Q1 2017 Highlights:

  • New loan originations total $587.4 million, up 26% over 4Q 2017
  • Total deposits increase to $10.70 billion, notwithstanding the consolidation of 12 branches at year-end 2016
  • Signed definitive agreement to acquire Seattle-based U & I Financial Corp.
  • Net income totals $37.0 million, or $0.27 per diluted common share, including merger-related expenses of $947,000

LOS ANGELES, April 27, 2017 (GLOBE NEWSWIRE) — Hope Bancorp, Inc. (the “Company”) (NASDAQ:HOPE), the holding company of Bank of Hope (the “Bank”), today reported unaudited financial results for three months ended March 31, 2017.

The mergers of Wilshire Bancorp, Inc. (“Wilshire”) with and into BBCN Bancorp, Inc. (“BBCN”) and Wilshire Bank with and into BBCN Bank were completed on July 29, 2016, and the combined company began operations under the new banners of Hope Bancorp, Inc. and Bank of Hope effective July 30, 2016.  The 2017 first quarter and 2016 fourth quarter financial results reflect the full quarters of combined operations following the completion of the merger.  The 2016 first quarter reflects stand-alone operations of the former BBCN.  As a result, the Company’s 2017 first quarter may not be comparable to financial results for the year-ago first quarter.

For the three months ended March 31, 2017, net income totaled $37.0 million, or $0.27 per diluted common share, based on 135,689,816 weighted average diluted shares outstanding, and included pre-tax merger-related expenses of $947,000.  This compares with 2016 fourth quarter net income of $40.6 million, or $0.30 per diluted common share, based on 135,585,561 weighted average diluted shares outstanding, and included $3.0 million in merger-related expenses.  For the 2016 first quarter, net income totaled $23.6 million, or $0.30 per diluted common share, based on 79,613,245 weight average diluted shares outstanding, and included merger-related expenses of $1.2 million.  Excluding the merger-related expenses, core net income would have been $37.5 million, or $0.28 per diluted common share, for the 2017 first quarter, $42.4 million, or $0.31 per diluted common share, for the preceding 2016 fourth quarter, and $24.3 million, or $0.31 per diluted common share, for the 2016 first quarter.

Net income excluding pre-tax merger-related expenses is a non-GAAP financial measure.  Management reviews net income excluding merger-related expenses in evaluating the Company’s overall evaluation of its performance and has included this financial metric in response to market participant interest in the Company’s core earnings performance.  The accompanying financial information includes a reconciliation of core net income and earnings per share excluding merger-related expenses.

“Hope Bancorp’s 2017 first quarter results demonstrate the meaningful progress we have made on the integration of our merger of equals completed last year and capturing the synergies that we projected,” said Kevin S. Kim, President and Chief Executive Officer. “Despite the seasonally slow first quarter, we were able to significantly increase our loan production across all of our lending areas. We originated $587 million in new loans during the first quarter, which amounted to a 26% increase from the preceding quarter, and improved loan pricing contributed to a 2 basis point improvement in our net interest margin. The cost saves following the completion of the first phase of branch consolidations at the end of 2016 are evident in our lower levels of noninterest expenses associated with our branch operations. Notwithstanding those branch closures, we are pleased to report core deposits increased by $117 million, or 7% on an annualized basis.

“Our financial results, however, were adversely impacted by several unusual expense items and elevated credit costs associated with our OREO portfolio and nonperforming loans. While we are disappointed that our earnings came in lighter than expected this quarter, we are confident that the results are not indicative of the future performance of the Company and that the initiatives we are taking today further strengthen our Bank’s prospects for the long term. We look forward to keeping our shareholders, employees and customers apprised of our ongoing progress and achievements,” said Kim.

Financial Highlights

(dollars in thousands, except per share data) (unaudited) At or for the Three Months Ended
  3/31/2017   12/31/2016   3/31/2016
Net income $ 36,960     $ 40,630     $ 23,623  
Diluted earnings per share $ 0.27     $ 0.30     $ 0.30  
Net interest income before provision for loan losses $ 114,905     $ 117,209     $ 71,607  
Net interest margin   3.77 %     3.75 %     3.84 %
Noninterest income $ 17,603     $ 18,192     $ 8,775  
Noninterest expense $ 66,293     $ 66,731     $ 40,049  
Net loans receivable $ 10,471,008     $ 10,463,989     $ 6,295,079  
Deposits $ 10,703,777     $ 10,642,035     $ 6,467,411  
Nonaccrual loans (1) $ 37,009     $ 40,074     $ 43,548  
ALLL to loans receivable   0.75 %     0.75 %     1.21 %
ALLL to nonaccrual loans (1)   212.54 %     197.99 %     176.49 %
ALLL to nonperforming assets (1) (2)   74.65 %     71.32 %     66.17 %
Provision for loan losses $ 5,600     $ 800     $ 500  
Net charge offs $ 6,284     $ 1,433     $ 52  
ROA   1.11 %     1.20 %     1.20 %
ROE   7.91 %     8.72 %     9.99 %
Efficiency ratio   50.03 %     49.28 %     49.82 %

(1) Excludes delinquent SBA loans that are guaranteed and currently in liquidation totaling $15.2 million, $15.9 million, and $15.4 million at March 31, 2017, December 31, 2016 and March 31, 2016, respectively.
(2) Nonperforming assets exclude purchased credit-impaired loans totaling $17.3 million, $19.6 million and $13.1 million at March 31, 2017, December 31, 2016 and March 31, 2016, respectively.

Operating Results for the 2017 First Quarter

The comparability of Hope Bancorp’s operating results with past performance is impacted by acquisition accounting adjustments and merger-related expenses associated with past and current acquisitions.  The Company provides the following supplemental information to facilitate a better understanding of financial performance.  Net interest income and operating income for the three months ended March 31, 2017, December 31, 2016 and March 31, 2016 include the following pre-tax acquisition accounting adjustments and merger-related expenses associated with past and current acquisitions:

(dollars in thousands) (unaudited) Three Months Ended
  3/31/2017   12/31/2016   3/31/2016
Accretion on purchased non-impaired loans $ 2,676     $ 3,355     $ 1,966  
Accretion on purchased credit-impaired loans   2,084       2,182       1,965  
Amortization of premium on low income housing tax credits   (84 )     (84 )      
Amortization of premium on acquired FHLB borrowings   441       449       97  
Accretion of discount on acquired subordinated debt   (259 )     (260 )     (44 )
Amortization of premium on acquired time deposits and savings   3,476       3,478       24  
Total acquisition accounting adjustments $ 8,334     $ 9,120     $ 4,008  
Merger-related expenses   (947 )     (2,952 )     (1,207 )
Total $ 7,387     $ 6,168     $ 2,801  
                       

Net Interest Income and Net Interest Margin.  Net interest income before provision for loan losses for the 2017 first quarter totaled $114.9 million, compared with $117.2 million in the preceding 2016 fourth quarter. In the year-ago first quarter, net interest income before provision for loan losses amounted to $71.6 million for BBCN on a stand-alone basis.

