California Bancorp 公布第二季純利1430萬美元，第三季股息增至每股0.12美元

EX-99.1
2
ex99-1.htm
EX-99.1

 

 

Exhibit
99.1

 

 

CALIFORNIA
BANCORP REPORTS STRONG SECOND QUARTER EARNINGS, SIGNIFICANT LOAN GROWTH AND IMPROVED CREDIT QUALITY

 

—
Company to increase its quarterly dividend by $0.02 to $0.12 per common share in the third quarter of 2026 

 

San
Diego, Calif., July 27, 2026 – California BanCorp (“us,” “we,” “our,” or the “Company”)
(NASDAQ: BCAL), the holding company for California Bank of Commerce, N.A. (the “Bank”) announces its consolidated financial
results for the second quarter of 2026.

 

The
Company reported net income of $14.3 million, or $0.44 per diluted share, for the second quarter of 2026, compared to $13.8 million,
or $0.42 per diluted share for the first quarter of 2026, and $14.1 million, or $0.43 per diluted share for the second quarter of 2025.

 

“I
am pleased to report a very solid second quarter by the Bank, highlighted by strong earnings of $14.3 million, meaningful loan growth
of $113.7 million, and a significant improvement in credit quality, with nonperforming assets to total assets decreasing more than 50%
to 0.44% from 0.97%,” said David Rainer, Chairman and CEO of the Company and Bank. “I’m also pleased to report our
loan growth was well balanced, reflecting our ability to generate new banking relationships with businesses throughout our footprint.
Given our strong performance and capital position, we are increasing our quarterly dividend to $0.12 beginning in the third quarter.”

 

“We
continue to focus on our organic growth strategy, with top tier bankers in each of our California markets,” said Richard Hernandez,
President of the Company and Bank. “Despite strong competition in our footprint, our team successfully generated new client relationships
and increased business development activity in each of our regional commercial banking offices. We remain confident in the strength of
our franchise and our ability to continue growing in a disciplined and profitable manner.”

 

Second
Quarter 2026 Highlights

 

 
  
 ●
 Net
 income of $14.3 million or $0.44 diluted earnings per share for the second quarter. 

 
  
 ●
 Net
 interest margin of 4.71%, compared with 4.47% in the prior quarter. 

 
  
 ●
 Provision
 for credit losses of $714 thousand for the second quarter, compared with reversal of provision for credit losses of $381 thousand
 for the prior quarter.

 
  
 ●
 Return
 on average assets of 1.43%, compared with 1.36% in the prior quarter.

 
  
 ●
 Return
 on average common equity of 9.84%, compared with 9.62% in the prior quarter.

 
  
 ●
 Return
on average tangible common equity (non-GAAP1) of 12.62%, compared with 12.37% in the prior quarter.

 
  
 ●
 Total
 loans, including loans held for sale, increased to $3.11 billion at June 30, 2026, up $113.7 million, or 3.8%, from $3.00 billion
 at March 31, 2026.

 
  
 ●
 Nonperforming
 loans were $8.9 million, down $21.7 million, or 70.9%, from March 31, 2026.

 
  
 ●
 Nonperforming
 assets to total assets ratio of 0.44% at June 30, 2026, compared with 0.97% at March 31, 2026. 

 
  
 ●
 Allowance
 for credit losses (“ACL”) was 1.18% of total loans held for investment at June 30, 2026, compared to 1.21% at March
 31, 2026; allowance for loan losses (“ALL”) was 1.13% of total loans held for investment at June 30, 2026, compared to
 1.14% at March 31, 2026.

 

 

1 Reconciliations
 of non–U.S. generally accepted accounting principles (“GAAP”) measures are set forth at the end of this press
 release.

 

  

  

 

 

 
  
 ●
 Noninterest-bearing
 deposits represented 37.4% of total deposits, compared with 36.8% of total deposits at March 31, 2026. 

 
  
 ●
 Cost
 of deposits was 1.31%, compared to 1.29% in the prior quarter.

 
  
 ●
 Cost
 of funds was 1.38%, compared with 1.36% in the prior quarter.

 
  
 ●
 Repurchased
 102,594 shares of common stock at an average price of $19.46 and a total cost of $2.0 million under the stock repurchase program
 in the second quarter of 2026, compared to 409,915 shares of common stock at an average price of $18.08 and a total cost of $7.4
 million in the first quarter of 2026. 

 
  
 ●
 Dividend
 of $0.10 per common share declared in May 2026 and paid in July 2026, totaling $3.3 million.

 
  
 ●
 Tangible
 book value per common share (non-GAAP1) of $14.29 at June 30, 2026, up $0.32 from $13.97 at March 31, 2026.

 
  
 ●
 The
 Company’s preliminary capital ratios at June 30, 2026 exceed the minimums required to be “well-capitalized,”
 the highest regulatory capital category.

 
 

The
Company’s Board of Directors approved the regular quarterly cash dividend of $0.12 per share to holders of its common stock, an
increase of $0.02 per share from the prior quarter. The dividend is expected to be paid on October 15, 2026, to shareholders of record
at the close of the business day on September 21, 2026.

 

Second
Quarter Operating Results

 

Net
Income

 

Net
income for the second quarter of 2026 was $14.3 million, or $0.44 per diluted share, compared with $13.8 million, or $0.42 per diluted
share in the first quarter of 2026. Pre-tax, pre-provision income (non-GAAP1) for the second quarter was $20.6 million, an
increase of $1.9 million, or 9.89%, from the prior quarter. The net income and diluted earnings per share increase were largely driven
by higher net interest income, and lower noninterest expense, partially offset by a higher provision for credit losses and lower noninterest
income.

 

Net
Interest Income and Net Interest Margin

 

Net
interest income for the second quarter of 2026 was $43.4 million, compared with $42.1 million in the prior quarter. The increase in net
interest income was primarily due to a $1.1 million increase in total interest and dividend income, coupled with a $123 thousand decrease
in total interest expense in the second quarter of 2026, as compared with the prior quarter. The increase in net interest income was
also impacted by one additional day in the current quarter compared with the prior quarter.

