UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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|
☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the Quarterly Period Ended March 31, 2025
or
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☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the Transition Period From To
Commission File Number: 000-30421
HANMI FINANCIAL CORPORATION
(Exact Name of Registrant as Specified in its Charter)
|
|
|
Delaware |
|
95-4788120 |
(State or Other Jurisdiction of |
|
(I.R.S. Employer |
Incorporation or Organization) |
|
Identification No.) |
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|
|
900 Wilshire Boulevard, Suite 1250 |
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|
Los Angeles, California |
|
90017 |
(Address of Principal Executive Offices) |
|
(Zip Code) |
(213) 382-2200
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)
Securities Registered Pursuant to Section 12(b) of the Act:
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Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
Common Stock, $0.001 par value |
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HAFC |
|
Nasdaq Global Select Market |
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Large accelerated filer |
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☐ |
|
Accelerated filer |
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☒ |
Non-accelerated filer |
|
☐ |
|
Smaller reporting company |
|
☐ |
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|
|
|
Emerging Growth Company |
|
☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
As of April 30, 2025, there were 30,212,095 outstanding shares of the Registrant’s Common Stock.
Item 1. Financial Statements
Hanmi Financial Corporation and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share data)
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|
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|
|
|
|
|
|
March 31, |
|
|
December 31, |
|
|
|
2025 |
|
|
2024 |
|
|
|
(Unaudited) |
|
|
|
|
Assets |
|
|
|
|
|
|
Cash and due from banks |
|
$ |
329,003 |
|
|
$ |
304,800 |
|
Securities available for sale, at fair value (amortized cost of $991,234 and $1,004,563 as of March 31, 2025 and December 31, 2024, respectively) |
|
|
907,011 |
|
|
|
905,798 |
|
Loans held for sale, at the lower of cost or fair value |
|
|
11,831 |
|
|
|
8,579 |
|
Loans receivable, net of allowance for credit losses of $70,597 and $70,147 as of March 31, 2025 and December 31, 2024, respectively |
|
|
6,211,592 |
|
|
|
6,181,230 |
|
Accrued interest receivable |
|
|
23,536 |
|
|
|
22,937 |
|
Premises and equipment, net |
|
|
20,866 |
|
|
|
21,404 |
|
Customers' liability on acceptances |
|
|
552 |
|
|
|
1,226 |
|
Servicing assets |
|
|
6,422 |
|
|
|
6,457 |
|
Goodwill and other intangible assets, net |
|
|
11,031 |
|
|
|
11,031 |
|
Federal Home Loan Bank ("FHLB") stock, at cost |
|
|
16,385 |
|
|
|
16,385 |
|
Income tax assets |
|
|
38,058 |
|
|
|
44,901 |
|
Bank-owned life insurance |
|
|
57,476 |
|
|
|
57,168 |
|
Prepaid expenses and other assets |
|
|
95,272 |
|
|
|
96,009 |
|
Total assets |
|
$ |
7,729,035 |
|
|
$ |
7,677,925 |
|
|
|
|
|
|
|
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
Noninterest-bearing |
|
$ |
2,066,659 |
|
|
$ |
2,096,634 |
|
Interest-bearing |
|
|
4,552,816 |
|
|
|
4,339,142 |
|
Total deposits |
|
|
6,619,475 |
|
|
|
6,435,776 |
|
Accrued interest payable |
|
|
29,646 |
|
|
|
34,824 |
|
Bank's liability on acceptances |
|
|
552 |
|
|
|
1,226 |
|
Borrowings |
|
|
117,500 |
|
|
|
262,500 |
|
Subordinated debentures |
|
|
130,799 |
|
|
|
130,638 |
|
Accrued expenses and other liabilities |
|
|
79,578 |
|
|
|
80,787 |
|
Total liabilities |
|
|
6,977,550 |
|
|
|
6,945,751 |
|
Stockholders’ equity: |
|
|
|
|
|
|
Preferred stock, $0.001 par value; authorized 10,000,000 shares; no shares issued as of March 31, 2025 and December 31, 2024 |
|
|
— |
