EX-99 3 ex99-08072013_040806.htm Secconnect.com

Exhibit 99.1



Banc of California, Inc. Reports 2013 Second Quarter

Financial Results


IRVINE, CA, August 7, 2013 – Banc of California, Inc. (NASDAQ: BANC) (the “Company”), the holding company for Pacific Trust Bank and Beach Business Bank, today announced financial results for the three and six months ended June 30, 2013. For the quarter, the Company reported net income and earnings available to common stockholders of $4.36 million or $0.36 per diluted common share. This compares with net income available to common stockholders of $641 thousand, or $0.05 per diluted common share, for the first quarter ended March 31, 2013, and net loss available to common stockholders of $1.05 million, or ($0.09) per diluted common share, for the preceding second quarter ended June 30, 2012. Year to date, the Company reported net income of $5.29 million with earnings available to common shareholders of $5 million, or $0.41 per diluted common share. This compares with net loss available to common shareholders of $1.1 million or ($0.09) per diluted common share for the first six months of 2012. The Company’s consolidated assets totaled $2.5 billion at June 30, 2013, an increase of $484.1 million compared with $2.1 billion at March 31, 2013 and an increase of $1.4 billion compared with $1.1 billion at June 30, 2012. Year to date, total assets increased by $852.4 million. Loans and leases receivable remained flat quarter over quarter at $1.6 billion on June 30, 2013, a year to date increase of $363.3 million and an increase of $768.2 million compared with $829.1 million at June 30, 2012. The increases in total assets and loans and leases receivable were due mainly to organic loan growth, loans acquired in the Beach Business Bank and Gateway Bancorp acquisitions, purchases of seasoned residential mortgage loans, and growth in deposits to support the previously announced branch sale anticipated to close in fourth quarter 2013. Total deposits of $2.1 billion at June 30, 2013 represented an increase of $411.0 million compared with $1.7 billion at March 31, 2013. Year to date, deposits have increased by $803.5 million and by $1.3 billion compared with $852.3 million at June 30, 2012.


Steven Sugarman, Chief Executive Officer of the Company, stated: “We continue to transform our banking franchise. During the second quarter we grew our retail core deposit base and expanded our residential mortgage lending platform. We also successfully closed the acquisition of The Private Bank of California on July 1, 2013. To support these strategic initiatives, we completed two capital raises in June – a common and a preferred stock offering – demonstrating our capital markets capability and commitment to support our capital and liquidity needs. During the second half of the year, we will continue to focus on enhancing long term profitability through the consolidation of our two banks into one nationally chartered financial institution, the closing of the pending acquisitions of The Palisades Group and CS Financial, and the sale of eight non-core branch locations.”


The Company plans to discuss its second quarter earnings, among other items, on August 7, 2013, at 8:00 a.m., Pacific Time. All interested parties are welcome to attend the conference call at 866-503-8728, event code 26768941.


About Banc of California, Inc.

Since 1941, Banc of California, Inc. (NASDAQ:BANC) through its banking subsidiaries Pacific Trust Bank and The Private Bank of California, has provided banking services and home loans to businesses and families in California and the West. Today, Banc of California, Inc. has over $3 billion in consolidated assets and more than 60 banking locations.





Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the “Safe-Harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are necessarily subject to risk and uncertainty and actual results could differ materially from those anticipated due to various factors, including those set forth from time to time in the documents filed or furnished by Banc of California, Inc. with the Securities and Exchange Commission. You should not place undue reliance on forward-looking statements and Banc of California, Inc. undertakes no obligation to update any such statements to reflect circumstances or events that occur after the date on which the forward-looking statement is made.


Source: Banc of California, Inc.


INVESTOR RELATIONS INQUIRIES:

Banc of California, Inc.

Richard Herrin, (949) 236-5300


MEDIA INQUIRIES:

Vectis Strategies

David Herbst, (310) 625-5849



Financial Highlights




For the three months ended,



For the six months ended,




June 30,



March 31,



June 30,



June 30,



June 30,




2013



2013



2012



2013



2012




($ in thousands, except per share data)


















Net income (loss)


$

4,363



$

929



$

(739

)


$

5,292



$

(362

)

Net income (loss) available to common stockholders


$

4,363



$

641



$

(1,053

)


$

5,004



$

(1,076

)

Diluted earnings (loss) per share


$

0.36



$

0.05



$

(0.09

)


$

0.41



$

(0.09

)

ROA



0.76

%



0.21

%



-0.27

%



0.53

%



-0.07

%

ROE



8.58

%



1.96

%



-1.61

%



8.58

%



-1.61

%

Net Interest Margin



3.93

%



3.70

%



3.26

%



5.39

%



-0.39

%

Non-interest income


$

26,072



$

17,928



$

639



$

44,000



$

1,142


Non-interest expense


$

39,594



$

29,558



$

9,943



$

69,152



$

18,161


Provision for Loan Loss


$

1,918



$

2,168



$

279



$

4,086



$

970


Net Charge-offs


$

954



$

601



$

4



$

1,555



$

2,302


Net loans receivable


$

1,597,367



$

1,611,257



$

829,137










Deposits


$

2,109,831



$

1,698,798



$

852,331










Non-accrual loans


$

9,164



$

16,521



$

16,878










ALLL to originated loans



1.49

%



1.52

%



1.40

%













Banc of California, Inc.

