Hanmi Financial Corporation · NASDAQ:HAFC
Hanmi Financial — Q1 2025 Earnings Presentation
34 slides from Hanmi Financial's earnings presentation, Apr 22, 2025
Slide 1: 1Q25 Earnings Supplemental Presentation
NASDAQ | HAFC 1Q25 Earnings Supplemental Presentation April 22, 2025 California | Colorado | Georgia | Illinois | New Jersey | New York | Texas | Virginia | Washington
Slide 2: Table of Contents
1Q25 PERFORMANCE RESULTS 05 – 21 TABLE OF LOAN PORTFOLIO DETAILS 22 – 31 CONTENTS 1Q25 FINANCIAL SUMMARY 32 – 32 NON-GAAP RECONCILIATION 33 – 34 2
Slide 3: Forward-Looking Statements
FORWARD -LOOKING STATEMENTS Hanmi Financial Corporation (the “Company”) cautions investors that any statements contained herein that are not historical facts are forward- looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, in
Slide 4: Non-GAAP Financial Information
NON-GAAP FINANCIAL INFORMATION This presentation contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These non-GAAP measures include tangible common equity to tangible assets, and tangib
Slide 5: 1Q25 Highlights
1Q25 HIGHLIGHTS Earnings Performance • Net income of $17.7 million, unchanged from the prior quarter • Net interest margin up 11 basis points from the prior quarter, resulting in net interest income of $55.1 million, up 3.1% from the prior quarter • Noninterest income of $7.7 million, up 5.0% from t
Slide 6: Loan Production
LOAN PRODUCTION Weighted Average Coupon on New Production Loan production of $345.9 million in the first quarter included a meaningful contribution from 8.02% 8.31% 7.92% 7.37% 7.35% residential mortgage production, which increased 37% to $55.0 million quarter-over-quarter. ($ in millions) $347.8 $3
Slide 7: Loan Portfolio
LOAN PORTFOLIO Outstanding ($ in millions) 1Q25 Average Yield Commercial Real Estate $6.28 Billion Loan Portfolio (CRE)(1,2) Portfolio $3,975 5.65% (as of March 31, 2025) Residential Real Estate (RRE)(3) Portfolio $980 5.39% Equipment Commercial & Industrial C&I Finance (C&I)(1) Portfolio $854 7.76%
Slide 8: Deposit Portfolio
DEPOSIT PORTFOLIO Total deposits increased 3% to $6.62 billion, led $3,650 $2,969 Deposits by a $140.4 million, or 7%, increase in money as of 1Q25 55% 45% market and savings deposits quarter-over-quarter. ($ in millions) Noninterest-bearing demand deposits represented 31% of total deposits Business
Slide 9: Net Interest Income | Net Interest Margin
NET INTEREST INCOME | NET INTEREST MARGIN Net Interest Margin Net interest income for the fourth quarter was $55.1 million and net interest margin (taxable equivalent) 0.13% was 3.02%, both up from the fourth quarter primarily due to a decrease in deposit interest expense. 0.02% -0.02% 3.02% 2.91% -
Slide 10: Net Interest Income Sensitivity
NET INTEREST INCOME SENSITIVITY Loan & Deposit Beta(1) Fed Funds Rate & Cost of CDs Fed 5.50% 5.50% 5.00% 4.50% Funds 4.55% Rate(3) 6.02% 6.00% 6.04% 5.95% 5.90% 5.93% Loan 5.91% Cost of 5.64% 5.78% Yield 4.66% 4.78% 4.79% 4.50% 4.17% 5.60% CDs(2) 5.44% 5.00% 5.50% 5.50% 5.50% 5.50% 5.50% Fed 1Q24 2
Slide 11: Noninterest Income
NONINTEREST INCOME 1Q25 Service Charges and Fees（$ in million） Noninterest income for the first quarter was $7.7 million, up 5% from the fourth quarter, primarily Service charges on deposit accounts because of a $0.6 million increase on gains from 29% Trade finance and other service 40% $2.2 the sal
Slide 12: Noninterest Expense
NONINTEREST EXPENSE Noninterest expense was $35.0 million for the first quarter, up 1.3% from the fourth quarter of 2024, primarily reflecting a $1.6 million gain from the sale of a other real estate owned property in the fourth quarter. 1.94% 1.89% 1.85% 1.86% Noninterest expense / 1.82% Average as
