STOCK TITAN
  1. Home
  2. Sec-filings
  3. BANC
  4. [8-K] BANC OF CALIFORNIA, INC. Reports Material Event

Banc of California (NYSE: BANC) takes $251M hit to reposition

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Banc of California reported second-quarter 2026 results dominated by a strategic balance sheet repositioning that produced a large accounting loss but is designed to raise future earnings. The bank sold $2.3 billion of lower-yielding securities, initiated the sale of $827.0 million of select commercial real estate and multi-family construction loans, and retired $385.0 million of subordinated debt ahead of a higher rate reset.

These moves drove a net loss available to common and equivalent stockholders of $251.3 million, or $(1.61) per diluted share, including a $256.7 million pre-tax loss on securities and a $161.8 million provision for credit losses tied largely to loans transferred to held for sale. Net interest income was $250.5 million and net interest margin was 3.13%, down from 3.24% in the prior quarter.

Core franchise metrics remained resilient: average loans grew 2.3% quarter over quarter, total deposits rose to $28.1 billion, and the loan‑to‑deposit ratio was 89.3%. Credit quality indicators improved, with total delinquent loans falling to 0.72% of loans held for investment and classified and special mention loans declining as a share of the portfolio. The allowance for credit losses on loans was 1.14% of loans and leases, and the holding company reported a 9.25% common equity tier 1 capital ratio. Management expects net interest margin to increase to about 3.30% after the targeted loan sale closes and has outlined 2026 year-end targets including NIM of 3.30–3.40% and return on average tangible common equity of 11.5–12.5%.

Positive

  • $2.3 billion securities repositioning and retirement of $385.0 million subordinated debt are expected to lift net interest margin to about 3.30%+ and support higher recurring earnings.
  • Credit quality improved as total delinquent loans fell to 0.72% of loans held for investment and classified and special mention loans declined by 99 and 154 basis points, respectively.

Negative

  • The company recorded a net loss available to common stockholders of $251.3 million, or $(1.61) per diluted share, compared with net earnings of $62.0 million in the prior quarter.
  • Strategic actions generated a $256.7 million pre-tax loss on securities and a $161.8 million provision for credit losses, with annualized net charge-offs rising to 2.54% of average loans and leases.

Filing Explained

At June 30, available liquidity was $14.1 billion, while the $827.0 million loan sale remained pending third-quarter closing.

The July 29 Form 8-K places the three balance-sheet actions at different stages: the $2.3 billion securities repositioning and $385.0 million subordinated-debt retirement were completed, while the $827.0 million targeted loan sale has signed purchase-and-sale agreements but is expected to close in the third quarter.

That leaves the loan transaction in a pre-closing state: as of June 30, 2026, $915.2 million was classified as held for sale, while $24.2 billion remained held for investment.

The securities action was partly completed: $1.7 billion had been reinvested by June 30, 2026, with the remaining proceeds expected to be invested in the third quarter.

As of June 30, 2026, the company reported $2.6 billion of immediately available cash, $7.9 billion of borrowing capacity and $3.6 billion of unpledged available-for-sale securities, for total available liquidity of $14.1 billion.

The preliminary common equity tier 1 ratio was 9.25%; the company expects it to reach approximately 9.50%–9.60% in the third quarter after the targeted loan sale closes.

The specified milestones to monitor are the third-quarter loan-sale closing and completion of the remaining securities reinvestment, which the filing links to expected net interest margin of at least 3.30%.

Item 2.02 Results of Operations and Financial Condition Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 7.01 Regulation FD Disclosure Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Net loss to common stockholders $251.3 million Net (loss) earnings available to common and equivalent stockholders for quarter ended June 30, 2026
Diluted (loss) earnings per share $(1.61) per share Quarter ended June 30, 2026
Securities repositioning size $2.3 billion Lower-yielding securities sold and repositioned during the second quarter of 2026
Pre-tax loss on securities AFS $256.7 million Loss recognized as part of the securities repositioning in Q2 2026
Provision for credit losses $161.8 million Provision for credit losses in the second quarter of 2026
Net interest margin 3.13% Net interest margin for quarter ended June 30, 2026
Total deposits $28.1 billion Total deposits at June 30, 2026
Common equity tier 1 capital ratio 9.25% Holding company CET1 ratio at June 30, 2026
held-to-maturity financial
"reclassified its entire held-to-maturity ("HTM") securities portfolio with an aggregate amortized"
A held-to-maturity asset is a debt investment a company plans and is able to keep until the loan or bond reaches its scheduled end, when the principal is repaid. For investors, this classification matters because the holder treats the investment like a locked-in loan—avoiding short-term price swings in financial statements and signaling a steady income expectation, similar to lending money to a friend with a fixed repayment date.
available-for-sale financial
"transferred $2.3 billion of lower-yielding held-to-maturity securities to available-for-sale, and"
A classification for bonds, stocks or other investments that a company plans to keep but might sell before they reach full term. Think of it like items a shop keeps on a shelf for potential sale: their market value can go up or down while the company holds them, and those unrealized gains or losses are shown separately from operating profit until they are sold. Investors watch this because large swings can change a company’s reported net worth and signal how much flexibility it has to raise cash quickly.
credit-linked notes financial
"$105.0 million of loss coverage from the credit-linked notes, pursuant to which the bank"
tangible book value per share financial
"$18.38 Book Value Per Share $16.44 Tangible Book Value Per Share (1)"
Tangible book value per share is the company's total physical and financial assets minus its liabilities and intangible items (like goodwill and brand value), divided by the number of outstanding shares. It gives investors a conservative, per‑share estimate of what would remain if the business sold only its hard assets and paid its debts—useful for judging whether a stock is priced above or below its underlying, tangible worth, like valuing a property by its bricks and cash rather than its reputation.
economic coverage ratio financial
"We refer to this adjusted ACL ratio as our economic coverage ratio(1), which equaled 1.63%"
nonperforming assets financial
"Total nonperforming assets ("NPAs") | $ 220,031 | | $ 203,789 | | $ 176,283"
Nonperforming assets are loans or investments that are not generating expected payments or returns because the borrower has fallen behind on payments or the investment has lost value. They matter to investors because a high level of nonperforming assets can indicate financial trouble for a bank or institution, potentially affecting its stability and profitability.
Net (loss) earnings available to common and equivalent stockholders $251.3 million loss Down from net earnings of $62.0 million in first quarter 2026 and $18.4 million in second quarter 2025.
Diluted (loss) earnings per share $(1.61) Down from $0.39 in first quarter 2026 and $0.12 in second quarter 2025.
Net interest income $250.5 million Slightly below $251.6 million in first quarter 2026 and above $240.2 million in second quarter 2025.
Net interest margin 3.13% Decreased from 3.24% in first quarter 2026 and increased from 3.10% in second quarter 2025.
Total deposits $28.1 billion Up from $27.3 billion at March 31, 2026 and $27.5 billion at June 30, 2025.
Common equity tier 1 capital ratio 9.25% Down from 10.18% at March 31, 2026 and 9.95% at June 30, 2025; company expects about 9.50–9.60% after loan sale closing.
Guidance

The company targets 2026 year-end net interest margin of 3.30–3.40%, return on average assets of 0.95–1.00%, return on average tangible common equity of 11.5–12.5%, and fourth quarter 2026 pre-tax pre-provision income of $125–$130 million.

AI-generated analysis. How Rhea-AI works. Not financial advice.

See more from StockTitan in Google Search and AI answers. Adds StockTitan as a preferred source · opens Google
Add on Google
Understanding 8-K Material Events →

FAQ

What were Banc of California (BANC)'s key Q2 2026 earnings results?
Banc of California reported a net loss available to common stockholders of $251.3 million, or $(1.61) per diluted share. Results were driven by a $256.7 million pre-tax securities loss and a $161.8 million credit loss provision tied to strategic balance sheet actions.

What strategic balance sheet actions did Banc of California (BANC) take in Q2 2026?
The company executed three actions: repositioned $2.3 billion of low-yield securities, initiated sale of $827.0 million of select CRE and construction loans, and retired $385.0 million of subordinated debt before a higher rate reset, aiming to boost long-term earnings and capital efficiency.

How did net interest margin and loan growth trend for Banc of California (BANC) in Q2 2026?
Net interest margin was 3.13%, down from 3.24% in Q1 2026, with management expecting about 3.30% after the targeted loan sale closes. Average loans rose $556.1 million, or 2.3% sequentially, on $2.8 billion of production at a 6.39% average rate.

What is Banc of California (BANC)'s capital position following its Q2 2026 repositioning?
At June 30, 2026, the holding company reported a 9.25% CET1 ratio and 11.67% Tier 1 capital ratio, both above well-capitalized thresholds. Management expects CET1 to be about 9.50–9.60% after the loan sale closes and to exceed 10.0% in early 2027.

How did credit quality at Banc of California (BANC) change in Q2 2026?
Total delinquent loans declined to $173.7 million, or 0.72% of loans held for investment, from 1.39% in Q1 2026. Classified and special mention loans as a percentage of loans fell by 99 and 154 basis points, while the allowance for credit losses reached 1.14% of loans and leases.

What 2026 profitability guidance did Banc of California (BANC) provide?
The company targets year-end net interest margin of 3.30–3.40%, ROAA of 0.95–1.00%, and ROATCE of 11.5–12.5%, with fourth-quarter 2026 pre-tax pre-provision income of $125–$130 million, reflecting expected benefits from its balance sheet repositioning.
0001169770false00011697702026-07-292026-07-290001169770us-gaap:CommonStockMember2026-07-292026-07-290001169770us-gaap:SeriesFPreferredStockMember2026-07-292026-07-29
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): July 29, 2026
 
BANC OF CALIFORNIA, INC.
(Exact name of registrant as specified in its charter)
 
Maryland
001-35522
04-3639825
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
   
11611 San Vicente Boulevard, Suite 500, Los Angeles,  California 90049
(Address of principal executive offices)(Zip Code)
 
Registrant’s telephone number, including area code: (855) 361-2262
 
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2.):
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which
registered
Common Stock, par value $0.01 per share
 
BANC
 
New York Stock Exchange
Depositary Shares, each representing a 1/40th interest in a share of 7.75% fixed rate
reset non-cumulative perpetual preferred stock, Series F
 
BANC/PF
 
New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of
this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company  ☐
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with
any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐
Item 2.02. Results of Operations and Financial Conditions.
On July 29, 2026, Banc of California, Inc. (the “Company”) issued a press release announcing financial results for
the second quarter ended June 30, 2026.
A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated by reference herein.
Item 7.01 Regulation FD Disclosure.
The Company will host a conference call to discuss its second quarter 2026 results at 08:00 A.M. Pacific Time on
Wednesday, July 29, 2026. Interested parties may attend the conference call by dialing (888) 317-6003 and
referencing event code 9364475. A live audio webcast will be available through the webcast link to be posted on the
Company’s Investor Relations website at www.bancofcal.com/investor, in addition to the slide presentation for
investor review prior to the call. A copy of the presentation materials is furnished herewith as Exhibit 99.2 and is
incorporated by reference herein.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
99.1Banc of California, Inc. Press Release dated July 29, 2026
99.2Banc of California, Inc. Earnings Conference Call Presentation Materials
104  Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
BANC OF CALIFORNIA, INC.
/s/ Joseph Kauder
Joseph Kauder
Executive Vice President and
Chief Financial Officer
Date: July 29, 2026
                                              1
jpega.jpg
bannerertemplate5282026a.jpg
Second Quarter 2026 Results
Press Release
             
