EXHIBIT 99.1

Hanmi Reports Strong Loan Production and 4.9% Increase in Net Income for Second Quarter 2017

2017 Second Quarter Highlights:    

LOS ANGELES, July 18, 2017 (GLOBE NEWSWIRE) -- Hanmi Financial Corporation (NASDAQ:HAFC) (or “Hanmi”), the parent company of Hanmi Bank (the “Bank”) today reported net income for the 2017 second quarter of $14.5 million or $0.45 per diluted share, compared with $13.8 million, or $0.43 per diluted share for the 2017 first quarter and $14.1 million, or $0.44 per diluted share for the 2016 second quarter.

For the first six months of 2017, net income decreased 2.5% to $28.2 million, or $0.87 per diluted share, compared with $29.0 million, or $0.90 per diluted share, for the first six months of 2016.

Mr. C. G. Kum, President and Chief Executive Officer, said, “Hanmi’s second quarter performance continues to reflect our ability to generate relatively high loan growth while preserving conservative underwriting discipline.  During the second quarter, we were able to generate net loan growth of 3.3% with weighted average loan-to-value of 59% and debt-coverage-ratio of 2.0 times for new commercial real estate loans.  Our asset quality metrics remain favorable with non-performing assets at 42 basis points of total assets and negligible net charge-off levels.  I am pleased to note that Hanmi’s net profits for the second quarter resulted in, once again, favorable return on average assets of 1.19% and return on average equity of 10.65%.”

Quarterly Highlights              
 (in thousands, except per share data)               
               
  For the Three Months Ended  Amount Change 
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17 
  2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16 
               
Net income$14,457  $13,783  $14,416  $13,121  $14,148  $674 $309 
Net income per diluted common share$0.45  $0.43  $0.45  $0.41  $0.44  $0.02 $0.01 
               
Assets$4,973,346  $4,811,821  $4,701,346  $4,402,180  $4,441,333  $161,525 $532,013 
Loans and leases receivable$4,073,062  $3,943,951  $3,844,769  $3,552,659  $3,449,310  $129,111 $623,752 
Deposits$4,259,173  $4,083,165  $3,809,737  $3,771,207  $3,589,289  $176,008 $669,884 
               
Return on average assets 1.19%  1.18%  1.26%  1.19%  1.32%  0.01  -0.13 
Return on average stockholders' equity 10.65%  10.46%  10.84%  9.88%  10.98%  0.19  -0.33 
               
Net interest margin (1) 3.81%  3.89%  3.96%  3.86%  4.02%  -0.08  -0.21 
Net interest margin excluding acquisition accounting (1) 3.76%  3.84%  3.86%  3.75%  3.84%  -0.08  -0.08 
Efficiency ratio (3) 54.74%  54.95%  51.77%  58.72%  56.46%  -0.22  -1.72 
Efficiency ratio excluding merger and integration costs 54.75%  55.01%  51.15%  58.72%  56.46%  -0.26  -1.70 
               
Tangible common equity to tangible assets (2) 10.83%  10.98%  11.05%  12.04%  11.79%  -0.14  -0.96 
Tangible common equity per common share (2)$16.59  $16.26  $16.03  $16.42  $16.23  $0.33 $0.36 
               
(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.             
(3)  Noninterest expense divided by net interest income plus noninterest income             
               

Results of Operations 
Second quarter net interest income increased 1.9% to $43.2 million from $42.4 million in the first quarter primarily from the solid expansion of loans and leases receivable, partially offset by an increase in deposit and subordinated debt interest expense. Average time deposits increased 12.5% and the average subordinated debt balance increased 277.5%.

