BANC OF CALIFORNIA, INC.

For the period ended Sep 30, 2025. Filed Nov 10, 2025.

About this filing

A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Sep 30, 2025 · Filed Nov 10, 2025

BANC$17.98+0.1%Stored close · as of Nov 6, 2026

See the whole filing, with its images and exhibits

Contents

Item 1. Condensed Consolidated Financial Statements (Unaudited)

PART II. OTHER INFORMATION
	Condensed Consolidated Balance Sheets (Unaudited)	5
	Condensed Consolidated Statements of Earnings (Unaudited)	6
	Condensed Consolidated Statements of Comprehensive Income (Unaudited)	8
	Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited)	9
	Condensed Consolidated Statements of Cash Flows (Unaudited)	15
	Notes to Condensed Consolidated Financial Statements (Unaudited)	17
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	75
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	113
Item 4.	Controls and Procedures	117
Item 1.	Legal Proceedings	117
Item 1A.	Risk Factors	117
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	118
Item 3.	Defaults Upon Senior Securities	118
Item 4.	Mine Safety Disclosures	118
Item 5.	Other Information	118
Item 6.	Exhibits	119
Signatures	120

PART I. FINANCIAL INFORMATION

Glossary of Acronyms, Abbreviations, and Terms

The acronyms, abbreviations, and terms listed below are used in various sections of this Quarterly Report on Form 10-Q, including "Item 1. Financial Statements" and "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations."

ACL	Allowance for Credit Losses	FRBSF	Federal Reserve Bank of San Francisco
AFS	Available-for-Sale	HFS	Held for Sale
AFX	American Financial Exchange	HLBV	Hypothetical Liquidation at Book Value
ALLL	Allowance for Loan and Lease Losses	HOA	Homeowners Association
ALM	Asset Liability Management	HTM	Held-to-Maturity
ASC	Accounting Standards Codification	ICS	IntraFi Cash Service
ASU	Accounting Standards Update	IRR	Interest Rate Risk
Basel III	A comprehensive capital framework and rules for U.S. banking organizations approved by the FRB and the FDIC in 2013	LIHTC	Low Income Housing Tax Credit
BOLI	Bank Owned Life Insurance	LOCOM	Lower of Cost or Market
CDI	Core Deposit Intangible Assets	MBS	Mortgage-Backed Securities
CECL	Current Expected Credit Loss	NAV	Net Asset Value
CET1	Common Equity Tier 1	NII	Net Interest Income
Civic	Civic Financial Services, LLC (a company acquired on February 1, 2021)	NVCE	Non-Voting Common Stock Equivalents
CMBS	Commercial Mortgage-Backed Securities	OREO	Other Real Estate Owned
CMOs	Collateralized Mortgage Obligations	PCD	Purchased Credit Deteriorated
CODM	Chief Operating Decision Maker	PSUs	Performance Stock Units
COVID-19	Coronavirus Disease	ROU	Right-of-use
CRA	Community Reinvestment Act	RSUs	Restricted Stock Units
CRI	Customer Relationship Intangible Assets	S&P	Standard & Poor's
DFPI	California Department of Financial Protection and Innovation	SBA	Small Business Administration
DTAs	Deferred Tax Assets	SBIC	Small Business Investment Company
ECR	Earnings Credit Rate	SEC	Securities and Exchange Commission
EVE	Economic Value of Equity	SOFR	Secured Overnight Financing Rate
FDIC	Federal Deposit Insurance Corporation	TRSAs	Time-Based Restricted Stock Awards
FHLB	Federal Home Loan Bank of San Francisco	U.S. GAAP	U.S. Generally Accepted Accounting Principles
FRB	Board of Governors of the Federal Reserve System

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30,	December 31,
	2025	2024
(Unaudited)
	(Dollars in thousands,
	except par value amounts)
ASSETS:
Cash and due from banks	$205,364	$192,006
Interest-earning deposits in financial institutions	2,192,901	2,310,206
Total cash, cash equivalents, and restricted cash	2,398,265	2,502,212
Securities available-for-sale, at fair value, net of allowance for credit losses (amortized cost of
$2,634,761 and $2,526,644, respectively)(ACL of $775 and $—, respectively)	2,426,734	2,246,839
Securities held-to-maturity, at amortized cost, net of allowance for credit losses (fair value of
$2,223,622 and $2,156,694, respectively)(ACL of $695 and $1,500, respectively)	2,303,657	2,306,149
FRB and FHLB stock, at cost	159,337	147,773
Total investment securities	4,889,728	4,700,761
Loans held for sale	211,454	26,331
Loans and leases held for investment	24,110,642	23,781,663
Allowance for loan and lease losses	(240,501)	(239,360)
Total loans and leases held for investment, net	23,870,141	23,542,303
Equipment leased to others under operating leases	280,872	307,188
Premises and equipment, net	132,766	142,546
Bank owned life insurance	348,051	339,517
Goodwill	214,521	214,521
Intangible assets, net	111,923	132,944
Deferred tax asset, net	672,159	720,587
Other assets	883,085	913,954
Total assets	$34,012,965	$33,542,864
LIABILITIES:
Noninterest-bearing deposits	$7,603,748	$7,719,913
Interest-bearing deposits	19,581,017	19,471,996
Total deposits	27,184,765	27,191,909
Borrowings (including $115,022 and $118,838 at fair value, respectively)	2,005,022	1,391,814
Subordinated debt	950,888	941,923
Accrued interest payable and other liabilities	405,551	517,269
Total liabilities	30,546,226	30,042,915
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Preferred stock	498,516	498,516
Common stock ($0.01 par value, 150,904,772 shares issued and 150,826,212 outstanding at
September 30, 2025; 158,557,735 shares issued and 158,346,529 outstanding at December 31, 2024)	1,509	1,586
and 477,321 shares issued at December 31, 2024)	5	5
Non-voting common stock equivalents ($0.01 par value, 4,140,600 shares issued at
September 30, 2025 and 9,790,600 shares issued at December 31, 2024)	41	98
Additional paid-in capital	3,563,145	3,785,725
Retained deficit	(309,460)	(431,201)
Accumulated other comprehensive loss, net	(287,017)	(354,780)
Total stockholders' equity	3,466,739	3,499,949
Total liabilities and stockholders' equity	$34,012,965	$33,542,864

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

Three Months Ended · Nine Months Ended
September 30, · June 30, · September 30, · September 30,
	2025	2025	2024	2025	2024
(Unaudited)
(In thousands, except per share amounts)
Interest income:
Loans and leases	$372,723	$362,303	$369,913	$1,081,129	$1,144,231
Investment securities	38,291	37,616	34,912	113,769	103,051
Deposits in financial institutions	21,527	20,590	42,068	64,807	140,904
Total interest income	432,541	420,509	446,893	1,259,705	1,388,186
Interest expense:
Deposits	143,074	144,940	180,986	428,544	561,899
Borrowings	20,461	20,021	16,970	58,903	85,405
Subordinated debt	15,562	15,332	16,762	46,234	50,117
Total interest expense	179,097	180,293	214,718	533,681	697,421
Net interest income	253,444	240,216	232,175	726,024	690,765
Provision for credit losses	9,700	39,100	9,000	58,100	30,000
Net interest income after provision for
credit losses	243,744	201,116	223,175	667,924	660,765
Noninterest income:
Leased equipment income	10,321	10,231	17,176	31,336	40,379
Commissions and fees	9,514	9,641	8,256	29,113	25,027
Service charges on deposit accounts	5,109	4,456	4,568	14,108	13,813
(Loss) gain on sale of loans and leases	(374)	30	(62)	(133)	625
Loss on sale of securities	—	—	(59,946)	—	(59,946)
Dividends and gains (losses) on equity
investments	2,291	(114)	3,730	4,500	7,964
Warrant income	433	1,227	211	1,365	65
LOCOM HFS adjustment	—	(9)	(74)	(9)	218
Other income	6,991	7,171	10,689	20,288	20,011
Total noninterest income (loss)	34,285	32,633	(15,452)	100,568	48,156
Noninterest expense:
Compensation	88,865	88,362	85,585	263,644	263,735
Customer related expense	26,227	26,577	34,475	80,555	97,799
Occupancy	15,415	15,473	16,892	45,898	52,315
Information technology and data
processing	13,535	13,073	14,995	41,707	45,872
Insurance and assessments	8,994	9,403	12,708	25,680	59,600
Intangible asset amortization	7,160	7,159	8,485	21,479	25,373
Leased equipment depreciation	6,750	6,700	7,144	20,191	22,175
Other professional services	5,394	6,406	5,101	16,313	15,359
Loan expense	4,947	4,050	3,994	11,927	12,817
Acquisition, integration and
reorganization costs	—	—	(510)	—	(13,160)
Other expense	8,397	8,666	7,340	27,812	28,485
Total noninterest expense	185,684	185,869	196,209	555,206	610,370
Earnings before income taxes	92,345	47,880	11,514	213,286	98,551
Income tax expense	22,716	19,495	2,730	61,704	28,582
Net earnings	69,629	28,385	8,784	151,582	69,969
Preferred stock dividends	9,947	9,947	9,947	29,841	29,841
Net earnings (loss) available to common
and equivalent stockholders	$59,682	$18,438	$(1,163)	$121,741	$40,128

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

Three Months Ended · Nine Months Ended
September 30, · June 30, · September 30, · September 30,
	2025	2025	2024	2025	2024
(Unaudited)
(In thousands, except per share amounts)
Earnings per share:
Basic	$0.38	$0.12	$(0.01)	$0.75	$0.24
Diluted	$0.38	$0.12	$(0.01)	$0.75	$0.24

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended · Nine Months Ended
September 30, · June 30, · September 30, · September 30,
	2025	2025	2024	2025	2024
(Unaudited)
(In thousands)
Net earnings	$69,629	$28,385	$8,784	$151,582	$69,969
Other comprehensive income, net of tax:
Unrealized net holding gains on securities
available-for-sale arising during the period	25,836	8,247	83,902	72,553	66,423
Income tax expense related to unrealized net
holding gains arising during the period	(7,124)	(2,351)	(23,810)	(20,427)	(18,850)
Unrealized net holding gains on securities
available-for-sale, net of tax	18,712	5,896	60,092	52,126	47,573
Reclassification adjustment for net losses included in
net earnings (1)	—	—	59,946	—	59,946
Income tax benefit related to reclassification adjustment	—	—	(17,011)	—	(17,011)
Reclassification adjustment for net losses included
in net earnings, net of tax	—	—	42,935	—	42,935
Amortization of unrealized net loss on securities
transferred from available-for-sale to held-to-maturity	8,646	8,344	8,226	25,332	24,442
Income tax expense related to amortization of unrealized
net loss on securities transferred from
available-for-sale to held-to-maturity	(2,384)	(2,353)	(2,354)	(7,115)	(6,956)
Amortization of unrealized net loss on securities
transferred from available-for-sale
to held-to-maturity, net of tax	6,262	5,991	5,872	18,217	17,486
Change in fair value of credit-linked notes	1,361	(517)	(1,495)	990	(2,110)
Income tax (expense) benefit related to change in fair
value of credit-linked notes	(375)	180	424	(237)	630
Change in fair value of credit-linked notes,
net of tax	986	(337)	(1,071)	753	(1,480)
Unrealized gain (loss) on cash flow hedges arising
during the period	331	(1,952)	(10,216)	(4,594)	(3,508)
Income tax (expense) benefit related to unrealized gain
on cash flow hedges arising during the period	(91)	505	2,899	1,261	960
Unrealized gain (loss) on cash flow hedges,
net of tax	240	(1,447)	(7,317)	(3,333)	(2,548)
Other comprehensive income, net of tax	26,200	10,103	100,511	67,763	103,966
Comprehensive income	$95,829	$38,488	$109,295	$219,345	$173,935

(1) Entire amount recognized in "Loss on sale of securities" on the Condensed Consolidated Statements of Earnings (Loss).

	Nine Months Ended September 30, 2025
Non-
Common Stock · Voting · Accumulated
Class B · Common · Additional · Other
Preferred · Non- · Stock · Paid-in · Retained · Comprehensive
Stock · Voting · Voting · Equivalents · Capital · Deficit · Loss, Net · Total
(Unaudited)
(In thousands, except per share amount)
Balance, December 31, 2024	$498,516		$1,586		$5		$98		$3,785,725			$(431,201)			$(354,780)			$3,499,949
Net earnings	—		—		—		—		—			53,568			—			53,568
Other comprehensive income,
net of tax	—		—		—		—		—			—			31,460			31,460
Restricted stock awarded and
earned stock compensation,
net of shares forfeited	—		2		—		—		5,493			—			—			5,495
Restricted stock surrendered	—		—		—		—		(2,699)			—			—			(2,699)
Shares purchased under
Dividend Reinvestment Plan	—		—		—		—		72			—			—			72
Shares repurchased under
Stock Repurchase Program
including excise tax	—		(27)		—		—		(38,904)			—			—			(38,931)
Cash dividends paid:
Preferred stock, $0.4845/share	—		—		—		—		—			(9,947)			—			(9,947)
Common stock, $0.10/share	—		—		—		—		(17,311)			—			—			(17,311)
Balance, March 31, 2025	$498,516		$1,561		$5		$98		$3,732,376			$(387,580)			$(323,320)			$3,521,656
Net earnings	—		—					—		28,385			—			28,385
Other comprehensive income,
net of tax	—		—		—		—		—			—			10,103			10,103
Restricted stock awarded and
earned stock compensation,
net of shares forfeited	—		1		—		—		6,436			—			—			6,437
Restricted stock surrendered	—		—		—		—		(688)			—			—			(688)
Shares purchased under
Dividend Reinvestment Plan	—		—		—		—		72		—			—			72
Shares repurchased under
Stock Repurchase Program
including excise tax	—	(88)		—		—	(112,826)		—			—			(112,914)
Cash dividends paid:
Preferred stock, $0.4845/share	—		—		—		—		—			(9,947)			—			(9,947)
Common stock, $0.10/share	—		—		—		—		(16,261)			—			—			(16,261)
Balance, June 30, 2025	$498,516		$1,474		$5		$98		$3,609,109			$(369,142)			$(313,217)			$3,426,843

	Nine Months Ended September 30, 2025
Non-
Common Stock · Voting · Accumulated
Class B · Common · Additional · Other
Preferred · Non- · Stock · Paid-in · Retained · Comprehensive
	Stock	Voting	Voting	Equivalents	Capital	Deficit	Loss, Net	Total
(Unaudited)
(In thousands, except per share amount)
Balance, June 30, 2025	$498,516	$1,474	$5	$98	$3,609,109	$(369,142)	$(313,217)	$3,426,843
Net earnings	—	—	—	—	—	69,629	—	69,629
Other comprehensive income,
net of tax	—	—	—	—	—	—	26,200	26,200
Exercise of options	—	—	—	—	77	—	—	77
Restricted stock awarded and
earned stock compensation,
net of shares forfeited	—	—	—	—	6,110	—	—	6,110
Conversion of non-voting
common stock equivalents
to voting common stock	—	45	—	(45)	—	—	—	—
Restricted stock surrendered	—	—	—	—	(230)	—	—	(230)
Shares purchased under the
Dividend Reinvestment Plan	—	—	—	—	70	—	—	70
Shares repurchased under
Stock Repurchase Program
including excise tax	—	(10)	—	(12)	(35,860)	—	—	(35,882)
Cash dividends paid:
Preferred stock, $0.4845/share	—	—	—	—	—	(9,947)	—	(9,947)
Common stock, $0.10/share	—	—	—	—	(16,131)	—	—	(16,131)
Balance, September 30, 2025	$498,516	$1,509	$5	$41	$3,563,145	$(309,460)	$(287,017)	$3,466,739

	Nine Months Ended September 30, 2025
Non-Voting
Common Stock · Common
Preferred · Class B · Stock
	Stock	Voting	Non-Voting	Equivalents
(Unaudited)
(In ones)
Number of shares, December 31, 2024	513,250	158,557,735	477,321	9,790,600
Restricted stock awarded and earned stock
compensation, net of shares forfeited	—	440,587	—	—
Restricted stock surrendered	—	(183,480)	—	—
Shares purchased under Dividend Reinvestment Plan	—	5,146	—	—
Shares repurchased under Stock Repurchase Program	—	(2,684,823)	—	—
Number of shares, March 31, 2025	513,250	156,135,165	477,321	9,790,600
Restricted stock awarded and earned stock
compensation, net of shares forfeited	—	98,629	—	—
Restricted stock surrendered	—	(50,075)	—	—
Shares purchased under Dividend Reinvestment Plan	—	5,311	—	—
Shares repurchased under Stock Repurchase Program	—	(8,809,814)	—	—
Number of shares, June 30, 2025	513,250	147,379,216	477,321	9,790,600
Restricted stock awarded and earned stock
compensation, net of shares forfeited	—	34,712	—	—
Restricted stock surrendered	—	(15,346)	—	—
Shares purchased under Dividend Reinvestment Plan	—	4,366	—	—
Shares repurchased under Stock Repurchase Program	—	(1,003,792)	—	(1,150,000)
Options exercised	—	5,616	—	—
Conversion of non-voting common stock equivalents
to voting common stock	—	4,500,000	—	(4,500,000)
Number of shares, September 30, 2025	513,250	150,904,772	477,321	4,140,600

	Nine Months Ended September 30, 2024
Non-
Common Stock · Voting · Accumulated
Class B · Common · Additional · Other
Preferred · Non- · Stock · Paid-in · Retained · Comprehensive
	Stock	Voting	Voting	Equivalents	Capital	Deficit	Loss, Net	Total
(Unaudited)
(In thousands, except per share amount)
Balance, December 31, 2023	$498,516	$1,577	$5	$108	$3,840,974	$(518,301)	$(432,114)	$3,390,765
Net earnings	—	—	—	—	—	30,852	—	30,852
Other comprehensive loss,
net of tax	—	—	—	—	—	—	(4,322)	(4,322)
Restricted stock awarded and
earned stock compensation,
net of shares forfeited	—	(1)	—	—	4,657	—	—	4,656
Conversion of non-voting
common stock equivalents
to voting common stock	—	7	—	(7)	—	—	—	—
Restricted stock surrendered	—	—	—	—	(1,238)	—	—	(1,238)
Shares repurchased under
Dividend Reinvestment Plan	—	—	—	—	70	—	—	70
Cash dividends paid:
Preferred stock, $0.4845/share	—	—	—	—	—	(9,947)	—	(9,947)
Common stock, $0.10/share	—	—	—	—	(16,686)	—	—	(16,686)
Balance, March 31, 2024	$498,516	$1,583	$5	$101	$3,827,777	$(497,396)	$(436,436)	$3,394,150
Net earnings	—	—	—	—	—	30,333	—	30,333
Other comprehensive income,
net of tax	—	—	—	—	—	—	7,777	7,777
Restricted stock awarded and
earned stock compensation,
net of shares forfeited	—	—	—	—	3,912	—	—	3,912
Restricted stock surrendered	—	—	—	—	(1,154)	—	—	(1,154)
Shares repurchased under
Dividend Reinvestment Plan	—	—	—	—	78	—	—	78
Cash dividends paid:
Preferred stock, $0.4845/share	—	—	—	—	—	(9,947)	—	(9,947)
Common stock, $0.10/share	—	—	—	—	(17,301)	—	—	(17,301)
Balance, June 30, 2024	$498,516	$1,583	$5	$101	$3,813,312	$(477,010)	$(428,659)	$3,407,848

