California Bancorp · NASDAQ:BCAL
California Bancorp — California BanCorp \ CA — Q3 2024 Earnings Presentation
33 slides from California Bancorp's earnings presentation, Oct 29, 2024
Slide 1: Investor Presentation September 30, 2024
Investor Presentation September 30, 2024 CALIFORNIA CALIFORNIA BANCORP BANK OF COMMERCE
Slide 2: Forward-Looking Statements
Forward-Looking Statements ‘CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS, In addition to historical information, this release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to expectations, bel
Slide 3: Company Overview
Company Overview
Slide 4: Investment Highlights
Investment Highlights Market and Footprint + California is the world's 5!" largest economy and the largest banking market in the U.S.' + Bank's footprint covers the best small fo middle-market business banking markets in California (1.7 million small to medium-sized businesses in the counties we ser
Slide 5: California BanCorp at a Glance
California BanCorp Ata Glance Branch Footprint $461M Market Cap! 4 Bank Acquisitions? 1 MOE San Diego Headquarters 5-Y1 Deposit Deposits? Caen 1. Markel data os of Qctober 19, 2024 2. Over the pas! 10 years 3. Asof Soplember 30, 2024 5 4 Compound annual growth rate [CAGE] over tive-yeox period ended
Slide 6: Attractive Market Position
Attractive Market Position California is the Largest Banking Market in the United States $3.9T $m 39MM 1.7MM California GDP Largest economy in 2023 Population Small Businesses the world behind. Germany ang cheas BCAL's Southern California Footprint $1.6T 16th 23MM 1MM Combined GDP Largest economy in
Slide 7: High Growth Franchise
High Growth Franchise % Since 2019, total assets have grown organically and through strategic October 2021 ‘Acquired Bank of Santa Clarita ($425MM Assets) November 2020 David Rainer joined BCAL M&A by $3.5 billion, or 426%, powered by a dedicated and accomplished team. 2,284 May 2020 $2,260 . Acauir
Slide 8: Experienced Leadership Team
Experienced Leadership Team David I. Rainer Steven Shelton Richard Hernandez Executive Chairman Chief Executive Officer President Banking Experience: Banking Experience: Banking Experience: > 40 Years > 40 Years > 25 Years Thomas Dolan Chief Financial Officer Banking Experience: > 40 Years Michele W
Slide 9: Our Vision for a Premier Banking Franchise
Our Vision for a Premier Banking Franchise Strong Leadership op Growth Strategy + Experienced teams living and working in + Provide expertise in commercial and their respective California communities, industrial, and commercial real estate lending and actively involved in local to small and middle-m
Slide 10: Financial Highlights
Financial Highlights
Slide 11: Announcement Estimates vs Updated Estimates
Announcement Estimates vs Updated Estimates Key Accounting Marks Estimate Estimate Pb Increase in goodwill is due primarily to lower net asset acquired offset by lower purchase consideration at at (in millions, except per share data) SIT UIE & Capital Ratio variance is due primarily to lower equity
Slide 12: 3Q24 Balance Sheet
3Q24 Balance Sheet Assets $614. ge . . edie pias —* Stfong cash position with multiple | Loans Held for Sle 33,704 sources of quickly available liquidity Gross Loans, (excluding HFS loans) 3,199,714 7 ( . oe ys acini oS Maintain prudent underwriting Goodwill and Other Intangibles 135,546 standards O