 

During
the second quarter of 2026, total interest income increased by $1.1 million. The increase was primarily driven by a $2.3 million increase
in loan interest income, which included an increase of $98 thousand in accretion from the net purchase accounting discounts on acquired
loans and $600 thousand in cash interest collections from the payoff of two nonaccrual loans, net of $56 thousand in reversals of interest
income on loans placed on nonaccrual, coupled with an increase of $749 thousand in total debt securities income. These increases were
partially offset by a decrease of $1.7 million in interest income from deposits in other financial institutions and a decrease of $225
thousand in dividend income from restricted stock investments and other bank stock. The increase in interest income was mainly due to
a 25 basis point increase in the yield on average total interest-earning assets, including increases in average total loans of $23.6
million, and average total debt securities of $49.4 million, offset by decreases in average deposits in other financial institutions
of $195.9 million and average Fed funds sold/resale agreements of $4.1 million. The decrease in interest expense for the second quarter
of 2026 was primarily due to a $119 thousand decrease in interest expense on average total interest-bearing deposits, the result of lower
average total interest-bearing deposits of $132.4 million, partially offset by an 8 basis point increase in the cost of average total
interest-bearing deposits.

 

 2

  

 

 

Net
interest margin for the second quarter of 2026 was 4.71%, compared with 4.47% in the prior quarter. The expansion of the net interest
margin by 24 basis points was primarily driven by higher loan yields, a 6 basis point increase from the resolution of certain nonaccrual
loans, and continued benefit from purchase accounting accretion. Total interest-earning assets yield increased by 25 basis points, partially
offset by a 2 basis point increase in the cost of funds. The yield on total average interest-earning assets in the second quarter of
2026 was 5.97%, compared with 5.72% in the prior quarter. The yield on average total loans in the second quarter of 2026 was 6.34%, an
increase of 20 basis points from 6.14% in the prior quarter. The yield on average total loans in the second quarter of 2026 included
the impact of the cash interest collection from the payoff of two nonaccrual loans, net of reversals of interest income on loans placed
on nonaccrual noted above, which increased the overall total loan yield by 7 basis points. There was a $479 thousand reversal of interest
income in the prior quarter which negatively impacted the net interest margin by 6 basis points. Accretion income from the net purchase
accounting discounts on acquired loans was $3.3 million, increasing the yield on average total loans by 44 basis points; the net amortization
expense from the purchase accounting discounts on acquired subordinated debt and acquired time deposits premium increased interest expense
by $389 thousand, the combination of which increased the net interest margin by 32 basis points in the second quarter of 2026. In the
prior quarter, accretion income from the net purchase accounting discounts on acquired loans was $3.2 million, increasing the yield on
average total loans by 44 basis points; the net amortization expense from the purchase accounting discounts on acquired subordinated
debt and acquired time deposits premium increased the interest expense by $388 thousand, the combination of which increased the net interest
margin by 30 basis points.

 

Cost
of funds for the second quarter of 2026 was 1.38%, an increase of 2 basis points from 1.36% in the prior quarter. The increase was primarily
driven by an 8 basis point increase in the cost of average total interest-bearing deposits. The amortization expense of $389 thousand
from the purchase accounting discounts on acquired subordinated debt and acquired time deposits premium contributed 5 basis points to
the cost of funds. Average noninterest-bearing demand deposits increased $18.6 million to $1.22 billion and represented 36.7% of total
average deposits for the second quarter of 2026, compared with $1.21 billion and 34.9%, respectively, in the prior quarter; average interest-bearing
deposits decreased $132.4 million to $2.11 billion during the second quarter of 2026. The total cost of deposits in the second quarter
of 2026 was 1.31%, compared with 1.29% in the prior quarter. The cost of total interest-bearing deposits increased 8 basis points, driven
primarily by changes in the Company’s deposit mix and overall competition for deposits driving market deposit rates upward in the
second quarter of 2026.

 

Average
total borrowings increased $51 thousand to $34.4 million in the second quarter of 2026, primarily due to a $384 thousand increase in
average subordinated debt due to accretion of discounts, partially offset by a $333 thousand decrease in average Federal Home Loan Bank
(“FHLB”) advances from an overnight advance. The average cost of total borrowings was 8.10% for the second quarter of 2026,
down from 8.25% in the prior quarter.

 

Provision
for Credit Losses

 

The
Company recorded a provision for credit losses of $714 thousand for the second quarter of 2026, compared with a reversal of provision
for credit losses of $381 thousand in the prior quarter. The provision for credit losses in the second quarter of 2026 was comprised
of a $1.1 million provision for credit losses on loans held for investment, partially offset by a $336 thousand reversal of provision
for credit losses for unfunded loan commitments during the second quarter of 2026. Total unfunded loan commitments decreased by $28.2
million to $896.9 million at June 30, 2026, compared to $925.1 million in unfunded loan commitments at March 31, 2026.

 

The
provision for credit losses for loans held for investment in the second quarter of 2026 was $1.1 million, an increase of $1.4 million
from a reversal of provision for credit losses of $381 thousand in the prior quarter. The increase reflected updates to the reasonable
and supportable economic forecasts for California, continued loan growth, changes in portfolio composition, and higher substandard accruing
loan balances, partially offset by refinements to the qualitative factors and scenario weighting. The Company’s management continues
to monitor macroeconomic variables including changes in interest rates, uncertainty in the current economic environment, and elevated
geopolitical risks related to ongoing conflicts in the Middle East. Management believes it has appropriately provisioned for the current
environment.

 

Noninterest
Income

 

Total
noninterest income was $1.6 million in the second quarter of 2026, a decrease of $586 thousand compared with $2.1 million in the first
quarter of 2026. Other charges and fees decreased $534 thousand in the second quarter due primarily to a loss from equity investments
of $251 thousand in the second quarter of 2026 compared to income of $181 thousand in the prior quarter.

 

 3

  

 

 

Noninterest
Expense

 

Total
noninterest expense for the second quarter of 2026 was $24.3 million, a decrease of $1.2 million from total noninterest expense of $25.5
million in the prior quarter. Salaries and employee benefits decreased $1.0 million during the second quarter of 2026 to $15.5 million
primarily because the previous quarter included increases in payroll taxes typically occurring in the first quarter each year, coupled
with the increase in loan origination costs deferred based on increased loan origination activity. The decrease in other expenses of
$424 thousand was due primarily to the decreases in loan related expenses and valuation write-downs on loans held for sale. There were
no valuation write-downs on loans held for sale in the second quarter of 2026, compared with $266 thousand in the prior quarter.

 

Efficiency
ratio (non-GAAP1) for the second quarter of 2026 was 54.22%, compared with 57.69% in the prior quarter.

 

Income
Tax

 

In
the second quarter of 2026, the Company’s income tax expense was $5.5 million, compared with $5.3 million for the first quarter
of 2026. The effective rate was 27.9% for the second quarter of 2026 and 27.8% for the first quarter of 2026.

