September 30,
2021, June 30, 2021, and September 30, 2020
related to tax-exempt income on investment
securities. The federal statutory tax rate utilized was
21%. |
(4) Total
deposits is the sum of total interest-bearing deposits and
noninterest-bearing demand deposits. The cost of total
deposits is calculated as annualized interest expense on total
deposits divided by average total deposits. |
PACWEST BANCORP AND
SUBSIDIARIES |
|
|
|
|
|
|
|
|
|
FIVE QUARTER BALANCE
SHEET |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
2021 |
|
2021 |
|
2021 |
|
2020 |
|
2020 |
|
(Dollars in thousands, except per share data) |
ASSETS: |
|
|
|
|
|
|
|
|
|
Cash and due from banks |
$ |
174,585 |
|
$ |
179,505 |
|
$ |
177,199 |
|
$ |
150,464 |
|
$ |
187,176 |
Interest-earning deposits in
financial |
|
|
|
|
|
|
|
|
|
institutions |
3,524,613 |
|
5,678,587 |
|
5,517,667 |
|
3,010,197 |
|
2,766,020 |
Total cash and cash equivalents |
3,699,198 |
|
5,858,092 |
|
5,694,866 |
|
3,160,661 |
|
2,953,196 |
|
|
|
|
|
|
|
|
|
|
Securities
available-for-sale |
9,276,926 |
|
7,198,608 |
|
5,941,690 |
|
5,235,591 |
|
4,532,614 |
Federal Home Loan Bank
stock |
17,250 |
|
17,250 |
|
17,250 |
|
17,250 |
|
17,250 |
Total
investment securities |
9,294,176 |
|
7,215,858 |
|
5,958,940 |
|
5,252,841 |
|
4,549,864 |
|
|
|
|
|
|
|
|
|
|
Loans held for
sale |
- |
|
- |
|
25,554 |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
|
Gross loans and leases held
for investment |
20,588,255 |
|
19,580,731 |
|
19,055,165 |
|
19,153,357 |
|
19,101,680 |
Deferred fees, net |
(77,235) |
|
(74,474) |
|
(75,937) |
|
(69,980) |
|
(75,480) |
Total loans and leases held for |
|
|
|
|
|
|
|
|
|
investment, net of deferred fees |
20,511,020 |
|
19,506,257 |
|
18,979,228 |
|
19,083,377 |
|
19,026,200 |
Allowance for loan and lease
losses |
(203,733) |
|
(225,600) |
|
(292,445) |
|
(348,181) |
|
(345,966) |
Total loans and leases held for |
|
|
|
|
|
|
|
|
|
investment, net |
20,307,287 |
|
19,280,657 |
|
18,686,783 |
|
18,735,196 |
|
18,680,234 |
|
|
|
|
|
|
|
|
|
|
Equipment leased to others
under |
|
|
|
|
|
|
|
|
|
operating leases |
334,275 |
|
313,574 |
|
327,413 |
|
333,846 |
|
286,425 |
Premises and equipment,
net |
47,246 |
|
39,541 |
|
39,622 |
|
39,234 |
|
40,544 |
Foreclosed assets, net |
13,364 |
|
13,227 |
|
14,298 |
|
14,027 |
|
13,747 |
Goodwill |
1,204,118 |
|
1,204,118 |
|
1,204,092 |
|
1,078,670 |
|
1,078,670 |
Core deposit and customer
relationship |
|
|
|
|
|
|
|
|
|
intangibles, net |
15,533 |
|
18,423 |
|
21,312 |
|
23,641 |
|
26,813 |
Other assets |
970,479 |
|
924,497 |
|
883,653 |
|
860,326 |
|
797,223 |
Total assets |
$ |
35,885,676 |
|
$ |
34,867,987 |
|
$ |
32,856,533 |
|
$ |
29,498,442 |
|
$ |
28,426,716 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES: |
|
|
|
|
|
|
|
|
|
Noninterest-bearing
deposits |
$ |
12,881,806 |
|
$ |
11,252,286 |
|
$ |
11,017,462 |
|
$ |
9,193,827 |
|
$ |
9,346,744 |
Interest-bearing deposits |
17,677,939 |
|
18,394,748 |
