EXHIBIT 99.1

Hanmi’s Second Quarter Results Driven by Strong Loan Production and 20% Year-Over-Year Growth in Loans

2016 Second Quarter Highlights:    

LOS ANGELES, July 19, 2016 (GLOBE NEWSWIRE) -- Hanmi Financial Corporation (NASDAQ:HAFC) (or “Hanmi”), the holding company for Hanmi Bank (the “Bank”), today reported second quarter net income of $14.1 million, or $0.44 per diluted share, compared with $14.8 million, or $0.46 per diluted share, for the first quarter of 2016 and $14.0 million, or $0.44 per diluted share, for the second quarter of 2015.

For the first six months of 2016, net income increased 15.6% to $29.0 million, or $0.90 per diluted share, compared with $25.0 million, or $0.79 per diluted share, for the first six months of 2015.

Mr. C. G. Kum, President and Chief Executive Officer, said, “Our strong results in the second quarter were highlighted by a 27.5% year-over-year increase in new loan production, which helped drive loans receivable up by 4.3% compared with the prior quarter and an impressive 19.9% year-over-year. In addition, I am also pleased with the effort of our retail branch network as money market and savings account deposits increased 9.8% during the quarter and 27.4% year-over-year.”

Mr. Kum continued, “Our ongoing success in repositioning the balance sheet to deploy liquidity into loans is evident in our improving net interest margin, which increased by 16 basis points in the quarter and 36 basis points year-over-year after excluding the effects of acquisition accounting. Importantly, our efficiency ratio of 56.46% improved by 79 basis points on a linked quarter basis, led by the strength of our lending franchise and careful expense management. Looking ahead, Hanmi remains well positioned to drive long-term sustainable growth in the second half of 2016 and beyond.”

Quarterly Results
(In thousands, except per share data)

  As of  or for the Three Months Ended  As of or for the Six Months Ended
 June 30, March 31, June 30, June 30, June 30,
  2016   2016   2015   2016   2015 
          
Net income$  14,148  $  14,804  $  13,984  $  28,952  $  25,038 
Net income per diluted common share$  0.44  $  0.46  $  0.44  $  0.90  $  0.79 
          
Assets$  4,441,333  $  4,310,748  $  3,970,770  $  4,441,333  $  3,970,770 
Loans receivable$  3,449,310  $  3,306,479  $  2,876,906  $  3,449,310  $  2,876,906 
Deposits$  3,589,289  $  3,499,992  $  3,439,781  $  3,589,289  $  3,439,781 
          
Pre-tax, pre-provision earnings on average assets 2.00%  1.85%  2.11%  1.92%  1.87%
Return on average assets 1.32%  1.41%  1.39%  1.36%  1.23%
Return on average stockholders' equity 10.98%  11.92%  11.83%  11.41%  10.81%
Net interest margin (1) 4.02%  3.98%  3.97%  4.00%  3.93%
Net interest margin excluding acquisition accounting (1) 3.84%  3.68%  3.48%  3.75%  3.38%
Efficiency ratio 56.46%  57.25%  56.04%  56.84%  60.52%
Efficiency ratio excluding merger and integration costs 56.46%  57.25%  55.76%  56.84%  58.71%
          
Tangible common equity to tangible assets (2) 11.79%  11.82%  11.86%  11.79%  11.86%
Tangible common equity per common share (2)$  16.23  $  15.79  $  14.73  $  16.23  $  14.73 
          
(1) Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate. 
(2) Refer to "Non-GAAP Financial Measures" for further details.
 

Results of Operations 
Second quarter net interest income increased $1.4 million or 3.7% to $40.0 million from $38.6 million for the first quarter and increased $2.9 million or 7.8% from the same period last year primarily from the increase in loans. Year-to-date, net interest income improved 5.4% to $78.6 million from $74.6 million for the first six months of 2015 principally because of the increase in loans.

Net interest margin (on a taxable equivalent basis) for the second quarter of 2016 was 4.02% up from 3.98% for the first quarter and 3.97% for the year-ago period. Net interest margin (excluding acquisition accounting) was 3.84%, up 16 basis points from the preceding quarter and 36 basis points from the second quarter last year. The increase in net interest margin from the preceding quarter was due to loan growth and loan prepayment penalties, while the increase from last year was due to loan growth and the change in the mix of earning assets. For the first six months of 2016, net interest margin was 4.00% compared with 3.93% for the first six months of 2015.

The impact of acquisition accounting adjustments on core loan yield, core deposit cost, net interest income and net interest margin are summarized in the following tables. 

