GlobeNewswire Inc | Jan 19, 2022 04:30PM EST

January 19, 2022

LOS ANGELES, Jan. 19, 2022 (GLOBE NEWSWIRE) -- PacWest Bancorp (Nasdaq: PACW) -

FOURTH QUARTER 2021 RESULTS

$136.0M $1.14 $181.7M 22.06%Net Earnings Diluted Earnings PPNR ROATE per Share

FOURTH QUARTER 2021 HIGHLIGHTS

-- Net Earnings of $136.0 Million or $1.14 Per Diluted Share -- Core Deposits Up $4.6 Billion or 16.3% of which $4.1 Billion Related to the Acquisition of the HOA Business in October; Represents 93% of Total Deposits -- Loan Growth of $2.4 Billion or 11.8% -- Civic Loan Production of $480 Million in 4Q21, Compared to $481 Million in 3Q21 -- PPNR of $181.7 Million, Up 8.3% Compared to 3Q21 -- Provision for Credit Losses Benefit of $6.0 Million in 4Q21 Compared to Benefit of $20.0 Million in 3Q21 -- Net Interest Income (TE) of $304.5 Million in 4Q21, Compared to $279.8 Million in 3Q21 -- Noninterest Income of $57.4 Million in 4Q21, Compared to $51.3 Million in 3Q21, With Continued Strength in Warrant Income -- Noninterest Expense of $176.1 Million in 4Q21, Up 10.5% From 3Q21, Due Mainly to First Quarter of Operating Expenses Related to Acquired HOA Business plus Acquisition Costs of $5.6 Million -- Classified and Special Mention Loans Fell $25.5 Million and $104.8 Million, Respectively, From 3Q21 -- ACL Ratio of 1.19% and ALLL Ratio of 0.87% -- Net Charge-offs of $169 Thousand -- Cost of Deposits Remained at 8bps -- Loan and Lease Production of $3.4 Billion, Up From $2.4 Billion in 3Q21; WAC of 3.89% vs. 4.24% in 3Q21 -- Strong Capital Position CET1 Ratio of 8.86% and Total Capital Ratio of 12.69% at 4Q21 -- Tangible Book Value Per Share Decreased From $22.57 at 3Q21 to $21.31 at 4Q21 Due Mainly to Cash Used for the HOA Acquisition

FULL YEAR 2021 RESULTS

$607.0M $5.10 $660.3M 24.41%Net Earnings Diluted Earnings PPNR ROATE per Share

FULL YEAR 2021 HIGHLIGHTS

-- Net Earnings of $607.0 Million or $5.10 Per Diluted Share -- Core Deposits Up $10.5 Billion or 47.0% in 2021; Venture Banking Up $4.5 Billion; HOA Acquisition Added $4.1 Billion -- Loan Growth of $3.9 Billion or 20.2% -- PPNR of $660.3 Million, Up 2.1% Compared to 2020 -- Provision for Credit Losses Benefit of $162.0 Million in 2021 Compared to Provision of $339.0 Million in 2020 -- Net Interest Income (TE) of $1.1 Billion in 2021, Compared to $1.0 Billion in 2020 -- Classified and Special Mention Loans Fell $149.2 Million and $329.7 Million, Respectively, From 2020 -- Net Recoveries of $1.9 Million -- Cost of Deposits 9bps for 2021 Down From 27 bps in 2020 -- Loan and Lease Production of $9.1 Billion, Up From $4.2 Billion in 2020; WAC of 4.19% vs. 3.57% in 2020 -- Tangible Book Value Per Share Increased From $21.05 at the End of 2020 to $21.31 at the End of 2021 -- Noninterest Income of $193.9 Million in 2021, Compared to $146.1 Million in 2020, With Record Warrant Income of $49.3 Million in 2021

CEO COMMENTARY

Matt Wagner, President and CEO, commented, We are very pleased to deliver another strong quarter. We deployed approximately $3.8 billion of excess liquidity into higher-yielding securities and loans during the fourth quarter which resulted in a $24.6 million increase in net interest income and helped drive a $13.9 million increase in our pre-tax pre-provision net revenue compared to the third quarter. Loans grew by $2.4 billion in the fourth quarter to an all-time high of $22.9 billion.

We continued to experience strong deposit growth as core deposits increased by $4.6 billion during the fourth quarter driven by the $4.1 billion of deposits acquired with the HOA business.

Credit quality continues the improvement seen throughout 2021 with net recoveries of $1.9 million for the year and continued decreases in special mention (down 46% in 2021) and classified loans and leases (down 56% in 2021) which resulted in a provision benefit for the fourth consecutive quarter.

We had a strong year in 2021 and produced record net earnings of over $600 million, ended the year with record high balances for loans and deposits and crossed the $40 billion total assets milestone. We completed two strategic acquisitions with Civic Financial Services in February and the HOA business in October which expanded our product offerings and position us well for a rising rate environment.

Our strategy of prioritizing a strong balance sheet, followed by profitability and growth, in that order, served us well in 2021 and we are well positioned as we begin 2022.

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/be14ae62-9832-453c-9087-7d077d54bfcc

FINANCIAL HIGHLIGHTS

' At or For the At or For the Three Months Ended Year Ended December 31, September 30, Increase December 31, IncreaseFinancial 2021 2021 (Decrease) 2021 2020 (Decrease)Highlights (1) (Dollars in thousands, except per share data)Net earnings (loss) $ 136,045 $ 139,996 $ (3,951 ) $ 606,959 $ (1,237,574 ) $ 1,844,533 Diluted earnings $ 1.14 $ 1.17 $ (0.03 ) $ 5.10 $ (10.61 ) $ 15.71 (loss) per sharePre-provision,pre-goodwillimpairment, pre-tax $ 181,677 $ 167,766 $ 13,911 $ 660,334 $ 646,599 $ 13,735 net revenue("PPNR") (2)Return on average 1.34 % 1.55 % (0.21 ) 1.71 % (4.46 )% 6.17 assetsPPNR return on 1.79 % 1.86 % (0.07 ) 1.86 % 2.33 % (0.47 )average assets (2)Return on average 22.06 % 21.03 % 1.03 24.41 % 10.36 % 14.05 tangible equity (2) Yield on averageloans and leases 4.93 % 5.01 % (0.08 ) 5.08 % 5.18 % (0.10 )(tax equivalent)Cost of average 0.08 % 0.08 % - 0.09 % 0.27 % (0.18 )total depositsNet interest margin("NIM") (tax 3.24 % 3.33 % (0.09 ) 3.40 % 4.05 % (0.65 )equivalent)Efficiency ratio 46.2 % 47.2 % (1.0 ) 46.9 % 43.1 % 3.8 Total assets $ 40,443,344 $ 35,885,676 $ 4,557,668 $ 40,443,344 $ 29,498,442 $ 10,944,902 Loans and leasesheld for $ 22,941,548 $ 20,511,020 $ 2,430,528 $ 22,941,548 $ 19,083,377 $ 3,858,171 investment, net ofdeferred feesNoninterest-bearing $ 14,543,133 $ 12,881,806 $ 1,661,327 $ 14,543,133 $ 9,193,827 $ 5,349,306 demand depositsCore deposits $ 32,734,949 $ 28,140,708 $ 4,594,241 $ 32,734,949 $ 22,264,480 $ 10,470,469 Total deposits $ 34,997,757 $ 30,559,745 $ 4,438,012 $ 34,997,757 $ 24,940,717 $ 10,057,040 As percentage of total deposits:Noninterest-bearing 41 % 42 % (1 ) 41 % 37 % 4 demand depositsCore deposits 93 % 92 % 1 93 % 89 % 4 Equity to assets 9.89 % 10.92 % (1.03 ) 9.89 % 12.19 % (2.30 )ratioCommon equity tier 8.86 % 10.15 % (1.29 ) 8.86 % 10.53 % (1.67 )1 capital ratioTotal capital ratio 12.69 % 14.36 % (1.67 ) 12.69 % 13.76 % (1.07 )Tangible common 6.54 % 7.79 % (1.25 ) 6.54 % 8.78 % (2.24 )equity ratio (2)Book value per $ 33.45 $ 32.77 $ 0.68 $ 33.45 $ 30.36 $ 3.09 shareTangible book value $ 21.31 $ 22.57 $ (1.26 ) $ 21.31 $ 21.05 $ 0.26 per share (2) (1) The operations of the Homeowners Association Services business are includedfrom its October 8, 2021 acquisition date and the operations of Civic areincluded from its February 1, 2021 acquisition date.(2) Non-GAAP measure.

