Open the filing on EDGARSecond Quarter 2026 ResultsPress Release
Second Quarter 2026 Financial Highlights: INCOME STATEMENT HIGHLIGHTS Three Months EndedIncrease (Decrease)June 30, 2026March 31, 2026QoQSummary InterestAverageInterestAverageAverageAverage BalanceAverageIncome/Yield/AverageIncome/Yield/AverageYield/and Yield/Cost DataBalanceExpenseCostBalanceExpenseCostBalanceCost(Dollars in thousands)Assets:Loans and leases(1)$25,266,712$354,8325.63%$24,710,609$349,9435.74%$556,103(0.11)%Investment securities4,938,23242,4073.44%5,018,00241,8733.38%(79,770)0.06%Deposits in financial institutions1,912,58517,3573.64%1,742,65715,6263.64%169,928 - %Total interest-earning assets$32,117,529$414,5965.18%$31,471,268$407,4425.25%$646,261(0.07)%Liabilities:Noninterest-bearing demand deposits$7,866,139$7,890,489$(24,350)Total interest-bearing deposits19,752,609$124,2702.52%19,429,112$120,2332.51%323,4970.01%Total deposits$27,618,748124,2701.80%$27,319,601120,2331.78%$299,1470.02%Total interest-bearing liabilities$22,851,314$164,0952.88%$22,148,512$155,8252.85%$702,8020.03%Net interest income(1)$250,501$251,617Net interest margin3.13%3.24%(0.11)%Total funds(2)$30,717,453$164,0952.14%$30,039,001$155,8252.10%$678,4520.04% Six Months EndedIncrease (Decrease)June 30, 2026June 30, 2025YoYSummary InterestAverageInterestAverageAverageAverage BalanceAverageIncome/Yield/AverageIncome/Yield/AverageYield/and Yield/Cost DataBalanceExpenseCostBalanceExpenseCostBalanceCost(Dollars in thousands)Assets:Loans and leases(1)$24,990,197$704,7755.69%$24,148,460$708,4065.92%$841,737(0.23)%Investment securities4,977,89684,2803.41%4,726,95775,4783.22%250,9390.19%Deposits in financial institutions1,828,09032,9833.64%1,979,84343,2804.41%(151,753)(0.77)%Total interest-earning assets$31,796,183$822,0385.21%$30,855,260$827,1645.41%$940,923(0.20)%Liabilities:Noninterest-bearing demanddeposits$7,878,247$7,649,000$229,247Total interest-bearing deposits19,591,754$244,5032.52%19,464,984$285,4702.96%126,770(0.44)%Total deposits$27,470,001244,5031.79%$27,113,984285,4702.12%$356,017(0.33)%Total interest-bearing liabilities$22,501,855$319,9202.87%$21,923,564$354,5843.26%$578,291(0.39)%Net interest income(1)$502,118$472,580Net interest margin3.18%3.09%0.09%Total funds(2)$30,380,102$319,9202.12%$29,572,564$354,5842.42%$807,538(0.30)% Noninterest Income BALANCE SHEET HIGHLIGHTS Loans and Leases Credit Quality Allowance for Credit Losses - Loans Deposits and Client Investment Funds Equity Conference Call result in write-downs of asset values, restrict our ability or that of our bank subsidiary to pay dividends, or impose fines, penalties or BANC OF CALIFORNIA, INC.CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION(UNAUDITED)June 30,March 31,December 31,September 30,June 30,20262026202520252025ASSETS:(Dollars in thousands)Cash and due from banks$225,343$214,120$181,103$205,364$222,210Interest-earning deposits in financial institutions2,592,7122,003,1492,126,8622,192,9012,131,342Total cash and cash equivalents 2,818,0552,217,2692,307,9652,398,2652,353,552Securities AFS4,484,0212,656,3322,454,0582,426,7342,246,174Securities HTM - 2,313,5482,308,6362,303,6572,316,725FRB and FHLB stock181,352170,342160,442159,337162,243 Total investment securities4,665,3735,140,2224,923,1364,889,7284,725,142Loans HFS915,171259,049182,936211,454465,571Loans and leases HFI24,210,84624,780,34725,032,67924,110,64224,245,893Allowance for loan and lease losses(243,319)(241,600)(245,612)(240,501)(229,344)Total loans and leases HFI, net23,967,52724,538,74724,787,06723,870,14124,016,549Equipment leased to others under operating leases218,444223,558238,232280,872288,692Premises and equipment, net145,440146,316146,698132,766138,032Bank owned life insurance348,777352,707350,083348,051346,142Goodwill214,521214,521214,521214,521214,521Intangible assets, net92,70999,091105,287111,923118,930Deferred tax asset, net704,467653,481656,755672,159691,535Other assets940,469879,280884,762883,085891,787Total assets$35,030,953$34,724,241$34,797,442$34,012,965$34,250,453LIABILITIES:Noninterest-bearing deposits$7,758,119$7,797,542$7,822,787$7,603,748$7,441,116Interest-bearing deposits20,363,06319,524,59220,020,57019,581,01720,087,317Total deposits28,121,18227,322,13427,843,35727,184,76527,528,433Borrowings2,460,3632,551,2502,063,8192,005,0221,917,180Subordinated debt573,555954,072952,740950,888949,213Accrued interest payable and other liabilities465,707343,459396,249405,551428,784Total liabilities31,620,80731,170,91531,256,16530,546,22630,823,610STOCKHOLDERS' EQUITY: Preferred stock498,516498,516498,516498,516498,516Common stock 1,5801,5381,5001,5091,474Class B non-voting common stock 55555Non-voting common stock equivalents - - 504198Additional paid-in-capital3,485,5603,501,2133,552,4833,563,1453,609,109Retained deficit(431,305)(180,011)(242,016)(309,460)(369,142)Accumulated other comprehensive loss, net(144,210)(267,935)(269,261)(287,017)(313,217)Total stockholders’ equity3,410,1463,553,3263,541,2773,466,7393,426,843Total liabilities and stockholders’ equity$35,030,953$34,724,241$34,797,442$34,012,965$34,250,453Common shares outstanding (1)158,432,520154,262,045155,533,403155,522,693157,647,137 BANC OF CALIFORNIA, INC.CONSOLIDATED STATEMENTS OF EARNINGS(UNAUDITED)Three Months EndedSix Months EndedJune 30,March 31,June 30,June 30,20262026202520262025(In thousands, except per share amounts)Interest income:Loans and leases$354,832$349,943$362,303$704,775$708,406Investment securities42,40741,87337,61684,28075,478Deposits in financial institutions17,35715,62620,59032,98343,280Total interest income414,596407,442420,509822,038827,164Interest expense:Deposits124,270120,233144,940244,503285,470Borrowings26,56820,17720,02146,74538,442Subordinated debt13,25715,41515,33228,67230,672Total interest expense164,095155,825180,293319,920354,584Net interest income250,501251,617240,216502,118472,580Provision for credit losses161,7809,80039,100171,58048,400Net interest income after provision for credit losses88,721241,817201,116330,538424,180Noninterest income:Service charges on deposit accounts4,7634,9784,4569,7418,999Commissions and fees9,03410,9809,64120,01419,599Leased equipment income7,8208,53010,23116,35021,015(Loss) gain on loans and leases HFS(12,544)1021(12,534)232Loss on securities AFS(256,749) - - (256,749) - Dividends and gains (loss) on equity investments3,3262,002(114)5,3282,209Warrant income8969381,2271,834932Other income9,3587,8907,17117,24813,297Total noninterest (loss) income (234,096)35,32832,633(198,768)66,283Noninterest expense:Compensation 85,12091,10088,362176,220174,779Occupancy14,71414,89215,47329,60630,483Information technology and data processing13,76914,33913,07328,10828,172Other professional services5,5994,2366,4069,83510,919Insurance and assessments14,5006,7649,40321,26416,686Intangible asset amortization6,3496,3487,15912,69714,319Leased equipment depreciation5,1685,3046,70010,47213,441Customer related expense24,11423,73726,57747,85154,328Loan expense5,1704,2924,0509,4626,980Other expense15,36410,3798,66625,74319,415Total noninterest expense189,867181,391185,869371,258369,522(Loss) earnings before income taxes(335,242)95,75447,880(239,488)120,941Income tax (benefit) expense (93,895)23,80219,495(70,093)38,988Net (loss) earnings (241,347)71,95228,385(169,395)81,953Preferred stock dividends9,9479,9479,94719,89419,894Net (loss) earnings available to common and equivalent stockholders$(251,294)$62,005$18,438$(189,289)$62,059(Loss) earnings per common share:Basic$(1.61)$0.40$0.12$(1.22)$0.38Diluted$(1.61)$0.39$0.12$(1.22)$0.38Weighted