Hanmi Financial Corporation · NASDAQ:HAFC
Hanmi Financial — Q2 2021 Earnings Presentation
23 slides from Hanmi Financial's earnings presentation, Jul 27, 2021
Slide 1: 2Q21 Earnings Supplemental Presentation
2Q21 Earnings Supplemental Presentation July 27, 2021 1
Slide 2: 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, incl
Slide 3: 2Q21 Highlights
2Q21 Highlights Net Income Diluted EPS ROAA NIM Efficiency Ratio TBVPS* $22.1M $0.72 1.38% 3.19% 52.66% $19.27 • Net income of $22.1 million, or $0.72 per diluted share, up 32.8% from $16.7 million, or $0.54 per diluted share, from the prior quarter • Loans receivable of $4.82 billion, unchanged fro
Slide 4: 2Q21 Financial Summary
2Q21 Financial Summary ($ million, except EPS) Change (1,2) 2Q21 1Q21 2Q20 Q/Q Y/Y Income Statement Summary Net interest income $ 49.6 $ 46.0 $ 44.4 7.8% 11.5% Noninterest income 8.9 9.8 20.9 -9.4% -57.5% Operating revenue 58.5 55.8 65.4 4.7% -10.6% Noninterest expense 30.8 29.5 27.1 4.2% 13.4% Cred
Slide 5: Loan Portfolio Composition
Loan Portfolio Composition $4.82 Billion Loan Portfolio (as of 2Q21) Commercial Real Estate Portfolio Loan Portfolio Composition $ in millions Outstanding $3,452 Average Size $1.7 QTD Average Yield 4.35% RRE & Consumer Portfolio(1) (1) RRE $ in millions 7% Outstanding $349 Average Size $0.4 QTD Aver
Slide 6: Loan Portfolio Diversification
Loan Portfolio Diversification Loan portfolio is well diversified across property and business types. CRE Portfolio C&I Portfolio $3.45B $588M Wholesale Other Trade 15% 15% Hospitality Mixed Use 25% 5% Other (1) Industrial 38% Manufacturing 6% 18% Apartment Retail 8% 25% Gas Services Station 9% 6% O
Slide 7: Excellent Modification Trend
Excellent Modification Trend 95% decline in modifications since June 30, 2020 – from $1.4B to $72M as of June 30, 2021 Modified portfolio represents 1.5% of loans receivable as of June 30, 2021 Deferment Modified Payment 1 $593 $1,408 $600 Modified & Deferred Payments as of June 30, 2020 Modifie
Slide 8: Hospitality Segment by Location Type
Hospitality Segment by Location Type Hospitality segment(1) is $847 million, representing 18% of the loan portfolio. Convention Center 3% Casino 3% Hospitality Portfolio Detail • Average balance within the segment was Airport $3.2 million 7% • Weighted average debt coverage ratio of the segment was
Slide 9: Adjusted Pretax Pre-Provision Income
Adjusted Pretax Pre-Provision Income(3) ($ millions) 2Q21 1Q21 4Q20 3Q20 2Q20 • Adjusted operating revenue(3) increased by 10% Income Statement Summary quarter-over-quarter Net interest income $ 49.6 $ 46.0 $ 46.9 $ 45.6 $ 44.4 • Adjusted operating revenue(3) includes non- Adjusted Noninterest incom
Slide 10: Net Interest Income / Net Interest Margin
Net Interest Income / Net Interest Margin Net interest income was $49.6 million for the second quarter compared with $46.0 million for the prior quarter; net interest margin for the quarter was 3.19% (3.12%(1) excluding PPP loans) compared with 3.09% for the prior quarter (3.13%(1) excluding PPP loa
Slide 11: ACL Analysis
ACL Analysis Allowance for credit losses was $83.4 million as of June 30, 2021 generating an allowance for credit losses to loans of 1.73% (1.78%(1) excluding PPP loans) compared with 1.83% (1.94%(1) excluding the PPP loans) at the end of the prior quarter. COVERAGE 1.83% 1.73% RATIO $88.4 $83.4 $0.
