EX-99.1 2 tm203711d1_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

PRESS RELEASE

PacWest Bancorp
(Nasdaq: PACW)

Contact:

Matthew P. Wagner

Patrick J. Rusnak

President and CEO

Executive Vice President and CFO

Phone:

310-887-8520

714-989-4705

FOR IMMEDIATE RELEASE

January 21, 2020

PACWEST BANCORP ANNOUNCES RESULTS

FOR THE FOURTH QUARTER AND FULL YEAR 2019

Fourth Quarter 2019 Highlights

•

Net Earnings of $117.9 Million, or $0.98 Per Diluted Share

•

Loan and Lease Production of $1.0 Billion; $111 Million of Net Loan Growth

•

Core Deposits Represents 84% of Total Deposits

•

Cost of Average Total Deposits Decreased 12 Basis Points from Q3 to 71 Basis Points

•

Net Charge-offs to Average Loans of Two Basis Points

Full Year 2019 Highlights

•

Net Earnings of $468.6 Million, or $3.90 Per Diluted Share

•

Loan and Lease Production of $4.9 Billion; $889 Million of Net Loan Growth or 5%

•

Net Charge-offs to Average Loans of Nine Basis Points; 62% Lower for 2019 Compared to 2018

Los Angeles, California . . . PacWest Bancorp (Nasdaq: PACW) today announced net earnings for the fourth quarter of 2019 of $117.9 million, or $0.98 per diluted share, compared to net earnings for the third quarter of 2019 of $110.0 million, or $0.92 per diluted share. The increase in net earnings in the fourth quarter was primarily due to lower income tax expense, of which $9.1 million related to benefits from changes in state apportionment. Net earnings for the full year 2019 were $468.6 million, or $3.90 per diluted share, compared to net earnings for the full year 2018 of $465.3 million, or $3.72 per diluted share.

Matt Wagner, President and CEO, commented, “We finished the year with strong earnings and continued improvement in our credit quality metrics and credit costs reflected by our fourth quarter net charge-offs ratio of two basis points. Our fourth quarter results produced a return on assets of 1.77% and a return on tangible equity of 19.98%.”

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Mr. Wagner continued, “The strong fourth quarter capped a year of profitable growth and continued our solid operating performance resulting in a 2019 return on assets of 1.80% and return on tangible equity of 20.66%. The de-risking strategy initiated in 2017 has proven to be successful as our net charge-offs ratio decreased from 40 basis points in 2017 to nine basis points in 2019, while the provision for credit losses declined by 63% from $59.0 million for non-PCI loans in 2017 to $22.0 million in 2019. Our strategy and these outstanding operating results allowed us to return $444 million to our stockholders in 2019 through stock repurchases and dividends. Our earnings per share for the full year 2019 increased by 5% over the prior year to $3.90.”

Mr. Wagner added, “In 2019, we successfully completed the rebranding of all of our operating groups under one brand as Pacific Western Bank. As we head into 2020, we will continue to focus on profitable growth and increasing the value of our franchise for our stockholders.”

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FINANCIAL HIGHLIGHTS

	At or For the									At or For the
	Three Months Ended									Year Ended
	December 31,			September 30,			Increase			December 31,						Increase
Financial Highlights	2019			2019			(Decrease)			2019			2018			(Decrease)
	(Dollars in thousands, except per share data)
Net earnings	$	117,881		$	110,026		$	7,855		$	468,636		$	465,339		$	3,297
Diluted earnings per share	$	0.98		$	0.92		$	0.06		$	3.90		$	3.72		$	0.18
Return on average assets		1.77	%		1.65	%		0.12			1.80	%		1.91	%		(0.11	)
Return on average tangible equity (1)		19.98	%		19.01	%		0.97			20.66	%		21.22	%		(0.56	)

Net interest margin ("NIM") (tax equivalent)		4.33	%		4.46	%		(0.13	)		4.54	%		5.05	%		(0.51	)
Yield on average loans and leases (tax equivalent)		5.67	%		5.91	%		(0.24	)		6.00	%		6.22	%		(0.22	)
Cost of average total deposits		0.71	%		0.83	%		(0.12	)		0.77	%		0.44	%		0.33
Efficiency ratio		44.8	%		42.3	%		2.5			42.7	%		41.0	%		1.7

Total assets	$	26,770,806		$	26,724,627		$	46,179		$	26,770,806		$	25,731,354		$	1,039,452
Loans and leases held for investment, net of deferred fees	$	18,846,872		$	18,735,543		$	111,329		$	18,846,872		$	17,957,713		$	889,159
Noninterest-bearing demand deposits	$	7,243,298		$	7,441,185		$	(197,887	)	$	7,243,298		$	7,888,915		$	(645,617	)
Core deposits	$	16,187,287		$	16,471,264		$	(283,977	)	$	16,187,287		$	16,346,671		$	(159,384	)
Total deposits	$	19,233,036		$	19,733,203		$	(500,167	)	$	19,233,036		$	18,870,501		$	362,535

As percentage of total deposits:
Noninterest-bearing demand deposits		38	%		38	%		-			38	%		42	%		(4	)
Core deposits		84	%		84	%		-			84	%		87	%		(3	)

Equity to assets ratio		18.51	%		18.41	%		0.10			18.51	%		18.75	%		(0.24	)
Tangible common equity ratio (1)		9.79	%		9.65	%		0.14			9.79	%		9.60	%		0.19
Book value per share	$	41.36		$	41.06		$	0.30		$	41.36		$	39.17		$	2.19
Tangible book value per share (1)	$	19.77		$	19.43		$	0.34		$	19.77		$	18.02		$	1.75

(1) Non-GAAP measure.

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INCOME STATEMENT HIGHLIGHTS

Net Interest Income

Net interest income decreased by $5.6 million to $246.6 million for the fourth quarter of 2019 compared to $252.2 million for the third quarter of 2019 due mainly to a lower yield on average loans and leases and a lower balance of average loans and leases. The tax equivalent yield on average loans and leases was 5.67% for the fourth quarter of 2019 compared to 5.91% for the third quarter of 2019. The decrease in the yield on average loans and leases was due principally to the repricing of variable-rate loans causing lower coupon interest in addition to lower loan fee income in the fourth quarter compared to the third quarter, offset partially by higher loan prepayment fees. The prepayment fees added seven basis points to the fourth quarter yield on average loans and leases and five basis points to the third quarter yield on average loans and leases.

