Attached files
| file | filename |
|---|---|
| EX-99.2 - EX-99.2 - PACWEST BANCORP | a18-17287_1ex99d2.htm |
| 8-K - 8-K - PACWEST BANCORP | a18-17287_18k.htm |
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 |
|
|
|
|
|
Contact: |
Donald D. Destino |
|
|
|
Executive Vice President |
|
|
|
Corporate Development and Investor Relations |
|
|
|
Relations |
|
|
Phone: |
310-887-8521 |
|
|
FOR IMMEDIATE RELEASE |
July 17, 2018 |
PACWEST BANCORP ANNOUNCES RESULTS
FOR THE SECOND QUARTER 2018
Highlights
· Net Earnings of $115.7 Million, or $0.92 Per Diluted Share
· Tax Equivalent Net Interest Margin of 5.18%
· New Loan and Lease Production of $1.3 Billion; $430 Million of Net Loan Growth
· Core Deposits at 87% of Total Deposits
Los Angeles, California . . . PacWest Bancorp (Nasdaq: PACW) today announced net earnings for the second quarter of 2018 of $115.7 million, or $0.92 per diluted share, compared to net earnings for the first quarter of 2018 of $118.3 million, or $0.93 per diluted share. The decrease in net earnings from the prior quarter was due primarily to a higher provision for credit losses offset partially by higher net interest income and higher noninterest income.
The provision for credit losses increased by $13.5 million in the second quarter of 2018 compared to the first quarter of 2018 due mainly to higher net charge-offs. Net interest income increased by $5.8 million in the second quarter of 2018 due mostly to a higher yield on average loans and leases and one more day in the current quarter, partially offset by an increase in the cost of average total deposits and borrowings.
Matt Wagner, President and CEO, commented, “While the credit provision was higher than expected, we were pleased with the increase in loan and lease production and net loan growth in the second quarter. The second quarter efficiency ratio improved to 39.8% as a result of higher revenues combined with lower operating expenses. Our second quarter results produced a return on assets of 1.93% and a return on tangible equity of 20.98%.”
Mr. Wagner continued, “Our second quarter tax equivalent NIM increased by seven basis points to 5.18%. While the NIM benefitted from the repricing of variable-rate loans and higher recapture of nonaccrual interest, this was partially offset by higher rates on deposits and higher balances and rates on borrowings. The growth in loans outstanding and unfunded commitments during the quarter should be a catalyst for increased interest income in the second half of the year.”
FINANCIAL HIGHLIGHTS
|
|
|
At or For the |
|
|
|
At or For the |
|
|
| ||||||||||
|
|
|
Three Months Ended |
|
|
|
Six Months Ended |
|
|
| ||||||||||
|
|
|
June 30, |
|
March 31, |
|
Increase |
|
June 30, |
|
Increase |
| ||||||||
|
Financial Highlights |
|
2018 |
|
2018 |
|
(Decrease) |
|
2018 |
|
2017 |
|
(Decrease) |
| ||||||
|
|
|
(Dollars in thousands, except per share data) |
| ||||||||||||||||
|
Net earnings |
|
$ |
115,735 |
|
$ |
118,276 |
|
$ |
(2,541 |
) |
$ |
234,011 |
|
$ |
172,315 |
|
$ |
61,696 |
|
|
Diluted earnings per share |
|
$ |
0.92 |
|
$ |
0.93 |
|
$ |
(0.01 |
) |
$ |
1.85 |
|
$ |
1.42 |
|
$ |
0.43 |
|
|
Return on average assets |
|
1.93 |
% |
1.99 |
% |
(0.06 |
) |
1.96 |
% |
1.59 |
% |
0.37 |
| ||||||
|
Return on average tangible equity (1) |
|
20.98 |
% |
21.08 |
% |
(0.10 |
) |
21.03 |
% |
15.00 |
% |
6.03 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Net interest margin (“NIM”) (tax equivalent) |
|
5.18 |
% |
5.11 |
% |
0.07 |
|
5.15 |
% |
5.19 |
% |
(0.04 |
) | ||||||
|
Yield on average loans and leases (tax equivalent) |
|
6.30 |
% |
6.11 |
% |
0.19 |
|
6.21 |
% |
6.01 |
% |
0.20 |
| ||||||
|
Cost of average total deposits |
|
0.37 |
% |
0.31 |
% |
0.06 |
|
0.34 |
% |
0.23 |
% |
0.11 |
| ||||||
|
Efficiency ratio |
|
39.8 |
% |
41.7 |
% |
(1.9 |
) |
40.7 |
% |
40.8 |
% |
(0.1 |
) | ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Total assets |
|
$ |
24,529,557 |
|
$ |
24,149,330 |
|
$ |
380,227 |
|
$ |
24,529,557 |
|
$ |
22,246,877 |
|
$ |
2,282,680 |
|
|
Loans and leases held for investment, net of deferred fees |
|
$ |
16,885,192 |
|
$ |
16,455,285 |
|
$ |
429,907 |
|
$ |
16,885,192 |
|
$ |
15,543,457 |
|
$ |
1,341,735 |
|
|
Noninterest-bearing deposits |
|
$ |
8,126,153 |
|
$ |
8,232,140 |
|
$ |
(105,987 |
) |
$ |
8,126,153 |
|
$ |
6,701,039 |
|
$ |
1,425,114 |
|
|
Core deposits |
|
$ |
15,586,238 |
|
$ |
15,661,529 |
|
$ |
(75,291 |
) |
$ |
15,586,238 |
|
$ |
13,217,574 |
|
$ |
2,368,664 |
|
|
Total deposits |
|
$ |
17,929,192 |
|
$ |
18,078,788 |
|
$ |
(149,596 |
) |
$ |
17,929,192 |
|
$ |
16,874,977 |
|
$ |
1,054,215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Noninterest-bearing deposits as percentage of total deposits |
|
45 |
% |
46 |
% |
(1 |
) |
45 |
% |
40 |
% |
5 |
| ||||||
|
Core deposits as percentage of total deposits |
|
87 |
% |
87 |
% |
— |
|
87 |
% |
78 |
% |
9 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Equity to assets ratio |
|
19.48 |
% |
20.16 |
% |
(0.68 |
) |
19.48 |
% |
20.50 |
% |
(1.02 |
) | ||||||
|
Tangible common equity ratio (1) |
|
9.86 |
% |
10.43 |
% |
(0.57 |
) |
9.86 |
% |
11.75 |
% |
(1.89 |
) | ||||||
|
Book value per share |
|
$ |
38.36 |
|
$ |
38.47 |
|
$ |
(0.11 |
) |
$ |
38.36 |
|
$ |
37.55 |
|
$ |
0.81 |
|
|
Tangible book value per share (1) |
|
$ |
17.35 |
|
$ |
17.75 |
|
$ |
(0.40 |
) |
$ |
17.35 |
|
$ |
19.40 |
|
$ |
(2.05 |
) |
(1) Non-GAAP measure.
INCOME STATEMENT HIGHLIGHTS
Net Interest Income
Net interest income increased by $5.8 million to $262.3 million for the second quarter of 2018 compared to $256.5 million for the first quarter of 2018 due mainly to a higher yield on average loans and leases and one additional day in the second quarter. The tax equivalent yield on average loans and leases was 6.30% for the second quarter of 2018 compared to 6.11% for the first quarter of 2018. The increase in the yield on average loans and leases was due principally to higher coupon interest (15 basis points) and higher recapture of nonaccrual interest (four basis points).
The tax equivalent NIM was 5.18% for the second quarter of 2018 compared to 5.11% for the first quarter of 2018. The increase in the NIM was due mainly to the higher yield on average loans and leases resulting from higher loan coupon interest and higher recapture of nonaccrual interest, which was partially offset by an increase of six basis points in the cost of average total deposits.
The cost of average total deposits increased to 0.37% for the second quarter of 2018 from 0.31% for the first quarter of 2018 due to higher rates paid for non-core deposits and pricing adjustments for select customers in light of recent market rate increases and the competitive market environment.
Provision for Credit Losses
A provision for credit losses of $17.5 million was recorded in the second quarter of 2018 compared to $4.0 million in the first quarter of 2018, which benefitted from higher than normal recoveries of $7.2 million. The higher provision for the second quarter of 2018 was due mainly to higher net charge-offs. The allowance for credit losses as a percentage of loans and leases held for investment decreased to 0.99% at June 30, 2018 from 1.02% at March 31, 2018.
