Significant Items

  • Net Loss of $1.43 Billion, or a Loss of $12.23 Per Diluted Share
  • Recorded Goodwill Impairment of $1.47 Billion
  • Excluding Goodwill Impairment, Net Earnings of $36.9 Million; $0.31 Per Diluted Share
  • Provision for Credit Losses of $112.0 Million
  • Loan and Lease Production of $790 Million; $898 Million of Net Loan Growth
  • Core Deposits Represents 82% of Total Deposits
  • Tax Equivalent Net Interest Margin of 4.31% Compared to 4.33% in Q4
  • Cost of Average Total Deposits Decreased 12 Basis Points from Q4 to 59 Basis Points

LOS ANGELES, April 21, 2020 (GLOBE NEWSWIRE) -- PacWest Bancorp (Nasdaq: PACW) today announced a net loss for the first quarter of 2020 of $1.43 billion, or $12.23 per diluted share, compared to net earnings for the fourth quarter of 2019 of $117.9 million, or $0.98 per diluted share. The decrease in net earnings in the first quarter was primarily due to a $1.47 billion goodwill impairment charge and a higher provision for credit losses attributable primarily to the significant deterioration in the economic forecast used to estimate the allowance for credit losses.

Matt Wagner, President and CEO, commented, “The COVID-19 pandemic has significantly impacted the entire economy resulting in non-essential businesses temporarily closing, record increases in unemployment, and severe declines in business activity in certain industries such as travel and restaurants among others. Our first priority is the health and safety of our employees and customers and we have implemented social distancing actions including the temporary closure of 27 bank lobbies where drive-up tellers are available, the temporary closure of 19 branches where branches are in close proximity to each other, reducing branch hours, and enabling virtually all of our non-branch employees to work remotely. We are also committed to providing essential services to existing and new customers to help them with their financial needs during this crisis. We are waiving fees and modifying loans through payment deferrals and term extensions to help small and middle-market businesses weather this downturn. All our actions are focused on doing the right thing for our employees, customers, and the communities we serve.”

Mr. Wagner continued, “The unprecedented decline in economic conditions triggered by the COVID-19 pandemic, caused a significant decline in stock market valuations in March, including our stock price. As a result, we recorded a goodwill impairment charge as our estimated fair value was less than our book value. This is a non-cash charge and has no impact on our regulatory capital ratios, cash flows or liquidity position. Our operations remain strong as evidenced by the increase in net interest income and the significant loan growth in the first quarter including $167.1 million in our Denver market.”

Mr. Wagner added, “We also took a significant provision for credit losses during the quarter driven by the bleak economic forecasts and impact from loan downgrades as we performed an extensive review of our loan portfolio with a special focus on the segments most impacted by COVID-19, including hotels, aviation, restaurants, and retail.”

FINANCIAL HIGHLIGHTS

 
 At or For the    At or For the   
 Three Months Ended   Three Months Ended  
 March 31, December 31, Increase March 31, Increase
Financial Highlights  2020   2019  (Decrease)  2020   2019  (Decrease)
                        
 (Dollars in thousands, except per share data)
Net (loss) earnings$(1,433,111) $117,881  $(1,550,992) $(1,433,111) $112,604  $(1,545,715)
Diluted (loss) earnings           
per share$(12.23) $0.98  $(13.21) $(12.23) $0.92  $(13.15)
Return on average assets (21.27)%  1.77%  (23.04)  (21.27)%  1.77%  (23.04)
Return on average           
tangible equity (1) 6.88%  19.98%  (13.10)  6.88%  20.64%  (13.76)
            
Net interest margin ("NIM")           
(tax equivalent) 4.31%  4.33%  (0.02)  4.31%  4.69%  (0.38)
Yield on average loans and           
leases (tax equivalent) 5.54%  5.67%  (0.13)  5.54%  6.16%  (0.62)
Cost of average total           
deposits 0.59%  0.71%  (0.12)  0.59%  0.73%  (0.14)
Efficiency ratio 40.6%  44.8%  (4.2)  40.6%  42.4%  (1.8)
            
Total assets$26,143,267  $26,770,806  $(627,539) $26,143,267  $26,324,138  $(180,871)
Loans and leases held           
for investment,           
net of deferred fees$19,745,305  $18,846,872  $898,433  $19,745,305  $18,307,697  $1,437,608 
Noninterest-bearing           
demand deposits$7,510,218  $7,243,298  $266,920  $7,510,218  $7,712,409  $(202,191)
Core deposits$16,050,522  $16,187,287  $(136,765) $16,050,522  $16,127,638  $(77,116)
Total deposits$19,575,837  $19,233,036  $342,801  $19,575,837  $19,285,927  $289,910 
            
As percentage of total           
deposits:           
Noninterest-bearing           
demand deposits 38%  38%  -   38%  40%  (2)
Core deposits 82%  84%  (2)  82%  84%  (2)
            
Equity to assets ratio 12.97%  18.51%  (5.54)  12.97%  18.20%  (5.23)
Tangible common equity           
ratio (1) 9.10%  9.79%  (0.69)  9.10%  9.23%  (0.13)
Book value per share$28.75  $41.36  $(12.61) $28.75  $39.86  $(11.11)
Tangible book value per           
share (1)$19.31  $19.77  $(0.46) $19.31  $18.22  $1.09 
            
(1) Non-GAAP measure.           
            

INCOME STATEMENT HIGHLIGHTS

Net Interest Income

Net interest income increased by $3.1 million to $249.7 million for the first quarter of 2020 compared to $246.6 million for the fourth quarter of 2019 due mainly to a lower cost of average interest-bearing liabilities and a higher balance of average loans and leases, partially offset by a lower loan and lease yield and one less day in the first quarter. The tax equivalent yield on average loans and leases was 5.54% for the first quarter of 2020 compared to 5.67% for the fourth 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.

