EXHIBIT 99.1
LOS ANGELES, April 25, 2013 (GLOBE NEWSWIRE) -- Hanmi Financial Corporation (Nasdaq:HAFC), the holding company for Hanmi Bank (the "Bank"), today reported a net income of $10.1 million, or $0.32 per diluted share, for the first quarter of 2013, compared to $7.3 million, or $0.23 per diluted share, for the first quarter of 2012. In the fourth quarter of 2012, Hanmi earned $14.0 million, or $0.44 per diluted share, which included the effect of the reversal of a $5.5 million deferred tax asset ("DTA") valuation allowance. Income before tax nearly doubled to $14.8 million in the first quarter of 2013 from $7.4 million in the first quarter of 2012. The increase in Hanmi's earnings is based on solid loan production, increasing core deposits, and improving asset quality and operating efficiencies. Tangible book value increased 32.3% and 2.6% to $12.28 per share at March 31, 2013 from $9.28 per share at March 31, 2012 and $11.97 per share at December 31, 2012, respectively.
"We started 2013 with solid performance in the first quarter, mainly attributable to increased loan production and continuing improvement in asset quality, and are confident that Hanmi will deliver another year of improved operating performance in 2013," said Jay S. Yoo, President and Chief Executive Officer. "As one of our organic growth initiatives to penetrate new markets, we recently hired an experienced SBA lender with a proven track record to lead our expansion efforts in the Texas SBA market. We anticipate that our new Texas loan production office will open in the second quarter of 2013, and will start to contribute to revenues in the second half of the year."
"To reduce excess liquidity and improve profitability, the redemption of $30 million of trust preferred securities ("TPS") was completed on March 15, 2013," said Yoo. "We redeemed an additional $30 million of TPS on April 15, 2013 and expect to reduce the remaining $20 million by the end of April. The full redemption of these securities will improve our net interest margin by saving more than $2.5 million in annual interest expense."
First Quarter Results | |||
(In Thousands, Except Per Share Data) | |||
As of or for the Three Months Ended | |||
March 31, | December 31, | March 31, | |
2013 | 2012 | 2012 | |
Net Income | $ 10,110 | $ 13,979 | $ 7,341 |
Net Income Per Diluted Common Share | $ 0.32 | $ 0.44 | $ 0.23 |
Total Assets | $ 2,792,423 | $ 2,882,520 | $ 2,771,471 |
Net Loans | $ 2,061,156 | $ 1,986,051 | $ 1,896,827 |
Total Deposits | $ 2,333,012 | $ 2,395,963 | $ 2,363,726 |
Return on Average Assets | 1.45% | 1.94% | 1.08% |
Return on Average Stockholders' Equity | 10.71% | 15.02% | 10.21% |
Net Interest Margin | 3.86% | 3.86% | 3.69% |
Efficiency Ratio | 56.44% | 57.66% | 66.56% |
Tangible Common Equity to Tangible Assets Ratio | 13.89% | 13.09% | 10.55% |
Tangible Common Equity Per Common Share | $ 12.28 | $ 11.97 | $ 9.28 |
Classified Assets | $ 96,047 | $ 101,172 | $ 230,706 |
Classified Assets to Bank Tier 1 Capital and ALLL | 21.15% | 21.57% | 54.00% |
Financial Highlights (at or for the period ended March 31, 2013)
Results of Operations
Net interest income before the provision for credit losses totaled $25.6 million for the first quarter of 2013, down 3.1% from $26.4 million for the fourth quarter of 2012, and up 4.4% from $24.5 million for the first quarter of 2012. Interest and dividend income decreased 2.5% from the fourth quarter of 2012 and 3.0% from the first quarter of 2012, while interest expense increased 2.2% from the fourth quarter of 2012 and decreased 34.2% from the first quarter of 2012.
NIM was 3.86% for the first quarter of 2013, even with the fourth quarter of 2012, and up 17 basis points from the first quarter of 2012. "Continued loan production along with reduced excess liquidity is contributing to a stable NIM," said Mark Yoon, Senior Vice President and Chief Financial Officer. The following table details the asset yields, liability costs, spread and margin.
Three Months Ended | |||
March 31, | December 31, | March 31, | |
2013 | 2012 | 2012 | |
Total Interest-Earning Assets | 4.43% | 4.40% | 4.56% |
Total Interest-Bearing Liability | 0.89% | 0.83% | 1.30% |
Net Interest Spread | 3.54% | 3.57% | 3.26% |
Net Interest Margin | 3.86% | 3.86% | 3.69% |
Asset quality ratios continued to show improvement in the first quarter with the continuing downward trend in non-performing assets to total assets of 1.21% as of March 31, 2013 compared to 1.32% as of December 31, 2012. Allowance for loan losses ("ALLL") to non-performing loans ("NPLs") rose to 186.03% as of March 31, 2013 compared to 169.81% as of December 31, 2012. There was no provision for credit losses for the three months ended March 31, 2013 and December 31, 2012 compared to a $2.0 million provision for the three months ended March 31, 2012.
Non-interest income in the first quarter of 2013 increased to $8.4 million, up from $7.5 million in the fourth quarter of 2012 and $3.6 million in the first quarter of 2012, due mainly to higher gain on sales of SBA loans and lower net losses recognized from selling NPLs.