The following table presents details of the provision for credit losses for the periods indicated:
|
|
|
Three Months Ended |
|
|
| |||||
|
|
|
June 30, |
|
March 31, |
|
Increase |
| |||
|
Provision for Credit Losses |
|
2018 |
|
2018 |
|
(Decrease) |
| |||
|
|
|
(In thousands) |
| |||||||
|
Addition to (reduction in) allowance for loan and lease losses |
|
$ |
15,000 |
|
$ |
(226 |
) |
$ |
15,226 |
|
|
Addition to (reduction in) reserve for unfunded loan commitments |
|
2,500 |
|
4,226 |
|
(1,726 |
) | |||
|
Total provision for credit losses |
|
$ |
17,500 |
|
$ |
4,000 |
|
$ |
13,500 |
|
Noninterest Income
Noninterest income increased by $1.1 million to $39.6 million for the second quarter of 2018 compared to $38.6 million for the first quarter of 2018 due mainly to increases in all income categories except for the gain on sale of securities and the gain on sale of loans and leases, as sale activities were minimal in the second quarter. The significant increase in other income was attributable to $7.5 million of gains on early lease terminations.
The following table presents details of noninterest income for the periods indicated:
|
|
|
Three Months Ended |
|
|
| |||||
|
|
|
June 30, |
|
March 31, |
|
Increase |
| |||
|
Noninterest Income |
|
2018 |
|
2018 |
|
(Decrease) |
| |||
|
|
|
(In thousands) |
| |||||||
|
Service charges on deposit accounts |
|
$ |
4,265 |
|
$ |
4,174 |
|
$ |
91 |
|
|
Other commissions and fees |
|
11,767 |
|
10,265 |
|
1,502 |
| |||
|
Leased equipment income |
|
9,790 |
|
9,587 |
|
203 |
| |||
|
Gain on sale of loans and leases |
|
106 |
|
4,569 |
|
(4,463 |
) | |||
|
Gain on sale of securities |
|
253 |
|
6,311 |
|
(6,058 |
) | |||
|
Other income: |
|
|
|
|
|
|
| |||
|
Dividends and gains on equity investments |
|
1,992 |
|
251 |
|
1,741 |
| |||
|
Warrant income |
|
1,225 |
|
248 |
|
977 |
| |||
|
Other |
|
10,240 |
|
3,154 |
|
7,086 |
| |||
|
Total noninterest income |
|
$ |
39,638 |
|
$ |
38,559 |
|
$ |
1,079 |
|
Noninterest Expense
Noninterest expense decreased by $0.9 million to $126.4 million for the second quarter of 2018 compared to $127.4 million for the first quarter of 2018 attributable primarily to a $1.1 million decrease in compensation expense due mainly to lower payroll taxes.
The following table presents details of noninterest expense for the periods indicated:
|
|
|
Three Months Ended |
|
|
| |||||
|
|
|
June 30, |
|
March 31, |
|
Increase |
| |||
|
Noninterest Expense |
|
2018 |
|
2018 |
|
(Decrease) |
| |||
|
|
|
(In thousands) |
| |||||||
|
Compensation |
|
$ |
69,913 |
|
$ |
71,023 |
|
$ |
(1,110 |
) |
|
Occupancy |
|
13,575 |
|
13,223 |
|
352 |
| |||
|
Data processing |
|
6,896 |
|
6,659 |
|
237 |
| |||
|
Other professional services |
|
5,257 |
|
4,439 |
|
818 |
| |||
|
Insurance and assessments |
|
5,330 |
|
5,727 |
|
(397 |
) | |||
|
Intangible asset amortization |
|
5,587 |
|
6,346 |
|
(759 |
) | |||
|
Leased equipment depreciation |
|
5,237 |
|
5,375 |
|
(138 |
) | |||
|
Foreclosed assets income, net |
|
(61 |
) |
(122 |
) |
61 |
| |||
|
Loan expense |
|
3,058 |
|
2,271 |
|
787 |
| |||
|
Other |
|
11,657 |
|
12,454 |
|
(797 |
) | |||
|
Total noninterest expense |
|
$ |
126,449 |
|
$ |
127,395 |
|
$ |
(946 |
) |
Income Taxes
The overall effective income tax rate was 26.8% for the second quarter of 2018 and 27.7% for the first quarter of 2018. The effective tax rate for the full year 2018 is estimated to be approximately 28%.
BALANCE SHEET HIGHLIGHTS
Loans and Leases
Loans and leases held for investment, net of deferred fees, increased by $429.9 million in the second quarter of 2018 to $16.9 billion at June 30, 2018. The net increase was driven mainly by new production of $1.3 billion and disbursements of $1.2 billion, offset partially by payoffs of $1.2 billion, paydowns of $829.1 million, and sales of $27.8 million.
The following table presents a roll forward of loans and leases held for investment, net of deferred fees, for the periods indicated:
|
|
|
Three Months |
|
Six Months |
| |||||
|
|
|
Ended |
|
Ended |
| |||||
|
Loans and Leases |
|
June 30, |
|
March 31, |
|
June 30, |
| |||
|
Held for Investment Roll Forward (1) |
|
2018 |
|
2018 |
|
2018 |
| |||
|
|
|
(Dollars in thousands) |
| |||||||
|
Balance, beginning of period |
|
$ |
16,455,285 |
|
$ |
16,972,743 |
|
$ |
16,972,743 |
|
|
New production |
|
1,256,559 |
|
744,918 |
|
2,001,477 |
| |||
|
Existing loans and leases: |
|
|
|
|
|
|
| |||
|
Payoffs |
|
(1,154,400 |
) |
(930,973 |
) |
(2,085,373 |
) | |||
|
Paydowns |
|
(829,119 |
) |
(936,002 |
) |
(1,765,121 |
) | |||
|
Disbursements |
|
1,203,940 |
|
747,376 |
|
1,951,316 |
| |||
|
Sales |
|
(27,779 |
) |
(130,624 |
) |
(158,403 |
) | |||
|
Transfers to foreclosed assets |
|
(1,059 |
) |
— |
|
(1,059 |
) | |||
|
Charge-offs |
|
(18,235 |
) |
(12,153 |
) |
(30,388 |
) | |||
|
Balance, end of period |
|
$ |
16,885,192 |
|
$ |
16,455,285 |
|
$ |
16,885,192 |
|
|
|
|
|
|
|
|
|
| |||
|
Weighted average rate on new production (2) |
|
5.00 |
% |
5.36 |
% |
5.13 |
% | |||
(1) Includes direct financing leases but excludes equipment leased to others under operating leases.
(2) The weighted average rate on new production presents contractual rates and does not include amortized fees. Amortized fees added approximately 31 basis points to loan yields in 2018.
The following table presents the composition of loans and leases held for investment, net of deferred fees, as of the dates indicated:
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
June 30, |
| ||||
|
Loan and Lease Portfolio |
|
2018 |
|
2018 |
|
2017 |
|
2017 |
| ||||
|
|
|
(In thousands) |
| ||||||||||
|
Real estate mortgage: |
|
|
|
|
|
|
|
|
| ||||
|
Commercial |
|
$ |
5,010,680 |
|
$ |
5,033,006 |
|
$ |
5,385,740 |
|
$ |
4,418,463 |
|
|
Residential |
|
2,555,695 |
|
2,521,237 |
|
2,466,894 |
|
1,719,269 |
| ||||
|
Total real estate mortgage |
|
7,566,375 |
|
7,554,243 |
|
7,852,634 |
|
6,137,732 |
| ||||
|
Real estate construction and land: |
|
|
|
|
|
|
|
|
| ||||
|
Commercial |
|
831,462 |
|
789,892 |
|
769,075 |
|
691,828 |
| ||||
|
Residential |
|
1,042,564 |
|
887,110 |
|
822,154 |
|
473,282 |
| ||||
|
Total real estate construction and land |
|
1,874,026 |
|
1,677,002 |
|
1,591,229 |
|
1,165,110 |
| ||||
|
Total real estate |
|
9,440,401 |
|
9,231,245 |
|
9,443,863 |
|
7,302,842 |
| ||||
|
Commercial: |
|
|
|
|
|
|
|
|
| ||||
|
Asset-based |
|
3,184,300 |
|
2,957,890 |
|
2,924,950 |
|
2,655,762 |
| ||||
|
Venture capital |
|
2,008,205 |
|
1,920,643 |
|
2,122,735 |
|
2,001,427 |
| ||||
|
Other commercial |
|
1,873,607 |
|
1,947,590 |
|
2,071,394 |
|
3,184,957 |
| ||||
|
Total commercial |
|
7,066,112 |
|
6,826,123 |
|
7,119,079 |
|
7,842,146 |
| ||||
|
Consumer |
|
378,679 |
|
397,917 |
|
409,801 |
|
398,469 |
| ||||
|
Total loans and leases held for investment, net of deferred fees (1) |
|
$ |
16,885,192 |
|
$ |
16,455,285 |
|
$ |
16,972,743 |
|
$ |
15,543,457 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Total unfunded loan commitments |
|
$ |
6,429,587 |
|
$ |
6,352,803 |
|
$ |
6,234,061 |
|
$ |
4,926,743 |
|
(1) Excludes loans held for sale carried at lower of cost or fair value at December 31, 2017 and June 30, 2017.
