EX-99.1 2 d20338dex991.htm EX-99.1

EX-99.1

Exhibit 99.1

Banc of California Reports Second Quarter Results

IRVINE, Calif., (July 29, 2015) – Banc of California, Inc. (NYSE: BANC) today reported net income of $15.9 million and net income available to common shareholders of $13.1 million, or $0.32 per diluted common share for the quarter ended June 30, 2015. This compares to net income available to common shareholders of $11.7 million, or $0.29 per diluted common share, for the quarter ended March 31, 2015, and net income available to common shareholders of $7.2 million, or $0.27 per diluted common shares, for the year ago quarter ended June 30, 2014.

“Second quarter performance was highlighted by record net income as well as record loan originations of $1.9 billion,” said Steven Sugarman, President and Chief Executive Officer. “We are seeing continued progress realizing the financial returns from the investments we have made in our people, products and infrastructure over the past few years. We continue to remain optimistic about our position as California’s Bank and we are committed to realizing increasing returns for shareholders.”

The Company’s consolidated assets totaled $6.4 billion at June 30, 2015, an increase of $0.3 billion compared to the prior quarter, and an increase of $2.1 billion compared to a year ago. Return on average assets for the second quarter was 1.0%, and return on average tangible common equity was 15% for the second quarter.

Total loans and leases, representing both loans held for investment and held for sale, of $5.2 billion at June 30, 2015 increased by $45 million compared to the prior quarter, and have increased by $1.5 billion compared to the year ago quarter. Loan growth during the second quarter was muted by the sale of $214 million of multifamily loan balances during the quarter. Second quarter origination volumes increased to a record $1.9 billion. Held for investment loan balances increased by $539 million from the prior quarter, as a result of growth in the C&I, CRE and residential portfolios and the transfer of $475 million of jumbo mortgages from held for sale to held for investment during the second quarter.

Total deposits of $5.1 billion at June 30, 2015 increased by $243 million, or 5%, compared to the prior quarter, and have increased by $1.8 billion, or 53%, compared to the year ago quarter. Noninterest-bearing deposits increased by $132 million, or 18%, compared to the prior quarter, and have increased by $472 million, or 116%, compared to the year ago quarter.

Total revenue of $120.8 million for the second quarter increased by $22.8 million, or 23%, compared with the prior quarter, and increased by $49.9 million, or 70%, compared to the year ago quarter.

Second quarter net interest income of $54.1 million increased by $2.1 million, or 4%, from the prior quarter, and increased by $18.5 million, or 52%, compared to the year ago quarter.

The consolidated net interest margin for the second quarter was 3.64%, a decrease of 5 basis points from 3.69% reported in the prior quarter, largely driven by increased interest expense associated with the April debt offering. The net interest margin for Banc of California, N.A. was 3.92% for the second quarter, an increase of 8 basis points from prior quarter. Cost of total deposits for the second quarter was 0.50%, down 4 basis points from the prior quarter.

18500 Von Karman Ave. ● Suite 1100 ● Irvine, CA 92612 ● (949) 236-5250 ● www.bancofcal.com

Noninterest income for the second quarter totaled $66.7 million, including $9.9 million related to the sale of the Costa Mesa building, compared to $46.0 million for the prior quarter and $35.4 million for the year ago quarter. Mortgage banking income totaled $39.4 million for the second quarter, compared to $37.9 million for the prior quarter and $26.1 million for the year ago quarter. Agency and conforming origination and sales volumes increased from the prior quarter, while the gain on sale margin compressed from the prior quarter, contributing to net higher mortgage banking income for the second quarter.

Total noninterest expense for the first quarter totaled $87.9 million, an increase of $12.0 million compared to the prior quarter. Higher noninterest expense during the second quarter included approximately $2.3 million of non-recurring costs related to the sale of the Costa Mesa building as well as $4.8 million of higher volume and bonus-related compensation expense, primarily as a result of increased origination volumes and profitability.

The Company’s allowance for loan and lease losses (ALLL) ended the quarter at $34.8 million, and equaled 1.27% of originated loans, and represented a coverage ratio of 81% of nonperforming loans at June 30, 2015. Second quarter provision for loan losses was $5.5 million, which included a one-time provision of $4.5 million to establish an initial ALLL for the loans transferred to held for investment during the quarter. The ratio of delinquent non-PCI loans to total non-PCI loans equaled 1.66% for the second quarter, flat from the prior quarter, and down from 2.69% a year ago. The ratio of nonperforming assets to total assets stood at 0.66% for the second quarter. Net charge offs for the second quarter were less than $0.1 million, relatively flat from $0.1 million during the prior quarter.

The Company remains well-capitalized with a Tier 1 Risk-Based Capital Ratio of 13.2%, a Tier 1 Leverage Ratio of 9.6%, Common Equity Tier 1 Capital Ratio of 9.0%, and a Tangible Equity to Tangible Assets Ratio (TE/TA) of 9.1%, as of June 30, 2015. The Tier 1 Leverage Ratio for Banc of California, N.A. increased from 9.5% to 10.3% as of June 30, 2015.

The Company will host a conference call to discuss its second quarter financial results at 8:00 a.m. Pacific Time (PT) on Thursday, July 30, 2015. Interested parties are welcome to attend the conference call by dialing 888-317-6003, and referencing event code 7245884. A live audio webcast will also be available and the webcast link will be posted on the Company’s website under the Investors section. The slide presentation for the call will also be available on the Company’s website prior to the call.

