EXHIBIT 99.1

Hanmi Reports Strong Loan and Deposit Growth for Third Quarter 2016

2016 Third Quarter Highlights:      

LOS ANGELES, Oct. 18, 2016 (GLOBE NEWSWIRE) -- Hanmi Financial Corporation (NASDAQ:HAFC) (or “Hanmi”), the holding company for Hanmi Bank (the “Bank”), today reported third quarter net income of $13.1 million, or $0.41 per diluted share, down $0.03 per diluted share from the prior quarter primarily due to $1.2 million lower disposition gains on PCI loans and a $1.4 million charge to finalize prior year FDIC loss share claims, partially offset by a $1.0 million gain on the sale of a recently consolidated branch facility. 

For the first nine months of 2016, net income increased 7.9% to $42.1 million, or $1.31 per diluted share, compared with $39.0 million, or $1.22 per diluted share, for the first nine months of 2015.

Mr. C. G. Kum, President and Chief Executive Officer, said, “Hanmi’s performance in the third quarter was highlighted by solid loan growth coupled with successful deposit gathering activities. Total loans receivable increased 3% compared with the prior quarter and 17% from a year ago.  We are achieving this growth while maintaining our disciplined underwriting standards and strong overall asset quality.  Weighted average loan-to-value and debt coverage ratios on new commercial real estate loan originations for the third quarter were 50.8% and 1.73 times, respectively. I am also pleased with our deposit franchise as our money market and savings balances grew 21% in the quarter, resulting in total deposits increasing 5% for the quarter and 7% year-over-year.  Importantly, noninterest-bearing deposits increased 4% in the quarter and were up 11% from a year ago.”

Mr. Kum continued, “We remain highly focused on driving profitable growth across the enterprise. Considering the flat yield curve environment, our third quarter net interest margin of 3.86% remains strong. In addition, through the first nine months of the year, we have successfully reduced total noninterest expense by approximately 6% compared with the prior year. To further enhance operational efficiencies, we completed the closure and consolidation of two branches during the third quarter in Cerritos and Garden Grove, California and recently opened a new branch in Glenview, Illinois. Overall, our third quarter results were solid and I expect a strong finish to the year.”

Quarterly Results
(In thousands, except per share data)

  As of  or for the Three Months Ended  As of or for the Nine Months Ended
 September 30, June 30, September 30, September 30, September 30,
  2016   2016   2015   2016   2015 
          
Net income$  13,121  $  14,148  $  13,959  $  42,073  $  38,997 
Net income per diluted common share$  0.41  $  0.44  $  0.44  $  1.31  $  1.22 
          
Assets$  4,402,180  $  4,441,333  $  4,214,241  $  4,402,180  $  4,214,241 
Loans receivable$  3,552,659  $  3,449,310  $  3,045,072  $  3,552,659  $  3,045,072 
Deposits$  3,771,207  $  3,589,289  $  3,518,694  $  3,771,207  $  3,518,694 
          
Pre-tax, pre-provision earnings on average assets 1.80%  2.00%  2.05%  1.88%  1.93%
Return on average assets 1.19%  1.32%  1.38%  1.30%  1.28%
Return on average stockholders' equity 9.88%  10.98%  11.55%  10.90%  11.06%
Net interest margin (1) 3.86%  4.02%  3.81%  3.95%  3.89%
Net interest margin excluding acquisition accounting (1) 3.75%  3.84%  3.49%  3.76%  3.40%
Efficiency ratio 58.72%  56.46%  57.97%  57.47%  59.65%
Efficiency ratio excluding merger and integration costs 58.72%  56.46%  57.97%  57.47%  58.46%
          
Tangible common equity to tangible assets (2) 12.04%  11.79%  11.48%  12.04%  11.48%
Tangible common equity per common share (2)$  16.42  $  16.23  $  15.12  $  16.42  $  15.12 
 
(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 
Net interest income was $39.6 million for the 2016 third quarter compared with $40.0 million for the 2016 second quarter.  Although average loans increased 4.5% quarter-over-quarter, average money market and savings increased 20.9% and the average rate paid on these deposits increased 12 basis points leading to the slight decline in net interest income.  Year-to-date, net interest income improved 6.9% to $118.1 million compared with $110.5 million for the first nine months of 2015 principally because of the increase in loans.