The tax equivalent NIM was 4.33% for the fourth quarter of 2019 compared to 4.46% for the third quarter of 2019. The decrease in the NIM was due mainly to the repricing of variable-rate loans causing lower coupon interest and lower loan fee income, offset partially by the lower cost of interest-bearing liabilities.

The cost of average total deposits decreased to 0.71% for the fourth quarter of 2019 from 0.83% for the third quarter of 2019 due mainly to a lower cost of average interest-bearing deposits, offset partially by a lower average balance of noninterest-bearing deposits. Our cost of average total deposits has declined from a 2019 peak of 86 basis points in the month of July to a 2019 low of 66 basis points in the month of December. The lower cost of average interest-bearing deposits reflected actions taken to reduce deposit rates in light of the fed funds target rate cuts during the second half of 2019.

Provision for Credit Losses

The following table presents details of the provision for credit losses for the periods indicated:

	Three Months Ended
	December 31,		September 30,			Increase
Provision for Credit Losses	2019		2019			(Decrease)
			(In thousands)
Addition to allowance for loan and lease losses	$	1,000	$	8,000		$	(7,000	)
Addition (reduction) to reserve for unfunded loan commitments		2,000		(1,000	)		3,000
Total provision for credit losses	$	3,000	$	7,000		$	(4,000	)

The increase in the provision for unfunded commitments was the result of significant growth in unfunded construction loan commitments in the fourth quarter of 2019.

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Noninterest Income

The following table presents details of noninterest income for the periods indicated:

	Three Months Ended
	December 31,			September 30,		Increase
Noninterest Income	2019			2019		(Decrease)
				(In thousands)
Service charges on deposit accounts	$	3,611		$	3,525	$	86
Other commissions and fees		10,170			10,855		(685	)
Leased equipment income		10,648			9,615		1,033
Gain on sale of loans and leases		23			765		(742	)
Gain on sale of securities		184			908		(724	)
Other income:
Dividends and (losses) gains on equity investments		(794	)		14		(808	)
Warrant income		1,240			3,936		(2,696	)
Other		2,094			3,811		(1,717	)
Total noninterest income	$	27,176		$	33,429	$	(6,253	)

Noninterest income decreased by $6.3 million to $27.2 million for the fourth quarter of 2019 compared to $33.4 million for the third quarter of 2019 due primarily to a $2.7 million decrease in warrant income, a $1.7 million decrease in other income, a $0.8 million decrease in dividends and gains on equity investments, a $0.7 million decrease in gain on sale of loans and leases, and a $0.7 million decrease in gain on sale of securities, offset partially by a $1.0 million increase in leased equipment income. The decrease in warrant income was due to lower gains resulting from exercised warrants. The decrease in other income was due mainly to lower gains from lease terminations. The decreases in gain on sale of loans and leases and gain on sale of securities were attributable to a lower level of sales activity in the fourth quarter of 2019 as compared to the third quarter of 2019. The increase in leased equipment income was due primarily to a higher average balance of leased equipment in the fourth quarter compared to the third quarter.

Noninterest Expense

The following table presents details of noninterest expense for the periods indicated:

	Three Months Ended
	December 31,			September 30,		Increase
Noninterest Expense	2019			2019		(Decrease)
				(In thousands)
Compensation	$	74,637		$	71,424	$	3,213
Occupancy		14,541			14,089		452
Data processing		6,770			7,044		(274	)
Other professional services		4,261			4,400		(139	)
Insurance and assessments		4,168			4,100		68
Intangible asset amortization		4,153			4,833		(680	)
Leased equipment depreciation		6,856			5,951		905
Foreclosed assets (income) expense, net		(3,446	)		8		(3,454	)
Acquisition, integration and reorganization costs		(269	)		-		(269	)
Customer related expense		3,952			3,539		413
Loan expense		2,967			3,628		(661	)
Other		5,138			7,793		(2,655	)
Total noninterest expense	$	123,728		$	126,809	$	(3,081	)

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Noninterest expense decreased by $3.1 million to $123.7 million for the fourth quarter of 2019 compared to $126.8 million for the third quarter of 2019 attributable primarily to a $3.5 million increase in foreclosed assets income and a $2.7 million decrease in other expense, offset partially by a $3.2 million increase in compensation expense. Foreclosed assets income increased due to a $3.3 million gain on the sale of a repossessed asset. Other expense decreased due primarily to a $1.7 million reversal of previously accrued merger costs and a $1.1 million credit adjustment to franchise tax expense for refunds related to state apportionment changes. Compensation expense increased due mainly to higher bonus expense of $2.9 million.

Income Taxes

The overall effective income tax rate was 19.8% for the fourth quarter of 2019 and 27.5% for the third quarter of 2019. The fourth quarter 2019 effective tax rate was lower due primarily to $9.1 million of benefits related to changes in state apportionment net of the federal tax effect. The effective tax rate for the year ended December 31, 2019 was 26.0% and for the full year 2020 is currently estimated to be in the range of 26-28%.

BALANCE SHEET HIGHLIGHTS

Loans and Leases

The following table presents roll forwards of loans and leases held for investment, net of deferred fees, for the periods indicated:

	Three Months Ended						Year Ended
Roll Forward of Loans and Leases Held	December 31,			September 30,			December 31,
for Investment, Net of Deferred Fees (1)	2019			2019			2019
	(Dollars in thousands)
Balance, beginning of period	$	18,735,543		$	18,472,852		$	17,957,713
Additions:
Production		1,021,334			1,230,817			4,863,288
Disbursements		1,317,389			1,288,111			5,092,219
Total production and disbursements		2,338,723			2,518,928			9,955,507
Reductions:
Payoffs		(816,134	)		(1,390,883	)		(4,669,530	)
Paydowns		(1,406,475	)		(837,551	)		(4,262,977	)
Total payoffs and paydowns		(2,222,609	)		(2,228,434	)		(8,932,507	)
Sales		(43	)		(21,302	)		(76,335	)
Transfers to foreclosed assets		(83	)		-			(120	)
Charge-offs		(4,659	)		(6,501	)		(32,262	)
Transfers to loans held for sale		-			-			(25,124	)
Total reductions		(2,227,394	)		(2,256,237	)		(9,066,348	)
Net increase		111,329			262,691			889,159
Balance, end of period	$	18,846,872		$	18,735,543		$	18,846,872

Weighted average rate on production (2)		4.73	%		5.28	%		5.06	%

(1)

Includes direct financing leases but excludes equipment leased to others under operating leases.

