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PacWest Bancorp Announces Results for the Fourth Quarter and Full Year 2020

Company Release - 01/20/2021

Fourth Quarter 2020 Highlights

  • Net Earnings of $116.8 Million, or $0.99 Per Diluted Share
  • Strong Pre-Provision, Pre-Tax Net Revenue (“PPNR”) of $163.4 Million
  • Provision for Credit Losses of $10.0 Million in Q4 Compared to $97.0 Million in Q3
  • Core Deposits Up $1.1 Billion or 5% in Q4; Represents 89% of Total Deposits
  • Strong Capital Position – CET1 Ratio of 10.53%

Full Year 2020 Highlights

  • Excluding Goodwill Impairment, Net Earnings of $232.4 Million, or $1.97 Per Diluted Share
  • Net Loss of $1.24 Billion, or $(10.61) Per Diluted Share Due to $1.47 Billion Goodwill Impairment
  • Strong Pre-Provision, Pre-Tax Net Revenue (“PPNR”) of $646.6 Million
  • Provision for Credit Losses of $339.0 Million Compared to $22.0 Million in 2019
  • Core Deposits Up $6.1 Billion or 38% in 2020
  • Strong Capital Position – Increased CET1 Ratio 75 Basis Points to 10.53% in 2020
  • Increased Allowance for Credit Losses Ratio to 2.41% (Excluding PPP Loans)

LOS ANGELES, Jan. 20, 2021 (GLOBE NEWSWIRE) -- PacWest Bancorp (Nasdaq: PACW) today announced net earnings for the fourth quarter of 2020 of $116.8 million, or $0.99 per diluted share, compared to net earnings for the third quarter of 2020 of $45.5 million, or $0.38 per diluted share. The increase in net earnings for the fourth quarter was due primarily to an $87.0 million decrease in the provision for credit losses.

Net loss for the full year 2020 was $1.24 billion, or $10.61 per diluted share, compared to net earnings for the full year 2019 of $468.6 million, or $3.90 per diluted share. The decrease in net earnings for 2020 was primarily due to a $1.47 billion goodwill impairment charge and a higher provision for credit losses attributable mainly to the significant deterioration in the economic forecast used to estimate the allowance for credit losses as a result of the COVID-19 pandemic.

Matt Wagner, President and CEO, commented, “We finished the year strong with fourth quarter earnings boosted by continued asset growth and improved credit costs. Our fourth quarter results produced a return on assets of 1.58% and a return on tangible equity of 19.63%.”

Mr. Wagner continued, “We experienced strong deposit growth again in the fourth quarter, resulting in further increases in our liquidity position. Our average on-balance sheet cash balance grew to $3.6 billion in the fourth quarter with a yield of 13 basis points. While our focus is on managing net interest income, this excess liquidity had a negative impact on our fourth quarter NIM of 46 basis points.”

Mr. Wagner added, “Our priority continues to be on mitigating potential credit losses in our portfolios, especially those portfolios impacted most by COVID-19. We are also focused on assisting our customers with applying for new PPP loans and forgiveness for their previous PPP loans during 2021.”

Mr. Wagner added, “In 2020, our operating results were significantly impacted by the economic impact of the COVID-19 pandemic. These factors resulted in the goodwill impairment in the first quarter and elevated credit loss provisions in 2020, however, our strong PPNR allowed us to internally generate capital and build our allowance for credit losses during the year. As we head into 2021 with good momentum, we will continue to focus on the safety of our employees amid the pandemic, delivering high quality service to our valued clients, while strategically managing our business to optimize profitability in this low-rate environment.”

FINANCIAL HIGHLIGHTS

                       
  At or For the       At or For the    
  Three Months Ended       Year Ended    
  December 31,   September 30,   Increase   December 31,   Increase
Financial Highlights   2020       2020     (Decrease)     2020       2019     (Decrease)
   
  (Dollars in thousands, except per share data)
Net earnings (loss) $ 116,830     $ 45,503     $ 71,327     $ (1,237,574 )   $ 468,636     $ (1,706,210 )
Diluted earnings (loss)                      
per share $ 0.99     $ 0.38     $ 0.61     $ (10.61 )   $ 3.90     $ (14.51 )
Pre-provision, pre-goodwill                      
impairment, pre-tax net                      
revenue ("PPNR") (1) $ 163,376     $ 156,174     $ 7,202     $ 646,599     $ 654,940     $ (8,341 )
Return on average assets   1.58 %     0.65 %     0.93       (4.46 )%     1.80 %     (6.26 )
PPNR return on average                      
assets (1)   2.22 %     2.22 %     -       2.33 %     2.51 %     (0.18 )
Return on average                      
tangible equity (1)   19.63 %     8.20 %     11.43       10.36 %     21.49 %     (11.13 )
                       
Yield on average loans and                      
leases (tax equivalent)   5.15 %     5.01 %     0.14       5.18 %     6.00 %     (0.82 )
Cost of average total                      
deposits   0.14 %     0.17 %     (0.03 )     0.27 %     0.77 %     (0.50 )
Net interest margin ("NIM")                      
(tax equivalent)   3.83 %     3.90 %     (0.07 )     4.05 %     4.54 %     (0.49 )
Efficiency ratio   43.6 %     45.1 %     (1.5 )     43.1 %     42.7 %     0.4  
                       
Total assets $ 29,498,442     $ 28,426,716     $ 1,071,726     $ 29,498,442     $ 26,770,806     $ 2,727,636  
Loans and leases held                      
for investment,                      
net of deferred fees $ 19,083,377     $ 19,026,200     $ 57,177     $ 19,083,377     $ 18,846,872     $ 236,505  
Noninterest-bearing                      
demand deposits $ 9,193,827     $ 9,346,744     $ (152,917 )   $ 9,193,827     $ 7,243,298     $ 1,950,529  
Core deposits $ 22,264,480     $ 21,117,629     $ 1,146,851     $ 22,264,480     $ 16,187,287     $ 6,077,193  
Total deposits $ 24,940,717     $ 23,965,695     $ 975,022     $ 24,940,717     $ 19,233,036     $ 5,707,681  
                       