Net interest margin (on a taxable equivalent basis) was 3.86% for the 2016 third quarter, down 16 basis points from 4.02% for the 2016 second quarter.  The decline was primarily due to lower acquisition accounting effects (seven basis points), lower loan yields (two basis points) and higher interest-bearing deposit rates (three basis points). For the first nine months of 2016, net interest margin was 3.95% compared with 3.89% for the first nine 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  Nine Months Ended  
 September 30, June 30, September 30, September 30, September 30,  
  2016   2016   2015   2016   2015   
Core loan yield 4.63%  4.78%  4.76%  4.69%  4.75%  
Accretion of discount on purchased loans 0.08%  0.13%  0.24%  0.15%  0.43%  
As reported 4.71%  4.91%  5.00%  4.84%  5.18%  
            
Core deposit cost 0.54%  0.52%  0.60%  0.53%  0.61%  
Accretion of time deposits premium 0.07%  0.09%  0.16%  0.09%  0.17%  
As reported 0.47%  0.43%  0.44%  0.44%  0.44%  
            
            
 Three Months Ended
 September 30, 2016 June 30,2016 September 30,2015
  Amount   Rate   Amount   Rate   Amount   Rate
      (in thousands)     
Net interest income and net interest margin excluding acquisition accounting (1)$  38,874    3.75% $  38,671    3.84% $  32,996    3.49%
Accretion of discount on Non-PCI loans   648   0.06%    994   0.10%    1,209   0.13%
Accretion of discount on PCI loans   26   0.00%    97   0.01%    514   0.05%
Accretion of time deposits premium   610   0.06%    791   0.08%    1,378   0.14%
Amortization of subordinated debentures discount   (67)  -0.01%    (62)  -0.01%    (46)  - 
Net impact   1,217   0.11%    1,820   0.18%    3,055   0.32%
As reported, on a fully taxable equivalent basis (1)$  40,091    3.86% $  40,491    4.02% $  36,051    3.81%
            
            
 Nine Months Ended    
 September 30, 2016 September 30, 2015    
  Amount   Rate   Amount   Rate     
    (in thousands)       
Net interest income and net interest margin excluding acquisition accounting$  113,710    3.76% $  97,109    3.40%    
Accretion of discount on Non-PCI loans   3,396   0.11%    7,326   0.26%    
Accretion of discount on PCI loans   400   0.01%    1,824   0.07%    
Accretion of time deposits premium   2,343   0.08%    4,488   0.16%    
Amortization of subordinated debentures discount   (185)  -0.01%    (125)  -     
Net impact   5,954   0.19%    13,513   0.49%    
As reported, on a fully taxable equivalent basis (1)$  119,664    3.95% $  110,622    3.89%    
            
(1) Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.      
       

For the third quarter of 2016, Hanmi recorded a negative provision for loan losses of $1.5 million, compared with a negative $3.7 million for the third quarter last year. For the first nine months of 2016 and 2015, the negative loan loss provision was $4.5 million and $7.8 million, respectively.

Third quarter noninterest income decreased $0.7 million, or 7.5%, to $8.7 million from $9.4 million for the second quarter of 2016 primarily due to a $1.2 million decrease in disposition gains on PCI loans and a $0.2 million decrease in gain on sales of SBA loans, partially offset by a $1.0 million gain from the sale of a recently consolidated branch facility (recorded in other operating income). Disposition gains on PCI loans were $0.8 million for the third quarter of 2016, compared with $2.0 million for the prior quarter, and $4.3 million for the third quarter last year. PCI loans increased $0.5 million for the third quarter of 2016, while they declined $4.8 million for the second quarter of 2016 and decreased $8.7 million for the third quarter of 2015. Gains on sales of SBA loans were $1.6 million for the third quarter 2016, compared with $1.8 million for the second quarter of 2016 and $1.6 million for the year-ago period as the volume of SBA loans sold increased to $24.1 million from $20.2 million for the preceding quarter and $20.6 million for the same quarter last year. Other operating income, which included $1.0 million gain on the sale of a branch facility, was $2.3 million for the third quarter of 2016, compared with $1.7 million for the second quarter of 2016 and $1.1 million for the same quarter last year.

For the first nine months of 2016, noninterest income decreased $10.5 million, or 29.6%, to $25.0 million from $35.5 million for the same period last year primarily due to a $6.1 million reduction in gain on sale of securities, a $4.6 million decrease in disposition gains on PCI loans and a $0.6 million decrease in gain on sales of SBA loans. Sales of securities in the first nine months of 2016 were de minimis, while securities transactions resulted in gains of $6.1 million for the same period last year. Disposition gains on PCI loans were $3.4 million for the first nine months of 2016, compared with $8.0 million for the same period last year as PCI loans decreased $4.5 million for the first nine months of 2016 and declined $19.4 million for the same period last year. Gains on sales of SBA loans were $4.2 million for the first nine months of 2016, compared with $4.9 million for the first nine months of 2015 as the volume of SBA loans sold decreased to $56.7 million from $59.8 million for the same period last year.

