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
fourth quarter and full year of 2024.
The Company reported net income of
$16.8 million, or $0.51 per diluted share, for the fourth
quarter of 2024, compared to a net loss of $16.5 million, or
$0.59 per diluted share for the third quarter of 2024, and net
income of $4.4 million, or $0.24 per diluted share for the
fourth quarter of 2023. The Company reported net income of
$5.4 million, or $0.22 per diluted share, for the full year of
2024, compared to net income of $25.9 million, or $1.39 per
diluted share for the full year of 2023.
“I’m pleased to report our strong fourth quarter
earnings of $16.8 million, the result of a full quarter of
combined operations after our July 31, 2024, merger close,” said
David Rainer, Executive Chairman of the Company and Bank. “We
continue to derisk our consolidated balance sheet and are making
significant headway in reducing our exposure in the Sponsor Finance
portfolio. Additionally, we are rapidly reducing our reliance on
brokered deposits, which despite the reduction of the high-yielding
Sponsor Finance product, has allowed us to maintain a consistent,
strong net interest margin. We are focused on building tangible
book value, which increased to $11.71 in the fourth quarter, up
$0.43 from the prior quarter, and up $0.79 in the five months since
the merger close. While we are pleased to report these strong
financial results, we, along with all our fellow Southern
California residents, have been through a very difficult period due
to the recent wildfires and we are working with all our
constituents to assist them in any way we can.”
“On behalf of the Company and the Bank, I want
to express our condolences to all our neighbors, clients and
employees that have been affected by the recent Southern California
wildfires,” said Steven Shelton, CEO of the Company and the Bank.
“You are in our thoughts and prayers and will remain so as we work
to rebuild and recover going forward. Except for the one-day
closure of one branch as a precautionary measure for the safety of
our employees, I’m pleased to report there were no other
disruptions to our operations and all other offices remained open.
We are fortunate to report that the fires are expected to have a
minimal impact on our loan portfolio, and we continue to focus on
providing outstanding service to our combined client base
throughout California, and on building shareholder value.”
Fourth Quarter 2024 Highlights
- Net income of
$16.8 million or $0.51 diluted earnings per share for the
fourth quarter; adjusted net income (non-GAAP1) was
$17.2 million or $0.53 per share for the fourth quarter.
- Net interest
margin of 4.61%, compared with 4.43% in the prior quarter;
average total loan yield of 6.84% compared with 6.79% in the prior
quarter.
- Reversal of provision for
credit losses of $3.8 million for the fourth quarter,
compared with a provision for credit losses of $23.0 million
for the prior quarter, of which $21.3 million was due to the
day one provision for credit losses on non-purchased credit
deteriorated (“non-PCD”) loans and unfunded loan commitments
related to the merger with California BanCorp (the “Merger”).
- Return on average
assets of 1.60%, compared with (1.82)% in the prior
quarter.
- Return on average common
equity of 13.21%, compared with (15.28)% in the prior
quarter.
- Efficiency ratio
(non-GAAP1) of 57.4%
compared with 98.9% in the prior quarter; excluding Merger related
expenses the efficiency ratio was 55.9%, compared with 60.5% in the
prior quarter.
- Tangible book value per
common share ("TBV")
(non-GAAP1) of $11.71 at
December 31, 2024, up $0.43 from $11.28 at September 30,
2024.
- Total assets of
$4.03 billion at December 31, 2024, compared with $4.36
billion at September 30, 2024.
- Total
loans, including loans held for sale of $3.16 billion at
December 31, 2024, compared with $3.23 billion at
September 30, 2024.
-
Nonperforming assets to total assets
ratio of 0.76% at December 31, 2024, compared
with 0.68% at September 30, 2024.
-
Allowance for credit losses (“ACL”) was 1.71% of
total loans held for investment at December 31, 2024;
allowance for loan losses ("ALL") was 1.61% of total loans held for
investment at December 31, 2024.
- Total deposits of
$3.40 billion at December 31, 2024, decreased $342.2 million
or 9.1% compared with $3.74 billion at September 30,
2024.
- Noninterest-bearing demand
deposits of $1.26 billion at December 31, 2024, a
decrease of $111.3 million or 8.1% from September 30, 2024;
noninterest bearing deposits represented 37.0% of total deposits,
compared with $1.37 billion, or 36.6% of total deposits at
September 30, 2024.
- Total
brokered deposits of $121.1 million, a decrease of $101.5
million from September 30, 2024.
- Cost of deposits
was 1.87%, compared with 2.09% in the prior quarter.
- Cost of funds was
1.99%, compared with 2.19% in the prior quarter.
- The
Company’s preliminary capital
exceeds minimums required to be
“well-capitalized,” the highest
regulatory capital category.
Full Year 2024 Highlights
- Merger
closed on July 31, 2024, whereby predecessor California
BanCorp (“CALB”) merged with and into the Company and California
Bank of Commerce merged with and into the Bank. CALB had total
loans of $1.43 billion, total assets of $1.91 billion, and total
deposits of $1.64 billion. 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. Total aggregate consideration paid for the Merger was
approximately $216.6 million and resulted in approximately
$74.7 million of preliminary goodwill, subject to adjustment
in accordance with ASC 805.
- Net
income of $5.4 million, down $20.5 million, or
79.0% from the prior year largely due to the after-tax one-time day
one provision for credit losses related to non-PCD loans and
unfunded loan commitments of $15.0 million and merger related
expenses of $12.0 million; adjusted net income (non-GAAP1) was
$32.4 million or $1.32 per share for the year.
- Diluted
earnings per share of $0.22, down $1.17, or 84.2% from the
prior year.
- Total
loan interest income increased to $160.0 million, up
$46.0 million or 40.4% from the prior year largely due to the
Merger.
- Net
interest margin of 4.28% for 2024, compared with 4.33% in
the prior year; average loan yield was 6.55%, up from 5.94% in the
prior year.
-
Efficiency ratio
(non-GAAP1) of 76.6%,
compared to 61.3% in the prior year; excluding merger related
expenses the efficiency ratio was 63.8%, compared with 61.3% in the
prior year.
-
Provision for credit losses of $21.7 million,
of which $21.3 million was due to the day one provision for
credit losses on non-PCD loans and unfunded loan commitments in
connection with the Merger, compared to $915 thousand for the
year ended December 31, 2023.
- Total assets of
$4.03 billion, up $1.7 billion or 70.8% from December 31,
2023, largely due to the Merger.
- Total
loans, including loans held for sale, increased to $3.16
billion, up $1.2 billion from December 31, 2023, largely due
to the Merger, with the fair value of the acquired loans totaling
$1.36 billion.
- Total
deposits of $3.40 billion, up $1.46 billion from
December 31, 2023, largely due to the $1.64 billion of
deposits acquired in the Merger.
-
Noninterest-bearing demand deposits were $1.26
billion, representing 37.0% of total deposits, compared to $675.1
million, or 34.7% of total deposits at December 31, 2023.
- Cost of
deposits was 2.01%, up from 1.37% in the prior year.
- Tangible book value per
common share ("TBV")
(non-GAAP1) of $11.71 at
December 31, 2024, down $1.85 from December 31, 2023.
Fourth Quarter Operating Results
Net Income
Net income for the fourth quarter of 2024 was
$16.8 million, or $0.51 per diluted share, compared with a net loss
of $16.5 million, or a loss of $0.59 per diluted share in the third
quarter of 2024. Our third quarter results were negatively impacted
by a day one $15.0 million after-tax current expected credit losses
(“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. Pre-tax, pre-provision income
(non-GAAP1) for the fourth quarter was $19.4 million, an increase
of $19.0 million from the prior quarter. Excluding the merger and
related expenses, the adjusted pre-tax, pre-provision income
(non-GAAP1) for the fourth quarter was $20.1 million, an increase
of $5.0 million from the prior quarter. The net income and diluted
earnings per share increases for all of the periods presented were
largely driven by the Merger and the operating results since the
closing date of the Merger.
Net Interest Income and Net Interest Margin
Net interest income for the fourth quarter of
2024 was $44.5 million, compared with $36.9 million in
the prior quarter. The increase in net interest income was
primarily due to an $8.4 million increase in total interest
and dividend income, partially offset by an $832 thousand increase
in total interest expense in the fourth quarter of 2024, as
compared to the prior quarter. During the fourth quarter of 2024,
loan interest income increased $7.3 million, of which
$6.1 million was related to accretion income from the net
purchase accounting discounts on acquired loans, total debt
securities income increased $10 thousand, and interest and
dividend income from other financial institutions increased
$1.2 million. The increase in interest income was mainly due
to reporting a full quarter of combined operations for the fourth
quarter of 2024 and primarily driven by the mix of interest-earning
assets added by the Merger and the impact of the accretion and
amortization of fair value interest rate marks. Average total
interest-earning assets increased $526.5 million in the fourth
quarter of 2024, the result of a $401.3 million increase in
average total loans, a $260.4 million increase in average
deposits in other financial institutions and a $5.8 million
increase in average restricted stock investments and other bank
stock, partially offset by a $1.3 million decrease in average
total debt securities and a $139.8 million decrease in average
Fed funds sold/resale agreements. The increase in interest expense
for the fourth quarter of 2024 was primarily due to a $466 thousand
increase in interest expense on interest-bearing deposits, the
result of a $217.9 million increase in average
interest-bearing deposits, coupled with a $17.2 million
increase in average subordinated debt, partially offset by a 22
basis point decrease in average interest-bearing deposit costs, and
a $9 thousand decrease in interest expense on Federal Home
Loan Bank ("FHLB") borrowings, the result of a $611 thousand
decrease in average FHLB borrowings in the fourth quarter of
2024.