INCOME STATEMENT HIGHLIGHTS

NET INTEREST INCOME

Net interest income increased by $24.6 million to $300.4 million for the fourth quarter of 2021 compared to $275.8 million for the third quarter of 2021 due mainly to higher income on investment securities and loans and leases primarily resulting from higher average balances as we deployed our excess liquidity. Income on investment securities increased by $7.7 million in the fourth quarter of 2021 due to a $1.9 billion increase in the average balance of investment securities, offset partially by a 10 basis point decrease in the yield on average investment securities. Income on loans and leases increased by $16.9 million in the fourth quarter of 2021 due to a $1.7 billion increase in the average balance of loans and leases, offset partially by an eight basis point decrease in the yield on average loans and leases. The tax equivalent yield on average loans and leases was 4.93% for the fourth quarter of 2021 compared to 5.01% for the third quarter of 2021. The decrease in the tax equivalent yield on average loans and leases was due primarily to the purchases of lower yielding single-family loans and higher loan premium amortization of $4.1 million.

The tax equivalent NIM was 3.24% for the fourth quarter of 2021 compared to 3.33% for the third quarter of 2021. The decrease in the NIM was due primarily to the change in the earning assets mix driven by the increase in the balance of average investment securities as a percentage of average earning assets and the decrease in the balance of average loans and leases as a percentage of average earning assets, as well as lower yields on average loans and leases and average investment securities. The average balance of investment securities increased by $1.9 billion to $10.0 billion, the average balance of deposits in financial institutions increased by $303.3 million to $6.0 billion, and the average balance of loans and leases increased by $1.7 billion to $21.4 billion in the fourth quarter of 2021. The increase in average balances of investment securities and loans and leases was the result of deploying some of our excess liquidity ahead of the closing of the acquisition of the HOA Services Division of MUFG Union Bank that added approximately $4.1 billion of deposits on October 8, 2021.

The cost of average total deposits was 0.08% in the fourth quarter of 2021, unchanged from 0.08% in the third quarter of 2021.

PROVISION FOR CREDIT LOSSES

The following table presents details of the provision for credit losses for the periods indicated:

Three Months Ended December 31, September 30, IncreaseProvision for Credit Losses 2021 2021 (Decrease) (In thousands)(Reduction in) addition toallowance for loan and lease $ (3,000 ) $ (21,500 ) $ 18,500 losses(Reduction in) addition toreserve for unfunded loan (3,000 ) 1,500 (4,500 )commitmentsTotal provision for credit $ (6,000 ) $ (20,000 ) $ 14,000 losses

The provision for credit losses benefit was $6.0 million for the fourth quarter of 2021 compared to a benefit of $20.0 million for the third quarter of 2021. The fourth quarter benefit was primarily impacted by changes in the qualitative component and a slightly improved economic forecast offset by an increased provision for loan growth.

NONINTEREST INCOME

The following table presents details of noninterest income for the periods indicated:

Three Months Ended December 31, September Increase 30,Noninterest Income 2021 2021 (Decrease) (In thousands)Service charges on deposit $ 3,476 $ 3,407 $ 69 accountsOther commissions and fees 10,633 11,792 (1,159 )Leased equipment income 12,602 10,943 1,659 Gain on sale of loans and leases 172 - 172 Gain on sale of securities 999 515 484 Other income: Dividends and gains on equity (1,570 ) 8,387 (9,957 )investmentsWarrant income 23,990 13,578 10,412 Other 7,080 2,723 4,357 Total noninterest income $ 57,382 $ 51,345 $ 6,037

Noninterest income increased by $6.0 million to $57.4 million for the fourth quarter of 2021 compared to $51.3 million for the third quarter of 2021 due primarily to increases of $10.4 million in warrant income, $4.4 million in other income, and $1.7 million in leased equipment income, offset partially by a $10.0 million decrease in dividends and gains on equity investments. Warrant income increased due to continued strength in the capital markets activity including our single largest warrant gain ever of $13.6 million along with a second warrant gain of $5.2 million. Other income increased due primarily to higher gains from early lease terminations of $4.5 million. Leased equipment income increased due to a higher average balance of leased equipment and the return of one large lease to accrual status in December 2021. Dividends and gains on equity investments decreased due primarily to lower gains on sales of equity investments, higher fair value losses on equity investments still held, and lower income distributions and fair value marks on SBIC investments.

NONINTEREST EXPENSE

The following table presents details of noninterest expense for the periods indicated:

Three Months Ended December 31, September 30, IncreaseNoninterest Expense 2021 2021 (Decrease) (In thousands)Compensation $ 99,700 $ 98,061 $ 1,639 Occupancy 14,656 14,928 (272 )Data processing 8,171 7,391 780 Other professional services 5,946 5,164 782 Insurance and assessments 5,032 3,685 1,347 Intangible asset amortization 3,876 2,890 986 Leased equipment depreciation 9,569 8,603 966 Foreclosed assets (income) (260 ) 165 (425 )expense, netAcquisition, integration and 5,590 200 5,390 reorganization costsCustomer related expense 6,175 4,538 1,637 Loan expense 5,627 4,180 1,447 Other 12,028 9,616 2,412 Total noninterest expense $ 176,110 $ 159,421 $ 16,689

Noninterest expense increased by $16.7 million to $176.1 million for the fourth quarter of 2021 compared to $159.4 million for the third quarter of 2021 due primarily to increases in several expense categories such as compensation expense by $1.6 million, data processing by $0.8 million, insurance and assessments by $1.3 million, intangible asset amortization by $1.0 million, acquisition, integration and reorganization costs by $5.4 million, and customer related expense by $1.6 million. The increases related primarily to the acquisition of the HOA business on October 8, 2021. Total operating expenses for the quarter, excluding the acquisition, integration and reorganization costs of $5.6 million, were $170.5 million including $5.9 million of operating expenses for the acquired HOA business.

INCOME TAXES

The effective income tax rate was 27.5% in the fourth quarter of 2021 compared to 25.4% in the third quarter of 2021. The increase was due primarily to an increase in state tax rates for fiscal year 2021 caused by a shift in apportionment and a tax benefit from the release of a valuation allowance recorded in the third quarter.The effective income tax rate for the full year 2021 was 26.2%. The effective tax rate for the full year 2022 is currently estimated to be in the range of 25% to 27%.