Consolidated Statements of Financial Condition

(Dollars in thousands, except per share data)

(Unaudited)



June 30,



March 31,



June 30,




2013



2013



2012


ASSETS










Cash and due from banks


$

8,153



$

8,420



$

7,211


Interest-bearing deposits



454,182




114,776




81,616


Total cash and cash equivalents



462,335




123,196




88,827


Time deposits in financial institutions



2,589




3,635




-


Securities available for sale



106,751




99,658




117,008


Federal Home Loan Bank and Other Bank stock, at cost



10,838




8,844




6,311


Loans and leases receivable, net of allowance of $16,979, $16,015 and $11,449 at June 30, 2013,













March 31, 2013 and June 30, 2012, respectively



1,597,367




1,611,257




829,137


Loans held for sale



257,949




114,582




-


Servicing rights, net



5,040




3,077




-


Accrued interest receivable



7,887




5,051




3,715


Other real estate owned (OREO), net



1,537




1,764




9,239


Premises and equipment, net



15,533




17,695




13,152


Premises and equipment held-for-sale



3,139




-




-


Bank owned life insurance investment



18,792




18,742




18,581


Deferred income tax



7,199




7,572




7,126


Goodwill



7,048




7,048




-


Affordable housing fund investment



2,874




6,038




6,408


Income tax receivable



738




2,624




5,249


Other intangible assets, net



4,740




5,107




-


Other assets



22,758




15,165




10,367


Total assets


$

2,535,114



$

2,051,055



$

1,115,120


LIABILITIES AND SHAREHOLDERS’ EQUITY













Deposits













Noninterest-bearing deposits


$

132,855



$

142,735



$

26,594


Interest-bearing deposits



1,519,948




1,556,063




825,737


Deposits held for sale



457,028




-




-


Total deposits



2,109,831




1,698,798




852,331


Advances from Federal Home Loan Bank



45,000




50,000




35,000


Notes payable, net



82,127




82,031




31,714


Reserve for loss reimbursements on sold loans



3,974




3,498




-


Accrued expenses and other liabilities



25,697




28,430




13,780


Total liabilities



2,266,629




1,862,757




932,825


Commitments and contingent liabilities













SHAREHOLDERS’ EQUITY













Preferred stock, $.01 par value per share, $1,000 per share liquidation preference for a total of $32,000; 50,000,000 shares authorized, 32,000 shares issued and outstanding at June 30, 2013, March 31, 2013 and June 30, 2012



31,934




31,934




31,925


Perpetual preferred stock, $.01 par value per share; Series C, 8% non-cumulative, $1,000 per share liquidation preference, 1,610,000 shares authorized and 1,400,000 outstanding at June 30, 2013; 0 shares outstanding as of March 31, 2013 and June 30, 2012



33,734




-




-


Common stock, $.01 par value per share, 196,863,844 shares authorized; 16,134,900 shares issued and 14,976,979 shares outstanding at June 30, 2013; 12,024,303 shares issued and 10,853,290 shares outstanding at March 31, 2013; 11,774,837 shares issued and 10,604,477 shares outstanding at June 30, 2012



162




120




118


Class B non-voting non-convertible Common stock, $.01 par value per share, 3,136,156 shares authorized; 574,258 shares issued and outstanding at June 30, 2013; 1,112,188 shares issued and outstanding at March 31, 2013; 1,078,807 shares issued and outstanding at June 30, 2012



5




11




11


Additional paid-in capital



197,272




155,139




151,612


Retained earnings



28,678




25,755




23,746


Treasury stock, at cost (1,157,921 shares at June 30, 2013; 1,171,013 shares at March 31, 2013; 1,170,360 shares at June 30, 2012)



(24,088

)



(25,850

)



(25,007

)

Accumulated other comprehensive income/(loss), net



788




1,189




(110

)

Total shareholders’ equity



268,485




188,298




182,295


Total liabilities and shareholders’ equity


$

2,535,114



$

2,051,055



$

1,115,120






Banc of California, Inc.

