First Quarter 2022 Summary

• Net income of $66.9 million, or $0.70 per diluted share
• Return on average assets of 1.28%, return on average equity of 9.34%, and return on average tangible common equity of 14.66%⁽¹⁾
• Diversified loan growth of $438.6 million, or 12.3% annualized
• Deposit growth of $573.6 million, or 13.4% annualized
• Net interest margin of 3.41%, and core net interest margin of 3.33%⁽¹⁾
• Cost of deposits remained unchanged at 0.04%
• Noninterest-bearing deposits increased to 40.2% of total deposits
• Nonperforming assets to total assets of 0.26%, and classified assets to total assets of 0.57%

IRVINE, Calif.--(BUSINESS WIRE)-- Pacific Premier Bancorp, Inc. (NASDAQ: PPBI) (the “Company” or “Pacific Premier”), the holding company of Pacific Premier Bank (the “Bank”), reported net income of $66.9 million, or $0.70 per diluted share, for the first quarter of 2022, compared with net income of $84.8 million, or $0.89 per diluted share, for the fourth quarter of 2021, and net income of $68.7 million, or $0.72 per diluted share, for the first quarter of 2021.

For the quarter ended March 31, 2022, the Company’s return on average assets (“ROAA”) was 1.28%, return on average equity (“ROAE”) was 9.34%, and return on average tangible common equity (“ROATCE”)⁽¹⁾ was 14.66%, compared to 1.63%, 11.90%, and 18.66%, respectively, for the fourth quarter of 2021, and 1.37%, 9.99%, and 16.21%, respectively, for the first quarter of 2021. Total assets increased to $21.62 billion at March 31, 2022, compared to $21.09 billion at December 31, 2021, and $20.17 billion at March 31, 2021.

Steven R. Gardner, Chairman, President, and Chief Executive Officer of the Company, commented, “We delivered a high level of performance in the first quarter driven by strong loan and deposit production. The first quarter's results reflect the success of our technology-driven growth strategy that enhances our new business development efforts, provides a superior banking experience for clients, and optimizes efficiencies and collaboration throughout the organization.

“We generated $1.46 billion in new loan commitments during the first quarter with well-balanced contributions coming from all of our major areas of lending. We also saw positive trends with commercial lines of credit utilization rates increasing in the first quarter. The combination of our strong loan production, increases in line utilization, and slower prepayments resulted in 12.3% annualized loan growth, which we funded with solid inflows of low-cost deposits, which grew 13.4% annualized.

“As always, we continue to prioritize risk management and maintain appropriate levels of capital, liquidity, and reserves in order to effectively manage through the challenges that may arise in connection with higher interest rates, inflationary pressures, and geopolitical uncertainty. During the quarter, we took a number of actions to position the balance sheet for higher interest rates, including reducing the size and duration of the available-for-sale securities portfolio, increasing our liquidity position, and enhancing our asset sensitivity. The strength of the organization we have built and our proactive approach to risk management has enabled us to capitalize on opportunities that arise in stressed environments. We are well positioned to continue to execute our proven business model by effectively managing risk, while growing the franchise both organically and through accretive acquisitions.”

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INCOME STATEMENT HIGHLIGHTS

Net Interest Income and Net Interest Margin

Net interest income totaled $161.8 million in the first quarter of 2022, a decrease of $8.9 million, or 5.2%, from the fourth quarter of 2021. The decrease in net interest income was primarily attributable to lower loan related-fees and lower accretion income as a result of slowing prepayment activity, two fewer days of interest, and lower average investment and loan yields, partially offset by an increase in average earning assets and a favorable remix towards higher yielding loans.

The net interest margin for the first quarter of 2022 was 3.41%, compared with 3.53% in the prior quarter. The core net interest margin⁽¹⁾, which excludes the impact of loan accretion income and other adjustments, decreased 5 basis points to 3.33%, compared to 3.38% in the prior quarter, reflecting lower loan prepayment fees and lower average investment and loan yields, partially offset by the favorable shift in average earning-asset mix.

Net interest income for the first quarter of 2022 increased $187,000, or 0.1%, compared to the first quarter of 2021. The increase was attributable to higher average loan and investment balances, lower cost of funds, primarily due to an improved deposit mix from an $894.6 million increase in average noninterest-bearing checking, and redemptions of higher-cost subordinated debentures, partially offset by lower average interest-earning asset yields.

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Provision for Credit Losses

For the first quarter of 2022, the Company recorded a $448,000 provision expense, compared to a $14.6 million provision recapture for the fourth quarter of 2021, and a $2.0 million provision expense for the first quarter of 2021. The provision expense for the first quarter of 2022 was reflective of higher loans held for investment as well as the impact of growing uncertainties in the macroeconomic environment.

