Stock on the Run: Banc of California, Inc. (NYSE: BANC)

On Friday, Shares of Banc of California, Inc. (NYSE: BANC) remained unchanged and closed the trade at $20.40. The stock opened its trade at $20.35 and after floating in a price range of $20.25 to $20.65; the stock grabbed the investor’s attention and traded 672,187 shares as compared to its average daily volume of 774.24K shares.

Banc of California, Inc. (BANC) recently stated net income available to common stockholders of $6.20M, for the fourth quarter of 2017, resulting in diluted earnings per common share of $0.12 for the quarter.  Net income available to common stockholders for the full year was $37.30M, resulting in diluted earnings per common share of $0.71 for the full year.  Diluted earnings per common share from continuing operations were $0.11 for the fourth quarter and $0.63 for the full year.

Highlights for the fourth quarter included:

  • Strong Organic Loan Growth:  Held for investment loans increased by $433.0M, or 7%, during the quarter to $6.70B.
  • Continuation of Balance Sheet Re-Mix:  Reduced securities by $180.0M, or 7%, driven by decline of collateralized loan obligation (“CLO”) balances of $117.0M, and the sales of $24.0M of master limited partnership debt securities (“MLPs”) and $23.0M of bank debt.
  • Disciplined Expense Management:  Achieved targeted quarterly, recurring, run-rate expenses of $59.10M for the quarter, apart from expense related to loss on investments in alternative energy partnerships and non-recurring expenses.

The Company’s fourth quarter stated financial results included $3.30M of non-recurring expenses, $4.40M of negative valuation adjustments to the mortgage servicing rights (“MSRs”), and $2.10M of a net tax benefit as a result of re-measurement of the Company’s deferred tax assets and liabilities because of the recently enacted tax reform legislation.

“During the fourth quarter, we continued to make substantial progress on our strategy to re-mix the balance sheet, reducing securities by $180.0M, and increasing loan balances by $433.0M, as our banking teams delivered a strong finish to cap off 2017,” said Doug Bowers, President and Chief Executive Officer of Banc of California.  “These results reflect the focused effort centered on growing our core, commercial banking businesses.  We continue to work hard on improving the funding profile of the institution, and although we saw a modest decline in overall deposit balances as we reduced select high-rate and high volatility deposits this quarter, we did see increased deposit balances collectively in commercial, private and retail banking, which increased by $290.0M.  Improving our funding base continues to be our number one aim and priority.  In wrapping up 2017, I want to say thank you to all my colleagues for their hard work and dedication over the course of the year.  As I look into the New Year, we have a tremendous opportunity in front of us, and while there is certainly much work that lies ahead, I believe we have a strong foundation in place, with a great brand and talented people across the company, which position us well to achieve our aims for California’s Bank in 2018.”

BANC has a market value of $1.02B while its EPS was booked as $0.63 in the last 12 months. The stock has 50.11M shares outstanding. In the profitability analysis, the company has net profit margin of 19.50%. Beta value of the company was 0.91; beta is used to measure riskiness of the security. Analyst recommendation for this stock stands at 2.40.

 I am Wayne Parsons and I have over 16 years experience in the financial services industry giving me a vast understanding of how news affects the financial markets. I am an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.

Email: wayne.parsons@nasdaqexpress.com

Wayne Parsons

 I am Wayne Parsons and I have over 16 years experience in the financial services industry giving me a vast understanding of how news affects the financial markets. I am an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.Email: wayne.parsons@nasdaqexpress.com