Net interest margin for the fourth quarter of
2024 was 4.61%, compared with 4.43% in the prior quarter. The
increase was primarily related to a 20 basis point decrease in the
cost of funds, partially offset by a one basis point decrease in
the total interest-earning assets yield. The yield on total average
interest-earning assets in the fourth quarter of 2024 was 6.48%,
compared with 6.49% in the prior quarter. The yield on average
total loans in the fourth quarter of 2024 was 6.84%, an increase of
five basis points from 6.79% in the prior quarter. Accretion income
from the net purchase accounting discounts on acquired loans was
$6.1 million, increasing the yield on average total loans by
76 basis points; the net amortization expense from the purchase
accounting discounts on acquired subordinated debt and acquired
time deposits premium increased the interest expense by $467
thousand, the combination of which increased the net interest
margin by 58 basis points in the fourth quarter of 2024.
Cost of funds for the fourth quarter of 2024 was
1.99%, a decrease of 20 basis points from 2.19% in the prior
quarter. The decrease was primarily driven by a 22 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 26 basis points in the cost of total borrowings,
which was driven primarily by the amortization expense of
$559 thousand from the purchase accounting discounts on
acquired subordinated debt which increased the cost on total
borrowing by 320 basis points. Average noninterest-bearing demand
deposits increased $251.7 million to $1.28 billion and
represented 36.3% of total average deposits for the fourth quarter
of 2024, compared with $1.03 billion and 33.6%, respectively,
in the prior quarter; average interest-bearing deposits increased
$217.9 million to $2.26 billion during the fourth quarter of
2024. The total cost of deposits in the fourth quarter of 2024 was
1.87%, a decrease of 22 basis points from 2.09% in the prior
quarter. The cost of total interest-bearing deposits decreased
primarily due to the Company’s deposit repricing strategy and the
ongoing pay off of high cost brokered deposits and California State
certificates of deposit in the fourth quarter of 2024.
Average total borrowings increased
$16.6 million to $69.4 million in the fourth quarter of
2024, primarily due to an increase of $17.2 million in average
subordinated debt acquired in the Merger, partially offset by a
decrease of $611 thousand in average FHLB borrowings during
the fourth quarter of 2024. The average cost of total borrowings
was 7.97% for the fourth quarter of 2024, up from 7.71% in the
prior quarter.
(Reversal of) Provision for Credit Losses
The Company recorded a reversal of provision for
credit losses of $3.8 million in the fourth quarter of 2024,
compared to a provision for credit losses of $23.0 million in
the prior quarter. The decrease was largely related to the third
quarter provision for credit losses including the effects of the
Merger, and the resulting one-time initial provision for credit
losses on acquired non-PCD loans of $18.5 million and unfunded
loan commitments of $2.7 million. Total net charge-offs were
$154.0 thousand in the fourth quarter of 2024, which included
$103 thousand from an acquired consumer solar loan portfolio and
$51 thousand from a commercial real-estate loan. The provision for
credit losses in the fourth quarter of 2024 included a
$1.0 million reversal of provision for unfunded loan
commitments related to the decrease in unfunded loan commitments
during the fourth quarter of 2024, coupled with lower loss rates,
offset by higher average funding rates used to estimate the
allowance for credit losses on unfunded commitments. Total unfunded
loan commitments decreased $108.6 million to
$925.3 million at December 31, 2024, compared to $1.03
billion in unfunded loan commitments at September 30,
2024.
The reversal of provision for credit losses for
loans held for investment in the fourth quarter of 2024 was
$2.9 million, a decrease of $22.6 million for the fourth
quarter of 2024 from a provision for credit losses of
$19.7 million in the prior quarter. The decrease was driven
primarily by the third quarter amount including the one-time
initial provision for credit losses on acquired non-PCD loans and
decreases in legacy special mention loans and loans held for
investment. Additionally, qualitative factors, coupled with changes
in the portfolio mix and in the reasonable and supportable
forecast, primarily related to the economic outlook for California,
which were partially offset by an increase in legacy substandard
accruing loans, were factors related to the decrease 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
$1.0 million in the fourth quarter of 2024, a decrease of
$170 thousand compared to $1.2 million in the third
quarter of 2024. The Company reported a loss on sale of loans of
$1.1 million, related to the sale of certain Sponsor Finance loans,
in the fourth quarter of 2024, compared to a gain on sale of loans
of $8 thousand in the prior quarter. There was no gain on SBA 7A
loan sales in the third and fourth quarters of 2024. Bank owned
life insurance income of $823 thousand in the fourth quarter of
2024 increased $425 thousand from the prior quarter. Service
charges and fees on deposit accounts of $911 thousand in the
fourth quarter of 2024 decreased $225 thousand from the prior
quarter, related to the one-time waiver of analysis charges for
certain deposit accounts in light of the core system conversion.
Other charges and fees income increased to $208 thousand in
the fourth quarter of 2024, compared to a loss of
$450 thousand in the prior quarter, primarily related to 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. No comparable valuation
allowance on OREO was recorded in the fourth quarter of 2024.
Noninterest Expense
Total noninterest expense for the fourth quarter
of 2024 was $26.1 million, a decrease of $11.6 million
from total noninterest expense of $37.7 million in the prior
quarter, which was largely due to the decrease in merger related
expenses.
Salaries and employee benefits increased
$689 thousand during the quarter to $16.1 million. The
increase in salaries and employee benefits was primarily related to
the growth in headcount due to the Merger, partially offset by the
third quarter amount including the one-time costs associated with
non-continuing directors, executives and employees of $1.4 million.
Merger and related expenses in connection with the Merger decreased
$14.0 million during the quarter to $643 thousand. Data
processing and communications of $2.0 million in the fourth
quarter of 2024 increased by $424 thousand, due primarily to
increases in transaction volume from both organic growth and the
Merger. Intangible assets amortization of $1.1 million in the
fourth quarter of 2024 increased by $373 thousand, due
primarily to a full quarter of amortization of the core deposit
intangible asset acquired in the Merger, compared with only two
months of amortization of the asset in the prior quarter. Other
expenses of $2.1 million in the fourth quarter of 2024
increased by $443 thousand, due primarily to higher loan
related expenses, customer service related expenses, travel
expenses and insurance expenses.
Efficiency ratio (non-GAAP1) for the fourth
quarter of 2024 was 57.4%, compared to 98.9% in the prior quarter.
Excluding the merger and related expenses of $643 thousand and
$14.6 million, the efficiency ratio (non-GAAP1) for the fourth
and third quarters of 2024 would have been 55.9% and 60.5%,
respectively.
Income Tax
In the fourth quarter of 2024, the Company’s
income tax expense was $6.5 million, compared with a
$6.1 million income tax benefit in the third quarter of 2024.
The effective rate was 27.9% for the fourth quarter of 2024 and
26.9% for the third quarter of 2024. The increase in the effective
tax rate for the fourth quarter of 2024 was primarily attributable
to the impact of the non-tax deductible portion of the merger
expenses and the vesting and exercise of equity awards combined
with changes in the Company's stock price over time, partially
offset by the impact of the tax on the excess executive
compensation.
Balance Sheet
Assets
Total assets at December 31, 2024 were
$4.03 billion, a decrease of $331.1 million or 7.6% from
September 30, 2024. The decrease in total assets from the
prior quarter was primarily related to a decrease in cash and cash
equivalents of $226.3 million and a decrease in loans,
including loans held for sale, of $77.1 million as compared to
the prior quarter. These decreases primarily relate to the
decreases in wholesale funding sources and the Sponsor Finance
portfolio from loan sales and payoffs.
Loans
Total loans held for investment were
$3.14 billion at December 31, 2024, a decrease of
$60.5 million, compared to September 30, 2024, primarily
the result of Sponsor Finance loans sales and loan payoffs in the
amount of $90.8 million. During the fourth quarter of 2024, there
were new originations of $128.5 million and net advances of
$25.6 million, offset by loan sales and payoffs of
$214.5 million, and the partial charge-off of loans in the
amount of $154 thousand. Total loans secured by real estate
decreased by $5.1 million, construction and land development
loans decreased by $20.6 million, commercial real estate and
other loans increased by $11.8 million, 1-4 family residential
loans increased by $11.9 million and multifamily loans
decreased by $8.1 million. Commercial and industrial loans
decreased by $54.5 million, and consumer loans decreased by
$1.0 million. The Company had $17.2 million in loans held
for sale at December 31, 2024, compared to $33.7 million
at September 30, 2024.