Noninterest Income

Noninterest income for the first quarter of 2022 was $25.9 million, a decrease of $1.4 million from the fourth quarter of 2021. The decrease was primarily due to a $1.5 million decrease in net gain from sales of investment securities and a $560,000 decrease in escrow and exchange fees due to lower transaction volume, partially offset by an $814,000 increase in other income, which included $530,000 higher CRA investment income.

During the first quarter of 2022, the Bank sold $17.8 million of Small Business Administration (“SBA”) loans for a net gain of $1.5 million, compared to the sales of $13.3 million of SBA loans for a net gain of $1.3 million in the fourth quarter of 2021.

Additionally, during the first quarter of 2022, the Bank sold $658.5 million of investment securities for a net gain of $2.1 million, compared to the sales of $267.1 million of investment securities for a net gain of $3.6 million in the fourth quarter of 2021.

Noninterest income for the first quarter of 2022 increased $2.2 million, or 9.1%, compared to the first quarter of 2021. The increase was primarily due to a $4.4 million increase in Trust custodial account fees.

Noninterest Expense

Noninterest expense totaled $97.6 million for the first quarter of 2022, an increase of $396,000 compared to the fourth quarter of 2021, primarily driven by a $990,000 increase in other expense and a $905,000 increase in compensation and benefits.

Noninterest expense increased by $5.2 million compared to the first quarter of 2021. The increase was primarily due to a $4.4 million increase in compensation and benefits.

Income Tax

For the first quarter of 2022, our income tax expense totaled $22.7 million, resulting in an effective tax rate of 25.4%, compared with income tax expense of $30.6 million and an effective tax rate of 26.5% for the fourth quarter of 2021, and income tax expense of $22.3 million and an effective tax rate of 24.5% for the first quarter of 2021. Our estimated effective tax rate for the full year is expected to be in the range of 26% to 27%.

BALANCE SHEET HIGHLIGHTS

Loans

Loans held for investment totaled $14.73 billion at March 31, 2022, an increase of $437.9 million, or 3.1%, from December 31, 2021, and an increase of $1.62 billion, or 12.3%, from March 31, 2021. The increase from December 31, 2021 was primarily driven by loan fundings, higher commercial line utilization rates, and lower levels of prepayments and maturities. Commercial line utilization rates increased to an average of 39.5% for the first quarter of 2022, compared to an average of 35.2% for the fourth quarter of 2021 and 34.1% for the first quarter of 2021.

During the first quarter of 2022, loan commitments totaled $1.46 billion and new loan fundings totaled $1.06 billion, compared with $1.48 billion in loan commitments and $1.07 billion in new loan fundings for the fourth quarter of 2021, and $1.15 billion in loan commitments and $746.3 million in new loan fundings for the first quarter of 2021. The year-over-year increase in new loan fundings was primarily due to expansion in our multifamily, commercial real estate owner-occupied, and commercial and industrial (“C&I”) loan segments.

At March 31, 2022, the total loan-to-deposit ratio was 83.4%, compared with 83.6% and 78.4% at December 31, 2021 and March 31, 2021, respectively.

The following table presents the primary loan roll-forward activities for total loans, including both loans held for investment and loans held for sale, during the quarters indicated:

The following table presents the composition of the loan portfolio as of the dates indicated:

The total end-of-period weighted average interest rate on loans, excluding fees and discounts, at March 31, 2022 was 3.92%, compared to 3.95% at December 31, 2021, and 4.21% at March 31, 2021. The quarter-over- quarter and year-over-year decreases reflect the continued impact from lower levels of prepayments of higher rate loans and lower rates on new originations.

The following table presents the composition of loan commitments originated during the quarters indicated:

The weighted average interest rate on new loan commitments was 3.55% in the first quarter of 2022, compared to 3.55% in the fourth quarter of 2021, and 3.63% in the first quarter of 2021.

Asset Quality and Allowance for Credit Losses

At March 31, 2022, our allowance for credit losses (“ACL”) on loans held for investment was $197.5 million, a decrease of $235,000 from December 31, 2021, and a decrease of $69.5 million from March 31, 2021. The ACL as of March 31, 2022 was reflective of higher loans held for investment as well as the impact of growing uncertainties in the macroeconomic environment. The decrease in ACL from March 31, 2021 was primarily due to favorable changes in the macroeconomic forecasts employed in the Company's current expected credit losses (“CECL”) model related to the COVID-19 pandemic.