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

(Unaudited)



Three months ended



Six months ended




June 30,



March 31,



June 30,



June 30,



June 30,




2013



2013



2012



2013



2013


Interest and dividend income
















Loans, including fees


$

26,153



$

18,537



$

9,604



$

44,690



$

19,132


Securities



369




498




694




867




1,431


Dividends and other interest-earning assets



219




133




80




352




140


Total interest and dividend income



26,741




19,168




10,378




45,909




20,703


Interest expense





















Deposits



3,303




1,999




1,358




5,302




2,707


Federal Home Loan Bank advances



58




63




92




121




192


Capital leases



20




12




2




32




2


Notes payable



1,735




1,735




495




3,470




495


Total interest expense



5,116




3,809




1,947




8,925




3,396


Net interest income



21,625




15,359




8,431




36,984




17,307


Provision for loan and lease losses



1,918




2,168




279




4,086




970


Net interest income after provision for loan and lease losses



19,707




13,191




8,152




32,898




16,337


Noninterest income





















Customer service fees



509




546




378




1,055




739


Mortgage banking income



20,261




16,370




-




36,631




-


Other



5,302




1,012




261




6,314




403


Total noninterest income



26,072




17,928




639




44,000




1,142


Noninterest expense





















Salaries and employee benefits



25,311




19,080




5,177




44,391




10,044


Occupancy and equipment



3,630




3,193




1,321




6,823




2,320


All other operating expenses



10,653




7,285




3,445




17,938




5,797


Total noninterest expense



39,594




29,558




9,943




69,152




18,161


Income (loss) before income taxes



6,185




1,561




(1,152

)



7,746




(682

)

Income tax expense



1,822




632




(413

)



2,454




(320

)

Net income (loss)



4,363




929




(739

)



5,292




(362

)

Preferred stock dividends and discount accretion



-




288




314




288




714


Net income (loss) available to common shareholders


$

4,363



$

641



$

(1,053

)


$

5,004



$

(1,076

)

Basic earnings (loss) per common share


$

0.36



$

0.05



$

(0.09

)


$

0.41



$

(0.09

)

Diluted earnings (loss) per common share


$

0.36



$

0.05



$

(0.09

)


$

0.41



$

(0.09

)





Banc of California, Inc.

Selected Financial Data

(Dollars in thousands)



As of or for the three months ended,



As of or for the six months ended,




June 30,



March 31,



June 30,



June 30,



June 30,




2013



2013



2012



2013



2012


Quarterly average balance:
















Total assets



2,301,382




1,770,089




1,109,844




2,027,690




1,078,824


Total gross loans and leases



1,843,645




1,415,091




840,948




1,630,552




829,999


Securities available for sale



102,880




117,108




107,488




109,955




105,668


Total interest earning assets



2,204,574




1,681,593




1,041,194




1,944,529




1,012,795


Total deposits



1,938,164




1,407,415




857,777




1,674,257




837,771


Total Borrowings



129,589




140,711




59,172




135,119




48,488


Total shareholders’ equity



203,873




191,903




184,764




197,921




185,143


Interest Bearing Liabilities



1,909,023




1,405,577




846,761




1,658,692




819,904


Profitability and other ratios:





















Return on avg. assets (1)



0.76

%



0.21

%



-0.27

%



0.53

%



-0.07

%

Return on avg. equity (1)



8.58

%



1.96

%



-1.61

%



5.39

%



-0.39

%

Net interest margin (1)



3.93

%



3.70

%



3.26

%



3.84

%



3.44

%

Noninterest income to total revenue (2)



54.66

%



53.86

%



7.05

%



54.33

%



6.19

%

Noninterest income to avg. assets (1)



4.54

%



4.11

%



0.23

%



4.38

%



0.21

%

Noninterest exp. to avg. assets (1)



6.90

%



6.77

%



3.60

%



6.88

%



3.39

%

Efficiency ratio (3)



83.01

%



88.80

%



109.63

%



85.39

%



98.44

%

Avg. loans to average deposits



95.12

%



100.55

%



98.04

%



97.39

%



99.07

%

Average securities available for sale to average total assets



4.47

%



6.62

%



9.68

%



5.42

%



9.79

%

Average interest-earning assets to average interest-bearing liabilities



115.48

%



119.64

%



122.96

%



117.23

%



123.53

%

Average stockholders’ equity to average total assets



8.86

%



10.84

%



16.65

%



9.76

%



17.16

%

Asset quality information and ratios:





















Nonaccrual Loans, excluding PCI loans


$

9,164



$

16,521



$

16,878










90+ delinquent loans and OREO:





















