Other Assets

3 Months Ended

Mar. 31, 2022

OTHER ASSETS

The following table presents the detail of our other assets as of the dates indicated:


	March 31,		December 31,
Other Assets	2022		2021
	(In thousands)
LIHTC investments	$	298,233	$	297,746
Cash surrender value of BOLI	204,938		203,836
Deferred tax asset, net (1)	141,008		—
Operating lease ROU assets, net (2)	130,267		123,225
Interest receivable	120,997		120,329
Equity investments without readily determinable fair values	63,279		62,975
SBIC investments	50,558		46,861
Prepaid expenses	26,502		27,632
Taxes receivable	10,591		36,011
Equity investments with readily determinable fair values	8,814		28,578
Equity warrants (3)	3,771		3,555

Other receivables/assets	149,303		133,244
Total other assets	$	1,208,261	$	1,083,992

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(1) At December 31, 2021, this was a net deferred tax liability of $19.6 million.

(2) See Note 8. Leases for further details regarding the operating lease ROU assets.

(3) See Note 10. Derivatives for information regarding equity warrants.

Stock-Based Compensation

STOCK-BASED COMPENSATION

At the annual meeting of stockholders held on May 11, 2021, the Company's stockholders approved the Amended and Restated PacWest Bancorp 2017 Stock Incentive Plan (the “Amended and Restated 2017 Plan”). The Company’s Amended and Restated 2017 Plan permits stock-based compensation awards to officers, directors, employees, and consultants and will remain in effect until December 31, 2026. The Amended and Restated 2017 Plan authorizes grants of stock-based compensation instruments to issue up to 6,650,000 shares. As of March 31, 2022, there were 2,905,529 shares available for grant under the Amended and Restated 2017 Plan.

Restricted Stock

Restricted stock amortization totaled $7.6 million and $6.4 million for the three months ended March 31, 2022 and 2021. Such amounts are included in "Compensation expense" on the condensed consolidated statements of earnings. The amount of unrecognized compensation expense related to unvested TRSAs and PRSUs as of March 31, 2022 totaled $67.3 million.

Time-Based Restricted Stock Awards

At March 31, 2022, there were 2,154,646 shares of unvested TRSAs outstanding. TRSAs generally vest ratably over a service period of three or four years from the date of the grant or immediately upon death of an employee. Compensation expense related to TRSAs is based on the fair value of the underlying award on the grant date and is recognized over the vesting period using the straight-line method.

Performance-Based Restricted Stock Units

At March 31, 2022, there were 505,647 units of unvested PRSUs that have been granted. The PRSUs will vest only if performance goals with respect to certain financial metrics are met over a three-year performance period. The shares underlying the PRSUs are not considered issued and outstanding until they vest. PRSUs are granted and initially expensed based on a target number. The number of shares that will ultimately vest based on actual performance will range from zero to a maximum of either 150% or 200% of target.

Compensation expense related to PRSUs is based on the fair value of the underlying award on the grant date and is amortized over the vesting period using the straight-line method unless it is determined that: (1) attainment of the financial metrics is less than probable, in which case a portion or all of the amortization is suspended, or (2) attainment of the financial metrics is improbable, in which case a portion or all of the previously recognized amortization is reversed and also suspended. If it is determined that attainment of a financial measure higher than target is probable, the amortization will increase to up to 150% or 200% of the target amortization amount. Annual PRSU expense may vary during the three-year performance period based upon changes in management's estimate of the number of shares that may ultimately vest. In the case where the performance target for the PRSU is based on a market condition (such as total shareholder return), the amortization is neither reversed nor suspended if it is subsequently determined that the attainment of the performance target is less than probable or improbable and the employee continues to meet the service requirement of the award.