First Community Bancorp of San Diego said Tuesday that fourth-quarter earnings fell 25.1% from a year earlier, to $17 million, mainly because of a loan-loss provision and a decline in loan yields.
Earnings per share fell 24%, to 62 cents.
The $5.2 billion-asset parent of Pacific Western Bank recorded a $3 million loan-loss provision for the quarter, after having no provision a year earlier. Nonperforming loans increased 14.5%, to $25.2 million, or 0.63% of total loans as of Dec. 31.
First Community said its net interest income fell 10%, or $7.3 million. It attributed the drop to a 32-basis-point decline in its average loan yield, to 8.29%, as interest rates fell. It also cited a decrease in average loan balances as it sold off more loans.
The company said it wanted to reduce its exposure to the slowdown in the Southern California residential construction market, so it shrank its construction loan portfolio by about 10% from the previous quarter, to $717.4 million.
Those loans now make up 17.8% of its total, net of unearned income, versus 20.3% at Sept. 30.
For the full year, net income rose 18.9%, to $90.3 million, mainly because of four acquisitions over the past two years that added about $2.5 billion of assets.