90+ delinquent loans, excluding PCI loans


$

10,741



$

7,846



$

1,986










Other real estate owned (OREO), net



1,537




1,764




9,239










Totals


$

12,278



$

9,610



$

11,225































Net loan charge-offs


$

954



$

601



$

4



$

1,555



$

2,302


Allowance for loan losses:





















Originated loans


$

16,199



$

15,386



$

11,448










Purchased/acquired loans:





















Non-credit impaired



468




391




-










Credit impaired



312




239




-










Total purchased/acquired loans



780




630




-










Total ALLL


$

16,979



$

16,015



$

11,448










Loans:





















Originated loans


$

1,086,271



$

1,009,394



$

817,103










Purchased/acquired loans:





















Non-credit impaired (4)



390,117




399,422




-










Credit impaired (5)



137,958




218,456




22,728










Total purchased/acquired loans



528,075




617,878




22,728










Total loans


$

1,614,346



$

1,627,272



$

839,831































ALLL to originated loans



1.49

%



1.52

%



1.40

%











(1) Ratios are presented on an annualized basis


(2) Total revenue is equal to the sum of net interest income before provision and noninterest income



(3) Efficiency ratios are calculated by dividing noninterest expense by the sum of net interest income before provision for loan losses and noninterest income


(4) Includes $19.9 million and $17.4 million discounts at June 30, 2013 and March 31, 2013, respectively



(5) Includes $74.5 million, $155.5 million and $15.3 million discounts at June 30, 2013, March 31, 2013 and June 30, 2012, respectively





Banc of California, Inc.

Selected Quarterly Financial Data

(Dollars in thousands, except per share data)



June 30,



March 31,



June 30,




2013



2013



2012


Capital Ratios










Banc of California, Inc. (1)










Total risk-based capital ratio:



20.09

%



14.42

%



N/A


Tier 1 risk-based capital ratio:



18.83

%



13.16

%



N/A


Tier 1 leverage ratio:



11.16

%



9.94

%



N/A


PacTrust Bank













Total risk-based capital ratio:



19.78

%



17.65

%



17.88

%

Tier 1 risk-based capital ratio:



18.52

%



16.40

%



16.63

%

Tier 1 leverage ratio:



10.03

%



10.47

%



11.44

%

Beach Business Bank (2)













Total risk-based capital ratio:



16.79

%



16.06

%



N/A


Tier 1 risk-based capital ratio:



15.88

%



15.37

%



N/A


Tier 1 leverage ratio:



11.94

%



13.39

%



N/A




(1) Banc of California was a Savings and Loan Holding company and was not subject to regulatory capital requirements as of June 30, 2012


(2) Beach Business Bank was not a subsidiary of the Company, and as such the capital ratios as of June 30, 2012 are not presented


Tangible common equity to tangible assets ratio is supplemental financial information determined by a method other than in accordance with U.S. generally accepted accounting principles ("GAAP"). This non-GAAP measure is used by management in the analysis of Banc of California, Inc.’s capital strength. Tangible equity is calculated by subtracting goodwill and other intangible assets from total stockholders' equity. Banking and financial institution regulators also exclude goodwill and other intangible assets from total stockholders' equity when assessing the capital adequacy of a financial institution. Management believes the presentation of this financial measure excluding the impact of these items provides useful supplemental information that is essential to a proper understanding of the capital strength of Banc of California, Inc. This disclosure should not be viewed as a substitution for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies.


The following table reconciles this non-GAAP performance measure to the GAAP performance measure for the periods indicated:




June 30,



March 31,



June 30,




2013



2013



2012


Non-GAAP performance measure










Tangible common equity to tangible assets ratio










Total assets


$

2,535,114



$

2,051,055



$

1,115,120


Less goodwill



(7,048

)



(7,048

)



-


Less other intangible assets



(4,740

)



(5,107

)



-


Tangible assets


$

2,523,326



$

2,038,900



$

1,115,120















Total stockholders' equity


$

268,485



$

188,298



$

182,295


Less preferred stock



(65,668

)



(31,934

)



(31,925

)

Less goodwill



(7,048

)



(7,048

)



-


Less other intangible assets



(4,740

)



(5,107

)



-


Tangible stockholders' equity


$

191,029



$

144,209



$

150,370















Total stockholders' equity to total assets



10.59

%



9.18

%



16.35

%

Tangible stockholders' equity to tangible assets



7.57

%



7.07

%



13.48

%














Common stock outstanding



14,976,979




10,853,290




10,604,477


Class B non-voting non-convertible



574,258




1,112,188




1,078,807


common stock outstanding



574,258




1,112,188




1,078,807


Total common stock outstanding



15,551,237




11,965,478




11,683,284















Tangible common equity per common stock


$

12.28



$

12.05



$

12.87