-Net Earnings of $1.4 Million or $0.05 Per Diluted Share- SAN
DIEGO, April 16 /PRNewswire-FirstCall/ -- PacWest Bancorp (NASDAQ:
PACW) today announced net earnings for the first quarter of 2009
were $1.4 million, or $0.05 per diluted share, compared to net
earnings of $9.6 million, or $0.34 per diluted share, for the
fourth quarter of 2008. The decrease in net earnings compared to
the fourth quarter of 2008 resulted mostly from lower net interest
income, higher provision for credit losses and higher noninterest
expense. The Company also announced today that on April 15, 2009,
its Board of Directors declared a quarterly cash dividend of $0.01
per common share payable on May 29, 2009, to stockholders of record
at the close of business on May 15, 2009. The dividend reduction
from $0.32 per share, most recently paid on February 27, 2009,
reflects the Company's focus on preserving its high capital
position in the current economic environment. FIRST QUARTER RESULTS
First Fourth Quarter Quarter In thousands, except per share data
and percentages 2009 2008
------------------------------------------------------------------------
Net earnings $1,445 $9,621 Diluted earnings per share $0.05 $0.34
Return on average assets 0.13% 0.85% Return on average equity 1.27%
10.15% Efficiency ratio 71.0% 59.1% Net interest margin 4.71% 4.77%
At quarter end: Allowance for credit losses to loans, net of
unearned income 1.95% 1.72% Tangible common equity (TCE) ratios:
Consolidated Company 9.67% 7.54% Pacific Western Bank 10.54% 10.23%
The decrease in net earnings of $8.2 million between the first
quarter of 2009 and the fourth quarter of 2008 is due mainly to the
combination of lower net interest income ($1.1 million after tax),
higher provision for credit losses ($3.0 million after tax), and
higher noninterest expense ($3.0 million after tax). The increase
in the efficiency ratio in the first quarter of 2009 compared to
the fourth quarter of 2008 was due mostly to the combined effects
of lower net interest income, lower noninterest income and higher
noninterest expenses. The increase in the capital ratios was due to
the January 14, 2009 closing of the $100.0 million common stock
investment of CapGen Financial Group. Matt Wagner, Chief Executive
Officer, commented, "During the first quarter we closed the CapGen
investment, integrated the acquired deposit base of Security
Pacific Bank and continued to focus on core deposit growth and
managing our loan portfolio. As we continue to generate earnings in
the current environment, our core profitability allows us to
withstand a healthy credit loss provision and also maintain high
capital levels." Mr. Wagner continued, "We are actively lending in
our marketplace and are pleased with the Bank's new loan generation
and continued advances on existing commitments. Given the current
environment, we remain cautious and vigilant in exercising our
conservative underwriting standards. While we expect economic
challenges to continue, our core deposit growth, increased capital
position, and earnings power position us well." Vic Santoro,
Executive Vice President and Chief Financial Officer, stated, "Both
our positive earnings and the CapGen investment further enhanced
our capital levels such that the Company's and Pacific Western
Bank's TCE ratios were a strong 9.67% and 10.54% at March 31, 2009.
