Banc of California, Inc. (NYSE:BANC) Q3 2023 Earnings Call Transcript

Jared Wolff: Yeah, I see lending, actually, given that the Fed recently seems to have paused a bit, and Paul’s comments suggested that they’re going to take a wait and see approach, and he was much more cautious on rate rises than he’s been in the past. I think that gave the market a little bit of a more positive outlook. And if rates stabilize, I think you’re going to see a return to economic activity. I think there were some real concerns about what people were getting themselves into, and so we see kind of a built up demand and that economic activity is going to start returning. Even at these rates, there’s plenty of business to do, especially if people think that they can absorb rates at this level, knowing that they’re probably peak and we’ll be going down from there.

And so also, if you have visibility that rates aren’t rising, it allows people to fix rates for a reasonable period of time as well. And so all of those things banks can make decisions about what a good fixed rate loan looks like, because once you stabilize the market, I just think that there’s going to be a lot more opportunity that appears. And so the timing is going to be very good. I think it’s going to be across all sectors. David, I think, obviously, service activity slowing with real estate activity slowing, those things all intertwine transactions move our economy, and transaction volume is down, except for consumers. The restaurant business seems to be humming in our neighborhood. I don’t know what it’s like where you are, but we’re not seeing any slowdown of spending on the consumer side.

But business has slowed, but we expect it across the board to pick up as rates stabilize.

David Feaster: All right. That’s helpful. Color. Thank you.

Jared Wolff: Thank you.

Operator: Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time. And thank you for your participation.