BALANCE SHEET HIGHLIGHTS

DEPOSITS AND CLIENT INVESTMENT FUNDS

The following table presents the composition of our deposit portfolio as of the dates indicated:

December 31, 2021 September 30, 2021 December 31, 2020 % of % of % ofDeposit Composition Balance Total Balance Total Balance Total (Dollars in thousands)Noninterest-bearing demand $ 14,543,133 41 % $ 12,881,806 42 % $ 9,193,827 37 %Interest checking 7,319,898 21 % 7,168,472 24 % 5,974,910 24 %Money market 10,241,265 29 % 7,463,261 24 % 6,532,917 26 %Savings 630,653 2 % 627,169 2 % 562,826 2 %Total core deposits 32,734,949 93 % 28,140,708 92 % 22,264,480 89 %Non-core non-maturity 889,976 3 % 960,438 3 % 1,149,467 5 %depositsTotal non-maturity 33,624,925 96 % 29,101,146 95 % 23,413,947 94 %depositsTime deposits $250,000 and 885,938 3 % 882,551 3 % 994,197 4 %underTime deposits over 486,894 1 % 576,048 2 % 532,573 2 %$250,000Total time deposits 1,372,832 4 % 1,458,599 5 % 1,526,770 6 %Total deposits $ 34,997,757 100 % $ 30,559,745 100 % $ 24,940,717 100 %

At December 31, 2021, core deposits totaled $32.7 billion or 93% of total deposits, including $14.5 billion of noninterest-bearing demand deposits or 41% of total deposits. Core deposits increased by $4.6 billion or 16.3% in the fourth quarter of 2021 driven primarily by the $4.1 billion of core deposits acquired with the HOA business on October 8, 2021.

In addition to deposit products, we also offer alternative, non-depository cash investment options for select clients. These alternative options include investments managed by Pacific Western Asset Management Inc. (PWAM), our registered investment advisor subsidiary, and third-party sweep products. Total off-balance sheet client investment funds at December 31, 2021 were $1.4 billion, of which $0.9 billion was managed by PWAM.

LOANS AND LEASES

The following table presents roll forwards of loans and leases held for investment, net of deferred fees, for the periods indicated:

Three Months Ended Year EndedRoll Forward ofLoans and Leases December 31, September 30, December 31,Heldfor Investment,Net of Deferred 2021 2021 2021 Fees (1) (Dollars in thousands)Balance, beginning $ 20,511,020 $ 19,506,257 $ 19,083,377 of periodAdditions: Production 3,372,815 2,406,024 9,054,767 Disbursements 1,917,195 1,349,333 5,952,158 Total production 5,290,010 3,755,357 15,006,925 and disbursementsReductions: Payoffs (2,000,293 ) (1,732,621 ) (7,337,296 )Paydowns (845,443 ) (1,013,867 ) (3,728,950 )Total payoffs and (2,845,736 ) (2,746,488 ) (11,066,246 )paydownsSales (15,837 ) (2,175 ) (117,263 )Transfers to - (415 ) (1,062 )foreclosed assetsCharge-offs (4,395 ) (1,516 ) (10,715 )Transfers to loans - - (25,554 )held for saleTotal reductions (2,865,968 ) (2,750,594 ) (11,220,840 )Loans acquiredthrough 6,486 - 72,086 acquisitionsNet increase 2,430,528 1,004,763 3,858,171 (decrease)Balance, end of $ 22,941,548 $ 20,511,020 $ 22,941,548 period Weighted averagerate on production 3.89 % 4.24 % 4.19 %(2) (1) Includes direct financing leases but excludes equipment leased to othersunderoperating leases.(2) The weighted average rate on production presents contractual rates on ataxequivalent basis and excludes amortized fees. Amortized fees addedapproximately38 basis points to loan yields in 2021.

Loans and leases held for investment, net of deferred fees, increased by $2.4 billion or 11.8% in the fourth quarter of 2021 to $22.9 billion at December 31, 2021. Excluding PPP loan activity, loans grew by $2.5 billion or 12.6%. The overall increase in the loans and leases balance for the fourth quarter of 2021 was due primarily to increases in the income producing and other residential, venture capital, and asset-based portfolios, offset partially by a reduction in the commercial real estate construction portfolio. Civic loan production was $480 million in the fourth quarter of 2021 compared to $481 million in the third quarter of 2021. The total outstanding balance of the Civic loan portfolio as of December 31, 2021 was $1.4 billion. The PPP loan forgiveness in the fourth quarter of 2021 was $111 million, down from $338 million in the third quarter of 2021. Net fees for PPP loans were $3.6 million in the fourth quarter of 2021, down from the $7.9 million in the third quarter of 2021. Remaining PPP loans totaled $157 million as of December 31, 2021 with $4.2 million of net fees to amortize over the remaining life of the loans. The weighted average rate on the $3.4 billion of new production for the fourth quarter of 2021 decreased to 3.89% from 4.24% in the third quarter of 2021 due primarily to the loan mix (higher levels of single-family loan pool purchases and equity fund loans). In the fourth quarter of 2021, we purchased $1.1 billion in single-family loan pools compared to $1.0 billion in the third quarter of 2021. The total of the single-family loan pool purchase portfolio as of December 31, 2021 was $2.3 billion.

The following table presents the composition of loans and leases held for investment by loan portfolio segment and class, net of deferred fees, as of the dates indicated:

December 31, 2021 September 30, 2021 December 31, 2020 % of % of % ofLoan andLease Balance Total Balance Total Balance TotalPortfolio (In thousands)Real estate mortgage:Commercial $ 3,762,299 17 % $ 3,694,597 18 % $ 4,096,671 21 %Incomeproducing 7,416,421 32 % 6,153,662 30 % 3,803,265 20 %and otherresidentialTotal realestate 11,178,720 49 % 9,848,259 48 % 7,899,936 41 %mortgageReal estateconstruction and land:Commercial 832,591 4 % 992,003 5 % 1,117,121 6 %Residential 2,604,536 11 % 2,392,568 12 % 2,243,160 12 %Total realestate 3,437,127 15 % 3,384,571 17 % 3,360,281 18 %constructionand landTotal real 14,615,847 64 % 13,232,830 65 % 11,260,217 59 %estateCommercial: Asset-based 4,075,477 18 % 3,661,769 18 % 3,429,283 18 %Venture 2,320,593 10 % 1,632,861 8 % 1,698,508 9 %capitalOther 1,471,981 6 % 1,577,592 7 % 2,375,114 12 %commercialTotal 7,868,051 34 % 6,872,222 33 % 7,502,905 39 %commercialConsumer 457,650 2 % 405,968 2 % 320,255 2 %Total loansand leasesheld forinvestment, $ 22,941,548 100 % $ 20,511,020 100 % $ 19,083,377 100 %net ofdeferredfees Totalunfunded $ 9,006,350 $ 8,480,599 $ 7,601,390 loancommitments

ALLOWANCE FOR CREDIT LOSSES

The following tables present roll forwards of the allowance for credit losses for the periods indicated:

Three Months Ended December 31, 2021 Allowance for Reserve for TotalAllowance for Credit Loan and Unfunded Loan Allowance forLosses Rollforward Lease Losses Commitments Credit Losses (In thousands)Beginning balance $ 203,733 $ 76,071 $ 279,804 Charge-offs (4,395 ) - (4,395 )Recoveries 4,226 - 4,226 Net charge-offs (169 ) - (169 )Provision (3,000 ) (3,000 ) (6,000 )Ending balance $ 200,564 $ 73,071 $ 273,635 Three Months Ended September 30, 2021 Allowance for Reserve for TotalAllowance for Credit Loan and Unfunded Loan Allowance forLosses Rollforward Lease Losses Commitments Credit Losses (In thousands)Beginning balance $ 225,600 $ 74,571 $ 300,171 Charge-offs (1,516 ) - (1,516 )Recoveries 1,149 - 1,149 Net charge-offs (367 ) - (367 )Provision (21,500 ) 1,500 (20,000 )Ending balance $ 203,733 $ 76,071 $ 279,804

Allowance for Credit Year Ended December 31,Losses Rollforward 2021 2020 (In thousands)Beginning balance $ 433,752 $ 174,646 Cumulative effect of change in accounting - 7,327 principle - CECLBalance, January 1 433,752 181,973 Charge-offs (10,715 ) (93,589 )Recoveries 12,598 6,368 Net recoveries (charge-offs) 1,883 (87,221 )Provision (162,000 ) 339,000 Ending balance $ 273,635 $ 433,752