(2)

The weighted average rate on production presents contractual rates on a tax equivalent basis and excludes amortized fees. Amortized fees added approximately 22 basis points to loan yields in 2019.

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Loans and leases held for investment, net of deferred fees, increased by $111.3 million, or 2.4% annualized, in the fourth quarter of 2019 to $18.8 billion at December 31, 2019. The net loan growth in the fourth quarter was primarily from the income producing and other residential real estate mortgage loan portfolio class and the residential real estate construction loan portfolio class. For the year ended December 31, 2019, loans and leases held for investment, net of deferred fees, increased by $889.2 million or 5.0%.

The following table presents the composition of loans and leases held for investment by loan portfolio segment and class, net of deferred fees, as of the dates indicated:

	December 31, 2019					September 30, 2019					December 31, 2018
			% of					% of					% of
Loan and Lease Portfolio	Amount		Total			Amount		Total			Amount		Total
	(In thousands)
Real estate mortgage:
Commercial	$	4,202,687		22	%	$	4,300,566		23	%	$	4,824,298		27	%
Income producing and other residential		3,770,060		20	%		3,596,358		19	%		3,093,843		17	%
Total real estate mortgage		7,972,747		42	%		7,896,924		42	%		7,918,141		44	%
Real estate construction and land:
Commercial		1,082,368		6	%		1,009,362		6	%		912,583		5	%
Residential		1,655,434		9	%		1,542,112		8	%		1,321,073		8	%
Total real estate construction and land		2,737,802		15	%		2,551,474		14	%		2,233,656		13	%
Total real estate		10,710,549		57	%		10,448,398		56	%		10,151,797		57	%
Commercial:
Asset-based		3,748,407		20	%		3,810,741		20	%		3,305,421		18	%
Venture capital		2,179,422		12	%		2,209,649		12	%		2,038,748		11	%
Other commercial		1,767,667		9	%		1,858,167		10	%		2,060,426		12	%
Total commercial		7,695,496		41	%		7,878,557		42	%		7,404,595		41	%
Consumer		440,827		2	%		408,588		2	%		401,321		2	%
Total loans and leases held for investment, net of deferred fees	$	18,846,872		100	%	$	18,735,543		100	%	$	17,957,713		100	%

Total unfunded loan commitments	$	8,183,158				$	7,790,796				$	7,528,248

Allowance for Credit Losses

The following tables present roll forwards of the allowance for credit losses for the periods indicated:

	Three Months Ended December 31, 2019
	Allowance for			Reserve for		Total
Allowance for Credit	Loan and			Unfunded Loan		Allowance for
Losses Rollforward	Lease Losses			Commitments		Credit Losses
	(In thousands)
Beginning balance	$	138,552		$	33,861	$	172,413
Charge-offs		(4,659	)		-		(4,659	)
Recoveries		3,892			-		3,892
Net charge-offs		(767	)		-		(767	)
Provision		1,000			2,000		3,000
Ending balance	$	138,785		$	35,861	$	174,646

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	Three Months Ended September 30, 2019
	Allowance for			Reserve for			Total
Allowance for Credit	Loan and			Unfunded Loan			Allowance for
Losses Rollforward	Lease Losses			Commitments			Credit Losses
	(In thousands)
Beginning balance	$	135,037		$	34,861		$	169,898
Charge-offs		(6,501	)		-			(6,501	)
Recoveries		2,016			-			2,016
Net charge-offs		(4,485	)		-			(4,485	)
Provision		8,000			(1,000	)		7,000
Ending balance	$	138,552		$	33,861		$	172,413

Allowance for Credit	Year Ended December 31,
Losses Rollforward	2019			2018
	(In thousands)
Beginning balance	$	169,333		$	168,091
Charge-offs		(32,262	)		(59,042	)
Recoveries		15,575			15,284
Net charge-offs		(16,687	)		(43,758	)
Provision		22,000			45,000
Ending balance	$	174,646		$	169,333

The allowance for credit losses as a percentage of loans and leases held for investment was 0.93% at December 31, 2019 and 0.92% at September 30, 2019.

Gross charge-offs for the fourth quarter of 2019 were $4.7 million and included $3.2 million for venture capital loans and $1.0 million for other commercial loans compared to gross charge-offs for the third quarter of 2019 of $6.5 million that included $4.4 million for venture capital loans and $1.7 million for other commercial loans.

Recoveries for the fourth quarter of 2019 were $3.9 million and included $1.8 million for other commercial loans, $0.9 million for asset-based loans, and $0.6 million for venture capital loans compared to recoveries for the third quarter of 2019 of $2.0 million that included $1.2 million for other commercial loans and $0.4 million for venture capital loans.

For the fourth quarter of 2019 and third quarter of 2019, annualized net charge-offs to average loans and leases were 0.02% and 0.10%.

For the full year 2019, net charge-offs were $16.7 million, of which $10.9 million related to one asset-based loan, while $1.2 million related to venture capital loans, a decrease from the full year 2018 net charge-offs of $43.8 million that included $24.2 million for venture capital loans. This resulted in a decrease in net charge-offs to average loans for the venture capital portfolio from 1.17% in 2018 to 0.06% in 2019.

For the full years 2019 and 2018, net charge-offs to average loans and leases declined to 0.09% from 0.26%.

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Deposits and Client Investment Funds

The following table presents the composition of our deposit portfolio as of the dates indicated:

	December 31, 2019					September 30, 2019					December 31, 2018
			% of					% of					% of
Deposit Composition	Amount		Total			Amount		Total			Amount		Total
	(Dollars in thousands)
Noninterest-bearing demand	$	7,243,298		38	%	$	7,441,185		38	%	$	7,888,915		42	%
Interest checking		3,753,978		19	%		3,645,660		18	%		2,842,463		15	%
Money market		4,690,420		24	%		4,870,344		25	%		5,043,871		27	%
Savings		499,591		3	%		514,075		3	%		571,422		3	%
Total core deposits		16,187,287		84	%		16,471,264		84	%		16,346,671		87	%
Non-core non-maturity deposits		496,407		3	%		479,732		2	%		518,192		3	%
Total non-maturity deposits		16,683,694		87	%		16,950,996		86	%		16,864,863		90	%
Time deposits $250,000 and under		2,065,733		11	%		2,282,976		12	%		1,593,453		8	%
Time deposits over $250,000		483,609		2	%		499,231		2	%		412,185		2	%
Total time deposits		2,549,342		13	%		2,782,207		14	%		2,005,638		10	%
Total deposits	$	19,233,036		100	%	$	19,733,203		100	%	$	18,870,501		100	%

At December 31, 2019, core deposits totaled $16.2 billion, or 84% of total deposits, including $7.2 billion of noninterest-bearing demand deposits, or 38% of total deposits. For the year ended December 31, 2019, total deposits increased by $362.5 million, or 2%, while core deposits decreased by $159.4 million, or 1%.