Deposits
Total deposits at December 31, 2024 were
$3.40 billion, a decrease of $342.2 million from
September 30, 2024. The decrease primarily consisted of
$111.3 million noninterest-bearing demand deposits,
$73.9 million interest-bearing non-maturity deposits, and
$157.0 million time deposits. Noninterest-bearing demand
deposits at December 31, 2024, were $1.26 billion, or
37.0% of total deposits, compared with $1.37 billion, or 36.6%
of total deposits at September 30, 2024. At December 31,
2024, total interest-bearing deposits were $2.14 billion,
compared to $2.37 billion at September 30, 2024. At
December 31, 2024, total brokered time deposits were
$121.1 million, compared to $222.6 million at
September 30, 2024. The Company offers the Insured Cash Sweep
(ICS) product, Certificate of Deposit Account Registry Service
(CDARS), and Reich & Tang Deposit Solutions (R&T) network,
all of which provide reciprocal deposit placement services to fully
qualified large customer deposits for FDIC insurance among other
participating banks. At December 31, 2024, total reciprocal
deposits were $754.4 million, or 22.2% of total deposits at
December 31, 2024, compared to $839.7 million , or 22.4%
of total deposits at September 30, 2024.
Federal Home Loan Bank ("FHLB") and
Liquidity
At December 31, 2024 and September 30,
2024, the Company had no overnight FHLB borrowings. There were no
outstanding Federal Reserve Discount Window borrowings at
December 31, 2024 or September 30, 2024.
At December 31, 2024, the Company had
available borrowing capacity from an FHLB secured line of credit of
approximately $753.9 million and available borrowing capacity
from the Federal Reserve Discount Window of approximately
$318.5 million. The Company also had available borrowing
capacity from four unsecured credit lines from correspondent banks
of approximately $90.5 million at December 31, 2024, with
no outstanding borrowings. Total available borrowing capacity was
$1.16 billion at December 31, 2024. Additionally, the
Company had unpledged liquid securities at fair value of
approximately $129.4 million and cash and cash equivalents of
$388.2 million at December 31, 2024.
Asset Quality
Total non-performing assets increased slightly
to $30.6 million, or 0.76% of total assets at
December 31, 2024, compared with $29.8 million, or 0.68%
of total assets at September 30, 2024.
There were no loans downgraded to nonaccrual
during the fourth quarter of 2024. Non-performing assets in the
fourth quarter of 2024 included OREO, net of valuation allowance,
of $4.1 million related to a multifamily building, the same
balance as the prior quarter.
Total non-performing loans increased slightly to
$26.5 million, or 0.85% of total loans held for investment at
December 31, 2024, compared with $25.7 million, or 0.80%
of total loans held for investment at September 30, 2024.
Special mention loans decreased by
$24.1 million during the fourth quarter of 2024 to
$69.3 million, including $25.5 million of non-PCD loans and
$10.1 million of purchase credit deteriorated (“PCD”) loans, at
December 31, 2024. The decrease in the special mention loans
was due mostly to a $9.0 million payoff, $24.5 million in
downgrades to substandard accruing loans and $8.4 million in
upgrades to Pass loans, partially offset by $18.1 million in
downgrades from Pass loans. Substandard loans increased by
$13.6 million during the fourth quarter of 2024 to
$117.9 million, including $11.0 million of non-PCD loans,
$55.9 million PCD loans and $14.1 million nonaccrual PCD loans, at
December 31, 2024. The increase in the substandard loans was
due primarily to $29.8 million in downgrades and $2.9 million in
net advances, partially offset by a $17.3 million in payoffs, $1.7
million in upgrades to Pass and $103 thousand in charge-offs.
The Company had $150 thousand in consumer solar
loans that were over 90 days past due and still accruing interest
at December 31, 2024, compared to $37 thousand in such
delinquencies at September 30, 2024.
There were $12.2 million in loan
delinquencies (30-89 days past due, excluding nonaccrual loans) at
December 31, 2024, compared to $19.1 million in such loan
delinquencies at September 30, 2024.
The allowance for credit losses, which is
comprised of the allowance for loan losses ("ALL") and reserve for
unfunded loan commitments, totaled $53.6 million at
December 31, 2024, compared to $57.6 million at
September 30, 2024. The $4.0 million decrease in the
allowance for credit losses included a $2.9 million and
$968 thousand reversal of provision for credit losses for the
loan portfolio and reserve for unfunded loan commitments,
respectively, partially offset by total net charge-offs of
$145 thousand for the quarter ended December 31,
2024.
The ALL was $50.5 million, or 1.61% of
total loans held for investment at December 31, 2024, compared
with $53.6 million, or 1.67% at September 30, 2024.
Capital
Tangible book value (non-GAAP1) per common share
at December 31, 2024, was $11.71, compared with $11.28 at
September 30, 2024. In the fourth quarter of 2024, tangible
book value was primarily impacted by net income of $16.8 million
for the fourth quarter, stock-based compensation expense, and an
increase in net of tax unrealized losses on available-for-sale debt
securities. Other comprehensive losses related to unrealized
losses, net of taxes, on available-for-sale debt securities
increased by $3.8 million to $6.6 million at
December 31, 2024, from $2.9 million at
September 30, 2024. The increase in the unrealized losses, net
of taxes, on available-for-sale debt securities was attributable to
non-credit related factors , including an increase in bond prices
at the long end of the yield curve, even as the Federal Reserve
decreased the Fed funds rate by 25 basis points in December 2024.
Tangible common equity (non-GAAP1) as a percentage of total
tangible assets (non-GAAP1) at December 31, 2024, increased to
9.69% from 8.58% 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 December 31, 2024
increased to 1.8% from 0.8% in the prior quarter.
The Company’s preliminary capital exceeds
minimums required to be “well-capitalized” at December 31,
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 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; thecosts 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 Year Ended |