During the first quarter of 2022, the Company incurred $446,000 of net charge-offs, compared to $1.0 million of net recoveries during the fourth quarter of 2021 and $1.3 million of net charge-offs during the first quarter of 2021.

The following table provides the allocation of the ACL for loans held for investment as well as the activity in the ACL attributed to various segments in the loan portfolio as of and for the period indicated:

The ratio of allowance for credit losses to loans held for investment at March 31, 2022 was 1.34%, compared to 1.38% at December 31, 2021 and 2.04% at March 31, 2021. The fair value net discount on loans acquired through total bank acquisitions was $71.2 million, or 0.48% of total loans held for investment, as of March 31, 2022, compared to $77.1 million, or 0.54% of total loans held for investment, as of December 31, 2021, and $103.9 million, or 0.79% of total loans held for investment, as of March 31, 2021.

Nonperforming assets totaled $55.3 million, or 0.26% of total assets, at March 31, 2022, compared with $31.3 million, or 0.15% of total assets, at December 31, 2021, and $38.9 million, or 0.19% of total assets, at March 31, 2021. Total loan delinquencies were $43.7 million, or 0.30% of loans held for investment, at March 31, 2022, compared to $19.5 million, or 0.14% of loans held for investment, at December 31, 2021, and $22.6 million, or 0.17% of loans held for investment, at March 31, 2021. The quarter-over-quarter and year-over-year increase in

nonperforming assets and loan delinquencies was primarily due to the addition of a single C&I relationship totaling $25.3 million at March 31, 2022.

Classified loans totaled $122.5 million, or 0.83% of loans held for investment, at March 31, 2022, compared with $121.8 million, or 0.85% of loans held for investment, at December 31, 2021, and $134.7 million, or 1.03% of loans held for investment, at March 31, 2021.

Interest typically is not accrued on loans 90 days or more past due or when, in the opinion of management, there is reasonable doubt as to the timely collection of principal or interest. At March 31, 2022, there was a CRE owner-occupied loan of $1.8 million in default for more than 90 days and still accruing interest, pending a legal proceeding with repayment reasonably expected. There were $16.9 million of troubled debt restructured loans at March 31, 2022, compared with $17.3 million at December 31, 2021, and no troubled debt restructured loans at March 31, 2021.

Investment Securities

At March 31, 2022, available-for-sale (“AFS”) and held-to-maturity (“HTM”) investment securities were $3.22 billion and $996.4 million, respectively, compared to $4.27 billion and $381.7 million, respectively, at December 31, 2021. During the first quarter of 2022, the Company reassessed classification of certain investments with longer duration and transferred a total of $386.8 million of municipal bonds and $255.0 million of mortgage-backed securities, both of which the Company intends and has the ability to hold to maturity, from AFS to HTM at fair value.

In total, investment securities were $4.22 billion at March 31, 2022, a decrease of $437.1 million from December 31, 2021, and an increase of $339.2 million from March 31, 2021. The decrease in the first quarter of 2022 compared to the prior quarter was primarily the result of $658.5 million in investment securities sales, $109.3 million in principal payments, discounts from the AFS securities transferred to HTM, amortizations, and redemptions, as well as a $168.1 million decrease in mark-to-market fair value adjustment, partially offset by $498.9 million in investment securities purchases.

The increase in investment securities from March 31, 2021 was primarily the result of $2.40 billion in purchases, partially offset by $1.37 billion in sales, $542.9 million in principal payments, amortization, and redemptions, and a $151.5 million decrease in mark-to-market fair value adjustment.

Deposits

At March 31, 2022, deposits totaled $17.69 billion, an increase of $573.6 million, or 3.4%, from December 31, 2021, and an increase of $949.2 million, or 5.7%, from March 31, 2021. At March 31, 2022, non-maturity deposits totaled $16.66 billion, or 94.2% of total deposits, an increase of $600.9 million, or 3.7%, from December 31, 2021, and an increase of $1.29 billion, or 8.4%, from March 31, 2021. During the first quarter of 2022, deposit increases included $349.3 million in noninterest-bearing checking deposits, $185.7 million in interest- bearing checking deposits, and $65.9 million in money market and savings deposits, partially offset by a planned decrease of $27.3 million in retail certificates of deposits, as compared to the fourth quarter of 2021. The increase in deposits from March 31, 2021 was primarily driven by an increase in business checking deposits, partially offset by decreases in certificates of deposit and money market/savings deposits.

The weighted average cost of deposits for the first quarter of 2022 remained unchanged at 0.04%, compared to the fourth quarter of 2021, and decreased from 0.11% for the first quarter of 2021.