The tax equivalent NIM was 4.31% for the first quarter of 2020 compared to 4.33% for the fourth quarter of 2019. The decrease in the NIM was due mainly to the repricing of variable-rate loans causing lower coupon interest, offset partially by the lower cost of average interest-bearing liabilities.

The cost of average total deposits decreased to 0.59% for the first quarter of 2020 from 0.71% for the fourth quarter of 2019. The lower cost of average interest-bearing deposits reflected actions taken to reduce deposit rates in light of the two emergency interest rate cuts by the Federal Reserve in March of 2020. We expect these rate reductions to be more fully realized in the second quarter as evidenced by our cost of deposits at March 31, 2020 of 0.33%.

Provision for Credit Losses

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

 Three Months Ended   
 March 31,  December 31, Increase
Provision for Credit Losses 2020    2019 (Decrease)
       
 (In thousands)
Addition to allowance for loan and lease losses$98,000   $1,000 $97,000 
Addition to reserve for unfunded      
loan commitments 14,000    2,000  12,000 
Total provision for credit losses$112,000   $3,000 $109,000 
       

The increase in the provision for credit losses in the first quarter of 2020 was the result of the impact of the current economic forecast which reflected a significant deterioration in key macro-economic forecast variables such as unemployment and GDP, significant loan downgrades into special mention, and higher provisions on individually evaluated loans.

Noninterest Income

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

 Three Months Ended  
 March 31, December 31, Increase
Noninterest Income 2020   2019  (Decrease)
      
 (In thousands)
Service charges on deposit accounts$2,658  $3,611  $(953)
Other commissions and fees 9,721   10,170   (449)
Leased equipment income 12,251   10,648   1,603 
Gain on sale of loans and leases 87   23   64 
Gain on sale of securities 182   184   (2)
Other income:     
Dividends and gains (losses) on equity investments 28   (794)  822 
Warrant income 837   1,240   (403)
Other 3,336   2,094   1,242 
Total noninterest income$29,100  $27,176  $1,924 
      

Noninterest income increased by $1.9 million to $29.1 million for the first quarter of 2020 compared to $27.2 million for the fourth quarter of 2019 due primarily to a $1.6 million increase in leased equipment income and a $1.2 million increase in other income, offset partially by a $1.0 million decrease in deposit service charges. The increase in leased equipment income was due to early lease terminations, which resulted in higher termination gains and accretion of deferred fees. The increase in other income was due mainly to $1.1 million of bankruptcy proceeds received related to a former credit. The decrease in deposit service charges was due mainly to waivers of various fees (service charges, wire fees, overdraft fees, NSF fees) to offer assistance to our customers during the COVID-19 crisis.

Noninterest Expense

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

      
 Three Months Ended  
 March 31, December 31, Increase
Noninterest Expense 2020   2019  (Decrease)
      
 (In thousands)
Compensation$61,282  $74,637  $(13,355)
Occupancy 14,207   14,541   (334)
Data processing 6,454   6,770   (316)
Other professional services 4,258   4,261   (3)
Insurance and assessments 4,249   4,168   81 
Intangible asset amortization 3,948   4,153   (205)
Leased equipment depreciation 7,205   6,856   349 
Foreclosed assets expense (income), net 66   (3,446)  3,512 
Acquisition, integration and reorganization costs -   (269)  269 
Customer related expense 3,932   3,952   (20)
Loan expense 2,650   2,967   (317)
Other 9,719   5,138   4,581 
Total operating expense 117,970   123,728   (5,758)
Goodwill impairment 1,470,000   -   1,470,000 
Total noninterest expense$1,587,970  $123,728  $1,464,242 
      

Noninterest expense increased by $1.5 billion to $1.59 billion for the first quarter of 2020 compared to $123.7 million for the fourth quarter of 2019 attributable primarily to a $1.47 billion goodwill impairment charge. Excluding the goodwill impairment charge, noninterest expense decreased to $118.0 million or a decrease of $5.8 million. This $5.8 million decrease was mainly due to a $13.4 million decrease in compensation expense, partially offset by a $4.6 million increase in other expense and a $3.5 million increase in foreclosed assets expense. Compensation expense decreased mainly due to lower bonus accruals, partially offset by higher payroll tax expense. Other expense increased due primarily to the prior quarter including $2.8 million of credits related to the reversal of accrued merger costs and franchise tax refunds, while the first quarter includes a $1.5 million accrual for operational loss contingencies related to a system outage at a service provider. Foreclosed assets expense increased as the prior quarter included a $3.3 million gain on the sale of a repossessed asset.

Income Taxes

The effective income tax rate was (0.8)% in the first quarter of 2020 compared to 19.8% for the fourth quarter of 2019. Excluding non-deductible goodwill impairment, the effective income tax rate was 24.5%. 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. Excluding the non-deductible goodwill impairment, the effective tax rate 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
Roll Forward of Loans and Leases HeldMarch 31,  December 31,
for Investment, Net of Deferred Fees (1) 2020   2019 
        
 (Dollars in thousands)
Balance, beginning of period$18,846,872  $18,735,543 
Additions:   
Production 789,746   1,021,334 
Disbursements 1,997,080   1,317,389 
Total production and disbursements 2,786,826   2,338,723 
Reductions:   
Payoffs (812,707)  (816,134)
Paydowns (1,053,705)  (1,406,475)
Total payoffs and paydowns (1,866,412)  (2,222,609)
Sales -   (43)
Transfers to foreclosed assets (1,776)  (83)
Charge-offs (20,205)  (4,659)
Total reductions (1,888,393)  (2,227,394)
Net increase 898,433   111,329 
Balance, end of period$19,745,305  $18,846,872 
    
Weighted average rate on production (2) 4.31%  4.73%
    
(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 20 basis points to loan
yields in 2020.