	Nine Months Ended September 30, 2024
Non-
Common Stock · Voting · Accumulated
Class B · Common · Additional · Other
Preferred · Non- · Stock · Paid-in · Retained · Comprehensive
	Stock	Voting	Voting	Equivalents	Capital	Deficit	Loss, Net	Total
(Unaudited)
(In thousands, except per share amount)
Balance, June 30, 2024	$498,516	$1,583	$5	$101	$3,813,312	$(477,010)	$(428,659)	$3,407,848
Net earnings	—	—	—	—	—	8,784	—	8,784
Other comprehensive income,
net of tax	—	—	—	—	—	—	100,511	100,511
Restricted stock awarded and
earned stock compensation,
net of shares forfeited	—	—	—	—	5,445	—	—	5,445
Conversion of non-voting common
stock equivalents to voting
common stock	—	3	—	(3)	—	—	—	—
Restricted stock surrendered	—	—	—	—	(158)	—	—	(158)
Shares repurchased under
Dividend Reinvestment Plan	—	—	—	—	95	—	—	95
Cash dividends paid:
Preferred stock, $0.4845/share	—	—	—	—	—	(9,947)	—	(9,947)
Common stock, $0.10/share	—	—	—	—	(16,380)	—	—	(16,380)
Balance, September 30, 2024	$498,516	$1,586	$5	$98	$3,802,314	$(478,173)	$(328,148)	$3,496,198

	Nine Months Ended September 30, 2024
Non-Voting
Common Stock · Common
Preferred · Class B · Stock
	Stock	Voting	Non-Voting	Equivalents
(Unaudited)
(In ones)
Number of shares, December 31, 2023	513,250	157,651,752	477,321	10,829,990
Restricted stock awarded and earned stock
compensation, net of shares forfeited	—	67,209	—	—
Restricted stock surrendered	—	(17,364)	—	—
Shares purchased under Dividend Reinvestment Plan	—	4,721	—	—
Conversion of non-voting common stock equivalents
to voting common stock	—	684,390	—	(684,390)
Number of shares, March 31, 2024	513,250	158,390,708	477,321	10,145,600
Restricted stock awarded and earned stock
compensation, net of shares forfeited	—	(66,623)	—	—
Restricted stock surrendered	—	(77,549)	—	—
Shares purchased under Dividend Reinvestment Plan	—	6,255	—	—
Number of shares, June 30, 2024	513,250	158,252,791	477,321	10,145,600
Restricted stock awarded and earned stock
compensation, net of shares forfeited	—	2,001	—	—
Restricted stock surrendered	—	(3,384)	—	—
Shares purchased under Dividend Reinvestment Plan	—	5,237	—	—
Conversion of non-voting common stock equivalents
to voting common stock	—	355,000	—	(355,000)
Number of shares, September 30, 2024	513,250	158,611,645	477,321	9,790,600

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Nine Months Ended
	September 30,
	2025	2024
(Unaudited)
(In thousands)
Cash flows from operating activities:
Net earnings	$151,582	$69,969
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization	37,531	41,199
Amortization of net premiums on investment securities	15,038	18,468
Accretion of net purchased loan discounts and deferred loan fees	(67,217)	(87,108)
Amortization of intangible assets	21,479	25,373
Amortization of operating lease ROU assets	17,672	27,614
Provision for credit losses	58,100	30,000
Gain on sale of foreclosed assets	(92)	(947)
Provision for losses on foreclosed assets	756	1,020
Loss (gain) on sale of loans and leases	133	(625)
Loss on sale of premises and equipment	—	24
Loss on sale of securities	—	59,946
Gain on BOLI death benefit	—	(52)
Unrealized loss (gain) on derivatives, foreign currencies, and credit-linked notes, net	217	(825)
LOCOM HFS adjustment	9	(218)
Earned stock compensation	18,042	14,013
Decrease in other assets	38,418	124,162
Decrease in accrued interest payable and other liabilities	(138,151)	(324,435)
Net cash provided by (used in) operating activities	153,517	(2,422)
Cash flows from investing activities:
Net increase in loans and leases	(744,844)	(399,666)
Proceeds from sales of loans and leases	242,787	2,455,794
Proceeds from maturities and paydowns of securities available-for-sale	330,804	151,634
Proceeds from sales of securities available-for-sale	—	681,888
Purchases of securities available-for-sale	(444,452)	(729,612)
Proceeds from maturities and paydowns of securities held-to-maturity	19,122	1,095
Purchases of FHLB and FRB stock	(16,291)	(20,790)
Redemptions of FHLB and FRB stock	4,727	2,013
Proceeds from sales of foreclosed assets	10,989	14,561
Purchases of premises and equipment	(2,979)	(8,913)
Proceeds from sales of premises and equipment	—	136
Proceeds from BOLI death benefit	1,256	2,074
Net decrease in equipment leased to others under operating leases	6,125	7,152
Net cash (used in) provided by investing activities	(592,756)	2,157,366
Cash flows from financing activities:
Net (decrease) increase in noninterest-bearing deposits	(116,165)	37,542
Net increase (decrease) in interest-bearing deposits	109,021	(3,611,042)
Repayments of borrowings	(176,967)	(2,422,278)
Proceeds from borrowings	790,000	1,100,000
Common shares repurchased under Stock Repurchase Program	(187,727)	—
Common shares purchased under Dividend Reinvestment Plan	214	243
Exercise of options	77	—
Restricted stock surrendered	(3,617)	(2,550)
Preferred stock dividends paid	(29,841)	(29,841)
Common stock dividends paid	(49,703)	(50,367)
Net cash provided by (used in) by financing activities	335,292	(4,978,293)
Net decrease in cash, cash equivalents, and restricted cash	(103,947)	(2,823,349)
Cash, cash equivalents, and restricted cash, beginning of period	2,502,212	5,377,576
Cash, cash equivalents, and restricted cash, end of period	$2,398,265	$2,554,227

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Nine Months Ended
	September 30,
	2025	2024
(Unaudited)
(In thousands)
Supplemental disclosures of cash flow information:
Cash paid for interest	$542,971	$819,859
Cash received for income taxes	(8,062)	(7,160)
Loans transferred to foreclosed assets	6,725	15,564
Transfers from loans held for investment to loans held for sale	448,107	1,930,285
Transfers to loans held for investment from loans held for sale	—	1,179

NOTE 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Banc of California, Inc., a Maryland corporation, was incorporated in March 2002 and serves as the holding company for its wholly owned subsidiary, Banc of California (the “Bank”), a California state-chartered bank and member of the FRB. When we refer to the “holding company," we are referring to Banc of California, Inc., the parent company, on a stand-alone basis. When we refer to “we,” “us,” “our,” or the “Company,” we are referring to Banc of California, Inc. and its consolidated subsidiaries including the Bank, collectively. As a bank holding company, Banc of California, Inc. is subject to ongoing and comprehensive supervision, regulation, examination, and enforcement by the FRB. As a California state-chartered bank and a member of the FRB, the Bank is subject to ongoing and comprehensive supervision, regulation, examination, and enforcement by the DFPI and the FRB. The Bank is also a member of the FHLB system, and its deposit accounts are insured by the Deposit Insurance Fund (the "DIF") of the FDIC.

Banc of California is one of the nation's premier relationship-based business banks, providing banking and treasury management services to small-, middle-market, and venture-backed businesses. The Bank offers a broad range of loan and deposit products and services through full-service branches throughout California and in Denver, Colorado, and Durham, North Carolina, as well as through regional offices nationwide. The Bank also provides full-service payment processing solutions to its clients and serves the Community Association Management industry nationwide with its technology-forward platform, SmartStreet™. The Bank is committed to its local communities through the Banc of California Charitable Foundation, and by supporting organizations that provide financial literacy and job training, small business support, affordable housing, and more.

We generate our revenue primarily from interest received on loans and leases and, to a lesser extent, from interest received on investment securities, and fees received in connection with deposit services, extending credit, and other services offered, including treasury management services. Our major operating expenses are interest paid by the Bank on deposits and borrowings, compensation expense, customer related expense, occupancy expense, information technology and data processing expense, and general operating expenses.

Significant Accounting Policies

Our accounting policies are described in Note 1. Nature of Operations and Summary of Significant Accounting Policies, of our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 as filed with the SEC ("Form 10-K").

Recently Issued Accounting Standards Not Yet Adopted

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures." The standard, among other changes, improves annual income tax disclosures by requiring disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. The enhanced income tax disclosure requirements apply on a prospective basis to annual financial statements for periods beginning after December 15, 2024. However, retrospective application in all prior periods presented is permitted. The Company expects to adopt the standard on a prospective basis and will provide the required enhanced income tax disclosures in its Annual Report on Form 10-K for the year ending December 31, 2025.

In November 2024, the FASB issued ASU 2024-03, "Disaggregation of Income Statement Expenses." The standard, among other changes, requires additional disclosure of the nature of expenses included in the income statement in response to longstanding requests from investors for more information about an entity’s expenses. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The prescribed categories include, among other things, employee compensation, depreciation, and intangible asset amortization. In addition, companies will need to provide qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. In January 2025, the FASB also issued ASU 2025-01, "Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures-Clarifying the Effective Date," which amends the effective date of ASU 2024-03 to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The enhanced income statement expense disclosure requirements apply on a prospective basis. However, retrospective application in all prior periods presented is permitted. The Company is currently evaluating the impact of this update on its consolidated financial statements and related disclosures.

In May 2025, the FASB issued ASU 2025-03,"Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity."The new standard amends the guidance for identifying the accounting acquirer of a variable-interest entity ("VIE") in ASC 805, Business Combinations. Prior to the amendments, the guidance in ASC 805 stipulated that the primary beneficiary of a VIE acquired in a business combination would always be the accounting acquirer. The amendments revise this guidance to require entities to consider the factors in ASC 805-10-55-12 through 55-15 when determining the accounting acquirer in a business combinations that meets both of the following conditions: (1) the transaction is effected primarily by exchanging equity interests; and (2) the legal acquiree is a VIE that meets the definition of a business. This guidance is effective for fiscal years beginning after December 15, 2026 with early adoption permitted. The amendments are required to be applied prospectively to any acquisition transaction that occurs after the initial application date. The Company is currently evaluating the impact of this update on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU 2025-06,"Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software."The new standard clarifies and modernizes the accounting for costs related to internal-use software under ASC 350-40. Specifically, the amendments address the accounting for software developed using iterative and agile development methods, clarify the threshold for when capitalization of software costs should begin, and require that the disclosure requirements under ASC 360-10 apply to capitalized internal-use software costs. This guidance is effective for fiscal years beginning after December 15, 2027, with early adoption permitted. Entities may apply the guidance using one of three transition methods: prospective, modified retrospective (based on the project’s status and whether costs were previously capitalized), or full retrospective application. The Company is currently evaluating the impact of this update on its consolidated financial statements and related disclosures.

Basis of Presentation

The accounting and reporting policies of the Company are in accordance with U.S. generally accepted accounting principles, which we may refer to as U.S. GAAP. In the opinion of management, all significant intercompany accounts and transactions have been eliminated and adjustments, consisting solely of normal recurring accruals and considered necessary for the fair presentation of financial statements, have been included.

The interim condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Form 10-K.

Use of Estimates

The Company has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period to prepare these consolidated financial statements in conformity with U.S. GAAP. Actual results could differ from those estimates. Material estimates subject to change in the near term include, among other items, the allowance for credit losses (the combination of the ALLL and the reserve for unfunded loan commitments), the carrying value of goodwill and other intangible assets, and the realization of deferred tax assets. These estimates may be adjusted as more current information becomes available, and any adjustment may be significant.

NOTE 2. RESTRICTED CASH

The Company is required to maintain reserve balances with the FRBSF. Such reserve requirements are based on a percentage of deposit liabilities and may be satisfied by cash on hand. There wereno average reserves required to be held at the FRBSF for the nine months ended September 30, 2025 and 2024. The following restricted cash balances are included in "Interest-earning deposits in financial institutions" on the condensed consolidated balance sheets. As of September 30, 2025 and December 31, 2024, we pledged cash collateral for our derivative contracts of $14.6 million and $5.3 million. In connection with the issuance of the credit-linked notes on September 29, 2022, we established a correspondent bank account at a third party financial institution as the collateral account for the credit-linked notes. The repayment of principal on the credit-linked notes is secured by this collateral account, which had a balance of $116.6 million at September 30, 2025 and $119.6 million at December 31, 2024. Starting in the second quarter of 2023, we began to pledge cash to secure the standby letters of credit that we have issued on behalf of our customers. As of September 30, 2025 and December 31, 2024, the balance of such restricted cash totaled $39.8 million and $59.3 million.

NOTE 3. INVESTMENT SECURITIES

Securities Available-for-Sale

The following tables present amortized cost, gross unrealized gains and losses, and fair values of AFS securities as of the dates indicated:

	September 30, 2025
Allowance · Gross · Gross
	Amortized	for Credit	Net Carrying	Unrealized	Unrealized	Fair
Security Type	Cost	Losses	Amount	Gains	Losses	Value
(In thousands)
Agency residential MBS	$991,290	$—	$991,290	$—	$(147,135)	$844,155
Agency commercial MBS	52,012	—	52,012	51	(1,181)	50,882
Agency residential CMOs	794,497	—	794,497	3,756	(16,271)	781,982
Corporate debt securities	276,498	(775)	275,723	640	(19,415)	256,948
Private label residential CMOs	286,280	—	286,280	526	(28,113)	258,693
Collateralized loan obligations	205,993	—	205,993	553	(72)	206,474
Private label commercial MBS	10,681	—	10,681	—	(407)	10,274
Asset-backed securities	13,875	—	13,875	7	—	13,882
SBA securities	3,635	—	3,635	—	(191)	3,444
Total (1)	$2,634,761	$(775)	$2,633,986	$5,533	$(212,785)	$2,426,734

(1) Excludes accrued interest receivable of $12.2 million at September 30, 2025 which is recorded in "Other assets" on the condensed consolidated balance sheets.

	December 31, 2024
Gross · Gross
	Amortized	Unrealized	Unrealized	Fair
Security Type	Cost	Gains	Losses	Value
(In thousands)
Agency residential MBS	$1,051,601	$—	$(189,761)	$861,840
Agency commercial MBS	52,610	—	(1,046)	51,564
Agency residential CMOs	467,319	223	(20,911)	446,631
Municipal securities	602	—	(8)	594
Corporate debt securities	289,098	—	(31,386)	257,712
Private label residential CMOs	352,615	7	(35,712)	316,910
Collateralized loan obligations	278,976	469	(29)	279,416
Private label commercial MBS	13,585	—	(1,213)	12,372
Asset-backed securities	15,674	—	(74)	15,600
SBA securities	4,564	—	(364)	4,200
Total (1)	$2,526,644	$699	$(280,504)	$2,246,839

(1) Excludes accrued interest receivable of $12.6 million at December 31, 2024 which is recorded in "Other assets" on the condensed consolidated balance sheets.

As of September 30, 2025, AFS securities with a fair value of $3.4 million were pledged as collateral solely for public deposits.

Realized Gains and Losses on Securities Available-for-Sale

The following table presents the amortized cost of AFS securities sold with related gross realized gains, gross realized losses, and net realized (losses) gains for the periods indicated:

Three Months Ended · Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
(In thousands)
Amortized cost of securities sold	$—	$741,834	$—	$741,834
Gross realized losses	—	(59,946)	—	(59,946)

Unrealized Losses on Securities Available-for-Sale

The following tables present the gross unrealized losses and fair values of AFS securities that were in unrealized loss positions as of the dates indicated:

	September 30, 2025
Less Than 12 Months · 12 Months or More · Total
	Gross		Gross		Gross
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
Security Type	Value	Losses	Value	Losses	Value	Losses
(In thousands)
Agency residential MBS	$—	$—	$844,155	$(147,135)	$844,155	$(147,135)
Agency commercial MBS	4,997	(3)	31,993	(1,178)	36,990	(1,181)
Agency residential CMOs	53,802	(181)	102,342	(16,090)	156,144	(16,271)
Corporate debt securities	3,747	(3)	230,586	(19,412)	234,333	(19,415)
Private label residential CMOs	—	—	127,824	(28,113)	127,824	(28,113)
Collateralized loan obligations	28,765	(72)	—	—	28,765	(72)
Private label commercial MBS	—	—	10,274	(407)	10,274	(407)
SBA securities	—	—	3,444	(191)	3,444	(191)
Total	$91,311	$(259)	$1,350,618	$(212,526)	$1,441,929	$(212,785)

	December 31, 2024
Less Than 12 Months · 12 Months or More · Total
	Gross		Gross		Gross
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
Security Type	Value	Losses	Value	Losses	Value	Losses
(In thousands)
Agency residential MBS	$—	$—	$861,840	$(189,761)	$861,840	$(189,761)
Agency commercial MBS	40,291	(87)	11,273	(959)	51,564	(1,046)
Agency residential CMOs	273,347	(1,994)	104,757	(18,917)	378,104	(20,911)
Municipal securities	—	—	594	(8)	594	(8)
Corporate debt securities	15,968	(32)	241,744	(31,354)	257,712	(31,386)
Private label residential CMOs	180,915	(1,031)	129,178	(34,681)	310,093	(35,712)
Collateralized loan obligations	38,771	(29)	—	—	38,771	(29)
Private label commercial MBS	—	—	12,372	(1,213)	12,372	(1,213)
Asset-backed securities	15,600	(74)	—	—	15,600	(74)
SBA securities	—	—	4,200	(364)	4,200	(364)
Total	$564,892	$(3,247)	$1,365,958	$(277,257)	$1,930,850	$(280,504)

The securities that were in an unrealized loss position at September 30, 2025, were considered impaired and required further review to determine if the unrealized losses were credit-related. As of September 30, 2025, the Company had recorded an allowance for credit losses on AFS securities of $0.8 million on one corporate debt security. Except for the one corporate debt security noted, we concluded the unrealized losses were a result of the level of market interest rates relative to the types of securities and pricing changes caused by shifting supply and demand dynamics and not a result of downgraded credit ratings or other indicators of deterioration of the underlying issuers' ability to repay. We also considered the seniority of the tranches and U.S. government agency guarantees, if any, to assess whether an unrealized loss was credit-related. Further, we do not currently intend to sell any of the securities in an unrealized loss position and it is not more likely than not the Company will be required to sell these securities before their anticipated recovery. As such, we recognized the unrealized losses in "Accumulated other comprehensive loss, net" of "Stockholders' equity" on the condensed consolidated balance sheets.

