California BanCorp (CALB) investor relations material

Executive summary

• Completed an all-stock merger with former California BanCorp on July 31, 2024, expanding Northern California presence and increasing scale and market share through complementary business models and a strong deposit base.

• Relationship-focused commercial bank with $1.92B in assets and $182M market cap as of Q2 2024, targeting privately owned companies with $30M–$300M in annual revenue.

• Maintained a strong balance sheet with diversified loan and deposit portfolios, minimal sector or customer concentration outside of commercial real estate, and no significant exposure to cryptocurrency or venture capital.

• Proactively defended deposit base amid industry volatility by increasing rates on interest-bearing deposits and maintaining robust liquidity.

• Experienced management team with deep industry expertise and long tenures, driving organic growth and strategic acquisitions since 2007.

Financial highlights

• Q2 2024 assets: $1.92B; loans: $1.49B; deposits: $1.64B; tangible equity: $188M.

• Net income for Q2 2024 was $0.2M ($0.01 per diluted share), down from $6.7M in Q2 2023, primarily due to higher noninterest expense, increased provision for credit losses, and lower net interest income.

• Net interest margin for Q2 2024 was 3.71%, with net interest income of $21.0M, and efficiency ratio at 71.9%.

• Provision for credit losses surged to $13.5M in Q2 2024, with net charge-offs of $13.3M.

• Operating expenses in Q2 2024 include $647K in merger-related costs and a $4.8M pre-tax loss on OREO sale.

Outlook and guidance

• Management expects ongoing margin pressure, slower loan growth, and higher deposit costs, with integration and cost savings from the merger as key focus areas.

• Positioned to leverage recent investments in talent, technology, and product development for future growth, with disciplined credit underwriting and relationship-driven deposit growth.