Noninterest expense for the third quarter increased $0.5 million, or 1.7%, to $28.3 million from $27.9 million for the second quarter primarily due to a $1.4 million expense related to the finalization of prior year FDIC loss share claims, which was recorded in other operating expenses.  This was partially offset by lower professional fees.

Noninterest expense decreased $0.4 million, or 1.3%, from $28.7 million for the third quarter last year primarily due to lower occupancy and equipment expense, coupled with lower salaries and employee benefits expense related to the branch closure and consolidations completed in the third quarter last year, as well as lower professional fees.  This was partially offset by higher expenses related to the aforementioned FDIC loss share claims, which was recorded in other operating expense.

For the first nine months of 2016, noninterest expense decreased $4.9 million, or 5.6%, to $82.3 million from $87.1 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 57.47% for the first nine months of 2016 from 59.65% for the first nine months of 2015.

Hanmi recorded a provision for income taxes of $8.2 million for the third quarter of 2016, representing an effective tax rate of 38.6%, compared with $8.9 million or 38.5% for the preceding quarter and $10.6 million or 43.1% for the third quarter of 2015.  For the first nine months of 2016, Hanmi recorded a provision for income taxes of $23.3 million, representing an effective tax rate of 35.6%, compared with $27.7 million or 41.6% for the same period last year.

Financial Position
Total assets were $4.40 billion at September 30, 2016, a 0.9% decrease from $4.44 billion at June 30, 2016, and a 4.5% increase from $4.21 billion at September 30, 2015.  The year-over-year increase in total assets was primarily due to increases in loans receivable.

Loans receivable, before the allowance for loan losses, were $3.55 billion at September 30, 2016, up 3.0% from $3.45 billion at June 30, 2016, and up 16.7% from $3.05 billion at September 30, 2015. The increase in loans from the end of the 2015 third quarter reflects Hanmi’s strong loan production.  Loans held for sale, representing the guaranteed portion of SBA loans, were $6.4 million at September 30, 2016, compared with $12.8 million at the end of the 2016 second quarter and $4.9 million at the end of the 2015 third quarter. 

New loan production for the 2016 third quarter was $168.3 million, and outpaced $55.2 million of loan payoffs. Third quarter 2016 new loan production was comprised of $103.6 million of commercial real estate loans, $33.4 million of commercial and industrial loans, $29.9 million of SBA loans, and $1.4 million of consumer loans. For the 2016 second quarter, new loan production was $265.2 million while loan payoffs were $113.3 million. Loan purchases for the 2016 third quarter were $46.0 million, compared with $66.5 million in the second quarter of 2016. SBA loan sales for the 2016 third quarter were $24.1 million, compared with $20.2 million for the second quarter of 2016.

Deposits were $3.77 billion at the end of the 2016 third quarter, compared with $3.59 billion at the end of the preceding quarter and $3.52 billion at the end of the third quarter of 2015.  The cost of deposits was 0.47% for the third quarter of 2016 compared with 0.43% for the second quarter of 2016 and 0.44% for the third quarter a year ago.

At September 30, 2016, stockholders’ equity was $531.2 million, compared with $525.2 million and $485.4 million at June 30, 2016 and September 30, 2015, respectively.  Tangible common stockholders’ equity was $529.7 million, or 12.04% of tangible assets, compared with $523.6 million, or 11.79% of tangible assets, and $483.7 million, or 11.48%, of tangible assets at June 30, 2016 and September 30, 2015, respectively.  Tangible book value per share was $16.42, up 1.2% from the preceding quarter and 8.6% from a year ago.   

During the third quarter, Hanmi declared a cash dividend on its common stock of $0.19 per share, up 36% from the prior quarter and up 73% from a year ago.  The dividend was paid on August 23, 2016, to stockholders of record as of the close of business on August 8, 2016. 

Asset Quality
Nonperforming loans, excluding PCI loans, were $10.9 million or 0.31% of loans at the end of the third quarter of 2016, compared with $12.3 million or 0.36% of loans at the end of the second quarter of 2016 and $23.9 million, or 0.79% of loans at the end of the third quarter last year.