Banc of California, Inc. Reports Second Quarter 2026 Financial Results and Announces Strategic Balance Sheet
Repositioning to Enhance Long-Term Earnings
Company Release – 7/29/2026
Quarter Results
9%
Loan Average
Annualized Growth
12%
Deposit Annualized
Growth
$2.3 billion
Securities Repositioning
$18.38
Book Value Per Share
$16.44
Tangible Book Value
Per Share(1)
$(1.61)
Loss Per Share
LOS ANGELES, Calif.--(BUSINESS WIRE)--Banc of California, Inc. (NYSE: BANC) (“Banc of California” or the “Company”), the
parent company of wholly-owned subsidiary Banc of California (the “Bank”), today reported financial results for the second quarter ended
June 30, 2026.
During the second quarter, the Company completed a strategic reallocation of capital toward higher return opportunities to further
strengthen long-term earnings, expand net interest margin, and increase balance sheet flexibility. The Company took three specific actions
including (i) the repositioning of $2.3 billion of lower-yielding securities, (ii) initiating the sale of $827.0 million of selected commercial
real estate and multi-family construction loans, and (iii) the retirement of $385.0 million of subordinated debt prior to higher contractual
interest reset.
The Company transferred $2.3 billion of lower-yielding held-to-maturity securities to available-for-sale, and subsequently sold and
redeployed a portion of the proceeds into higher-yielding, shorter-duration available-for-sale securities. The securities repositioning
generated a 276 basis point yield pickup on redeployed balances, reduced portfolio duration, and improved the risk-weighted asset profile
of the securities portfolio, all while maintaining capital ratios significantly above “well capitalized” regulatory thresholds.
The Company also commenced a targeted sale process of $827.0 million of commercial real estate and multi-family construction loans to
reduce selected credit exposures and lower the potential for future credit-related earnings volatility. Following a competitive loan sale
process, the Company has entered into purchase and sale agreements for the loans transferred to held-for-sale during the quarter and
expects the transactions to close in the third quarter. In addition, the Company retired $385.0 million of subordinated debt prior to a
significantly higher interest rate reset. Taken together, these actions are expected to immediately improve net interest margin, support
higher recurring earnings, and accelerate organic capital generation.
The Company reported a net loss available to common and equivalent stockholders of $251.3 million, or $(1.61) per diluted common
share, reflecting the near-term impact of these strategic actions.
Jared Wolff, Chairman & CEO of Banc of California, commented, “During the second quarter, we made a strategic decision to reallocate
capital toward opportunities that we believe will enhance long-term returns for our shareholders. We implemented that strategy through
three complementary actions including a securities repositioning, a targeted loan sale and the retirement of higher-cost subordinated debt,
that together create a more efficient balance sheet and position the Company for even stronger long-term financial performance."
Mr. Wolff continued, "These actions resulted in significant one-time charges, but they increase our long-term earnings power, improve
capital efficiency and provide greater financial flexibility to support future growth. Just as importantly, they allow us to focus our capital
on the businesses, clients and markets where we see the greatest opportunities to create shareholder value.”
(1) Non-GAAP measure; refer to section 'Non-GAAP Measures'
                                              2
jpega.jpg
image_28a.jpg
Second Quarter 2026 Financial Highlights:
•Executed a securities repositioning to drive higher recurring earnings power, including the sale of $2.3 billion of lower-yielding
securities and partial redeployment of $1.7 billion into higher-yielding shorter-duration securities, with the remaining proceeds
expected to be invested in the third quarter of 2026. The repositioning generated a 276 basis point yield pickup on redeployed balances
and resulted in a $256.7 million pre-tax loss on securities.
•Commenced a targeted loan sale process involving $827.0 million of loans to reduce selected exposures, enhance capital efficiency,
and improve the risk profile of the loan portfolio. Total provision expense of $161.8 million includes the impact of transferring these
loans to held for sale at the lower of cost or market value.
•Retired $385.0 million of subordinated debt prior to a significantly higher interest rate reset, reducing future funding costs and
supporting stronger pre-tax pre-provision earnings.
•Average loans increased $556.1 million, or 2.3%, during the quarter, driven by $2.8 billion of loan production and
disbursements with a weighted average interest rate on production of 6.39%.
•Total deposits increased $799.0 million, or 2.9% during the quarter, with average noninterest-bearing deposits comprising
28.5% of average total deposits.
•Loan-to-deposit ratio decreased 235 basis points to 89.3%.
•Credit quality trends were favorable, as classified loans and leases and special mention loans and leases as a percentage of total
loans and leases held for investment declined by 99 basis points, and 154 basis points, respectively.
•Capital ratios(1) exceeded the regulatory thresholds for "well capitalized" banks, including an estimated 11.67% Tier 1 capital
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
loan sale and to approximately 9.50-9.60% at the end of the third quarter.
•Book value per share and tangible book value per share(2) were $18.38 and $16.44, respectively, reflecting the near-term impact of
the strategic balance sheet repositioning actions completed during the quarter.
(1) Capital ratios for June 30, 2026 are preliminary
(2) Non-GAAP measure; refer to section 'Non-GAAP Measures'
                                              3
jpega.jpg
image_28a.jpg
INCOME STATEMENT HIGHLIGHTS
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
Summary Income Statement
2026
2026
2025
2026
2025
(In thousands)
Total interest income
$414,596
$407,442
$420,509
$822,038
$827,164
Total interest expense
164,095
155,825
180,293
319,920
354,584
Net interest income
250,501
251,617
240,216
502,118
472,580
Provision for credit losses
161,780
9,800
39,100
171,580
48,400
(Loss) gain on loans and leases HFS
(12,544)
10
21
(12,534)
232
Loss on securities AFS
(256,749)
—
—
(256,749)
—
Other noninterest income
35,197
35,318
32,612
70,515
66,051
Total noninterest (loss) income
(234,096)
35,328
32,633
(198,768)
66,283
Total revenue
16,405
286,945
272,849
303,350
538,863
Total noninterest expense
189,867
181,391
185,869
371,258
369,522
(Loss) earnings before income taxes
(335,242)
95,754
47,880
(239,488)
120,941
Income tax (benefit) expense
(93,895)
23,802
19,495
(70,093)
38,988
Net (loss) earnings
(241,347)
71,952
28,385
(169,395)
81,953
Preferred stock dividends
9,947
9,947
9,947
19,894
19,894
Net (loss) earnings available to common
and equivalent stockholders
$(251,294)
$62,005
$18,438
$(189,289)
$62,059
Diluted (loss) earnings per share
$(1.61)
$0.39
$0.12
$(1.22)
$0.38
Net Interest Income and Margin
Second Quarter of 2026 Compared to First Quarter of 2026
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
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.
The increase in interest expense was due to a $4.0 million increase in interest expense on deposits, attributable to higher average balances,
and a $4.2 million increase in interest expense on our borrowings driven by higher average balances to fund loan growth and replace
subordinated debt funding, following the redemption of the 3.25% Fixed-to-Floating Rate Subordinated Notes due 2031 during the second
quarter. The increase in interest income was driven by a $10.4 million increase from higher average loan balances and an additional day in
the quarter, and a $2.3 million increase from investments and deposits in financial institutions driven by higher average balances as a result
of the securities repositioning. These increases were offset partially by a $4.6 million reduction primarily related to loans placed on
nonaccrual status.
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
loan sale, net interest margin is expected to increase to approximately 3.30%. The decrease was primarily driven by nonaccrual interest
impacts and an increase in short-term funding associated with strong loan growth and the redemption of subordinated debt, while core
deposit growth strengthened toward quarter-end, improving the Company's funding profile entering the third quarter. The average total
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
basis point decrease in the average cost of borrowings to 4.44%. The average yield on interest-earning assets decreased to 5.18% from
5.25%, as a result of a 11 basis point decrease in the average yield on loans and leases to 5.63%.
Average total deposits increased by $299.1 million, with a $323.5 million increase in average interest-bearing deposits, offset partially by a
$24.4 million decrease in average noninterest-bearing deposits. Average noninterest-bearing deposits represented 28.5% of average total
deposits in the second quarter, down from 28.9% in the first quarter.
                                              4
jpega.jpg
image_28a.jpg
Three Months Ended
Increase (Decrease)
June 30, 2026
March 31, 2026
QoQ
Summary
Interest
Average
Interest
Average
Average
Average Balance
Average
Income/
Yield/
Average
Income/
Yield/
Average
Yield/
and Yield/Cost Data
Balance
Expense
Cost
Balance
Expense
Cost
Balance
Cost
(Dollars in thousands)
Assets:
Loans and leases(1)
$25,266,712
$354,832
5.63%
$24,710,609
$349,943
5.74%
$556,103
(0.11)%
Investment securities
4,938,232
42,407
3.44%
5,018,002
41,873
3.38%
(79,770)
0.06%
Deposits in financial institutions
1,912,585
17,357
3.64%
1,742,657
15,626
3.64%
169,928
—%
Total interest-earning assets
$32,117,529
$414,596
5.18%
$31,471,268
$407,442
5.25%
$646,261
(0.07)%
Liabilities:
Noninterest-bearing demand deposits
$7,866,139
$7,890,489
$(24,350)
Total interest-bearing deposits
19,752,609
$124,270
2.52%
19,429,112
$120,233
2.51%
323,497
0.01%
Total deposits
$27,618,748
124,270
1.80%
$27,319,601
120,233
1.78%
$299,147
0.02%
Total interest-bearing liabilities
$22,851,314
$164,095
2.88%
$22,148,512
$155,825
2.85%
$702,802
0.03%
Net interest income(1)
$250,501
$251,617
Net interest margin
3.13%
3.24%
(0.11)%
Total funds(2)
$30,717,453
$164,095
2.14%
$30,039,001
$155,825
2.10%
$678,452
0.04%
______________
(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.
(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
divided by average total funds.
YTD June 30, 2026 vs YTD June 30, 2025
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
months ended June 30, 2025. The increase was primarily driven by a $41.0 million decrease in interest expense on deposits primarily due
to lower interest rates following federal funds rate cuts, and an $8.8 million increase in interest income from investment securities
reflecting the benefits of prior balance sheet repositioning actions and reinvestment into higher-yielding assets. These benefits were offset
partially by a $10.3 million decrease in interest income from deposits in financial institutions due to lower balances and lower market
interest rates, a $6.3 million increase in borrowing costs associated with funding loan growth and the subordinated debt redemption in the
second quarter of 2026, and a $3.6 million decrease in loan interest income primarily attributable to a reversal of previously accrued
interest on loans placed on nonaccrual status, offset partially by the benefit of higher average loan balances.
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
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%,
offset partially by a 20 basis point decrease in the average yield on interest-earning assets to 5.21%.
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
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
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
$126.8 million increase in average interest-bearing deposits. Average noninterest-bearing deposits represented 28.7% of average total
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
decreased by 60 basis points to 4.52%, reflecting the paydown of higher-cost borrowings in the prior year and their replacement with
lower-cost long-term Federal Home Loan Bank ("FHLB") advances.
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
yield on loans and leases.
                                              5
jpega.jpg
image_28a.jpg
Six Months Ended
Increase (Decrease)
June 30, 2026
June 30, 2025
YoY
Summary
Interest
Average
Interest
Average
Average
Average Balance
Average
Income/
Yield/
Average
Income/
Yield/
Average
Yield/
and Yield/Cost Data
Balance
Expense
Cost
Balance
Expense
Cost
Balance
Cost
(Dollars in thousands)
Assets:
Loans and leases(1)
$24,990,197
$704,775
5.69%
$24,148,460
$708,406
5.92%
$841,737
(0.23)%
Investment securities
4,977,896
84,280
3.41%
4,726,957
75,478
3.22%
250,939
0.19%
Deposits in financial institutions
1,828,090
32,983
3.64%
1,979,843
43,280
4.41%
(151,753)
(0.77)%
Total interest-earning assets
$31,796,183
$822,038
5.21%
$30,855,260
$827,164
5.41%
$940,923
(0.20)%
Liabilities:
Noninterest-bearing demand
deposits
$7,878,247
$7,649,000
$229,247
Total interest-bearing deposits
19,591,754
$244,503
2.52%
19,464,984
$285,470
2.96%
126,770
(0.44)%
Total deposits
$27,470,001
244,503
1.79%
$27,113,984
285,470
2.12%
$356,017
(0.33)%
Total interest-bearing liabilities
$22,501,855
$319,920
2.87%
$21,923,564
$354,584
3.26%
$578,291
(0.39)%
Net interest income(1)
$502,118
$472,580
Net interest margin
3.18%
3.09%
0.09%
Total funds(2)
$30,380,102
$319,920
2.12%
$29,572,564
$354,584
2.42%
$807,538
(0.30)%
______________
(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
divided by average total funds.
Provision For Credit Losses
Second Quarter of 2026 Compared to First Quarter of 2026
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
primarily driven by $161.6 million of charge-offs, the impact of loan growth and higher loss given default rates on commercial real estate
and multi-family construction loans, offset partially by improved risk ratings for our held for investment ("HFI") portfolio. The increase in
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
targeted loan sale process. The transfer required the loans to be recorded at lower of cost or market value, resulting in charge-offs and
additional provision expense during the quarter.
The first quarter provision for loan losses and unfunded loan commitments was primarily driven by net charge off activity and changes in
loan risk ratings including specific reserves, offset partially by lower balances in the HFI portfolio and lower qualitative reserves.
YTD June 30, 2026 vs YTD June 30, 2025
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
ended June 30, 2025. The provision for 2026 included a provision for loan losses of $171.8 million, including the impact of the proposed
targeted loan sale process, offset by a $2.0 million reduction in provision for unfunded loan commitments.
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
the lower of cost or market value. The remaining increase in the provision for loan losses and unfunded loan commitments was primarily
driven by net charge-off activity experienced in the first half of the year, with additional impacts from changes in loan risk ratings, and
higher unfunded commitments. These were offset partially by lower qualitative reserves, lower specific reserves, and a favorable shift in
the portfolio mix due to growth in loan segments with lower expected credit losses.
                                              6
jpega.jpg
image_28a.jpg
Noninterest Income
Second Quarter of 2026 Compared to First Quarter of 2026
Noninterest income decreased by $269.4 million, resulting in a loss of $234.1 million for the second quarter, compared to noninterest
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
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
noninterest income was a $3.1 million loss related to the redemption of $385.0 million aggregate principal amount of subordinated notes
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
servicing rights portfolio, which serviced approximately $1.35 billion of underlying loans.
YTD June 30, 2026 vs YTD June 30, 2025
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
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
recognized as part of the securities repositioning, and a $12.5 million lower of cost or market adjustment on the HFS loans, as discussed
above.
Noninterest Expense
Second Quarter of 2026 Compared to First Quarter of 2026
Noninterest expense increased by $8.5 million to $189.9 million for the second quarter from $181.4 million for the first quarter, primarily
reflecting a $7.7 million increase in insurance and assessment due to a higher FDIC assessment rate resulting from the balance sheet
repositioning and its effect on assessment-related metrics and a $5.0 million increase in other expense related mainly to software
obsolescence charges. These increases were offset partially by a $6.0 million decrease in compensation expense due to seasonal payroll
related costs recognized in the first quarter.
YTD June 30, 2026 vs YTD June 30, 2025
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
months ended June 30, 2025. The increase is primarily due to a $6.3 million increase in other expense related mainly to software
obsolescence charges, a $4.6 million increase in insurance and assessment due to the higher assessment rate resulting from the balance
sheet repositioning, and a $2.5 million increase in loans expense related to legal fees. These increases were offset partially by a $6.5
million decrease in customer related expenses primarily due to federal fund rate cuts in the fourth quarter of 2025 and a $3.0 million
decrease in leased equipment depreciation.
Income Taxes
Second Quarter of 2026 Compared to First Quarter of 2026
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
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
Company's balance sheet repositioning actions. Due to the significant impact of these actions on projected annual earnings, the Company
calculated its second quarter income tax provision using a year to date effective tax rate approach rather than the estimated annual effective
tax rate method.
YTD June 30, 2026 vs YTD June 30, 2025
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%,
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
rate from 2025 to 2026 is due primarily to the impact of deferred tax asset revaluation recorded following the California state tax changes
passed as part of the 2025 California budget enacted on June 30, 2025.
                                              7
jpega.jpg
image_28a.jpg
BALANCE SHEET HIGHLIGHTS
June 30,
March 31,
June 30,
Increase (Decrease)
Selected Balance Sheet Items
2026
2026
2025
QoQ
YoY
(In thousands)
Cash and cash equivalents
$2,818,055
$2,217,269
$2,353,552
$600,786
$464,503
Securities available-for-sale
4,484,021
2,656,332
2,246,174
1,827,689
2,237,847
Securities held-to-maturity
—
2,313,548
2,316,725
(2,313,548)
(2,316,725)
Loans held for sale
915,171
259,049
465,571
656,122
449,600
Loans and leases held for investment
24,210,846
24,780,347
24,245,893
(569,501)
(35,047)
Total loans and leases
25,126,017
25,039,396
24,711,464
86,621
414,553
Total assets
35,030,953
34,724,241
34,250,453
306,712
780,500
Noninterest-bearing deposits
$7,758,119
$7,797,542
$7,441,116
$(39,423)
$317,003
Total deposits
28,121,182
27,322,134
27,528,433
799,048
592,749
Borrowings
2,460,363
2,551,250
1,917,180
(90,887)
543,183
Total liabilities
31,620,807
31,170,915
30,823,610
449,892
797,197
Total stockholders' equity
3,410,146
3,553,326
3,426,843
(143,180)
(16,697)
Securities
As part of the securities repositioning, the Company reclassified its entire held-to-maturity ("HTM") securities portfolio with an aggregate
amortized cost basis of $2.3 billion to available-for-sale ("AFS") securities and subsequently sold primarily all of the securities. The $2.3
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
improved the Company's earning-asset mix by facilitating the redeployment of proceeds into higher-yielding assets while enhancing
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
basis point yield pickup on redeployed balances.
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,
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
$2.3 billion, as part of the securities repositioning, $116.9 million of principal paydowns, $16.7 million of maturities, $8.2 million decrease
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
after-tax losses in AOCI of $145.3 million, up from $143.3 million at March 31, 2026, driven by higher interest rates.
As of June 30, 2026, there are no HTM securities.
                                              8
jpega.jpg
image_28a.jpg
Loans and Leases
The following table sets forth the composition, by loan category, of our loan and lease portfolio HFI as of the dates indicated:
June 30,
March 31,
December 31,
September 30,
June 30,
2026
2026
2025
2025
2025
(Dollars in thousands)
Composition of Loans and Leases
Real estate mortgage:
Commercial
$4,037,229
$4,093,386
$4,314,637
$4,292,625
$4,369,401
Multi-family
5,445,475
5,955,102
6,089,417
6,124,673
6,280,791
Other residential
3,793,876
3,458,410
3,346,733
3,162,564
3,157,616
Total real estate mortgage
13,276,580
13,506,898
13,750,787
13,579,862
13,807,808
Real estate construction and land:
Commercial
360,392
364,575
379,387
395,150
381,449
Residential
1,114,459
1,527,754
1,568,240
1,759,676
1,920,642
Total real estate construction and land
1,474,851
1,892,329
1,947,627
2,154,826
2,302,091
Total real estate
14,751,431
15,399,227
15,698,414
15,734,688
16,109,899
Commercial:
Asset-based
3,318,822
3,209,338
2,951,010
2,742,519
2,462,351
Venture capital
2,440,075
2,322,261
2,222,097
1,907,601
2,002,601
Other commercial
3,353,534
3,501,388
3,804,099
3,356,537
3,288,305
Total commercial
9,112,431
9,032,987
8,977,206
8,006,657
7,753,257
Consumer
346,984
348,133
357,059
369,297
382,737
Total loans and leases HFI
$24,210,846
$24,780,347
$25,032,679
$24,110,642
$24,245,893
Total unfunded loan commitments
$5,211,632
$5,549,325
$5,433,357
$4,822,917
$4,673,596
Composition as % of Total Loans and Leases
Real estate mortgage:
Commercial
17%
17%
17%
18%
18%
Multi-family
22%
24%
24%
25%
26%
Other residential
16%
14%
14%
13%
13%
Total real estate mortgage
55%
55%
55%
56%
57%
Real estate construction and land:
Commercial
1%
2%
2%
2%
1%
Residential
5%
6%
6%
7%
8%
Total real estate construction and land
6%
8%
8%
9%
9%
Total real estate
61%
63%
63%
65%
66%
Commercial:
Asset-based
14%
13%
12%
11%
10%
Venture capital
10%
9%
9%
8%
8%
Other commercial
14%
14%
15%
14%
14%
Total commercial
38%
36%
36%
33%
32%
Consumer
1%
1%
1%
2%
2%
Total loans and leases HFI
100%
100%
100%
100%
100%
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
part, the transfer of $827.0 million of loans to HFS in connection with the balance sheet repositioning, including $491.9 million of multi-
family loans, $300.6 million of multi-family construction loans, and $34.5 million of commercial real estate mortgage loans. Excluding the
impact of the loans transferred to HFS, the Company continued to generate loan growth in other residential real estate mortgage loans,
venture capital loans, and asset-based lending portfolios. Loan production and disbursements totaled $2.8 billion in the second quarter with
a weighted average interest rate on production of 6.39%.
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
was primarily driven by the Company's targeted loan sale process discussed above.
                                              9
jpega.jpg
image_28a.jpg
Credit Quality
June 30,
March 31,
December 31,
September 30,
June 30,
Asset Quality Information and Ratios
2026
2026
2025
2025
2025
(Dollars in thousands)
Delinquent loans and leases held for investment:
30 to 89 days delinquent
$91,196
$263,530
$108,303
$56,416
$53,900
90+ days delinquent
82,457
81,599
92,655
104,952
95,566
Total delinquent loans and leases
$173,653
$345,129
$200,958
$161,368
$149,466
Total delinquent loans and leases to loans and leases HFI
0.72%
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
$167,516
90+ days delinquent loans and still accruing
—
—
—
—
—
Total nonperforming loans and leases ("NPLs")
203,712
185,734
159,168
174,541
167,516
Foreclosed assets, net
16,319
18,055
17,115
4,790
7,806
Total nonperforming assets ("NPAs")
$220,031
$203,789
$176,283
$179,331
$175,322
Classified loans and leases HFI
$582,790
$842,834
$800,330
$763,582
$656,556
Special mention loans and leases HFI
300,542
688,659
458,683
505,979
661,568
Criticized loans and leases HFI
$883,332
$1,531,493
$1,259,013
$1,269,561
$1,318,124
Allowance for loan and lease losses
$243,319
$241,600
$245,612
$240,501
$229,344
Allowance for loan and lease losses to NPLs
119.44%
130.08%
154.31%
137.79%
136.91%
NPLs to loans and leases HFI
0.84%
0.75%
0.64%
0.72%
0.69%
NPAs to total assets
0.63%
0.59%
0.51%
0.53%
0.51%
Classified loans and leases to loans and leases HFI
2.41%
3.40%
3.20%
3.17%
2.71%
Special mention loans and leases to loans and leases HFI
1.24%
2.78%
1.83%
2.10%
2.73%
Credit quality metrics improved from the first quarter, primarily reflecting the transfer of certain loans to HFS as part of the balance sheet
repositioning. Nonperforming, classified, and special mention loans and leases as a percentage of total loans held for investment increased
9 basis points, and decreased 99 basis points and 154 basis points, respectively.
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
delinquent category decreased by $140.7 million in residential real estate construction and land loans, $32.9 million in commercial real
estate construction and land loans, and $32.8 million in multi-family real estate mortgage loans, offset partially by increases of $27.9
million in other residential real estate mortgage loans. In the 90 or more days delinquent category, there were increases of $11.8 million in
other commercial loans and $9.1 million in multi-family real estate mortgage loans, offset partially by decreases of $23.2 million in
commercial real estate loans.
At June 30, 2026, nonperforming loans and leases were $203.7 million, compared to $185.7 million at March 31, 2026. During the second
quarter, nonperforming loans and leases increased by $18.0 million due to additions of $391.7 million, offset partially by transfers to loans
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.
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,
as of March 31, 2026. At June 30, 2026, nonperforming assets included $16.3 million of foreclosed assets, consisting primarily of single-
family residences.
                                              10
jpega.jpg
image_28a.jpg
Allowance for Credit Losses – Loans
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
Allowance for Credit Losses - Loans
2026
2026
2025
2026
2025
(Dollars in thousands)
Allowance for loan and lease losses ("ALLL"):
Balance at beginning of period
$241,600
$245,612
$234,986
$245,612
$239,360
Charge-offs
(161,617)
(16,097)
(46,948)
(177,714)
(63,499)
Recoveries
1,336
2,285
2,726
3,621
5,203
Net charge-offs
(160,281)
(13,812)
(44,222)
(174,093)
(58,296)
Provision for loan losses
162,000
9,800
38,580
171,800
48,280
Balance at end of period
$243,319
$241,600
$229,344
$243,319
$229,344
Reserve for unfunded loan commitments ("RUC"):
Balance at beginning of period
$34,921
$34,921
$29,571
$34,921
$29,071
Provision for credit losses
(2,000)
—
(350)
(2,000)
150
Balance at end of period
$32,921
$34,921
$29,221
$32,921
$29,221
Allowance for credit losses ("ACL") - Loans:
Balance at beginning of period
$276,521
$280,533
$264,557
$280,533
$268,431
Charge-offs
(161,617)
(16,097)
(46,948)
(177,714)
(63,499)
Recoveries
1,336
2,285
2,726
3,621
5,203
Net charge-offs
(160,281)
(13,812)
(44,222)
(174,093)
(58,296)
Provision for credit losses
160,000
9,800
38,230
169,800
48,430
Balance at end of period
$276,240
$276,521
$258,565
$276,240
$258,565
ALLL to loans and leases HFI
1.00%
0.97%
0.95%
1.00%
0.95%
ACL to loans and leases HFI
1.14%
1.12%
1.07%
1.14%
1.07%
ACL to NPLs
135.60%
148.88%
154.35%
135.60%
154.35%
ACL to NPAs
125.55%
135.69%
147.48%
125.55%
147.48%
Annualized net charge-offs to average loans and leases
2.54%
0.23%
0.72%
1.40%
0.49%
The allowance for credit losses - loans, which includes the reserve for unfunded loan commitments, totaled $276.2 million, or 1.14% of
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
decrease in the allowance was driven by net charge-offs of $160.3 million, largely associated with loans transferred to HFS during the
quarter, offset partially by the provision of $160.0 million.
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
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
marks of $12.9 million on approximately $1.2 billion of purchased loans without credit deterioration. When the loss coverage from the
credit-linked notes and unearned credit marks is added to our allowance for credit losses, this provides additional economic coverage on
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
at June 30, 2026 compared to 1.60% at March 31, 2026.
The ACL coverage of nonperforming loans and leases was 136% at June 30, 2026 compared to 149% at March 31, 2026.
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
first quarter.
(1) Non-GAAP measure; refer to section 'Non-GAAP Measures'
                                              11
jpega.jpg
image_28a.jpg
Deposits and Client Investment Funds
The following table sets forth the composition of our deposits at the dates indicated:
June 30,
March 31,
December 31,
September 30,
June 30,
2026
2026
2025
2025
2025
(Dollars in thousands)
Composition of Deposits
Noninterest-bearing checking
$7,758,119
$7,797,542
$7,822,787
$7,603,748
$7,441,116
Interest-bearing:
Checking
8,739,368
8,178,485
8,509,587
7,930,951
7,974,452
Money market
5,136,561
4,643,349
4,917,857
4,974,177
5,375,080
Savings
1,834,517
1,991,010
1,905,863
1,949,369
1,932,906
Time deposits:
Non-brokered
2,061,323
2,149,564
2,254,293
2,468,017
2,492,890
Brokered
2,591,294
2,562,184
2,432,970
2,258,503
2,311,989
Total time deposits
4,652,617
4,711,748
4,687,263
4,726,520
4,804,879
Total interest-bearing
20,363,063
19,524,592
20,020,570
19,581,017
20,087,317
Total deposits
$28,121,182
$27,322,134
$27,843,357
$27,184,765
$27,528,433
Composition as % of
Total Deposits
Noninterest-bearing checking
28%
29%
28%
28%
27%
Interest-bearing:
Checking
31%
30%
30%
29%
29%
Money market
18%
17%
18%
19%
20%
Savings
7%
7%
7%
7%
7%
Time deposits:
Non-brokered
7%
8%
8%
9%
9%
Brokered
9%
9%
9%
8%
8%
Total time deposits
16%
17%
17%
17%
17%
Total interest-bearing
72%
71%
72%
72%
73%
Total deposits
100%
100%
100%
100%
100%
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
interest-bearing deposits of $838.5 million and a decrease in noninterest-bearing deposits of $39.4 million. Interest-bearing deposits
increased due mainly to higher balances in checking accounts of $560.9 million and higher money market accounts of $493.2 million,
offset partially by lower savings accounts of $156.5 million and lower brokered and non-brokered time deposits of $59.1 million.