As percentage of total                      
deposits:                      
Noninterest-bearing                      
demand deposits   37 %     39 %     (2 )     37 %     38 %     (1 )
Core deposits   89 %     88 %     1       89 %     84 %     5  
                       
Equity to assets ratio   12.19 %     12.26 %     (0.07 )     12.19 %     18.51 %     (6.32 )
Tangible common equity                      
ratio (1)   8.78 %     8.71 %     0.07       8.78 %     9.79 %     (1.01 )
Book value per share $ 30.36     $ 29.42     $ 0.94     $ 30.36     $ 41.36     $ (11.00 )
Tangible book value per                      
share (1) $ 21.05     $ 20.09     $ 0.96     $ 21.05     $ 19.77     $ 1.28  
                       
(1) Non-GAAP measure.                      
                       

INCOME STATEMENT HIGHLIGHTS

Net Interest Income

Net interest income increased by $7.9 million to $259.2 million for the fourth quarter of 2020 compared to $251.3 million for the third quarter of 2020 due mainly to higher income on investment securities, higher loan prepayment fees, higher recapture of nonaccrual interest, higher amortized loan fee income from PPP loan forgiveness, and lower interest expense, partially offset by a negative impact on net interest income due to the change in the earning asset mix and a lower balance of average loans and leases. The tax equivalent yield on average loans and leases was 5.15% for the fourth quarter of 2020 compared to 5.01% for the third quarter of 2020. The increase in the tax equivalent yield on average loans and leases was primarily due to higher loan prepayment fees, higher recapture of nonaccrual interest, and higher amortized loan fee income from PPP loan forgiveness in the fourth quarter as compared to the third quarter.

The tax equivalent NIM was 3.83% for the fourth quarter of 2020 compared to 3.90% for the third quarter of 2020. The decrease in the NIM was due mostly to the change in the earning asset mix. Average loans and leases decreased by $426.5 million, while the average balance of deposits in financial institutions increased by $1.0 billion and the average balance of investment securities increased by $781.1 million in the fourth quarter of 2020. This excess liquidity had a negative impact on the fourth quarter tax equivalent NIM of 46 basis points.

The cost of average total deposits decreased to 0.14% for the fourth quarter of 2020 from 0.17% for the third quarter of 2020. The lower cost of average total deposits was due primarily to the repricing of maturing brokered time deposits.

Provision for Credit Losses

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

  Three Months Ended    
  December 31,   September 30,   Increase
Provision for Credit Losses   2020     2020   (Decrease)
                     
  (In thousands)
Addition to allowance for loan and lease losses $ 21,000     $ 81,000   $ (60,000 )
(Reduction in) addition to reserve for          
unfunded loan commitments   (11,000 )     16,000     (27,000 )
Total provision for credit losses $ 10,000     $ 97,000   $ (87,000 )
           

The provision for credit losses decreased by $87.0 million to $10.0 million for the fourth quarter of 2020 compared to $97.0 million for the third quarter of 2020. This reduction reflected improvement in certain key macro-economic forecast variables, a lower provision for unfunded loan commitments, and decreased provisions for individually evaluated loans and leases.

Noninterest Income

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

  Three Months Ended    
  December 31,   September 30,   Increase
Noninterest Income   2020     2020
  (Decrease)
                       
  (In thousands)
Service charges on deposit accounts $ 3,119     $ 2,570     $ 549  
Other commissions and fees   9,974       10,541       (567 )
Leased equipment income   9,440       9,900       (460 )
Gain on sale of loans and leases   1,671       35       1,636  
Gain on sale of securities   4       5,270       (5,266 )
Other income:          
Dividends and gains on equity investments   5,064       6,945       (1,881 )
Warrant income   7,299       500       6,799  
Other   3,279       2,491       788  
Total noninterest income $ 39,850     $ 38,252     $ 1,598  

Noninterest income increased by $1.6 million to $39.9 million for the fourth quarter of 2020 compared to $38.3 million for the third quarter of 2020 due primarily to an increase of $6.8 million in warrant income attributable to higher gains from exercised warrants, and an increase of $1.6 million in gain on sale of loans and leases, offset partially by decreases of $5.3 million in gain on sale of securities and $1.9 million in dividends and gains on equity investments. The increase in the gain on sale of loans and leases resulted from the sales of $119.9 million of loans for a gain of $1.7 million in the fourth quarter compared to sales of $3.0 million for a gain of $35 thousand in the third quarter. The decrease in the gain on sale of securities resulted from minimal sales in the fourth quarter compared to sales of $17.0 million of securities for a gain of $5.3 million in the third quarter. The decrease in dividends and gains on equity investments was due primarily to lower net fair value gains on equity investments still held, offset partially by higher income from distributions on fair value equity investments.

Noninterest Expense

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

           
  Three Months Ended    
  December 31,   September 30,   Increase
Noninterest Expense   2020     2020   (Decrease)
                     
  (In thousands)
Compensation $ 73,171     $ 75,131   $ (1,960 )
Occupancy   14,083       14,771     (688 )
Data processing   6,718       6,505     213  
Other professional services   6,800       4,713     2,087  
Insurance and assessments   5,064       3,939     1,125  
Intangible asset amortization   3,172       3,751     (579 )
Leased equipment depreciation   7,501       7,057     444  
Foreclosed assets (income) expense, net   (272 )     335     (607 )
Acquisition, integration and reorganization costs   1,060       -     1,060  
Customer related expense   4,430       4,762     (332 )
Loan expense   3,926       3,499     427  
Other   10,029       8,939     1,090  
Total noninterest expense $ 135,682     $ 133,402   $ 2,280  
           

Noninterest expense increased by $2.3 million to $135.7 million for the fourth quarter of 2020 compared to $133.4 million for the third quarter of 2020 attributable primarily to increases of $2.1 million in other professional services, $1.1 million in insurance and assessments, $1.1 million in acquisition, integration and reorganization costs, and $1.1 million in other expense, offset partially by a decrease of $2.0 million in compensation expense. The increase in other professional services was due mainly to higher consulting expense. The increase in insurance and assessments expense was due to an increase in FDIC assessment expense. The increase in acquisition, integration and reorganization costs was due to advisory services. The increase in other expense was due primarily to an increase in franchise taxes. The decrease in compensation expense was due mainly to lower bonus accruals and lower stock compensation expense.