Slide 13: 3Q24 Income Statement
3Q24 Income Statement For the three and nine months ended September 30, 2024 ‘Smonths ended 9 months ended Income Statement (sin 000s) Interest Income Loans $ 47528 § 105,169 Securities 1487 4,129 Other interest income 4912 7,942 Total Interest Income. 34127 117,240 Interest expense Deposits 16,160
Slide 14: Net Interest Margin
Net Interest Margin Yield on Earning Assets tt nth ot. Total loans Taxable debt securities Tax-exempt debt securities! Deposits in other financial institutions Fed fund sold/resale agreements Restricted stock investments and other bank stock Total interest-eaming assets Total noninterest-eaming asse
Slide 15: Low-Cost Core Deposits
Low-Cost Core Deposits Deposit Mix and Growth at quarter ended: 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 9/30/2023 32/31/2023 3/31/2024 6/30/2024 9/30/2024 = Noninterest-bearing Demand money Market & Savings Interest Bearing Checking mICS/RAT Deposits, Brokered Time Deposits Time Deposits 88.7% C
Slide 16: Significant Access to Liquidity & Funding Capacity
Significant Access to Liquidity & Funding Capacity Ea As of 9/30/2024 (Bin millions) coun 5 oud § _ 5 —_ Significant Available Liquidity AFS Securities 159.3 - 159.3 FHLB 786.1 122.5 663.6 = — Fed DW 446.4 . 446.4 — Other Sources 121.0 = 121.0 Total $ 2,127.2 $ 122.5 $ 2,004.7 50035 » Ample access f
Slide 17: Loan Portfolio
Loan Portfolio Total Loans | ($MM), = ichihe pered ended [contractual Maturity Summary for the next 3 years as of September 30, 2024 ($ in millions) <1year 1.2 Years >2-3 Years $3,000 % of total % of total % of total $ toans__$ Loans _$ Loans. Construction & land development $222.1 6.9% $200 06% = $
Slide 18: Diverse Loan Portfolio
Diverse Loan Portfolio Total Loan Portfolio Commercially Focused | Relationship Based Other0.9% Multifamily 1-4 SFR 7.8% _ Ah. Sponsor f 5 Total Loans $3.23 billion CRE - Others 5.9% CRE - Special Purpose 3.6% Ene Restaurant oe CRE - Mi m1 Construction & land Dev 7.7% Total CRE $by Location 4, aso O
Slide 19: Low LTV Commercial Real Estate Loans
Low LTV Commercial Real Estate Loans Total CRE! Distribution by LTV 2, > 70% >65% to 70% 100% om >60% 10 65% 1% aN 90% 7% 780 oO <50% 80% CRE 10.87%, 54% cre, 42% 70% 250% 10 55% —~ 13% 60% No. of Weighted Avg. isin ition) Loans __Balance>_Average Loan i uv 50% CRE ~ Industrial 278 $5157 $19 49% a C
Slide 20: CRE Office and Medical/Dental Office by Location
CRE Office and Medical/Dental Office by Location 5) 30,202: Out of State 2.8% <$05 51 $128 $0.3 41% 3$0.5-$2 63 $564 $0.9 46% CalifMiia - Los Angeles >$2-$5 7 $513 $3.0 53% HESS >$5-$10 7 $48.0 $6.9 58% >$10- $20 4 $623 $15.6 44% > $20 1 $249 $24.9 55% CRE - Office 143 $255.7 $1.8 50% California - B
Slide 21: Multifamily Loans
Multifamily Loans Out of State, California - Bay Ared: No. of Average Weighted Loans Balance 2 Loan Size__Avg. LTV 120% 22 $6.7 $0.3 34% 10 $73.8 $7.4 57% California 37 $46.5 $1.3 46% | >$5- $10 26 $83.8 $3.2 57% >$10 - $20 3 $413 $13.8 58% Angeles. Multifamily Loans 98 $252.1 $2.6 55% 7 California
Slide 22: Loans Held for Investment by Risk Category
Loans Held for Investment by Risk Category Special Pass Mention Substandard’ Doubtful __Loss Nonaccruat Total (in Thousands, September 30, 2024 Construction and Land Development $ 232,902 $ - ¢ 5973 $ - $ - §$ 9,659 $ 247,934 Real Estate - Other: 1-4 Family Residential 148,798 847 - 2,895 152,540 Mu