 

Balance
Sheet

 

Assets

 

Total
assets at June 30, 2026 were $4.03 billion, a decrease of $23.5 million or 0.6% from March 31, 2026. The decrease in total assets from
the prior quarter was primarily related to decreases in cash and cash equivalents of $146.2 million, partially offset by a $113.7 million
increase in loans, including loans held for sale and a $10.2 million increase in available-for-sale debt securities.

 

Loans

 

Total
loans held for investment (“LHFI”) were $3.09 billion at June 30, 2026, an increase of $121.9 million, compared with March
31, 2026. During the second quarter of 2026, there were new originations of $245.6 million, including $26.5 million of short-term participation
purchases in fully collateralized mortgage loans, net advances of $32.4 million, and the transfer of $7.4 million of SBA 7(a) loans from
loans held for sale to loans held for investment at net amortized cost. These increases were partially offset by $163.3 million loan
payoffs, including a $5.7 million discounted note sale that resulted in a $127 thousand charge-off. Total loans secured by real estate
increased by $75.7 million, of which other commercial real estate loans increased $58.2 million; multifamily loans increased $13.3 million,
and 1-4 family residential loans increased by $10.7 million; commercial and industrial loans increased by $45.6 million, including $26.5
million of aforementioned participation purchases in mortgage loans through approved warehouse facilities; and other consumer loans increased
by $629 thousand. These increases were partially offset by a decrease in construction and land development loans of $6.5 million.

 

The
Company had $15.8 million in loans held for sale at June 30, 2026, consisting entirely of consumer solar loans, compared with $24.1 million
at March 31, 2026, consisting of $7.6 million of SBA 7(a) loans and $16.5 million of consumer solar loans. During the second quarter
of 2026, the Company transferred its $7.4 million SBA 7(a) loans held for sale to loans held for investment at net amortized cost. The
Company did not record a valuation write-down related to its consumer solar loans in the second quarter of 2026. In the first quarter
of 2026, the Company recorded a valuation allowance of $266 thousand related to these loans.

 

Deposits

 

Total
deposits at June 30, 2026 were $3.36 billion, a decrease of $34.4 million from March 31, 2026. The decrease was primarily due to decreases
in interest-bearing non-maturity deposits of $30.0 million, non-brokered time deposits of $13.9 million, partially offset by an increase
in noninterest-bearing demand deposits of $9.5 million. Noninterest-bearing demand deposits at June 30, 2026, were $1.26 billion, or
37.4% of total deposits, compared with $1.25 billion, or 36.8% of total deposits at March 31, 2026. At June 30, 2026, total interest-bearing
deposits were $2.10 billion, compared with $2.15 billion at March 31, 2026. At June 30, 2026, the Company did not have any brokered time
deposits. The Company offers the Insured Cash Sweep product and Certificate of Deposit Account Registry Service, each of which provides
reciprocal deposit placement services to fully qualified large customer deposits for FDIC insurance among other participating banks.
Total reciprocal deposits were $705.2 million, or 21.0% of total deposits at June 30, 2026, compared with $723.7 million, or 21.3% of
total deposits at March 31, 2026.

 

 4

  

 

 

Federal
Home Loan Bank (“FHLB”) and Liquidity

 

At
June 30, 2026 and March 31, 2026, the Company had no FHLB or Federal Reserve Discount Window borrowings.

 

At
June 30, 2026, the Company had available borrowing capacity from an FHLB secured line of credit of approximately $719.8 million and available
borrowing capacity from the Federal Reserve Discount Window of approximately $329.7 million. The Company also had available borrowing
capacity from four unsecured credit lines from correspondent banks of approximately $90.5 million at June 30, 2026, with no outstanding
borrowings. Total available borrowing capacity was $1.14 billion at June 30, 2026. Additionally, the Company had unpledged liquid securities
at fair value of approximately $211.0 million and cash and cash equivalents of $265.0 million at June 30, 2026.

 

The
Company intends to redeem all $35.0 million of its 3.50% fixed-to-floating rate subordinated debt due September 1, 2031, at par value
during the third quarter of 2026. Starting in September 2026, the interest rate on that subordinated debt is scheduled to transition
from a fixed rate to a quarterly variable rate equal to the then current 90-day SOFR plus 2.86%, through the contractual maturity date
of September 1, 2031.

 

Asset
Quality

 

Total
non-performing assets were $17.5 million, or 0.44% of total assets at June 30, 2026, a decrease of $21.7 million, or 55.3%, from $39.2
million, or 0.97% of total assets, at March 31, 2026. Total non-performing loans were $8.9 million, or 0.29% of total loans held for
investment at June 30, 2026, compared with $30.6 million, or 1.03% of total loans held for investment at March 31, 2026.

 

Total
nonperforming loans decreased $21.7 million, or 70.9%, during the second quarter of 2026 primarily reflecting the resolution of three
nonperforming commercial real estate loans that had been downgraded in the prior quarter, including the full repayment of two loans with
a combined net carrying value of $17.8 million and the discounted note sale of a $5.7 million loan, which resulted in a $127 thousand
charge-off. In addition, existing nonperforming loans had net paydowns of $758 thousand during the quarter. These decreases were partially
offset by the downgrade of a 1-4 family residential investment loan with a net carrying value of $2.7 million at June 30, 2026. This
loan is classified as an individually evaluated, collateral-dependent loan and no allowance was recorded at June 30, 2026, as a full
repayment is anticipated.

 

Special
mention loans decreased by $5.0 million during the second quarter of 2026 to $48.6 million at June 30, 2026. The decrease in the special
mention loans was due mostly to $7.7 million of loans downgraded to substandard, coupled with $3.7 million in payoffs and $70 thousand
in upgrades to pass rating, partially offset by $5.1 million of loans downgraded from pass rating, and $1.3 million in net advances,

 

Substandard
loans decreased by $8.2 million during the second quarter of 2026 to $64.2 million at June 30, 2026. The decrease in the substandard
loans was due primarily to the aforementioned payoffs and discounted note sales of three nonperforming commercial real estate loans totaling
$23.6 million, coupled with $6.0 million of other payoffs and $1.2 million of net paydowns, partially offset by $14.9 million of downgrades
from pass risk rating to substandard accruing and $7.7 million of downgrades from special mention to substandard accruing.

 

The
Company had no LHFI that were over 90 days past due and still accruing interest at June 30, 2026 and March 31, 2026, respectively.

 

Loan
delinquencies (30-89 days past due, excluding nonaccrual loans) totaled $4.9 million at June 30, 2026, compared with $12.8 million in
such loan delinquencies at March 31, 2026. The decrease was primarily due to $10.0 million of loans brought to current, and $2.7 million
of 1-4 family residential loan downgraded to nonaccrual, partially offset by $4.5 million of loans that became delinquent during the
second quarter of 2026.