Contractual Maturities of Securities Available-for-Sale

The following tables present the contractual maturities of our AFS securities portfolio based on amortized cost and fair value as of the dates indicated:

	September 30, 2025
Due After · Due After
Due · One Year · Five Years · Due
Within · Through · Through · After
Security Type	One Year	Five Years	Ten Years	Ten Years	Total
(In thousands)
Amortized Cost:
Agency residential MBS	$—	$—	$—	$991,290	$991,290
Agency commercial MBS	—	40,100	—	11,912	52,012
Agency residential CMOs	—	—	14,093	780,404	794,497
Corporate debt securities	6,750	32,215	237,533	—	276,498
Private label residential CMOs	—	—	—	286,280	286,280
Collateralized loan obligations	—	5,674	93,763	106,556	205,993
Private label commercial MBS	—	—	472	10,209	10,681
Asset-backed securities	—	—	—	13,875	13,875
SBA securities	—	—	3,635	—	3,635
Total	$6,750	$77,989	$349,496	$2,200,526	$2,634,761

	September 30, 2025
Due After · Due After
Due · One Year · Five Years · Due
Within · Through · Through · After
Security Type	One Year	Five Years	Ten Years	Ten Years	Total
(In thousands)
Fair Value:
Agency residential MBS	$—	$—	$—	$844,155	$844,155
Agency commercial MBS	—	40,134	—	10,748	50,882
Agency residential CMOs	—	—	14,271	767,711	781,982
Corporate debt securities	6,750	31,655	218,543	—	256,948
Private label residential CMOs	—	—	—	258,693	258,693
Collateralized loan obligations	—	5,677	93,794	107,003	206,474
Private label commercial MBS	—	—	466	9,808	10,274
Asset-backed securities	—	—	—	13,882	13,882
SBA securities	—	—	3,444	—	3,444
Total	$6,750	$77,466	$330,518	$2,012,000	$2,426,734

CMBS, CMOs, and MBS have contractual maturity dates, but require periodic payments based upon scheduled amortization terms. Actual principal collections on these securities usually occur more rapidly than the scheduled amortization terms because of prepayments made by obligors of the underlying loan collateral.

Securities Held-to-Maturity

The following tables present amortized cost, allowance for credit losses, gross unrealized gains and losses, and fair values of HTM securities as of the dates indicated:

	September 30, 2025
Allowance
for · Net · Gross · Gross
	Amortized	Credit	Carrying	Unrealized	Unrealized	Fair
Security Type	Cost	Losses	Amount	Gains	Losses	Value
(In thousands)
Municipal securities	$1,236,645	$(20)	$1,236,625	$1,285	$(33,921)	$1,203,989
Agency commercial MBS	445,605	—	445,605	—	(20,778)	424,827
Private label commercial MBS	359,091	—	359,091	—	(10,467)	348,624
U.S. Treasury securities	192,255	—	192,255	—	(8,719)	183,536
Corporate debt securities	70,756	(675)	70,081	—	(7,435)	62,646
Total (1)	$2,304,352	$(695)	$2,303,657	$1,285	$(81,320)	$2,223,622

(1)Excludes accrued interest receivable of $11.2 million at September 30, 2025 which is recorded in "Other assets" on the condensed consolidated balance sheets.

	December 31, 2024
Allowance
for · Net · Gross · Gross
	Amortized	Credit	Carrying	Unrealized	Unrealized	Fair
Security Type	Cost	Losses	Amount	Gains	Losses	Value
(In thousands)
Municipal securities	$1,251,364	$(140)	$1,251,224	$35	$(54,799)	$1,196,460
Agency commercial MBS	440,476	—	440,476	—	(37,840)	402,636
Private label commercial MBS	355,342	—	355,342	—	(26,226)	329,116
U.S. Treasury securities	189,985	—	189,985	—	(16,702)	173,283
Corporate debt securities	70,482	(1,360)	69,122	—	(13,923)	55,199
Total (1)	$2,307,649	$(1,500)	$2,306,149	$35	$(149,490)	$2,156,694

(1)Excludes accrued interest receivable of $13.4 million at December 31, 2024 which is recorded in "Other assets" on the condensed consolidated balance sheets.

As of September 30, 2025, HTM securities with an amortized cost of $2.3 billion and a fair value of $2.2 billion were pledged as collateral primarily for the FRB secured line of credit and public deposits.

Allowance for Credit Losses on Securities Held-to-Maturity

Credit losses on HTM securities are recorded at the time of purchase, acquisition, or when the Company designates securities as held-to-maturity. Credit losses on HTM securities are representative of current expected credit losses that may be incurred over the life of the investment. Accrued interest receivable on HTM securities, which is included in "Other assets" on the condensed consolidated balance sheets, is excluded from the estimate of expected credit losses. HTM U.S. treasury securities and agency-backed MBS securities are considered to have no risk of loss as they are either explicitly or implicitly guaranteed by the U.S. government. The change in fair value in the HTM private label CMBS portfolio is solely driven by changes in interest rates. The Company has no knowledge of any underlying credit issues and the cash flows underlying the debt securities have not changed and are not expected to be impacted by changes in interest rates and, thus, there is no related ACL for this portfolio. The underlying bonds in the Company’s HTM municipal securities and HTM corporate debt securities portfolios are evaluated for credit losses in conjunction with management’s estimate of the ACL based primarily on credit ratings, and as of September 30, 2025, the Company had recorded an allowance for credit losses on securities held-to-maturity of $0.7 million.

Securities Held-to-Maturity by Credit Quality Indicator

The Company uses S&P, Moody's, Fitch, Kroll, and Egan Jones ratings as the credit quality indicators for its HTM securities. The following tables present our HTM securities portfolio at amortized cost by the lowest available credit rating as of the dates indicated:

	September 30, 2025
Security Type	AAA	AA+	AA	AA-	BBB	NR	Total
(In thousands)
Amortized Cost:
Municipal securities	$566,931	$363,584	$220,246	$84,175	$1,709	$—	$1,236,645
Agency commercial MBS	—	445,605	—	—	—	—	445,605
Private label commercial MBS	359,091	—	—	—	—	—	359,091
U.S. Treasury securities	—	192,255	—	—	—	—	192,255
Corporate debt securities	—	—	—	—	44,609	26,147	70,756
Total	$926,022	$1,001,444	$220,246	$84,175	$46,318	$26,147	$2,304,352

	December 31, 2024
Security Type	AAA	AA+	AA	AA-	A	BBB	NR	Total
(In thousands)
Amortized Cost:
Municipal securities	$571,347	$369,072	$218,581	$72,952	$1,667	$—	$17,745	$1,251,364
Agency commercial MBS	—	440,476	—	—	—	—	—	440,476
Private label commercial MBS	355,342	—	—	—	—	—	—	355,342
U.S. Treasury securities	—	189,985	—	—	—	—	—	189,985
Corporate debt securities	—	—	—	—	—	44,507	25,975	70,482
Total	$926,689	$999,533	$218,581	$72,952	$1,667	$44,507	$43,720	$2,307,649

Contractual Maturities of Securities Held-to-Maturity

The following tables present the contractual maturities of our HTM securities portfolio based on amortized cost and fair value as of the date indicated:

	September 30, 2025
Due After · Due After
Due · One Year · Five Years · Due
Within · Through · Through · After
Security Type	One Year	Five Years	Ten Years	Ten Years	Total
(In thousands)
Amortized Cost:
Municipal securities	$—	$104,005	$411,923	$720,717	$1,236,645
Agency commercial MBS	—	68,991	376,614	—	445,605
Private label commercial MBS	—	—	37,186	321,905	359,091
U.S. Treasury securities	—	—	192,255	—	192,255
Corporate debt securities	—	—	44,811	25,945	70,756
Total	$—	$172,996	$1,062,789	$1,068,567	$2,304,352

	September 30, 2025
Due After · Due After
Due · One Year · Five Years · Due
Within · Through · Through · After
Security Type	One Year	Five Years	Ten Years	Ten Years	Total
(In thousands)
Fair Value:
Municipal securities	$—	$103,176	$406,416	$694,397	$1,203,989
Agency commercial MBS	—	66,670	358,157	—	424,827
Private label commercial MBS	—	—	36,229	312,395	348,624
U.S. Treasury securities	—	—	183,536	—	183,536
Corporate debt securities	—	—	41,321	21,325	62,646
Total	$—	$169,846	$1,025,659	$1,028,117	$2,223,622

CMBS have contractual maturity dates, but require periodic payments based upon scheduled amortization terms. Actual principal collections on these securities usually occur more rapidly than the scheduled amortization terms because of prepayments made by obligors of the underlying loan collateral.

Interest Income on Investment Securities

The following table presents the composition of our interest income on investment securities for the periods indicated:

Three Months Ended · Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
(In thousands)
Taxable interest	$31,608	$28,576	$93,821	$83,241
Non-taxable interest	4,400	4,622	13,464	14,088
Dividend income	2,283	1,714	6,484	5,722
Total interest income on investment securities	$38,291	$34,912	$113,769	$103,051

NOTE 4. LOANS AND LEASES HELD FOR INVESTMENT

Our loans and leases held for investment are carried at the principal amount outstanding, net of deferred fees and costs, and in the case of acquired and purchased loans, net of purchase discounts and premiums. Deferred fees and costs and purchase discounts and premiums on acquired loans are recognized as an adjustment to interest income over the contractual life of the loans primarily using the effective interest method or taken into income when the related loans are paid off or included in the carrying amount of loans that are sold.

The following table summarizes the composition of our loans and leases held for investment as of the dates indicated:

	September 30,	December 31,
	2025	2024
(In thousands)
Real estate mortgage	$13,696,540	$13,605,595
Real estate construction and land (1)	2,165,789	3,187,146
Commercial	8,021,650	6,788,923
Consumer	367,850	402,254
Total gross loans and leases held for investment	24,251,829	23,983,918
Unearned discounts, net (2)	(108,454)	(175,713)
Deferred fees, net	(32,733)	(26,542)
Total loans and leases held for investment	24,110,642	23,781,663
Allowance for loan and lease losses	(240,501)	(239,360)
Total loans and leases held for investment, net (3)	$23,870,141	$23,542,303

(1)Includes land and acquisition and development loans of $217.7 million and $223.9 million at September 30, 2025 and December 31, 2024.

(2)Represents net acquisition discounts of $175.0 million and purchase premiums of $66.6 million at September 30, 2025, and net acquisition discounts of $235.2 million and purchase premiums of $59.5 million at December 31, 2024.

(3)Excludes accrued interest receivable of $99.1 million and $96.8 million at September 30, 2025 and December 31, 2024, respectively, which is recorded in "Other assets" on the condensed consolidated balance sheets.

The following tables present an aging analysis of our loans and leases held for investment by loan portfolio segment and class as of the dates indicated:

	September 30, 2025
	30 - 89	90 or More
Days · Days · Total
Past Due · Past Due · Past Due · Current · Total
(In thousands)
Real estate mortgage:
Commercial	$3,197		$51,231	$54,428	$4,238,197	$4,292,625
Multi-family	—		—	—	6,124,673	6,124,673
Other residential	46,026		52,666	98,692	3,063,872	3,162,564
Total real estate mortgage	49,223		103,897	153,120	13,426,742	13,579,862
Real estate construction and land:
Commercial	—		—	—	395,150	395,150
Residential	—		—	—	1,759,676	1,759,676
Total real estate construction and land	—		—	—	2,154,826	2,154,826
Commercial:
Asset-based	—		—	—	2,742,519	2,742,519
Venture capital	—		—	—	1,907,601	1,907,601
Other commercial	4,460		203	4,663	3,351,874	3,356,537
Total commercial	4,460		203	4,663	8,001,994	8,006,657
Consumer	2,733		852	3,585	365,712	369,297
Total	$56,416		$104,952	$161,368	$23,949,274	$24,110,642

	December 31, 2024
	30 - 89	90 or More
Days · Days · Total
Past Due · Past Due · Past Due · Current · Total
(In thousands)
Real estate mortgage:
Commercial	$27,700		$22,561	$50,261	$4,528,511	$4,578,772
Multi-family	10,346		21,860	32,206	6,009,507	6,041,713
Other residential	39,873		36,976	76,849	2,730,325	2,807,174
Total real estate mortgage	77,919		81,397	159,316	13,268,343	13,427,659
Real estate construction and land:
Commercial	—		—	—	799,131	799,131
Residential	—		—	—	2,373,162	2,373,162
Total real estate construction and land	—		—	—	3,172,293	3,172,293
Commercial:
Asset-based	1,795		—	1,795	2,086,174	2,087,969
Venture capital	5,534		—	5,534	1,532,242	1,537,776
Other commercial	3,295		6,956	10,251	3,142,833	3,153,084
Total commercial	10,624		6,956	17,580	6,761,249	6,778,829
Consumer	2,804		493	3,297	399,585	402,882
Total	$91,347		$88,846	$180,193	$23,601,470	$23,781,663

It is our policy to discontinue accruing interest when principal or interest payments are past due 90 days or more (unless the loan is both well secured and in the process of collection) or when, in the opinion of management, there is a reasonable doubt as to the collectability of a loan or lease in the normal course of business. Interest income on nonaccrual loans is recognized only to the extent cash is received and the principal balance of the loan is deemed collectable.

The following table presents our nonaccrual and performing loans and leases held for investment by loan portfolio segment and class as of the dates indicated:

	September 30, 2025			December 31, 2024
	Nonaccrual	Performing	Total	Nonaccrual	Performing	Total
(In thousands)
Real estate mortgage:
Commercial	$99,103	$4,193,522	$4,292,625	$97,655	$4,481,117	$4,578,772
Multi-family	841	6,123,832	6,124,673	22,763	6,018,950	6,041,713
Other residential	66,866	3,095,698	3,162,564	46,788	2,760,386	2,807,174
Total real estate mortgage	166,810	13,413,052	13,579,862	167,206	13,260,453	13,427,659
Real estate construction and land:
Commercial	—	395,150	395,150	—	799,131	799,131
Residential	—	1,759,676	1,759,676	—	2,373,162	2,373,162
Total real estate construction and land	—	2,154,826	2,154,826	—	3,172,293	3,172,293
Commercial:
Asset-based	103	2,742,416	2,742,519	1,940	2,086,029	2,087,969
Venture capital	—	1,907,601	1,907,601	6,291	1,531,485	1,537,776
Other commercial	6,676	3,349,861	3,356,537	13,544	3,139,540	3,153,084
Total commercial	6,779	7,999,878	8,006,657	21,775	6,757,054	6,778,829
Consumer	952	368,345	369,297	624	402,258	402,882
Total	$174,541	$23,936,101	$24,110,642	$189,605	$23,592,058	$23,781,663

At September 30, 2025, nonaccrual loans and leases included $105.0 million of loans and leases 90 or more days past due, $11.0 million of loans and leases 30 to 89 days past due, and $58.6 million of loans and leases current with respect to contractual payments that were placed on nonaccrual status based on management’s judgment regarding their collectability. At December 31, 2024, nonaccrual loans and leases included $88.8 million of loans and leases 90 or more days past due, $40.6 million of loans and leases 30 to 89 days past due, and $60.2 million of current loans and leases that were placed on nonaccrual status based on management’s judgment regarding their collectability.

As of September 30, 2025, our three largest loan relationships on nonaccrual status had an aggregate carrying value of $47.0 million and represented 27% of total nonaccrual loans and leases.

The following tables present the credit risk rating categories for loans and leases held for investment by loan portfolio segment and class as of the dates indicated. Classified loans and leases are those with a credit risk rating of either substandard or doubtful.