|
17,205,829 |
|
15,746,890 |
|
14,618,951 |
Total deposits |
30,559,745 |
|
29,647,034 |
|
28,223,291 |
|
24,940,717 |
|
23,965,695 |
Borrowings |
- |
|
6,625 |
|
19,750 |
|
5,000 |
|
60,000 |
Subordinated debt |
862,447 |
|
861,788 |
|
465,814 |
|
465,812 |
|
463,282 |
Accrued interest payable and
other |
|
|
|
|
|
|
|
|
|
liabilities |
545,050 |
|
505,859 |
|
493,541 |
|
491,962 |
|
451,508 |
Total liabilities |
31,967,242 |
|
31,021,306 |
|
29,202,396 |
|
25,903,491 |
|
24,940,485 |
STOCKHOLDERS' EQUITY
(1) |
3,918,434 |
|
3,846,681 |
|
3,654,137 |
|
3,594,951 |
|
3,486,231 |
Total liabilities and stockholders’ |
|
|
|
|
|
|
|
|
|
equity |
$ |
35,885,676 |
|
$ |
34,867,987 |
|
$ |
32,856,533 |
|
$ |
29,498,442 |
|
$ |
28,426,716 |
|
|
|
|
|
|
|
|
|
|
Book value per share |
$ |
32.77 |
|
$ |
32.17 |
|
$ |
30.68 |
|
$ |
30.36 |
|
$ |
29.42 |
Tangible book value per share
(2) |
$ |
22.57 |
|
$ |
21.95 |
|
$ |
20.39 |
|
$ |
21.05 |
|
$ |
20.09 |
Shares outstanding |
119,579,566 |
|
119,555,102 |
|
119,105,642 |
|
118,414,853 |
|
118,489,927 |
|
|
|
|
|
|
|
|
|
|
(1) Includes net unrealized
gain on |
|
|
|
|
|
|
|
|
|
securities available-for-sale, net |
$ |
98,859 |
|
$ |
145,516 |
|
$ |
106,381 |
|
$ |
172,523 |
|
$ |
155,474 |
(2) Non-GAAP measure. |
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
2021 |
|
2021 |
|
2021 |
|
2020 |
|
2020 |
|
(Dollars in thousands, except per share data) |
Interest
income: |
|
|
|
|
|
|
|
|
|
Loans and leases |
$ |
246,722 |
|
$ |
244,529 |
|
$ |
241,544 |
|
$ |
242,198 |
|
$ |
240,811 |
Investment securities |
40,780 |
|
33,954 |
|
30,265 |
|
28,843 |
|
24,443 |
Deposits in financial
institutions |
2,580 |
|
2,022 |
|
1,528 |
|
1,135 |
|
654 |
Total interest income |
290,082 |
|
280,505 |
|
273,337 |
|
272,176 |
|
265,908 |
|
|
|
|
|
|
|
|
|
|
Interest
expense: |
|
|
|
|
|
|
|
|
|
Deposits |
6,417 |
|
7,269 |
|
7,500 |
|
8,454 |
|
9,887 |
Borrowings |
101 |
|
265 |
|
193 |
|
37 |
|
27 |
Subordinated debt |
7,722 |
|
6,663 |
|
4,375 |
|
4,477 |
|
4,670 |
Total interest expense |
14,240 |
|
14,197 |
|
12,068 |
|
12,968 |
|
14,584 |
|
|
|
|
|
|
|
|
|
|
Net interest income |
275,842 |
|
266,308 |
|
261,269 |
|
259,208 |
|
251,324 |
Provision for credit
losses |
(20,000) |
|
(88,000) |
|
(48,000) |
|
10,000 |
|
97,000 |
Net interest income after provision |
|
|
|
|
|
|
|
|
|
for credit losses |
295,842 |
|
354,308 |
|
309,269 |
|
249,208 |
|
154,324 |
|
|
|
|
|
|
|
|
|
|
Noninterest
income: |
|
|
|
|
|
|
|
|
|
Service charges on deposit
accounts |
3,407 |
|
3,452 |
|
2,934 |
|
3,119 |
|
2,570 |
Other commissions and
fees |
11,792 |
|
10,704 |
|
9,158 |
|
9,974 |
|
10,541 |
Leased equipment income |
10,943 |
|
10,847 |
|
11,354 |
|
9,440 |
|
9,900 |
Gain on sale of loans and
leases |
- |
|
1,422 |
|
139 |
|
1,671 |
|
35 |
Gain on sale of
securities |
515 |
|
- |
|
101 |
|
4 |
|
5,270 |
Other income |
24,688 |
|
13,946 |
|
21,143 |
|
15,642 |
|
9,936 |
Total noninterest income |
51,345 |
|
40,371 |
