California BanCorp (“us,” “we,” “our,” or the “Company”) (NASDAQ:
BCAL), the holding company for California Bank of Commerce, N.A.
(the “Bank”) announces its consolidated financial results for the
third quarter of 2024.
The Company reported net loss of $16.5 million
for the third quarter of 2024, or $0.59 diluted loss per share,
compared to net income of $190 thousand, or $0.01 per diluted share
in the second quarter of 2024, and $6.6 million, or $0.35 per
diluted share in the third quarter of 2023.
“As we previously reported, the merger of
Southern California Bancorp and California BanCorp closed on July
31, 2024, and I am pleased to announce we executed a successful
core conversion on September 20, 2024,” said David Rainer,
Executive Chairman of the Company and the Bank. “We are excited to
have created a commercial banking franchise with a footprint that
covers the best banking markets in both Northern and Southern
California and that is based on our trusted brands and reputations.
Our scalable business model is expected to bring cost savings and
greater efficiency to our operations, while allowing us to offer
complementary products and services to all our clients. We will
continue to build on our history of service to our communities and
remain dedicated to increasing shareholder value.”
“With the close of the merger and successful
conversion behind us, we are now focused on the prudent growth of
our franchise by offering the highest quality and level of customer
service available to middle-market businesses in both Northern and
Southern California,” said Steven Shelton, CEO of the Company and
the Bank. “We are excited about our future and look forward to the
traction we expect our combined banking franchise will realize in
the coming quarters.”
Third Quarter 2024 Highlights
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Merger closed on July 31, 2024, whereby California
BanCorp (“CALB”) merged with and into Southern California Bancorp
and California Bank of Commerce merged with and into Bank of
Southern California, N.A. CALB had total loans of $1.43 billion,
total assets of $1.91 billion, and total deposits of $1.64 billion.
The combined holding company has assumed the California BanCorp
name, and the combined bank has assumed the California Bank of
Commerce, N.A. name. The merger created a bank holding company with
approximately $4.25 billion in assets and 14 branches across
California, with approximately 300 employees serving our
communities. |
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Total aggregate consideration paid was
approximately $216.6 million and resulted in approximately $74.7
million of preliminary goodwill subject to adjustment in accordance
with ASC 805. |
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Net loss of $16.5 million or $0.59 diluted loss
per share for the third quarter reflects the after-tax one-time
initial provision for credit losses (“day one provision”) related
to non-purchased credit deteriorated (“non-PCD”) loans and unfunded
loan commitments of $15.0 million and merger related expenses of
$10.6 million; adjusted net income (non-GAAP1) was $9.1 million or
$0.33 per share for the third quarter. |
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Net interest margin of 4.43%, compared with 3.94%
in the prior quarter; average total loan yield of 6.79% compared
with 6.21% in the prior quarter. |
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Provision for credit losses of $23.0 million for
the third quarter, of which $21.3 million was due to the day one
provision for credit losses on non-PCD loans and unfunded loan
commitments. |
1 Reconciliations of non–U.S. generally accepted
accounting principles (“GAAP”) measures are set forth at the end of
this press release.
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Return on average assets of (1.82)%, compared with
0.03% in the prior quarter. |
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Return on average common equity of (15.28)%,
compared with 0.26% in the prior quarter. |
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Efficiency ratio
(non-GAAP1) of 98.9%
compared with 85.7% in the prior quarter; excluding merger related
expenses the efficiency ratio was 60.5%, compared with 83.5% in the
prior quarter. |
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Tangible book value per common share (“TBV”)
(non-GAAP1) of $11.28 at
September 30, 2024, down $2.43 from $13.71 at June 30, 2024. |
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Total assets of $4.36 billion at September 30,
2024, compared with $2.29 billion at June 30, 2024. |
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Total loans, including loans held for sale of
$3.23 billion at September 30, 2024, compared with $1.88 billion at
June 30, 2024, largely due to the merger, with the fair value of
the acquired loans totaling $1.36 billion. |
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Nonperforming assets to total assets ratio of
0.68% at September 30, 2024, compared with 0.20% at June 30, 2024,
which included the fair value of $13.9 million in nonaccrual PCD
loans in connection with the merger. |
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Allowance for credit losses (“ACL”) was 1.80% of
total loans held for investment at September 30, 2024; allowance
for loan losses (“ALL”) was 1.67% of total loans held for
investment at September 30, 2024. |
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Total deposits of $3.74 billion at September 30,
2024, increased $1.81 billion or 93.2% compared with $1.94 billion
at June 30, 2024, largely due to the $1.64 billion of deposits
acquired in the merger. |
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Noninterest-bearing demand deposits of $1.37
billion at September 30, 2024, an increase of $701.7 million or
105.3%, of which $635.5 million was related to the merger;
noninterest bearing deposits represented 36.6% of total deposits,
compared with $666.6 million, or 34.4% of total deposits at June
30, 2024. |
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Cost of deposits was 2.09%, compared with 2.12% in
the prior quarter. |
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Cost of funds was 2.19%, compared with 2.21% in
the prior quarter. |
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The Company’s capital exceeds minimums required to be
“well-capitalized,” the highest
regulatory capital category. |
Third Quarter Operating Results
Net Loss
Net loss for the third quarter of 2024 was $16.5
million, or $0.59 loss per diluted share, compared with net income
of $190 thousand, or $0.01 per diluted share in the second quarter
of 2024. Our third quarter results were negatively impacted by a
day one $15.0 million after-tax CECL-related provision for credit
losses on non-PCD loans and unfunded loan commitments related to
the merger, or $0.54 loss per diluted share, and $10.6 million of
after-tax merger expenses, or $0.38 loss per diluted share.
Excluding one-time CECL-related provision for credit losses on
acquired loans and unfunded loan commitments, and merger related
expenses, the Company would have reported net income (non-GAAP1) of
$9.1 million, or $0.33 per diluted share, for the third quarter of
2024. Pre-tax, pre-provision income (non-GAAP1) for the third
quarter was $436 thousand, a decrease of $2.7 million or 86.3% from
the prior quarter.
Net Interest Income and Net Interest
Margin
Net interest income for the third quarter of
2024 was $36.9 million, compared with $21.0 million in the prior
quarter. The increase in net interest income was primarily due to a
$22.3 million increase in total interest and dividend income,
partially offset by a $6.3 million increase in total interest
expense in the third quarter of 2024, as compared to the prior
quarter. During the third quarter of 2024, loan interest income
increased $18.5 million, of which $4.1 million was related to
accretion income from the net purchase accounting discounts on
acquired loans, total debt securities income increased $458
thousand, and interest and dividend income from other financial
institutions increased $3.3 million. The increase in interest
income was primarily driven by the mix of interest-earning assets
added by the merger and the impact of the accretion and
amortization of fair value marks. Average total interest-earning
assets increased $1.17 billion, the result of a $900.7 million
increase in average total loans, a $114.2 million increase in
average deposits in other financial institutions, a $25.1 million
increase in average total debt securities, a $124.1 million
increase in average Fed funds sold/resale agreements and a $7.5
million increase in average restricted stock investments and other
bank stock. The increase in interest expense for the third quarter
of 2024 was primarily due to a $6.0 million increase in interest
expense on interest-bearing deposits, the result of a $763.7
million increase in average interest-bearing deposits, coupled with
a $34.3 million increase in average subordinated debt, partially
offset by a 6 basis point decrease in average interest-bearing
deposit costs, and a $378 thousand decrease in interest expense on
Federal Home Loan Bank (“FHLB”) borrowings, the result of a $26.8
million decrease in average FHLB borrowings in the third quarter of
2024.
Net interest margin for the third quarter of
2024 was 4.43%, compared with 3.94% in the prior quarter. The
increase was primarily related to a 52 basis point increase in the
total interest-earning assets yield, coupled with a 2 basis point
decrease in the cost of funds. The yield on total average earning
assets in the third quarter of 2024 was 6.49%, compared with 5.97%
in the prior quarter. The yield on average total loans in the third
quarter of 2024 was 6.79%, an increase of 58 basis points from
6.21% in the prior quarter. Accretion income from the net purchase
accounting discounts on acquired loans was $4.1 million and the
amortization expense impact on interest expense was $283 thousand,
which increased the net interest margin by 46 basis points in the
third quarter of 2024. Accretion income from the net purchase
accounting discounts on acquired loans was $4.1 million, which
increased the yield on average total loans by 59 basis points in
the third quarter of 2024.
Cost of funds for the third quarter of 2024 was
2.19%, a decrease of 2 basis points from 2.21% in the prior
quarter. The decrease was primarily driven by a 6 basis point
decrease in the cost of average interest-bearing deposits, and an
increase in average noninterest-bearing deposits, partially offset
by an increase of 187 basis points in the cost of total borrowings,
which was driven primarily by the amortization expense of $373
thousand, or 281 basis points from the purchase accounting
discounts on acquired subordinated debts. Average
noninterest-bearing demand deposits increased $373.8 million to
$1.03 billion and represented 33.6% of total average deposits for
the third quarter of 2024, compared with $658.0 million and 34.1%,
respectively, in the prior quarter; average interest-bearing
deposits increased $763.7 million to $2.04 billion during the third
quarter of 2024. The total cost of deposits in the third quarter of
2024 was 2.09%, a decrease of 3 basis points from 2.12% in the
prior quarter. The cost of total interest-bearing deposits
decreased primarily due to the Company’s deposit repricing strategy
and paying off high cost brokered deposits in the third quarter of
2024.