average number of common shares outstanding: (1)Basic155,803154,821158,354155,315163,396Diluted155,803160,832158,462155,315163,667 BANC OF CALIFORNIA, INC.SELECTED FINANCIAL DATA(UNAUDITED)Three Months EndedSix Months EndedJune 30,March 31,June 30,June 30,Profitability and Other Ratios20262026202520262025Return on average assets (1)(2.79)%0.86%0.34%(1.00)%0.49%Return on average equity (1)(27.31)%8.22%3.32%(9.63)%4.75%Return on average tangible common equity (1)(2)(36.18)%9.91%3.70%(13.30)%5.59%Dividend payout ratio (3)(7.45)%30.00%83.33%(19.67)%52.63%Average yield on loans and leases (1)5.63%5.74%5.93%5.69%5.92%Average yield on interest-earning assets (1)5.18%5.25%5.42%5.21%5.41%Average cost of interest-bearing deposits (1)2.52%2.51%2.95%2.52%2.96%Average total cost of deposits (1)1.80%1.78%2.13%1.79%2.12%Average cost of interest-bearing liabilities (1)2.88%2.85%3.24%2.87%3.26%Average total cost of funds (1)2.14%2.10%2.42%2.12%2.42%Net interest spread 2.30%2.40%2.18%2.34%2.15%Net interest margin (1)3.13%3.24%3.10%3.18%3.09%Noninterest income to total revenue (4)(1426.98)%12.31%11.96%(65.52)%12.30%Noninterest expense to average total assets (1)2.20%2.16%2.21%2.18%2.22%Noninterest expense to total revenue (4)1157.37%63.21%68.12%122.39%68.57%Efficiency ratio (2)(5)67.18%61.00%65.50%64.02%65.92%Loans to deposits ratio89.30%91.65%89.77%89.30%89.77%Average loans and leases to average deposits91.48%90.45%89.74%90.97%89.06%Average investment securities to average total assets14.25%14.76%13.98%14.50%14.09%Average stockholders' equity to average total assets10.23%10.44%10.16%10.33%10.37% BANC OF CALIFORNIA, INC.AVERAGE BALANCE, AVERAGE YIELD EARNED, AND AVERAGE COST PAID(UNAUDITED)Three Months EndedJune 30, 2026March 31, 2026June 30, 2025InterestAverageInterestAverageInterestAverageAverage Income/Yield/Average Income/Yield/Average Income/Yield/BalanceExpenseCostBalanceExpenseCostBalanceExpenseCost(Dollars in thousands)Assets:Loans and leases (1)$25,266,712$354,8325.63%$24,710,609$349,9435.74%$24,504,319$362,3035.93%Investment securities4,938,23242,4073.44%5,018,00241,8733.38%4,719,95437,6163.20%Deposits in financial institutions1,912,58517,3573.64%1,742,65715,6263.64%1,872,73620,5904.41%Total interest-earning assets32,117,529414,5965.18%31,471,268407,4425.25%31,097,009420,5095.42%Other assets2,527,4012,531,4332,667,140Total assets$34,644,930$34,002,701$33,764,149Liabilities and Stockholders' Equity:Interest checking$8,313,16147,6942.30%$8,175,17246,8822.33%$7,778,88252,8772.73%Money market4,736,10723,4291.98%4,785,69122,8261.93%5,412,68133,6152.49%Savings1,883,2409,5752.04%1,957,8319,7722.02%1,959,98712,7772.61%Time4,820,10143,5723.63%4,510,41840,7533.66%4,569,49045,6714.01%Total interest-bearing deposits19,752,609124,2702.52%19,429,112120,2332.51%19,721,040144,9402.95%Borrowings2,399,54626,5684.44%1,765,66120,1774.63%1,628,58420,0214.93%Subordinated debt699,15913,2577.61%953,73915,4156.55%946,74015,3326.50%Total interest-bearing liabilities22,851,314164,0952.88%22,148,512155,8252.85%22,296,364180,2933.24%Noninterest-bearing demand deposits7,866,1397,890,4897,583,894Other liabilities382,336415,000453,748Total liabilities31,099,78930,454,00130,334,006Stockholders' equity3,545,1413,548,7003,430,143Total liabilities and stockholders' equity$34,644,930$34,002,701$33,764,149Net interest income (1)$250,501$251,617$240,216Net interest spread 2.30%2.40%2.18%Net interest margin3.13%3.24%3.10%Total deposits (2)$27,618,748$124,2701.80%$27,319,601$120,2331.78%$27,304,934$144,9402.13%Total funds (3)$30,717,453$164,0952.14%$30,039,001$155,8252.10%$29,880,258$180,2932.42% BANC OF CALIFORNIA, INC.AVERAGE BALANCE, AVERAGE YIELD EARNED, AND AVERAGE COST PAID(UNAUDITED)Six Months EndedJune 30, 2026June 30, 2025InterestAverageInterestAverageAverage Income/Yield/Average Income/Yield/BalanceExpenseCostBalanceExpenseCost(Dollars in thousands)Assets:Loans and leases (1)$24,990,197$704,7755.69%$24,148,460$708,4065.92%Investment securities4,977,89684,2803.41%4,726,95775,4783.22%Deposits in financial institutions1,828,09032,9833.64%1,979,84343,2804.41%Total interest-earning assets31,796,183822,0385.21%30,855,260827,1645.41%Other assets2,529,4062,682,266Total assets$34,325,589$33,537,526Liabilities and Stockholders' Equity:Interest checking$8,244,54894,5762.31%$7,562,369100,7562.69%Money market4,760,76246,2551.96%5,414,19066,6182.48%Savings1,920,32919,3472.03%1,954,34925,6342.65%Time4,666,11584,3253.64%4,534,07692,4624.11%Total interest-bearing deposits19,591,754244,5032.52%19,464,984285,4702.96%Borrowings2,084,35546,7454.52%1,513,79038,4425.12%Subordinated debt825,74628,6727.00%944,79030,6726.55%Total interest-bearing liabilities22,501,855319,9202.87%21,923,564354,5843.26%Noninterest-bearing demand deposits7,878,2477,649,000Other liabilities398,577488,060Total liabilities30,778,67930,060,624Stockholders' equity3,546,9103,476,902Total liabilities and stockholders' equity$34,325,589$33,537,526Net interest income (1)$502,118$472,580Net interest spread 2.34%2.15%Net interest margin3.18%3.09%Total deposits (2)$27,470,001$244,5031.79%$27,113,984$285,4702.12%Total funds (3)$30,380,102$319,9202.12%$29,572,564$354,5842.42% BANC OF CALIFORNIA, INC. BANC OF CALIFORNIA, INC.NON-GAAP MEASURES(UNAUDITED)Tangible Common EquityJune 30,March 31,December 31,September 30,June 30,and Tangible Book Value Per Share20262026202520252025(Dollars in thousands, except per share amounts)Stockholders' equity$3,410,146$3,553,326$3,541,277$3,466,739$3,426,843Less: Preferred stock498,516498,516498,516498,516498,516Total common equity 2,911,6303,054,8103,042,7612,968,2232,928,327Less: Goodwill and intangible assets307,230313,612319,808326,444333,451Tangible common equity$2,604,400$2,741,198$2,722,953$2,641,779$2,594,876Book value per common share (1)$18.38$19.80$19.56$19.09$18.58Tangible book value per common share (2)$16.44$17.77$17.51$16.99$16.46Common shares outstanding (3)158,432,520154,262,045155,533,403155,522,693157,647,137 BANC OF CALIFORNIA, INC.NON-GAAP MEASURES(UNAUDITED)Three Months EndedSix Months EndedJune 30,March 31,June 30,June 30,Efficiency Ratio20262026202520262025(Dollars in thousands)Noninterest expense$189,867$181,391$185,869$371,258$369,522Less: Intangible asset amortization(6,349)(6,348)(7,159)(12,697)(14,319)Noninterest expense used for efficiency ratio$183,518$175,043$178,710$358,561$355,203Net interest income $250,501$251,617$240,216$502,118$472,580Noninterest (loss) income(234,096)35,32832,633(198,768)66,283Total revenue16,405286,945272,849303,350538,863Add: Loss on securities AFS256,749 - - 256,749 - Total revenue used for efficiency ratio$273,154$286,945$272,849$560,099$538,863Noninterest expense to total revenue1157.37%63.21%68.12%122.39%68.57%Efficiency ratio (1)67.18%61.00%65.50%64.02%65.92% sanctions; (xiv) legislative or regulatory changes that adversely affect our business, including changes in tax laws and policies, accounting BANC OF CALIFORNIA, INC.NON-GAAP MEASURES(UNAUDITED)Three Months EndedSix Months EndedReturn on Average TangibleJune 30,March 31,June 30,June 30,Common Equity ("ROATCE")20262026202520262025(Dollars in thousands)Net (loss) earnings $(241,347)$71,952$28,385$(169,395)$81,953Adjustments:Intangible asset amortization6,3496,3487,15912,69714,319Tax impact of adjustment above (1)(1,778)(1,596)(1,655)(3,720)(3,311)Adjustment to net (loss) earnings4,5714,7525,5048,97711,008Adjusted net (loss) earnings for ROATCE(236,776)76,70433,889(160,418)92,961Less: Preferred stock dividends9,9479,9479,94719,89419,894Adjusted net (loss) earnings available tocommon