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
total deposits, at March 31, 2026.
At June 30, 2026, uninsured and uncollateralized deposits totaled $7.6 billion, or 27% of total deposits, compared to $7.8 billion, or 28%
of total deposits, at March 31, 2026.
In addition to deposit products, we also offer alternative, non-depository corporate treasury solutions for select clients to invest excess
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.
Borrowings
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
repayment of a long-term FHLB advance.
Subordinated Debt
On May 1, 2026, the Company redeemed all $385 million outstanding aggregate principal amount of its 3.25% Fixed-to-Floating Rate
Subordinated Notes due 2031 originally issued by Pacific Western Bank. The remaining unamortized discount and debt issuance costs
were recorded as a loss on redemption of subordinated notes in noninterest income. As a result of the redemption, subordinated debt
decreased to $573.6 million at June 30, 2026, from $954.1 million at March 31, 2026.
                                              12
jpega.jpg
image_28a.jpg
Equity
During the second quarter, total stockholders’ equity decreased by $143.2 million to $3.4 billion and tangible common equity(1) decreased
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
net losses of $241.3 million and common and preferred stock dividends of $29.3 million, offset partially by a decrease in the unrealized
after-tax net loss in AOCI for AFS and HTM securities of $125.3 million.
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
common share(1) decreased to $16.44 compared to $17.77 at March 31, 2026. The decrease primarily reflected the repositioning actions
completed during the quarter.
For the six-month period ended June 30, 2026, the Company repurchased 1,709,935 shares of common and common equivalent stock at a
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
the current stock repurchase authorization, which expires in March 2027.
(1) Non-GAAP measure; refer to section 'Non-GAAP Measures'
CAPITAL AND LIQUIDITY
The following table sets forth our regulatory capital ratios as of the dates indicated:
June 30,
March 31,
December 31,
September 30,
June 30,
2026
2026
2025
2025
2025
Capital Ratios(1)
Banc of California, Inc.
Total risk-based capital ratio
14.31%
16.55%
16.31%
16.69%
16.37%
Tier 1 risk-based capital ratio
11.67%
12.54%
12.34%
12.56%
12.34%
Common equity tier 1 capital ratio
9.25%
10.18%
10.01%
10.14%
9.95%
Tier 1 leverage ratio
8.89%
9.97%
9.99%
9.77%
9.74%
Banc of California
Total risk-based capital ratio
13.74%
15.97%
15.61%
15.94%
15.65%
Tier 1 risk-based capital ratio
12.68%
13.50%
13.15%
13.42%
13.21%
Common equity tier 1 capital ratio
12.68%
13.50%
13.15%
13.42%
13.21%
Tier 1 leverage ratio
9.64%
10.73%
10.65%
10.44%
10.42%
______________
(1) June 30, 2026 capital ratios are preliminary.
At June 30, 2026, cash and cash equivalents totaled $2.8 billion, up $600.8 million from March 31, 2026.
Our immediately available cash and cash equivalents (excluding restricted cash) were $2.6 billion. Combined with total available
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
second quarter.
                                              13
jpega.jpg
image_28a.jpg
Conference Call
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,
July 29, 2026. Interested parties are welcome to attend the conference call by dialing (888) 317-6003 and referencing event code 9364475.
A live audio webcast will also be available, and the webcast link will be posted on the Company’s Investor Relations website at
www.bancofcal.com/investor. The slide presentation for the call will also be available on the Company's Investor Relations website prior
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
website at www.bancofcal.com/investor or by dialing (855) 669-9658 and referencing event code 7085829.
About Banc of California, Inc.
Banc of California, Inc. (NYSE: BANC) is a bank holding company with over $34 billion in assets and the parent company of Banc of
California. Banc of California is one of the nation’s premier relationship-based business banks, providing banking and treasury
management services to small, middle-market, and venture-backed businesses. Banc of California is the largest independent bank
headquartered in Los Angeles and the third largest bank headquartered in California and offers a broad range of loan and deposit products
and services through 77 full-service branches located throughout California and in Denver, Colorado, and Durham, North Carolina, as well
as through regional offices nationwide. The bank also provides full-service payment processing solutions to its clients and serves the
Community Association Management industry nationwide with its technology-forward platform, SmartStreet™. The bank is committed to
its local communities through the Banc of California Charitable Foundation, and by supporting organizations that provide financial literacy
and job training, small business support, affordable housing, and more. Member FDIC. For more information, please visit us
at www.bancofcal.com.
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 include, but are not limited to, statements related to our expectations regarding the
performance of our business, liquidity and capital ratios; the anticipated benefits of our strategic repositioning including, among others, a
strengthened credit profile, possible net interest income and net interest margin expansion and an enhanced earnings profile; and other non-
historical statements. Words or phrases such as “believe,” “will,” “should,” “will likely result,” “are expected to,” “will continue,” “is
anticipated,” “estimate,” “project,” “plans,” “strategy,” or similar expressions are intended to identify these forward-looking statements.
You are cautioned not to place undue reliance on any forward-looking statements. 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 the Company with the Securities and Exchange Commission ("SEC"). The Company
undertakes no obligation to revise or publicly release any revision or update to these forward-looking statements to reflect events or
circumstances that occur after the date on which such statements were made, except as required by law.
Factors that could cause actual results to differ materially from the results anticipated or projected include, but are not limited to: (i)
changes in general economic conditions, either nationally or in our market areas, including the impact of tariffs and retaliatory tariffs,
supply chain disruptions, and the risk of recession or an economic downturn; (ii) changes in the interest rate environment, including the
recent and potential future changes in the FRB benchmark rate, which could adversely affect our revenue and expenses, the value of assets
and obligations, the realization of deferred tax assets, the availability and cost of capital and liquidity, and the impacts of continuing or
renewed inflation; (iii) the credit risks of lending activities, which may be affected by deterioration in real estate markets and the financial
condition of borrowers, and the operational risk of lending activities, including the effectiveness of our underwriting practices and the risk
of fraud, any of which may lead to increased loan delinquencies, losses, and non-performing assets, and may result in our allowance for
credit losses not being adequate; (iv) fluctuations in the demand for loans, and fluctuations in commercial and residential real estate values
in our market area; (v) the quality and composition of our securities portfolio; (vi) our ability to develop and maintain a strong core deposit
base, including among our venture banking clients, or other low cost funding sources necessary to fund our activities particularly in a
rising or high interest rate environment; (vii) the rapid withdrawal of a significant amount of demand deposits over a short period of time;
(viii) our ability to achieve or maintain the anticipated benefits of our strategic repositioning due to one or more of the other factors
described herein or otherwise, or the failure to complete our anticipated loan sales due to a condition to closing not being satisfied or
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
Company’s acquisitions, including disruption to current plans and operations; difficulties in customer and employee retention; fees,
expenses and charges related to these transactions being significantly higher than anticipated; and our inability to achieve expected
revenues, cost savings, synergies, and other benefits; (xii) the competitive and other impacts on our business of emerging technologies,
including stablecoins and other digital currencies, tokenized deposits, blockchain, artificial intelligence, quantum computing, and related
innovations affecting both the Company and the banking industry; (xiii) results of examinations by regulatory authorities of the Company
and the possibility that any such regulatory authority may, among other things, limit our business activities, restrict our ability to invest in
certain assets, refrain from issuing an approval or non-objection to certain capital or other actions, increase our allowance for credit losses,
                                              14
jpega.jpg
image_28a.jpg
result in write-downs of asset values, restrict our ability or that of our bank subsidiary to pay dividends, or impose fines, penalties or
sanctions; (xiv) legislative or regulatory changes that adversely affect our business, including changes in tax laws and policies, accounting
policies and practices, privacy laws, and regulatory capital or other rules; (xv) the risk that our enterprise risk management framework may
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
and liabilities, as well as the value of collateral supporting our loans, which may result in significant changes in valuation or recoveries;
(xvii) cybersecurity threats and failures or security breaches with respect to the network, applications, vendors and computer systems on
which we depend; (xviii) our ability to attract and retain key members of our senior management team; (xix) the effects of climate change,
severe weather events, natural disasters such as earthquakes and wildfires, pandemics, epidemics and other public health crises, military
activity (including the ongoing Iran war) or acts of terrorism, and other external events on our business; (xx) the impact of bank failures or
other adverse developments at other banks on general depositor and investor sentiment regarding the stability and liquidity of banks; (xxi)
the possibility that our recorded goodwill could become impaired, which may have an adverse impact on our earnings and capital; (xxii)
our existing indebtedness, together with any future incurrence of additional indebtedness, could adversely affect our ability to raise
additional capital and to meet our debt obligations; (xxiii) changes in market conditions or strategic balance sheet actions, which may result
in realized losses on investment securities or other assets; (xxiv) the effects of any damage to our reputation resulting from developments
related to any of the items identified above; and (xxv) other economic, competitive, governmental, regulatory, and technological factors
affecting our operations, pricing, products and services and the other risks described in our Annual Report on Form 10-K for the fiscal year
ended December 31, 2025 and from time to time in other documents that we file with or furnish to the SEC.
Non-GAAP Financial Measures
Included in this press release are certain non-GAAP financial measures, such as tangible common equity, tangible book value per common
share, return on average tangible common equity, pre-tax pre-provision income, efficiency ratio, and economic coverage ratio, designed to
complement the financial information presented in accordance with U.S. GAAP because management believes such measures are useful to
investors. These non-GAAP financial measures should be considered only as supplemental to, and not superior to, financial measures
provided in accordance with GAAP. Please refer to the “Non-GAAP Measures” section of this release for additional detail including
reconciliations of the non-GAAP financial measures included in this press release to the most directly comparable financial measures
prepared in accordance with GAAP.
Investor Relations Inquiries:
Banc of California, Inc.
(855) 361-2262
Jared Wolff, (310) 424-1230
Joe Kauder, (310) 844-5224
Ann DeVries, (646) 376-7011
Media Contact:
Debora Vrana, Banc of California
(213) 533-3122
Deb.Vrana@bancofcal.com
                                              15
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(UNAUDITED)
June 30,
March 31,
December 31,
September 30,
June 30,
2026
2026
2025
2025
2025
ASSETS:
(Dollars in thousands)
Cash and due from banks
$225,343
$214,120
$181,103
$205,364
$222,210
Interest-earning deposits in financial institutions
2,592,712
2,003,149
2,126,862
2,192,901
2,131,342
Total cash and cash equivalents
2,818,055
2,217,269
2,307,965
2,398,265
2,353,552
Securities AFS
4,484,021
2,656,332
2,454,058
2,426,734
2,246,174
Securities HTM
—
2,313,548
2,308,636
2,303,657
2,316,725
FRB and FHLB stock
181,352
170,342
160,442
159,337
162,243
  Total investment securities
4,665,373
5,140,222
4,923,136
4,889,728
4,725,142
Loans HFS
915,171
259,049
182,936
211,454
465,571
Loans and leases HFI
24,210,846
24,780,347
25,032,679
24,110,642
24,245,893
Allowance for loan and lease losses
(243,319)
(241,600)
(245,612)
(240,501)
(229,344)
Total loans and leases HFI, net
23,967,527
24,538,747
24,787,067
23,870,141
24,016,549
Equipment leased to others under operating leases
218,444
223,558
238,232
280,872
288,692
Premises and equipment, net
145,440
146,316
146,698
132,766
138,032
Bank owned life insurance
348,777
352,707
350,083
348,051
346,142
Goodwill
214,521
214,521
214,521
214,521
214,521
Intangible assets, net
92,709
99,091
105,287
111,923
118,930
Deferred tax asset, net
704,467
653,481
656,755
672,159
691,535
Other assets
940,469
879,280
884,762
883,085
891,787
Total assets
$35,030,953
$34,724,241
$34,797,442
$34,012,965
$34,250,453
LIABILITIES:
Noninterest-bearing deposits
$7,758,119
$7,797,542
$7,822,787
$7,603,748
$7,441,116
Interest-bearing deposits
20,363,063
19,524,592
20,020,570
19,581,017
20,087,317
Total deposits
28,121,182
27,322,134
27,843,357
27,184,765
27,528,433
Borrowings
2,460,363
2,551,250
2,063,819
2,005,022
1,917,180
Subordinated debt
573,555
954,072
952,740
950,888
949,213
Accrued interest payable and other liabilities
465,707
343,459
396,249
405,551
428,784
Total liabilities
31,620,807
31,170,915
31,256,165
30,546,226
30,823,610
STOCKHOLDERS' EQUITY:
Preferred stock
498,516
498,516
498,516
498,516
498,516
Common stock
1,580
1,538
1,500
1,509
1,474
Class B non-voting common stock
5
5
5
5
5
Non-voting common stock equivalents
—
—
50
41
98
Additional paid-in-capital
3,485,560
3,501,213
3,552,483
3,563,145
3,609,109
Retained 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’ equity
3,410,146
3,553,326
3,541,277
3,466,739
3,426,843
Total liabilities and stockholders’ equity
$35,030,953
$34,724,241
$34,797,442
$34,012,965
$34,250,453
Common shares outstanding (1)
158,432,520
154,262,045
155,533,403
155,522,693
157,647,137
______________
(1) Common shares outstanding include non-voting common stock equivalents that are participating securities. There were no non‑voting common stock equivalents
outstanding as of June 30, 2026 and March 31, 2026.
                                              16
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
2026
2026
2025
2026
2025
(In thousands, except per share amounts)
Interest income:
Loans and leases
$354,832
$349,943
$362,303
$704,775
$708,406
Investment securities
42,407
41,873
37,616
84,280
75,478
Deposits in financial institutions
17,357
15,626
20,590
32,983
43,280
Total interest income
414,596
407,442
420,509
822,038
827,164
Interest expense:
Deposits
124,270
120,233
144,940
244,503
285,470
Borrowings
26,568
20,177
20,021
46,745
38,442
Subordinated debt
13,257
15,415
15,332
28,672
30,672
Total interest expense
164,095
155,825
180,293
319,920
354,584
Net interest income
250,501
251,617
240,216
502,118
472,580
Provision for credit losses
161,780
9,800
39,100
171,580
48,400
Net interest income after provision for credit losses
88,721
241,817
201,116
330,538
424,180
Noninterest income:
Service charges on deposit accounts
4,763
4,978
4,456
9,741
8,999
Commissions and fees
9,034
10,980
9,641
20,014
19,599
Leased equipment income
7,820
8,530
10,231
16,350
21,015
(Loss) gain on loans and leases HFS
(12,544)
10
21
(12,534)
232
Loss on securities AFS
(256,749)
—
—
(256,749)
—
Dividends and gains (loss) on equity investments
3,326
2,002
(114)
5,328
2,209
Warrant income
896
938
1,227
1,834
932
Other income
9,358
7,890
7,171
17,248
13,297
Total noninterest (loss) income 
(234,096)
35,328
32,633
(198,768)
66,283
Noninterest expense:
Compensation
85,120
91,100
88,362
176,220
174,779
Occupancy
14,714
14,892
15,473
29,606
30,483
Information technology and data processing
13,769
14,339
13,073
28,108
28,172
Other professional services
5,599
4,236
6,406
9,835
10,919
Insurance and assessments
14,500
6,764
9,403
21,264
16,686
Intangible asset amortization
6,349
6,348
7,159
12,697
14,319
Leased equipment depreciation
5,168
5,304
6,700
10,472
13,441
Customer related expense
24,114
23,737
26,577
47,851
54,328
Loan expense
5,170
4,292
4,050
9,462
6,980
Other expense
15,364
10,379
8,666
25,743
19,415
Total noninterest expense
189,867
181,391
185,869
371,258
369,522
(Loss) earnings before income taxes
(335,242)
95,754
47,880
(239,488)
120,941
Income tax (benefit) expense
(93,895)
23,802
19,495
(70,093)
38,988
Net (loss) earnings 
(241,347)
71,952
28,385
(169,395)
81,953
Preferred stock dividends
9,947
9,947
9,947
19,894
19,894
Net (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)
$0.38
Diluted
$(1.61)
$0.39
$0.12
$(1.22)
$0.38
Weighted average number of common shares outstanding: (1)
Basic
155,803
154,821
158,354
155,315
163,396
Diluted
155,803
160,832
158,462
155,315
163,667
______________
(1) Common shares outstanding include non-voting common stock equivalents that are participating securities.
                                              17
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
SELECTED FINANCIAL DATA
(UNAUDITED)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
Profitability and Other Ratios
2026
2026
2025
2026
2025
Return 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 ratio
89.30%
91.65%
89.77%
89.30%
89.77%
Average loans and leases to average deposits
91.48%
90.45%
89.74%
90.97%
89.06%
Average investment securities to average total assets
14.25%
14.76%
13.98%
14.50%
14.09%
Average stockholders' equity to average total assets
10.23%
10.44%
10.16%
10.33%
10.37%
______________
(1) Annualized.
(2) Non-GAAP measure.
(3) Ratio calculated by dividing dividends declared per common and equivalent share by basic (loss) earnings per common and equivalent share.
(4) Total revenue equals the sum of net interest income and noninterest income.
(5) Ratio calculated by dividing noninterest expense (less intangible asset amortization and acquisition, integration and reorganization costs) by total revenue (the sum of net                 
interest income and noninterest income, less gain (loss) on securities AFS) .
                                              18
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
AVERAGE BALANCE, AVERAGE YIELD EARNED, AND AVERAGE COST PAID
(UNAUDITED)
Three Months Ended
June 30, 2026
March 31, 2026
June 30, 2025
Interest
Average
Interest
Average
Interest
Average
Average
Income/
Yield/
Average
Income/
Yield/
Average
Income/
Yield/
Balance
Expense
Cost
Balance
Expense
Cost
Balance
Expense
Cost
(Dollars in thousands)
Assets:
Loans and leases (1)
$25,266,712
$354,832
5.63%
$24,710,609
$349,943
5.74%
$24,504,319
$362,303
5.93%
Investment securities
4,938,232
42,407
3.44%
5,018,002
41,873
3.38%
4,719,954
37,616
3.20%
Deposits in financial institutions
1,912,585
17,357
3.64%
1,742,657
15,626
3.64%
1,872,736
20,590
4.41%
Total interest-earning assets
32,117,529
414,596
5.18%
31,471,268
407,442
5.25%
31,097,009
420,509
5.42%
Other assets
2,527,401
2,531,433
2,667,140
Total assets
$34,644,930
$34,002,701
$33,764,149
Liabilities and Stockholders' Equity:
Interest checking
$8,313,161
47,694
2.30%
$8,175,172
46,882
2.33%
$7,778,882
52,877
2.73%
Money market
4,736,107
23,429
1.98%
4,785,691
22,826
1.93%
5,412,681
33,615
2.49%
Savings
1,883,240
9,575
2.04%
1,957,831
9,772
2.02%
1,959,987
12,777
2.61%
Time
4,820,101
43,572
3.63%
4,510,418
40,753
3.66%
4,569,490
45,671
4.01%
Total interest-bearing deposits
19,752,609
124,270
2.52%
19,429,112
120,233
2.51%
19,721,040
144,940
2.95%
Borrowings
2,399,546
26,568
4.44%
1,765,661
20,177
4.63%
1,628,584
20,021
4.93%
Subordinated debt
699,159
13,257
7.61%
953,739
15,415
6.55%
946,740
15,332
6.50%
Total interest-bearing liabilities
22,851,314
164,095
2.88%
22,148,512
155,825
2.85%
22,296,364
180,293
3.24%
Noninterest-bearing demand deposits
7,866,139
7,890,489
7,583,894
Other liabilities
382,336
415,000
453,748
Total liabilities
31,099,789
30,454,001
30,334,006
Stockholders' equity
3,545,141
3,548,700
3,430,143
Total liabilities and stockholders' equity
$34,644,930
$34,002,701
$33,764,149
Net interest income (1)
$250,501
$251,617
$240,216
Net interest spread
2.30%
2.40%
2.18%
Net interest margin
3.13%
3.24%
3.10%
Total deposits (2)
$27,618,748
$124,270
1.80%
$27,319,601
$120,233
1.78%
$27,304,934
$144,940
2.13%
Total funds (3)
$30,717,453
$164,095
2.14%
$30,039,001
$155,825
2.10%
$29,880,258
$180,293
2.42%
______________
(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.
(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
on total deposits divided by average total deposits.
(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
divided by average total funds.
                                              19
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
AVERAGE BALANCE, AVERAGE YIELD EARNED, AND AVERAGE COST PAID
(UNAUDITED)
Six Months Ended
June 30, 2026
June 30, 2025
Interest
Average
Interest
Average
Average
Income/
Yield/
Average
Income/
Yield/
Balance
Expense
Cost
Balance
Expense
Cost
(Dollars in thousands)
Assets:
Loans and leases (1)
$24,990,197
$704,775
5.69%
$24,148,460
$708,406
5.92%
Investment securities
4,977,896
84,280
3.41%
4,726,957
75,478
3.22%
Deposits in financial institutions
1,828,090
32,983
3.64%
1,979,843
43,280
4.41%
Total interest-earning assets
31,796,183
822,038
5.21%
30,855,260
827,164
5.41%
Other assets
2,529,406
2,682,266
Total assets
$34,325,589
$33,537,526
Liabilities and Stockholders' Equity:
Interest checking
$8,244,548
94,576
2.31%
$7,562,369
100,756
2.69%
Money market
4,760,762
46,255
1.96%
5,414,190
66,618
2.48%
Savings
1,920,329
19,347
2.03%
1,954,349
25,634
2.65%
Time
4,666,115
84,325
3.64%
4,534,076
92,462
4.11%
Total interest-bearing deposits
19,591,754
244,503
2.52%
19,464,984
285,470
2.96%
Borrowings
2,084,355
46,745
4.52%
1,513,790
38,442
5.12%
Subordinated debt
825,746
28,672
7.00%
944,790
30,672
6.55%
Total interest-bearing liabilities
22,501,855
319,920
2.87%
21,923,564
354,584
3.26%
Noninterest-bearing demand deposits
7,878,247
7,649,000
Other liabilities
398,577
488,060
Total liabilities
30,778,679
30,060,624
Stockholders' equity
3,546,910
3,476,902
Total liabilities and stockholders' equity
$34,325,589
$33,537,526
Net interest income (1)
$502,118
$472,580
Net interest spread
2.34%
2.15%
Net interest margin
3.18%
3.09%
Total deposits (2)
$27,470,001
$244,503
1.79%
$27,113,984
$285,470
2.12%
Total funds (3)
$30,380,102
$319,920
2.12%
$29,572,564
$354,584
2.42%
______________
(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 deposits is the sum of total interest-bearing deposits and noninterest-bearing demand deposits. The cost of total deposits is calculated as annualized interest expense
on total deposits divided by average total deposits.
(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
divided by average total funds.
                                              20
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
NON-GAAP MEASURES
We refer to certain financial measures that are not recognized under U.S. generally accepted accounting principles (“GAAP”) in this press
release, including: tangible common equity, tangible book value per common share, return on average tangible common equity, pre-tax
pre-provision income, efficiency ratio, and economic coverage ratio. These non-GAAP measures are used by management in its analysis of
the Company's performance.
Tangible common equity is calculated by subtracting preferred stock, as applicable, from total common equity. Return on average tangible
common equity is calculated by dividing net earnings available to common stockholders, after adjustment for amortization of intangible
assets and any goodwill impairment, by average tangible common equity. Banking regulators also exclude goodwill and other intangible
assets from stockholders' equity when assessing the capital adequacy of a financial institution.
Pre-tax pre-provision income is calculated by subtracting noninterest expense from total revenue, which is the sum of net interest income
and noninterest income.
Efficiency ratio is calculated by dividing noninterest expense (less intangible asset amortization and acquisition, integration and
reorganization costs) by total revenue (the sum of net interest income and noninterest income, less gain (loss) on securities AFS).
Economic coverage ratio is calculated by dividing the allowance for credit losses adjusted for the impact of the credit-linked notes and
unearned credit mark from purchase accounting by loans and leases HFI.
Management believes the presentation of these financial measures adjusting the impact of these items provides useful supplemental
information that is essential to a proper understanding of the financial results and operating performance of the Company. This disclosure
should not be viewed as a substitute 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 provide reconciliations of the non-GAAP measures to financial measures defined by GAAP.
                                              21
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
NON-GAAP MEASURES
(UNAUDITED)
Tangible Common Equity
June 30,
March 31,
December 31,
September 30,
June 30,
and Tangible Book Value Per Share
2026
2026
2025
2025
2025
(Dollars in thousands, except per share amounts)
Stockholders' equity
$3,410,146
$3,553,326
$3,541,277
$3,466,739
$3,426,843
Less: Preferred stock
498,516
498,516
498,516
498,516
498,516
Total common equity
2,911,630
3,054,810
3,042,761
2,968,223
2,928,327
Less: Goodwill and intangible assets
307,230
313,612
319,808
326,444
333,451
Tangible common equity
$2,604,400
$2,741,198
$2,722,953
$2,641,779
$2,594,876
Book value per common share (1)
$18.38
$19.80
$19.56
$19.09
$18.58
Tangible book value per common share (2)
$16.44
$17.77
$17.51
$16.99
$16.46
Common shares outstanding (3)
158,432,520
154,262,045
155,533,403
155,522,693
157,647,137
______________
(1) Total common equity divided by common shares outstanding.
(2) Tangible common equity divided by common shares outstanding.
(3) Common shares outstanding include non-voting common stock equivalents that are participating securities. There were no non‑voting common stock equivalents
outstanding as of June 30, 2026 and March 31, 2026.
                                              22
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
NON-GAAP MEASURES
(UNAUDITED)
Three Months Ended
Six Months Ended
Return on Average Tangible
June 30,
March 31,
June 30,
June 30,
Common Equity ("ROATCE")
2026
2026
2025
2026
2025
(Dollars in thousands)
Net (loss) earnings
$(241,347)
$71,952
$28,385
$(169,395)
$81,953
Adjustments:
Intangible asset amortization
6,349
6,348
7,159
12,697
14,319
Tax impact of adjustment above (1)
(1,778)
(1,596)
(1,655)
(3,720)
(3,311)
Adjustment to net (loss) earnings
4,571
4,752
5,504
8,977
11,008
Adjusted net (loss) earnings for ROATCE
(236,776)
76,704
33,889
(160,418)
92,961
Less: Preferred stock dividends
9,947
9,947
9,947
19,894
19,894
Adjusted net (loss) earnings available to
common and equivalent stockholders for ROATCE
$(246,723)
$66,757
$23,942
$(180,312)
$73,067
Average stockholders' equity
$3,545,141
$3,548,700
$3,430,143
$3,546,910
$3,476,902
Less: Average goodwill and intangible assets
311,068
317,215
337,352
314,125
340,961
Less: Average preferred stock
498,516
498,516
498,516
498,516
498,516
Average tangible common equity
$2,735,557
$2,732,969
$2,594,275
$2,734,269
$2,637,425
Return 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%
______________
(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
29.30% and 23.12% used for the six months ended June 30, 2026 and 2025.
(2) Annualized net (loss) earnings divided by average stockholders' equity.
(3) Annualized adjusted net (loss) earnings available to common and equivalent stockholders for ROATCE divided by average tangible common equity.
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
Pre-Tax Pre-Provision (Loss) Income
2026
2026
2025
2026
2025
(Dollars in thousands)
Net interest income (GAAP)
$250,501
$251,617
$240,216
$502,118
$472,580
Add: Noninterest (loss) income (GAAP)
(234,096)
35,328
32,633
(198,768)
66,283
Total revenues (GAAP)
16,405
286,945
272,849
303,350
538,863
Less: Noninterest expense (GAAP)
189,867
181,391
185,869
371,258
369,522
Pre-tax pre-provision (loss) income (Non-GAAP)
$(173,462)
$105,554
$86,980
$(67,908)
$169,341
                                              23
jpega.jpg
image_28a.jpg
BANC OF CALIFORNIA, INC.
NON-GAAP MEASURES
(UNAUDITED)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
Efficiency Ratio
2026
2026
2025
2026
2025
(Dollars in thousands)
Noninterest expense
$189,867
$181,391
$185,869
$371,258
$369,522
Less: 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
$355,203
Net interest income
$250,501
$251,617
$240,216
$502,118
$472,580
Noninterest (loss) income
(234,096)
35,328
32,633
(198,768)
66,283
Total revenue
16,405
286,945
272,849
303,350
538,863
Add: Loss on securities AFS
256,749
—
—
256,749
—
Total revenue used for efficiency ratio
$273,154
$286,945
$272,849
$560,099
$538,863
Noninterest expense to total revenue
1157.37%
63.21%
68.12%
122.39%
68.57%
Efficiency ratio (1)
67.18%
61.00%
65.50%
64.02%
65.92%
______________
(1) Noninterest expense used for efficiency ratio divided by total revenue used for efficiency ratio.
June 30,
March 31,
June 30,
Economic Coverage Ratio
2026
2026
2025
(Dollars in thousands)
Allowance for credit losses ("ACL")
$276,240
$276,521
$258,565
Add: Unearned credit mark from purchase accounting (1)
12,920
14,315
19,199
Add: Credit-linked notes (2)
105,026
104,988
112,887
Adjusted allowance for credit losses
$394,186
$395,824
$390,651
Loans and leases HFI
$24,210,846
$24,780,347
$24,245,893
ACL to loans and leases HFI (3)
1.14%
1.12%
1.07%
Economic coverage ratio (4)
1.63%
1.60%
1.61%
______________
(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
loans without credit deterioration at the time of purchase).
(2) Credit-linked notes loss coverage equal to 5% of the unpaid principal balance of the pledged loans.
(3) Allowance for credit losses divided by loans and leases HFI.
(4) Adjusted allowance for credit losses divided by loans and leases HFI.
Investor Presentation Second Quarter 2026 Results