Average total borrowings increased $7.6 million
to $52.9 million for the third quarter of 2024, primarily due to an
increase of $34.3 million in average subordinated debt from the
$50.8 million in fair value of subordinated debt acquired in the
merger, partially offset by a decrease of $26.8 million in average
FHLB borrowings during the third quarter of 2024. The average cost
of total borrowings was 7.71% for the third quarter of 2024, up
from 5.84% in the prior quarter.
Provision for Credit Losses
The Company recorded a provision for credit
losses of $23.0 million in the third quarter of 2024, compared to
$2.9 million in the prior quarter. The increase was largely related
to the merger, and the resulting one-time initial provision for
credit losses on acquired non-PCD loans of $18.5 million and
unfunded commitments of $2.7 million. Total net charge-offs were
$1.2 million in the third quarter of 2024, which included $967
thousand from a construction loan and $135 thousand from an
acquired consumer solar loan portfolio. The provision for credit
losses in the third quarter of 2024 included a $3.3 million
provision for unfunded loan commitments, of which $2.7 million was
related to the one-time initial provision for credit losses on
acquired unfunded loan commitments, and $511 thousand related to
the increase in unfunded loan commitments during the third quarter
of 2024, coupled with higher loss rates and average funding rates
used to estimate the allowance for credit losses on unfunded
commitments. Total unfunded loan commitments increased $662.4
million to $1.03 billion at September 30, 2024, including $574.3
million in unfunded loan commitment related to the merger, compared
to $371.5 million in unfunded loan commitments at June 30, 2024.
The provision for credit losses for loans held for investment in
the third quarter of 2024 was $19.7 million, an increase of $16.7
million from $3.0 million in the prior quarter. The increase was
driven primarily by the one-time initial provision for credit
losses on acquired non-PCD loans and increases in legacy special
mention loans and loans held for investment. Additionally,
qualitative factors, coupled with changes in the portfolio mix and
in net charge-offs, and in the reasonable and supportable forecast,
primarily related to the economic outlook for California which were
partially offset by decreases in legacy substandard accruing loans,
were factors related to the increase in the provision for credit
losses. The Company’s management continues to monitor macroeconomic
variables related to increasing interest rates, inflation and the
concerns of an economic downturn, and believes it has appropriately
provisioned for the current environment.
Noninterest Income
The Company recorded noninterest income of $1.2
million in the third quarter of 2024, a decrease of $5 thousand
compared to $1.2 million in the second quarter of 2024. There was
no gain on SBA 7A loan sales in the second and third quarters of
2024. Noninterest income was impacted by the merger through
increases in service charges and fees on deposit accounts, bank
owned life insurance income, and servicing and related income on
loans; offset by a $614 thousand valuation allowance on other real
estate owned (“OREO”) due to a decline in the fair value of the
underlying property in the third quarter of 2024.
Noninterest Expense
Total noninterest expense for the third quarter
of 2024 was $37.7 million, an increase of $18.7 million from total
noninterest expense of $19.0 million in the prior quarter, which
was largely due to the increase in merger related expenses.
Salaries and employee benefits increased $6.6
million during the quarter to $15.4 million. The increase in
salaries and employee benefits was primarily the result of the
merger and included $1.4 million related to one-time costs
associated with non-continuing directors, executives and employees.
Merger and related expenses in connection with the merger increased
$14.1 million to $14.6 million. These costs primarily included
retention bonus, severance and change in control costs of $6.2
million, financial advisory fees of $2.3 million, information
technology expenses of $4.5 million, insurance costs of $919
thousand and legal and other professional costs of $305 thousand.
The increase in core deposit intangible amortization was primarily
driven by $622 thousand related to the additional amortization from
the core deposit intangible of $22.7 million acquired in the
merger.
The Company sold other real estate owned and
recognized a $4.8 million loss in the second quarter of 2024. There
was no comparable transaction in the third quarter of 2024.
Efficiency ratio (non-GAAP1) for the third
quarter of 2024 was 98.9%, compared to 85.7% in the prior quarter.
Excluding the merger and related expenses of $14.6 million, the
efficiency ratio (non-GAAP1) for the third quarter of 2024 would
have been 60.5%.
Income Tax
In the third quarter of 2024, the Company’s
income tax benefit was $6.1 million, compared with an $88 thousand
income tax expense in the second quarter of 2024. The effective
rate was 26.9% for the third quarter of 2024 and 31.7% for the
second quarter of 2024. The decrease in the effective tax rate for
the third quarter of 2024 was primarily attributable to the impact
of the vesting and exercise of equity awards combined with changes
in the Company’s stock price over time, as well as non-deductible
merger-related expenses.
Balance Sheet
Assets
Total assets at September 30, 2024 were $4.36
billion, an increase of $2.07 billion or 90.2% from June 30, 2024.
The increase in total assets from the prior quarter was primarily
related to the $1.86 billion in fair value of total assets acquired
in the merger, which included increases of $1.36 billion in loans
held for investment, $42.6 million in debt securities, and $336.3
million in cash and cash equivalents. In addition, the Company
recorded preliminary goodwill of $74.7 million related to the
merger in the third quarter of 2024.
Loans
Total loans held for investment were $3.20
billion at September 30, 2024, an increase of $1.32 billion,
compared to June 30, 2024, primarily the result of the $1.36
billion fair value of loans acquired in the merger. During the
third quarter 2024, there were new originations of $70.0 million
and net advances of $8.9 million, offset by payoffs of $64.9
million, and the transfer of a multifamily nonaccrual loan of $4.7
million to OREO and the partial charge-off of loans in the amount
of $1.2 million. Total loans secured by real estate increased by
$814.5 million, including $780.9 million acquired in the merger,
construction and land development loans increased by $42.9 million,
commercial real estate and other loans increased by $712.2 million,
1-4 family residential loans decreased by $4.8 million and
multifamily loans increased by $64.2 million. Commercial and
industrial loans increased by $482.3 million, and consumer loans
increased by $25.3 million, largely due to a $25.2 million increase
in consumer loans related to the merger. The Company had $33.7
million in loans held for sale at September 30, 2024, compared to
$7.0 million at June 30, 2024.
Deposits
Total deposits at September 30, 2024 were $3.74
billion, an increase of $1.81 billion from June 30, 2024 due to the
$1.64 billion in fair value of deposits related to the merger.
Noninterest-bearing demand deposits at September 30, 2024, were
$1.37 billion, including $635.5 million noninterest-bearing demand
deposits related to the merger, or 36.6% of total deposits,
compared with $666.6 million, or 34.4% of total deposits at June
30, 2024. At September 30, 2024, total interest-bearing deposits
were $2.37 billion, compared to $1.27 billion at June 30, 2024. At
September 30, 2024, total brokered time deposits were $222.6
million, including a $251.4 million increase of brokered time
deposits related to the merger, compared to $103.4 million in
brokered time deposits at June 30, 2024. The Company used excess
cash acquired from the merger to pay off high cost callable and
noncallable brokered time deposits totaling $131.9 million during
the third quarter 2024. The Company also offers the Insured Cash
Sweep (ICS) product, providing customers with FDIC insurance
coverage at ICS network institutions. At September 30, 2024, ICS
deposits were $699.6 million, or 18.7% of total deposits, compared
to $239.8 million, or 12.4% of total deposits at June 30, 2024.
Legacy CALB was also a participant in the Certificate of Deposit
Account Registry Service (CDARS), and Reich & Tang Deposit
Solutions (R&T) network, both of which provide reciprocal
deposit placement services to fully qualified large customer
deposits for FDIC insurance among other participating banks. At
July 31, 2024, the Company acquired the fair value of $37.7 million
in CDARS deposits and $306.6 million in R&T deposits.
Federal Home Loan Bank (“FHLB”) and
Liquidity
The Company repaid all FHLB borrowings with
liquidity primarily derived from the cash acquired in the merger
during the third quarter of 2024. At September 30, 2024, the
Company had no overnight FHLB borrowings, a $25.0 million decrease
from June 30, 2024. There were no outstanding Federal Reserve
Discount Window borrowings at September 30, 2024 or June 30,
2024.
At September 30, 2024, the Company had available
borrowing capacity from the FHLB secured line of credit of
approximately $663.6 million and available borrowing capacity from
the Federal Reserve Discount Window of approximately $446.4
million. The Company also had available borrowing capacity from
eight unsecured credit lines from correspondent banks of
approximately $121.0 million at September 30, 2024, with no
outstanding borrowings. Total available borrowing capacity was
$1.23 billion at September 30, 2024. Additionally, the Company had
unpledged liquid securities at fair value of approximately $159.3
million and cash and cash equivalents of $614.4 million at
September 30, 2024.
In connection with the merger, the Company
assumed subordinated borrowings of $55.0 million, with a fair value
of $50.8 million. The subordinated borrowings include $20.0 million
with a maturity date in September 2030 and $35.0 million with a
maturity date in September 2031.
Asset Quality
Total non-performing assets increased to $29.8
million, or 0.68% of total assets at September 30, 2024, compared
with $4.7 million, or 0.20% of total assets at June 30, 2024.