To position the Bank in response to the current interest rate
environment, we continued to runoff the acquired brokered and
higher-cost Security Pacific Bank deposits while at the same time
building on-balance sheet liquidity. More notable, however, was the
$108 million core deposit growth during the quarter, especially in
the noninterest-bearing category. The combined strength of our
capital levels and credit loss reserve allows us to take advantage
of opportunities as they arise." BALANCE SHEET CHANGES Total loans,
net of unearned income, decreased $63.6 million on a net basis to
$3.9 billion during the first quarter of 2009. Although the loan
portfolio shows a net decrease during the quarter, the Bank was
active in its lending markets with advances on existing loan
commitments and new loans totaling $237.7 million. Total deposits
decreased $74.4 million during the first quarter. When brokered and
money desk deposits are excluded, however, our core deposits
increased $108.2 million, with $58.4 million of such increase in
the noninterest-bearing category. at March 31, 2009,
noninterest-bearing deposits totaled $1.2 billion and represented
36.0% of total deposits. Brokered and money desk deposits totaled
$167.4 million at March 31, 2009 compared to $350.0 million at
December 31, 2008. The March 31 balance includes $44.7 million of
brokered and money desk deposits acquired in the November 2008
Security Pacific Bank (SPB) deposit acquisition and $122.7 million
of Pacific Western Bank wholesale CDs. NET INTEREST INCOME Net
interest income totaled $48.8 million for the first quarter of 2009
compared to $50.7 million for the fourth quarter of 2008. Loan
interest income declined $4.7 million in the first quarter due to
lower average balances and increased nonaccrual loans. Interest
expense decreased $3.1 million in the first quarter and resulted
from rate cuts on existing accounts and runoff of the higher-rate
SPB deposits. NET INTEREST MARGIN Our net interest margin for the
first quarter of 2009 was 4.71%, a decrease of 6 basis points when
compared to the fourth quarter of 2008 net interest margin of
4.77%. The decrease in the net interest margin is due mostly to
lower investment and loan yields offset somewhat by lower deposit
cost. The investment securities portfolio yield declined during the
first quarter of 2009 to 3.79% due mostly to lower income on FHLB
stock. The lower loan yield is due to the level of market interest
rates and higher nonaccrual loans. Deposit cost was favorably
impacted during the first quarter of 2009 by rate reductions put
into effect and runoff of higher-cost SPB deposits. The net
interest margin was 4.81% in January, 4.68% in February and 4.64%
in March. The yield on average loans was 6.37% for the first
quarter of 2009 compared to 6.69% for the fourth quarter of 2008;
the loan yield for the month of March was 6.22%. Net reversals of
interest income on nonaccrual loans negatively impacted both loan
yield and net interest margin for the month of March by 16 basis
points. Deposit pricing led to a 34 basis point decrease in the
cost of interest bearing deposits to 1.71% for the first quarter
and a 21 basis point decrease in our all-in deposit cost to 1.12%.
On a monthly basis, all-in deposit costs were 1.18% in January,
1.13% in February and 1.05% in March. Our relatively low cost of
deposits is driven by demand deposit balances, which averaged 34%
of average total deposits during the first quarter of 2009. The
overall cost of interest-bearing liabilities was 2.13% for the
first quarter of 2009, down 32 basis points from the fourth quarter
of 2008 due mostly to lower deposit costs. The cost of
interest-bearing liabilities decreased to 1.99% in March 2009 from
2.42% in December 2008. NONINTEREST INCOME Noninterest income for
the first quarter of 2009 totaled $6.1 million compared to $6.5
million in the fourth quarter of 2008. The decrease is due to lower
deposit account service charges, lower commissions and fees, and
lower appreciation of Bank-owned life insurance policies (BOLI).
Deposit account service charges decreased due to fewer activity
charges, including NSF fees. Other commissions and fees were lower
due to a decrease in loan servicing income, other loan income and
foreign exchange fees. The decrease in BOLI income was due to a
lower crediting rate earned during the first quarter when compared
to the fourth quarter of 2008 and lower BOLI asset balances. Other
noninterest income increased $332,000 due to $536,000 of life
insurance proceeds received during the quarter of which
approximately $383,000 is not taxable. NONINTEREST EXPENSE
Noninterest expense increased $5.2 million to $39.0 million for
first quarter of 2009 from $33.8 million for the fourth quarter of
2008. As described below, noninterest expense in the fourth quarter
of 2008 was reduced by $4.5 million related to a performance-based
restricted stock amortization adjustment. When this item is
excluded, the first quarter increase in total noninterest expense
was $650,000 when compared to the fourth quarter. Such increase is
due mostly to the reorganization and lease charges of $1.2 million
related to a first quarter 2009 reduction in force, premises costs
related to the planned second quarter closing of two banking
offices and additional rent for a discontinued acquired office.