About Banc of California, Inc.

Banc of California, Inc. (NYSE: BANC) provides comprehensive banking services to California’s diverse private businesses, entrepreneurs and homeowners. Banc of California operates over 100 offices in California and the West.

Forward-Looking Statements

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

Source: Banc of California, Inc.

INVESTOR RELATIONS INQUIRIES:		MEDIA INQUIRIES:
Banc of California, Inc.		Vectis Strategies
Timothy Sedabres, (855) 361-2262		David Herbst, (213) 973-4113 x101

2

Banc of California, Inc

Consolidated Statements of Financial Condition

(Dollars in thousands)

(Unaudited)

		June 30,				March 31,				December 31,				September 30,				June 30,
		2015				2015				2014				2014				2014
ASSETS
Cash and cash equivalents		$	458,990			$	265,402			$	231,199			$	184,985			$	258,051
Time deposits in financial institutions			1,900				1,900				1,900				1,900				2,145
Securities available for sale			487,293				393,586				345,695				310,385				233,013
Securities held to maturity			53,414				—				—				—				—
Loans held for sale			746,651				1,240,942				1,187,090				1,127,339				1,095,741
Loans and leases receivable			4,473,095				3,933,715				3,949,122				2,712,068				2,602,213
Allowance for loan and lease losses			(34,787	)			(29,345	)			(29,480	)			(25,283	)			(22,627	)
Federal Home Loan Bank and other bank stock			34,187				39,844				42,241				35,432				34,392
Servicing rights, net			34,942				21,829				19,566				11,745				10,191
Other real estate owned, net			50				498				423				605				605
Premises and equipment, net			35,229				78,285				78,685				67,323				67,457
Goodwill			31,591				31,591				31,591				31,591				32,150
Other intangible assets, net			21,905				23,708				25,252				10,829				10,959
Deferred income tax (1)			12,081				14,157				16,373				8,663				2,546
Income tax receivable			3,091				—				—				—				—
Bank-owned life insurance investment			19,201				19,154				19,095				19,038				18,984
Other assets (1)			59,049				62,089				52,545				41,206				40,511
Total assets		$	6,437,882			$	6,097,355			$	5,971,297			$	4,537,826			$	4,386,331
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits
Noninterest-bearing deposits		$	867,930			$	749,129			$	662,295			$	457,743			$	408,404
Interest-bearing deposits			4,184,260				4,112,863				4,009,536				3,173,967				2,938,951
Deposits held for sale			52,820				—				—				—				—
Total deposits			5,105,010				4,861,992				4,671,831				3,631,710				3,347,355
Advances from Federal Home Loan Bank			350,000				545,000				633,000				305,000				450,000
Other borrowings			—				15,000				—				—				—
Notes payable, net			264,077				92,668				93,569				95,549				96,481
Reserve for loss reimbursements on sold loans			9,411				8,432				8,303				7,045				6,174
Income taxes payable			—				4,488				56				2,158				31
Accrued expenses and other liabilities			75,502				55,615				61,223				49,653				47,163
Total liabilities			5,804,000				5,583,195				5,467,982				4,091,115				3,947,204
Commitments and contingent liabilities
Preferred stock, Series A, non-cumulative perpetual preferred stock			31,934				31,934				31,934				31,934				31,934
Preferred stock, Series B, non-cumulative perpetual preferred stock			10,000				10,000				10,000				10,000				10,000
Preferred stock, Series C, 8.00% non-cumulative perpetual preferred stock			37,943				37,943				37,943				37,943				37,943
Preferred stock, Series D, 7.375% non-cumulative perpetual preferred stock			110,873				—				—				—				—
Common stock			372				367				358				297				287
Common stock, class B non-voting non-convertible			—				—				6				6				6
Additional paid-in capital			425,784				424,636				422,910				371,738				369,530
Retained earnings (1)			45,494				36,880				29,589				24,692				18,588
Treasury stock			(29,070	)			(29,798	)			(29,798	)			(29,798	)			(29,652	)
Accumulated other comprehensive (loss)/income, net			552				2,198				373				(101	)			491
Total stockholders’ equity			633,882				514,160				503,315				446,711				439,127
Total liabilities and stockholders’ equity		$	6,437,882			$	6,097,355			$	5,971,297			$	4,537,826			$	4,386,331

(1) Amounts for 2014 periods have been updated to reflect the first quarter 2015 adoption of ASU 2014-1 related to investment in low income housing tax credit.

3

Banc of California, Inc

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

(Unaudited)

