Company: BANC-PF
Filing Date: 2025-03-03
Form Type: 10-K
Source: 0001628280-25-009438
Chunk: 69

Company: BANC OF CALIFORNIA, INC.
Filing Date: 2025-03-03
Form: 10-K
Item: Item 7A
Chunk 69
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The balance sheet is considered “asset sensitive” when an increase in short-term interest rates is expected to expand our net interest income, as rates earned on our interest-earning assets reprice higher at a pace faster than rates paid on our interest-bearing liabilities. Conversely, the balance sheet is considered “liability sensitive” when an increase in short-term interest rates is expected to compress our net interest income, as rates paid on our interest-bearing liabilities reprice higher at a pace faster than rates earned on our interest-earning assets.

At December 31, 2024, our interest rate risk profile is “neutral”, as compared to a slightly “liability sensitive” interest rate risk profile position as of December 31, 2023. This shift to neutral is primarily due to the change in the mix of loans related to fixed rate loan sales, variable rate loan growth, and the AFS securities portfolio repositioning during 2024. Given the uncertainty of the magnitude, timing, and direction of future interest rate movements, as well as the shape of the yield curve, actual results may vary materially from those predicted by our model. 

The following table presents the projected change in the Company’s economic value of equity at December 31, 2024 and net interest income over the next twelve months, that would occur upon an immediate change in interest rates, but without giving effect to any steps that management might take to counteract that change:

Change in Interest Rates in Basis Points (bps) (1)Economic Value of EquityNet Interest IncomeAmountPercentageAmountPercentageDecember 31, 2024AmountChangeChangeAmountChangeChange(Dollars in millions)+100 bps$5,550 $35 0.6 %$1,090 $6 0.6 %0 bps$5,515 $1,084 -100 bps$5,809 $294 5.3 %$1,075 $(9)(0.8)%____________________

(1)Assumes an instantaneous uniform change in interest rates at all maturities and no rate shock has a rate lower than zero percent.

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