Insurance and assessments increased $450,000 quarter over quarter
due to increased FDIC insurance costs. OREO costs increased
$249,000 due to the combination of lower gain on sale of OREO,
higher write-downs and lower operating costs. Noninterest expense
includes amortization of time-based and performance-based
restricted stock, which is included in compensation, and intangible
asset amortization. Amortization of time-based and
performance-based restricted stock totaled $2.2 million for the
first quarter of 2009. In the fourth quarter of 2008 we reversed
$4.5 million of accumulated amortization for certain performance
stock awards when we concluded it was improbable that the financial
targets required for vesting of such awards would be met. Excluding
the performance-based restricted stock amortization adjustment,
restricted stock amortization totaled $1.8 million for the fourth
quarter of 2008. Amortization expense for all time-based and
performance-based restricted stock awards is estimated to be $8.1
million for 2009. Intangible asset amortization totaled $2.2
million for the first quarter of 2009 and $2.3 million for the
fourth quarter of 2008 and is estimated to be $9.2 million for
2009. The 2009 estimates of both restricted stock award expense and
intangible asset amortization are subject to change. TAXES The
effective tax rate for the first quarter of 2009 was 23.3% compared
to 34.3% for the fourth quarter of 2008. The effective tax rates
are generally lower than the blended Federal and State statutory
rate of 42.0% due to tax credits on certain investments and other
tax-exempt income. The first quarter of 2009 effective tax rate was
lower than that of the prior quarter as the proportion of
tax-exempt income to pretax income was higher in the first quarter
of 2009. CREDIT QUALITY The credit loss provision for the first
quarter of 2009 of $14.0 million was based on our reserve
methodology and considered, among other factors, net charge-offs,
the level and trends of classified, criticized, past due and
nonaccrual loans, general market conditions and portfolio
concentrations. At March 31, 2009, the allowance for credit losses
totaled $76.6 million and represented 1.95% of loans net of
unearned income compared to $68.8 million and 1.72% at the end of
December. Our loan portfolio continues to experience pressure from
the economic trends in southern California as indicated by the
level of net charge-offs and the increases in nonaccrual loans and
nonperforming assets. We expect that such pressures will continue
in 2009. Nonperforming assets include nonaccrual loans and other
real estate owned (OREO) and totaled $186.2 million at the end of
March compared to $104.8 million at the end of December. OREO
totaled $47.7 million at the end of March compared to $41.3 million
at the end of December. The increase in OREO is due to 7 additions
totaling $12.0 million, an increase in the valuation reserve of
$535,000 and 6 sales totaling $5.1 million. The ratio of
nonperforming assets to loans and OREO increased to 4.69% at March
31, 2009 from 2.60% at December 31, 2008. The types of loans
included in the nonaccrual and accruing loans past due between 30
and 89 days categories as of March 31, 2009 and December 31, 2008
follow: Accruing and over 30 days Nonaccrual loans past due
---------------- ------------- Balance as of ------------- Loan
category 3/31/09 12/31/08 3/31/09 12/31/08 ------------- -------
-------- ------- -------- (Dollars in thousands) SBA 504 $3,869
$5,308 $2,699 $- SBA 7(a) and Express 10,173 7,544 738 2,330
Residential construction 44,778 14,738 22,893 5,342 Commercial real
estate 22,782 11,081 13,442 26,674 Commercial construction 14,875
1,298 - 3,956 Commercial 18,255 20,325 2,543 2,298 Commercial land
1,641 - - 142 Residential other 18,896 86 743 457 Residential land
1,257 1,665 - - Residential multifamily 301 - - 3,292 Other,
including foreign 1,670 1,425 640 1,133 ----- ----- --- -----
$138,497 $63,470 $43,698 $45,624 ======== ======= ======= =======
The net increase in nonaccrual loans during the first quarter is
composed of additions of $99.8 million, repayments and payoffs of
$9.7 million, charge-offs of $3.3 million, and foreclosures of
$11.8 million. The increase in nonaccrual loans included 7
residential construction loans totaling $36.6 million, 5 commercial
real estate loans totaling $16.8 million, 3 commercial construction
loans totaling $14.3 million, and 2 loans in the residential other
category totaling $18.0 million. Approximately $13.2 million of the
increase in the nonaccrual residential construction category was
attributed to three borrowers involved in the construction of
high-end single-family residences located in the Desert region. In
addition, a $19.4 million 28-unit condo project with excess land
for future development located in Costa Mesa was placed in
nonaccrual status. The increase in nonaccrual commercial real
estate loans was centered in 3 properties: one office building for
$3.6 million located in the Inland Empire and a retail project for
$4.9 million and a golf course for $4.6 million located in the
Desert region. The nonaccrual commercial construction loan increase
is related to 2 completed office buildings in the Desert region and
a 4-unit industrial building located in southeast San Diego. The
increase in the nonaccrual residential other loan category relates
to one borrowing relationship with an underlying collateral pool
that includes two lots and a home located on a high-end country
club and two high-end coastal homes in San Diego County. Included
in the nonaccrual loans at the end of March are $14.0 million of
SBA related loans representing 10% of total nonaccrual loans at
that date. The SBA 504 loans are secured by first trust deeds on
owner-occupied business real estate with loan-to-value ratios of
generally 50% or less at the time of origination. SBA 7(a) loans
are secured by borrowers' real estate and/or business assets and
are covered by an SBA guarantee of up to 85% of the loan amount.
