Company: BANC-PF
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001628280-25-050892
Chunk: 163

Company: BANC OF CALIFORNIA, INC.
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 8
Chunk 163
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5  compared to $30.0 million for the nine months ended September 30, 2024. The provision for the 2025 period primarily included a provision for loan losses of $57.0 million and a provision for unfunded loan commitments of $1.2 million.

The provision for the 2025 period included $26.3 million related to loans transferred to HFS, as described above. The remaining increase in the provision for loan losses and unfunded loan commitments was primarily driven by net charge-off activity, with additional impacts from changes in loan risk ratings. These were offset partially by lower specific reserves and a favorable shift in the portfolio mix due to growth in loan segments with lower expected credit losses.

The provision for loans losses and unfunded loan commitments for the 2024 period included a $32.0 million provision for loan losses and a $2.0 million reversal of the provision for unfunded loan commitments. The provision for the 2024 period was generally due to higher net charge-offs and higher qualitative reserves, offset partially by the reserves released for the Civic loans transferred to HFS in the second quarter of 2024 and sold in the third quarter of 2024.

Certain circumstances may lead to increased provisions for credit losses on loans and leases in the future. Examples of such circumstances include deterioration in economic conditions and forecasts, an increased amount of classified and/or criticized loans and leases, and net loan and lease and unfunded commitment growth. Deterioration in economic conditions and forecasts may include the rate of economic growth, the unemployment rate, the rate of inflation, changes in the general level of interest rates, changes in real estate values, and adverse conditions in borrowers’ businesses. See further discussion in “- Balance Sheet Analysis - Allowance for Credit Losses on Loans and Leases Held for Investment” contained herein.

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Noninterest Income

The following table summarizes noninterest income by category for the periods indicated:

Three Months EndedNine Months EndedSeptember 30,June 30,September 30,Noninterest Income2025202520252024(In thousands)Leased equipment income$10,321 $10,231 $31,336 $40,379 Commissions and fees9,514 9,641 29,113 25,027 Service charges on deposit accounts5,109 4,456 14,108 13,813 (Loss) gain on sale of loans and leases(374)30 (133)625 Loss on sale of