	September 30, 2025
	Classified	Special Mention	Pass	Total
(In thousands)
Real estate mortgage:
Commercial	$298,208	$109,921	$3,884,496	$4,292,625
Multi-family	182,431	153,360	5,788,882	6,124,673
Other residential	66,944	—	3,095,620	3,162,564
Total real estate mortgage	547,583	263,281	12,768,998	13,579,862
Real estate construction and land:
Commercial	—	81,400	313,750	395,150
Residential	2,985	8,276	1,748,415	1,759,676
Total real estate construction and land	2,985	89,676	2,062,165	2,154,826
Commercial:
Asset-based	71,377	7,143	2,663,999	2,742,519
Venture capital	123,392	103,725	1,680,484	1,907,601
Other commercial	16,865	36,466	3,303,206	3,356,537
Total commercial	211,634	147,334	7,647,689	8,006,657
Consumer	1,380	5,688	362,229	369,297
Total	$763,582	$505,979	$22,841,081	$24,110,642

	December 31, 2024
	Classified	Special Mention	Pass	Total
(In thousands)
Real estate mortgage:
Commercial	$301,278	$348,014	$3,929,480	$4,578,772
Multi-family	113,164	202,690	5,725,859	6,041,713
Other residential	47,993	14,351	2,744,830	2,807,174
Total real estate mortgage	462,435	565,055	12,400,169	13,427,659
Real estate construction and land:
Commercial	—	148,024	651,107	799,131
Residential	—	203,220	2,169,942	2,373,162
Total real estate construction and land	—	351,244	2,821,049	3,172,293
Commercial:
Asset-based	5,003	9,547	2,073,419	2,087,969
Venture capital	75,406	125,320	1,337,050	1,537,776
Other commercial	19,949	38,741	3,094,394	3,153,084
Total commercial	100,358	173,608	6,504,863	6,778,829
Consumer	709	7,408	394,765	402,882
Total	$563,502	$1,097,315	$22,120,846	$23,781,663

The following table presents our nonaccrual loans and leases by loan portfolio segment and class and by with and without an allowance recorded as of the date indicated and interest income recognized on nonaccrual loans and leases for the periods indicated:

Three Months · Nine Months · Three Months · Nine Months
Ended · Ended · Ended · Ended
	September 30,	September 30,	September 30,	September 30,	September 30,	September 30,
	2025	2025	2025	2024	2024	2024
	Nonaccrual	Interest	Interest	Nonaccrual	Interest	Interest
	Recorded	Income	Income	Recorded	Income	Income
	Investment	Recognized	Recognized	Investment	Recognized	Recognized
(In thousands)
With An Allowance Recorded:
Real estate mortgage:
Commercial	$132	$—	$—	$201	$—	$—
Multi-family	—	—	—	—	—	—
Other residential	—	—	—	232	—	—
Real estate construction and land:
Commercial	—	—	—	—	—	—
Residential	—	—	—	—	—	—
Commercial:
Asset-based	103	—	—	—	—	—
Venture capital	—	—	—	19,957	—	—
Other commercial	1,696	—	—	6,950	—	—
Consumer	621	—	—	519	—	—
With No Related Allowance
Recorded:
Real estate mortgage:
Commercial	$98,971	$3	$9	$78,277	$3	$10
Multi-family	841	—	—	916	—	—
Other residential	66,866	—	—	50,282	—	—
Real estate construction and land:
Commercial	—	—	—	—	—	—
Residential	—	—	—	—	—	—
Commercial:
Asset-based	—	—	—	2,295	—	—
Venture capital	—	—	—	—	—	—
Other commercial	4,980	—	—	8,712	—	—
Consumer	331	—	—	—	—	—
Total Loans and Leases With and
Without an Allowance Recorded:
Real estate mortgage	$166,810	$3	$9	$129,908	$3	$10
Real estate construction and land	—	—	—	—	—	—
Commercial	6,779	—	—	37,914	—	—
Consumer	952	—	—	519	—	—
Total	$174,541	$3	$9	$168,341	$3	$10

The following tables present our loans held for investment by loan portfolio segment and class, by credit quality indicator (internal risk ratings), and by year of origination (vintage year) as of the dates indicated:

Revolving
Converted
Amortized Cost Basis (1) · Term Loans by Origination Year · Revolving · to Term
September 30, 2025	2025	2024	2023	2022	2021	Prior	Loans	Loans	Total
(In thousands)
Real Estate Mortgage:
Commercial
Internal risk rating:
1-2 High pass	$—	$185	$2,801	$22,049	$28,275	$100,144	$—	$—	$153,454
3-4.5 Pass	302,297	184,125	123,521	790,669	645,613	1,615,505	63,897	5,415	3,731,042
5 Special mention	—	9,958	—	22,241	29,638	25,049	—	23,035	109,921
6-8 Classified	—	13,949	27,531	58,203	55,259	143,266	—	—	298,208
Total	$302,297	$208,217	$153,853	$893,162	$758,785	$1,883,964	$63,897	$28,450	$4,292,625
Current YTD period:
Gross charge-offs	$—	$—	$51	$731	$613	$16,650	$—	$—	$18,045
Real Estate Mortgage:
Multi-family
Internal risk rating:
1-2 High pass	$—	$—	$—	$54,729	$175,810	$147,678	$—	$—	$378,217
3-4.5 Pass	319,440	160,618	56,158	2,157,112	1,143,518	1,563,712	10,107	—	5,410,665
5 Special mention	10,495	—	3,807	99,644	21,911	17,503	—	—	153,360
6-8 Classified	—	19,977	—	64,973	28,358	69,123	—	—	182,431
Total	$329,935	$180,595	$59,965	$2,376,458	$1,369,597	$1,798,016	$10,107	$—	$6,124,673
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$—	$3,275	$—	$—	$3,275
Real Estate Mortgage:
Other residential
Internal risk rating:
1-2 High pass	$—	$—	$—	$—	$—	$—	$—	$—	$—
3-4.5 Pass	521,387	29,086	22,128	278,636	2,058,439	95,965	89,979	—	3,095,620
5 Special mention	—	—	—	—	—	—	—	—	—
6-8 Classified	1,735	—	967	37,949	25,439	854	—	—	66,944
Total	$523,122	$29,086	$23,095	$316,585	$2,083,878	$96,819	$89,979	$—	$3,162,564
Current YTD period:
Gross charge-offs	$—	$—	$97	$2,176	$731	$—	$—	$—	$3,004

Revolving
Converted
Amortized Cost Basis (1) · Term Loans by Origination Year · Revolving · to Term
September 30, 2025	2025	2024	2023	2022	2021	Prior	Loans	Loans	Total
(In thousands)
Real Estate Construction
and Land: Commercial
Internal risk rating:
1-2 High pass	$—	$—	$—	$—	$—	$—	$—	$—	$—
3-4.5 Pass	99,130	46,768	59,802	44,290	37,163	26,597	—	—	313,750
5 Special mention	—	—	—	50,345	31,055	—	—	—	81,400
6-8 Classified	—	—	—	—	—	—	—	—	—
Total	$99,130	$46,768	$59,802	$94,635	$68,218	$26,597	$—	$—	$395,150
Current YTD period:
Gross charge-offs	$—	$—	$—	$20,196	$1,340	$—	$—	$—	$21,536
Real Estate Construction
and Land: Residential
Internal risk rating:
1-2 High pass	$—	$—	$—	$—	$—	$—	$—	$—	$—
3-4.5 Pass	65,735	155,852	189,285	903,353	271,324	78,873	83,993	—	1,748,415
5 Special mention	—	—	—	4,251	4,025	—	—	—	8,276
6-8 Classified	—	—	—	—	2,985	—	—	—	2,985
Total	$65,735	$155,852	$189,285	$907,604	$278,334	$78,873	$83,993	$—	$1,759,676
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$—	$—	$—	$—	$—
Commercial: Asset-Based
Internal risk rating:
1-2 High pass	$13,033	$32,057	$25,235	$125,841	$190,815	$206,364	$175,059	$—	$768,404
3-4.5 Pass	284,450	43,676	80,792	150,396	77,076	9,182	1,250,023	—	1,895,595
5 Special mention	—	—	—	—	—	—	7,143	—	7,143
6-8 Classified	—	—	194	5,565	37,977	—	27,641	—	71,377
Total	$297,483	$75,733	$106,221	$281,802	$305,868	$215,546	$1,459,866	$—	$2,742,519
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$—	$—	$—	$—	$—
Commercial: Venture
Capital
Internal risk rating:
1-2 High pass	$(278)	$(89)	$(62)	$—	$414	$—	$80,610	$22,134	$102,729
3-4.5 Pass	89,864	94,937	96,894	19,432	37,674	17,708	1,142,538	78,708	1,577,755
5 Special mention	—	33,806	12,831	19,930	18,739	—	18,419	—	103,725
6-8 Classified	1,617	14,893	14,340	24,062	13,281	—	41,194	14,005	123,392
Total	$91,203	$143,547	$124,003	$63,424	$70,108	$17,708	$1,282,761	$114,847	$1,907,601
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$5,257	$—	$—	$—	$5,257

Revolving
Converted
Amortized Cost Basis (1) · Term Loans by Origination Year · Revolving · to Term
September 30, 2025	2025	2024	2023	2022	2021	Prior	Loans	Loans	Total
(In thousands)
Commercial: Other
Commercial
Internal risk rating:
1-2 High pass	$246	$942	$191	$20,315	$1,276	$(14)	$56,188	$(1)	$79,143
3-4.5 Pass	191,980	52,235	63,375	54,606	173,239	149,507	2,506,584	32,537	3,224,063
5 Special mention	—	—	9,498	5,587	10,197	180	10,212	792	36,466
6-8 Classified	—	3,051	—	3,046	79	1,642	7,706	1,341	16,865
Total	$192,226	$56,228	$73,064	$83,554	$184,791	$151,315	$2,580,690	$34,669	$3,356,537
Current YTD period:
Gross charge-offs	$—	$—	$1,394	$727	$228	$2,021	$11,177	$423	$15,970
Consumer
Internal risk rating:
1-2 High pass	$—	$—	$—	$15	$9	$—	$719	$—	$743
3-4.5 Pass	20,800	26,679	14,478	52,400	155,605	84,812	6,569	143	361,486
5 Special mention	—	—	—	1,437	3,474	777	—	—	5,688
6-8 Classified	—	—	—	484	175	716	—	5	1,380
Total	$20,800	$26,679	$14,478	$54,336	$159,263	$86,305	$7,288	$148	$369,297
Current YTD period:
Gross charge-offs	$—	$—	$—	$609	$1,156	$1,110	$1	$1	$2,877
Total Loans and Leases
Internal risk rating:
1-2 High pass	$13,001	$33,095	$28,165	$222,949	$396,599	$454,172	$312,576	$22,133	$1,482,690
3-4.5 Pass	1,895,083	793,976	706,433	4,450,894	4,599,651	3,641,861	5,153,690	116,803	21,358,391
5 Special mention	10,495	43,764	26,136	203,435	119,039	43,509	35,774	23,827	505,979
6-8 Classified	3,352	51,870	43,032	194,282	163,553	215,601	76,541	15,351	763,582
Total	$1,921,931	$922,705	$803,766	$5,071,560	$5,278,842	$4,355,143	$5,578,581	$178,114	$24,110,642
Current YTD period:
Gross charge-offs	$—	$—	$1,542	$24,439	$9,325	$23,056	$11,178	$424	$69,964

Revolving
Converted
Amortized Cost Basis (1) · Term Loans by Origination Year · Revolving · to Term
December 31, 2024	2024	2023	2022	2021	2020	Prior	Loans	Loans	Total
(In thousands)
Real Estate Mortgage:
Commercial
Internal risk rating:
1-2 High pass	$1,694	$—	$26,166	$22,821	$8,089	$78,588	$1	$—	$137,359
3-4.5 Pass	232,808	132,389	800,877	682,806	450,822	1,407,314	56,481	28,624	3,792,121
5 Special mention	—	23,844	123,589	24,364	—	176,217	—	—	348,014
6-8 Classified	13,587	1,765	27,579	68,488	20,853	169,006	—	—	301,278
Total	$248,089	$157,998	$978,211	$798,479	$479,764	$1,831,125	$56,482	$28,624	$4,578,772
Current YTD period:
Gross charge-offs	$—	$—	$175	$12,217	$9,714	$1,481	$—	$—	$23,587
Real Estate Mortgage:
Multi-family
Internal risk rating:
1-2 High pass	$—	$—	$55,847	$214,583	$62,942	$129,163	$—	$—	$462,535
3-4.5 Pass	223,333	60,137	2,037,864	1,154,452	451,602	1,324,816	11,120	—	5,263,324
5 Special mention	—	—	112,963	35,065	—	40,262	—	14,400	202,690
6-8 Classified	—	—	40,018	33,877	4,751	34,518	—	—	113,164
Total	$223,333	$60,137	$2,246,692	$1,437,977	$519,295	$1,528,759	$11,120	$14,400	$6,041,713
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$—	$—	$—	$—	$—
Real Estate Mortgage:
Other residential
Internal risk rating:
1-2 High pass	$—	$—	$—	$—	$—	$—	$3,510	$—	$3,510
3-4.5 Pass	(562)	31,318	336,719	2,235,006	53,094	43,510	42,158	77	2,741,320
5 Special mention	—	310	8,121	5,644	—	276	—	—	14,351
6-8 Classified	—	3,571	25,616	17,189	—	1,448	169	—	47,993
Total	$(562)	$35,199	$370,456	$2,257,839	$53,094	$45,234	$45,837	$77	$2,807,174
Current YTD period:
Gross charge-offs	$—	$3,445	$29,099	$6,394	$350	$67	$175	$—	$39,530

Revolving
Converted
Amortized Cost Basis (1) · Term Loans by Origination Year · Revolving · to Term
December 31, 2024	2024	2023	2022	2021	2020	Prior	Loans	Loans	Total
(In thousands)
Real Estate Construction
and Land: Commercial
Internal risk rating:
1-2 High pass	$—	$—	$—	$—	$—	$—	$—	$—	$—
3-4.5 Pass	29,674	47,183	404,732	115,729	45,576	8,213	—	—	651,107
5 Special mention	10,501	—	—	111,933	—	—	25,590	—	148,024
6-8 Classified	—	—	—	—	—	—	—	—	—
Total	$40,175	$47,183	$404,732	$227,662	$45,576	$8,213	$25,590	$—	$799,131
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$—	$—	$—	$—	$—
Real Estate Construction
and Land: Residential
Internal risk rating:
1-2 High pass	$—	$—	$—	$—	$—	$—	$—	$—	$—
3-4.5 Pass	97,488	194,405	1,113,955	436,335	224,511	—	103,248	—	2,169,942
5 Special mention	—	—	143,136	60,084	—	—	—	—	203,220
6-8 Classified	—	—	—	—	—	—	—	—	—
Total	$97,488	$194,405	$1,257,091	$496,419	$224,511	$—	$103,248	$—	$2,373,162
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$—	$—	$—	$—	$—
Commercial: Asset-Based
Internal risk rating:
1-2 High pass	$39,542	$37,081	$163,918	$222,942	$15,730	$251,167	$195,994	$—	$926,374
3-4.5 Pass	100,098	88,514	180,433	68,372	9,653	34,331	618,036	47,608	1,147,045
5 Special mention	—	194	5,569	—	—	—	3,784	—	9,547
6-8 Classified	—	—	—	—	—	—	5,003	—	5,003
Total	$139,640	$125,789	$349,920	$291,314	$25,383	$285,498	$822,817	$47,608	$2,087,969
Current YTD period:
Gross charge-offs	$—	$—	$—	$—	$92	$—	$—	$—	$92
Commercial: Venture
Capital
Internal risk rating:
1-2 High pass	$(92)	$(100)	$—	$414	$2,101	$—	$72,745	$23,426	$98,494
3-4.5 Pass	100,854	104,022	79,659	76,224	3,784	17,749	777,199	79,065	1,238,556
5 Special mention	1,396	56,973	(1)	29,973	—	—	36,979	—	125,320
6-8 Classified	14,895	—	12,821	20,182	—	—	27,508	—	75,406
Total	$117,053	$160,895	$92,479	$126,793	$5,885	$17,749	$914,431	$102,491	$1,537,776
Current YTD period:
Gross charge-offs	$—	$2,272	$—	$14,000	$—	$2	$140	$—	$16,414

Revolving
Converted
Amortized Cost Basis (1) · Term Loans by Origination Year · Revolving · to Term
December 31, 2024	2024	2023	2022	2021	2020	Prior	Loans	Loans	Total
(In thousands)
Commercial: Other
Commercial
Internal risk rating:
1-2 High pass	$685	$241	$20,873	$3,360	$10	$(83)	$73,596	$—	$98,682
3-4.5 Pass	66,097	98,878	117,846	199,252	39,244	160,030	2,252,507	61,858	2,995,712
5 Special mention	6,462	8,912	2,880	144	—	127	20,073	143	38,741
6-8 Classified	—	1,397	1,243	2,365	—	5,836	8,234	874	19,949
Total	$73,244	$109,428	$142,842	$205,121	$39,254	$165,910	$2,354,410	$62,875	$3,153,084
Current YTD period:
Gross charge-offs	$—	$—	$1,144	$500	$1,696	$3,159	$2,712	$605	$9,816
Consumer
Internal risk rating:
1-2 High pass	$—	$—	$20	$15	$1	$—	$932	$—	$968
3-4.5 Pass	31,034	19,181	59,594	176,189	18,658	82,678	6,231	232	393,797
5 Special mention	—	—	1,327	4,179	142	1,760	—	—	7,408
6-8 Classified	—	—	32	283	34	350	—	10	709
Total	$31,034	$19,181	$60,973	$180,666	$18,835	$84,788	$7,163	$242	$402,882
Current YTD period:
Gross charge-offs	$—	$198	$790	$2,733	$352	$1,427	$4	$—	$5,504
Total Loans and Leases
Internal risk rating:
1-2 High pass	$41,829	$37,222	$266,824	$464,135	$88,873	$458,835	$346,778	$23,426	$1,727,922
3-4.5 Pass	880,824	776,027	5,131,679	5,144,365	1,296,944	3,078,641	3,866,980	217,464	20,392,924
5 Special mention	18,359	90,233	397,584	271,386	142	218,642	86,426	14,543	1,097,315
6-8 Classified	28,482	6,733	107,309	142,384	25,638	211,158	40,914	884	563,502
Total	$969,494	$910,215	$5,903,396	$6,022,270	$1,411,597	$3,967,276	$4,341,098	$256,317	$23,781,663
Current YTD period:
Gross charge-offs	$—	$5,915	$31,208	$35,844	$12,204	$6,136	$3,031	$605	$94,943

Loan Modifications

The following tables present our loan modifications made to borrowers experiencing financial difficulty by type of modification for the periods indicated with related amortized cost balances as of the dates indicated:

	Three Months Ended September 30, 2025
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2025
Interest Rate · Total Loan
Term Extension · Payment Delay · Reduction · Modifications
% of · % of · % of · % of
Loan · Loan · Loan · Loan
	Portfolio		Portfolio		Portfolio		Portfolio
	Balance	Class	Balance	Class	Balance	Class	Balance	Class
(Dollars in thousands)
Real estate mortgage:
Commercial	$115,256	2.7%	$—	—%	$3,349	0.1%	$118,605	2.8%
Multi-family	67,446	1.1%	—	—%	—	—%	67,446	1.1%
Other residential	1,445	—%	—	—%	—	—%	1,445	—%
Real estate construction and land:
Residential	2,985	0.2%	—	—%	—	—%	2,985	0.2%
Commercial:
Asset-based	37,977	1.4%	—	—%	—	—%	37,977	1.4%
Venture capital	38,599	2.0%	14,893	0.8%	—	—%	53,492	2.8%
Other commercial	179	—%	—	—%	—	—%	179	—%
Total	$263,887		$14,893		$3,349		$282,129

	Nine Months Ended September 30, 2025
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2025
	Combination - Term
Interest Rate · Extension and
Term Extension · Payment Delay · Reduction · Rate Reduction
% of · % of · % of · % of
Loan · Loan · Loan · Loan
	Portfolio		Portfolio		Portfolio		Portfolio
	Balance	Class	Balance	Class	Balance	Class	Balance	Class
(Dollars in thousands)
Real estate mortgage:
Commercial	$115,256	2.7%	$3,582	0.1%	$5,933	0.1%	$—	—%
Multi-family	67,446	1.1%	—	—%	—	—%	—	—%
Other residential	2,417	0.1%	2,197	0.1%	—	—%	—	—%
Real estate construction and land:
Residential	2,985	0.2%	—	—%	—	—%	—	—%
Commercial:
Asset-based	62,510	2.3%	—	—%	—	—%	—	—%
Venture capital	45,995	2.4%	14,893	0.8%	—	—%	—	—%
Other commercial	4,358	0.1%	—	—%	—	—%	532	—%
Consumer	5	—%	—	—%	—	—%	—	—%
Total	$300,972		$20,672		$5,933		$532