 

The
allowance for credit losses, which is comprised of the ALL and reserve for unfunded loan commitments, totaled $36.6 million at June 30,
2026, compared with $36.1 million at March 31, 2026. The $522 thousand increase in the allowance for credit losses included a $1.1 million
provision for credit losses for the loan portfolio, net charge-offs of $192 thousand, and a $336 thousand reversal of provision for credit
losses for unfunded loan commitments for the quarter ended June 30, 2026.

 

The
ALL was $34.9 million, or 1.13% of total loans held for investment at June 30, 2026, compared with $34.0 million, or 1.14% at March 31,
2026.

 

 5

  

 

 

Capital

 

Tangible
book value per common share (non-GAAP1) at June 30, 2026 was $14.29, compared with $13.97 at March 31, 2026. In the second
quarter of 2026, tangible book value was primarily impacted by net income of $14.3 million for the second quarter, and stock-based compensation
activity. This was partially offset by an increase in net of tax unrealized losses on available-for-sale debt securities, the Company’s
stock repurchase program activity, and cash dividends, which reduced the tangible book value per common share by $0.05, $0.06 and $0.10,
respectively. Other comprehensive losses related to net of tax unrealized losses on available-for-sale debt securities increased by $1.5
million to $5.3 million at June 30, 2026, from $3.8 million at March 31, 2026. The increase in the net of tax unrealized losses on available-for-sale
debt securities was attributable to non-credit related factors, including a decrease in bond prices at the long end of the yield curve
and the general interest rate environment, and growth in the available-for-sale debt securities. Tangible common equity (non-GAAP1)
as a percentage of total tangible assets (non-GAAP1) at June 30, 2026, increased to 11.77% from 11.46% in the prior quarter,
and net of tax unrealized losses on available-for-sale debt securities as a percentage of tangible common equity (non-GAAP1)
at June 30, 2026 increased to 1.2% from 0.8% in the prior quarter.

 

The
Company’s preliminary capital ratios exceed the minimums required to be “well-capitalized” at June 30, 2026.

 

Stock
Repurchase Program

 

During
the second quarter of 2026, the Company repurchased 102,594 shares of its common stock at an average price of $19.46 and a total cost
of $2.0 million under the stock repurchase program, compared to 409,915 shares of common stock at an average price of $18.08 and a total
cost of $7.4 million in the first quarter of 2026. The remaining maximum number of shares authorized to be repurchased under this program
was 875,563 shares at June 30, 2026.

 

 6

  

 

 

ABOUT
CALIFORNIA BANCORP

 

California
BanCorp (NASDAQ: BCAL) is a registered bank holding company headquartered in San Diego, California. California Bank of Commerce, N.A.,
a national banking association chartered under the laws of the United States (the “Bank”) and regulated by the Office of
the Comptroller of the Currency, is a wholly owned subsidiary of California BanCorp. Established in 2001 and headquartered in San Diego,
California, the Bank offers a range of financial products and services to individuals, professionals, and small to medium-sized businesses
through its 14 branch offices including 11 commercial banking offices serving California. The Bank’s solutions-driven, relationship-based
approach to banking provides accessibility to decision makers and enhances value through strong partnerships with its clients. Additional
information is available at www.californiabankofcommerce.com.

 

CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

In
addition to historical information, this release includes forward-looking statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated
events or trends and other matters that are not historical facts. Examples of forward-looking statements include, among others, statements
regarding expectations, plans or objectives for future operations, products or services, loan recoveries, projections, and expectations
regarding the adequacy of reserves for credit losses, as well as forecasts relating to financial and operating results or other measures
of economic performance. Forward-looking statements reflect management’s current view about future events and involve risks and
uncertainties that may cause actual results to differ from those expressed in the forward-looking statement or historical results. Forward-looking
statements can be identified by the fact that they do not relate strictly to historical or current facts and often include the words
or phrases such as “aim,” “can,” “may,” “could,” “predict,” “should,”
“will,” “would,” “believe,” “anticipate,” “estimate,” “expect,”
“hope,” “intend,” “plan,” “potential,” “project,” “will likely result,”
“continue,” “seek,” “shall,” “possible,” “projection,” “optimistic,”
and “outlook,” and variations of these words and similar expressions.

 

Factors
that could cause or contribute to results differing from those in or implied in the forward-looking statements include but are not limited
to the impact of bank failures or other adverse developments at other banks on general investor sentiment regarding the stability and
liquidity of banks; changes in real estate markets and valuations; the impact on financial markets from geopolitical conflicts; inflation,
interest rate, market and monetary fluctuations and general economic conditions, either nationally or locally in the areas in which the
Company conducts business; increases in competitive pressures among financial institutions and businesses offering similar products and
services; general credit risks related to lending, including changes in the value of real estate or other collateral, the financial condition
of borrowers, the effectiveness of our underwriting practices and the risk of fraud; higher than anticipated defaults in the Company’s
loan portfolio; changes in management’s estimate of the adequacy of the allowance for credit losses or the factors the Company
uses to determine the allowance for credit losses; changes in demand for loans and other products and services offered by the Company;
the possibility that the Company may reduce or discontinue the payment of dividends on its common stock; the possibility that the Company
may discontinue, reduce or otherwise limit the level of repurchases of its common stock that it may make from time to time pursuant to
its stock repurchase program; the costs and outcomes of litigation; legislative or regulatory changes or changes in accounting principles,
policies or guidelines; and other risk factors discussed in the Company’s Annual Report on Form 10-K for the year ended December
31, 2025, filed with the Securities and Exchange Commission (“SEC”) and other documents the Company may file with the SEC
from time to time.

 

Additional
information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained
in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, and other documents the Company files with the
SEC from time to time.

 

Any
forward-looking statement made in this release is based only on information currently available to management and speaks only as of the
date on which it is made. The Company does not undertake, and specifically disclaims any obligation, to update any forward-looking statements
to reflect occurrences or unanticipated events or circumstances after the date of such statements or to conform such forward-looking
statements to actual results or to changes in its opinions or expectations, except as required by law.