The net interest margin (net interest income divided by average interest earning assets) and the impact of acquisition accounting adjustments are summarized in the following table:

  Three Months Ended
  3/31/2017   12/31/2016   change   3/31/2016   change
Net interest margin, excluding the effect of acquisition accounting adjustments 3.49 %   3.45 %   0.04     3.58 %   (0.09 )
Acquisition accounting adjustments 0.28 %   0.30 %   (0.02 )   0.26 %   0.02  
Net interest margin 3.77 %   3.75 %   0.02     3.84 %   (0.07 )
                             

The net interest margin for the 2017 first quarter increased 2 basis points from the preceding fourth quarter, or 4 basis points on a core basis, excluding the effect of acquisition accounting adjustments. Compared with the year-ago first quarter, net interest margin decreased 7 basis points, or 9 basis points on a core basis.

The weighted average yield on loans and the impact of acquisition accounting adjustments are summarized in the following table:

  Three Months Ended
  3/31/2017   12/31/2016   change   3/31/2016   change
Weighted average yield on loans, excluding the effect of acquisition accounting adjustments 4.63 %   4.59 %   0.04     4.64 %   (0.01 )
Acquisition accounting adjustments 0.19 %   0.21 %   (0.02 )   0.31 %   (0.12 )
Weighted average yield on loans 4.82 %   4.80 %   0.02     4.95 %   (0.13 )
                             

The weighted average yield on loans for the first quarter increased by 2 basis points when compared with the preceding 2016 fourth quarter, or 4 basis points on a core basis, excluding the effect of acquisition accounting adjustments. Compared with the 2016 first quarter, the weighted average yield on loans declined 13 basis points, or 1 basis point on a core basis.

The weighted average yield on new loans originated during the 2017 first quarter improved 11 basis points to 4.26% from 4.15% in the preceding 2016 fourth quarter. The weighted average yield on new loans in the year-ago first quarter was 4.29%.

The weighted average cost of deposits and the impact of acquisition accounting adjustments are summarized in the following table:

  Three Months Ended
  3/31/2017   9/30/2016   change   3/31/2016   change
Weighted average cost of deposits, excluding the effect of acquisition accounting adjustments 0.69 %   0.68 %   0.01     0.63 %   0.06  
Acquisition accounting adjustments (0.14 )%   (0.13 )%   (0.01 )   %   (0.14 )
Weighted average cost of deposits 0.55 %   0.55 %       0.63 %   (0.08 )
                             

The weighted average cost of deposits for the 2017 first quarter was stable with preceding fourth quarter at 55 basis points, and increased 1 basis point on a core basis, excluding the effect of premium amortization on time and savings deposits assumed in acquisitions. Compared with the year-ago first quarter, the weighted average cost of deposits declined 8 basis points, but increased 6 basis points on a core basis.

Noninterest IncomeNoninterest income for the 2017 first quarter totaled $17.6 million, compared with $18.2 million in the preceding 2016 fourth quarter and $8.8 million in the year-ago first quarter for BBCN on a stand-alone basis.  Variations in noninterest income for comparable periods largely reflect variations in gain on sale of Small Business Administration (“SBA”) and gain on sale of other loans. Noninterest income for the 2017 first quarter included a $3.3 million gain on sale of SBA loans versus $3.7 million in the preceding fourth quarter. The Company posted a gain on sale of other loans in the 2017 first quarter of just $420,000, compared with $1.4 million in the 2016 fourth quarter.  The Company noted that the lower level of gain on sale of other loans, which represents gains from the sale of mortgage loans, reflects the seasonality in the mortgage industry and the initial impact of the rising interest rate environment. Noninterest income for the 2016 first quarter for BBCN on a standalone basis included $1.8 million gain on sale of SBA loans.

Noninterest Expense.  Total noninterest expense amounted to $66.3 million in the 2017 first quarter, $66.7 million in the preceding 2016 fourth quarter and $40.0 million in the year-ago first quarter for BBCN on a stand-alone basis. Excluding merger-related expenses of $947,000, $3.0 million and $1.2 million in the 2017 first quarter, 2016 fourth quarter and 2016 first quarter, respectively, total noninterest expense would have been $65.3 million, $63.8 million and $38.8 million.

Noninterest expense excluding merger-related expenses is a non-GAAP financial measure.  Management believes total noninterest expense excluding merger-related expenses more accurately reflects the Company’s results of operations in the overall evaluation of its performance.  A reconciliation of the noninterest expense excluding merger-related expenses is included in the accompanying financial tables.

Linked-quarter reductions in expenses related to occupancy, furniture and equipment and data processing and communications reflect the closure of 12 branches at the end of 2016. The benefit of these cost saves were offset in the first quarter of 2017 by higher-than-usual advertising and marketing fees associated with a major sponsorship event and elevated credit-related expenses.

The Company said it is on track to complete the second and final phase of its branch consolidation plan by the end of the second quarter, with the closure of six branches at the end of the 2017 first quarter, along with two additional branches scheduled to close at the end of April 2017 and one branch closure planned for late May 2017.

Salaries and employee benefits expense for the 2017 first quarter was flat with the preceding fourth quarter at $34.2 million.  This compares with salaries and employee benefits expense of $21.6 million for BBCN on a stand-alone basis in the 2016 first quarter. The total number of FTEs, excluding employees on leave, as of March 31, 2017 was 1,352, down modestly from 1,372 as of December 31, 2016. At March 31, 2016, the total number of FTEs for the former BBCN was 941.

Income Tax Provision.  The effective tax rate for the 2017 first quarter was 39.0%, compared with 40.1% for the preceding 2016 fourth quarter and 40.7% for the first quarter a year ago.

