Banc of California Signals Strength with Buyback and Debt Takedown

LOS ANGELES, CA – March 23, 2026 – Banc of California, Inc. (NYSE: BANC) has unveiled a decisive two-part capital management strategy, signaling strong confidence in its financial health and a commitment to enhancing shareholder value. The Los Angeles-based bank announced an extension of its substantial stock repurchase program and its intent to redeem nearly $400 million in higher-cost debt, moves that were met with approval from the market and underscore the bank's proactive stance following its transformative merger with PacWest Bancorp.

In a statement that reflects a dual focus on shareholder returns and balance sheet optimization, the bank's Board of Directors approved a one-year extension of its existing $300 million stock repurchase program through March 16, 2027. Simultaneously, the company declared its plan to redeem the entire $385 million principal amount of 3.25% Fixed-to-Floating Rate Subordinated Notes, a liability assumed during the PacWest acquisition.

These actions are not being viewed in isolation but as a cohesive strategy to fortify the bank's financial structure. "Extending our stock repurchase program enables us to continue returning excess capital to stockholders through disciplined share repurchases," said Jared Wolff, Chairman and CEO of Banc of California, in the company's official press release. "At the same time, retiring higher-cost subordinated debt improves our funding profile, reduces interest expense, and strengthens our overall capital structure. Together, these actions demonstrate our continued commitment to prudent capital management and delivering sustainable long-term returns to our stockholders."

Strengthening the Financial Foundation

The decision to redeem the $385 million in subordinated notes is a particularly strategic move aimed at preempting a significant rise in interest costs. The notes, originally issued by Pacific Western Bank, were scheduled to reset from a fixed 3.25% rate to a much higher floating rate on May 1, 2026. The new rate would have been calculated based on the three-month term Secured Overnight Financing Rate (SOFR) plus an additional 252 basis points (2.52%).

By redeeming these notes before the reset, Banc of California is poised to avoid a substantial financial burden. Analyst estimates project that this single action will prevent an increase in annual interest expense of approximately $10.9 million. In the context of the bank's 2025 net profits of $189.2 million, this represents a meaningful cost saving that will directly benefit the bottom line.

This move also marks a crucial step in the post-merger integration of PacWest Bancorp. Having successfully completed the systems integration and achieved planned cost synergies, Banc of California is now cleaning up the combined entity's balance sheet. Retiring this legacy debt from Pacific Western Bank demonstrates a thorough and disciplined approach to managing acquired liabilities and optimizing the capital structure for future growth.

Signaling Confidence and Rewarding Shareholders

While the debt redemption strengthens the bank's internal finances, the extension of the stock buyback program sends a powerful external message to the market. The program, originally launched in March 2025 and upsized a month later, has already seen the company repurchase approximately $217 million of its common stock, including $31 million in 2026 alone.

The extension through March 2027 provides the bank with continued authority to repurchase the remaining $83 million. Such programs are typically interpreted by investors as a sign that a company's management believes its stock is undervalued. By reducing the number of outstanding shares, buybacks increase the ownership stake of remaining shareholders and can have an accretive effect on earnings per share (EPS).

This continued commitment to returning capital to shareholders, coupled with the confidence required to execute such a program, paints a picture of a management team that is bullish on the bank's future prospects and dedicated to delivering tangible value back to its investors.

A Bullish Stance in the Regional Banking Landscape

Banc of California's assertive capital management strategy is unfolding against the backdrop of a regional banking sector that has faced intense scrutiny and volatility. In this environment, such proactive and confident moves serve as a strong indicator of institutional health and stability. The bank, now the largest independent bank headquartered in Los Angeles with over $34 billion in assets, is leveraging its enhanced scale to make strategic financial decisions that smaller competitors may not be able to afford.

Wall Street has taken notice. Ahead of the announcement, a consensus of analysts held a "Buy" rating on BANC stock, with an average price target of $20.95, suggesting significant upside potential. Financial analysis highlights the company's low PEG ratio of 0.12, indicating that its stock price may be undervalued relative to its earnings growth expectations.

Much of this positive sentiment is tied to the successful integration of PacWest, which has unlocked cost synergies and revenue opportunities. The capital actions announced today are a direct result of that success, demonstrating that the bank has moved beyond the complexities of the merger and is now firmly focused on optimization and growth. While some analysts maintain a cautious eye on the broader economic landscape, particularly regarding commercial real estate and deposit competition, the prevailing view is that Banc of California is well-positioned to navigate future challenges and capitalize on its strengthened market position.