The increase in non-performing assets in the
third quarter of 2024 was primarily attributable to downgrades of a
construction loan and 1-4 family residential loan from one
relationship totaling $12.7 million and a $13.9 million of
nonaccrual PCD loans acquired in the merger. This increase was net
of total charge-offs of $1.2 million, which included a partial
charge-off of $967 thousand for a substandard nonaccrual
construction loan collateralized by a stalled construction project
in Los Angeles, California. Based on the Company’s internal
analysis, which included a review of an updated appraisal, the
estimated net collateral value was $9.7 million, which was $967
thousand lower than the subject loan’s net carrying value resulting
in a partial charge-off in the third quarter of 2024. The Company
expects to pursue the resolution of this matter. Non-performing
assets in the third quarter of 2024 included OREO, net of valuation
allowance, of $4.1 million related to a multifamily nonaccrual loan
of $4.7 million that was transferred to OREO and the Company
recorded a $614 thousand valuation allowance on OREO due to a
decline in the fair value of the underlying property in the third
quarter of 2024.
Total non-performing loans increased to $25.7
million, or 0.80% of total loans held for investment at September
30, 2024, compared with $4.7 million, or 0.25% of total loans at
June 30, 2024. The increase from June 30, 2024 was due primarily to
the aforementioned downgrades of a construction loan and 1-4 family
residential loan from one relationship, nonaccrual PCD loans
acquired in the merger and partial charge-offs of loans in the
amount of $1.2 million in the third quarter of 2024.
Special mention loans increased by $65.6
million, including $41.0 million non-PCD loans and $10.1 million
PCD loans, during the third quarter of 2024 to $93.4 million at
September 30, 2024. The $14.5 million increase in the legacy
special mention loans was due mostly to a $2.2 million increase in
special mention commercial real estate loans and a $12.3 million
increase in special mention commercial and industrial loans.
Substandard loans increased by $81.2 million, including $2.3
million non-PCD loans, $71.3 million PCD loans, and $13.5 million
nonaccrual PCD loans, during the third quarter of 2024 to $104.3
million at September 30, 2024. The $5.8 million decrease in the
legacy substandard loans was due primarily to the transfer of a
multifamily nonaccrual loan of $4.7 million to OREO and the partial
charge-off of $967 thousand for the nonaccrual construction loan,
partially offset by a downgrade to substandard of a commercial and
industrial loan of $118 thousand during the third quarter of
2024.
The Company had $37 thousand in consumer solar
loans that were over 90 days past due that were accruing interest
at September 30, 2024, and no delinquencies at June 30, 2024.
There were $19.1 million in loan delinquencies
(30-89 days past due, excluding nonaccrual loans) at September 30,
2024 and no delinquencies at June 30, 2024.
The allowance for credit losses, which is
comprised of the allowance for loan losses (“ALL”) and reserve for
unfunded loan commitments, totaled $57.6 million at September 30,
2024, compared to $24.6 million at June 30, 2024. The $33.0 million
increase in the allowance included a $19.7 million provision for
credit losses for the loan portfolio, of which $11.2 million
related to the initial allowance for credit losses on acquired PCD
loans, $21.3 million related to the initial provision for credit
losses on acquired non-PCD loans and unfunded loan commitments,
partially offset by total charge-offs of $1.2 million for the
quarter ended September 30, 2024.
The ALL was $53.6 million, or 1.67% of total
loans held for investment at September 30, 2024, compared with
$23.8 million, or 1.27% at June 30, 2024.
Capital
Tangible book value (non-GAAP1) per common share
at September 30, 2024, was $11.28, compared with $13.71 at June 30,
2024. In the third quarter of 2024, tangible book value was
primarily impacted by the net loss for the third quarter, the
impact of equity issued in connection with the merger, stock-based
compensation expense, and a decrease in net of unrealized tax
losses on available-for-sale debt securities. Other comprehensive
losses related to unrealized losses, net of taxes, on
available-for-sale debt securities decreased by $3.6 million to
$2.9 million at September 30, 2024, from $6.5 million at June 30,
2024. The decrease in the unrealized losses, net of taxes, on
available-for-sale debt securities was primarily attributable to
factors other than credit related, including decreases in market
interest rates driven by the Federal Reserve’s 50 basis point rate
cut in September 2024. Tangible common equity (non-GAAP1) as a
percentage of total tangible assets (non-GAAP1) at September 30,
2024, decreased to 8.58% from 11.28% in the prior quarter, and
unrealized losses, net of taxes, on available-for-sale debt
securities as a percentage of tangible common equity (non-GAAP1) at
September 30, 2024 decreased to 0.8% from 2.6% in the prior
quarter.
The Company’s preliminary capital exceeds
minimums required to be “well-capitalized” at September 30,
2024.
ABOUT CALIFORNIA BANCORP
California BanCorp (NASDAQ: BCAL) is a
registered bank holding company headquartered in San Diego,
California. California Bank of Commerce, N.A., a national banking
association chartered under the laws of the United States (the
“Bank”) and regulated by the Office of Comptroller of the Currency,
is a wholly owned subsidiary of California BanCorp. Established in
2001 and headquartered in San Diego, California, the Bank offers a
range of financial products and services to individuals,
professionals, and small to medium-sized businesses through its 14
branch offices and four loan production offices serving Northern
and Southern California. The Bank’s solutions-driven,
relationship-based approach to banking provides accessibility to
decision makers and enhances value through strong partnerships with
its clients. Additional information is available at
www.bankcbc.com.
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS
In addition to historical information, this
release includes forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995.
Forward-looking statements relate to expectations, beliefs,
projections, future plans and strategies, anticipated events or
trends and other matters that are not historical facts. Examples of
forward-looking statements include, among others, statements
regarding expectations, plans or objectives for future operations,
products or services, loan recoveries, projections, expectations
regarding the adequacy of reserves for credit losses and statements
about the benefits of the Company’s merger with CALB (the
“Merger”), as well as forecasts relating to financial and operating
results or other measures of economic performance. Forward-looking
statements reflect management’s current view about future events
and involve risks and uncertainties that may cause actual results
to differ from those expressed in the forward-looking statement or
historical results. Forward-looking statements can be identified by
the fact that they do not relate strictly to historical or current
facts and often include the words or phrases such as “aim,” “can,”
“may,” “could,” “predict,” “should,” “will,” “would,” “believe,”
“anticipate,” “estimate,” “expect,” “hope,” “intend,” “plan,”
“potential,” “project,” “will likely result,” “continue,” “seek,”
“shall,” “possible,” “projection,” “optimistic,” and “outlook,” and
variations of these words and similar expressions.
Factors that could cause or contribute to
results differing from those in or implied in the forward-looking
statements include but are not limited to risk related to the
Merger, including the risks that costs may be greater than
anticipated, cost savings may be less than anticipated, and
difficulties in retaining senior management, employees or
customers, the impact of bank failures or other adverse
developments at other banks on general investor sentiment regarding
the stability and liquidity of banks, changes in real estate
markets and valuations; the impact on financial markets from
geopolitical conflicts; inflation, interest rate, market and
monetary fluctuations and general economic conditions, either
nationally or locally in the areas in which the Company conducts
business; increases in competitive pressures among financial
institutions and businesses offering similar products and services;
general credit risks related to lending, including changes in the
value of real estate or other collateral, the financial condition
of borrowers, the effectiveness of our underwriting practices and
the risk of fraud; higher than anticipated defaults in the
Company’s loan portfolio; changes in management’s estimate of the
adequacy of the allowance for credit losses or the factors the
Company uses to determine the allowance for credit losses; changes
in demand for loans and other products and services offered by the
Company; the costs and outcomes of litigation; legislative or
regulatory changes or changes in accounting principles, policies or
guidelines and other risk factors discussed in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2023, filed
with the Securities and Exchange Commission (“SEC”) and other
documents the Company may file with the SEC from time to time.
Additional information regarding these and other
risks and uncertainties to which our business and future financial
performance are subject is contained in the Company’s Annual Report
on Form 10-K for the year ended December 31, 2023, and other
documents the Company files with the SEC from time to time.
Any forward-looking statement made in this
release is based only on information currently available to
management and speaks only as of the date on which it is made. The
Company does not undertake, and specifically disclaims any
obligation, to update any forward-looking statements to reflect
occurrences or unanticipated events or circumstances after the date
of such statements or to conform such forward-looking statements to
actual results or to changes in its opinions or expectations,
except as required by law.