 

 7

  

 

 

California
BanCorp and Subsidiary

Financial
Highlights (Unaudited)

 

 
   
 At
 or for the 
 Three
 Months Ended
  
 At
 or for the 
 Six
 Months Ended
 

 
   
 June
 30,
 2026
  
 March
 31,
 2026
  
 June
 30,
 2025
  
 June
 30,
 2026
  
 June
 30,
 2025
 

 
  
 ($
 in thousands except share and per share data) 

 
 EARNINGS 
   

 
 Net
 interest income 
 $43,354  
 $42,084  
 $41,417  
 $85,438  
 $83,672 

 
 Provision
 for (reversal of) credit losses 
 $714  
 $(381) 
 $(634) 
 $333  
 $(4,410)

 
 Noninterest
 income 
 $1,551  
 $2,137  
 $2,856  
 $3,688  
 $5,422 

 
 Noninterest
 expense 
 $24,346  
 $25,512  
 $24,833  
 $49,858  
 $49,753 

 
 Income
 tax expense 
 $5,545  
 $5,299  
 $5,975  
 $10,844  
 $12,799 

 
 Net
 income 
 $14,300  
 $13,791  
 $14,099  
 $28,091  
 $30,952 

 
 Pre-tax
 pre-provision income (1) 
 $20,559  
 $18,709  
 $19,440  
 $39,268  
 $39,341 

 
 Diluted
 earnings per share 
 $0.44  
 $0.42  
 $0.43  
 $0.86  
 $0.95 

 
 Shares
 outstanding at period end 
  32,110,117  
  32,152,298  
  32,463,311  
  32,110,117  
  32,463,311 

 
   
     
     
     
     
    

 
 PERFORMANCE
 RATIOS 
     
     
     
     
    

 
 Return
 on average assets 
  1.43% 
  1.36% 
  1.45% 
  1.40% 
  1.58%

 
 Return
 on average common equity 
  9.84% 
  9.62% 
  10.50% 
  9.73% 
  11.81%

 
 Yield
 on total loans 
  6.34% 
  6.14% 
  6.58% 
  6.24% 
  6.59%

 
 Yield
 on interest earning assets 
  5.97% 
  5.72% 
  6.21% 
  5.84% 
  6.24%

 
 Cost
 of deposits 
  1.31% 
  1.29% 
  1.59% 
  1.30% 
  1.59%

 
 Cost
 of funds 
  1.38% 
  1.36% 
  1.73% 
  1.37% 
  1.73%

 
 Net
 interest margin 
  4.71% 
  4.47% 
  4.61% 
  4.59% 
  4.63%

 
 Efficiency
 ratio (1) 
  54.22% 
  57.69% 
  56.09% 
  55.94% 
  55.84%

 

 

 
   
 As
 of 

 
   
 June
 30,
 2026
  
 March
 31,
 2026
  
 December
 31,
 2025
 

 
  
 ($
 in thousands except share and per share data) 

 
 CAPITAL 
   

 
 Tangible
 equity to tangible assets (1) 
  11.77% 
  11.46% 
  11.45%

 
 Book
 value (BV) per common share 
 $18.27  
 $17.97  
 $17.79 

 
 Tangible
 BV per common share (1) 
 $14.29  
 $13.97  
 $13.79 

 
 ASSET
 QUALITY 
     
     
    

 
 Allowance
 for loan losses (ALL) 
 $34,860  
 $34,002  
 $34,348 

 
 Reserve
 for unfunded loan commitments 
 $1,769  
 $2,105  
 $2,105 

 
 Allowance
 for credit losses (ACL) 
 $36,629  
 $36,107  
 $36,453 

 
 Allowance
 for loan losses to nonperforming loans 
  390.7% 
  111.0% 
  213.5%

 
 ALL
 to total loans held for investment 
  1.13% 
  1.14% 
  1.13%

 
 ACL
 to total loans held for investment 
  1.18% 
  1.21% 
  1.20%

 
 30-89
 days past due, excluding nonaccrual loans 
 $4,941  
 $12,793  
 $14,735 

 
 Over
 90 days past due, excluding nonaccrual loans 
 $—  
 $—  
 $— 

 
 Special
 mention loans 
 $48,640  
 $53,680  
 $72,407 

 
 Special
 mention loans to total loans held for investment 
  1.57% 
  1.81% 
  2.39%

 
 Substandard
 loans 
 $64,209  
 $72,392  
 $60,681 

 
 Substandard
 loans to total loans held for investment 
  2.07% 
  2.44% 
  2.00%

 
 Nonperforming
 loans 
 $8,922  
 $30,625  
 $16,086 

 
 Nonperforming
 loans to total loans held for investment 
  0.29% 
  1.03% 
  0.53%

 
 Other
 real estate owned, net 
 $8,613  
 $8,613  
 $— 

 
 Nonperforming
 assets 
 $17,535  
 $39,238  
 $16,086 

 
 Nonperforming
 assets to total assets 
  0.44% 
  0.97% 
  0.40%

 

 8

  

 

 

 
   
 As
 of 

 
   
 June
 30,
 2026
  
 March
 31,
 2026
  
 December
 31,
 2025
 

 
  
 ($
 in thousands except share and per share data) 

 
 END OF
 PERIOD BALANCES 
   

 
 Total loans,
 including loans held for sale 
 $3,110,581  
 $2,996,929  
 $3,058,992 

 
 Total assets 
 $4,025,259  
 $4,048,734  
 $4,033,386 

 
 Deposits 
 $3,359,105  
 $3,393,485  
 $3,370,581 

 
 Loans to deposits 
  92.6% 
  88.3% 
  90.8%

 
 Shareholders’ equity 
 $586,640  
 $577,835  
 $576,586 

 

 

(1)
Non-GAAP measure. See – GAAP to Non-GAAP reconciliation.

 

 
   
 At
 or for the 
 Three
 Months Ended
  
 At
 or for the 
 Six
 Months Ended
 

 
 ALLOWANCE
 for CREDIT LOSSES 
 June
 30,
 2026
  
 March
 31,
 2026
  
 June
 30,
 2025
  
 June
 30,
 2026
  
 June
 30,
 2025
 

 
   
 ($
 in thousands) 

 
 Allowance
 for loan losses 
     
     
     
     
    

 
 Balance at beginning
 of period 
 $34,002  
 $34,348  
 $45,839  
 $34,348  
 $50,540 

 
 Provision for (reversal of)
 credit losses 
  1,050  
  (381) 
  (663) 
  669  
  (3,821)

 
 Charge-offs 
  (193) 
  —  
  (4,247) 
  (193) 
  (7,406)

 
 Recoveries 
  1  
  35  
  181  
  36  
  1,797 

 
 Net (charge-offs)
 recoveries 
  (192) 
  35  
  (4,066) 
  (157) 
  (5,609)

 
 Balance,
 end of period 
 $34,860  
 $34,002  
 $41,110  
 $34,860  
 $41,110 

 
 Reserve
 for unfunded loan commitments (1) 
     
     
     
     
    

 
 Balance, beginning of period 
 $2,105  
 $2,105  
 $2,485  
 $2,105  
 $3,103 

 
 (Reversal
 of) provision for credit losses 
  (336) 
  —  
  29  
  (336) 
  (589)

 
 Balance,
 end of period 
  1,769  
  2,105  
  2,514  
  1,769  
  2,514 

 
 Allowance
 for credit losses 
 $36,629  
 $36,107  
 $43,624  
 $36,629  
 $43,624 

 
   
     
     
     
     
    

 
 ALL to total loans held for
 investment 
  1.13% 
  1.14% 
  1.37% 
  1.13% 
  1.37%

 
 ACL to total loans held for
 investment 
  1.18% 
  1.21% 
  1.46% 
  1.18% 
  1.46%

 
 Net (charge-offs) recoveries
 to average total loans 
  (0.03)% 
  0.00% 
  (0.54)% 
  (0.01)% 
  (0.37)%

 

 

 

(1)
Included in “Accrued interest and other liabilities” on the consolidated balance sheets.

