Company: MCHB
Filing Date: 2025-04-15
Form Type: ARS
Source: 0001518715-25-000069
Chunk: 9

Company: Mechanics Bancorp
Filing Date: 2025-04-15
Form: ARS
Chunk 9
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0.53 % Nonperforming assets to total assets 0.71 % 0.45 % Nonperforming assets $ 57,814 $ 42,643 Regulatory Capital Ratios: Bank Tier 1 leverage ratio(3) 7.30 % 8.50 % Total risk-based capital 13.02 % 13.49 % Common equity Tier 1 capital 12.27 % 12.79 % Company Tier 1 leverage ratio(3) 5.77 % 7.04 % Total risk-based capital 12.23 % 12.84 % Common equity Tier 1 capital 8.62 % 9.66 % (1) Tangible book value per share and tangible common equity to tangible assets are non-GAAP financial measures. For a reconciliation to the nearest comparable GAAP financial measure, see “Non-GAAP Financial Measures” elsewhere in this Management's Discussion and Analysis of Financial Condition and Results of Operations. (2) This ratio excludes balances insured by the FHA or guaranteed by the VA or SBA. (3) Due to the timing of our loan sale at the end of December 2024, our Tier 1 leverage regulatory capital ratios, which are based on average assets for the quarter, were temporarily suppressed. If the $990 million loan sale had occurred at the beginning of the fourth quarter, average assets for the fourth quarter for the Company and the Bank would have been approximately $8.3 billion and the Tier 1 leverage ratio for the Company and the Bank as of December 31, 2024 would have been approximately 6.45% and 8.15%, respectively. 9

Results of Operations 2024 Compared to 2023 Non-core amounts: For 2024, non-core items include an $88.8 million loss on the sale of $990 million of multifamily loans, $53.3 million valuation allowance for deferred tax assets and $3.4 million of merger related expenses. During 2023, non-core items include a $39.9 million goodwill impairment charge and $1.5 million of merger related expenses. General: Our net loss and loss before income taxes were $144.3 million and $120.5 million, respectively, in 2024, as compared to $27.5 million and $32.8 million, respectively, in 2023. Our core net loss and core loss before income taxes, which exclude the loss on the sale of multifamily loans, the impact of