and equivalent stockholders for ROATCE$(246,723)$66,757$23,942$(180,312)$73,067Average stockholders' equity$3,545,141$3,548,700$3,430,143$3,546,910$3,476,902Less: Average goodwill and intangible assets311,068317,215337,352314,125340,961Less: Average preferred stock498,516498,516498,516498,516498,516Average tangible common equity$2,735,557$2,732,969$2,594,275$2,734,269$2,637,425Return on average equity (2)(27.31)%8.22%3.32%(9.63)%4.75%ROATCE (3)(36.18)%9.91%3.70%(13.30)%5.59% •Executed a securities repositioning to drive higher recurring earnings power, including the sale of $2.3 billion of lower-yielding Second Quarter of 2026 Compared to First Quarter of 2026 The following table sets forth the composition, by loan category, of our loan and lease portfolio HFI as of the dates indicated: The following table sets forth the composition of our deposits at the dates indicated: During the second quarter, total stockholders’ equity decreased by $143.2 million to $3.4 billion and tangible common equity(1) decreased The Company will host a conference call to discuss its second quarter 2026 financial results at 8:00 a.m. Pacific Time (PT) on Wednesday, NON-GAAP MEASURES Three Months EndedSix Months EndedJune 30,March 31,June 30,June 30,Summary Income Statement20262026202520262025(In thousands)Total interest income$414,596$407,442$420,509$822,038$827,164Total interest expense164,095155,825180,293319,920354,584Net interest income250,501251,617240,216502,118472,580Provision for credit losses161,7809,80039,100171,58048,400(Loss) gain on loans and leases HFS(12,544)1021(12,534)232Loss on securities AFS(256,749) - - (256,749) - Other noninterest income35,19735,31832,61270,51566,051Total noninterest (loss) income(234,096)35,32832,633(198,768)66,283Total revenue16,405286,945272,849303,350538,863Total noninterest expense189,867181,391185,869371,258369,522(Loss) earnings before income taxes(335,242)95,75447,880(239,488)120,941Income tax (benefit) expense(93,895)23,80219,495(70,093)38,988Net (loss) earnings(241,347)71,95228,385(169,395)81,953Preferred stock dividends9,9479,9479,94719,89419,894Net (loss) earnings available to commonand equivalent stockholders$(251,294)$62,005$18,438$(189,289)$62,059Diluted (loss) earnings per share$(1.61)$0.39$0.12$(1.22)$0.38 June 30,March 31,June 30,Increase (Decrease)Selected Balance Sheet Items202620262025QoQYoY(In thousands)Cash and cash equivalents$2,818,055$2,217,269$2,353,552$600,786$464,503Securities available-for-sale4,484,0212,656,3322,246,1741,827,6892,237,847Securities held-to-maturity - 2,313,5482,316,725(2,313,548)(2,316,725)Loans held for sale915,171259,049465,571656,122449,600Loans and leases held for investment24,210,84624,780,34724,245,893(569,501)(35,047)Total loans and leases25,126,01725,039,39624,711,46486,621414,553Total assets35,030,95334,724,24134,250,453306,712780,500Noninterest-bearing deposits$7,758,119$7,797,542$7,441,116$(39,423)$317,003Total deposits28,121,18227,322,13427,528,433799,048592,749Borrowings2,460,3632,551,2501,917,180(90,887)543,183Total liabilities31,620,80731,170,91530,823,610449,892797,197Total stockholders' equity3,410,1463,553,3263,426,843(143,180)(16,697) June 30,March 31,December 31,September 30,June 30,Asset Quality Information and Ratios20262026202520252025(Dollars in thousands)Delinquent loans and leases held for investment:30 to 89 days delinquent$91,196$263,530$108,303$56,416$53,90090+ days delinquent82,45781,59992,655104,95295,566Total delinquent loans and leases$173,653$345,129$200,958$161,368$149,466Total delinquent loans and leases to loans and leases HFI0.72%1.39%0.80%0.67%0.62%Nonperforming assets, excluding loans held for sale:Nonaccrual loans and leases$203,712$185,734$159,168$174,541$167,51690+ days delinquent loans and still accruing - - - - - Total nonperforming loans and leases ("NPLs")203,712185,734159,168174,541167,516Foreclosed assets, net16,31918,05517,1154,7907,806Total nonperforming assets ("NPAs")$220,031$203,789$176,283$179,331$175,322Classified loans and leases HFI$582,790$842,834$800,330$763,582$656,556Special mention loans and leases HFI300,542688,659458,683505,979661,568Criticized loans and leases HFI$883,332$1,531,493$1,259,013$1,269,561$1,318,124Allowance for loan and lease losses$243,319$241,600$245,612$240,501$229,344Allowance for loan and lease losses to NPLs119.44%130.08%154.31%137.79%136.91%NPLs to loans and leases HFI0.84%0.75%0.64%0.72%0.69%NPAs to total assets0.63%0.59%0.51%0.53%0.51%Classified loans and leases to loans and leases HFI2.41%3.40%3.20%3.17%2.71%Special mention loans and leases to loans and leases HFI1.24%2.78%1.83%2.10%2.73% Three Months EndedSix Months EndedJune 30,March 31,June 30,June 30,Allowance for Credit Losses - Loans20262026202520262025(Dollars in thousands)Allowance for loan and lease losses ("ALLL"):Balance at beginning of period$241,600$245,612$234,986$245,612$239,360Charge-offs(161,617)(16,097)(46,948)(177,714)(63,499)Recoveries1,3362,2852,7263,6215,203Net charge-offs (160,281)(13,812)(44,222)(174,093)(58,296)Provision for loan losses162,0009,80038,580171,80048,280Balance at end of period$243,319$241,600$229,344$243,319$229,344Reserve for unfunded loan commitments ("RUC"):Balance at beginning of period$34,921$34,921$29,571$34,921$29,071Provision for credit losses(2,000) - (350)(2,000)150Balance at end of period$32,921$34,921$29,221$32,921$29,221Allowance for credit losses ("ACL") - Loans:Balance at beginning of period$276,521$280,533$264,557$280,533$268,431Charge-offs(161,617)(16,097)(46,948)(177,714)(63,499)Recoveries1,3362,2852,7263,6215,203Net charge-offs (160,281)(13,812)(44,222)(174,093)(58,296)Provision for credit losses160,0009,80038,230169,80048,430Balance at end of period$276,240$276,521$258,565$276,240$258,565ALLL to loans and leases HFI1.00%0.97%0.95%1.00%0.95%ACL to loans and leases HFI1.14%1.12%1.07%1.14%1.07%ACL to NPLs135.60%148.88%154.35%135.60%154.35%ACL to NPAs125.55%135.69%147.48%125.55%147.48%Annualized net charge-offs to average loans and leases2.54%0.23%0.72%1.40%0.49% policies and practices, privacy laws, and regulatory capital or other rules; (xv) the risk that our enterprise risk management framework may securities and partial redeployment of $1.7 billion into higher-yielding shorter-duration securities, with the remaining proceeds by $136.8 million to $2.6 billion at June 30, 2026. The decrease in total stockholders’ equity for the second quarter resulted primarily from July 29, 2026. Interested parties are welcome to attend the conference call by dialing (888) 317-6003 and referencing event code 9364475. Noninterest income decreased by $269.4 million, resulting in a loss of $234.1 million for the second quarter, compared to noninterest not be effective in mitigating risk and reducing the potential for losses; (xvi) errors in estimates of the fair values of certain of our assets June 30,March 31,December 31,September 30,June 30,20262026202520252025(Dollars in thousands)Composition of Loans and LeasesReal estate mortgage:Commercial$4,037,229$4,093,386$4,314,637$4,292,625$4,369,401Multi-family5,445,4755,955,1026,089,4176,124,6736,280,791Other residential3,793,8763,458,4103,346,7333,162,5643,157,616Total real estate mortgage13,276,58013,506,89813,750,78713,579,86213,807,808Real estate construction and land:Commercial360,392364,575379,387395,150381,449Residential1,114,4591,527,7541,568,2401,759,6761,920,642Total real estate construction and land1,474,8511,892,3291,947,6272,154,8262,302,091Total real estate14,751,43115,399,22715,698,41415,734,68816,109,899Commercial:Asset-based3,318,8223,209,3382,951,0102,742,5192,462,351Venture