 

 9

  

 

 

California
BanCorp and Subsidiary

Balance
Sheets (Unaudited)

 

 
   
 June
 30,
 2026
  
 March
 31,
 2026
  
 December
 31,
 2025
 

 
  
 ($
 in thousands) 

 
 ASSETS 
   

 
 Cash and due from
 banks 
 $55,196  
 $56,390  
 $52,013 

 
 Federal
 funds sold & other interest-bearing balances 
  209,755  
  354,750  
  347,900 

 
 Total
 cash and cash equivalents 
  264,951  
  411,140  
  399,913 

 
   
     
     
    

 
 Debt securities available-for-sale,
 at fair value (amortized cost of $316,289, $303,968 and $237,191 at June 30, 2026, March 31, 2026 and December 31, 2025) 
  308,792  
  298,617  
  234,890 

 
 Debt securities held-to-maturity,
 at cost (fair value of $49,054, $48,467 and $49,308 at June 30, 2026, March 31, 2026 and December 31, 2025) 
  52,761  
  52,849  
  52,936 

 
 Loans held for sale 
  15,828  
  24,096  
  25,105 

 
 Loans held for investment: 
     
     
    

 
 Construction
 & land development 
  133,828  
  140,345  
  138,894 

 
 1-4 family
 residential 
  139,841  
  129,121  
  142,399 

 
 Multifamily 
  286,296  
  273,007  
  324,075 

 
 Other
 commercial real estate 
  1,906,910  
  1,848,663  
  1,820,445 

 
 Commercial
 & industrial 
  625,212  
  579,660  
  605,859 

 
 Other
 consumer 
  2,666  
  2,037  
  2,215 

 
 Total
 loans held for investment 
  3,094,753  
  2,972,833  
  3,033,887 

 
 Allowance
 for credit losses - loans 
  (34,860) 
  (34,002) 
  (34,348)

 
 Total
 loans held for investment, net 
  3,059,893  
  2,938,831  
  2,999,539 

 
   
     
     
    

 
 Restricted stock at cost 
  30,941  
  30,940  
  30,932 

 
 Premises and equipment 
  12,154  
  11,978  
  12,116 

 
 Right of use asset 
  14,664  
  15,463  
  15,094 

 
 Other real estate owned, net 
  8,613  
  8,613  
  — 

 
 Goodwill 
  110,934  
  110,934  
  110,934 

 
 Intangible assets 
  16,880  
  17,680  
  18,480 

 
 Bank owned life insurance 
  67,903  
  67,407  
  67,367 

 
 Deferred taxes, net 
  26,054  
  26,184  
  29,041 

 
 Accrued
 interest and other assets 
  34,891  
  34,002  
  37,039 

 
 Total
 assets 
 $4,025,259  
 $4,048,734  
 $4,033,386 

 
   
     
     
    

 
 LIABILITIES
 AND SHAREHOLDERS’ EQUITY 
     
     
    

 
 Deposits: 
     
     
    

 
 Noninterest-bearing
 demand 
 $1,256,822  
 $1,247,363  
 $1,178,256 

 
 Interest-bearing
 NOW accounts 
  819,746  
  833,601  
  840,593 

 
 Money
 market and savings accounts 
  1,190,498  
  1,206,598  
  1,223,486 

 
 Time
 deposits 
  92,039  
  105,923  
  128,246 

 
 Total deposits 
  3,359,105  
  3,393,485  
  3,370,581 

 
   
     
     
    

 
 Borrowings 
  34,611  
  34,221  
  33,832 

 
 Operating lease liability 
  18,375  
  19,184  
  18,936 

 
 Accrued
 interest and other liabilities 
  26,528  
  24,009  
  33,451 

 
 Total
 liabilities 
  3,438,619  
  3,470,899  
  3,456,800 

 
   
     
     
    

 
 Shareholders’
 Equity: 
     
     
    

 
 Common stock - 50,000,000
 shares authorized, no par value; issued and outstanding 32,110,117, 32,152,298, and 32,418,182 at June 30, 2026, March 31, 2026 and
 December 31, 2025 
  434,514  
  435,249  
  442,394 

 
 Retained earnings 
  157,407  
  146,355  
  135,813 

 
 Accumulated
 other comprehensive loss - net of taxes 
  (5,281) 
  (3,769) 
  (1,621)

 
 Total
 shareholders’ equity 
  586,640  
  577,835  
  576,586 

 
 Total
 liabilities and shareholders’ equity 
 $4,025,259  
 $4,048,734  
 $4,033,386 

 

 

 10

  

 

 

California
BanCorp and Subsidiary

Income
Statements - Quarterly and Year-to-Date (Unaudited)

 

 
   
 Three
 Months Ended  
 Six
 Months Ended 

 
   
 June
 30,
 2026
  
 March
 31,
 2026
  
 June
 30,
 2025
  
 June
 30,
 2026
  
 June
 30,
 2025
 

 
   
 ($
 in thousands except share and per share data) 

 
 INTEREST
 AND DIVIDEND INCOME 
     
     
     
     
    

 
 Interest and fees
 on loans 
 $47,970  
 $45,628  
 $49,080  
 $93,598  
 $99,766 

 
 Interest on debt securities 
  3,528  
  2,778  
  1,751  
  6,306  
  3,275 

 
 Interest on tax-exempted debt
 securities 
  297  
  298  
  304  
  595  
  609 

 
 Interest
 and dividends from other institutions 
  3,137  
  5,081  
  4,651  
  8,218  
  8,961 

 
 Total
 interest and dividend income 
  54,932  
  53,785  
  55,786  
  108,717  
  112,611 

 
   
     
     
     
     
    

 
 INTEREST
 EXPENSE 
     
     
     
     
    

