0001795815-26-000005
SEC filingSouthern California Bancorp (BCAL) reported strong financial performance for fiscal year 2025, with net income of $63.1 million and earnings per share of $2.00 (basic and diluted). Key drivers included robust net interest income of $169.1 million, supported by $226.0 million in total interest and dividend income, partially offset by $56.9 million in interest expense. The company benefited from a reversal of provision for credit losses of $8.8 million, contributing to net interest income after provision of $177.9 million. Noninterest income totaled $11.1 million, while noninterest expenses were $101.0 million. The balance sheet shows total assets of $4.03 billion, with loans held for investment net of $3.00 billion and total deposits of $3.37 billion. Cash flow from operations was $57.3 million. The company completed a merger with California BanCorp (CALB) on July 31, 2024, expanding its footprint into Northern California and adding scale. Forward-looking significance includes managing risks related to commercial real estate concentration (469.3% of total risk-based capital), interest rate sensitivity, and economic conditions in California.
Southern California Bancorp (BCAL) reported net income of $63.1 million for fiscal year 2025, with earnings per share of $2.00 (basic and diluted). The company generated total interest and dividend income of $226.0 million, primarily from interest and fees on loans ($195.9 million) and interest on deposits at other financial institutions ($18.7 million). Interest expense totaled $56.9 million, resulting in net interest income of $169.1 million. A reversal of provision for credit losses of $8.8 million boosted net interest income after provision to $177.9 million. Noninterest income was $11.1 million, including income from bank owned life insurance ($2.3 million) and other charges and fees ($3.1 million). Noninterest expenses were $101.0 million, led by salaries and employee benefits ($62.3 million). Income before taxes was $88.0 million, with income tax expense of $24.9 million.
Revenue is primarily driven by interest income, with loans contributing $195.9 million (86.7% of total interest income). Other significant components include interest on deposits at other financial institutions ($18.7 million) and interest on debt securities ($7.8 million). Noninterest income sources are diversified, with bank owned life insurance ($2.3 million), other charges and fees ($3.1 million), and gain on sale of loans ($577K). The company completed a merger with California BanCorp (CALB) on July 31, 2024, expanding its geographic footprint into Northern California and adding scale through complementary business models. At the time of the merger, CALB had total loans of $1.43 billion, total assets of $1.91 billion, and total deposits of $1.64 billion.
Net interest margin is implied by net interest income of $169.1 million relative to interest-earning assets, though specific margin percentages are not disclosed in the provided data. Profitability is supported by the reversal of provision for credit losses ($8.8 million), reducing expense impacts. Noninterest expenses are controlled, with the largest component being salaries and employee benefits ($62.3 million), representing 61.7% of total noninterest expenses. Other significant costs include occupancy and equipment ($8.6 million), data processing and communications ($7.6 million), and intangible asset amortization ($3.8 million). Litigation settlements netted $2.0 million in expenses.
Operating cash flow was $57.3 million, driven by net income of $63.1 million adjusted for non-cash items like depreciation ($1.8 million) and accretion of net discounts ($21.3 million). Investing activities provided $29.8 million, primarily from proceeds from maturities of debt securities ($38.4 million) offset by purchases of debt securities ($122.4 million). Financing activities used $75.3 million, mainly due to net decrease in deposits ($28.1 million) and repayment of other borrowings ($38.0 million). The balance sheet shows total assets of $4.03 billion, with key components including cash and cash equivalents ($399.9 million), loans held for investment net ($3.00 billion), and goodwill ($110.9 million). Liabilities total $3.46 billion, predominantly deposits ($3.37 billion). Shareholders' equity is $576.6 million.
Management highlights risks including commercial real estate concentration, with CRE loans representing 469.3% of total risk-based capital as of December 31, 2025, potentially leading to heightened regulatory scrutiny and capital requirements. Interest rate shifts may affect net interest income, and the company is vulnerable to economic downturns in California. The February 2026 U.S. Supreme Court ruling on tariffs introduces uncertainty in trade policy, which could impact economic conditions and credit quality. Strategic priorities include integrating the CALB merger to build scale and increase market share. The company maintains a share repurchase program, with 122,428 shares repurchased in 2025 at an average price of $16.37 per share. Liquidity risks are noted, with reliance on deposits and potential outflows if depositor confidence declines.