Banc Of California, Inc. · NYSE:BANC
Banc Of California — Q3 2016 Earnings Presentation
15 slides from Banc Of California's earnings presentation, Oct 19, 2016
Slide 1: 2016 Third Quarter Earnings Investor Presentation
October 19, 2016 2016 Third Quarter Earnings Investor Presentation Exhibit 99.2
Slide 2: Forward-looking Statements
Forward-looking Statements When used in this presentation and in documents filed with or furnished to the Securities and Exchange Commission (the “SEC”), or other public shareholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases
Slide 3: Compelling Third Quarter Financial Results
$11.2 billion in Assets $1.1 billion deposit growth in 3Q >25% QoQ reduction in nonperforming and delinquent loan ratios Dollars in billions 2 Dollars in millions 3 Adjusted efficiency ratio for 3Q16 including the pre-tax effect of investments in alternative energy partnerships 1.3% ROAA in 3Q 20% R
Slide 4: Track-Record of Consistently Improving Financial Results
Diluted 2 Dollars in million 3 Return on Assets and Return on Tangible Common Equity based on average assets and average tangible common equity, respectively, over stated time periods Track-Record of Consistently Improving Financial Results Business Model Proving to be Highly Scalable and Profitable
Slide 5: Accelerating Profitability in Core Businesses
+57% Accelerating Profitability in Core Businesses Consistent Growth in Net Interest Income Complemented by Strong Mortgage Banking Performance Dollars in millions 2 Business Segment Pretax Income inclusive of intra-company allocations; excludes unallocated Corporate / Other interest expense. Financ
Slide 6: Scale Resulting in Increased Efficiencies and Productivity
Scale Resulting in Increased Efficiencies and Productivity Continue to Target 40% Marginal Efficiency Ratio1 ($ in millions) Assets / FTE Business Segment Noninterest Expense / Total Assets 4.9% 4.5% 4.0% 4.0% 3.8% Adjusted efficiency ratio for 3Q16 including the pre-tax effect of investments in alt
Slide 7: Strategic Actions During Quarter Enhance Franchise Value
Strategic Actions During Quarter Enhance Franchise Value Reduction of Risk and Volatility Enable More Scalable Growth Sale of Non-Performing, Delinquent and TDR Loans to meaningfully improve credit quality and reduce credit risk. Pruning of businesses and portfolios with higher credit risk including
Slide 8: Record 3Q Deposit Growth Helped to Reduce Borrowings
+67% Total Deposits ($ in billions) Record 3Q Deposit Growth Helped to Reduce Borrowings Strong Liquidity Position Key to Continued Long Term Growth Record quarterly deposit growth of $1.1 billion $700 million of commercial banking segment deposit growth during Q3 FHLB borrowings reduced by $160 mil
Slide 9: Loan Production Continues to be Robust
Loan Production by Business Segment Loan Production Continues to be Robust On Track to Exceed 2016 Production Target of $8 Billion ($ in millions) +44% Total 3Q loan production of $2.6 billion, including $1.1 billion of commercial banking segment production Commercial banking loan production up 51%
Slide 10: Loan Growth Driven by Commercial Lending
Loan Growth Driven by Commercial Lending Continuing to Add Talented Commercial Banking Teams Held for investment loan balances; totals may not equal 100% as Consumer loans represented (2%) C&I Loans include C&I, SBA and Lease loans Total commercial loans now represent 59% of held for investment loan
Slide 11: Portfolio Management Strengthening Asset Quality
Portfolio Management Strengthening Asset Quality Proactively Reducing Risk During Period of Strong Credit Performance and Tight Credit Spreads Change QoQ B / (W) Change YoY B / (W) NPAs / Assets 29% 48% Total Delinquent Loans / Gross Loans 26% 20% Non-Accrual TDRs 82% 74% ALLL / NPLs 37% 48% Selecti
Slide 12: Asset Quality Remains Strong and Stable
Asset Quality Remains Strong and Stable Nonperforming Assets to Total Asset Ratio Improved Significantly and at Lowest Level in Over 5 Years 3Q 2015 4Q 2015 1Q 2016 2Q 2016 3Q 2016 % Change YoY NPAs / Assets 0.62% 0.56% 0.46% 0.45% 0.32% (48%) NPAs / Equity 7.0% 7.1% 5.1% 4.8% 3.7% (47%) ALLL / NPLs
Slide 13: Strong Capital Ratios and Liquidity
Strong Capital Ratios and Liquidity Total Liquidity Increased by $4 Billion Year over Year BANC Liquidity1 BANC Capital Ratios Dollars in millions
Slide 14: Banc of California's Business Model is Winning
Dollars in billions 2 Dollars in millions 3 Diluted 4 Normalized to assume full 40% tax rate Deposits1 Earnings per Share3 Net Income2 Assets1 4 YTD 2016 Annualized Annualized CAGR +66% CAGR +68% CAGR +121% CAGR +48% Banc of California’s Business Model is Winning Market Leading Earnings and Asset Gr
Slide 15: On Pace to Exceed 2016 Earnings Guidance
Metric FY 2016 Guidance YTD 2016 Actual On Target ROATCE 15% 16.8% ü ROAA 1%+ 1.1% ü Efficiency Ratio1 65% – 70% 67% ü Earnings Per Share2 $1.85+ $1.40 ($1.87 annualized) ü “Given our strong year to date results, we are updating our 2016 earnings per share guidance to at least $1.85 per share, an in