OREO was $11.0 million at the end of the third quarter of 2016, down from $11.8 million at the end of the prior quarter. Classified loans were $36.9 million, or 1.04% of loans, at September 30, 2016, compared with $27.4 million, or 0.79% of loans, at June 30, 2016, and $40.0 million, or 1.31% of loans, a year ago.  Nonperforming assets were $21.9 million at the end of the third quarter of 2016, or 0.50% of assets, compared with 0.54% of assets at the end of the prior quarter and 0.88% of assets at the end of the same quarter last year.

Gross charge-offs for the third quarter of 2016 were $115,000, compared with $798,000 for the preceding quarter and $1.8 million for the same period a year ago. Recoveries of previously charged-off loans for the third quarter of 2016 were $830,000, compared with $995,000 for the preceding quarter and $994,000 for the third quarter of 2015. As a result, there were net recoveries of $715,000 for the third quarter of 2016, compared to net recoveries of $197,000 for the preceding quarter and net charge-offs of $752,000 for the year ago period. 

The allowance for loan losses was $39.0 million as of September 30, 2016, generating an allowance of loan losses to loans receivable ratio of 1.10% compared with 1.15% as of June 30, 2016 and 1.52% as of September 30, 2015.  

Conference Call       
Management will host a conference call today, October 18, 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 41 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)

 September 30, June 30, Percentage September 30, Percentage
  2016   2016  Change  2015  Change
Assets         
Cash and due from banks$  130,197  $  156,632   -16.9% $  235,342   -44.7%
Securities available for sale, at fair value   548,961     636,275   -13.7%    669,340   -18.0%
Loans held for sale, at the lower of cost or fair value   6,425     12,833   -49.9%    4,871   31.9%
Loans receivable, net of allowance for loan losses   3,513,687     3,409,603   3.1%    2,998,712   17.2%
Accrued interest receivable   10,160     10,552   -3.7%    8,722   16.5%
Premises and equipment, net   27,682     29,752   -7.0%    29,857   -7.3%
Other real estate owned ("OREO"), net   10,971     11,846   -7.4%    13,249   -17.2%
Customers' liability on acceptances   1,041     2,456   -57.6%    2,704   -61.5%
Servicing assets   10,833     11,337   -4.4%    11,986   -9.6%
Other intangible assets, net   1,456     1,537   -5.3%    1,795   -18.9%
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   -100.0%    14,098   -100.0%
Income tax asset   50,145     52,161   -3.9%    70,847   -29.2%
Bank-owned life insurance   49,149     48,851   0.6%    48,067   2.3%
Prepaid expenses and other assets   25,088     26,690   -6.0%    88,266   -71.6%
Total assets$  4,402,180   $  4,441,333    -0.9% $  4,214,241    4.5%
          
Liabilities and Stockholders' Equity         
Liabilities:         
Deposits:         
Noninterest-bearing$  1,231,967  $  1,189,528   3.6% $  1,114,621   10.5%
Interest-bearing   2,539,240     2,399,761   5.8%    2,404,073   5.6%
Total deposits   3,771,207     3,589,289   5.1%    3,518,694   7.2%
Accrued interest payable   2,444     3,107   -21.3%    2,985   -18.1%
Bank's liability on acceptances   1,041     2,456   -57.6%    2,704   -61.5%
FHLB advances   55,000     280,000   -80.4%    150,000   -63.3%
Servicing liabilities   3,426     3,921   -12.6%    5,176   -33.8%
FDIC loss sharing liability   1,701     18   9350.0%    1,173   45.0%
Subordinated debentures   18,888     18,821   0.4%    18,669   1.2%
Accrued expenses and other liabilities   17,275     18,536   -6.8%    29,391   -41.2%
Total liabilities   3,870,982      3,916,148    -1.2%    3,728,792    3.8%
          
Stockholders' equity:         
Common stock   33     33   0.0%    257   -87.2%
Additional paid-in capital   560,906     560,089   0.1%    557,116   0.7%
Accumulated other comprehensive income   7,555     9,121   -17.2%    2,158   250.1%
Retained earnings (accumulated deficit)   33,413     26,396   26.6%    (3,931)  -950.0%
Less treasury stock   (70,709)    (70,454)  0.4%    (70,151)  0.8%
Total stockholders' equity   531,198      525,185    1.1%    485,449    9.4%
Total liabilities and stockholders' equity$  4,402,180   $  4,441,333    -0.9% $  4,214,241    4.5%
                    