The following table presents allowance for credit losses information as of and for the dates and periods indicated:

December 31, September 30, IncreaseAllowance for Credit Losses 2021 2021 (Decrease) (Dollars in thousands)Allowance for loan and lease $ 200,564 $ 203,733 $ (3,169 )lossesReserve for unfunded loan 73,071 76,071 (3,000 )commitmentsAllowance for credit losses $ 273,635 $ 279,804 $ (6,169 ) Provision for credit losses $ (6,000 ) $ (20,000 ) $ 14,000 (for the quarter)Net charge-offs (recoveries) $ 169 $ 367 $ (198 )(for the quarter)Net charge-offs (recoveries)to average loansand 0.00 % 0.01 % leases (for the quarter)Allowance for loan and leaselosses to loans and leases 0.87 % 0.99 % held for investmentAllowance for loan and leaselosses to loans and leases 0.88 % 1.01 % held for investment,excluding PPP loansAllowance for credit lossesto loans and leases held for 1.19 % 1.36 % investmentAllowance for credit lossesto loans and leases held for 1.20 % 1.38 % investment, excluding PPPloans

The allowance for credit losses decreased by $6.2 million in the fourth quarter of 2021 to $273.6 million at December 31, 2021. The decrease in the allowance for credit losses during the fourth quarter of 2021 was attributable to a provision for credit losses benefit of $6.0 million and $0.2 million in net charge-offs. The allowance for credit losses ratio, excluding PPP loans, of 1.20% remains robust and moderately higher than the pre-pandemic level of 0.97% as of the January 1, 2020 CECL adoption date.

Net charge-offs were $0.2 million for the fourth quarter of 2021 as gross charge-offs of $4.4 million were reduced by recoveries of $4.2 million.

Net charge-offs were $0.4 million for the third quarter of 2021 as gross charge-offs of $1.5 million were reduced by recoveries of $1.1 million.

On a year-to-date basis for the year ended December 31, 2021, net recoveries were $1.9 million as gross charge-offs of $10.7 million were reduced by recoveries of $12.6 million.

CREDIT QUALITY

The following table presents loan and lease credit quality metrics as of the dates indicated:

December 31, September 30, IncreaseCredit Quality 2021 2021 (Decrease)Metrics (Dollars in thousands)NPAs and Performing TDRs:Nonaccrual loans andleases held for $ 61,174 $ 64,507 $ (3,333 )investment (1)Accruing loanscontractually past - - - due 90 days or moreForeclosed assets, 12,843 13,364 (521 )netTotal nonperforming $ 74,017 $ 77,871 $ (3,854 )assets ("NPAs") Performing TDRs held $ 24,430 $ 36,750 $ (12,320 )for investment Nonaccrual loans andleases held forinvestment to loans 0.27 % 0.31 % and leases held forinvestmentNonperforming assetsto loans and leasesheld for investment 0.32 % 0.38 % and foreclosedassetsAllowance for creditlosses to nonaccrual 447.3 % 433.8 % loans and leasesheld for investment Loan and Lease Credit Risk Ratings:Pass $ 22,433,833 $ 19,873,050 $ 2,560,783 Special mention 391,611 496,366 (104,755 )Classified 116,104 141,604 (25,500 )Total loans andleases held for $ 22,941,548 $ 20,511,020 $ 2,430,528 investment, net ofdeferred fees Classified loans andleases held forinvestment to loans 0.51 % 0.69 % and leases held forinvestment (1) Nonaccrual loans include SBA guaranteed amounts of $22.1 million atDecember 31, 2021 and $20.1 millionat September 30, 2021.

Since downgrading certain loans at the onset of the pandemic in the first quarter of 2020 given all the uncertainty at the time, special mention loans and leases have decreased by $507.0 million or 56% from their peak in the first quarter of 2020, while classified loans and leases have decreased by $177.1 million or 60% from their peak in the second quarter of 2020, and each have significantly declined in the fourth quarter of 2021. Classified loans and leases are now below pre-pandemic levels while special mention loans and leases are also approaching pre-pandemic levels. Nonaccrual loans and leases decreased by $3.3 million to $61.2 million in the fourth quarter of 2021 due primarily to a decrease in nonaccrual short-term, single-family residential renovation loans as a result of payoffs during the quarter.

The following table presents nonaccrual loans and leases and accruing loans and leases past due between 30 and 89 days by loan portfolio segment and class as of the dates indicated:

December 31, 2021 September 30, 2021 Increase (Decrease) Accruing Accruing Accruing and 30-89 and 30-89 and 30-89 Days Past Days Past Days Past Nonaccrual Due Nonaccrual Due Nonaccrual Due (Dollars in thousands)Real estate mortgage:Commercial $ 27,540 $ 2,165 $ 25,615 $ 676 $ 1,925 $ 1,489 Incomeproducing and 12,292 39,929 7,547 3,760 4,745 36,169 otherresidentialTotal realestate 39,832 42,094 33,162 4,436 6,670 37,658 mortgageReal estateconstruction and land:Commercial - - - - - - Residential 4,715 5,031 19,918 12,809 (15,203 ) (7,778 )Total realestate 4,715 5,031 19,918 12,809 (15,203 ) (7,778 )constructionand landCommercial: Asset-based 1,464 - 1,605 - (141 ) - Venture 2,799 - 2,348 1,670 451 (1,670 )capitalOther 11,950 630 6,979 340 4,971 290 commercialTotal 16,213 630 10,932 2,010 5,281 (1,380 )commercialConsumer 414 1,004 495 1,042 (81 ) (38 )Total held for $ 61,174 $ 48,759 $ 64,507 $ 20,297 $ (3,333 ) $ 28,462 investment

The increase in accruing and 30-89 days past due loans is primarily due to $19.3 million in past due purchased single-family loans. As of January 14, 2022, $5.9 million of these loans remained over 30 days past due. The delinquency related to these loans was attributable to delayed payment application stemming from servicing being transferred following our purchase of the loans. The increase in this category was also due to an increase of $9.1 million in single-family residential loans originated by Civic.

CAPITAL

The following table presents certain actual capital ratios and ratios excluding PPP loans:

December 31, 2021 Excluding September 30, PPP 2021 Actual (1) Loans (1) ActualPacWest Bancorp Consolidated:Tier 1 leverage 6.84 % 6.88 % (3) 8.05 %capital ratioCommon equity tier 8.86 % 8.86 % 10.15 %1 capital ratioTier 1 capital 9.32 % 9.32 % 10.65 %ratioTotal capital 12.69 % 12.69 % 14.36 %ratioRisk-weighted $ 28,508,808 $ 28,508,808 $ 26,057,583 assetsTangible common 6.54 % 6.56 % (3) 7.79 %equity ratio (2) (1) Capital information for December 31, 2021 is preliminary.(2) Non-GAAP measure.(3) PPP loans have been excluded from total assets in the denominator as theyare zero risk-weighted.

The decreases in the capital ratios during the fourth quarter of 2021 were due primarily to the increase in goodwill related to the HOA acquisition combined with an increase in risk-weighted assets as we deployed $3.8 billion of excess liquidity into securities and loans and leases during the quarter.