In addition to deposit products, we also offer alternative non-depository cash investment options for select clients; these alternatives include investments managed by Pacific Western Asset Management Inc. (“PWAM”), our registered investment advisor subsidiary, and third-party sweep products. Total off-balance sheet client investment funds at December 31, 2019 were $1.5 billion, of which $1.2 billion was managed by PWAM.

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CREDIT QUALITY

The following table presents loan and lease credit quality metrics as of the dates indicated:

	December 31,			September 30,			Increase
Credit Quality Metrics	2019			2019			(Decrease)
	(Dollars in thousands)
NPAs and Performing TDRs:
Nonaccrual loans and leases held for investment (1)	$	92,353		$	99,113		$	(6,760	)
Accruing loans contractually past due 90 days or more		-			-			-
Foreclosed assets, net		440			1,366			(926	)
Total nonperforming assets ("NPAs")	$	92,793		$	100,479		$	(7,686	)

Nonaccrual loans and leases held for investment to loans and leases held for investment		0.49	%		0.53	%
Nonperforming assets to loans and leases held for investment and foreclosed assets		0.49	%		0.54	%

Nonaccrual loans and leases held for investment (1)	$	92,353		$	99,113		$	(6,760	)
Performing TDRs held for investment		12,257			16,329			(4,072	)
Total impaired loans and leases	$	104,610		$	115,442		$	(10,832	)

Loan and Lease Credit Risk Ratings:
Pass	$	18,348,004		$	18,279,011		$	68,993
Special mention		322,956			267,925			55,031
Classified		175,912			188,607			(12,695	)
Total loans and leases held for investment, net of deferred fees	$	18,846,872		$	18,735,543		$	111,329

Classified loans and leases held for investment to loans and leases held for investment		0.93	%		1.01	%

Allowance for Credit Losses:
Allowance for credit losses	$	174,646		$	172,413		$	2,233
Provision for credit losses (for the quarter)	$	3,000		$	7,000		$	(4,000	)
Net charge-offs (for the quarter)	$	767		$	4,485		$	(3,718	)
Net charge-offs to average loans and leases (for the quarter)		0.02	%		0.10	%
Allowance for credit losses to loans and leases held for investment		0.93	%		0.92	%
Allowance for credit losses to nonaccrual loans and leases held for investment		189.1	%		174.0	%

(1)

Nonaccrual loans include guaranteed amounts of $17.5 million at December 31, 2019 and $15.4 million at September 30, 2019.

Nonaccrual, classified, and special mention loans and leases fluctuate from period to period as a result of loan repayments and our ongoing active portfolio monitoring.

During the fourth quarter of 2019, nonaccrual loans and leases decreased by $6.8 million, while classified loans and leases decreased by $12.7 million and special mention loans and leases increased by $55.0 million. There were no individually significant loan movements in the nonaccrual and classified loans and leases categories. The increase in special mention loans and leases in the fourth quarter was attributable to the downgrade of two security monitoring loans for $77.3 million, offset partially by the payoff of one security monitoring loan for $14.9 million and the net decrease in all other loans and leases of $7.4 million.

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The following table presents nonaccrual loans and leases and accruing loans and leases past due between 30 and 89 days by loan portfolio segment and class as of the dates indicated:

	Nonaccrual Loans and Leases										Accruing and
	December 31, 2019					September 30, 2019					30-89 Days Past Due
			% of					% of			December 31,		September 30,
			Loan					Loan			2019		2019
	Amount		Category			Amount		Category			Amount		Amount
	(Dollars in thousands)
Real estate mortgage:
Commercial	$	18,346		0.4	%	$	19,515		0.5	%	$	1,735	$	-
Income producing and other residential		2,478		0.1	%		2,868		0.1	%		2,094		3,750
Total real estate mortgage		20,824		0.3	%		22,383		0.3	%		3,829		3,750
Real estate construction and land:
Commercial		364		0.0	%		377		0.0	%		-		-
Residential		-		0.0	%		-		0.0	%		1,429		2,622
Total real estate construction and land		364		0.0	%		377		0.0	%		1,429		2,622
Commercial:
Asset-based		30,162		0.8	%		33,015		0.9	%		19		48
Venture capital		12,916		0.6	%		20,131		0.9	%		-		-
Other commercial		27,594		1.6	%		22,554		1.2	%		2,258		4,068
Total commercial		70,672		0.9	%		75,700		1.0	%		2,277		4,116
Consumer		493		0.1	%		653		0.2	%		1,006		795
Total held for investment	$	92,353		0.5	%	$	99,113		0.5	%	$	8,541	$	11,283

Page 11

STOCK REPURCHASE PROGRAM

During the fourth quarter of 2019, there were no stock repurchases. At December 31, 2019, the remaining amount that could be used to repurchase shares under the $225 million Stock Repurchase Program was $124.7 million.

ABOUT PACWEST BANCORP

PacWest Bancorp (“PacWest”) is a bank holding company with over $26 billion in assets with one wholly-owned banking subsidiary, Pacific Western Bank (the “Bank”). The Bank has 74 full-service branches located in California, one branch located in Durham, North Carolina, and one branch located in Denver, Colorado. Our Community Banking group provides lending and comprehensive deposit and treasury management services to small and medium-sized businesses conducted primarily through our California-based branch offices and Denver, Colorado branch office. We offer additional products and services through our National Lending and Venture Banking groups. National Lending provides asset-based, equipment, and real estate loans and treasury management services to established middle-market businesses on a national basis. Venture Banking offers a comprehensive suite of financial services focused on entrepreneurial or venture-backed businesses and their venture capital and private equity investors, with offices located in key innovative hubs across the United States. For more information about PacWest Bancorp or Pacific Western Bank, visit www.pacwest.com.

FORWARD LOOKING STATEMENTS

This communication contains certain forward-looking information about PacWest that is intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions and other statements that are not historical facts. Such statements are based on information available at the time of this communication and are based on current beliefs and expectations of the Company’s management and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors, including the risk factors described in documents filed by the Company with the Securities and Exchange Commission.