|
|
|
— |
|
Common stock, $0.001 par value; authorized 62,500,000 shares; issued 34,265,030 shares (30,233,514 shares outstanding) and 34,151,464 shares (30,195,999 shares outstanding) as of March 31, 2025 and December 31, 2024, respectively |
|
|
34 |
|
|
|
34 |
|
Additional paid-in capital |
|
|
591,942 |
|
|
|
591,069 |
|
Accumulated other comprehensive loss, net of tax benefit of $24,320 and $28,576 as of March 31, 2025 and December 31, 2024, respectively |
|
|
(60,002 |
) |
|
|
(70,723 |
) |
Retained earnings |
|
|
360,289 |
|
|
|
350,869 |
|
Less treasury stock; 4,031,516 shares and 3,955,465 shares as of March 31, 2025 and December 31, 2024, respectively |
|
|
(140,778 |
) |
|
|
(139,075 |
) |
Total stockholders’ equity |
|
|
751,485 |
|
|
|
732,174 |
|
Total liabilities and stockholders’ equity |
|
$ |
7,729,035 |
|
|
$ |
7,677,925 |
|
See Accompanying Notes to Consolidated Financial Statements (Unaudited)
Hanmi Financial Corporation and Subsidiaries
Consolidated Statements of Income (Unaudited)
(in thousands, except share and per share data)
|
|
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|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2025 |
|
|
2024 |
|
Interest and dividend income: |
|
|
|
|
|
|
Interest and fees on loans receivable |
|
$ |
90,887 |
|
|
$ |
91,674 |
|
Interest on securities |
|
|
6,169 |
|
|
|
4,955 |
|
Dividends on FHLB stock |
|
|
360 |
|
|
|
361 |
|
Interest on deposits in other banks |
|
|
1,841 |
|
|
|
2,604 |
|
Total interest and dividend income |
|
|
99,257 |
|
|
|
99,594 |
|
Interest expense: |
|
|
|
|
|
|
Interest on deposits |
|
|
40,559 |
|
|
|
45,638 |
|
Interest on borrowings |
|
|
2,024 |
|
|
|
1,655 |
|
Interest on subordinated debentures |
|
|
1,582 |
|
|
|
1,646 |
|
Total interest expense |
|
|
44,165 |
|
|
|
48,939 |
|
Net interest income before credit loss expense |
|
|
55,092 |
|
|
|
50,655 |
|
Credit loss expense |
|
|
2,721 |
|
|
|
227 |
|
Net interest income after credit loss expense |
|
|
52,371 |
|
|
|
50,428 |
|
Noninterest income: |
|
|
|
|
|
|
Service charges on deposit accounts |
|
|
2,217 |
|
|
|
2,450 |
|
Trade finance and other service charges and fees |
|
|
1,396 |
|
|
|
1,414 |
|
Gain on sale of Small Business Administration ("SBA") loans |
|
|
2,000 |
|
|
|
1,482 |
|
Gain on sale of mortgage loans |
|
|
175 |
|
|
|
— |
|
Other operating income |
|
|
1,938 |
|
|
|
2,387 |
|
Total noninterest income |
|
|
7,726 |
|
|
|
7,733 |
|
Noninterest expense: |
|
|
|
|
|
|
Salaries and employee benefits |
|
|
20,972 |
|
|
|
21,585 |
|
Occupancy and equipment |
|
|
4,450 |
|
|
|
4,537 |
|
Data processing |
|
|
3,787 |
|
|
|
3,551 |
|
Professional fees |
|
|
1,468 |
|
|
|
1,893 |
|
Supplies and communications |
|
|
517 |
|
|
|
601 |
|
Advertising and promotion |
|
|
585 |
|
|
|
907 |
|
Other operating expenses |
|
|
3,205 |
|
|
|
3,371 |
|
Total noninterest expense |
|
|
34,984 |
|
|
|
36,445 |
|
Income before tax |
|
|
25,113 |
|
|
|
21,716 |
|
Income tax expense |
|
|
7,441 |
|
|
|
6,552 |
|
Net income |
|
$ |
17,672 |
|
|
$ |
15,164 |
|
Basic earnings per share |
|
$ |
0.59 |
|
|
$ |
0.50 |
|
Diluted earnings per share |
|
$ |
0.58 |
|
|
$ |
0.50 |
|
Weighted-average shares outstanding: |
|
|
|
|
|
|
Basic |
|
|
29,937,660 |
|
|
|
30,119,646 |
|
Diluted |
|
|
30,058,248 |
|
|
|
30,119,646 |
|
See Accompanying Notes to Consolidated Financial Statements (Unaudited)
Hanmi Financial Corporation and Subsidiaries
Consolidated Statements of Comprehensive Income (Unaudited)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2025 |
|
|
2024 |
|
|
|
|
|
|
|
|
Net income |
|
$ |
17,672 |
|
|
$ |
15,164 |
|
Other comprehensive income (loss), net of tax: |
|
|
|
|
|
|
Unrealized gain (loss): |
|
|
|
|
|
|
Unrealized holding gain (loss) on available for sale securities |
|
|
14,542 |
|
|
|
(5,098 |
) |
Unrealized gain (loss) on cash flow hedges |
|
|
190 |
|
|
|
(2,207 |
) |
Unrealized gain (loss) |
|
|
14,732 |
|
|
|
