Pacific Western Bank reports earnings recovery in first quarter
PacWest Bancorp saw its net income soar a year after a devastating low.
The parent company of Pacific Western Bank, which is based in Los Angeles and has 15 branches in the Tri-Counties, reported net income of $150 million, or $1.27 per diluted share, for the first quarter of 2021. In the first quarter of 2020, it had a net loss of $1.4 billion, or $12.23 per diluted share.
The bank attributed the losses a year ago to a $1.47 billion goodwill impairment charge, as well as increased loan loss provisions as the bank shored up its reserves at the beginning of the pandemic. The bank is still shoring up its reserves, as it added $48 million to those reserves in the most recent quarter.
PacWest is seeing gains in other areas. Core deposits increased by $3.3 billion, or 15%, in the first quarter of 2021. The bank originated $381 million of federal Paycheck Protection Program loans in the first quarter, and on March 31, it signed an agreement with MUFG Union Bank to buy the Homeowners Association Business, which will bring about another $4 billion in deposits. The deal is expected to close towards the end of 2021.
“We experienced strong deposit growth again in the first quarter driven by outstanding growth from our venture banking clients as well as our commercial bank,” said Matt Wagner, the president and CEO of PacWest Bancorp, in a press release.