California BanCorp and
SubsidiaryFinancial Highlights (Unaudited)
| |
|
At or for the Three Months
Ended |
|
|
At or for the Nine Months
Ended |
|
| |
|
September 30,2024 |
|
|
June 30,2024 |
|
|
September 30,2023 |
|
|
September 30,2024 |
|
|
September 30,2023 |
|
| EARNINGS |
|
($ in thousands except share and per share data) |
|
|
Net interest income |
|
$ |
36,942 |
|
|
$ |
21,007 |
|
|
$ |
23,261 |
|
|
$ |
78,443 |
|
|
$ |
71,579 |
|
|
Provision for (reversal of) credit losses |
|
$ |
22,963 |
|
|
$ |
2,893 |
|
|
$ |
(96 |
) |
|
$ |
25,525 |
|
|
$ |
91 |
|
|
Noninterest income |
|
$ |
1,174 |
|
|
$ |
1,169 |
|
|
$ |
815 |
|
|
$ |
3,756 |
|
|
$ |
3,481 |
|
|
Noninterest expense |
|
$ |
37,680 |
|
|
$ |
19,005 |
|
|
$ |
14,781 |
|
|
$ |
71,666 |
|
|
$ |
44,407 |
|
|
Income tax (benefit) expense |
|
$ |
(6,063 |
) |
|
$ |
88 |
|
|
$ |
2,835 |
|
|
$ |
(3,653 |
) |
|
$ |
9,064 |
|
|
Net (loss) income |
|
$ |
(16,464 |
) |
|
$ |
190 |
|
|
$ |
6,556 |
|
|
$ |
(11,339 |
) |
|
$ |
21,498 |
|
|
Pre-tax pre-provision income (1) |
|
$ |
436 |
|
|
$ |
3,171 |
|
|
$ |
9,295 |
|
|
$ |
10,533 |
|
|
$ |
30,653 |
|
|
Adjusted pre-tax pre-provision income (1) |
|
$ |
15,041 |
|
|
$ |
3,662 |
|
|
$ |
9,295 |
|
|
$ |
26,178 |
|
|
$ |
30,653 |
|
|
Diluted (loss) earnings per share |
|
$ |
(0.59 |
) |
|
$ |
0.01 |
|
|
$ |
0.35 |
|
|
$ |
(0.53 |
) |
|
$ |
1.15 |
|
|
Shares outstanding at period end |
|
|
32,142,427 |
|
|
|
18,547,352 |
|
|
|
18,309,282 |
|
|
|
32,142,427 |
|
|
|
18,309,282 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| PERFORMANCE
RATIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets |
|
|
(1.82 |
)% |
|
|
0.03 |
% |
|
|
1.12 |
% |
|
|
(0.55 |
)% |
|
|
1.25 |
% |
|
Adjusted return on average assets (1) |
|
|
1.01 |
% |
|
|
0.11 |
% |
|
|
1.12 |
% |
|
|
0.74 |
% |
|
|
1.25 |
% |
|
Return on average common equity |
|
|
(15.28 |
)% |
|
|
0.26 |
% |
|
|
9.38 |
% |
|
|
(4.48 |
)% |
|
|
10.63 |
% |
|
Adjusted return on average common equity (1) |
|
|
8.44 |
% |
|
|
0.82 |
% |
|
|
9.38 |
% |
|
|
6.00 |
% |
|
|
10.63 |
% |
|
Yield on total loans |
|
|
6.79 |
% |
|
|
6.21 |
% |
|
|
5.97 |
% |
|
|
6.40 |
% |
|
|
5.89 |
% |
|
Yield on interest earning assets |
|
|
6.49 |
% |
|
|
5.97 |
% |
|
|
5.72 |
% |
|
|
6.15 |
% |
|
|
5.63 |
% |
|
Cost of deposits |
|
|
2.09 |
% |
|
|
2.12 |
% |
|
|
1.56 |
% |
|
|
2.09 |
% |
|
|
1.22 |
% |
|
Cost of funds |
|
|
2.19 |
% |
|
|
2.21 |
% |
|
|
1.62 |
% |
|
|
2.19 |
% |
|
|
1.30 |
% |
|
Net interest margin |
|
|
4.43 |
% |
|
|
3.94 |
% |
|
|
4.23 |
% |
|
|
4.12 |
% |
|
|
4.43 |
% |
|
Efficiency ratio (1) |
|
|
98.86 |
% |
|
|
85.70 |
% |
|
|
61.39 |
% |
|
|
87.19 |
% |
|
|
59.16 |
% |
|
Adjusted efficiency ratio (1) |
|
|
60.54 |
% |
|
|
83.49 |
% |
|
|
61.39 |
% |
|
|
68.15 |
% |
|
|
59.16 |
% |
| |
|
As of |
|
| |
|
September 30,2024 |
|
|
June 30,2024 |
|
|
December 31,2023 |
|
| CAPITAL |
|
($ in thousands except share and per share data) |
|
|
Tangible equity to tangible assets (1) |
|
|
8.58 |
% |
|
|
11.28 |
% |
|
|
10.73 |
% |
|
Book value (BV) per common share |
|
$ |
15.50 |
|
|
$ |
15.81 |
|
|
$ |
15.69 |
|
|
Tangible BV per common share (1) |
|
$ |
11.28 |
|
|
$ |
13.71 |
|
|
$ |
13.56 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| ASSET
QUALITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses (ALL) |
|
$ |
53,552 |
|
|
$ |
23,788 |
|
|
$ |
22,569 |
|
|
Reserve for unfunded loan commitments |
|
$ |
4,071 |
|
|
$ |
819 |
|
|
$ |
933 |
|
|
Allowance for credit losses (ACL) |
|
$ |
57,623 |
|
|
$ |
24,607 |
|
|
$ |
23,502 |
|
|
Allowance for loan losses to nonperforming loans |
|
|
2.09 |
x |
|
|
5.07 |
x |
|
|
1.74 |
x |
|
ALL to total loans held for investment |
|
|
1.67 |
% |
|
|
1.27 |
% |
|
|
1.15 |
% |
|
ACL to total loans held for investment |
|
|
1.80 |
% |
|
|
1.31 |
% |
|
|
1.20 |
% |
|
30-89 days past due, excluding nonaccrual loans |
|
$ |
19,110 |
|
|
$ |
— |
|
|
$ |
19 |
|
|
Over 90 days past due, excluding nonaccrual loans |
|
$ |
37 |
|
|
$ |
— |
|
|
$ |
— |
|
|
Special mention loans |
|
$ |
93,448 |
|
|
$ |
27,861 |
|
|
$ |
2,996 |
|
|
Special mention loans to total loans held for investment |
|
|
2.92 |
% |
|
|
1.48 |
% |
|
|
0.15 |
% |
|
Substandard loans |
|
$ |
104,298 |
|
|
$ |
23,080 |
|
|
$ |
19,502 |
|
|
Substandard loans to total loans held for investment |
|
|
3.26 |
% |
|
|
1.23 |
% |
|
|
1.00 |
% |
|
Nonperforming loans |
|
$ |
25,698 |
|
|
$ |
4,696 |
|
|
$ |
13,004 |
|
|
Nonperforming loans total loans held for investment |
|
|
0.80 |
% |
|
|
0.25 |
% |
|
|
0.66 |
% |
|
Other real estate owned, net |
|
$ |
4,083 |
|
|
$ |
— |
|
|
$ |
— |
|
|
Nonperforming assets |
|
$ |
29,781 |
|
|
$ |
4,696 |
|
|
$ |
13,004 |
|
|
Nonperforming assets to total assets |
|
|
0.68 |
% |
|
|
0.20 |
% |
|
|
0.55 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| END OF PERIOD
BALANCES |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans, including loans held for sale |
|
$ |
3,233,418 |
|
|
$ |
1,884,599 |
|
|
$ |
1,964,791 |
|
|
Total assets |
|
$ |
4,362,767 |
|
|
$ |
2,293,693 |
|
|
$ |
2,360,252 |
|
|
Deposits |
|
$ |
3,740,915 |
|
|
$ |
1,935,862 |
|
|
$ |
1,943,556 |
|
|
Loans to deposits |
|
|
86.4 |
% |
|
|
97.4 |
% |
|
|
101.1 |
% |
|
Shareholders’ equity |
|
$ |
498,064 |
|
|
$ |
293,219 |
|
|
$ |
288,152 |
|
(1) Non-GAAP measure. See – GAAP to Non-GAAP reconciliation.