Non-interest expense in the first quarter of 2013 was $19.2 million, down from $19.5 million in the fourth quarter of 2012, reflecting lower deposit insurance premiums and regulatory assessments, partially offset by higher professional fees. For the first quarter of 2013, deposit insurance premiums and regulatory assessments were down more than $1.0 million from the fourth quarter of 2012 and $1.2 million from the first quarter of 2012, due mainly to a lower premium assessment resulting from our improved overall financial conditions. Professional fees increased in the first quarter of 2013, due mainly to costs associated with the strategic option considered in the beginning of the year as well as legal fees incurred in defending lawsuits in the ordinary course of business.
Balance Sheet
Assets totaled $2.79 billion at March 31, 2013, down 3.1% from $2.88 billion at December 31, 2012, and up 0.8% from $2.77 billion at March 31, 2012. "We remain focused on right-sizing our balance sheet through redeployment of excess liquidity, which will temporarily reduce the size of total assets, but will result in better profitability," said Yoon.
In the first quarter of 2013, Hanmi produced 164 new loans totaling $178.6 million, of which $36.1 million were Small Business Administration ("SBA") loans, $138.0 million were commercial real estate loans, $4.3 million were commercial term loans and lines of credit, and $201,000 were consumer loans. Overall loan production was down 14.4% from the fourth quarter of 2012 and up 11.7% from the first quarter of 2012. The decreased loan production was primarily attributable to a seasonal falloff. "Our goal is to grow loan portfolio 8% this year, while diversifying it. Despite intense competition, we expect that loan production will ramp up in the coming quarters," said Yoon.
Loans receivable, excluding loans held for sale, increased to $2.06 billion at March 31, 2013, up 3.8% from $1.99 billion at December 31, 2012, and 8.7% from $1.90 billion at March 31, 2012. Loans held for sale totaled $6.0 million at March 31, 2013, down from $8.3 million at December 31, 2012, and from $56.0 million at March 31, 2012. Average gross loans, net of deferred loan fees, increased to $2.07 billion for the first quarter of 2013, up from $2.03 billion for the fourth quarter of 2012, and $1.99 billion for the first quarter of 2012.
Average deposits for the first quarter of 2013 were $2.35 billion, down from $2.39 billion for the fourth quarter of 2012, and up from $2.34 billion for the first quarter of 2012. The overall mix of funding continued to improve with time deposits declining and low- and no-cost transaction account balances increasing. "Our deposits were down for the quarter due mainly to a decrease of $59.0 million in Jumbo CDs, which includes $28.5 million of CDs raised from Internet listing services, but our core deposits continued to grow as a percent of deposits," Yoon noted. The deposit mix for the past year is detailed in the table below.
March 31, | December 31, | March 31, | |
2013 | 2012 | 2012 | |
Demand - Noninterest-Bearing | 30.5% | 30.1% | 29.8% |
Savings | 4.9% | 4.8% | 4.6% |
Money Market Checking and NOW Accounts | 24.8% | 24.0% | 21.9% |
Time Deposits of $100,000 or More | 23.9% | 25.7% | 29.1% |
Other Time Deposits | 15.9% | 15.4% | 14.6% |
Total Deposits | 100.0% | 100.0% | 100.0% |
At March 31, 2013, total stockholders' equity was $389.1 million. Tangible common stockholders' equity was $387.8 million at March 31, 2013, or 13.89% of tangible assets, compared to $377.0 million, or 13.09% of tangible assets, at December 31, 2012, and $292.3 million, or 10.55% of tangible assets, at March 31, 2012. Tangible book value per share was $12.28 at March 31, 2013, up 2.6% from $11.97 at December 31, 2012, and 32.3% from $9.28 at March 31, 2012.
Asset Quality
NPLs, excluding loans held for sale, decreased to $32.9 million at March 31, 2013, down 11.8% from $37.3 million at December 31, 2012, and down 34.5% from $50.2 million at March 31, 2012. Troubled debt restructurings ("TDRs"), totaled $31.7 million at March 31, 2013, down from $35.7 million at December 31, 2012, and $41.5 million at March 31, 2012. Of these TDRs, $17.0 million are NPLs. Two loans of NPLs in the aggregate amount of $2.3 million were recorded at the lower of cost or fair value and classified as loans held for sale at March 31, 2013. The following table shows NPLs in each category:
March 31, 2013 | December 31, 2012 | March 31, 2012 | ||||
% to Total | % to Total | % to Total | ||||
Amount | NPL | Amount | NPL | Amount | NPL | |
(In Thousands) | ||||||
Real Estate Loans: | ||||||
Commercial Property | ||||||
Retail | $ 950 | 2.9% | $ 1,079 | 2.9% | $ 1,327 | 2.6% |
Land | 1,687 | 5.1% | 2,097 | 5.6% | 2,187 | 4.4% |
Other | -- | 0.0% | -- | 0.0% | 1,454 | 2.9% |
Construction | -- | 0.0% | -- | 0.0% | 8,157 | 16.2% |
Residential Property | 1,638 | 5.0% | 1,270 | 3.4% | 1,524 | 3.0% |
Commercial & Industrial Loans: | ||||||
Commercial Term Loans | ||||||
Unsecured | 7,253 | 22.1% | 8,311 | 22.3% | 6,942 | 13.8% |
Secured by Real Estate | 6,353 | 19.3% | 8,679 | 23.3% | 9,837 | 19.6% |
Commercial Lines of Credit | 1,505 | 4.6% | 1,521 | 4.1% | 1,610 | 3.2% |
SBA | 11,852 | 36.0% | 12,563 | 33.7% | 16,648 | 33.2% |
Consumer Loans | 1,655 | 5.0% | 1,759 | 4.7% | 528 | 1.1% |
Total Non-Performing Loans | $ 32,893 | 100.0% | $ 37,279 | 100.0% | $ 50,214 | 100.0% |
"As anticipated, continuing improvement in asset quality has resulted in a reduction of problem loan sales in the first quarter of 2013. The first quarter NPL sales totaled $1.6 million," said J.H. Son, Executive Vice President and Chief Credit Officer. "More importantly, the losses associated with our loan sales strategy are significantly lower than they have been in previous years, which indicate that our strategy to sell loans, before they are moved into foreclosure, has been effective." Classified loans were $95.1 million, or 4.5% of gross loans, at March 31, 2013, down from $100.4 million, or 4.9% of gross loans, at December 31, 2012, and $229.5 million, or 11.6% of gross loans, at March 31, 2012.
