Banc of California (BANC) Q1 2026 earnings summary

Executive summary

• Diluted EPS rose 50% year-over-year to $0.39, with pre-tax, pre-provision income up 28% and net earnings of $62 million for Q1 2026.

• Net interest margin expanded to 3.24%, driven by improved funding costs, margin expansion, and disciplined expense management.

• Loan production reached $2.1 billion in Q1, supporting balance sheet remixing toward higher-yielding assets.

• Repurchased 1.7 million shares at an average price of $18.68 per share and extended buyback program; announced $385 million subordinated debt redemption.

• Maintained strong balance sheet with CET1 ratio at 10.18% and primary plus secondary liquidity of $14.2 billion.

Financial highlights

• Net income for Q1 was $62 million, or $0.39 per diluted share, up 50% year-over-year.

• Net interest income rose 8% year-over-year to $251.6 million; NIM expanded to 3.24%.

• Noninterest income was $35.3 million, flat quarter-over-quarter excluding a prior lease gain.

• Noninterest expense was $181.4 million, flat sequentially and down 1% year-over-year.

• Tangible book value per share increased 10% year-over-year to $17.77.

Outlook and guidance

• FY 2026 outlook unchanged: targeting mid-single-digit growth in loans and deposits, ROAA of 1.1%+, ROTCE of 13%+, and CET1 ratio of 10%+.

• Pre-tax pre-provision income expected to grow 20–25% year-over-year; noninterest expense to rise 3.0–3.5% with an adjusted efficiency ratio in the mid-50% range.

• Expect NIM to expand by 3-4 basis points per quarter, with loan and deposit growth in the mid-single digits.

• No Fed rate cuts assumed in outlook; margin benefit expected from ongoing loan portfolio remixing and repricing $3.2 billion of multifamily loans over 2.5 years.

• Management expects continued earnings growth, supported by strong pipelines, asset repricing opportunities, and a robust market position.