Hanmi Financial Corporation · NASDAQ:HAFC
Hanmi Financial — Cohen Bros. & Company First Annual Investors Conference 2005
29 slides from Hanmi Financial's conference presentation, Mar 18, 2005
Slide 1: Hanmi Financial Corporation - Cohen Bros. First Annual Investors Conference
HANMI FINANCIAL CORPORATION Nasdaq: HAFC Cohen Bros. & Company First Annual Investors Conference March 18, 2005
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements contained in this presentation, including, without limitation, statements containing the words "believes," "plans," "expects," "anticipates," and words of similar import, constitute "forward-looking statements" within the meaning of the Private Securities Lit
Slide 3: Stock Summary
Stock Summary Ticker Symbol: HAFC (Nasdaq) Recent Price1: $17.40 Shares Outstanding1: 49.6 million Market Capitalization1: $863 million Average Daily Volume2: 221,939 shares Trailing Twelve Months Price/Earnings Ratio3: 20.7 Annual Dividend: $0.20 per share Current Dividend Yield1: 1.15% 1. As of Ma
Slide 4: Company Profile
Company Profile A leader in a high-growth niche market serving the Korean-American and other ethnic communities The 14th largest bank headquartered in California with $3.1 billion in assets as of December 31, 2004 Strong asset growth: 5-year CAGR of 33.2%
Slide 5: Korean-American Market Overview
Korean-American Market Overview One of the fastest growing ethnic groups 54% growth in the 1990s vs. 13% general population 5-year CAGR of publicly traded Korean-American banks1 as of December 31, 2004 Total assets: 25% Total loans: 29% Total deposits: 24% California has the highest Korean-American
Slide 6: Target Market Growth Drivers
Target Market Growth Drivers Increased wealth in the Korean-American community Continuing immigration trend from Korea Unstable political/economic situation in Korea Better education opportunity for immigrants' children Investment diversification Characteristics of recent Korean immigrants Higher ne
Slide 7: Historical Highlights - Hanmi Bank
Historical Highlights - Hanmi Bank 1982 -The first Korean-American bank founded by local Korean-Americans 2001 - IPO on NASDAQ 2004 -Acquired Pacific Union Bank, which was founded in 1974 2005 - Appointed Dr. Sung Won Sohn as President and CEO
Slide 8: Experienced Management Team
Experienced Management Team Name Title Banking Experience Dr. Sung Won Sohn President and CEO 31 years Michael J. Winiarski SVP and CFO 25 years David W. Kim SVP and CAO 15 years Suki H. Murayama SVP and Regional Executive Officer 29 years Eunice U. Lim SVP and Acting CCO 24 years
Slide 9: Hanmi's Business Focus
Hanmi’s Business Focus Commercial and retail banking Primary focus: Korean-American community Cultivate banking relationships with other multi-ethnic communities Full suite of financial products and services Traditional depository, loan, and trade finance products Investment and insurance products P
Slide 10: Loan & Deposits Market Shares
Loan & Deposits Market Shares Hanmi: Nearly 50% market share among publicly traded Korean-American banks in California HAFC 0.45 NARA 0.15 CLFC 0.21 WIBC 0.19 Deposits Net Loans Note: As of December 31, 2004 based on SEC filings of each company. Excludes 30% of NARA's balances, which are not from Ca
Slide 11: Business Initiatives: 2004
Business Initiatives: 2004 Increased focus on profitability Margin expansion Transitioning into performance-based management Management realignment Retained high-performing senior executives Appointed experienced non-Koreans into key management positions Completed acquisition of a competitor - Pacif
Slide 12: Business Initiatives: 2005
Business Initiatives: 2005 Emphasis on sales culture Strengthen customer relationships via cross-selling Continued focus on profitability Realization of post-merger integration efficiencies Network expansion Shift towards fee-based products and services
Slide 13: Consistent Balance Sheet Growth
($ in millions) 2000 2001 2002 2003 2004 Loans 620 820 1000 1270 2235 Deposits 940 1040 1290 1450 2529 Assets 1030 1160 1460 1790 3104 Financial Performance Consistent Balance Sheet Growth
Slide 14: Loan Portfolio
Loan Portfolio As of December 31, 2004 Construction Loans 87855 Consumer Loans 169648 Commercial Real Estate Loans 1397124 C & I Loans 581917 Other Loans 26097