Allowance for Credit Losses
The following tables show roll forwards of the allowance for credit losses for the periods indicated:
|
|
|
Three Months Ended June 30, 2018 |
| |||||||
|
|
|
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 |
|
$ |
134,275 |
|
$ |
32,861 |
|
$ |
167,136 |
|
|
Charge-offs |
|
(18,235 |
) |
— |
|
(18,235 |
) | |||
|
Recoveries |
|
1,099 |
|
— |
|
1,099 |
| |||
|
Net charge-offs |
|
(17,136 |
) |
— |
|
(17,136 |
) | |||
|
Provision |
|
15,000 |
|
2,500 |
|
17,500 |
| |||
|
Ending balance |
|
$ |
132,139 |
|
$ |
35,361 |
|
$ |
167,500 |
|
|
|
|
Three Months Ended March 31, 2018 |
| |||||||
|
|
|
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 |
|
$ |
139,456 |
|
$ |
28,635 |
|
$ |
168,091 |
|
|
Charge-offs |
|
(12,153 |
) |
— |
|
(12,153 |
) | |||
|
Recoveries |
|
7,198 |
|
— |
|
7,198 |
| |||
|
Net charge-offs |
|
(4,955 |
) |
— |
|
(4,955 |
) | |||
|
Provision |
|
(226 |
) |
4,226 |
|
4,000 |
| |||
|
Ending balance |
|
$ |
134,275 |
|
$ |
32,861 |
|
$ |
167,136 |
|
Gross charge-offs for the second quarter of 2018 were $18.2 million and included $6.1 million for venture capital loans, $4.7 million for real estate mortgage loans, $4.4 million for other commercial loans and $2.9 million for asset-based loans. Gross charge-offs for the first quarter of 2018 were $12.2 million and included $6.8 million for other commercial loans, $2.6 million for real estate mortgage loans, and $2.3 million for venture capital loans. Four loans accounted for $14.2 million or 78 percent of the gross charge-offs in the second quarter of 2018. Recoveries in the second quarter of 2018 were $1.1 million and included $0.8 million for other commercial loans. Recoveries for the first quarter of 2018 were $7.2 million and included $4.6 million for venture capital loans.
The annualized ratio of net charge-offs to average loans was 0.41% for the second quarter of 2018 and 0.12% for the first quarter of 2018.
Deposits and Client Investment Funds
The following table presents the composition of our deposit portfolio as of the dates indicated:
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
June 30, |
| ||||
|
Deposit Category |
|
2018 |
|
2018 |
|
2017 |
|
2017 |
| ||||
|
|
|
(Dollars in thousands) |
| ||||||||||
|
Noninterest-bearing demand deposits |
|
$ |
8,126,153 |
|
$ |
8,232,140 |
|
$ |
8,508,044 |
|
$ |
6,701,039 |
|
|
Interest checking deposits |
|
2,184,785 |
|
2,076,152 |
|
2,226,885 |
|
1,762,016 |
| ||||
|
Money market deposits |
|
4,631,658 |
|
4,676,734 |
|
4,511,730 |
|
4,033,471 |
| ||||
|
Savings deposits |
|
643,642 |
|
676,503 |
|
690,353 |
|
721,048 |
| ||||
|
Total core deposits |
|
15,586,238 |
|
15,661,529 |
|
15,937,012 |
|
13,217,574 |
| ||||
|
Non-core non-maturity deposits |
|
607,388 |
|
585,399 |
|
863,202 |
|
1,329,324 |
| ||||
|
Total non-maturity deposits |
|
16,193,626 |
|
16,246,928 |
|
16,800,214 |
|
14,546,898 |
| ||||
|
Time deposits $250,000 and under |
|
1,394,117 |
|
1,482,118 |
|
1,709,980 |
|
1,940,872 |
| ||||
|
Time deposits over $250,000 |
|
341,449 |
|
349,742 |
|
355,342 |
|
387,207 |
| ||||
|
Total time deposits |
|
1,735,566 |
|
1,831,860 |
|
2,065,322 |
|
2,328,079 |
| ||||
|
Total deposits |
|
$ |
17,929,192 |
|
$ |
18,078,788 |
|
$ |
18,865,536 |
|
$ |
16,874,977 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Noninterest-bearing demand deposits as percentage of total deposits |
|
45 |
% |
46 |
% |
45 |
% |
40 |
% | ||||
|
Core deposits as percentage of total deposits |
|
87 |
% |
87 |
% |
85 |
% |
78 |
% | ||||
At June 30, 2018, core deposits totaled $15.6 billion, or 87% of total deposits, including $8.1 billion of noninterest-bearing demand deposits, or 45% of total deposits.
In addition to deposit products, we also offer alternative non-depository cash investment options for select clients; these alternatives include investments managed by Square 1 Asset Management, Inc. (“S1AM”), our registered investment advisor subsidiary, and third-party sweep products. Total off-balance sheet client investment funds at June 30, 2018 were $2.5 billion, of which $1.7 billion was managed by S1AM.
CREDIT QUALITY
The following table presents loan and lease credit quality metrics as of the dates indicated:
|
|
|
June 30, |
|
March 31, |
|
Increase |
| |||
|
Credit Quality Metrics |
|
2018 |
|
2018 |
|
(Decrease) |
| |||
|
|
|
(Dollars in thousands) |
| |||||||
|
Nonaccrual loans and leases held for investment (1) |
|
$ |
113,745 |
|
$ |
103,725 |
|
$ |
10,020 |
|
|
Accruing loan contractually past due 90 days or more |
|
— |
|
500 |
|
(500 |
) | |||
|
Foreclosed assets, net |
|
2,231 |
|
1,236 |
|
995 |
| |||
|
Total nonperforming assets |
|
$ |
115,976 |
|
$ |
105,461 |
|
$ |
10,515 |
|
|
|
|
|
|
|
|
|
| |||
|
Nonaccrual loans and leases held for investment (1) |
|
$ |
113,745 |
|
$ |
103,725 |
|
$ |
10,020 |
|
|
Performing troubled debt restructured loans held for investment |
|
58,148 |
|
60,173 |
|
(2,025 |
) | |||
|
Total impaired loans and leases |
|
$ |
171,893 |
|
$ |
163,898 |
|
$ |
7,995 |
|
|
|
|
|
|
|
|
|
| |||
|
Pass |
|
$ |
16,142,052 |
|
$ |
15,832,127 |
|
$ |
309,925 |
|
|
Special mention |
|
506,848 |
|
415,116 |
|
91,732 |
| |||
|
Classified |
|
236,292 |
|
208,042 |
|
28,250 |
| |||
|
Total loans and leases held for investment, net of deferred fees |
|
$ |
16,885,192 |
|
$ |
16,455,285 |
|
$ |
429,907 |
|
|
|
|
|
|
|
|
|
| |||
|
Allowance for credit losses |
|
$ |
167,500 |
|
$ |
167,136 |
|
$ |
364 |
|
|
Provision for credit losses (for the quarter) |
|
$ |
17,500 |
|
$ |
4,000 |
|
$ |
13,500 |
|
|
Net charge-offs (for the quarter) |
|
$ |
17,136 |
|
$ |
4,955 |
|
$ |
12,181 |
|
|
Net charge-offs to average loans and leases (for the quarter) |
|
0.41 |
% |
0.12 |
% |
|
| |||
|
Allowance for credit losses to loans and leases held for investment |
|
0.99 |
% |
1.02 |
% |
|
| |||
|
Allowance for credit losses to nonaccrual loans and leases held for investment |
|
147.3 |
% |
161.1 |
% |
|
| |||
|
Nonaccrual loans and leases held for investment to loans and leases held for investment |
|
0.67 |
% |
0.63 |
% |
|
| |||
|
Nonperforming assets to loans and leases held for investment and foreclosed assets |
|
0.69 |
% |
0.64 |
% |
|
| |||
|
Classified loans and leases held for investment to loans and leases held for investment |
|
1.40 |
% |
1.26 |
% |
|
| |||
(1) Nonaccrual loans include guaranteed amounts of $13.5 million and $13.4 million at June 30, 2018 and March 31, 2018.
Nonaccrual loans and leases increased by $10.0 million in the second quarter primarily due to a $14.0 million increase in nonaccrual commercial real estate loans and a $10.5 million increase in nonaccrual residential construction loans, partially offset by a $15.7 million decrease in nonaccrual other commercial loans. Classified loans and leases increased by $28.3 million in the second quarter primarily due to a $26.4 million increase in classified commercial real estate loans, a $22.9 million increase in classified venture capital loans, and a $10.5 million increase in classified residential construction loans, partially offset by a $16.0 million decrease in classified other commercial loans and a $14.5 million decrease in classified asset-based loans.