  As of or For the Three Months Ended (in thousands)  Percentage Change
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
Net Interest Income 2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
              
Interest and fees on loans and leases(1)$47,971  $45,378  $43,780  $41,150  $40,645   5.7%  18.0%
Interest on securities 2,949   2,520   2,550   2,701   2,886   17.0%  2.2%
Dividends on FRB and FHLB stock 283   374   927   419   579   -24.3%  -51.1%
Interest on deposits in other banks 123   77   55   55   49   59.7%  151.0%
Total interest and dividend income$51,326  $48,349  $47,312  $44,325  $44,159   6.2%  16.2%
              
Interest on deposits 6,463   5,154   4,799   4,358   3,684   25.4%  75.4%
Interest on borrowings 49   468   207   179   299   -89.5%  -83.6%
Interest on subordinated debentures 1,636   373   241   206   196   338.6%  734.7%
Total interest expense 8,148   5,995   5,247   4,743   4,179   35.9%  95.0%
Net interest income$43,178  $42,354  $42,065  $39,582  $39,980   1.9%  8.0%
              
(1)  Includes loans held for sale.             
              

Net interest margin (on a taxable equivalent basis) for the second quarter of 2017 was 3.81% compared with 3.89% for the first quarter of 2017. The 8 basis point decrease in net interest margin for the recent quarter compared with the preceding quarter was primarily due to the full quarter impact of the first quarter’s subordinated debt issuance - approximately 11 basis points.  The yield on average interest-earning assets increased 8 basis points to 4.52% in the first quarter while the rate paid on average interest-bearing deposits increased 9 basis points to 0.88%.

  For the Three Months Ended (in thousands)  Percentage Change
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
Average Earning Assets and Interest-bearing Liabilities 2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Loans (1)$3,951,934  $3,881,686  $3,690,955  $3,477,428  $3,328,416   1.8%  18.7%
Securities 585,384   526,549   530,241   589,832   657,756   11.2%  -11.0%
FRB and FHLB stock 16,385   16,385   16,385   19,207   30,808   0.0%  -46.8%
Interest-bearing deposits in other banks 47,402   38,600   40,548   43,678   38,598   22.8%  22.8%
Average interest-earning assets$4,601,105  $4,463,220  $4,278,129  $4,130,145  $4,055,578   3.1%  13.5%
              
Demand: interest-bearing$93,873  $97,602  $95,399  $93,852  $96,397   -3.8%  -2.6%
Money market and savings 1,532,733   1,406,903   1,305,565   1,141,747   944,355   8.9%  62.3%
Time deposits 1,320,005   1,173,184   1,165,828   1,244,127   1,268,127   12.5%  4.1%
Average interest-bearing deposits 2,946,611   2,677,689   2,566,792   2,479,726   2,308,879   10.0%  27.6%
Borrowings 20,000   270,500   174,674   152,935   278,077   -92.6%  -92.8%
Subordinated debentures 116,850   30,950   18,919   18,844   18,781   277.5%  522.2%
Average interest-bearing liabilities$3,083,461  $2,979,139  $2,760,385  $2,651,505  $2,605,737   3.5%  18.3%
              
(1)  Includes loans held for sale.             
              
  For the Three Months Ended  Percentage Change
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
Average Yields and Rates 2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Loans (1) 4.87%  4.74%  4.72%  4.71%  4.91%  2.7%  -0.8%
Securities (2) 2.35%  2.30%  2.31%  2.18%  2.07%  2.2%  13.8%
FRB and FHLB stock 6.93%  9.26%  22.63%  8.73%  7.52%  -25.2%  -7.8%
Interest-bearing deposits in other banks 1.04%  0.81%  0.54%  0.50%  0.51%  28.4%  103.7%
Interest-earning assets 4.52%  4.44%  4.45%  4.32%  4.43%  1.8%  2.0%
              
Interest-bearing deposits 0.88%  0.78%  0.74%  0.70%  0.64%  12.8%  36.6%
Borrowings 0.98%  0.70%  0.47%  0.47%  0.43%  40.0%  126.6%
Subordinated debentures 5.59%  4.82%  5.07%  4.35%  4.20%  16.0%  33.1%
Interest-bearing liabilities 1.06%  0.82%  0.76%  0.71%  0.65%  29.3%  64.3%
              
Net interest margin (taxable equivalent basis) 3.81%  3.89%  3.96%  3.86%  4.02%  -2.1%  -5.1%
              
Cost of deposits 0.62%  0.54%  0.50%  0.47%  0.43%  14.8%  44.2%
              
(1)  Includes loans held for sale.             
(2)  Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.        
              