|
| |
|
December 31,2024 |
|
|
September 30,2024 |
|
|
December 31,2023 |
|
|
December 31,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands except share and per share data) |
|
| EARNINGS |
|
|
|
|
Net interest income |
|
$ |
44,541 |
|
|
$ |
36,942 |
|
|
$ |
22,559 |
|
|
$ |
122,984 |
|
|
$ |
94,138 |
|
|
(Reversal of) provision for credit losses |
|
$ |
(3,835 |
) |
|
$ |
22,963 |
|
|
$ |
824 |
|
|
$ |
21,690 |
|
|
$ |
915 |
|
|
Noninterest income (expense) |
|
$ |
1,004 |
|
|
$ |
1,174 |
|
|
$ |
(102 |
) |
|
$ |
4,760 |
|
|
$ |
3,379 |
|
|
Noninterest expense |
|
$ |
26,125 |
|
|
$ |
37,680 |
|
|
$ |
15,339 |
|
|
$ |
97,791 |
|
|
$ |
59,746 |
|
|
Income tax expense (benefit) |
|
$ |
6,483 |
|
|
$ |
(6,063 |
) |
|
$ |
1,882 |
|
|
$ |
2,830 |
|
|
$ |
10,946 |
|
|
Net income (loss) |
|
$ |
16,772 |
|
|
$ |
(16,464 |
) |
|
$ |
4,412 |
|
|
$ |
5,433 |
|
|
$ |
25,910 |
|
|
Pre-tax pre-provision income (1) |
|
$ |
19,420 |
|
|
$ |
436 |
|
|
$ |
7,118 |
|
|
$ |
29,953 |
|
|
$ |
37,771 |
|
|
Adjusted pre-tax pre-provision income (1) |
|
$ |
20,063 |
|
|
$ |
15,041 |
|
|
$ |
7,118 |
|
|
$ |
46,241 |
|
|
$ |
37,771 |
|
|
Diluted earnings (loss) per share |
|
$ |
0.51 |
|
|
$ |
(0.59 |
) |
|
$ |
0.24 |
|
|
$ |
0.22 |
|
|
$ |
1.39 |
|
|
Shares outstanding at period end |
|
|
32,265,935 |
|
|
|
32,142,427 |
|
|
|
18,369,115 |
|
|
|
32,265,935 |
|
|
|
18,369,115 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| PERFORMANCE
RATIOS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets |
|
|
1.60 |
% |
|
|
(1.82 |
)% |
|
|
0.75 |
% |
|
|
0.18 |
% |
|
|
1.12 |
% |
|
Adjusted return on average assets (1) |
|
|
1.64 |
% |
|
|
1.01 |
% |
|
|
0.75 |
% |
|
|
1.05 |
% |
|
|
1.12 |
% |
|
Return on average common equity |
|
|
13.21 |
% |
|
|
(15.28 |
)% |
|
|
6.21 |
% |
|
|
1.43 |
% |
|
|
9.48 |
% |
|
Adjusted return on average common equity (1) |
|
|
13.57 |
% |
|
|
8.44 |
% |
|
|
6.21 |
% |
|
|
8.53 |
% |
|
|
9.48 |
% |
|
Yield on total loans |
|
|
6.84 |
% |
|
|
6.79 |
% |
|
|
6.08 |
% |
|
|
6.55 |
% |
|
|
5.94 |
% |
|
Yield on interest earning assets |
|
|
6.48 |
% |
|
|
6.49 |
% |
|
|
5.85 |
% |
|
|
6.26 |
% |
|
|
5.69 |
% |
|
Cost of deposits |
|
|
1.87 |
% |
|
|
2.09 |
% |
|
|
1.81 |
% |
|
|
2.01 |
% |
|
|
1.37 |
% |
|
Cost of funds |
|
|
1.99 |
% |
|
|
2.19 |
% |
|
|
1.95 |
% |
|
|
2.12 |
% |
|
|
1.46 |
% |
|
Net interest margin |
|
|
4.61 |
% |
|
|
4.43 |
% |
|
|
4.05 |
% |
|
|
4.28 |
% |
|
|
4.33 |
% |
|
Efficiency ratio (1) |
|
|
57.36 |
% |
|
|
98.86 |
% |
|
|
68.30 |
% |
|
|
76.55 |
% |
|
|
61.27 |
% |
|
Adjusted efficiency ratio (1) |
|
|
55.95 |
% |
|
|
60.54 |
% |
|
|
68.30 |
% |
|
|
63.80 |
% |
|
|
61.27 |
% |
| |
|
As of |
|
| |
|
December 31,2024 |
|
|
September 30,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands except share and per share data) |
|
| CAPITAL |
|
|
|
|
Tangible equity to tangible assets (1) |
|
|
9.69 |
% |
|
|
8.58 |
% |
|
|
10.73 |
% |
|
Book value (BV) per common share |
|
$ |
15.86 |
|
|
$ |
15.50 |
|
|
$ |
15.69 |
|
|
Tangible BV per common share (1) |
|
$ |
11.71 |
|
|
$ |
11.28 |
|
|
$ |
13.56 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| ASSET
QUALITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses (ALL) |
|
$ |
50,540 |
|
|
$ |
53,552 |
|
|
$ |
22,569 |
|
|
Reserve for unfunded loan commitments |
|
$ |
3,103 |
|
|
$ |
4,071 |
|
|
$ |
933 |
|
|
Allowance for credit losses (ACL) |
|
$ |
53,643 |
|
|
$ |
57,623 |
|
|
$ |
23,502 |
|
|
Allowance for loan losses to nonperforming loans |
|
|
1.90 |
x |
|
|
2.08 |
x |
|
|
1.74 |
x |
|
ALL to total loans held for investment |
|
|
1.61 |
% |
|
|
1.67 |
% |
|
|
1.15 |
% |
|
ACL to total loans held for investment |
|
|
1.71 |
% |
|
|
1.80 |
% |
|
|
1.20 |
% |
|
30-89 days past due, excluding nonaccrual loans |
|
$ |
12,232 |
|
|
$ |
19,110 |
|
|
$ |
19 |
|
|
Over 90 days past due, excluding nonaccrual loans |
|
$ |
150 |
|
|
$ |
37 |
|
|
$ |
— |
|
|
Special mention loans |
|
$ |
69,339 |
|
|
$ |
93,448 |
|
|
$ |
2,996 |
|
|
Special mention loans to total loans held for investment |
|
|
2.21 |
% |
|
|
2.92 |
% |
|
|
0.15 |
% |
|
Substandard loans |
|
$ |
117,926 |
|
|
$ |
104,298 |
|
|
$ |
19,502 |
|
|
Substandard loans to total loans held for investment |
|
|
3.76 |
% |
|
|
3.26 |
% |
|
|
1.00 |
% |
|
Nonperforming loans |
|
$ |
26,536 |
|
|
$ |
25,698 |
|
|
$ |
13,004 |
|
|
Nonperforming loans to total loans held for investment |
|
|
0.85 |
% |
|
|
0.80 |
% |
|
|
0.66 |
% |
|
Other real estate owned, net |
|
$ |
4,083 |
|
|
$ |
4,083 |
|
|
$ |
— |
|
|
Nonperforming assets |
|
$ |
30,619 |
|
|
$ |
29,781 |
|
|
$ |
13,004 |
|
|
Nonperforming assets to total assets |
|
|
0.76 |
% |
|
|
0.68 |
% |
|
|
0.55 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| END OF PERIOD
BALANCES |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans, including loans held for sale |
|
$ |
3,156,345 |
|
|
$ |
3,233,418 |
|
|
$ |
1,964,791 |
|
|
Total assets |
|
$ |
4,031,654 |
|
|
$ |
4,362,767 |
|
|
$ |
2,360,252 |
|
|
Deposits |
|
$ |
3,398,760 |
|
|
$ |
3,740,915 |
|
|
$ |
1,943,556 |
|
|
Loans to deposits |
|
|
92.9 |
% |
|
|
86.4 |
% |
|
|
101.1 |
% |
|
Shareholders’ equity |
|
$ |
511,836 |
|
|
$ |
498,064 |
|
|
$ |
288,152 |
|
|
(1 |
) |
Non-GAAP measure. See – GAAP to
Non-GAAP reconciliation. |
California BanCorp and
SubsidiaryFinancial Highlights (Unaudited)
| |
|
At or for the Three Months
Ended |
|
|
At or for the Year Ended |
|
| ALLOWANCE for CREDIT
LOSSES |
|
December 31,2024 |
|
|
September 30,2024 |
|
|
December 31,2023 |
|
|
December 31,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands) |
|
| Allowance for loan
losses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance at beginning of
period |
|
$ |
53,552 |
|
|
$ |
23,788 |
|
|
$ |
22,705 |
|
|
$ |
22,569 |
|
|
$ |
17,099 |
|
| Adoption of ASU 2016-13
(1) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,027 |
|
| Initial Allowance for PCD
loans |
|
|
— |
|
|
|
11,216 |
|
|
|
— |
|
|
|
11,216 |
|
|
|
— |
|
| (Reversal of) provision for
credit losses (2) |
|
|
(2,867 |
) |
|
|
19,711 |
|
|
|
1,131 |
|
|
|
19,520 |
|
|
|
1,731 |
|
| Charge-offs |
|
|
(154 |
) |
|
|
(1,163 |
) |
|
|
(1,267 |
) |
|
|
(2,774 |
) |
|
|
(1,303 |
) |
| Recoveries |
|
|
9 |
|
|
|
— |
|
|
|
— |
|
|
|
9 |