capital2,440,0752,322,2612,222,0971,907,6012,002,601Other commercial3,353,5343,501,3883,804,0993,356,5373,288,305Total commercial9,112,4319,032,9878,977,2068,006,6577,753,257Consumer346,984348,133357,059369,297382,737Total loans and leases HFI$24,210,846$24,780,347$25,032,679$24,110,642$24,245,893Total unfunded loan commitments$5,211,632$5,549,325$5,433,357$4,822,917$4,673,596Composition as % of Total Loans and LeasesReal estate mortgage:Commercial17%17%17%18%18%Multi-family22%24%24%25%26%Other residential16%14%14%13%13%Total real estate mortgage55%55%55%56%57%Real estate construction and land:Commercial1%2%2%2%1%Residential5%6%6%7%8%Total real estate construction and land6%8%8%9%9%Total real estate61%63%63%65%66%Commercial:Asset-based14%13%12%11%10%Venture capital10%9%9%8%8%Other commercial14%14%15%14%14%Total commercial38%36%36%33%32%Consumer1%1%1%2%2%Total loans and leases HFI100%100%100%100%100% June 30,March 31,December 31,September 30,June 30,20262026202520252025(Dollars in thousands)Composition of DepositsNoninterest-bearing checking$7,758,119$7,797,542$7,822,787$7,603,748$7,441,116Interest-bearing:Checking8,739,3688,178,4858,509,5877,930,9517,974,452Money market5,136,5614,643,3494,917,8574,974,1775,375,080Savings1,834,5171,991,0101,905,8631,949,3691,932,906Time deposits:Non-brokered 2,061,3232,149,5642,254,2932,468,0172,492,890Brokered 2,591,2942,562,1842,432,9702,258,5032,311,989Total time deposits4,652,6174,711,7484,687,2634,726,5204,804,879Total interest-bearing20,363,06319,524,59220,020,57019,581,01720,087,317Total deposits$28,121,182$27,322,134$27,843,357$27,184,765$27,528,433Composition as % of Total DepositsNoninterest-bearing checking28%29%28%28%27%Interest-bearing:Checking31%30%30%29%29%Money market18%17%18%19%20%Savings7%7%7%7%7%Time deposits:Non-brokered7%8%8%9%9%Brokered9%9%9%8%8%Total time deposits16%17%17%17%17%Total interest-bearing72%71%72%72%73%Total deposits100%100%100%100%100% We refer to certain financial measures that are not recognized under U.S. generally accepted accounting principles (“GAAP”) in this press expected to be invested in the third quarter of 2026. The repositioning generated a 276 basis point yield pickup on redeployed balances net losses of $241.3 million and common and preferred stock dividends of $29.3 million, offset partially by a decrease in the unrealized A live audio webcast will also be available, and the webcast link will be posted on the Company’s Investor Relations website at income of $35.3 million for the first quarter. The decrease was primarily driven by a $256.7 million pre-tax loss recognized as part of the and liabilities, as well as the value of collateral supporting our loans, which may result in significant changes in valuation or recoveries; release, including: tangible common equity, tangible book value per common share, return on average tangible common equity, pre-tax and resulted in a $256.7 million pre-tax loss on securities. after-tax net loss in AOCI for AFS and HTM securities of $125.3 million. www.bancofcal.com/investor. The slide presentation for the call will also be available on the Company's Investor Relations website prior Banc of California, Inc. Reports Second Quarter 2026 Financial Results and Announces Strategic Balance Sheet securities repositioning, and a $12.5 million loss recorded as part of the lower of cost or market adjustment on HFS loans. Also included in (xvii) cybersecurity threats and failures or security breaches with respect to the network, applications, vendors and computer systems on pre-provision income, efficiency ratio, and economic coverage ratio. These non-GAAP measures are used by management in its analysis of Repositioning to Enhance Long-Term Earnings to the call. A replay of the call will be made available approximately one hour after the call has ended on the Company’s Investor Relations
- Commenced a targeted loan sale process involving $827.0 million of loans to reduce selected exposures, enhance capital efficiency, noninterest income was a $3.1 million loss related to the redemption of $385.0 million aggregate principal amount of subordinated notes At June 30, 2026, book value per common share decreased to $18.38 compared to $19.80 at March 31, 2026, and tangible book value per which we depend; (xviii) our ability to attract and retain key members of our senior management team; (xix) the effects of climate change, the Company's performance. website at www.bancofcal.com/investor or by dialing (855) 669-9658 and referencing event code 7085829. and improve the risk profile of the loan portfolio. Total provision expense of $161.8 million includes the impact of transferring these during the quarter. The loss was offset partially by a $3.8 million gain recognized on the sale of the Company's single-family mortgage common share(1) decreased to $16.44 compared to $17.77 at March 31, 2026. The decrease primarily reflected the repositioning actions severe weather events, natural disasters such as earthquakes and wildfires, pandemics, epidemics and other public health crises, military Company Release - 7/29/2026 Tangible common equity is calculated by subtracting preferred stock, as applicable, from total common equity. Return on average tangible loans to held for sale at the lower of cost or market value. servicing rights portfolio, which serviced approximately $1.35 billion of underlying loans. completed during the quarter. activity (including the ongoing Iran war) or acts of terrorism, and other external events on our business; (xx) the impact of bank failures or Quarter Results9% Loan Average Annualized Growth12%Deposit Annualized Growth$2.3 billion Securities Repositioning$18.38Book Value Per Share$16.44Tangible Book Value Per Share(1)$(1.61)Loss Per Share common equity is calculated by dividing net earnings available to common stockholders, after adjustment for amortization of intangible About Banc of California, Inc. other adverse developments at other banks on general depositor and investor sentiment regarding the stability and liquidity of banks; (xxi)
- Retired $385.0 million of subordinated debt prior to a significantly higher interest rate reset, reducing future funding costs and YTD June 30, 2026 vs YTD June 30, 2025 For the six-month period ended June 30, 2026, the Company repurchased 1,709,935 shares of common and common equivalent stock at a assets and any goodwill impairment, by average tangible common equity. Banking regulators also exclude goodwill and other intangible the possibility that our recorded goodwill could become impaired, which may have an adverse impact on our earnings and capital; (xxii) Banc of California, Inc. (NYSE: BANC) is a bank holding company with over $34 billion in assets and the parent company of Banc of weighted average price per share of $18.68, or $31.9 million in the aggregate. As of June 30, 2026, $82.6 million remained available under supporting stronger pre-tax pre-provision earnings. assets from stockholders' equity when assessing the capital adequacy of a financial institution. Noninterest income decreased by $265.1 million to a loss of $198.8 million for the six months ended June 30, 2026, compared to income our existing indebtedness, together with any future incurrence of additional indebtedness, could adversely affect our ability to raise California. Banc of California is one of the nation’s premier relationship-based business banks, providing banking and treasury the current stock repurchase authorization, which expires in March 2027.