ABOUT PACWEST BANCORP

PacWest Bancorp (PacWest) is a bank holding company with over $40 billion in assets headquartered in Los Angeles, California, with an executive office in Denver, Colorado, with one wholly-owned banking subsidiary, Pacific Western Bank (the Bank). The Bank has 69 full-service branches located in California, one branch located in Durham, North Carolina, and one branch located in Denver, Colorado. The Bank provides community banking products including lending and comprehensive deposit and treasury management services to small and medium-sized businesses conducted primarily through our California-based branch offices and Denver, Colorado branch office. The Bank offers national lending products including asset-based, equipment, and real estate loans and treasury management services to established middle-market businesses on a national basis. The Bank provides venture banking products including a comprehensive suite of financial services focused on entrepreneurial and venture-backed businesses and their venture capital and private equity investors, with offices located in key innovative hubs across the United States. The Bank also offers financing of non-owner-occupied investor properties through Civic Financial Services a wholly-owned subsidiary. The Bank also offers a specialized suite of services for the HOA industry. For more information about PacWest Bancorp or Pacific Western Bank, visit www.pacwest.com.

FORWARD LOOKING STATEMENTS

This communication contains certain forward-looking information about PacWest that is intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements about future financial and operational results, expectations, or intentions are forward-looking statements. Such statements are based on information available at the time of the communication and are based on current beliefs and expectations of the Companys management and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control. The ongoing COVID-19 pandemic has adversely affected PacWest, its employees, customers and third-party service providers, and the ultimate extent of the impacts on its business, financial position, results of operations, liquidity and prospects is uncertain. The risks from the COVID-19 pandemic have decreased as the pandemic subsides, however, new variants may continue to impact key macro-economic indicators such as unemployment and GDP and may have a material impact on our allowance for credit losses and related provision for credit losses. Continued deterioration in general business and economic conditions could adversely affect PacWests revenues and the values of its assets, including goodwill, and liabilities, lead to a tightening of credit, and increase stock price volatility. In addition, PacWests results could be adversely affected by changes in interest rates, sustained high unemployment rates, deterioration in the credit quality of its loan portfolio or in the value of the collateral securing those loans, deterioration in the value of its investment securities, the magnitude of individual loan losses on security monitoring loans, and legal and regulatory developments. Actual results may differ materially from those set forth or implied in the forward-looking statements due to a variety of factors, including the risk factors described in documents filed by PacWest with the U.S. Securities and Exchange Commission.

We are under no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

PACWEST BANCORP AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEET December 31, September 30, December 31, 2021 2021 2020 (Dollars in thousands, except per share data)ASSETS: Cash and due from banks $ 112,548 $ 174,585 $ 150,464 Interest-earning deposits 3,944,686 3,524,613 3,010,197 in financial institutionsTotal cash and cash 4,057,234 3,699,198 3,160,661 equivalents Securitiesavailable-for-sale, at 10,694,458 9,276,926 5,235,591 estimated fair valueFederal Home Loan Bank 17,250 17,250 17,250 stock, at costTotal investment 10,711,708 9,294,176 5,252,841 securities Loans held for sale - - - Gross loans and leases 23,026,308 20,588,255 19,153,357 held for investmentDeferred fees, net (84,760 ) (77,235 ) (69,980 )Total loans and leasesheld for investment, net 22,941,548 20,511,020 19,083,377 of deferred feesAllowance for loan and (200,564 ) (203,733 ) (348,181 )lease lossesTotal loans and leases 22,740,984 20,307,287 18,735,196 held for investment, net Equipment leased toothers under operating 339,150 334,275 333,846 leasesPremises and equipment, 46,740 47,246 39,234 netForeclosed assets, net 12,843 13,364 14,027 Goodwill 1,405,736 1,204,118 1,078,670 Core deposit and customerrelationship intangibles, 44,957 15,533 23,641 netOther assets 1,083,992 970,479 860,326 Total assets $ 40,443,344 $ 35,885,676 $ 29,498,442 LIABILITIES: Noninterest-bearing $ 14,543,133 $ 12,881,806 $ 9,193,827 depositsInterest-bearing deposits 20,454,624 17,677,939 15,746,890 Total deposits 34,997,757 30,559,745 24,940,717 Borrowings - - 5,000 Subordinated debt 863,283 862,447 465,812 Accrued interest payable 582,674 545,050 491,962 and other liabilitiesTotal liabilities 36,443,714 31,967,242 25,903,491 STOCKHOLDERS' EQUITY (1) 3,999,630 3,918,434 3,594,951 Total liabilities and $ 40,443,344 $ 35,885,676 $ 29,498,442 stockholders? equity Book value per share $ 33.45 $ 32.77 $ 30.36 Tangible book value per $ 21.31 $ 22.57 $ 21.05 share (2)Shares outstanding 119,584,854 119,579,566 118,414,853 (1) Includes netunrealized gain on $ 65,968 $ 98,859 $ 172,523 securitiesavailable-for-sale, net(2) Non-GAAP measure.



PACWEST BANCORP AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENT OF EARNINGS (LOSS) Three Months Ended Year Ended December 31, September 30, December 31, December 31, 2021 2021 2020 2021 2020 (Dollars in thousands, except per share data)Interest income:Loans and $ 263,662 $ 246,722 $ 242,198 $ 996,457 $ 993,138 leasesInvestment 48,469 40,780 28,843 153,468 106,770 securitiesDeposits infinancial 2,674 2,580 1,135 8,804 3,583 institutionsTotal interest 314,805 290,082 272,176 1,158,729 1,103,491 income Interest expense:Deposits 6,622 6,417 8,454 27,808 59,663 Borrowings 64 101 37 623 8,161 Subordinated 7,714 7,722 4,477 26,474 21,109 debtTotal interest 14,400 14,240 12,968 54,905 88,933 expense Net interest 300,405 275,842 259,208 1,103,824 1,014,558 incomeProvision for (6,000 ) (20,000 ) 10,000 (162,000 ) 339,000 credit lossesNet interestincome after 306,405 295,842 249,208 1,265,824 675,558 provision forcredit losses Noninterest income:Servicecharges on 3,476 3,407 3,119 13,269 10,351 depositaccountsOthercommissions 10,633 11,792 9,974 42,287 40,347 and feesLeasedequipment 12,602 10,943 9,440 45,746 43,628 incomeGain on saleof loans and 172 - 1,671 1,733 2,139 leasesGain on sale 999 515 4 1,615 13,171 of securitiesOther income 29,500 24,688 15,642 89,277 36,424 Totalnoninterest 57,382 51,345 39,850 193,927 146,060 income Noninterest expense:Compensation 99,700 98,061 73,171 368,450 271,494 Occupancy 14,656 14,928 14,083 58,422 57,555 Data 8,171 7,391 6,718 30,277 26,779 processingOtherprofessional 5,946 5,164 6,800 21,492 19,917 servicesInsurance and 5,032 3,685 5,064 17,365 22,625 assessmentsIntangibleasset 3,876 2,890 3,172 12,734 14,753 amortizationLeasedequipment 9,569 8,603 7,501 35,755 28,865 depreciationForeclosedassets (260 ) 165 (272 ) (213 ) (17 )(income)expense, netAcquisition,integrationand 5,590 200 1,060 9,415 1,060 reorganizationcostsCustomerrelated 6,175 4,538 4,430 20,504 17,532 expenseLoan expense 5,627 4,180 3,926 17,031 13,454 Goodwill - - - - 1,470,000 impairmentOther expense 12,028 9,616 10,029 46,185 40,002 Totalnoninterest 176,110 159,421 135,682 637,417 1,984,019 expense Earnings(loss) before 187,677 187,766 153,376 822,334 (1,162,401 )income taxesIncome tax 51,632 47,770 36,546 215,375 75,173 expenseNet earnings $ 136,045 $ 139,996 $ 116,830 $ 606,959 $ (1,237,574 )(loss) Basic anddilutedearnings $ 1.14 $ 1.17 $ 0.99 $ 5.10 $ (10.61 )(loss) pershareDividendsdeclared and $ 0.25 $ 0.25 $ 0.25 $ 1.00 $ 1.35 paid per share



PACWESTBANCORP AND SUBSIDIARIESNET EARNINGS (LOSS) PER SHARE CALCULATIONS Three Months Ended December 31, September 30, December 31, December 31, 2021 2021 2020 2021 2020 (In thousands, except per share data)BasicEarnings (Loss) PerShare:Net earnings $ 136,045 $ 139,996 $ 116,830 $ 606,959 $ (1,237,574 )(loss)Less:earningsallocated to (2,311 ) (2,417 ) (1,398 ) (10,248 ) (1,782 )unvestedrestrictedstock (1)Net earnings(loss)allocated to $ 133,734 $ 137,579 $ 115,432 $ 596,711 $ (1,239,356 )commonshares Weightedaveragebasic sharesand unvested 119,577 119,569 118,446 119,349 118,463 restrictedstockoutstandingLess:weightedaverageunvested (2,314 ) (2,340 ) (1,652 ) (2,255 ) (1,610 )restrictedstockoutstandingWeightedaverage 117,263 117,229 116,794 117,094 116,853 basic sharesoutstanding Basicearnings $ 1.14 $ 1.17 $ 0.99 $ 5.10 $ (10.61 )(loss) pershare DilutedEarnings (Loss) PerShare:Net earnings(loss)allocated to $ 133,734 $ 137,579 $ 115,432 $ 596,711 $ (1,239,356 )commonshares Weightedaveragediluted 117,263 117,229 116,794 117,094 116,853 sharesoutstanding Dilutedearnings $ 1.14 $ 1.17 $ 0.99 $ 5.10 $ (10.61 )(loss) pershare (1) Represents cash dividends paid to holders of unvested stock, net offorfeitures, plus undistributed earnings amounts available to holders ofunvested restricted stock, if any.



PACWEST BANCORP AND SUBSIDIARIES AVERAGE BALANCE SHEET AND YIELD ANALYSIS Three Months Ended December 31, 2021 September 30, 2021 December 31, 2020 Interest Average Interest Average Interest Average Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/ Balance Expense Cost Balance Expense Cost Balance Expense Cost (Dollars in thousands)Assets: Loans and leases (1) $ 21,367,665 $ 265,549 4.93 % $ 19,670,671 $ 248,485 5.01 % $ 18,769,214 $ 243,188 5.15 %(2)Investment securities 9,964,568 50,710 2.02 % 8,047,098 42,952 2.12 % 4,888,993 30,757 2.50 %(3)Deposits in financial 5,961,104 2,674 0.18 % 5,657,768 2,580 0.18 % 3,576,335 1,135 0.13 %institutionsTotalinterest-earning 37,293,337 318,933 3.39 % 33,375,537 294,017 3.50 % 27,234,542 275,080 4.02 %assets (1)Other assets 3,064,810 2,496,127 2,100,247 Total assets $ 40,358,147 $ 35,871,664 $ 29,334,789 Liabilities andStockholders' Equity:Interest checking $ 7,767,211 2,041 0.10 % $ 7,372,859 2,042 0.11 % $ 5,191,435 2,064 0.16 %Money market 10,226,366 3,400 0.13 % 8,662,449 2,997 0.14 % 7,636,220 3,225 0.17 %Savings 634,874 39 0.02 % 620,079 38 0.02 % 567,646 35 0.02 %Time 1,421,859 1,142 0.32 % 1,475,307 1,340 0.36 % 1,650,150 3,130 0.75 %Totalinterest-bearing 20,050,310 6,622 0.13 % 18,130,694 6,417 0.14 % 15,045,451 8,454 0.22 %depositsBorrowings 234,391 64 0.11 % 238,335 101 0.17 % 237,098 37 0.06 %Subordinated debt 862,777 7,714 3.55 % 862,272 7,722 3.55 % 463,951 4,477 3.84 %Totalinterest-bearing 21,147,478 14,400 0.27 % 19,231,301 14,240 0.29 % 15,746,500 12,968 0.33 %liabilitiesNoninterest-bearing 14,713,385 12,198,313 9,589,789 demand depositsOther liabilities 543,017 525,429 462,075 Total liabilities 36,403,880 31,955,043 25,798,364 Stockholders' equity 3,954,267 3,916,621 3,536,425 Total liabilities and $ 40,358,147 $ 35,871,664 $ 29,334,789 stockholders' equityNet interest income $ 304,533 $ 279,777 $ 262,112 (1)Net interest spread 3.12 % 3.21 % 3.69 %(1)Net interest margin 3.24 % 3.33 % 3.83 %(1) Total deposits (4) $ 34,763,695 $ 6,622 0.08 % $ 30,329,007 $ 6,417 0.08 % $ 24,635,240 $ 8,454 0.14 % (1) Tax equivalent.(2) Includes net loan premium amortization of $6.4 million and $2.4 million andnet loan discount accretion of $1.2 for the three monthsended December 31,2021, September 30, 2021, and December 31, 2020, respectively.(3) Includes tax-equivalent adjustments of $2.2 million, $2.2 million, and $1.9million for the three months ended December 31, 2021,September 30, 2021, andDecember 31, 2020 related to tax-exempt income on investment securitiesThefederal statutory tax rate utilized was 21%.(4) Total deposits is the sum of total interest-bearing deposits andnoninterest-bearing demand deposits. The cost of total deposits iscalculatedas annualized interest expense on total deposits divided by average totaldeposits.

PACWEST BANCORP AND SUBSIDIARIESFIVE QUARTER BALANCE SHEET December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 (Dollars in thousands, except per share data)ASSETS: Cash and due from $ 112,548 $ 174,585 $ 179,505 $ 177,199 $ 150,464 banksInterest-earningdeposits in 3,944,686 3,524,613 5,678,587 5,517,667 3,010,197 financialinstitutionsTotal cash and cash 4,057,234 3,699,198 5,858,092 5,694,866 3,160,661 equivalents Securities 10,694,458 9,276,926 7,198,608 5,941,690 5,235,591 available-for-saleFederal Home Loan 17,250 17,250 17,250 17,250 17,250 Bank stockTotal investment 10,711,708 9,294,176 7,215,858 5,958,940 5,252,841 securities Loans held for sale - - - 25,554 - Gross loans andleases held for 23,026,308 20,588,255 19,580,731 19,055,165 19,153,357 investmentDeferred fees, net (84,760 ) (77,235 ) (74,474 ) (75,937 ) (69,980 )Total loans andleases held for 22,941,548 20,511,020 19,506,257 18,979,228 19,083,377 investment, net ofdeferred feesAllowance for loan (200,564 ) (203,733 ) (225,600 ) (292,445 ) (348,181 )and lease lossesTotal loans andleases held for 22,740,984 20,307,287 19,280,657 18,686,783 18,735,196 investment, net Equipment leased toothers under 339,150 334,275 313,574 327,413 333,846 operating leasesPremises and 46,740 47,246 39,541 39,622 39,234 equipment, netForeclosed assets, 12,843 13,364 13,227 14,298 14,027 netGoodwill 1,405,736 1,204,118 1,204,118 1,204,092 1,078,670 Core deposit andcustomer 44,957 15,533 18,423 21,312 23,641 relationshipintangibles, netOther assets 1,083,992 970,479 924,497 883,653 860,326 Total assets $ 40,443,344 $ 35,885,676 $ 34,867,987 $ 32,856,533 $ 29,498,442 LIABILITIES: Noninterest-bearing $ 14,543,133 $ 12,881,806 $ 11,252,286 $ 11,017,462 $ 9,193,827 depositsInterest-bearing 20,454,624 17,677,939 18,394,748 17,205,829 15,746,890 depositsTotal deposits 34,997,757 30,559,745 29,647,034 28,223,291 24,940,717 Borrowings - - 6,625 19,750 5,000 Subordinated debt 863,283 862,447 861,788 465,814 465,812 Accrued interestpayable and other 582,674 545,050 505,859 493,541 491,962 liabilitiesTotal liabilities 36,443,714 31,967,242 31,021,306 29,202,396 25,903,491 STOCKHOLDERS' 3,999,630 3,918,434 3,846,681 3,654,137 3,594,951 EQUITY (1)Total liabilitiesand stockholders? $ 40,443,344 $ 35,885,676 $ 34,867,987 $ 32,856,533 $ 29,498,442 equity Book value per $ 33.45 $ 32.77 $ 32.17 $ 30.68 $ 30.36 shareTangible book value $ 21.31 $ 22.57 $ 21.95 $ 20.39 $ 21.05 per share (2)Shares outstanding 119,584,854 119,579,566 119,555,102 119,105,642 118,414,853 (1) Includes netunrealized gain onsecurities $ 65,968 $ 98,859 $ 145,516 $ 106,381 $ 172,523 available-for-sale,net(2) Non-GAAP measure.

