Banc of California (NYSE: BANC) reported Q4 EPS of $0.21, $0.04 better than the analyst estimate of $0.17.

Highlights for the fourth quarter (as compared to third quarter 2019) included:

• Net interest margin increased 18 basis points to 3.04%
• Cost of total deposits decreased by 21 basis points to 1.27%
• Noninterest-bearing deposit balances increased to 20.1% of total deposits, up from 19.2%
• Average noninterest-bearing deposits increased by $60 million, or 5.7%
• Return on average assets was 0.71% and return on average equity was 6.20%

“2019 was the beginning of the transformation of Banc of California,” said Jared Wolff, President and Chief Executive Officer of Banc of California. “We successfully executed on each of our key strategic priorities, reducing cost of deposits, lowering expenses and right-sizing the balance sheet. As a result of our efforts, we have solidified our foundation as a relationship focused business bank, and are poised to create true franchise value going forward.”

Mr. Wolff continued, “As we enter 2020, we will continue to build on the momentum from 2019, remixing our loans and deposits to improve our franchise, and expanding our presence in the key lending segments we are targeting. Further, having built up excess capital, we will be looking for opportunities to deploy it that optimize our franchise and improve earnings in the future. We look forward to showing progress on these initiatives in 2020.”

Lynn Hopkins, Chief Financial Officer of Banc of California said, “The significant improvement in our cost of funds drove the 18 basis point increase in our net interest margin as interest earning asset yields remained steady at 4.50%. Our overall cost of funds decreased to 1.55% as we have been able to reduce our reliance on wholesale funding sources. The fourth quarter, average noninterest-bearing deposit balances increased for the third consecutive quarter and represented over 19% of our total average deposits. Looking forward, we expect to continue seeing benefits from the loan and securities remixing activities and we are well-positioned to show ongoing improvement on both sides of the balance sheet.”

For earnings history and earnings-related data on Banc of California (BANC) click here.