	Nine Months Ended September 30, 2025
	Loan Modifications (continued)
	Balances (Amortized Cost Basis) at
	September 30, 2025
Combination - Term · Combination - Term
Extension, · Extension,
Rate Reduction · and Principal · Total Loan
and Payment Delay · Forgiveness · Modifications
% of · % of · % of
Loan · Loan · Loan
	Portfolio		Portfolio		Portfolio
	Balance	Class	Balance	Class	Balance	Class
(Dollars in thousands)
Real estate mortgage:
Commercial	$—	—%	$—	—%	$124,771	2.9%
Multi-family	—	—%	—	—%	67,446	1.1%
Other residential	—	—%	—	—%	4,614	0.1%
Real estate construction and land:
Residential	—	—%	—	—%	2,985	0.2%
Commercial:
Asset-based	—	—%	—	—%	62,510	2.3%
Venture capital	—	—%	—	—%	60,888	3.2%
Other commercial	136	—%	4	—%	5,030	0.1%
Consumer	—	—%	—	—%	5	—%
Total	$136		$4		$328,249

	Three Months Ended September 30, 2024
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2024
	Combination - Term
Extension and · Total Loan
Term Extension · Payment Delay · Payment Delay · Modifications
% of · % of · % of · % of
Loan · Loan · Loan · Loan
	Portfolio		Portfolio		Portfolio		Portfolio
	Balance	Class	Balance	Class	Balance	Class	Balance	Class
(Dollars in thousands)
Real estate mortgage:
Commercial	$93,551	2.1%	$45,957	1.0%	$—	—%	$139,508	3.1%
Other residential	1,528	0.1%	—	—%	—	—%	1,528	0.1%
Commercial:
Asset-based	2,195	0.1%	—	—%	—	—%	2,195	0.1%
Venture capital	—	—%	—	—%	13,156	1.0%	13,156	1.0%
Other commercial	2,141	0.1%	—	—%	—	—%	2,141	0.1%
Total	$99,415		$45,957		$13,156		$158,528

	Nine Months Ended September 30, 2024
	Loan Modifications
	Balances (Amortized Cost Basis) at
	September 30, 2024
Combination - Term · Combination - Term
Extension and · Extension and · Total Loan
Term Extension · Payment Delay · Principal Forgiveness · Payment Delay · Modifications
% of · % of · % of · % of · % of
Loan · Loan · Loan · Loan · Loan
	Portfolio		Portfolio		Portfolio		Portfolio		Portfolio
	Balance	Class	Balance	Class	Balance	Class	Balance	Class	Balance	Class
(Dollars in thousands)
Real estate mortgage:
Commercial	$94,690	2.1%	$60,117	1.3%	$13,500	0.3%	$—	—%	$168,307	3.7%
Other residential	5,092	0.2%	—	—%	—	—%	—	—%	5,092	0.2%
Commercial:
Asset-based	2,195	0.1%	—	—%	—	—%	—	—%	2,195	0.1%
Venture capital	—	—%	—	—%	—	—%	13,156	1.0%	13,156	1.0%
Other commercial	2,386	0.1%	—	—%	—	—%	45	—%	2,431	0.1%
Consumer	11	—%	—	—%	—	—%	—	—%	11	—%
Total	$104,374		$60,117		$13,500		$13,201		$191,192

The following tables present the financial effect of our loan modifications made to borrowers experiencing financial difficulty by type of modification for the periods indicated:

Real estate mortgage:
	Three Months Ended September 30, 2025
	Term Extension - Financial Effect
Commercial	Extended maturity by a weighted average 16 months.
Multi-family	Extended maturity by a weighted average 12 months.
Other residential	Extended maturity by a weighted average 9 months.
Real estate construction and land:
Residential	Extended maturity by a weighted average 9 months.
Commercial:
Asset-based	Extended maturity by a weighted average 6 months.
Venture capital	Extended maturity by a weighted average 7 months.
Other commercial	Extended maturity by a weighted average 60 months.

Commercial:
	Three Months Ended September 30, 2025
	Payment Delay - Financial Effect
Venture capital	Granted payment deferrals for a weighted average of 3 months.

Real estate mortgage:
	Three Months Ended September 30, 2025
	Interest Rate Reduction - Financial Effect
Commercial	Reduced interest rates by a weighted average 3.15% for a weighted average period of 20 months.

Real estate mortgage:
	Nine Months Ended September 30, 2025
	Term Extension - Financial Effect
Commercial	Extended maturity by a weighted average 16 months.
Multi-family	Extended maturity by a weighted average 12 months.
Other residential	Extended maturity by a weighted average 9 months.
Real estate construction and land:
Residential	Extended maturity by a weighted average 9 months.
Commercial:
Asset-based	Extended maturity by a weighted average 22 months.
Venture capital	Extended maturity by a weighted average 8 months.
Other commercial	Extended maturity by a weighted average 18 months.
Consumer	Extended maturity by a weighted average 24 months.

Real estate mortgage:
	Nine Months Ended September 30, 2025
	Payment Delay - Financial Effect
Commercial	Granted payment deferrals for a weighted average of 4 months.
Other residential	Granted payment deferrals for a weighted average of 3 months.
Commercial:
Venture capital	Granted payment deferrals for a weighted average of 3 months.

Real estate mortgage:
	Nine Months Ended September 30, 2025
	Interest Rate Reduction - Financial Effect
Commercial	Reduced interest rates by a weighted average 3.21% for a weighted average period of 17 months.

Commercial:
	Nine Months Ended September 30, 2025
	Combination - Term Extension and Rate Reduction - Financial Effect
Other commercial	Extended maturity by a weighted average 4.6 years and reduced interest rates by a weighted average 1.93%.

Commercial:
	Nine Months Ended September 30, 2025
	Term Extension, Rate Reduction and Payment Delay - Financial Effect
Other commercial	Extended maturity by a weighted average 5.1 years, reduced interest rates by a weighted average 5.75%, and granted payment deferrals for a weighted average of 3 months.

Commercial:
	Nine Months Ended September 30, 2025
	Combination - Term Extension and Principal Forgiveness - Financial Effect
Other commercial	Extended maturity by a weighted average 2.9 years and forgave principal balances totaling $64,000.

Real estate mortgage:
	Three Months Ended September 30, 2024
	Term Extension - Financial Effect
Commercial	Extended maturity by a weighted average 15 months.
Other residential	Extended maturity by a weighted average 8 months.
Commercial:
Asset-based	Extended maturity by a weighted average 4 months.
Other commercial	Extended maturity by a weighted average 14 months.

Real estate mortgage:
	Three Months Ended September 30, 2024
	Payment Delay - Financial Effect
Commercial	Deferred partial payments by a weighted average 24 months.

Commercial:
	Three Months Ended September 30, 2024
	Combination - Term Extension and Payment Delay - Financial Effect
Venture capital	Extended maturity by a weighted average 3 months and granted 3 months of payment deferrals.

Real estate mortgage:
	Nine Months Ended September 30, 2024
	Term Extension - Financial Effect
Commercial	Extended maturity by a weighted average 15 months.
Other residential	Extended maturity by a weighted average 10 months.
Commercial:
Asset-based	Extended maturity by a weighted average 4 months.
Other commercial	Extended maturity by a weighted average 15 months.
Consumer	Extended maturity by a weighted average 12 months.

Real estate mortgage:
	Nine Months Ended September 30, 2024
	Payment Delay - Financial Effect
Commercial	Deferred partial payments by a weighted average 20 months.

Real estate mortgage:
	Nine Months Ended September 30, 2024
	Combination - Term Extension and Principal Forgiveness - Financial Effect
Commercial	Extended maturity by a weighted average 3 years and granted principal forgiveness totaling $4.0 million.

Commercial:
	Nine Months Ended September 30, 2024
	Combination - Term Extension and Payment Delay - Financial Effect
Venture capital	Extended maturity by a weighted average 3 months and granted 3 months of payment deferrals.
Other commercial	Extended maturity by a weighted average 10 years and granted 4 months of payment deferrals.

The following tables present the payment status of loans that were modified during the preceding 12-month period, with related amortized cost balances, as of the dates indicated:

	Payment Status (Amortized Cost Basis) at
	September 30, 2025
30-89 Days · 90 or More Days
	Current	Past Due	Past Due	Total
(In thousands)
Real estate mortgage:
Commercial	$142,746	$—	$—	$142,746
Multi-family	67,446	—	—	67,446
Other residential	2,104	971	2,197	5,272
Real estate construction and land:
Residential	2,985	—	—	2,985
Commercial:
Asset-based	62,510	—	—	62,510
Venture capital	66,617	—	—	66,617
Other commercial	1,799	3,518	—	5,317
Consumer	5	—	—	5
Total	$346,212	$4,489	$2,197	$352,898

	Payment Status (Amortized Cost Basis) at
	September 30, 2024
30-89 Days · 90 or More Days
	Current	Past Due	Past Due	Total
(In thousands)
Real estate mortgage:
Commercial	$154,206	$14,160	$—	$168,366
Other residential	3,112	91	3,986	7,189
Commercial:
Asset-based	2,195	—	—	2,195
Venture capital	13,156	—	—	13,156
Other commercial	672	3,161	—	3,833
Consumer	11	—	—	11
Total	$173,352	$17,412	$3,986	$194,750

The following tables present information on loans that defaulted during the periods indicated, which had been modified during the preceding 12-month period, with related amortized cost balances as of the dates indicated:

	Three Months Ended
	September 30, 2025
	Modified Loans That Subsequently Defaulted
	Amortized Cost Basis at
	September 30, 2025
Combination - Term
Extension and
	Term Extension	Rate Reduction	Total
(In thousands)
Real estate mortgage:
Other residential	$971	$—	$971
Commercial:
Other commercial	3,525	73	3,598
Total	$4,496	$73	$4,569

	Nine Months Ended
	September 30, 2025
	Modified Loans That Subsequently Defaulted
	Amortized Cost Basis at
	September 30, 2025
(In thousands) · Combination - Term
Extension and
	Term Extension	Payment Delay	Rate Reduction	Total
Real estate mortgage:
Other residential	$971	$2,197	$—	$3,168
Commercial:
Other commercial	3,525	—	73	3,598
Total	$4,496	$2,197	$73	$6,766

Three Months Ended September 30, 2024 · Nine Months Ended September 30, 2024
Modified Loans That Subsequently Defaulted · Modified Loans That Subsequently Defaulted
Amortized Cost Basis at · Amortized Cost Basis at
	September 30, 2024			September 30, 2024
	Term Extension	Payment Delay	Total	Term Extension	Payment Delay	Total
(In thousands)
Real estate mortgage:
Commercial	$—	$14,160	$14,160	$—	$14,160	$14,160
Other residential	556	—	556	4,077	—	4,077
Total	$556	$14,160	$14,716	$4,077	$14,160	$18,237

Leases Receivable

We provide equipment financing to our customers primarily with operating and direct financing leases. For direct financing leases, lease receivables are recorded on the balance sheet, but the leased equipment is not, although we generally retain legal title to the leased equipment until the end of each lease. Direct financing leases are stated at the net amount of minimum lease payments receivable, plus any unguaranteed residual value, less the amount of unearned income and net acquisition discount at the reporting date. Direct lease origination costs are amortized using the effective interest method over the life of the leases. Direct financing leases are subject to our accounting for ALLL. See Note 7. Leases for information regarding operating leases where we are the lessor.

The following table provides the components of leases receivable income for the periods indicated:

Three Months Ended · Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
(In thousands)
Component of leases receivable income:
Interest income on net investments in leases	$3,454	$4,711	$11,199	$14,323

The following table presents the components of leases receivable as of the dates indicated:

	September 30, 2025	December 31, 2024
(In thousands)
Net Investment in Direct Financing Leases:
Lease payments receivable	$141,372	$202,815
Unguaranteed residual assets	20,424	22,489
Deferred costs and other	1,309	1,955
Aggregate net investment in leases	$163,105	$227,259

The following table presents maturities of leases receivable as of the date indicated:

September 30, 2025
(In thousands)
Period ending December 31,
2025	$14,550
2026	54,062
2027	39,116
2028	25,703
2029	18,693
Thereafter	4,240
Total undiscounted cash flows	156,364
Less: Unearned income	(14,992)
Present value of lease payments	$141,372

Allowance for Loan and Lease Losses

The following tables present a summary of the activity in the ALLL on loans and leases held for investment by loan portfolio segment for the periods indicated:

	Three Months Ended September 30, 2025
Real Estate
Real Estate · Construction
	Mortgage	and Land	Commercial	Consumer	Total
(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$134,945	$7,063	$73,330	$14,006	$229,344
Charge-offs	(2,455)	—	(3,052)	(958)	(6,465)
Recoveries	1,602	1,370	5,833	117	8,922
Net (charge-offs) recoveries	(853)	1,370	2,781	(841)	2,457
Provision	3,456	205	4,746	293	8,700
Balance, end of period	$137,548	$8,638	$80,857	$13,458	$240,501
	Nine Months Ended September 30, 2025
Real Estate
Real Estate · Construction
	Mortgage	and Land	Commercial	Consumer	Total
(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$145,754	$10,940	$67,833	$14,833	$239,360
Charge-offs	(24,324)	(21,536)	(21,227)	(2,877)	(69,964)
Recoveries	2,212	1,370	10,224	319	14,125
Net charge-offs	(22,112)	(20,166)	(11,003)	(2,558)	(55,839)
Provision	13,906	17,864	24,027	1,183	56,980
Balance, end of period	$137,548	$8,638	$80,857	$13,458	$240,501
Ending Allowance by
Evaluation Methodology:
Individually evaluated	$—	$—	$—	$—	$—
Collectively evaluated	$137,548	$8,638	$80,857	$13,458	$240,501
Ending Loans and Leases by
Evaluation Methodology:
Individually evaluated	$166,678	$—	$4,981	$331	$171,990
Collectively evaluated	13,413,184	2,154,826	8,001,676	368,966	23,938,652
Ending balance	$13,579,862	$2,154,826	$8,006,657	$369,297	$24,110,642

	Three Months Ended September 30, 2024
Real Estate
Real Estate · Construction
	Mortgage	and Land	Commercial	Consumer	Total
(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$155,260	$25,281	$51,194	$16,027	$247,762
Charge-offs	(640)	—	(1,963)	(1,560)	(4,163)
Recoveries	216	—	1,253	277	1,746
Net charge-offs	(424)	—	(710)	(1,283)	(2,417)
Provision	9,798	(11,943)	10,387	758	9,000
Balance, end of period	$164,634	$13,338	$60,871	$15,502	$254,345
	Nine Months Ended September 30, 2024
Real Estate
Real Estate · Construction
	Mortgage	and Land	Commercial	Consumer	Total
(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$186,827	$33,830	$45,156	$15,874	$281,687
Charge-offs	(56,998)	—	(5,815)	(4,434)	(67,247)
Recoveries	2,536	—	4,956	413	7,905
Net charge-offs	(54,462)	—	(859)	(4,021)	(59,342)
Provision	32,269	(20,492)	16,574	3,649	32,000
Balance, end of period	$164,634	$13,338	$60,871	$15,502	$254,345
Ending Allowance by
Evaluation Methodology:
Individually evaluated	$—	$—	$8,196	$—	$8,196
Collectively evaluated	$164,634	$13,338	$52,675	$15,502	$246,149
Ending Loans and Leases by
Evaluation Methodology:
Individually evaluated	$129,829	$—	$36,527	$—	$166,356
Collectively evaluated	13,204,577	3,459,409	6,282,945	414,490	23,361,421
Ending balance	$13,334,406	$3,459,409	$6,319,472	$414,490	$23,527,777

The allowance for loan and lease losses increased by $11.2 million in the third quarter of 2025 to $240.5 million compared to the second quarter due primarily to a $8.7 million provision and net recoveries of $2.5 million.

For additional information regarding the calculation of the ALLL using the CECL methodology, including discussion of forecasts used to estimate the allowance, please see Note 1(j). Nature of Operations and Summary of Significant Accounting Policies - Allowance for Credit Losses on Loans and Leases Held for Investmentof the Notes to Consolidated Financial Statements contained in "Item 8. Financial Statements and Supplementary Data" of the Form 10-K.

A loan is considered collateral-dependent, and is individually evaluated for reserve purposes, when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. The following table summarizes collateral-dependent loans held for investment by collateral type as of the following dates:

September 30, 2025 · December 31, 2024
Real · Business · Real · Business
	Property	Assets	Total	Property	Assets	Total
(In thousands)
Real estate mortgage	$166,678	$—	$166,678	$167,060	$—	$167,060
Commercial	—	3,465	3,465	—	10,870	10,870
Total	$166,678	$3,465	$170,143	$167,060	$10,870	$177,930

Allowance for Credit Losses

The ACL is the combination of the ALLL and the reserve for unfunded loan commitments. The reserve for unfunded loan commitments is included within "Accrued interest payable and other liabilities" on the condensed consolidated balance sheets.

The following tables present a summary of the activity in the ALLL and reserve for unfunded loan commitments for the periods indicated:

	Three Months Ended
	September 30, 2025
	Allowance for	Reserve for	Total
	Loan and	Unfunded Loan	Allowance for
	Lease Losses	Commitments	Credit Losses
(In thousands)
Balance, beginning of period	$229,344	$29,221	$258,565
Charge-offs	(6,465)	—	(6,465)
Recoveries	8,922	—	8,922
Net recoveries	2,457	—	2,457
Provision	8,700	1,000	9,700
Balance, end of period	$240,501	$30,221	$270,722
	Nine Months Ended
	September 30, 2025
	Allowance for	Reserve for	Total
	Loan and	Unfunded Loan	Allowance for
	Lease Losses	Commitments	Credit Losses
(In thousands)
Balance, beginning of period	$239,360	$29,071	$268,431
Charge-offs	(69,964)	—	(69,964)
Recoveries	14,125	—	14,125
Net charge-offs	(55,839)	—	(55,839)
Provision	56,980	1,150	58,130
Balance, end of period	$240,501	$30,221	$270,722

	Three Months Ended
	September 30, 2024
	Allowance for	Reserve for	Total
	Loan and	Unfunded Loan	Allowance for
	Lease Losses	Commitments	Credit Losses
(In thousands)
Balance, beginning of period	$247,762	$27,571	$275,333
Charge-offs	(4,163)	—	(4,163)
Recoveries	1,746	—	1,746
Net charge-offs	(2,417)	—	(2,417)
Provision	9,000	—	9,000
Balance, end of period	$254,345	$27,571	$281,916
	Nine Months Ended
	September 30, 2024
	Allowance for	Reserve for	Total
	Loan and	Unfunded Loan	Allowance for
	Lease Losses	Commitments	Credit Losses
(In thousands)
Balance, beginning of period	$281,687	$29,571	$311,258
Charge-offs	(67,247)	—	(67,247)
Recoveries	7,905	—	7,905
Net charge-offs	(59,342)	—	(59,342)
Provision	32,000	(2,000)	30,000
Balance, end of period	$254,345	$27,571	$281,916

NOTE 5. GOODWILL AND OTHER INTANGIBLE ASSETS, NET

Goodwill and other intangible assets arise from the acquisition method of accounting for business combinations. Goodwill and other intangible assets generated from business combinations and deemed to have indefinite lives are not subject to amortization and instead are tested for impairment annually at the reporting unit level unless a triggering event occurs thereby requiring an updated assessment. Our regular annual impairment assessment occurs in the fourth quarter.