We are under no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Page 12

PACWEST BANCORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET

	December 31,			September 30,			December 31,
	2019			2019			2018
	(Dollars in thousands, except per share data)
ASSETS:
Cash and due from banks	$	172,585		$	252,596		$	175,830
Interest-earning deposits in financial institutions		465,039			483,405			209,937
Total cash and cash equivalents		637,624			736,001			385,767

Securities available-for-sale, at estimated fair value		3,797,187			3,817,348			4,009,431
Federal Home Loan Bank stock, at cost		40,924			26,865			32,103
Total investment securities		3,838,111			3,844,213			4,041,534

Loans held for sale		-			-			-

Gross loans and leases held for investment		18,910,740			18,796,011			18,026,365
Deferred fees, net		(63,868	)		(60,468	)		(68,652	)
Total loans and leases held for investment, net of deferred fees		18,846,872			18,735,543			17,957,713
Allowance for loan and lease losses		(138,785	)		(138,552	)		(132,472	)
Total loans and leases held for investment, net		18,708,087			18,596,991			17,825,241

Equipment leased to others under operating leases		324,084			295,854			292,677
Premises and equipment, net		38,585			37,926			34,661
Foreclosed assets, net		440			1,366			5,299
Goodwill		2,548,670			2,548,670			2,548,670
Core deposit and customer relationship intangibles, net		38,394			42,547			57,120
Other assets		636,811			621,059			540,385
Total assets	$	26,770,806		$	26,724,627		$	25,731,354

LIABILITIES:
Noninterest-bearing deposits	$	7,243,298		$	7,441,185		$	7,888,915
Interest-bearing deposits		11,989,738			12,292,018			10,981,586
Total deposits		19,233,036			19,733,203			18,870,501
Borrowings		1,759,008			1,253,031			1,371,114
Subordinated debentures		458,209			456,145			453,846
Accrued interest payable and other liabilities		365,856			362,140			210,305
Total liabilities		21,816,109			21,804,519			20,905,766
STOCKHOLDERS' EQUITY (1)		4,954,697			4,920,108			4,825,588
Total liabilities and stockholders’ equity	$	26,770,806		$	26,724,627		$	25,731,354

Book value per share	$	41.36		$	41.06		$	39.17
Tangible book value per share (2)	$	19.77		$	19.43		$	18.02
Shares outstanding		119,781,605			119,831,192			123,189,833

(1) Includes net unrealized gain (loss) on securities available-for-sale, net		$	78,658			$	95,887			$	(6,075	)
(2) Non-GAAP measure.

Page 13

PACWEST BANCORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF EARNINGS

	Three Months Ended								Year Ended
	December 31,			September 30,		December 31,			December 31,
	2019			2019		2018			2019			2018
	(Dollars in thousands, except per share data)
Interest income:
Loans and leases	$	263,402		$	275,978	$	272,522		$	1,097,845		$	1,047,969
Investment securities		28,135			28,806		29,690			115,569			111,619
Deposits in financial institutions		2,056			2,424		527			6,479			2,082
Total interest income		293,593			307,208		302,739			1,219,893			1,161,670

Interest expense:
Deposits		34,802			40,703		28,834			148,460			80,140
Borrowings		5,189			6,852		4,602			26,961			11,985
Subordinated debentures		6,983			7,417		7,538			29,843			28,631
Total interest expense		46,974			54,972		40,974			205,264			120,756

Net interest income		246,619			252,236		261,765			1,014,629			1,040,914
Provision for credit losses		3,000			7,000		12,000			22,000			45,000
Net interest income after provision for credit losses		243,619			245,236		249,765			992,629			995,914

Noninterest income:
Service charges on deposit accounts		3,611			3,525		4,091			14,637			16,509
Other commissions and fees		10,170			10,855		11,114			43,623			45,543
Leased equipment income		10,648			9,615		9,384			38,727			37,881
Gain on sale of loans and leases		23			765		-			1,114			4,675
Gain on sale of securities		184			908		786			25,445			8,176
Other income		2,540			7,761		8,151			19,016			35,851
Total noninterest income		27,176			33,429		33,526			142,562			148,635

Noninterest expense:
Compensation		74,637			71,424		69,299			285,862			282,568
Occupancy		14,541			14,089		13,356			57,407			53,223
Data processing		6,770			7,044		6,930			27,556			27,225
Other professional services		4,261			4,400		6,198			17,803			21,952
Insurance and assessments		4,168			4,100		4,202			16,404			20,705
Intangible asset amortization		4,153			4,833		4,986			18,726			22,506
Leased equipment depreciation		6,856			5,951		5,758			24,016			21,371
Foreclosed assets (income) expense, net		(3,446	)		8		(311	)		(3,555	)		(751	)
Acquisition, integration and reorganization costs		(269	)		-		970			349			1,770
Customer related expense		3,952			3,539		2,933			13,839			10,353
Loan expense		2,967			3,628		2,991			12,931			10,569
Other expense		5,138			7,793		11,923			30,913			39,741
Total noninterest expense		123,728			126,809		129,235			502,251			511,232

Earnings before income taxes		147,067			151,856		154,056			632,940			633,317
Income tax expense		29,186			41,830		39,015			164,304			167,978
Net earnings	$	117,881		$	110,026	$	115,041		$	468,636		$	465,339

Basic and diluted earnings per share	$	0.98		$	0.92	$	0.93		$	3.90		$	3.72
Dividends declared and paid per share	$	0.60		$	0.60	$	0.60		$	2.40		$	2.30

Page 14

PACWEST BANCORP AND SUBSIDIARIES

NET EARNINGS PER SHARE CALCULATIONS

	Three Months Ended									Year Ended
	December 31,			September 30,			December 31,			December 31,
	2019			2019			2018			2019			2018
	(In thousands, except per share data)
Basic Earnings Per Share:
Net earnings	$	117,881		$	110,026		$	115,041		$	468,636		$	465,339
Less: earnings allocated to unvested restricted stock (1)		(1,458	)		(1,369	)		(1,219	)		(5,182	)		(5,119	)
Net earnings allocated to common shares	$	116,423		$	108,657		$	113,822		$	463,454		$	460,220

Weighted-average basic shares and unvested restricted stock outstanding		119,804			119,831			123,238			120,468			125,100
Less: weighted-average unvested restricted stock outstanding		(1,566	)		(1,622	)		(1,426	)		(1,502	)		(1,460	)
Weighted-average basic shares outstanding		118,238			118,209			121,812			118,966			123,640

Basic earnings per share	$	0.98		$	0.92		$	0.93		$	3.90		$	3.72

Diluted Earnings Per Share:
Net earnings allocated to common shares	$	116,423		$	108,657		$	113,822		$	463,454		$	460,220

Weighted-average diluted shares outstanding		118,238			118,209			121,812			118,966			123,640

Diluted earnings per share	$	0.98		$	0.92		$	0.93		$	3.90		$	3.72

(1)

Represents cash dividends paid to holders of unvested stock, net of forfeitures, plus undistributed earnings amounts available to holders of unvested restricted stock, if any.