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

  Three Months Ended
 September 30, June 30, Percentage September 30, Percentage
  2016   2016  Change  2015  Change
Interest and dividend income:         
Interest and fees on loans$  41,150  $  40,645   1.2% $  36,466   12.8%
Interest on securities   2,701     2,886   -6.4%    2,884   -6.3%
Dividends on FRB and FHLB stock   419     579   -27.6%    607   -31.0%
Interest on deposits in other banks   55     49   12.2%    68   -19.1%
Total interest and dividend income   44,325     44,159   0.4%    40,025   10.7%
Interest expense:         
Interest on deposits   4,358     3,684   18.3%    3,881   12.3%
Interest on subordinated debentures   206     196   5.1%    158   30.4%
Interest on FHLB advances   179     299   -40.1%    1   0.0%
Total interest expense   4,743     4,179   13.5%    4,040   17.4%
Net interest income before provision for loan losses   39,582     39,980   -1.0%    35,985   10.0%
Negative provision for loan losses   (1,450)    (1,515)  -4.3%    (3,704)  -60.9%
Net interest income after provision for loan losses   41,032     41,495   -1.1%    39,689   3.4%
Noninterest income:         
Service charges on deposit accounts   2,883     2,898   -0.5%    3,378   -14.7%
Trade finance and other service charges and fees   992     1,064   -6.8%    1,115   -11.0%
Gain on sale of Small Business Administration ("SBA") loans   1,616     1,774   -8.9%    1,621   -0.3%
Disposition gains on Purchased Credit Impaired ("PCI") loans   789     1,963   -59.8%    4,334   -81.8%
Net gain on sales of securities   46     -   -     2,048   -97.8%
Other operating income   2,348     1,674   40.3%    1,065   120.5%
Total noninterest income   8,674     9,373   -7.5%    13,561   -36.0%
Noninterest expense:         
Salaries and employee benefits   15,950     16,061   -0.7%    16,097   -0.9%
Occupancy and equipment   3,917     3,938   -0.5%    4,896   -20.0%
Data processing   1,330     1,454   -8.5%    1,418   -6.2%
Professional fees   1,090     1,509   -27.8%    1,940   -43.8%
Supplies and communications   821     709   15.8%    880   -6.7%
Advertising and promotion   1,153     1,094   5.4%    1,290   -10.6%
OREO expense   73     183   -60.1%    225   -67.6%
Other operating expenses   4,003     2,915   37.3%    1,976   102.6%
Total noninterest expense   28,337     27,863   1.7%    28,722   -1.3%
Income before provision for income taxes   21,369     23,005   -7.1%    24,528   -12.9%
Income tax expense   8,248     8,857   -6.9%    10,569   -22.0%
Net income$  13,121   $  14,148    -7.3% $  13,959    -6.0%
            
Basic earnings per share:$  0.41  $  0.44    $  0.44   
Diluted earnings per share:$  0.41  $  0.44    $  0.44   
          
Weighted-average shares outstanding:         
Basic   31,912,470     31,882,489       31,799,573   
Diluted   32,088,233     32,029,910       31,909,808   
Common shares outstanding   32,252,774     32,260,320       31,977,207   
                

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

  Nine Months Ended
 September 30, September 30, Percentage
  2016   2015  Change
Interest and dividend income:     
Interest and fees on loans$  120,862  $  110,415   9.5%
Interest on securities   8,604     9,737   -11.6%
Dividends on FRB and FHLB stock   1,540     2,205   -30.2%
Interest on deposits in other banks   152     156   -2.6%
Total interest and dividend income   131,158     122,513   7.1%
Interest expense:     
Interest on deposits   11,769     11,463   2.7%
Interest on FHLB advances   673     61   1003.3%
Interest on subordinated debentures   584     454   28.6%
Total interest expense   13,026     11,978   8.7%
Net interest income before provision for loan losses   118,132     110,535   6.9%
Negative provision for loan losses   (4,490)    (7,779)  -42.3%
Net interest income after provision for loan losses   122,622     118,314   3.6%
Noninterest income:     
Service charges on deposit accounts   8,782     9,758   -10.0%
Trade finance and other service charges and fees   3,099     3,491   -11.2%
Gain on sale of Small Business Administration ("SBA") loans   4,247     4,878   -12.9%
Net gain on sales of securities   46     6,144   -99.3%
Disposition gains on Purchased Credit Impaired ("PCI") loans   3,411     8,027   -57.5%
Other operating income   5,423     3,246   67.1%
Total noninterest income   25,008     35,544   -29.6%
Noninterest expense:     
Salaries and employee benefits   47,710     48,023   -0.7%
Occupancy and equipment   11,351     13,423   -15.4%
Data processing   4,219     4,885   -13.6%
Professional fees   4,063     5,982   -32.1%
Supplies and communications   2,266     2,638   -14.1%
Advertising and promotion   2,769     2,859   -3.1%
OREO expense   721     629   14.6%
Other operating expenses   9,170     6,953   31.9%
Merger and integration costs   -     1,747   -100.0%
Total noninterest expense   82,269     87,139   -5.6%
Income before provision for income taxes   65,361     66,719   -2.0%
Income tax expense   23,288     27,722   -16.0%
Net income$  42,073   $  38,997    7.9%
        