Income Taxes

The effective income tax rate was 23.8% for the fourth quarter of 2020 compared to 23.1% for the third quarter of 2020. The effective tax rate for the year ended December 31, 2020 was (6.5%), however when excluding the non-deductible goodwill impairment, the effective tax rate for the full year 2020 was 24.4%. The effective tax rate for the full year 2021 is currently estimated to be in the range of 26% to 28%.

BALANCE SHEET HIGHLIGHTS

Loans and Leases

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

  Three Months Ended   Year Ended
Roll Forward of Loans and Leases Held December 31,   September 30,   December 31,
for Investment, Net of Deferred Fees (1)   2020       2020       2020  
                       
  (Dollars in thousands)
Balance, beginning of period $ 19,026,200     $ 19,694,631     $ 18,846,872  
Additions:          
Production   1,131,165       519,671       4,243,538  
Disbursements   1,354,038       1,008,336       5,159,912  
Total production and disbursements   2,485,203       1,528,007       9,403,450  
Reductions:          
Payoffs   (1,330,321 )     (982,889 )     (3,738,754 )
Paydowns   (957,075 )     (1,160,692 )     (5,193,848 )
Total payoffs and paydowns   (2,287,396 )     (2,143,581 )     (8,932,602 )
Sales   (119,931 )     (2,979 )     (125,999 )
Transfers to foreclosed assets   (385 )     (12,594 )     (14,755 )
Charge-offs   (20,314 )     (37,284 )     (93,589 )
Total reductions   (2,428,026 )     (2,196,438 )     (9,166,945 )
Net increase (decrease)   57,177       (668,431 )     236,505  
Balance, end of period $ 19,083,377     $ 19,026,200     $ 19,083,377  
           
Weighted average rate on production (2)   4.41 %     4.95 %     3.57 %
           
(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 25 basis points to loan yields in 2020.
           

Loans and leases held for investment, net of deferred fees, increased by $57.2 million in the fourth quarter of 2020 to $19.1 billion at December 31, 2020. The majority of the increase in the loans and leases balance for the fourth quarter of 2020 related to increases in the asset-based and income producing and other residential loan classes, offset partially by decreases in the other commercial and commercial construction and land classes. The weighted average rate on fourth quarter production decreased to 4.41% due to fourth quarter production including a higher percentage of lower-rate products such as equity fund loans and multi-family loans as compared to third quarter production. The weighted average rate on new production for the year ended December 31, 2020 of 3.57% was negatively impacted by the $1.2 billion of Paycheck Protection Program (“PPP”) loans originated with a coupon rate of 1%. Excluding PPP loans, the weighted average rate on new production for the year was 4.66%. For the year ended December 31, 2020, loans and leases held for investment, net of deferred fees, increased by $236.5 million. The majority of the increase in the loans and leases balance for the year related to increases in the other commercial and residential construction and land classes, offset partially by decreases in the venture capital, asset-based, and consumer loan classes.

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

                 
  December 31, 2020   September 30, 2020   December 31, 2019
    % of     % of     % of
Loan and Lease Portfolio Balance Total   Balance Total   Balance Total
   
  (In thousands)
Real estate mortgage:                
Commercial $ 4,096,671 21 %   $ 4,192,466 22 %   $ 4,202,687 22 %
Income producing and other                
residential   3,803,265 20 %     3,684,579 19 %     3,770,060 20 %
Total real estate mortgage   7,899,936 41 %     7,877,045 41 %     7,972,747 42 %
Real estate construction and land:                
Commercial   1,117,121 6 %     1,241,647 7 %     1,082,368 6 %
Residential   2,243,160 12 %     2,182,100 11 %     1,655,434 9 %
Total real estate construction                
and land   3,360,281 18 %     3,423,747 18 %     2,737,802 15 %
Total real estate   11,260,217 59 %     11,300,792 59 %     10,710,549 57 %
Commercial:                
Asset-based   3,429,283 18 %     3,153,048 17 %     3,748,407 20 %
Venture capital   1,698,508 9 %     1,637,132 9 %     2,179,422 12 %
Other commercial   2,375,114 12 %     2,572,994 13 %     1,767,667 9 %
Total commercial   7,502,905 39 %     7,363,174 39 %     7,695,496 41 %
Consumer   320,255 2 %     362,234 2 %     440,827 2 %
Total loans and leases held for                
investment, net of deferred fees $ 19,083,377 100 %   $ 19,026,200 100 %   $ 18,846,872 100 %
                 
Total unfunded loan commitments $ 7,601,390     $ 7,178,506     $ 8,183,158  
                       

Allowance for Credit Losses

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

           
  Three Months Ended December 31, 2020
  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 $ 345,966     $ 96,571     $ 442,537  
Charge-offs   (20,314 )     -       (20,314 )
Recoveries   1,529       -       1,529  
Net charge-offs   (18,785 )     -       (18,785 )
Provision   21,000       (11,000 )     10,000  
Ending balance $ 348,181     $ 85,571     $ 433,752  
           
           
  Three Months Ended September 30, 2020
  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 $ 301,050     $ 80,571     $ 381,621  
Charge-offs   (37,284 )     -       (37,284 )
Recoveries   1,200       -       1,200  
Net charge-offs   (36,084 )     -       (36,084 )
Provision   81,000       16,000       97,000  
Ending balance $ 345,966     $ 96,571     $ 442,537  
           
           
Allowance for Credit Year Ended December 31,    
Losses Rollforward   2020       2019      
                   
  (In thousands)    
Beginning balance $ 174,646     $ 169,333      
Cumulative effect of change in          
accounting principle - CECL   7,327       -      
Charge-offs   (93,589 )     (32,262 )    
Recoveries   6,368       15,575      
Net charge-offs   (87,221 )     (16,687 )    
Provision   339,000       22,000      
Ending balance $ 433,752     $ 174,646      
           

The allowance for credit losses decreased by $8.8 million in the fourth quarter of 2020 to $433.8 million at December 31, 2020. The decrease in the allowance for credit losses during the fourth quarter was attributable to $18.8 million in net charge-offs, offset partially by a $10.0 million provision for credit losses.

