Company: BANC-PF
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001169770-25-000029
Chunk: 24

Company: BANC OF CALIFORNIA, INC.
Filing Date: 2025-08-08
Form: 10-Q
Item: Item 2
Chunk 24
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 — (12,650)Total noninterest expense$185,869 $183,653 $369,522 $414,161 

Second Quarter of 2025 Compared to First Quarter of 2025 

Noninterest expense increased by $2.2 million to $185.9 million for the second quarter from $183.7 million for the first quarter due mainly to increases of $2.1 million in insurance and assessments and $1.9 million in compensation expense, offset partially by a decrease of $2.0 million in information technology and data processing expenses. Insurance assessments increased mainly due to lower FDIC assessment and FDIC expense true-ups in the first quarter. Compensation expense increased mainly driven by higher incentive and equity compensation reversals related to staff exits in the prior quarter. Information technology and data processing decreased mainly driven by lower software subscription costs and certain expense true-ups.

Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

Noninterest expense decreased by $44.6 million to $369.5 million for the six-month period ended June 30, 2025 due mainly to decreases of $30.2 million in insurance and assessments, $9.0 million in customer related expenses, $4.9 million in occupancy, $3.4 million in compensation expense, and $13.1 million in all of the other expense categories, offset partially by an increase of $12.7 million in acquisition, integration and reorganization costs, as the prior-year period included a reversal of previously accrued merger-related costs due to lower actual expenses and there are no merger-related costs in the current year. Insurance and assessment decreased primarily due to incremental FDIC special assessments recorded in the first quarter of 2024, resulting from higher assessment rates. Customer related expense decreased due to lower earnings credit rate expenses, which were impacted by the lower federal funds rate. Occupancy decreased reflecting cost savings from branch consolidations following the merger. Compensation expense decreased primarily driven by reduced headcount following the merger.

88

Income Taxes

Second Quarter of 2025 Compared to First Quarter of 2025 

Income tax expense of $19.5 million was recorded for the second quarter resulting in an effective tax rate of 40.7% compared to income tax expense of $19.5 million and an effective tax rate of 26.7% for the first quarter. 

The 40.7% effective tax rate in the second quarter of 2025 included