For the second quarter of 2017, Hanmi recorded a provision for loan losses of $0.4 million, which included a negative loan loss provision of $0.2 million relating to Purchased Credit Impaired (“PCI”) loans from the 2014 acquisition. For the prior quarter, the negative loan loss provision was $0.1 million, all of which related to PCI loans.

Second quarter noninterest income increased $2.5 million or 34.4% to $9.7 million from $7.2 million for the first quarter of 2017 primarily due to a $1.2 million increase in gains on sale of SBA loans, a $0.7 million increase in gains on sales of securities and a $0.4 million increase in disposition gain on PCI loans. Gains on sales of SBA loans were $2.7 million for the second quarter 2017, up from $1.5 million from the first quarter of 2017 as the volume of SBA loans sold increased to $32.4 million from $19.6 million for the preceding quarter. Gains on the sales of securities were $0.9 million for the second quarter of 2017, up from $0.3 million in the first. Disposition gains on PCI loans were $0.5 million for the second quarter of 2017, compared with $0.2 million for the prior quarter. PCI loans from the 2014 acquisition were $8.8 million at the end of the second quarter of 2017, down 2.0% from the prior quarter.

  For the Three Months Ended (in thousands)  Percentage Change
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
Noninterest Income 2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Service charges on deposit accounts$2,461  $2,528  $2,599  $2,883  $2,898   -2.7%  -15.1%
Trade finance and other service charges and fees 1,269   1,047   1,132   992   1,064   21.2%  19.3%
Other operating income 1,826   1,726   991   2,348   1,674   5.8%  9.1%
Service charges, fees & other 5,556   5,301   4,722   6,223   5,636   4.8%  -1.4%
              
Gain on sale of SBA loans 2,668   1,464   1,787   1,616   1,774   82.2%  50.4%
Disposition gain on PCI loans 540   183   1,559   789   1,963   195.1%  -72.5%
Net gain on sales of securities 938   269   -   46   -   248.7%  0.0%
Total noninterest income$9,702  $7,217  $8,068  $8,674  $9,373   34.4%  3.5%
              

Noninterest expense for the second quarter increased $1.7 million, or 6.3%, to $28.9 million from $27.2 million for the first quarter primarily due to a $0.8 million increase in other operating expenses and a $0.6 million increase in OREO expense. Excluding OREO expense, which increased $0.6 million, and merger and integration costs, noninterest expense increased $1.1 million or 3.9% quarter over quarter.  Although salaries and benefits declined $0.5 million or 2.8% from the seasonal decline of payroll taxes and employee benefits, advertising and promotion was seasonally higher increasing $0.2 million while professional fees increased $0.4 million on higher audit and tax fees.  Other expense increased $0.8 million due to the first quarter benefit from a $0.5 million reduction in our SBA servicing valuation allowance and a second quarter loss of $0.1 million on the sale of branch properties.  As a result of the increase in revenue from the growth in earning assets and the gains on sale of SBA loans and securities, the efficiency ratio improved to 54.7% in the second quarter from 55.0% in the prior quarter.

  For the Three Months Ended (in thousands)  Percentage Change
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
  2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Noninterest Expense             
Salaries and benefits$16,623  $17,104  $16,246  $15,950  $16,061   -2.8%  3.5%
Occupancy and equipment 3,878   3,982   3,641   3,917   3,938   -2.6%  -1.5%
Data processing 1,738   1,631   1,455   1,330   1,454   6.6%  19.5%
Professional fees 1,554   1,148   1,311   1,090   1,509   35.4%  3.0%
Supplies and communication 745   635   683   821   709   17.3%  5.1%
Advertising and promotion 1,015   802   1,140   1,153   1,094   26.6%  -7.2%
Other operating expenses 2,881   2,070   1,825   4,003   2,915   39.2%  -1.2%
subtotal 28,434   27,372   26,301   28,264   27,680   3.9%  2.7%
              