Net charge-offs were $18.8 million for the fourth quarter of 2020. Gross charge-offs of $20.3 million were reduced by recoveries of $1.5 million.  The most significant charge-off was $15.5 million and related to a security monitoring loan.

Net charge-offs were $36.1 million for the third quarter of 2020. Gross charge-offs of $37.3 million were reduced by recoveries of $1.2 million.  The most significant charge-off was $32.8 million and also related to a security monitoring loan. 

Security monitoring loans have decreased 47% from $619.3 million as of December 31, 2019 to $329.3 million as of December 31, 2020 since ceasing new originations in the fourth quarter of 2019 while actively reducing the remaining loans. As of December 31, 2020, $250.6 million of these are performing and pass-rated, while $78.7 million are classified, of which $32.5 million are on nonaccrual.

For the fourth quarter of 2020 and third quarter of 2020, annualized net charge-offs to average loans and leases were 0.40% and 0.75%, respectively.

The allowance for credit losses as a percentage of loans and leases held for investment was 2.27% at December 31, 2020 and 2.33% at September 30, 2020. The allowance for loan and lease losses as a percentage of loans and leases held for investment was 1.82% at December 31, 2020 and September 30, 2020. The allowance for credit losses and allowance for loan and lease losses as a percentage of loans and leases held for investment, excluding PPP loans that are fully guaranteed and do not carry any allowance, were 2.41% and 1.93% at December 31, 2020, respectively, compared to 2.48% and 1.94% at September 30, 2020, respectively.

For the full year 2020, gross charge-offs were $93.6 million and included $63.5 million for other commercial loans, of which $59.6 million related to security monitoring loans, $11.8 million for asset-based loans, $10.2 million for commercial real estate loans, and $6.8 million for venture capital loans compared to gross charge-offs for the full year 2019 of $32.3 million that included $12.0 million for asset-based loans, of which $11.8 million related to a single loan, $9.4 million for venture capital loans, and $9.1 million for other commercial loans.

For the full year 2020, recoveries were $6.4 million and included $3.6 million for other commercial loans and $1.3 million for venture capital loans compared to recoveries for the full year 2019 of $15.6 million that included $8.2 million for venture capital loans, $4.8 million for other commercial loans, and $1.4 million for asset-based loans.

For the full year 2020, net charge-offs to average loans and leases increased to 0.45% from 0.09% for the full year 2019.

Deposits and Client Investment Funds

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

                    (Keep as 12/31)
  December 31, 2020   September 30, 2020   December 31, 2019   December 31, 2019
    % of     % of     % of     % of
Deposit Composition Balance Total   Balance Total   Balance Total   Balance Total
                                     
  (Dollars in thousands)      
Noninterest-bearing demand $ 9,193,827 37 %   $ 9,346,744   39 %   $ 7,243,298 38 %   $ 7,243,298 38 %
Interest checking   5,974,910 24 %     4,657,511   20 %     3,753,978 19 %     3,753,978 19 %
Money market   6,532,917 26 %     6,539,313   27 %     4,690,420 24 %     4,690,420 24 %
Savings   562,826 2 %     574,061   2 %     499,591 3 %     499,591 3 %
Total core deposits   22,264,480 89 %     21,117,629   88 %     16,187,287 84 %     16,187,287 84 %
Non-core non-maturity deposits   1,149,467 5 %     1,123,909   5 %     496,407 3 %     496,407 3 %
Total non-maturity deposits   23,413,947 94 %     22,241,538   93 %     16,683,694 87 %     16,683,694 87 %
Time deposits $250,000 and under   994,197 4 %     1,047,621   4 %     2,065,733 11 %     2,065,733 11 %
Time deposits over $250,000   532,573 2 %     676,536   3 %     483,609 2 %     483,609 2 %
Total time deposits   1,526,770 6 %     1,724,157   7 %     2,549,342 13 %     2,549,342 13 %
Total deposits $ 24,940,717 100 %   $ 23,965,695   100 %   $ 19,233,036 100 %   $ 19,233,036 100 %
                                         

At December 31, 2020, core deposits totaled $22.3 billion, or 89% of total deposits, including $9.2 billion of noninterest-bearing demand deposits, or 37% of total deposits. Core deposits increased by $1.1 billion in the fourth quarter driven by continued strong deposit growth from our venture banking clients. For the year ended December 31, 2020, core deposits increased by $6.1 billion and total deposits increased by $5.7 billion.

In addition to deposit products, we also offer alternative non-depository cash investment options for select clients; these alternatives include investments managed by Pacific Western Asset Management Inc. (“PWAM”), our registered investment advisor subsidiary, and third-party sweep products. Total off-balance sheet client investment funds at December 31, 2020 were $1.3 billion, of which $1.0 billion was managed by PWAM.