  Three Months Ended  Six Months Ended  
 June 30, March 31, June 30, June 30, June 30,  
  2016   2016   2015   2016   2015   
Core loan yield 4.78%  4.67%  4.78%  4.72%  4.74%  
Accretion of discount on purchased loans 0.13%  0.25%  0.43%  0.20%  0.53%  
As reported 4.91%  4.92%  5.21%  4.92%  5.27%  
            
Core deposit cost 0.52%  0.54%  0.61%  0.53%  0.62%  
Accretion of time deposits premium 0.09%  0.11%  0.17%  0.10%  0.18%  
As reported 0.43%  0.43%  0.44%  0.43%  0.44%  
            
 Three Months Ended
 June 30, 2016 March 31,2016 June 30,2015
  Amount   Rate   Amount   Rate   Amount   Rate
      (in thousands)     
Net interest income and net interest margin excluding acquisition accounting (1)$  38,671    3.84% $  36,164    3.68% $  32,568    3.48%
Accretion of discount on Non-PCI loans   994   0.10%    1,754   0.18%    2,606   0.28%
Accretion of discount on PCI loans   97   0.01%    277   0.03%    467   0.05%
Accretion of time deposits premium   791   0.08%    942   0.10%    1,504   0.16%
Amortization of subordinated debentures discount   (62)  -0.01%    (56)  -0.01%    (41)    - 
  Net impact   1,820   0.18%    2,917   0.30%    4,536   0.49%
As reported, on a fully taxable equivalent basis (1)$  40,491    4.02% $  39,081    3.98% $  37,104    3.97%
            
 Six Months Ended    
 June 30, 2016 June 30, 2015    
  Amount   Rate   Amount   Rate     
    (in thousands)       
Net interest income and net interest margin excluding acquisition accounting$  74,836    3.75% $  64,114    3.38%    
Accretion of discount on Non-PCI loans   2,748   0.14%    6,117   0.32%    
Accretion of discount on PCI loans   374   0.02%    1,310   0.07%    
Accretion of time deposits premium   1,733   0.09%    3,110   0.16%    
Amortization of subordinated debentures discount   (118)  0.00%    (79)  -     
  Net impact   4,737   0.25%    10,458   0.55%    
As reported, on a fully taxable equivalent basis (1)$  79,573    4.00% $  74,572    3.93%    
            
(1) Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.
    
     

For the second quarter of 2016, Hanmi recorded a negative provision for loan losses of $1.5 million, unchanged from the prior quarter and compared with $2.4 million in the second quarter last year. For the first six months of 2016 and 2015, the negative loan loss provision was $3.0 million and $4.1 million, respectively.

Second quarter noninterest income increased $2.4 million, or 34.7%, to $9.4 million from $7.0 million for the first quarter of 2016 primarily due to a $1.3 million increase in disposition gains on PCI loans and a $0.9 million increase in gain on sales of SBA loans. Disposition gains on PCI loans were $2.0 million for the second quarter of 2016, compared with $0.7 million for the prior quarter, and $2.5 million for the second quarter last year as PCI loans decreased $4.8 million for the second quarter of 2016, while they declined $0.2 million for the first quarter of 2016 and decreased $7.2 million for the second quarter of 2015. Gains on sales of SBA loans were $1.8 million for the second quarter 2016, compared with $0.9 million for the first quarter of 2016 and $1.6 million for the year-ago period as the volume of SBA loans sold increased to $20.2 million from $12.4 million for the preceding quarter and $19.3 million for the same quarter last year.

For the first half of 2016, noninterest income decreased $5.6 million, or 25.7%, to $16.3 million from $22.0 million for the same period last year primarily due to a $4.1 million reduction in gain on sale of securities, a $1.1 million decrease in disposition gains on PCI loans and a $0.6 million decrease in gain on sales of SBA loans. There were no sales of securities in the first half of 2016, while securities transactions resulted in gains of $4.1 million for the same period last year. Disposition gains on PCI loans were $2.6 million for the first six months of 2016, compared with $3.7 million for the same period last year as PCI loans decreased $5.0 million for the first half of 2016 and declined $10.6 million for the same period last year. Gains on sales of SBA loans were $2.6 million for the first six months 2016, compared with $3.3 million for the first six months of 2015 as the volume of SBA loans sold decreased to $32.6 million from $39.2 million for the same period last year.

Noninterest expense for the second quarter increased $1.8 million, or 6.9%, to $27.9 million from $26.1 million for the first quarter primarily because first quarter noninterest expenses related to advertising and promotions, occupancy and equipment, and provisions for SBA recourse allowances were unusually low or negative. During the first quarter, Hanmi delayed spending associated with a new tagline campaign related to the new Hanmi logo until the second quarter. In addition, the first quarter included a $1.3 million reduction in SBA recourse allowance (recorded in other operating expense). Finally, the first quarter also benefitted from a $0.4 million reduction in occupancy and equipment arising from a property tax refund and an early lease termination on a building.

Noninterest expense increased $0.8 million, or 3.1%, from $27.0 million for the second quarter last year primarily due to an increase in salaries and employee benefits and higher other operating expenses, partially offset by lower occupancy and equipment expense from the branch closure and consolidations completed in the third quarter last year.

