UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38621 PCB BANCORP (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organiz ...

Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38621 PCB BANCORP UNITED STATES SECURITIES AND EXCHANGE COMMISSION (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organi ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark one) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38621 PCB Bancorp (Exact name of registrant as specified in its charter) California 20-8856755 (State or other jurisdiction of incorp ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38621 PCB BANCORP (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.) California 20-8856755 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXC ...

Part I - Financial Information [Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) Presents PCB Bancorp's unaudited Q2 2022 consolidated financial statements, detailing financial position, performance, and cash flows [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Details PCB Bancorp's financial position as of June 30, 2022, reflecting growth in assets, liabilities, and shareholders' equity Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2022 (Unaudited) | December 31, 2021 | | :--- | :--- | :--- | | **Total Assets** | **$2,344,560** | **$2,149,735** | | Total cash and cash equivalents | $299,910 | $203,285 | | Net loans held-for-investment | $1,811,939 | $1,709,824 | | **Total Liabilities** | **$2,010,185** | **$1,893,449** | | Total deposits | $1,997,607 | $1,867,134 | | **Total Shareholders' Equity** | **$334,375** | **$256,286** | - A key change in equity was the issuance of **69,141 shares of Series C Preferred Stock** with a liquidation preference of **$69.1 million**[10](index=10&type=chunk) [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) Presents PCB Bancorp's income statement for Q2 2022, detailing changes in net income, net interest income, and other revenue Key Income Statement Data (in thousands, except per share data) | Metric | Q2 2022 | Q2 2021 | Six Months 2022 | Six Months 2021 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $21,351 | $18,996 | $41,344 | $36,815 | | Reversal for loan losses | $(109) | $(934) | $(1,300) | $(2,081) | | Gain on sale of loans | $2,039 | $3,967 | $5,816 | $5,289 | | **Net Income** | **$9,092** | **$9,844** | **$19,332** | **$18,404** | | **Diluted EPS** | **$0.60** | **$0.64** | **$1.27** | **$1.19** | [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Details PCB Bancorp's comprehensive income for Q2 2022, highlighting the impact of unrealized gains or losses Comprehensive Income (in thousands) | Metric | Q2 2022 | Q2 2021 | Six Months 2022 | Six Months 2021 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $9,092 | $9,844 | $19,332 | $18,404 | | Other comprehensive income (loss), net of tax | $(2,902) | $285 | $(6,754) | $(813) | | **Total Comprehensive Income** | **$6,190** | **$10,129** | **$12,578** | **$17,591** | [Consolidated Statements of Changes in Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) Outlines changes in PCB Bancorp's shareholders' equity, driven by preferred stock issuance, net income, and dividends - The company issued **69,141 shares of preferred stock** in **Q2 2022**, adding **$69.1 million** to shareholders' equity[16](index=16&type=chunk) - Cash dividends declared on common stock totaled **$2.2 million** (**$0.15 per share**) in **Q2 2022** and **$4.5 million** (**$0.30 per share**) for the first six months of **2022**[16](index=16&type=chunk)[17](index=17&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Summarizes PCB Bancorp's cash flows for the six months ended June 30, 2022, across operating, investing, and financing Cash Flow Summary - Six Months Ended June 30 (in thousands) | Activity | 2022 | 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $38,778 | $7,205 | | Net cash used in investing activities | $(127,854) | $(146,834) | | Net cash provided by financing activities | $185,701 | $120,152 | | **Net increase (decrease) in cash** | **$96,625** | **$(19,477)** | [Notes to Consolidated Financial Statements (Unaudited)](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20%28Unaudited%29) Provides detailed explanations of PCB Bancorp's accounting policies, financial components, and significant subsequent events - The company plans to adopt **ASU 2016-13** (**CECL**) on **January 1, 2023**, and expects a one-time cumulative effect adjustment to the allowance for loan losses which could be material[37](index=37&type=chunk)[38](index=38&type=chunk) - As of **June 30, 2022**, the company had no loans under modified terms related to the **COVID-19** pandemic[32](index=32&type=chunk)[57](index=57&type=chunk) - On **May 24, 2022**, the company issued **69,141 shares of Series C Preferred Stock** for a capital investment of **$69.1 million** from the **U.S. Treasury** under the **ECIP**[88](index=88&type=chunk) - Subsequent