|
|
|
15 |
|
| Net charge-offs |
|
|
(145 |
) |
|
|
(1,163 |
) |
|
|
(1,267 |
) |
|
|
(2,765 |
) |
|
|
(1,288 |
) |
| Balance, end of period |
|
$ |
50,540 |
|
|
$ |
53,552 |
|
|
$ |
22,569 |
|
|
$ |
50,540 |
|
|
$ |
22,569 |
|
| Reserve for unfunded
loan commitments (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, beginning of
period |
|
$ |
4,071 |
|
|
$ |
819 |
|
|
$ |
1,240 |
|
|
$ |
933 |
|
|
$ |
1,310 |
|
| Adoption of ASU 2016-13
(1) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
439 |
|
| (Reversal of) provision for
credit losses (4) |
|
|
(968 |
) |
|
|
3,252 |
|
|
|
(307 |
) |
|
|
2,170 |
|
|
|
(816 |
) |
| Balance, end of period |
|
|
3,103 |
|
|
|
4,071 |
|
|
|
933 |
|
|
|
3,103 |
|
|
|
933 |
|
| Allowance for credit
losses |
|
$ |
53,643 |
|
|
$ |
57,623 |
|
|
$ |
23,502 |
|
|
$ |
53,643 |
|
|
$ |
23,502 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ALL to total loans held for
investment |
|
|
1.61 |
% |
|
|
1.67 |
% |
|
|
1.15 |
% |
|
|
1.61 |
% |
|
|
1.15 |
% |
| ACL to total loans held for
investment |
|
|
1.71 |
% |
|
|
1.80 |
% |
|
|
1.20 |
% |
|
|
1.71 |
% |
|
|
1.20 |
% |
| Net charge-offs to average
total loans |
|
|
(0.02 |
)% |
|
|
(0.17 |
)% |
|
|
(0.26 |
)% |
|
|
(0.11 |
)% |
|
|
(0.07 |
)% |
|
(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 months ended September 30,
2024 and year ended December 31, 2024 related to the initial
provision for credit losses for non-PCD loans acquired in the
Merger. |
|
(3 |
) |
Included in “Accrued interest and other liabilities” on the
consolidated balance sheet. |
|
(4 |
) |
Includes $2.7 million for the three months ended September 30, 2024
and year ended December 31, 2024 related to the initial provision
for credit losses on unfunded commitments acquired in the
Merger. |
California BanCorp and
SubsidiaryBalance Sheets (Unaudited)
| |
|
December 31,2024 |
|
|
September 30,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands) |
|
| ASSETS |
|
|
|
|
|
|
|
|
|
| Cash and due from banks |
|
$ |
60,471 |
|
|
$ |
115,165 |
|
|
$ |
33,008 |
|
| Federal funds sold &
interest-bearing balances |
|
|
327,691 |
|
|
|
499,258 |
|
|
|
53,785 |
|
|
Total cash and cash equivalents |
|
|
388,162 |
|
|
|
614,423 |
|
|
|
86,793 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Debt securities
available-for-sale, at fair value (amortized cost of $151,429,
$163,384 and $136,366 at December 31, 2024, September 30,
2024 and December 31, 2023) |
|
|
142,001 |
|
|
|
159,330 |
|
|
|
130,035 |
|
| Debt securities
held-to-maturity, at cost (fair value of $47,823, $49,487 and
$50,432 at December 31, 2024, September 30, 2024 and
December 31, 2023) |
|
|
53,280 |
|
|
|
53,364 |
|
|
|
53,616 |
|
| Loans held for sale |
|
|
17,180 |
|
|
|
33,704 |
|
|
|
7,349 |
|
| Loans held for
investment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction & land development |
|
|
227,325 |
|
|
|
247,934 |
|
|
|
243,521 |
|
|
1-4 family residential |
|
|
164,401 |
|
|
|
152,540 |
|
|
|
143,903 |
|
|
Multifamily |
|
|
243,993 |
|
|
|
252,134 |
|
|
|
221,247 |
|
|
Other commercial real estate |
|
|
1,767,727 |
|
|
|
1,755,908 |
|
|
|
1,024,243 |
|
|
Commercial & industrial |
|
|
710,970 |
|
|
|
765,472 |
|
|
|
320,142 |
|
|
Other consumer |
|
|
24,749 |
|
|
|
25,726 |
|
|
|
4,386 |
|
|
Total loans held for investment |
|
|
3,139,165 |
|
|
|
3,199,714 |
|
|
|
1,957,442 |
|
| Allowance for credit losses -
loans |
|
|
(50,540 |
) |
|
|
(53,552 |
) |
|
|
(22,569 |
) |
|
Total loans held for investment, net |
|
|
3,088,625 |
|
|
|
3,146,162 |
|
|
|
1,934,873 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Restricted stock at cost |
|
|
30,829 |
|
|
|
27,394 |
|
|
|
16,055 |
|
| Premises and equipment |
|
|
13,595 |
|
|
|
13,996 |
|
|
|
13,270 |
|
| Right of use asset |
|
|
14,350 |
|
|
|
15,310 |
|
|
|
9,291 |
|
| Other real estate owned,
net |
|
|
4,083 |
|
|
|
4,083 |
|
|
|
— |
|
| Goodwill |
|
|
111,787 |
|
|
|
112,515 |
|
|
|
37,803 |
|
| Intangible assets |
|
|
22,271 |
|
|
|
23,031 |
|
|
|
1,195 |
|
| Bank owned life insurance |
|
|
66,636 |
|
|
|
66,180 |
|
|
|
38,918 |
|
| Deferred taxes, net |
|
|
43,127 |
|
|
|
45,644 |
|
|
|
11,137 |
|
| Accrued interest and other
assets |
|
|
35,728 |
|
|
|
47,631 |
|
|
|
19,917 |
|
|
Total assets |
|
$ |
4,031,654 |
|
|
$ |
4,362,767 |
|
|
$ |
2,360,252 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
| Deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing demand |
|
$ |
1,257,007 |
|
|
$ |
1,368,303 |
|
|
$ |
675,098 |
|
|
Interest-bearing NOW accounts |
|
|
673,589 |
|
|
|
781,125 |
|
|
|
381,943 |
|
|
Money market and savings accounts |
|
|
1,182,927 |
|
|
|
1,149,268 |
|
|
|
636,685 |
|
|
Time deposits |
|
|
285,237 |
|
|
|
442,219 |
|
|
|
249,830 |
|
| Total deposits |
|
|
3,398,760 |
|
|
|
3,740,915 |
|
|
|
1,943,556 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Borrowings |
|
|
69,725 |
|
|
|
69,142 |
|
|
|
102,865 |
|
| Operating lease liability |
|
|
18,310 |
|
|
|
19,211 |
|
|
|
12,117 |
|
| Accrued interest and other
liabilities |
|
|
33,023 |
|
|
|
35,435 |
|
|
|
13,562 |
|
|
Total liabilities |
|
|
3,519,818 |
|
|
|
3,864,703 |
|
|
|
2,072,100 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Shareholders’
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
| Common stock - 50,000,000
shares authorized, no par value; issued and outstanding 32,265,935,
32,142,427 and 18,369,115 at December 31, 2024, September 30,
2024 and December 31, 2023) |
|
|
442,469 |
|
|
|
441,684 |
|
|
|
222,036 |
|
| Retained earnings |
|
|
76,008 |
|
|
|
59,236 |
|
|
|
70,575 |
|
| Accumulated other
comprehensive loss - net of taxes |
|
|
(6,641 |
) |
|
|
(2,856 |
) |
|
|
(4,459 |
) |
|
Total shareholders’ equity |
|
|
511,836 |
|
|
|
498,064 |
|
|
|
288,152 |
|
|
Total liabilities and shareholders’ equity |
|
$ |
4,031,654 |
|
|
$ |
4,362,767 |
|
|
$ |
2,360,252 |
|
California BanCorp and
SubsidiaryIncome Statements - Quarterly and Year-to-Date
(Unaudited)
| |
|
Three Months Ended |
|
|
Year Ended |
|
| |
|
December 31,2024 |
|
|
September 30,2024 |
|
|
December 31,2023 |
|
|
December 31,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands except share and per share data) |
|
| INTEREST AND DIVIDEND
INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest and fees on
loans |
|
$ |