For the first half of 2016, noninterest expense decreased $4.5 million, or 7.7%, to $53.9 million from $58.4 million for the same period last year primarily due to reductions in merger and integration costs, professional fees and data processing fees related to the August 2014 acquisition of Central Bancorp, Inc. (“CBI”), along with lower salaries and employee benefits and occupancy and equipment expense from the branch closure and consolidation completed in the third quarter last year. As a result of careful management of noninterest expense, coupled with the improvements in revenue from the growth in earning assets, the efficiency ratio improved to 56.84% for the first six month of 2016 from 60.52% for the first six months of 2015.

Hanmi recorded a provision for income taxes of $8.9 million for the second quarter of 2016, representing an effective tax of 38.5%, compared with $6.2 million or 29.5% for the preceding quarter and $9.6 million or 40.8% for the second quarter of 2015. Income tax expense for the first quarter of 2016 included a $1.8 million benefit arising from the finalization of the 2014 amended income tax returns. The effective tax rate for the first quarter of 2016 would have been 38.0% without this benefit.

For the first half of 2016, Hanmi recorded a provision for income taxes of $15.0 million, representing an effective tax of 34.2%, compared with $17.2 million or 40.7% for the same period last year.

Financial Position
Total assets were $4.44 billion at June 30, 2016, a 3.0% increase from $4.31 billion at March 31, 2016, and a 11.9% increase from $3.97 billion at June 30, 2015. The increases in total assets were primarily due to increases in loans receivable.

Loans receivable, before the allowance for loan losses, were $3.45 billion at June 30, 2016, up 4.3% from $3.31 billion at March 31, 2016, and up 19.9% from $2.88 billion at June 30, 2015. The increase in loans from the end of the 2015 second quarter reflects Hanmi’s strong loan production. Loans held for sale, representing the guaranteed portion of SBA loans, were $12.8 million at June 30, 2016, compared with $2.6 million at the end of the 2016 first quarter and $4.2 million at the end of the 2015 second quarter. 

New loan production for the 2016 second quarter was $265.2 million, up 27.5% from $208.1 million for the second quarter last year and outpaced $112.0 million of loan payoffs. Second quarter 2016 new loan production was comprised of $197.2 million of commercial real estate loans, $19.2 million of commercial and industrial loans, $46.6 million of SBA loans, and $2.2 million of consumer loans. For the 2016 first quarter, new loan production was $208.8 million while loan payoffs were $59.9 million. Loan purchases for the 2016 second quarter were $66.5 million, compared with $30.7 million in the first quarter of 2016. SBA loan sales for the 2016 second quarter were $20.2 million, compared with $12.4 million for the first quarter of 2016.

Deposits were $3.59 billion at the end of the 2016 second quarter, compared with $3.50 billion at the end of the preceding quarter and $3.44 billion at the end of the second quarter of 2015. The cost of deposits was 0.43% for the second quarter of 2016, unchanged from the first quarter of 2016 and down from 0.44% for the second quarter a year ago.

At June 30, 2016, stockholders’ equity was $525.2 million, compared with $510.9 million and $472.7 million at March 31, 2016 and June 30, 2015, respectively. Tangible common stockholders’ equity was $523.6 million, or 11.79% of tangible assets, compared with $509.2 million, or 11.82% of tangible assets, and $470.9 million, or 11.86% of tangible assets at March 31, 2016 and June 30, 2015, respectively. Tangible book value per share was $16.23, up 2.8% from the preceding quarter and 10.2% from a year ago.   

During the second quarter, Hanmi declared a cash dividend on its common stock of $0.14 per share, unchanged from the prior quarter and up 27% from a year ago. The dividend was paid on June 30, 2016, to stockholders of record as of the close of business on June 16, 2016. 

Asset Quality
Nonperforming loans, excluding PCI loans, were $12.3 million or 0.36% of loans at the end of the second quarter of 2016, compared with $16.3 million or 0.50% of loans at the end of the first quarter of 2016 and $28.0 million, or 0.99% of loans at the end of the second quarter last year.

OREO was $11.8 million at the end of the second quarter of 2016, up from $9.4 million at the end of the prior quarter. Classified loans were $27.4 million, or 0.79% of loans, at June 30, 2016, compared with $32.3 million, or 0.98% of loans, at March 31, 2016, and $44.8 million, or 1.56% of loans, a year ago. Nonperforming assets were $24.2 million at the end of the second quarter of 2016, or 0.54% of assets, compared with 0.60% of assets at the end of the prior quarter and 1.00% of assets at the end of the same quarter last year.

Gross charge-offs for the second quarter of 2016 were $798,000, compared with $636,000 for the preceding quarter and $1.2 million for the same period a year ago. Recoveries of previously charged-off loans for the second quarter of 2016 were $995,000, compared with $252,000 for the preceding quarter and $1.4 million for the second quarter of 2015. As a result, there were net recoveries of $197,000 for the second quarter of 2016, compared to charge-offs of $384,000 for the preceding quarter and net recoveries of $272,000 for the year ago period. 