to quarter-end, the Board approved a new stock repurchase program for up to **5%** of outstanding common stock and declared a quarterly cash dividend of **$0.15 per share**[114](index=114&type=chunk)[115](index=115&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses PCB Bancorp's financial condition and results, highlighting key trends in income, assets, and capital [Executive Summary](index=40&type=section&id=Executive%20Summary) Summarizes PCB Bancorp's key financial results for Q2 2022, including net income, asset growth, and capital events Q2 2022 Financial Highlights (in millions) | Metric | Q2 2022 | Change from Q2 2021 | | :--- | :--- | :--- | | Net Income | $9.1 million | -7.6% | | Net Interest Income | $21.4 million | +12.6% (from $19.0M) | | Gain on Sale of Loans | $2.0 million | -48.6% (from $4.0M) | | Total Assets (vs 12/31/21) | $2.34 billion | +9.1% | | Loans Held-for-Investment (vs 12/31/21) | $1.83 billion | +5.8% | - The company issued **$69.1 million** in preferred stock through the **U.S. Treasury's Emergency Capital Investment Program** (**ECIP**)[136](index=136&type=chunk) - **Pacific City Bank** will change its name to **PCB Bank**, effective **August 25, 2022**[132](index=132&type=chunk) [Results of Operations](index=41&type=section&id=Results%20of%20Operations) Analyzes PCB Bancorp's Q2 2022 operational performance, focusing on net interest income, loan loss provisions, and expenses Net Interest Income Analysis (Q2 2022 vs Q2 2021) (in millions) | Metric | Q2 2022 | Q2 2021 | | :--- | :--- | :--- | | Net Interest Income | $21.4 million | $19.0 million | | Net Interest Margin | 4.01% | 3.83% | | Net Interest Spread | 3.79% | 3.64% | - The reversal for loan losses was **$109 thousand** in **Q2 2022**, compared to **$934 thousand** in **Q2 2021**, primarily due to improving economic conditions offset by loan growth[167](index=167&type=chunk) - Gain on sale of loans decreased to **$2.0 million** in **Q2 2022** from **$4.0 million** in **Q2 2021**, due to lower premiums on **SBA loans** in the secondary market[171](index=171&type=chunk) - Salaries and employee benefits increased by **$1.0 million** (**14.0%**) YoY in **Q2 2022**, due to annual merit increases and a higher number of employees (**271 vs 248**)[176](index=176&type=chunk) [Financial Condition](index=50&type=section&id=Financial%20Condition) Assesses PCB Bancorp's financial condition as of June 30, 2022, detailing asset composition, loan portfolio, and capital Loan Portfolio Composition (in thousands) | Loan Type | June 30, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Total real estate loans | $1,606,416 | $1,453,241 | | Total commercial and industrial loans | $204,369 | $257,343 | | SBA PPP | $1,583 | $65,329 | | **Total loans held-for-investment** | **$1,833,010** | **$1,732,205** | Asset Quality Ratios | Metric | June 30, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Nonperforming assets to total assets | 0.09% | 0.05% | | Allowance for loan losses to loans HFI | 1.15% | 1.29% | | Total nonperforming assets | $2,031 thousand | $994 thousand | - Total deposits increased by **$130.5 million** (**7.0%**) to **$2.0 billion**, with noninterest-bearing demand deposits growing by **$158.1 million** (**19.0%**)[208](index=208&type=chunk) - Shareholders' equity increased by **$78.1 million** (**30.5%**) to **$334.4 million**, primarily due to a **$69.1 million** preferred stock issuance and **$19.3 million** in net income[212](index=212&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=61&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Discusses PCB Bancorp's management of interest rate risk using simulation models for Net Interest Income and Economic Value of Equity Interest Rate Sensitivity Analysis (June 30, 2022) | Simulated Rate Change | Net Interest Income Sensitivity | Economic Value of Equity Sensitivity | | :--- | :--- | :--- | | +300 bps | +17.2% | +4.3% | | +200 bps | +11.7% | +3.7% | | +100 bps | +5.9% | +2.2% | - The company's interest rate risk management is overseen by the **Board ALCO** and a monthly **Management ALCO**, aiming to minimize the impact of rate changes on **net interest income** and **economic value**[235](index=235&type=chunk) [Controls and Procedures](index=62&type=section&id=Item%204.%20Controls%20and%20Procedures) Management evaluated PCB Bancorp's disclosure controls and procedures, concluding effectiveness with no material Q2 2022 changes - The **CEO** and **CFO** concluded that as of **June 30, 2022**, the company's disclosure controls and procedures were effective[242](index=242&type=chunk) - No changes occurred during **Q2 2022** that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[243](index=243&type=chunk) Part II - Other Information [Legal Proceedings](index=63&type=section&id=Item%201.