Sierra Bancorp (BSRR): History, Ownership, Mission, How It Works & Makes Money

Sierra Bancorp (BSRR) has navigated a challenging regional banking environment, but is this California-based institution a defensive value play or a growth laggard you should be watching?

As of the first nine months of 2025, the bank holding company reported a consolidated net income of $29.4 million and a strong third-quarter efficiency ratio of 58.0%, demonstrating solid operational control.

Given its stock trades near $27.61 and its tangible book value per share hit $24.66 in Q3, we'll cut through the noise to analayze how its core mission and revenue model-primarily driven by its Bank of the Sierra subsidiary-translate into a clear path for maximizing your returns.

Sierra Bancorp (BSRR) History

Sierra Bancorp's story is one of consistent, community-focused expansion from a single-branch operation in California's Central Valley. The company, which is the holding company for Bank of the Sierra, was built on a foundation of local banking, gradually expanding its footprint through both organic growth and strategic acquisitions to become a regional player with over $3.7 billion in assets as of late 2024.

Given Company's Founding Timeline

Year established

The subsidiary, Bank of the Sierra, was incorporated in September 1977 and opened for business in January 1978. Sierra Bancorp was formally established as the bank holding company in 2001.

Original location

Porterville, California.

Founding team members

A key founding figure was James C. Holly, who served as a founding Director and Vice Chairman of the Board for both the Bank and Sierra Bancorp. He also led the Bank as its President and Chief Executive Officer from its formation in 1977 until January 1, 2014.

Initial capital/funding

The original Bank of the Sierra opened its doors with $1.5 million in capital, a modest sum that anchored its start as a one-branch community bank.

Given Company's Evolution Milestones

Given Company's Transformative Moments

The most transformative shifts for Sierra Bancorp have centered on its calculated expansion strategy and its recent focus on capital efficiency.

The decision to pursue whole-bank acquisitions in the mid-2010s fundamentally changed the company's scale and risk profile. The 2016 Coast Bancorp and 2017 OCB Bancorp deals were pivotal. The OCB acquisition, for instance, expanded the bank's reach from the Central Valley to the more affluent Ventura County market. This move diversified the loan portfolio and deposit base, moving away from being solely reliant on its South San Joaquin Valley roots. That's how a small-town bank gets regional scale without losing its community focus, defintely a smart play.

More recently, the strategic focus has been on optimizing the balance sheet and returning value to shareholders, a necessary pivot in a high-interest-rate environment.

• Balance Sheet Optimization (2024): In early 2024, the company executed a securities strategy, selling $196.7 million of lower-yielding bonds to pay down higher-cost short-term borrowings, improving future net interest income.
• Asset Rationalization (2023/2024): The sale of 13 branches in two tranches, starting in late 2023, generated a gain of $15.3 million on the first tranche alone, streamlining the branch network for efficiency.
• Capital Return (2025): Through the first nine months of 2025, the company repurchased 802,753 shares of common stock, which directly contributed to the increase in diluted earnings per share to $2.15.

This shift-from aggressive branch expansion via M&A to disciplined balance sheet management and capital return-shows a mature financial institution adapting to market conditions. You can read more about the company's ownership structure and investor sentiment in Exploring Sierra Bancorp (BSRR) Investor Profile: Who's Buying and Why?

Sierra Bancorp (BSRR) Ownership Structure

You need to know who is really calling the shots at Sierra Bancorp, and the structure is clear: institutional investors hold the majority, but the company's public status means transparency is key for all stakeholders.

This California-based bank holding company is governed by a mix of large financial institutions, internal leadership, and a significant base of individual investors, which creates a balanced, though defintely not static, governance environment.

Sierra Bancorp's Current Status

Sierra Bancorp is a publicly traded entity, listed on the NASDAQ Global Select Market under the ticker symbol BSRR. This status means the company is subject to rigorous regulatory oversight by the Securities and Exchange Commission (SEC), providing you with a high degree of financial transparency.

As of November 2025, the company commands a market capitalization (market cap) of approximately $391.63 million, placing it firmly in the small-cap regional bank category. This size means the stock can be more sensitive to regional economic shifts, plus the actions of major institutional holders carry more weight than in a mega-cap bank. You can find more on the company's strategic direction here: Mission Statement, Vision, & Core Values of Sierra Bancorp (BSRR).