Balance Sheet Summary

Loans receivable totaled $10.55 billion at March 31, 2017, compared with $10.54 billion at December 31, 2016, and $6.37 billion at March 31, 2016.

Total new loan originations during the 2017 first quarter increased 26% over the seasonally higher preceding fourth quarter and amounted to $587.4 million, including residential mortgage loan originations of $58.0 million and SBA loan originations of $75.3 million.

Sales of SBA loans to the secondary market and gains derived from those sales are based substantially on the production of SBA 7(a) loans.  Production of SBA 7(a) loans totaled $51.9 million for the first quarter of 2017, compared with $42.2 million for the preceding 2016 fourth quarter and $37.6 million for the year-ago first quarter.  During the 2017 first quarter, the Company sold $44.9 million of its SBA loans held for sale, compared with $50.3 million in the preceding fourth quarter and $23.8 million in the first quarter a year ago.

Aggregate pay offs and pay downs in the 2017 first quarter amounted to $414.6 million, compared with $417.3 million for the preceding 2016 fourth quarter.  In the year-ago first quarter, aggregate pay offs and paydowns for BBCN on a stand-alone basis totaled $201.9 million.

Total deposits at March 31, 2017 increased to $10.70 billion from $10.64 billion at December 31, 2016, notwithstanding the closure of 12 branches at year-end 2016 under the first phase of the Company’s branch consolidation plan.  The increase in deposits reflects higher balances in noninterest bearing deposits and money market accounts, partially offset by reductions in time deposits under $100,000.  Total deposits at March 31, 2016 for the stand-alone BBCN amounted to $6.47 billion.

Credit Quality

The provision for loan losses for the 2017 first quarter was $5.6 million, compared with $800,000 for the preceding 2016 fourth quarter and $500,000 for the year-ago first quarter.

For a more detailed understanding of the changes in the Allowance for Loan and Lease Losses (“ALLL”), the composition of the ALLL has been segmented for disclosure purposes between loans accounted for under the amortized cost method (referred to as “legacy loans”) and loans acquired through the Wilshire Bancorp, Center Financial, Pacific International and Foster Bankshares transactions (referred to as “purchased loans”).  The purchased loans are further segregated between non-impaired and credit-impaired loans.

The composition of the ALLL as of March 31, 2017, December 31, 2016 and March 31, 2016 is as follows:

(dollars in thousands) (unaudited) 3/31/2017   12/31/2016   3/31/2016
Legacy loans (1) $ 64,055     $ 66,399     $ 64,016  
Purchased non-impaired loans (2)   2,468       814       963  
Purchased credit-impaired loans (2)   12,136       12,130       11,877  
Total ALLL $ 78,659     $ 79,343     $ 76,856  
                 
Loans receivable $ 10,549,667     $ 10,543,332     $ 6,371,935  
ALLL coverage ratio   0.75 %     0.75 %     1.21 %
                       

(1)  Legacy loans include loans originated by the Bank’s predecessor bank, loans originated by Bank of Hope and loans that were acquired and that have been refinanced as new loans.
(2)  Purchased loans were marked to fair value at acquisition date, and the allowance for loan losses reflect provisions for credit deterioration since the acquisition date.

Following are the components of criticized loan balances as of March 31, 2017, December 31, 2016 and March 31, 2016:

(dollars in thousands) (unaudited) 3/31/2017   12/31/2016   3/31/2016
Special Mention (1) $ 225,968   $ 243,656   $ 104,042
Classified (1)   309,996     313,055     203,398
Criticized $ 535,964   $ 556,711   $ 307,440

(1)  Balances include purchased loans which were marked to fair value on the date of acquisition.

The Company defines nonperforming loans to include delinquent loans past due 90 days or more on nonaccrual status, delinquent loans past due 90 days or more on accrual status (excluding purchased credit-impaired loans) and accruing restructured loans.  Nonaccrual loans at March 31, 2017 declined to $37.0 million, or 0.35% of loans receivable, from $40.1 million, or 0.38% of loans receivable, at December 31, 2016 and $43.5 million, or 0.68% of loans receivable, at March 31, 2016. Accruing restructured loans totaled $49.0 million at March 31, 2017, compared with $48.9 million at December 31, 2016 and $52.8 million at March 31, 2016.  Total nonperforming loans at March 31, 2017 declined to $86.3 million, or 0.82% of loans receivable, from $89.3 million, or 0.85% of loans receivable, at December 31, 2016 and $96.4 million, or 1.51% of loans receivable, at March 31, 2016.

Nonperforming assets, including nonperforming loans and OREO, declined to $105.4 million at March 31, 2017, from $111.2 million at December 31, 2016 and $116.1 million at March 31, 2016.  As a percentage of total assets, nonperforming assets improved to 0.78% at March 31, 2017 from 0.83% at December 31, 2016 and 1.44% at March 31, 2016.

For the 2017 first quarter, net charge offs totaled $6.3 million, or 0.24% of average loans receivable on an annualized basis, and included the charge off of a $3.0 million commercial credit relationship. In addition, charge offs aggregating approximately $3.6 million included smaller impairment charge offs caused by various circumstances like business closures or property vacancies leading to their nonperformance in the first quarter. In comparison, net charge offs for the preceding 2016 fourth quarter totaled $1.4 million, or 0.05% of average loans receivable on an annualized basis and $52,000, or 0.00% of average loans receivable on an annualized basis, for the year-ago first quarter.

The allowance for loan losses at March 31, 2017 was $78.7 million, or 0.75% of loans receivable (excluding loans held for sale), compared with $79.3 million, or 0.75%, at December 31, 2016 and $76.9 million, or 1.21%, at March 31, 2016.   The coverage ratio of the allowance for loan losses to nonperforming loans (excluding purchased credit-impaired loans) was 91.18% at March 31, 2017, versus 88.90% at December 31, 2016 and 79.77% at March 31, 2016.

Impaired loans (defined as loans for which it is probable that not all principal and interest payments due will be collected in accordance with the contractual terms) totaled $129.6 million at March 31, 2017, compared with $140.4 million at December 31, 2016 and $140.4 million at March 31, 2016.