OREO expense (income) 519   (101)  (658)  73   183   -613.9%  183.6%
Merger and integration costs (9)  (31)  312   -   -   -71.0%  0.0%
Total noninterest expense$28,944  $27,240  $25,955  $28,337  $27,863   6.3%  3.9%
              

Hanmi recorded a provision for income taxes of $9.1 million for the second quarter of 2017, representing an effective tax rate of 38.5%, compared with $8.6 million, representing an effective tax rate of 38.5%, for the preceding quarter.

Financial Position
Total assets were $4.97 billion at June 30, 2017, a 3.4% increase from $4.81 billion at March 31, 2017. The increase in total assets was primarily due to an increase in loans and leases receivable.

Loans and leases receivable, before the allowance for loan and lease losses, were $4.07 billion at June 30, 2017, up 3.3% from $3.94 billion at March 31, 2017. The increase in loans and leases from the prior quarter reflects Hanmi’s strong loan production, up 37.6% to $279.0 million from $202.7 million for the first quarter of 2017. Loans held for sale, representing the guaranteed portion of SBA loans, were $10.9 million at June 30, 2017 compared with $8.8 million at the end of the 2017 first quarter.

Loans and leases receivable, before the allowance for loan and lease losses, increased 18.1% from $3.45 billion for the second quarter last year, primarily due to strong loan production over the last twelve months, as well as last year’s acquisition and commencement of the Commercial Equipment Leasing division.

  As of (in thousands)  Percentage Change
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
  2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Loan and Lease Portfolio             
Commercial real estate loans$3,068,069  $2,991,123  $2,939,608  $2,880,012  $2,835,076   2.6%  8.2%
Residential real estate loans 384,044   359,152   338,767   330,675   296,496   6.9%  29.5%
Commercial and industrial loans 346,150   316,284   300,220   319,656   293,073   9.4%  18.1%
Lease receivable 257,525   259,591   243,294   -   -   -0.8%  0.0%
Consumer loans 17,274   17,801   22,880   22,316   24,665   -3.0%  -30.0%
Loans and leases receivable 4,073,062   3,943,951   3,844,769   3,552,659   3,449,310   3.3%  18.1%
Loans held for sale 10,949   8,849   9,316   6,425   12,833   23.7%  -14.7%
Total loans$4,084,011  $3,952,800  $3,854,085  $3,559,084  $3,462,143   3.3%  18.0%
              
Acquired Loans(1)             
PCI loans, net of discounts$8,784  $8,960  $9,863  $15,540  $15,020   -2.0%  -41.5%
Non-PCI loans, net of discounts 96,600   101,062   104,733   108,434   117,750   -4.4%  -18.0%
Total acquired loans$105,384  $110,022  $114,596  $123,974  $132,770   -4.2%  -20.6%
              
(1)  Includes UCB acquired only.             
              

New loan production for the 2017 second quarter was $279.0 million while payoffs and amortization was $131.4 million compared with $202.7 million and $117.8 million for the first quarter of 2017. Second quarter 2017 new loan production was comprised of $137.7 million of commercial real estate loans, $58.9 million of commercial and industrial loans, $48.0 million of SBA loans, $33.1 million of commercial leases and $1.2 million of consumer loans. Loan purchases for the 2017 second quarter were $39.4 million, compared with $33.6 million in the first quarter of 2017.  For the second quarter of 2017, commercial real estate loans as a percentage of total loans and leases decreased to 75.3% compared with 82.2% for the same period last year.

Deposits increased to $4.26 billion at the end of the 2017 second quarter from $4.08 billion at the end of the preceding quarter. Time deposits led this growth increasing 14.0%.  The loans to deposits ratio at June 30, 2017 declined to 95.6% from 96.6% at March 31, 2017.