The end of period weighted average rate of deposits at March 31, 2022 was 0.04%.

Borrowings

At March 31, 2022, total borrowings amounted to $930.7 million, an increase of $42.2 million from December 31, 2021, and an increase of $419.1 million from March 31, 2021. Total borrowings at March 31, 2022 were comprised of $600.0 million of Federal Home Loan Bank of San Francisco (“FHLB”) advances and $330.7 million of subordinated debt. The increase in borrowings at March 31, 2022 as compared to December 31, 2021 was primarily due to an increase of $600.0 million in FHLB term advances, offset by repayment of $550.0 million in FHLB overnight advances and $8.0 million in other short-term borrowings. The increase in borrowings at

March 31, 2022 as compared to March 31, 2021 was primarily due to an increase of $590.0 million in FHLB advances, partially offset by redemptions of $160.0 million in subordinated notes and $10.4 million junior subordinated debt securities. At March 31, 2022, total borrowings represented 4.3% of total assets, compared to 4.2% and 2.5% as of December 31, 2021 and March 31, 2021, respectively.

Capital Ratios

At March 31, 2022, our common stockholder's equity was $2.78 billion, or 12.87% of total assets, compared with $2.89 billion, or 13.68%, at December 31, 2021, and $2.70 billion, or 13.40%, at March 31, 2021, with a book value per share of $29.31, compared with $30.58 at December 31, 2021, and $28.56 at March 31, 2021. At March 31, 2022, our ratio of tangible common equity to tangible assets⁽¹⁾ was 8.79%, compared with 9.52% at December 31, 2021, and 8.97% at March 31, 2021, and our tangible book value per share⁽¹⁾ was $19.12, compared with $20.29 at December 31, 2021, and $18.19 at March 31, 2021. The decreases in the ratio of tangible common equity to tangible assets and tangible book value per share at March 31, 2022 from the prior quarter were primarily driven by the other comprehensive loss from the impact of higher interest rates on our AFS securities portfolio.

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The Company implemented the CECL model on January 1, 2020 and elected to phase in the full effect of CECL on regulatory capital over the five-year transition period. Beginning the first quarter of March 31, 2022, the Company phases into regulatory capital the cumulative adjustments at the end of the second year of the transition period at 25% per year. At March 31, 2022, the Company and Bank are in compliance with the capital conservation buffer requirement and exceeded the minimum Common Equity Tier 1, Tier 1, and total capital ratios, inclusive of the fully phased-in capital conservation buffer, of 7.0%, 8.5% and 10.5%, respectively, and the Bank qualified as “well-capitalized” for purposes of the federal bank regulatory prompt corrective action regulations.

Dividend and Stock Repurchase Program

On April 22, 2022, the Company's Board of Directors declared a $0.33 per share dividend, payable on May 13, 2022 to stockholders of record as of May 6, 2022. In January 2021, the Company’s Board of Directors approved a stock repurchase program, which authorized the repurchase of up to 4,725,000 shares of its common stock. During the first quarter of 2022, the Company did not repurchase any shares of common stock.

Conference Call and Webcast

The Company will host a conference call at 9:00 a.m. PT / 12:00 p.m. ET on April 26, 2022 to discuss its financial results. Analysts and investors may participate in the question-and-answer session. A live webcast will be available on the Webcasts page of the Company's investor relations website. An archived version of the webcast will be available in the same location shortly after the live call has ended. The conference call can be accessed by telephone at (866) 290-5977 and asking to be joined to the Pacific Premier Bancorp conference call. Additionally, a telephone replay will be made available through May 3, 2022, at (877) 344-7529, conference ID 5702244.

About Pacific Premier Bancorp, Inc.

Pacific Premier Bancorp, Inc. (Nasdaq: PPBI) is the parent company of Pacific Premier Bank, a California- based commercial bank focused on serving small, middle-market, and corporate businesses throughout the western United States in major metropolitan markets in California, Washington, Oregon, Arizona, and Nevada. Founded in 1983, Pacific Premier Bank has grown to become one of the largest banks headquartered in the western region of the United States, with over $21 billion in total assets. Pacific Premier Bank provides banking products and services, including deposit accounts, digital banking, and treasury management services, to businesses, professionals, entrepreneurs, real estate investors, and nonprofit organizations. Pacific Premier Bank also offers a wide array of loan products, such as commercial business loans, lines of credit, SBA loans, commercial real estate loans, agribusiness loans, franchise lending, home equity lines of credit, and construction loans. Pacific Premier Bank offers commercial escrow services and facilitates 1031 Exchange transactions through its Commerce Escrow division. Pacific Premier Bank offers clients IRA custodial services through its Pacific Premier Trust division, which has approximately $18 billion of assets under custody and over 42,000 client accounts comprised of self- directed investors, financial institutions, capital syndicators, and financial advisors. Additionally, Pacific Premier Bank provides nationwide customized banking solutions to Homeowners’ Associations and Property Management companies. Pacific Premier Bank is an Equal Housing Lender and Member FDIC. For additional information about Pacific Premier Bancorp, Inc. and Pacific Premier Bank, visit our website: www.ppbi.com.

