Banc of California Reports First Quarter 2019 Earnings

April 23, 2019

April 23, 2019 - 5:00 AM EDT

Banc of California Reports First Quarter 2019 Earnings

SANTA ANA, Calif.

Banc of California, Inc. (NYSE: BANC) today reported net income
available to common stockholders of $2.7 million, for the first quarter
of 2019, resulting in diluted earnings per common share of $0.05 for the
quarter.

Highlights for the first quarter included:

Core Deposits: Core deposit balances were up to $6.3 billion
from $6.2 billion in the prior quarter and $5.7 billion a year ago.
- Wholesale funding mix is 24% in the first quarter, down from 30%
  at the end of 2018.
- Noninterest bearing deposits increased by $97 million.
HFI Loan Balances: Held for investment loans decreased by $144
million during the quarter to $7.6 billion.
- Gross loan commitment originations totaled $521 million for the
  first quarter at an average production yield of 5.29%.
- Sales of single family loans totaled $243 million.
Asset Re-Mix: Investment securities balance declined by $521
million during the quarter and represented 15% of total assets at
quarter end, down from 19% at the end of the prior quarter and 23%
from a year ago.
Noninterest Expenses: First quarter noninterest expenses
totaled $61.8 million, up from $49.6 million for the fourth quarter,
driven by a seasonal increase in salaries and benefits combined with
increased professional fees and restructuring expenses.
Credit Performance: Non-performing assets to total assets at
quarter end were 0.29% and total delinquent loans to total loans at
quarter end were 0.79%, compared to 0.21% and 0.53%, respectively, at
the prior quarter end. Net charge-offs during the quarter totaled $1.1
million, compared with $2.5 million during the prior quarter. The ALLL
/ total loan ratio was 0.85% at quarter end, up from 0.81% at the
prior quarter end and 0.79% a year ago.
Strong Capital Ratios: Common equity tier 1 capital ratio at
quarter end of 9.72%, compared to 9.53% at the prior quarter end and
9.80% a year ago.

Capital actions:

Dividend Reduction: The Company’s Board of Directors approved a
plan to reduce the quarterly dividend from $0.13 to $0.06 per common
share.

The Company’s first quarter results included $11.0 million of legal and
professional fees and $2.8 million in restructuring expenses, offset by
a $4.7 million insurance recovery related to ongoing indemnification
expenses.

“The first quarter results, and particularly actions taken at the end of
the quarter, reflect continued effort toward our strategic
transformation,” said Jared Wolff, President and Chief Executive Officer
of Banc of California. “We increased our core deposits during the
quarter by $58 million and more importantly, increased our noninterest
bearing deposits by $97 million. Additionally, we decreased our
wholesale funding balance to 24% of total funding. Credit quality
remained strong with non-performing assets to total assets at 0.29% at
quarter end.”

Mr. Wolff continued, “This will be my first quarterly earnings call as
the company’s President and CEO, and I am honored to be leading Banc of
California at such an exciting time for the company. We have a great
brand, very talented people at all levels and are located in one of the
best banking markets in the country with the expertise, products and
platform necessary to be one of the premier community banking franchises
in California. I look forward to accelerating the company’s
transformation and continuing to build long term value for our
stockholders.”

The Company will host a conference call to discuss its first quarter
2019 financial results at 10:00 a.m. Pacific Time (PT) on Tuesday, April
23, 2019. Interested parties are welcome to attend the conference call
by dialing 888-317-6003, and referencing event code 4703060. A live
audio webcast will also be available and the webcast link will be posted
on the Company’s Investor Relations website at www.bancofcal.com/investor.
The slide presentation for the call will also be available on the
Company's Investor Relations website prior to the call.

About Banc of California, Inc.

Banc of California, Inc. (NYSE: BANC) is a bank holding company with
approximately $10 billion in assets and one wholly-owned banking
subsidiary, Banc of California, N.A. (the “Bank”). The Bank has 43
offices including 32 full-service branches located throughout Southern
California. Through our 750+ dedicated professionals, we provide
customized and innovative banking and lending solutions to businesses,
entrepreneurs and individuals throughout California. We help our clients
grow their businesses, purchase a home, create jobs, transform
neighborhoods, enrich communities and empower their dreams. We also help
to improve the communities where we live and work, by supporting
organizations that provide financial literacy and job training, small
business support and affordable housing. With a commitment to service
and building enduring relationships, we provide a higher standard of
banking. We look forward to helping you achieve your goals. For more
information, please visit us at www.bancofcal.com.

