Mechanics Bancorp · NASDAQ:MCHB
Mechanics Bancorp — Q1 2026 Earnings Presentation
27 slides from Mechanics Bancorp's earnings presentation, Apr 30, 2026
Slide 1: Mechanics Bancorp First Quarter Earnings Presentation
Mechanics Bancorp First Quarter Earnings Presentation April 30, 2026 Seattle, WA San Francisco, CA Los Angeles, CA 1
Slide 2: Disclaimer
Disclaimer FORWARD-LOOKING STATEMENTS AND OTHER This presentation and statements made by representatives of Mechanics Bancorp (“Mechanics” or the “Company”) during the course of this presentation include “forward- looking statements” within the meaning of the Private Securities Litigation Reform Act
Slide 3: Disclaimer (cont'd)
Disclaimer (cont’d) FORWARD-LOOKING STATEMENTS AND OTHER (cont’d) For further discussion of such factors, see the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2025, Quarterly Reports on Form 10-Q and other reports that we have filed with the Securities and
Slide 4: Mechanics Bancorp 1st Quarter 2026 Financial Highlights
Mechanics Bancorp 1st Quarter 2026 Financial Highlights Condensed Balance Sheet 1st Quarter 2026 Financial Highlights ($ in millions, except per share data) Q1 '26 Q4 '25 Q1 '25 Cash & Investments $ 5,780 $ 6,410 $ 5,802 Net Loans, including HFS 13,700 14,030 9,341 ▪ Mechanics Bancorp reported net i
Slide 5: Mechanics Bancorp Strategic Update
Mechanics Bancorp Strategic Update ➢ We successfully converted all Legacy HomeStreet customers onto our core banking platform the final week of March ➢ Major milestone achieved thanks to a tremendous amount of planning and hard work from all our employees ➢ We will substantially complete our merger
Slide 6: Mechanics Bancorp Overview
Mechanics Bancorp Overview 705 Everett Mechanics Bancorp Overview WA Seattle #4 / #4 $21.4bn 166 90 Tacoma 90 CA / West Coast market Seattle Olympia Total assets Branches 82 share by deposits1 5 182 5 Vancouver Portland 84 Key Stats vs. $10–100bn public U.S. banks 405 As of MRQ: As of MRQ: As of MRQ
Slide 7: Low-Cost Deposits Deliver Superior Returns with Low-Risk Assets
Low-Cost Deposits Deliver Superior Returns with Low-Risk Assets LOW-COST LOW-RISK SUPERIOR DEPOSIT BASE ASSET STRATEGY RISK-ADJUSTED RETURNS Cost of Deposits of $10–100bn U.S. public banks RWA / Assets of $10–100bn U.S. public banks Creates substantial capacity to deploy capital 59% ~50% Rank: #10 o
Slide 8: Compelling Investment Thesis
Compelling Investment Thesis ✓ Premier community bank in attractive West Coast markets (#4 CA and #4 West Coast bank by deposits¹) ✓ Leading profitability (~17% 2027E ROATCE) despite low-risk assets (59% RWA / Assets) ✓ Simple and efficient business model – straightforward asset strategy powered by
Slide 9: First Quarter 2026 Financial Drivers
First Quarter 2026 Financial Drivers 9
Slide 10: Net Interest Income & Margin
Net Interest Income & Margin Average Earning Assets and NIM Trends 1 Key Highlights ($ in billions) 3.61% ➢ Q1‘26 net interest income decreased $3.9 million, or 3.50% 2.2%, to $179.0 million from $183.0 million for Q4‘25 3.45% 3.44% 3.33% $20.7 $20.1 ➢ Net interest margin increased 11 bps during the
Slide 11: Non-Interest Income
Non-Interest Income Non-Interest Income Trend Key Highlights ($ in millions) $109.8 ➢ Q1’26 non-interest income decreased $57.5 million, or 73%, to $21 million from $78.5 million in Q4’25 $78.5 $90.4 ➢ Q4’25 includes an adjustment to the bargain $55.1 purchase gain recognized on the HomeStreet acqui
Slide 12: Non-Interest Expense
Non-Interest Expense Non-Interest Expense Trend 1, 2 Key Highlights ($ in millions) $163.3 ➢ Q1’26 non-interest expense increased $0.9 million, or 62.6% 61.6% 0.7%, to $130.4 million from $129.5 million in Q4’25 57.8% 59.0% $129.5 $130.4 $63.9 $3.5 $4.8 ➢ Merger-related costs during Q1‘26 were $4.8
Slide 13: Loan Portfolio Overview
Loan Portfolio Overview Loan Balance and Yield Trends 1 Key Highlights ($ in billions) ➢ Q1‘26 loan interest income decreased $12.9 million, or 6.7%, to $181.2 million from $194.1 million in Q4‘25 14.6 14.2 14.4 13.9 14.0 ➢ Loan yields decreased 9 bps in Q1‘26, driven by 5.34% slightly lower contrac
Slide 14: Granular, Low-Risk Commercial Lending with a Multifamily Focus
Granular, Low-Risk Commercial Lending with a Multifamily Focus ✓ Mechanics Bank’s commercial lending is highly granular and well-diversified across both collateral types and geography ✓ Focus on multifamily lending, with an emphasis on Southern California (54% of total multifamily) ▪ Average multifa
