PacWest Bancorp in Los Angeles reported higher quarterly profit led by its acquisition of Square 1 Financial in Durham, N.C.
The $21 billion-asset PacWest said in a press release Thursday that its first-quarter net income rose 24% from a year earlier, to $90.5 million, or 74 cents a share. PacWest bought Square 1 in October for $847 million.
PacWest said it added about $1.6 billion in loans from the Square 1 deal.
Net interest income, including the loan-loss provision, rose 23% to $224.5 million. Loans and leases rose 17% to $236 million, while the net interest margin narrowed by 42 basis points to 5.53%.
Noninterest income rose 65% to $34.5 million because of higher deposit service charges, increased leased equipment income and a higher securities gains. PacWest, which reduced the amount of its loss-sharing expense, also benefited from a $900,000 loan syndication fee and a $600,000 death benefit on a bank-owned life insurance policy.
Noninterest expense rose 31% to $110.7 million, reflecting higher salary, occupancy, data processing and leased equipment expenses and intangible asset amortization. The efficiency ratio worsened to 38.5% from 36.9%.