Company: MCHB
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001518715-25-000110
Chunk: 109

Company: Mechanics Bancorp
Filing Date: 2025-08-06
Form: 10-Q
Item: Item 2
Chunk 109
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3 million during the six months ended June 30, 2024. As excess liquidity can reduce the Company’s earnings and returns, the Company manages its cash positions to minimize the level of excess liquidity and does not attempt to maximize the level of cash and cash equivalents. The following discussion highlights the major activities and transactions that affected our cash flows during these periods.

Cash flows from operating activities

The Company's operating assets and liabilities are used to support our lending activities, including the origination and sale of mortgage loans. For the six months ended June 30, 2025, net cash of $32 million was used in operating activities, as cash generated from operations was offset by cash used to fund LHFS in excess of proceeds from the sale of loans and increases in trading securities. For the six months ended June 30, 2024, net cash of $30 million was used in operating activities, as cash generated from operations was offset by cash used to fund LHFS in excess of proceeds from the sale of loans and increases in other assets

Cash flows from investing activities

The Company's investing activities primarily include AFS investment securities and loans originated as held for investment. For the six months ended June 30, 2025, net cash of $343 million was provided by investing activities primarily from principal repayments on AFS securities and by LHFI principal repayments, net of originations. For the six months ended June 30, 2024, net cash of $123 million was provided by investing activities primarily from principal repayments on AFS securities and by LHFI principal repayments, net of originations, partially offset by net FHLB stock purchases.

Cash flows from financing activities

The Company's financing activities are primarily related to deposits and proceeds from borrowings. For the six months ended June 30, 2025, net cash of $516 million was used in financing activities, primarily due to a decrease in brokered certificates of deposit. For the six months ended June 30, 2024, net cash of $90 million was used in financing activities, primarily due to a decrease in deposits, partially offset by an increase in borrowings.

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Off-Balance Sheet Arrangements

In the normal course of business, we are a party to financial instruments that carry off-balance sheet risk. These financial instruments (which include commitments to originate loans and commitments to purchase loans) include potential credit risk in excess of the amount recognized in the accompanying consolidated financial statements. These transactions are designed to (1)