Loans and leases held for investment, net of deferred fees, increased by $898.4 million, or 19.2% annualized, in the first quarter of 2020, to $19.7 billion at March 31, 2020. The net loan growth in the first quarter was primarily from the venture capital and asset-based loan portfolio classes, along with ongoing fundings in the residential real estate construction loan class. The growth in venture capital, primarily from drawdown activity, included $241 million in expansion stage, $203 million in equity funds and $63 million in late stage loans.

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:

 
 March 31, 2020 December 31, 2019 March 31, 2019
  % of   % of   % of
Loan and Lease Portfolio BalanceTotal BalanceTotal BalanceTotal
               
 (In thousands)
Real estate mortgage:        
Commercial$4,220,64921% $4,202,68722% $4,640,51025%
Income producing and other        
residential 3,788,29519%  3,770,06020%  3,518,94819%
Total real estate mortgage 8,008,94440%  7,972,74742%  8,159,45844%
Real estate construction and land:        
Commercial 1,087,5056%  1,082,3686%  943,5965%
Residential 1,792,7489%  1,655,4349%  1,408,1288%
Total real estate construction        
and land 2,880,25315%  2,737,80215%  2,351,72413%
Total real estate 10,889,19755%  10,710,54957%  10,511,18257%
Commercial:        
Asset-based 3,938,40220%  3,748,40720%  3,422,20219%
Venture capital 2,715,83714%  2,179,42212%  2,027,45011%
Other commercial 1,771,9859%  1,767,6679%  1,974,70211%
Total commercial 8,426,22443%  7,695,49641%  7,424,35441%
Consumer 429,8842%  440,8272%  372,1612%
Total loans and leases held for        
investment, net of deferred fees$19,745,305100% $18,846,872100% $18,307,697100%
         
Total unfunded loan commitments$7,697,724  $8,183,158  $7,465,392 
         

Allowance for Credit Losses

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

 Three Months Ended March 31, 2020
 Allowance for Reserve for  Total
Allowance for Credit Loan and  Unfunded Loan Allowance for
Losses RollforwardLease Losses Commitments Credit Losses
            
 (In thousands)
Beginning balance$138,785  $35,861  $174,646 
Charge-offs (20,205)  -   (20,205)
Recoveries 1,095   -   1,095 
Net charge-offs (19,110)  -   (19,110)
Provision 98,000   14,000   112,000 
Cumulative effect of change in     
accounting principle - CECL 3,617   3,710   7,327 
Ending balance$221,292  $53,571  $274,863 
      


 Three Months Ended December 31, 2019
 Allowance for Reserve for  Total
Allowance for Credit Loan and  Unfunded Loan Allowance for
Losses RollforwardLease 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 
      
      

We adopted CECL on January 1, 2020, which resulted in an increase in the allowance for credit losses of $7.3 million on the adoption date. The significant ACL increase during the first quarter was primarily attributable to the dramatic decline in the economic forecast, the significant increase in special mention loans caused by loan downgrades in the loan portfolios most impacted by the sudden decline in the economy, the loan growth during the quarter, and increased provisions for individually evaluated loans.

The allowance for credit losses as a percentage of loans and leases held for investment was 1.39% at March 31, 2020 under CECL and 0.93% at December 31, 2019 under the incurred loss model.

Gross charge-offs for the first quarter of 2020 were $20.2 million and included $11.5 million for an asset-based oil industry loan and $7.3 million for other commercial loans compared to gross charge-offs for the fourth quarter of 2019 of $4.7 million that included $3.2 million for venture capital loans and $1.0 million for other commercial loans.

Recoveries for the first quarter of 2020 were $1.1 million and included $0.4 million for other commercial loans and $0.4 million for asset-based loans compared to recoveries for the fourth quarter of 2019 of $3.9 million that included $1.8 million for other commercial loans, $0.9 million for asset-based loans, and $0.6 million for venture capital loans.

For the first quarter of 2020 and fourth quarter of 2019, annualized net charge-offs to average loans and leases were 0.40% and 0.02%.

Deposits and Client Investment Funds

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

 March 31, 2020 December 31, 2019 March 31, 2019
  % of   % of   % of
Deposit CompositionBalanceTotal BalanceTotal BalanceTotal
               
 (Dollars in thousands)
Noninterest-bearing demand$7,510,21838% $7,243,29838% $7,712,40940%
Interest checking 3,333,14717%  3,753,97819%  3,163,22816%
Money market 4,712,11824%  4,690,42024%  4,714,07825%
Savings 495,0393%  499,5913%  537,9233%
Total core deposits 16,050,52282%  16,187,28784%  16,127,63884%
Non-core non-maturity deposits 836,1574%  496,4073%  454,2772%
Total non-maturity deposits 16,886,67986%  16,683,69487%  16,581,91586%
Time deposits $250,000 and under 2,086,18811%  2,065,73311%  2,258,98912%
Time deposits over $250,000 602,9703%  483,6092%  445,0232%
Total time deposits 2,689,15814%  2,549,34213%  2,704,01214%
Total deposits$19,575,837100% $19,233,036100% $19,285,927100%
         

At March 31, 2020, core deposits totaled $16.1 billion, or 82% of total deposits, including $7.5 billion of noninterest-bearing demand deposits, or 38% 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 Pacific Western Asset Management Inc. (“PWAM”), our registered investment advisor subsidiary, and third-party sweep products. Total off-balance sheet client investment funds at March 31, 2020 were $1.4 billion, of which $1.1 billion was managed by PWAM.