Capital

At March 31, 2017, the Company continued to exceed all regulatory capital requirements to be classified as a “well-capitalized” institution, as summarized in the following table:

  3/31/2017   12/31/2016   3/31/2016   Minimum Guideline
for “Well-Capitalized”
Institution
Common Equity Tier 1 Capital 12.29 %   12.10 %   11.96 %   6.50 %
Tier 1 Leverage Ratio 11.75 %   11.49 %   11.44 %   5.00 %
Tier 1 Risk-based Ratio 13.12 %   12.92 %   12.54 %   8.00 %
Total Risk-based Ratio 13.83 %   13.64 %   13.64 %   10.00 %
                       

Tangible common equity per share and as a percentage of tangible assets are summarized in the following table:

  3/31/2017   12/31/2016   3/31/2016
Tangible common equity per share (1) $ 10.32     $ 10.15     $ 10.73  
Tangible common equity to tangible assets (1)   10.75 %     10.60 %     10.73 %

(1)  Tangible common equity to tangible assets is a non-GAAP financial measure that represents common equity less goodwill and net other intangible assets divided by total assets less goodwill and net other intangible assets.  Management reviews tangible common equity to tangible assets in evaluating the Company’s capital levels and has included this ratio in response to market participant interest in tangible common equity as a measure of capital.  The accompanying financial information includes a reconciliation of the ratio of tangible common equity to tangible assets with stockholders’ equity and total assets.

Form 10-K Filing

The Company has not yet filed its Annual Report on Form 10-K for the fiscal year ended December 31, 2016 with the Securities and Exchange Commission.  While the Company currently does not expect to report in its Annual Report on Form 10-K any material changes to its financial results from those previously reported in the January 24, 2017 press release for the Company’s financial results for the three and twelve months ended December 31, 2016, there can be no assurances that changes will not be made as the audit process is completed.  The Company presently expects to file its Annual Report on Form 10-K for the fiscal year ended December 31, 2016 with the Securities and Exchange Commission on or before May 12, 2017.

Internal Controls Over Financial Reporting

During the course of the audit of our financial statements for the fiscal year ended December 31, 2016, which audit is ongoing as of the date hereof, management identified certain material weaknesses in the system of internal control over financial reporting. A material weakness is a control deficiency, or combination of control deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

The following deficiencies relate to internal controls specific to the accounting for the merger with Wilshire Bancorp, Inc. (“Wilshire”):

  • deficiencies in internal controls, specifically related to the existence of loans, and monitoring of credit risk ratings of loans acquired as of the July 29, 2016 closing of the merger with Wilshire;
  • deficiencies in the documentation of information technology general controls related to the systems conversion process following the merger with Wilshire; and
  • deficiencies related to staffing within the Company to handle the increase in required documentation of the combined system of internal controls over financial reporting resulting from the merger with Wilshire.

The following deficiency relates to internal controls over financial reporting as of December 31, 2016:

  • deficiencies in internal controls over financial reporting due to the reclassifications made to the consolidated statement of cashflows in the Company’s Form 10-K for the year ended December 31, 2016.

Management determined that these significant control deficiencies constituted material weaknesses in the Company’s internal control over financial reporting. Management also acknowledges that additional control deficiencies may be identified, and that such control deficiencies could constitute additional material weaknesses.

Management, with the oversight of the audit committee, has taken, and continues to take steps that management and the audit committee believe will remediate the identified material weaknesses. As part of these steps:

  • management reviewed the material weaknesses with our audit committee and senior management;
  • management engaged an independent third party loan review firm subsequent to the closing of the merger with Wilshire to evaluate the existence of loans and adequacy of loan grades for the Wilshire loan portfolio as of June 30, 2016 and September 30, 2016. Therefore, management is comfortable with the existence of loans and adequacy of loan grades for the Wilshire loan portfolio as of December 31, 2016;
  • management intends for future mergers and acquisitions, to perform, or have a third party perform, testing for the existence of loans and the adequacy of loan grades as of the exact transaction date in addition to due diligence and loans reviews that we normally perform;
  • management intends for future mergers and acquisitions, to enhance the documentation of IT general controls in place for the process of conversion;
  • management engaged an outside third party to assist with matters related to internal controls and recently hired a SOX compliance officer who will oversee issues related to the Company’s internal controls and other SOX related matters with the continued assistance of the third party; and
  • management will enhance its controls over financial reporting to seek to prevent any future reclassifications of the consolidated statement of cashflows.

Management believes that these changes will contribute significantly to the remediation of the material weaknesses in internal control over financial reporting. Additional changes may be implemented if determined necessary to remediate the identified material weaknesses and/or if additional material weaknesses are discovered. Although the Company’s remediation efforts are well underway and are expected to be completed in the near future, the Company’s material weaknesses will not be considered remediated until new internal controls are operational for a period of time and are tested, and management concludes that these controls are operating effectively.

Investor Conference Call

The Company will host an investor conference call on Friday, April 28, 2017 at 9:30 a.m. Pacific Time / 12:30 p.m. Eastern Time to review financial results for the first quarter ended March 31, 2017.  Investors and analysts are invited to access the conference call by dialing 866-235-9917 (domestic) or 412-902-4103 (international), and asking for the “Hope Bancorp Call.”  Other interested parties are invited to listen to a live webcast of the call available at the Investor Relations section of Hope Bancorp’s website at www.ir-hopebancorp.com.   After the live webcast, a replay will remain available in the Investor Relations section of Hope Bancorp’s website for one year.  A telephonic replay of the call will be available at 877-344-7529 (domestic) or 412-317-0088 (international) for one week through May 5, 2017, replay access code 10104107.

About Hope Bancorp, Inc.

Hope Bancorp, Inc. is the holding company of Bank of Hope, the first and only super regional Korean-American bank in the United States with $13.5 billion in total assets as of March 31, 2017. Formed through the merger of BBCN Bank and Wilshire Bank, the top two commercial lenders in the market, Bank of Hope is headquartered in Los Angeles and serves a multi-ethnic population of customers across the nation. Bank of Hope operates 67 full-service branches in California, Washington, Texas, Illinois, New York, New Jersey, Virginia, Georgia and Alabama. The Bank also operates SBA loan production offices in Seattle, Denver, Dallas, Atlanta, and Portland, Oregon; a commercial loan production office in Fremont, California; residential mortgage loan production offices in California; and a representative office in Seoul, Korea. Bank of Hope specializes in core business banking products for small and medium-sized businesses, with an emphasis in commercial real estate and commercial lending, SBA lending and international trade financing. Bank of Hope is a California-chartered bank, and its deposits are insured by the FDIC to the extent provided by law. Bank of Hope is an Equal Opportunity Lender. For additional information, please go to bankofhope.com.