The SBA guaranteed portion on the 7(a) and Express loans shown
above is $8.4 million. At March 31, 2009, the SBA loan portfolio
totaled $161.8 million and was composed of $119.9 million in SBA
504 loans and $41.9 million in SBA 7(a) and Express loans. Loans
accruing and over 30 days past due decreased $1.9 million during
the first quarter The increase in the residential construction
category is due mostly to a $13.1 million loan for an in-fill
single family lot development loan in the South Bay area of Los
Angeles County and a project for an $8.8 million high-end single
family residential development in the Desert region. The decline in
the commercial real estate category is due mostly to two loans for
$8.6 million transferred to nonaccrual status and one loan for $4.4
million that was brought current. Our exposure to nonowner-occupied
residential construction loans was reduced by $2.6 million during
the first quarter to $231.1 million at the end of March. The
reduction was due mostly to a combination of foreclosures and
charge-offs of $6.5 million and net advances for new loans and
existing commitments of $3.9 million. Twelve nonowner-occupied
residential construction loans totaling approximately $40.3 million
were on nonaccrual status at March 31, 2009. The details of the
nonowner-occupied residential construction loan portfolio as of the
dates indicated follow: As of December As of March 31, 2009 31,
2008 Loan Category Number Average Balance of loans loan balance
Balance (Dollars in thousands) Residential land acquisition and
development $58,420 23 $2,540 $57,308 Residential nonowner-occupied
single family 86,574 30 2,886 94,067 Unimproved residential land
48,814 13 3,755 50,163 Residential multifamily 37,341 10 3,734
32,184 $231,149 76 $3,041 $233,722 Our largest loan portfolio
concentration is the real estate mortgage category, which includes
loans secured by commercial and residential real estate. The
following table presents our real estate mortgage loan portfolio as
of the dates indicated. At March At December Loan Category 31, 2009
31, 2008 ------------- --------- ------------ (Dollars in thousand)
Commercial real estate mortgage 100% owner-occupied $362,428
$376,975 Nonowner-occupied office building, industrial and
warehouse facilities 1,880,215 1,861,868 --------- --------- Total
commercial real estate mortgage 2,242,643 2,238,843 ---------
--------- Residential real estate mortgage: Multi-family 103,329
107,377 Single family owner-occupied 91,004 91,532 Single family
nonowner-occupied 45,814 35,337 ------ ------ Total residential
real estate mortgage 240,147 234,246 ------- ------- Total real
estate mortgage $2,482,790 $2,473,089 ========== ==========
REGULATORY CAPITAL MEASURES ARE ABOVE THE WELL-CAPITALIZED MINIMUMS
PacWest and its wholly-owned banking subsidiary, Pacific Western
Bank, each remained well capitalized at March 31, 2009 as shown in
the following table. Minimum Regulatory Requirements Actual Well
Pacific Company Capitalized Western Consolidated Tier 1 leverage
capital ratio 5.00% 10.76% 12.67% Tier 1 risk-based capital ratio
6.00% 11.20% 13.17% Total risk-based capital 10.00% 12.45% 14.43%
Tangible common equity (TCE) ratio -- 10.54% 9.67% EARNINGS PER
SHARE On January 1, 2009, FSP EITF 03-06-1, Determining Whether
Instruments Granted in Share-Based Payment Transactions are
Participating Securities became effective for us. This
pronouncement clarified that all outstanding unvested share-based
payment awards that contain rights to nonforfeitable dividends are
considered participating securities and are included in the
two-class method of determining basic and diluted earnings per
shares. All our unvested restricted stock participates with our
common stockholders in dividends. Application of the new standard
results in a reduction of net earnings available to common
stockholders and lower earnings per share when compared to the
previous requirements. The new standard's effect on both basic and
diluted earnings per share for the fourth quarter of 2008 was a
reduction of $0.01 to $0.34 from $0.35. There was no effect on the
net loss per share for the first quarter of 2008. ABOUT PACWEST
BANCORP PacWest Bancorp is a bank holding company with $4.5 billion
in assets as of March 31, 2009, with one wholly-owned banking