CREDIT QUALITY

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

 
 March 31, December 31, Increase
Credit Quality Metrics  2020   2019  (Decrease)
            
 (Dollars in thousands)
NPAs and Performing TDRs:     
Nonaccrual loans and leases held for investment (1)$95,602  $92,353  $3,249 
Accruing loans contractually past due 90 days or more -   -   - 
Foreclosed assets, net 1,701   440   1,261 
Total nonperforming assets ("NPAs")$97,303  $92,793  $4,510 
      
Performing TDRs held for investment$8,978  $12,257  $(3,279)
      
Nonaccrual loans and leases held for investment     
to loans and leases held for investment 0.48%  0.49%  
Nonperforming assets to loans and leases     
held for investment and foreclosed assets 0.49%  0.49%  
      
Loan and Lease Credit Risk Ratings:     
Pass$18,698,942  $18,348,004  $350,938 
Special mention 898,658   322,956   575,702 
Classified 147,705   175,912   (28,207)
Total loans and leases held for investment,     
net of deferred fees$19,745,305  $18,846,872  $898,433 
      
Classified loans and leases held for investment     
to loans and leases held for investment 0.75%  0.93%  
      
Allowance for Credit Losses:     
Allowance for credit losses$274,863  $174,646  $100,217 
Provision for credit losses (for the quarter)$112,000  $3,000  $109,000 
Net charge-offs (for the quarter)$19,110  $767  $18,343 
Net charge-offs to average loans and leases     
(for the quarter) 0.40%  0.02%  
Allowance for credit losses to loans and leases     
held for investment 1.39%  0.93%  
Allowance for credit losses to nonaccrual loans     
and leases held for investment 287.5%  189.1%  
      
(1) Nonaccrual loans include guaranteed amounts of $16.0 million at March 31, 2020 and $17.5 million
at December 31, 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, including loan downgrades, which were higher than usual triggered by the economic impact from the COVID-19 pandemic.

During the first quarter of 2020, nonaccrual loans and leases increased by $3.2 million, while classified loans and leases decreased by $28.2 million and special mention loans and leases increased by $575.7 million. The decrease in the classified loans and leases category was primarily due to charge-offs totaling approximately $18.0 million, which included an $11.5 million charge-off on a previously classified asset-based oil industry loan and charge-offs totaling $6.1 million on two security monitoring loans. The increase in special mention loans and leases in the first quarter was attributable to loan downgrades primarily in the categories most acutely impacted by COVID-19 including hotels, aviation, restaurants, retail, and small business loans. 

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
 March 31, 2020 December 31, 2019 30-89 Days Past Due
  % of   % of  March 31, December 31,
  Loan   Loan   2020   2019 
 BalanceCategory BalanceCategory Balance Balance
                  
 (Dollars in thousands)
Real estate mortgage:         
Commercial$19,0880.5% $18,3460.4% $1,807  $1,735 
Income producing and other         
residential 2,3080.1%  2,4780.1%  1,064   2,094 
Total real estate mortgage 21,3960.3%  20,8240.3%  2,871   3,829 
Real estate construction and land:         
Commercial 3510.0%  3640.0%  -   - 
Residential -0.0%  -0.0%  241   1,429 
Total real estate         
construction and land 3510.0%  3640.0%  241   1,429 
Commercial:         
Asset-based 17,1040.4%  30,1620.8%  -   19 
Venture capital 18,6120.7%  12,9160.6%  183   - 
Other commercial 37,7262.1%  27,5941.6%  4,393   2,258 
Total commercial 73,4420.9%  70,6720.9%  4,576   2,277 
Consumer 4130.1%  4930.1%  518   1,006 
Total held for investment$95,6020.5% $92,3530.5% $8,206  $8,541 
          

 CAPITAL

Effective March 31, 2020, we elected the 5-year phase-in as allowed under the recently issued interim regulatory capital rule (IFR) revising the transition for CECL. The IFR allows the addback of 100% of the capital effect of the day one CECL transition adjustment and 25% of subsequent increases in the allowance for credit losses to regulatory capital through December 31, 2021. This cumulative amount will then be reduced from capital over a three year phase-in period. This election increased our regulatory capital ratios by approximately 12 basis points at March 31, 2020. The capital ratios are presented on page 21.

STOCK REPURCHASE PROGRAM

During February 2020, we repurchased 1,953,711 shares at an average price of $35.83 and a total cost of $70.0 million under the previous share repurchase program which expired on February 29, 2020. At March 31, 2020, the remaining amount that could be used to repurchase shares under the $200 million Stock Repurchase Program approved on February 12, 2020 was $200.0 million. The previously announced suspension of share repurchases through June 30, 2020 has been extended indefinitely in light of recent COVID-19 related developments.

ABOUT PACWEST BANCORP

PacWest Bancorp (“PacWest”) is a bank holding company with over $26 billion in assets headquartered in Los Angeles, California, with executive offices in Denver, Colorado, 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. The Bank provides community banking products including 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. The Bank offers national lending products including asset-based, equipment, and real estate loans and treasury management services to established middle-market businesses on a national basis. The Bank also offers venture banking products including a comprehensive suite of financial services focused on entrepreneurial and 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 Bancorp that is intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements about future financial and operational results, expectations, or intentions are forward-looking statements. Such statements are based on information available at the time of the 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. The COVID-19 pandemic is adversely affecting PacWest Bancorp, its employees, customers and third-party service providers, and the ultimate extent of the impacts on its business, financial position, results of operations, liquidity and prospects is uncertain. Continued deterioration in general business and economic conditions could adversely affect PacWest Bancorp’s revenues and the values of its assets and liabilities, lead to a tightening of credit and increase stock price volatility. In addition, PacWest Bancorp’s results could be adversely affected by changes in interest rates, further increases in unemployment rates, deterioration in the credit quality of its loan portfolio or in the value of the collateral securing those loans, deterioration in the value of its investment securities, legal and regulatory developments, the price of crude oil and the adoption of the CECL accounting standard. Actual results may differ materially from those set forth or implied in the forward-looking statements due to a variety of factors, including the risk factors described in documents filed by the Company with the U.S. 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
 
 March 31, December 31, March 31,
  2020   2019   2019 
            
 (Dollars in thousands, except per share data)
ASSETS:     
Cash and due from banks$172,570  $172,585  $224,758 
Interest-earning deposits in financial institutions 439,690   465,039   332,124 
Total cash and cash equivalents  612,260   637,624   556,882 
      