The following table presents nonaccrual loans and leases and accruing loans and leases past due between 30 and 89 days by portfolio segment and class as of the dates indicated:
|
|
|
Nonaccrual Loans and Leases |
|
Accruing and |
| ||||||||||||
|
|
|
June 30, 2018 |
|
March 31, 2018 |
|
30-89 Days Past Due |
| ||||||||||
|
|
|
|
|
% of |
|
|
|
% of |
|
June 30, |
|
March 31, |
| ||||
|
|
|
|
|
Loan |
|
|
|
Loan |
|
2018 |
|
2018 |
| ||||
|
|
|
Amount |
|
Category |
|
Amount |
|
Category |
|
Amount |
|
Amount |
| ||||
|
|
|
(Dollars in thousands) |
| ||||||||||||||
|
Real estate mortgage: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Commercial |
|
$ |
33,105 |
|
0.7 |
% |
$ |
19,116 |
|
0.4 |
% |
$ |
2,620 |
|
$ |
23,505 |
|
|
Residential |
|
3,527 |
|
0.1 |
% |
5,225 |
|
0.2 |
% |
2,983 |
|
708 |
| ||||
|
Total real estate mortgage |
|
36,632 |
|
0.5 |
% |
24,341 |
|
0.3 |
% |
5,603 |
|
24,213 |
| ||||
|
Real estate construction and land: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Commercial |
|
— |
|
0.0 |
% |
— |
|
0.0 |
% |
— |
|
— |
| ||||
|
Residential |
|
10,450 |
|
1.0 |
% |
— |
|
0.0 |
% |
5,969 |
|
2,605 |
| ||||
|
Total real estate construction and land |
|
10,450 |
|
0.6 |
% |
— |
|
0.0 |
% |
5,969 |
|
2,605 |
| ||||
|
Commercial: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Asset-based |
|
29,677 |
|
0.9 |
% |
32,838 |
|
1.1 |
% |
— |
|
— |
| ||||
|
Venture capital |
|
27,940 |
|
1.4 |
% |
21,861 |
|
1.1 |
% |
— |
|
— |
| ||||
|
Other commercial |
|
8,782 |
|
0.5 |
% |
24,434 |
|
1.3 |
% |
230 |
|
663 |
| ||||
|
Total commercial |
|
66,399 |
|
0.9 |
% |
79,133 |
|
1.2 |
% |
230 |
|
663 |
| ||||
|
Consumer |
|
264 |
|
0.1 |
% |
251 |
|
0.1 |
% |
75 |
|
1,000 |
| ||||
|
Total held for investment |
|
$ |
113,745 |
|
0.7 |
% |
$ |
103,725 |
|
0.6 |
% |
$ |
11,877 |
|
$ |
28,481 |
|
STOCK REPURCHASE PROGRAM
During the second quarter of 2018, we repurchased 2,286,881 shares at an average price of $53.36 and a total cost of $122.0 million. At June 30, 2018, the remaining amount that could be used to repurchase shares under the $350 million Stock Repurchase Program was $174.7 million.
ABOUT PACWEST BANCORP
PacWest Bancorp (“PacWest”) is a bank holding company with over $24 billion in assets with one wholly-owned banking subsidiary, Pacific Western Bank (the “Bank”). The Bank has 74 full-service branches located throughout the state of California and one branch in Durham, North Carolina. 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. We offer additional products and services through our National Lending and Venture Banking business groups. National Lending provides asset-based, equipment, real estate and security cash flow 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 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, visit www.pacwestbancorp.com, or to learn more about Pacific Western Bank, visit www.pacificwesternbank.com.
FORWARD LOOKING STATEMENTS
This communication contains forward-looking statements within the meaning of 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 as our future effective tax rate. 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.
PACWEST BANCORP AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
|
|
|
June 30, |
|
March 31, |
|
December 31, |
| |||
|
|
|
2018 |
|
2018 |
|
2017 |
| |||
|
|
|
(Dollars in thousands, except per share data) |
| |||||||
|
ASSETS: |
|
|
|
|
|
|
| |||
|
Cash and due from banks |
|
$ |
245,998 |
|
$ |
235,061 |
|
$ |
233,215 |
|
|
Interest-earning deposits in financial institutions |
|
205,567 |
|
312,735 |
|
165,222 |
| |||
|
Total cash and cash equivalents |
|
451,565 |
|
547,796 |
|
398,437 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Securities available-for-sale, at estimated fair value |
|
3,857,788 |
|
3,801,986 |
|
3,774,431 |
| |||
|
Federal Home Loan Bank stock, at cost |
|
26,271 |
|
17,250 |
|
20,790 |
| |||
|
Total investment securities |
|
3,884,059 |
|
3,819,236 |
|
3,795,221 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Loans held for sale |
|
— |
|
— |
|
481,100 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Gross loans and leases held for investment |
|
16,947,502 |
|
16,516,627 |
|
17,032,221 |
| |||
|
Deferred fees, net |
|
(62,310 |
) |
(61,342 |
) |
(59,478 |
) | |||
|
Loans and leases held for investment, net of deferred fees |
|
16,885,192 |
|
16,455,285 |
|
16,972,743 |
| |||
|
Allowance for loan and lease losses |
|
(132,139 |
) |
(134,275 |
) |
(139,456 |
) | |||
|
Total loans and leases held for investment, net |
|
16,753,053 |
|
16,321,010 |
|
16,833,287 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Equipment leased to others under operating leases |
|
266,576 |
|
280,648 |
|
284,631 |
| |||
|
Premises and equipment, net |
|
34,513 |
|
33,686 |
|
31,852 |
| |||
|
Foreclosed assets, net |
|
2,231 |
|
1,236 |
|
1,329 |
| |||
|
Deferred tax asset, net |
|
25,551 |
|
12,584 |
|
— |
| |||
|
Goodwill |
|
2,548,670 |
|
2,548,670 |
|
2,548,670 |
| |||
|
Core deposit and customer relationship intangibles, net |
|
67,693 |
|
73,280 |
|
79,626 |
| |||
|
Other assets |
|
495,646 |
|
511,184 |
|
540,723 |
| |||
|
Total assets |
|
$ |
24,529,557 |
|
$ |
24,149,330 |
|
$ |
24,994,876 |
|
|
|
|
|
|
|
|
|
| |||
|
LIABILITIES: |
|
|
|
|
|
|
| |||
|
Noninterest-bearing deposits |
|
$ |
8,126,153 |
|
$ |
8,232,140 |
|
$ |
8,508,044 |
|
|
Interest-bearing deposits |
|
9,803,039 |
|
9,846,648 |
|
10,357,492 |
| |||
|
Total deposits |
|
17,929,192 |
|
18,078,788 |
|
18,865,536 |
| |||
|
Borrowings |
|
1,187,226 |
|
575,284 |
|
467,342 |
| |||
|
Subordinated debentures |
|
451,878 |
|
452,223 |
|
462,437 |
| |||
|
Accrued interest payable and other liabilities |
|
183,302 |
|
175,545 |
|
221,963 |
| |||
|
Total liabilities |
|
19,751,598 |
|
19,281,840 |
|
20,017,278 |
| |||
|
STOCKHOLDERS’ EQUITY (1) |
|
4,777,959 |
|
4,867,490 |
|
4,977,598 |
| |||
|
Total liabilities and stockholders’ equity |
|
$ |
24,529,557 |
|
$ |
24,149,330 |
|
$ |
24,994,876 |
|
|
|
|
|
|
|
|
|
| |||
|
Book value per share |
|
$ |
38.36 |
|
$ |
38.47 |
|
$ |
38.65 |
|
|
Tangible book value per share (2) |
|
$ |
17.35 |
|
$ |
17.75 |
|
$ |
18.24 |
|
|
Shares outstanding |
|
124,567,950 |
|
126,537,871 |
|
128,782,878 |
| |||
|
(1) Includes net unrealized (loss) gain on securities available-for-sale, net |
|
$ |
(22,340) |
|
$ |
(11,936) |
|
$ |
31,171 |
|
|
(2) Non-GAAP measure. |
|
|
|
|
|
|
| |||
PACWEST BANCORP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
|
|
|
Three Months Ended |
|
Six Months Ended |
| |||||||||||
|
|
|
June 30, |
|
March 31, |
|
June 30, |
|
June 30, |
| |||||||
|
|
|
2018 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
| |||||
|
|
|
(Dollars in thousands, except per share data) |
|
|
|
|
| |||||||||
|
Interest income: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Loans and leases |
|
$ |
260,300 |
|
$ |
251,085 |
|
$ |
234,618 |
|
$ |
511,385 |
|
$ |
458,796 |
|
|