Page 15

PACWEST BANCORP AND SUBSIDIARIES

AVERAGE BALANCE SHEET AND YIELD ANALYSIS

	Three Months Ended
	December 31, 2019							September 30, 2019							December 31, 2018
			Interest		Average					Interest		Average					Interest		Average
	Average		Income/		Yield/			Average		Income/		Yield/			Average		Income/		Yield/
	Balance		Expense		Cost			Balance		Expense		Cost			Balance		Expense		Cost
	(Dollars in thousands)
Assets:
Loans and leases (1)(2)	$	18,470,583	$	263,783		5.67	%	$	18,539,281	$	276,309		5.91	%	$	17,275,343	$	272,824		6.27	%
Investment securities (3)		3,811,216		29,509		3.07	%		3,809,243		32,213		3.36	%		3,899,520		30,992		3.15	%
Deposits in financial institutions		498,068		2,056		1.64	%		445,152		2,424		2.16	%		94,500		527		2.21	%
Total interest-earning assets (1)		22,779,867		295,348		5.14	%		22,793,676		310,946		5.41	%		21,269,363		304,343		5.68	%
Other assets		3,600,872							3,612,927							3,515,099
Total assets	$	26,380,739						$	26,406,603						$	24,784,462

Liabilities and Stockholders' Equity:
Interest checking	$	3,731,696		10,031		1.07	%	$	3,598,698		11,942		1.32	%	$	2,785,702		7,932		1.13	%
Money market		5,117,553		12,063		0.94	%		5,121,856		14,807		1.15	%		5,107,468		13,621		1.06	%
Savings		509,497		204		0.16	%		515,649		218		0.17	%		597,259		273		0.18	%
Time		2,744,156		12,504		1.81	%		2,795,573		13,736		1.95	%		1,932,332		7,008		1.44	%
Total interest-bearing deposits		12,102,902		34,802		1.14	%		12,031,776		40,703		1.34	%		10,422,761		28,834		1.10	%
Borrowings		1,179,220		5,189		1.75	%		1,181,313		6,852		2.30	%		764,039		4,602		2.39	%
Subordinated debentures		456,997		6,983		6.06	%		456,011		7,417		6.45	%		452,998		7,538		6.60	%
Total interest-bearing liabilities		13,739,119		46,974		1.36	%		13,669,100		54,972		1.60	%		11,639,798		40,974		1.40	%
Noninterest-bearing demand deposits		7,338,888							7,487,555							8,163,699
Other liabilities		372,550							359,202							222,564
Total liabilities		21,450,557							21,515,857							20,026,061
Stockholders' equity		4,930,182							4,890,746							4,758,401
Total liabilities and stockholders' equity	$	26,380,739						$	26,406,603						$	24,784,462
Net interest income (1)			$	248,374						$	255,974						$	263,369
Net interest spread (1)						3.78	%						3.81	%						4.28	%
Net interest margin (1)						4.33	%						4.46	%						4.91	%

Total deposits (4)	$	19,441,790	$	34,802		0.71	%	$	19,519,331	$	40,703		0.83	%	$	18,586,460	$	28,834		0.62	%

(1)

Tax equivalent.

(2)

Includes discount accretion on acquired loans of $3.0 million, $2.6 million, and $6.9 million for the three months ended December 31, 2019, September 30, 2019, and December 31, 2018, respectively.

(3)

Includes tax-equivalent adjustments of $1.4 million, $3.4 million, and $1.3 million for the three months ended December 31, 2019, September 30, 2019, and December 31, 2018 related to tax-exempt income on investment securities. The federal statutory tax rate utilized was 21%.

(4)

Total deposits is the sum of total interest-bearing deposits and noninterest-bearing demand deposits. The cost of total deposits is calculated as annualized interest expense on total deposits divided by average total deposits.

Page 16

PACWEST BANCORP AND SUBSIDIARIES

FIVE QUARTER BALANCE SHEET

	December 31,			September 30,			June 30,			March 31,			December 31,
	2019			2019			2019			2019			2018
	(Dollars in thousands, except per share data)
ASSETS:
Cash and due from banks	$	172,585		$	252,596		$	185,075		$	224,758		$	175,830
Interest-earning deposits in financial institutions		465,039			483,405			422,663			332,124			209,937
Total cash and cash equivalents		637,624			736,001			607,738			556,882			385,767

Securities available-for-sale		3,797,187			3,817,348			3,807,244			3,994,708			4,009,431
Federal Home Loan Bank stock		40,924			26,865			43,146			29,430			32,103
Total investment securities		3,838,111			3,844,213			3,850,390			4,024,138			4,041,534

Loans held for sale		-			-			-			25,124			-

Gross loans and leases held for investment		18,910,740			18,796,011			18,532,740			18,371,295			18,026,365
Deferred fees, net		(63,868	)		(60,468	)		(59,888	)		(63,598	)		(68,652	)
Total loans and leases held for investment, net of deferred fees		18,846,872			18,735,543			18,472,852			18,307,697			17,957,713
Allowance for loan and lease losses		(138,785	)		(138,552	)		(135,037	)		(136,281	)		(132,472	)
Total loans and leases held for investment, net		18,708,087			18,596,991			18,337,815			18,171,416			17,825,241


Equipment leased to others under operating leases		324,084			295,854			300,668			293,853			292,677
Premises and equipment, net		38,585			37,926			38,162			37,783			34,661
Foreclosed assets, net		440			1,366			1,472			3,291			5,299
Goodwill		2,548,670			2,548,670			2,548,670			2,548,670			2,548,670
Core deposit and customer relationship intangibles, net		38,394			42,547			47,380			52,250			57,120
Other assets		636,811			621,059			612,119			610,731			540,385
Total assets	$	26,770,806		$	26,724,627		$	26,344,414		$	26,324,138		$	25,731,354