Sierra Bancorp's Ownership Breakdown

The ownership structure is typical for a regional bank of this size: institutions control the largest block of shares, but insiders maintain a meaningful stake, aligning their interests with long-term performance. Here's the quick math on who owns the equity as of the 2025 fiscal year data:

What this estimate hides is the power of that 58.64% institutional block. They are the swing vote on major corporate actions, so monitoring their quarterly 13F filings is a critical action for any serious investor.

Sierra Bancorp's Leadership

The company is steered by a seasoned executive team and an experienced board, with the management team averaging a tenure of 5.8 years. This stability is a good sign, but you need to be aware of the finance leadership transition happening right now.

• Kevin McPhaill serves as the President and Chief Executive Officer (CEO), a role he has held since January 2014, giving him nearly 12 years of leadership experience at the top.
• Morris Tharp is the Independent Chairman of the Board, overseeing corporate governance and strategic direction.
• Christopher Treece is the Executive Vice President and Chief Financial Officer (EVP & CFO). He will assume the additional, crucial role of Principal Accounting Officer on January 5, 2026, following the retirement of Cindy Dabney.
• William Wade II was appointed Executive Vice President and Chief Operations Officer (COO), effective July 7, 2025, a key move to streamline operations.

The consolidation of the CFO and Principal Accounting Officer roles under Mr. Treece, effective early next year, centralizes financial reporting oversight. This can streamline decision-making, but it also concentrates significant responsibility, which is something to watch closely.

Sierra Bancorp (BSRR) Mission and Values

Sierra Bancorp's purpose extends beyond standard banking metrics, centering its mission on deep community involvement and a culture of continuous improvement, which is why their subsidiary, Bank of the Sierra, has awarded over $3 million in local nonprofit grants. This commitment is a core part of their strategy, which helped drive a consolidated net income of $29.4 million for the first nine months of 2025.

Given Company's Core Purpose

The company's cultural DNA is built around a set of 'Seven Key Strategies' that guide everything from product development to community reinvestment (Keep Giving). This framework is how they deliver on their promise to customers and shareholders, resulting in a Q3 2025 efficiency ratio of 58.0%. Honestly, community banks live and die by trust, and their actions in the Central Valley reflect that.

• Keep Thinking: Anticipate and meet customer needs with a broad range of solutions.
• Keep Serving: Provide quality service on a timely, competitive basis.
• Keep Learning: Be passionate about being the right person on the team.
• Keep Growing: Encourage creativity and maximize every opportunity to improve.
• Keep Giving: Serve our communities through involvement and reinvestment.

Official mission statement

While Sierra Bancorp (BSRR) does not publish a single, formal mission statement, its operating principle is to be the leading, service-oriented community bank in California's South-Central Valley. The core pledge is to help improve every community it serves, ensuring that financial success and local welfare are defintely linked.

• Be the leading community bank in California's South-Central Valley.
• Maintain a reputation as a service-oriented and customer-focused community bank.
• Help make every community we're part of better.

Vision statement

The company's vision is focused on long-term, responsible growth and maximizing shareholder value while maintaining a strong capital base. The tangible book value per share increased to $24.66 by the third quarter of 2025, which shows their focus on tangible growth. This financial discipline supports the long-term vision of being a stable, growing regional partner.

• Achieve strong profitability and long-term growth.
• Maintain a strong capital base, such as the 11.73% regulatory leverage ratio for the subsidiary bank in Q3 2025.
• Sustain a culture that is disciplined, aims for excellence, and enjoys the journey.

For a deeper dive into the company's fiscal standing, you should read Breaking Down Sierra Bancorp (BSRR) Financial Health: Key Insights for Investors.

Given Company slogan/tagline

The most consistent and public-facing statement that functions as a tagline for Bank of the Sierra, the primary engine of Sierra Bancorp, is directly tied to its community promise.

• Helping You & Your Community Grow.

Sierra Bancorp (BSRR) How It Works

Sierra Bancorp, operating as Bank of the Sierra, works by serving as a classic community bank: it gathers low-cost core deposits from individuals and local businesses in California's South-Central Valley and then redeploys that capital into higher-yielding loans, primarily real estate and commercial credit. This simple but defintely effective model generates the net interest income (NII) that drives their profitability.