Slide 12: ACL by Loan Components
ACL by Loan Components ($ millions) June 30, 2021 March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 Allowance Loans Allowance Loans Allowance Loans Allowance Loans Allowance Loans Loan Components CRE $ 62.3 $ 3,452.0 $ 57.0 $ 3,372.3 $ 50.5 $ 3,353.8 $ 47.8 $ 3,264.4 $ 53.6 $ 3,266.2
Slide 13: Asset Quality – Criticized Loans
Asset Quality – Criticized Loans Total criticized loans decreased by 5% quarter-over-quarter. ($ millions) June 30, March 31, Additions / Reductions / Pandemic- 2021 2021 Downgrades Upgrades impacted Special Mention $ 121.8 $ 96.1 $ 49.5 $ 23.8 $ 70.8 Classified $ 110.1 $ 147.4 $ 10.8 $ 48.1 $ 63.3
Slide 14: Asset Quality – Nonaccrual Loans
Asset Quality – Nonaccrual Loans Nonaccrual loans(3) decreased 28% quarter-over-quarter. 47% of nonaccruals represent three loans of $3 million or more. $55.1(1) CRE - Hospitality $8.9 CRE - Construction/land $39.6(1) $11.0 CRE - Hospitality $9.1 C&I - Film tax credit loans $12.4 CRE - Construction/
Slide 15: Liquidity
Liquidity Hanmi Financial’s cash and due from banks to assets ratio increased from 10% to almost 11% quarter-over-quarter. Cash and Due From Banks as a Liquid Asset Ratio(1) Percentage of Total Assets 22.2% 23.7% 10.0% 10.6% 18.8% 17.4% 18.2% 8.9% 5.9% 6.3% 2Q20 3Q20 4Q20 1Q21 2Q21 2Q20 3Q20 4Q20 1Q
Slide 16: Securities Portfolio
Securities Portfolio The composition of the securities portfolio includes 6% allocation of municipal securities. ($ thousands) June 30, 2021 March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 Fair TE Yield Asset Fair TE Yield Asset Fair TE Yield Asset Fair TE Yield Asset Fair TE Yield
Slide 17: Non-GAAP Reconciliation
Non-GAAP Reconciliation ($ thousands, except share, per share data and ratios) June 30, March 31, December 31, September 30, June 30, 2021 2021 2020 2020 2020 Tangible Common Equity to Tangible Assets Ratio Assets $ 6,578,856 $ 6,438,401 $ 6,201,888 $ 6,106,782 $ 6,218,163 Less goodwill and other in
Slide 18: Non-GAAP Reconciliation: Pretax Pre-Provision Income
Non-GAAP Reconciliation: Pretax Pre-Provision Income ($ millions) 2Q21 1Q21 4Q20 3Q20 2Q20 Pretax income $ 31.0 $ 24.2 $ 19.7 $ 22.8 $ 13.6 less credit loss expense (3.3) 2.1 5.1 - 24.6 Pretax, Pre-provision, income $ 27.7 $ 26.3 $ 24.8 $ 22.8 $ 38.2 less income from PPP gains (0.2) (2.5) - - - less
Slide 19: Non-GAAP Reconciliation – PPP (2Q21)
Non-GAAP Reconciliation – PPP (2Q21) ($ in thousands, except share and per share data) Three Months Ended As of June 30, 2021 June 30, 2021 Tangible Common Equity to Tangible Assets Net Interest Margin Tangible assets $ 6,567,352 Net interest income $ 49,572 Less first and second draw PPP loans (158
Slide 20: Non-GAAP Reconciliation – PPP (1Q21)
Non-GAAP Reconciliation – PPP (1Q21) ($ in thousands, except share and per share data) Three Months Ended As of March 31, 2021 March 31, 2021 Tangible Common Equity to Tangible Assets Net Interest Margin Tangible assets $ 6,426,843 Net interest income $ 46,001 Less first and second draw PPP loans (2
Slide 21: Non-GAAP Reconciliation – PPP (4Q20)
Non-GAAP Reconciliation – PPP (4Q20) ($ in thousands, except share and per share data) Three Months Ended As of December 31, 2020 December 31, 2020 Tangible Common Equity to Tangible Assets Net Interest Margin Tangible assets $ 6,190,276 Net interest income $ 46,877 Less PPP loans (295,702) Less PPP
Slide 22: Non-GAAP Reconciliation – PPP (3Q20)
Non-GAAP Reconciliation – PPP (3Q20) ($ in thousands, except share and per share data) Three Months Ended As of September 30, 2020 September 30, 2020 Tangible Common Equity to Tangible Assets Net Interest Margin Tangible assets $ 6,095,105 Net interest income $ 45,605 Less PPP loans (302,929) Less P
Slide 23: Non-GAAP Reconciliation – PPP (2Q20)
Non-GAAP Reconciliation – PPP (2Q20) ($ in thousands, except share and per share data) Three Months Ended As of June 30, 2020 June 30, 2020 Tangible Common Equity to Tangible Assets Net Interest Margin Tangible assets $ 6,206,421 Net interest income $ 44,442 Less PPP loans (301,836) Less PPP loan in