Forward-Looking Statements

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


Banc of California, Inc.
Consolidated Statements of Financial Condition
(Dollars in thousands)
(Unaudited)

	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
ASSETS
Cash and cash equivalents	$	304,705		$	391,592		$	372,221		$	385,691		$	346,704
Securities available-for-sale		1,471,303			1,992,500			2,059,832			2,297,124			2,424,593
Loans held-for-sale		25,191			8,116			9,382			13,753			20,180
Loans and leases receivable		7,557,200			7,700,873			7,253,293			7,036,004			6,930,507
Allowance for loan and lease losses		(63,885	)		(62,192	)		(57,782	)		(56,678	)		(54,763	)
Federal Home Loan Bank and other bank stock		55,794			68,094			71,308			75,737			82,715
Servicing rights, net		3,053			3,428			3,770			3,869			6,739
Other real estate owned, net		316			672			434			710			1,024
Premises and equipment, net		130,417			129,394			133,129			135,478			135,198
Investments in alternative energy partnerships, net		26,578			28,988			41,781			44,806			48,344
Goodwill		37,144			37,144			37,144			37,144			37,144
Other intangible assets, net		5,726			6,346			6,990			7,683			8,510
Deferred income tax, net		45,111			49,404			47,865			42,334			43,192
Income tax receivable		4,787			2,695			1,764			7,995			10,126
Bank owned life insurance investment		107,552			107,027			106,468			105,917			105,384
Right of use assets		24,519			-			-			-			-
Other assets		151,014			146,496			152,933			155,298			153,834
Assets of discontinued operations		-			19,490			20,290			26,415			29,888
Total assets	$	9,886,525		$	10,630,067		$	10,260,822		$	10,319,280		$	10,329,319

LIABILITIES AND STOCKHOLDERS’ EQUITY
Noninterest-bearing deposits	$	1,120,700		$	1,023,360		$	1,061,557		$	1,005,032		$	1,039,116
Interest-bearing deposits		6,604,232			6,893,284			6,340,185			6,130,762			6,071,049
Total deposits		7,724,932			7,916,644			7,401,742			7,135,794			7,110,165
Advances from Federal Home Loan Bank		935,000			1,520,000			1,640,000			1,805,000			1,905,000
Notes payable, net		173,203			173,174			173,096			173,017			172,966
Reserve for loss on repurchased loans		2,486			2,506			2,575			3,149			3,426
Lease liabilities		25,893			-			-			-			-
Due on unsettled securities purchases		-			-			17,500			132,546			59,000
Accrued expenses and other liabilities		76,686			72,209			79,231			81,086			84,997
Liabilities of discontinued operations		-			-			-			-			9
Total liabilities		8,938,200			9,684,533			9,314,144			9,330,592			9,335,563
Commitments and contingent liabilities
Preferred stock		231,128			231,128			231,128			269,071			269,071
Common stock		518			518			518			517			517
Common stock, class B non-voting non-convertible		5			5			5			4			5
Additional paid-in capital		626,608			625,834			624,789			623,372			623,483
Retained earnings		136,943			140,952			140,971			143,880			141,008
Treasury stock		(28,786	)		(28,786	)		(28,786	)		(28,786	)		(28,786	)
Accumulated other comprehensive (loss) income, net		(18,091	)		(24,117	)		(21,947	)		(19,370	)		(11,542	)
Total stockholders’ equity		948,325			945,534			946,678			988,688			993,756
Total liabilities and stockholders’ equity	$	9,886,525		$	10,630,067		$	10,260,822		$	10,319,280		$	10,329,319