Investment securities |
|
27,730 |
|
26,138 |
|
24,689 |
|
53,868 |
|
47,728 |
| |||||
|
Deposits in financial institutions |
|
484 |
|
552 |
|
237 |
|
1,036 |
|
429 |
| |||||
|
Total interest income |
|
288,514 |
|
277,775 |
|
259,544 |
|
566,289 |
|
506,953 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Interest expense: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Deposits |
|
16,367 |
|
13,818 |
|
10,205 |
|
30,185 |
|
18,582 |
| |||||
|
Borrowings |
|
2,649 |
|
920 |
|
1,066 |
|
3,569 |
|
2,084 |
| |||||
|
Subordinated debentures |
|
7,166 |
|
6,537 |
|
5,800 |
|
13,703 |
|
11,362 |
| |||||
|
Total interest expense |
|
26,182 |
|
21,275 |
|
17,071 |
|
47,457 |
|
32,028 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Net interest income |
|
262,332 |
|
256,500 |
|
242,473 |
|
518,832 |
|
474,925 |
| |||||
|
Provision for credit losses |
|
17,500 |
|
4,000 |
|
11,499 |
|
21,500 |
|
36,227 |
| |||||
|
Net interest income after provision for credit losses |
|
244,832 |
|
252,500 |
|
230,974 |
|
497,332 |
|
438,698 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Service charges on deposit accounts |
|
4,265 |
|
4,174 |
|
3,510 |
|
8,439 |
|
7,268 |
| |||||
|
Other commissions and fees |
|
11,767 |
|
10,265 |
|
10,583 |
|
22,032 |
|
20,973 |
| |||||
|
Leased equipment income |
|
9,790 |
|
9,587 |
|
11,635 |
|
19,377 |
|
21,110 |
| |||||
|
Gain on sale of loans and leases |
|
106 |
|
4,569 |
|
649 |
|
4,675 |
|
1,361 |
| |||||
|
Gain on sale of securities |
|
253 |
|
6,311 |
|
1,651 |
|
6,564 |
|
1,552 |
| |||||
|
Other income |
|
13,457 |
|
3,653 |
|
7,254 |
|
17,110 |
|
18,132 |
| |||||
|
Total noninterest income |
|
39,638 |
|
38,559 |
|
35,282 |
|
78,197 |
|
70,396 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Compensation |
|
69,913 |
|
71,023 |
|
65,288 |
|
140,936 |
|
130,168 |
| |||||
|
Occupancy |
|
13,575 |
|
13,223 |
|
11,811 |
|
26,798 |
|
23,419 |
| |||||
|
Data processing |
|
6,896 |
|
6,659 |
|
6,337 |
|
13,555 |
|
13,352 |
| |||||
|
Other professional services |
|
5,257 |
|
4,439 |
|
3,976 |
|
9,696 |
|
7,354 |
| |||||
|
Insurance and assessments |
|
5,330 |
|
5,727 |
|
4,856 |
|
11,057 |
|
9,647 |
| |||||
|
Intangible asset amortization |
|
5,587 |
|
6,346 |
|
3,065 |
|
11,933 |
|
6,129 |
| |||||
|
Leased equipment depreciation |
|
5,237 |
|
5,375 |
|
5,232 |
|
10,612 |
|
10,857 |
| |||||
|
Foreclosed assets income, net |
|
(61 |
) |
(122 |
) |
(157 |
) |
(183 |
) |
(14 |
) | |||||
|
Acquisition, integration and reorganization costs |
|
— |
|
— |
|
1,700 |
|
— |
|
2,200 |
| |||||
|
Loan expense |
|
3,058 |
|
2,271 |
|
3,884 |
|
5,329 |
|
7,271 |
| |||||
|
Other expense |
|
11,657 |
|
12,454 |
|
11,715 |
|
24,111 |
|
23,868 |
| |||||
|
Total noninterest expense |
|
126,449 |
|
127,395 |
|
117,707 |
|
253,844 |
|
234,251 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Earnings before income taxes |
|
158,021 |
|
163,664 |
|
148,549 |
|
321,685 |
|
274,843 |
| |||||
|
Income tax expense |
|
(42,286 |
) |
(45,388 |
) |
(54,902 |
) |
(87,674 |
) |
(102,528 |
) | |||||
|
Net earnings |
|
$ |
115,735 |
|
$ |
118,276 |
|
$ |
93,647 |
|
$ |
234,011 |
|
$ |
172,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Basic and diluted earnings per share |
|
$ |
0.92 |
|
$ |
0.93 |
|
$ |
0.77 |
|
$ |
1.85 |
|
$ |
1.42 |
|
PACWEST BANCORP AND SUBSIDIARIES
NET EARNINGS PER SHARE CALCULATIONS
|
|
|
Three Months Ended |
|
Six Months Ended |
| |||||||||||
|
|
|
June 30, |
|
March 31, |
|
June 30, |
|
June 30, |
| |||||||
|
|
|
2018 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
| |||||
|
|
|
(In thousands, except per share data) |
| |||||||||||||
|
Basic Earnings Per Share: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Net earnings |
|
$ |
115,735 |
|
$ |
118,276 |
|
$ |
93,647 |
|
$ |
234,011 |
|
$ |
172,315 |
|
|
Less: earnings allocated to unvested restricted stock (1) |
|
(1,348 |
) |
(1,115 |
) |
(1,080 |
) |
(2,469 |
) |
(2,082 |
) | |||||
|
Net earnings allocated to common shares |
|
$ |
114,387 |
|
$ |
117,161 |
|
$ |
92,567 |
|
$ |
231,542 |
|
$ |
170,233 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Weighted-average basic shares and unvested restricted stock outstanding |
|
126,082 |
|
127,487 |
|
121,422 |
|
126,780 |
|
121,384 |
| |||||
|
Less: weighted-average unvested restricted stock outstanding |
|
(1,466 |
) |
(1,413 |
) |
(1,455 |
) |
(1,439 |
) |
(1,479 |
) | |||||
|
Weighted-average basic shares outstanding |
|
124,616 |
|
126,074 |
|
119,967 |
|
125,341 |
|
119,905 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Basic earnings per share |
|
$ |
0.92 |
|
$ |
0.93 |
|
$ |
0.77 |
|
$ |
1.85 |
|
$ |
1.42 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Diluted Earnings Per Share: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Net earnings allocated to common shares |
|
$ |
114,387 |
|
$ |
117,161 |
|
$ |
92,567 |
|
$ |
231,542 |
|
$ |
170,233 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Weighted-average basic shares outstanding |
|
124,616 |
|
126,074 |
|
119,967 |
|
125,341 |
|
119,905 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Diluted earnings per share |
|
$ |
0.92 |
|
$ |
0.93 |
|
$ |
0.77 |
|
$ |
1.85 |
|
$ |
1.42 |
|
(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.
PACWEST BANCORP AND SUBSIDIARIES
AVERAGE BALANCE SHEET AND YIELD ANALYSIS
|
|
|
Three Months Ended |
| ||||||||||||||||||||||
|
|
|
June 30, 2018 |
|
March 31, 2018 |
|
June 30, 2017 |
| ||||||||||||||||||
|
|
|
|
|
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) |
|
$ |
16,576,361 |
|
$ |
260,529 |
|
6.30 |
% |
$ |
16,682,124 |
|
$ |
251,260 |
|
6.11 |
% |
$ |
15,497,921 |
|
$ |
234,618 |
|
6.07 |
% |
|
Investment securities (3) |
|
3,803,590 |
|
29,967 |
|
3.16 |
% |
3,682,138 |
|
27,935 |
|
3.08 |
% |
3,436,785 |
|
29,538 |
|
3.45 |
% | ||||||
|
Deposits in financial institutions |
|
112,170 |
|
484 |
|
1.73 |
% |
150,674 |
|
552 |
|
1.49 |
% |
96,087 |
|
237 |
|
0.99 |
% | ||||||
|
Total interest-earning assets (4) |
|
20,492,121 |
|
290,980 |
|
5.70 |
% |
20,514,936 |
|
279,747 |
|
5.53 |
% |
19,030,793 |
|
264,393 |
|
5.57 |
% | ||||||
|
Other assets |
|
3,507,516 |
|
|
|
|
|
3,556,212 |
|
|
|
|
|
2,905,809 |
|
|
|
|
| ||||||
|
Total assets |
|
$ |
23,999,637 |
|
|
|
|
|
$ |
24,071,148 |
|
|
|
|
|
$ |
21,936,602 |
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Liabilities and Stockholders’ Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Interest checking |
|
$ |
2,243,767 |
|
3,932 |
|
0.70 |
% |
$ |
2,311,988 |
|
3,050 |
|
0.54 |
% |
$ |
1,709,699 |
|
1,697 |
|
0.40 |
% | |||
|
Money market |
|
5,013,119 |
|
8,072 |
|
0.65 |
% |
5,038,119 |
|
6,812 |
|
0.55 |
% |
4,907,865 |
|
4,993 |
|
0.41 |
% | ||||||
|
Savings |
|
656,310 |
|
245 |
|
0.15 |
% |
685,173 |
|
258 |
|
0.15 |
% |
708,389 |
|
296 |
|
0.17 |
% | ||||||
|
Time |
|
1,790,415 |
|
4,118 |
|
0.92 |
% |
1,923,963 |
|
3,698 |
|
0.78 |
% |
2,366,399 |
|
3,219 |
|
0.55 |
% | ||||||
|
