California BanCorp, a California corporation headquartered in Del Mar, has recently completed a reorganization, with California Bank of Commerce, N.A. becoming its wholly-owned subsidiary. The bank offers a range of financial products and services to individuals, professionals, and small* to medium-sized businesses through its 14 branch offices serving California.
On July 31, 2024, the company completed an all-stock merger with California BanCorp ("CALB"), resulting in the expansion of its footprint into Northern California. The merger brought total loans of $1.43 billion, total assets of $1.91 billion, and total deposits of $1.64 billion. The merger aimed to build scale and increase market share through complementary business models with a strong deposit base.
The bank has been actively involved in providing assistance to clients and employees affected by the Southern California wildfires, which destroyed an estimated 12,000 structures. The bank has donated money to relief funds and provided volunteer assistance to those affected. The impact of the fires on the loan portfolio is expected to be minimal.
In terms of the economy, the Federal Reserve's interest rate adjustments have been closely monitored. The Federal Reserve raised interest rates 11 times between March 2022 and September 2023, by an aggregate of 525 basis points, reaching the highest level in 22 years. However, in 2024, the Federal Reserve reduced the federal funds interest rate by 100 basis points, ending the year in a range of 4.25% to 4.50%. Concerns regarding a potential recession have moderated, with the U.S. GDP reported at 2.8% for the full year 2024.
The bank's consolidated balance sheet is strong, with diversified deposit and loan portfolios and very little sector or individual customer concentration. At March 31, 2025, the bank's concentration of commercial real estate loans represented 439% of its total risk-based capital. The non-performing loans for these segments were $16.4 million, with $1.7 million in charge-offs during the three months ended March 31, 2025.
The bank has also provided financial highlights for the three months ended March 31, 2025, including a net interest income of $42,255, noninterest income of $2,566, and a net income of $16,853. The bank's return on average assets was 1.71%, and its tangible equity to tangible assets ratio was 10.34%.
The company has also disclosed certain non-GAAP financial measures, which it believes provide useful information to assess its consolidated financial condition and results of operations. These measures complement its GAAP reporting and are presented to provide investors and others with additional information. Following these announcements, the company's shares moved 1.59%, and are now trading at a price of $14.73. For the full picture, make sure to review California BanCorp \ CA's 10-Q report.
