Hope Bancorp, Inc. · NASDAQ:HOPE
Hope Bancorp — Q2 2021 Earnings Presentation
15 slides from Hope Bancorp's earnings presentation, Jul 21, 2021
Slide 1: 2021 Second Quarter Earnings Conference Call
2021 Second Quarter Earnings Conference Call Wednesday, July 21, 2021 1
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: Q2 2021 Financial Highlights
Q2 2021 Financial Highlights Net Income EPS (diluted) Gross Loans Total Deposits $53.8MM $0.43 $13.42B $14.73B Earnings & Profitability Deposit Trends • Net interest income before provision for credit loss • Noninterest bearing deposits increased 4% Q‐o‐Q to a increased 3% to $126.6 million – 4th co
Slide 4: Loan Production & Portfolio Trends
Loan Production & Portfolio Trends New Loan Originations Funded ($ millions) New loan originations funded increased to record high 3.39%1 3.38%1 $894.1 million 3.27% 3.44%1 2.88% $894.1 Excluding PPP loans, new loan production increased $832.0 $844.2 $847.1 $53 61% to $874.3 million from $542.4
Slide 5: Active COVID-19 Loan Modifications & Expiration Schedule
Active COVID-19 Loan Modifications & Expiration Schedule • Active modifications outstanding as of 6/30/2021 totaled $319 million, or 2.4% of total loan portfolio • Based on modifications expiration schedule, active modifications outstanding expected to decrease substantially to less than 1% of total
Slide 6: COVID-19 Impacted Portfolios - Hotel/Motel and Retail CRE
COVID-19 Impacted Portfolios - Hotel/Motel and Retail CRE - Hotel/Motel CRE Property Characteristics Retail CRE Property Characteristics • Largely represents “strip mall” type of properties (not shopping • Majority of Hotel/Motel properties are limited service facilities malls) • Less impacted by lo
Slide 7: Net Interest Income and Margin
Net Interest Income and Margin Average Loan Yield & Average 1M LIBOR Rate Net Interest Income & NIM ($ millions) 4.23% 4.20% $126.6 4.03% 3.94% 3.98% $120.8 $122.6 $117.6 $109.8 3.02% 3.06% 3.11% 0.35% 2.91% 0.16% 0.15% 2.79% 0.12% 0.10% 2Q20 3Q20 4Q20 1Q21 2Q21 2Q20 3Q20 4Q20 1Q21 2Q21 Net Interest
Slide 8: Noninterest Income
Noninterest Income Noninterest Income Noninterest income increased to $11.1 million ($ millions) in 2Q21 vs. $8.8 million in 1Q21 driven by: $17.5 $1.7 $2.4 million gain on sales of SBA loans $1.1 million decrease in gain on sale of other loans reflecting lower level of $11.2 $7.5 $11.4 $11.1
Slide 9: Noninterest Expense and Efficiency
Noninterest Expense and Efficiency Efficiency Ratio & Noninterest Expense to Breakdown of Noninterest Expense & FTE ($ millions) Average Assets $73.4 55.37% $73.1 $71.1 $70.4 54.31% 53.77% 53.61% $67.0 $3.61 $2.13 53.12% $2.42 $7.0 $6.3 $7.3 $7.6 $7.0 $2.5 $0.3 $3.6 $1.9 $2.7 $22.1 1.73% 1.70% $19.7
Slide 10: Deposit Trends
Deposit Trends Q‐o‐Q growth annualized Deposit Composition ($ billions) Noninterest bearing demand deposits increased 4% Q‐o‐Q and accounted for 38% of total deposits at 6/30/21 $14.12 $14.01 $14.33 $14.30 $14.73 +12% MMA & NOW deposits increased 16% Q‐o‐Q and accounted for ‐3% +9% ‐1% $3.0 39%
Slide 11: Asset Quality
Asset Quality Nonperforming Assets Provision (Credit) for Credit Losses & ($ millions) ($ millions) Net Charge Offs $183.7 $27.5 $170.5 $16.6 0.35%1 $147.6 $143.3 $18.5 $22.0 $124.6 $167.1 $17.5 $21.0 $20.1 $152.0 $126.6 $18.4 $123.2 $106.2 0.99% 1.05% 0.02% 0.02% $3.3 0.86% 0.84% 0.12% 0.74% 0.06%
Slide 12: Allocation of Allowance by Loan Type
Allocation of Allowance by Loan Type ($ thousands) Allocation of Allowance for Credit Losses Quarter‐over‐ Quarter Change 1Q21 to 2Q21 June 30, 2020 Mar 31, 2021 Jun 30, 2021 Coverage Coverage Coverage Coverage Loan Type Amount Amount Amount Amount Ratio Ratio Ratio Ratio Commercial RE $ 119,030 1.3
Slide 13: Strong Capital Position
Strong Capital Position 13.16% 13.03% 12.02% 11.32% 11.78% 11.08% 10.34% 10.15% 10.00% 8.00% 6.50% 5.00% Total Risk‐Based Capital Ratio Tier 1 Leverage Ratio Tier 1 Common Equity Ratio Tier 1 Capital Ratio Min. Guideline Well Capitalized Institution 3/31/2021 6/30/2021 Maintaining strong level of ca
Slide 14: Near-Term Outlook
Near-Term Outlook Loan Growth: Revised to flat to nominal net loan growth for 2021 – reflecting lower warehouse line balances due to interest rate environment, higher payoffs due to competitive environment and PPP forgiveness, strategic loan sale de‐risking hotel/motel portfolio and resumption of
Slide 15: 2021 Second Quarter Earnings Conference Call Q&A
2021 Second Quarter Earnings Conference Call Q&A 15