Banc of California (BANC) investor relations material

Strategic balance sheet actions and capital management

• Executed significant securities repositioning and CRE loan sales in Q2, reinvesting at higher yields and improving earnings outlook.

• Achieved a 285 basis point yield pickup on $2B of securities, with margin guidance ahead of schedule for Q4.

• Maintained capital levels in the low nines post-actions, targeting a return to 10% CET1 by year-end and planning stock buybacks if regulatory clarity is achieved.

• De-risked the balance sheet by selling $825M in select credits and CRE loans, with sales closing in Q3 and early Q4.

• Expecting to benefit from upcoming regulatory capital rule changes, potentially adding 50-60 basis points to CET1.

Credit quality, loan growth, and deposit trends

• Credit portfolio expected to remain stable, with provisions returning to historical levels of $9-11M per quarter.

• Strong loan and deposit growth observed in Q3, with broad-based production and net loan growth anticipated.

• Non-interest-bearing deposits (NIB) have increased from 25% to nearly 30%, with a new target of 35% once 30% is sustained.

• Margin supported by higher NIB balances and repricing of $5.4B in multifamily loans, expected to add $50M pre-tax income over two years.

• Redemption of preferred stock in 2027 projected to return $20M after-tax income to common shareholders.

Earnings outlook and business strategy

• Earnings profile accelerating due to securities repositioning and higher new production yields (~6.4%).

• Targeting mid to upper single-digit loan growth, with a focus on responsible, core-funded expansion.

• Single-family loan portfolio expected to grow, with strong risk-adjusted yields and hedging against prepayment risk.

• Real estate exposure managed below 300% of capital, with ongoing growth in fund finance, lender finance, and middle market C&I.

• Business conditions described as benign, with manageable macroeconomic noise and continued client demand.