CREDIT QUALITY

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

           
  December 31,   September 30,   Increase
Credit Quality Metrics   2020       2020     (Decrease)
                       
  (Dollars in thousands)
NPAs and Performing TDRs:          
Nonaccrual loans and leases held for investment (1) $ 91,163     $ 85,615     $ 5,548  
Accruing loans contractually past due 90 days or more   -       -       -  
Foreclosed assets, net   14,027       13,747       280  
Total nonperforming assets ("NPAs") $ 105,190     $ 99,362     $ 5,828  
           
Performing TDRs held for investment $ 14,254     $ 13,679     $ 575  
           
Nonaccrual loans and leases held for investment          
to loans and leases held for investment   0.48 %     0.45 %    
Nonperforming assets to loans and leases          
held for investment and foreclosed assets   0.55 %     0.52 %    
           
Loan and Lease Credit Risk Ratings:          
Pass $ 18,076,832     $ 17,967,872     $ 108,960  
Special mention   741,283       783,756       (42,473 )
Classified   265,262       274,572       (9,310 )
Total loans and leases held for investment,          
net of deferred fees $ 19,083,377     $ 19,026,200     $ 57,177  
           
Classified loans and leases held for investment          
to loans and leases held for investment   1.39 %     1.44 %    
           
Allowance for Credit Losses:          
Allowance for loan and lease losses $ 348,181     $ 345,966     $ 2,215  
Reserve for unfunded loan commitments   85,571       96,571       (11,000 )
Allowance for credit losses $ 433,752     $ 442,537     $ (8,785 )
Provision for credit losses (for the quarter) $ 10,000     $ 97,000     $ (87,000 )
Net charge-offs (for the quarter) $ 18,785     $ 36,084     $ (17,299 )
Net charge-offs to average loans and leases          
(for the quarter)   0.40 %     0.75 %    
Allowance for loan and lease losses to loans          
and leases held for investment   1.82 %     1.82 %    
Allowance for credit losses to loans and leases          
held for investment   2.27 %     2.33 %    
Allowance for credit losses to nonaccrual loans          
and leases held for investment   475.8 %     516.9 %    
           
(1) Nonaccrual loans include guaranteed amounts of $13.9 million at December 31, 2020 and $13.8 million at September 30, 2020.
           

After taking pro-active and decisive steps in the first quarter at the onset of the pandemic to downgrade certain loans, the level of special mention loans and leases, which peaked in the first quarter of 2020, and classified and nonaccrual loans and leases, which peaked in the second quarter of 2020, have declined with the enhanced ongoing monitoring of the loan and lease portfolio during the course of the year. Despite the early actions, enhanced monitoring, and build in the allowance for credit losses, certain credit metrics remain elevated as we continue to manage the credit environment and economic impacts caused by the pandemic.

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:

  December 31, 2020   September 30, 2020   Increase (Decrease)
      Accruing       Accruing       Accruing
      and 30-89       and 30-89       and 30-89
      Days Past       Days Past       Days Past
  Nonaccrual   Due   Nonaccrual   Due   Nonaccrual   Due
                                       
  (Dollars in thousands)
Real estate mortgage:                      
Commercial $ 43,731   $ 3,636   $ 45,120   $ -   $ (1,389 )   $ 3,636  
Income producing and other                      
residential   1,826     600     2,008     1,761     (182 )     (1,161 )
Total real estate mortgage   45,557     4,236     47,128     1,761     (1,571 )     2,475  
Real estate construction and land:                    
Commercial   315     -     324     -     (9 )     -  
Residential   -     759     -     3,108     -       (2,349 )
Total real estate                      
construction and land   315     759     324     3,108     (9 )     (2,349 )
Commercial:                      
Asset-based   2,679     -     2,817     -     (138 )     -  
Venture capital   1,980     540     2,001     2,319     (21 )     (1,779 )
Other commercial   40,243     2,078     32,941     185     7,302       1,893  
Total commercial   44,902     2,618     37,759     2,504     7,143       114  
Consumer   389     1,260     404     791     (15 )     469  
Total held for investment $ 91,163   $ 8,873   $ 85,615   $ 8,164   $ 5,548     $ 709  
                       

During the fourth quarter of 2020, nonaccrual loans and leases increased by $5.5 million due primarily to an addition of one security monitoring loan for $26.3 million, partially offset by the sale of one security monitoring loan for $12.1 million and the paydown of another security monitoring loan for $5.8 million.

CAPITAL

The following table presents certain actual capital ratios and ratios excluding PPP loans:

  December 31, 2020    
      Excluding   September 30,
      PPP   2020
  Actual (1)    Loans (1)   Actual
PacWest Bancorp Consolidated:          
Tier 1 leverage capital ratio 8.55 %   8.93 % (3 ) 8.66 %
Common equity tier 1 capital ratio 10.53 %   10.53 %   10.45 %
Total capital ratio 13.76 %   13.76 %   13.74 %
Tangible common equity ratio (2) 8.78 %   9.12 % (3 ) 8.71 %
           
(1) Capital information for December 31, 2020 is preliminary.    
(2) Non-GAAP measure.
(3) PPP loans have been excluded from total assets in denominator as they are zero risk-weighted.
 

ABOUT PACWEST BANCORP

PacWest Bancorp (“PacWest”) is a bank holding company with over $29 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 70 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. The length of the COVID-19 pandemic and the severity of its impact on key macro-economic indicators such as unemployment and GDP may have a material impact on our allowance for credit losses and related provision for credit losses. Continued deterioration in general business and economic conditions could adversely affect PacWest Bancorp’s revenues and the values of its assets, including goodwill, 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, sustained high 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, the magnitude of individual loan losses on security monitoring loans, and legal and regulatory developments. 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        
           
  December 31,   September 30,   December 31,
    2020       2020       2019  
                       
  (Dollars in thousands, except per share data)
ASSETS:          
Cash and due from banks $ 150,464     $ 187,176     $ 172,585  
Interest-earning deposits in financial institutions   3,010,197       2,766,020       465,039  
Total cash and cash equivalents   3,160,661       2,953,196       637,624  
           
Securities available-for-sale, at estimated fair value   5,235,591       4,532,614       3,797,187  
Federal Home Loan Bank stock, at cost   17,250       17,250       40,924  
Total investment securities   5,252,841       4,549,864       3,838,111  
           
Gross loans and leases held for investment   19,153,357       19,101,680       18,910,740  
Deferred fees, net   (69,980 )     (75,480 )     (63,868 )
Total loans and leases held for investment,          
net of deferred fees   19,083,377       19,026,200       18,846,872  
Allowance for loan and lease losses   (348,181 )     (345,966 )     (138,785 )
Total loans and leases held for investment, net   18,735,196       18,680,234       18,708,087  
           