Banc of California, Inc.
Consolidated Statements of Operations
(Dollars in thousands, except per share data)
(Unaudited)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
Interest and dividend income
Loans, including fees	$	90,558		$	88,258		$	84,795		$	81,307		$	74,912
Securities		17,841			19,882			20,599			21,455			21,631
Other interest-earning assets		2,313			2,990			2,380			2,423			2,164
Total interest and dividend income		110,712			111,130			107,774			105,185			98,707
Interest expense
Deposits		31,443			28,972			25,154			20,315			16,795
Federal Home Loan Bank advances		9,081			9,068			8,996			9,539			7,392
Securities sold under repurchase agreements		18			25			47			211			750
Notes payable and other interest-bearing liabilities		2,362			2,383			2,385			2,356			2,332
Total interest expense		42,904			40,448			36,582			32,421			27,269
Net interest income		67,808			70,682			71,192			72,764			71,438
Provision for loan and lease losses		2,512			6,653			1,410			2,653			19,499
Net interest income after provision for loan and lease losses		65,296			64,029			69,782			70,111			51,939
Noninterest income
Customer service fees		1,515			1,786			1,446			1,491			1,592
Loan servicing income (loss)		118			22			439			948			2,311
Impairment loss on investment securities		-			(3,252	)		-			-			-
Net gain on sale of securities available for sale		208			-			13			278			5,241
Net gain (loss) on sale of loans		1,553			873			279			821			(41	)
All other income (loss)		2,901			3,019			2,647			4,523			(521	)
Total noninterest income		6,295			2,448			4,824			8,061			8,582
Noninterest expense
Salaries and employee benefits		28,439			24,587			24,832			29,440			31,115
Occupancy and equipment		7,686			8,064			8,213			7,883			7,687
Professional fees		11,041			6,206			11,966			6,303			9,177
Data processing		1,496			1,733			1,884			1,678			1,656
Advertising		2,057			3,371			3,152			2,864			3,277
Regulatory assessments		2,482			1,252			2,138			2,196			2,092
Reversal of provision for loan repurchases		(116	)		(122	)		(360	)		(218	)		(1,788	)
Amortization of intangible assets		620			644			693			827			843
Restructuring expense		2,795			(105	)		553			3,983			-
All other expenses		3,385			3,153			5,322			5,775			5,775
Total noninterest expense excluding loss (gain) on investments in alternative energy partnerships		59,885			48,783			58,393			60,731			59,834
Loss (gain) on investments in alternative energy partnerships		1,950			786			2,484			1,808			(34	)
Total noninterest expense		61,835			49,569			60,877			62,539			59,800
Income from continuing operations before income taxes		9,756			16,908			13,729			15,633			721
Income tax expense (benefit)		2,719			6,117			3,301			1,779			(6,353	)
Income from continuing operations		7,037			10,791			10,428			13,854			7,074
Income from discontinued operations before income taxes		-			347			924			1,281			2,044
Income tax expense		-			100			256			355			560
Income from discontinued operations		-			247			668			926			1,484
Net income		7,037			11,038			11,096			14,780			8,558
Preferred stock dividends		4,308			4,308			4,970			5,113			5,113
Impact of preferred stock redemption		-			-			2,307			-			-
Net income available to common stockholders	$	2,729		$	6,730		$	3,819		$	9,667		$	3,445
Basic earnings per common share
Income from continuing operations	$	0.05		$	0.12		$	0.06		$	0.17		$	0.03
Income from discontinued operations		-			0.01			0.01			0.02			0.03
Net income	$	0.05		$	0.13		$	0.07		$	0.19		$	0.06
Diluted earnings per common share
Income from continuing operations	$	0.05		$	0.12		$	0.06		$	0.16		$	0.03
Income from discontinued operations		-			0.01			0.01			0.02			0.03
Net income	$	0.05		$	0.13		$	0.07		$	0.18		$	0.06
Weighted average number of common shares outstanding
Basic		50,676,722			50,651,805			50,656,076			50,593,429			50,590,545
Diluted		50,846,722			50,812,874			50,899,464			50,919,091			50,925,530
Dividends declared per common share	$	0.13		$	0.13		$	0.13		$	0.13		$	0.13


Banc of California, Inc.
Selected Financial Data
(Dollars in thousands)
(Unaudited)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
Profitability and other ratios of consolidated operations
Return on average assets⁽¹⁾		0.28	%		0.43	%		0.43	%		0.58	%		0.34	%
Return on average equity ⁽¹⁾		2.98	%		4.56	%		4.40	%		5.92	%		3.40	%
Return on average tangible common equity ⁽²⁾		1.91	%		4.19	%		2.49	%		6.03	%		2.37	%
Dividend payout ratio ⁽³⁾		260.00	%		100.00	%		185.71	%		68.42	%		216.67	%
Net interest spread		2.47	%		2.56	%		2.62	%		2.75	%		2.74	%
Net interest margin⁽¹⁾		2.81	%		2.88	%		2.93	%		3.01	%		2.98	%
Noninterest income to total revenue ⁽⁴⁾		8.49	%		3.60	%		7.42	%		11.16	%		12.73	%
Noninterest income to average total assets⁽¹⁾		0.25	%		0.10	%		0.22	%		0.36	%		0.41	%
Noninterest expense to average total assets⁽¹⁾		2.43	%		1.92	%		2.38	%		2.45	%		2.36	%
Efficiency ratio⁽⁵⁾		83.44	%		67.47	%		79.15	%		76.17	%		72.87	%
Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships ^{(2) , (5)}		83.00	%		67.09	%		77.88	%		73.50	%		65.70	%
Average held-for-investment loans and leases to average deposits		100.45	%		97.40	%		97.00	%		98.63	%		94.87	%
Average investment securities to average total assets		17.00	%		19.85	%		21.28	%		22.27	%		24.60	%
Average stockholders’ equity to average total assets		9.29	%		9.38	%		9.85	%		9.78	%		9.94	%
Allowance for loan and lease losses (ALLL)
Balance at beginning of period	$	62,192		$	57,782		$	56,678		$	54,763		$	49,333
Loans and leases charged off		(1,063	)		(2,522	)		(388	)		(950	)		(14,639	)
Recoveries		244			279			82			212			570
Provision for loan and lease losses		2,512			6,653			1,410			2,653			19,499
Balance at end of period	$	63,885		$	62,192		$	57,782		$	56,678		$	54,763
Annualized net loan charge-offs to average total loans and leases held-for-investment		0.04	%		0.12	%		0.02	%		0.04	%		0.84	%
Reserve for loss on repurchased loans
Balance at beginning of period	$	2,506		$	2,575		$	3,149		$	3,426		$	6,306
Reversal of provision for loan repurchases		(20	)		(69	)		(342	)		(165	)		(1,786	)
Utilization of reserve for loan repurchases		-			-			(232	)		(112	)		(1,094	)
Balance at end of period	$	2,486		$	2,506		$	2,575		$	3,149		$	3,426