Securities available-for-sale, at estimated fair value 3,757,663   3,797,187   3,994,708 
Federal Home Loan Bank stock, at cost 54,244   40,924   29,430 
Total investment securities 3,811,907   3,838,111   4,024,138 
      
Loans held for sale -   -   25,124 
      
Gross loans and leases held for investment 19,806,394   18,910,740   18,371,295 
Deferred fees, net (61,089)  (63,868)  (63,598)
Total loans and leases held for investment,     
net of deferred fees 19,745,305   18,846,872   18,307,697 
Allowance for loan and lease losses (221,292)  (138,785)  (136,281)
Total loans and leases held for investment, net 19,524,013   18,708,087   18,171,416 
      
Equipment leased to others under operating leases 306,530   324,084   293,853 
Premises and equipment, net 39,799   38,585   37,783 
Foreclosed assets, net 1,701   440   3,291 
Goodwill 1,078,670   2,548,670   2,548,670 
Core deposit and customer relationship intangibles, net 34,446   38,394   52,250 
Other assets 733,941   636,811   610,731 
Total assets$26,143,267  $26,770,806  $26,324,138 
      
LIABILITIES:     
Noninterest-bearing deposits$7,510,218  $7,243,298  $7,712,409 
Interest-bearing deposits 12,065,619   11,989,738   11,573,518 
Total deposits 19,575,837   19,233,036   19,285,927 
Borrowings 2,295,000   1,759,008   1,481,087 
Subordinated debentures 458,994   458,209   454,458 
Accrued interest payable and other liabilities 423,047   365,856   311,684 
Total liabilities 22,752,878   21,816,109   21,533,156 
STOCKHOLDERS' EQUITY (1) 3,390,389   4,954,697   4,790,982 
Total liabilities and stockholders’ equity$26,143,267  $26,770,806  $26,324,138 
      
Book value per share$28.75  $41.36  $39.86 
Tangible book value per share (2)$19.31  $19.77  $18.22 
Shares outstanding 117,916,789   119,781,605   120,201,149 
      
(1) Includes net unrealized gain on securities     
available-for-sale, net$90,916  $78,658  $37,258 
(2) Non-GAAP measure.     
      



PACWEST BANCORP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
 
 Three Months Ended
 March 31, December 31, March 31,
  2020   2019   2019 
            
 (Dollars in thousands, except per share data)
Interest income:     
Loans and leases$262,278  $263,402  $274,229 
Investment securities 27,446   28,135   29,680 
Deposits in financial institutions 1,608   2,056   650 
Total interest income 291,332   293,593   304,559 
      
Interest expense:     
Deposits 28,247   34,802   34,235 
Borrowings 6,778   5,189   7,710 
Subordinated debentures 6,560   6,983   7,738 
Total interest expense 41,585   46,974   49,683 
      
Net interest income 249,747   246,619   254,876 
Provision for credit losses 112,000   3,000   4,000 
Net interest income after     
provision for credit losses 137,747   243,619   250,876 
      
Noninterest income:     
Service charges on deposit accounts 2,658   3,611   3,730 
Other commissions and fees 9,721   10,170   11,008 
Leased equipment income 12,251   10,648   9,282 
Gain on sale of loans and leases 87   23   - 
Gain on sale of securities 182   184   2,161 
Other income 4,201   2,540   4,883 
Total noninterest income 29,100   27,176   31,064 
      
Noninterest expense:     
Compensation 61,282   74,637   70,845 
Occupancy 14,207   14,541   14,320 
Data processing 6,454   6,770   6,925 
Other professional services 4,258   4,261   4,513 
Insurance and assessments 4,249   4,168   4,038 
Intangible asset amortization 3,948   4,153   4,870 
Leased equipment depreciation 7,205   6,856   5,651 
Foreclosed assets expense (income), net 66   (3,446)  29 
Acquisition, integration and     
reorganization costs -   (269)  618 
Customer related expense 3,932   3,952   2,943 
Loan expense 2,650   2,967   2,885 
Goodwill impairment 1,470,000   -   - 
Other expense 9,719   5,138   8,650 
Total noninterest expense 1,587,970   123,728   126,287 
      
(Loss) earnings before income taxes (1,421,123)  147,067   155,653 
Income tax expense 11,988   29,186   43,049 
Net (loss) earnings $(1,433,111) $117,881  $112,604 
      
Basic and diluted (loss) earnings per share$(12.23) $0.98  $0.92 
Dividends declared and paid per share$0.60  $0.60  $0.60 
      



PACWEST BANCORP AND SUBSIDIARIES
NET EARNINGS PER SHARE CALCULATIONS
 
 Three Months Ended
 March 31, December 31, March 31,
  2020   2019   2019 
            
 (In thousands, except per share data)
Basic Earnings Per Share:     
Net (loss) earnings$(1,433,111) $117,881  $112,604 
Less: earnings allocated to unvested     
restricted stock (1) (939)  (1,458)  (1,163)
Net (loss) earnings allocated to     
common shares$(1,434,050) $116,423  $111,441 
      
Weighted-average basic shares and     
unvested restricted stock outstanding 118,775   119,804   122,227 
Less: weighted-average unvested     
restricted stock outstanding (1,495)  (1,566)  (1,352)
Weighted-average basic shares     
outstanding 117,280   118,238   120,875 
      
Basic (loss) earnings per share$(12.23) $0.98  $0.92 
      
Diluted Earnings Per Share:     
Net (loss) earnings allocated to     
common shares$(1,434,050) $116,423  $111,441 
      