%20Legal%20Proceedings) Details PCB Bancorp's involvement in legal claims, including a data incident class action, with no material expected effect - A class action lawsuit was filed against the Bank on **December 16, 2021**, following a network data incident. The Bank intends to vigorously defend itself[247](index=247&type=chunk) - Expenses related to the data incident totaled **$100 thousand** in **2021**, representing the insurance retention amount. No additional expenses were incurred in the first six months of **2022**[248](index=248&type=chunk) [Risk Factors](index=63&type=section&id=Item%201A.%20Risk%20Factors) States no material changes to risk factors previously disclosed in PCB Bancorp's 2021 Annual Report on Form 10-K - Management is not aware of any material changes to the risk factors disclosed in the **2021 Annual Report on Form 10-K**[249](index=249&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=64&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Reports the unregistered sale of **$69.1 million** in **Series C Preferred Stock** to the **U.S. Treasury** under **ECIP**, with no repurchases - On **May 24, 2022**, the Company issued **69,141 shares of Series C Preferred Stock** for **$69.1 million** to the **U.S. Treasury** under the **ECIP** in an unregistered transaction[252](index=252&type=chunk) - No shares were repurchased during the three months ended **June 30, 2022**[252](index=252&type=chunk) [Defaults Upon Senior Securities](index=64&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) None - None[253](index=253&type=chunk) [Mine Safety Disclosures](index=64&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Not applicable - Not applicable[254](index=254&type=chunk) [Other Information](index=64&type=section&id=Item%205.%20Other%20Information) None - None[255](index=255&type=chunk) [Exhibits](index=65&type=section&id=Item%206.%20Exhibits) Lists the exhibits filed with the Form 10-Q, including articles of incorporation, bylaws, agreements, and certifications Signatures

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38621 PCB BANCORP (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organi ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark one) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38621 PCB Bancorp (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organizatio ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-38621 PCB BANCORP (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or or ...

[Part I - Financial Information](index=4&type=section&id=Part%20I%20-%20Financial%20Information) [Item 1. Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements for PCB Bancorp and its subsidiary, including balance sheets, income statements, cash flows, and accompanying notes [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2021, total assets grew to **$2.06 billion** from **$1.92 billion** at year-end 2020, driven by an increase in net loans, while total liabilities increased due to a significant rise in noninterest-bearing demand deposits to **$795.7 million** from **$538.0 million**, and total shareholders' equity saw a modest increase to **$238.9 million** Consolidated Balance Sheet Highlights (Unaudited) | ($ in thousands) | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Total Assets** | **$2,060,003** | **$1,922,853** | | Total cash and cash equivalents | $174,621 | $194,098 | | Net loans held-for-investment | $1,694,767 | $1,557,068 | | **Total Liabilities** | **$1,821,062** | **$1,689,065** | | Total deposits | $1,797,648 | $1,594,851 | | Noninterest-bearing demand deposits | $795,741 | $538,009 | | Federal Home Loan Bank advances | $10,000 | $80,000 | | **Total Shareholders' Equity** | **$238,941** | **$233,788** | [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) For Q2 2021, net income surged to **$9.8 million** from **$3.4 million** in Q2 2020, driven by higher net interest income, a significant reversal of provision for loan losses, and a large gain on the sale of loans, resulting in diluted EPS of **$0.64** compared to **$0.22** Key Income Statement Data (Unaudited) | ($ in thousands) | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :--- | :--- | :--- | :--- | :--- | | Net interest income | $18,996 | $15,363 | $36,815 | $31,929 | | Provision (reversal) for loan losses | $(934) | $3,855 | $(2,081) | $6,751 | | Noninterest income | $5,151 | $2,918 | $8,008 | $4,944 | | Noninterest expense | $11,139 | $9,696 | $20,808 | $20,263 | | **Net income** | **$9,844** | **$3,367** | **$18,404** | **$6,939** | | **Diluted EPS** | **$0.64** | **$0.22** | **$1.19** | **$0.45** | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2021, net cash used in investing activities was **$146.8 million**, primarily due to net loan growth, while net cash provided by financing activities was **$120.2 million**, driven by increased deposits, resulting in an overall decrease of **$19.5 million** in cash and cash equivalents Cash Flow Summary for Six Months Ended June 30 (Unaudited) | ($ in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Net cash