EX-99.1 2 a10-4732_1ex99d1.htm EX-99.1

Exhibit 99.1

 

PRESS RELEASE

 

PacWest Bancorp

(NASDAQ: PACW)

 

Contact:

Matthew P. Wagner

 

Victor R. Santoro

 

Chief Executive Officer

 

Executive VP and CFO

 

PacWest Bancorp

 

PacWest Bancorp

 

10250 Constellation Blvd.

 

10250 Constellation Blvd.

 

Suite 1640

 

Suite 1640

 

Los Angeles, CA 90067

 

Los Angeles, CA 90067

Phone:

310-728-1020

 

310-728-1021

Fax:

310-201-0498

 

310-201-0498

 

FOR IMMEDIATE RELEASE

 

February 24, 2010

 

PACWEST BANCORP ANNOUNCES THE SALE OF $323.6 MILLION OF NON-COVERED ADVERSELY CLASSIFIED LOANS, INCLUDING $107.6 MILLION OF NONACCRUAL LOANS

 

CAPITAL POSITION ALLOWS PACWEST TO CLEAR BALANCE SHEET FOR FUTURE GROWTH

 

San Diego, California . . . PacWest Bancorp (Nasdaq: PACW) today announced that on Tuesday, February 23, 2010, its wholly-owned bank subsidiary, Pacific Western Bank, completed the sale of 61 non-covered adversely classified loans totaling $323.6  million, which includes $107.6 million of nonaccrual loans, to an institutional buyer for $200.6 million in cash.  The sale was on a servicing-released basis and without recourse to Pacific Western Bank.  The loans sold represent over one-half of the Bank’s non-covered adversely classified loans.  All loans sold were legacy Pacific Western Bank loans and none were “covered loans” acquired in the Affinity Bank acquisition.

 

Matt Wagner, Chief Executive Officer commented, “Removing almost $324 million of problem loans from our portfolio in a single transaction creates tremendous opportunity for the Company.”

 

Mr. Wagner continued, “We remain cautious and vigilant with respect to credit, and our existing loan portfolio is subject to uncertainty and volatility given the fragile economic environment.  Without these problem loans, however, and given the significant earnings power of our Company, we believe PacWest is well-positioned to grow, both organically and through acquisition.”

 

Vic Santoro, Executive Vice President and Chief Financial Officer, stated, “The expected after tax loss from the disposition of these classified and non-accrual loans is estimated to be $41 million.  Our significant capital base gives us the flexibility to not only absorb this loss now, but also to remain above the well-capitalized regulatory capital requirements.”

 

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Actual and pro forma unaudited credit-related financial information as of December 31, 2009 is shown below.  The pro forma amounts reflect the sale of the adversely classified loans as of year-end 2009.  The amounts shown in the columns headed “Loans Sold” represent the balances of the loans on December 31, 2009; the balances of such loans on the date sold totaled $323.6 million.

 

The following table shows our non-covered loan portfolio concentration and credit quality data as of December 31, 2009 and on a pro forma basis giving effect to the loan sale.

 

 

 

At December 31, 2009

 

 

 

Actual

 

Loans Sold

 

Pro Forma

 

 

 

(Dollars in thousands)

 

Commercial

 

$

815,527

 

$

(9,948

)

$

805,579

 

Real estate - construction

 

440,286

 

(143,955

)

296,331

 

Commercial real estate -mortgage

 

2,425,328

 

(171,931

)

2,253,397

 

Consumer

 

32,241

 

—

 

32,241

 

Total non-covered loans

 

3,713,382

 

(325,834

)

3,387,548

 

Unearned income, net

 

(5,999

)

(825

)

(5,174

)

Total non-covered loans, net of unearned income, net

 

$

3,707,383

 

$

(325,009

)

$

3,382,374

 

 

 

 

 

 

 

 

 

 

Non-covered nonaccrual loans

 

$

240,167

 

$

(110,536

)

$

129,631

 

 

 

 

 

 

 

 

 

 

Non-covered nonaccrual loans to total non-covered loans, net of unearned income

 

6.48

%

 

