Ryan Herron
There’s a lot of work ahead for the management of Banc of California (NYSE:BANC). In addition to the normal integration work that would be required to bring PacWest into the fold after the 2023
Banc of California: Opportunity Amidst The Noise
Summary
- Banc of California has been busy since closing the PacWest deal, including billions of dollars of balance sheet restructuring in Q1 that meaningfully reduces funding costs.
- I expect above-average growth in 2025 driven by balance sheet restructuring, NIM improvement, and cost synergies from the PacWest deal.
- Long-term core earnings growth should grow at 5-6%, driving a fair value above $15, and the shares also appear undervalued on ROTCE-driven P/TBV, with a potential fair value of $18.50-$20.
Stephen Simpson is a freelance financial writer and investor.Spent close to 15 years on the Street (sell-side, buy-side, equities, bonds).
Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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