|
44,829 |
|
39,850 |
|
38,252 |
|
|
|
|
|
|
|
|
|
|
Noninterest
expense: |
|
|
|
|
|
|
|
|
|
Compensation |
98,061 |
|
90,807 |
|
79,882 |
|
73,171 |
|
75,131 |
Occupancy |
14,928 |
|
14,784 |
|
14,054 |
|
14,083 |
|
14,771 |
Data processing |
7,391 |
|
7,758 |
|
6,957 |
|
6,718 |
|
6,505 |
Other professional
services |
5,164 |
|
5,256 |
|
5,126 |
|
6,800 |
|
4,713 |
Insurance and assessments |
3,685 |
|
3,745 |
|
4,903 |
|
5,064 |
|
3,939 |
Intangible asset
amortization |
2,890 |
|
2,889 |
|
3,079 |
|
3,172 |
|
3,751 |
Leased equipment
depreciation |
8,603 |
|
8,614 |
|
8,969 |
|
7,501 |
|
7,057 |
Foreclosed assets expense
(income), net |
165 |
|
(119) |
|
1 |
|
(272) |
|
335 |
Acquisition, integration
and |
|
|
|
|
|
|
|
|
|
reorganization costs |
200 |
|
200 |
|
3,425 |
|
1,060 |
|
- |
Customer related expense |
4,538 |
|
4,973 |
|
4,818 |
|
4,430 |
|
4,762 |
Loan expense |
4,180 |
|
4,031 |
|
3,193 |
|
3,926 |
|
3,499 |
Other expense |
9,616 |
|
8,812 |
|
15,729 |
|
10,029 |
|
8,939 |
Total noninterest expense |
159,421 |
|
151,750 |
|
150,136 |
|
135,682 |
|
133,402 |
|
|
|
|
|
|
|
|
|
|
Earnings before income
taxes |
187,766 |
|
242,929 |
|
203,962 |
|
153,376 |
|
59,174 |
Income tax expense |
47,770 |
|
62,417 |
|
53,556 |
|
36,546 |
|
13,671 |
Net earnings |
$ |
139,996 |
|
$ |
180,512 |
|
$ |
150,406 |
|
$ |
116,830 |
|
$ |
45,503 |
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per
share |
$ |
1.17 |
|
$ |
1.52 |
|
$ |
1.27 |
|
$ |
0.99 |
|
$ |
0.38 |
Dividends declared and paid per
share |
$ |
0.25 |
|
$ |
0.25 |
|
$ |
0.25 |
|
$ |
0.25 |
|
$ |
0.25 |
PACWEST BANCORP AND
SUBSIDIARIES |
|
|
|
|
|
|
|
|
|
FIVE
QUARTER SELECTED FINANCIAL DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At or For the Three Months Ended |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
2021 |
|
2021 |
|
2021 |
|
2020 |
|
2020 |
|
(Dollars in
thousands) |
Performance
Ratios: |
|
|
|
|
|
|
|
|
|
Return on average assets (1) |
1.55% |
|
2.11% |
|
1.94% |
|
1.58% |
|
0.65% |
Pre-provision, pre-goodwill impairment, |
|
|
|
|
|
|
|
|
|
pre-tax net revenue ("PPNR") |
|
|
|
|
|
|
|
|
|
return on average assets (1)(2) |
1.86% |
|
1.81% |
|
2.01% |
|
2.22% |
|
2.22% |
Return on average equity (1) |
14.18% |
|
19.36% |
|
16.86% |
|
13.14% |
|
5.18% |
Return on average tangible equity (1)(2) |
21.03% |
|
29.25% |
|
25.67% |
|
19.63% |
|
8.20% |
Efficiency ratio |
47.2% |
|
47.9% |
|
46.4% |
|
43.6% |
|
45.1% |
Noninterest expense as a percentage |
|
|
|
|
|
|
|
|
|
of average assets (1) |
1.76% |
|
1.77% |
|
1.94% |
|
1.84% |
|
1.90% |
|
|
|
|
|
|
|
|
|
|
Average Yields/Costs (1): |
|
|
|
|
|
|
|
|
|
Yield on: |
|
|
|
|
|
|
|
|
|
Average loans and leases (3) |
5.01% |
|
5.18% |
|
5.20% |
|
5.15% |
|
5.01% |
Average investment securities (3) |
2.12% |
|
2.23% |
|
2.44% |
|
2.50% |
|
2.52% |
Average interest-earning assets (3) |
3.50% |
|
3.57% |
|
3.86% |
|
4.02% |
|
4.13% |
Cost of: |
|
|
|
|
|
|
|
|
|
Average interest-bearing deposits |