Goodwill represents the excess of the purchase price over the fair value of the net assets and other identifiable intangible assets acquired. Impairment exists when the carrying value of the goodwill exceeds the fair value of the reporting unit. An impairment loss would be recognized in an amount equal to that excess as a charge to "Noninterest expense" in the condensed consolidated statements of earnings.

The following table presents the carrying amount of goodwill as of the dates indicated:

	Goodwill
(In thousands)
Balance, December 31, 2024	$214,521
Balance, September 30, 2025	$214,521

Our other intangible assets with definite lives are CDI and CRI. CDI and CRI are amortized on an accelerated basis over their respective estimated useful lives and reviewed for impairment at least quarterly. The amortization expense represents the estimated decline in the value of the underlying deposits or customer relationships acquired.

The following table presents the carrying amounts of CDI and CRI and the related accumulated amortization for the periods indicated:

Three Months Ended · Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
(In thousands)
Gross carrying amount of CDI and CRI,
beginning of period	$178,764	$236,264	$178,764	$236,264
Accumulated Amortization:
Balance, beginning of period	(59,834)	(87,370)	(45,820)	(70,787)
Amortization expense	(7,007)	(8,332)	(21,021)	(24,915)
Balance, end of period	(66,841)	(95,702)	(66,841)	(95,702)
Net CDI and CRI, end of period	$111,923	$140,562	$111,923	$140,562

The following table presents the estimated aggregate future amortization expense for our current CDI and CRI as of the date indicated:

September 30, 2025
(In thousands)
Period ending December 31,
2025	$6,636
2026	24,412
2027	21,166
2028	17,920
2029	14,675
Thereafter	27,114
Net CDI and CRI	$111,923

NOTE 6. OTHER ASSETS

The following table presents the detail of our other assets as of the dates indicated:

	September 30,	December 31,
Other Assets	2025	2024
(In thousands)
Investments:
LIHTC investments	$271,814	$295,964
SBIC investments	116,870	109,636
Alternative energy partnerships (HLBV investments)	16,429	17,472
Other equity and CRA investments	149,380	143,152
Total investments	554,493	566,224
Interest receivable	127,466	125,469
Operating lease ROU assets, net (1)	101,520	100,092
Prepaid expenses	35,307	39,432
Taxes receivable	8,491	18,009
Foreclosed assets, net	4,790	9,734
Equity warrants	3,418	3,763
Other receivables/assets	47,600	51,231
Total other assets	$883,085	$913,954

(1)See Note 7. Leases for further details regarding the operating lease ROU assets.

NOTE 7. LEASES

Operating Leases as a Lessee

Our lease expense is a component of "Occupancy expense" on our condensed consolidated statements of earnings. The following table presents the components of lease expense for the periods indicated:

Three Months Ended · Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
(In thousands)
Operating lease expense:
Fixed costs	$7,205	$7,689	$21,501	$26,051
Variable costs	36	299	271	447
Short-term lease costs	233	267	679	407
Sublease income	(1,065)	(1,129)	(3,353)	(3,646)
Net lease expense	$6,409	$7,126	$19,098	$23,259

The following table presents supplemental cash flow information related to leases for the periods indicated:

	Nine Months Ended
	September 30,
	2025	2024
(In thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$24,064	$28,689
ROU assets obtained in exchange for lease obligations:
Operating leases	$22,540	$3,437

The following table presents supplemental balance sheet and other information related to operating leases as of the dates indicated:

	September 30,	December 31,
	2025	2024
(Dollars in thousands)
Operating leases:
Operating lease right-of-use assets, net	$101,520	$100,092
Operating lease liabilities	$123,254	$124,355
Weighted average remaining lease term (in years)	5.8	5.9
Weighted average discount rate	3.75%	3.53%

The following table presents the maturities of operating lease liabilities as of the date indicated:

September 30, 2025
(In thousands)
Period ending December 31,
2025	$7,763
2026	30,882
2027	24,621
2028	20,453
2029	16,540
Thereafter	37,729
Total operating lease liabilities	137,988
Less: Imputed interest	(14,734)
Present value of operating lease liabilities	$123,254

Operating Leases as a Lessor

We provide equipment financing to our customers through operating leases where we facilitate the purchase of equipment leased to our customers. The equipment is shown on the condensed consolidated balance sheets as "Equipment leased to others under operating leases" and is depreciated to its estimated residual value at the end of the lease term, shown as "Leased equipment depreciation" in the condensed consolidated statements of earnings, according to our fixed asset accounting policy. We receive periodic rental income payments under the leases, which are recorded as "Leased equipment income" in the condensed consolidated statements of earnings. The equipment is tested periodically for impairment. No impairment was recorded on "Equipment leased to others under operating leases" during the nine months ended September 30, 2025 and 2024.

The following table presents the rental payments to be received on operating leases as of the date indicated:

September 30, 2025
(In thousands)
Period ending December 31,
2025	$8,710
2026	35,630
2027	29,290
2028	26,424
2029	24,917
Thereafter	45,985
Total undiscounted cash flows	$170,956

NOTE 8. BORROWINGS AND SUBORDINATED DEBT

Borrowings

The following table summarizes our borrowings as of the dates indicated:

September 30, 2025 · December 31, 2024
Weighted · Weighted
	Average		Average
	Balance	Rate	Balance	Rate
(Dollars in thousands)
FHLB secured advances	$1,700,000	3.96%	$1,100,000	3.93%
Other short-term borrowings	190,000	4.18%	—	—%
Credit-linked notes	115,022	15.09%	118,838	15.29%
Senior Notes	—	—%	174,000	5.25%
Total borrowings	2,005,022	4.62%	1,392,838	5.06%
Acquisition discount on Senior Notes	—		(1,024)
Total borrowings, net (1)	$2,005,022		$1,391,814

(1) All borrowings were held at the Bank level with the exception of the Senior Notes. The Senior Notes were repaid in full in April 2025.

The Bank has established secured and unsecured lines of credit under which it may borrow funds from time to time on a term or overnight basis from the FHLB, the FRBSF, and other financial institutions.

FHLB Secured Line of Credit. The Bank had secured financing capacity with the FHLB as of September 30, 2025 of $7.1 billion, collateralized by a blanket lien on $10.6 billion of qualifying loans and $20.1 million of securities. As of September 30, 2025, there were $577.4 million in letters of credit pledged and $1.7 billion outstanding. As of December 31, 2024, there were $527.9 million in letters of credit pledged and a $1.1 billion balance outstanding.

The following table presents the interest rates and maturity dates of FHLB secured advances as of the date indicated:

	September 30, 2025
Maturity
FHLB Secured Advances	Balance	Rate	Date
(Dollars in thousands)
Term advance	$200,000	4.42%	10/06/2025
Term advance (1)	150,000	4.59%	06/26/2026
Term advance	100,000	3.79%	02/01/2027
Term advance	100,000	3.79%	03/01/2027
Term advance	100,000	3.78%	04/01/2027
Term advance (1)	150,000	4.63%	05/28/2027
Term advance (1)	150,000	4.63%	06/03/2027
Term advance (1)	150,000	4.39%	06/03/2027
Term advance	100,000	3.88%	06/24/2027
Term advance (1)	500,000	3.18%	09/18/2034
Total FHLB secured advances	$1,700,000	3.96%

(1) Represents FHLB term advances that include a put feature.which allows the FHLB to terminate the advance before its scheduled maturity date.

FRBSF Secured Line of Credit. The Bank has a secured line of credit with the FRBSF. As of September 30, 2025, the Bank had secured borrowing capacity of $5.5 billion collateralized by liens covering $5.0 billion of qualifying loans and $1.6 billion of securities. As of September 30, 2025 and December 31, 2024, there wasno balance outstanding.

Holding Company Line of Credit Arrangement. On December 23, 2024, Banc of California, Inc. entered into an unsecured revolving line of credit agreement as a borrower for $50.0 million. On March 17, 2025, the Company executed an amendment to the credit agreement which increased the Company's unsecured revolving line of credit to $100.0 million. The rate is based on 1-month SOFR plus a spread of 225 basis points. As of September 30, 2025 and December 31, 2024, there wasno balance outstanding.

Senior Notes. The Senior Notes were unsecured debt obligations and ranked equally with our other unsecured unsubordinated obligations. We made interest payments on the Senior Notes semi-annually in arrears. On April 4, 2025, the Company repaid the Senior Notes in full that were scheduled to mature on April 15, 2025.

Credit-Linked Notes. On September 29, 2022, legacy Pacific Western Bank completed a credit-linked notes transaction. The notes were issued infive classes, each with an interest rate of SOFR plus a spread that ranges from 8.00% to 13.25%, with a weighted average spread of 10.75% at September 30, 2025. The notes are linked to the credit risk of an approximately $2.2 billion reference pool of previously purchased single-family residential mortgage loans at September 30, 2025. The notes are due June 27, 2052. Principal payments on the notes are based only on principal that is actually collected on these loans. The notes are reported at fair value of $115.0 million at September 30, 2025. See Note 2. Restricted Cash for information regarding the collateral for the notes and Note 11. Fair Value Option for additional information.

Other Short-Term Borrowing Arrangements. The Bank had credit limits of $215.0 million in the aggregate with several commercial banks, as well as borrowing arrangements with unaffiliated financial institutions that provide for the purchase of overnight funds and other short-term borrowings. The availability of these unsecured borrowings fluctuates regularly and is subject to the discretion of the counterparties. As of September 30, 2025, $190.0 million was outstanding under these arrangements, compared to no borrowings outstanding as of December 31, 2024.

Subordinated Debt

The following table summarizes the terms of each issuance of subordinated debt outstanding as of the dates indicated:

September 30, 2025 · December 31, 2024 · Date · Maturity · Rate Index
Series	Balance	Rate (1)	Balance	Rate (1)	Issued	Date	(Quarterly Reset)
(Dollars in thousands)
Subordinated notes, net (2)(3)(4)	$381,597	3.25%	$381,185	3.25%	04/30/2021	05/01/2031	Fixed rate
Subordinated notes (5)	75,000	4.375%	75,000	4.375%	10/30/2020	10/30/2030	Fixed rate
Trust V	10,310	7.38%	10,310	7.71%	08/15/2003	09/17/2033	3-month Term SOFR + 3.10
Trust VI	10,310	7.35%	10,310	7.67%	09/03/2003	09/15/2033	3-month Term SOFR + 3.05
Trust CII	5,155	7.23%	5,155	7.56%	09/17/2003	09/17/2033	3-month Term SOFR + 2.95
Trust VII	61,856	7.32%	61,856	7.60%	02/05/2004	04/23/2034	3-month Term SOFR + 2.75
Trust CIII	20,619	5.99%	20,619	6.31%	08/15/2005	09/15/2035	3-month Term SOFR + 1.69
Trust FCCI	16,495	5.90%	16,495	6.22%	01/25/2007	03/15/2037	3-month Term SOFR + 1.60
Trust FCBI	10,310	5.85%	10,310	6.17%	09/30/2005	12/15/2035	3-month Term SOFR + 1.55
Trust CS 2005-1	82,475	6.25%	82,475	6.57%	11/21/2005	12/15/2035	3-month Term SOFR + 1.95
Trust CS 2005-2	128,866	6.52%	128,866	6.80%	12/14/2005	01/30/2036	3-month Term SOFR + 1.95
Trust CS 2006-1	51,545	9.45%	51,545	9.95%	02/22/2006	04/30/2036	Prime + 1.95
Trust CS 2006-2	51,550	6.52%	51,550	6.80%	09/27/2006	10/30/2036	3-month Term SOFR + 1.95
Trust CS 2006-3 (6)	30,244	4.07%	26,687	5.10%	09/29/2006	10/30/2036	3-month EURIBOR + 2.05
Trust CS 2006-4	16,470	9.45%	16,470	9.95%	12/05/2006	01/30/2037	Prime + 1.95
Trust CS 2006-5	6,650	6.52%	6,650	6.80%	12/19/2006	01/30/2037	3-month Term SOFR + 1.95
Trust CS 2007-2	39,177	6.52%	39,177	6.80%	06/13/2007	07/30/2037	3-month Term SOFR + 1.95
PMB Statutory Trust III	7,217	7.66%	7,217	7.99%	09/16/2002	09/26/2032	3-month Term SOFR + 3.40
PMB Capital Trust III	10,310	6.59%	10,310	6.89%	10/04/2004	10/08/2034	3-month Term SOFR + 2.00
Total subordinated debt	1,016,156	5.28%	1,012,187	5.48%
Acquisition discount (7)	(65,268)		(70,264)
Total subordinated debt, net	$950,888		$941,923

(1)Rates do not include the effects of discounts and issuance costs.

(2)Net of unamortized issuance costs of $3.4 million at September 30, 2025 and $3.8 million at December 31, 2024.

(3)Interest rate is fixed until May 1, 2026, when it changes to a floating rate and resets quarterly equal to 3-month Term SOFR, plus a spread of 252 basis points.

(4)Subordinated notes, net, issued at the Bank level rather than the holding company level.

(5)Interest rate was fixed until October 30, 2025, when it changed to a floating rate equal to 3-month Term SOFR, plus a spread of 419.5 basis points.

(6)Denomination is in Euros with a value of €25.8 million.

(7)Amount represents the fair value adjustment on subordinated debt assumed in acquisitions.

NOTE 9. DERIVATIVES

We use derivative instruments and other risk management techniques to reduce our exposure to adverse fluctuations in interest rates and foreign currency exchange rates in accordance with our risk management policies and for certain loan clients to allow them to hedge the risk of rising interest rates and on their variable rate loans.

Our derivatives are carried at fair value and recorded in "Other assets" or "Accrued interest payable and other liabilities," as appropriate, in the condensed consolidated balance sheets. On the date we enter into a derivative contract, the derivative is designated as a fair value hedge, cash flow hedge, or a hedge designation is not made as it is a customer-related transaction. When a derivative is designated as a fair value hedge or cash flow hedge, the Company performs an assessment at inception, and at least quarterly thereafter, to determine the effectiveness of the derivative in offsetting changes in the fair value or cash flows of the hedged items.

The following table presents the U.S. dollar notional amounts and fair values of our derivative instruments included in the condensed consolidated balance sheets as of the dates indicated:

September 30, 2025 · December 31, 2024
Notional · Fair Value · Notional · Fair Value
	Amount	Asset	Liability	Amount	Asset	Liability
(In thousands)
Derivatives Designated as Cash Flow Hedges:
Interest rate swaps	$300,000	$—	$4,281	$300,000	$1,442	$—
Interest rate collars	1,000,000	—	113	—	—	—
Derivatives Not Designated as Hedging Instruments:
Interest rate contracts	152,480	4,268	4,224	192,405	6,516	6,428
Foreign exchange contracts	97,312	128	119	36,155	515	1,134
Equity warrant assets	14,494	3,418	—	16,066	3,763	—
Total contracts	$1,564,286	$7,814	$8,737	$544,626	$12,236	$7,562

Cash Flow Hedges

Cash flow hedges included pay-fixed, receive-floating interest rate swap contracts with notional amounts aggregating $300.0 million, five-year terms, and varying maturity dates throughout 2028. These swap contracts were entered into with institutional counterparties to hedge against variability in cash flow attributable to interest rate risk on a portion of the Company's borrowings. Cash flow hedges also included interest rate collars, which are option contracts designed to limit the Company's exposure to increases in short term interest rates while foregoing some of the upside if short term interest rates decrease significantly. The interest rate collars have notional amounts aggregating to $1.0 billion, with eighteen month terms, and maturing on October 31, 2026. These collars were entered into with institutional counterparties to hedge against variability in cash flows attributable to interest rate risk on a portion of the Company's floating rate deposits.

The cash flow hedges were deemed highly effective at inception and as of September 30, 2025. For derivatives designated as cash flow hedges, the portion of changes in fair value considered to be highly effective is reported as a component of AOCI on the condensed consolidated balance sheets until the related cash flows from the hedged items are recognized in earnings. As of September 30, 2025, the fair value of the cash flow hedges represented a net liability of $4.4 million, related to which a loss of $3.9 million (net of tax) was included in AOCI. The estimated amount to be reclassified in the next 12 months out of AOCI into earnings is $1.1 million.

Terminated Cash Flow Hedge

The Company terminated all of the pay-fixed, receive floating interest rate swap contracts classified as cash flow hedges with notional amounts of $355.0 million entered into during 2024, and all remaining deferred amounts in AOCI have been amortized into interest expense as of the end of the third quarter of 2025.

Other Interest Rate Swaps, Foreign Exchange Contracts, and Equity Warrant Assets Not Designated for Hedge Accounting

The Company offers borrowers interest rate swaps under a "back-to-back" loan hedging program and offsets these "pay floating/receive fixed" contracts with borrowers with "receive floating/pay fixed" swaps with counterparty banks. The total notional balance of these offsetting hedging contracts was $152.5 million at September 30, 2025.

The Company has also hedged the interest rate risk and foreign currency risk on €25.8 million of subordinated debt utilizing a cross-currency swap. Under the current terms of the swap, the Company receives three-month Euribor plus 205 basis points and pays a fixed rate of 5.92% with ultimate principal exchanged at maturity. For the quarter ended September 30, 2025, changes in fair value and fees recorded to "Noninterest income" in the condensed consolidated statements of earnings were immaterial.

See Note 12. Fair Value Measurements for additional information regarding equity warrant assets.

NOTE 10. COMMITMENTS AND CONTINGENCIES

The following table presents a summary of commitments described below as of the dates indicated:

	September 30,	December 31,
	2025	2024
(In thousands)
Loan commitments to extend credit	$4,822,917	$4,887,690
Standby letters of credit	225,096	201,768
Total	$5,048,013	$5,089,458

The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the condensed consolidated balance sheets. The contract or notional amounts of those instruments reflect the extent of involvement that the Company has in particular classes of financial instruments.

Commitments to extend credit are contractual agreements to lend to our customers when customers are in compliance with their contractual credit agreements and when customers have contractual availability to borrow under such agreements. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The estimated exposure to loss from these commitments is included in the reserve for unfunded loan commitments, which amounted to $30.2 million at September 30, 2025 and $29.1 million at December 31, 2024.

Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. We provide standby letters of credit in conjunction with several of our lending arrangements and property lease obligations. Most guarantees expire within one year from the date of issuance. If a borrower defaults on its commitments subject to any letter of credit issued under these arrangements, we would be required to meet the borrower's financial obligation but would seek repayment of that financial obligation from the borrower. In some cases, borrowers have pledged cash and investment securities as collateral under these arrangements.