 
 Interest on NOW, savings,
 and money market accounts 
  10,105  
  10,059  
  11,390  
  20,164  
  22,506 

 
 Interest on time deposits 
  778  
  943  
  1,550  
  1,721  
  3,613 

 
 Interest
 on borrowings 
  695  
  699  
  1,429  
  1,394  
  2,820 

 
 Total
 interest expense 
  11,578  
  11,701  
  14,369  
  23,279  
  28,939 

 
 Net interest
 income 
  43,354  
  42,084  
  41,417  
  85,438  
  83,672 

 
 Provision
 for (reversal of) credit losses (1) 
  714  
  (381) 
  (634) 
  333  
  (4,410)

 
 Net interest
 income after provision for (reversal of) credit losses 
  42,640  
  42,465  
  42,051  
  85,105  
  88,082 

 
 NONINTEREST
 INCOME 
     
     
     
     
    

 
 Service charges and fees on
 deposit accounts 
  1,097  
  1,100  
  1,178  
  2,197  
  2,364 

 
 Gain on sale of loans 
  —  
  —  
  —  
  —  
  577 

 
 Bank owned life insurance
 income 
  496  
  518  
  503  
  1,014  
  966 

 
 Servicing and related income
 on loans 
  51  
  78  
  102  
  129  
  244 

 
 Other
 charges and fees 
  (93) 
  441  
  1,073  
  348  
  1,271 

 
 Total
 noninterest income 
  1,551  
  2,137  
  2,856  
  3,688  
  5,422 

 
 NONINTEREST
 EXPENSE 
     
     
     
     
    

 
 Salaries and employee benefits 
  15,544  
  16,550  
  15,293  
  32,094  
  31,157 

 
 Occupancy and equipment expenses 
  1,944  
  1,989  
  2,094  
  3,933  
  4,246 

 
 Data processing 
  2,079  
  1,965  
  1,831  
  4,044  
  3,766 

 
 Legal, audit and professional 
  850  
  709  
  972  
  1,559  
  1,831 

 
 Regulatory assessments 
  544  
  527  
  545  
  1,071  
  1,267 

 
 Director and shareholder expenses 
  352  
  337  
  395  
  689  
  799 

 
 Intangible assets amortization 
  800  
  800  
  948  
  1,600  
  1,896 

 
 Litigation settlements, net 
  —  
  75  
  —  
  75  
  — 

 
 Other real estate owned income,
 net 
  201  
  104  
  862  
  305  
  930 

 
 Other
 expense 
  2,032  
  2,456  
  1,893  
  4,488  
  3,861 

 
 Total
 noninterest expense 
  24,346  
  25,512  
  24,833  
  49,858  
  49,753 

 
 Income
 before income taxes 
  19,845  
  19,090  
  20,074  
  38,935  
  43,751 

 
 Income
 tax expense 
  5,545  
  5,299  
  5,975  
  10,844  
  12,799 

 
 Net
 income 
 $14,300  
 $13,791  
 $14,099  
 $28,091  
 $30,952 

 
   
     
     
     
     
    

 
 Net income per share - basic 
 $0.44  
 $0.43  
 $0.43  
 $0.87  
 $0.96 

 
 Net income per share - diluted 
 $0.44  
 $0.42  
 $0.43  
 $0.86  
 $0.95 

 
 Weighted average common shares-diluted 
  32,395,945  
  32,675,943  
  32,685,132  
  32,535,171  
  32,691,643 

 

 

(1)
Included (reversal of) provision for credit losses on unfunded loan commitments of $(336) thousand, zero and $29 thousand for the three
months ended June 30, 2026, March 31, 2026, and June 30, 2025, respectively; and $(336) thousand and $(589) thousand for the six months
ended June 30, 2026 and June 30, 2025, respectively.

 

 11

  

 

 

California
BanCorp and Subsidiary

Average
Balance Sheets and Yield Analysis

(Unaudited)

 

 
   
 Three
 Months Ended 

 
   
 June
 30, 2026  
 March
 31, 2026  
 June
 30, 2025 

 
   
 Average
 Balance  
 Income/
 Expense
  
 Yield/
 Cost
  
 Average
 Balance  
 Income/
 Expense
  
 Yield/
 Cost
  
 Average
 Balance  
 Income/
 Expense
  
 Yield/
 Cost
 

 
  
 ($
 in thousands) 

 
 Assets 
   

 
 Interest-earning
 assets: 
     
     
     
     
     
     
     
     
    

 
 Total loans 
 $3,037,033  
 $47,970  
  6.34% 
 $3,013,389  
 $45,628  
  6.14% 
 $2,992,299  
 $49,080  
  6.58%

 
 Taxable debt securities 
  306,837  
  3,528  
  4.61% 
  257,350  
  2,778  
  4.38% 
  164,558  
  1,751  
  4.27%

 
 Tax-exempt debt securities
 (1) 
  52,262  
  297  
  2.89% 
  52,350  
  298  
  2.92% 
  53,438  
  304  
  2.89%

 
 Deposits in other financial
 institutions 
  230,941  
  2,123  
  3.69% 
  426,830  
  3,843  
  3.65% 
  295,602  
  3,270  
  4.44%

 
 Fed funds sold/resale agreements 
  30,700  
  301  
  3.93% 
  34,836  
  300  
  3.49% 
  65,568  
  730  
  4.47%

 
 Restricted
 stock investments and other bank stock 
  31,759  
  713  
  9.00% 
  31,756  
  938  
  11.98% 
  31,672  
  651  
  8.24%

 
 Total
 interest-earning assets 
  3,689,532  
  54,932  
  5.97% 
  3,816,511  
  53,785  
  5.72% 
  3,603,137  
  55,786  
  6.21%

 
 Total
 noninterest-earning assets 
  307,720  
     
     
  297,987  
     
     
  302,142  
     
    

 
 Total
 Assets 
 $3,997,252  
     
     
 $4,114,498  
     
     
 $3,905,279  
     
    

 
   
     
     
     
     
     
     
     
     
    

 
 Liabilities
 and Shareholders’ Equity 
     
     
     
     
     
     
     
     
    

 
 Interest-bearing
 liabilities: 
     
     
     
     
     
     
     
     
    

 
 Interest-bearing NOW accounts 
 $838,323  
 $3,543  
  1.70% 
 $919,891  
 $3,362  
  1.48% 
 $763,987  
 $3,666  
  1.92%

 
 Money market and savings accounts 
  1,176,250  
  6,562  
  2.24% 
  1,208,718  
  6,697  
  2.25% 
  1,149,286  
  7,724  
  2.70%

