PacWest Bancorp (PACW) in Los Angeles more than doubled its first-quarter profit as it reduced its loan-loss provision by $10 million.
The $5.3 billion-asset company earned $13.5 million in the first quarter, a 156% rise from the year-prior period. But its profit was down 32% from the fourth quarter, and per-share earnings of 37 cents were 10 cents lower than analysts polled by Bloomberg expected.
PacWest reported declines in loan and fee income in the first quarter. Net interest income fell 3%, to $65.7 million, compared to the first quarter of 2012. Net interest margin declined by 1 basis point, to 5.40%, and average interest-earning assets fell 2%.
Noninterest income fell 13%, to $2.8 million, as service charges and other items declined.
PacWest made no provision for loan losses, after making a $10 million provision in the first quarter of 2012. Its net chargeoffs declined to $223,000 from more than $2 million in the first quarter of 2012.
Its expenses fell 36%, to $44.2 million, a decline that reflects a $22.6 million debt-termination fee PacWest paid in the first quarter of 2012. PacWest's compensation expense rose 5%, to $25.4 million.
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