In addition, we invest in SBICs that call for capital contributions up to an amount specified in the partnership agreements, and in CRA-related loan pools. As of September 30, 2025 and December 31, 2024, we had commitments to contribute capital to these entities totaling $107.4 million and $79.7 million.

The following table presents the years in which commitments are expected to be paid for our commitments to contribute capital to SBICs and CRA-related loan pools as of the date indicated:

September 30, 2025
(In thousands)
Period ending December 31,
2025	$53,683
2026	53,682
Total	$107,365

Legal Matters

In the ordinary course of our business, the Company is party to various legal actions, which we believe are incidental to the operation of our business. The outcome of such legal actions and the timing of ultimate resolution are inherently difficult to predict. In the opinion of management, based upon currently available information, any resulting liability, in addition to amounts already accrued, and taking into consideration insurance which may be applicable, would not have a material adverse effect on the Company’s financial statements or operations. The range of any reasonably possible liabilities is also not significant.

NOTE 11. FAIR VALUE OPTION

The Company may elect to report financial instruments and certain other items at fair value on an instrument-by-instrument basis with changes in fair value reported in earnings. The election is made upon the initial recognition of an eligible financial asset, financial liability, or firm commitment or when certain specified reconsideration events occur. The fair value election may not otherwise be revoked once an election is made. The changes in fair value are recorded in "Noninterest income" on the condensed consolidated statements of earnings. However, movements in debt valuation adjustments are reported as a component of "Accumulated other comprehensive loss, net" on the condensed consolidated balance sheets. Debt valuation adjustments represent the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk.

Fair Value Option for Certain Debt Liabilities

The Company has elected the fair value option for the credit-linked notes issued in September 2022. The Company elected the fair value option because these exposures are considered to be structured notes, which are financial instruments that contain embedded derivatives. The notes are linked to the credit risk of an approximately $2.2 billion reference pool of previously purchased single-family residential mortgage loans. The principal balance of the credit-linked notes was $116.2 million at September 30, 2025. The carrying value of the credit-linked notes at September 30, 2025 was the estimated fair value of $115.0 million. For the three and nine months ended September 30, 2025, the interest expense on the credit-linked notes totaled $4.5 million and $13.5 million and totaled $5.0 million and $15.0 million for the three and nine months ended September 30, 2024, and was recorded in "Interest expense - borrowings" on the condensed consolidated statements of earnings.

The following table presents the changes in fair value of the credit-linked notes for which the fair value option has been elected for the periods indicated:

Three Months Ended · Nine Months Ended
	September 30,		September 30,
Credit-Linked Notes	2025	2024	2025	2024
(In thousands)
Changes in fair value - gains (losses) included in earnings	$14	$4,399	$(141)	$1,624
Changes in fair value - other comprehensive income (loss)	$1,361	$(1,495)	$990	$(2,110)

The following table provides information about the credit-linked notes carried at fair value as of the dates indicated:

	September 30,	December 31,
Credit-Linked Notes	2025	2024
(In thousands)
Carrying value reported on the condensed consolidated balance sheets	$115,022	$118,838
Aggregate unpaid principal balance in excess of fair value	$1,150	$301

NOTE 12. FAIR VALUE MEASUREMENTS

The Company uses fair value to measure certain assets and liabilities on a recurring basis, primarily AFS securities, derivatives, and certain debt liabilities. For assets measured at the lower of cost or fair value, the fair value measurement criteria may or may not be met during a reporting period and such measurements are therefore considered “nonrecurring” for purposes of disclosing our fair value measurements. Fair value is used on a nonrecurring basis to adjust carrying values for individually evaluated loans and leases and other real estate owned and also to record impairment on certain assets, such as goodwill, CDI, and other long-lived assets.

For information regarding the valuation methodologies used to measure our assets recorded at fair value (under ASC Topic 820), and for estimating fair value for financial instruments not recorded at fair value (under ASC Topic 825, as amended by ASU 2016-01 and ASU 2018-03), see Note 1. Nature of Operations and Summary of Significant Accounting Policiesand Note 15. Fair Value Measurements to the Consolidated Financial Statements of the Company's Form 10-K.

The Company also holds SBIC investments measured at fair value using the NAV per share practical expedient that are not required to be classified in the fair value hierarchy. At September 30, 2025, the fair value of these investments was $116.9 million.

The following tables present information on the assets and liabilities measured and recorded at fair value on a recurring basis as of the dates indicated:

	Fair Value Measurements as of
	September 30, 2025
Measured on a Recurring Basis	Total	Level 1	Level 2	Level 3
(In thousands)
Securities available-for-sale:
Agency residential MBS	$844,155	$—	$844,155	$—
Agency commercial MBS	50,882	—	50,882	—
Agency residential CMOs	781,982	—	781,982	—
Corporate debt securities	256,948	—	254,623	2,325
Private label residential CMOs	258,693	—	258,693	—
Collateralized loan obligations	206,474	—	206,474	—
Private label commercial MBS	10,274	—	10,274	—
Asset-backed securities	13,882	—	13,882	—
SBA securities	3,444	—	3,444	—
Total securities available-for-sale	$2,426,734	$—	$2,424,409	$2,325
Equity investments with readily determinable fair values	$3	$3	$—	$—
Derivatives (1):
Derivative assets
Interest rate and foreign exchange contracts	4,396	—	4,396	—
Equity warrants	3,418	—	—	3,418
Derivative liabilities
Cash flow hedges	4,394	—	4,394	—
Interest rate and foreign exchange contracts	4,343	—	4,343	—
Credit-linked notes	115,022	—	—	115,022

(1)For information regarding derivative instruments, see Note 9. Derivatives.

	Fair Value Measurements as of
	December 31, 2024
Measured on a Recurring Basis	Total	Level 1	Level 2	Level 3
(In thousands)
Securities available-for-sale:
Agency residential MBS	$861,840	$—	$861,840	$—
Agency commercial MBS	51,564	—	51,564	—
Agency residential CMOs	446,631	—	446,631	—
Municipal securities	594	—	594	—
Corporate debt securities	257,712	—	255,582	2,130
Private label residential CMOs	316,910	—	316,910	—
Collateralized loan obligations	279,416	—	279,416	—
Private label commercial MBS	12,372	—	12,372	—
Asset-backed securities	15,600	—	15,600	—
SBA securities	4,200	—	4,200	—
Total securities available-for-sale	$2,246,839	$—	$2,244,709	$2,130
Equity investments with readily determinable fair values	$3	$3	$—	$—
Derivatives (1):
Derivative assets
Cash flow hedges	1,442	—	1,442	—
Interest rate and foreign exchange contracts	7,031	—	7,031	—
Equity warrants	3,763	—	—	3,763
Derivative liabilities
Interest rate and foreign exchange contracts	7,562	—	7,562	—
Credit-linked notes	118,838	—	—	118,838

(1) For information regarding derivative instruments, see Note 9. Derivatives.

During the nine months ended September 30, 2025, there was a $2,000 transfer from Level 3 equity warrants to Level 1 equity investments with readily determinable fair values measured on a recurring basis. There wasno transfer of AFS corporate debt securities from Level 3 to Level 2 during the nine months ended September 30, 2025 andno transfer of AFS corporate debt securities from Level 2 to Level 3 during the same period.

The following table presents information about quantitative inputs and assumptions used to determine the fair values provided by our third-party pricing service for our Level 3 corporate debt securities available-for-sale measured at fair value on a recurring basis as of the date indicated:

	September 30, 2025
	Corporate Debt Securities
	Input or	Weighted
	Range	Average
Unobservable Inputs	of Inputs	Input (1)
Spread to 10 Year Treasury	3.1% - 8.5%	5.5%
Discount rates	7.2% - 12.7%	9.7%

(1) Unobservable inputs for corporate debt securities were weighted by the relative fair values of the instruments.

The following table presents information about quantitative inputs and assumptions used in the modified Black-Scholes option pricing model to determine the fair value for our Level 3 equity warrants measured at fair value on a recurring basis as of the date indicated:

	September 30, 2025
	Equity Warrants
Weighted
	Range	Average
Unobservable Inputs	of Inputs	Input (2)
Volatility (1)	17.4% - 1,905.1%	25.0%
Risk-free interest rate	3.6% - 4.2%	3.7%
Remaining life assumption (in years)	0.08 - 4.97	3.22

(1) The high-end volatility input relates to an out-of-the-money warrant with an immaterial fair value and near-term expiration.

(2) Unobservable inputs for equity warrants were weighted by the relative fair values of the instruments.

The following table summarizes activity for our Level 3 corporate debt securities available-for-sale, equity warrants, and credit-linked notes measured at fair value on a recurring basis for the period indicated:

	Corporate	Equity	Credit-Linked
	Debt Securities	Warrants	Notes
(In thousands)
Balance, December 31, 2024	$2,130	$3,763	$118,838
Total included in earnings	—	1,365	141
Total included in other comprehensive income	195	—	(990)
Issuances	—	247	—
Principal payments	—	—	(2,967)
Exercises and settlements	—	(1,955)	—
Transfers to Level 1 (equity investments with readily
determinable fair values)	—	(2)	—
Balance, September 30, 2025	$2,325	$3,418	$115,022
Unrealized net loss for the period included in other
comprehensive income for securities held at quarter-end	$(675)

The following tables present assets measured at fair value on a non-recurring basis as of the dates indicated:

	Fair Value Measurement as of
	September 30, 2025
Measured on a Non-Recurring Basis	Total	Level 1	Level 2	Level 3
(In thousands)
Individually evaluated loans and leases	$19,113	$—	$16,248	$2,865
OREO	467	—	467	—
Total non-recurring	$19,580	$—	$16,715	$2,865

	Fair Value Measurement as of
	December 31, 2024
Measured on a Non-Recurring Basis	Total	Level 1	Level 2	Level 3
(In thousands)
Individually evaluated loans and leases	$58,948	$—	$45,962	$12,986
OREO	3,372	—	3,372	—
Total non-recurring	$62,320	$—	$49,334	$12,986

In addition to individually evaluated loans and leases and OREO, loans held for sale are carried at the lower of cost or market and may be measured at fair value on a nonrecurring basis when fair value is less than cost. Fair value is based on active bids and other observable market inputs, such as appraised value of the underlying collaterals, adjusted for specific attributes of that loan or other available market data for similar loans. Loans held for sale are classified as Level 2 in the fair value hierarchy.

The following table presents losses recognized on assets measured on a nonrecurring basis for the periods indicated:

Three Months Ended · Nine Months Ended
Losses on Assets	September 30,		September 30,
Measured on a Non-Recurring Basis	2025	2024	2025	2024
(In thousands)
Individually evaluated loans and leases	$827	$8,945	$1,743	$29,192
OREO	123	207	274	336
Total losses	$950	$9,152	$2,017	$29,528

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a nonrecurring basis as of the date indicated:

Valuation · Unobservable · Input or · Weighted
Asset · Fair Value · Technique · Inputs · Range · Average
(In thousands)
Individually evaluated
loans and leases	$2,865	Third-party appraisals	No discounts
Total non-recurring Level 3	$2,865

The following tables present carrying amounts and estimated fair values of certain financial instruments as of the dates indicated:

	September 30, 2025
Carrying · Estimated Fair Value
	Amount	Total	Level 1	Level 2	Level 3
(In thousands)
Financial Assets:
Cash and due from banks	$205,364	$205,364	$205,364	$—	$—
Interest-earning deposits in financial institutions	2,192,901	2,192,901	2,192,901	—	—
Securities available-for-sale	2,426,734	2,426,734	—	2,424,409	2,325
Securities held-to-maturity	2,303,657	2,223,622	183,536	2,036,210	3,876
Investment in FRB and FHLB stock	159,337	159,337	—	159,337	—
Loans held for sale	211,454	211,613	—	211,613	—
Loans and leases held for investment, net	23,870,141	22,968,320	—	16,248	22,952,072
Equity investments with readily determinable fair values	3	3	3	—	—
Equity warrants	3,418	3,418	—	—	3,418
Interest rate and foreign exchange contracts	4,396	4,396	—	4,396	—
Servicing rights	17,998	19,818	—	—	19,818
Financial Liabilities:
Demand, checking, money market, and savings deposits	22,458,245	22,458,245	—	22,458,245	—
Time deposits	4,726,520	4,721,428	—	4,721,428	—
Borrowings	2,005,022	2,008,135	190,000	1,703,113	115,022
Subordinated debt	950,888	934,793	—	934,793	—
Cash flow hedges	4,394	4,394	—	4,394	—
Interest rate and foreign exchange contracts	4,343	4,343	—	4,343	—

	December 31, 2024
Carrying · Estimated Fair Value
	Amount	Total	Level 1	Level 2	Level 3
(In thousands)
Financial Assets:
Cash and due from banks	$192,006	$192,006	$192,006	$—	$—
Interest-earning deposits in financial institutions	2,310,206	2,310,206	2,310,206	—	—
Securities available-for-sale	2,246,839	2,246,839	—	2,244,709	2,130
Securities held-to-maturity	2,306,149	2,156,694	173,283	1,976,265	7,146
Investment in FRB and FHLB stock	147,773	147,773	—	147,773	—
Loans held for sale	26,331	26,562	—	26,562	—
Loans and leases held for investment, net	23,542,303	22,412,073	—	45,962	22,366,111
Equity investments with readily determinable fair values	3	3	3	—	—
Equity warrants	3,763	3,763	—	—	3,763
Cash flow hedges	1,442	1,442	—	1,442	—
Interest rate and foreign exchange contracts	7,031	7,031	—	7,031	—
Servicing rights	19,623	21,040	—	—	21,040
Financial Liabilities:
Demand, checking, money market, and savings deposits	22,625,485	22,625,485	—	22,625,485	—
Time deposits	4,566,424	4,556,575	—	4,556,575	—
Borrowings	1,391,814	1,382,742	—	1,263,904	118,838
Subordinated debt	941,923	901,532	—	901,532	—
Interest rate and foreign exchange contracts	7,562	7,562	—	7,562	—

Limitations

Fair value estimates are made at a specific point in time and are based on relevant market information and information about the financial instrument. These estimates do not reflect income taxes or any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Because no market exists for a portion of the Company’s financial instruments, fair value estimates are based on what management believes to be reasonable judgments regarding expected future cash flows, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimated fair values are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Since the fair values have been estimated as of September 30, 2025, the amounts that will actually be realized or paid at settlement or maturity of the instruments could be significantly different.

NOTE 13. EARNINGS PER SHARE

The following tables present the computations of basic and diluted net earnings per share by class of common stock for the periods indicated:

	Three Months Ended September 30, 2025
Non-Voting
Class B · Common
	Voting	Non-Voting	Stock	Total
	Common	Common	Equivalents	Common
(In thousands, except per share amounts)
Basic Earnings Per Share:
Net earnings available to common and equivalent stockholders	$56,374	$181	$3,127	$59,682
Less: Earnings allocated to unvested restricted stock (1)	(31)	—	—	(31)
Net earnings allocated to common and equivalent shares	$56,343	$181	$3,127	$59,651
Weighted average basic shares and unvested restricted
stock outstanding	148,477	477	8,231	157,185
Less: weighted average unvested restricted stock
outstanding	(82)	—	—	(82)
Weighted average basic shares outstanding	148,395	477	8,231	157,103
Basic earnings per share	$0.38	$0.38	$0.38	$0.38
Diluted Earnings Per Share:
Net earnings available to common and equivalent stockholders	$56,374	$181	$3,127	$59,682
Reallocation of net earnings as a result of conversion of
NVCE to Voting Common	3,127	—	—	—
Reallocation of net earnings	2	(2)	395	—
Net earnings for diluted earnings per share	$59,503	$179	$3,522	$59,682
Weighted average diluted shares outstanding	149,188	477	9,386	159,051
Conversion of NVCE to Voting Common	9,386	—	—	—
Shares used in computation of diluted earnings per share	158,574	477	9,386	159,051
Diluted earnings per share	$0.38	$0.38	$0.38	$0.38

	Nine Months Ended September 30, 2025
Non-Voting
Class B · Common
	Voting	Non-Voting	Stock	Total
	Common	Common	Equivalents	Common
(In thousands, except per share amounts)
Basic Earnings Per Share:
Net earnings available to common and equivalent stockholders	$114,387	$360	$6,994	$121,741
Less: Earnings allocated to unvested restricted stock (1)	(89)	—	—	(89)
Net earnings allocated to common and equivalent shares	$114,298	$360	$6,994	$121,652
Weighted average basic shares and unvested restricted
stock outstanding	151,677	477	9,266	161,420
Less: weighted average unvested restricted stock
outstanding	(144)	—	—	(144)
Weighted average basic shares outstanding	151,533	477	9,266	161,276
Basic earnings per share	$0.75	$0.75	$0.75	$0.75
Diluted Earnings Per Share:
Net earnings available to common and equivalent stockholders	$114,387	$360	$6,994	$121,741
Reallocation of net earnings as a result of conversion of
NVCE to Voting Common	6,994	—	—	—
Reallocation of net earnings	2	(2)	188	—
Net earnings for diluted earnings per share	$121,383	$358	$7,182	$121,741
Weighted average diluted shares outstanding	151,959	477	9,557	161,993
Conversion of NVCE to Voting Common	9,557	—	—	—
Shares used in computation of diluted earnings per share	161,516	477	9,557	161,993
Diluted earnings per share	$0.75	$0.75	$0.75	$0.75

(1)Represents cash dividends paid to holders of unvested restricted stock, net of forfeitures, plus undistributed earnings amounts available to holders of unvested restricted stock, if any.

	Three Months Ended September 30, 2024
Non-Voting
Class B · Common
	Voting	Non-Voting	Stock	Total
	Common	Common	Equivalents	Common
(In thousands, except per share amounts)
Basic Loss Per Share:
Net loss available to common and equivalent stockholders	$(1,092)	$(3)	$(68)	$(1,163)
Less: Earnings allocated to unvested restricted stock (1)	59	—	—	59
Net loss allocated to common and equivalent shares	$(1,033)	$(3)	$(68)	$(1,104)
Weighted average basic shares and unvested restricted
stock outstanding	158,503	477	9,903	168,883
Less: weighted average unvested restricted stock
outstanding	(300)	—	—	(300)
Weighted average basic shares outstanding	158,203	477	9,903	168,583
Basic loss per share	$(0.01)	$(0.01)	$(0.01)	$(0.01)
Diluted Loss Per Share:
Net loss allocated to common and equivalent shares	$(1,033)	$(3)	$(68)	$(1,104)
Weighted average diluted shares outstanding	158,203	477	9,903	168,583
Diluted loss per share	$(0.01)	$(0.01)	$(0.01)	$(0.01)

	Nine Months Ended September 30, 2024
Non-Voting
Class B · Common
	Voting	Non-Voting	Stock	Total
	Common	Common	Equivalents	Common
(In thousands, except per share amounts)
Basic Earnings Per Share:
Net earnings available to common and equivalent stockholders	$37,575	$114	$2,439	$40,128
Less: Earnings allocated to unvested restricted stock (1)	27	—	—	27
Net earnings allocated to common and equivalent shares	$37,602	$114	$2,439	$40,155
Weighted average basic shares and unvested restricted
stock outstanding	158,242	477	10,234	168,953
Less: weighted average unvested restricted stock
outstanding	(567)	—	—	(567)
Weighted average basic shares outstanding	157,675	477	10,234	168,386
Basic earnings per share	$0.24	$0.24	$0.24	$0.24
Diluted Earnings Per Share:
Net earnings allocated to common and equivalent shares	$37,602	$114	$2,439	$40,155
Weighted average diluted shares outstanding	157,675	477	10,234	168,386
Diluted earnings per share	$0.24	$0.24	$0.24	$0.24

The terms of each class of the Company’s capital stock are described in Note 15. Stockholders’ Equityto the accompanying condensed consolidated financial statements.