54,791 |
|
|
$ |
47,528 |
|
|
$ |
29,968 |
|
|
$ |
159,960 |
|
|
$ |
113,951 |
|
| Interest on debt
securities |
|
|
1,698 |
|
|
|
1,687 |
|
|
|
991 |
|
|
|
5,827 |
|
|
|
3,497 |
|
| Interest on tax-exempted debt
securities |
|
|
305 |
|
|
|
306 |
|
|
|
353 |
|
|
|
1,223 |
|
|
|
1,655 |
|
| Interest and dividends from
other institutions |
|
|
5,764 |
|
|
|
4,606 |
|
|
|
1,257 |
|
|
|
12,788 |
|
|
|
4,419 |
|
|
Total interest and dividend income |
|
|
62,558 |
|
|
|
54,127 |
|
|
|
32,569 |
|
|
|
179,798 |
|
|
|
123,522 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| INTEREST
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest on NOW, savings, and
money market accounts |
|
|
12,447 |
|
|
|
11,073 |
|
|
|
6,606 |
|
|
|
37,329 |
|
|
|
20,161 |
|
| Interest on time deposits |
|
|
4,179 |
|
|
|
5,087 |
|
|
|
2,331 |
|
|
|
15,432 |
|
|
|
6,704 |
|
| Interest on borrowings |
|
|
1,391 |
|
|
|
1,025 |
|
|
|
1,073 |
|
|
|
4,053 |
|
|
|
2,519 |
|
|
Total interest expense |
|
|
18,017 |
|
|
|
17,185 |
|
|
|
10,010 |
|
|
|
56,814 |
|
|
|
29,384 |
|
|
Net interest income |
|
|
44,541 |
|
|
|
36,942 |
|
|
|
22,559 |
|
|
|
122,984 |
|
|
|
94,138 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (Reversal of) provisions for
credit losses (1) |
|
|
(3,835 |
) |
|
|
22,963 |
|
|
|
824 |
|
|
|
21,690 |
|
|
|
915 |
|
|
Net interest income after (reversal of) provision for credit
losses |
|
|
48,376 |
|
|
|
13,979 |
|
|
|
21,735 |
|
|
|
101,294 |
|
|
|
93,223 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NONINTEREST
INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Service charges and fees on
deposit accounts |
|
|
911 |
|
|
|
1,136 |
|
|
|
507 |
|
|
|
3,140 |
|
|
|
1,946 |
|
| (Loss) gain on sale of
loans |
|
|
(1,095 |
) |
|
|
8 |
|
|
|
— |
|
|
|
(672 |
) |
|
|
831 |
|
| Bank owned life insurance
income |
|
|
823 |
|
|
|
398 |
|
|
|
253 |
|
|
|
1,748 |
|
|
|
946 |
|
| Servicing and related income
on loans |
|
|
157 |
|
|
|
82 |
|
|
|
17 |
|
|
|
307 |
|
|
|
240 |
|
| Loss on sale of debt
securities |
|
|
— |
|
|
|
— |
|
|
|
(1,008 |
) |
|
|
— |
|
|
|
(974 |
) |
| Loss on sale of building and
related fixed assets |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(19 |
) |
|
|
— |
|
| Other charges and fees |
|
|
208 |
|
|
|
(450 |
) |
|
|
129 |
|
|
|
256 |
|
|
|
390 |
|
|
Total noninterest income (expense) |
|
|
1,004 |
|
|
|
1,174 |
|
|
|
(102 |
) |
|
|
4,760 |
|
|
|
3,379 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NONINTEREST
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Salaries and employee
benefits |
|
|
16,074 |
|
|
|
15,385 |
|
|
|
9,598 |
|
|
|
49,845 |
|
|
|
39,249 |
|
| Occupancy and equipment
expenses |
|
|
2,314 |
|
|
|
2,031 |
|
|
|
1,678 |
|
|
|
7,242 |
|
|
|
6,231 |
|
| Data processing |
|
|
1,960 |
|
|
|
1,536 |
|
|
|
1,158 |
|
|
|
5,832 |
|
|
|
4,534 |
|
| Legal, audit and
professional |
|
|
817 |
|
|
|
669 |
|
|
|
1,161 |
|
|
|
2,559 |
|
|
|
3,211 |
|
| Regulatory assessments |
|
|
436 |
|
|
|
544 |
|
|
|
320 |
|
|
|
1,714 |
|
|
|
1,508 |
|
| Director and shareholder
expenses |
|
|
458 |
|
|
|
520 |
|
|
|
207 |
|
|
|
1,410 |
|
|
|
849 |
|
| Merger and related
expenses |
|
|
643 |
|
|
|
14,605 |
|
|
|
— |
|
|
|
16,288 |
|
|
|
— |
|
| Intangible assets
amortization |
|
|
1,060 |
|
|
|
687 |
|
|
|
80 |
|
|
|
1,877 |
|
|
|
389 |
|
| Other real estate owned
expense |
|
|
220 |
|
|
|
3 |
|
|
|
— |
|
|
|
5,246 |
|
|
|
— |
|
| Other expense |
|
|
2,143 |
|
|
|
1,700 |
|
|
|
1,137 |
|
|
|
5,778 |
|
|
|
3,775 |
|
|
Total noninterest expense |
|
|
26,125 |
|
|
|
37,680 |
|
|
|
15,339 |
|
|
|
97,791 |
|
|
|
59,746 |
|
|
Income (loss) before income taxes |
|
|
23,255 |
|
|
|
(22,527 |
) |
|
|
6,294 |
|
|
|
8,263 |
|
|
|
36,856 |
|
| Income tax expense
(benefit) |
|
|
6,483 |
|
|
|
(6,063 |
) |
|
|
1,882 |
|
|
|
2,830 |
|
|
|
10,946 |
|
|
Net income (loss) |
|
$ |
16,772 |
|
|
$ |
(16,464 |
) |
|
$ |
4,412 |
|
|
$ |
5,433 |
|
|
$ |
25,910 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) per share -
basic |
|
$ |
0.52 |
|
|
$ |
(0.59 |
) |
|
$ |
0.24 |
|
|
$ |
0.22 |
|
|
$ |
1.42 |
|
| Net income (loss) per share -
diluted |
|
$ |
0.51 |
|
|
$ |
(0.59 |
) |
|
$ |
0.24 |
|
|
$ |
0.22 |
|
|
$ |
1.39 |
|
| Weighted average common
shares-diluted |
|
|
32,698,714 |
|
|
|
27,705,844 |
|
|
|
18,727,519 |
|
|
|
24,623,397 |
|
|
|
18,656,742 |
|
| Pre-tax, pre-provision income
(2) |
|
$ |
19,420 |
|
|
$ |
436 |
|
|
$ |
7,118 |
|
|
$ |
29,953 |
|
|
$ |
37,771 |
|
|
(1 |
) |
Included (reversal of) provision for unfunded loan commitments of
$(1.0) million, $3.3 million and $(307) thousand for the three
months ended December 31, 2024, September 30, 2024 and December 31,
2023, respectively, and $2.2 million and $(816) thousand for the
years ended December 31, 2024 and 2023, respectively |
|
(2 |
) |
Non-GAAP measure. See – GAAP to Non-GAAP reconciliation. |
California BanCorp and
SubsidiaryAverage Balance Sheets and Yield
Analysis(Unaudited)
| |
|
Three Months Ended |
|
| |
|
December 31, 2024 |
|
|
September 30, 2024 |
|
|
December 31, 2023 |
|
| |
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
| |
|
($ in thousands) |
|
| Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total loans |
|
$ |
3,184,918 |
|
|
$ |
54,791 |
|
|
|
6.84 |
|
% |
|
$ |
2,783,581 |
|
|
$ |
47,528 |
|
|
|
6.79 |
% |
|
$ |
1,954,396 |
|
|
$ |
29,968 |
|
|
|
6.08 |
% |
| Taxable debt securities |
|
|
147,895 |
|
|
|
1,698 |
|
|
|
4.57 |
|
% |
|
|
149,080 |
|
|
|
1,687 |
|
|
|
4.50 |
% |
|
|
113,375 |
|
|
|
991 |
|
|
|
3.47 |
% |
| Tax-exempt debt securities
(1) |
|
|
53,607 |
|
|
|
305 |
|
|
|
2.87 |
|
% |
|
|
53,682 |
|
|
|
306 |
|
|
|
2.87 |
% |
|
|
58,644 |
|
|
|
353 |
|
|
|
3.02 |
% |
| Deposits in other financial
institutions |
|
|
422,032 |
|
|
|
5,123 |
|
|
|
4.83 |
|
% |
|
|
161,616 |
|
|
|
2,215 |
|
|
|
5.45 |
% |
|
|
56,313 |
|
|
|
759 |
|
|
|
5.35 |
% |
| Fed funds sold/resale
agreements |
|
|
3,353 |
|
|
|
38 |
|
|
|
4.51 |
|
% |
|
|
143,140 |
|
|
|
1,886 |
|
|
|
5.24 |
% |
|
|
9,008 |
|
|
|
125 |
|
|
|
5.51 |
% |
| Restricted stock investments
and other bank stock |
|
|
30,341 |
|
|
|
603 |
|
|
|
7.91 |
|
% |
|
|
24,587 |
|
|
|
505 |
|
|
|
8.17 |
% |
|
|
16,394 |
|
|
|
373 |
|
|
|
9.03 |
% |
|
Total interest-earning assets |
|
|
3,842,146 |
|
|
|
62,558 |
|
|
|
6.48 |
|
% |
|
|
3,315,686 |