Total interest-bearing deposits |
|
9,703,611 |
|
16,367 |
|
0.68 |
% |
9,959,243 |
|
13,818 |
|
0.56 |
% |
9,692,352 |
|
10,205 |
|
0.42 |
% | ||||||
|
Borrowings |
|
549,665 |
|
2,649 |
|
1.93 |
% |
239,293 |
|
920 |
|
1.56 |
% |
457,774 |
|
1,066 |
|
0.93 |
% | ||||||
|
Subordinated debentures |
|
451,973 |
|
7,166 |
|
6.36 |
% |
461,648 |
|
6,537 |
|
5.74 |
% |
443,756 |
|
5,800 |
|
5.24 |
% | ||||||
|
Total interest-bearing liabilities |
|
10,705,249 |
|
26,182 |
|
0.98 |
% |
10,660,184 |
|
21,275 |
|
0.81 |
% |
10,593,882 |
|
17,071 |
|
0.65 |
% | ||||||
|
Noninterest-bearing demand deposits |
|
8,253,413 |
|
|
|
|
|
8,311,104 |
|
|
|
|
|
6,646,349 |
|
|
|
|
| ||||||
|
Other liabilities |
|
208,495 |
|
|
|
|
|
198,653 |
|
|
|
|
|
151,095 |
|
|
|
|
| ||||||
|
Total liabilities |
|
19,167,157 |
|
|
|
|
|
19,169,941 |
|
|
|
|
|
17,391,326 |
|
|
|
|
| ||||||
|
Stockholders’ equity |
|
4,832,480 |
|
|
|
|
|
4,901,207 |
|
|
|
|
|
4,545,276 |
|
|
|
|
| ||||||
|
Total liabilities and stockholders’ equity |
|
$ |
23,999,637 |
|
|
|
|
|
$ |
24,071,148 |
|
|
|
|
|
$ |
21,936,602 |
|
|
|
|
| |||
|
Net interest income (4) |
|
|
|
$ |
264,798 |
|
|
|
|
|
$ |
258,472 |
|
|
|
|
|
$ |
247,322 |
|
|
| |||
|
Net interest spread (4) |
|
|
|
|
|
4.72 |
% |
|
|
|
|
4.72 |
% |
|
|
|
|
4.92 |
% | ||||||
|
Net interest margin (4) |
|
|
|
|
|
5.18 |
% |
|
|
|
|
5.11 |
% |
|
|
|
|
5.21 |
% | ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Total deposits (5) |
|
$ |
17,957,024 |
|
$ |
16,367 |
|
0.37 |
% |
$ |
18,270,347 |
|
$ |
13,818 |
|
0.31 |
% |
$ |
16,338,701 |
|
$ |
10,205 |
|
0.25 |
% |
|
Funding sources (6) |
|
$ |
18,958,662 |
|
$ |
26,182 |
|
0.55 |
% |
$ |
18,971,288 |
|
$ |
21,275 |
|
0.45 |
% |
$ |
17,240,231 |
|
$ |
17,071 |
|
0.40 |
% |
(1) Starting with the third quarter of 2017, includes tax-equivalent adjustments related to tax-exempt interest on loans.
(2) Includes discount accretion on acquired loans of $8.7 million, $7.6 million, and $7.5 million for the three months ended June 30, 2018, March 31, 2018, and June 30, 2017, respectively.
(3) Includes tax-equivalent adjustments of $2.1 million, $1.8 million, and $4.9 million for the three months ended June 30, 2018, March 31, 2018, and June 30, 2017 related to tax-exempt income on municipal securities. The federal statutory tax-rate utilized was 21% for the 2018 periods and 35% for the 2017 period.
(4) Tax equivalent.
(5) 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 deposits divided by average total deposits.
(6) Funding sources is the sum of total interest-bearing liabilities and noninterest-bearing demand deposits. The cost of funding sources is calculated as annualized total interest expense divided by average funding sources.
PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER BALANCE SHEET
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
| |||||
|
|
|
2018 |
|
2018 |
|
2017 |
|
2017 |
|
2017 |
| |||||
|
|
|
(Dollars in thousands, except per share data) |
| |||||||||||||
|
ASSETS: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Cash and due from banks |
|
$ |
245,998 |
|
$ |
235,061 |
|
$ |
233,215 |
|
$ |
147,579 |
|
$ |
180,330 |
|
|
Interest-earning deposits in financial institutions |
|
205,567 |
|
312,735 |
|
165,222 |
|
122,439 |
|
107,150 |
| |||||
|
Total cash and cash equivalents |
|
451,565 |
|
547,796 |
|
398,437 |
|
270,018 |
|
287,480 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Securities available-for-sale |
|
3,857,788 |
|
3,801,986 |
|
3,774,431 |
|
3,532,230 |
|
3,474,560 |
| |||||
|
Federal Home Loan Bank stock |
|
26,271 |
|
17,250 |
|
20,790 |
|
17,250 |
|
22,059 |
| |||||
|
Total investment securities |
|
3,884,059 |
|
3,819,236 |
|
3,795,221 |
|
3,549,480 |
|
3,496,619 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Loans held for sale |
|
— |
|
— |
|
481,100 |
|
— |
|
175,158 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Gross loans and leases held for investment |
|
16,947,502 |
|
16,516,627 |
|
17,032,221 |
|
15,756,285 |
|
15,609,180 |
| |||||
|
Deferred fees, net |
|
(62,310 |
) |
(61,342 |
) |
(59,478 |
) |
(65,768 |
) |
(65,723 |
) | |||||
|
Loans and leases held for investment, net of deferred fees |
|
16,885,192 |
|
16,455,285 |
|
16,972,743 |
|
15,690,517 |
|
15,543,457 |
| |||||
|
Allowance for loan and lease losses |
|
(132,139 |
) |
(134,275 |
) |
(139,456 |
) |
(159,606 |
) |
(145,958 |
) | |||||
|
Total loans and leases held for investment, net |
|
16,753,053 |
|
16,321,010 |
|
16,833,287 |
|
15,530,911 |
|
15,397,499 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Equipment leased to others under operating leases |
|
266,576 |
|
280,648 |
|
284,631 |
|
233,866 |
|
203,212 |
| |||||
|
Premises and equipment, net |
|
34,513 |
|
33,686 |
|
31,852 |
|
28,910 |
|
29,108 |
| |||||
|
Foreclosed assets, net |
|
2,231 |
|
1,236 |
|
1,329 |
|
11,630 |
|
13,278 |
| |||||
|
Deferred tax asset, net |
|
25,551 |
|
12,584 |
|
— |
|
65,321 |
|
70,354 |
| |||||
|
Goodwill |
|
2,548,670 |
|
2,548,670 |
|
2,548,670 |
|
2,173,949 |
|
2,173,949 |
| |||||
|
Core deposit and customer relationship intangibles, net |
|
67,693 |
|
73,280 |
|
79,626 |
|
27,188 |
|
30,237 |
| |||||
|
Other assets |
|
495,646 |
|
511,184 |
|
540,723 |
|
351,659 |
|
369,983 |
| |||||
|
Total assets |
|
$ |
24,529,557 |
|
$ |
24,149,330 |
|
$ |
24,994,876 |
|
$ |
22,242,932 |
|
$ |
22,246,877 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
LIABILITIES: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Noninterest-bearing deposits |
|
$ |
8,126,153 |
|
$ |
8,232,140 |
|
$ |
8,508,044 |
|
$ |
6,911,874 |
|
$ |
6,701,039 |
|
|
Interest-bearing deposits |
|
9,803,039 |
|
9,846,648 |
|
10,357,492 |
|
9,861,371 |
|
10,173,938 |
| |||||
|
Total deposits |
|
17,929,192 |
|
18,078,788 |
|
18,865,536 |
|
16,773,245 |
|
16,874,977 |
| |||||
|
Borrowings |
|
1,187,226 |
|
575,284 |
|
467,342 |
|
250,399 |
|
217,454 |
| |||||
|
Subordinated debentures |
|
451,878 |
|
452,223 |
|
462,437 |
|
448,126 |
|
445,743 |
| |||||
|
Accrued interest payable and other liabilities |
|
183,302 |
|
175,545 |
|
221,963 |
|
160,494 |
|
148,798 |
| |||||
|
Total liabilities |
|
19,751,598 |
|
19,281,840 |
|
20,017,278 |
|
17,632,264 |
|
17,686,972 |
| |||||
|
STOCKHOLDERS’ EQUITY (1) |
|
4,777,959 |
|
4,867,490 |
|
4,977,598 |
|
4,610,668 |
|
4,559,905 |
| |||||
|
Total liabilities and stockholders’ equity |
|
$ |
24,529,557 |
|
$ |
24,149,330 |
|
$ |
24,994,876 |
|
$ |
22,242,932 |
|
$ |
22,246,877 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Book value per share |
|
$ |
38.36 |
|
$ |
38.47 |
|
$ |
38.65 |
|
$ |
37.96 |
|
$ |
37.55 |
|
|
Tangible book value per share (2) |
|
$ |
17.35 |
|
$ |
17.75 |
|
$ |
18.24 |
|
$ |
19.84 |
|
$ |
19.40 |
|
|
Shares outstanding |
|
124,567,950 |
|
126,537,871 |
|
128,782,878 |
|
121,449,794 |
|
121,448,321 |
| |||||
|
(1) Includes net unrealized (loss) gain on securities available-for-sale, net |
|
$ |
(22,340 |
) |