Delinquent loans that are less than 90 days past due and still accruing interest increased to $6.4 million at March 31, 2013, or 0.30% of gross loans, up from $2.4 million, or 0.12% of gross loans, at December 31, 2012. "The incidental uptick in delinquent loans is a temporary setback due to administrative delays and is expected to decrease again in the second quarter of 2013 with diligent monitoring and collection efforts," said Son. At March 31, 2013, ALLL was $61.2 million, or 2.88% of gross loans and 186.0% of NPLs, compared to 4.10% of gross loans and 161.4% of NPLs at March 31, 2012. For the first quarter of 2013, net charge-offs were $2.3 million, down from $3.2 million for the fourth quarter of 2012, and $11.3 million for the first quarter of 2012.
Conference Call Information
Management will host a conference call today, April 25, 2013, at 1:30 p.m. Pacific Time (4:30 p.m. ET) to discuss these results. This call will also be broadcast live via the internet. Investment professionals and all current and prospective stockholders are invited to access the live call by dialing 1-480-629-9643 at 1:30 p.m. Pacific Time, using access code HANMI. To listen to the call online, either live or archived, visit the Investor Relations page of Hanmi's website at www.hanmi.com.
About Hanmi Financial Corporation
Headquartered in Los Angeles, Hanmi Bank, a wholly-owned subsidiary of Hanmi Financial Corporation, provides services to the multi-ethnic communities of California, with 27 full-service offices in Los Angeles, Orange, San Bernardino, San Francisco, Santa Clara and San Diego counties, and a loan production office in Washington State. Hanmi Bank specializes in commercial, SBA and trade finance lending, and is a recognized community leader. Hanmi Bank's mission is to provide a full range of quality products and premier services to its customers and to maximize stockholder value.
Forward-Looking Statements
This press release contains forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "plans," "intends," "anticipates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of such terms and other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. All statements other than statements of historical fact are "forward–looking statements" for purposes of federal and state securities laws, including, but not limited to, statements about anticipated future operating and financial performance, financial position and liquidity, business strategies, regulatory and competitive outlook, investment and expenditure plans, capital and financing needs and availability, plans and objectives of management for future operations, developments regarding our capital plans, strategic alternatives for a possible business combination, merger or sale transaction and other similar forecasts and statements of expectation and statements of assumption underlying any of the foregoing. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ from those expressed or implied by the forward-looking statement. These factors include the following: failure to maintain adequate levels of capital and liquidity to support our operations; the effect of regulatory orders we have entered into and potential future supervisory action against us or Hanmi Bank; general economic and business conditions internationally, nationally and in those areas in which we operate; volatility and deterioration in the credit and equity markets; changes in consumer spending, borrowing and savings habits; availability of capital from private and government sources; demographic changes; competition for loans and deposits and failure to attract or retain loans and deposits; fluctuations in interest rates and a decline in the level of our interest rate spread; risks of natural disasters related to our real estate portfolio; risks associated with Small Business Administration loans; failure to attract or retain key employees; changes in governmental regulation, including, but not limited to, any increase in FDIC insurance premiums; ability to receive regulatory approval for Hanmi Bank to declare dividends to Hanmi Financial; ability to identify a suitable strategic partner or to consummate a strategic transaction; adequacy of our allowance for loan losses; credit quality and the effect of credit quality on our provision for credit losses and allowance for loan losses; changes in the financial performance and/or condition of our borrowers and the ability of our borrowers to perform under the terms of their loans and other terms of credit agreements; our ability to control expenses; and changes in securities markets. In addition, we set forth certain risks in our reports filed with the U.S. Securities and Exchange Commission ("SEC"), including, in Item 1A of our Form 10-K for the year ended December 31, 2012, our quarterly reports on Form 10-Q, and current and periodic reports that we will file with the SEC hereafter, which could cause actual results to differ from those projected. We undertake no obligation to update such forward-looking statements except as required by law.