Basic earnings per share:$  1.31  $  1.22   
Diluted earnings per share:$  1.31  $  1.22   
      
Weighted-average shares outstanding:     
Basic   31,880,466     31,774,047   
Diluted   32,031,295     31,855,024   
Common shares outstanding   32,252,774     31,977,207   
          

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 Nine Months Ended
 September 30, June 30, September 30, September 30, September 30,
  2016   2016   2015   2016   2015 
Average balances:         
Loans (1) $  3,477,280  $  3,328,416  $  2,895,336  $  3,333,369  $  2,851,895 
Securities   589,832     657,756     721,472     643,125     834,862 
Interest-earning assets   4,129,997     4,055,578     3,755,740     4,045,430     3,801,057 
Assets   4,397,555     4,325,500     4,021,642     4,315,012     4,074,537 
Deposits   3,669,419     3,479,365     3,484,648     3,544,389     3,498,393 
Borrowings   171,779     296,858     20,541     222,889     63,909 
Interest-bearing liabilities   2,651,505     2,605,737     2,433,703     2,600,851     2,513,660 
Stockholders’ equity   528,581     518,015     479,478     515,403     471,218 
Tangible equity (2)   527,072     516,424     477,620     513,813     469,267 
          
Performance ratios:         
Pre-tax, pre-provision earnings on average assets (3)  1.80%  2.00%  2.05%  1.88%  1.93%
Return on average assets (3)  1.19%  1.32%  1.38%  1.30%  1.28%
Return on average stockholders’ equity (3)  9.88%  10.98%  11.55%  10.90%  11.06%
Return on average tangible equity (3) 9.90%  11.02%  11.60%  10.94%  11.11%
Efficiency ratio 58.72%  56.46%  57.97%  57.47%  59.65%
Efficiency ratio excluding merger and integration costs 58.72%  56.46%  57.97%  57.47%  58.46%
Net interest margin (3) (6) 3.86%  4.02%  3.81%  3.95%  3.89%
Net interest margin excluding acquisition accounting (3) (6) 3.75%  3.84%  3.49%  3.76%  3.40%
              
Allowance for loan losses:         
Balance at beginning of period$  39,707  $  41,026  $  50,820  $  42,935  $  52,666 
(Negative provision) provision for loan losses   (1,450)    (1,515)    (3,704)    (4,490)    (7,779)
Net (charge-offs) recoveries   715     196     (754)    527     1,475 
Balance at end of period$  38,972  $  39,707  $  46,362  $  38,972  $  46,362 
          
Asset quality ratios:         
Nonperforming Non-PCI loans to loans (4) 0.31%  0.36%  0.79%  0.31%  0.79%
Nonperforming assets to assets (4) 0.50%  0.54%  0.88%  0.50%  0.88%
Net loan charge-offs (recoveries) to average loans (3) -0.08%  -0.02%  0.10%  -0.02%  -0.07%
Allowance for loan losses to loans 1.10%  1.15%  1.52%  1.10%  1.52%
Allowance for loan losses to nonperforming Non-PCI loans (4) (5) 305.43%  277.60%  180.52%  305.43%  180.52%
          
Allowance for off-balance sheet items:         
Balance at beginning of period$  1,475  $  1,220  $  962  $  986  $  1,366 
Provision (negative provision) for loan losses   16     255     (406)    505     (810)
Balance at end of period$  1,491  $  1,475  $  556  $  1,491  $  556 
          
Nonperforming assets (4):         
Nonaccrual Non-PCI loans$  10,948  $  12,341  $  23,944     
Loans 90 days or more past due and still accruing   -     -     -     
Nonperforming Non-PCI loans   10,948     12,341     23,944     
OREO, net   10,971     11,846     13,249     
Nonperforming assets$  21,919  $  24,187  $  37,193     
          
Delinquent loans:         
Loans, 30 to 89 days past due and still accruing$  1,066  $  1,517  $  1,424     
Delinquent loans to loans 0.03%  0.04%  0.05%    
          
Acquired loans         
PCI loans, net of discounts$  15,540  $  15,020     25,145     
Allowance for loan losses on PCI loans$  5,533  $  5,448     3,138     
Non-PCI loans, net of discounts$  108,434  $  117,750     179,695     
Unamortized acquisition discounts on Non-PCI loans$  7,087  $  7,735     14,414     


(1)  Includes loans held for sale
(2)  Refer to "Non-GAAP Financial Measures" for further details.
(3)  Annualized
(4)  Excludes PCI loans
(5)  Excludes allowance for loan losses allocated to PCI loans
(6)  Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.
 

