BayCom Corp Commitments Disclosure
15. COMMITMENTS AND CONTINGENCIES
Lending and Letter of Credit Commitments
In the normal course of business, the Company enters into various commitments to extend credit which are not reflected in the financial statements. These commitments consist of the undisbursed balance on personal and commercial lines of credit, including commercial real estate secured lines of credit, and of the undisbursed funds on construction and development loans. The Company also issues standby letter of credit commitments, primarily for the third-party performance obligations of clients.
The following table presents a summary of commitments described above as of the dates indicated:
| December 31, | | December 31, | |||
2025 | 2024 | |||||
Commitments to extend credit | $ | 67,060 | $ | 72,737 | ||
Standby letters of credit |
| 477 |
| 677 | ||
Total commitments | $ | 67,537 | $ | 73,414 | ||
Commitments generally have fixed expiration dates or other termination clauses. The actual liquidity needs or credit risk that the Company will experience will be lower than the contractual amount of commitments to extend credit because a significant portion of these commitments are expected to expire without being drawn upon. The commitments are generally variable rate and include unfunded home equity lines of credit, commercial real estate construction loans whereby disbursement is made over the course of construction, commercial revolving lines of credit, and unsecured personal lines of credit. The Company’s outstanding loan commitments are made using the same underwriting standards as comparable outstanding loans. The reserve associated with these commitments included in interest payable and other liabilities on the consolidated balance sheets was $410,000 and $600,000 at December 31, 2025 and 2024, respectively.
Commercial Real Estate Concentrations
At December 31, 2025 and 2024, in management’s judgment, a concentration of loans existed in commercial real estate related loans. The Company’s commercial real estate loans are secured by owner-occupied and non-owner occupied commercial real estate and multifamily properties. Although management believes that loans within these concentrations have no more than the normal risk of collectability, a decline in the performance of the economy in general or a decline in real estate values in the Company’s primary market areas in particular could have an adverse impact on collectability.
Other Assets
The Company has commitments to fund investments in LIHTC partnerships and an SBIC fund. At December 31, 2025, the remaining commitments to the LIHTC partnerships and SBIC fund were approximately $4.7 million and $122,000, respectively. At December 31, 2024, the remaining commitment to the LIHTC partnerships and SBIC fund were $4.9 million and $122,000, respectively.
Deposits
At December 31, 2025, approximately $235.8 million, or 11.7%, of the Company’s deposits were derived from its top ten depositors. At December 31, 2024, approximately $304.5 million, or 13.6% of the Company’s deposits were derived from the top ten depositors.
Local Agency Deposits
In the normal course of business, the Company accepts deposits from local agencies. The Company is required to provide collateral for certain local agency deposits in the states of California, Colorado, New Mexico and Washington. As of December 31, 2025 and 2024, the FHLB issued letters of credit on behalf of the Company totaling $41.6 million and $41.1 million, respectively, as collateral for local agency deposits.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 16, 2026 | Showing above |
| 2024 | Mar 14, 2025 | |
| 2023 | Mar 15, 2024 | |
| 2022 | Mar 31, 2023 | |
| 2021 | Mar 31, 2022 | |
| 2020 | Mar 23, 2021 | |
| 2019 | Mar 16, 2020 | |
| 2018 | Mar 19, 2019 | |
About Commitments Disclosures
Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.
Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.