Equipment leased to others under operating leases   333,846       286,425       324,084  
Premises and equipment, net   39,234       40,544       38,585  
Foreclosed assets, net   14,027       13,747       440  
Goodwill   1,078,670       1,078,670       2,548,670  
Core deposit and customer relationship intangibles, net   23,641       26,813       38,394  
Other assets   860,326       797,223       636,811  
Total assets $ 29,498,442     $ 28,426,716     $ 26,770,806  
           
LIABILITIES:          
Noninterest-bearing deposits $ 9,193,827     $ 9,346,744     $ 7,243,298  
Interest-bearing deposits   15,746,890       14,618,951       11,989,738  
Total deposits   24,940,717       23,965,695       19,233,036  
Borrowings   5,000       60,000       1,759,008  
Subordinated debentures   465,812       463,282       458,209  
Accrued interest payable and other liabilities   491,962       451,508       365,856  
Total liabilities   25,903,491       24,940,485       21,816,109  
           
STOCKHOLDERS' EQUITY:          
Common stock   1,207       1,208       1,219  
Additional paid-in-capital   3,100,633       3,125,554       3,306,006  
Retained earnings   409,391       292,561       1,652,248  
Treasury stock   (88,803 )     (88,566 )     (83,434 )
Accumulated other comprehensive income   172,523       155,474       78,658  
STOCKHOLDERS' EQUITY (1)   3,594,951       3,486,231       4,954,697  
Total liabilities and stockholders’ equity $ 29,498,442     $ 28,426,716     $ 26,770,806  
           
Book value per share $ 30.36     $ 29.42     $ 41.36  
Tangible book value per share (2) $ 21.05     $ 20.09     $ 19.77  
Shares outstanding   118,414,853       118,489,927       119,781,605  
           
(1) Includes net unrealized gain on securities          
available-for-sale, net $ 172,523     $ 155,474     $ 78,658  
(2) Non-GAAP measure.          
           

 

PACWEST BANCORP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS (LOSS)        
                   
  Three Months Ended   Year Ended
  December 31,   September 30,   December 31,   December 31,
    2020       2020       2019       2020       2019  
                                       
  (Dollars in thousands, except per share data)
Interest income:                  
Loans and leases $ 242,198     $ 240,811     $ 263,402     $ 993,138     $ 1,097,845  
Investment securities   28,843       24,443       28,135       106,770       115,569  
Deposits in financial institutions   1,135       654       2,056       3,583       6,479  
Total interest income   272,176       265,908       293,593       1,103,491       1,219,893  
                   
Interest expense:                  
Deposits   8,454       9,887       34,802       59,663       148,460  
Borrowings   37       27       5,189       8,161       26,961  
Subordinated debentures   4,477       4,670       6,983       21,109       29,843  
Total interest expense   12,968       14,584       46,974       88,933       205,264  
                   
Net interest income   259,208       251,324       246,619       1,014,558       1,014,629  
Provision for credit losses   10,000       97,000       3,000       339,000       22,000  
Net interest income after                  
provision for credit losses   249,208       154,324       243,619       675,558       992,629  
                   
Noninterest income:                  
Service charges on deposit accounts   3,119       2,570       3,611       10,351       14,637  
Other commissions and fees   9,974       10,541       10,170       40,347       43,623  
Leased equipment income   9,440       9,900       10,648       43,628       38,727  
Gain on sale of loans and leases   1,671       35       23       2,139       1,114  
Gain on sale of securities   4       5,270       184       13,171       25,445  
Other income   15,642       9,936       2,540       36,424       19,016  
Total noninterest income   39,850       38,252       27,176       146,060       142,562  
                   
Noninterest expense:                  
Compensation   73,171       75,131       74,637       271,494       285,862  
Occupancy   14,083       14,771       14,541       57,555       57,407  
Data processing   6,718       6,505       6,770       26,779       27,556  
Other professional services   6,800       4,713       4,261       19,917       17,803  
Insurance and assessments   5,064       3,939       4,168       22,625       16,404  
Intangible asset amortization   3,172       3,751       4,153       14,753       18,726  
Leased equipment depreciation   7,501       7,057       6,856       28,865       24,016  
Foreclosed assets (income) expense, net   (272 )     335       (3,446 )     (17 )     (3,555 )
Acquisition, integration and                  
reorganization costs   1,060       -       (269 )     1,060       349  
Customer related expense   4,430       4,762       3,952       17,532       13,839  
Loan expense   3,926       3,499       2,967       13,454       12,931  
Goodwill impairment   -       -       -       1,470,000       -  
Other expense   10,029       8,939       5,138       40,002       30,913  
Total noninterest expense   135,682       133,402       123,728       1,984,019       502,251  
                   
Earnings (loss) before income taxes   153,376       59,174       147,067       (1,162,401 )     632,940  
Income tax expense   36,546       13,671       29,186       75,173       164,304  
Net earnings (loss) $ 116,830     $ 45,503     $ 117,881     $ (1,237,574 )   $ 468,636  
                   
Basic and diluted earnings (loss) per share $ 0.99     $ 0.38     $ 0.98     $ (10.61 )   $ 3.90  
Dividends declared and paid per share $ 0.25     $ 0.25     $ 0.60     $ 1.35     $ 2.40  
                   

 

PACWEST BANCORP AND SUBSIDIARIES
NET EARNINGS (LOSS) PER SHARE CALCULATIONS            
                   
  Three Months Ended   Year Ended
  December 31,   September 30,   December 31,   December 31,
    2020       2020       2019       2020       2019  
                                       
  (In thousands, except per share data)
Basic Earnings (Loss) Per Share:                  
Net earnings (loss) $ 116,830     $ 45,503     $ 117,881     $ (1,237,574 )   $ 468,636  
Less: earnings allocated to unvested                  
restricted stock (1)   (1,398 )     (578 )     (1,458 )     (1,782 )     (5,182 )
Net earnings (loss) allocated to                  
common shares $ 115,432     $ 44,925     $ 116,423     $ (1,239,356 )   $ 463,454  
                   