0.14% |
|
0.16% |
|
0.18% |
|
0.22% |
|
0.27% |
Average total deposits |
0.08% |
|
0.10% |
|
0.11% |
|
0.14% |
|
0.17% |
Average interest-bearing liabilities |
0.29% |
|
0.30% |
|
0.29% |
|
0.33% |
|
0.38% |
Net interest spread (3) |
3.21% |
|
3.27% |
|
3.57% |
|
3.69% |
|
3.75% |
Net interest margin (3) |
3.33% |
|
3.40% |
|
3.69% |
|
3.83% |
|
3.90% |
|
|
|
|
|
|
|
|
|
|
Average
Balances: |
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
Loans and leases, net of deferred fees |
$ |
19,670,671 |
|
$ |
19,057,420 |
|
$ |
18,927,314 |
|
$ |
18,769,214 |
|
$ |
19,195,737 |
Investment securities |
8,047,098 |
|
6,492,721 |
|
5,383,140 |
|
4,888,993 |
|
4,107,915 |
Deposits in financial institutions |
5,657,768 |
|
6,347,764 |
|
4,790,231 |
|
3,576,335 |
|
2,554,349 |
Interest-earning assets |
33,375,537 |
|
31,897,905 |
|
29,100,685 |
|
27,234,542 |
|
25,858,001 |
Total assets |
35,871,664 |
|
34,326,112 |
|
31,415,882 |
|
29,334,789 |
|
27,935,193 |
Liabilities: |
|
|
|
|
|
|
|
|
|
Noninterest-bearing deposits |
12,198,313 |
|
11,304,757 |
|
10,173,459 |
|
9,589,789 |
|
8,812,391 |
Interest-bearing deposits |
18,130,694 |
|
17,817,053 |
|
16,044,091 |
|
15,045,451 |
|
14,516,923 |
Total deposits |
30,329,007 |
|
29,121,810 |
|
26,217,550 |
|
24,635,240 |
|
23,329,314 |
Borrowings |
238,335 |
|
225,446 |
|
226,053 |
|
237,098 |
|
181,315 |
Subordinated debt |
862,272 |
|
735,725 |
|
466,101 |
|
463,951 |
|
462,375 |
Interest-bearing liabilities |
19,231,301 |
|
18,778,224 |
|
17,136,245 |
|
15,746,500 |
|
15,160,613 |
Stockholders' equity |
3,916,621 |
|
3,739,042 |
|
3,617,248 |
|
3,536,425 |
|
3,497,869 |
|
|
|
|
|
|
|
|
|
|
(1) Annualized. |
|
|
|
|
|
|
|
|
|
(2) Non-GAAP measure. |
|
|
|
|
|
|
|
|
|
(3) Tax equivalent. |
|
|
|
|
|
|
|
|
|
PACWEST BANCORP AND
SUBSIDIARIES |
|
|
|
|
|
|
|
|
|
FIVE
QUARTER SELECTED FINANCIAL DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At or For the Three Months Ended |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
2021 |
|
2021 |
|
2021 |
|
2020 |
|
2020 |
|
(Dollars in thousands) |
Credit Quality
Ratios: |
|
|
|
|
|
|
|
|
|
Nonaccrual loans and leases held for |
|
|
|
|
|
|
|
|
|
investment to loans and leases |
|
|
|
|
|
|
|
|
|
held for investment |
0.31% |
|
0.29% |
|
0.36% |
|
0.48% |
|
0.45% |
Nonperforming assets to loans and |
|
|
|
|
|
|
|
|
|
leases held for investment and |
|
|
|
|
|
|
|
|
|
foreclosed assets |
0.38% |
|
0.36% |
|
0.43% |
|
0.55% |
|
0.52% |
Classified loans and leases held for |
|
|
|
|
|
|
|
|
|
investment to loans and leases |
|
|
|
|
|
|
|
|
|
held for investment |
0.69% |
|
0.75% |
|
0.86% |
|
1.39% |
|
1.44% |
Provision for credit losses (for the |
|
|
|
|
|
|
|
|
|
quarter) to average loans and leases |
|
|
|
|
|
|
|
|
|
held for investment (annualized) |
(0.40)% |
|
(1.85)% |
|
(1.03)% |
|
0.21% |
|
2.01% |
Net charge-offs (for the quarter) to |
|
|
|
|
|
|
|
|
|
average loans and leases held |
|
|
|
|
|
|
|
|
|
for investment (annualized) |