Slide 15: Asset Quality
Asset Quality NCOs / Average Loans NPAs / Assets 0.40% 0.38% 0.02% 0.29% 0.32% 0.32% 0.25% 0.02% 0.23% 0.01% 0.04% 0.02% 0.23% 0.02% 0.14% 0.37% 0.12% 0.31% 0.12% 0.03% 0.26% 0.28% 0.21% 0.23% 0.06% 0.15% 0.12% 0.11% 0.06% Q1 '25 Q2 '25 Q3 '25 Q4 '25 Q1 '26 Q1 '25 Q2 '25 Q3 '25 Q4 '25 Q1 '26 Auto NC
Slide 16: Securities Portfolio
Securities Portfolio Securities Balance and Yield Trends Key Highlights ($ in billions) 4.04% 3.97% ➢ Q1‘26 securities interest income increased $3.5 million, 3.88% 3.86% or 7%, to $53.1 million from $49.5 million in Q4’25 driven by higher yields 3.76% 5.4 5.4 5.1 5.3 ➢ The yield on the securities p
Slide 17: Deposits Overview
Deposits Overview Deposit Balance and Cost Trends Key Highlights ($ in billions) 19.5 ➢ Q1‘26 deposit interest expense decreased $10.7 19.0 19.2 million, or 15%, to $58.3 million from $69.0 million for 1.45% 1.43% 18.2 18.5 1.39% Q4 ’25 1.32% 1.28% 15.8 ➢ Cost of deposits decreased 15 bps in Q1’26,
Slide 18: Mechanics Bank Deposit Stratification at 3/31/2026
Mechanics Bank Deposit Stratification at 3/31/2026 Mechanics Bank Deposits ($ in millions, except account data) Avg Relationship Number of Deposit Deposit Account Weighted Segment Accounts Balance ($) Balance (%) Size ($) Age (yrs) Cost1 (%) Consumer 355,638 9,192 50% 25,848 19.6 1.19% Business 69,5
Slide 19: Capital and Liquidity Update
Capital and Liquidity Update Capital Ratios Trend (%) 1 Key Highlights 19.1 17.8 18.3 16.9 16.3 16.2 ➢ Mechanics Bank’s capital ratios exceed minimums to 15.6 13.4 14.1 13.9 be “well-capitalized” and meet all regulatory capital requirements and internal policy limits 9.9 10.2 10.3 8.7 8.7 ➢ Availabl
Slide 20: Appendix
& Mechanics Appendix
Slide 21: Details on Mechanics Bank Standalone CRE Portfolio
Details on Mechanics Bank Standalone CRE Portfolio CRE by collateral ($mm) % of Avg Total Non-owner Owner Total Collateral Type Balance Owner-occupied LTV1 Size classified classified classified NPL Multifamily $5,292 0% 56% $3.8 $122 $122 $0 $0 Re tail 705 9% 49% 3.3 13 12 1 0 Office 646 22% 54% 2.1
Slide 22: Details on Mechanics Bank Standalone CRE Portfolio (cont'd)
Details on Mechanics Bank Standalone CRE Portfolio (cont’d) CRE by collateral and reset/maturity ($mm) Balance maturing First rate resets next Maturing & rate reset Collateral Type Balance next 24 months 24 months % of loans Multifamily $5,292 $99 $903 19% Re tail 705 286 79 52% Office 646 220 38 40
Slide 23: Non-GAAP Financial Measures and Reconciliations
Non-GAAP Financial Measures and Reconciliations Return on Average Equity and Return on Average Tangible Equity ($ in thousands) Quarter Ended Return on Average Equity and March 31, December 31, March 31, 1 Return on Average Tangible Equity Ref 2026 2025 2025 Net Income (a) $ 44,090 $ 111,188 $ 43,79
Slide 24: Non-GAAP Financial Measures and Reconciliations (cont'd)
Non-GAAP Financial Measures and Reconciliations (cont’d) Efficiency Ratio ($ in thousands) Quarter Ended March 31, December 31, September 30, June 30, March 31, Efficiency Ratio 1 Ref 2026 2025 2025 2025 2025 Noninterest expense (e) $ 130,427 $ 129,510 $ 163,329 $ 91,080 $ 85,638 Less: intangibles a
Slide 25: Non-GAAP Financial Measures and Reconciliations (cont'd)
Non-GAAP Financial Measures and Reconciliations (cont’d) Book Value and Tangible Book Value Per Share ($ in thousands, except shares and per share data) As of March 31, December 31, March 31, Book Value and Tangible Book Value P er Share Ref 2026 2025 2025 Total shareholders’ equity (i) $ 2,791,392
Slide 26: Non-GAAP Financial Measures and Reconciliations (cont'd)
Non-GAAP Financial Measures and Reconciliations (cont’d) Common Equity Ratio and Tangible Common Equity Ratio ($ in thousands) As of Common Equity Ratio and March 31, December 31, March 31, Tangible Common Equity Ratio Ref 2026 2025 2025 Total shareholders’ equity (m) $ 2,791,392 $ 2,862,375 $ 2,374
Slide 27: Non-GAAP Financial Measures and Reconciliations (cont'd)
Non-GAAP Financial Measures and Reconciliations (cont’d) Core Net Income ($ in thousands) Quarter Ended March 31, 2026 As Non-Core Core Core Net Income Ref Reported Adjustments Net Income Net Interest Income before Provision $ 179,045 $ - $ 179,045 Provision / (Reversal of Provision) 1 7,767 6,530 1