- Average loans increased $556.1 million, or 2.3%, during the quarter, driven by $2.8 billion of loan production and of $66.3 million for the same period 2025. The year-to-date decrease was primarily attributable to the $256.7 million pre-tax loss additional capital and to meet our debt obligations; (xxiii) changes in market conditions or strategic balance sheet actions, which may result Pre-tax pre-provision income is calculated by subtracting noninterest expense from total revenue, which is the sum of net interest income management services to small, middle-market, and venture-backed businesses. Banc of California is the largest independent bank (1) Non-GAAP measure; refer to section 'Non-GAAP Measures' disbursements with a weighted average interest rate on production of 6.39%. recognized as part of the securities repositioning, and a $12.5 million lower of cost or market adjustment on the HFS loans, as discussed in realized losses on investment securities or other assets; (xxiv) the effects of any damage to our reputation resulting from developments and noninterest income. headquartered in Los Angeles and the third largest bank headquartered in California and offers a broad range of loan and deposit products above. related to any of the items identified above; and (xxv) other economic, competitive, governmental, regulatory, and technological factors and services through 77 full-service branches located throughout California and in Denver, Colorado, and Durham, North Carolina, as well
- Total deposits increased $799.0 million, or 2.9% during the quarter, with average noninterest-bearing deposits comprising
Efficiency ratio is calculated by dividing noninterest expense (less intangible asset amortization and acquisition, integration and affecting our operations, pricing, products and services and the other risks described in our Annual Report on Form 10-K for the fiscal year CAPITAL AND LIQUIDITY as through regional offices nationwide. The bank also provides full-service payment processing solutions to its clients and serves the 28.5% of average total deposits. reorganization costs) by total revenue (the sum of net interest income and noninterest income, less gain (loss) on securities AFS). Noninterest Expense ended December 31, 2025 and from time to time in other documents that we file with or furnish to the SEC. Community Association Management industry nationwide with its technology-forward platform, SmartStreet™. The bank is committed to The following table sets forth our regulatory capital ratios as of the dates indicated:
- Loan-to-deposit ratio decreased 235 basis points to 89.3%.
Economic coverage ratio is calculated by dividing the allowance for credit losses adjusted for the impact of the credit-linked notes and its local communities through the Banc of California Charitable Foundation, and by supporting organizations that provide financial literacy ______________ Second Quarter of 2026 Compared to First Quarter of 2026 LOS ANGELES, Calif.--(BUSINESS WIRE)--Banc of California, Inc. (NYSE: BANC) (“Banc of California” or the “Company”), the June 30,March 31,December 31,September 30,June 30,20262026202520252025Capital Ratios(1)Banc of California, Inc.Total risk-based capital ratio14.31%16.55%16.31%16.69%16.37%Tier 1 risk-based capital ratio11.67%12.54%12.34%12.56%12.34%Common equity tier 1 capital ratio9.25%10.18%10.01%10.14%9.95%Tier 1 leverage ratio8.89%9.97%9.99%9.77%9.74%Banc of CaliforniaTotal risk-based capital ratio13.74%15.97%15.61%15.94%15.65%Tier 1 risk-based capital ratio12.68%13.50%13.15%13.42%13.21%Common equity tier 1 capital ratio12.68%13.50%13.15%13.42%13.21%Tier 1 leverage ratio9.64%10.73%10.65%10.44%10.42% unearned credit mark from purchase accounting by loans and leases HFI. and job training, small business support, affordable housing, and more. Member FDIC. For more information, please visit us Non-GAAP Financial Measures •Credit quality trends were favorable, as classified loans and leases and special mention loans and leases as a percentage of total (1) Total common equity divided by common shares outstanding. Securities Noninterest expense increased by $8.5 million to $189.9 million for the second quarter from $181.4 million for the first quarter, primarily parent company of wholly-owned subsidiary Banc of California (the “Bank”), today reported financial results for the second quarter ended at www.bancofcal.com. loans and leases held for investment declined by 99 basis points, and 154 basis points, respectively. ______________ (2) Tangible common equity divided by common shares outstanding. Management believes the presentation of these financial measures adjusting the impact of these items provides useful supplemental Included in this press release are certain non-GAAP financial measures, such as tangible common equity, tangible book value per common reflecting a $7.7 million increase in insurance and assessment due to a higher FDIC assessment rate resulting from the balance sheet June 30, 2026. As part of the securities repositioning, the Company reclassified its entire held-to-maturity ("HTM") securities portfolio with an aggregate (3) Common shares outstanding include non-voting common stock equivalents that are participating securities. There were no non‑voting common stock equivalents information that is essential to a proper understanding of the financial results and operating performance of the Company. This disclosure share, return on average tangible common equity, pre-tax pre-provision income, efficiency ratio, and economic coverage ratio, designed to (1) Noninterest expense used for efficiency ratio divided by total revenue used for efficiency ratio. •Capital ratios(1) exceeded the regulatory thresholds for "well capitalized" banks, including an estimated 11.67% Tier 1 capital repositioning and its effect on assessment-related metrics and a $5.0 million increase in other expense related mainly to software amortized cost basis of $2.3 billion to available-for-sale ("AFS") securities and subsequently sold primarily all of the securities. The $2.3 outstanding as of June 30, 2026 and March 31, 2026. Forward-Looking Statements During the second quarter, the Company completed a strategic reallocation of capital toward higher return opportunities to further should not be viewed as a substitute for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP complement the financial information presented in accordance with U.S. GAAP because management believes such measures are useful to ratio and 9.25% CET 1 capital ratio. The CET 1 ratio is expected to increase to approximately 9.45-9.50% upon closing of the targeted obsolescence charges. These increases were offset partially by a $6.0 million decrease in compensation expense due to seasonal payroll billion of securities sold had an average yield of approximately 2.1% and were sold at a pre-tax loss of $251.3 million. The transaction strengthen long-term earnings, expand net interest margin, and increase balance sheet flexibility. The Company took three specific actions performance measures that may be presented by other companies. investors. These non-GAAP financial measures should be considered only as supplemental to, and not superior to, financial measures loan sale and to approximately 9.50-9.60% at the end of the third quarter. related costs recognized in the first quarter. This press release includes forward-looking statements within the meaning of the “Safe-Harbor” provisions of the Private Securities ______________ improved the Company's earning-asset mix by facilitating the redeployment of proceeds into higher-yielding assets while enhancing including (i) the repositioning of $2.3 billion of lower-yielding securities, (ii) initiating the sale of $827.0 million of selected commercial provided in accordance with GAAP. Please refer to the “Non-GAAP Measures” section of this release for additional detail including June 30,March 31,June 30,Economic Coverage Ratio202620262025(Dollars in thousands)Allowance for credit losses ("ACL")$276,240$276,521$258,565Add: Unearned credit mark from purchase accounting (1)12,92014,31519,199Add: Credit-linked notes (2)105,026104,988112,887Adjusted allowance for credit losses$394,186$395,824$390,651Loans and leases HFI$24,210,846$24,780,347$24,245,893ACL to loans and leases HFI (3)1.14%1.12%1.07%Economic coverage ratio (4)1.63%1.60%1.61% Litigation Reform Act of 1995. These statements include, but are not limited to, statements related to our expectations regarding the The following tables provide reconciliations of the non-GAAP measures to financial measures defined by GAAP. ______________ balance sheet flexibility. As of June 30, 2026 we reinvested $1.7 billion at a weighted average yield of 4.87%, which resulted in a 276 •Book value per share and tangible book value per share(2) were $18.38 and $16.44, respectively, reflecting the near-term impact of YTD June 30, 2026 vs YTD June 30, 2025 (1) Includes net loan discount accretion of $11.2 million and $12.2 million for the three months ended June 30, 2026 and March 31, 2026, respectively. real estate and multi-family construction loans, and (iii) the retirement of $385.0 million of subordinated