XML 21 R10.htm IDEA: XBRL DOCUMENT
v3.26.1

BUSINESS COMBINATION | 3 Months Ended
--- | ---
Mar. 31, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract] |
BUSINESS COMBINATION | BUSINESS COMBINATION As discussed in Note 1, “Summary of Significant Accounting Policies,” on September 2, 2025, the Merger by and among Mechanics Bancorp (formerly known as HomeStreet, Inc.), HomeStreet Bank and Mechanics Bank was consummated. As the accounting acquirer, Mechanics Bank remeasured the identifiable assets acquired and liabilities assumed in the Merger as of September 2, 2025, at their acquisition date fair values. In connection with the Merger, each share of common stock, par value $50 per share, of Mechanics Bank voting common stock issued and outstanding was converted into 3,301.0920 shares of the Company’s Class A common stock, no par value, and existing shares of the Company common stock held by legacy Company shareholders were redesignated as the Company’s Class A common stock. In addition, each share of common stock, par value $50 per share, of Mechanics Bank non-voting common stock was converted into 330.1092 shares of the Company’s Class B common stock, no par value. Class A common stock, which was previously known as Company common stock and was previously listed on Nasdaq and traded under the symbol “HMST” through the close of business on August 29, 2025, commenced trading on Nasdaq under the ticker symbol “MCHB” on September 2, 2025. Immediately following the Merger, (1) legacy Mechanics Bank shareholders owned approximately 91.7% of the Company on an economic basis and 91.3% of the voting power of the Company and (2) legacy Company shareholders owned approximately 8.3% of the Company on an economic basis and 8.7% of the voting power of the Company. The Merger was accounted for as a reverse acquisition, with the purchase price determined based on the number of equity interests the legal acquiree would have had to issue to give the owners of the legal acquirer the same percentage equity interest in the combined entity that results from the reverse acquisition. The following table provides the preliminary purchase price allocation and the assets acquired and liabilities assumed at their estimated fair values as of the Merger date, resulting in a preliminary bargain purchase gain of $145.5 million. The estimates of fair value were recorded based on initial valuations at the Merger date and these estimates are considered preliminary as of March 31, 2026, and are subject to adjustment for up to one year after the Merger date, and any changes could be material. In many cases, the determination of fair value required management to make estimates about discount rates, expected future cash flows, market conditions and other future events that are highly subjective in nature and subject to change. Additional information may be obtained during the measurement period that could result in changes to the estimated fair value amounts, and that could result in adjustments to the valuation amounts presented herein. The Company’s taxes are provisional along with the DUS valuation and review of certain contracts assumed in the Merger. The measurement period ends on the earlier of one year after the Merger date or the date the Company concludes that all necessary information about the facts and circumstances that existed as of the Merger date have been obtained.
(in thousands) | September 2, 2025
Net assets identified |  |
Purchase price consideration |  | $ | 265,803 |
Fair value of assets acquired: |  |
Cash and cash equivalents | $ | 156,890 |  |
Total investment securities | 1,028,627 |  |
Loans held for sale | 39,489 |  |
Loans held for investment (1) | 5,645,715 |  |
Allowance for credit losses | (83,746) |  |
Mortgage servicing rights | 89,533 |  |
Premises and equipment | 31,979 |  |
Other intangible assets (2) | 190,913 |  |
Deferred tax assets | 59,960 |  |
Other assets (1) | 283,526 |  |
Total assets acquired (1) | $ | 7,442,886 |  |
Fair value of liabilities assumed: |  |
Deposits | $ | 5,743,725 |  |
FHLB advances | 1,005,370 |  |
Long-term debt | 193,466 |  |
Accrued interest payable and other liabilities | 89,062 |  |
Total liabilities assumed | $ | 7,031,623 |  |
Net assets acquired |  | 411,263 |
Bargain purchase gain |  | $ | 145,460 |
(1)Reflects the adoption of ASU 2025-08. See Note 1, “Summary of Significant Accounting Policies—Adoption of Purchased Seasoned Loans Accounting Standard” for discussion of the adoption of this guidance. (2)Consists of $100.2 million of a DUS license and business line intangible and $90.8 million of core deposit intangible assets. The following table shows the amount of the expenses related to the Merger for the periods indicated:
| Quarter Ended March 31, |  |
(in thousands) | 2026 |  | 2025 |  |  |  |
Severance and employee related | $ | 1,628 |  |  | $ | — |  |  |  |  |
Legal and professional | 2,865 |  |  | 350 |  |  |  |  |
System conversion, integration and other | 301 |  |  | — |  |  |  |  |
Total | $ | 4,794 |  |  | $ | 350 |  |  |  |  |
Pro-Forma Financial Information The following unaudited pro forma consolidated financial information reflects the results of operations of the Company for the quarter ended March 31, 2025, as if the Merger had been completed on January 1, 2024, after giving effect to certain purchase accounting adjustments, primarily related to the preliminary bargain purchase gain, amortization of intangible assets and non-recurring transaction costs. These pro forma results have been prepared for comparative purposes only and are based on estimates and assumptions that have been made solely for purposes of developing such pro forma information and are not necessarily indicative of what the Company’s operating results would have been, had the acquisition actually taken place at the beginning of the annual period prior to the Merger.
| Quarter Ended March 31, |  |
(in thousands) | 2025 |  |  |  |  |  |
Net interest income | $ | 174,399 |  |  |  |  |  |  |
Noninterest income | 26,784 |  |  |  |  |  |  |
Net income before income taxes | 63,883 |  |  |  |  |  |  |

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationAndAssetAcquisitionAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for business combination. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 8 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-8 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 38 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479303/805-10-55-38 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 46 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479303/805-10-55-46 Reference 4: http://www.xbrl.org/2003/role/exampleRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 43 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479303/805-10-55-43 Reference 5: http://www.xbrl.org/2003/role/exampleRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 45 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479303/805-10-55-45 Reference 6: http://www.xbrl.org/2003/role/exampleRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 29 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479303/805-10-55-29 Reference 7: http://www.xbrl.org/2003/role/exampleRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 29 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479303/805-10-55-29 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-5 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d)(1)(ii) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-1 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-3 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479581/805-30-50-3 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479581/805-30-50-2 Reference 15: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479581/805-30-50-1 Reference 16: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (f)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479581/805-30-50-1 Reference 17: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-3 Reference 18: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479581/805-30-50-1 Reference 19: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-2 Reference 20: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-4 Reference 21: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 4 -Subparagraph (a)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479581/805-30-50-4 Reference 22: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-1 Reference 23: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-1 Reference 24: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h)(4) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-2 Reference 25: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (e)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-2 Reference 26: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 40 -Name Accounting Standards Codification -Section 45 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479326/805-40-45-1 Reference 27: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805-30/tableOfContent Reference 28: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805-20/tableOfContent Reference 29: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 7 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-7 Reference 30: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479328/805-10-50-5 Reference 31: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 10 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805-10/tableOfContent + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration