Hope Bancorp, Inc. · NASDAQ:HOPE
Hope Bancorp — Q4 2022 Earnings Presentation
17 slides from Hope Bancorp's earnings presentation, Jan 24, 2023
Slide 1: Fourth Quarter 2022 Earnings Conference Call
2022 Fourth Quarter Earnings Conference Call Tuesday, January 24, 2023
Slide 2: Forward Looking Statements & Additional Disclosures
Forward Looking Statements & Additional Disclosures This presentation may contain statements regarding future events or the future financial performance of the Company that constitute forward- looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section
Slide 3: 4Q22 & FY 2022 Financial Highlights
4Q22 & FY 2022 Financial Highlights Net Income Earnings & Profitability $51.7M (4Q22) • • Net interest income for 4Q22 decreased 2% Q-o-Q but increased 13% for the full year vs. 2021 Net interest margin for 4Q22 decreased 13bps Q-o-Q but increased 27bps for the full year vs. 2021 $218.3M (FY2022) •
Slide 4: Loan Production & Portfolio Trends
Loan Production & Portfolio Trends New Loan Originations Funded 16.75 Loans Receivable ($ Millions) ($ Billions) $1,349 16.25 Q-o-Q change $1,243 $1,286 $68 $15.49 $15.40 15.75 $81 $184 $1,026 15.25 $104 $793 -1% $539 $747 $557 $37 14.75 $14.55 $344 +6% 14.25 $13.95 $14.07 $432 13.75 +3% $623 $578 $
Slide 5: Transformation to Lower-Risk Loan Portfolio
Transformation to Lower-Risk Loan Portfolio % of CRE Portfolio CRE Loan Portfolio As of As of 12/31/2021 12/31/2022 Multi-tenant Retail 20% 20% Multi-family 8% 14% Industrial & Warehouse 14% 14% 5% 6% Gas Station & Car Wash 12% 11% Hotel/Motel 14% 10% Mixed Use 9% 9% 30% Single-tenant Retail 8% 8% $
Slide 6: Net Interest Income and Margin
Net Interest Income and Margin Net Interest Income & NIM Net Interest Margin ($ Millions) Q-o-Q increase +8bps +61bps +3bps $153.2 $150.5 Loan balance Inv securities increase decrease + $141.5 -2% yield increase + 3.49% cash yield +8% 3.36% $133.3 $133.2 Loan yield increase -74bps +6% 3.49% increase
Slide 7: Loan Portfolio Interest Rate Breakdown
Loan Portfolio Interest Rate Breakdown Fixed/Variable & Average Rate of New Loan Originations Fixed /Variable Breakdown of Total Loan Portfolio (As of 12/31/2022) (As of 12/31/2022) 120% 5.95% 7.18% 8.38% 6.12% 6.71% 100% 1% Hybrid 1 80% 30% 30% Variable 65% @4.07% 2 46% 60% 94% 92% 99% @7.31% 2 40%
Slide 8: Noninterest Income
Noninterest Income Noninterest Income • Noninterest income decreased 9% Q-o-Q to $12.1 million vs. ($ Millions) $13.4 million in 3Q22 – Gains on sales of SBA loans decreased to $2.2 million from $2.8 $13.1 $13.2 $12.7 $13.4 million in 3Q22 $12.1 $2.3 $2.7 $4.3 $5.2 – Other income and fees decreased
Slide 9: Noninterest Expense and Efficiency
Noninterest Expense and Efficiency Noninterest Expense & FTE Efficiency Ratio & ($ Millions) Noninterest Expense to Average Assets $83.9 $84.5 $80.4 $74.2 $75.4 $10.8 $11.4 $6.3 $7.0 $6.3 $2.9 $1.3 $0.6 $1.7 $1.5 $20.1 $18.7 $19.8 52.09% 51.97% $19.9 51.50% $21.0 $53.2 $52.7 50.70% 50.39% $51.1 $47.
Slide 10: Deposit Trends
Deposit Trends Deposit Composition Deposit Costs Average Deposits ($ Billions) ($ Billions) Q-o-Q growth annualized $15.07 $15.45 $15.48 $15.74 $14.95 $14.80 $15.04 $15.03 $15.50 2.44% $14.52 $2.8 $2.2 $2.7 +3% $3.7 +2% $5.7 $5.2 -3% +4% $5.0 $6.0 $5.7 $5.7 $0.3 $0.3 $0.3 $0.3 $0.3 1.62% $6.2 $6.5 $
Slide 11: Asset Quality
Asset Quality Nonperforming Assets Total Criticized Loans Provision (Credit) for Credit Losses ($ Millions) ($ Millions) & Net Charge Offs (Recoveries) ($ Millions) $111.8 $110.6 3.58% $2.6 $102.4 $2.0 $97.0 2.80% $109.2 $2.0 $108.6 $1.5 2.34% $100.4 $499.6 1.83% 1.70% $95.5 $69.4 $9.2 $242.4 $393.6
Slide 12: Capital Position & Returns
Capital Position & Returns Capital Positions Dividends & Buybacks ($ Millions) $12.96 $12.60 11.97% $14.7 11.72% 11.15% 10.92% $2.8 10.55% 10.25% 10.15% 10.32% $16.8 $16.8 $16.9 $16.7 $16.7 Total Risk-Based Tier 1 Leverage Tier 1 Common Tier 1 Tangible 4Q21 1Q22 2Q22 3Q22 4Q22 Capital Ratio Ratio Eq
Slide 13: 2022 Performance vs. Outlook
2022 Performance vs. Outlook Initial 2022 Outlook Actual 2022 Performance Re-energized focus on business development expected to Loan Growth lead to high single-digit to low double-digit loan growth for 2022, excluding PPP Achieved higher end of guidance with 12.2% loan growth, excluding SBA PPP N
Slide 14: 2023 & Near-Term Outlook
2023 & Near-Term Outlook Loan Growth: Full-year loan growth projected in the mid-single digit range, reflective of more prudent and selective approach to new loan production Net Interest Income: Anticipate modest net interest income growth for the full-year driven by increased earnings assets pa
Slide 15: Fourth Quarter Q&A
2022 Fourth Quarter Earnings Conference Call Q&A 15
Slide 16: Appendix
Appendix 16
Slide 17: Appendix: Non-GAAP Financials
Appendix: Non-GAAP Financials Management reviews select non-GAAP financial measures in evaluating the Company’s financial performance and in response to market participant interest. A reconciliation of the most directly comparable GAAP to non-GAAP financial measures utilized by management is provide