debt prior to higher contractual reconciliations of the non-GAAP financial measures included in this press release to the most directly comparable financial measures Net Interest Income and Margin performance of our business, liquidity and capital ratios; the anticipated benefits of our strategic repositioning including, among others, a basis point yield pickup on redeployed balances. the strategic balance sheet repositioning actions completed during the quarter. (1) Includes net loan discount accretion of $23.4 million and $32.1 million for the six months ended June 30, 2026 and 2025. (2) Total funds is the sum of total interest-bearing liabilities and noninterest-bearing demand deposits. The cost of total funds is calculated as annualized total interest expense interest reset. prepared in accordance with GAAP. Noninterest expense increased by $1.7 million to $371.3 million for the six months ended June 30, 2026 from $369.5 million for the six strengthened credit profile, possible net interest income and net interest margin expansion and an enhanced earnings profile; and other nondivided by average total funds. Second Quarter of 2026 Compared to First Quarter of 2026 ______________ (2) Total funds is the sum of total interest-bearing liabilities and noninterest-bearing demand deposits. The cost of total funds is calculated as annualized total interest expense AFS securities increased by $1.8 billion during the second quarter to $4.5 billion at June 30, 2026 compared to $2.7 billion at March 31, months ended June 30, 2025. The increase is primarily due to a $6.3 million increase in other expense related mainly to software historical statements. Words or phrases such as “believe,” “will,” “should,” “will likely result,” “are expected to,” “will continue,” “is The Company transferred $2.3 billion of lower-yielding held-to-maturity securities to available-for-sale, and subsequently sold and (1) Capital ratios for June 30, 2026 are preliminary divided by average total funds. (1) Annualized. 2026, due primarily to the transfer of HTM securities to AFS of $2.3 billion and purchases of $1.9 billion, offset partially by the sale of ______________ obsolescence charges, a $4.6 million increase in insurance and assessment due to the higher assessment rate resulting from the balance Net interest income decreased by $1.1 million to $250.5 million for the second quarter, from $251.6 million in the first quarter. This (2) Non-GAAP measure; refer to section 'Non-GAAP Measures' anticipated,” “estimate,” “project,” “plans,” “strategy,” or similar expressions are intended to identify these forward-looking statements. redeployed a portion of the proceeds into higher-yielding, shorter-duration available-for-sale securities. The securities repositioning (2) Non-GAAP measure. Investor Relations Inquiries:Banc of California, Inc.(855) 361-2262Jared Wolff, (310) 424-1230Joe Kauder, (310) 844-5224Ann DeVries, (646) 376-7011Media Contact:Debora Vrana, Banc of California(213) 533-3122Deb.Vrana@bancofcal.com $2.3 billion, as part of the securities repositioning, $116.9 million of principal paydowns, $16.7 million of maturities, $8.2 million decrease sheet repositioning, and a $2.5 million increase in loans expense related to legal fees. These increases were offset partially by a $6.5 decrease was driven by an $8.3 million increase in total interest expense, offset partially by a $7.2 million increase in total interest income. You are cautioned not to place undue reliance on any forward-looking statements. These statements are necessarily subject to risk and (1) Effective tax rates of 28.00%, 25.14%, and 23.12% used for the three months ended June 30, 2026, March 31, 2026, and June 30, 2025, respectively. Effective tax rates of generated a 276 basis point yield pickup on redeployed balances, reduced portfolio duration, and improved the risk-weighted asset profile YTD June 30, 2026 vs YTD June 30, 2025 (3) Ratio calculated by dividing dividends declared per common and equivalent share by basic (loss) earnings per common and equivalent share. in the fair value of AFS securities, and $2.0 million of net amortization. As of June 30, 2026, AFS securities had aggregate unrealized net million decrease in customer related expenses primarily due to federal fund rate cuts in the fourth quarter of 2025 and a $3.0 million 29.30% and 23.12% used for the six months ended June 30, 2026 and 2025. The increase in interest expense was due to a $4.0 million increase in interest expense on deposits, attributable to higher average balances, Credit quality metrics improved from the first quarter, primarily reflecting the transfer of certain loans to HFS as part of the balance sheet uncertainty and actual results could differ materially from those anticipated due to various factors, including those set forth from time to of the securities portfolio, all while maintaining capital ratios significantly above “well capitalized” regulatory thresholds. Provision For Credit Losses Net interest income increased $29.5 million to $502.1 million for the six months ended June 30, 2026, from $472.6 million for the six (4) Total revenue equals the sum of net interest income and noninterest income. after-tax losses in AOCI of $145.3 million, up from $143.3 million at March 31, 2026, driven by higher interest rates. decrease in leased equipment depreciation. repositioning. Nonperforming, classified, and special mention loans and leases as a percentage of total loans held for investment increased and a $4.2 million increase in interest expense on our borrowings driven by higher average balances to fund loan growth and replace (2) Annualized net (loss) earnings divided by average stockholders' equity. time in the documents filed or furnished by the Company with the Securities and Exchange Commission ("SEC"). The Company The Company also commenced a targeted sale process of $827.0 million of commercial real estate and multi-family construction loans to months ended June 30, 2025. The increase was primarily driven by a $41.0 million decrease in interest expense on deposits primarily due Second Quarter of 2026 Compared to First Quarter of 2026 (5) Ratio calculated by dividing noninterest expense (less intangible asset amortization and acquisition, integration and reorganization costs) by total revenue (the sum of net 9 basis points, and decreased 99 basis points and 154 basis points, respectively. subordinated debt funding, following the redemption of the 3.25% Fixed-to-Floating Rate Subordinated Notes due 2031 during the second (3) Annualized adjusted net (loss) earnings available to common and equivalent stockholders for ROATCE divided by average tangible common equity. undertakes no obligation to revise or publicly release any revision or update to these forward-looking statements to reflect events or As of June 30, 2026, there are no HTM securities. ______________ interest income and noninterest income, less gain (loss) on securities AFS) . reduce selected credit exposures and lower the potential for future credit-related earnings volatility. Following a competitive loan sale to lower interest rates following federal funds rate cuts, and an $8.8 million increase in interest income from investment securities Income Taxes quarter. The increase in interest income was driven by a $10.4 million increase from higher average loan balances and an additional day in circumstances that occur after the date on which such statements were made, except as required by law. The allowance for credit losses - loans, which includes the reserve for unfunded loan commitments, totaled $276.2 million, or 1.14% of The provision for credit losses was $161.8 million for the second quarter compared to $9.8 million for the first quarter. The increase was At June 30, 2026, total delinquent loans and leases were $173.7 million, compared to $345.1 million at March 31, 2026. The 30 to 89 days Total deposits increased by $799.0 million to $28.1 billion at June 30, 2026 from $27.3 billion at March 31, 2026, driven by an increase in process, the Company has entered into purchase and sale agreements for the loans transferred to held-for-sale during the quarter and reflecting the benefits of prior balance sheet repositioning actions and reinvestment into higher-yielding assets. These benefits were offset (1) June 30, 2026 capital ratios are preliminary. the quarter, and a $2.3 million increase from investments and deposits in financial institutions driven by higher average balances as a result Three Months EndedSix Months EndedJune 30,March 31,June 30,June 30,Pre-Tax Pre-Provision (Loss) Income20262026202520262025(Dollars in thousands)Net interest income (GAAP)$250,501$251,617$240,216$502,118$472,580Add: Noninterest (loss) income (GAAP)(234,096)35,32832,633(198,768)66,283Total revenues (GAAP)16,405286,945272,849303,350538,863Less: Noninterest expense (GAAP)189,867181,391185,869371,258369,522Pre-tax pre-provision (loss) income (Non-GAAP)$(173,462)$105,554$86,980$(67,908)$169,341 total loans and leases at June 30, 2026, compared to $276.5 million, or 1.12% of total loans and leases at March 31, 2026. The $0.3 million primarily driven by $161.6 million of