Company: MCHB
Filing Date: 2025-04-15
Form Type: ARS
Source: 0001518715-25-000069
Chunk: 13

Company: Mechanics Bancorp
Filing Date: 2025-04-15
Form: ARS
Chunk 13
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: There was no provision for credit losses recognized during 2024 as compared to a $0.4 million recovery in 2023. For 2024, the benefits of the reduction in loan balances during the year were offset by specific reserves on commercial loans. In the fourth quarter, we continued to experience a minimal level of identified credit issues in our loan portfolio and a lack of significant expected credit issues arising in future periods. The recovery of provision for credit losses in 2023 reflects the stable balance of our loan portfolio and minimal level of identified credit issues in our loan portfolio. 12

Noninterest income (loss) consisted of the following: Years Ended December 31, (in thousands) 2024 2023 Noninterest income (loss) Gain (loss) on loan origination and sale activities (1) Single family $ 9,573 $ 8,500 CRE, multifamily and SBA (2) (86,463) 846 Loan servicing income 12,497 12,648 Deposit fees 8,838 10,148 Other 11,170 9,779 Total noninterest income (loss) $ (44,385) $ 41,921 (1) May include loans originated as held for investment. (2) 2024 amount includes loss of $88.8 million on sale of $990 million of multifamily loans in the fourth quarter. Loan servicing income, a component of noninterest income, consisted of the following: Years Ended December 31, (in thousands) 2024 2023 Single family servicing income (loss), net: Servicing fees and other $ 15,081 $ 15,523 Changes - amortization (1) (6,500) (6,378) Subtotal 8,581 9,145 Risk management, single family MSRs: Changes in fair value due to assumptions (2) 1,743 414 Net gain (loss) from economic hedging (2,932) (1,744) Subtotal (1,189) (1,330) Total $ 7,392 $ 7,815 Commercial loan servicing income: Servicing fees and other $ 10,717 $ 10,611 Amortization of capitalized MSRs (5,612) (5,778) Total 5,105 4,833 Total loan servicing income $ 12,497 $ 12,648 (1) Represents changes due to collection/realization of expected cash flows and cur