(7,305 |
) |
Income tax benefit (expense) related to other comprehensive income items |
|
|
(4,183 |
) |
|
|
2,343 |
|
Other comprehensive income (loss) |
|
|
10,549 |
|
|
|
(4,962 |
) |
|
|
|
|
|
|
|
Reclassification adjustment for losses included in net income |
|
|
245 |
|
|
|
— |
|
Income tax benefit related to reclassification adjustment |
|
|
(73 |
) |
|
|
— |
|
Reclassification adjustment for losses included in net income, net of tax |
|
|
172 |
|
|
|
— |
|
Other comprehensive income (loss), net of tax |
|
|
10,721 |
|
|
|
(4,962 |
) |
Total comprehensive income |
|
$ |
28,393 |
|
|
$ |
10,202 |
|
See Accompanying Notes to Consolidated Financial Statements (Unaudited)
Hanmi Financial Corporation and Subsidiaries
Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)
For the Three Months Ended March 31, 2025 and 2024
(in thousands, except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
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|
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|
Common Stock - Number of Shares |
|
|
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Accumulated |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional |
|
|
Other |
|
|
|
|
|
Treasury |
|
|
Total |
|
|
|
Shares |
|
|
Treasury |
|
|
Shares |
|
|
Common |
|
|
Paid-in |
|
|
Comprehensive |
|
|
Retained |
|
|
Stock, |
|
|
Stockholders' |
|
|
|
Issued |
|
|
Shares |
|
|
Outstanding |
|
|
Stock |
|
|
Capital |
|
|
Loss |
|
|
Earnings |
|
|
at Cost |
|
|
Equity |
|
Balance at January 1, 2024 |
|
|
33,918,035 |
|
|
|
(3,549,380 |
) |
|
|
30,368,655 |
|
|
$ |
34 |
|
|
$ |
586,912 |
|
|
$ |
(71,928 |
) |
|
$ |
319,048 |
|
|
$ |
(132,175 |
) |
|
$ |
701,891 |
|
Issuance of awards pursuant to equity incentive plans, net of forfeitures |
|
|
39,249 |
|
|
|
— |
|
|
|
39,249 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Share-based compensation expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
775 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
775 |
|
Shares surrendered to satisfy tax liability upon vesting of equity awards |
|
|
— |
|
|
|
(31,546 |
) |
|
|
(31,546 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(490 |
) |
|
|
(490 |
) |
Repurchase of common stock |
|
|
— |
|
|
|
(100,000 |
) |
|
|
(100,000 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,592 |
) |
|
|
(1,592 |
) |
Cash dividends paid (common stock, $0.25/share) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(7,686 |
) |
|
|
— |
|
|
|
(7,686 |
) |
Net income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
15,164 |
|
|
|
— |
|
|
|
15,164 |
|
Change in unrealized gain (loss) on securities available for sale, net of income taxes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,394 |
) |
|
|
— |
|
|
|
— |
|
|
|
(3,394 |
) |
Change in unrealized gain (loss) on cash flow hedge, net of income taxes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,568 |
) |
|
|
— |
|
|
|
— |
|
|
|
(1,568 |
) |
Balance at March 31, 2024 |
|
|
33,957,284 |
|
|
|
(3,680,926 |
) |
|
|
30,276,358 |
|
|
$ |
34 |
|
|
$ |
587,687 |
|
|
$ |
(76,890 |
) |
|
$ |
326,526 |
|
|
$ |
(134,257 |
) |
|
$ |
703,100 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2025 |
|
|
34,151,464 |
|
|
|
(3,955,465 |
) |
|
|
30,195,999 |
|
|
$ |
34 |
|
|
$ |
591,069 |
|
|
$ |
(70,723 |
) |
|
$ |
350,869 |
|
|
$ |
(139,075 |
) |
|
$ |
732,174 |
|
Issuance of awards pursuant to equity incentive plans, net of forfeitures |
|
|
113,566 |
|
|
|
— |
|
|
|
113,566 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Share-based compensation expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
873 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
873 |
|
Shares surrendered to satisfy tax liability upon vesting of equity awards |
|
|
— |
|
|
|
(26,051 |
) |
|
|
(26,051 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(579 |
) |
|
|
(579 |
) |
Repurchase of common stock |
|
|
— |
|
|
|
(50,000 |
) |
|
|