Weighted-average diluted shares     
outstanding 117,280   118,238   120,875 
      
Diluted (loss) earnings per share$(12.23) $0.98  $0.92 
      
(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 
 March 31, 2020 December 31, 2019 March 31, 2019 
  InterestAverage  InterestAverage  InterestAverage 
 Average Income/Yield/ Average Income/Yield/ Average Income/Yield/ 
 BalanceExpenseCost BalanceExpenseCost BalanceExpenseCost 
                      
 (Dollars in thousands) 
Assets:            
Loans and leases (1)(2)$19,065,035$262,7645.54% $18,470,583$263,7835.67% $18,064,230$274,5136.16% 
Investment securities (3) 3,853,217 28,6412.99%  3,811,216 29,5093.07%  3,968,531 30,5723.12% 
Deposits in financial            
institutions 537,384 1,6081.20%  498,068 2,0561.64%  111,950 6502.35% 
Total interest-earning            
assets (1) 23,455,636 293,0135.02%  22,779,867 295,3485.14%  22,144,711 305,7355.60% 
Other assets 3,643,404    3,600,872    3,631,238   
Total assets$27,099,040   $26,380,739   $25,775,949   
             
Liabilities and             
Stockholders' Equity:            
Interest checking$3,466,812 7,1350.83% $3,731,696 10,0311.07% $3,041,822 9,3211.24% 
Money market 5,247,866 10,0160.77%  5,117,553 12,0630.94%  5,274,987 14,9081.15% 
Savings 497,959 1600.13%  509,497 2040.16%  553,032 2420.18% 
Time 2,684,143 10,9361.64%  2,744,156 12,5041.81%  2,286,932 9,7641.73% 
Total interest-bearing            
deposits 11,896,780 28,2470.95%  12,102,902 34,8021.14%  11,156,773 34,2351.24% 
Borrowings 2,026,749 6,7781.35%  1,179,220 5,1891.75%  1,218,319 7,7102.57% 
Subordinated debentures 458,399 6,5605.76%  456,997 6,9836.06%  454,203 7,7386.91% 
Total interest-bearing            
liabilities 14,381,928 41,5851.16%  13,739,119 46,9741.36%  12,829,295 49,6831.57% 
Noninterest-bearing            
demand deposits 7,357,717    7,338,888    7,783,652   
Other liabilities 402,617    372,550    347,037   
Total liabilities 22,142,262    21,450,557    20,959,984   
Stockholders' equity 4,956,778    4,930,182    4,815,965   
Total liabilities and            
stockholders' equity$27,099,040   $26,380,739   $25,775,949   
Net interest income (1) $251,428   $248,374   $256,052  
Net interest spread (1)  3.86%   3.78%   4.03% 
Net interest margin (1)  4.31%   4.33%   4.69% 
             
Total deposits (4)$19,254,497$28,2470.59% $19,441,790$34,8020.71% $18,940,425$34,2350.73% 
             
(1) Tax equivalent.
(2) Includes discount accretion on acquired loans of $4.8 million, $3.0 million, and $3.0 million for the three months ended March 31, 2020,
December 31, 2019, and March 31, 2019, respectively.
(3) Includes tax-equivalent adjustments of $1.2 million, $1.4 million, and $0.9 million for the three months ended March 31, 2020,
December 31, 2019, and March 31, 2019 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.
 
 



PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER BALANCE SHEET
 
 March 31, December 31, September 30, June 30, March 31,
  2020   2019   2019   2019   2019 
                    
 (Dollars in thousands, except per share data)
ASSETS:         
Cash and due from banks$172,570  $172,585  $252,596  $185,075  $224,758 
Interest-earning deposits in financial         
institutions 439,690   465,039   483,405   422,663   332,124 
Total cash and cash equivalents  612,260   637,624   736,001   607,738   556,882 
          
Securities available-for-sale 3,757,663   3,797,187   3,817,348   3,807,244   3,994,708 
Federal Home Loan Bank stock 54,244   40,924   26,865   43,146   29,430 
Total investment securities 3,811,907   3,838,111   3,844,213   3,850,390   4,024,138 
          
Loans held for sale -   -   -   -   25,124 
          
Gross loans and leases held for investment 19,806,394   18,910,740   18,796,011   18,532,740   18,371,295 
Deferred fees, net (61,089)  (63,868)  (60,468)  (59,888)  (63,598)
Total loans and leases held for         
investment, net of deferred fees 19,745,305   18,846,872   18,735,543   18,472,852   18,307,697 
Allowance for loan and lease losses (221,292)  (138,785)  (138,552)  (135,037)  (136,281)
Total loans and leases held for         
investment, net 19,524,013   18,708,087   18,596,991   18,337,815   18,171,416 
          
Equipment leased to others under         
operating leases 306,530   324,084   295,854   300,668   293,853 
Premises and equipment, net 39,799   38,585   37,926   38,162   37,783 
Foreclosed assets, net 1,701   440   1,366   1,472   3,291 
Goodwill 1,078,670   2,548,670   2,548,670   2,548,670   2,548,670 
Core deposit and customer relationship         
intangibles, net 34,446   38,394   42,547   47,380   52,250 
Other assets 733,941   636,811   621,059   612,119   610,731 
Total assets$26,143,267  $26,770,806  $26,724,627  $26,344,414  $26,324,138 
          
LIABILITIES:         
Noninterest-bearing deposits$7,510,218  $7,243,298  $7,441,185  $7,299,213  $7,712,409 
Interest-bearing deposits 12,065,619   11,989,738   12,292,018   11,506,543   11,573,518 
Total deposits 19,575,837   19,233,036   19,733,203   18,805,756   19,285,927 
Borrowings 2,295,000   1,759,008   1,253,031   1,913,059   1,481,087 
Subordinated debentures 458,994   458,209   456,145   456,112   454,458 
Accrued interest payable and other         
liabilities 423,047   365,856   362,140   317,477   311,684 
Total liabilities 22,752,878   21,816,109   21,804,519   21,492,404   21,533,156 
STOCKHOLDERS' EQUITY (1) 3,390,389   4,954,697   4,920,108   4,852,010   4,790,982 
Total liabilities and stockholders’          
equity$26,143,267  $26,770,806  $26,724,627  $26,344,414  $26,324,138 
          
Book value per share$28.75  $41.36  $41.06  $40.49  $39.86 
Tangible book value per share (2)$19.31  $19.77  $19.43  $18.83  $18.22 
Shares outstanding 117,916,789   119,781,605   119,831,192   119,829,104   120,201,149 
          
(1) Includes net unrealized gain on         
securities available-for-sale, net$90,916  $78,658  $95,887  $73,066  $37,258 
(2) Non-GAAP measure.         
          



PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER STATEMENT OF EARNINGS
 
 Three Months Ended
 March 31, December 31, September 30, June 30, March 31,
  2020   2019   2019   2019   2019 
                    
 (Dollars in thousands, except per share data)
Interest income:         
Loans and leases$262,278  $263,402  $275,978  $284,236  $274,229 
Investment securities 27,446   28,135   28,806   28,948   29,680 
Deposits in financial institutions 1,608   2,056   2,424   1,349   650 
Total interest income 291,332   293,593   307,208   314,533   304,559 
          
Interest expense:         
Deposits 28,247   34,802   40,703   38,720   34,235 
Borrowings 6,778   5,189   6,852   7,210   7,710 
Subordinated debentures 6,560   6,983   7,417   7,705   7,738 
Total interest expense 41,585   46,974   54,972   53,635   49,683 
          
Net interest income 249,747   246,619   252,236   260,898   254,876 
Provision for credit losses 112,000   3,000   7,000   8,000   4,000 
Net interest income after         
provision for credit losses 137,747   243,619   245,236   252,898   250,876 
          
Noninterest income:         
Service charges on deposit accounts 2,658   3,611   3,525   3,771   3,730 
Other commissions and fees 9,721   10,170   10,855   11,590   11,008 
Leased equipment income 12,251   10,648   9,615   9,182   9,282 
Gain on sale of loans and leases 87   23   765   326   - 
Gain on sale of securities 182   184   908   22,192   2,161 
Other income 4,201   2,540   7,761   3,832   4,883 
Total noninterest income 29,100   27,176   33,429   50,893   31,064 
          
Noninterest expense:         
Compensation 61,282   74,637   71,424   68,956   70,845 
Occupancy 14,207   14,541   14,089   14,457   14,320 
Data processing 6,454   6,770   7,044   6,817   6,925 
Other professional services 4,258   4,261   4,400   4,629   4,513 
Insurance and assessments 4,249   4,168   4,100   4,098   4,038 
Intangible asset amortization 3,948   4,153   4,833   4,870   4,870 
Leased equipment depreciation 7,205   6,856   5,951   5,558   5,651 
Foreclosed assets expense (income), net 66   (3,446)  8   (146)  29 
Acquisition, integration and         
reorganization costs -   (269)  -   -   618 
Customer related expense 3,932   3,952   3,539   3,405   2,943 
Loan expense 2,650   2,967   3,628   3,451   2,885 
Goodwill impairment 1,470,000   -   -   -   - 
Other expense 9,719   5,138   7,793   9,332   8,650 
Total noninterest expense 1,587,970   123,728   126,809   125,427   126,287 
          
(Loss) earnings before income taxes (1,421,123)  147,067   151,856   178,364   155,653 
Income tax expense 11,988   29,186   41,830   50,239   43,049 
Net (loss) earnings $(1,433,111) $117,881  $110,026  $128,125  $112,604 
          
Basic and diluted (loss) earnings per share$(12.23) $0.98  $0.92  $1.07  $0.92 
Dividends declared and paid per share$0.60  $0.60  $0.60  $0.60  $0.60 
          



PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER SELECTED FINANCIAL DATA
 
 At or For the Three Months Ended
 March 31, December 31, September 30, June 30, March 31,
  2020   2019   2019   2019   2019 
                    
 (Dollars in thousands)
Performance Ratios:         
Return on average assets (1) (21.27)%  1.77%  1.65%  1.99%  1.77%
Return on average equity (1) (116.28)%  9.49%  8.93%  10.66%  9.48%
Return on average tangible equity (1)(2) 6.88%  19.98%  19.01%  23.15%  20.64%
Efficiency ratio 40.6%  44.8%  42.3%  41.6%  42.4%
Noninterest expense as a percentage         
of average assets (1) 23.57%  1.86%  1.91%  1.95%  1.99%
          
Average Yields/Costs (1):         
Yield on:         
Average loans and leases (3) 5.54%  5.67%  5.91%  6.26%  6.16%
Average interest-earning assets (3) 5.02%  5.14%  5.41%  5.68%  5.60%
Cost of:         
Average interest-bearing deposits 0.95%  1.14%  1.34%  1.35%  1.24%
Average total deposits 0.59%  0.71%  0.83%  0.81%  0.73%
Average interest-bearing liabilities 1.16%  1.36%  1.60%  1.64%  1.57%
Net interest spread (3) 3.86%  3.78%  3.81%  4.04%  4.03%
Net interest margin (3) 4.31%  4.33%  4.46%  4.72%  4.69%
          
Average Balances:         
Assets:         
Loans and leases, net of deferred fees$19,065,035  $18,470,583  $18,539,281  $18,239,690  $18,064,230 
Interest-earning assets 23,455,636   22,779,867   22,793,676   22,258,828   22,144,711 
Total assets 27,099,040   26,380,739   26,406,603   25,849,189   25,775,949 
Liabilities:         
Noninterest-bearing deposits 7,357,717   7,338,888   7,487,555   7,544,027   7,783,652 
Interest-bearing deposits 11,896,780   12,102,902   12,031,776   11,545,785   11,156,773 
Total deposits 19,254,497   19,441,790   19,519,331   19,089,812   18,940,425 
Borrowings 2,026,749   1,179,220   1,181,313   1,142,223   1,218,319 
Subordinated debentures 458,399   456,997   456,011   454,901   454,203 
Interest-bearing liabilities 14,381,928   13,739,119   13,669,100   13,142,909   12,829,295 
Stockholders' equity 4,956,778   4,930,182   4,890,746   4,818,889   4,815,965 
          
(1) Annualized. 
(2) Non-GAAP measure.
(3) Tax equivalent.
 