0.01% |
|
(0.11)% |
|
0.06% |
|
0.40% |
|
0.75% |
Trailing 12 months net charge-offs |
|
|
|
|
|
|
|
|
|
to average loans and leases |
|
|
|
|
|
|
|
|
|
held for investment |
0.09% |
|
0.27% |
|
0.37% |
|
0.45% |
|
0.36% |
Allowance for loan and lease losses to |
|
|
|
|
|
|
|
|
|
loans and leases held for investment |
0.99% |
|
1.16% |
|
1.54% |
|
1.82% |
|
1.82% |
Allowance for credit losses to loans |
|
|
|
|
|
|
|
|
|
and leases held for investment |
1.36% |
|
1.54% |
|
2.02% |
|
2.27% |
|
2.33% |
Allowance for credit losses to |
|
|
|
|
|
|
|
|
|
nonaccrual loans and leases |
|
|
|
|
|
|
|
|
|
held for investment |
433.8% |
|
528.4% |
|
566.2% |
|
475.8% |
|
516.9% |
|
|
|
|
|
|
|
|
|
|
PacWest Bancorp
Consolidated: |
|
|
|
|
|
|
|
|
|
Tier 1 leverage capital ratio (1) |
8.05% |
|
7.67% |
|
7.95% |
|
8.55% |
|
8.66% |
Common equity tier 1 capital ratio (1) |
10.15% |
|
10.41% |
|
10.39% |
|
10.53% |
|
10.45% |
Tier 1 capital ratio (1) |
10.65% |
|
10.41% |
|
10.39% |
|
10.53% |
|
10.45% |
Total capital ratio (1) |
14.36% |
|
14.99% |
|
13.60% |
|
13.76% |
|
13.74% |
Risk-weighted assets (1) |
$ |
26,057,583 |
|
$ |
24,274,256 |
|
$ |
23,012,350 |
|
$ |
22,837,693 |
|
$ |
22,114,040 |
|
|
|
|
|
|
|
|
|
|
Equity to assets ratio |
10.92% |
|
11.03% |
|
11.12% |
|
12.19% |
|
12.26% |
Tangible common equity ratio (2) |
7.79% |
|
7.80% |
|
7.68% |
|
8.78% |
|
8.71% |
Book value per share |
$ |
32.77 |
|
$ |
32.17 |
|
$ |
30.68 |
|
$ |
30.36 |
|
$ |
29.42 |
Tangible book value per share (2) |
$ |
22.57 |
|
$ |
21.95 |
|
$ |
20.39 |
|
$ |
21.05 |
|
$ |
20.09 |
|
|
|
|
|
|
|
|
|
|
Pacific Western
Bank: |
|
|
|
|
|
|
|
|
|
Tier 1 leverage capital ratio (1) |
8.40% |
|
8.47% |
|
8.83% |
|
9.53% |
|
9.70% |
Common equity tier 1 capital ratio (1) |
11.12% |
|
11.51% |
|
11.54% |
|
11.73% |
|
11.70% |
Tier 1 capital ratio (1) |
11.12% |
|
11.51% |
|
11.54% |
|
11.73% |
|
11.70% |
Total capital ratio (1) |
13.59% |
|
14.22% |
|
12.80% |
|
12.99% |
|
12.95% |
|
|
|
|
|
|
|
|
|
|
(1) Capital
information for September 30, 2021 is preliminary. |
|
|
|
|
|
|
|
|
(2) Non-GAAP measure. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP TO NON-GAAP
RECONCILIATIONS
This press release contains certain non-GAAP
financial disclosures for: (1) Pre-provision, pre-goodwill
impairment, pre-tax net revenue (“PPNR”), (2) PPNR return on
average assets (3) return on average tangible equity, (4) tangible
common equity ratio, and (5) tangible book value per share. The
Company uses these 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. In particular, the use
of return on average tangible equity, tangible common equity ratio,
tangible book value per share, and PPNR is prevalent among banking
regulators, investors, and analysts. Accordingly, we disclose the
non-GAAP measures in addition to the related GAAP measures of: (1)
net earnings, (2) return on average assets, (3) return on average
equity, (4) equity to assets ratio, and (5) book value per
share.