 

Forward-Looking Statements and Other Matters This presentation includes forward-looking statements within the meaning of the “Safe-Harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements related to our expectations regarding the performance of our business, liquidity and capital ratios; the anticipated benefits of our strategic repositioning including, among others, a strengthened credit profile, possible net interest income and net interest margin expansion, and an enhanced earnings profile; and other non-historical statements, including statements in the “2026 Updated Outlook” section of this presentation. Words or phrases such as “believe,” “will,” “should,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” “strategy,” or similar expressions are intended to identify these forward-looking statements. You are cautioned not to place undue reliance on any forward-looking statements. 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. (the “Company”) with the Securities and Exchange Commission (“SEC”). The Company undertakes no obligation to revise or publicly release any revision or update to these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made, except as required by law. Factors that could cause actual results to differ materially from the results anticipated or projected include, but are not limited to: (i) changes in general economic conditions, either nationally or in our market areas, including the impact of tariffs and retaliatory tariffs, supply chain disruptions, and the risk of recession or an economic downturn; (ii) changes in the interest rate environment, including the recent and potential future changes in the FRB benchmark rate, which could adversely affect our revenue and expenses, the value of assets and obligations, the realization of deferred tax assets, the availability and cost of capital and liquidity, and the impacts of continuing or renewed inflation; (iii) the credit risks of lending activities, which may be affected by deterioration in real estate markets and the financial condition of borrowers, and the operational risk of lending activities, including the effectiveness of our underwriting practices and the risk of fraud, any of which may lead to increased loan delinquencies, losses, and non-performing assets, and may result in our allowance for credit losses not being adequate; (iv) fluctuations in the demand for loans, and fluctuations in commercial and residential real estate values in our market area; (v) the quality and composition of our securities portfolio; (vi) our ability to develop and maintain a strong core deposit base, including among our venture banking clients, or other low cost funding sources necessary to fund our activities particularly in a rising or high interest rate environment; (vii) the rapid withdrawal of a significant amount of demand deposits over a short period of time; (viii) our ability to achieve or maintain the anticipated benefits of our strategic repositioning due to one or more of the other factors described herein or otherwise, or the failure to complete our anticipated loan sales due to a condition to closing not being satisfied or 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 Company’s acquisitions, including disruption to current plans and operations; difficulties in customer and employee retention; fees, expenses and charges related to these transactions being significantly higher than anticipated; and our inability to achieve expected revenues, cost savings, synergies, and other benefits; (xii) the competitive and other impacts on our business of emerging technologies, including stablecoins and other digital currencies, tokenized deposits, blockchain, artificial intelligence, quantum computing, and related innovations affecting both the Company and the banking industry; (xiii) results of examinations by regulatory authorities of the Company and the possibility that any such regulatory authority may, among other things, limit our business activities, restrict our ability to invest in certain assets, refrain from issuing an approval or non-objection to certain capital or other actions, increase our allowance for credit losses, result in write-downs of asset values, restrict our ability or that of our bank subsidiary to pay dividends, or impose fines, penalties or sanctions; (xiv) legislative or regulatory changes that adversely affect our business, including changes in tax laws and policies, accounting policies and practices, privacy laws, and regulatory capital or other rules; (xv) the risk that our enterprise risk management framework may 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 and liabilities, as well as the value of collateral supporting our loans, which may result in significant changes in valuation or recoveries; (xvii) cybersecurity threats and failures or security breaches with respect to the network, applications, vendors and computer systems on which we depend; (xviii) our ability to attract and retain key members of our senior management team; (xix) the effects of climate change, severe weather events, natural disasters such as earthquakes and wildfires, pandemics, epidemics and other public health crises, military activity (including the ongoing Iran war) or acts of terrorism, and other external events on our business; (xx) the impact of bank failures or other adverse developments at other banks on general depositor and investor sentiment regarding the stability and liquidity of banks; (xxi) the possibility that our recorded goodwill could become impaired, which may have an adverse impact on our earnings and capital; (xxii) our existing indebtedness, together with any future incurrence of additional indebtedness, could adversely affect our ability to raise additional capital and to meet our debt obligations; (xxiii) changes in market conditions or strategic balance sheet actions, which may result in realized losses on investment securities or other assets; (xxiv) the effects of any damage to our reputation resulting from developments related to any of the items identified above; and (xxv) other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products and services and the other risks described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and from time to time in other documents that we file with or furnish to the SEC. Included in this presentation are certain non-GAAP financial measures, such as tangible assets, tangible common equity ratio, tangible book value per common share, adjusted net earnings, adjusted earnings per share, return on average tangible common equity, adjusted return on average tangible common equity, pre-tax pre-provision income, adjusted noninterest expense, adjusted noninterest expense to average assets, efficiency ratio, adjusted efficiency ratio, core deposits, core loans, economic coverage ratio, and adjusted ACL ratio, designed to complement the financial information presented in accordance with U.S. GAAP because management believes such measures are useful to investors. These non-GAAP financial measures should be considered only as supplemental to, and not superior to, financial measures provided in accordance with GAAP. Please refer to the “Non-GAAP Financial Information” and “Non-GAAP Reconciliation” sections of the appendix of this presentation for additional detail including reconciliations of non-GAAP financial measures included in this presentation to the most directly comparable financial measures prepared in accordance with GAAP. Because GAAP financial measures on a forward-looking basis are not accessible, and reconciling information is not available without unreasonable effort, we have not provided reconciliations for forward-looking non-GAAP financial measures, including ROTCE future state targets. For the same reasons, we are unable to address the probable significance of the unavailable information, which could be material to future results. Second Quarter 2026 Earnings | 2