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

 September 30, June 30, September 30,
  2016   2016   2015 
Loan portfolio:     
Commercial real estate loans$  2,880,012  $  2,835,077  $  2,541,449 
Residential real estate loans   330,675     296,496     198,105 
Commercial and industrial loans   319,656     293,073     280,784 
Consumer loans   22,316     24,664     24,734 
Loans receivable   3,552,659     3,449,310     3,045,072 
Loans held for sale, at the lower of cost or fair value   6,425     12,833     4,871 
Total loans$  3,559,084  $  3,462,143  $  3,049,943 
      
Loan mix:     
Commercial real estate loans 80.9%  81.8%  83.3%
Residential real estate loans 9.3%  8.6%  6.5%
Commercial and industrial loans 9.0%  8.5%  9.2%
Consumer loans 0.6%  0.7%  0.8%
Loans held for sale, at the lower of cost or fair value 0.2%  0.4%  0.2%
Total loans 100.0%  100.0%  100.0%
      
Deposit portfolio:     
Demand: noninterest-bearing$  1,231,967  $  1,189,528  $  1,114,621 
interest-bearing   94,272     92,776     87,871 
Money market and savings   1,242,502     1,023,421     871,869 
Time deposits of $250,000 or less   819,471     891,197     1,068,864 
Time deposits of more than $250,000   382,995     392,367     375,469 
Total deposits$  3,771,207  $  3,589,289  $  3,518,694 
      
Deposit mix:     
Demand: noninterest-bearing 32.7%  33.1%  31.7%
interest-bearing 2.5%  2.6%  2.5%
Money market and savings 32.9%  28.5%  24.8%
Time deposits of $250,000 or less 21.7%  24.8%  30.3%
Time deposits of more than $250,000 10.2%  11.0%  10.7%
Total deposits 100.0%  100.0%  100.0%
      
Capital ratios (7):     
Hanmi Financial     
Total risk-based capital 14.97%  15.16%  14.80%
Tier 1 risk-based capital 13.84%  14.00%  13.54%
Common equity tier 1 capital 13.69%  13.85%  13.54%
Tier 1 leverage capital ratio 11.68%  11.69%  11.19%
Hanmi Bank     
Total risk-based capital 14.59%  14.58%  14.74%
Tier 1 risk-based capital 13.46%  13.43%  13.48%
Common equity tier 1 capital 13.46%  13.43%  13.48%
Tier 1 leverage capital ratio 11.36%  11.21%  11.14%
 
(7) Preliminary ratios for September 30, 2016
 

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

 Three Months Ended
 September 30, 2016 June 30, 2016 September 30, 2015
  InterestAverage  InterestAverage  InterestAverage
 AverageIncome /Yield / AverageIncome /Yield / AverageIncome /Yield /
 BalanceExpenseRate BalanceExpenseRate BalanceExpenseRate
Assets           
Interest-earning assets:           
Loans (1)$  3,477,280 $  41,150  4.71% $  3,328,416 $  40,645  4.91% $  2,895,336 $  36,466  5.00%
Securities (2)   589,832    3,210  2.18%    657,756    3,397  2.07%    721,472    2,950  1.64%
FRB and FHLB stock   19,207    419  8.73%    30,808    579  7.52%    29,916    607  8.12%
Interest-bearing deposits in other banks   43,678    55  0.50%    38,598    49  0.51%    109,016    68  0.25%
Total interest-earning assets   4,129,997    44,834  4.32%    4,055,578    44,670  4.43%    3,755,740    40,091  4.23%
            
Noninterest-earning assets:           
Cash and due from banks   116,779       114,247       89,241   
Allowance for loan losses   (40,214)      (41,483)      (50,416)  
Other assets   190,993       197,158       227,077   
Total noninterest-earning assets   267,558       269,922       265,902   
            