The tables below present the reconciliations of
these GAAP financial measures to the related non-GAAP financial
measures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
PPNR and PPNR
Return |
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
on Average
Assets |
2021 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(Dollars in thousands) |
Net earnings (loss) |
$ |
139,996 |
|
$ |
180,512 |
|
$ |
45,503 |
|
$ |
470,914 |
|
$ |
(1,354,404) |
Add: Provision for credit
losses |
(20,000) |
|
(88,000) |
|
97,000 |
|
(156,000) |
|
329,000 |
Add: Goodwill impairment |
- |
|
- |
|
- |
|
- |
|
1,470,000 |
Add: Income tax expense |
47,770 |
|
62,417 |
|
13,671 |
|
163,743 |
|
38,627 |
Pre-provision, pre-goodwill impairment, |
|
|
|
|
|
|
|
|
|
pre-tax net revenue ("PPNR") |
$ |
167,766 |
|
$ |
154,929 |
|
$ |
156,174 |
|
$ |
478,657 |
|
$ |
483,223 |
|
|
|
|
|
|
|
|
|
|
Average assets |
$ |
35,871,664 |
|
$ |
34,326,112 |
|
$ |
27,935,193 |
|
$ |
33,887,541 |
|
$ |
27,221,102 |
|
|
|
|
|
|
|
|
|
|
Return on average assets
(1) |
1.55% |
|
2.11% |
|
0.65% |
|
1.86% |
|
(6.65)% |
PPNR return on average assets
(2) |
1.86% |
|
1.81% |
|
2.22% |
|
1.89% |
|
2.37% |
|
|
|
|
|
|
|
|
|
|
(1) Annualized net
earnings (loss) divided by average assets. |
|
|
|
|
|
|
(2) Annualized
PPNR divided by average assets. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
Return on Average
Tangible Equity |
2021 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
(Dollars in thousands) |
Net earnings (loss) |
$ |
139,996 |
|
$ |
180,512 |
|
$ |
45,503 |
|
$ |
470,914 |
|
$ |
(1,354,404) |
Add: Intangible asset
amortization |
2,890 |
|
2,889 |
|
3,751 |
|
8,858 |
|
11,581 |
Add: Goodwill impairment |
- |
|
- |
|
- |
|
- |
|
1,470,000 |
Adjusted net earnings |
$ |
142,886 |
|
$ |
183,401 |
|
$ |
49,254 |
|
$ |
479,772 |
|
$ |
127,177 |
|
|
|
|
|
|
|
|
|
|
Average stockholders'
equity |
$ |
3,916,621 |
|
$ |
3,739,042 |
|
$ |
3,497,869 |
|
$ |
3,758,733 |
|
$ |
3,965,453 |
Less: Average intangible
assets |
1,221,253 |
|
1,224,208 |
|
1,107,548 |
|
1,212,851 |
|
1,594,231 |
Average tangible common equity |
$ |
2,695,368 |
|
$ |
2,514,834 |
|
$ |
2,390,321 |
|
$ |
2,545,882 |
|
$ |
2,371,222 |
|
|
|
|
|
|
|
|
|
|
Return on average equity
(1) |
14.18% |
|
19.36% |
|
5.18% |
|
16.75% |
|
(45.62)% |
Return on average tangible
equity (2) |
21.03% |
|
29.25% |
|
8.20% |
|
25.20% |
|
7.16% |
|
|
|
|
|
|
|
|
|
|
(1) Annualized net
earnings divided by average stockholders' equity. |
|
|
|
|
|
|
(2) Annualized
adjusted net earnings divided by average tangible common
equity. |
|
CONTACTS
Matthew P. Wagner President and CEO
303.802.8900 |
Bart R. Olson EVP and CFO 714.989.4149 |
William J. Black EVP Strategy and Corporate
Development 919.597.7466 |
PacWest Bancorp (NASDAQ:PACW)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
PacWest Bancorp (NASDAQ:PACW)
Historical Stock Chart
Von Jul 2023 bis Jul 2024