Banc of California (BANC) in Irvine, Calif., swung to a loss in the first quarter as expenses ballooned following its acquisition of the Private Bank of California

The $4 billion-asset parent of Banc of California reported a net loss to common shareholders of $153,000 in the quarter, compared to a profit of $641,000 in the same period last year. The company said it lost a penny per share in the quarter, compared to earnings of 5 cents per share in last year's first quarter.

Excluding the payout of preferred stock dividends, the company earned $757,000 in the quarter.

During the quarter noninterest expenses increased 95.4% compared to the prior year, up to $57.7 million. It was largely driven by a 81.7% increase in salaries and employment benefits, 167.3% higher occupancy and equipment costs and an equally significant jump in other acquisition-related expenses.

In July, the bank acquired the $1 billion-asset Private Bank of California. At the same time, it converted from a savings bank to a commercial bank charter.

The company's assets roughly doubled year over year as a result of both acquisitions and strong organic loan growth. Banc of California said it originated more than $1 billion in new loans during the quarter, of which over $150 million were new commercial loans or loan commitments. Overall, loans and leases increased 95.4% year over year, to $3.4 billion, and total deposits climbed nearly 83%, to $3.1 billion.

Banc of California also recently announced that it is buying the Southern California branch network of Popular Community Bank from Puerto Rico-based Banco Popular.

"Our recently announced acquisition of Popular Community Bank's Southern California branch network will help us expand our footprint and bring the scale needed to further leverage our operational capabilities and infrastructure," Steven Sugarman, the bank's chief executive, said in a press release.

Once the acquisition is completed later this year Banc of California will have more than $5 billion of assets, a milestone Sugarman said is "critical" to the company's stated plan of strengthening its commercial lending capabilities and reducing the cost structure of its mortgage operations.

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