Weighted-average basic shares and                  
unvested restricted stock outstanding   118,446       118,438       119,804       118,463       120,468  
Less: weighted-average unvested                  
restricted stock outstanding   (1,652 )     (1,684 )     (1,566 )     (1,610 )     (1,502 )
Weighted-average basic shares                  
outstanding   116,794       116,754       118,238       116,853       118,966  
                   
Basic earnings (loss) per share $ 0.99     $ 0.38     $ 0.98     $ (10.61 )   $ 3.90  
                   
Diluted Earnings (Loss) Per Share:                  
Net earnings (loss) allocated to                  
common shares $ 115,432     $ 44,925     $ 116,423     $ (1,239,356 )   $ 463,454  
                   
Weighted-average diluted shares                  
outstanding   116,794       116,754       118,238       116,853       118,966  
                   
Diluted earnings (loss) per share $ 0.99     $ 0.38     $ 0.98     $ (10.61 )   $ 3.90  
                   
(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
  December 31, 2020   September 30, 2020   December 31, 2019
    Interest Average     Interest Average     Interest Average
  Average Income/ Yield/   Average Income/ Yield/   Average Income/ Yield/
  Balance Expense Cost   Balance Expense Cost   Balance Expense Cost
                       
  (Dollars in thousands)
Assets:                      
Loans and leases (1)(2) $ 18,769,214 $ 243,188 5.15%   $ 19,195,737 $ 241,547 5.01%   $ 18,470,583 $ 263,783 5.67%
Investment securities (3) 4,888,993 30,757 2.50%   4,107,915 26,015 2.52%   3,811,216 29,509 3.07%
Deposits in financial                      
institutions 3,576,335 1,135 0.13%   2,554,349 654 0.10%   498,068 2,056 1.64%
Total interest-earning                      
assets (1) 27,234,542 275,080 4.02%   25,858,001 268,216 4.13%   22,779,867 295,348 5.14%
Other assets 2,100,247       2,077,192       3,600,872    
Total assets $ 29,334,789       $ 27,935,193       $ 26,380,739    
                       
Liabilities and                      
Stockholders' Equity:                      
Interest checking $ 5,191,435 2,064 0.16%   $ 4,904,614 2,019 0.16%   $ 3,731,696 10,031 1.07%
Money market 7,636,220 3,225 0.17%   7,170,842 3,081 0.17%   5,117,553 12,063 0.94%
Savings 567,646 35 0.02%   565,395 35 0.02%   509,497 204 0.16%
Time 1,650,150 3,130 0.75%   1,876,072 4,752 1.01%   2,744,156 12,504 1.81%
Total interest-bearing                      
deposits 15,045,451 8,454 0.22%   14,516,923 9,887 0.27%   12,102,902 34,802 1.14%
Borrowings 237,098 37 0.06%   181,315 27 0.06%   1,179,220 5,189 1.75%
Subordinated debentures 463,951 4,477 3.84%   462,375 4,670 4.02%   456,997 6,983 6.06%
Total interest-bearing                      
liabilities 15,746,500 12,968 0.33%   15,160,613 14,584 0.38%   13,739,119 46,974 1.36%
Noninterest-bearing                      
demand deposits 9,589,789       8,812,391       7,338,888    
Other liabilities 462,075       464,320       372,550      
Total liabilities 25,798,364       24,437,324       21,450,557    
Stockholders' equity 3,536,425       3,497,869       4,930,182    
Total liabilities and                      
stockholders' equity $ 29,334,789       $ 27,935,193       $ 26,380,739    
Net interest income (1)   $ 262,112       $ 253,632       $ 248,374  
Net interest spread (1)     3.69%       3.75%       3.78%
Net interest margin (1)     3.83%       3.90%       4.33%
                       
Total deposits (4) $ 24,635,240 $ 8,454 0.14%   $ 23,329,314 $ 9,887 0.17%   $ 19,441,790 $ 34,802 0.71%
                       
(1) Tax equivalent.                      
(2) Includes discount accretion on acquired loans of $3.8 million, $2.0 million, and $3.0 million for the three months ended December 31, 2020,
   September 30, 2020, and December 31, 2019, respectively.                
(3) Includes tax-equivalent adjustments of $1.9 million, $1.6 million, and $1.4 million for the three months ended December 31, 2020,  
   September 30, 2020, and December 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                
                   
  December 31,   September 30,   June 30,   March 31,   December 31,
    2020       2020       2020       2020       2019  
                                       
  (Dollars in thousands, except per share data)
ASSETS:                  
Cash and due from banks $ 150,464     $ 187,176     $ 174,059     $ 172,570     $ 172,585  
Interest-earning deposits in financial                  
institutions   3,010,197       2,766,020       1,747,077       439,690       465,039  
Total cash and cash equivalents   3,160,661       2,953,196       1,921,136       612,260       637,624  
                   
Securities available-for-sale   5,235,591       4,532,614       3,851,141       3,757,663       3,797,187  
Federal Home Loan Bank stock   17,250       17,250       17,250       54,244       40,924  
   Total investment securities   5,252,841       4,549,864       3,868,391       3,811,907       3,838,111  
                   
Gross loans and leases held for investment   19,153,357       19,101,680       19,780,476       19,806,394       18,910,740  
Deferred fees, net   (69,980 )     (75,480 )     (85,845 )     (61,089 )     (63,868 )
Total loans and leases held for                  
investment, net of deferred fees   19,083,377       19,026,200       19,694,631       19,745,305       18,846,872  
Allowance for loan and lease losses   (348,181 )     (345,966 )     (301,050 )     (221,292 )     (138,785 )
Total loans and leases held for                  
investment, net   18,735,196       18,680,234       19,393,581       19,524,013       18,708,087  
                   