$ |
(11,936 |
) |
$ |
31,171 |
|
$ |
33,613 |
|
$ |
29,729 |
|
|
(2) Non-GAAP measure. |
|
|
|
|
|
|
|
|
|
|
| |||||
PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER STATEMENT OF EARNINGS
|
|
|
Three Months Ended |
| |||||||||||||
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
| |||||
|
|
|
2018 |
|
2018 |
|
2017 |
|
2017 |
|
2017 |
| |||||
|
|
|
(Dollars in thousands, except per share data) |
| |||||||||||||
|
Interest income: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Loans and leases |
|
$ |
260,300 |
|
$ |
251,085 |
|
$ |
258,309 |
|
$ |
235,666 |
|
$ |
234,618 |
|
|
Investment securities |
|
27,730 |
|
26,138 |
|
25,712 |
|
24,762 |
|
24,689 |
| |||||
|
Deposits in financial institutions |
|
484 |
|
552 |
|
576 |
|
538 |
|
237 |
| |||||
|
Total interest income |
|
288,514 |
|
277,775 |
|
284,597 |
|
260,966 |
|
259,544 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Interest expense: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Deposits |
|
16,367 |
|
13,818 |
|
14,041 |
|
13,071 |
|
10,205 |
| |||||
|
Borrowings |
|
2,649 |
|
920 |
|
1,366 |
|
188 |
|
1,066 |
| |||||
|
Subordinated debentures |
|
7,166 |
|
6,537 |
|
6,234 |
|
6,017 |
|
5,800 |
| |||||
|
Total interest expense |
|
26,182 |
|
21,275 |
|
21,641 |
|
19,276 |
|
17,071 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Net interest income |
|
262,332 |
|
256,500 |
|
262,956 |
|
241,690 |
|
242,473 |
| |||||
|
Provision for credit losses |
|
17,500 |
|
4,000 |
|
6,406 |
|
15,119 |
|
11,499 |
| |||||
|
Net interest income after provision for credit losses |
|
244,832 |
|
252,500 |
|
256,550 |
|
226,571 |
|
230,974 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Service charges on deposit accounts |
|
4,265 |
|
4,174 |
|
4,574 |
|
3,465 |
|
3,510 |
| |||||
|
Other commissions and fees |
|
11,767 |
|
10,265 |
|
10,505 |
|
9,944 |
|
10,583 |
| |||||
|
Leased equipment income |
|
9,790 |
|
9,587 |
|
8,258 |
|
8,332 |
|
11,635 |
| |||||
|
Gain on sale of loans and leases |
|
106 |
|
4,569 |
|
1,988 |
|
2,848 |
|
649 |
| |||||
|
Gain (loss) on sale of securities |
|
253 |
|
6,311 |
|
(3,329 |
) |
1,236 |
|
1,651 |
| |||||
|
Other income |
|
13,457 |
|
3,653 |
|
4,799 |
|
5,557 |
|
7,254 |
| |||||
|
Total noninterest income |
|
39,638 |
|
38,559 |
|
26,795 |
|
31,382 |
|
35,282 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Compensation |
|
69,913 |
|
71,023 |
|
71,986 |
|
64,413 |
|
65,288 |
| |||||
|
Occupancy |
|
13,575 |
|
13,223 |
|
12,715 |
|
12,729 |
|
11,811 |
| |||||
|
Data processing |
|
6,896 |
|
6,659 |
|
6,764 |
|
6,459 |
|
6,337 |
| |||||
|
Other professional services |
|
5,257 |
|
4,439 |
|
5,786 |
|
4,213 |
|
3,976 |
| |||||
|
Insurance and assessments |
|
5,330 |
|
5,727 |
|
5,384 |
|
4,702 |
|
4,856 |
| |||||
|
Intangible asset amortization |
|
5,587 |
|
6,346 |
|
5,062 |
|
3,049 |
|
3,065 |
| |||||
|
Leased equipment depreciation |
|
5,237 |
|
5,375 |
|
5,048 |
|
4,862 |
|
5,232 |
| |||||
|
Foreclosed assets (income) expense, net |
|
(61 |
) |
(122 |
) |
(475 |
) |
2,191 |
|
(157 |
) | |||||
|
Acquisition, integration and reorganization costs |
|
— |
|
— |
|
16,085 |
|
1,450 |
|
1,700 |
| |||||
|
Loan expense |
|
3,058 |
|
2,271 |
|
3,140 |
|
3,421 |
|
3,884 |
| |||||
|
Other expense |
|
11,657 |
|
12,454 |
|
11,373 |
|
11,053 |
|
11,715 |
| |||||
|
Total noninterest expense |
|
126,449 |
|
127,395 |
|
142,868 |
|
118,542 |
|
117,707 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Earnings before income taxes |
|
158,021 |
|
163,664 |
|
140,477 |
|
139,411 |
|
148,549 |
| |||||
|
Income tax expense |
|
(42,286 |
) |
(45,388 |
) |
(56,440 |
) |
(37,945 |
) |
(54,902 |
) | |||||
|
Net earnings |
|
$ |
115,735 |
|
$ |
118,276 |
|
$ |
84,037 |
|
$ |
101,466 |
|
$ |
93,647 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Basic and diluted earnings per share |
|
$ |
0.92 |
|
$ |
0.93 |
|
$ |
0.66 |
|
$ |
0.84 |
|
$ |
0.77 |
|
PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER SELECTED FINANCIAL DATA
|
|
|
At or For the Three Months Ended |
| |||||||||||||
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
| |||||
|
|
|
2018 |
|
2018 |
|
2017 |
|
2017 |
|
2017 |
| |||||
|
|
|
(Dollars in thousands) |
| |||||||||||||
|
Performance Ratios: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Return on average assets (1) |
|
1.93 |
% |
1.99 |
% |
1.34 |
% |
1.82 |
% |
1.71 |
% | |||||
|
Return on average equity (1) |
|
9.61 |
% |
9.79 |
% |
6.78 |
% |
8.77 |
% |
8.26 |
% | |||||
|
Return on average tangible equity (1)(2) |
|
20.98 |
% |
21.08 |
% |
13.75 |
% |
16.85 |
% |
16.06 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Yield on average loans and leases (1)(3) |
|
6.30 |
% |
6.11 |
% |
5.89 |
% |
6.01 |
% |
6.07 |
% | |||||
|
Yield on average interest-earning assets (1)(4) |
|
5.70 |
% |
5.53 |
% |
5.37 |
% |
5.48 |
% |
5.57 |
% | |||||
|
Cost of average total deposits (1) |
|
0.37 |
% |
0.31 |
% |
0.30 |
% |
0.31 |
% |
0.25 |
% | |||||
|
Cost of average time deposits (1) |
|
0.92 |
% |
0.78 |
% |
0.68 |
% |
0.62 |
% |
0.55 |
% | |||||
|
Cost of average interest-bearing liabilities (1) |
|
0.98 |
% |
0.81 |
% |
0.75 |
% |
0.73 |
% |
0.65 |
% | |||||
|
Cost of average funding sources (1) |
|
0.55 |
% |
0.45 |
% |
0.44 |
% |
0.44 |
% |
0.40 |
% | |||||
|
Net interest spread (1)(4) |
|
4.72 |
% |
4.72 |
% |
4.62 |
% |
4.75 |
% |
4.92 |
% | |||||
|
Net interest margin (1)(4) |
|
5.18 |
% |
5.11 |
% |
4.97 |
% |
5.08 |
% |
5.21 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Efficiency ratio |
|
39.8 |
% |
41.7 |
% |
41.0 |
% |
40.4 |
% |
40.3 |
% | |||||
|
Noninterest expense as a percentage of average assets (1) |
|
2.11 |
% |
2.15 |
% |
2.29 |
% |
2.12 |
% |
2.15 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Average Balances: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Loans and leases, net of deferred fees |
|
$ |
16,576,361 |
|
$ |
16,682,124 |
|
$ |
17,426,873 |
|
$ |
15,575,030 |
|
$ |
15,497,921 |
|
|
Interest-earning assets |
|
20,492,121 |
|
20,514,936 |
|
21,414,180 |
|
19,257,441 |
|
19,030,793 |
| |||||
|
Total assets |
|
23,999,637 |
|
24,071,148 |
|
24,789,836 |
|
22,137,874 |
|
21,936,602 |
| |||||
|
Noninterest-bearing deposits |
|
8,253,413 |
|
8,311,104 |
|
8,190,134 |
|
6,858,816 |
|
6,646,349 |
| |||||
|
Interest-bearing deposits |
|
9,703,611 |
|
9,959,243 |
|
10,578,568 |
|
10,024,554 |
|
9,692,352 |
| |||||
|
Total deposits |
|
17,957,024 |
|
18,270,347 |
|
18,768,702 |
|
16,883,370 |
|
16,338,701 |
| |||||
|
Borrowings and subordinated debentures |
|
1,001,638 |
|
700,941 |
|
903,375 |
|
508,083 |
|
901,530 |
| |||||
|
Interest-bearing liabilities |
|
10,705,249 |
|
10,660,184 |
|
11,481,943 |
|
10,532,637 |
|
10,593,882 |
| |||||
|
Funding sources |
|
18,958,662 |
|
18,971,288 |
|
19,672,077 |
|
17,391,453 |
|
17,240,231 |
| |||||
|
Stockholders’ equity |
|
4,832,480 |
|
4,901,207 |
|
4,920,498 |
|
4,592,489 |
|
4,545,276 |
| |||||
(1) Annualized.