(1)		Ratios are presented on an annualized basis.
(2)		The ratios are determined by methods other than in accordance with U.S. generally accepted accounting principles (GAAP).
		See Non-GAAP measures section for reconciliation of the calculation.
(3)		The ratio is calculated by dividing dividends declared per common share by basic earnings per common share.
(4)		Total revenue is equal to the sum of net interest income before provision for loan and lease losses and noninterest income.
(5)		The ratios are calculated by dividing noninterest expense by the sum of net interest income before provision for loan and lease losses and noninterest income.


Banc of California, Inc.
Selected Financial Data, Continued
(Dollars in thousands)
(Unaudited)

	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
Asset quality information and ratios
Delinquent loans and leases held-for-investment
30 to 89 days delinquent	$	44,840		$	26,684		$	20,265		$	15,097		$	31,936
90+ days delinquent		14,623			13,846			15,269			11,453			11,526
Total delinquent loans	$	59,463		$	40,530		$	35,534		$	26,550		$	43,462
Total delinquent loans and leases to total loans and leases		0.79	%		0.53	%		0.49	%		0.38	%		0.63	%
Non-performing assets, excluding loans held-for-sale
Non-performing loans and leases	$	27,739		$	21,585		$	25,523		$	22,290		$	21,220
90+ days delinquent and still accruing loans and leases		731			470			-			-			-
Other real estate owned		316			672			434			710			1,024
Non-performing assets	$	28,786		$	22,727		$	25,957		$	23,000		$	22,244
ALLL to non-performing loans and leases		224.40	%		281.99	%		226.39	%		254.28	%		258.07	%
Non-performing loans and leases to total loans and leases		0.38	%		0.29	%		0.35	%		0.32	%		0.31	%
Non-performing assets to total assets		0.29	%		0.21	%		0.25	%		0.22	%		0.22	%
Troubled debt restructurings (TDRs)
Performing TDRs	$	5,574		$	5,745		$	5,580		$	5,648		$	5,787
Non-performing TDRs		1,943			2,276			2,684			2,701			2,632
Total TDRs	$	7,517		$	8,021		$	8,264		$	8,349		$	8,419
Loans and leases and ALLL by loan origination type
Loan and lease breakdown by origination type
Originated loans and leases	$	6,991,056		$	7,105,171		$	6,683,683		$	6,446,127		$	6,295,843
Acquired loans not impaired at acquisition		566,144			595,702			569,610			589,877			634,664
Total loans and leases	$	7,557,200		$	7,700,873		$	7,253,293		$	7,036,004		$	6,930,507
ALLL breakdown by origination type
Originated loans and leases	$	63,003		$	61,256		$	56,672		$	55,534		$	53,605
Acquired loans not impaired at acquisition		882			937			1,110			1,144			1,158
Total ALLL	$	63,885		$	62,193		$	57,782		$	56,678		$	54,763
Discount on Purchased/Acquired Loans
Acquired loans not impaired at acquisition	$	11,184		$	11,645		$	12,311		$	12,932		$	14,255
Total Discount	$	11,184		$	11,645		$	12,311		$	12,932		$	14,255
Percentage of ALLL to:
Originated loans and leases		0.90	%		0.86	%		0.85	%		0.86	%		0.85	%
Originated loans and leases and acquired loans not impaired at acquisition		0.85	%		0.81	%		0.80	%		0.81	%		0.79	%
Total loans and leases		0.85	%		0.81	%		0.80	%		0.81	%		0.79	%


Banc of California, Inc.
Selected Financial Data, Continued
(Dollars in thousands)
(Unaudited)