| |
|
At or for the Three Months
Ended |
|
|
At or for the Nine Months
Ended |
|
| ALLOWANCE for CREDIT
LOSSES |
|
September 30,2024 |
|
|
June 30,2024 |
|
|
September 30,2023 |
|
|
September 30,2024 |
|
|
September 30,2023 |
|
| |
|
($ in thousands) |
|
| Allowance for loan
losses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance at beginning of
period |
|
$ |
23,788 |
|
|
$ |
22,254 |
|
|
$ |
22,502 |
|
|
$ |
22,569 |
|
|
$ |
17,099 |
|
| Adoption of ASU 2016-13
(1) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,027 |
|
| Initial Allowance for PCD
loans |
|
|
11,216 |
|
|
|
— |
|
|
|
— |
|
|
|
11,216 |
|
|
|
— |
|
| Provision for credit losses
(2) |
|
|
19,711 |
|
|
|
2,990 |
|
|
|
202 |
|
|
|
22,387 |
|
|
|
600 |
|
| Charge-offs |
|
|
(1,163 |
) |
|
|
(1,456 |
) |
|
|
— |
|
|
|
(2,620 |
) |
|
|
(36 |
) |
| Recoveries |
|
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
15 |
|
| Net (charge-offs)
recoveries |
|
|
(1,163 |
) |
|
|
(1,456 |
) |
|
|
1 |
|
|
|
(2,620 |
) |
|
|
(21 |
) |
| Balance, end of period |
|
$ |
53,552 |
|
|
$ |
23,788 |
|
|
$ |
22,705 |
|
|
$ |
53,552 |
|
|
$ |
22,705 |
|
| Reserve for unfunded
loan commitments (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, beginning of
period |
|
$ |
819 |
|
|
$ |
916 |
|
|
$ |
1,538 |
|
|
$ |
933 |
|
|
$ |
1,310 |
|
| Adoption of ASU 2016-13
(1) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
439 |
|
| Provision for (reversal of)
credit losses (4) |
|
|
3,252 |
|
|
|
(97 |
) |
|
|
(298 |
) |
|
|
3,138 |
|
|
|
(509 |
) |
| Balance, end of period |
|
|
4,071 |
|
|
|
819 |
|
|
|
1,240 |
|
|
|
4,071 |
|
|
|
1,240 |
|
| Allowance for credit
losses |
|
$ |
57,623 |
|
|
$ |
24,607 |
|
|
$ |
23,945 |
|
|
$ |
57,623 |
|
|
$ |
23,945 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ALL to total loans held for
investment |
|
|
1.67 |
% |
|
|
1.27 |
% |
|
|
1.18 |
% |
|
|
1.67 |
% |
|
|
1.18 |
% |
| ACL to total loans held for
investment |
|
|
1.80 |
% |
|
|
1.31 |
% |
|
|
1.24 |
% |
|
|
1.80 |
% |
|
|
1.24 |
% |
| Net (charge-offs) recoveries
to average total loans |
|
|
(0.17 |
)% |
|
|
(0.31 |
)% |
|
|
0.00 |
% |
|
|
(0.16 |
)% |
|
|
0.00 |
% |
|
(1 |
) |
Represents the impact of adopting ASU 2016-13, Financial
Instruments - Credit Losses on January 1, 2023. As a result of
adopting ASU 2016-13, our methodology to compute our allowance for
credit losses is based on a current expected credit loss
methodology, rather than the previously applied incurred loss
methodology. |
|
(2 |
) |
Includes $18.5 million for the three and nine months ended
September 30, 2024 related to the initial provision for credit
losses for non-PCD loans acquired in the merger with CALB. |
|
(3 |
) |
Included in “Accrued interest and other liabilities” on the
consolidated balance sheet. |
|
(4 |
) |
Includes $2.7 million for the three and nine months ended September
30, 2024 related to the initial provision for credit losses on
unfunded commitments acquired in the merger with CALB. |
California BanCorp and Subsidiary
Balance Sheets (Unaudited)
| |
|
September 30,2024 |
|
|
June 30,2024 |
|
|
December 31,2023 |
|
| ASSETS |
|
($ in thousands) |
|
| Cash and due from banks |
|
$ |
115,165 |
|
|
$ |
29,153 |
|
|
$ |
33,008 |
|
| Federal funds sold &
interest-bearing balances |
|
|
499,258 |
|
|
|
75,580 |
|
|
|
53,785 |
|
|
Total cash and cash equivalents |
|
|
614,423 |
|
|
|
104,733 |
|
|
|
86,793 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Debt securities
available-for-sale, at fair value (amortized cost of $163,384,
$132,862 and $136,366 at September 30, 2024, June 30, 2024 and
December 31, 2023) |
|
|
159,330 |
|
|
|
123,653 |
|
|
|
130,035 |
|
| Debt securities
held-to-maturity, at cost (fair value of $49,487, $48,476 and
$50,432 at September 30, 2024, June 30, 2024 and December 31,
2023) |
|
|
53,364 |
|
|
|
53,449 |
|
|
|
53,616 |
|
| Loans held for sale |
|
|
33,704 |
|
|
|
6,982 |
|
|
|
7,349 |
|
| Loans held for
investment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction & land development |
|
|
247,934 |
|
|
|
205,072 |
|
|
|
243,521 |
|
|
1-4 family residential |
|
|
152,540 |
|
|
|
157,323 |
|
|
|
143,903 |
|
|
Multifamily |
|
|
252,134 |
|
|
|
187,960 |
|
|
|
221,247 |
|
|
Other commercial real estate |
|
|
1,755,908 |
|
|
|
1,043,662 |
|
|
|
1,024,243 |
|
|
Commercial & industrial |
|
|
765,472 |
|
|
|
283,203 |
|
|
|
320,142 |
|
|
Other consumer |
|
|
25,726 |
|
|
|
397 |
|
|
|
4,386 |
|
|
Total loans held for investment |
|
|
3,199,714 |
|
|
|
1,877,617 |
|
|
|
1,957,442 |
|
|
Allowance for credit losses - loans |
|
|
(53,552 |
) |
|
|
(23,788 |
) |
|
|
(22,569 |
) |
|
Total loans held for investment, net |
|
|
3,146,162 |
|
|
|
1,853,829 |
|
|
|
1,934,873 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Restricted stock at cost |
|
|
27,394 |
|
|
|
16,898 |
|
|
|
16,055 |
|
| Premises and equipment |
|
|
13,996 |
|
|
|
12,741 |
|
|
|
13,270 |
|
| Right of use asset |
|
|
15,310 |
|
|
|
8,298 |
|
|
|
9,291 |
|
| Other real estate owned,
net |
|
|
4,083 |
|
|
|
— |
|
|
|
— |
|
| Goodwill |
|
|
112,515 |
|
|
|
37,803 |
|
|
|
37,803 |
|
| Core deposit intangible |
|
|
23,031 |
|
|
|
1,065 |
|
|
|
1,195 |
|
| Bank owned life insurance |
|
|
66,180 |
|
|
|
39,445 |
|
|
|
38,918 |
|
| Deferred taxes, net |
|
|
45,644 |
|
|
|
11,080 |
|
|
|
11,137 |
|
| Accrued interest and other
assets |
|
|
47,631 |
|
|
|
23,717 |
|
|
|
19,917 |
|
|
Total assets |
|
$ |
4,362,767 |
|
|
$ |
2,293,693 |
|
|
$ |
2,360,252 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
| Deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand |
|
$ |
1,368,303 |
|
|
$ |
666,606 |
|
|
$ |
675,098 |
|
|
Interest-bearing NOW accounts |
|
|
781,125 |
|
|
|
355,994 |
|
|
|
381,943 |
|
|
Money market and savings accounts |
|
|
1,149,268 |
|
|
|
660,808 |
|
|
|
636,685 |
|
|
Time deposits |
|
|
442,219 |
|
|
|
252,454 |
|
|
|
249,830 |
|
| Total deposits |
|
|
3,740,915 |
|
|
|
1,935,862 |
|
|
|
1,943,556 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Borrowings |
|
|
69,142 |
|
|
|
42,913 |
|
|
|
102,865 |
|
| Operating lease liability |
|
|
19,211 |
|
|
|
10,931 |
|
|
|
12,117 |
|
| Accrued interest and other
liabilities |
|
|
35,435 |
|
|
|
10,768 |
|
|
|
13,562 |
|
|
Total liabilities |
|
|
3,864,703 |
|
|
|
2,000,474 |
|
|
|
2,072,100 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Shareholders’
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
| Common stock - 50,000,000
shares authorized, no par value; issued and outstanding 32,142,427,
18,547,352 and 18,369,115 at September 30, 2024, June 30, 2024 and
December 31, 2023) |
|
|
441,684 |
|
|
|
224,006 |
|
|
|
222,036 |
|
| Retained earnings |
|
|
59,236 |
|
|
|
75,700 |
|
|
|
70,575 |
|
| Accumulated other
comprehensive loss - net of taxes |
|
|
(2,856 |
) |
|
|
(6,487 |
) |
|
|
(4,459 |
) |
|