charge-offs, the impact of loan growth and higher loss given default rates on commercial real estate delinquent category decreased by $140.7 million in residential real estate construction and land loans, $32.9 million in commercial real Second Quarter of 2026 Compared to First Quarter of 2026 interest-bearing deposits of $838.5 million and a decrease in noninterest-bearing deposits of $39.4 million. Interest-bearing deposits Factors that could cause actual results to differ materially from the results anticipated or projected include, but are not limited to: (i) expects the transactions to close in the third quarter. In addition, the Company retired $385.0 million of subordinated debt prior to a partially by a $10.3 million decrease in interest income from deposits in financial institutions due to lower balances and lower market of the securities repositioning. These increases were offset partially by a $4.6 million reduction primarily related to loans placed on ______________ ______________ decrease in the allowance was driven by net charge-offs of $160.3 million, largely associated with loans transferred to HFS during the and multi-family construction loans, offset partially by improved risk ratings for our held for investment ("HFI") portfolio. The increase in estate construction and land loans, and $32.8 million in multi-family real estate mortgage loans, offset partially by increases of $27.9 increased due mainly to higher balances in checking accounts of $560.9 million and higher money market accounts of $493.2 million, changes in general economic conditions, either nationally or in our market areas, including the impact of tariffs and retaliatory tariffs, significantly higher interest rate reset. Taken together, these actions are expected to immediately improve net interest margin, support interest rates, a $6.3 million increase in borrowing costs associated with funding loan growth and the subordinated debt redemption in the Income tax benefit of $93.9 million was recorded for the second quarter, resulting in an effective tax rate of 28.0%, compared to income nonaccrual status. quarter, offset partially by the provision of $160.0 million. At June 30, 2026, cash and cash equivalents totaled $2.8 billion, up $600.8 million from March 31, 2026. (1) Includes net loan discount accretion of $11.2 million, $12.2 million, and $16.1 million for the three months ended June 30, 2026, March 31, 2026, and June 30, 2025. (1) Includes net loan discount accretion of $23.4 million and $32.1 million for the six months ended June 30, 2026 and 2025. net charge-offs in the quarter related primarily to the transfer of $827.0 million of loans to held for sale ("HFS") in connection with the million in other residential real estate mortgage loans. In the 90 or more days delinquent category, there were increases of $11.8 million in offset partially by lower savings accounts of $156.5 million and lower brokered and non-brokered time deposits of $59.1 million. supply chain disruptions, and the risk of recession or an economic downturn; (ii) changes in the interest rate environment, including the ______________ higher recurring earnings, and accelerate organic capital generation. second quarter of 2026, and a $3.6 million decrease in loan interest income primarily attributable to a reversal of previously accrued tax expense of $23.8 million and an effective tax rate of 24.9% for the first quarter. The second quarter tax rate reflects the effects of the targeted loan sale process. The transfer required the loans to be recorded at lower of cost or market value, resulting in charge-offs and other commercial loans and $9.1 million in multi-family real estate mortgage loans, offset partially by decreases of $23.2 million in (2) 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 (2) 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 Net interest margin was 3.13% for the second quarter, down 11 basis points from 3.24% for the first quarter. Upon closing of the targeted recent and potential future changes in the FRB benchmark rate, which could adversely affect our revenue and expenses, the value of assets Our ability to absorb credit losses is also bolstered by (i) $105.0 million of loss coverage from the credit-linked notes, pursuant to which Our immediately available cash and cash equivalents (excluding restricted cash) were $2.6 billion. Combined with total available interest on loans placed on nonaccrual status, offset partially by the benefit of higher average loan balances. (1) Unearned credit mark from purchase accounting estimated by using the same pro rata split between the credit and yield marks associated with non-PCD loans (purchased Company's balance sheet repositioning actions. Due to the significant impact of these actions on projected annual earnings, the Company At June 30, 2026, noninterest-bearing checking deposits totaled $7.8 billion, or 28% of total deposits, compared to $7.8 billion, or 29% of on total deposits divided by average total deposits. on total deposits divided by average total deposits. The Company reported a net loss available to common and equivalent stockholders of $251.3 million, or $(1.61) per diluted common additional provision expense during the quarter. commercial real estate loans. loan sale, net interest margin is expected to increase to approximately 3.30%. The decrease was primarily driven by nonaccrual interest and obligations, the realization of deferred tax assets, the availability and cost of capital and liquidity, and the impacts of continuing or the bank sold the first 5% of any losses on $2.1 billion of single-family residential mortgage loans in our portfolio; and (ii) unearned credit borrowing capacity of $7.9 billion and unpledged AFS securities of $3.6 billion, total available liquidity was $14.1 billion at the end of the loans without credit deterioration at the time of purchase). calculated its second quarter income tax provision using a year to date effective tax rate approach rather than the estimated annual effective total deposits, at March 31, 2026. (3) Total funds is the sum of total interest-bearing liabilities and noninterest-bearing demand deposits. The cost of total funds is calculated as annualized total interest expense (3) Total funds is the sum of total interest-bearing liabilities and noninterest-bearing demand deposits. The cost of total funds is calculated as annualized total interest expense share, reflecting the near-term impact of these strategic actions. The net interest margin was 3.18% for the six months ended June 30, 2026, up 9 basis points from 3.09% for the six months ended June impacts and an increase in short-term funding associated with strong loan growth and the redemption of subordinated debt, while core renewed inflation; (iii) the credit risks of lending activities, which may be affected by deterioration in real estate markets and the financial marks of $12.9 million on approximately $1.2 billion of purchased loans without credit deterioration. When the loss coverage from the second quarter. (2) Credit-linked notes loss coverage equal to 5% of the unpaid principal balance of the pledged loans. The first quarter provision for loan losses and unfunded loan commitments was primarily driven by net charge off activity and changes in At June 30, 2026, nonperforming loans and leases were $203.7 million, compared to $185.7 million at March 31, 2026. During the second tax rate method. divided by average total funds. divided by average total funds. 30, 2025. The year-over-year improvement was primarily driven by a 30 basis point decrease in the average total cost of funds to 2.12%, deposit growth strengthened toward quarter-end, improving the Company's funding profile entering the third quarter. The average total At June 30, 2026, uninsured and uncollateralized deposits totaled $7.6 billion, or 27% of total deposits, compared to $7.8 billion, or 28% condition of borrowers, and the operational risk of lending activities, including the effectiveness of our underwriting practices and the risk credit-linked notes and unearned credit marks is added to our allowance for credit losses, this provides additional economic coverage on Jared Wolff, Chairman & CEO of Banc of California, commented, “During the second quarter, we made a strategic decision to reallocate loan risk ratings including specific reserves, offset partially by lower balances in the HFI portfolio and lower qualitative reserves. quarter, nonperforming loans and leases increased by $18.0 million due to additions of $391.7 million, offset partially by transfers to loans (3) Allowance for credit losses divided by loans and leases HFI. offset partially by a 20 basis point decrease in the average yield on interest-earning assets to 5.21%. YTD June 30, 2026 vs YTD June 30, 2025 cost of funds increased to 2.14% from 2.10%, as a result of a 2 basis point increase in the average total cost of deposits to 1.80%, and a 19 of total deposits, at March 31, 2026. of fraud, any of which may lead to increased loan delinquencies, losses, and non-performing assets, and may result in our allowance for top of our ACL ratio. We refer to this adjusted ACL ratio as our