Losses From Loan Sales And OTTI Charges Responsible For PPBI’s Earnings Miss

Analysts at Sterne Agee reiterate their "neutral" rating on Pacific Premier Bancorp

, while revising their estimates for the company. PPBI reported weaker-than-expected Q2 earnings. Sterne Agee mentions, “The primary driver of the miss was a loss on loan sales of $1.6 million, versus our $0.5 million estimate and a $330,000 OTTI charge. Spread income of $6.8 million came in ahead of our estimate, driven by 18 basis points of margin expansion, compared with our expectation of 9 bps. On a core basis, the quarter came in mostly as expected.” “Credit quality improved significantly, driven by declines in NPLs and OREO, down 55% and 70%, respectively, linked quarter. Losses declined 9 basis points Q/Q, to 0.48% of average loans, while 0.35% of loans were non-performing, down notably (-43 bps) from 1Q,” the analysts add. Sterne Agee has lowered its EPS estimate for 2010 from $0.26 to $0.23, while raising the EPS estimate for 2011 from $0.38 to $0.45.