 

Core franchise momentum and strategic balance sheet repositioning drive higher recurring earnings power 2Q26 Financial Results Second Quarter 2026 Earnings | 3 ($1.61) Loss Per Share 56% Decrease in Special Mention Loans 9% Average Loan Growth Annualized 12% EOP Deposit Growth Annualized 3.30%+ NIM Post Loan Sale and Reinvestments(1) 31% Decrease in Classified Loans ❖Strategic balance sheet repositioning executed through three targeted actions: a $2.3B securities repositioning, an ~$825mm targeted loan sale and retirement of $385mm of subordinated debt ❖Increases recurring earnings and accelerates organic capital generation ❖Improves capital efficiency and balance sheet flexibility 1. Represents NIM upon targeted ~$825mm loan sale closing and completion of reinvestment of proceeds related to HTM securities repositioning.

 

Implemented three strategic actions to generate higher recurring earnings and improve capital efficiency Strategic Balance Sheet Repositioning Second Quarter 2026 Earnings | 4 Three complementary actions to allocate capital to higher-return opportunities Strategic Action • Immediate Benefit Long-Term Benefit Securities Repositioning Reallocated $2.3B of low-yielding securities into higher-yielding securities Targeted Loan Sale Initiated sale of ~$825mm of CRE loans Retired $385mm of subordinated debt ❖Higher yields ❖Shorter duration ❖Lower special mention and classified loans ❖Lower risk-weighted assets ❖Reduces interest rate reset risk ❖Higher recurring NII ❖Less interest rate risk ❖Higher capital efficiency ❖Higher recurring earnings ❖Enhanced balance sheet flexibility ❖Higher recurring earnings Expected NIM of 3.30%+ following loan sale closing and completion of securities reinvestment

 

Securities repositioning drives higher recurring earnings Strategic Actions – Securities Repositioning Second Quarter 2026 Earnings | 5 Total Securities Portfolio Summary 3.02% 4.34% 19.5% 9.5% 5 years 4 years 1Q26 2Q26 Change +132 bps -1 year -1000 bps Spot Yield Duration Risk Weighting (%) Key Takeaways ❖ Repositioned $2.3B of low-yielding securities; Initial reinvestment of $1.7B of proceeds into higher-yielding assets as of 6/30 ❖ Securities sold: 2.11% yield, 6.3-year duration ❖ Reinvested securities: 4.87% yield, 3.5-year duration ❖ Higher yields support higher recurring net interest income ❖ Shorter duration increases balance sheet flexibility ❖ Favorable risk weighting increases capital efficiency ❖ Expected TBV earn-back(1) of 1.4 years 1. Represents Day 1 TBV loss – reinvestment uplift defined as day 1 loss on tangible book value divided by tax affected interest income pickup from reinvestment.

 

Targeted loan sale reduces risk and strengthens our portfolio composition Strategic Actions – Loan Sale Second Quarter 2026 Earnings | 6 Earnings Capital CreditTransaction Overview ❖ Initiated sale process of ~$825mm of select CRE loans ❖Weighted average interest rate on loans being sold is 4.6% ❖We expect the loan sale transactions to close in the third quarter Strategic Benefits ❖Reduces special mention loans by 56% ❖Reduces classified loans by 31% ❖Reduces exposure to credits with higher migration and concentration risk ❖ Increased capital efficiency as proceeds will be deployed into market rate loans ❖CET1 will increase with loan sale transaction closing ❖Proceeds to be redeployed into higher risk-adjusted return opportunities ❖Attractive sale economics preserve value while improving future earnings profile

 

Our strategic balance sheet repositioning creates higher recurring earnings and profitability 2026 Updated Outlook Second Quarter 2026 Earnings | 7 NIM 3.30-3.40% By year-end ROAA 0.95-1.00% By year-end ROATCE 11.5-12.5% By year-end PTPP $125-$130mm 4Q26 (1) (1) 1. Denotes a non-GAAP financial measure; see “Non-GAAP Reconciliation” slides in Appendix. 2.66% 3.08% 3.24% 1Q24 1Q25 1Q26 4Q26 Target 3.30- 3.40% $52mm $82mm $106mm 1Q24 1Q25 1Q26 4Q26 Target $125- $130mm 0.33% 0.65% 0.86% 1Q24 1Q25 1Q26 4Q26 Target 0.95- 1.00% 4.36% 7.56% 9.91% 1Q24 1Q25 1Q26 4Q26 Target 11.5- 12.5%

 

Second Quarter 2026 Earnings | 8 Rapid Capital Generation Compounded higher earnings growth provides path to CET1 above 10.0% in early 2027 10.18% 1Q26 Reported CET1 -0.54% HTM Repositioning -0.44% Provision expense +0.30- 0.40% 3Q26 Loan Sale Close and Other Estimated 3Q26 CET1 9.50- 9.60%+ ’26 Year-end Target CET1 9.80- 9.90%+ Early 2027 CET1 10.00%+ CET1 Bridge Key Takeaways ❖Strategic actions accelerate organic capital generation ❖CET1 post loan sale closing is expected to be ~9.50% ❖Expected CET1 >10.00% in early 2027 independent of any regulatory capital reform ❖Regulatory capital reform provides upside potential Higher recurring earnings compound capital growth, expected to result in CET1 >10.0% in early 2027

 

1. 2Q25 PTPP, Diluted EPS, ROAA and ROATCE are adjusted figures; see “Non-GAAP Reconciliation” slides in Appendix 2. Denotes a non-GAAP financial measure; see “Non-GAAP Reconciliation” slides in Appendix. 3. Production includes new loan production and disbursements. Core franchise performance remained strong while strategic repositioning enhanced recurring earnings power Quarterly Highlights Second Quarter 2026 Earnings | 9 Change 2Q26 1Q26 2Q25(1) QoQ D YoY D Reported Results PTPP(2) -$173.5mm $105.6mm $87.0mm NM NM Diluted EPS -$1.61 $0.39 $0.31 ($2.00) ($1.92) ROAA -2.79% 0.86% 0.69% NM NM ROATCE(2) -36.18% 9.91% 8.34% NM NM NIM 3.13% 3.24% 3.10% -11 bps 3 bps Capital TBVPS(2) $16.44 $17.77 $16.46 ($1.33) ($0.02) CET1 ratio 9.25% 10.18% 9.95% -93 bps -70 bps Credit ACL ratio 1.14% 1.12% 1.07% 2 bps 7 bps NIM NIM of 3.13%; NIM expected at 3.30%+ following loan sale closing and completion of securities reinvestment Credit Quality Special Mention and Classified loans down 56% and 31%, respectively ACL ratio increased 2 bps to 1.14% Loans Production(3) of $2.8B in 2Q26 Average loans up 9% annualized Deposits Total end-of-period deposits up 12% annualized Capital Expected CET1 of 9.50-9.60% in 3Q26 (includes impact of loan sale close)

 

Noteworthy items include the impact of significant transactions that were either unusual or elevated in magnitude during the quarter, largely related to our strategic repositioning Noteworthy Items Affecting 2Q26 Results Second Quarter 2026 Earnings | 10 Noteworthy Items Pre-Tax Impact ($mm) Net interest income Loan interest reversal ($5.0) Noninterest income HTM repositioning ($256.7) HFS fair-value adjustments ($12.5) Provision for credit losses Loan sales / charge-offs ($151.9) Noninterest expense Various expense items ($4.5) ❖Loan interest reversal impact related to loans classified as held-for-sale in 2Q ❖HTM repositioning impact is the loss on repositioning $2.3B of securities ❖ Impact to provision for credit losses is primarily comprised of fair value marks on loans transferred to held-for-sale ❖The noninterest expense items include a non- recurring charge for software obsolescence and temporarily elevated FDIC assessments ❖The impact of these noteworthy items increased the tax rate from 25% to 28% for the quarter

 

1. 2Q25 Diluted EPS, ROAA and ROATCE are adjusted figures; see “Non-GAAP Reconciliation” slides in Appendix 2. Denotes a non-GAAP financial measure; see “Non-GAAP Reconciliation” slides in Appendix. GAAP results reflect the 2Q26 strategic balance sheet repositioning actions, while underlying operating performance remained consistent with expectations Income Statement ($ in millions) 2Q26 1Q26 2Q25 Total interest income $414.6 $407.4 $420.5 Total interest expense 164.1 155.8 180.3 Net interest income 250.5 251.6 240.2 Loss on securities AFS (256.7) 0.0 0.0 Other noninterest income 22.7 35.3 32.6 Total noninterest (loss) income (234.1) 35.3 32.6 Total revenue 16.4 286.9 272.8 Operating expense 189.9 181.4 185.9 Total noninterest expense 189.9 181.4 185.9 PTPP (loss) income(2) (173.5) 105.6 87.0 Provision for credit losses 161.8 9.8 39.1 (Loss) earnings before income taxes (335.2) 95.8 47.9 Income tax (benefit) expense (93.9) 23.8 19.5 Net earnings (241.3) 72.0 28.4 Preferred stock dividends 9.9 9.9 9.9 Net earnings available to common and equivalent stockholders ($251.3) $62.0 $18.4 Key Income Statement Metrics 2Q26 1Q26 2Q25(1) Diluted EPS ($1.61) $0.39 $0.31 ROAA -2.79% 0.86% 0.69% ROATCE(2) -36.18% 9.91% 8.34% Net interest margin 3.13% 3.24% 3.10% NIE / average assets 2.20% 2.16% 2.21% Adj. NIE / average assets(2) 1.92% 1.88% 1.89% Efficiency ratio(2) 67.18% 61.00% 65.50% Adj. efficiency ratio(2) 64.01% 57.49% 61.77% Avg. yield on loans and leases 5.63% 5.74% 5.93% Avg. yield on interest-earning assets 5.18% 5.25% 5.42% Avg. total cost of funds 2.14% 2.10% 2.42% Avg. total cost of deposits 1.80% 1.78% 2.13% Second Quarter 2026 Earnings | 11

 

Strategic repositioning actions result in a stronger balance sheet, positioning the company for even stronger financial performance 1. Denotes a non-GAAP financial measure; see “Non-GAAP Reconciliation” slides in Appendix. 2. Total funding defined as total deposits plus borrowings. Balance Sheet Second Quarter 2026 Earnings | 12 ($ in millions) 2Q26 1Q26 2Q25 Cash and cash equivalents $2,818 $2,217 $2,354 Investment securities 4,665 5,140 4,725 Loans held for sale 915 259 466 Loans and leases HFI 24,211 24,780 24,246 Allowance for loan and lease losses (243) (242) (229) Goodwill and intangibles 307 314 333 Deferred tax asset, net 704 653 692 Other assets 1,653 1,602 1,665 Total assets $35,031 $34,724 $34,250 Noninterest-bearing deposits $7,758 $7,798 $7,441 Interest-bearing deposits 20,363 19,525 20,087 Total deposits 28,121 27,322 27,528 Borrowings 2,460 2,551 1,917 Subordinated debt 574 954 949 Other liabilities 466 343 429 Total liabilities excluding deposits 3,500 3,849 3,295 Total stockholders’ equity 3,410 3,553 3,427 Total liabilities and stockholders’ equity $35,031 $34,724 $34,250 Key Balance Sheet Metrics 2Q26 1Q26 2Q25 Average interest-earning assets $32,118 $31,471 $31,097 CET1 ratio 9.25% 10.18% 9.95% Tangible common equity ratio(1) 7.50% 7.97% 7.65% Tangible book value per share(1) $16.44 $17.77 $16.46 Cash / assets 8.0% 6.4% 6.9% Cash + securities / assets 21.4% 21.2% 20.7% Loans / deposits 89.3% 91.6% 89.8% Noninterest-bearing deposits / total deposits 27.6% 28.5% 27.0% Deposits / total funding(2) 92.0% 91.5% 93.5% Total brokered deposits / total funding(2) 9.2% 9.3% 9.8% ACL ratio 1.14% 1.12% 1.07%

 

Net Interest Income (NII) ($mm) and Net Interest Margin (NIM) (%) Impact to NII ($mm) from cumulative change in yields, rates and mix 1Q26 +$4.9 Loans +$1.7 Cash / Other EA +$0.5 Securities Deposits -$4.2 Borrowings 2Q26 $251.6 -$4.0 $250.5 $240.2 $253.4 $251.4 $251.6 $250.5 3.20% 4Q25 3.24% 1Q26 3.13% 2Q26 3Q26 Target 4Q26 Target2Q25 3Q25 3.10% 3.22% 3.30- 3.35% 3.30- 3.40% The benefits of the strategic repositioning should meaningfully increase NIM Net Interest Income and Net Interest Margin ❖ NIM expected at 3.30%+ following loan sale closing and completion of securities reinvestment ❖ 2Q26 NIM of 3.13% was negatively impacted by nonaccrual interest of ~$4.6mm HIGHLIGHTS Second Quarter 2026 Earnings | 13

 

Underlying noninterest income remained stable despite strategic repositioning charges ($ in millions) 2Q26 1Q26 2Q25 Commissions and Fees $9.0 $11.0 $9.6 Leased Equipment Income 7.8 8.5 10.2 Service Charges on Deposits 4.8 5.0 4.5 Dividends & Gains (Losses) on Equity Investments 3.3 2.0 (0.1) Loss on securities AFS (256.7) 0.0 0.0 Other Income (1) (2.3) 8.8 8.4 Total Noninterest Income ($234.1) $35.3 $32.6 Noninterest Income HIGHLIGHTS ❖ Noninterest income includes $256.7mm loss on securities AFS, and a $12.5mm loss for market valuation adjustment on previously transferred HFS loans ❖ Noninterest income, excluding loss on securities AFS and loss on loans HFS, of $35.2mm remained stable QoQ, consistent with normal run-rate of $11mm-$12mm per month ❖ Commissions and fees were lower QoQ, as 1Q26 FX fees were elevated due to higher trading volume driven by market volatility 1. Other income includes revenue from BOLI, warrants, credit-linked note related income, loss on loan sales, and other miscellaneous income. Second Quarter 2026 Earnings | 14