economic coverage ratio(1), which equaled 1.63% of total loans and leases capital toward opportunities that we believe will enhance long-term returns for our shareholders. We implemented that strategy through HFS of $248.0 million, charge-offs of $91.8 million, paydowns of $32.4 million, and transfers to accrual status of $1.5 million. (4) Adjusted allowance for credit losses divided by loans and leases HFI. YTD June 30, 2026 vs YTD June 30, 2025 basis point decrease in the average cost of borrowings to 4.44%. The average yield on interest-earning assets decreased to 5.18% from credit losses not being adequate; (iv) fluctuations in the demand for loans, and fluctuations in commercial and residential real estate values at June 30, 2026 compared to 1.60% at March 31, 2026. three complementary actions including a securities repositioning, a targeted loan sale and the retirement of higher-cost subordinated debt, The average total cost of funds decreased by 30 basis points to 2.12%, driven mainly by lower market interest rates. The average cost of Income tax benefit of $70.1 million was recorded for the six months ended June 30, 2026, resulting in an effective tax rate of 29.3%, In addition to deposit products, we also offer alternative, non-depository corporate treasury solutions for select clients to invest excess At June 30, 2026, nonperforming assets were $220.0 million, or 0.63% of total assets, compared to $203.8 million, or 0.59% of total assets, 5.25%, as a result of a 11 basis point decrease in the average yield on loans and leases to 5.63%. in our market area; (v) the quality and composition of our securities portfolio; (vi) our ability to develop and maintain a strong core deposit The provision for credit losses was $171.6 million for the six months ended June 30, 2026, compared to $48.4 million for the six months that together create a more efficient balance sheet and position the Company for even stronger long-term financial performance." deposits declined by 33 basis points to 1.79%, reflecting the impact of federal funds rate cuts in the second half of 2025. Average total compared to income tax expense of $39.0 million and effective tax rate of 32.2% for the same period 2025. The decrease in effective tax liquidity. These off-balance sheet client funds totaled $1.0 billion as of June 30, 2026 and $1.2 billion as of March 31, 2026. The ACL coverage of nonperforming loans and leases was 136% at June 30, 2026 compared to 149% at March 31, 2026. as of March 31, 2026. At June 30, 2026, nonperforming assets included $16.3 million of foreclosed assets, consisting primarily of single- base, including among our venture banking clients, or other low cost funding sources necessary to fund our activities particularly in a ended June 30, 2025. The provision for 2026 included a provision for loan losses of $171.8 million, including the impact of the proposed deposits increased by $356.0 million year over year, as a result of a $229.2 million increase in average noninterest-bearing deposits and a rate from 2025 to 2026 is due primarily to the impact of deferred tax asset revaluation recorded following the California state tax changes Average total deposits increased by $299.1 million, with a $323.5 million increase in average interest-bearing deposits, offset partially by a Mr. Wolff continued, "These actions resulted in significant one-time charges, but they increase our long-term earnings power, improve family residences. rising or high interest rate environment; (vii) the rapid withdrawal of a significant amount of demand deposits over a short period of time; targeted loan sale process, offset by a $2.0 million reduction in provision for unfunded loan commitments. Net charge-offs were 2.54% of average loans and leases (annualized) for the second quarter, compared to net charge-offs of 0.23% for the $126.8 million increase in average interest-bearing deposits. Average noninterest-bearing deposits represented 28.7% of average total passed as part of the 2025 California budget enacted on June 30, 2025. $24.4 million decrease in average noninterest-bearing deposits. Average noninterest-bearing deposits represented 28.5% of average total Borrowings capital efficiency and provide greater financial flexibility to support future growth. Just as importantly, they allow us to focus our capital (viii) our ability to achieve or maintain the anticipated benefits of our strategic repositioning due to one or more of the other factors first quarter. deposits for the six months ended June 30, 2026, up from 28.2% for the comparable period in 2025. The average cost of borrowings also deposits in the second quarter, down from 28.9% in the first quarter. The provision for the six months ended June 30, 2025 included the impact of $506.7 million of loans transferred to HFS and recorded at on the businesses, clients and markets where we see the greatest opportunities to create shareholder value.” Borrowings decreased by $90.9 million to $2.5 billion at June 30, 2026 from $2.6 billion at March 31, 2026, driven primarily by the described herein or otherwise, or the failure to complete our anticipated loan sales due to a condition to closing not being satisfied or decreased by 60 basis points to 4.52%, reflecting the paydown of higher-cost borrowings in the prior year and their replacement with ______________ the lower of cost or market value. The remaining increase in the provision for loan losses and unfunded loan commitments was primarily (1) Non-GAAP measure; refer to section 'Non-GAAP Measures' Total loans and leases HFI decreased by $569.5 million in the second quarter to $24.2 billion at June 30, 2026. The decline reflected, in repayment of a long-term FHLB advance. otherwise; (ix) our ability to raise capital or incur debt on reasonable terms; (x) the costs and effects of litigation; (xi) risks related to the (1) Non-GAAP measure; refer to section 'Non-GAAP Measures' lower-cost long-term Federal Home Loan Bank ("FHLB") advances. (1) Common shares outstanding include non-voting common stock equivalents that are participating securities. There were no non‑voting common stock equivalents driven by net charge-off activity experienced in the first half of the year, with additional impacts from changes in loan risk ratings, and part, the transfer of $827.0 million of loans to HFS in connection with the balance sheet repositioning, including $491.9 million of multi- Company’s acquisitions, including disruption to current plans and operations; difficulties in customer and employee retention; fees, outstanding as of June 30, 2026 and March 31, 2026. higher unfunded commitments. These were offset partially by lower qualitative reserves, lower specific reserves, and a favorable shift in The average yield on interest-earning assets declined by 20 basis points to 5.21%, due primarily to a 23 basis point decline in the average family loans, $300.6 million of multi-family construction loans, and $34.5 million of commercial real estate mortgage loans. Excluding the Subordinated Debt expenses and charges related to these transactions being significantly higher than anticipated; and our inability to achieve expected ______________ the portfolio mix due to growth in loan segments with lower expected credit losses. yield on loans and leases. impact of the loans transferred to HFS, the Company continued to generate loan growth in other residential real estate mortgage loans, revenues, cost savings, synergies, and other benefits; (xii) the competitive and other impacts on our business of emerging technologies, On May 1, 2026, the Company redeemed all $385 million outstanding aggregate principal amount of its 3.25% Fixed-to-Floating Rate (1) Common shares outstanding include non-voting common stock equivalents that are participating securities. venture capital loans, and asset-based lending portfolios. Loan production and disbursements totaled $2.8 billion in the second quarter with including stablecoins and other digital currencies, tokenized deposits, blockchain, artificial intelligence, quantum computing, and related Subordinated Notes due 2031 originally issued by Pacific Western Bank. The remaining unamortized discount and debt issuance costs a weighted average interest rate on production of 6.39%. innovations affecting both the Company and the banking industry; (xiii) results of examinations by regulatory authorities of the Company were recorded as a loss on redemption of subordinated notes in noninterest income. As a result of the redemption, subordinated debt and the possibility that any such regulatory authority may, among other things, limit our business activities, restrict our ability to invest in Total loans and leases HFS increased by $656.1 million in the second quarter and totaled $915.2 million at June 30, 2026. The increase decreased to $573.6 million at June 30, 2026, from $954.1 million at March 31, 2026. certain assets, refrain from issuing an approval or non-objection to certain capital or other actions, increase our allowance for credit losses, was primarily driven by the Company's targeted loan sale process discussed above. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23