The company's primary value creation comes from managing the spread between the interest earned on its loan portfolio and the interest paid on its deposits and borrowings, a measure called the net interest margin (NIM), which stood at a healthy 3.78% in the third quarter of 2025.

Given Company's Product/Service Portfolio

Given Company's Operational Framework

The operational framework is built on a decentralized, community-focused banking model supported by centralized risk management and capital allocation. This structure allows local branch managers to make faster decisions while maintaining a strong balance sheet.

• Deposit-Driven Funding: The bank's priority is growing non-brokered, core customer deposits, which are a cheaper, more stable source of funds than wholesale markets. Customer deposits increased by $43.2 million in the first quarter of 2025, even as they proactively reduced higher-cost brokered deposits by $85.0 million.
• Credit Risk Management: They maintain a prudent lending stance, evidenced by the ratio of total nonperforming loans to total gross loans improving to 0.56% in Q3 2025. They are actively managing their credit-loss reserves (allowance for loan losses or ACL) which stood at 1.34% of total loans as of a recent 2025 report.
• Efficiency Focus: The company is highly focused on cost control, which is critical in a competitive regional market. Their efficiency ratio-which measures non-interest expense as a percentage of revenue-improved to 58.0% in the third quarter of 2025. That's a clean number for a regional bank.

For a deeper look at the underlying health, you should be Breaking Down Sierra Bancorp (BSRR) Financial Health: Key Insights for Investors.

Given Company's Strategic Advantages

Sierra Bancorp's market success isn't about complex financial engineering; it's about a deep regional presence and disciplined capital management, which creates a defensive moat in a volatile sector.

• Geographic Concentration & Community Focus: With 35 branches concentrated in California's South-Central Valley, the company benefits from a strong local brand and deep relationships that are hard for larger national banks to replicate. This focus supports their stable, low-cost core deposit base.
• Superior Capital Strength: The bank maintains capital levels well above regulatory minimums. The subsidiary bank's Community Bank Leverage Ratio (CBLR) was a robust 11.73% as of September 30, 2025, which provides a significant buffer against economic downturns and supports future growth.
• Disciplined Capital Return: Management consistently returns capital to shareholders, signaling confidence and supporting the stock price. The company declared a quarterly dividend of $0.25 per share in Q3 2025 and repurchased 190,342 shares of common stock during that same quarter.

Here's the quick math: With a tangible book value per share of $24.66 as of Q3 2025, the stock repurchases are accretive (immediately adding value) when the stock trades below that level, which is a smart use of capital.

Sierra Bancorp (BSRR) How It Makes Money

Sierra Bancorp, through its subsidiary Bank of the Sierra, operates on the classic community bank model: they primarily make money by borrowing funds from depositors at a lower interest rate and lending that money out at a higher rate, a process known as net interest income.

The company also generates a significant portion of its revenue from non-interest activities, such as service charges, fees on loans and deposits, and wealth management services, diversifying its income stream beyond just loan performance.

Sierra Bancorp's Revenue Breakdown

For the third quarter of 2025 (Q3 2025), Sierra Bancorp reported total revenue of $40.03 million. The revenue mix confirms its reliance on core lending activities, though non-interest income remains a critical component for stability.

Here's the quick math: Net Interest Income was $32.0 million in Q3 2025. That leaves $8.03 million for Non-Interest Income, which is about one-fifth of the total revenue.

Business Economics

A bank's financial engine lives and dies by its ability to manage its interest rate spread. Sierra Bancorp's core economic strategy revolves around maximizing its Net Interest Margin (NIM) while keeping its cost of funds low and maintaining strong asset quality.

• Net Interest Margin (NIM): The NIM is the single most important metric, showing the difference between interest earned on loans and interest paid on deposits and borrowings. In Q3 2025, Sierra Bancorp improved its NIM to 3.78%, up from 3.68% in the prior quarter. This increase was driven by an improved loan yield of 5.36%.
• Cost of Funds: The bank has done a defintely good job managing deposit costs, with the cost of funds decreasing to 1.45% in Q3 2025. This is key in a tough interest rate environment.
• Noninterest-Bearing Deposits: These are essentially free funding for the bank. As of September 30, 2025, noninterest-bearing deposits represented a strong 37% of total deposits, providing a significant structural advantage over banks that rely more heavily on high-cost, interest-bearing accounts.
• Loan Portfolio Growth: The lending business is expanding, with gross loans increasing by $57.2 million in Q3 2025, an annualized growth rate of 9%. This growth, especially in real estate, commercial, and agricultural loans, is the primary driver of the Net Interest Income stream.