Forward-Looking Statements

This press release may contain forward-looking statements, which are the statements contained herein that are not historical facts. These statements are based on current expectations, estimates, forecasts and projections and management assumptions about the future performance of the Company, the businesses and markets in which the Company operates and is expected to operate, as well as the timing and substance of certain public disclosures regarding the Company’s financial condition, results of operations and internal controls over financial reporting. These statements constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, involve certain risks, uncertainties and assumptions that are difficult to assess, and  are not guarantees of future performance.  Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements as a result of such risks, uncertainties and assumptions, including, but not limited to the following: the Company’s inability to remediate its presently identified material weaknesses or to do so in a timely manner, the possibility that additional material weaknesses may arise in the future, and that a material weakness may have an impact on our reported financial results; the effect of acquisitions that the Company may make, if any, including, without limitation, the failure to achieve the expected revenue growth and/or expense savings from its acquisitions; inability to consummate the Company’s proposed merger with U & I Financial Corp. on the terms it has proposed; and failure to realize the benefits from the merger with U & I Financial Corp. that the Company currently expects if the merger is consummated. Readers should carefully review the risk factors and other information that could affect the Company’s financial results and business, described in documents the Company files from time to time with the Securities and Exchange Commission, including its quarterly reports on Form 10-Q and Annual Reports on Form 10-K. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements.

(tables follow)

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands, except share data)
 
Assets 3/31/2017   12/31/2016   % change   3/31/2016   % change
Cash and due from banks $ 461,068     $ 437,334     5 %   $ 236,101     95 %
Securities available for sale, at fair value 1,583,946     1,556,740     2 %   1,087,897     46 %
Federal Home Loan Bank (“FHLB”), Federal Reserve Bank (“FRB”) stock and other investments 65,161     66,166     (2 )%   68,329     (5 )%
Loans held for sale, at the lower of cost or fair value 19,141     22,785     (16 )%   13,843     38 %
Loans receivable 10,549,667     10,543,332     %   6,371,935     66 %
Allowance for loan losses (78,659 )   (79,343 )   1 %   (76,856 )   (2 )%
Net loans receivable 10,471,008     10,463,989     %   6,295,079     66 %
Accrued interest receivable 25,683     26,880     (4 )%   15,660     64 %
Premises and equipment, net 54,425     55,316     (2 )%   35,134     55 %
Bank owned life insurance 74,090     73,696     1 %   47,292     57 %
Goodwill 463,975     462,997     %   105,401     340 %
Servicing assets 25,941     26,457     (2 )%   11,856     119 %
Other intangible assets, net 18,550     19,226     (4 )%   2,607     612 %
Other assets 202,875     229,836     (12 )%   144,553     40 %
Total assets $ 13,465,863     $ 13,441,422     %   $ 8,063,752     67 %
                                   
Liabilities                                  
Deposits $ 10,703,777     $ 10,642,035     1 %   $ 6,467,411     66 %
Borrowings from FHLB 703,850     754,290     (7 )%   530,495     33 %
Subordinated debentures 100,067     99,808     %   42,371     136 %
Accrued interest payable 10,592     10,863     (2 )%   6,746     57 %
Other liabilities 68,780     78,953     (13 )%   54,747     26 %
Total liabilities 11,587,066     11,585,949     %   7,101,770     63 %
                                   
Stockholders’ Equity                                  
Common stock, $0.001 par value; authorized, 150,000,000 shares at March 31, 2017, December 31, 2016, and March 31, 2016; issued and outstanding, 135,248,185, 135,240,079, and 79,597,106 shares at March 31, 2017, December 31, 2016, and March 31, 2016, respectively. $ 135     $ 135     %   $ 80     69 %
Capital surplus 1,401,275     1,400,490     %   541,625     159 %
Retained earnings 490,236     469,505     4 %   413,122     19 %
Accumulated other comprehensive income (loss), net (12,849 )   (14,657 )   12 %   7,155     (280 )%
Total stockholders’ equity 1,878,797     1,855,473     1 %   961,982     95 %
Total liabilities and stockholders’ equity $ 13,465,863     $ 13,441,422     %   $ 8,063,752     67 %
                   
Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands, except per share data)
 
  Three Months Ended
  3/31/2017   12/31/2016   % change   3/31/2016   % change
Interest income:                  
Interest and fees on loans $ 123,294     $ 125,791     (2 )%   $ 77,118     60 %
Interest on securities 8,113     7,391     10 %   5,677     43 %
Interest on federal funds sold and other investments 1,336     2,205     (39 )%   666     101 %
Total interest income 132,743     135,387     (2 )%   83,461     59 %
                                   
Interest expense:                                  
Interest on deposits 14,511     14,815     (2 )%   9,907     46 %
Interest on other borrowings 3,327     3,363     (1 )%   1,947     71 %
Total interest expense 17,838     18,178     (2 )%   11,854     50 %
                                   
Net interest income before provision for loan losses 114,905     117,209     (2 )%   71,607     60 %
Provision for loan losses 5,600     800     600 %   500     1,020 %
Net interest income after provision for loan losses 109,305     116,409     (6 )%   71,107     54 %
                                   
Noninterest income:                                  
Service fees on deposit accounts 5,338     5,601     (5 )%   2,683     99 %
Net gains on sales of SBA loans 3,250     3,660     (11 )%   1,825     78 %
Net gains on sales of other loans 420     1,401     (70 )%       100 %
Net gains on sales of securities available for sale     2     (100 )%       %
Other income and fees 8,595     7,528     14 %   4,267     101 %
Total noninterest income 17,603     18,192     (3 )%   8,775     101 %
                                   
Noninterest expense:                                  
Salaries and employee benefits 34,169     34,162     %   21,569     58 %
Occupancy 7,194     7,948     (9 )%   4,817     49 %
Furniture and equipment 3,413     3,805     (10 )%   2,287     49 %
Advertising and marketing 3,424     2,475     38 %   1,136     201 %
Data processing and communications 3,606     3,904     (8 )%   2,171     66 %
Professional fees 2,609     2,301     13 %   1,083     141 %
FDIC assessment 1,010     468     116 %   1,038     (3 )%
Credit related expenses 1,883     812     132 %   421     347 %
Other real estate owned (“OREO”) expense, net 997     1,354     (26 )%   1,428     (30 )%
Merger-related expenses 947     2,952     (68 )%   1,207     (22 )%
Other 7,041     6,550     7 %   2,892     143 %
Total noninterest expense 66,293     66,731     (1 )%   40,049     66 %
Income before income taxes 60,615     67,870     (11 )%   39,833     52 %
Income tax provision 23,655     27,240     (13 )%   16,210     46 %
Net income $ 36,960     $ 40,630     (9 )%   $ 23,623     56 %
                   