		Three Months Ended																				Six Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,				June 30,				June 30,
		2015				2015				2014				2014				2014				2015				2014
Interest and dividend income
Loans, including fees		$	60,699			$	58,155			$	52,599			$	44,555			$	42,077			$	118,854			$	83,607
Securities			2,119				1,927				1,781				1,460				993				4,046				1,917
Dividends and other interest-earning assets			2,026				698				700				634				564				2,724				886
Total interest and dividend income			64,844				60,780				55,080				46,649				43,634				125,624				86,410
Interest expense
Deposits			6,165				6,361				6,440				6,165				6,071				12,526				11,806
Federal Home Loan Bank advances			290				353				210				118				99				643				199
Notes payable and other interest-bearing liabilities			4,285				2,069				2,099				2,180				1,889				6,354				3,645
Total interest expense			10,740				8,783				8,749				8,463				8,059				19,523				15,650
Net interest income			54,104				51,997				46,331				38,186				35,575				106,101				70,760
Provision for loan and lease losses			5,474				—				4,159				2,780				2,108				5,474				4,037
Net interest income after provision for loan and lease losses			48,630				51,997				42,172				35,406				33,467				100,627				66,723
Noninterest income
Customer service fees			1,072				910				651				230				356				1,982				609
Net gain on sale of loans			7,838				4,472				3,927				10,260				3,038				12,310				5,641
Mortgage banking income			39,403				37,933				25,030				26,943				26,133				77,336				43,457
Advisory service fees			4,435				1,197				6,722				3,264				1,808				5,632				2,918
Loan brokerage income			661				1,141				2,314				2,033				2,416				1,802				4,327
Gain on sale of building			9,919				—				—				—				—				9,919				—
All other income			3,365				327				2,245				1,368				1,621				3,692				3,698
Total noninterest income			66,693				45,980				40,889				44,098				35,372				112,673				60,650
Noninterest expense
Salaries and employee benefits			56,120				49,771				47,974				41,094				39,130				105,891				73,811
Occupancy and equipment			10,325				9,771				9,512				7,969				7,425				20,096				15,962
Professional fees			6,689				3,435				7,096				4,758				3,528				10,124				7,393
Data processing			2,075				1,835				1,884				1,286				1,270				3,910				2,061
Amortization of intangible assets			1,545				1,544				1,306				890				944				3,089				1,883
All other expenses (1)			11,166				9,523				10,448				11,357				8,007				20,689				16,788
Total noninterest expense			87,920				75,879				78,220				67,354				60,304				163,799				117,898
Income before income taxes			27,403				22,098				4,841				12,150				8,535				49,501				9,475
Income tax (benefit) expense (1)			11,479				9,524				(5,269	)			903				436				21,003				627
Net income			15,924				12,574				10,110				11,247				8,099				28,498				8,848
Preferred stock dividends			2,843				910				910				910				910				3,753				1,820
Net income available to common stockholders		$	13,081			$	11,664			$	9,200			$	10,337			$	7,189			$	24,745			$	7,028
Basic earnings per total common share		$	0.33			$	0.30			$	0.25			$	0.31			$	0.27			$	0.62			$	0.30
Diluted earnings per total common share		$	0.32			$	0.29			$	0.25			$	0.31			$	0.27			$	0.62			$	0.30

(1) Amounts for 2014 periods have been updated to reflect the first quarter 2015 adoption of ASU 2014-1 related to investment in low income housing tax credit.

4

Banc of California, Inc

Selected Financial Data

(Dollars in thousands)

(Unaudited)

		Three Months Ended																				Six Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,				June 30,				June 30,
		2015				2015				2014				2014				2014				2015				2014
Average balances:
Total assets		$	6,253,350			$	5,931,426			$	5,223,463			$	4,391,523			$	4,034,447			$	6,093,277			$	3,882,154
Total gross loans and leases			5,254,729				5,139,399				4,534,428				3,829,204				3,553,693				5,197,382				3,422,420
Investment Securities			402,366				354,475				310,454				257,067				168,230				378,553				165,633
Total interest earning assets			5,967,200				5,713,766				5,033,973				4,228,555				3,858,772				5,841,183				3,714,235
Total interest-bearing deposits			4,078,540				4,085,673				3,699,464				3,070,130				2,855,650				4,082,087				2,724,992
Total borrowings			635,460				583,979				406,531				378,671				319,774				609,862				335,117
Total interest bearing liabilities			4,714,000				4,669,652				4,105,995				3,448,801				3,175,424				4,691,949				3,060,109
Total stockholders’ equity			630,547				517,335				487,578				449,392				385,098				574,254				357,511
Profitability and other ratios:
Return on average assets (1)			1.02	%			0.86	%			0.77	%			1.02	%			0.81	%			0.94	%			0.46	%
Return on average equity (1)			10.13	%			9.86	%			8.23	%			9.93	%			8.44	%			10.01	%			4.99	%
Dividend payout ratio (2)			36.36	%			40.00	%			48.00	%			38.71	%			44.44	%			38.71	%			80.00	%
Net interest spread			3.45	%			3.55	%			3.49	%			3.41	%			3.52	%			3.50	%			3.66	%
Net interest margin (1)			3.64	%			3.69	%			3.65	%			3.58	%			3.70	%			3.66	%			3.84	%
Noninterest income to total revenue (3)			55.21	%			46.93	%			46.88	%			53.59	%			49.86	%			51.50	%			46.15	%
Noninterest income to average total assets (1)			4.28	%			3.14	%			3.11	%			3.98	%			3.52	%			3.73	%			3.15	%
Noninterest expense to average total assets (1)			5.64	%			5.19	%			5.94	%			6.08	%			6.00	%			5.42	%			6.12	%
Efficiency ratio (4)			72.78	%			77.45	%			89.68	%			81.86	%			85.00	%			74.87	%			89.72	%
Average held for investment loans and leases to average deposits			79.87	%			81.72	%			79.08	%			75.39	%			74.60	%			74.60	%			74.60	%
Average investment securities to average total assets			6.43	%			5.98	%			5.94	%			5.85	%			4.17	%			6.21	%			4.27	%
Average stockholders’ equity to average total assets			10.08	%			8.72	%			9.33	%			10.23	%			9.55	%			9.42	%			9.21	%
Allowance for loan and lease losses (ALLL):
Balance at beginning of period		$	29,345			$	29,480			$	25,283			$	22,627			$	20,003			$	29,480			$	18,805
Loans and leases charged off			(79	)			(357	)			(25	)			(312	)			(383	)			(436	)			(586	)
Recoveries of loans and leases previously charged off			47				222				63				96				641				269				1,076
Transfer of loans from (to) held-for-sale			—				—				—				92				258				—				(705	)
Provision for loan and lease losses			5,474				—				4,159				2,780				2,108				5,474				4,037
Balance at end of period		$	34,787			$	29,345			$	29,480			$	25,283			$	22,627			$	34,787			$	22,627
Reserve for loss on repurchased loans
Balance at beginning of period		$	8,432			$	8,303			$	7,045			$	6,174			$	5,866			$	8,303			$	5,427
Provision for loan repurchases			1,573				1,328				1,149				1,556				968				2,901				1,539
Payment made for loss reimbursement on sold loans			(594	)			(1,199	)			109				(685	)			(660	)			(1,793	)			(792	)
Balance at end of period		$	9,411			$	8,432			$	8,303			$	7,045			$	6,174			$	9,411			$	6,174