PACWEST BANCORP AND SUBSIDIARIESFIVE QUARTER STATEMENT OF EARNINGS Three Months Ended December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 (Dollars in thousands, except per share data)Interest income:Loans and $ 263,662 $ 246,722 $ 244,529 $ 241,544 $ 242,198 leasesInvestment 48,469 40,780 33,954 30,265 28,843 securitiesDeposits infinancial 2,674 2,580 2,022 1,528 1,135 institutionsTotal interest 314,805 290,082 280,505 273,337 272,176 income Interest expense:Deposits 6,622 6,417 7,269 7,500 8,454 Borrowings 64 101 265 193 37 Subordinated 7,714 7,722 6,663 4,375 4,477 debtTotal interest 14,400 14,240 14,197 12,068 12,968 expense Net interest 300,405 275,842 266,308 261,269 259,208 incomeProvision for (6,000 ) (20,000 ) (88,000 ) (48,000 ) 10,000 credit lossesNet interestincome after 306,405 295,842 354,308 309,269 249,208 provision forcredit losses Noninterest income:Servicecharges on 3,476 3,407 3,452 2,934 3,119 depositaccountsOthercommissions 10,633 11,792 10,704 9,158 9,974 and feesLeasedequipment 12,602 10,943 10,847 11,354 9,440 incomeGain on saleof loans and 172 - 1,422 139 1,671 leasesGain on sale 999 515 - 101 4 of securitiesOther income 29,500 24,688 13,946 21,143 15,642 Totalnoninterest 57,382 51,345 40,371 44,829 39,850 income Noninterest expense:Compensation 99,700 98,061 90,807 79,882 73,171 Occupancy 14,656 14,928 14,784 14,054 14,083 Data 8,171 7,391 7,758 6,957 6,718 processingOtherprofessional 5,946 5,164 5,256 5,126 6,800 servicesInsurance and 5,032 3,685 3,745 4,903 5,064 assessmentsIntangibleasset 3,876 2,890 2,889 3,079 3,172 amortizationLeasedequipment 9,569 8,603 8,614 8,969 7,501 depreciationForeclosedassets (260 ) 165 (119 ) 1 (272 )(income)expense, netAcquisition,integrationand 5,590 200 200 3,425 1,060 reorganizationcostsCustomerrelated 6,175 4,538 4,973 4,818 4,430 expenseLoan expense 5,627 4,180 4,031 3,193 3,926 Other expense 12,028 9,616 8,812 15,729 10,029 Totalnoninterest 176,110 159,421 151,750 150,136 135,682 expense Earningsbefore income 187,677 187,766 242,929 203,962 153,376 taxesIncome tax 51,632 47,770 62,417 53,556 36,546 expenseNet earnings $ 136,045 $ 139,996 $ 180,512 $ 150,406 $ 116,830 Basic anddiluted $ 1.14 $ 1.17 $ 1.52 $ 1.27 $ 0.99 earnings pershareDividendsdeclared and $ 0.25 $ 0.25 $ 0.25 $ 0.25 $ 0.25 paid per share

PACWEST BANCORP AND SUBSIDIARIESFIVE QUARTER SELECTED FINANCIAL DATA At or For the Three Months Ended December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 (Dollars in thousands)Performance Ratios: Return on average 1.34 % 1.55 % 2.11 % 1.94 % 1.58 %assets (1)Pre-provision,pre-goodwillimpairment, pre-taxnet revenue 1.79 % 1.86 % 1.81 % 2.01 % 2.22 %("PPNR") return onaverage assets (1)(2)Return on average 13.65 % 14.18 % 19.36 % 16.86 % 13.14 %equity (1)Return on averagetangible equity (1) 22.06 % 21.03 % 29.25 % 25.67 % 19.63 %(2)Efficiency ratio 46.2 % 47.2 % 47.9 % 46.4 % 43.6 %Noninterest expenseas a percentage of 1.73 % 1.76 % 1.77 % 1.94 % 1.84 %average assets (1) Average Yields/ Costs (1):Yield on: Average loans and 4.93 % 5.01 % 5.18 % 5.20 % 5.15 %leases (3)Average investment 2.02 % 2.12 % 2.23 % 2.44 % 2.50 %securities (3)Averageinterest-earning 3.39 % 3.50 % 3.57 % 3.86 % 4.02 %assets (3)Cost of: Averageinterest-bearing 0.13 % 0.14 % 0.16 % 0.18 % 0.22 %depositsAverage total 0.08 % 0.08 % 0.10 % 0.11 % 0.14 %depositsAverageinterest-bearing 0.27 % 0.29 % 0.30 % 0.29 % 0.33 %liabilitiesNet interest spread 3.12 % 3.21 % 3.27 % 3.57 % 3.69 %(3)Net interest margin 3.24 % 3.33 % 3.40 % 3.69 % 3.83 %(3) Average Balances: Assets: Loans and leases,net of deferred $ 21,367,665 $ 19,670,671 $ 19,057,420 $ 18,927,314 $ 18,769,214 feesInvestment 9,964,568 8,047,098 6,492,721 5,383,140 4,888,993 securitiesDeposits infinancial 5,961,104 5,657,768 6,347,764 4,790,231 3,576,335 institutionsInterest-earning 37,293,337 33,375,537 31,897,905 29,100,685 27,234,542 assetsTotal assets 40,358,147 35,871,664 34,326,112 31,415,882 29,334,789 Liabilities: Noninterest-bearing 14,713,385 12,198,313 11,304,757 10,173,459 9,589,789 depositsInterest-bearing 20,050,310 18,130,694 17,817,053 16,044,091 15,045,451 depositsTotal deposits 34,763,695 30,329,007 29,121,810 26,217,550 24,635,240 Borrowings 234,391 238,335 225,446 226,053 237,098 Subordinated debt 862,777 862,272 735,725 466,101 463,951 Interest-bearing 21,147,478 19,231,301 18,778,224 17,136,245 15,746,500 liabilitiesStockholders' 3,954,267 3,916,621 3,739,042 3,617,248 3,536,425 equity (1) Annualized.(2) Non-GAAP measure.(3) Tax equivalent.

