PacWest Bancorp (PACW) in Los Angeles reported a surge in quarterly profits as the company produced more loan revenue.
The $15.6 billion-asset company reported earnings of $25.1 million in the first quarter, up 86% from the same period a year ago. Earnings per share of 55 cents were 9 cents higher than the estimates of analysts polled by Bloomberg.
PacWest's net interest income climbed 31%, to $86 million, as the company gained more income from loans and leases and lowered expenses on deposits. The company's net interest margin climbed 55 basis points, to 5.95%.
Noninterest income rose 68%, to $4.7 million, as the company received more Federal Deposit Insurance Corp. loss-sharing income and gained more on the sale of securities. Noninterest expense climbed 15%, to $50.9 million. The increase was primarily driven by higher merger-related costs and increased compensation costs.
PacWest recovered $644,000 from its loan-loss provision, compared with a $3.1 million provision during the first quarter of 2013. It also recovered $861,000 from previously charged-off loans, nearly three times its recoveries during the prior-year period.
PacWest completed its acquisition of the $9.1 billion-asset CapitalSource, also in Los Angeles, on April 7. PacWest paid roughly $3.1 billion in the deal.