LIABILITIES:
Noninterest-bearing deposits	$	7,243,298		$	7,441,185		$	7,299,213		$	7,712,409		$	7,888,915
Interest-bearing deposits		11,989,738			12,292,018			11,506,543			11,573,518			10,981,586
Total deposits		19,233,036			19,733,203			18,805,756			19,285,927			18,870,501
Borrowings		1,759,008			1,253,031			1,913,059			1,481,087			1,371,114
Subordinated debentures		458,209			456,145			456,112			454,458			453,846
Accrued interest payable and other liabilities		365,856			362,140			317,477			311,684			210,305
Total liabilities		21,816,109			21,804,519			21,492,404			21,533,156			20,905,766
STOCKHOLDERS' EQUITY (1)		4,954,697			4,920,108			4,852,010			4,790,982			4,825,588
Total liabilities and stockholders’ equity	$	26,770,806		$	26,724,627		$	26,344,414		$	26,324,138		$	25,731,354

Book value per share	$	41.36		$	41.06		$	40.49		$	39.86		$	39.17
Tangible book value per share (2)	$	19.77		$	19.43		$	18.83		$	18.22		$	18.02
Shares outstanding		119,781,605			119,831,192			119,829,104			120,201,149			123,189,833

(1) Includes net unrealized gain (loss) on securities available-for-sale, net		$	78,658			$	95,887			$	73,066			$	37,258			$	(6,075	)
(2) Non-GAAP measure.

Page 17

PACWEST BANCORP AND SUBSIDIARIES

FIVE QUARTER STATEMENT OF EARNINGS

	Three Months Ended
	December 31,			September 30,		June 30,			March 31,		December 31,
	2019			2019		2019			2019		2018
	(Dollars in thousands, except per share data)
Interest income:
Loans and leases	$	263,402		$	275,978	$	284,236		$	274,229	$	272,522
Investment securities		28,135			28,806		28,948			29,680		29,690
Deposits in financial institutions		2,056			2,424		1,349			650		527
Total interest income		293,593			307,208		314,533			304,559		302,739

Interest expense:
Deposits		34,802			40,703		38,720			34,235		28,834
Borrowings		5,189			6,852		7,210			7,710		4,602
Subordinated debentures		6,983			7,417		7,705			7,738		7,538
Total interest expense		46,974			54,972		53,635			49,683		40,974

Net interest income		246,619			252,236		260,898			254,876		261,765
Provision for credit losses		3,000			7,000		8,000			4,000		12,000
Net interest income after provision for credit losses		243,619			245,236		252,898			250,876		249,765

Noninterest income:
Service charges on deposit accounts		3,611			3,525		3,771			3,730		4,091
Other commissions and fees		10,170			10,855		11,590			11,008		11,114
Leased equipment income		10,648			9,615		9,182			9,282		9,384
Gain on sale of loans and leases		23			765		326			-		-
Gain on sale of securities		184			908		22,192			2,161		786
Other income		2,540			7,761		3,832			4,883		8,151
Total noninterest income		27,176			33,429		50,893			31,064		33,526

Noninterest expense:
Compensation		74,637			71,424		68,956			70,845		69,299
Occupancy		14,541			14,089		14,457			14,320		13,356
Data processing		6,770			7,044		6,817			6,925		6,930
Other professional services		4,261			4,400		4,629			4,513		6,198
Insurance and assessments		4,168			4,100		4,098			4,038		4,202
Intangible asset amortization		4,153			4,833		4,870			4,870		4,986
Leased equipment depreciation		6,856			5,951		5,558			5,651		5,758
Foreclosed assets (income) expense, net		(3,446	)		8		(146	)		29		(311	)
Acquisition, integration and reorganization costs		(269	)		-		-			618		970
Customer related expense		3,952			3,539		3,405			2,943		2,933
Loan expense		2,967			3,628		3,451			2,885		2,991
Other expense		5,138			7,793		9,332			8,650		11,923
Total noninterest expense		123,728			126,809		125,427			126,287		129,235

Earnings before income taxes		147,067			151,856		178,364			155,653		154,056
Income tax expense		29,186			41,830		50,239			43,049		39,015
Net earnings	$	117,881		$	110,026	$	128,125		$	112,604	$	115,041

Basic and diluted earnings per share	$	0.98		$	0.92	$	1.07		$	0.92	$	0.93
Dividends declared and paid per share	$	0.60		$	0.60	$	0.60		$	0.60	$	0.60

Page 18

PACWEST BANCORP AND SUBSIDIARIES

FIVE QUARTER SELECTED FINANCIAL DATA

	At or For the Three Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2019			2019			2019			2019			2018
	(Dollars in thousands)
Performance Ratios:
Return on average assets (1)		1.77	%		1.65	%		1.99	%		1.77	%		1.84	%
Return on average equity (1)		9.49	%		8.93	%		10.66	%		9.48	%		9.59	%
Return on average tangible equity (1)(2)		19.98	%		19.01	%		23.15	%		20.64	%		21.23	%
Efficiency ratio		44.8	%		42.3	%		41.6	%		42.4	%		41.7	%
Noninterest expense as a percentage of average assets (1)		1.86	%		1.91	%		1.95	%		1.99	%		2.07	%

Average Yields/Costs (1):
Yield on:
Average loans and leases (3)		5.67	%		5.91	%		6.26	%		6.16	%		6.27	%
Average interest-earning assets (3)		5.14	%		5.41	%		5.68	%		5.60	%		5.68	%
Cost of:
Average interest-bearing deposits		1.14	%		1.34	%		1.35	%		1.24	%		1.10	%
Average total deposits		0.71	%		0.83	%		0.81	%		0.73	%		0.62	%
Average interest-bearing liabilities		1.36	%		1.60	%		1.64	%		1.57	%		1.40	%
Net interest spread (3)		3.78	%		3.81	%		4.04	%		4.03	%		4.28	%
Net interest margin (3)		4.33	%		4.46	%		4.72	%		4.69	%		4.91	%

Average Balances:
Assets:
Loans and leases, net of deferred fees	$	18,470,583		$	18,539,281		$	18,239,690		$	18,064,230		$	17,275,343
Interest-earning assets		22,779,867			22,793,676			22,258,828			22,144,711			21,269,363
Total assets		26,380,739			26,406,603			25,849,189			25,775,949			24,784,462
Liabilities:
Noninterest-bearing deposits		7,338,888			7,487,555			7,544,027			7,783,652			8,163,699
Interest-bearing deposits		12,102,902			12,031,776			11,545,785			11,156,773			10,422,761
Total deposits		19,441,790			19,519,331			19,089,812			18,940,425			18,586,460
Borrowings		1,179,220			1,181,313			1,142,223			1,218,319			764,039
Subordinated debentures		456,997			456,011			454,901			454,203			452,998
Interest-bearing liabilities		13,739,119			13,669,100			13,142,909			12,829,295			11,639,798
Stockholders' equity		4,930,182			4,890,746			4,818,889			4,815,965			4,758,401

(1)

Annualized.