Total shareholders’ equity |
|
|
498,064 |
|
|
|
293,219 |
|
|
|
288,152 |
|
|
Total liabilities and shareholders’ equity |
|
$ |
4,362,767 |
|
|
$ |
2,293,693 |
|
|
$ |
2,360,252 |
|
California BanCorp and Subsidiary
Income Statements - Quarterly and Year-to-Date (Unaudited)
| |
|
Three Months Ended |
|
|
Nine Months Ended |
|
| |
|
September 30,2024 |
|
|
June 30,2024 |
|
|
September 30,2023 |
|
|
September 30,2024 |
|
|
September 30,2023 |
|
| |
|
($ in thousands except share and per share data) |
|
| INTEREST AND DIVIDEND
INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest and fees on
loans |
|
$ |
47,528 |
|
|
$ |
29,057 |
|
|
$ |
28,977 |
|
|
$ |
105,169 |
|
|
$ |
83,983 |
|
| Interest on debt
securities |
|
|
1,687 |
|
|
|
1,229 |
|
|
|
942 |
|
|
|
4,129 |
|
|
|
2,506 |
|
| Interest on tax-exempted debt
securities |
|
|
306 |
|
|
|
306 |
|
|
|
359 |
|
|
|
918 |
|
|
|
1,302 |
|
| Interest and dividends from
other institutions |
|
|
4,606 |
|
|
|
1,257 |
|
|
|
1,206 |
|
|
|
7,024 |
|
|
|
3,162 |
|
|
Total interest and dividend income |
|
|
54,127 |
|
|
|
31,849 |
|
|
|
31,484 |
|
|
|
117,240 |
|
|
|
90,953 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| INTEREST
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest on NOW, savings, and
money market accounts |
|
|
11,073 |
|
|
|
7,039 |
|
|
|
5,922 |
|
|
|
24,882 |
|
|
|
13,555 |
|
| Interest on time deposits |
|
|
5,087 |
|
|
|
3,145 |
|
|
|
1,867 |
|
|
|
11,253 |
|
|
|
4,373 |
|
| Interest on borrowings |
|
|
1,025 |
|
|
|
658 |
|
|
|
434 |
|
|
|
2,662 |
|
|
|
1,446 |
|
|
Total interest expense |
|
|
17,185 |
|
|
|
10,842 |
|
|
|
8,223 |
|
|
|
38,797 |
|
|
|
19,374 |
|
|
Net interest income |
|
|
36,942 |
|
|
|
21,007 |
|
|
|
23,261 |
|
|
|
78,443 |
|
|
|
71,579 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Provision for (reversal of )
credit losses (1) |
|
|
22,963 |
|
|
|
2,893 |
|
|
|
(96 |
) |
|
|
25,525 |
|
|
|
91 |
|
|
Net interest income after provision for (reversal of) credit
losses |
|
|
13,979 |
|
|
|
18,114 |
|
|
|
23,357 |
|
|
|
52,918 |
|
|
|
71,488 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NONINTEREST
INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Service charges and fees on
deposit accounts |
|
|
1,136 |
|
|
|
568 |
|
|
|
470 |
|
|
|
2,229 |
|
|
|
1,439 |
|
| Gain on sale of loans |
|
|
8 |
|
|
|
— |
|
|
|
(54 |
) |
|
|
423 |
|
|
|
831 |
|
| Bank owned life insurance
income |
|
|
398 |
|
|
|
266 |
|
|
|
238 |
|
|
|
925 |
|
|
|
693 |
|
| Servicing and related income
(expense) on loans |
|
|
82 |
|
|
|
(5 |
) |
|
|
61 |
|
|
|
150 |
|
|
|
223 |
|
| Loss on sale of debt
securities |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
34 |
|
| Loss on sale of building and
related fixed assets |
|
|
— |
|
|
|
(19 |
) |
|
|
— |
|
|
|
(19 |
) |
|
|
— |
|
| Other charges and fees |
|
|
(450 |
) |
|
|
359 |
|
|
|
100 |
|
|
|
48 |
|
|
|
261 |
|
|
Total noninterest income |
|
|
1,174 |
|
|
|
1,169 |
|
|
|
815 |
|
|
|
3,756 |
|
|
|
3,481 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NONINTEREST
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Salaries and employee
benefits |
|
|
15,385 |
|
|
|
8,776 |
|
|
|
9,736 |
|
|
|
33,771 |
|
|
|
29,651 |
|
| Occupancy and equipment
expenses |
|
|
2,031 |
|
|
|
1,445 |
|
|
|
1,579 |
|
|
|
4,928 |
|
|
|
4,553 |
|
| Data processing |
|
|
1,536 |
|
|
|
1,186 |
|
|
|
1,144 |
|
|
|
3,872 |
|
|
|
3,376 |
|
| Legal, audit and
professional |
|
|
669 |
|
|
|
557 |
|
|
|
598 |
|
|
|
1,742 |
|
|
|
2,050 |
|
| Regulatory assessments |
|
|
544 |
|
|
|
347 |
|
|
|
369 |
|
|
|
1,278 |
|
|
|
1,188 |
|
| Director and shareholder
expenses |
|
|
520 |
|
|
|
229 |
|
|
|
215 |
|
|
|
952 |
|
|
|
642 |
|
| Merger and related
expenses |
|
|
14,605 |
|
|
|
491 |
|
|
|
— |
|
|
|
15,645 |
|
|
|
— |
|
| Core deposit intangible
amortization |
|
|
687 |
|
|
|
65 |
|
|
|
128 |
|
|
|
817 |
|
|
|
309 |
|
| Other real estate owned
expense |
|
|
3 |
|
|
|
4,935 |
|
|
|
— |
|
|
|
5,026 |
|
|
|
— |
|
| Other expense |
|
|
1,700 |
|
|
|
974 |
|
|
|
1,012 |
|
|
|
3,635 |
|
|
|
2,638 |
|
|
Total noninterest expense |
|
|
37,680 |
|
|
|
19,005 |
|
|
|
14,781 |
|
|
|
71,666 |
|
|
|
44,407 |
|
|
(Loss) income before income taxes |
|
|
(22,527 |
) |
|
|
278 |
|
|
|
9,391 |
|
|
|
(14,992 |
) |
|
|
30,562 |
|
| Income tax (benefit)
expense |
|
|
(6,063 |
) |
|
|
88 |
|
|
|
2,835 |
|
|
|
(3,653 |
) |
|
|
9,064 |
|
|
Net (loss) income |
|
$ |
(16,464 |
) |
|
$ |
190 |
|
|
$ |
6,556 |
|
|
$ |
(11,339 |
) |
|
$ |
21,498 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net (loss) income per share -
basic |
|
$ |
(0.59 |
) |
|
$ |
0.01 |
|
|
$ |
0.36 |
|
|
$ |
(0.53 |
) |
|
$ |
1.18 |
|
| Net (loss) income per share -
diluted |
|
$ |
(0.59 |
) |
|
$ |
0.01 |
|
|
$ |
0.35 |
|
|
$ |
(0.53 |
) |
|
$ |
1.15 |
|
| Weighted average common
shares-diluted |
|
|
27,705,844 |
|
|
|
18,799,513 |
|
|
|
18,672,132 |
|
|
|
21,579,175 |
|
|
|
18,632,890 |
|
| Pre-tax, pre-provision income
(2) |
|
$ |
436 |
|
|
$ |
3,171 |
|
|
$ |
9,295 |
|
|
$ |
10,533 |
|
|
$ |
30,653 |
|
(1) Included provision for (reversal of)
unfunded loan commitments of $3.3 million, $(97) thousand and
$(298) thousand for the three months ended September 30, 2024, June
30, 2024 and September 30, 2023, respectively, and $3.1 million and
$(509) thousand for the nine months ended September 30, 2024 and
2023, respectively(2) Non-GAAP measure. See – GAAP to Non-GAAP
reconciliation.
California BanCorp and SubsidiaryAverage
Balance Sheets and Yield Analysis(Unaudited)
| |
|
Three Months Ended |
|
| |
|
September 30, 2024 |
|
|
June 30, 2024 |
|
|
September 30, 2023 |
|
| |
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
| Assets |
|
($ in thousands) |
|
| Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total loans |
|
$ |
2,783,581 |
|
|
$ |
47,528 |
|
|
|
6.79 |
% |
|
$ |
1,882,845 |
|
|
$ |
29,057 |
|
|
|
6.21 |
% |
|
$ |
1,924,384 |
|
|
$ |
28,977 |
|
|
|
5.97 |
% |
| Taxable debt securities |
|
|
149,080 |
|
|
|
1,687 |
|
|
|
4.50 |
% |
|
|
123,906 |
|
|
|
1,229 |
|
|
|
3.99 |
% |
|
|
111,254 |
|
|
|
942 |
|
|
|
3.36 |
% |
| Tax-exempt debt securities
(1) |
|
|
53,682 |
|
|
|
306 |
|
|
|
2.87 |
% |
|
|
53,754 |
|
|
|
306 |
|
|
|
2.90 |
% |
|
|
59,630 |
|
|
|
359 |
|
|
|
3.02 |
% |
| Deposits in other financial
institutions |
|
|
161,616 |
|
|
|
2,215 |
|
|
|
5.45 |
% |
|
|
47,417 |
|
|
|
638 |
|
|
|
5.41 |
% |
|
|
50,367 |
|
|
|
681 |
|
|
|
5.36 |
% |
| Fed funds sold/resale
agreements |
|
|
143,140 |
|
|
|
1,886 |
|
|
|
5.24 |
% |
|
|
19,062 |
|
|
|
261 |
|
|
|
5.51 |
% |
|
|
20,653 |
|
|
|
283 |
|
|
|
5.44 |
% |
| Restricted stock investments
and other bank stock |
|
|
24,587 |
|
|
|
505 |
|
|
|
8.17 |
% |
|
|
17,091 |
|
|
|
358 |
|
|
|
8.42 |
% |
|
|
16,365 |
|
|
|
242 |
|
|
|
5.87 |
% |
|
Total interest-earning assets |
|
|
3,315,686 |
|
|
|
54,127 |
|
|
|
6.49 |