Total assets$  4,397,555     $  4,325,500     $  4,021,642    
            
Liabilities and Stockholders' Equity           
Interest-bearing liabilities:           
Deposits:           
Demand: interest-bearing$  93,852 $  19  0.08% $  96,397 $  19  0.08% $  91,111 $  31  0.13%
Money market and savings   1,141,747    1,834  0.64%    944,355    1,212  0.52%    860,595    1,112  0.51%
Time deposits   1,244,127    2,505  0.80%    1,268,127    2,453  0.78%    1,461,456    2,738  0.74%
FHLB advances   152,935    179  0.47%    278,077    299  0.43%    1,902    1  0.21%
Subordinated debentures   18,844    206  4.35%    18,781    196  4.20%    18,639    158  3.36%
Total interest-bearing liabilities   2,651,505    4,743  0.71%    2,605,737    4,179  0.64%    2,433,703    4,040  0.66%
            
Noninterest-bearing liabilities:           
Demand deposits: noninterest-bearing   1,189,693       1,170,486       1,071,486   
Other liabilities   27,924       31,262       36,960   
Total noninterest-bearing liabilities   1,217,617       1,201,748       1,108,446   
            
Total liabilities   3,869,122       3,807,485       3,542,149   
Stockholders' equity   528,581       518,015       479,478   
            
Total liabilities and stockholders' equity$  4,397,703     $  4,325,500     $  4,021,627    
            
Net interest income $  40,091     $  40,491     $  36,051   
            
Cost of deposits   0.47%    0.43%    0.44%
Net interest spread   3.61%    3.79%    3.57%
Net interest margin   3.86%    4.02%    3.81%
            
(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)

 Nine Months Ended
 September 30, 2016 September 30, 2015
  InterestAverage  InterestAverage
 AverageIncome /Yield / AverageIncome /Yield /
 BalanceExpenseRate BalanceExpenseRate
Assets       
Interest-earning assets:       
Loans (1)$  3,333,369 $  120,862  4.84% $  2,851,895 $  110,415  5.18%
Securities (2)   643,125    10,136  1.58%    834,862    9,824  1.18%
FRB and FHLB stock   26,809    1,540  5.74%    29,903    2,205  7.37%
Interest-bearing deposits in other banks   42,127    152  0.48%    84,397    156  0.25%
Total interest-earning assets   4,045,430    132,690  4.38%    3,801,057    122,600  4.31%
        
Noninterest-earning assets:       
Cash and due from banks   115,235       88,313   
Allowance for loan losses   (41,401)      (52,287)  
Other assets   195,748       237,454   
Total noninterest-earning assets   269,582       273,480   
        
Total assets$  4,315,012     $  4,074,537    
        
Liabilities and Stockholders' Equity       
Interest-bearing liabilities:       
Deposits:       
Demand: interest-bearing$  95,264 $  56  0.08% $  89,286 $  89  0.13%
Money market and savings   996,578    4,130  0.55%    834,418    3,087  0.49%
Time deposits   1,286,120    7,583  0.79%    1,526,047    8,287  0.73%
FHLB advances   204,106    673  0.44%    45,311    61  0.18%
Subordinated debentures   18,783    584  4.15%    18,598    454  3.26%
Total interest-bearing liabilities   2,600,851    13,026  0.67%    2,513,660    11,978  0.64%
        
Noninterest-bearing liabilities:       
Demand deposits: noninterest-bearing   1,166,427       1,048,642   
Other liabilities   32,381       40,818   
Total noninterest-bearing liabilities   1,198,808       1,089,460   
        
Total liabilities   3,799,659       3,603,120   
Stockholders' equity   515,403       471,218   
        
Total liabilities and stockholders' equity$  4,315,062     $  4,074,338    
        
Net interest income $  119,664     $  110,622   
        
Cost of deposits   0.44%    0.44%
Net interest spread   3.71%    3.67%
Net interest margin   3.95%    3.89%
        
(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) 

 September 30, June 30, September 30,
Hanmi Financial Corporation 2016   2016   2015 
Assets$  4,402,180  $  4,441,333  $  4,214,241 
Less other intangible assets   (1,456)    (1,537)    (1,795)
Tangible assets$  4,400,724  $  4,439,796  $  4,212,446 
      
Stockholders' equity$  531,198  $  525,185  $  485,449 
Less other intangible assets   (1,456)    (1,537)    (1,795)
Tangible stockholders' equity$  529,742  $  523,648  $  483,654 
      
Stockholders' equity to assets 12.07%  11.82%  11.52%
Tangible common equity to tangible assets 12.04%  11.79%  11.48%
      
Common shares outstanding   32,252,774     32,260,320     31,977,207 
Tangible common equity per common share$  16.42  $  16.23  $  15.12 

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

Lasse Glassen
Investor Relations
Addo Investor Relations
310-829-5400