Deposits increased 18.7% from $3.59 billion in the second quarter last year, primarily due to the strength of Hanmi’s retail branch network as money market and savings balance increased 49.3% compared a year ago.

  As of (in thousands)  Percentage Change
  Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
  2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Deposit Portfolio             
Demand: noninterest-bearing$1,260,929  $1,241,272  $1,203,240  $1,231,967  $1,189,528   1.6%  6.0%
Demand: interest-bearing 93,390   99,433   96,856   94,272   92,776   -6.1%  0.7%
Money market and savings 1,528,127   1,534,578   1,329,324   1,242,502   1,023,421   -0.4%  49.3%
Time deposits of $250,000 or less 916,197   731,445   734,383   819,471   891,197   25.3%  2.8%
Time deposits of more than $250,000 460,530   476,437   445,934   382,995   392,367   -3.3%  17.4%
Total deposits$4,259,173  $4,083,165  $3,809,737  $3,771,207  $3,589,289   4.3%  18.7%
              

At June 30, 2017, stockholders’ equity was $550.1 million, compared with $539.5 million at March 31, 2017. Tangible common stockholders’ equity was $537.4 million, or 10.83% of tangible assets, compared with $526.7 million, or 10.98% of tangible assets at March 31, 2017. Tangible book value per share was $16.59, compared to $16.26 in the first quarter.

Hanmi continues to be well capitalized, with a preliminary Tier 1 risk-based capital ratio of 12.72% and a Total risk-based capital ratio of 15.87% at June 30, 2017, versus 12.93% and 16.16%, respectively, at March 31, 2017.

  As of  Amount Change
 Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
  2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Regulatory Capital ratios (1)             
Hanmi Financial             
Total risk-based capital 15.87%  16.16%  13.86%  14.99%  15.16%  -0.29   0.71 
Tier 1 risk-based capital 12.72%  12.93%  13.02%  13.89%  14.00%  -0.21   -1.28 
Common equity tier 1 capital 12.36%  12.56%  12.73%  13.73%  13.85%  -0.20   -1.49 
Tier 1 leverage capital ratio 11.08%  11.21%  11.53%  11.68%  11.69%  -0.13   -0.61 
Hanmi Bank             
Total risk-based capital 15.63%  15.91%  13.64%  14.61%  14.58%  -0.28   1.05 
Tier 1 risk-based capital 14.81%  15.07%  12.80%  13.50%  13.43%  -0.26   1.38 
Common equity tier 1 capital 14.81%  15.07%  12.80%  13.50%  13.43%  -0.26   1.38 
Tier 1 leverage capital ratio 12.90%  13.08%  11.33%  11.36%  11.21%  -0.18   1.69 
              
(1)  Preliminary ratios for June 30, 2017             
              

Hanmi declared a cash dividend of $0.19 per common share on its common stock in the 2017 second quarter, in line with the prior quarter. The dividend was paid on May 24, 2017, to stockholders of record as of the close of business on May 8, 2017.

Asset Quality
Nonperforming loans, excluding PCI loans, were $16.5 million at the end of the second quarter of 2017, or 0.41% of loans, compared with $12.8 million at the end of the first quarter of 2017, or 0.32% of loans.

OREO was $4.3 million at the end of the second quarter of 2017, down from $4.6 million at the end of the prior quarter. Nonperforming assets were $20.8 million at the end of the second quarter of 2017, or 0.42% of assets, compared with 0.36% of assets at the end of the prior quarter.

Gross charge-offs for the second quarter of 2017 were $665,000 compared with $186,000 for the preceding quarter. Recoveries of previously charged-off loans for the second quarter of 2017 were $849,000 compared with $989,000 for the preceding quarter. As a result, there were net recoveries of $184,000 for the second quarter of 2017, compared to net recoveries of $803,000 for the preceding quarter.

The allowance for loan and lease losses was $33.8 million as of June 30, 2017, generating an allowance of loan losses to loans receivable ratio of 0.83% compared with 0.84% as of March 31, 2017.