FORWARD-LOOKING STATEMENTS

The statements contained herein that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company including, without limitation, plans, strategies and goals, and statements about the Company’s expectations regarding revenue and asset growth, financial performance and profitability, loan and deposit growth, yields and returns, loan diversification and credit management, stockholder value creation, tax rates, and the impact of acquisitions we have made or may make.

Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Company. There can be no assurance that future developments affecting the Company will be the same as those anticipated by management. The Company cautions readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. Given the ongoing and dynamic nature of the COVID-19 pandemic, the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects remain uncertain. Continued deterioration in general business and economic conditions, including further increases in unemployment rates, or turbulence in domestic or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding, lead to a tightening of credit, and further increase stock price volatility, which could result in impairment to our goodwill in future periods. In addition, changes to statutes, regulations, or regulatory policies or practices as a result of, or in response to the COVID-19 pandemic, could affect us in substantial and unpredictable ways, including the potential adverse impact of loan modifications and payment deferrals implemented consistent with recent regulatory guidance. Other risks and uncertainties include, but are not limited to, the following: the strength of the United States economy in general and the strength of the local economies in which we conduct operations; the effects of, and changes in, trade, monetary, and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation/deflation, interest rate, market, and monetary fluctuations; the effect of acquisitions we have made or may make, including, without limitation, the failure to achieve the expected revenue growth and/or expense savings from such acquisitions, and/or the failure to effectively integrate an acquisition target into our operations; the timely development of competitive new products and services and the acceptance of these products and services by new and existing customers; the impact of changes in financial services policies, laws, and regulations, including those concerning taxes, banking, securities, and insurance, and the application thereof by regulatory bodies; the effectiveness of our risk management framework and quantitative models; changes in the level of our nonperforming assets and charge-offs; the transition away from USD LIBOR and related uncertainty as well as the risk and costs related to our adoption of SOFR; the effect of changes in accounting policies and practices or accounting standards, as may be adopted from time-to-time by bank regulatory agencies, the U.S. Securities and Exchange Commission (“SEC”), the Public Company Accounting Oversight Board, the Financial Accounting Standards Board or other accounting standards setters, including ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments,” commonly referenced as the CECL model, which has changed how we estimate credit losses and may further increase the required level of our allowance for credit losses in future periods; possible credit related impairments of securities held by us; possible impairment charges to goodwill; the impact of governmental efforts to restructure the U.S. financial regulatory system; changes in consumer spending, borrowing, and savings habits; the effects of our lack of a diversified loan portfolio, including the risks of geographic and industry concentrations; our ability to attract deposits and other sources of liquidity; the possibility that we may reduce or discontinue the payments of dividends on our common stock; the possibility that we may discontinue our stock repurchase program or reduce or otherwise limit the level of repurchases of our common stock we may make from time to time pursuant to such program; changes in the financial performance and/or condition of our borrowers; changes in the competitive environment among financial and bank holding companies and other financial service providers; geopolitical conditions, including acts or threats of terrorism, actions taken by the United States or other governments in response to acts or threats of terrorism, and/or military conflicts, including the war between Russia and Ukraine, which could impact business and economic conditions in the United States and abroad; public health crisis and pandemics, including the COVID-19 pandemic, and their effects on the economic and business environments in which we operate, including on our credit quality and business operations, as well as the impact on general economic and financial market conditions; cybersecurity threats and the cost of defending against them; climate change, including the enhanced regulatory, compliance, credit and reputational risks and costs; natural disasters, earthquakes, fires, and severe weather; unanticipated regulatory or legal proceedings; and our ability to manage the risks involved in the foregoing. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the Company's 2021 Annual Report on Form 10-K filed with the SEC and available at the SEC’s Internet site (http://www.sec.gov).

The Company undertakes no obligation to revise or publicly release any revision or update to these forward- looking statements to reflect events or circumstances that occur after the date on which such statements were made.

SELECTED FINANCIAL DATA