subsidiary, Pacific Western Bank. Through 61 full-service community
banking branches, Pacific Western provides commercial banking
services, including real estate, construction and commercial loans,
to small and medium-sized businesses. Pacific Western's branches
are located in Los Angeles, Orange, Riverside, San Diego and San
Bernardino Counties. Through its subsidiary BFI Business Finance
and its divisions First Community Financial and Pacific Western SBA
Lending, Pacific Western also provides working capital financing to
growing companies located throughout the Southwest, primarily in
the states of Arizona, California and Texas. Additional information
regarding PacWest Bancorp is available on the Internet at
http://www.pacwestbancorp.com/. Information regarding Pacific
Western Bank is also available on the Internet at
http://www.pacificwesternbank.com/. FORWARD-LOOKING STATEMENTS This
press release contains certain forward-looking information about
PacWest that is intended to be covered by the safe harbor for
"forward-looking statements" provided by the Private Securities
Litigation Reform Act of 1995. All statements other than statements
of historical fact are forward-looking statements. Such statements
involve inherent risks and uncertainties, many of which are
difficult to predict and are generally beyond the control of the
Company. We caution readers that a number of important factors
could cause actual results to differ materially from those
expressed in, implied or projected by, such forward-looking
statements. Risks and uncertainties include, but are not limited
to: lower than expected revenues; credit quality deterioration or a
pronounced and sustained reduction in real estate values could
cause an increase in the allowance for credit losses and a
reduction in net earnings; increased competitive pressure among
depository institutions; the Company's ability to complete future
acquisitions, successfully integrate such acquired entities, or
achieve expected beneficial synergies and/or operating efficiencies
within expected time-frames or at all; the possibility that
personnel changes will not proceed as planned; the cost of
additional capital is more than expected; a change in the interest
rate environment reduces interest margins; asset/liability
repricing risks and liquidity risks; pending legal matters may take
longer or cost more to resolve or may be resolved adversely to the
Company; general economic conditions, either nationally or in the
market areas in which the Company does or anticipates doing
business, are less favorable than expected; environmental
conditions, including natural disasters, may disrupt our business,
impede our operations, negatively impact the values of collateral
securing the Company's loans or impair the ability of our borrowers
to support their debt obligations; the economic and regulatory
effects of the continuing war on terrorism and other events of war,
including the war in Iraq; legislative or regulatory requirements
or changes adversely affecting the Company's business; and changes
in the securities markets; regulatory approvals for any capital
activities cannot be obtained on the terms expected or on the
anticipated schedule; and, other risks that are described in
PacWest's public filings with the U.S. Securities and Exchange
Commission (the "SEC"). If any of these risks or uncertainties
materializes or if any of the assumptions underlying such
forward-looking statements proves to be incorrect, PacWest's
results could differ materially from those expressed in, implied or
projected by such forward-looking statements. PacWest assumes no
obligation to update such forward-looking statements. For a more
complete discussion of risks and uncertainties, investors and
security holders are urged to read PacWest Bancorp's annual report
on Form 10-K, quarterly reports on Form 10-Q and other reports
filed by PacWest with the SEC. The documents filed by PacWest with
the SEC may be obtained at PacWest Bancorp's website at
http://www.pacwestbancorp.com/ or at the SEC's website at
http://www.sec.gov/. These documents may also be obtained free of
charge from PacWest by directing a request to: PacWest Bancorp c/o
Pacific Western Bank, 275 North Brea Boulevard, Brea, CA 92821.
