Pacific Premier Bancorp Reports Q1 2025 Financial Results, Announces Merger with Columbia Banking System

Pacific Premier Bancorp, Inc. reported its financial results for the first quarter of 2025, revealing a net income of $36.0 million, or $0.37 per diluted share, compared to $47.0 million, or $0.49 per diluted share, in the same period last year. The decline in profitability was primarily attributed to a significant decrease in net interest income, which fell by $21.8 million year-over-year to $123.4 million. This decrease was driven by lower average interest-earning asset balances and yields, despite a slight improvement in the net interest margin, which increased to 3.06% from 3.02% in the previous quarter.

Total assets for the company increased to $18.09 billion as of March 31, 2025, up from $17.90 billion at the end of 2024. This growth was mainly due to a $158.9 million rise in cash and cash equivalents and a $63.4 million increase in investment securities. Total liabilities also rose to $15.12 billion, reflecting a $202.5 million increase in deposits, which were bolstered by seasonal growth in the company's HOA business and branch-based deposits. The company's total stockholders' equity increased slightly to $2.97 billion, supported by net income and other comprehensive income, despite cash dividends of $31.8 million.

In terms of operational metrics, the company reported a total loan portfolio of $12.02 billion, a slight decrease from the previous quarter. The decline was attributed to lower loan purchases and a decrease in credit line draws, although new loan production and fundings increased during the quarter. The company also reported a stable allowance for credit losses (ACL) of $174.97 million, representing 1.46% of total loans held for investment, a slight decrease from 1.48% at the end of 2024.

Strategically, Pacific Premier Bancorp announced a proposed merger with Columbia Banking System, Inc., which was unanimously approved by both companies' boards. Under the terms of the merger agreement, shareholders of Pacific Premier will receive shares of Columbia's common stock, with the merger expected to enhance the combined entity's market presence and operational efficiencies. The merger is subject to regulatory and shareholder approvals, and the company has indicated that it will not pay dividends in excess of the current level due to the pending merger.

Looking ahead, the company remains focused on maintaining its strong capital position and managing credit risk effectively. The management expressed confidence in navigating potential economic uncertainties, supported by a robust liquidity position and a diversified loan portfolio. The company’s proactive approach to balance sheet management and strategic growth initiatives positions it well for future opportunities.