HANMI FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||
CONSOLIDATED BALANCE SHEETS (UNAUDITED) | |||||||
(In Thousands) | |||||||
March 31, | December 31, | Percentage | March 31, | Percentage | |||
2013 | 2012 | Change | 2012 | Change | |||
ASSETS | |||||||
Cash and Due From Banks | $ 69,642 | $ 92,350 | -24.6% | $ 68,093 | 2.3% | ||
Interest-Bearing Deposits in Other Banks | 75,657 | 175,697 | -56.9% | 92,149 | -17.9% | ||
Cash and Cash Equivalents | 145,299 | 268,047 | -45.8% | 160,242 | -9.3% | ||
Restricted Cash | -- | 5,350 | -100.0% | 1,818 | -100.0% | ||
Term Federal Funds Sold | -- | -- | 0.0% | 120,000 | -100.0% | ||
Securities Available for Sale, at Fair Value | 419,903 | 451,060 | -6.9% | 355,837 | 18.0% | ||
Securities Held to Maturity, at Amortized Cost | -- | -- | 0.0% | 59,472 | -100.0% | ||
Loans Held for Sale, at the Lower of Cost or Fair Value | 6,043 | 8,306 | -27.2% | 55,993 | -89.2% | ||
Loans Receivable, Net of Allowance for Loan Losses | 2,061,156 | 1,986,051 | 3.8% | 1,896,827 | 8.7% | ||
Accrued Interest Receivable | 7,526 | 7,581 | -0.7% | 7,969 | -5.6% | ||
Premises and Equipment, Net | 14,792 | 15,150 | -2.4% | 16,272 | -9.1% | ||
Other Real Estate Owned, Net | 900 | 774 | 16.3% | 1,260 | -28.6% | ||
Customers' Liability on Acceptances | 2,170 | 1,336 | 62.4% | 1,539 | 41.0% | ||
Servicing Assets | 6,004 | 5,542 | 8.3% | 3,515 | 70.8% | ||
Other Intangible Assets, Net | 1,294 | 1,335 | -3.1% | 1,462 | -11.5% | ||
Investment in Federal Home Loan Bank Stock, at Cost | 16,014 | 17,800 | -10.0% | 21,761 | -26.4% | ||
Investment in Federal Reserve Bank Stock, at Cost | 12,222 | 12,222 | 0.0% | 8,558 | 42.8% | ||
Income Tax Asset | 57,084 | 60,028 | -4.9% | 11,501 | 396.3% | ||
Bank-Owned Life Insurance | 29,284 | 29,054 | 0.8% | 28,344 | 3.3% | ||
Prepaid Expenses | 2,676 | 2,084 | 28.4% | 3,204 | -16.5% | ||
Other Assets | 10,056 | 10,800 | -6.9% | 15,897 | -36.7% | ||
TOTAL ASSETS | $ 2,792,423 | $ 2,882,520 | -3.1% | $ 2,771,471 | 0.8% | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
LIABILITIES: | |||||||
Deposits: | |||||||
Noninterest-Bearing | $ 709,650 | $ 720,931 | -1.6% | $ 704,061 | 0.8% | ||
Interest-Bearing | 1,623,362 | 1,675,032 | -3.1% | 1,659,665 | -2.2% | ||
Total Deposits | 2,333,012 | 2,395,963 | -2.6% | 2,363,726 | -1.3% | ||
Accrued Interest Payable | 3,192 | 11,775 | -72.9% | 15,602 | -79.5% | ||
Bank's Liability on Acceptances | 2,170 | 1,336 | 62.4% | 1,539 | 41.0% | ||
Federal Home Loan Bank Advances | 2,840 | 2,935 | -3.2% | 3,213 | -11.6% | ||
Junior Subordinated Debentures | 51,478 | 82,406 | -37.5% | 82,406 | -37.5% | ||
Accrued Expenses and Other Liabilities | 10,626 | 9,741 | 9.1% | 11,267 | -5.7% | ||
TOTAL LIABILITIES | 2,403,318 | 2,504,156 | -4.0% | 2,477,753 | -3.0% | ||
STOCKHOLDERS' EQUITY: | |||||||
Common Stock | 257 | 257 | 0.0% | 257 | 0.0% | ||
Additional Paid-In Capital | 551,064 | 550,123 | 0.2% | 549,811 | 0.2% | ||
Unearned Compensation | (44) | (57) | -22.8% | (141) | -68.8% | ||
Accumulated Other Comprehensive Income | 5,095 | 5,418 | -6.0% | 4,201 | 21.3% | ||
Accumulated Deficit | (97,409) | (107,519) | -9.4% | (190,552) | -48.9% | ||
Less Treasury Stock | (69,858) | (69,858) | 0.0% | (69,858) | 0.0% | ||
TOTAL STOCKHOLDERS' EQUITY | 389,105 | 378,364 | 2.8% | 293,718 | 32.5% | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 2,792,423 | $ 2,882,520 | -3.1% | $ 2,771,471 | 0.8% | ||
HANMI FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | |||||||
(In Thousands, Except Per Share Data) | |||||||
Three Months Ended | |||||||
March 31, | December 31, | Percentage | March 31, | Percentage | |||
2013 | 2012 | Change | 2012 | Change | |||
INTEREST AND DIVIDEND INCOME: | |||||||
Interest and Fees on Loans | $ 26,799 | $ 27,418 | -2.3% | $ 27,542 | -2.7% | ||