(50,000 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,124 |
) |
|
|
(1,124 |
) |
Cash dividends paid (common stock, $0.27/share) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(8,252 |
) |
|
|
— |
|
|
|
(8,252 |
) |
Net income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
17,672 |
|
|
|
— |
|
|
|
17,672 |
|
Change in unrealized gain (loss) on securities available for sale, net of income taxes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
10,411 |
|
|
|
— |
|
|
|
— |
|
|
|
10,411 |
|
Change in unrealized gain (loss) on cash flow hedge, net of income taxes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
310 |
|
|
|
— |
|
|
|
— |
|
|
|
310 |
|
Balance at March 31, 2025 |
|
|
34,265,030 |
|
|
|
(4,031,516 |
) |
|
|
30,233,514 |
|
|
$ |
34 |
|
|
$ |
591,942 |
|
|
$ |
(60,002 |
) |
|
$ |
360,289 |
|
|
$ |
(140,778 |
) |
|
$ |
751,485 |
|
See Accompanying Notes to Consolidated Financial Statements (Unaudited)
Hanmi Financial Corporation and Subsidiaries
Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
|
2025 |
|
|
2024 |
|
Cash flows from operating activities: |
|
|
|
|
|
|
Net income |
|
$ |
17,672 |
|
|
$ |
15,164 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
1,592 |
|
|
|
1,604 |
|
Amortization of servicing assets - net |
|
|
692 |
|
|
|
694 |
|
Share-based compensation expense |
|
|
873 |
|
|
|
775 |
|
Credit loss expense |
|
|
2,721 |
|
|
|
227 |
|
(Gain) loss on sales of SBA loans |
|
|
(2,000 |
) |
|
|
(1,482 |
) |
Origination of SBA loans held for sale |
|
|
(35,420 |
) |
|
|
(17,632 |
) |
Proceeds from sales of loans |
|
|
43,837 |
|
|
|
26,555 |
|
(Gain) loss on sales of residential loans |
|
|
(175 |
) |
|
|
(443 |
) |
Change in bank-owned life insurance |
|
|
(308 |
) |
|
|
(304 |
) |
Change in prepaid expenses and other assets |
|
|
1,160 |
|
|
|
5,564 |
|
Change in income tax assets |
|
|
2,660 |
|
|
|
1,707 |
|
Change in accrued interest payable and other liabilities |
|
|
(7,460 |
) |
|
|
(2,446 |
) |
Net cash provided by operating activities |
|
|
25,844 |
|
|
|
29,983 |
|
Cash flows from investing activities: |
|
|
|
|
|
|
Purchases of securities available for sale |
|
|
(32,466 |
) |
|
|
(38,424 |
) |
Proceeds from matured, called and repayment of securities |
|
|
45,141 |
|
|
|
26,233 |
|
Purchases of loans receivable |
|
|
(34,301 |
) |
|
|
(10,198 |
) |
Proceeds from sales of mortgage loans |
|
|
— |
|
|
|
30,427 |
|
Purchases of premises and equipment |
|
|
(263 |
) |
|
|
(794 |
) |
Proceeds from disposition of premises and equipment |
|
|
14 |
|
|
|
— |
|
Change in loans receivable, excluding purchases and sales |
|
|
(8,608 |
) |
|
|
(16,729 |
) |
Net cash used in investing activities |
|
|
(30,483 |
) |
|
|
(9,485 |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
Change in deposits |
|
|
183,699 |
|
|
|
95,486 |
|
Change in open FHLB advances |
|
|
(145,000 |
) |
|
|
(152,500 |
) |
Cash paid for employee vested shares surrendered due to employee tax liability |
|
|
(579 |
) |
|
|
(490 |
) |
Repurchase of common stock |
|
|
(1,125 |
) |
|
|
(1,594 |
) |
Cash dividends paid |
|
|
(8,153 |
) |
|
|
(7,686 |
) |
Net cash provided by (used in) financing activities |
|
|
28,842 |
|
|
|
(66,784 |
) |
Net increase (decrease) in cash and due from banks |
|
|
24,203 |
|
|
|
(46,286 |
) |
Cash and due from banks at beginning of year |
|
|
304,800 |
|
|
|
302,324 |
|
Cash and due from banks at end of period |
|
$ |
329,003 |
|
|
$ |
256,038 |
|
Supplemental disclosures of cash flow information: |
|
|
|
|
|
|
Interest paid |
|
$ |
49,343 |
|
|
$ |
50,238 |
|
Income taxes paid |
|
$ |
550 |
|
|
$ |
175 |
|
Non-cash activities: |
|
|
|
|
|
|
Income tax benefit (expense) related to other comprehensive income items |
|
$ |
(4,256 |
) |
|
$ |
2,343 |
|
Change in right-of-use asset obtained in exchange for lease liability |
|
$ |
(4,442 |
) |
|
$ |
(1,873 |
) |
See Accompanying Notes to Consolidated Financial Statements (Unaudited)