Slide 13: Asset Quality – Delinquent & Criticized Loans
ASSET QUALITY – DELINQUENT & CRITICIZED LOANS Criticized Loans(2)（$ in millions） The $21.2 million decrease in special mention 2.56% 2.64% 2.62% loans in the first quarter was primarily driven by a Criticized $19.5 million upgrade of a C&I loan. loans / 1.39% Total loans 1.15% The $20.8 million incr
Slide 14: Asset Quality – Nonperforming Assets & Nonaccrual Loans
ASSET QUALITY – NONPERFORMING ASSETS & NONACCRUAL LOANS Nonperforming assets were $35.7 million at the end of the first quarter, up from $14.4 million at the end of the fourth quarter. Nonaccrual Loans（$ in millions） The increase was primarily driven by a $20.0 million commercial real estate loan de
Slide 15: Asset Quality – Gross & Net Loan Charge-offs
ASSET QUALITY – GROSS & NET LOAN CHARGE -OFFS Net charge-offs for the first quarter were $1.9 million. Net Charge-offs (Recoveries)（$ in millions） Gross Charge-offs（$ in millions） 0.12% 0.13% Net Charge-offs / 0.10% 0.06% -0.01% Average loans $3.8 $3.4 $3.2 $1.3 $0.5 $0.9 $1.9 $0.4 $1.6 $1.8 $2.3 $2
Slide 16: ACL Trends
ACL TRENDS Allowance for credit losses was $70.6 million at March 31, 2025, or 1.12% to total loans, compared Credit Loss Expense（$ in millions） with $70.1 million and 1.12% at the end of the prior quarter. $2.4 $2.3 Allowance for Credit Losses（$ in millions） 1.11% 1.10% 1.11% 1.12% 1.12% $1.0 $0.9
Slide 17: ACL Analysis by Loan Type
ACL ANALYSIS BY LOAN TYPE ($ in millions) March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 Allowance Loans Allowance Loans Allowance Loans Allowance Loans Allowance Loans CRE $ 41.4 $ 3,975.7 $ 39.3 $ 3,949.6 $ 37.8 $ 3,932.1 $ 36.1 $ 3,888.5 $ 36.4 $ 3,878.5 C&I 6.2
Slide 18: Securities Portfolio
SECURITIES PORTFOLIO Available for Sale(1) Unrealized Loss The $991 million securities $991 Million $84 Million US Agy Municipal portfolio (all AFS, no HTM) represented 12% 4% Municipal UST US Agy CMO 13% of assets at March 31, 2025, and 8% 9% US Agy 8% US Agy CMO had a weighted average modified 20%
Slide 19: Liquidity
LIQUIDITY Cash & Securities at Company-only （$ in millions） The Bank and the Company have ample liquidity Balance resources at March 31, 2025. Cash $ 7 Securities (AFS) 43 $ 50 Liquidity Position（$ in millions） Liquidity Ratios Balance % of Assets Liquid Assets to Total Assets Liquid Assets to Depos
Slide 20: Capital Management
CAPITAL MANAGEMENT Dividend, Share Repurchase & TCE/TA(1)（$ in millions） Prudent capital management while driving shareholder return through stable quarterly dividends 9.59% 9.42% 9.41% and share repurchase program. Tangible book value 9.23% 9.19% TCE / TA(1) per share (TBVPS)(1) increased to $24.49
Slide 21: Regulatory Capital
REGULATORY CAPITAL The Company exceeds regulatory minimums and the Bank remains well capitalized at March 31, 2025. Company Bank CET1 CET1 4.50% 2.50% 7.00% 6.50% Capital Capital 12.13% 13.35% 11.23% 12.45% Tier 1 Tier 1 6.00% 2.50% 8.50% 8.00% Capital Capital 12.47% 13.35% 11.57% 12.45% Total Total
Slide 22: Loan Portfolio Diversification
LOAN PORTFOLIO DIVERSIFICATION • CRE(1) represents 63% of the total portfolio • C&I(2) represents 14% of the total portfolio. Mixed Use 3% Gas Station 5% Construction 2% Other 6% CRE Portfolio(1) Multifamily 10% C&I Portfolio(2) Other Manufacturing 33% 29% $3,975M Industrial 11% Retail 28% $854M Fin
Slide 23: CRE Portfolio Geographical Exposure
CRE PORTFOLIO GEOGRAPHICAL Multifamily by State $428 Construction by State $78 EXPOSURE Other Illinois $15 3% $12 3% New York Other $23 $74 17% 28% California California $38 50% Texas $226 53% New York CRE Composition by State $101 24% $17 22% $3,975 ($ in millions) Illinois Other $103 3% $668 17% O
Slide 24: Loan Portfolio Distribution