(1) Ratios are presented on an annualized basis.

(2) Dividends declared per common share divided by basic earnings per share.

(3) Total revenue is equal to the sum of net interest income before provision and noninterest income.

(4) The ratios were calculated by dividing noninterest expense by the sum of net interest income before provision for loan and lease losses and noninterest income.

5

Banc of California, Inc

Selected Financial Data, Continued

(Dollars in thousands)

(Unaudited)

		June 30,				March 31,				December 31,				September 30,				June 30,
		2015				2015				2014				2014				2014
Asset quality information and ratios:
30 to 89 days delinquent, excluding PCI loans		$	46,820			$	40,641			$	40,694			$	35,531			$	44,894
90+ days delinquent, excluding PCI loans			22,855				20,538				16,835				15,672				16,925
Total delinquent loans, excluding PCI loans			69,675				61,179				57,529				51,203				61,819
PCI loans, 30 to 89 days delinquent			17,351				16,375				17,641				18,743				25,109
PCI loans, 90+ days delinquent			8,648				6,986				5,761				4,017				12,398
Total delinquent PCI loans			25,999				23,361				23,402				22,760				37,507
Total delinquent loans		$	95,674			$	84,540			$	80,931			$	73,963			$	99,326
Total delinquent non-PCI loans to total non-PCI loans			1.66	%			1.66	%			1.55	%			2.08	%			2.69	%
Total delinquent loans to gross loans			2.14	%			2.15	%			2.05	%			2.73	%			3.82	%
Non-performing loans, excluding PCI loans		$	42,708			$	42,754			$	38,381			$	38,333			$	41,611
90+ days delinquent and still accruing loans, excluding PCI loans			—				—				—				—				—
Other real estate owned			50				498				423				605				605
Non-performing assets		$	42,758			$	43,252			$	38,804			$	38,938			$	42,216
ALLL to non-performing loans			81.45	%			68.64	%			76.81	%			65.96	%			54.38	%
Non-performing loans to gross loans			0.95	%			1.09	%			0.97	%			1.41	%			1.60	%
Non-performing assets to total assets			0.66	%			0.71	%			0.65	%			0.86	%			0.96	%
Troubled Debt Restructurings (TDRs)
Performing TDRs		$	7,402			$	7,431			$	6,346			$	5,071			$	4,853
Non-performing TDRs			1,937				1,964				1,665				2,860				1,879
Total TDRs		$	9,339			$	9,395			$	8,011			$	7,931			$	6,732

6

Banc of California, Inc

Selected Financial Data, Continued

(Dollars in thousands)

(Unaudited)

		June 30,				March 31,				December 31,				September 30,				June 30,
		2015				2015				2014				2014				2014
Loan and lease breakdown by ALLL evaluation type:
Originated loans and leases
Individually evaluated for impairment		$	31,791			$	29,301			$	29,287			$	29,030			$	29,763
Collectively evaluated for impairment			2,489,347				1,947,212				1,892,240				1,668,004				1,447,077
Acquired loans through business acquisitions - non-impaired
Individually evaluated for impairment			8				2,818				4,191				8,004				6,173
Collectively evaluated for impairment			1,294,384				1,358,184				1,411,927				377,554				409,745
Seasoned SFR mortgage loan pools - non-impaired			391,193				354,402				364,580				376,575				404,398
Acquired with deteriorated credit quality			266,372				241,798				246,897				252,901				305,057
Total loans		$	4,473,095			$	3,933,715			$	3,949,122			$	2,712,068			$	2,602,213
ALLL breakdown:
Originated loans and leases
Individually evaluated for impairment		$	686			$	1,199			$	1,288			$	517			$	309
Collectively evaluated for impairment			31,440				25,474				25,263				22,011				19,427
Acquired loans through business acquisitions - non-impaired
Individually evaluated for impairment			—				—				—				7				—
Collectively evaluated for impairment			2,455				2,466				2,906				2,748				2,570
Seasoned SFR mortgage loan pools - non-impaired			—				—				—				—				—
Acquired with deteriorated credit quality			206				206				23				—				321
Total ALLL		$	34,787			$	29,345			$	29,480			$	25,283			$	22,627
Discount on Purchased/Acquired Loans:
Acquired loans through business acquisitions - non-impaired		$	15,245			$	16,877			$	17,866			$	6,512			$	6,536
Seasoned SFR mortgage loan pools - non-impaired			29,201				28,967				29,955				30,811				33,044
Acquired with deteriorated credit quality			52,394				53,381				55,865				57,961				84,876
Total Discount		$	96,840			$	99,225			$	103,686			$	95,284			$	124,456
Ratios:
To originated loans:
Individually evaluated for impairment			2.16	%			4.09	%			4.40	%			1.78	%			1.04	%
Collectively evaluated for impairment			1.26	%			1.31	%			1.34	%			1.32	%			1.34	%
Total ALLL			1.27	%			1.35	%			1.38	%			1.33	%			1.34	%
To originated and acquired non-impaired loans:
Individually evaluated for impairment			2.16	%			3.73	%			3.85	%			1.41	%			0.86	%
Collectively evaluated for impairment			0.90	%			0.85	%			0.85	%			1.21	%			1.18	%
Total ALLL			0.91	%			0.87	%			0.88	%			1.21	%			1.18	%
Total ALLL and discount (1)			1.31	%			1.38	%			1.42	%			1.53	%			1.52	%
To total loans:
Individually evaluated for impairment			2.16	%			3.73	%			3.85	%			1.41	%			0.86	%
Collectively evaluated for impairment			0.81	%			0.76	%			0.77	%			1.02	%			0.97	%
Total ALLL			0.78	%			0.75	%			0.75	%			0.93	%			0.87	%
Total ALLL and discount (1)			2.94	%			3.27	%			3.37	%			4.45	%			5.65	%