	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
Composition of held-for-investment loans and leases
Commercial real estate	$	865,521		$	867,013		$	823,193		$	793,855		$	773,193
Multifamily		2,332,527			2,241,246			2,112,190			1,959,965			1,944,082
Construction		211,549			203,976			200,294			211,110			200,766
Commercial and industrial		1,907,102			1,944,142			1,673,055			1,742,559			1,638,559
SBA		74,998			68,741			71,494			78,092			79,022
Lease financing		-			-			-			-			3
Total commercial loans		5,391,697			5,325,118			4,880,226			4,785,581			4,635,625
Single family residential mortgage		2,102,694			2,305,490			2,300,069			2,174,183			2,201,358
Other consumer		62,809			70,265			72,998			76,240			93,524
Total consumer loans		2,165,503			2,375,755			2,373,067			2,250,423			2,294,882
Total gross loans and leases	$	7,557,200		$	7,700,873		$	7,253,293		$	7,036,004		$	6,930,507
Composition percentage of held-for-investment loans and leases
Commercial real estate		11.5	%		11.3	%		11.3	%		11.3	%		11.2	%
Multifamily		30.9	%		29.2	%		29.1	%		27.9	%		28.1	%
Construction		2.8	%		2.6	%		2.8	%		3.0	%		2.9	%
Commercial and industrial		25.2	%		25.2	%		23.1	%		24.8	%		23.6	%
SBA		1.0	%		0.9	%		1.0	%		1.1	%		1.1	%
Lease financing		0.0	%		0.0	%		0.0	%		0.0	%		0.0	%
Total commercial loans		71.4	%		69.2	%		67.3	%		68.1	%		66.9	%
Single family residential mortgage		27.8	%		29.9	%		31.7	%		30.9	%		31.8	%
Other consumer		0.8	%		0.9	%		1.0	%		1.0	%		1.3	%
Total consumer loans		28.6	%		30.8	%		32.7	%		31.9	%		33.1	%
Total gross loans and leases		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%
Composition of deposits
Noninterest-bearing checking	$	1,120,700		$	1,023,360		$	1,061,557		$	1,005,032		$	1,039,116
Interest-bearing checking		1,573,499			1,556,410			1,713,790			1,778,400			1,864,629
Money market		899,330			873,153			856,886			1,136,335			1,091,735
Savings		1,151,442			1,265,847			1,269,489			1,175,275			1,051,267
Brokered certificates of deposit		1,295,066			1,543,269			987,771			686,203			974,706
Non-brokered certificates of deposit		1,684,895			1,654,605			1,512,249			1,354,549			1,088,712
Total deposits	$	7,724,932		$	7,916,644		$	7,401,742		$	7,135,794		$	7,110,165
Composition percentage of deposits
Noninterest-bearing checking		14.5	%		12.9	%		14.3	%		14.1	%		14.6	%
Interest-bearing checking		20.4	%		19.7	%		23.2	%		24.9	%		26.2	%
Money market		11.6	%		11.0	%		11.6	%		15.9	%		15.4	%
Savings		14.9	%		16.0	%		17.2	%		16.5	%		14.8	%
Brokered certificates of deposit		16.8	%		19.5	%		13.3	%		9.6	%		13.7	%
Non-brokered certificates of deposit		21.8	%		20.9	%		20.4	%		19.0	%		15.3	%
Total deposits		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%
Capital Ratios
Banc of California, Inc.
Total risk-based capital ratio		14.01	%		13.71	%		14.05	%		14.71	%		14.60	%
Tier 1 risk-based capital ratio		13.03	%		12.77	%		13.15	%		13.83	%		13.74	%
Common equity tier 1 capital ratio		9.72	%		9.53	%		9.80	%		9.90	%		9.80	%
Tier 1 leverage ratio		8.87	%		8.95	%		8.99	%		9.30	%		9.21	%
Banc of California, NA
Total risk-based capital ratio		15.79	%		15.71	%		15.94	%		16.63	%		16.53	%
Tier 1 risk-based capital ratio		14.81	%		14.77	%		15.04	%		15.74	%		15.67	%
Common equity tier 1 capital ratio		14.81	%		14.77	%		15.04	%		15.74	%		15.67	%
Tier 1 leverage ratio		10.07	%		10.36	%		10.29	%		10.58	%		10.50	%


Banc of California, Inc.
Average Balance, Average Yield Earned, and Average Cost Paid
(Dollars in thousands)
(Unaudited)