The allowance for loan losses was $39.7 million as of June 30, 2016, generating an allowance of loan losses to loans receivable ratio of 1.15% compared with 1.24% as of March 31, 2016 and 1.77% as of June 30, 2015.

Conference Call       
Management will host a conference call today, July 19, 2016 at 1:00 p.m. PT (4:00 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 1-877-407-9039 before 1:00 p.m. PT, 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, California, Hanmi Financial Corporation owns Hanmi Bank, which serves multi-ethnic communities through its network of 42 full-service branches and 6 loan production offices in California, Texas, Illinois, Virginia, New Jersey, New York, Colorado, Washington and Georgia. Hanmi Bank specializes in real estate, commercial, SBA and trade finance lending to small and middle market businesses. Additional information is available at www.hanmi.com.

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 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 of Hanmi Bank to make distributions to Hanmi Financial, which is restricted by certain factors, including Hanmi Bank’s retained earnings, net income, prior distributions made, and certain other financial tests; 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 loan 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, including, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2015, our Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K that we will file 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)

 June 30, March 31, Percentage June 30, Percentage
  2016   2016  Change  2015  Change
Assets         
Cash and due from banks$  156,632  $  137,464   13.9% $  153,231   2.2%
Securities available for sale, at fair value   636,275     675,032   -5.7%    728,683   -12.7%
Loans held for sale, at the lower of cost or fair value   12,833     2,583   396.8%    4,158   208.6%
Loans receivable, net of allowance for loan losses   3,409,603     3,265,453   4.4%    2,826,086   20.6%
Accrued interest receivable   10,552     10,626   -0.7%    8,133   29.7%
Premises and equipment, net   29,752     30,112   -1.2%    30,656   -2.9%
Other real estate owned ("OREO"), net   11,846     9,411   25.9%    11,857   -0.1%
Customers' liability on acceptances   2,456     2,809   -12.6%    1,638   49.9%
Servicing assets   11,337     11,452   -1.0%    13,125   -13.6%
Other intangible assets, net   1,537     1,619   -5.1%    1,890   -18.7%
Federal Home Loan Bank ("FHLB") stock, at cost   16,385     16,385   0.0%    16,385   0.0%
Federal Reserve Bank ("FRB") stock, at cost   14,423     14,423   0.0%    13,517   6.7%
Income tax asset   52,161     56,456   -7.6%    82,819   -37.0%
Bank-owned life insurance   48,851     48,612   0.5%    48,041   1.7%
Prepaid expenses and other assets   26,690     28,311   -5.7%    30,551   -12.6%
Total assets$  4,441,333   $  4,310,748    3.0% $  3,970,770    11.9%
          
Liabilities and Stockholders' Equity         
Liabilities:         
Deposits:         
Noninterest-bearing$  1,189,528  $  1,172,444   1.5% $  1,061,823   12.0%
Interest-bearing   2,399,761     2,327,548   3.1%    2,377,958   0.9%
Total deposits   3,589,289     3,499,992   2.6%    3,439,781   4.3%
Accrued interest payable   3,107     3,249   -4.4%    3,443   -9.8%
Bank's liability on acceptances   2,456     2,809   -12.6%    1,638   49.9%
FHLB advances   280,000     250,000   12.0%    -    - 
Servicing liabilities   3,921     4,588   -14.5%    5,368   -27.0%
FDIC loss sharing liability   18     1,266   -98.6%    116   -84.5%
Subordinated debentures   18,821     18,759   0.3%    18,623   1.1%
Accrued expenses and other liabilities   18,536     19,225   -3.6%    29,061   -36.2%
Total liabilities   3,916,148      3,799,888    3.1%    3,498,030    12.0%
          
Stockholders' equity:         
Common stock   33     33   0.0%    257   -87.2%
Additional paid-in capital   560,089     558,945   0.2%    556,289   0.7%
Accumulated other comprehensive income   9,121     5,364   70.0%    423   2056.3%
Retained earnings (accumulated deficit)   26,396     16,742   57.7%    (14,371)  -283.7%
Less treasury stock   (70,454)    (70,224)  0.3%    (69,858)  0.9%
Total stockholders' equity   525,185      510,860    2.8%    472,740    11.1%
Total liabilities and stockholders' equity$  4,441,333   $  4,310,748    3.0% $  3,970,770    11.9%
                    

Hanmi Financial Corporation and Subsidiaries
Consolidated Statement of Income (Unaudited)
(In thousands, except share and per share data)