Taxable Interest on Investment Securities | 2,116 | 2,138 | -1.0% | 2,098 | 0.9% | ||
Tax-Exempt Interest on Investment Securities | 95 | 95 | 0.0% | 102 | -6.9% | ||
Interest on Term Federal Funds Sold | -- | 22 | -100.0% | 325 | -100.0% | ||
Interest on Federal Funds Sold | 6 | 7 | -14.3% | 2 | 200.0% | ||
Interest on Interest-Bearing Deposits in Other Banks | 88 | 153 | -42.5% | 68 | 29.4% | ||
Dividends on Federal Reserve Bank Stock | 183 | 179 | 2.2% | 128 | 43.0% | ||
Dividends on Federal Home Loan Bank Stock | 108 | 127 | -15.0% | 29 | 272.4% | ||
Total Interest and Dividend Income | 29,395 | 30,139 | -2.5% | 30,294 | -3.0% | ||
INTEREST EXPENSE: | |||||||
Interest on Deposits | 3,159 | 3,366 | -6.1% | 4,919 | -35.8% | ||
Interest on Federal Home Loan Bank Advances | 38 | 39 | -2.6% | 43 | -11.6% | ||
Interest on Junior Subordinated Debentures | 594 | 303 | 96.0% | 799 | -25.7% | ||
Total Interest Expense | 3,791 | 3,708 | 2.2% | 5,761 | -34.2% | ||
NET INTEREST INCOME BEFORE PROVISION FOR CREDIT LOSSES | 25,604 | 26,431 | -3.1% | 24,533 | 4.4% | ||
Provision for Credit Losses | -- | -- | 0.0% | 2,000 | -100.0% | ||
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 25,604 | 26,431 | -3.1% | 22,533 | 13.6% | ||
NON-INTEREST INCOME: | |||||||
Service Charges on Deposit Accounts | 3,048 | 3,191 | -4.5% | 3,168 | -3.8% | ||
Insurance Commissions | 1,213 | 1,235 | -1.8% | 1,236 | -1.9% | ||
Trade Finance & Other Other Service Charges and Fees | 1,172 | 1,235 | -5.1% | 1,110 | 5.6% | ||
Bank-Owned Life Insurance Income | 230 | 238 | -3.4% | 399 | -42.4% | ||
Gain on Sales of SBA Loans Guaranteed Portion | 2,692 | 2,678 | 0.5% | -- | 0.0% | ||
Net Loss on Sales of Other Loans | (97) | (1,247) | -92.2% | (2,393) | -95.9% | ||
Net Gain on Sales of Investment Securities | 9 | 4 | 125.0% | 1 | 800.0% | ||
Other Operating Income | 90 | 136 | -33.8% | 112 | -19.6% | ||
Total Non-Interest Income | 8,357 | 7,470 | 11.9% | 3,633 | 130.0% | ||
NON-INTEREST EXPENSE: | |||||||
Salaries and Employee Benefits | 9,351 | 9,224 | 1.4% | 9,110 | 2.6% | ||
Occupancy and Equipment | 2,556 | 2,585 | -1.1% | 2,595 | -1.5% | ||
Deposit Insurance Premiums and Regulatory Assessments | 234 | 1,249 | -81.3% | 1,401 | -83.3% | ||
Data Processing | 1,170 | 1,179 | -0.8% | 1,253 | -6.6% | ||
Other Real Estate Owned Expense | 32 | (33) | -197.0% | (44) | 172.7% | ||
Professional Fees | 2,156 | 1,744 | 23.6% | 749 | 187.9% | ||
Directors and Officers Liability Insurance | 220 | 298 | -26.2% | 297 | -25.9% | ||
Supplies and Communications | 495 | 567 | -12.7% | 558 | -11.3% | ||
Advertising and Promotion | 672 | 1,243 | -45.9% | 601 | 11.8% | ||
Loan-Related Expense | 146 | 75 | 94.7% | 200 | -27.0% | ||
Amortization of Other Intangible Assets | 41 | 41 | 0.0% | 71 | -42.3% | ||
Other Operating Expenses | 2,094 | 1,376 | 52.2% | 1,955 | 7.1% | ||
Total Non-Interest Expense | 19,167 | 19,548 | -1.9% | 18,746 | 2.2% | ||
INCOME BEFORE PROVISION FOR INCOME TAXES | 14,794 | 14,353 | 3.1% | 7,420 | 99.4% | ||
Provision for Income Taxes | 4,684 | 374 | 1152.4% | 79 | 5829.1% | ||
NET INCOME | $ 10,110 | $ 13,979 | -27.7% | $ 7,341 | 37.7% | ||
EARNINGS PER SHARE: | |||||||
Basic | $ 0.32 | $ 0.44 | $ 0.23 | ||||
Diluted | $ 0.32 | $ 0.44 | $ 0.23 | ||||
WEIGHTED-AVERAGE SHARES OUTSTANDING: | |||||||
Basic | 31,538,980 | 31,479,921 | 31,470,520 | ||||
Diluted | 31,626,667 | 31,549,580 | 31,489,569 | ||||
COMMON SHARES OUTSTANDING | 31,588,767 | 31,496,540 | 31,489,201 | ||||
HANMI FINANCIAL CORPORATION AND SUBSIDIARIES | ||||
SELECTED FINANCIAL DATA (UNAUDITED) | ||||
(In Thousands) | ||||
As of or for the Three Months Ended | ||||
March 31, | December 31, | March 31, | ||
2013 | 2012 | 2012 | ||
AVERAGE BALANCES: | ||||
Average Gross Loans, Net of Deferred Loan Fees (1) | $ 2,073,514 | $ 2,026,122 | $ 1,985,071 | |
Average Investment Securities | 443,073 | 421,520 | 426,384 | |