  As of or for the Three Months Ended (in thousands)  Amount Change
 June 30, Mar 31, Dec 31, Sep 30, Jun 30, Q2-17 Q2-17
  2017   2017   2016   2016   2016  vs. Q1-17 vs. Q2-16
Asset Quality             
Nonperforming assets (1):             
Nonaccrual Non-PCI loans$16,464  $12,774  $11,406  $10,948  $12,341  $3,690  $4,123 
Loans 90 days or more past due and still accruing -   -   -   -   -   -   - 
Nonperforming Non-PCI loans 16,464   12,774   11,406   10,948   12,341   3,690   4,123 
OREO, net 4,321   4,636   7,484   10,971   11,846   (315)  (7,525)
Nonperforming assets$20,785  $17,410  $18,890  $21,919  $24,187  $3,375  $(3,402)
              
Delinquent loans:             
Loans, 30 to 89 days past due and still accruing$9,431  $6,273  $5,718  $1,066  $1,517  $3,158  $7,914 
Delinquent loans to loans 0.23%  0.16%  0.15%  0.03%  0.04%  0.07   0.19 
              
Allowance for loan and lease losses:             
Balance at beginning of period$33,152  $32,429  $38,972  $39,707  $41,026     
Loan and lease loss provision (income) 422   (80)  151   (1,450)  (1,515)    
Net loan charge-offs (recoveries) (184)  (803)  6,694   (715)  (196)    
Balance at end of period$33,758  $33,152  $32,429  $38,972  $39,707     
              
Asset quality ratios:             
Nonperforming Non-PCI loans to loans (1) 0.41%  0.32%  0.30%  0.31%  0.36%    
Nonperforming assets to assets (1) 0.42%  0.36%  0.40%  0.50%  0.54%    
Net loan charge-offs (recoveries) to average loans (3) -0.02%  -0.08%  0.73%  -0.08%  -0.02%    
Allowance for loan losses to loans 0.83%  0.84%  0.84%  1.10%  1.15%    
Allowance for loan losses to nonperforming Non-PCI loans (1) (2) 200.67%  252.54%  275.80%  305.43%  277.60%    
              
Allowance for off-balance sheet items:             
Balance at beginning of period$1,184  $1,184  $1,491  $1,475  $1,220     
Provision (income) for off-balance sheet items (49)  -   (307)  16   255     
Balance at end of period$1,135  $1,184  $1,184  $1,491  $1,475     
              
(1)  Excludes PCI loans             
(2)  Excludes allowance for loan losses allocated to PCI loans            
(3)  Annualized             
              

Conference Call                             
Management will host a conference call today, July 18, 2017 at 2:00 p.m. PT (5:00 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 2:00 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 Corporation, 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 and lease losses; credit quality and the effect of credit quality on our provision for loan and lease losses and allowance for loan and lease 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, 2016, 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 
  2017   2017  Change  2016  Change 
Assets          
Cash and due from banks$138,507  $138,592  -0.1% $156,632  -11.6% 
Securities available for sale, at fair value 571,846   548,010  4.3%  636,275  -10.1% 
Loans held for sale, at the lower of cost or fair value 10,949   8,849  23.7%  12,833  -14.7% 
Loans and leases receivable, net of allowance for loan and lease losses 4,039,304   3,910,799  3.3%  3,409,603  18.5% 
Accrued interest receivable 11,167   10,774  3.6%  10,552  5.8% 
Customers' liability on acceptances 1,481   932  58.9%  2,456  -39.7% 
Servicing assets 10,480   10,609  -1.2%  11,337  -7.6% 
Premises and equipment, net 26,869   28,350  -5.2%  29,752  -9.7% 
Goodwill and other intangible assets, net 12,712   12,797  -0.7%  1,537  727.1% 
Federal Home Loan Bank ("FHLB") stock, at cost 16,385   16,385  0.0%  16,385  0.0% 
Federal Reserve Bank ("FRB") stock, at cost -   -  -   14,423  -100.0% 
Other real estate owned ("OREO"), net 4,321   4,636  -6.8%  11,846  -63.5% 
Income tax asset 50,286   40,049  25.6%  52,161  -3.6% 
Bank-owned life insurance 49,982   49,722  0.5%  48,851  2.3% 
Prepaid expenses and other assets 29,057   31,317  -7.2%  26,690  8.9% 
Total assets$   4,973,346   $   4,811,821   3.4% $   4,441,333   12.0% 
           