 

Adjusted Noninterest Expense(1) / Average Assets Ratio 1. Excludes customer related expense. Denotes a non-GAAP financial measure, see “Non-GAAP Reconciliation” slides in Appendix. 2. Denotes a non-GAAP financial measure, see “Non-GAAP Reconciliation” slides in Appendix. Expense discipline remained unchanged while executing significant strategic actions during the quarter 65.50% 62.05% 59.35% 61.00% 67.18% 61.77% 58.24% 55.58% 57.49% 64.01% 2Q25 3Q25 4Q25 1Q26 2Q26 Efficiency Ratio(2) Adjusted Efficiency Ratio(1) Adjusted Efficiency Ratio(1) 2.21% 1.89% 2Q25 2.18% 1.87% 3Q25 2.12% 1.83% 4Q25 2.16% 1.88% 1Q26 2.20% 1.92% 2Q26 Noninterest Expense / Average Assets Ratio Adjusted Noninterest Expense / Average Assets Ratio Noninterest Expense (1) Second Quarter 2026 Earnings | 15 ❖ Compensation expense declined QoQ driven by elevated 1Q26 seasonality ❖ Insurance and assessments increased QoQ primarily due to higher FDIC assessment expense ❖ Other expense increased QoQ primarily due to $4.8mm software obsolescence expense HIGHLIGHTS ($ in millions) 2Q26 1Q26 2Q25 Compensation $85.1 $91.1 $88.4 Occupancy 14.7 14.9 15.5 IT and data processing 13.8 14.3 13.1 Professional services 5.6 4.2 6.4 Insurance and assessments 14.5 6.8 9.4 Intangible asset amortization 6.3 6.3 7.2 Leased equipment depreciation 5.2 5.3 6.7 Loan expense 5.2 4.3 4.1 Other expense 15.4 10.4 8.7 Customer related expense 24.1 23.7 26.6 Total noninterest expense $189.9 $181.4 $185.9

 

Deposit franchise continues to generate stable funding for future growth 4.33% 4.30% 3.90% 3.64% 3.63% 2.13% 2.08% 1.89% 1.78% 1.80% Average Fed Funds Rate Average Total Cost of Deposits 27% 28% 28% 29% 28% 29% 29% 30% 30% 31% 27% 26% 25% 24% 25% 9% 9% 9% 9% 9% 8% 2Q25 8% 3Q25 8% 4Q25 8% 1Q26 7% 2Q26 Non-Brokered CDs Brokered CDs Money Market & Savings Interest-bearing Checking Noninterest-bearing Checking 1. Brokered non-maturity deposits consist of brokered sweep accounts included in Checking and MMDA. 2. Denotes a non-GAAP financial measure, see “Non-GAAP Reconciliation” slides in Appendix. 3. Represents all NIB deposit balances with ECR including through cash rebates and/or fee offsets. 4. Costs do not include ECR expenses related to HOA deposits. 5. Includes brokered CDs. Deposits By Line of Business ($mm) 2Q26 Balance 2Q26 Cost 1Q26 Balance 1Q26 Cost Community Banking $13,860 1.51% $13,823 1.51% Venture 7,086 2.18% 6,272 2.22% Specialty Banking (includes HOA)(4) 3,954 0.68% 3,970 0.70% Corporate and Other Institutional(5) 3,221 3.61% 3,258 3.56% Total Deposits $28,121 1.80% $27,322 1.78% ❖ Deposits increased 12% annualized, reflecting continued franchise momentum and strong growth late in the quarter ❖ Total cost of deposits increased 2 bps QoQ as average higher-cost deposit balances increased to support loan growth Deposits ($ in millions) 2Q26 1Q26 2Q25 Noninterest-bearing Checking $7,758 $7,798 $7,441 Checking 8,739 8,178 7,974 MMDA 5,137 4,643 5,375 Savings 1,835 1,991 1,933 CDs 4,653 4,712 4,805 Total Deposits $28,121 $27,322 $27,528 Less: Brokered CDs 2,591 2,562 2,312 Less: Brokered Non-maturity Deposits (1) 227 226 565 Core Deposits (2) $25,303 $24,534 $24,652 Average Noninterest-bearing Checking 7,866 7,890 7,584 Average NIB Checking / Average Deposits 28.5% 28.9% 27.8% NIB Deposits with ECR (3) 4,979 5,041 4,566 HIGHLIGHTS Second Quarter 2026 Earnings | 16

 

650 1,288 1,889 2,390 2,929 3,569 4,031 4,845 5,393 5,921 $107.3 1Q24 $257.8 2Q24 $382.6 3Q24 $439.2 4Q24 $537.8 1Q25 $643.2 2Q25 $746.8 3Q25 $965.2 4Q25 $1,113.5 1Q26 $1,212.6 2Q26 Cumulative New NIB Business Deposits Accounts Cumulative New NIB Business Deposits ($ millions) New NIB business deposit(1) relationship growth continues to build franchise value 1. Includes new NIB deposits from relationships opened over the last two years from the quarter referenced. NIB Deposit Growth Second Quarter 2026 Earnings | 17

 

$990 $826 $1,040 $1,147 $878 $911 $837 $1,443 $776 $1,610 $1,816 $2,186 $1,789 $2,280 $2,385 7.29% 7.08% 6.39%5.93% 6.05% 5.63% 6.83% 5.83% 6.65% 5.74% Rate on Production Total Loan Yield ($ in millions) 1. Rate on production is rate on new loans funded in respective quarter. 2. Includes charge-offs, transfers to foreclosed assets, loan sales, and transfers to HFS. Strong loan production and disbursements of $2.8B continues to remix the portfolio $997 $893 $1,696 $808 $989 Payoffs PaydownsUnfunded New Commitments 2Q25 3Q25 4Q25 1Q26 2Q26 $2,459 $2,068 $2,730 $2,119 $2,793 Loan Production and Disbursements Loan Activity (1) ❖ Broad-based 2Q26 production and disbursements of $2.8B continued to remix the portfolio toward higher risk-adjusted return assets, with new production pricing above the total loan yield ❖ Elevated payoffs and paydowns were driven by Fund Finance and Warehouse, partially offsetting strong production activity ❖ 2Q26 total loan yield declined 11 bps QoQ primarily due to impact of nonaccrual interest HIGHLIGHTS Second Quarter 2026 Earnings | 18 ($ in millions) Loans Beginning Balance Total Production/ Disbursements Total Payoffs/ Paydowns Net Change Other Change(2) Loans Ending Balance Total Loan Yield Rate on Production C&I Utilization Rate 2Q26 $24,780 $2,793 $2,385 407 (977) 24,211 5.63% 6.39% 67.9% 1Q26 25,033 2,119 2,280 (162) (91) 24,780 5.74% 6.65% 67.3% 4Q25 24,111 2,730 1,789 941 (19) 25,033 5.83% 6.83% 66.6% 3Q25 24,246 2,068 2,186 (118) (17) 24,111 6.05% 7.08% 66.1% 2Q25 24,127 2,459 1,816 643 (524) 24,246 5.93% 7.29% 64.8%

 

Loan remix continues to strengthen portfolio yields Note: Wtd. Avg. Rate excludes accretion of net deferred loan fees and net loan purchase discounts. 1. Venture lending includes technology and life science lending. Loan Activity by Segment ❖ Broad-based 2Q26 production continued to remix the portfolio toward higher-return categories, with strength in Fund Finance, Lender Finance and SFR ❖ Disciplined runoff of lower-return assets supports stronger portfolio economics, shifting balances away from lower-yielding legacy CRE and toward more attractive risk-adjusted categories ❖ Loan yields remained stable despite a declining rate environment, reflecting the benefit of remixing and disciplined pricing on new production ❖ Portfolio remix is expected to continue supporting margin over time as additional balances mature and reprice HIGHLIGHTS 2Q26 1Q26 2Q25 Loan Segment ($ in millions) Balances Production + Disbursements Payoffs + Paydowns Wtd. Avg Rate Balances Production + Disbursements Payoffs + Paydowns Wtd. Avg Rate Balances Production + Disbursements Payoffs + Paydowns Wtd. Avg Rate Multifamily $5,445 $139 ($91) 4.2% $5,955 $34 ($189) 4.2% $6,281 $111 ($82) 4.2% Other CRE 3,405 167 (138) 5.3% 3,444 57 (320) 5.3% 3,746 180 (235) 5.3% Real Estate Construction 1,475 190 (275) 6.2% 1,892 165 (131) 5.9% 2,302 173 (274) 6.0% Residential / Consumer 3,878 500 (148) 4.8% 3,529 234 (106) 4.6% 3,180 504 (102) 4.2% C&I 1,874 264 (267) 6.3% 1,886 406 (262) 6.3% 1,773 209 (286) 6.7% Warehouse 1,681 271 (395) 6.6% 1,805 264 (559) 6.7% 1,610 208 (198) 7.4% Venture Lending 936 110 (124) 7.0% 965 129 (67) 7.0% 808 119 (87) 7.8% Fund Finance 1,504 733 (586) 6.4% 1,358 470 (432) 6.5% 1,194 501 (263) 7.4% SBA 716 27 (40) 7.1% 730 18 (30) 6.9% 700 13 (27) 6.7% Lender Finance 2,017 351 (211) 6.7% 1,865 288 (60) 6.9% 1,173 375 (132) 7.8% Equipment Lending 661 37 (42) 6.0% 666 52 (60) 6.0% 645 60 (42) 6.0% Core Loan Portfolio $23,592 $2,789 ($2,317) 5.5% $24,095 $2,116 ($2,216) 5.5% $23,412 $2,453 ($1,730) 5.6% Premium Finance $356 $3 ($55) 3.4% $408 $2 ($41) 3.3% $473 $4 ($48) 3.4% Student 238 0 (11) 4.3% 250 0 (11) 4.3% 286 $1 ($13) 4.3% Civic 24 0 (3) 7.3% 27 0 (12) 7.2% 75 $0 ($25) 7.0% Discontinued Areas $618 $3 ($68) 3.9% $685 $2 ($64) 3.8% $834 $6 ($86) 4.0% Total Loans and Leases HFI $24,211 $2,793 ($2,385) 5.5% $24,780 $2,119 ($2,280) 5.4% $24,246 $2,459 ($1,816) 5.5% (1) Second Quarter 2026 Earnings | 19

 

Loan growth reflects continued franchise momentum Note: Wtd. Avg. Rate excludes accretion of net deferred loan fees and net loan purchase discounts. 1. Venture lending includes technology and life science lending. Loan Portfolio 2Q26 1Q26 2Q26 1Q26 Variance % of Total Loans 2Q26 Wtd. Avg. Rate 2Q26 NPL % 2Q26 DQ % 2Q26 ACL Coverage Ratio ACL Coverage Ratio Multifamily $5,445 $5,955 ($510) 22.5% 4.2% 0.21% 0.21% $50 0.92% $35 0.59% Other CRE 3,405 3,444 (39) 14.1% 5.3% 1.88% 0.57% 87 2.55% 88 2.55% Real Estate Construction 1,475 1,892 (417) 6.1% 6.2% 0.16% 0.16% 17 1.15% 19 0.99% Residential / Consumer 3,878 3,529 349 16.0% 4.8% 1.14% 2.50% 9 0.23% 8 0.22% C&I 1,874 1,886 (12) 7.7% 6.3% 0.68% 0.85% 26 1.37% 27 1.41% Warehouse 1,681 1,805 (124) 6.9% 6.6% 0.00% 0.00% 4 0.24% 3 0.16% Venture Lending (1) 936 965 (29) 3.9% 7.0% 1.54% 0.00% 60 6.39% 74 7.71% Fund Finance 1,504 1,358 147 6.2% 6.4% 0.00% 0.00% 0 0.03% 0 0.03% SBA 716 730 (14) 3.0% 7.1% 6.04% 1.20% 5 0.75% 5 0.68% Lender Finance 2,017 1,865 152 8.3% 6.7% 0.00% 0.00% 6 0.32% 6 0.34% Equipment Lending 661 666 (5) 2.7% 6.0% 0.00% 0.89% 1 0.20% 1 0.21% Core Loan Portfolio $23,592 $24,095 ($503) 97.4% 5.5% 0.82% 0.68% $266 1.13% $266 1.10%0 0 0% 0.00% 0.00% Premium Finance $356 $408 ($52) 1.5% 3.4% 0.00% 0.00% $0 0.07% $0 0.07% Student 238 250 (12) 1.0% 4.3% 0.47% 0.96% 10 4.07% 10 4.02% Civic 24 27 (3) 0.1% 7.3% 40.47% 43.73% 0 0.05% 0 0.05% Discontinued Areas $618 $685 ($67) 2.6% 3.9% 1.76% 2.08% $10 1.61% $10 1.51% Total Loans and Leases HFI $24,211 $24,780 ($570) 100.0% 5.5% 0.84% 0.72% $276 1.14% $277 1.12% Loans Held for Sale (HFS) 915 259 656 Total Loans and Leases $25,126 $25,039 $87 Loan Segment ($ in millions) Second Quarter 2026 Earnings | 20 ❖ Average loan balances grew 9% annualized, driven by higher-yielding C&I categories

 

Approximately half of the multifamily portfolio is expected to reprice or mature over the next 2.5 years, providing meaningful embedded earnings upside Note: Long Term (“LT”) Variable: Loans that reset or mature beyond one year. Weighted Average Coupon (“WAC”): Weighted average of the contractual interest rate. 1. Balances include maturities only and do not include scheduled amortization and prepayment expectations. Loan Composition ❖ Total fixed rate and hybrid loans that are maturing/repricing by year-end have a WAC of 5.0%, significantly below 2Q26 rate on new production of 6.39% ❖ ~$0.9B of hybrid multifamily loans maturing/repricing within 1 year have a WAC of 4.5%, offering strong repricing upside ❖ Short-term variable loans represent 39% of total loans HIGHLIGHTS Loan Maturity and Repricing Summary Second Quarter 2026 Earnings | 21 41% 39% 20% 2Q26 Fixed ST Variable Hybrid+LT Variable WAC: 4.8% WAC: 6.6% WAC: 4.8% $0.3 $0.1 $0.3 $1.4 $1.4 $0.7 $0.8 $0.4 4.0% 5.5% 3.7% 3.9% 3.9% 4.2% 5.1% 4.0% Multifamily Loans – Maturities / Repricing Hybrid & Variable Rate: Fixed Rate: Total Fixed Rate and Hybrid Loans – Maturities / Repricing Total fixed rate and hybrid loans: $13.3B Total multifamily loans: $5.4B 4.7% 4.4% 4.7%4.7%WAC: <= 1 Year 1-2 Years 2-3 Years > 3 Years $1.7B $0.8B $1.1B $1.8B Fixed Rate Maturity(1) Hybrid & Variable Rate Reset $1.3 $0.7 $1.1 $0.4 $1.5 $0.6 $1.0 $6.7 <= 1 Year 1-2 Years 2-3 Years > 3 Years $2.8B $1.3B $2.1B $7.1B Fixed Rate(1) Hybrid

 

Asset quality metrics strengthened through proactive portfolio management ❖ Asset quality metrics strengthened QoQ, with classified, special mention and delinquent loans declining 31%, 56% and 50%, respectively ❖ Sale (pending) of ~$825mm of CRE loans reduces exposure concentration, enhances capital efficiency and lowers potential future credit-related earnings volatility ❖ Healthy market demand and attractive pricing enabled us to be opportunistic with sale process ❖ We expect the loan sale transactions to close in the third quarter Special Mention Loans ($mm) Delinquent Loans ($mm) Classified Loans ($mm) $311.3 $320.1 $275.3 $281.9 $175.1 $465.7 $15.8 2Q25 $255.3 $478.9 $29.3 3Q25 $257.4 $520.1 $22.8 4Q25 $245.7 $583.1 $14.0 1Q26 $184.5 $387.4 $10.9 2Q26 $656.6 $763.6 $800.3 $842.8 $582.8 2.71% 3.17% 3.20% 3.40% 2.41% Classified Loans/Leases to Loans/Leases HFI CRE Loans (excluding MF and Construction) Other Core Loans(1) Discontinued Loans 0.62% 0.67% 0.80% 1.39% 0.72% Delinquent Loans to Loans/Leases HFI 1. Reference Page 19 for Core Loan Portfolio. Other Core Loans comprises Core Loan Portfolio less CRE loans (excluding MF and Construction). HIGHLIGHTS Nonperforming Loans ($mm) $55.7 $96.4 $15.4 2Q25 $56.2 $89.4 $28.9 3Q25 $53.1 $83.2 $22.8 4Q25 $48.4 $123.4 $14.0 1Q26 $64.2 $128.6 $10.9 2Q26 $167.5 $174.5 $159.2 $185.7 $203.7 CRE Loans (excluding MF and Construction) Other Core Loans(1) Discontinued Loans 0.69% 0.72% 0.64% 0.75% 0.84% $201.0 $454.5 $6.1 2Q25 $108.3 $392.0 $5.7 3Q25 $125.0 $328.5 $5.2 4Q25 $117.5 $566.1 $5.0 1Q26 $151.2 $146.4 $2.9 2Q26 $661.6 $506.0 $458.7 $688.7 $300.5 CRE Loans (excluding MF and Construction) Other Core Loans(1) Discontinued Loans 2.73% 2.10% 1.83% 2.78% 1.24% Special Mention Loans/Leases to Loans/Leases HFI NPLs to Loans/Leases HFI $42.7 $90.5 $16.2 2Q25 $46.3 $77.7 $37.4 3Q25 $40.9 $138.2 $21.8 4Q25 $35.4 $295.1 $14.6 1Q26 $19.5 $141.3 $12.9 2Q26 $149.5 $161.4 $201.0 $345.1 $173.7 CRE Loans (excluding MF and Construction) Other Core Loans(1) Discontinued Loans Asset Quality Ratios and Trends Second Quarter 2026 Earnings | 22 Targeted actions reduced potential migration and larger borrower concentration exposure