  Three Months Ended
 June 30, March 31, Percentage June 30, Percentage
  2016   2016  Change  2015  Change
Interest and dividend income:         
Interest and fees on loans$  40,645  $  39,067   4.0% $  36,915   10.1%
Interest on securities   2,886     3,017   -4.3%    2,979   -3.1%
Dividends on FRB and FHLB stock   579     542   6.8%    1,116   -48.1%
Interest on deposits in other banks   49     48   2.1%    40   22.5%
Total interest and dividend income   44,159     42,674   3.5%    41,050   7.6%
Interest expense:         
Interest on deposits   3,684     3,727   -1.2%    3,802   -3.1%
Interest on subordinated debentures   196     183   7.1%    151   29.8%
Interest on FHLB advances   299     195   53.3%    4   7375.0%
Total interest expense   4,179     4,105   1.8%    3,957   5.6%
Net interest income before provision for loan losses   39,980     38,569   3.7%    37,093   7.8%
(Negative provision) provision for loan losses   (1,515)    (1,525)  -0.7%    (2,403)  -37.0%
Net interest income after provision for loan losses   41,495     40,094   3.5%    39,496   5.1%
Noninterest income:         
Service charges on deposit accounts   2,898     3,001   -3.4%    3,169   -8.6%
Trade finance and other service charges and fees   1,064     1,044   1.9%    1,109   -4.1%
Gain on sale of Small Business Administration ("SBA") loans   1,774     858   106.8%    1,573   12.8%
Disposition gains on Purchased Credit Impaired ("PCI") loans   1,963     659   197.9%    2,470   -20.5%
Net gain on sales of securities   -     -   -     1,912   -100.0%
Other operating income   1,674     1,399   19.7%    900   86.0%
Total noninterest income   9,373     6,961   34.7%    11,133   -15.8%
Noninterest expense:         
Salaries and employee benefits   16,061     15,698   2.3%    15,542   3.3%
Occupancy and equipment   3,938     3,496   12.6%    4,224   -6.8%
Data processing   1,454     1,436   1.3%    1,335   8.9%
Professional fees   1,509     1,464   3.1%    1,701   -11.3%
Supplies and communications   709     736   -3.7%    928   -23.6%
Advertising and promotion   1,094     522   109.6%    1,046   4.6%
OREO expense   183     465   -60.6%    (13)  -1507.7%
Other operating expenses   2,915     2,251   29.5%    2,127   37.0%
Merger and integration costs   -     -   -     136   -100.0%
Total noninterest expense   27,863     26,068   6.9%    27,026   3.1%
Income before provision for income taxes   23,005     20,987   9.6%    23,603   -2.5%
Income tax expense   8,857     6,183   43.2%    9,619   -7.9%
Net income$  14,148   $  14,804    -4.4% $  13,984    1.2%
          - 
Basic earnings per share:$  0.44  $  0.46    $  0.44   
Diluted earnings per share:$  0.44  $  0.46    $  0.44   
          
Weighted-average shares outstanding:         
Basic   31,882,489     31,846,371       31,774,692   
Diluted   32,030,080     31,928,103       31,908,719   
Common shares outstanding   32,260,320     32,249,512       31,974,842   
                

Hanmi Financial Corporation and Subsidiaries
Consolidated Statement of Income (Unaudited)
(In thousands, except share and per share data)

  Six Months Ended
 June 30, June 30, Percentage
  2016   2015  Change
Interest and dividend income:     
Interest and fees on loans$  79,712  $  73,949   7.8%
Interest on securities   5,903     6,853   -13.9%
Dividends on FRB and FHLB stock   1,121     1,598   -29.8%
Interest on deposits in other banks   97     88   10.2%
Total interest and dividend income   86,833     82,488   5.3%
Interest expense:     
Interest on deposits   7,410     7,582   -2.3%
Interest on FHLB advances   494     60   723.3%
Interest on subordinated debentures   379     296   28.0%
Total interest expense   8,283     7,938   4.3%
Net interest income before provision for loan losses   78,550     74,550   5.4%
Negative provision for loan losses   (3,040)    (4,076)  -25.4%
Net interest income after provision for loan losses   81,590     78,626   3.8%
Noninterest income:     
Service charges on deposit accounts   5,899     6,380   -7.5%
Trade finance and other service charges and fees   2,109     2,376   -11.2%
Gain on sale of Small Business Administration ("SBA") loans   2,632     3,257   -19.2%
Net gain on sales of securities   -     4,096   -100.0%
Disposition gains on Purchased Credit Impaired ("PCI") loans   2,622     3,693   -29.0%
Other operating income   3,072     2,181   40.9%
Total noninterest income   16,334     21,983   -25.7%
Noninterest expense:     
Salaries and employee benefits   31,759     31,926   -0.5%
Occupancy and equipment   7,434     8,527   -12.8%
Data processing   2,889     3,467   -16.7%
Professional fees   2,974     4,042   -26.4%
Supplies and communications   1,445     1,758   -17.8%
Advertising and promotion   1,616     1,569   3.0%
OREO expense   648     404   60.4%
Other operating expenses   5,167     4,978   3.8%
Merger and integration costs   -     1,747   -100.0%
Total noninterest expense   53,932     58,418   -7.7%
Income before provision for income taxes   43,992     42,191   4.3%
Income tax expense   15,040     17,153   -12.3%
Net income$  28,952   $  25,038    15.6%
        