Earnings Per Common Share:                  
Basic $ 0.27     $ 0.30         $ 0.30      
Diluted $ 0.27     $ 0.30         $ 0.30      
                   
Average Shares Outstanding:                  
Basic 135,248,018     135,238,928         79,583,188      
Diluted 135,689,816     135,585,561         79,613,245      
Hope Bancorp, Inc.
Selected Financial Data
Unaudited
 
  For the Three Months Ended
(Annualized)
Profitability measures: 3/31/2017   12/31/2016   3/31/2016
ROA 1.11 %   1.20 %   1.20 %
ROE 7.91 %   8.72 %   9.99 %
Return on average tangible equity 1 10.66 %   11.77 %   11.28 %
Net interest margin 3.77 %   3.75 %   3.84 %
Efficiency ratio 50.03 %   49.28 %   49.82 %
           
Average tangible equity is calculated by subtracting average goodwill and average core deposit intangible assets from average stockholders’ equity. This is a non-GAAP measure that we believe provides investors with information that is useful in understanding our financial performance and position.
 
Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)
 
  Three Months Ended   Three Months Ended   Three Months Ended
  3/31/2017   12/31/2016   3/31/2016
      Interest   Annualized       Interest   Annualized       Interest    Annualized
  Average   Income/   Average   Average   Income/   Average   Average   Income/    Average
  Balance   Expense   Yield/Cost   Balance   Expense   Yield/Cost   Balance   Expense    Yield/Cost
INTEREST EARNING ASSETS:                                  
Loans receivable, including loans held for sale $ 10,381,771     $ 123,294     4.82 %   $ 10,427,538     $ 125,791     4.80 %   $ 6,270,679     $ 77,118     4.95 %
Securities available for sale 1,567,497     8,113     2.10 %   1,586,560     7,391     1.85 %   1,016,865     5,677     2.25 %
FRB and FHLB stock and other investments 423,955     1,336     1.28 %   433,212     2,205     2.02 %   217,048     666     1.23 %
Total interest earning assets $ 12,373,223     $ 132,743     4.35 %   $ 12,447,310     $ 135,387     4.33 %   $ 7,504,592     $ 83,461     4.47 %
                                                                 
INTEREST BEARING LIABILITIES:                                                                
Deposits:                                                                
Demand, interest bearing $ 3,436,984     $ 7,191     0.85 %   $ 3,414,158     $ 7,054     0.82 %   $ 1,968,637     $ 4,004     0.82 %
Savings 293,609     287     0.40 %   303,064     319     0.42 %   186,462     366     0.79 %
Time deposits:                                                                
$100,000 or more 2,976,937     5,107     0.70 %   3,035,499     5,325     0.70 %   1,806,609     4,056     0.90 %
Other 1,032,242     1,926     0.76 %   1,085,254     2,117     0.78 %   699,431     1,481     0.85 %
Total time deposits 4,009,179     7,033     0.71 %   4,120,753     7,442     0.72 %   2,506,040     5,537     0.89 %
Total interest bearing deposits 7,739,772     14,511     0.76 %   7,837,975     14,815     0.75 %   4,661,139     9,907     0.85 %
FHLB advances 662,472     2,139     1.31 %   681,757     2,190     1.28 %   532,206     1,523     1.15 %
Other borrowings 95,911     1,188     4.95 %   95,650     1,173     4.80 %   40,813     424     4.11 %
Total interest bearing liabilities 8,498,155     $ 17,838     0.85 %   8,615,382     $ 18,178     0.84 %   5,234,158     $ 11,854     0.91 %
Noninterest bearing demand deposits 2,868,339               2,918,156             1,629,565            
Total funding liabilities/cost of funds $ 11,366,494         0.64 %   $ 11,533,538         0.63 %   $ 6,863,723         0.69 %
Net interest income/net interest spread     $ 114,905     3.50 %       $ 117,209     3.49 %       $ 71,607     3.56 %
Net interest margin         3.77 %           3.75 %           3.84 %
Cost of deposits:                                                                
Noninterest bearing demand deposits $ 2,868,339     $           $ 2,918,156     $         $ 1,629,565     $        
Interest bearing deposits 7,739,772     14,511     0.76 %   7,837,975     14,815     0.75 %   4,661,139     9,907     0.85 %
Total deposits $ 10,608,111     $ 14,511     0.55 %   $ 10,756,131     $ 14,815     0.55 %   $ 6,290,704     $ 9,907     0.63 %

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)
 
   Three Months Ended
AVERAGE BALANCES: 3/31/2017   12/31/2016   % change   3/31/2016   % change
Loans receivable, including loans held for sale $ 10,381,771     $ 10,427,538     %   $ 6,270,679     66 %
Investments 1,991,452     2,019,772     (1 )%   1,233,913     61 %
Interest earning assets 12,373,223     12,447,310     (1 )%   7,504,592     65 %
Total assets 13,335,554     13,506,836     (1 )%   7,875,940     69 %
                                   
Interest bearing deposits 7,739,772     7,837,975     (1 )%   4,661,139     66 %
Interest bearing liabilities 8,498,155     8,615,382     (1 )%   5,234,158     62 %
Noninterest bearing demand deposits 2,868,339     2,918,156     (2 )%   1,629,565     76 %
Stockholders’ equity 1,869,006     1,864,766     %   945,634     98 %
Net interest earning assets 3,875,068     3,831,928     1 %   2,270,434     71 %
                                   
LOAN PORTFOLIO COMPOSITION: 3/31/2017   12/31/2016   % change   3/31/2016   % change
Commercial loans $ 1,840,193     $ 1,986,949     (7 )%   $ 1,118,420     65 %
Real estate loans 8,291,188     8,154,570     2 %   5,132,517     62 %
Consumer and other loans 420,169     403,470     4 %   124,064     239 %
Loans outstanding 10,551,550     10,544,989     %   6,375,001     66 %
Unamortized deferred loan fees – net of costs (1,883 )   (1,657 )   (14 )%   (3,066 )   39 %
Loans, net of deferred loan fees and costs 10,549,667     10,543,332     %   6,371,935     66 %
Allowance for loan losses (78,659 )   (79,343 )   1 %   (76,856 )   (2 )%
Loan receivable, net $ 10,471,008     $ 10,463,989     %   $ 6,295,079     66 %
                                   