Attention: Investor Relations. Telephone 714-671-6800. UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS March December 31, 2009 31,
2008 -------- -------- (In thousands, except share data) Assets:
Cash and due from banks $118,009 $100,925 Federal funds sold - 165
--- --- Total cash and cash equivalents 118,009 101,090
Interest-bearing deposits in financial institutions 95,758 58,780
Federal Home Loan Bank stock, at cost 33,782 33,782 Securities
available-for-sale, at estimated fair value 141,106 121,577 -------
------- Total securities 174,888 155,359 Loans, net of unearned
income 3,924,285 3,987,891 Allowance for loan losses (71,361)
(63,519) ------- ------- Net loans 3,852,924 3,924,372 Premises and
equipment 24,202 24,675 Other real estate owned, net 47,673 41,310
Intangible assets 37,675 39,922 Cash surrender value of life
insurance 66,198 70,588 Other assets 78,743 79,406 ------ ------
Total assets $4,496,070 $4,495,502 ========== ==========
Liabilities and Stockholders' Equity: Liabilities:
Noninterest-bearing deposits $1,223,884 $1,165,485 Interest-bearing
deposits 2,176,932 2,309,730 --------- --------- Total deposits
3,400,816 3,475,215 Accrued interest payable and other liabilities
46,302 64,567 Borrowings 450,000 450,000 Subordinated debentures
129,946 129,994 ------- ------- Total liabilities 4,027,064
4,119,776 Stockholders' Equity 469,006 375,726 ------- -------
Total Liabilities and Stockholders' Equity $4,496,070 $4,495,502
========== ========== Shares outstanding (including 1,267,405
shares at March 31, 2009 and 1,309,586 shares at December 31, 2008,
underlying unvested stock awards) 32,326,505 28,516,106 Tangible
book value per share $13.34 $11.78 Book value per share $14.51
$13.18 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(LOSS) Quarters Ended -------------- 3/31/09 12/31/08 3/31/08
------- -------- ------- (In thousands, except per share data)
Interest income: Interest and fees on loans $61,847 $66,507 $75,653
Interest on federal funds sold - 75 40 Interest on time deposits in
other financial institutions 61 176 3 Interest on investment
securities 1,546 1,707 1,701 ----- ----- ----- Total interest
income 63,454 68,465 77,397 ------ ------ ------ Interest expense:
Interest expense on deposits 9,320 11,416 11,821 Interest expense
on borrowings 3,582 4,217 5,307 Interest expense on subordinated
debentures 1,779 2,107 2,409 ----- ----- ----- Total interest
expense 14,681 17,740 19,537 ------ ------ ------ Net interest
income before provision for credit losses 48,773 50,725 57,860
Provision for credit losses 14,000 8,800 26,000 ------ ----- ------
Net interest income after provision for credit losses 34,773 41,925
31,860 ------ ------ ------ Noninterest income: Service charges on
deposit accounts 3,149 3,420 3,224 Other commissions and fees 1,685
2,062 1,519 Gain (loss) on sale of loans - - 269 Increase in cash
surrender value of life insurance 439 584 587 Other income 808 476
870 --- --- --- Total noninterest income 6,081 6,542 6,469 -----
----- ----- Noninterest expense: Compensation 19,331 15,088 18,846
Occupancy 6,386 6,410 5,870 Data processing 1,628 1,590 1,543 Other
professional services 1,524 1,688 1,415 Business development 725
789 756 Communications 693 766 824 Insurance and assessments 1,598
1,148 540 Other real estate owned, net 997 748 (26) Intangible