% |
|
|
2,144,075 |
|
|
|
31,849 |
|
|
|
5.97 |
% |
|
|
2,182,653 |
|
|
|
31,484 |
|
|
|
5.72 |
% |
| Total noninterest-earning
assets |
|
|
277,471 |
|
|
|
|
|
|
|
|
|
|
|
150,603 |
|
|
|
|
|
|
|
|
|
|
|
131,288 |
|
|
|
|
|
|
|
|
|
| Total
assets |
|
$ |
3,593,157 |
|
|
|
|
|
|
|
|
|
|
$ |
2,294,678 |
|
|
|
|
|
|
|
|
|
|
$ |
2,313,941 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing NOW
accounts |
|
$ |
617,373 |
|
|
$ |
2,681 |
|
|
|
1.73 |
% |
|
$ |
361,244 |
|
|
$ |
2,134 |
|
|
|
2.38 |
% |
|
$ |
353,714 |
|
|
$ |
1,706 |
|
|
|
1.91 |
% |
| Money market and savings
accounts |
|
|
999,322 |
|
|
|
8,392 |
|
|
|
3.34 |
% |
|
|
653,244 |
|
|
|
4,905 |
|
|
|
3.02 |
% |
|
|
675,609 |
|
|
|
4,216 |
|
|
|
2.48 |
% |
| Time deposits |
|
|
421,241 |
|
|
|
5,087 |
|
|
|
4.80 |
% |
|
|
259,722 |
|
|
|
3,145 |
|
|
|
4.87 |
% |
|
|
183,745 |
|
|
|
1,867 |
|
|
|
4.03 |
% |
|
Total interest-bearing deposits |
|
|
2,037,936 |
|
|
|
16,160 |
|
|
|
3.15 |
% |
|
|
1,274,210 |
|
|
|
10,184 |
|
|
|
3.21 |
% |
|
|
1,213,068 |
|
|
|
7,789 |
|
|
|
2.55 |
% |
| Borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| FHLB advances |
|
|
611 |
|
|
|
9 |
|
|
|
5.86 |
% |
|
|
27,391 |
|
|
|
387 |
|
|
|
5.68 |
% |
|
|
11,731 |
|
|
|
163 |
|
|
|
5.51 |
% |
| Subordinated debt |
|
|
52,246 |
|
|
|
1,016 |
|
|
|
7.74 |
% |
|
|
17,901 |
|
|
|
271 |
|
|
|
6.09 |
% |
|
|
17,830 |
|
|
|
271 |
|
|
|
6.03 |
% |
|
Total borrowings |
|
|
52,857 |
|
|
|
1,025 |
|
|
|
7.71 |
% |
|
|
45,292 |
|
|
|
658 |
|
|
|
5.84 |
% |
|
|
29,561 |
|
|
|
434 |
|
|
|
5.82 |
% |
| Total interest-bearing
liabilities |
|
|
2,090,793 |
|
|
|
17,185 |
|
|
|
3.27 |
% |
|
|
1,319,502 |
|
|
|
10,842 |
|
|
|
3.30 |
% |
|
|
1,242,629 |
|
|
|
8,223 |
|
|
|
2.63 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing deposits
(2) |
|
|
1,031,844 |
|
|
|
|
|
|
|
|
|
|
|
658,001 |
|
|
|
|
|
|
|
|
|
|
|
768,148 |
|
|
|
|
|
|
|
|
|
| Other liabilities |
|
|
41,962 |
|
|
|
|
|
|
|
|
|
|
|
23,054 |
|
|
|
|
|
|
|
|
|
|
|
25,722 |
|
|
|
|
|
|
|
|
|
| Shareholders’ equity |
|
|
428,558 |
|
|
|
|
|
|
|
|
|
|
|
294,121 |
|
|
|
|
|
|
|
|
|
|
|
277,442 |
|
|
|
|
|
|
|
|
|
| Total Liabilities and
Shareholders’ Equity |
|
$ |
3,593,157 |
|
|
|
|
|
|
|
|
|
|
$ |
2,294,678 |
|
|
|
|
|
|
|
|
|
|
$ |
2,313,941 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest spread |
|
|
|
|
|
|
|
|
|
|
3.22 |
% |
|
|
|
|
|
|
|
|
|
|
2.67 |
% |
|
|
|
|
|
|
|
|
|
|
3.09 |
% |
| Net interest income
and margin |
|
|
|
|
|
$ |
36,942 |
|
|
|
4.43 |
% |
|
|
|
|
|
$ |
21,007 |
|
|
|
3.94 |
% |
|
|
|
|
|
$ |
23,261 |
|
|
|
4.23 |
% |
| Cost of deposits |
|
$ |
3,069,780 |
|
|
$ |
16,160 |
|
|
|
2.09 |
% |
|
$ |
1,932,211 |
|
|
$ |
10,184 |
|
|
|
2.12 |
% |
|
$ |
1,981,216 |
|
|
$ |
7,789 |
|
|
|
1.56 |
% |
| Cost of funds |
|
$ |
3,122,637 |
|
|
$ |
17,185 |
|
|
|
2.19 |
% |
|
$ |
1,977,503 |
|
|
$ |
10,842 |
|
|
|
2.21 |
% |
|
$ |
2,010,777 |
|
|
$ |
8,223 |
|
|
|
1.62 |
% |
(1) Tax-exempt debt securities yields are
presented on a tax equivalent basis using a 21% tax rate.(2)
Average noninterest-bearing deposits represent 33.61%, 34.05% and
38.77% of average total deposits for the three months ended
September 30, 2024, June 30, 2024 and September 30, 2023,
respectively.
California BanCorp and SubsidiaryAverage
Balance Sheets and Yield Analysis(Unaudited)
| |
|
Nine Months Ended |
|
| |
|
September 30, 2024 |
|
|
September 30, 2023 |
|
| |
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
| Assets |
|
($ in thousands) |
|
| Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total loans |
|
$ |
2,194,059 |
|
|
$ |
105,169 |
|
|
|
6.40 |
% |
|
$ |
1,906,327 |
|
|
$ |
83,983 |
|
|
|
5.89 |
% |
| Taxable debt securities |
|
|
133,321 |
|
|
|
4,129 |
|
|
|
4.14 |
% |
|
|
104,881 |
|
|
|
2,506 |
|
|
|
3.19 |
% |
| Tax-exempt debt securities
(1) |
|
|
53,759 |
|
|
|
918 |
|
|
|
2.89 |
% |
|
|
68,043 |
|
|
|
1,302 |
|
|
|
3.24 |
% |
| Deposits in other financial
institutions |
|
|
87,966 |
|
|
|
3,569 |
|
|
|
5.42 |
% |
|
|
43,629 |
|
|
|
1,675 |
|
|
|
5.13 |
% |
| Fed funds sold/resale
agreements |
|
|
57,634 |
|
|
|
2,281 |
|
|
|
5.29 |
% |
|
|
21,182 |
|
|
|
798 |
|
|
|
5.04 |
% |
| Restricted stock investments
and other bank stock |
|
|
19,383 |
|
|
|
1,174 |
|
|
|
8.09 |
% |
|
|
15,774 |
|
|
|
689 |
|
|
|
5.84 |
% |
|
Total interest-earning assets |
|
|
2,546,122 |
|
|
|
117,240 |
|
|
|
6.15 |
% |
|
|
2,159,836 |
|
|
|
90,953 |
|
|
|
5.63 |
% |
| Total noninterest-earning
assets |
|
|
189,573 |
|
|
|
|
|
|
|
|
|
|
|
133,224 |
|
|
|
|
|
|
|
|
|
| Total
assets |
|
$ |
2,735,695 |
|
|
|
|
|
|
|
|
|
|
$ |
2,293,060 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing NOW
accounts |
|
$ |
446,759 |
|
|
$ |
6,860 |
|
|
|
2.05 |
% |
|
$ |
290,326 |
|
|
$ |
3,301 |
|
|
|
1.52 |
% |
| Money market and savings
accounts |
|
|
767,916 |
|
|
|
18,022 |
|
|
|
3.13 |
% |
|
|
674,452 |
|
|
|
10,254 |
|
|
|
2.03 |
% |
| Time deposits |
|
|
312,544 |
|
|
|
11,253 |
|
|
|
4.81 |
% |
|
|
170,620 |
|
|
|
4,373 |
|
|
|
3.43 |
% |
|
Total interest-bearing deposits |
|
|
1,527,219 |
|
|
|
36,135 |
|
|
|
3.16 |
% |
|
|
1,135,398 |
|
|
|
17,928 |
|
|
|
2.11 |
% |
| Borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| FHLB advances |
|
|
26,105 |
|
|
|
1,103 |
|
|
|
5.64 |
% |
|
|
16,282 |
|
|
|
632 |
|
|
|
5.19 |
% |
| Subordinated debt |
|
|
29,425 |
|
|
|
1,559 |
|
|
|
7.08 |
% |
|
|
17,807 |
|
|
|
814 |
|
|
|
6.11 |
% |
|
Total borrowings |
|
|
55,530 |
|
|
|
2,662 |
|
|
|
6.40 |
% |
|
|
34,089 |
|
|
|
1,446 |
|
|
|
5.67 |
% |
| Total interest-bearing
liabilities |
|
|
1,582,749 |
|
|
|
38,797 |
|
|
|
3.27 |
% |
|
|
1,169,487 |
|
|
|
19,374 |
|
|
|
2.21 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing deposits
(2) |
|
|
784,609 |
|
|
|
|
|
|
|
|
|
|
|
829,082 |
|
|
|
|
|
|
|
|
|
| Other liabilities |
|
|
30,524 |
|
|
|
|
|
|
|
|
|
|
|
24,086 |
|
|
|
|
|
|
|
|
|
| Shareholders’ equity |
|
|
337,813 |
|
|
|
|
|
|
|
|
|
|
|
270,405 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Liabilities and
Shareholders’ Equity |
|
$ |
2,735,695 |
|
|
|
|
|
|
|
|
|
|
$ |
2,293,060 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest spread |
|
|
|
|
|
|
|
|
|
|
2.88 |
% |
|
|
|
|
|
|
|
|
|
|
3.42 |
% |
| Net interest income
and margin |
|
|
|
|
|
$ |
78,443 |
|
|
|
4.12 |
% |
|
|
|
|
|
$ |
71,579 |
|
|
|
4.43 |
% |
| Cost of deposits |
|
$ |
2,311,828 |
|
|
$ |
36,135 |
|
|
|
2.09 |
% |
|
$ |
1,964,480 |
|
|
$ |
17,928 |
|
|
|
1.22 |
% |
| Cost of funds |
|
$ |
2,367,358 |
|
|
$ |
38,797 |
|
|
|
2.19 |
% |
|
$ |
1,998,569 |
|
|
$ |
19,374 |
|
|
|
1.30 |
% |
(1) Tax-exempt debt securities yields are
presented on a tax equivalent basis using a 21% tax rate.(2)
Average noninterest-bearing deposits represent 33.94%, and 42.20%
of average total deposits for the nine months ended September 30,
2024 and September 30, 2023, respectively.