 
 Time
 deposits 
  96,848  
  778  
  3.22% 
  115,179  
  943  
  3.32% 
  165,049  
  1,550  
  3.77%

 
 Total
 interest-bearing deposits 
  2,111,421  
  10,883  
  2.07% 
  2,243,788  
  11,002  
  1.99% 
  2,078,322  
  12,940  
  2.50%

 
 Borrowings: 
     
     
     
     
     
     
     
     
    

 
 FHLB advances 
  —  
  —  
   —%
   
  333  
  3  
  3.98% 
  —  
  —  
   —
 %

 
 Subordinated
 debt 
  34,421  
  695  
  8.10% 
  34,037  
  696  
  8.29% 
  67,159  
  1,429  
  8.53%

 
 Total
 borrowings 
  34,421  
  695  
  8.10% 
  34,370  
  699  
  8.25% 
  67,159  
  1,429  
  8.53%

 
 Total interest-bearing liabilities 
  2,145,842  
  11,578  
  2.16% 
  2,278,158  
  11,701  
  2.08% 
  2,145,481  
  14,369  
  2.69%

 
   
     
     
     
     
     
     
     
     
    

 
 Noninterest-bearing liabilities: 
     
     
     
     
     
     
     
     
    

 
 Noninterest-bearing
 deposits (2) 
  1,224,016  
     
     
  1,205,464  
     
     
  1,179,791  
     
    

 
 Other
 liabilities 
  44,695  
     
     
  49,692  
     
     
  41,629  
     
    

 
 Shareholders’
 equity 
  582,699  
     
     
  581,184  
     
     
  538,378  
     
    

 
 Total
 Liabilities and Shareholders’ Equity 
 $3,997,252  
     
     
 $4,114,498  
     
     
 $3,905,279  
     
    

 
   
     
     
     
     
     
     
     
     
    

 
 Net interest
 spread 
     
     
  3.81% 
     
     
  3.64% 
     
     
  3.52%

 
 Net
 interest income and margin 
     
 $43,354  
  4.71% 
     
 $42,084  
  4.47% 
     
 $41,417  
  4.61%

 
 Cost of deposits 
 $3,335,437  
 $10,883  
  1.31% 
 $3,449,252  
 $11,002  
  1.29% 
 $3,258,113  
 $12,940  
  1.59%

 
 Cost of funds 
 $3,369,858  
 $11,578  
  1.38% 
 $3,483,622  
 $11,701  
  1.36% 
 $3,325,272  
 $14,369  
  1.73%

 

 

(1)
Tax-exempt debt securities yields are presented on a tax equivalent basis using a 21% tax rate.

(2)
Average noninterest-bearing deposits represent 36.70%, 34.95% and 36.21% of average total deposits for the three months ended June 30,
2026, March 31, 2026 and June 30, 2025, respectively.

 

 12

  

 

 

California
BanCorp and Subsidiary

Average
Balance Sheets and Yield Analysis

(Unaudited)

 

 
   
 Six
 Months Ended 

 
   
 June
 30, 2026  
 June
 30, 2025 

 
   
 Average
 Balance  
 Income/
 Expense
  
 Yield/
 Cost
  
 Average
 Balance  
 Income/
 Expense
  
 Yield/
 Cost
 

 
  
 ($
 in thousands) 

 
 Assets 
   

 
 Interest-earning
 assets: 
     
     
     
     
     
    

 
 Total loans 
 $3,025,276  
 $93,598  
  6.24% 
 $3,050,686  
 $99,766  
  6.59%

 
 Taxable debt securities 
  282,230  
  6,306  
  4.51% 
  152,089  
  3,275  
  4.34%

 
 Tax-exempt debt securities
 (1) 
  52,306  
  595  
  2.90% 
  53,480  
  609  
  2.91%

 
 Deposits in other financial
 institutions 
  328,344  
  5,966  
  3.66% 
  306,034  
  6,738  
  4.44%

 
 Fed funds sold/resale agreements 
  32,756  
  601  
  3.70% 
  48,088  
  1,065  
  4.47%

 
 Restricted
 stock investments and other bank stock 
  31,757  
  1,651  
  10.48% 
  31,665  
  1,158  
  7.37%

 
 Total interest-earning
 assets 
  3,752,669  
  108,717  
  5.84% 
  3,642,042  
  112,611  
  6.24%

 
 Total
 noninterest-earning assets 
  302,882  
     
     
  310,092  
     
    

 
 Total
 Assets 
 $4,055,551  
     
     
 $3,952,134  
     
    

 
   
     
     
     
     
     
    

 
 Liabilities
 and Shareholders’ Equity 
     
     
     
     
     
    

 
 Interest-bearing
 liabilities: 
     
     
     
     
     
    

 
 Interest-bearing NOW accounts 
 $878,882  
 $6,905  
  1.58% 
 $749,677  
 $7,032  
  1.89%

 
 Money market and savings
 accounts 
  1,192,394  
  13,259  
  2.24% 
  1,155,588  
  15,474  
  2.70%

 
 Time
 deposits 
  105,963  
  1,721  
  3.28% 
  186,167  
  3,613  
  3.91%

 
 Total interest-bearing
 deposits 
  2,177,239  
  21,885  
  2.03% 
  2,091,432  
  26,119  
  2.52%

 
 Borrowings: 
     
     
     
     
     
    

 
 FHLB advances 
  166  
  3  
  3.97% 
  —  
  —  
   —
 %

 
 Subordinated
 debt 
  34,230  
  1,391  
  8.19% 
  68,585  
  2,820  
  8.29%

 
 Total
 borrowings 
  34,396  
  1,394  
  8.17% 
  68,585  
  2,820  
  8.29%

 
 Total interest-bearing
 liabilities 
  2,211,635  
  23,279  
  2.12% 
  2,160,017  
  28,939  
  2.70%

 
   
     
     
     
     
     
    

 
 Noninterest-bearing liabilities: 
     
     
     
     
     
    

 
 Noninterest-bearing deposits
 (2) 
  1,214,791  
     
     
  1,217,627  
     
    

 
 Other liabilities 
  47,180  
     
     
  45,974  
     
    

 
 Shareholders’
 equity 
  581,945  
     
     
  528,516  
     
    

 
 Total
 Liabilities and Shareholders’ Equity 
 $4,055,551  
     
     
 $3,952,134  
     
    

 
   
     
     
     
     
     
    

 
 Net
 interest spread 
     
     
  3.72% 
     
     
  3.54%

 
 Net
 interest income and margin 
     
 $85,438  
  4.59% 
     
 $83,672  
  4.63%

 
 Cost of deposits 
 $3,392,03