(2)

Non-GAAP measure.

(3)

Tax equivalent.

Page 19

PACWEST BANCORP AND SUBSIDIARIES

FIVE QUARTER SELECTED FINANCIAL DATA

	At or For the Three Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2019			2019			2019			2019			2018
	(Dollars in thousands)
Credit Quality Ratios:
Nonaccrual loans and leases held for investment to loans and leases held for investment		0.49	%		0.53	%		0.44	%		0.48	%		0.44	%
Nonperforming assets to loans and leases held for investment and foreclosed assets		0.49	%		0.54	%		0.45	%		0.50	%		0.47	%
Classified loans and leases held for investment to loans and leases held for investment		0.93	%		1.01	%		1.03	%		1.04	%		1.32	%
Provision for credit losses (for the quarter) to average loans and leases held for investment (annualized)		0.06	%		0.15	%		0.18	%		0.09	%		0.28	%
Net charge-offs (for the quarter) to average loans and leases held for investment (annualized)		0.02	%		0.10	%		0.25	%		0.00	%		0.46	%
Trailing 12 months net charge-offs to average loans and leases held for investment		0.09	%		0.20	%		0.18	%		0.22	%		0.26	%
Allowance for credit losses to loans and leases held for investment		0.93	%		0.92	%		0.92	%		0.95	%		0.94	%
Allowance for credit losses to nonaccrual loans and leases held for investment		189.1	%		174.0	%		209.1	%		195.6	%		213.5	%

PacWest Bancorp Consolidated Capital:
Tier 1 leverage ratio (1)		9.74	%		9.50	%		9.49	%		9.38	%		10.13	%
Common equity tier 1 capital ratio (1)		9.78	%		9.55	%		9.53	%		9.48	%		10.01	%
Tier 1 capital ratio (1)		9.78	%		9.55	%		9.53	%		9.48	%		10.01	%
Total capital ratio (1)		12.41	%		12.16	%		12.18	%		12.15	%		12.72	%
Risk-weighted assets (1)	$	23,582,495		$	23,579,614		$	23,117,199		$	22,939,074		$	22,525,096

Equity to assets ratio		18.51	%		18.41	%		18.42	%		18.20	%		18.75	%
Tangible common equity ratio (2)		9.79	%		9.65	%		9.50	%		9.23	%		9.60	%
Book value per share	$	41.36		$	41.06		$	40.49		$	39.86		$	39.17
Tangible book value per share (2)	$	19.77		$	19.43		$	18.83		$	18.22		$	18.02

Pacific Western Bank Capital:
Tier 1 leverage ratio (1)		10.95	%		10.72	%		10.76	%		10.57	%		10.80	%
Common equity tier 1 capital ratio (1)		11.00	%		10.79	%		10.80	%		10.69	%		10.68	%
Tier 1 capital ratio (1)		11.00	%		10.79	%		10.80	%		10.69	%		10.68	%
Total capital ratio (1)		11.74	%		11.52	%		11.53	%		11.45	%		11.44	%

(1)

Capital information for December 31,2019 is preliminary.

(2)

Non-GAAP measure.

Page 20

GAAP TO NON-GAAP RECONCILIATIONS

This press release contains certain non-GAAP financial disclosures for: (1) return on average tangible equity, (2) tangible common equity ratio, and (3) tangible book value per share. The Company uses these non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance. In particular, the use of return on average tangible equity, tangible common equity ratio, and tangible book value per share is prevalent among banking regulators, investors and analysts. Accordingly, we disclose the non-GAAP measures in addition to the related GAAP measures of: (1) return on average equity, (2) equity to assets ratio, and (3) book value per share.

The tables below present the reconciliations of these GAAP financial measures to the related non-GAAP financial measures:

	Three Months Ended									Year Ended
	December 31,			September 30,			December 31,			December 31,
Return on Average Tangible Equity	2019			2019			2018			2019			2018
	(Dollars in thousands)
Net earnings	$	117,881		$	110,026		$	115,041		$	468,636		$	465,339

Average stockholders' equity	$	4,930,182		$	4,890,746		$	4,758,401		$	4,864,332		$	4,809,667
Less: Average intangible assets		2,589,217			2,593,925			2,608,497			2,596,389			2,616,820
Average tangible common equity	$	2,340,965		$	2,296,821		$	2,149,904		$	2,267,943		$	2,192,847

Return on average equity (1)		9.49	%		8.93	%		9.59	%		9.63	%		9.68	%
Return on average tangible equity (2)		19.98	%		19.01	%		21.23	%		20.66	%		21.22	%

(1)

Annualized net earnings divided by average stockholders' equity.

(2)

Annualized net earnings divided by average tangible common equity.

Tangible Common Equity Ratio/	December 31,			September 30,			June 30,			March 31,			December 31,
Tangible Book Value Per Share	2019			2019			2019			2019			2018
	(Dollars in thousands, except per share data)
Stockholders' equity	$	4,954,697		$	4,920,108		$	4,852,010		$	4,790,982		$	4,825,588
Less: Intangible assets		2,587,064			2,591,217			2,596,050			2,600,920			2,605,790
Tangible common equity	$	2,367,633		$	2,328,891		$	2,255,960		$	2,190,062		$	2,219,798

Total assets	$	26,770,806		$	26,724,627		$	26,344,414		$	26,324,138		$	25,731,354
Less: Intangible assets		2,587,064			2,591,217			2,596,050			2,600,920			2,605,790
Tangible assets	$	24,183,742		$	24,133,410		$	23,748,364		$	23,723,218		$	23,125,564

Equity to assets ratio		18.51	%		18.41	%		18.42	%		18.20	%		18.75	%
Tangible common equity ratio (1)		9.79	%		9.65	%		9.50	%		9.23	%		9.60	%

Book value per share	$	41.36		$	41.06		$	40.49		$	39.86		$	39.17
Tangible book value per share (2)	$	19.77		$	19.43		$	18.83		$	18.22		$	18.02
Shares outstanding		119,781,605			119,831,192			119,829,104			120,201,149			123,189,833

(1)

Tangible common equity divided by tangible assets.

(2)

Tangible common equity divided by shares outstanding.

Page 21