The business model is simple: source cheap, sticky deposits from the community and deploy that capital into higher-yielding loans, particularly in the Central California region where they have a long-standing presence.

Sierra Bancorp's Financial Performance

The latest financial results, covering the first nine months of 2025, show a company focused on efficiency and capital strength, even as net income saw a slight year-over-year decline due to factors like increased provision for credit losses.

• Net Income and EPS: Consolidated net income for Q3 2025 was $9.7 million. Diluted Earnings Per Share (EPS) for the first nine months of 2025 increased to $2.15, up 3% from the same period in 2024, largely due to continued stock repurchases.
• Efficiency Ratio: An improved Efficiency Ratio of 58.0% in Q3 2025, down from 59.4% in the prior quarter, shows the bank is getting better at managing operating expenses relative to revenue. Lower is better here.
• Return on Assets (ROAA) and Equity (ROAE): For the first nine months of 2025, the annualized Return on Average Assets was 1.07%, and Return on Average Equity was 11.11%. These are solid, though slightly lower than 2024, indicating effective use of shareholder capital and assets.
• Tangible Book Value (TBV): TBV per share is a key measure of intrinsic value for a bank. It increased 3% during Q3 2025 to $24.66 per share. This is a clean one-liner for value investors.
• Asset Quality: The ratio of total nonperforming loans to total gross loans improved to a healthy 0.56% in Q3 2025, reflecting solid credit underwriting.

For a deeper dive into who is betting on these fundamentals, you should check out Exploring Sierra Bancorp (BSRR) Investor Profile: Who's Buying and Why?

Sierra Bancorp (BSRR) Market Position & Future Outlook

Sierra Bancorp is positioned as a defensively stable, value-oriented regional bank, leveraging its deep community ties in California's Central Valley to drive consistent earnings and a strong dividend yield. As of late 2025, the company focuses on capital efficiency and organic loan growth, which is reflected in a Q3 2025 net income of $9.7 million and an improved efficiency ratio of 58.0%.

The company's strategy is to maintain a high-quality balance sheet while capitalizing on its local market dominance, even as its overall growth projections of 3.4% for annual revenue and 3.6% for earnings trail the broader US market averages. [cite: 15 in second search block]

Competitive Landscape

In the highly fragmented California regional banking market, Sierra Bancorp (BSRR) competes by being the definitive local leader in its core operating area, a strategy that insulates it from the larger, multi-state institutions. While major banks like Wells Fargo and Bank of America dominate the state overall, BSRR's localized, relationship-based model gives it a critical edge in the Central Valley.

Note: Sierra Bancorp's 5.4% market share is based on the combined deposits across the 25 cities where it maintains branches (as of June 30, 2024). Banc of California's market share is an approximation based on its total assets relative to the larger Southern California market and its recent merger with PacWest, giving it a much larger asset base of $33.5 billion. [cite: 3 in second search block]

Opportunities & Challenges

You're looking at a bank that is defensively positioned, so its opportunities are less about aggressive expansion and more about capital return and efficiency gains. That's a good thing in this rate environment.

Industry Position

Sierra Bancorp is a strong community bank, not a major regional player, but that local focus is its moat (competitive advantage). It holds a commanding position in its home county, ranking first in deposit market share in Tulare County.

• Maintain a strong capital buffer: The regulatory Community Bank Leverage Ratio was a robust 11.75% in Q2 2025, giving it a cushion against economic volatility.
• Prioritize noninterest-bearing deposits: These low-cost funds accounted for 36% of total deposits at the end of Q2 2025, which is key to maintaining a healthy net interest margin.
• Focus on operational efficiency: The efficiency ratio has improved to 58.0% in Q3 2025, showing management is controlling costs effectively. [cite: 2 in first search block]
• Continue the strategic shift: Management is actively reducing higher-cost brokered deposits, a move that directly supports the improved NIM. [cite: 9 in third search block]

To understand the foundation of this stability, you should review the Mission Statement, Vision, & Core Values of Sierra Bancorp (BSRR).