Yahoo Finance PacWest Bancorp Announces the Evolution of Its Business Strategy
LOS ANGELES, Jan. 26, 2023 (GLOBE NEWSWIRE) -- PacWest Bancorp (Nasdaq: PACW) (the “Company”) today announced a new strategic plan with a mission to maximize shareholder value by exceeding customer expectations. This plan focuses on strengthening our community bank businesses, exiting non-core products and services, and improving our operational efficiency.
Specifically, the Company made the decision to wind down operations in our Premium Finance and Multi-Family lending groups in the fourth quarter of 2022. In addition, the Company is restructuring Civic, a lending subsidiary, to improve its profitability and risk profile. Further, the Company opportunistically sold $1 billion of available-for-sale securities at a loss in the fourth quarter of 2022 and used the proceeds to pay down FHLB borrowings. These actions align with our strategy to focus on relationship-based community banking and to improve capital, liquidity, and operational efficiency.
Paul W. Taylor, President and CEO, said, “We see opportunity for growth in earnings through focusing on our core businesses and customers. Our plan is to build on the strengths of our deposit-focused relationship-based community bank businesses, operating as One Team. PacWest has a long history of acquisitions that brought us great customers, talented employees but also varied processes and different cultures. We are operating with a sense of urgency and believe the time is right to focus on coming together to function more uniformly and efficiently as One Team, regardless of business line or corporate function.”
Mr. Taylor added, “We are focused on specific financial performance metrics that we believe are achievable and where the Bank should perform over time.”
Our One Team Goals for 2023 are:
Build capital to CET1 10%+
Low cost core deposits equal to 40% of portfolio
Return on Assets (ROA) of 1.50%
Efficiency Ratio of 45%
Nonperforming Asset Ratio less than 50 bps
Top quartile Earnings Per Share (EPS) growth
“We are committed to simplifying and improving our processes to deliver an even higher level of service to our customers and more value to our shareholders while meeting or exceeding our regulators' requirements for safety and soundness. There are real challenges ahead with rising interest rates and a slowing economy. But there is also a significant opportunity for PacWest to improve our performance and return to shareholders given our strong team, a great customer base, and a plan to unlock additional value for our shareholders and employees,” Mr. Taylor said.
ABOUT PACWEST BANCORP
PacWest Bancorp (“PacWest”) is a bank holding company with over $41 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”). Pacific Western Bank is a relationship-based community bank focused on providing business banking and treasury management services to small, middle-market, and venture-backed businesses. The Bank offers a broad range of loan and lease and deposit products and services through full-service branches throughout California and in Durham, North Carolina and Denver, Colorado, and loan production offices around the country. For more information about PacWest Bancorp or Pacific Western Bank, visit www.pacwest.com.
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