asset amortization 2,247 2,332 2,530 Reorganization and lease
charges 1,215 - - Goodwill write-off - - 275,000 Other 2,625 3,260
2,914 ----- ----- ----- Total noninterest expense 38,969 33,819
310,212 ------ ------ ------- (Loss) earnings before income taxes
1,885 14,648 (271,883) Income taxes 440 5,027 840 --- ----- --- Net
(loss) earnings $1,445 $9,621 $(272,723) ====== ====== =========
Per share information (Loss) earnings per share: Basic (loss)
earnings per share $0.05 $0.34 $(10.05) Diluted (loss) earnings per
share $0.05 $0.34 $(10.05) UNAUDITED AVERAGE BALANCE SHEETS
Quarters Ended -------------- 3/31/09 12/31/08 3/31/08 -------
-------- ------- (Dollars in thousands) Average Assets: Loans, net
of unearned income $3,938,322 $3,952,872 $4,019,224 Investment
securities 165,333 142,494 143,379 Federal funds sold 260 29,702
5,032 Interest-bearing deposits in financial institutions 92,271
104,800 324 ------ ------- --- Average earning assets 4,196,186
4,229,868 4,167,959 Other assets 284,628 274,687 1,030,130 -------
------- --------- Average total assets $4,480,814 $4,504,555
$5,198,089 ========== ========== ========== Average Liabilities and
Stockholders' Equity: Average liabilities Noninterest-bearing
deposits $1,163,059 $1,208,085 $1,273,173 Interest checking 349,908
338,434 369,841 Money market accounts 841,410 858,971 1,089,672
Savings 123,005 117,278 104,905 Time deposits 899,666 899,264
413,712 ------- ------- ------- Interest-bearing deposits 2,213,989
2,213,947 1,978,130 --------- --------- --------- Average deposits
3,377,048 3,422,032 3,251,303 Subordinated debentures 129,975
130,025 137,829 Borrowings 451,608 536,370 620,349 Other
liabilities 61,882 38,919 50,207 ------ ------ ------ Average
liabilities 4,020,513 4,127,346 4,059,688 --------- ---------
--------- Average equity 460,301 377,209 1,138,401 ------- -------
--------- Average liabilities and stockholders' equity $4,480,814
$4,504,555 $5,198,089 ========== ========== ========== Yield
Analysis: Average earning assets $4,196,186 $4,229,868 $4,167,959
Yield 6.13% 6.44% 7.47% Average interest-bearing deposits
$2,213,989 $2,213,947 $1,978,130 Cost 1.71% 2.05% 2.40% Average
deposits $3,377,048 $3,422,032 $3,251,303 Cost 1.12% 1.33% 1.46%
Average interest-bearing liabilities $2,795,572 $2,880,342
$2,736,308 Cost 2.13% 2.45% 2.87% Average subordinated debentures
129,975 130,025 137,829 Cost 5.55% 6.45% 7.03% Average borrowings
451,608 536,370 620,349 Cost 3.22% 3.13% 3.44% Average interest
sensitive liabilities $3,958,631 $4,088,427 $4,009,481 Cost 1.50%
1.73% 1.96% Interest spread 4.00% 3.99% 4.60% Net interest margin
4.71% 4.77% 5.58% DEPOSITS (unaudited) As of the Dates Indicated
------------------------- 3/31/09 12/31/08 3/31/08 ------- --------
------- (Dollars in thousands) Transaction accounts: Demand
deposits $1,223,884 $1,165,485 $1,277,302 Interest checking 359,551
342,241 373,145 ------- ------- ------- Total transaction accounts
1,583,435 1,507,726 1,650,447 Non-transaction accounts: Money
market 890,558 837,873 1,165,336 Savings 116,550 124,603 100,505
Time deposits under $100,000 400,084 611,083 136,476 Time deposits
over $100,000 410,189 393,930 266,379 ------- ------- ------- Total
non-transaction accounts 1,817,381 1,967,489 1,668,696 ---------
--------- --------- Total deposits $3,400,816 $3,475,215 $3,319,143