Basic earnings per share:$  0.90  $  0.79   
Diluted earnings per share:$  0.90  $  0.79   
      
Weighted-average shares outstanding:     
Basic   31,864,427     31,761,067   
Diluted   32,001,325     31,874,484   
Common shares outstanding   32,260,320     31,974,842   
          

Hanmi Financial Corporation and Subsidiaries
Selected Financial Data (Unaudited)
(In thousands, except ratios)

  As of or for the Three Months Ended   As of or for the Six Months Ended
 June 30, March 31, June 30, June 30, June 30,
  2016   2016   2015   2016   2015 
Average balances:         
Loans (1) $  3,328,416  $  3,192,832  $  2,839,601  $  3,260,625  $  2,829,813 
Securities   657,756     682,370     814,126     670,063     892,349 
Interest-earning assets   4,055,578     3,949,788     3,749,011     4,002,683     3,823,942 
Assets   4,325,500     4,221,076     4,023,750     4,273,288     4,101,420 
Deposits   3,479,365     3,482,986     3,484,267     3,481,176     3,505,379 
Borrowings   296,858     200,590     26,233     248,724     85,953 
Interest-bearing liabilities   2,605,737     2,544,754     2,467,440     2,575,246     2,554,301 
Stockholders’ equity   518,015     499,469     474,134     508,742     467,019 
Tangible equity (2)   516,424     497,797     472,183     507,111     465,020 
          
Performance ratios:         
Pre-tax, pre-provision earnings on average assets (3) (4) 2.00%  1.85%  2.11%  1.92%  1.87%
Return on average assets (3) (4) 1.32%  1.41%  1.39%  1.36%  1.23%
Return on average stockholders’ equity (3) (4) 10.98%  11.92%  11.83%  11.41%  10.81%
Return on average tangible equity (3) (4) 11.02%  11.96%  11.88%  11.45%  10.86%
Efficiency ratio 56.46%  57.25%  56.04%  56.84%  60.52%
Efficiency ratio excluding merger and integration costs 56.46%  57.25%  55.76%  56.84%  58.71%
Net interest margin (3) (7) 4.02%  3.98%  3.97%  4.00%  3.93%
Net interest margin excluding acquisition accounting (3) (7) 3.84%  3.68%  3.48%  3.75%  3.38%
          
Allowance for loan losses:         
Balance at beginning of period$  41,026  $  42,935  $  52,951  $  42,935  $  52,666 
(Negative provision) provision for loan losses   (1,515)    (1,525)    (2,403)    (3,040)    (4,076)
Net (charge-offs) recoveries   196     (384)    272     (188)    2,230 
Balance at end of period$  39,707  $  41,026  $  50,820  $  39,707  $  50,820 
          
Asset quality ratios:         
Nonperforming Non-PCI loans to loans (5) 0.36%  0.50%  0.99%  0.36%  0.99%
Nonperforming assets to assets (5) 0.54%  0.60%  1.00%  0.54%  1.00%
Net loan charge-offs (recoveries) to average loans (3) -0.02%  0.05%  -0.04%  0.01%  -0.16%
Allowance for loan losses to loans 1.15%  1.24%  1.77%  1.15%  1.77%
Allowance for loan losses to nonperforming Non-PCI loans (5) (6) 277.60%  217.38%  176.53%  277.60%  176.53%
          
Allowance for off-balance sheet items:         
Balance at beginning of period$  1,220  $  986  $  1,054  $  986  $  1,366 
Provision (negative provision) for loan losses   255     234     (92)    489     (404)
Balance at end of period$  1,475  $  1,220  $  962  $  1,475  $  962 
          
Nonperforming assets (5):         
Nonaccrual Non-PCI loans$  12,341  $  16,276  $  28,023     
Loans 90 days or more past due and still accruing   -     -     -     
Nonperforming Non-PCI loans   12,341     16,276     28,023     
OREO, net   11,846     9,411     11,857     
Nonperforming assets$  24,187  $  25,687  $  39,880     
          
Delinquent loans:         
Loans, 30 to 89 days past due and still accruing$  1,517  $  5,974  $  9,007     
Delinquent loans to loans 0.04%  0.18%  0.31%    
          
Acquired loans         
PCI loans, net of discounts$  15,020  $  19,834     33,857     
Allowance for loan losses on PCI loans$  5,448  $  5,645     1,352     
Non-PCI loans, net of discounts$  117,750  $  139,869     188,776     
Unamortized acquisition discounts on Non-PCI loans$  7,735  $  9,021     15,777     
                