(2) Non-GAAP measure.
(3) Tax equivalent starting with the third quarter of 2017.
(4) Tax equivalent.
PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER SELECTED FINANCIAL DATA
|
|
|
At or For the Three Months Ended |
| |||||||||||||
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
| |||||
|
|
|
2018 |
|
2018 |
|
2017 |
|
2017 |
|
2017 |
| |||||
|
|
|
(Dollars in thousands) |
| |||||||||||||
|
Credit Quality Ratios (1): |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Allowance for credit losses to loans and leases held for investment |
|
0.99 |
% |
1.02 |
% |
0.96 |
% |
1.11 |
% |
1.03 |
% | |||||
|
Allowance for credit losses to nonaccrual loans and leases held for investment |
|
147.3 |
% |
161.1 |
% |
103.8 |
% |
110.1 |
% |
92.2 |
% | |||||
|
Nonaccrual loans and leases held for investment to loans and leases held for investment |
|
0.67 |
% |
0.63 |
% |
0.92 |
% |
1.01 |
% |
1.12 |
% | |||||
|
Nonperforming assets to loans and leases held for investment and foreclosed assets |
|
0.69 |
% |
0.64 |
% |
0.93 |
% |
1.08 |
% |
1.20 |
% | |||||
|
Nonperforming assets to total assets |
|
0.47 |
% |
0.44 |
% |
0.63 |
% |
0.76 |
% |
0.84 |
% | |||||
|
Trailing 12 months net charge-offs to average loans and leases held for investment |
|
0.28 |
% |
0.31 |
% |
0.40 |
% |
0.35 |
% |
0.37 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
PacWest Bancorp Consolidated Capital: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Tier 1 leverage ratio (2) |
|
10.33 |
% |
10.66 |
% |
10.66 |
% |
12.02 |
% |
11.90 |
% | |||||
|
Common equity tier 1 capital ratio (2) |
|
10.61 |
% |
11.16 |
% |
10.91 |
% |
12.52 |
% |
12.28 |
% | |||||
|
Tier 1 capital ratio (2) |
|
10.61 |
% |
11.16 |
% |
10.91 |
% |
12.52 |
% |
12.28 |
% | |||||
|
Total capital ratio (2) |
|
13.51 |
% |
14.11 |
% |
13.75 |
% |
15.74 |
% |
15.42 |
% | |||||
|
Risk-weighted assets (2) |
|
$ |
20,887,678 |
|
$ |
20,523,487 |
|
$ |
21,657,591 |
|
$ |
19,086,798 |
|
$ |
19,084,823 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Equity to assets ratio |
|
19.48 |
% |
20.16 |
% |
19.91 |
% |
20.73 |
% |
20.50 |
% | |||||
|
Tangible common equity ratio (3) |
|
9.86 |
% |
10.43 |
% |
10.50 |
% |
12.02 |
% |
11.75 |
% | |||||
|
Book value per share |
|
$ |
38.36 |
|
$ |
38.47 |
|
$ |
38.65 |
|
$ |
37.96 |
|
$ |
37.55 |
|
|
Tangible book value per share (3) |
|
$ |
17.35 |
|
$ |
17.75 |
|
$ |
18.24 |
|
$ |
19.84 |
|
$ |
19.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Pacific Western Bank Capital: |
|
|
|
|
|
|
|
|
|
|
| |||||
|
Tier 1 leverage ratio (2) |
|
11.11 |
% |
11.33 |
% |
11.75 |
% |
11.46 |
% |
11.41 |
% | |||||
|
Common equity tier 1 capital ratio (2) |
|
11.40 |
% |
11.86 |
% |
11.91 |
% |
11.95 |
% |
11.79 |
% | |||||
|
Tier 1 capital ratio (2) |
|
11.40 |
% |
11.86 |
% |
11.91 |
% |
11.95 |
% |
11.79 |
% | |||||
|
Total capital ratio (2) |
|
12.21 |
% |
12.67 |
% |
12.69 |
% |
12.89 |
% |
12.66 |
% | |||||
(1) Ratios related to 2018 periods are for total loans and leases. Ratios related to 2017 periods are for Non-PCI loans and leases.
(2) Capital information for June 30, 2018 is preliminary.
(3) Non-GAAP measure.
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 |
|
Six Months Ended |
| |||||||||||
|
|
|
June 30, |
|
March 31, |
|
June 30, |
|
June 30, |
| |||||||
|
Return on Average Tangible Equity |
|
2018 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
| |||||
|
|
|
(Dollars in thousands) |
| |||||||||||||
|
Net earnings |
|
$ |
115,735 |
|
$ |
118,276 |
|
$ |
93,647 |
|
$ |
234,011 |
|
$ |
172,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Average stockholders’ equity |
|
$ |
4,832,480 |
|
$ |
4,901,207 |
|
$ |
4,545,276 |
|
$ |
4,866,654 |
|
$ |
4,524,591 |
|
|
Less: Average intangible assets |
|
2,619,351 |
|
2,625,593 |
|
2,205,814 |
|
2,622,455 |
|
2,207,454 |
| |||||
|
Average tangible common equity |
|
$ |
2,213,129 |
|
$ |
2,275,614 |
|
$ |
2,339,462 |
|
$ |
2,244,199 |
|
$ |
2,317,137 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Return on average equity (1) |
|
9.61 |
% |
9.79 |
% |
8.26 |
% |
9.70 |
% |
7.68 |
% | |||||
|
Return on average tangible equity (2) |
|
20.98 |
% |
21.08 |
% |
16.06 |
% |
21.03 |
% |
15.00 |
% | |||||
(1) Annualized net earnings divided by average stockholders’ equity.
(2) Annualized net earnings divided by average tangible common equity.
|
Tangible Common Equity Ratio/ |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
| |||||
|
Tangible Book Value Per Share |
|
2018 |
|
2018 |
|
2017 |
|
2017 |
|
2017 |
| |||||
|
|
|
(Dollars in thousands, except per share data) |
| |||||||||||||
|
Stockholders’ equity |
|
$ |
4,777,959 |
|
$ |
4,867,490 |
|
$ |
4,977,598 |
|
$ |
4,610,668 |
|
$ |
4,559,905 |
|
|
Less: Intangible assets |
|
2,616,363 |
|
2,621,950 |
|
2,628,296 |
|
2,201,137 |
|
2,204,186 |
| |||||
|
Tangible common equity |
|
$ |
2,161,596 |
|
$ |
2,245,540 |
|
$ |
2,349,302 |
|
$ |
2,409,531 |
|
$ |
2,355,719 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Total assets |
|
$ |
24,529,557 |
|
$ |
24,149,330 |
|
$ |
24,994,876 |
|
$ |
22,242,932 |
|
$ |
22,246,877 |
|
|
Less: Intangible assets |
|
2,616,363 |
|
2,621,950 |
|
2,628,296 |
|
2,201,137 |
|
2,204,186 |
| |||||
|
Tangible assets |
|
$ |
21,913,194 |
|
$ |
21,527,380 |
|
$ |
22,366,580 |
|
$ |
20,041,795 |
|
$ |
20,042,691 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Equity to assets ratio |
|
19.48 |
% |
20.16 |
% |
19.91 |
% |
20.73 |
% |
20.50 |
% | |||||
|
Tangible common equity ratio (1) |
|
9.86 |
% |
10.43 |
% |
10.50 |
% |
12.02 |
% |
11.75 |
% | |||||
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
Book value per share |
|
$ |
38.36 |
|
$ |
38.47 |
|
$ |
38.65 |
|
$ |
37.96 |
|
$ |
37.55 |
|
|
Tangible book value per share (2) |
|
$ |
17.35 |
|
$ |
17.75 |
|
$ |
18.24 |
|
$ |
19.84 |
|
$ |
19.40 |
|
|
Shares outstanding |
|
124,567,950 |
|
126,537,871 |
|
128,782,878 |
|
121,449,794 |
|
121,448,321 |
| |||||
(1) Tangible common equity divided by tangible assets.
(2) Tangible common equity divided by shares outstanding.