 

❖ ACL remained stable QoQ at $276.2mm, with ACL ratio increasing 2bps QoQ to 1.14% ❖ Net charge-offs were primarily driven by loans transferred to HFS ❖ Economic coverage ratio(1) increased 3bps to 1.63% ($ in millions) 2Q26 Net Charge-offs (Recoveries) detail ($160.3) ACL 1Q26 Net Charge-offs $160.0 Provision for Loans HFI ACL 2Q26 $276.5 ACL coverage ratio increased to 1.14% HIGHLIGHTS 1. Economic coverage ratio adjusts our ACL coverage ratio to include the loss coverage from credit-linked notes and unearned credit marks from purchase accounting. Denotes a non-GAAP financial measure, see “Non-GAAP Reconciliation” slides in Appendix. 1.63% Economic coverage ratio(1) $276.2 $258.6 1.07% 1.61% 2Q25 $270.7 1.12% 1.65% 3Q25 $280.5 1.12% 1.62% 4Q25 $276.5 1.12% 1.60% 1Q26 $276.2 1.14% 1.63% 2Q26 ACL ACL / Total Loans HFI Economic Coverage Ratio(1) ACL / Total Loans ($mm) 2Q26 ACL walk 1.12% 1.14% Net Charge-offs (Recoveries) ($ in millions) Charge-offs Recoveries Net Charge-offs (Recoveries) % of Total Loans (annualized) Civic Loans $0.6 ($0.0) $0.6 0.01% Commercial Loans 15.1 (0.9) 14.2 0.23% Real Estate Mortgage 77.2 (0.1) 77.1 1.22% Real Estate Construction 67.5 - 67.5 1.07% Consumer Loans: Student Loans - - - 0.00% Consumer Loans: excluding Student Loans 1.1 (0.3) 0.8 0.01% Total $161.6 ($1.3) $160.3 2.54% Allowance for Credit Losses - Loans Second Quarter 2026 Earnings | 23

 

Adjusted ACL ratio(1) is significantly higher when adjusting for lower loss loan categories 2Q26 Adjusted ACL Ratio(1) Composition of Lower Loss Loan Categories ❖ Recent loan growth is in segments with relatively low expected credit losses including lender finance, SFR and fund finance ❖ Adjusted ACL Ratio(1) at 1.70%; Economic Coverage Ratio(1) at 1.63%, which includes $105.0mm of loss coverage from credit-linked notes on SFR ❖ Lower loss loan categories as a percent of total loans increased to 37% at 2Q26 from 34% in 1Q26 strengthening the credit profile of the bank 1.14% 1.32% 1.42% 1.70% ACL Ratio Adj. ACL Ratio Excluding Single Family Residential Loans Adj. ACL Ratio Excluding SFR Mortgage & Warehouse Loans Adj. ACL Ratio Excluding SFR Mort., Warehouse, Fund Finance and Lender Finance Loans HIGHLIGHTS 1. Adjusted ACL Ratio is adjusted for lower loss loan categories. Economic Coverage Ratio is adjusted for the impact of credit-linked notes and unearned credit mark from purchase accounting. Denotes a non-GAAP financial measure, see "Non-GAAP Reconciliation” slides in Appendix. Adjusted Allowance for Credit Losses Ratios Lower Loss Loan Categories ($ in millions) 2Q26 1Q26 2Q25 Residential $3,770 $3,431 $3,083 Warehouse 1,681 1,805 1,610 Fund Finance 1,504 1,358 1,194 Lender Finance 2,017 1,865 1,173 Total Lower Loss Loans $8,972 $8,459 $7,061 Total Loans and Leases HFI $24,211 $24,780 $24,246 Lower Loss Loans / Total Loans and Leases HFI 37.1% 34.1% 29.1% Second Quarter 2026 Earnings | 24

 

Average Total Securities Portfolio Balance & Total Yield(3) 1. Excludes FRB and FHLB stock. 2. HTM securities reflected at amortized cost; excludes $0.7mm loss reserve. 3. Total securities yield of 3.44% and average securities portfolio balance includes FRB and FHLB stock. Total securities yield is calculated using average fair values for the quarter. Strategic securities repositioning will drive meaningful higher recurring earnings ❖ The securities portfolio is now positioned to contribute meaningfully more recurring income over time ❖ Limited 2Q26 yield impact from prior quarter due to timing of securities sale / reinvestment ❖ Unrealized pre-tax loss on AFS securities of $209mm, up $8mm QoQ driven primarily by an increase in interest rates. ❖ Of the AFS securities portfolio, 89% is fixed rate, 7% is floating rate, and 4% is hybrid rate ❖ 2Q26 new investment yield of 5.1% ❖ 8% of AFS securities portfolio will contractually pay down and reprice within 1 year and 24% within three years ❖ 89% of total securities are AAA rated and 6% are AA rated HIGHLIGHTS $4.7 3.20% 2Q25 $4.8 3.18% 3Q25 $4.9 3.21% 4Q25 $5.0 3.38% 1Q26 $4.9 3.44% 2Q26 Average Balance ($ in billions) Yield Investment Securities Portfolio Yield Duration (yrs) Unrealized Unrealized 2Q26 1Q26 Variance 2Q26 2Q26 Loss 2Q26 Loss 1Q26 AFS - Gov't & Agency $3,764 $1,970 $1,794 4.19% 4.3 ($168) ($160) AFS - CLO's 201 200 0 5.38% 0.0 0 0 AFS - Corporate Bonds 238 233 5 6.40% 1.1 (14) (14) AFS - Non-Agency Securitizations 282 254 28 3.98% 4.6 (28) (27) AFS $4,484 $2,657 $1,827 4.35% 4.0 ($209) ($201) HTM - Gov't & Agency 643 (643) (31) HTM - Corporate Bonds 71 (71) (7) HTM - Municipal Bonds 1,239 (1,239) (35) HTM - Non-Agency Securitizations 362 (362) (13) HTM(2) - $2,314 ($2,314) ($87) Total AFS + HTM Securities $4,484 $4,971 ($487) 3.44% 4.0 ($209) ($287) Security Type (1) ($ in millions) Second Quarter 2026 Earnings | 25 (3)

 

9.95% 10.18% 9.25% 2Q25 1Q26 2Q26 7.65% 7.97% 7.50% 2Q25 1Q26 2Q26 CET1 Ratio TCE Ratio(1) Note: 2Q26 regulatory capital ratios are preliminary. 1. Denotes a non-GAAP financial measure; see “Non-GAAP Reconciliation” slides in Appendix. Capital remains resilient while strategic actions position the company for faster organic capital generation Capital 2Q26 1Q26 2Q25 Regulatory Well- Capitalized Excess of Well- Capitalized Consolidated Company Total Risk-Based Ratio 14.31% 16.55% 16.37% 10.00% 4.31% Tier 1 Risk-Based Capital 11.67% 12.54% 12.34% 8.00% 3.67% CET1 Ratio 9.25% 10.18% 9.95% 6.50% 2.75% Leverage Ratio 8.89% 9.97% 9.74% 5.00% 3.89% TCE Ratio (1) 7.50% 7.97% 7.65% NA NA TBVPS (1) $16.44 $17.77 $16.46 NA NA Second Quarter 2026 Earnings | 26

 

2Q26 IRR position – NII impact ($B) ❖ Gap between short-term (“ST”) liabilities and assets of $5.8B in 2Q26 compared to $5.6B at 1Q26 ❖ HTM repositioning was largely NII-neutral, as greater asset sensitivity from shorter duration securities was offset by a higher NII base from significantly higher reinvestment yields ❖ When adjusted for deposit repricing betas, net interest income sensitivity is relatively neutral ❖ We have the potential to outperform our modeled deposit betas in both up and down rate scenarios dependent on economic conditions ❖ The impact of ECR costs on rate-sensitive deposits of $3.8B shifts this neutral interest rate sensitivity to liability sensitive for total earnings HIGHLIGHTS $15.7 $21.5 ST Assets ST Liabilities Asset / liability gap of ($5.8B) is largely neutral to NII when adjusting for deposits repricing betas 2Q26 IRR position – Total Earnings ($B) $15.7 $18.1 ST Assets ST Liabilities (Beta & ECR Adjusted) ECR costs on deposits when adjusted for repricing betas shifts IRR position to liability sensitive with a repricing gap at ($2.4B) Cash / ST Investments / ST Loans Cash / ST Investments / ST Loans Variable Deposits / ST CDs / ST Borrowings Variable Deposits / ST CDs / ST Borrowings Note: Short Term (“ST”): Assets and liabilities expected to mature, reprice, or settle within one year. Rate sensitive defined as assets or liabilities that are repricing or maturing within one year. Second Quarter 2026 Earnings | 27 Balance sheet position provides flexibility across multiple interest-rate environments Interest Rate Sensitivity Ongoing balance sheet remixing will support further net interest income expansion

 

Supplemental Information

 

Note: Common shares outstanding as of June 30, 2026 are 158,432,520. 1. Represents VWAP of shares repurchased. 2. Common shares outstanding are as of March 17, 2025 for Full Year 2025, December 31, 2025 for 1Q26, and March 31, 2026 for 2Q26. Total is based on share count from commencement of share repurchase program as of March 17, 2025. Delivering shareholder value through share repurchases Share repurchases Second Quarter 2026 Earnings | 29 Share Repurchase Activity FY25 1Q26 2Q26 Total Repurchase Amount $185,498,388 $31,942,722 - $217,441,110 Price Per Share(1) $13.59 $18.68 - $14.16 Number of Shares Repurchased 13,648,429 1,709,935 - 15,358,364 Common Shares Outstanding(2) 169,083,588 155,533,403 154,262,045 169,083,588 % of Shares Repurchased 8.1% 1.1% 0.0% 9.1%

 

Diversified NDFI exposure with history of minimal losses NDFI Lending Exposure Note: Asset quality metrics are based on loans and leases HFI. Mortgage Warehouse includes warehouse lines to mortgage originators, Fund Finance includes capital call facilities, Consumer Credit includes auto and consumer lending, Other Mortgage Credit includes mortgage rediscount lending and Business Credit includes small business lending. 1. 10-year+ historical NCO rate represents average quarterly net loss rate annualized since 1Q15. 2. Includes loans within Commercial & Community Banking segment. HIGHLIGHTS ❖ Long history of strong asset quality performance with almost no delinquencies, NPLs or classified loans ❖ Only three charge-offs over the last 10 years including one that resulted in nearly full recovery ❖ Careful client screening focuses on established operators with extensive, stable performance history ❖ In-house audit team conducts anti-fraud measures including monthly testing of underlying collateral, cash collections and payments history and periodic mortgage title checks ❖ Majority of loans are handled by the bank alone. Partner banks limited to banks with fraud, audit and control frameworks aligned with our rigorous standards NDFI Lending Exposure ❖ Business Credit, Consumer Credit, and Other Mortgage Credit are primarily within our Lender Finance business Loan Type ($ in millions) 2Q26 Loan Balance 2Q26 % of Total Loans HFI 2Q26 NPL % of Total Loans HFI 2Q26 DQ % of Total Loans HFI 2Q26 Classified % of Total Loans HFI 10-Year+ Historical NCO Rate(1) Mortgage Warehouse $1,681 6.9% 0.00% 0.00% 0.00% 0.052% Fund Finance(2) 1,536 6.3% 0.00% 0.00% 0.00% 0.000% Consumer Credit 961 4.0% 0.00% 0.00% 0.00% 0.000% Other Mortgage Credit 490 2.0% 0.00% 0.00% 0.00% 0.022% Business Credit 510 2.1% 0.00% 0.00% 0.00% 0.000% Other NDFI 41 0.2% 0.00% 0.00% 0.00% 0.000% Total NDFI Portfolio HFI $5,219 21.6% 0.00% 0.00% 0.00% 0.018% Total Core Loan Portfolio HFI $23,592 97.4% 0.82% 0.68% 2.42% Total Loans and Leases HFI $24,211 100.0% 0.84% 0.72% 2.41% Second Quarter 2026 Earnings | 30

 

❖ 76% of total CRE portfolio located in California ❖ Total CRE has a low weighted average LTV of 58% ❖ Other Property Types includes mobile homes, gas stations, special use, schools, places of worship and restaurants 8.0% 7.7% 5.4% 2.9% 2.3% 2.9% 1.7% 2.1% Office Industrial Retail Hotel Self Storage Health Facility Mixed Use Other Other CRE as % of Total CRE Total CRE is well diversified across multiple industries • Total CRE comprises 43% of total loans HFI and Other CRE comprises 14% of total loans HFI • 82% of office collateral located in California, 12% in Colorado and 6% in other states • Multifamily has a low average LTV and a strong DSCR coverage ratio of 1.3x Note: CRE excludes government guaranteed CRE collateralized SBA loans. 1. Represents most recent appraisal or weighted-average LTV at origination. CRE portfolio has low weighted-average LTV and strong debt-service coverage ratio (DSCR) HIGHLIGHTS CRE Portfolio Property Type ($ in millions) Count 2Q26 1Q26 2Q26 % of Total CRE 2Q26 % of Total Loans HFI Avg Loan Size WA LTV(1) DSCR NPL % NPL $ Multifamily 1,196 $5,445 $5,955 53% 22% $4.6 58% 1.34 0.21% $11.6 Real Estate Construction 171 1,475 1,892 14% 6% 8.6 66% - 0.16% 2.4 Other CRE 920 3,405 3,444 33% 14% 3.7 53% 2.02 1.88% 64.2 Office 182 829 855 8% 3% 4.6 61% 2.35 7.24% 60.1 Industrial / Warehouse 304 796 760 8% 3% 2.6 48% 2.03 0.00% 0.0 Retail 172 555 580 5% 2% 3.2 52% 1.56 0.07% 0.4 Hotel 27 294 333 3% 1% 10.9 51% 2.26 0.84% 2.5 Self Storage 39 242 235 2% 1% 6.2 56% 1.44 0.00% 0.0 Mixed Use 34 222 208 2% 1% 6.5 51% 1.50 0.00% 0.0 Health Facility 25 171 181 2% 1% 6.8 57% 2.46 0.67% 1.1 Other Property Types 137 295 293 3% 1% 2.2 47% 2.36 0.04% 0.1 Total CRE 2,287 $10,325 $11,292 100% 43% $4.5 58% 1.60 0.76% $78.2 Second Quarter 2026 Earnings | 31

 

Noninterest Expense Detail ($mm) $26.6 $9.4 $61.5 $88.4 2Q25 $26.2 $9.0 $61.6 $88.9 3Q25 $24.9 $7.1 $62.8 $85.9 4Q25 $23.7 $6.8 $59.8 $91.1 1Q26 $24.1 $14.5 $66.1 $85.1 2Q26 $185.9 $185.7 $180.6 $181.4 $189.9 Compensation expense Other operating expenses Insurance and assessments Customer related expense Customer Related Expense ($mm) $21.9 $4.7 2Q25 $21.7 $4.6 3Q25 $20.7 $4.1 4Q25 $19.8 $3.9 1Q26 2Q26 $26.6 $26.2 $24.9 $23.7 $24.1 $20.4 $3.7 ECR Expense Other(1) 1. Other customer related expense includes deposit referral fees, armored car services, check printing expenses, and other miscellaneous expenses. ECR expenses remained relatively flat 2Q25 3Q25 4Q25 1Q26 2Q26 $3,728 $3,708 $3,697 $3,891 $3,951 Average HOA Deposits ($mm) Customer Related Expense HIGHLIGHTS ❖ Substantially all HOA deposits have ECR expenses ❖ Average HOA balances increased due to business growth ❖ Total HOA deposit costs are 2.76% consisting of ECR expenses of 207 bps and deposit rate costs (through NIM) of 69 bps ❖ ECR indexed to Fed Funds rate with every 25 bps change corresponding to ~$6mm of annual ECR expense Second Quarter 2026 Earnings | 32

 

Expect total project and investment spend of ~$17mm in 2026, with ~$5.8mm of planned expense in 2026 Project investment composition Revenue enhancing projects Back office and support projects Projects and Investments Note: Total project and investment spend includes costs that are both capitalized and expensed. Second Quarter 2026 Earnings | 33 19% 81% Revenue Enhancing Back Office and Support Projects $3.2mm $13.8mm 18% 51% 31% Infrastructure Optimization/Scalability Regulatory/Compliance $7.0mm $4.3mm $2.5mm 13% 28% 59% Sales Enablement Payments Business Specific $0.9mm $1.9mm $0.4mm

 

❖Uninsured and uncollateralized deposits of $7.6B, which represents ~27% of total deposits ❖Total primary and secondary liquidity was 1.8x uninsured and uncollateralized deposits Maintaining high levels of primary and secondary liquidity 1. Cash and cash equivalents figure presented as Bank only, excludes restricted cash. 2. Net of 6.1% haircut as of June 30, 2026. ($ in millions) 2Q26 Current Availability Utilization Capacity Primary Liquidity Cash and cash equivalents $2,646 AFS Securities (unpledged) 3,556 Total Primary Liquidity 6,202 Total Secondary Liquidity 7,905 2,961 10,866 Total Primary + Secondary Liquidity $14,107 Definitions Secondary Liquidity: Net available borrowing capacity with the FHLB and FRB. Primary liquidity: Cash and cash equivalents (excluding restricted cash) and the market value of unencumbered Available-For-Sale (“AFS”) securities, net of a haircut. These assets are (i) unencumbered, (ii) readily available for use, and (iii) can be readily sold or pledged under normal operating conditions and under a range of stress conditions. (1) (2) Liquidity HIGHLIGHTS Second Quarter 2026 Earnings | 34

 