California BanCorp and SubsidiaryGAAP to
Non-GAAP Reconciliation(Unaudited)
The following tables present a reconciliation of
non-GAAP financial measures to GAAP measures for: (1) adjusted net
(loss) income, (2) efficiency ratio, (3) adjusted efficiency ratio,
(4) pre-tax pre-provision income, (5) adjusted pre-tax
pre-provision income, (6) average tangible common equity, (7)
adjusted return on average assets, (8) adjusted return on average
equity, (9) return on average tangible common equity, (10) adjusted
return on average tangible common equity, (11) tangible common
equity, (12) tangible assets, (13) tangible common equity to
tangible asset ratio, and (14) tangible book value per share. We
believe the presentation of certain non-GAAP financial measures
provides useful information to assess our consolidated financial
condition and consolidated results of operations and to assist
investors in evaluating our financial results relative to our
peers. These non-GAAP financial measures complement our GAAP
reporting and are presented below to provide investors and others
with information that we use to manage the business each period.
Because not all companies use identical calculations, the
presentation of these non-GAAP financial measures may not be
comparable to other similarly titled measures used by other
companies. These non-GAAP measures should be taken together with
the corresponding GAAP measures and should not be considered a
substitute of the GAAP measures.
| |
|
Three Months Ended |
|
|
Nine Months Ended |
|
| |
|
September 30,2024 |
|
|
June 30,2024 |
|
|
September 30,2023 |
|
|
September 30,2024 |
|
|
September 30,2023 |
|
| |
|
($ in thousands) |
|
|
Adjusted net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net (loss) income |
|
$ |
(16,464 |
) |
|
$ |
190 |
|
|
$ |
6,556 |
|
|
$ |
(11,339 |
) |
|
$ |
21,498 |
|
| Add: After-tax Day1 provision
for non PCD loans and unfunded loan commitments (1) |
|
|
14,978 |
|
|
|
— |
|
|
|
— |
|
|
|
14,978 |
|
|
|
— |
|
| Add: After-tax merger and
related expenses (1) |
|
|
10,576 |
|
|
|
412 |
|
|
|
— |
|
|
|
11,535 |
|
|
|
— |
|
| Adjusted net (loss) income
(non-GAAP) |
|
$ |
9,090 |
|
|
$ |
602 |
|
|
$ |
6,556 |
|
|
$ |
15,174 |
|
|
$ |
21,498 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest expense |
|
$ |
37,680 |
|
|
$ |
19,005 |
|
|
$ |
14,781 |
|
|
$ |
71,666 |
|
|
$ |
44,407 |
|
| Deduct: Merger and related
expenses |
|
|
14,605 |
|
|
|
491 |
|
|
|
— |
|
|
|
15,645 |
|
|
|
— |
|
| Adjusted noninterest
expense |
|
|
23,075 |
|
|
|
18,514 |
|
|
|
14,781 |
|
|
|
56,021 |
|
|
|
44,407 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest income |
|
|
36,942 |
|
|
|
21,007 |
|
|
|
23,261 |
|
|
|
78,443 |
|
|
|
71,579 |
|
| Noninterest income |
|
|
1,174 |
|
|
|
1,169 |
|
|
|
815 |
|
|
|
3,756 |
|
|
|
3,481 |
|
| Total net interest income and
noninterest income |
|
$ |
38,116 |
|
|
$ |
22,176 |
|
|
$ |
24,076 |
|
|
$ |
82,199 |
|
|
$ |
75,060 |
|
| Efficiency ratio
(non-GAAP) |
|
|
98.9 |
% |
|
|
85.7 |
% |
|
|
61.4 |
% |
|
|
87.2 |
% |
|
|
59.2 |
% |
| Adjusted efficiency ratio
(non-GAAP) |
|
|
60.5 |
% |
|
|
83.5 |
% |
|
|
61.4 |
% |
|
|
68.2 |
% |
|
|
59.2 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax pre-provision income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest income |
|
$ |
36,942 |
|
|
$ |
21,007 |
|
|
$ |
23,261 |
|
|
$ |
78,443 |
|
|
$ |
71,579 |
|
| Noninterest income |
|
|
1,174 |
|
|
|
1,169 |
|
|
|
815 |
|
|
|
3,756 |
|
|
|
3,481 |
|
| Total net interest income and
noninterest income |
|
|
38,116 |
|
|
|
22,176 |
|
|
|
24,076 |
|
|
|
82,199 |
|
|
|
75,060 |
|
| Less: Noninterest expense |
|
|
37,680 |
|
|
|
19,005 |
|
|
|
14,781 |
|
|
|
71,666 |
|
|
|
44,407 |
|
| Pre-tax pre-provision income
(non-GAAP) |
|
|
436 |
|
|
|
3,171 |
|
|
|
9,295 |
|
|
|
10,533 |
|
|
|
30,653 |
|
| Add: Merger and related
expenses |
|
|
14,605 |
|
|
|
491 |
|
|
|
— |
|
|
|
15,645 |
|
|
|
— |
|
| Adjusted pre-tax pre-provision
income (non-GAAP) |
|
$ |
15,041 |
|
|
$ |
3,662 |
|
|
$ |
9,295 |
|
|
$ |
26,178 |
|
|
$ |
30,653 |
|
(1) After-tax merger and related expenses are presented using a
29.56% tax rate.
|
Return on Average Assets, Equity, and Tangible
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net (loss) income |
|
$ |
(16,464 |
) |
|
$ |
190 |
|
|
$ |
6,556 |
|
|
$ |
(11,339 |
) |
|
$ |
21,498 |
|
| Adjusted net (loss) income
(non-GAAP) |
|
$ |
9,090 |
|
|
$ |
602 |
|
|
$ |
6,556 |
|
|
$ |
15,174 |
|
|
$ |
21,498 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Average assets |
|
$ |
3,593,157 |
|
|
$ |
2,294,678 |
|
|
$ |
2,313,941 |
|
|
$ |
2,735,695 |
|
|
$ |
2,293,060 |
|
| Average shareholders’
equity |
|
|
428,558 |
|
|
|
294,121 |
|
|
|
277,442 |
|
|
|
337,813 |
|
|
|
270,405 |
|
| Less: Average intangible
assets |
|
|
104,409 |
|
|
|
38,900 |
|
|
|
39,158 |
|
|
|
60,917 |
|
|
|
39,249 |
|
| Average tangible common equity
(non-GAAP) |
|
$ |
324,149 |
|
|
$ |
255,221 |
|
|
$ |
238,284 |
|
|
$ |
276,896 |
|
|
$ |
231,156 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Return on average assets |
|
|
(1.82 |
%) |
|
|
0.03 |
% |
|
|
1.12 |
% |
|
|
(0.55 |
%) |
|
|
1.25 |
% |
| Adjusted return on average
assets (non-GAAP) |
|
|
1.01 |
% |
|
|
0.11 |
% |
|
|
1.12 |
% |
|
|
0.74 |
% |
|
|
1.25 |
% |
| Return on average equity |
|
|
(15.28 |
%) |
|
|
0.26 |
% |
|
|
9.38 |
% |
|
|
(4.48 |
%) |
|
|
10.63 |
% |
| Adjusted return on average
equity (non-GAAP) |
|
|
8.44 |
% |
|
|
0.82 |
% |
|
|
9.38 |
% |
|
|
6.00 |
% |
|
|
10.63 |
% |
| Return on average tangible
common equity (non-GAAP) |
|
|
(20.21 |
%) |
|
|
0.30 |
% |
|
|
10.92 |
% |
|
|
(5.47 |
%) |
|
|
12.43 |
% |
| Adjusted return on average
tangible common equity (non-GAAP) |
|
|
11.16 |
% |
|
|
0.95 |
% |
|
|
10.92 |
% |
|
|
7.32 |
% |
|
|
12.43 |
% |
| |
|
September 30,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands except share and per share data) |
|
|
Tangible Common Equity Ratio/Tangible Book Value Per
Share |
|
|
|
|
|
|
|
|
| Shareholders’ equity |
|
$ |
498,064 |
|
|
$ |
288,152 |
|
| Less: Intangible assets |
|
|
135,546 |
|
|
|
38,998 |
|
| Tangible common equity
(non-GAAP) |
|
$ |
362,518 |
|
|
$ |
249,154 |
|
| |
|
|
|
|
|
|
|
|
| Total assets |
|
$ |
4,362,767 |
|
|
$ |
2,360,252 |
|
| Less: Intangible assets |
|
|
135,546 |
|
|
|
38,998 |
|
| Tangible assets
(non-GAAP) |
|
$ |
4,227,221 |
|
|
$ |
2,321,254 |
|
| |
|
|
|
|
|
|
|
|
| Equity to asset ratio |
|
|
11.42 |
% |
|
|
12.21 |
% |
| Tangible common equity to
tangible asset ratio (non-GAAP) |
|
|
8.58 |
% |
|
|
10.73 |
% |
| Book value per share |
|
$ |
15.50 |
|
|
$ |
15.69 |
|
| Tangible book value per share
(non-GAAP) |
|
$ |
11.28 |
|
|
$ |
13.56 |
|
| Shares outstanding |
|
|
32,142,427 |
|
|
|
18,369,115 |
|
INVESTOR RELATIONS CONTACTKevin Mc
CabeCalifornia Bank of Commerce,
N.A.kmccabe@bankcbc.com818.637.7065
California BanCorp (NASDAQ:BCAL)
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