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Dec 31, 2020
Banc of California Q4 2020 Earnings Report
Reported net income of $21.7 million and diluted earnings per common share of $0.35.
Key Takeaways
Banc of California reported a strong fourth quarter in 2020, with significant growth in pre-tax pre-provision income, net income, and earnings per share, driven by lowering deposit costs, controlling noninterest expense, and increasing quality earning assets, resulting in a return on average assets of over 1.0%.
Return on average assets was 1.11%.
Net interest margin increased to 3.38%, a 29 basis points increase from the prior quarter.
Average cost of total deposits decreased to 0.36%, a 15 basis points decrease from the prior quarter.
Non-performing loans decreased 45% to $36.6 million, representing 0.62% of total loans.
Forward Guidance
While the operating environment remains uncertain as Banc of California begins 2021, the company is confident in its ability to continue executing well on strategies that drive earnings growth and franchise value, expecting to generate balance sheet growth while protecting net interest margin and managing expenses to improve operating leverage.
Positive Outlook
- Ability to continue to execute well on the strategies that are driving earnings growth and franchise value.
- Generate balance sheet growth.
- Protect net interest margin.
- Manage expenses.
- Improve operating leverage over the course of 2021.
Challenges Ahead
- Operating environment remains uncertain as we begin 2021.
- The foreseeable future continues to be uncertain with respect to the rollout of the approved vaccines for COVID-19.
- Lack of clarity regarding the impact of the most recent government stimulus.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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