========== ========== ========== LOAN CONCENTRATION (unaudited) As
of the Dates Indicated ------------------------- 3/31/09 12/31/08
9/30/08 6/30/08 3/31/08 * ------- -------- ------- -------
--------- (Dollars in thousands) Loan Category: Domestic:
Commercial $779,971 $845,410 $803,717 $833,376 $855,228 Real
estate- construction 583,709 579,884 608,968 623,605 661,782
Commercial real estate-mortgage 2,482,790 2,473,089 2,437,593
2,361,529 2,361,365 Consumer 38,615 44,938 41,671 47,500 47,506
Foreign: Commercial 44,955 50,918 49,153 46,096 48,737 Other 2,126
2,245 2,323 1,861 906 ----- ----- ----- ----- --- Total gross
loans, including loans held for sale $3,932,166 $3,996,484
$3,943,425 $3,913,967 $3,975,524 ========== ========== ==========
========== ========== *Commercial and commercial real
estate-mortgage categories include loans held for sale. COMPONENTS
OF ALLOWANCE FOR CREDIT LOSSES, NONPERFORMING ASSETS AND CREDIT
QUALITY MEASURES (Unaudited) As of the Dates Indicated
------------------------- 3/31/09 12/31/08 3/31/08 ------- --------
------- (Dollars in thousands) ALLOWANCE FOR CREDIT LOSSES:
---------------------------- Allowance for loan losses $71,361
$63,519 $60,199 Reserve for unfunded loan commitments 5,271 5,271
8,671 ----- ----- ----- Allowance for credit losses $76,632 $68,790
$68,870 ======= ======= ======= NONPERFORMING ASSETS:
--------------------- Nonaccrual loans $138,497 $63,470 $31,955
Other real estate owned 47,673 41,310 6,055 ------ ------ -----
Total nonperforming assets $186,170 $104,780 $38,010 ========
======== ======= Allowance for credit losses to loans, net of
unearned income 1.95% 1.72% 1.76% Allowance for credit losses to
nonaccrual loans 55.33% 108.38% 215.5% Nonperforming assets to
total loans, including loans held for sale, and other real estate
owned 4.69% 2.60% 0.96% Nonaccrual loans to total loans, including
loans held for sale 3.53% 1.59% 0.81% ALLOWANCE FOR CREDIT LOSSES
ROLLFORWARD AND NET CHARGE-OFF MEASUREMENT (unaudited) As of or for
the: ----------------- Quarter Ended Year Ended Quarter Ended
------------- ---------- ------------- 3/31/09 12/31/08 3/31/08
------- -------- ------- (Dollars in thousands) Balance at
beginning of period $68,790 $61,028 $61,028 Loans charged-off:
Commercial (1,881) (7,664) (108) Real estate-construction (1,572)
(24,998) (18,335) Real estate-mortgage (2,738) (2,617) (68)
Consumer (216) (3,947) (38) Foreign (368) (349) - ---- ---- ---
Total loans charged-off (6,775) (39,575) (18,549) Recoveries on
loans charged-off: Commercial 303 971 356 Real estate-construction
- 88 - Real estate-mortgage 190 412 26 Consumer 110 47 9 Foreign 14
19 - --- --- --- Total recoveries on loans charged-off 617 1,537
391 --- ----- --- Net charge-offs (6,158) (38,038) (18,158)
Provision for credit losses 14,000 45,800 26,000 Balance at end of
period $76,632 $68,790 $68,870 ======= ======= ======= Annualized
net charge-offs to average loans 0.63% 0.96% 1.82% Contact
information: Matt Wagner, Chief Executive Officer, (310) 728-1020
Vic Santoro, Executive Vice President and CFO, (310) 728-1021
DATASOURCE: PacWest Bancorp CONTACT: Matt Wagner, Chief Executive
Officer, +1-310-728-1020, or Vic Santoro, Executive Vice President
and CFO, +1-310-728-1021, both of PacWest Bancorp Web Site:
http://www.firstcommunitybancorp.com/
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