PACWEST BANCORP AND SUBSIDIARIESFIVE QUARTER SELECTED FINANCIAL DATA At or For the Three Months Ended December 31, September 30, June 30, March 31, December 31, 2021 2021 2021 2021 2020 (Dollars in thousands)CreditQuality Ratios:Nonaccrualloans andleases heldforinvestment to 0.27 % 0.31 % 0.29 % 0.36 % 0.48 %loans andleases heldforinvestmentNonperformingassets toloans andleases heldfor 0.32 % 0.38 % 0.36 % 0.43 % 0.55 %investmentandforeclosedassetsClassifiedloans andleases heldforinvestment to 0.51 % 0.69 % 0.75 % 0.86 % 1.39 %loans andleases heldforinvestmentProvision forcredit losses(for thequarter) toaverage loans (0.11 )% (0.40 )% (1.85 )% (1.03 )% 0.21 %and leasesheld forinvestment(annualized)Netcharge-offs(for thequarter) toaverage loans 0.00 % 0.01 % (0.11 )% 0.06 % 0.40 %and leasesheld forinvestment(annualized)Trailing 12months netcharge-offsto average (0.01 )% 0.09 % 0.27 % 0.37 % 0.45 %loans andleases heldforinvestmentAllowance forloan andlease lossesto loans and 0.87 % 0.99 % 1.16 % 1.54 % 1.82 %leases heldforinvestmentAllowance forcredit lossesto loans and 1.19 % 1.36 % 1.54 % 2.02 % 2.27 %leases heldforinvestmentAllowance forcredit lossesto nonaccrualloans and 447.3 % 433.8 % 528.4 % 566.2 % 475.8 %leases heldforinvestment PacWestBancorp Consolidated:Tier 1leverage 6.84 % 8.05 % 7.67 % 7.95 % 8.55 %capital ratio(1)Common equitytier 1 8.86 % 10.15 % 10.41 % 10.39 % 10.53 %capital ratio(1)Tier 1capital ratio 9.32 % 10.65 % 10.41 % 10.39 % 10.53 %(1)Total capital 12.69 % 14.36 % 14.99 % 13.60 % 13.76 %ratio (1)Risk-weighted $ 28,508,808 $ 26,057,583 $ 24,274,256 $ 23,012,350 $ 22,837,693 assets (1) Equity to 9.89 % 10.92 % 11.03 % 11.12 % 12.19 %assets ratioTangiblecommon equity 6.54 % 7.79 % 7.80 % 7.68 % 8.78 %ratio (2)Book value $ 33.45 $ 32.77 $ 32.17 $ 30.68 $ 30.36 per shareTangible bookvalue per $ 21.31 $ 22.57 $ 21.95 $ 20.39 $ 21.05 share (2) Pacific Western Bank:Tier 1leverage 7.00 % 8.40 % 8.47 % 8.83 % 9.53 %capital ratio(1)Common equitytier 1 9.56 % 11.12 % 11.51 % 11.54 % 11.73 %capital ratio(1)Tier 1capital ratio 9.56 % 11.12 % 11.51 % 11.54 % 11.73 %(1)Total capital 11.80 % 13.59 % 14.22 % 12.80 % 12.99 %ratio (1) (1) Capital information for December 31, 2021 is preliminary.(2) Non-GAAP measure.

GAAP TO NON-GAAP RECONCILIATIONS

This press release contains certain non-GAAP financial disclosures for: (1) Pre-provision, pre-goodwill impairment, pre-tax net revenue (PPNR), (2) PPNR return on average assets (3) return on average tangible equity, (4) tangible common equity ratio, and (5) tangible book value per share. The Company uses these non-GAAP financial measures to provide meaningful supplemental information regarding the Companys operational performance and to enhance investors overall understanding of such financial performance. In particular, the use of return on average tangible equity, tangible common equity ratio, tangible book value per share, and PPNR is prevalent among banking regulators, investors, and analysts. Accordingly, we disclose the non-GAAP measures in addition to the related GAAP measures of: (1) net earnings, (2) return on average assets, (3) return on average equity, (4) equity to assets ratio, and (5) book value per share.

The tables below present the reconciliations of these GAAP financial measures to the related non-GAAP financial measures:

Three Months Ended Year EndedPPNR and PPNR December 31, September 30, December 31, December 31,Returnon Average 2021 2021 2020 2021 2020 Assets (Dollars in thousands)Net earnings $ 136,045 $ 139,996 $ 116,830 $ 606,959 $ (1,237,574 )(loss)Add: Provisionfor credit (6,000 ) (20,000 ) 10,000 (162,000 ) 339,000 lossesAdd: Goodwill - - - - 1,470,000 impairmentAdd: Income 51,632 47,770 36,546 215,375 75,173 tax expensePre-provision,pre-goodwillimpairment, $ 181,677 $ 167,766 $ 163,376 $ 660,334 $ 646,599 pre-tax netrevenue("PPNR") Average assets $ 40,358,147 $ 35,871,664 $ 29,334,789 $ 35,518,488 $ 27,752,412 Return onaverage assets 1.34 % 1.55 % 1.58 % 1.71 % (4.46 )%(1)PPNR return onaverage assets 1.79 % 1.86 % 2.22 % 1.86 % 2.33 %(2) (1) Annualized net earnings (loss) divided by average assets.(2) Annualized PPNR divided by average assets.

Three Months Ended Year Ended December 31, September 30, December 31, December 31,Return onAverage 2021 2021 2020 2021 2020 TangibleEquity (Dollars in thousands)Net earnings $ 136,045 $ 139,996 $ 116,830 $ 606,959 $ (1,237,574 )(loss)Add:Intangible 3,876 2,890 3,172 12,734 14,753 assetamortizationAdd: Goodwill - - - - 1,470,000 impairmentAdjusted net $ 139,921 $ 142,886 $ 120,002 $ 619,693 $ 247,179 earnings Averagestockholders' $ 3,954,267 $ 3,916,621 $ 3,536,425 $ 3,808,019 $ 3,857,610 equityLess: Averageintangible 1,437,780 1,221,253 1,103,945 1,269,546 1,470,989 assetsAveragetangible $ 2,516,487 $ 2,695,368 $ 2,432,480 $ 2,538,473 $ 2,386,621 common equity Return onaverage equity 13.65 % 14.18 % 13.14 % 15.94 % (32.08 )%(1)Return onaverage 22.06 % 21.03 % 19.63 % 24.41 % 10.36 %tangibleequity (2) (1) Annualized net earnings divided by average stockholders' equity.(2) Annualized adjusted net earnings divided by average tangible common equity.

Tangible Common December 31, September 30, June 30, March 31, December 31,Equity Ratio/Tangible Book 2021 2021 2021 2021 2020 Value Per Share (Dollars in thousands, except per share data)Stockholders' $ 3,999,630 $ 3,918,434 $ 3,846,681 $ 3,654,137 $ 3,594,951 equityLess:Intangible 1,450,693 1,219,651 1,222,541 1,225,404 1,102,311 assetsTangible common $ 2,548,937 $ 2,698,783 $ 2,624,140 $ 2,428,733 $ 2,492,640 equity Total assets $ 40,443,344 $ 35,885,676 $ 34,867,987 $ 32,856,533 $ 29,498,442 Less:Intangible 1,450,693 1,219,651 1,222,541 1,225,404 1,102,311 assetsTangible assets $ 38,992,651 $ 34,666,025 $ 33,645,446 $ 31,631,129 $ 28,396,131 Equity to 9.89 % 10.92 % 11.03 % 11.12 % 12.19 %assets ratioTangible commonequity ratio 6.54 % 7.79 % 7.80 % 7.68 % 8.78 %(1) Book value per $ 33.45 $ 32.77 $ 32.17 $ 30.68 $ 30.36 shareTangible bookvalue per share $ 21.31 $ 22.57 $ 21.95 $ 20.39 $ 21.05 (2)Shares 119,584,854 119,579,566 119,555,102 119,105,642 118,414,853 outstanding (1) Tangible common equity divided by tangible assets.(2) Tangible common equity divided by shares outstanding.

CONTACTS

Matthew P. Wagner Bart R. Olson William J. BlackPresident and CEO EVP and CFO EVP Strategy and Corporate Development303.802.8900 714.989.4149 919.597.7466