|
|
|
54,127 |
|
|
|
6.49 |
% |
|
|
2,208,130 |
|
|
|
32,569 |
|
|
|
5.85 |
% |
| Total noninterest-earning
assets |
|
|
326,601 |
|
|
|
|
|
|
|
|
|
|
|
277,471 |
|
|
|
|
|
|
|
|
|
|
|
137,193 |
|
|
|
|
|
|
|
|
|
| Total
assets |
|
$ |
4,168,747 |
|
|
|
|
|
|
|
|
|
|
$ |
3,593,157 |
|
|
|
|
|
|
|
|
|
|
$ |
2,345,323 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing NOW
accounts |
|
$ |
704,017 |
|
|
$ |
3,784 |
|
|
|
2.14 |
|
% |
|
$ |
617,373 |
|
|
$ |
2,681 |
|
|
|
1.73 |
% |
|
$ |
362,579 |
|
|
$ |
1,860 |
|
|
|
2.04 |
% |
| Money market and savings
accounts |
|
|
1,192,692 |
|
|
|
8,663 |
|
|
|
2.89 |
|
% |
|
|
999,322 |
|
|
|
8,392 |
|
|
|
3.34 |
% |
|
|
669,391 |
|
|
|
4,746 |
|
|
|
2.81 |
% |
| Time deposits |
|
|
359,111 |
|
|
|
4,179 |
|
|
|
4.63 |
|
% |
|
|
421,241 |
|
|
|
5,087 |
|
|
|
4.80 |
% |
|
|
208,700 |
|
|
|
2,331 |
|
|
|
4.43 |
% |
|
Total interest-bearing deposits |
|
|
2,255,820 |
|
|
|
16,626 |
|
|
|
2.93 |
|
% |
|
|
2,037,936 |
|
|
|
16,160 |
|
|
|
3.15 |
% |
|
|
1,240,670 |
|
|
|
8,937 |
|
|
|
2.86 |
% |
| Borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| FHLB advances |
|
|
— |
|
|
|
— |
|
|
|
— |
% |
|
|
|
611 |
|
|
|
9 |
|
|
|
5.86 |
% |
|
|
56,380 |
|
|
|
802 |
|
|
|
5.64 |
% |
| Subordinated debt |
|
|
69,420 |
|
|
|
1,391 |
|
|
|
7.97 |
|
% |
|
|
52,246 |
|
|
|
1,016 |
|
|
|
7.74 |
% |
|
|
17,854 |
|
|
|
271 |
|
|
|
6.02 |
% |
|
Total borrowings |
|
|
69,420 |
|
|
|
1,391 |
|
|
|
7.97 |
|
% |
|
|
52,857 |
|
|
|
1,025 |
|
|
|
7.71 |
% |
|
|
74,234 |
|
|
|
1,073 |
|
|
|
5.73 |
% |
| Total interest-bearing
liabilities |
|
|
2,325,240 |
|
|
|
18,017 |
|
|
|
3.08 |
|
% |
|
|
2,090,793 |
|
|
|
17,185 |
|
|
|
3.27 |
% |
|
|
1,314,904 |
|
|
|
10,010 |
|
|
|
3.02 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing deposits
(2) |
|
|
1,283,591 |
|
|
|
|
|
|
|
|
|
|
|
1,031,844 |
|
|
|
|
|
|
|
|
|
|
|
721,169 |
|
|
|
|
|
|
|
|
|
| Other liabilities |
|
|
55,007 |
|
|
|
|
|
|
|
|
|
|
|
41,962 |
|
|
|
|
|
|
|
|
|
|
|
27,178 |
|
|
|
|
|
|
|
|
|
| Shareholders’ equity |
|
|
504,909 |
|
|
|
|
|
|
|
|
|
|
|
428,558 |
|
|
|
|
|
|
|
|
|
|
|
282,072 |
|
|
|
|
|
|
|
|
|
| Total Liabilities and
Shareholders’ Equity |
|
$ |
4,168,747 |
|
|
|
|
|
|
|
|
|
|
$ |
3,593,157 |
|
|
|
|
|
|
|
|
|
|
$ |
2,345,323 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest spread |
|
|
|
|
|
|
|
|
|
|
3.40 |
|
% |
|
|
|
|
|
|
|
|
|
|
3.22 |
% |
|
|
|
|
|
|
|
|
|
|
2.83 |
% |
| Net interest income
and margin |
|
|
|
|
|
$ |
44,541 |
|
|
|
4.61 |
|
% |
|
|
|
|
|
$ |
36,942 |
|
|
|
4.43 |
% |
|
|
|
|
|
$ |
22,559 |
|
|
|
4.05 |
% |
| Cost of deposits |
|
$ |
3,539,411 |
|
|
$ |
16,626 |
|
|
|
1.87 |
|
% |
|
$ |
3,069,780 |
|
|
$ |
16,160 |
|
|
|
2.09 |
% |
|
$ |
1,961,839 |
|
|
$ |
8,937 |
|
|
|
1.81 |
% |
| Cost of funds |
|
$ |
3,608,831 |
|
|
$ |
18,017 |
|
|
|
1.99 |
|
% |
|
$ |
3,122,637 |
|
|
$ |
17,185 |
|
|
|
2.19 |
% |
|
$ |
2,036,073 |
|
|
$ |
10,010 |
|
|
|
1.95 |
% |
|
(1 |
) |
Tax-exempt debt securities yields are presented on a tax equivalent
basis using a 21% tax rate. |
|
(2 |
) |
Average noninterest-bearing deposits represent 36.27%, 33.61% and
36.76% of average total deposits for the three months ended
December 31, 2024, September 30, 2024 and December 31, 2023,
respectively. |
California BanCorp and
SubsidiaryAverage Balance Sheets and Yield
Analysis(Unaudited)
| |
|
Year Ended |
|
| |
|
December 31, 2024 |
|
|
December 31, 2023 |
|
| |
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
|
Average Balance |
|
|
Income/Expense |
|
|
Yield/Cost |
|
| |
|
($ in thousands) |
|
| Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total loans |
|
$ |
2,443,127 |
|
|
$ |
159,960 |
|
|
|
6.55 |
% |
|
$ |
1,918,443 |
|
|
$ |
113,951 |
|
|
|
5.94 |
% |
| Taxable debt securities |
|
|
136,984 |
|
|
|
5,827 |
|
|
|
4.25 |
% |
|
|
107,021 |
|
|
|
3,497 |
|
|
|
3.27 |
% |
| Tax-exempt debt securities
(1) |
|
|
53,721 |
|
|
|
1,223 |
|
|
|
2.88 |
% |
|
|
65,674 |
|
|
|
1,655 |
|
|
|
3.19 |
% |
| Deposits in other financial
institutions |
|
|
171,939 |
|
|
|
8,692 |
|
|
|
5.06 |
% |
|
|
46,826 |
|
|
|
2,434 |
|
|
|
5.20 |
% |
| Fed funds sold/resale
agreements |
|
|
43,990 |
|
|
|
2,319 |
|
|
|
5.27 |
% |
|
|
18,114 |
|
|
|
923 |
|
|
|
5.10 |
% |
| Restricted stock investments
and other bank stock |
|
|
22,137 |
|
|
|
1,777 |
|
|
|
8.03 |
% |
|
|
15,930 |
|
|
|
1,062 |
|
|
|
6.67 |
% |
|
Total interest-earning assets |
|
|
2,871,898 |
|
|
|
179,798 |
|
|
|
6.26 |
% |
|
|
2,172,008 |
|
|
|
123,522 |
|
|
|
5.69 |
% |
| Total noninterest-earning
assets |
|
|
224,018 |
|
|
|
|
|
|
|
|
|
|
|
134,225 |
|
|
|
|
|
|
|
|
|
| Total
assets |
|
$ |
3,095,916 |
|
|
|
|
|
|
|
|
|
|
$ |
2,306,233 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing NOW
accounts |
|
$ |
511,425 |
|
|
$ |
10,644 |
|
|
|
2.08 |
% |
|
$ |
308,537 |
|
|
$ |
5,161 |
|
|
|
1.67 |
% |
| Money market and savings
accounts |
|
|
911,684 |
|
|
|
26,685 |
|
|
|
2.93 |
% |
|
|
673,176 |
|
|
|
15,000 |
|
|
|
2.23 |
% |
| Time deposits |
|
|
324,249 |
|
|
|
15,432 |
|
|
|
4.76 |
% |
|
|
180,219 |
|
|
|
6,704 |
|
|
|
3.72 |
% |
|
Total interest-bearing deposits |
|
|
1,747,358 |
|
|
|
52,761 |
|
|
|
3.02 |
% |
|
|
1,161,932 |
|
|
|
26,865 |
|
|
|
2.31 |
% |
| Borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| FHLB advances |
|
|
19,543 |
|
|
|
1,103 |
|
|
|
5.64 |
% |
|
|
26,390 |
|
|
|
1,434 |
|
|
|
5.43 |
% |
| Subordinated debt |
|
|
39,479 |
|
|
|
2,950 |
|
|
|
7.47 |
% |
|
|
17,818 |
|
|
|
1,085 |
|
|
|
6.09 |
% |
|
Total borrowings |
|
|
59,022 |
|
|
|
4,053 |
|
|
|
6.87 |
% |
|
|
44,208 |
|
|
|
2,519 |
|
|
|
5.70 |
% |
| Total interest-bearing
liabilities |
|
|
1,806,380 |
|
|
|
56,814 |
|
|
|
3.15 |
% |
|
|
1,206,140 |
|
|
|
29,384 |
|
|
|
2.44 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest-bearing deposits
(2) |
|
|
873,043 |
|
|
|
|
|
|
|
|
|
|
|
801,882 |
|
|
|
|
|
|
|
|
|
| Other liabilities |
|
|
36,677 |
|
|
|
|
|
|
|
|
|
|
|
24,865 |
|
|
|
|
|
|
|
|
|
| Shareholders’ equity |
|
|
379,816 |
|
|
|
|
|
|
|
|
|
|
|
273,346 |
|
|
|
|
|
|
|
|
|
| Total Liabilities and
Shareholders’ Equity |
|
$ |
3,095,916 |
|
|
|
|
|
|
|
|
|
|
$ |
2,306,233 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest spread |
|
|
|
|
|
|
|
|
|
|
3.11 |
% |
|
|
|
|
|
|
|
|
|
|
3.25 |
% |
| Net interest income
and margin |
