Hope Bancorp, Inc. · NASDAQ:HOPE
Hope Bancorp — Q3 2021 Earnings Presentation
15 slides from Hope Bancorp's earnings presentation, Oct 26, 2021
Slide 1: 2021 Third Quarter Earnings Conference Call
2021 Third Quarter Earnings Conference Call Tuesday, October 26, 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: Q3 2021 Financial Highlights
Q3 2021 Financial Highlights Net Income EPS (diluted) Gross Loans Total Deposits $55.5MM $0.45 $13.42B $15.06B Earnings & Profitability Deposit Trends • Net interest income before provision (credit) for credit • Noninterest bearing deposits increased 7% Q‐o‐Q and loss increased 3% to $130.3 million,
Slide 4: Loan Production & Portfolio Trends
Loan Production & Portfolio Trends New loan originations funded increased to record high ($ millions) New Loan Originations Funded $1.01 billion Strong contributions coming from all areas of lending, each of which achieved a higher level of production Q‐o‐Q Q‐o‐Q increase 3.37%1 Mix of loan or
Slide 5: Net Interest Income and Margin
Net Interest Income and Margin Net Interest Income & NIM Q‐o‐Q growth $130.3 5 consecutive quarters of +3% $126.6 increasing net interest income +3% $122.6 $120.8 +2% 3.11% +2bps +3% 3.06% 3.07% $117.6 3.02% Invest‐ 2.91% ment yield ‐8bps +4bps increase 3.11% Deposit cost decline 3Q20 4Q20 1Q21 2Q21
Slide 6: Interest Rate Risk
Interest Rate Risk New Loan Fixed/Variable Fixed / Variable Breakdown and Average Rate (As of 9/30/2021) 3.44% 1 3.37% 1 3.36% 3.27% Hybrid 1 29% Variable 2.88% @4.12% 2 41% 32% 64% 50% @3.27% 2 71% 67% 68% Fixed 50% 31% 33% 36% 29% @3.64% 2, 3 3Q20 4Q20 1Q21 2Q21 3Q21 Fixed Variable Avg Rate 1 Hybr
Slide 7: Noninterest Income
Noninterest Income Customer‐Related Fee Income* and ($ millions) Net Gain on Sale of Loans $10.4 $10.2 $9.9 Customer‐related noninterest fee income and net gain on $9.6 $1.6 sale of loans decreased slightly to $9.6 million in 3Q21 vs. $2.9 $8.2 $9.9 million in 2Q21 $2.4 $2.5 $300,000 decrease dr
Slide 8: Noninterest Expense and Efficiency
Noninterest Expense and Efficiency Efficiency Ratio & Noninterest Expense to Breakdown of Noninterest Expense & FTE ($ millions) Average Assets 54.31% 53.77% $73.4 $73.1 $75.5 53.61% 53.12% 53.58% $71.1 $70.4 $3.61 $2.13 $6.4 $2.42 $7.0 $6.3 $1.5 $7.3 $7.6 $0.3 $2.5 1.73% 1.69% 1.70% 1.70% $3.6 $1.9
Slide 9: Deposit Trends
Deposit Trends Q‐o‐Q growth annualized Deposit Composition ($ billions) Noninterest bearing demand deposits increased 7% Q‐o‐Q and accounted for a record 40% of total deposits at 9/30/21 $14.33 $14.30 $14.73 $15.06 $14.01 MMA & NOW deposits increased 1% Q‐o‐Q and accounted for +12% +9% +9% ‐1% $
Slide 10: Asset Quality
Asset Quality Nonperforming Assets Provision (Credit) for Credit Losses & ($ millions) ($ millions) Net Charge Offs 1.28% $183.7 $27.5 $170.5 $16.6 $143.3 $18.5 $22.0 $124.6 $167.1 $20.1 $152.0 $113.7 $18.4 0.35% $123.2 $15.2 $106.2 1.05% 0.12% 0.99% $98.5 0.02% $3.3 0.84% ‐$10.0 0.74% ‐$7.0 0.64% 0
Slide 11: Allocation of Allowance by Loan Type
Allocation of Allowance by Loan Type ($ thousands) Allocation of Allowance for Credit Losses Q‐o‐Q Change Sep 30, 2020 Jun 30, 2021 Sep 30, 2021 2Q21 to 3Q21 Coverage Coverage Coverage Coverage Loan Type Amount Amount Amount Amount Ratio Ratio Ratio Ratio Commercial RE $ 129,624 1.51% $ 155,253 1.76
Slide 12: Strong Capital Position & Returns
Strong Capital Position & Returns Capital Positions Dividends & Buybacks ($ millions) 13.16% 12.42% 12.14% 11.70% 11.44% 11.01% $47.2 10.43% 9.98% $17.3 $17.3 $17.3 $17.3 $17.3 Total Risk‐ Tier 1 Leverage Tier 1 Common Tier 1 Capital 3Q20 4Q20 1Q21 2Q21 3Q21 Based Capital Ratio Equity Ratio Ratio Ra
Slide 13: Near-Term Outlook
Near-Term Outlook Loan Growth: Robust loan pipeline and strengthened focus on business development to lead to organic loan growth in the quarters ahead Noninterest Expenses: Decreasing trend from 3Q21 to normalized range of $72 to $74 million Net Interest Margin: Relatively stable in 4Q21 in l
Slide 14: 2021 Third Quarter Earnings Conference Call Q&A
2021 Third Quarter Earnings Conference Call Q&A 14
Slide 15: Appendix: Non-GAAP Financials
Appendix: Non-GAAP Financials Loans Receivable, excluding PPP forgiveness, strategic loan sales and transfer to loans held‐for‐sale ($ in thousands) 3Q21 Loans receivable beginning balance $ 13,424,301 Loans receivable ending balance $ 13,418,691 Loan balance change (as reported) $ (5,610) Quarter‐o