The following table presents the weighted average outstanding restricted shares and warrants that were not included in the computation of diluted earnings per share because their effect would be anti-dilutive for the periods indicated:

Three Months Ended · Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
(In thousands)
Restricted stock awards and units	81	300	144	567
Warrants	—	18,902	—	18,902

NOTE 14. REVENUE FROM CONTRACTS WITH CUSTOMERS

Disaggregation of Revenue

The following table presents interest income and noninterest income, the components of total revenue, as disclosed in the condensed consolidated statements of earnings and the related amounts which are from contracts with customers within the scope of ASC Topic 606, "Revenue from Contracts with Customers," for the periods indicated. As illustrated here, substantially all of our revenue is specifically excluded from the scope of ASC Topic 606.

	Three Months Ended September 30,
	2025		2024
	Total	Revenue from	Total	Revenue from
	Recorded	Contracts with	Recorded	Contracts with
	Revenue	Customers	Revenue	Customers
(In thousands)
Total Interest Income	$432,541	$—	$446,893	$—
Noninterest Income:
Service charges on deposit accounts	5,109	5,109	4,568	4,568
Commissions and fees	9,514	4,605	8,256	4,322
Leased equipment income	10,321	—	17,176	—
Loss on sale of loans	(374)	—	(62)	—
Loss on sale of securities	—	—	(59,946)	—
Dividends and gains on equity investments	2,291	—	3,730	—
Warrant income	433	—	211	—
LOCOM HFS adjustment	—	—	(74)	—
Other income	6,991	54	10,689	170
Total noninterest income (loss)	34,285	9,768	(15,452)	9,060
Total Revenue	$466,826	$9,768	$431,441	$9,060

The following table presents revenue from contracts with customers based on the timing of revenue recognition for the periods indicated:

	Three Months Ended
	September 30,
	2025	2024
(In thousands)
Products and services transferred at a point in time	$3,802	$4,012
Products and services transferred over time	5,966	5,048
Total revenue from contracts with customers	$9,768	$9,060

	Nine Months Ended September 30,
	2025		2024
	Total	Revenue from	Total	Revenue from
	Recorded	Contracts with	Recorded	Contracts with
	Revenue	Customers	Revenue	Customers
(In thousands)
Total Interest Income	$1,259,705	$—	$1,388,186	$—
Noninterest Income:
Service charges on deposit accounts	14,108	14,108	13,813	13,813
Commissions and fees	29,113	14,602	25,027	13,708
Leased equipment income	31,336	—	40,379	—
(Loss) gain on sale of loans	(133)	—	625	—
Loss on sale of securities	—	—	(59,946)	—
Dividends and gains on equity investments	4,500	—	7,964	—
Warrant income	1,365	—	65	—
LOCOM HFS adjustment	(9)	—	218	—
Other income	20,288	559	20,011	396
Total noninterest income	100,568	29,269	48,156	27,917
Total Revenue	$1,360,273	$29,269	$1,436,342	$27,917

The following table presents revenue from contracts with customers based on the timing of revenue recognition for the periods indicated:

	Nine Months Ended
	September 30,
	2025	2024
(In thousands)
Products and services transferred at a point in time	$12,053	$13,093
Products and services transferred over time	17,216	14,824
Total revenue from contracts with customers	$29,269	$27,917

Contract Balances

The following table provides information about receivables, contract assets, and contract liabilities from contracts with customers as of the dates indicated:

	September 30, 2025	December 31, 2024
(In thousands)
Receivables, which are included in "Other assets"	$1,649	$1,679
Contract liabilities, which are included in "Accrued interest payable and other liabilities"	$296	$348

Contract liabilities relate to advance consideration received from customers for which revenue is recognized over the life of the contract. The change in contract liabilities for the nine months ended September 30, 2025 due to revenue recognized that was included in the contract liability balance at the beginning of the period was$52,000.

NOTE 15. STOCKHOLDERS' EQUITY

Stock-Based Compensation

At the special meeting of stockholders held on November 22, 2023, the Company's stockholders approved the Amended and Restated Banc of California, Inc. 2018 Stock Incentive Plan (the “Amended and Restated 2018 Plan”). The Company’s Amended and Restated 2018 Plan permits stock-based compensation awards to officers, directors, employees, and consultants and will remain in effect until November 30, 2033. The Amended and Restated 2018 Plan authorizes grants of stock-based compensation instruments to purchase or issue up to 10,717,882 shares. As of September 30, 2025, there were 3,392,919 shares available for grant under the Amended and Restated 2018 Plan. In addition to the Amended and Restated 2018 Plan, in connection with the November 30, 2023 merger of PacWest Bancorp with and into Banc of California, Inc. (the “Merger”), the Company assumed the Amended and Restated PacWest Bancorp 2017 Stock Incentive Plan (the "PacWest 2017 Plan") with respect to PacWest's outstanding stock-based awards.

Restricted Stock (RSUs, TRSAs, and PSUs)

Restricted stock amortization totaled$5.9 million and$5.2 million for the three months ended September 30, 2025 and 2024 and $17.3 million and$13.3 million for thenine months ended September 30, 2025 and 2024. Such amounts are included in "Compensation expense" on the condensed consolidated statements of earnings. The amount of unrecognized compensation expense related to all unvested RSUs, TRSAs, and PSUs as of September 30, 2025 totaled$49.8 million.

Restricted Stock Units and Time-Based Restricted Stock Awards

At September 30, 2025, there were 2,611,113 shares of unvested RSUs outstanding pursuant to the Amended and Restated 2018 Plan. At September 30, 2025, there were 78,656 shares of unvested TRSAs outstanding pursuant to the PacWest 2017 Plan. The RSUs and TRSAs generally vest over a service period ofthree orfour years from the date of the grant or immediately upon death of an employee. Compensation expense related to RSUs and TRSAs is based on the fair value of the underlying stock on the award date and is recognized over the vesting period using the straight‑line method. TRSAs were assumed by the Company in connection with the Merger and continue to vest in accordance with the original vesting schedule of the awards.

Performance Stock Units

At September 30, 2025, there were 2,426,262 units of unvested PSUs outstanding. Compensation expense related to the PSUs is based on the fair value of the underlying stock on the award date and is amortized over the vesting period using the straight-line method unless it is determined that: (1) attainment of the financial metrics is less than probable, in which case a portion of the amortization is suspended, or (2) attainment of the financial metrics is improbable, in which case a portion of the previously recognized amortization is reversed and also suspended. Annual PSU expense may vary during the performance period based upon changes in management's estimate of the number of shares that may ultimately vest. In the case where the performance target for the PSUs is based on a market condition (such as total shareholder return), the amortization is neither reversed nor suspended if it is subsequently determined that the attainment of the performance target is less than probable or improbable and the employee continues to meet the service requirement of the award.

Classes of Stock and Equity Instruments

Preferred Stock

Depositary shares each representing 1/40th of a share of 7.75% Fixed Rate Reset Non-Cumulative Perpetual Preferred Stock, Series F (“Series F Preferred Stock”) are listed on the NYSE under the symbol “BANC/PF.” The Series F Preferred Stock ranks senior to our common stock and common stock equivalents both as to dividends and liquidation preference but generally have no voting rights. There are 50,000,000 total preferred shares authorized, of which 27,000,000 were authorized for the non-voting common stock equivalents (“NVCE”) and 513,250 were authorized and outstanding for the Series F Preferred stock at September 30, 2025 and December 31, 2024.

Common Stock

Our voting common stock is listed on the NYSE under the symbol “BANC” and there were 446,863,844 shares authorized at September 30, 2025 and December 31, 2024 and 150,826,212 shares outstanding at September 30, 2025 and 158,346,529 shares outstanding at December 31, 2024.

Class B Non-Voting Common Stock

Our Class B non-voting, non-convertible common stock is not listed or traded on any national securities exchange or automated quotation system, and there currently is no established trading market for such stock. The Class B non-voting common stock ranks equally with, and has identical rights, preferences, and privileges as the voting common stock with respect to dividends and liquidation preference but generally have no voting rights. There were 3,136,156 shares authorized at September 30, 2025 and December 31, 2024 and 477,321 shares outstanding at September 30, 2025 and at December 31, 2024.

Non-Voting Common Stock Equivalents

In conjunction with the Merger, the Company issued a new class of NVCE from authorized preferred stock, which were issued under the Investment Agreements (as defined below). Our NVCE stock is not listed or traded on any national securities exchange or automated quotation system, and there currently is no established trading market for such stock. The NVCE stock does not have voting rights and ranks equally with, and has identical rights, preferences, and privileges as, the voting common stock with respect to dividends or distributions (including regular quarterly dividends) declared by the Board and rights upon any liquidation, dissolution, winding up or similar proceeding of the Company. The NVCE stock is convertible into shares of voting common stock on a one-for-one basis, generally upon transfer to an eligible holder or the occurrence of other specified events in accordance with the terms of the Warburg Investment Agreements with affiliates of funds managed by Warburg Pincus LLC (the "Warburg Investors"). There were 27,000,000 shares of NVCE stock authorized at September 30, 2025 and December 31, 2024 and 4,140,600 shares of NVCE stock outstanding at September 30, 2025 and 9,790,600 at December 31, 2024.

During the third quarter of 2025, certain affiliates of Warburg Pincus LLC sold 4,500,000 shares of the Company’s NVCE in a negotiated block trade with a third party at a price per share of $16.38. The transaction was executed at a market-based price reflecting a customary block trade discount, and the NVCE shares automatically converted to common shares upon sale. The Company also repurchased 1,150,000 shares of its NVCE stock from the Warburg Investors at that same price per share under the Company's authorized share repurchase program. The repurchased shares were retired upon settlement and recorded as a reduction to stockholders’ equity.

Warrants

In conjunction with the Merger and per the terms of the investment agreements, each dated July 25, 2023, entered into by Banc of California, Inc. with the Warburg Investors (such agreement, the "Warburg Investment Agreement") and the Centerbridge Investor (together with the Warburg Investment Agreement, the "Investment Agreements"), respectively, the Warburg Investors received warrants to purchase 15,853,659 shares of NVCE stock (the "Warburg Warrants"), and the Centerbridge Investor received warrants to purchase 3,048,780 shares of voting common stock (the “Centerbridge Warrants”), each with an initial exercise price of $15.375 per share, subject to customary anti-dilution adjustments provided for under the warrant agreements. The warrants carry a term ofseven years but are subject to mandatory exercise when the market price of the voting common stock reaches or exceeds $24.60 for 20 or more trading days during any 30-consecutive trading day period. These warrants are being accounted for as equity. The exercise price of the Centerbridge Warrants will be adjusted downward, per the terms of their warrant agreement, and the exercise price of the Warburg Warrants will also be adjusted, per the terms of their warrant agreement and the NVCE Articles Supplementary, for cash distributions to stockholders of the Company’s voting common stock, including the Company’s quarterly cash dividend.

In addition to their holdings of NVCE and warrants, the Warburg Investors beneficially owned approximately 10.34% of the Company’s outstanding voting common stock as of September 30, 2025. See Note 17. Related Party Transactionsfor additional information regarding these holdings.

Stock Repurchase Program

On March 17, 2025, we announced that our Board of Directors authorized the repurchase of up to $150.0 million of our common stock. On April 23, 2025, we announced an upsize of the stock repurchase program from $150.0 million to $300.0 million and expanded the program to cover both the Company's common stock and depositary shares representing its preferred stock. The repurchase authorization expires in March 2026.

During the first quarter of 2025, common stock repurchased under the program totaled 2,684,823 shares at a weighted average price per share of $14.36, or $38.5 million in the aggregate. During the second quarter of 2025, common stock repurchased under the program totaled 8,809,814 shares at a weighted average price per share of $12.65, or $111.5 million in the aggregate. During the third quarter of 2025, common and common equivalent stock repurchased under the program totaled 2,153,792 shares at a weighted average price per share of $16.48, or $35.5 million in aggregate. The third quarter of 2025 repurchases include 1,150,000 shares of our NVCE stock from the Warburg Investors at a price per share of $16.38. During the nine months ended September 30, 2025, common and common equivalent stock repurchased under the program totaled 13,648,429 shares at a weighted average price per share of $13.59, or $185.5 million in the aggregate. As of September 30, 2025, the Company had $114.5 million remaining under the stock repurchase authorization.

Purchases may be made in open-market transactions, in block transactions on or off an exchange, in privately negotiated transactions or by other means as determined by our management and in accordance with the regulations of the SEC. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements, and market conditions. The program may be changed, suspended, or discontinued at any time.

NOTE 16. SEGMENT REPORTING

The Company provides banking and treasury management services to small-, middle-market, and venture-backed businesses. The principal business activities of the Company are gathering deposits, originating and servicing loans and leases, and investing in investment securities. The Company's CODM is the Chief Executive Officer.

The Company operates asone reportable segment, Commercial Banking, based on how the CODM manages the business activities. The CODM uses net earnings to evaluate income generated from segment assets, assess performance, decide how to allocate resources, determine dividend availability, establish management's compensation, and guide other strategic decisions. The accounting policies of the Commercial Banking segment are the same as those described in Note 1. Nature of Operations and Summary of Significant Accounting Policies, of our audited consolidated financial statements included in our Form 10-K. Additionally, the Company does not have intra-entity sales or transfers.

The following presents our operating segment income statement, including significant expense categories, regularly reviewed by the CODM, and the reconciliation of segment net earnings to consolidated net earnings for the periods indicated:

Three Months Ended · Nine Months Ended
Income Statement	September 30,		September 30,
Commercial Banking Segment	2025	2024	2025	2024
(In thousands)
Total interest income	$432,541	$446,893	$1,259,705	$1,388,186
Total interest expense	179,097	214,718	533,681	697,421
Net interest income	253,444	232,175	726,024	690,765
Provision for credit losses	9,700	9,000	58,100	30,000
Net interest income after provision for credit losses	243,744	223,175	667,924	660,765
Noninterest income	34,285	(15,452)	100,568	48,156
Noninterest expense:
Compensation	88,865	85,585	263,644	263,735
Customer related expense	26,227	34,475	80,555	97,799
Occupancy	15,415	16,892	45,898	52,315
Information technology and data processing	13,535	14,995	41,707	45,872
Insurance and assessments	8,994	12,708	25,680	59,600
Intangible asset amortization	7,160	8,485	21,479	25,373
Leased equipment depreciation	6,750	7,144	20,191	22,175
Other professional services	5,394	5,101	16,313	15,359
Loan expense	4,947	3,994	11,927	12,817
Acquisition, integration and reorganization costs	—	(510)	—	(13,160)
Other expense(1)	8,397	7,340	27,812	28,485
Total noninterest expense	185,684	196,209	555,206	610,370
Earnings before income taxes	92,345	11,514	213,286	98,551
Income tax expense	22,716	2,730	61,704	28,582
Segment net earnings(2)	$69,629	$8,784	$151,582	$69,969

(1)Includes business development expense, communications expense, stationery and supplies, employee related expenses, operating and other losses, OREO expenses, and other corporate overhead and operating expenses.

(2)Segment earnings is the same as net earnings reported on the condensed consolidated statements of earnings.

The following presents our operating segment balance sheet information and the reconciliation of segment assets to consolidated total assets as of the dates indicated:

Balance Sheet Data	September 30,	December 31,
Commercial Banking Segment	2025	2024
(In thousands)
Segment total assets (1)	$34,012,965	$33,542,864

(1)Segment total assets is the same as total assets reported on the condensed consolidated balance sheets.

NOTE 17. RELATED PARTY TRANSACTIONS

Certain of our executive officers and directors, and their related interests, are customers of, or have had transactions with, the Bank in the ordinary course of business, including deposits, loans, and other financial services-related transactions. From time to time, the Bank may make loans to executive officers and directors, and their related interests, in the ordinary course of business and on substantially the same terms and conditions, including interest rates and collateral, as those of comparable transactions with non-insiders prevailing at the time, in accordance with the Bank's underwriting guidelines, and do not involve more than the normal risk of collectability or present other unfavorable features. As of September 30, 2025, no related party loans were categorized as nonaccrual, past due, restructured, or potential problem loans.

Transactions with Related Parties

The Company and the Bank have engaged in the transaction described below with the Company's current directors, executive officers, and beneficial owners of more than five percent of the outstanding shares of the Company's voting common stock and certain persons related to them.

The Company is a party to a services agreement with IntraFi Network LLC (“IntraFi”) whereby IntraFi provides the Bank with certain insured cash sweep services from time to time. Affiliates of funds managed by Warburg Pincus LLC hold a material investment interest in IntraFi. Additionally, one of Warburg Pincus LLC’s principals, Todd Schell, who currently serves as a member of the Board, is a member of the board of directors of IntraFi. Affiliates of funds managed by Warburg Pincus LLC beneficially owned approximately 10.34% of the Company’s outstanding voting common stock as of September 30, 2025, based on information reported on a Schedule 13D filed with the SEC on August 1, 2024. For the three and nine months ended September 30, 2025, the amounts paid to IntraFi for certain insured cash sweep services were $1.9 million and $5.6 million, and were $1.8 million and $6.0 million for the three and nine months ended September 30, 2024.

During the third quarter of 2025, the Company also repurchased 1,150,000 shares of our NVCE stock from the Warburg Investors. See Note 15. Stockholders’ Equity for additional information regarding this transaction.

NOTE 18. SUBSEQUENT EVENTS

Common Stock Dividend

On November 6, 2025, the Company announced that the Board of Directors had declared a quarterly cash dividend of $0.10 per common share. The cash dividend is payable on January 2, 2026, to stockholders of record at the close of business on December 15, 2025.

Preferred Stock Dividend

On November 6, 2025, the Company announced that the Board of Directors had declared a quarterly cash dividend of $0.4845 per Depositary Share. The cash dividend is payable on December 1, 2025 to stockholders of record at the close of business on November 20, 2025.

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