|
|
|
|
|
$ |
122,984 |
|
|
|
4.28 |
% |
|
|
|
|
|
$ |
94,138 |
|
|
|
4.33 |
% |
| Cost of deposits |
|
$ |
2,620,401 |
|
|
$ |
52,761 |
|
|
|
2.01 |
% |
|
$ |
1,963,814 |
|
|
$ |
26,865 |
|
|
|
1.37 |
% |
| Cost of funds |
|
$ |
2,679,423 |
|
|
$ |
56,814 |
|
|
|
2.12 |
% |
|
$ |
2,008,022 |
|
|
$ |
29,384 |
|
|
|
1.46 |
% |
|
(1 |
) |
Tax-exempt debt securities yields are presented on a tax equivalent
basis using a 21% tax rate. |
|
(2 |
) |
Average noninterest-bearing deposits represent 33.32%, and 40.83%
of average total deposits for the year ended December 31, 2024 and
December 31, 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
income (loss), (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 |
|
|
Year Ended |
|
| |
|
December 31,2024 |
|
|
September 30,2024 |
|
|
December 31,2023 |
|
|
December 31,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands) |
|
|
Adjusted net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) |
|
$ |
16,772 |
|
|
$ |
(16,464 |
) |
|
$ |
4,412 |
|
|
$ |
5,433 |
|
|
$ |
25,910 |
|
| 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) |
|
|
453 |
|
|
|
10,576 |
|
|
|
— |
|
|
|
11,988 |
|
|
|
— |
|
| Adjusted net income
(non-GAAP) |
|
$ |
17,225 |
|
|
$ |
9,090 |
|
|
$ |
4,412 |
|
|
$ |
32,399 |
|
|
$ |
25,910 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Noninterest expense |
|
$ |
26,125 |
|
|
$ |
37,680 |
|
|
$ |
15,339 |
|
|
$ |
97,791 |
|
|
$ |
59,746 |
|
| Deduct: Merger and related
expenses |
|
|
643 |
|
|
|
14,605 |
|
|
|
— |
|
|
|
16,288 |
|
|
|
— |
|
| Adjusted noninterest
expense |
|
|
25,482 |
|
|
|
23,075 |
|
|
|
15,339 |
|
|
|
81,503 |
|
|
|
59,746 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest income |
|
|
44,541 |
|
|
|
36,942 |
|
|
|
22,559 |
|
|
|
122,984 |
|
|
|
94,138 |
|
| Noninterest income
(expense) |
|
|
1,004 |
|
|
|
1,174 |
|
|
|
(102 |
) |
|
|
4,760 |
|
|
|
3,379 |
|
| Total net interest income and
noninterest income |
|
$ |
45,545 |
|
|
$ |
38,116 |
|
|
$ |
22,457 |
|
|
$ |
127,744 |
|
|
$ |
97,517 |
|
| Efficiency ratio
(non-GAAP) |
|
|
57.4 |
% |
|
|
98.9 |
% |
|
|
68.3 |
% |
|
|
76.6 |
% |
|
|
61.3 |
% |
| Adjusted efficiency ratio
(non-GAAP) |
|
|
55.9 |
% |
|
|
60.5 |
% |
|
|
68.3 |
% |
|
|
63.8 |
% |
|
|
61.3 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax pre-provision income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest income |
|
$ |
44,541 |
|
|
$ |
36,942 |
|
|
$ |
22,559 |
|
|
$ |
122,984 |
|
|
$ |
94,138 |
|
| Noninterest income
(expense) |
|
|
1,004 |
|
|
|
1,174 |
|
|
|
(102 |
) |
|
|
4,760 |
|
|
|
3,379 |
|
| Total net interest income and
noninterest income |
|
|
45,545 |
|
|
|
38,116 |
|
|
|
22,457 |
|
|
|
127,744 |
|
|
|
97,517 |
|
| Less: Noninterest expense |
|
|
26,125 |
|
|
|
37,680 |
|
|
|
15,339 |
|
|
|
97,791 |
|
|
|
59,746 |
|
| Pre-tax pre-provision income
(non-GAAP) |
|
|
19,420 |
|
|
|
436 |
|
|
|
7,118 |
|
|
|
29,953 |
|
|
|
37,771 |
|
| Add: Merger and related
expenses |
|
|
643 |
|
|
|
14,605 |
|
|
|
— |
|
|
|
16,288 |
|
|
|
— |
|
| Adjusted pre-tax pre-provision
income (non-GAAP) |
|
$ |
20,063 |
|
|
$ |
15,041 |
|
|
$ |
7,118 |
|
|
$ |
46,241 |
|
|
$ |
37,771 |
|
|
(1 |
) |
After-tax Day 1 provision for non-PCD loans and unfunded
commitments and merger and related expenses are presented using a
29.56% tax rate. |
| |
|
Three Months Ended |
|
|
Year Ended |
|
| |
|
December 31,2024 |
|
|
September 30,2024 |
|
|
December 31,2023 |
|
|
December 31,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands) |
|
|
Return on Average Assets, Equity, and Tangible
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) |
|
$ |
16,772 |
|
|
$ |
(16,464 |
) |
|
$ |
4,412 |
|
|
$ |
5,433 |
|
|
$ |
25,910 |
|
| Adjusted net income
(non-GAAP) |
|
$ |
17,225 |
|
|
$ |
9,090 |
|
|
$ |
4,412 |
|
|
$ |
32,399 |
|
|
$ |
25,910 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Average assets |
|
$ |
4,168,747 |
|
|
$ |
3,593,157 |
|
|
$ |
2,345,323 |
|
|
$ |
3,095,916 |
|
|
$ |
2,306,233 |
|
| Average shareholders’
equity |
|
|
504,909 |
|
|
|
428,558 |
|
|
|
282,072 |
|
|
|
379,816 |
|
|
|
273,346 |
|
| Less: Average intangible
assets |
|
|
135,073 |
|
|
|
104,409 |
|
|
|
39,035 |
|
|
|
79,366 |
|
|
|
39,195 |
|
| Average tangible common equity
(non-GAAP) |
|
$ |
369,836 |
|
|
$ |
324,149 |
|
|
$ |
243,037 |
|
|
$ |
300,450 |
|
|
$ |
234,151 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Return on average assets |
|
|
1.60 |
% |
|
|
(1.82 |
%) |
|
|
0.75 |
% |
|
|
0.18 |
% |
|
|
1.12 |
% |
| Adjusted return on average
assets (non-GAAP) |
|
|
1.64 |
% |
|
|
1.01 |
% |
|
|
0.75 |
% |
|
|
1.05 |
% |
|
|
1.12 |
% |
| Return on average equity |
|
|
13.21 |
% |
|
|
(15.28 |
%) |
|
|
6.21 |
% |
|
|
1.43 |
% |
|
|
9.48 |
% |
| Adjusted return on average
equity (non-GAAP) |
|
|
13.57 |
% |
|
|
8.44 |
% |
|
|
6.21 |
% |
|
|
8.53 |
% |
|
|
9.48 |
% |
| Return on average tangible
common equity (non-GAAP) |
|
|
18.04 |
% |
|
|
(20.21 |
%) |
|
|
7.20 |
% |
|
|
1.81 |
% |
|
|
11.07 |
% |
| Adjusted return on average
tangible common equity (non-GAAP) |
|
|
18.53 |
% |
|
|
11.16 |
% |
|
|
7.20 |
% |
|
|
10.78 |
% |
|
|
11.07 |
% |
| |
|
December 31,2024 |
|
|
December 31,2023 |
|
| |
|
($ in thousands except share and per share data) |
|
|
Tangible Common Equity Ratio/Tangible Book Value Per
Share |
|
|
|
|
|
|
|
|
| Shareholders’ equity |
|
$ |
511,836 |
|
|
$ |
288,152 |
|
| Less: Intangible assets |
|
|
134,058 |
|
|
|
38,998 |
|
| Tangible common equity
(non-GAAP) |
|
$ |
377,778 |
|
|
$ |
249,154 |
|
| |
|
|
|
|
|
|
|
|
| Total assets |
|
$ |
4,031,654 |
|
|
$ |
2,360,252 |
|
| Less: Intangible assets |
|
|
134,058 |
|
|
|
38,998 |
|
| Tangible assets
(non-GAAP) |
|
$ |
3,897,596 |
|
|
$ |
2,321,254 |
|
| |
|
|
|
|
|
|
|
|
| Equity to asset ratio |
|
|
12.70 |
% |
|
|
12.21 |
% |
| Tangible common equity to
tangible asset ratio (non-GAAP) |
|
|
9.69 |
% |
|
|
10.73 |
% |
| Book value per share |
|
$ |
15.86 |
|
|
$ |
15.69 |
|
| Tangible book value per share
(non-GAAP) |
|
$ |
11.71 |
|
|
$ |
13.56 |
|
| Shares outstanding |
|
|
32,265,935 |
|
|
|
18,369,115 |
|
INVESTOR RELATIONS CONTACTKevin
Mc CabeCalifornia Bank of Commerce, N.A.kmccabe@bankcbc.com
818.637.7065
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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