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Pacific West Bancorp Reports Solid Fourth Quarter Results

Pacific West Bancorp (PWBK), the parent company of Pacific West Bank (PWB), has revealed its financial results for the fourth quarter of 2024, showcasing a small but significant net income of $155 thousand, equating to earnings of $0.06 per diluted share. These results are particularly noteworthy as they contribute to a full-year net loss that totals $338 thousand, or $0.13 per diluted share. However, the quarterly performance indicates a potential turnaround and a promising trajectory for future growth.

Key Highlights of the Fourth Quarter

One of the most compelling aspects of this quarter's financials was the increase in core deposits, which grew by $7.2 million. In contrast, the company successfully retired $10 million in non-core funding. Moreover, unfunded lending commitments grew by approximately $11 million, anticipated to be funded in the first half of 2025. The company also made strides in reducing its borrowings, retiring $13.5 million, which represents 41.1% of its total borrowings, thereby further refining its net non-core funding ratio.

The interest expenses witnessed a reduction of $234.3 thousand, down by 10.2% as compared to the previous quarter. Moreover, net interest income before provisions surged by $267.4 thousand, reflecting an uptick of 11.7%. Furthermore, the net interest margin saw an increase of 31 basis points from the previous quarter, signaling improving profitability.

Full Year Overview

Looking back at the entire year of 2024, PWBK reported an interest income of $17.4 million, which is an impressive increase of $2.9 million or 19.8% from the previous year. Core deposits also witnessed significant growth, up by $54.4 million, marking a 25.15% rise compared to the previous year. This last year saw Pacific West Bank retire $25.4 million of its borrowings, representing a substantial reduction of 56.8% when compared to the previous year’s figure. Additionally, total assets rose by $8.8 million, or 2.8% year-over-year, reinforcing the bank's solid financial foundation.

According to Jason Wessling, President and CEO of PWB, the bank's momentum significantly accelerated in the second half of the year as they increased core deposits. This allowed them to reduce reliance on higher-cost funding options, such as brokered deposits. The switch in the funding mix, along with competitive new loan pricing, led to record interest income for the bank. Wessling emphasized the bank's commitment to building lasting relationships and providing exceptional service, confirming PWB's reputation as a premier business bank serving the Portland and Southwest Washington areas.

In terms of loan activity, Pacific West Bank reported the origination of $11 million in new loan commitments during the quarter at a weighted average interest rate of 7.59%. The loan quality remained steady, with no loans overdue for more than 30 days and only one non-accrual loan.

Strategic Focus and Community Impact

Lisa Faust, the Chief Banking Officer of Pacific West Bank, mentioned that their strategic focus on delivering excellent service has been a driving factor in growing core deposits. The bank aims to create specialized niches, particularly in serving digital partners, social impact organizations, and professional services, which has resulted in substantial growth in non-interest-bearing deposits.

PWBK continues to position itself as a Benefit Corporation for Good, demonstrating a commitment to positively impacting the communities it serves while maintaining its growth with purpose and responsibility. As of the end of 2024, the bank's leverage ratio stood at 10.29%, which showcases its capital strength and readiness for future opportunities.

As Pacific West Bank moves into 2025, it remains optimistic about continuing to improve earnings and asset growth, driven by a strong commitment to its clients and community engagement. For more information about PWBK, you can visit their official website.