Average Interest-Earning Assets | 2,693,424 | 2,731,473 | 2,676,643 | |
Average Total Assets | 2,829,927 | 2,872,897 | 2,742,006 | |
Average Deposits | 2,348,799 | 2,388,725 | 2,337,302 | |
Average Borrowings | 79,110 | 85,390 | 85,665 | |
Average Interest-Bearing Liabilities | 1,727,272 | 1,767,640 | 1,777,208 | |
Average Stockholders' Equity | 383,003 | 370,307 | 289,132 | |
Average Tangible Equity | 381,682 | 368,945 | 287,631 | |
PERFORMANCE RATIOS: | ||||
Return on Average Assets (2) | 1.45% | 1.94% | 1.08% | |
Return on Average Stockholders' Equity (2) | 10.71% | 15.02% | 10.21% | |
Return on Average Tangible Equity (2) | 10.74% | 15.07% | 10.38% | |
Efficiency Ratio | 56.44% | 57.66% | 66.56% | |
Net Interest Spread (2),(3) | 3.54% | 3.57% | 3.26% | |
Net Interest Margin (2),(3) | 3.86% | 3.86% | 3.69% | |
ALLOWANCE FOR LOAN LOSSES: | ||||
Balance at Beginning of Period | $ 63,305 | $ 66,107 | $ 89,936 | |
Provision Charged to Operating Expense | 196 | 407 | 2,400 | |
Charge-Offs, Net of Recoveries | (2,310) | (3,209) | (11,284) | |
Balance at End of Period | $ 61,191 | $ 63,305 | $ 81,052 | |
ASSET QUALITY RATIOS: | ||||
Net Loan Charge-Offs to Average Gross Loans (2) | 0.45% | 0.63% | 2.27% | |
Allowance for Loan Losses to Gross Loans | 2.88% | 3.09% | 4.10% | |
Allowance for Loan Losses to Non-Performing Loans | 186.03% | 169.81% | 161.41% | |
Non-Performing Assets to Total Assets | 1.21% | 1.32% | 1.86% | |
Non-Performing Loans to Gross Loans | 1.55% | 1.82% | 2.54% | |
Non-Performing Assets to Allowance for Loan Losses | 55.23% | 60.11% | 63.51% | |
ALLOWANCE FOR OFF-BALANCE SHEET ITEMS: | ||||
Balance at Beginning of Period | $ 1,824 | $ 2,231 | $ 2,981 | |
Provision Charged to Operating Expense | (196) | (407) | (400) | |
Balance at End of Period | $ 1,628 | $ 1,824 | $ 2,581 | |
NON-PERFORMING ASSETS: | ||||
Non-Accrual Loans | $ 32,893 | $ 37,279 | $ 50,214 | |
Loans 90 Days or More Past Due and Still Accruing | -- | -- | -- | |
Non-Performing Loans | 32,893 | 37,279 | 50,214 | |
Other Real Estate Owned, Net | 900 | 774 | 1,260 | |
Non-Performing Assets | 33,793 | 38,053 | 51,474 | |
Non-Performing Loans in Loans Held for Sale | 2,306 | 484 | 15,472 | |
Non-Performing Assets (including Loans Held for Sale) | $ 36,099 | $ 38,537 | $ 66,946 | |
DELINQUENT LOANS (30 to 89 Days Past Due and Still Accruing) | $ 6,440 | $ 2,371 | $ 10,497 | |
Delinquent Loans to Gross Loans | 0.30% | 0.12% | 0.53% | |
(1) Loans Held for Sale are included in average gross loans. | ||||
(2) Annualized | ||||
(3) Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate. | ||||
HANMI FINANCIAL CORPORATION AND SUBSIDIARIES | |||
SELECTED FINANCIAL DATA, CONTINUED (UNAUDITED) | |||
(In Thousands) | |||
Three Months Ended | |||
March 31, | December 31, | March 31, | |
2013 | 2012 | 2012 | |
LOAN PORTFOLIO: | |||
Real Estate Loans | $ 831,019 | $ 787,094 | $ 717,491 |
Residential Loans | 94,735 | 101,778 | 116,566 |
Commercial and Industrial Loans | 1,160,752 | 1,123,012 | 1,102,769 |
Consumer Loans | 35,180 | 36,676 | 40,152 |
Gross Loans | 2,121,686 | 2,048,560 | 1,976,978 |
Deferred Loan Fees | 661 | 796 | 901 |
Gross Loans, Net of Deferred Loan Fees | 2,122,347 | 2,049,356 | 1,977,879 |
Allowance for Loan Losses | (61,191) | (63,305) | (81,052) |
Loans Receivable, Net | 2,061,156 | 1,986,051 | 1,896,827 |
Loans Held for Sale, at the Lower of Cost or Fair Value | 6,043 | 8,306 | 55,993 |
Total Loans Receivable, Net | $ 2,067,199 | $ 1,994,357 | $ 1,952,820 |
LOAN MIX: | |||
Real Estate Loans | 39.1% | 38.4% | 36.3% |
Residential Loans | 4.5% | 5.0% | 5.9% |
Commercial and Industrial Loans | 54.7% | 54.8% | 55.8% |
Consumer Loans | 1.7% | 1.8% | 2.0% |
Total Loans | 100.0% | 100.0% | 100.0% |
DEPOSIT PORTFOLIO: | |||
Demand - Noninterest-Bearing | $ 709,650 | $ 720,931 | $ 704,061 |