PACWEST BANCORP AND SUBSIDIARIES
FIVE QUARTER SELECTED FINANCIAL DATA
 
 At or For the Three Months Ended
 March 31, December 31, September 30, June 30, March 31,
  2020   2019   2019   2019   2019 
                    
 (Dollars in thousands)
Credit Quality Ratios:         
Nonaccrual loans and leases held for         
investment to loans and leases         
held for investment 0.48%  0.49%  0.53%  0.44%  0.48%
Nonperforming assets to loans and         
leases held for investment and         
foreclosed assets 0.49%  0.49%  0.54%  0.45%  0.50%
Classified loans and leases held for         
investment to loans and leases         
held for investment 0.75%  0.93%  1.01%  1.03%  1.04%
Provision for credit losses (for the         
quarter) to average loans and leases         
held for investment (annualized) 2.36%  0.06%  0.15%  0.18%  0.09%
Net charge-offs (for the quarter) to         
average loans and leases held         
for investment (annualized) 0.40%  0.02%  0.10%  0.25%  0.00%
Trailing 12 months net charge-offs         
to average loans and leases         
held for investment 0.19%  0.09%  0.20%  0.18%  0.22%
Allowance for credit losses to loans         
and leases held for investment 1.39%  0.93%  0.92%  0.92%  0.95%
Allowance for credit losses to         
nonaccrual loans and leases         
held for investment 287.5%  189.1%  174.0%  209.1%  195.6%
          
PacWest Bancorp Consolidated          
Capital:         
Tier 1 leverage ratio (1) 8.64%  9.74%  9.50%  9.49%  9.38%
Common equity tier 1 capital ratio (1) 9.23%  9.78%  9.55%  9.53%  9.48%
Tier 1 capital ratio (1) 9.23%  9.78%  9.55%  9.53%  9.48%
Total capital ratio (1) 12.21%  12.41%  12.16%  12.18%  12.15%
Risk-weighted assets (1)$24,178,995  $23,582,495  $23,579,614  $23,117,199  $22,939,074 
          
Equity to assets ratio 12.97%  18.51%  18.41%  18.42%  18.20%
Tangible common equity ratio (2) 9.10%  9.79%  9.65%  9.50%  9.23%
Book value per share$28.75  $41.36  $41.06  $40.49  $39.86 
Tangible book value per share (2)$19.31  $19.77  $19.43  $18.83  $18.22 
          
Pacific Western Bank Capital:         
Tier 1 leverage ratio (1) 9.72%  10.95%  10.72%  10.76%  10.57%
Common equity tier 1 capital ratio (1) 10.39%  11.00%  10.79%  10.80%  10.69%
Tier 1 capital ratio (1) 10.39%  11.00%  10.79%  10.80%  10.69%
Total capital ratio (1) 11.53%  11.74%  11.52%  11.53%  11.45%
          
(1) Capital information for March 31, 2020 is preliminary. 
(2) 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
 March 31, December 31, March 31,
Return on Average Tangible Equity 2020   2019   2019 
            
 (Dollars in thousands)
Net (loss) earnings$(1,433,111) $117,881  $112,604 
Add: Intangible asset amortization 3,948   -   - 
Add: Goodwill amortization 1,470,000   -   - 
Adjusted net earnings$40,837  $117,881  $112,604 
      
      
Average stockholders' equity$4,956,778  $4,930,182  $4,815,965 
Less: Average intangible assets 2,569,189   2,589,217   2,603,842 
Average tangible common equity$2,387,589  $2,340,965  $2,212,123 
      
Return on average equity (1) (116.28)%  9.49%  9.48%
Return on average tangible equity (2) 6.88%  19.98%  20.64%
      
(1) Annualized net earnings divided by average stockholders' equity.  
(2) Annualized adjusted net earnings divided by average tangible common equity.  
      



          
Tangible Common Equity Ratio/March 31, December 31, September 30, June 30, March 31,
Tangible Book Value Per Share 2020   2019   2019   2019   2019 
                    
 (Dollars in thousands, except per share data)
Stockholders' equity$3,390,389  $4,954,697  $4,920,108  $4,852,010  $4,790,982 
Less: Intangible assets 1,113,116   2,587,064   2,591,217   2,596,050   2,600,920 
Tangible common equity$2,277,273  $2,367,633  $2,328,891  $2,255,960  $2,190,062 
          
Total assets$26,143,267  $26,770,806  $26,724,627  $26,344,414  $26,324,138 
Less: Intangible assets 1,113,116   2,587,064   2,591,217   2,596,050   2,600,920 
Tangible assets$25,030,151  $24,183,742  $24,133,410  $23,748,364  $23,723,218 
          
Equity to assets ratio 12.97%  18.51%  18.41%  18.42%  18.20%
Tangible common equity ratio (1) 9.10%  9.79%  9.65%  9.50%  9.23%
          
Book value per share$28.75  $41.36  $41.06  $40.49  $39.86 
Tangible book value per share (2)$19.31  $19.77  $19.43  $18.83  $18.22 
Shares outstanding 117,916,789   119,781,605   119,831,192   119,829,104   120,201,149 
          
(1) Tangible common equity divided by tangible assets.        
(2) Tangible common equity divided by shares outstanding.        
          


Contact:Matthew P. Wagner Patrick J. Rusnak
 President and CEO Executive Vice President and CFO
Phone:310-887-8520 714-989-4705