(1) The ratios were calculated by dividing a sum of ALLL and discounts by carrying value of loans.

7

Banc of California, Inc

Selected Financial Data, Continued

(Dollars in thousands)

(Unaudited)

		June 30,				March 31,				December 31,				September 30,				June 30,
		2015				2015				2014				2014				2014
Composition of held for investment loans and leases
Commercial real estate		$	807,146			$	975,734			$	999,857			$	521,867			$	535,744
Multi-family			696,768				940,053				955,683				367,364				234,179
Construction			32,022				38,081				42,198				25,997				30,761
Commercial and industrial			771,477				489,229				490,900				366,416				368,540
SBA			56,887				48,254				36,155				25,729				28,684
Lease financing			131,189				102,012				85,749				72,027				57,754
Total commercial loans			2,495,489				2,593,363				2,610,542				1,379,400				1,255,662
Single family residential mortgage			1,840,924				1,169,134				1,171,662				1,191,021				1,212,813
Other consumer			136,682				171,218				166,918				141,647				133,738
Total consumer loans			1,977,606				1,340,352				1,338,580				1,332,668				1,346,551
Total gross loans and leases		$	4,473,095			$	3,933,715			$	3,949,122			$	2,712,068			$	2,602,213
Composition percentage of held for investment loans and leases
Commercial real estate			18.0	%			24.8	%			25.3	%			19.2	%			20.6	%
Multi-family			15.6	%			23.9	%			24.2	%			13.5	%			9.0	%
Construction			0.7	%			1.0	%			1.1	%			1.0	%			1.2	%
Commercial and industrial			17.2	%			12.4	%			12.4	%			13.5	%			14.2	%
SBA			1.3	%			1.2	%			0.9	%			0.9	%			1.1	%
Lease financing			2.9	%			2.6	%			2.2	%			2.7	%			2.2	%
Total commercial loans			55.7	%			65.9	%			66.1	%			50.8	%			48.3	%
Single family residential mortgage			41.2	%			29.7	%			29.7	%			44.0	%			46.6	%
Other consumer			3.1	%			4.4	%			4.2	%			5.2	%			5.1	%
Total consumer loans			44.3	%			34.1	%			33.9	%			49.2	%			51.7	%
Total gross loans and leases			100.0	%			100.0	%			100.0	%			100.0	%			100.0	%
Composition of deposits
Noninterest-bearing checking		$	880,766			$	749,129			$	662,295			$	457,743			$	408,404
Interest-bearing checking			1,002,443				1,032,482				1,054,828				779,704				688,699
Money market			1,393,751				1,136,562				1,074,432				769,291				618,231
Savings			843,274				898,483				985,646				932,133				985,028
Certificates of deposit			984,776				1,045,336				894,630				692,839				646,993
Total deposits		$	5,105,010			$	4,861,992			$	4,671,831			$	3,631,710			$	3,347,355
Composition percentage of deposits
Noninterest-bearing checking			17.3	%			15.4	%			14.2	%			12.6	%			12.2	%
Interest-bearing checking			19.6	%			21.2	%			22.6	%			21.5	%			20.6	%
Money market			27.3	%			23.4	%			23.0	%			21.2	%			18.5	%
Savings			16.5	%			18.5	%			21.1	%			25.6	%			29.4	%
Certificates of deposit			19.3	%			21.5	%			19.1	%			19.1	%			19.3	%
Total deposits			100.0	%			100.0	%			100.0	%			100.0	%			100.0	%

8

Banc of California, Inc

Average Balance, Average Yield Earned, and Average Cost Paid

(Dollars in thousands)

(Unaudited)