Experienced Management Team with Track Record of Success at Leading Institutions Scott Ladd Chief Credit Officer for Specialty Banking and Credit Operations 25+ years banking and consulting experience, previously served as EVP, Group Head, Portfolio Management at PacWest Bancorp Hamid Hussain President of the Bank 30+ years of banking experience, previously served as EVP, Real Estate Market Executive for Wells Fargo Bryan Corsini Chief Credit Officer 35+ years of banking experience, previously served as CCO of PacWest Bancorp and Director of Pacific Western Bank Ido Dotan General Counsel and Chief Administrative Officer 20+ years experience in corporate securities, M&A, and structured finance. Previously served as EVP of Carrington Mortgage Holdings Olivia Lindsay Chief Risk Officer 25+ years of experience in regulatory processes and controls, previously spent 15 years at MUFG Union Bank Steve Schwimmer Chief Information Officer 30+ years of experience in banking technology, previously served as the EVP, Chief Innovation Officer at PacWest Bancorp Sean Lynden President, Venture Banking Group 30+ years of banking and related experience. Previously served as President of Venture Banking Group for Pacific Western Bank Kim Tu EVP, Chief People Officer 15+ years of banking and financial services experience across Human Resources. Previously held HR leadership roles at Mr. Cooper and JPMorgan Chase Karen Hon Chief Accounting Officer & Deputy Chief Financial Officer 25+ years of finance & accounting experience, previously served as Chief Accounting Officer at Silicon Valley Bank Jared Wolff Chairman and Chief Executive Officer 30+ years of banking and law. Previously held senior executive positions with City National Bank (RBC) and PacWest Bancorp Joe Kauder Chief Financial Officer 30+ years of banking experience, previously served as EVP, CFO Wells Fargo Wholesale Banking Bill Rhodes Chief Internal Audit Officer 25+ years of banking and internal audit experience, previously served as CAE of Coastal Community Bank and Deputy CAE of Silicon Valley Bank Joe Rice Vice Chairman and Senior EVP 30+ years of banking and related experience. Previously served as Chief Credit Officer and Chief Operational Risk Officer at Wells Fargo Second Quarter 2026 Earnings | 35

 

Appendix

 

Non-GAAP Financial Information Tangible assets, tangible common equity, tangible common equity ratio, tangible book value per common share, adjusted net earnings, adjusted return on average assets (“ROAA”), return on average tangible common equity, adjusted return on average tangible common equity, pre-tax pre-provision (“PTPP”) income, adjusted noninterest expense, efficiency ratio, adjusted efficiency ratio, adjusted ACL ratio, and economic coverage ratio constitute supplemental financial information determined by methods other than in accordance with GAAP. These non-GAAP measures are used by management in its analysis of the Company's performance. Tangible assets is calculated by subtracting goodwill and other intangible assets from total assets. Tangible common equity is calculated by subtracting preferred stock and goodwill and other intangible assets, as applicable, from stockholders’ equity. Return on average tangible common equity is calculated by dividing net earnings available to common stockholders, after adjustment for amortization of intangible assets and goodwill impairment, by average tangible common equity. Adjusted return on average tangible common equity is calculated by dividing adjusted net earnings available to common stockholders, after adjustment for amortization of intangible assets and goodwill impairment, by average tangible common equity. Banking regulators also exclude goodwill and other intangible assets from stockholders' equity when assessing the capital adequacy of a financial institution. Adjusted net earnings is calculated by adjusting net earnings by unusual, one-time items. ROAA is calculated by dividing annualized net earnings by average assets. Adjusted ROAA is calculated by dividing annualized adjusted net earnings by average assets. PTPP income is calculated by adding net interest income and noninterest income (total revenue) and subtracting noninterest expense. Adjusted noninterest expense is calculated by subtracting customer related expenses from noninterest expense. Efficiency ratio is calculated by dividing noninterest expense (less intangible asset amortization and acquisition, integration and reorganization costs) by total revenue (the sum of net interest income and noninterest income, less gain (loss) on securities AFS). Adjusted efficiency ratio is calculated by dividing adjusted noninterest expense (less intangible asset amortization and acquisition, integration and reorganization costs, customer related expenses and any unusual one-item items) by adjusted total revenue (the sum of net interest income and noninterest income, less gain (loss) on securities AFS and customer related expense). Economic coverage ratio is calculated by dividing the allowance for credit losses adjusted for the impact of the credit- linked notes and unearned credit mark from purchase accounting by loans and leases held for investment. Core deposits is calculated as total deposits less brokered CDs and brokered non-maturity deposits. Core loan portfolio is calculated as total loans held for investment less premium finance loans, student loans, and Civic loans. Adjusted ACL ratio is calculated by dividing adjusted ACL for lower loss loan categories by adjusted loans and leases held for investment. Management believes the presentation of these financial measures adjusting the impact of these items provides useful supplemental information that is essential to a proper understanding of the financial results and operating performance of the Company. This disclosure should not be viewed as a substitute 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 on pages 38-47 provide reconciliations of the non-GAAP measures to financial measures defined by GAAP. Second Quarter 2026 Earnings | 37

 

Non-GAAP Reconciliation 1. Tangible common equity divided by tangible assets. 2. Total common equity divided by common shares outstanding. 3. Tangible common equity divided by common shares outstanding. 4. Common shares outstanding include non-voting common stock equivalents that are participating securities. ($ in thousands, except per share data) 2Q26 1Q26 4Q25 3Q25 2Q25 Tangible Common Equity Ratio Total stockholders' equity $3,410,146 $3,553,326 $3,541,277 $3,466,739 $3,426,843 Less: preferred stock 498,516 498,516 498,516 498,516 498,516 Total common equity 2,911,630 3,054,810 3,042,761 2,968,223 2,928,327 Less: goodwill and intangible assets 307,230 313,612 319,808 326,444 333,451 Tangible common equity $2,604,400 $2,741,198 $2,722,953 $2,641,779 $2,594,876 Total assets 35,030,953 34,724,241 34,797,442 34,012,965 34,250,453 Less: goodwill and intangible assets 307,230 313,612 319,808 326,444 333,451 Tangible assets $34,723,723 $34,410,629 $34,477,634 $33,686,521 $33,917,002 Total stockholders' equity to total assets 9.73% 10.23% 10.18% 10.19% 10.01% Tangible common equity ratio(1) 7.50% 7.97% 7.90% 7.84% 7.65% Book value per common share(2) $18.38 $19.80 $19.56 $19.09 $18.58 Tangible book value per common share (TBVPS)(3) $16.44 $17.77 $17.51 $16.99 $16.46 Common shares outstanding(4) 158,432,520 154,262,045 155,533,403 155,522,693 157,647,137 Second Quarter 2026 Earnings | 38

 

1. Effective tax rates of 28.00%, 25.14%, 26.86%, 27.34%, and 23.12%, used for the three months ended June 30, 2026, March 31, 2026, December 31, 2025, September 30, 2025, and June 30, 2025, respectively. 2. Annualized net (loss) earnings divided by average stockholders' equity. 3. Annualized adjusted net (loss) earnings available to common and equivalent stockholders for ROATCE divided by average tangible common equity. 4. Annualized adjusted net (loss) earnings available to common and equivalent stockholders for adjusted ROATCE divided by average tangible common equity. Non-GAAP Reconciliation Second Quarter 2026 Earnings | 39 ($ in thousands) 2Q26 1Q26 4Q25 3Q25 2Q25 Return on Average Tangible Common Equity ("ROATCE") Net (loss) earnings ($241,347) $71,952 $77,391 $69,629 $28,385 Adjustments: Intangible asset amortization 6,349 6,348 6,788 7,160 7,159 Tax impact of adjustment above (1) (1,778) (1,596) (1,823) (1,958) (1,655) Adjustment to net (loss) earnings 4,571 4,752 4,965 5,202 5,504 Adjusted net (loss) earnings for ROATCE (236,776) 76,704 82,356 74,831 33,889 Less: Preferred stock dividends 9,947 9,947 9,947 9,947 9,947 Adjusted net (loss) earnings available to common and equivalent stockholders for ROATCE ($246,723) $66,757 $72,409 $64,884 $23,942 Net (loss) earnings ($241,347) $71,952 $77,391 $69,629 $28,385 Adjustments: Intangible asset amortization 6,349 6,348 6,788 7,160 7,159 Provision for credit losses related to transfer of loans to held for sale - - - - 26,289 Total adjustments 6,349 6,348 6,788 7,160 33,448 Tax impact of adjustments above (1) (1,778) (1,596) (1,823) (1,958) (7,733) Income tax related adjustments - - - - 9,792 Adjustment to net (loss) earnings 4,571 4,752 4,965 5,202 35,507 Adjusted net (loss) earnings for adjusted ROATCE (236,776) 76,704 82,356 74,831 63,892 Less: Preferred stock dividends 9,947 9,947 9,947 9,947 9,947 Adjusted net (loss) earnings available to common and equivalent stockholders for adjusted ROATCE ($246,723) $66,757 $72,409 $64,884 $53,945 Average total stockholders' equity 3,545,141 3,548,700 3,494,157 3,437,335 3,430,143 Less: Average goodwill and intangible assets 311,068 317,215 323,295 330,277 337,352 Less: Average preferred stock 498,516 498,516 498,516 498,516 498,516 Average tangible common equity $2,735,557 $2,732,969 $2,672,346 $2,608,542 $2,594,275 Return on average equity (2) (27.31%) 8.22% 8.79% 8.04% 3.32% Return on average tangible common equity (3) (36.18%) 9.91% 10.75% 9.87% 3.70% Adjusted return on average tangible common equity (4) (36.18%) 9.91% 10.75% 9.87% 8.34%

 

1. Effective tax rates of 28.00%, 25.14%, 26.86%, 27.34%, and 23.12%, used for the three months ended June 30, 2026, March 31, 2026, December 31, 2025, September 30, 2025, and June 30, 2025, respectively. 2. Adjusted net (loss) earnings available to common and equivalent stockholders divided by weighted average common shares outstanding. 3. Annualized net (loss) earnings divided by average assets. 4. Annualized adjusted net (loss) earnings divided by average assets. Non-GAAP Reconciliation Second Quarter 2026 Earnings | 40 ($ in thousands, except per share amounts) 2Q26 1Q26 4Q25 3Q25 2Q25 Net (loss) earnings ($241,347) $71,952 $77,391 $69,629 $28,385 Adjustments: Provision for credit losses related to transfer of loans to held for sale - - - - 26,289 Total Adjustments - - - - 26,289 Tax impact of adjustment above(1) - - - - (6,078) Income tax related adjustments - - - - 9,792 Adjustment to net (loss) earnings - - - - 30,003 Adjusted net (loss) earnings ($241,347) 71,952 77,391 69,629 58,388 Less: Preferred stock dividends 9,947 9,947 9,947 9,947 9,947 Adjusted net (loss) earnings available to common and equivalent stockholders ($251,294) $62,005 $67,444 $59,682 $48,441 Weighted average diluted common shares outstanding 155,803 160,832 160,094 159,051 158,462 Diluted earnings per common share ($1.61) $0.39 $0.42 $0.38 $0.12 Adjusted diluted earnings per common share(2) ($1.61) $0.39 $0.42 $0.38 $0.31 Average total assets $34,644,930 $34,002,701 $33,752,500 $33,831,217 $33,764,149 Return on average assets ("ROAA")(3) (2.79%) 0.86% 0.91% 0.82% 0.34% Adjusted ROAA(4) (2.79%) 0.86% 0.91% 0.82% 0.69% Adjusted Net (Loss) Earnings

 

Non-GAAP Reconciliation Second Quarter 2026 Earnings | 41 ($ in thousands) 2Q26 1Q26 4Q25 3Q25 2Q25 PTPP (Loss) Income Net interest income $250,501 $251,617 $251,362 $253,444 $240,216 Add: Noninterest (loss) income (234,096) 35,328 41,571 34,285 32,633 Total revenue 16,405 286,945 292,933 287,729 272,849 Less: Noninterest expense (189,867) (181,391) (180,644) (185,684) (185,869) Pre-tax, pre-provision ("PTPP") (loss) income ($173,462) $105,554 $112,289 $102,045 $86,980

 

1. Noninterest expense used for efficiency ratio divided by total revenue used for efficiency ratio. 2. Noninterest expense used for adjusted efficiency ratio divided by total revenue used for adjusted efficiency ratio. Non-GAAP Reconciliation ($ in thousands) 2Q26 1Q26 4Q25 3Q25 2Q25 Adjusted Efficiency Ratio Noninterest expense $189,867 $181,391 $180,644 $185,684 $185,869 Less: Intangible asset amortization (6,349) (6,348) (6,788) (7,160) (7,159) Noninterest expense used for efficiency ratio $183,518 $175,043 $173,856 $178,524 $178,710 Less: Customer related expense (24,114) (23,737) (24,870) (26,227) (26,577) Noninterest expense used for adjusted efficiency ratio $159,404 $151,306 $148,986 $152,297 $152,133 Net interest income $250,501 $251,617 $251,362 $253,444 $240,216 Noninterest (loss) income ($234,096) 35,328 41,571 34,285 32,633 Total Revenue $16,405 $286,945 $292,933 $287,729 $272,849 Add: Loss on securities AFS 256,749 - - - - Total revenue used for efficiency ratio $273,154 $286,945 $292,933 $287,729 $272,849 Less: Customer related expense (24,114) (23,737) (24,870) (26,227) (26,577) Total revenue used for adjusted efficiency ratio $249,040 $263,208 $268,063 $261,502 $246,272 Noninterest expense to total revenue 1157.37% 63.21% 61.67% 64.53% 68.12% Efficiency ratio(1) 67.18% 61.00% 59.35% 62.05% 65.50% Adjusted efficiency ratio(2) 64.01% 57.49% 55.58% 58.24% 61.77% Second Quarter 2026 Earnings | 42

 

($ in thousands) 2Q26 1Q26 4Q25 3Q25 2Q25 Noninterest expense $189,867 $181,391 $180,644 $185,684 $185,869 Less: Customer related expense (24,114) (23,737) (24,870) (26,227) (26,577) Adjusted noninterest expense $165,753 $157,654 $155,774 $159,457 $159,292 Average assets $34,644,930 $34,002,701 $33,752,500 $33,831,217 $33,764,149 Noninterest expense to average total assets 2.20% 2.16% 2.12% 2.18% 2.21% Adjusted noninterest expense to average total assets 1.92% 1.88% 1.83% 1.87% 1.89% Adjusted Noninterest Expense to Average Total Assets Non-GAAP Reconciliation Second Quarter 2026 Earnings | 43

 

($ in millions) 2Q26 1Q26 2Q25 Total Deposits $28,121 $27,322 $27,528 Less: Brokered CDs (2,591) (2,562) (2,312) Less: Brokered Non-maturity Deposits (227) (226) (565) Total Core Deposits $25,303 $24,534 $24,652 Core Deposits Non-GAAP Reconciliation Second Quarter 2026 Earnings | 44

 

Non-GAAP Reconciliation ($ in millions) 2Q26 1Q26 Total Loans HFI $24,211 $24,780 Discontinued Area Loans: Less: Premium Finance Loans (356) (408) Less: Student Loans (238) (250) Less: Civic Loans (24) (27) Total Discontinued Area Loans (618) (685) Total Core Loans $23,592 $24,095 Core Loans Second Quarter 2026 Earnings | 45

 

Non-GAAP Reconciliation 1. Unearned credit mark from purchase accounting estimated by using the same pro rata split between the credit and yield marks associated with the non-PCD loans (purchased loans without credit deterioration at the time of the purchase) at the time of the acquisition. 2. Credit-linked notes loss coverage equal to 5% of the unpaid principal balance of the pledged loans. 3. Allowance for credit losses divided by loans and leases held for investment. 4. Adjusted allowance for credit losses divided by loans and leases held for investment. ($ in thousands) 2Q26 1Q26 4Q25 3Q25 2Q25 Allowance for credit losses ("ACL") $276,240 $276,521 $280,533 $270,722 $258,565 Add: Unearned credit mark from purchase accounting (1) 12,920 14,315 15,865 17,496 19,199 Add: Credit-linked notes(2) 105,026 104,988 108,413 110,539 112,887 Adjusted allowance for credit losses $394,186 $395,824 $404,811 $398,757 $390,651 Loans and leases held for investment $24,210,846 $24,780,347 $25,032,679 $24,110,642 $24,245,893 ACL to loans and leases held for investment(3) 1.14% 1.12% 1.12% 1.12% 1.07% Economic coverage ratio(4) 1.63% 1.60% 1.62% 1.65% 1.61% Economic Coverage Ratio Second Quarter 2026 Earnings | 46

 

Non-GAAP Reconciliation 1. Lower loss loan categories include warehouse lending loans, equity fund loans, lender finance loans, and residential mortgage loans. 2. ACL divided by loans and leases held for investment. 3. Adjusted ACL for lower loss loan categories (includes SFR, Warehouse, Fund Finance, and Lender Finance) divided by adjusted loans and leases held for investment. ($ in thousands) 2Q26 Allowance for credit losses ("ACL") $276,240 Less: ACL on lower loss loan categories: ACL on warehouse lending loan portfolio (4,030) ACL on equity fund loan portfolio (461) ACL on lender finance loan portfolio (6,450) ACL on single family residential mortgage loans (6,034) Adjusted ACL for total lower loss loan categories(1) $259,266 Loans and leases held for investment $24,210,846 Less: Lower loss loan categories: Warehouse lending loan portfolio (1,680,730) Equity fund loan portfolio (1,504,497) Lender finance loan portfolio (2,017,200) Single family residential mortgage loans (3,769,706) Adjusted loans and leases held for investment(1) $15,238,714 ACL to loans and leases held for investment(2) 1.14% Adjusted ACL excluding SFR loans 1.32% Adjusted ACL excluding SFR and warehouse loans 1.42% Adjusted ACL for total lower loss loan categories to adjusted loans and leases held for investment(3) 1.70% Adjusted ACL for Lower Loss Loan Categories Ratio Second Quarter 2026 Earnings | 47

 

Source: View Original Filing on SEC EDGAR

Filing Exhibits & Attachments

6 documents

Press Releases

Other Documents