 

3.83

%

 

The details of the construction loan portfolio as of December 31, 2009 and on a pro forma basis giving effect to the loan sale follow:

 

 

 

At December 31, 2009

 

 

 

Actual

 

Loans Sold

 

Pro Forma

 

 

 

(Dollars in thousands)

 

Commercial construction:

 

 

 

 

 

 

 

100% owner occupied

 

$

20,086

 

$

(6,756

)

$

13,330

 

Industrial/warehouse

 

67,915

 

(8,436

)

59,479

 

Office building

 

37,300

 

(32,706

)

4,594

 

Retail

 

49,573

 

(24,140

)

25,433

 

Land acquisition

 

38,905

 

(6,775

)

32,130

 

Unimproved commercial land

 

25,709

 

—

 

25,709

 

Other

 

28,860

 

(4,459

)

24,401

 

Total commercial construction

 

268,348

 

(83,272

)

185,076

 

 

 

 

 

 

 

 

 

Residential construction:

 

 

 

 

 

 

 

Land acquisition and development

 

$

52,458

 

$

(26,950

)

$

25,508

 

Nonowner-occupied single family

 

30,103

 

(9,925

)

20,178

 

Unimproved residential land

 

39,003

 

—

 

39,003

 

Multifamily

 

38,825

 

(20,690

)

18,135

 

Owner occupied

 

11,549

 

(3,118

)

8,431

 

Total residential construction

 

171,938

 

(60,683

)

111,255

 

Total construction

 

$

440,286

 

$

(143,955

)

$

296,331

 

 

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Our largest non-covered loan portfolio concentration is the real estate mortgage category, which includes loans secured by commercial and residential real estate.  The loans sold reduce our non-covered real estate mortgage loan portfolio as indicated in the following table.

 

 

 

At December 31, 2009

 

 

 

Actual

 

Loans Sold

 

Pro Forma

 

 

 

(Dollars in thousands)

 

Commercial real estate mortgage:

 

 

 

 

 

 

 

Owner-occupied

 

$

377,057

 

$

(12,392

)

$

364,665

 

Retail

 

479,370

 

(32,088

)

447,282

 

Office buildings

 

343,746

 

—

 

343,746

 

Industrial/warehouse

 

356,227

 

—

 

356,227

 

Hotels and other hospitality

 

257,489

 

(57,986

)

199,503

 

Other

 

381,167

 

(14,593

)

366,574

 

Total commercial real estate mortgage

 

2,195,056

 

(117,059

)

2,077,997

 

 

 

 

 

 

 

 

 

Residential real estate mortgage:

 

 

 

 

 

 

 

Multi-family

 

105,276

 

(25,216

)

80,060

 

Single family owner-occupied

 

84,591

 

(9,667

)

74,924

 

Single family nonowner-occupied

 

40,405

 

(19,989

)

20,416

 

Total residential real estate mortgage

 

230,272

 

(54,872

)

175,400

 

Total real estate mortgage

 

$

2,425,328

 

$

(171,931

)

$

2,253,397

 

 

ABOUT PACWEST BANCORP

 

PacWest Bancorp is a bank holding company with $5.3 billion in assets as of December 31, 2009, with one wholly-owned banking subsidiary, Pacific Western Bank. Through 68 full-service community banking branches, Pacific Western provides commercial banking services, including real estate, construction and commercial loans, to small and medium-sized businesses. Pacific Western’s branches are located in Los Angeles, Orange, Riverside, San Bernardino, San Diego, San Francisco, San Mateo and Ventura Counties. Through its subsidiary BFI Business Finance and its division First Community Financial, Pacific Western also provides working capital financing to growing companies located throughout the Southwest, primarily in the states of Arizona, California and Texas. Additional information regarding PacWest Bancorp is available on the Internet at www.pacwestbancorp.com. Information regarding Pacific Western Bank is also available on the Internet at www.pacificwesternbank.com.

 

Contact information:

 

Matt Wagner, Chief Executive Officer, (310) 728-1020

Vic Santoro, Executive Vice President and CFO, (310) 728-1021

 

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