		Three Months Ended
		June 30, 2015												March 31, 2015												December 31, 2014
		Average								Yield				Average								Yield				Average								Yield
		Balance				Interest				/ Cost				Balance				Interest				/ Cost				Balance				Interest				/ Cost
Interest earning assets:
Loans held for sale and SFR mortgage		$	1,959,738			$	18,984				3.89	%		$	1,868,085			$	17,477				3.79	%		$	1,778,112			$	16,741				3.74	%
Seasoned SFR mortgage loan pools			591,460				9,690				6.57	%			591,724				9,413				6.45	%			606,879				9,605				6.28	%
Commercial real estate, multi-family, and construction			1,848,780				21,552				4.68	%			1,956,830				22,508				4.66	%			1,486,406				17,993				4.80	%
Commercial and industrial, SBA, and lease financing			697,291				8,871				5.10	%			572,726				7,239				5.13	%			523,194				6,192				4.70	%
Other consumer			157,460				1,602				4.08	%			150,034				1,518				4.10	%			139,837				2,068				5.87	%
Gross loans and leases			5,254,729				60,699				4.63	%			5,139,399				58,155				4.59	%			4,534,428				52,599				4.60	%
Securities			402,366				2,119				2.11	%			354,475				1,927				2.20	%			310,454				1,781				2.28	%
Other interest-earning assets			310,105				2,026				2.62	%			219,892				698				1.29	%			189,091				700				1.47	%
Total interest-earning assets			5,967,200				64,844				4.36	%			5,713,766				60,780				4.31	%			5,033,973				55,080				4.34	%
Allowance for loan and lease losses			(29,445	)											(29,623	)											(26,105	)
BOLI and non-interest earning assets			315,595												247,283												215,595
Total assets		$	6,253,350											$	5,931,426											$	5,223,463
Interest-bearing liabilities:
Savings		$	867,532			$	1,606				0.74	%		$	945,530			$	1,748				0.75	%		$	960,253			$	1,963				0.81	%
Interest-bearing checking			1,012,211				1,996				0.79	%			1,042,895				2,041				0.79	%			937,623				2,078				0.88	%
Money market			1,142,858				1,028				0.36	%			1,092,987				958				0.36	%			964,414				841				0.35	%
Certificates of deposit			1,055,939				1,535				0.58	%			1,004,261				1,614				0.65	%			837,174				1,558				0.74	%
Total interest-bearing deposits			4,078,540				6,165				0.61	%			4,085,673				6,361				0.63	%			3,699,464				6,440				0.69	%
FHLB advances			375,385				290				0.31	%			487,600				353				0.29	%			307,859				210				0.27	%
Long-term debt and other interest-bearing liabilities			260,075				4,285				6.61	%			96,379				2,069				8.71	%			98,672				2,099				8.44	%
Total interest-bearing liabilities			4,714,000				10,740				0.91	%			4,669,652				8,783				0.76	%			4,105,995				8,749				0.85	%
Noninterest-bearing deposits			859,420												682,492												577,623
Non-interest-bearing liabilities			49,383												61,947												52,267
Total liabilities			5,622,803												5,414,091												4,735,885
Total stockholders’ equity			630,547												517,335												487,578
Total liabilities and stockholders’ equity		$	6,253,350											$	5,931,426											$	5,223,463
Net interest income/spread						$	54,104				3.45	%						$	51,997				3.55	%						$	46,331				3.49	%
Net interest margin											3.64	%											3.69	%											3.65	%
Ratio of interest-earning assets to interest-bearing liabilities			126.58	%											122.36	%											122.60	%
Total deposits		$	4,937,960			$	6,165				0.50	%		$	4,768,165			$	6,361				0.54	%		$	4,277,087			$	6,440				0.60	%
Total funding (1)		$	5,573,420			$	10,740				0.77	%		$	5,352,144			$	8,783				0.67	%		$	4,683,618			$	8,749				0.76	%

(1) Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total fundings.

9

Banc of California, Inc

Average Balance, Average Yield Earned, and Average Cost Paid, Continued

(Dollars in thousands)

(Unaudited)

		Three Months Ended
		September 30, 2014												June 30, 2014
		Average								Yield				Average								Yield
		Balance				Interest				/ Cost				Balance				Interest				/ Cost
Interest earning assets:
Loans held for sale and SFR mortgage		$	1,757,890			$	16,979				3.83	%		$	1,590,982			$	15,158				3.82	%
Seasoned SFR mortgage loan pools			675,083				11,753				6.91	%			701,006				11,723				6.71	%
Commercial real estate, multi-family, and construction			827,934				9,592				4.60	%			734,472				8,689				4.75	%
Commercial and industrial, SBA, and lease financing			451,992				5,060				4.44	%			418,170				5,413				5.19	%
Other consumer			116,305				1,171				3.99	%			109,063				1,094				4.02	%
Gross loans and leases			3,829,204				44,555				4.62	%			3,553,693				42,077				4.75	%
Securities			257,067				1,460				2.25	%			168,230				993				2.37	%
Other interest-earning assets			142,284				634				1.77	%			136,849				564				1.65	%
Total interest-earning assets			4,228,555				46,649				4.38	%			3,858,772				43,634				4.54	%
Allowance for loan and lease losses			(23,266	)											(20,567	)
BOLI and non-interest earning assets			186,234												196,242
Total assets		$	4,391,523											$	4,034,447
Interest-bearing liabilities:
Savings		$	953,925			$	2,215				0.92	%		$	990,894			$	2,425				0.98	%
Interest-bearing checking			745,635				2,037				1.08	%			660,341				1,864				1.13	%
Money market			681,576				673				0.39	%			603,917				639				0.42	%
Certificates of deposit			688,994				1,240				0.71	%			600,498				1,143				0.76	%
Total interest-bearing deposits			3,070,130				6,165				0.80	%			2,855,650				6,071				0.85	%
FHLB advances			276,739				118				0.17	%			226,429				99				0.18	%
Long-term debt and other interest-bearing liabilities			101,932				2,180				8.48	%			93,345				1,889				8.12	%
Total interest-bearing liabilities			3,448,801				8,463				0.97	%			3,175,424				8,059				1.02	%
Noninterest-bearing deposits			448,825												428,221
Non-interest-bearing liabilities			44,505												45,704
Total liabilities			3,942,131												3,649,349
Total stockholders’ equity			449,392												385,098
Total liabilities and stockholders’ equity		$	4,391,523											$	4,034,447
Net interest income/spread						$	38,186				3.41	%						$	35,575				3.52	%
Net interest margin											3.58	%											3.70	%
Ratio of interest-earning assets to interest-bearing liabilities			122.61	%											121.52	%
Total deposits		$	3,518,955			$	6,165				0.70	%		$	3,283,871			$	6,071				0.74	%
Total funding (1)		$	3,897,626			$	8,463				0.88	%		$	3,603,645			$	8,059				0.90	%