LOAN PORTFOLIO DISTRIBUTION Residential Real CRE C&I Estate & Equipment Finance Owner Non-owner Lines of Residential Equipment ($ in millions) Multifamily Construction(1) Term(2) Occupied Occupied Credit(2) Real Estate Finance Total Balance $768 $2,702 $428 $79 $411 $443 $980 $473 Average $1.08 $3.1
Slide 25: Loan Portfolio Maturities
LOAN PORTFOLIO MATURITIES ($ in millions) <1 Year 1-3 Years >3 Years Total Real Estate Loans Retail $ 164.9 $ 311.4 $ 632.4 $ 1,108.7 Hospitality 161.3 294.7 389.3 845.3 Office 236.7 268.4 58.8 563.9 Other 305.1 509.9 564.1 1,379.1 Commercial Property $ 868.0 $ 1,384.4 $ 1,644.6 $ 3,897.0 Constructi
Slide 26: USKC Loans & Deposits
USKC (1) LOANS & DEPOSITS USKC Loans – Top 10 Industries (as of 1Q25) Auto Part Manufacturer USKC portfolio represented $931.9 million, or 15% 28% RE Investment 27% of the loan portfolio, and $968.5 million, or 15% of Hotel 20% the deposit portfolio. Food 5% Polyester Manufact 3% USKC CRE portfolio
Slide 27: Office Loan Portfolio
OFFICE LOAN PORTFOLIO Portfolio by State The CRE office portfolio(1) was $564.0 million(2) at 4% March 31, 2025, representing 9% of the total loan 1% portfolio. 12% 80% Remaining = 3% $4.5M 2.02x 55.27% Average balance of the portfolio Weighted average debt Weighted average coverage ratio(3) of the
Slide 28: Hospitality Segment
HOSPITALITY SEGMENT Hospitality segment represented $845.3 million(1), Hospitality by Type or 13% of the total loan portfolio and 21% of the Convention Center Airport total CRE portfolio at March 31, 2025. 5% 2% Resort 7% (2) $4.4M 2.1x 51.44% Destination / Metropolitan (3) Average balance of (3) th
Slide 29: Retail Segment
RETAIL SEGMENT Retail segment represents $1.11 billion (1), or 18% Percentage of Portfolio of the total loan portfolio and 28% of the total CRE portfolio at March 31, 2025. Illinois 2% Georgia Other 12% 3% (2) Texas 12% $1.5M 2.01x 46.11% California 71% Average balance of the (3) Weighted average de
Slide 30: Residential Real Estate Portfolio
RESIDENTIAL REAL ESTATE PORTFOLIO The RRE(1) portfolio was $979.5 million at March Percentage of Portfolio 31, 2025, representing 16% of the total loan portfolio. Jumbo QM Non-QM 2% (2) Our conservative underwriting policy focuses on high-quality mortgage originations with maximum Loan-to-Value (LTV
Slide 31: Equipment Finance Portfolio
EQUIPMENT FINANCE PORTFOLIO Portfolio by Equipment 32% 28% Equipment finance portfolio represented $472.6 million, or 8% of the loan portfolio, at March 31, 2025 7% 7% 7% 4% 4% 4% 4% 3% Portfolio by Industry Other Services 3% (1) Portfolio by State Other 14% Transportation Agriculture 3% 22% Wholesa
Slide 32: 1Q25 Financial Summary
1Q25 FINANCIAL SUMMARY Change (1) ($ in millions, except EPS) March 31, 2025 December 31, 2024 March 31, 2024 Q/Q Y/Y Income Statement Summary Net interest income before credit loss $ 55.1 $ 53.4 $ 50.7 3.1% 8.8% Noninterest income 7.7 7.4 7.7 5.0% -0.1% Operating revenue 62.8 60.8 58.4 3.3% 7.6% No
Slide 33: Non-GAAP Reconciliation: Tangible Common Equity to Tangible Asset Ratio
NON-GAAP RECONCILIATION: T A N G I BLE CO M M O N E Q U I T Y T O T A N G I BLE A S S E T R A T I O ($ in thousands, except per share data) March 31, December 31, September 30, June 30, March 31, Hanmi Financial Corporation 2025 2024 2024 2024 2024 Assets $ 7,729,035 $ 7,677,925 $ 7,712,299 $ 7,586,
Slide 34: Non-GAAP Reconciliation: Pro Forma Regulatory Capital
NON-GAAP RECONCILIATION: P R O FO R MA R E G U L A T O R Y C A P I T A L ($ in thousands) Company(1) Bank(1) Common Total Common Total Equity Tier 1 Tier 1 Risk-based Equity Tier 1 Tier 1 Risk-based Regulatory capital $788,625 $810,836 $994,327 $868,057 $868,057 $941,548 Unrealized losses on AFS sec