Savings | 115,186 | 114,302 | 108,698 |
Money Market Checking and NOW Accounts | 579,192 | 575,744 | 516,628 |
Time Deposits of $100,000 or More | 557,180 | 616,187 | 687,573 |
Other Time Deposits | 371,804 | 368,799 | 346,766 |
Total Deposits | $ 2,333,012 | $ 2,395,963 | $ 2,363,726 |
DEPOSIT MIX: | |||
Demand - Noninterest-Bearing | 30.5% | 30.1% | 29.8% |
Savings | 4.9% | 4.8% | 4.6% |
Money Market Checking and NOW Accounts | 24.8% | 24.0% | 21.9% |
Time Deposits of $100,000 or More | 23.9% | 25.7% | 29.1% |
Other Time Deposits | 15.9% | 15.4% | 14.6% |
Total Deposits | 100.0% | 100.0% | 100.0% |
CAPITAL RATIOS: | |||
Hanmi Financial | |||
Total Risk-Based Capital Ratio | 19.45% | 20.65% | 18.74% |
Tier 1 Risk-Based Capital Ratio | 18.17% | 19.37% | 17.46% |
Tier 1 Leverage Capital Ratio | 14.68% | 14.95% | 13.44% |
Tangible Equity to Tangible Assets Ratio | 13.89% | 13.09% | 10.55% |
Hanmi Bank | |||
Total Risk-Based Capital Ratio | 18.69% | 19.85% | 17.74% |
Tier 1 Risk-Based Capital Ratio | 17.42% | 18.58% | 16.45% |
Tier 1 Leverage Capital Ratio | 14.07% | 14.33% | 12.67% |
Tangible Equity to Tangible Assets Ratio | 15.10% | 15.29% | 12.71% |
HANMI FINANCIAL CORPORATION AND SUBSIDIARIES | |||||||||||||||
AVERAGE BALANCE, AVERAGE YIELD EARNED AND AVERAGE RATE PAID (UNAUDITED) | |||||||||||||||
(In Thousands) | |||||||||||||||
Three Months Ended | |||||||||||||||
March 31, 2013 | December 31, 2012 | March 31, 2012 | |||||||||||||
Interest | Average | Interest | Average | Interest | Average | ||||||||||
Average | Income / | Yield / | Average | Income / | Yield / | Average | Income / | Yield / | |||||||
Balance | Expense | Rate | Balance | Expense | Rate | Balance | Expense | Rate | |||||||
ASSETS | |||||||||||||||
Interest-Earning Assets: | |||||||||||||||
Gross Loans, Net of Deferred Loan Fees | $ 2,073,514 | $ 26,799 | 5.24% | $ 2,026,122 | $ 27,418 | 5.38% | $ 1,985,071 | $ 27,542 | 5.58% | ||||||
Municipal Securities - Taxable | 46,111 | 454 | 3.94% | 46,203 | 456 | 3.95% | 44,888 | 446 | 3.97% | ||||||
Municipal Securities - Tax Exempt | 12,803 | 146 | 4.57% | 12,731 | 146 | 4.59% | 13,283 | 157 | 4.73% | ||||||
Obligations of Other U.S. Government Agencies | 88,982 | 422 | 1.90% | 82,995 | 387 | 1.87% | 73,446 | 325 | 1.77% | ||||||
Other Debt Securities | 295,177 | 1,240 | 1.68% | 279,591 | 1,295 | 1.85% | 294,767 | 1,327 | 1.80% | ||||||
Equity Securities | 30,336 | 291 | 3.84% | 30,971 | 306 | 3.95% | 31,255 | 157 | 2.01% | ||||||
Federal Funds Sold | 5,963 | 6 | 0.41% | 7,127 | 7 | 0.39% | 1,852 | 2 | 0.43% | ||||||
Term Federal Funds Sold | -- | -- | 0.00% | 6,685 | 22 | 1.31% | 126,484 | 325 | 1.03% | ||||||
Interest-Bearing Deposits in Other Banks | 140,538 | 88 | 0.25% | 239,048 | 153 | 0.25% | 105,597 | 68 | 0.26% | ||||||
Total Interest-Earning Assets | 2,693,424 | 29,446 | 4.43% | 2,731,473 | 30,190 | 4.40% | 2,676,643 | 30,349 | 4.56% | ||||||
Noninterest-Earning Assets: | |||||||||||||||
Cash and Cash Equivalents | 66,166 | 73,567 | 69,152 | ||||||||||||
Allowance for Loan Losses | (62,639) | (65,228) | (88,024) | ||||||||||||
Other Assets | 132,976 | 133,085 | 84,235 | ||||||||||||
Total Noninterest-Earning Assets | 136,503 | 141,424 | 65,363 | ||||||||||||
TOTAL ASSETS | $ 2,829,927 | $ 2,872,897 | $ 2,742,006 | ||||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||||
Interest-Bearing Liabilities: | |||||||||||||||
Deposits: | |||||||||||||||
Savings | $ 114,182 | $ 458 | 1.63% | $ 112,566 | $ 477 | 1.69% | $ 105,676 | $ 583 | 2.22% | ||||||
Money Market Checking and NOW Accounts | 567,977 | 720 | 0.51% | 583,259 | 772 | 0.53% | 465,664 | 676 | 0.58% | ||||||
Time Deposits of $100,000 or More | 595,205 | 1,175 | 0.80% | 623,780 | 1,312 | 0.84% | 782,562 | 2,748 | 1.41% | ||||||
Other Time Deposits | 370,798 | 806 | 0.88% | 362,645 | 805 | 0.88% | 337,641 | 912 | 1.09% | ||||||