Liabilities and Stockholders' Equity          
Liabilities:          
Deposits:          
Noninterest-bearing$1,260,929  $1,241,272  1.6% $1,189,528  6.0% 
Interest-bearing 2,998,244   2,841,893  5.5%  2,399,761  24.9% 
Total deposits 4,259,173   4,083,165  4.3%  3,589,289  18.7% 
Accrued interest payable 3,432   2,619  31.0%  3,107  10.5% 
Bank's liability on acceptances 1,481   932  58.9%  2,456  -39.7% 
FHLB advances 20,000   50,000  -60.0%  280,000  -92.9% 
Subordinated debentures 117,011   116,795  0.2%  18,821  521.7% 
Accrued expenses and other liabilities 22,109   18,768  17.8%  22,475  -1.6% 
Total liabilities   4,423,206      4,272,279   3.5%    3,916,148   12.9% 
           
Stockholders' equity:          
Common stock 33   33  0.0%  33  0.0% 
Additional paid-in capital 563,948   563,151  0.1%  560,089  0.7% 
Accumulated other comprehensive income 137   (1,603) -108.5%  9,121  -98.5% 
Retained earnings 57,717   49,395  16.8%  26,396  118.7% 
Less treasury stock (71,695)  (71,434) 0.4%  (70,454) 1.8% 
Total stockholders' equity   550,140      539,542   2.0%    525,185   4.8% 
Total liabilities and stockholders' equity$   4,973,346   $   4,811,821   3.4% $   4,441,333   12.0% 
           


Hanmi Financial Corporation and Subsidiaries
Consolidated Statements of Income (Unaudited)
(In thousands, except share and per share data)
           
  Three Months Ended  
 June 30, March 31, Percentage June 30, Percentage 
  2017   2017  Change  2016  Change 
Interest and dividend income:          
Interest and fees on loans and leases$47,971  $45,378  5.7% $40,645  18.0% 
Interest on securities 2,949   2,520  17.0%  2,886  2.2% 
Dividends on FRB and FHLB stock 283   374  -24.3%  579  -51.1% 
Interest on deposits in other banks 123   77  59.7%  49  151.0% 
Total interest and dividend income 51,326   48,349  6.2%  44,159  16.2% 
Interest expense:          
Interest on deposits 6,463   5,154  25.4%  3,684  75.4% 
Interest on FHLB advances 49   468  -89.5%  299  -83.6% 
Interest on subordinated debentures 1,636   373  338.6%  196  734.7% 
Total interest expense 8,148   5,995  35.9%  4,179  95.0% 
Net interest income before provision for loan and lease losses 43,178   42,354  1.9%  39,980  8.0% 
Loan and lease loss provision (income) 422   (80) -627.5%  (1,515) -127.9% 
Net interest income after provision for loan and lease losses 42,756   42,434  0.8%  41,495  3.0% 
Noninterest income:          
Service charges on deposit accounts 2,461   2,528  -2.7%  2,898  -15.1% 
Trade finance and other service charges and fees 1,269   1,047  21.2%  1,064  19.3% 
Gain on sale of Small Business Administration ("SBA") loans 2,668   1,464  82.2%  1,774  50.4% 
Disposition gains on Purchased Credit Impaired ("PCI") loans 540   183  195.1%  1,963  -72.5% 
Net gain on sales of securities 938   269  248.7%  -  -  
Other operating income 1,826   1,726  5.8%  1,674  9.1% 
Total noninterest income 9,702   7,217  34.4%  9,373  3.5% 
Noninterest expense:          
Salaries and employee benefits 16,623   17,104  -2.8%  16,061  3.5% 
Occupancy and equipment 3,878   3,982  -2.6%  3,938  -1.5% 
Data processing 1,738   1,631  6.6%  1,454  19.5% 
Professional fees 1,554   1,148  35.4%  1,509  3.0% 
Supplies and communications 745   635  17.3%  709  5.1% 
Advertising and promotion 1,015   802  26.6%  1,094  -7.2% 
OREO expense (income) 519   (101) -613.9%  183  183.6% 
Merger and integration costs (9)  (31) -71.0%  -  -  
Other operating expenses 2,881   2,070  39.2%  2,915  -1.2% 
Total noninterest expense 28,944   27,240  6.3%  27,863  3.9% 
Income before provision for income taxes 23,514   22,411  4.9%  23,005  2.2% 
Income tax expense 9,057   8,628  5.0%  8,857  2.3% 
Net income$   14,457   $   13,783   4.9% $   14,148   2.2% 
            