provided by operating activities | $7,205 | $4,810 | | Net cash used in investing activities | $(146,834) | $(112,127) | | Net cash provided by financing activities | $120,152 | $268,692 | | **Net (decrease) increase in cash and cash equivalents** | **$(19,477)** | **$161,375** | [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed disclosures on accounting policies, financial instruments, COVID-19 related loan modifications, PPP loans, and regulatory capital - As of June 30, 2021, the Company had **$16.2 million** in loans under modified terms related to the COVID-19 pandemic, all of which were accounted for under the CARES Act and not considered Troubled Debt Restructurings (TDRs)[31](index=31&type=chunk) - The company held **$181.0 million** in SBA Paycheck Protection Program (PPP) loans as of June 30, 2021. During the first six months of 2021, it funded **$107.0 million** in new PPP loans and recognized **$65.6 million** in loan forgiveness[32](index=32&type=chunk)[33](index=33&type=chunk) - On April 8, 2021, the Board approved a new stock repurchase program for up to **775,000 shares**. As of June 30, 2021, **646,334 shares** were repurchased for **$10.3 million** at a weighted-average price of **$15.99 per share**[93](index=93&type=chunk) - Both the Company and its subsidiary bank, Pacific City Bank, met all capital adequacy requirements as of June 30, 2021, with capital conservation buffers of **8.43%** and **8.13%**, respectively, well above the **2.50%** requirement[110](index=110&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance and condition, highlighting increased net income, asset and deposit growth, improved asset quality, and robust liquidity and capital resources [Executive Summary and Financial Highlights](index=41&type=section&id=Executive%20Summary%20and%20Financial%20Highlights) The company reported strong Q2 2021 results with net income of **$9.8 million**, a **192.4%** increase from Q2 2020, driven by a **$(934) thousand** reversal of provision for loan losses and a **$4.0 million** gain on sale of loans, with total assets growing **7.1%** to **$2.06 billion** and deposits increasing **12.7%** to **$1.80 billion** Q2 2021 Financial Highlights vs. Q2 2020 | Metric | Q2 2021 | Q2 2020 | | :--- | :--- | :--- | | **Net Income** | **$9.8 million** | **$3.4 million** | | Provision (reversal) for loan losses | $(934) thousand | $3.9 million | | Net Interest Income | $19.0 million | $15.4 million | | Gain on sale of loans | $4.0 million | $1.5 million | Balance Sheet Highlights (June 30, 2021 vs. Dec 31, 2020) | Metric | June 30, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | **Total Assets** | **$2.06 billion** | **$1.92 billion** | | **Loans held-for-investment** | **$1.72 billion** | **$1.58 billion** | | **Total Deposits** | **$1.80 billion** | **$1.59 billion** | | **SBA PPP Loans** | **$181.0 million** | **$135.7 million** | | **Loans under COVID-19 modification** | **$16.2 million** | **$36.1 million** | [Results of Operations](index=41&type=section&id=Results%20of%20Operations) For Q2 2021, net interest income increased **23.6%** year-over-year to **$19.0 million**, driven by a **70.8%** drop in interest expense, while the company recorded a loan loss provision reversal of **$934 thousand**, and noninterest income grew **76.5%** to **$5.2 million** largely due to a **164.8%** increase in gain on sale of loans - Net interest income for Q2 2021 increased by **$3.6 million (23.6%)** compared to Q2 2020, primarily due to a **$2.6 million (70.8%)** decrease in total interest expense[138](index=138&type=chunk) - The company recorded a reversal for loan losses of **$934 thousand** in Q2 2021, a significant shift from the **$3.9 million** provision in Q2 2020, attributed to improving economic conditions[151](index=151&type=chunk) - Gain on sale of loans surged to **$4.0 million** in Q2 2021 from **$1.5 million** in Q2 2020, driven by higher premiums and increased sales volume of SBA loans[155](index=155&type=chunk) - Salaries and employee benefits expense increased by **$1.4 million (23.7%)** in Q2 2021, mainly because direct loan origination costs related to SBA PPP loans, which offset salary expenses, were much lower (**$62 thousand**) compared to the prior year (**$1.1 million**)[162](index=162&type=chunk) [Financial Condition](index=50&type=section&id=Financial%20Condition) As of June 30, 2021, the company's financial condition strengthened with total assets reaching **$2.06 billion**, a loan portfolio of **$1.72 billion**, significantly improved asset quality with nonperforming assets decreasing **68.3%** to **$1.5 million**, and total deposits growing by **$202.8 million**, while shareholders' equity increased to **$238.9 million** - Loans held-for-investment increased by **$136.1 million (8.6%)** to **$1.72 billion** in the first six months of 2021, with SBA PPP and commercial property loans being the primary drivers of growth[179](index=179&type=chunk) - Total