FHLB Advances | 2,890 | 38 | 5.33% | 2,984 | 39 | 5.20% | 3,259 | 43 | 5.31% | ||||||
Junior Subordinated Debentures | 76,220 | 594 | 3.16% | 82,406 | 303 | 1.46% | 82,406 | 799 | 3.90% | ||||||
Total Interest-Bearing Liabilities | 1,727,272 | 3,791 | 0.89% | 1,767,640 | 3,708 | 0.83% | 1,777,208 | 5,761 | 1.30% | ||||||
Noninterest-Bearing Liabilities: | |||||||||||||||
Demand Deposits | 700,637 | 706,475 | 645,759 | ||||||||||||
Other Liabilities | 19,015 | 28,475 | 29,907 | ||||||||||||
Total Noninterest-Bearing Liabilities | 719,652 | 734,950 | 675,666 | ||||||||||||
Total Liabilities | 2,446,924 | 2,502,590 | 2,452,874 | ||||||||||||
Stockholders' Equity | 383,003 | 370,307 | 289,132 | ||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 2,829,927 | $ 2,872,897 | $ 2,742,006 | ||||||||||||
NET INTEREST INCOME | $ 25,655 | $ 26,482 | $ 24,588 | ||||||||||||
COST OF DEPOSITS | 0.55% | 0.56% | 0.85% | ||||||||||||
NET INTEREST SPREAD | 3.54% | 3.57% | 3.26% | ||||||||||||
NET INTEREST MARGIN | 3.86% | 3.86% | 3.69% | ||||||||||||
Non-GAAP Financial Measures
Tangible Common Equity to Tangible Assets Ratio
Tangible common equity to tangible assets ratio is supplemental financial information determined by a method other than in accordance with U.S. generally accepted accounting principles ("GAAP"). This non-GAAP measure is used by management in the analysis of Hanmi Financial and Hanmi Bank's capital strength. Tangible equity is calculated by subtracting goodwill and other intangible assets from total stockholders' equity. Banking and financial institution regulators also exclude goodwill and other intangible assets from total stockholders' equity when assessing the capital adequacy of a financial institution. Management believes the presentation of this financial measure excluding the impact of these items provides useful supplemental information that is essential to a proper understanding of the capital strength of Hanmi Financial and Hanmi Bank. This disclosure should not be viewed as a substitution for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies.
The following table reconciles this non-GAAP performance measure to the GAAP performance measure for the periods indicated:
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS RATIO (UNAUDITED) | |||
(In Thousands, Except Per Share Data) | |||
March 31, | December 31, | March 31, | |
HANMI FINANCIAL CORPORATION | 2013 | 2012 | 2012 |
Total Assets | $ 2,792,423 | $ 2,882,520 | $ 2,771,471 |
Less Other Intangible Assets | (1,294) | (1,335) | (1,462) |
Tangible Assets | $ 2,791,129 | $ 2,881,185 | $ 2,770,009 |
Total Stockholders' Equity | $ 389,105 | $ 378,364 | $ 293,718 |
Less Other Intangible Assets | (1,294) | (1,335) | (1,462) |
Tangible Stockholders' Equity | $ 387,811 | $ 377,029 | $ 292,256 |
Total Stockholders' Equity to Total Assets Ratio | 13.93% | 13.13% | 10.60% |
Tangible Common Equity to Tangible Assets Ratio | 13.89% | 13.09% | 10.55% |
Common Shares Outstanding | 31,588,767 | 31,496,540 | 31,489,201 |
Tangible Common Equity Per Common Share | $ 12.28 | $ 11.97 | $ 9.28 |
HANMI BANK | |||
Total Assets | $ 2,786,691 | $ 2,877,041 | $ 2,766,780 |
Less Other Intangible Assets | -- | -- | (3) |
Tangible Assets | $ 2,786,691 | $ 2,877,041 | $ 2,766,777 |
Total Stockholders' Equity | $ 420,755 | $ 439,986 | $ 351,677 |
Less Other Intangible Assets | -- | -- | (3) |
Tangible Stockholders' Equity | $ 420,755 | $ 439,986 | $ 351,674 |
Total Stockholders' Equity to Total Assets Ratio | 15.10% | 15.29% | 12.71% |
Tangible Common Equity to Tangible Assets Ratio | 15.10% | 15.29% | 12.71% |
CONTACT: Hanmi Financial Corporation Shick (Mark) Yoon SVP & Chief Financial Officer Direct Phone: 213-427-5636 David Yang VP, Investor Relations & Corporate Strategy Direct Phone: 213-637-4798