REAL ESTATE LOANS BY PROPERTY TYPE: 3/31/2017   12/31/2016   % change   3/31/2016   % change
Retail buildings $ 2,213,627     $ 2,163,075     2 %   $ 1,339,676     65 %
Hotels/motels 1,593,758     1,605,787     (1 )%   1,079,649     48 %
Gas stations/car washes 938,158     946,364     (1 )%   689,883     36 %
Mixed-use facilities 596,074     563,484     6 %   381,955     56 %
Warehouses 899,009     892,100     1 %   530,353     70 %
Multifamily 443,632     423,084     5 %   251,780     76 %
Other 1,606,930     1,560,676     3 %   859,221     87 %
Total $ 8,291,188     $ 8,154,570     2 %   $ 5,132,517     62 %
                                   
DEPOSIT COMPOSITION 3/31/2017   12/31/2016   % change   3/31/2016   % change
Noninterest bearing demand deposits $ 2,963,947     $ 2,900,241     2 %   $ 1,695,040     75 %
Money market and other 3,481,231     3,401,446     2 %   1,951,561     78 %
Saving deposits 289,924     301,906     (4 )%   181,779     59 %
Time deposits of $100,000 or more 2,984,078     2,982,256     %   1,885,842     58 %
Other time deposits 984,597     1,056,186     (7 )%   753,189     31 %
Total deposit balances $ 10,703,777     $ 10,642,035     1 %   $ 6,467,411     66 %
                                   
DEPOSIT COMPOSITION (%) 3/31/2017   12/31/2016       3/31/2016    
Noninterest bearing demand deposits 27.7 %   27.3 %       26.2 %    
Money market and other 32.5 %   32.0 %       30.2 %    
Saving deposits 2.7 %   2.8 %       2.8 %    
Time deposits of $100,000 or more 27.9 %   28.0 %       29.2 %    
Other time deposits 9.2 %   9.9 %       11.6 %    
Total deposit balances 100.0 %   100.0 %       100.0 %    
Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)
 
CAPITAL RATIOS: 3/31/2017   12/31/2016   3/31/2016        
Total stockholders’ equity $ 1,878,797     $ 1,855,473     $ 961,982          
Common Equity Tier 1 ratio 12.29 %   12.10 %   11.96 %        
Tier 1 risk-based capital ratio 13.12 %   12.92 %   12.54 %        
Total risk-based capital ratio 13.83 %   13.64 %   13.64 %        
Tier 1 leverage ratio 11.75 %   11.49 %   11.44 %        
Total risk weighted assets $ 11,545,191     $ 11,575,944     $ 7,093,779          
Book value per common share $ 13.89     $ 13.72     $ 12.09          
Tangible common equity to tangible assets 2 10.75 %   10.60 %   10.73 %        
Tangible common equity per share 2 $ 10.32     $ 10.15     $ 10.73          
                   
2  Tangible common equity to tangible assets is a non-GAAP financial measure that represents common equity less goodwill and core deposit intangible assets, net divided by total assets less goodwill and core deposit intangible assets, net.  Management reviews tangible common equity to tangible assets in evaluating the Company’s capital levels and has included this ratio in response to market participant interest in tangible common equity as a measure of capital.
                   
Reconciliation of GAAP financial measures to non-GAAP financial measures:        
  Three Months Ended    
NONINTEREST EXPENSE BEFORE MERGER-RELATED COSTS 3/31/2017   12/31/2016   3/31/2016        
Total noninterest expense $ 66,293     $ 66,731     $ 40,049          
Less: merger-related costs 947     2,952     1,207          
Total noninterest expense, excluding merger-related expense $ 65,346     $ 63,779     $ 38,842          
                   
CORE EPS LESS MERGER RELATED EXPENSES                  
Net income $ 36,960     $ 40,630     $ 23,623          
Less: merger-related costs 947     2,952     1,207          
Tax provision adjustment (370 )   (1,185 )   (491 )        
Net income, excluding merger-related expense $ 37,537     $ 42,397     $ 24,339          
                   
Weighted average common shares diluted 135,689,816     135,585,561     79,613,245          
Core EPS excluding merger-related expenses $ 0.28     $ 0.31     $ 0.31          
                   
TANGIBLE COMMON EQUITY                  
Total stockholders’ equity $ 1,878,797     $ 1,855,473     $ 961,982          
Less:  Common stock warrant                  
Less:  Goodwill and core deposit intangible assets, net (482,525 )   (482,223 )   (108,008 )        
Tangible common equity $ 1,396,272     $ 1,373,250     $ 853,974          
                   
Total assets $ 13,465,863     $ 13,441,422     $ 8,063,752          
Less:  Goodwill and core deposit intangible assets, net (482,525 )   (482,223 )   (108,008 )        
Tangible assets $ 12,983,338     $ 12,959,199     $ 7,955,744          
                   
Common shares outstanding 135,248,185     135,240,079     79,597,106          
                   
Tangible common equity to tangible assets 10.75 %   10.60 %   10.73 %        
Tangible common equity per share $ 10.32     $ 10.15     $ 10.73          
                   
   
   
Hope Bancorp, Inc.
Selected Financial Data
 Unaudited (dollars in thousands) 
                   
  Three Months Ended
ALLOWANCE FOR LOAN LOSSES: 3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Balance at beginning of period $ 79,343     $ 79,976     $ 76,425     $ 76,856     $ 76,408  
Provision for loan losses 5,600     800     6,500     1,200     500  
Recoveries 321     452     1,010     664     769  
Charge offs (6,605 )   (1,885 )   (3,959 )   (2,295 )   (821 )
Balance at end of period $ 78,659     $ 79,343     $ 79,976     $ 76,425     $ 76,856  
Net charge offs/average loans receivable (annualized) 0.24 %   0.05 %   0.13 %   0.10 %   %
                   
  Three Months Ended
NET CHARGED OFF (RECOVERED) LOANS  BY TYPE: 3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Real estate loans $ 1,444     $ (45 )   $ 127     $ 18     $ (390 )
Commercial loans 4,564     1,000     2,663     1,649     379  
Consumer loans 276     478     159     (36 )   63  
Total net charge offs $ 6,284     $ 1,433     $ 2,949     $ 1,631     $ 52  
Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)
 