	Three Months Ended
	March 31, 2019							December 31, 2018							September 30, 2018
	Average					Yield		Average					Yield		Average					Yield
	Balance			Interest		/ Cost		Balance			Interest		/ Cost		Balance			Interest		/ Cost
Interest earning assets
Loans held-for-sale ⁽¹⁾	$	31,374		$	228	2.95	%	$	33,243		$	221	2.64	%	$	42,754		$	263	2.44	%
SFR mortgage		2,312,900			24,062	4.22	%		2,260,205			23,585	4.14	%		2,222,602			23,461	4.19	%
Commercial real estate, multifamily, and construction		3,387,698			38,117	4.56	%		3,246,860			37,403	4.57	%		3,091,706			35,838	4.60	%
Commercial and industrial, SBA, and lease financing		1,920,220			27,235	5.75	%		1,791,708			26,219	5.81	%		1,739,711			24,382	5.56	%
Other consumer		62,558			916	5.94	%		68,479			990	5.74	%		69,600			981	5.59	%
Gross loans and leases		7,714,750			90,558	4.76	%		7,400,495			88,418	4.74	%		7,166,373			84,925	4.70	%
Securities		1,751,509			17,841	4.13	%		2,032,632			19,882	3.88	%		2,163,037			20,599	3.78	%
Other interest-earning assets		321,823			2,313	2.91	%		318,419			2,990	3.73	%		335,160			2,380	2.82	%
Total interest-earning assets		9,788,082			110,712	4.59	%		9,751,546			111,290	4.53	%		9,664,570			107,904	4.43	%
Allowance for loan and lease losses		(61,924	)						(58,099	)						(56,730	)
BOLI and non-interest earning assets		575,559							544,302							554,636
Total assets	$	10,301,717						$	10,237,749						$	10,162,476

Interest-bearing liabilities
Savings	$	1,201,802			5,480	1.85	%	$	1,279,155			5,663	1.76	%	$	1,231,696			5,122	1.65	%
Interest-bearing checking		1,554,846			4,525	1.18	%		1,666,884			4,916	1.17	%		1,789,679			5,054	1.12	%
Money market		887,538			4,128	1.89	%		803,157			3,168	1.56	%		966,165			3,455	1.42	%
Certificates of deposit		2,982,980			17,310	2.35	%		2,759,665			15,225	2.19	%		2,332,181			11,523	1.96	%
Total interest-bearing deposits		6,627,166			31,443	1.92	%		6,508,861			28,972	1.77	%		6,319,721			25,154	1.58	%
FHLB advances		1,422,100			9,081	2.59	%		1,447,348			9,068	2.49	%		1,528,674			8,996	2.33	%
Securities sold under repurchase agreements		2,350			18	3.11	%		3,116			25	3.18	%		6,418			47	2.91	%
Long-term debt and other interest-bearing liabilities		174,230			2,362	5.50	%		174,281			2,383	5.42	%		174,361			2,385	5.43	%
Total interest-bearing liabilities		8,225,846			42,904	2.12	%		8,133,606			40,448	1.97	%		8,029,174			36,582	1.81	%
Noninterest-bearing deposits		1,021,741							1,054,790							1,023,890
Non-interest-bearing liabilities		97,430							89,111							108,593
Total liabilities		9,345,017							9,277,507							9,161,657
Total stockholders’ equity		956,700							960,242							1,000,819
Total liabilities and stockholders’ equity	$	10,301,717						$	10,237,749						$	10,162,476

Net interest income/spread				$	67,808	2.47				%	$	70,842	2.56				%	$	71,322	2.62	%

Net interest margin						2.81				%			2.88				%			2.93	%

Ratio of interest-earning assets to interest-bearing liabilities		118.99	%						119.89	%						120.37	%

Total deposits	$	7,648,907		$	31,443	1.67	%	$	7,563,651		$	28,972	1.52	%	$	7,343,611		$	25,154	1.36	%
Total funding ⁽²⁾	$	9,247,587		$	42,904	1.88	%	$	9,188,396		$	40,448	1.75	%	$	9,053,064		$	36,582	1.60	%

(1)		Includes loans held-for-sale of discontinued operations.
(2)		Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding.


Banc of California, Inc.
Average Balance, Average Yield Earned, and Average Cost Paid, Continued
(Dollars in thousands)
(Unaudited)

	Three Months Ended
	June 30, 2018							March 31, 2018
	Average					Yield		Average					Yield
	Balance			Interest		/ Cost		Balance			Interest		/ Cost
Interest earning assets
Loans held-for-sale ⁽¹⁾	$	54,791		$	328	2.40	%	$	97,095		$	297	1.24	%
SFR mortgage		2,223,608			22,790	4.11	%		2,122,666			21,352	4.08	%
Commercial real estate, multifamily, and construction		2,989,014			33,736	4.53	%		2,856,290			31,439	4.46	%
Commercial and industrial, SBA, and lease financing		1,707,478			23,664	5.56	%		1,625,549			20,850	5.20	%
Other consumer		80,188			978	4.89	%		103,676			1,160	4.54	%
Gross loans and leases		7,055,079			81,496	4.63	%		6,805,276			75,098	4.48	%
Securities		2,279,416			21,455	3.78	%		2,525,220			21,631	3.47	%
Other interest-earning assets		392,342			2,423	2.48	%		407,064			2,164	2.16	%
Total interest-earning assets		9,726,837			105,374	4.35	%		9,737,560			98,893	4.12	%
Allowance for loan and lease losses		(54,903	)						(49,257	)
BOLI and non-interest earning assets		565,224							574,930
Total assets	$	10,237,158						$	10,263,233