Hanmi Financial Corporation and Subsidiaries
Selected Financial Data (Unaudited)
(In thousands, except ratios)

 June 30, March 31, June 30,
  2016   2016   2015 
Loan portfolio:     
Commercial real estate loans$  2,835,077  $  2,729,527  $  2,415,836 
Residential real estate loans   296,496     256,488     173,291 
Commercial and industrial loans   293,073     295,632     261,437 
Consumer loans   24,664     24,832     26,342 
Loans receivable   3,449,310     3,306,479     2,876,906 
Loans held for sale, at the lower of cost or fair value   12,833     2,583     4,158 
Total loans$  3,462,143  $  3,309,062  $  2,881,064 
      
Loan mix:     
Commercial real estate loans 81.8%  82.4%  83.8%
Residential real estate loans 8.6%  7.8%  6.0%
Commercial and industrial loans 8.5%  8.9%  9.1%
Consumer loans 0.7%  0.8%  0.9%
Loans held for sale, at the lower of cost or fair value 0.4%  0.1%  0.2%
Total loans 100.0%  100.0%  100.0%
      
Deposit portfolio:     
Demand: noninterest-bearing$  1,189,528  $  1,172,444  $  1,061,823 
interest-bearing   92,776     99,141     95,825 
Money market and savings   1,023,421     931,915     803,333 
Time deposits of $250,000 or less   891,197     948,346     1,117,522 
Time deposits of more than $250,000   392,367     348,146     361,278 
Total deposits$  3,589,289  $  3,499,992  $  3,439,781 
      
Deposit mix:     
Demand: noninterest-bearing 33.1%  33.5%  30.9%
interest-bearing 2.6%  2.8%  2.8%
Money market and savings 28.5%  26.6%  23.4%
Time deposits of $250,000 or less 24.9%  27.1%  32.4%
Time deposits of more than $250,000 10.9%  10.0%  10.5%
Total deposits 100.0%  100.0%  100.0%
      
Capital ratios (8):     
Hanmi Financial     
Total risk-based capital 15.24%  15.37%  15.32%
Tier 1 risk-based capital 14.04%  14.15%  14.06%
Common equity tier 1 capital 13.88%  13.99%  14.06%
Tier 1 leverage capital ratio 11.74%  11.70%  10.99%
Hanmi Bank     
Total risk-based capital 14.67%  14.78%  15.25%
Tier 1 risk-based capital 13.46%  13.56%  13.99%
Common equity tier 1 capital 13.46%  13.56%  13.99%
Tier 1 leverage capital ratio 11.26%  11.22%  10.94%
      
(1)  Includes loans held for sale 
(2)  Refer to "Non-GAAP Financial Measures" for further details.
(3)  Annualized     
(4)  Amount calculated based on net income from continuing operations
(5)  Excludes PCI loans     
(6)  Excludes allowance for loan losses allocated to PCI loans
(7)  Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.
(8) Preliminary ratios for June 30, 2016 
      

Hanmi Financial Corporation and Subsidiaries
Average Balance, Average Yield Earned and Average Rate Paid (Unaudited)
(In thousands, except ratios)

 Three Months Ended
 June 30, 2016 March 31, 2016 June 30, 2015
  InterestAverage  InterestAverage  InterestAverage
 AverageIncome /Yield / AverageIncome /Yield / AverageIncome /Yield /
 BalanceExpenseRate BalanceExpenseRate BalanceExpenseRate
Assets           
Interest-earning assets:           
Loans (1)$  3,328,416 $  40,645  4.91% $  3,192,832 $  39,067  4.92% $  2,839,601 $  36,915  5.21%
Securities (2)   657,756    3,397  2.07%    682,370    3,529  2.07%    814,126    2,990  1.47%
FRB and FHLB stock   30,808    579  7.52%    30,497    542  7.11%    29,938    1,116  14.91%
Interest-bearing deposits in other banks   38,598    49  0.51%    44,089    48  0.44%    65,346    40  0.25%
Total interest-earning assets   4,055,578    44,670  4.43%    3,949,788    43,186  4.40%    3,749,011    41,061  4.39%
            
Noninterest-earning assets:           
Cash and due from banks   114,247       114,664       89,313   
Allowance for loan losses   (41,483)      (42,519)      (53,159)  
Other assets   197,158       199,143       238,585   
Total noninterest-earning assets   269,922       271,288       274,739   
            
Total assets$  4,325,500     $  4,221,076     $  4,023,750    
            
Liabilities and Stockholders' Equity           
Interest-bearing liabilities:           
Deposits:           
Demand: interest-bearing$  96,397 $  19  0.08% $  95,560 $  19  0.08% $  94,686 $  32  0.14%
Money market and savings   944,355    1,212  0.52%    902,037    1,084  0.48%    821,498    1,002  0.49%
Time deposits   1,268,127    2,453  0.78%    1,346,567    2,624  0.78%    1,525,023    2,768  0.73%
FHLB advances   278,077    299  0.43%    181,868    195  0.43%    7,637    4  0.21%
Subordinated debentures   18,781    196  4.20%    18,722    183  3.93%    18,596    151  3.26%
Total interest-bearing liabilities   2,605,737    4,179  0.65%    2,544,754    4,105  0.65%    2,467,440    3,957  0.64%
            