Slide 15: Specialty Lending Activities
Specialty Lending Activities Robust SBA loan production 4th largest SBA lender in LA district in 2004 8th largest SBA lender in California in 2003 Specialized in low income housing lending $49 million low income housing loans booked in 2004 Sponsored six recipients of AHP grants awarded by the FHLB
Slide 16: Korean vs. Non-Korean Business
Korean vs. Non-Korean Business 2000 2001 2002 2003 2004 Korean New Loans 221.1 245.7 287.4 344.5 452.4 Non-Korean New Loans 75.4 136.3 165.5 278.4 339.3 ($ in millions) Hanmi has extended service to neighboring ethnic communities. 45% 25% 43% 36% 37%
Slide 17: Sound Asset Quality
Sound Asset Quality Loan Loss Allowance/Gross Loans 2000 2001 2002 2003 6/26/1905 Hanmi 0.0178 0.0119 0.0114 0.0106 0.01 Non Performing Assets/Total Assets 2000 2001 2002 2003 6/26/1905 Hanmi 0.0025 0.0043 0.0044 0.0048 0.0019
Slide 18: Solid Deposits Franchise
Solid Deposits Franchise 2003 1Q 2003 2Q 2003 3Q 2003 4Q 2004 1Q 2004 2Q 2004 3Q 2004 4Q Non-interest bearing 400 440 460 480 490 760 720 730 Savings and money market 290 300 300 300 380 660 740 768 Certificates of deposit 650 720 740 670 610 930 950 1032 ($ in millions)
Slide 19: Deposits Composition
Deposits Composition Non-Interest Bearing 729583 TDs of $100,000 or More 756580 TDs of Less than $100,000 275120 Interest Bearing Demand and Savings 767524 As of December 31, 2004
Slide 20: Revenue Growth
Revenue Growth 2000 2001 2002 2003 2004 Net interest income 41.54 43.95 48.26 56.97 102 Non-interest income 12.11 12.53 13.19 15.05 20.14 ($ in millions)
Slide 21: Net Income and Diluted EPS
Net Income and Diluted EPS Diluted EPS* 2000 2001 2002 2003 2004 Net Income 15.5 16.8 17 19.2 36.7 Net Income ($ in millions) 2000 2001 2002 2003 2004 Diluted EPS 0.57 0.6 0.6 0.67 0.84 *Reflects recent 2:1 stock split
Slide 22: Return on Average Equity / Assets
Return on Average Equity / Assets ROA ROE 2000 2001 2002 2003 2004 ROE 0.1981 0.1756 0.1508 0.1451 0.1251 ROA 0.0178 0.0153 0.013 0.0118 0.0137 ROTE 0.2045 0.1798 0.1535 0.1475 0.2573 25.73%
Slide 23: Net Interest Margin Trend
Net Interest Margin Trend 2002 Q3 2002 Q4 2003 Q1 2003 Q2 2003 Q3 2003 Q4 2004 Q1 2004 Q2 2004 Q3 2004 Q4 NIM 0.0407 0.0376 0.0348 0.0361 0.0369 0.0373 0.0405 0.041 0.0442 0.0457 Wall Street Prime
Slide 24: Profitability Ratio Trends
Profitability Ratio Trends 3Q 03 4Q 03 1Q 04 2Q 04 3Q 04 4Q 04 Yield 4.99 % 5.23 % 5.29 % 5.36 % 5.79 % 6.15% Cost of Funds 1.90 % 1.78 % 1.79 % 1.79 % 1.89 % 2.19% Spread 3.09 % 3.45 % 3.50 % 3.57 % 3.90 % 3.96% NIM 3.69 % 3.99 % 4.05 % 4.10 % 4.42 % 4.57 %
Slide 25: Efficiency Ratio Trend
Efficiency Ratio Trend *5.57% *Reflects restructuring expenses related to the PUB merger 2002 Q4 2003 Q1 2003 Q2 2003 Q3 2003 Q4 2004 Q1 2004 Q2 2004 Q3 2004 Q4 Efficiency Ratio 0.5565 0.5374 0.528 0.5123 0.5131 0.4777 0.5181 0.5029 0.4951 Acquisition 0 0 0 0 0 0 0.0557 0.0087 *0.87%
Slide 26: PUB Merger Progress
PUB Merger Progress Integration substantially completed On track to achieve annualized cost savings of an estimated $10.9 million Finalized major MIS vendor relationships System conversion completed in August 5 branches closed Number of employees reduced to 521 from 670 Successful customer retention
Slide 27: Successful Customer Retention
Successful Customer Retention ($ in millions) December 31, 2003 April 30, 20041 June 30, 20042 September 30, 2004 December 31, 2004 Total Branch Deposits $789 $811 $748 $742 $755 Gross Loans $873 $876 $844 $824 $826 Former Pacific Union Bank 1Closing date of merger 2Reflects $54 million intentional
Slide 28: Stock Performance
Stock Performance Investing $100 (price reflects dividends) HAFC NASDAQ S & P Financials 12/1/2000 100 100 100 20.4 1/1/2004 115.11 112.23 99.57 31.6 2/1/2004 115.11 87.1 92.89 43.9 3/1/2004 117.02 74.49 90 4/1/2004 111.95 85.66 93.22 5/1/2004 116.01 85.43 96.79 6/1/2004 131.91 87.45 96.67 7/1/2004
Slide 29: Compelling Investment Opportunity
Compelling Investment Opportunity Dominant franchise in the attractive, high growth California-based Korean-American marketplace Proven expertise serving growing immigrant markets Experienced management team High quality loan portfolio coupled with attractive core deposit franchise Balance sheet wel
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