Company: BANC-PF
Filing Date: 2025-05-09
Form Type: 10-Q
Source: 0001169770-25-000024
Chunk: 145

Company: BANC OF CALIFORNIA, INC.
Filing Date: 2025-05-09
Form: 10-Q
Item: Item 8
Chunk 145
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 2025 compared to the fourth quarter of 2024, and average interest-bearing deposits decreasing by $56.1 million for those same comparative periods. Average noninterest-bearing deposits represented 29% of average total deposits in both quarters.

•The average yield on interest-earning assets decreased by 9 basis points to 5.39% for the first quarter of 2025 compared to 5.48% for the fourth quarter of 2024 due mainly to the average yield on deposits in financial institutions decreasing by 33 basis points and the average yield on loans and leases decreasing by 11 basis points, offset partially by the average yield on investment securities increasing by 5 basis points. The average yield on deposits in financial institutions was 4.41% for the first quarter of 2025 compared to 4.74% for the fourth quarter of 2024, driven by the federal funds rate cuts as described above. The average yield on loans and leases was 5.90% for the first quarter of 2025 compared to 6.01% for the fourth quarter of 2024 due primarily to aforementioned lower loan prepayments and lower market interest rates. These decreases were partially offset by an increase in the average yield on investment securities, which was 3.24% in the first quarter of 2025 compared to 3.19% in the fourth quarter of 2024 as we continued to benefit from the balance sheet repositioning actions taken in 2024 and the purchase of and reinvestment into higher-yielding securities. Additionally, average deposits in financial institutions decreased by $386.6 million to $2.1 billion in the first quarter of 2025 from $2.5 billion in the fourth quarter of 2024 as we maintained a lower cash target level.

72

First Quarter of 2025 Compared to First Quarter of 2024

Net interest income increased by $3.3 million to $232.4 million for the first quarter of 2025 from $229.1 million for the first quarter of 2024 attributable primarily to the following:

•A decrease of $54.3 million in interest expense paid on deposits, including a $26.3 million reduction in interest expense paid on interest-bearing non-brokered deposits, driven by lower average balances and lower market interest rates following the federal funds rate cuts of 100 basis points during 2024. In addition, interest expense paid on brokered deposits decreased by $28.0 million as higher-cost wholesale