Slide 23: Credit Profile
Credit Profile Adequate Reserv: NPAs / Assets 1.000% ‘Nonaccrual Loans 7 0.84% 1-4 Family $- § - 5S - 5 - $2895 0.800% 0.55% 0.68% CRE & Multifamily 14272 13,004 61534696 9.432 —g gaqog Construction - - - = 9,105 Consumer : - - - ~ 0.400% Commercial : : : = 4902 Total Nonacerual 314272 $13,004 $6,15
Slide 24: Allowance for Credit Losses
Allowance for Credit Losses as of and for the Three Months Ended September 30, 2024 1.467% 14 som Jul3T, 2024. $18,523% $1,162 s1,n99K __ $4899K__ $53,552 isi) (162%) (61,2820) (62068) $11,203K balance 20" “Bing > At merger close on July 31, 2024, $11.2 million initial one-time allowance for PCD loa
Slide 25: Noninterest Expense and Total Revenue
$40.0 $350 $300 $250 $200 $150 $100 $50 300 Noninterest Exoense and Total Revenue Noninterest Expense ($MM) for the quarter ended: 98.9% 100.0% 40 s00% 3 61.4% 70.0% 30 o% 0.588 24.41 = —% $22.5 s00% 20 00% ¢ 1s , $18.5 300% $148 $15.3 $14.5 200% x» 100% 5 3023 4023 1024 2024 3024 me Noninterest exp
Slide 26: Income Metrics
Income Metrics Net Income (Loss)* ($MM) Tangible Book Value Per Share (TBVPS)' $100 1.12% 15.00 20.00% ‘a 1.50% 10.92% 7. as $0.0 toe $10.00 0.00% $10.0 ee $00 10.00% 150% 20.00% $20.0 1,82%.2.00%, -20.21% 3023 4023 1024 2024 3024 $0.00 30.00% 3023 axa sa24 raz 3a24 mem Netincome —=ROAA mmm reves ——
Slide 27: Strong Capital Base
Strong Capital Base Tangible Common Equity Ratio! Tier 1 Ratio** 1138 pay ay 12.60% BB ag 101% 103% 105% 10.7% 1m 11% yo9% 314% 1.30% 92% | [ [ | | 2022 4022 1023 2023 3023 4023 124 2024 sa 3022 42 «1023-2023. -3023 «4023. 1GM_— 2a 3024 Total Risk-Based Capital Ratio?* Leverage Ratio? 142% 14.30% 13
Slide 28: Appendix
Appendix
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation Pre-tax, pre-provision income and adjusted pre-tax, pre-provision income are non-US. GAAP financial measures derived from U.S. GAAP-based amounts We calculate pre-tax, pre-provision income by excluding income tax and provision for credit losses from net income. We calculate a
Slide 30: Non-GAAP Reconciliation
Non-GAAP Reconciliation Efficiency ratio and adjusted efficiency ratio are non-U.S. GAAP financial measures derived from U.S. GAAP-based amounts. The efficiency ratio represents the ratio of noninterest expense to the sum of net interest income and total noninterest income. The adjusted efficiency r
Slide 31: Non-GAAP Reconciliation
Non-GAAP Reconciliation Tangible common equity to tangible assets (the "tangible commen equity ratio’) and tangible book vaive per share are non-US. GAAP financial measures derived from U.S. GAAP-based amounts. We calculate the tangible common equity ratio by excluding the balance of intangible asse
Slide 32: Non-GAAP Reconciliation
Non-GAAP Reconciliation The following table presents a reconciliation of non-GAAP financial measures to GAAP measures for: (1) adjusted net income, (2) average tangible common equity, (3) adjusted return on average assets, (4) adjusted return on average equity, (5) return on average tangible common
Slide 33: California BanCorp
CALIFORNIA BANCORP CALIFORNIA BANK OF COMMERCE
California BanCorp \ CA — Q3 2024 Earnings Presentation on 6ix