Interest-bearing liabilities
Savings	$	1,055,693			3,886	1.48	%	$	1,055,338			3,300	1.27	%
Interest-bearing checking		1,822,856			4,182	0.92	%		1,976,160			4,108	0.84	%
Money market		1,134,280			3,689	1.30	%		1,076,117			2,834	1.07	%
Certificates of deposit		2,079,932			8,558	1.65	%		1,906,556			6,553	1.39	%
Total interest-bearing deposits		6,092,761			20,315	1.34	%		6,014,171			16,795	1.13	%
FHLB advances		1,827,307			9,539	2.09	%		1,711,089			7,392	1.75	%
Securities sold under repurchase agreements		29,907			211	2.83	%		119,543			750	2.54	%
Long-term debt and other interest-bearing liabilities		174,296			2,356	5.42	%		174,424			2,332	5.42	%
Total interest-bearing liabilities		8,124,271			32,421	1.60	%		8,019,227			27,269	1.38	%
Noninterest-bearing deposits		1,004,502							1,056,700
Non-interest-bearing liabilities		107,529							167,345
Total liabilities		9,236,302							9,243,272
Total stockholders’ equity		1,000,856							1,019,961
Total liabilities and stockholders’ equity	$	10,237,158						$	10,263,233

Net interest income/spread				$	72,953	2.75	%				$	71,624	2.74	%

Net interest margin						3.01	%						2.98	%

Ratio of interest-earning assets to interest-bearing liabilities		119.73	%						121.43	%

Total deposits	$	7,097,263		$	20,315	1.15	%	$	7,070,871		$	16,795	0.96	%
Total funding ⁽²⁾	$	9,128,773		$	32,421	1.42	%	$	9,075,927		$	27,269	1.22	%

(1)		Includes loans held-for-sale of discontinued operations.
(2)		Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total funding.

Banc of California, Inc.

Consolidated Operations

Non-GAAP Measures

(Dollars in thousands, except per share data)

(Unaudited)

Under Item 10(e) of SEC Regulation S-K, public companies disclosing
financial measures in filings with the SEC that are not calculated
in accordance with GAAP must also disclose, along with each non-GAAP
financial measure, certain additional information, including a
presentation of the most directly comparable GAAP financial measure,
a reconciliation of the non-GAAP financial measure to the most
directly comparable GAAP financial measure, as well as a statement
of the reasons why the company’s management believes that
presentation of the non-GAAP financial measure provides useful
information to investors regarding the company’s financial condition
and results of operations and, to the extent material, a statement
of the additional purposes, if any, for which the company’s
management uses the non-GAAP financial measure.

Return on average tangible common equity and efficiency ratio, as
adjusted, tangible common equity to tangible assets, and tangible
common equity per common share constitute supplemental financial
information determined by methods other than in accordance with
GAAP. These non-GAAP measures are used by management in its analysis
of the Company's performance.

Tangible common equity is calculated by subtracting preferred stock,
goodwill, and other intangible assets from stockholders’ equity.
Tangible assets is calculated by subtracting goodwill and other
intangible assets from total assets. Banking regulators also exclude
goodwill and other intangible assets from stockholders’ equity when
assessing the capital adequacy of a financial institution.

Adjusted efficiency ratio is calculated by subtracting loss on
investments in alternative energy partnerships from noninterest
expense and adding total pre-tax return, which includes the loss on
investments in alternative energy partnerships, to the sum of net
interest income and noninterest income (total revenue). Management
believes the presentation of these financial measures adjusting the
impact of these items provides useful supplemental information that
is essential to a proper understanding of the financial results and
operating performance of the Company.

This disclosure should not be viewed as a substitute for results
determined in accordance with GAAP, nor is it necessarily comparable
to non-GAAP performance measures that may be presented by other
companies.

The following tables provide reconciliations of the non-GAAP
measures with financial measures defined by GAAP.

	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
Tangible common equity to tangible assets ratio
Total assets	$	9,886,525		$	10,630,067		$	10,260,822		$	10,319,280		$	10,329,319
Less goodwill		(37,144	)		(37,144	)		(37,144	)		(37,144	)		(37,144	)
Less other intangible assets		(5,726	)		(6,346	)		(6,990	)		(7,683	)		(8,510	)
Tangible assets	$	9,843,655		$	10,586,577		$	10,216,688		$	10,274,453		$	10,283,665