Noninterest-bearing liabilities:           
Demand deposits: noninterest-bearing   1,170,486       1,138,822       1,043,060   
Other liabilities   31,262       38,031       39,116   
Total noninterest-bearing liabilities   1,201,748       1,176,853       1,082,176   
            
Total liabilities   3,807,485       3,721,607       3,549,616   
Stockholders' equity   518,015       499,469       474,134   
            
Total liabilities and stockholders' equity$  4,325,500     $  4,221,076     $  4,023,750    
            
Net interest income $  40,491     $  39,081     $  37,104   
            
Cost of deposits   0.43%    0.43%    0.44%
Net interest spread   3.78%    3.75%    3.75%
Net interest margin   4.02%    3.98%    3.97%
            
(1)  Includes loans held for sale 
(2)  Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.
      

Hanmi Financial Corporation and Subsidiaries
Average Balance, Average Yield Earned and Average Rate Paid (Unaudited)
(In thousands, except ratios)

 Six Months Ended
 June 30, 2016 June 30, 2015
  InterestAverage  InterestAverage
 AverageIncome /Yield / AverageIncome /Yield /
 BalanceExpenseRate BalanceExpenseRate
Assets       
Interest-earning assets:       
Loans (1)$  3,260,625 $  79,712  4.92% $  2,829,813 $  73,949  5.27%
Securities (2)   670,063    6,926  1.03%    892,349    6,875  0.77%
FRB and FHLB stock   30,652    1,121  3.66%    29,896    1,598  5.35%
Interest-bearing deposits in other banks   41,343    97  0.47%    71,884    88  0.25%
Total interest-earning assets   4,002,683    87,856  4.41%    3,823,942    82,510  4.35%
        
Noninterest-earning assets:       
Cash and due from banks   114,455       87,842   
Allowance for loan losses   (42,001)      (53,238)  
Other assets   198,151       242,874   
Total noninterest-earning assets   270,605       277,478   
        
Total assets$  4,273,288     $  4,101,420    
        
Liabilities and Stockholders' Equity       
Interest-bearing liabilities:       
Deposits:       
Demand: interest-bearing$  95,979 $  38  0.08% $  88,358 $  59  0.13%
Money market and savings   923,196    2,295  0.50%    821,113    1,974  0.48%
Time deposits   1,307,347    5,077  0.78%    1,558,877    5,549  0.72%
FHLB advances   229,973    494  0.43%    67,376    60  0.18%
Subordinated debentures   18,751    379  4.06%    18,577    296  3.21%
Total interest-bearing liabilities   2,575,246    8,283  0.65%    2,554,301    7,938  0.63%
        
Noninterest-bearing liabilities:       
Demand deposits: noninterest-bearing   1,154,654       1,037,031   
Other liabilities   34,646       43,069   
Total noninterest-bearing liabilities   1,189,300       1,080,100   
        
Total liabilities   3,764,546       3,634,401   
Stockholders' equity   508,742       467,019   
        
Total liabilities and stockholders' equity$  4,273,288     $  4,101,420    
        
Net interest income $  79,573     $  74,572   
        
Cost of deposits   0.43%    0.44%
Net interest spread   3.76%    3.72%
Net interest margin   4.00%    3.93%
        
(1)  Includes loans held for sale 
(2)  Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.
  

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’s capital strength. Tangible equity is calculated by subtracting goodwill and other intangible assets from stockholders’ equity. Banking and financial institution regulators also exclude goodwill and other intangible assets from 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. 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 share, per share data and ratios)

 June 30, March 31, June 30,
Hanmi Financial Corporation 2016   2016   2015 
Assets$  4,441,333  $  4,310,748  $  3,970,770 
Less other intangible assets   (1,537)    (1,619)    (1,890)
Tangible assets$  4,439,796  $  4,309,129  $  3,968,880 
      
Stockholders' equity$  525,185  $  510,860  $  472,740 
Less other intangible assets   (1,537)    (1,619)    (1,890)
Tangible stockholders' equity$  523,648  $  509,241  $  470,850 
      
Stockholders' equity to assets 11.82%  11.85%  11.91%
Tangible common equity to tangible assets 11.79%  11.82%  11.86%
      
Common shares outstanding   32,260,320     32,249,512     31,974,842 
Tangible common equity per common share$  16.23  $  15.79  $  14.73 


Investor Contacts:
Romolo (Ron) Santarosa
Senior Executive Vice President & Chief Financial Officer
213-427-5636

Lasse Glassen
Addo Investor Relations
310-829-5400