Los Angeles-based PacWest Bancorp, which has 13 branches in the tri-county region, reported net earnings for the third quarter that were higher than a year before, but down from the previous quarter.
In an Oct. 18 release, PacWest Bancorp, the parent company for Pacific Western Bank, reported net earnings of $140 million, or $1.17 per diluted share, for the third quarter of 2021. Net earnings in the third quarter of 2020 were $45.5 million, or $0.38 per diluted share, and in the second quarter of 2021, the bank had earnings of $180.5 million, or $1.52 per share.
The bank reported $275.8 million in net interest income in the third quarter of 2021, up from $266.3 million in the second quarter of 2021. Executives credited the growth to higher income on investment securities and loans and leases primarily resulting from higher average balances as the bank deploys its excess liquidity.
“For the second consecutive quarter, we experienced significant loan growth as loans grew $1 billion to an all-time high of $20.5 billion,” PacWest Bancorp President and CEO Matt Wagner said in a statement. “Deploying approximately $3 billion of excess liquidity into higher-yielding securities and loans during the third quarter resulted in a $9.5 million increase in net interest income and helped drive a $12.8 million increase in our pre-tax pre-provision net revenue compared to the second quarter.”
PacWest Bancorp said the average balance of investment securities increased to $8 billion, the average balance of deposits in financial institutions dropped to $5.7 billion, and the average balance of loans and leases rose by $613.3 million in the third quarter of 2021. The increase in average balances of investment securities and loans and leases is attributed to deploying some of PacWest Bancorp’s excess liquidity ahead of closing the acquisition of the Homeowners Association Services Division of MUFG Union Bank, which added about $4.1 billion of deposits on Oct. 8.
PacWest Bancorp is a bank holding company with more than $35 billion in assets and about 1,800 employees. It has 69 branches in California, as well as one in North Carolina and Colorado.