Pacific Premier Bancorp, Inc.

For Q4 2024, Pacific Premier Bancorp reported net income of $33.9 million and diluted EPS of $0.35. Total revenue was $144.5 million, non-interest expense was $100.7 million, pre-provision net revenue was $43.8 million, and the efficiency ratio was 67.8%. Net interest income was $124.5 million and net interest margin was 3.02%, down 14 bps linked quarter; average funding costs fell 9 bps to 1.88%, while cost of deposits was 1.79%. Noninterest income was $20 million and the company recorded a provision recapture of $814,000. On the balance sheet, total assets were $17.9 billion, total deposits were $14.5 billion, cash was $610.6 million, and the loan-to-deposit ratio was 83.3%. Management guided to 2025 net interest income of $500 million to $525 million, noninterest income of $80 million to $85 million, noninterest expense of $405 million to $415 million, and low- to mid-single-digit loan growth. Ron Nicolas also said December NIM was 3.03% and that first-quarter NIM should be around current levels.

Steve Gardner’s tone was constructive and more optimistic about 2025, tying the outlook to rate cuts, post-election clarity, and a more business-friendly environment. He emphasized that the bank is positioned to grow loans and deposits, deepen client relationships, and selectively use capital for loan purchases, balance-sheet optimization, buybacks, debt repayment, and M&A. He also highlighted the wildfire response in Southern California, including new lending initiatives for displaced homeowners and businesses and support for rebuild activity.

Ron Nicolas focused on improving funding mix, margin mechanics, and balance-sheet strength. He said non-maturity deposits increased by $145.8 million to $12.4 billion, higher-cost deposits fell, cost of funds declined to 1.88%, and deposit costs were 1.79%; he also noted about $4 million of swap income recognized in Q4 and expected $2 million to $3 million in Q1. He guided to full-year 2025 net interest income of $500 million to $525 million, noninterest income of $80 million to $85 million, noninterest expense of $405 million to $415 million, and said liquidity remains strong with $610.6 million of cash, $9 billion of unused borrowing capacity, and $1.1 billion of scheduled cash flow from the securities portfolio.

Analysts focused on margin direction, loan-purchase strategy, CRE appetite, deposit repricing, capital deployment, and M&A. Management said Q1 margin should stay around current levels, with more improvement possible later in 2025 as funding costs and asset yields adjust; they also said loan purchases will remain tactical and can include non-CRE or CRE assets if risk-adjusted returns are attractive. On CRE, Steve Gardner said the lower concentration ratio does not materially change appetite, but the bank is willing to add some exposure while avoiding significant growth there. On M&A, management said conversations have picked up as regulatory and market sentiment improved, and they remain open to attractive transactions.