NONPERFORMING ASSETS 3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Delinquent loans on nonaccrual status 3 $ 37,009     $ 40,074     $ 40,602     $ 42,398     $ 43,548  
Delinquent loans 90 days or more on accrual status 4 275     305     192     147     45  
Accruing restructured loans 48,984     48,874     48,701     50,837     52,760  
Total nonperforming loans 86,268     89,253     89,495     93,382     96,353  
Other real estate owned 19,096     21,990     27,457     16,392     19,794  
Total nonperforming assets $ 105,364     $ 111,243     $ 116,952     $ 109,774     $ 116,147  
Nonperforming assets/total assets 0.78 %   0.83 %   0.87 %   1.32 %   1.44 %
Nonperforming assets/loans receivable & OREO 1.00 %   1.05 %   1.10 %   1.66 %   1.82 %
Nonperforming assets/total capital 5.61 %   6.00 %   6.31 %   11.30 %   12.07 %
Nonperforming loans/loans receivable 0.82 %   0.85 %   0.85 %   1.42 %   1.51 %
Nonaccrual loans/loans receivable 0.35 %   0.38 %   0.38 %   0.64 %   0.68 %
Allowance for loan losses/loans receivable 0.75 %   0.75 %   0.76 %   1.16 %   1.21 %
Allowance for loan losses/nonaccrual loans 212.54 %   197.99 %   196.98 %   180.26 %   176.49 %
Allowance for loan losses/nonperforming loans 91.18 %   88.90 %   89.36 %   81.84 %   79.77 %
Allowance for loan losses/nonperforming assets 74.65 %   71.32 %   68.38 %   69.62 %   66.17 %
                   
3  Excludes delinquent SBA loans that are guaranteed and currently in liquidation totaling $15.2 million, $15.9 million, $14.1 million, $15.5 million, and $15.4 million, at March 31, 2016, December 31, 2016, September 30, 2016, June 30, 2016, and March 31, 2016, respectively.
4  Excludes Acquired Credit Impaired Loans totaling $17.3 million, $19.6 million, $16.4 million, $13.8 million, and $13.1 million at March 31, 2017, December 31, 2016, September 30, 2016, June 30, 2016, and March 31, 2016, respectively.
                   
BREAKDOWN OF ACCRUING RESTRUCTURED LOANS BY TYPE: 3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Retail buildings $ 5,794     $ 5,832     $ 5,876     $ 4,565     $ 4,598  
Hotels/motels 1,300     1,305     1,315     1,324     1,336  
Gas stations/car washes         829     835     840  
Mixed-use facilities 134     889     895     1,111     1,117  
Warehouses 5,321     5,379     5,449     5,512     5,575  
Other 5 36,435     35,469     34,337     37,490     39,294  
Total $ 48,984     $ 48,874     $ 48,701     $ 50,837     $ 52,760  
                   
Includes commercial business and other loans                  
                   
                   
DELINQUENT LOANS LESS THAN 90 DAYS PAST DUE 3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Legacy                  
30 – 59 days $ 10,199     $ 6,254     $ 3,580     $ 2,920     $ 4,488  
60 – 89 days 3,978     6,719     1,100     1,427     1,510  
Total delinquent loans less than 90 days past due – legacy $ 14,177     $ 12,973     $ 4,680     $ 4,347     $ 5,998  
                   
Acquired                  
30 – 59 days $ 5,248     $ 4,015     $ 3,451     $ 2,735     $ 1,456  
60 – 89 days 1,007     1,049     1,168     345     47  
Total delinquent loans less than 90 days past due – acquired $ 6,255     $ 5,064     $ 4,619     $ 3,080     $ 1,503  
                   
Total delinquent loans less than 90 days past due $ 20,432     $ 18,037     $ 9,299     $ 7,427     $ 7,501  
                   

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)
 
DELINQUENT LOANS LESS THAN 90 DAYS PAST DUE BY TYPE     3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Legacy                      
Real estate loans     $ 12,575     $ 10,896     $ 2,678     $ 2,047     $ 1,624  
Commercial loans     1,404     2,010     1,866     2,215     1,441  
Consumer loans     198     67     136     85     2,933  
Total delinquent loans less than 90 days past due – legacy     $ 14,177     $ 12,973     $ 4,680     $ 4,347     $ 5,998  
                       
Acquired                      
Real estate loans     $ 5,211     $ 2,721     $ 3,761     $ 2,557     $ 1,189  
Commercial loans     360     1,987     858     211     314  
Consumer loans     684     356         312      
Total delinquent loans less than 90 days past due – acquired     $ 6,255     $ 5,064     $ 4,619     $ 3,080     $ 1,503  
                       
Total delinquent loans less than 90 days past due     $ 20,432     $ 18,037     $ 9,299     $ 7,427     $ 7,501  
                       
                       
NONACCRUAL LOANS  BY TYPE     3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Real estate loans     $ 26,550     $ 27,522     $ 24,055     $ 25,306     $ 26,123  
Commercial loans     10,117     11,773     15,742     16,270     16,842  
Consumer loans     342     779     805     822     583  
Total nonaccrual loans     $ 37,009     $ 40,074     $ 40,602     $ 42,398     $ 43,548  
                       
CRITICIZED LOANS     3/31/2017   12/31/2016   9/30/2016   6/30/2016   3/31/2016
Legacy                      
Special mention     $ 127,432     $ 127,562     $ 168,289     $ 80,923     $ 87,025  
Substandard     167,747     162,942     124,938     128,885     129,314  
Doubtful     233     95     441     108     133  
Loss                      
Total criticized loans – legacy     $ 295,412     $ 290,599     $ 293,668     $ 209,916     $ 216,472  
                       
Acquired                      
Special mention     $ 98,536     $ 116,094     $ 140,604     $ 19,447     $ 17,017  
Substandard     139,964     148,164     131,398     67,261     71,954  
Doubtful     2,052     1,854     2,624     2,603     1,997  
Loss             (133 )        
Total criticized loans – acquired     $ 240,552     $ 266,112     $ 274,493     $ 89,311     $ 90,968  
                       
Total criticized loans     $ 535,964     $ 556,711     $ 568,161     $ 299,227     $ 307,440  

 

CONTACT: Contact:
Angie Yang
SVP, Director of Investor Relations &
Corporate Communications
213-251-2219
[email protected]