Company: MCHB
Filing Date: 2025-05-09
Form Type: 425
Source: 0001518715-25-000085
Chunk: 27

Company: Mechanics Bancorp
Filing Date: 2025-05-09
Form: 425
Chunk 27
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 time is likely to shrink that into the high two hundreds, probably over a four-year period. We're going to continue to be judicious around traditional commercial real estate lending, especially if it's brokered business without core deposits. And I think multifamily because of this sheer volume at both banks, we likely need to bring that down. I know you've already sold some loans, we're not going to do that, but what we

will do is probably add some of these multifamily deals, hit their reset dates, will likely let some of them refinance out and try to bring it from pro forma will be I think it's like $5.9 billion. I'd have to look at my math on it, but we're going to probably get it down closer to four and a half billion over a five year period, so we'll still be originating multifamily loans but just given the concentration of the two combined entities over time, we will work it down, because we don't want to have any lending in the bank be an outsized component. We want to be a diversified bank, and we're also content to leave a higher proportion of our earning assets in more liquid securities and cash. Mark Mason There's a question on mortgage underwriting guidelines. It's a little technical, so let me tone it down a little bit. Many companies, even for their own balance sheets, simply use agency guidelines. HomeStreet has always had its own guidelines for portfolio products. How does Mechanics approach that? Daniel Watt Great question. So we already have great portfolio guidelines built out. We do use Fannie Mae as the backbone just so that our guidelines aren't 3,4,5 hundred pages. But we do have guidelines that are portfolio specific, so for example acid depletion, RSU income and so forth. So we do largely lean on Fannie just for brevity, but we do have specific portfolio linear guidelines, and that's one of the things we're doing through integration is comparing what HomeStreet has to what we have, and we're always looking to enhance and see what we can do to continue to expand that. Mark Mason Great answer, particularly the detail about asset depletion and RSUs. Up here, high tech business area and a lot of home buyers rely on their equity awards, investings for part of their ongoing earnings but also down payments and so on. And it's very important aspect here. Daniel Watt Right. This market is very similar to Silicon Valley world, and that's very prevalent. So