Regional bank Banc of California (NYSE: BANC) reported Q4 CY2025 results topping the market’s revenue expectations, with sales up 10.7% year on year to $292.9 million. Its non-GAAP profit of $0.42 per share was 13.7% above analysts’ consensus estimates.

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Jared Wolff, Chairman & CEO of Banc of California, commented, “Our fourth quarter results capped a year of strong execution, reflect the continued momentum of our core earnings engine, and validate our ongoing business strategy. During the quarter we delivered double-digit annualized loan and noninterest-bearing deposit growth, and achieved double-digit return on average tangible common equity, all while maintaining disciplined expense management and stable credit quality. These results underscore the strength of our franchise and our ability to consistently deliver profitable growth.”

Company Overview

Originally established in 1941 and now operating with a tech-forward approach that includes its SmartStreet platform for homeowner associations, Banc of California (NYSE: BANC) is a California-based bank holding company that provides banking services to small and middle-market businesses, entrepreneurs, and individuals.

Sales Growth

In general, banks make money from two primary sources. The first is net interest income, which is interest earned on loans, mortgages, and investments in securities minus interest paid out on deposits. The second source is non-interest income, which can come from bank account, credit card, wealth management, investing banking, and trading fees. Unfortunately, Banc of California struggled to consistently increase demand as its $1.12 billion of revenue for the trailing 12 months was close to its revenue five years ago. This was below our standards and suggests it’s a low quality business.

We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. Banc of California’s annualized revenue growth of 7.5% over the last two years is above its five-year trend, but we were still disappointed by the results. Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, Banc of California reported year-on-year revenue growth of 10.7%, and its $292.9 million of revenue exceeded Wall Street’s estimates by 1.3%.

Net interest income made up 88.3% of the company’s total revenue during the last five years, meaning Banc of California barely relies on non-interest income to drive its overall growth.

Markets consistently prioritize net interest income growth over fee-based revenue, recognizing its superior quality and recurring nature compared to the more unpredictable non-interest income streams.

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Tangible Book Value Per Share (TBVPS)

Banks operate as balance sheet businesses, with profits generated through borrowing and lending activities. Valuations reflect this reality, emphasizing balance sheet strength and long-term book value compounding ability.

Because of this, tangible book value per share (TBVPS) emerges as the critical performance benchmark. By excluding intangible assets with uncertain liquidation values, this metric captures real, liquid net worth per share. Other (and more commonly known) per-share metrics like EPS can sometimes be murky due to M&A or accounting rules allowing for loan losses to be spread out.

Banc of California’s TBVPS declined at a 3.9% annual clip over the last five years. However, TBVPS growth has accelerated recently, growing by 7.9% annually over the last two years from $15.04 to $17.51 per share.

Over the next 12 months, Consensus estimates call for Banc of California’s TBVPS to grow by 7.7% to $18.86, paltry growth rate.

Key Takeaways from Banc of California’s Q4 Results

We were impressed by how significantly Banc of California blew past analysts’ net interest income expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. Zooming out, we think this quarter featured some important positives. The market seemed to be hoping for more, and the stock traded down 5% to $20.04 immediately following the results.

Big picture, is Banc of California a buy here and now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).