(1) Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total fundings.

10

Banc of California, Inc

Average Balance, Average Yield Earned, and Average Cost Paid, Continued

(Dollars in thousands)

(Unaudited)

		Six Months Ended
		June 30, 2015												June 30, 2014
		Average								Yield				Average								Yield
		Balance				Interest				/ Cost				Balance				Interest				/ Cost
Interest earning assets:
Loans held for sale and SFR mortgage		$	1,914,165			$	36,461				3.84	%		$	1,494,850			$	28,549				3.85	%
Seasoned SFR mortgage loan pools			591,591				19,103				6.51	%			725,960				24,795				6.89	%
Commercial real estate, multi-family, and construction			1,902,507				44,060				4.67	%			709,407				16,909				4.81	%
Commercial and industrial, SBA, and lease financing			635,353				16,110				5.11	%			388,089				11,306				5.87	%
Other consumer			153,766				3,120				4.09	%			104,114				2,048				3.97	%
Gross loans and leases			5,197,382				118,854				4.61	%			3,422,420				83,607				4.93	%
Securities			378,553				4,046				2.16	%			165,633				1,917				2.33	%
Other interest-earning assets			265,248				2,724				2.07	%			126,182				886				1.42	%
Total interest-earning assets			5,841,183				125,624				4.34	%			3,714,235				86,410				4.69	%
Allowance for loan and lease losses			(29,533	)											(19,983	)
BOLI and non-interest earning assets			281,627												187,902
Total assets		$	6,093,277											$	3,882,154
Interest-bearing liabilities:
Savings		$	906,316			$	3,354				0.75	%		$	978,695			$	4,942				1.02	%
Interest-bearing checking			1,027,468				4,037				0.79	%			626,919				3,515				1.13	%
Money market			1,118,060				1,986				0.36	%			559,769				1,275				0.46	%
Certificates of deposit			1,030,243				3,149				0.62	%			559,609				2,074				0.75	%
Total interest-bearing deposits			4,082,087				12,526				0.62	%			2,724,992				11,806				0.87	%
FHLB advances			431,182				643				0.30	%			242,928				199				0.17	%
Long-term debt and other interest-bearing liabilities			178,680				6,354				7.17	%			92,189				3,645				7.97	%
Total interest-bearing liabilities			4,691,949				19,523				0.84	%			3,060,109				15,650				1.03	%
Noninterest-bearing deposits			771,445												422,181
Non-interest-bearing liabilities			55,629												42,353
Total liabilities			5,519,023												3,524,643
Total stockholders’ equity			574,254												357,511
Total liabilities and stockholders’ equity		$	6,093,277											$	3,882,154
Net interest income/spread						$	106,101				3.50	%						$	70,760				3.66	%
Net interest margin											3.66	%											3.84	%
Ratio of interest-earning assets to interest-bearing liabilities
Total deposits		$	4,853,532			$	12,526				0.52	%		$	3,147,173			$	11,806				0.76	%
Total funding (1)		$	5,463,394			$	19,523				0.72	%		$	3,482,290			$	15,650				0.91	%

(1) Total funding is the sum of interest-bearing liabilities and noninterest-bearing deposits. The cost of total funding is calculated as annualized total interest expense divided by average total fundings.

11

Banc of California, Inc

Capital Ratios

(Unaudited)

		June 30,				March 31,				December 31,				September 30,				June 30,
		2015				2015 (1)				2014				2014				2014
Capital Ratios:
Banc of California, Inc.
Total risk-based capital ratio:			14.01	%			11.55	%			11.28	%			14.97	%			15.19	%
Tier 1 risk-based capital ratio:			13.19	%			10.83	%			10.54	%			14.03	%			14.10	%
Common equity tier 1 capital ratio (1)			8.96	%			9.01	%			N/A				N/A				N/A
Tier 1 leverage ratio:			9.55	%			7.99	%			8.57	%			9.28	%			9.89	%
Banc of California, NA
Total risk-based capital ratio:			14.86	%			13.58	%			12.04	%			15.75	%			14.88	%
Tier 1 risk-based capital ratio:			14.04	%			12.86	%			11.29	%			14.80	%			13.79	%
Common equity tier 1 capital ratio (1)			14.04	%			12.86	%			N/A				N/A				N/A
Tier 1 leverage ratio:			10.26	%			9.49	%			9.17	%			9.80	%			9.72	%

(1) From the first quarter of 2015, BASEL III common equity tier 1 capital ratio is required.