Equipment leased to others under                  
operating leases   333,846       286,425       295,191       306,530   -   324,084  
Premises and equipment, net   39,234       40,544       42,299       39,799       38,585  
Foreclosed assets, net   14,027       13,747       1,449       1,701       440  
Goodwill   1,078,670       1,078,670       1,078,670       1,078,670       2,548,670  
Core deposit and customer relationship                  
intangibles, net   23,641       26,813       30,564       34,446       38,394  
Other assets   860,326       797,223       734,457       733,941       636,811  
Total assets $ 29,498,442     $ 28,426,716     $ 27,365,738     $ 26,143,267     $ 26,770,806  
                   
LIABILITIES:                  
Noninterest-bearing deposits $ 9,193,827     $ 9,346,744     $ 8,629,543     $ 7,510,218     $ 7,243,298  
Interest-bearing deposits   15,746,890       14,618,951       14,299,036       12,065,619       11,989,738  
Total deposits   24,940,717       23,965,695       22,928,579       19,575,837       19,233,036  
Borrowings   5,000       60,000       60,000       2,295,000       1,759,008  
Subordinated debentures   465,812       463,282       460,772       458,994       458,209  
Accrued interest payable and other                  
liabilities   491,962       451,508       463,489       423,047       365,856  
Total liabilities   25,903,491       24,940,485       23,912,840       22,752,878       21,816,109  
STOCKHOLDERS' EQUITY (1)   3,594,951       3,486,231       3,452,898       3,390,389       4,954,697  
Total liabilities and stockholders’                  
equity $ 29,498,442     $ 28,426,716     $ 27,365,738     $ 26,143,267     $ 26,770,806  
                   
Book value per share $ 30.36     $ 29.42     $ 29.17     $ 28.75     $ 41.36  
Tangible book value per share (2) $ 21.05     $ 20.09     $ 19.80     $ 19.31     $ 19.77  
Shares outstanding   118,414,853       118,489,927       118,374,603       117,916,789       119,781,605  
                   
(1) Includes net unrealized gain on                  
securities available-for-sale, net $ 172,523     $ 155,474     $ 145,038     $ 90,916     $ 78,658  
(2) Non-GAAP measure.                  
                   

 

PACWEST BANCORP AND SUBSIDIARIES                
FIVE QUARTER STATEMENT OF EARNINGS (LOSS)            
                   
  Three Months Ended
  December 31,   September 30,   June 30,   March 31,   December 31,
    2020       2020       2020       2020       2019  
                                       
  (Dollars in thousands, except per share data)
Interest income:                  
Loans and leases $ 242,198     $ 240,811     $ 247,851     $ 262,278     $ 263,402  
Investment securities   28,843       24,443       26,038       27,446       28,135  
Deposits in financial institutions   1,135       654       186       1,608       2,056  
Total interest income   272,176       265,908       274,075       291,332       293,593  
                   
Interest expense:                  
Deposits   8,454       9,887       13,075       28,247       34,802  
Borrowings   37       27       1,319       6,778       5,189  
Subordinated debentures   4,477       4,670       5,402       6,560       6,983  
Total interest expense   12,968       14,584       19,796       41,585       46,974  
                   
Net interest income   259,208       251,324       254,279       249,747       246,619  
Provision for credit losses   10,000       97,000       120,000       112,000       3,000  
Net interest income after                  
provision for credit losses   249,208       154,324       134,279       137,747       243,619  
                   
Noninterest income:                  
Service charges on deposit accounts   3,119       2,570       2,004       2,658       3,611  
Other commissions and fees   9,974       10,541       10,111       9,721       10,170  
Leased equipment income   9,440       9,900       12,037       12,251       10,648  
Gain on sale of loans and leases   1,671       35       346       87       23  
Gain on sale of securities   4       5,270       7,715       182       184  
Other income   15,642       9,936       6,645       4,201       2,540  
Total noninterest income   39,850       38,252       38,858       29,100       27,176  
                   
Noninterest expense:                  
Compensation   73,171       75,131       61,910       61,282       74,637  
Occupancy   14,083       14,771       14,494       14,207       14,541  
Data processing   6,718       6,505       7,102       6,454       6,770  
Other professional services   6,800       4,713       4,146       4,258       4,261  
Insurance and assessments   5,064       3,939       9,373       4,249       4,168  
Intangible asset amortization   3,172       3,751       3,882       3,948       4,153  
Leased equipment depreciation   7,501       7,057       7,102       7,205       6,856  
Foreclosed assets (income) expense, net   (272 )     335       (146 )     66       (3,446 )
Acquisition, integration and                  
reorganization costs   1,060       -       -       -       (269 )
Customer related expense   4,430       4,762       4,408       3,932       3,952  
Loan expense   3,926       3,499       3,379       2,650       2,967  
Goodwill impairment   -       -       -       1,470,000       -  
Other expense   10,029       8,939       11,315       9,719       5,138  
Total noninterest expense   135,682       133,402       126,965       1,587,970       123,728  
                   
Earnings (loss) before income taxes   153,376       59,174       46,172       (1,421,123 )     147,067  
Income tax expense   36,546       13,671       12,968       11,988       29,186  
Net earnings (loss) $ 116,830     $ 45,503     $ 33,204     $ (1,433,111 )   $ 117,881  
                   
Basic and diluted earnings (loss) per share $ 0.99     $ 0.38     $ 0.28     $ (12.23 )   $ 0.98  
Dividends declared and paid per share $ 0.25     $ 0.25     $ 0.25     $ 0.60     $ 0.60  
                   


PACWEST BANCORP AND SUBSIDIARIES                
FIVE QUARTER SELECTED FINANCIAL DATA                
                   
  At or For the Three Months Ended
  December 31,   September 30,   June 30,   March 31,   December 31,
    2020       2020       2020       2020       2019  
                                       
  (Dollars in thousands)
Performance Ratios:                  
Return on average assets (1)   1.58 %     0.65 %     0.50 %     (21.27 )%     1.77 %
Pre-provision, pre-goodwill impairment,                
pre-tax net revenue ("PPNR")                  
return on average assets (1)(2)   2.22 %     2.22 %     2.51 %     2.39 %     2.26 %
Return on average equity (1)   13.14 %     5.18 %     3.87 %     (116.28 )%     9.49 %
Return on average tangible equity (1)(2)