Total stockholders' equity	$	948,325		$	945,534		$	946,678		$	988,688		$	993,756
Less goodwill		(37,144	)		(37,144	)		(37,144	)		(37,144	)		(37,144	)
Less other intangible assets		(5,726	)		(6,346	)		(6,990	)		(7,683	)		(8,510	)
Tangible equity		905,455			902,044			902,544			943,861			948,102
Less preferred stock		(231,128	)		(231,128	)		(231,128	)		(269,071	)		(269,071	)
Tangible common equity	$	674,327		$	670,916		$	671,416		$	674,790		$	679,031

Total stockholders' equity to total assets		9.59	%		8.89	%		9.23	%		9.58	%		9.62	%
Tangible equity to tangible assets		9.20	%		8.52	%		8.83	%		9.19	%		9.22	%
Tangible common equity to tangible assets		6.85	%		6.34	%		6.57	%		6.57	%		6.60	%

Common shares outstanding		50,315,490			50,172,018			50,180,607			50,142,955			50,079,736
Class B non-voting non-convertible common shares outstanding		477,321			477,321			477,321			403,778			508,107
Total common shares outstanding		50,792,811			50,649,339			50,657,928			50,546,733			50,587,843

Tangible common equity per common shares	$	13.28		$	13.25		$	13.25		$	13.35		$	13.42
Book value per common share	$	14.12		$	14.10		$	14.13		$	14.24		$	14.33


Banc of California, Inc.
Consolidated Operations
Non-GAAP Measures, Continued
(Dollars in thousands, except per share data)
(Unaudited)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
Return on tangible common equity
Average total stockholders' equity	$	956,700		$	960,242		$	1,000,819		$	1,000,856		$	1,019,961
Less average preferred stock		(231,128	)		(231,128	)		(260,822	)		(269,071	)		(269,071	)
Less average goodwill		(37,144	)		(37,144	)		(37,144	)		(37,144	)		(37,144	)
Less average other intangible assets		(6,128	)		(6,731	)		(7,412	)		(8,110	)		(8,972	)
Average tangible common equity	$	682,300		$	685,239		$	695,441		$	686,531		$	704,774

Net income	$	7,037		$	11,038		$	11,096		$	14,780		$	8,558
Less preferred stock dividends and impact of preferred stock redemption		(4,308	)		(4,308	)		(7,277	)		(5,113	)		(5,113	)
Add amortization of intangible assets		620			644			693			827			843
Add impairment on intangible assets		-			-			-			-			-
Less tax effect on amortization and impairment of intangible assets		(130	)		(135	)		(146	)		(174	)		(177	)
Net income available to common stockholders	$	3,219		$	7,239		$	4,366		$	10,320		$	4,111

Return on average equity		2.98	%		4.56	%		4.40	%		5.92	%		3.40	%
Return on average tangible common equity		1.91	%		4.19	%		2.49	%		6.03	%		2.37	%

Statutory tax rate utilized for calculating tax effect on amortization and impairment of intangible assets		21.00	%		21.00	%		21.00	%		21.00	%		21.00	%

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
		2019			2018			2018			2018			2018
Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships
Noninterest expense	$	61,835		$	49,578		$	60,977		$	62,554		$	59,812
(Loss) gain on investments in alternative energy partnerships		(1,950	)		(786	)		(2,484	)		(1,808	)		34
Adjusted noninterest expense	$	59,885		$	48,792		$	58,493		$	60,746		$	59,846

Net interest income	$	67,808		$	70,842		$	71,322		$	72,953		$	71,624
Noninterest income		6,295			2,644			5,718			9,168			10,452
Total revenue		74,103			73,486			77,040			82,121			82,076
Tax credit from investments in alternative energy partnerships		-			-			412			1,912			7,323
Deferred tax expense on investments in alternative energy partnerships		-			-			(43	)		(211	)		(769	)
Tax effect on tax credit and deferred tax expense		-			26			180			631			2,422
(Loss) gain on investments in alternative energy partnerships		(1,950	)		(786	)		(2,484	)		(1,808	)		34
Total pre-tax adjustments for investments in alternative energy partnerships		(1,950	)		(760	)		(1,935	)		524			9,010
Adjusted total revenue	$	72,153		$	72,726		$	75,105		$	82,645		$	91,086

Efficiency ratio		83.44	%		67.47	%		79.15	%		76.17	%		72.87	%

Adjusted efficiency ratio including the pre-tax effect of investments in alternative energy partnerships		83.00	%		67.09	%		77.88	%		73.50	%		65.70	%

Effective tax rate utilized for calculating tax effect on tax credit and deferred tax expense		27.00	%		27.42	%		32.81	%		27.07	%		26.98	%

View source version on businesswire.com: https://www.businesswire.com/news/home/20190423005385/en/

INVESTOR RELATIONS INQUIRIES:
Banc of California, Inc.
John
A. Bogler, (855) 361-2262

Source: Business Wire
(April 23, 2019 - 5:00 AM EDT)

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