12

Banc of California, Inc

Non-GAAP Measures

(Dollars in thousands, except per share data)

(Unaudited)

Non-GAAP performance measure:

Tangible common equity to tangible assets ratio and return on average tangible common equity are supplemental financial information determined by a method other than in accordance with U.S. generally accepted accounting principles (“GAAP”). These non-GAAP measures are used by management in the analysis of Banc of California, Inc.’s capital strength and performance of businesses. Tangible equity is calculated by subtracting goodwill and other intangible assets from total stockholders’ equity. Banking and financial institution regulators also exclude goodwill and other intangible assets from total stockholders’ equity when assessing the capital adequacy of a financial institution. Management believes the presentation of this financial measure excluding the impact of these items provides useful supplemental information that is essential to a proper understanding of the capital strength of Banc of California, Inc. This disclosure should not be viewed as a substitution for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies.

The following tables reconcile this non-GAAP performance measures to the GAAP performance measures for the periods indicated:

		June 30,				March 31,				December 31,				September 30,				June 30,
		2015				2015				2014				2014				2014
Tangible common equity to tangible assets ratio
Total assets		$	6,437,882			$	6,097,355			$	5,971,297			$	4,537,826			$	4,386,331
Less goodwill			(31,591	)			(31,591	)			(31,591	)			(31,591	)			(32,150	)
Less other intangible assets			(21,905	)			(23,708	)			(25,252	)			(10,829	)			(10,959	)
Tangible assets		$	6,384,386			$	6,042,056			$	5,914,454			$	4,495,406			$	4,343,222
Total stockholders’ equity		$	633,882			$	514,160			$	503,315			$	446,711			$	439,127
Less preferred stock			(190,750	)			(79,877	)			(79,877	)			(79,877	)			(79,877	)
Less goodwill			(31,591	)			(31,591	)			(31,591	)			(31,591	)			(32,150	)
Less other intangible assets			(21,905	)			(23,708	)			(25,252	)			(10,829	)			(10,959	)
Tangible common equity		$	389,636			$	378,984			$	366,595			$	324,414			$	316,141
Total stockholders’ equity to total assets			9.85	%			8.43	%			8.43	%			9.84	%			10.01	%
Tangible common equity to tangible assets			6.10	%			6.27	%			6.20	%			7.22	%			7.28	%
Common stock outstanding			35,647,476				35,063,199				34,190,740				28,023,701				27,032,464
Class B non-voting non-convertible common stock outstanding			—				11				609,195				602,783				596,018
Total common stock outstanding			35,647,476				35,063,210				34,799,935				28,626,484				27,628,482
Minimum number of shares issuable under purchase contracts (1)			2,883,892				2,984,367				3,215,538				4,198,425				5,101,326
Total common stock outstanding and shares issuable under purchase contracts			38,531,368				38,047,577				38,015,473				32,824,909				32,729,808
(1)    Purchase contracts relating to the tangible equity units
Tangible common equity per common stock		$	10.93			$	10.81			$	10.53			$	11.33			$	11.44
Book value per common stock		$	12.43			$	12.39			$	12.17			$	12.81			$	13.00
Tangible equity per common stock and shares issuable under purchase contracts		$	10.11			$	9.96			$	9.64			$	9.88			$	9.66
Book value per common stock and shares issuable under purchase contracts		$	11.50			$	11.41			$	11.14			$	11.18			$	10.98

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Banc of California, Inc

Non-GAAP Measures, Continued

(Dollars in thousands, except per share data)

(Unaudited)

		Three Months Ended																				Six Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,				June 30,				June 30,
		2015				2015				2014				2014				2014				2015				2014
Return on tangible common equity
Average total stockholders’ equity		$	630,547			$	517,335			$	487,578			$	449,392			$	385,098			$	574,254			$	357,511
Less average preferred stock			(182,233	)			(79,877	)			(79,877	)			(79,877	)			(79,877	)			(131,338	)			(79,877	)
Less average goodwill			(31,591	)			(31,591	)			(33,129	)			(32,209	)			(33,020	)			(31,591	)			(31,978	)
Less average other intangible assets			(23,032	)			(24,720	)			(13,611	)			(10,634	)			(10,871	)			(23,871	)			(11,349	)
Average tangible common equity		$	393,691			$	381,147			$	360,961			$	326,672			$	261,330			$	387,454			$	234,307
Net income		$	15,924			$	12,574			$	10,110			$	11,247			$	8,099			$	28,498			$	8,848
Less preferred stock dividends			(2,843	)			(910	)			(910	)			(910	)			(910	)			(3,753	)			(1,820	)
Add tax-effected amortization of intangible assets (1)			1,004				1,004				849				579				614				2,008				1,224
Add tax-effected impairment on intangible assets (1)			168				—				31				—				—				168				—
Net income available to common stockholders		$	14,253			$	12,668			$	10,080			$	10,916			$	7,803			$	26,921			$	8,252
(1)    Utilized a 35% effective tax rate
Return on average equity			10.13	%			9.86	%			8.23	%			9.93	%			8.44	%			10.01	%			4.99	%
Return on average tangible common equity			14.52	%			13.48	%			11.08	%			13.26	%			11.98	%			14.01	%			7.10	%

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