nonperforming assets decreased significantly to **$1.5 million (0.07% of total assets)** at June 30, 2021, from **$4.6 million (0.24% of total assets)** at December 31, 2020[195](index=195&type=chunk) - Total deposits increased by **$202.8 million (12.7%)** since year-end 2020, largely due to a **47.9%** increase in noninterest-bearing demand deposits, which were boosted by funds from government programs like PPP[198](index=198&type=chunk) - Shareholders' equity increased by **$5.2 million** to **$238.9 million** in the first half of 2021. The growth from net income (**$18.4 million**) was partially offset by stock repurchases (**$10.3 million**) and dividends (**$3.1 million**)[203](index=203&type=chunk) [Liquidity and Capital Resources](index=58&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained a strong liquidity position with **$174.6 million** in cash and cash equivalents as of June 30, 2021, supported by **$502.7 million** in additional FHLB borrowing capacity and **$65.0 million** in unsecured federal funds lines, with all regulatory capital ratios significantly exceeding 'well-capitalized' standards - The company has substantial available liquidity, including **$502.7 million** in additional borrowing capacity from the FHLB and **$65.0 million** in unused federal funds lines as of June 30, 2021[213](index=213&type=chunk) Regulatory Capital Ratios as of June 30, 2021 | Ratio | Pacific City Bank | Well Capitalized Requirement | | :--- | :--- | :--- | | Common tier 1 capital (to risk-weighted assets) | 14.88% | 6.5% | | Total capital (to risk-weighted assets) | 16.13% | 10.0% | | Tier 1 capital (to risk-weighted assets) | 14.88% | 8.0% | | Tier 1 capital (to average assets) | 11.53% | 5.0% | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=61&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company actively manages interest rate risk using NII at Risk and EVE models, with its balance sheet positioned as asset-sensitive, projecting a **10.8%** increase in NII and an **8.0%** increase in EVE from a hypothetical immediate 100 basis point rate rise Interest Rate Risk Sensitivity Analysis (as of June 30, 2021) | Simulated Rate Change | Net Interest Income Sensitivity | Economic Value of Equity Sensitivity | | :--- | :--- | :--- | | +300 bps | +32.3% | +18.6% | | +200 bps | +21.6% | +14.2% | | +100 bps | +10.8% | +8.0% | - The company's balance sheet is positioned to be **asset-sensitive**, indicating that net interest income is expected to rise if short-term interest rates increase[228](index=228&type=chunk) [Item 4. Controls and Procedures](index=62&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2021, with no material changes to internal control over financial reporting during Q2 2021 - The CEO and CFO concluded that as of June 30, 2021, the company's disclosure controls and procedures were **effective**[232](index=232&type=chunk) - No material changes were made to the internal control over financial reporting during the three months ended June 30, 2021[233](index=233&type=chunk) [Part II - Other Information](index=63&type=section&id=Part%20II%20-%20Other%20Information) [Item 1. Legal Proceedings](index=63&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal claims arising in the normal course of business, which management does not expect to have a material effect on the consolidated financial statements, with no accrued loss contingencies for legal claims at June 30, 2021 - The Company is involved in various legal claims in the normal course of business but does not expect them to have a **material financial impact**[235](index=235&type=chunk) [Item 1A. Risk Factors](index=63&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2020 - No material changes to the risk factors disclosed in the 2020 Annual Report on Form 10-K were reported[236](index=236&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=63&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities for the quarter, but repurchased **646,334 shares** of common stock at an average price of **$15.99 per share** under a program approved on April 8, 2021 Share Repurchase Activity (Q2 2021) | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April 2021 | 12,737 | $15.89 | | May 2021 | 619,904 | $15.99 | | June 2021 | 13,693 | $15.98 | | **Total** | **646,334** | **$15.99** | - A new stock repurchase program was approved on April 8, 2021, authorizing the repurchase of up to **775,000 shares** through September 7, 2021[238](index=238&type=chunk) [Item 6. Exhibits](index=64&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including certifications by the CEO and CFO pursuant to the Sarbanes-Oxley Act of 2002 and Inline XBRL documents - The report includes CEO and CFO certifications under Sections 302 and 906 of the Sarbanes-Oxley Act, along with various corporate documents and XBRL data files[242](index=242&type=chunk)

(Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.) Cal ...