Basic earnings per share:$0.45  $0.43    $0.44    
Diluted earnings per share:$0.45  $0.43    $0.44    
           
Weighted-average shares outstanding:          
Basic 32,078,038   32,001,766     31,882,489    
Diluted 32,243,034   32,191,458     32,029,910    
Common shares outstanding 32,393,856   32,392,580     32,260,320    
           
           
Hanmi Financial Corporation and Subsidiaries          
Consolidated Statements of Income (Unaudited)          
(In thousands, except share and per share data)          
  Six Months Ended      
 June 30, June 30, Percentage     
  2017   2016  Change     
Interest and dividend income:          
Interest and fees on loans and leases$93,349  $79,712  17.1%     
Interest on securities 5,468   5,903  -7.4%     
Dividends on FRB and FHLB stock 657   1,121  -41.4%     
Interest on deposits in other banks 200   97  106.2%     
Total interest and dividend income 99,674   86,833  14.8%     
Interest expense:          
Interest on deposits 11,617   7,410  56.8%     
Interest on FHLB advances 517   494  4.7%     
Interest on subordinated debentures 2,009   379  430.1%     
Interest on Other Borrowings -   -  -      
Total interest expense 14,143   8,283  70.7%     
Net interest income before provision for loan and leas losses 85,531   78,550  8.9%     
Loan and lease loss provision (income) 342   (3,040) -111.3%     
Net interest income after provision for loan and lease losses 85,189   81,590  4.4%     
Noninterest income:          
Service charges on deposit accounts 4,989   5,899  -15.4%     
Trade finance and other service charges and fees 2,316   2,109  9.8%     
Gain on sale of Small Business Administration ("SBA") loans 4,132   2,632  57.0%     
Net gain on sales of securities 1,206   -  -      
Disposition gains on Purchased Credit Impaired ("PCI") loans 723   2,622  -72.4%     
Other operating income 3,551   3,072  15.6%     
Total noninterest income 16,917   16,334  3.6%     
Noninterest expense:          
Salaries and employee benefits 33,727   31,759  6.2%     
Occupancy and equipment 7,861   7,434  5.7%     
Data processing 3,369   2,889  16.6%     
Professional fees 2,702   2,974  -9.1%     
Supplies and communications 1,379   1,445  -4.6%     
Advertising and promotion 1,817   1,616  12.4%     
OREO expense (income) 418   648  -35.5%     
Merger and integration costs (40)  -  -      
Other operating expenses 4,948   5,167  -4.2%     
Total noninterest expense 56,181   53,932  4.2%     
Income before provision for income taxes 45,925   43,992  4.4%     
Income tax expense 17,685   15,040  17.6%     
Net income$   28,240   $   28,952   -2.5%     
            
Basic earnings per share:$0.88  $0.90        
Diluted earnings per share$0.87  $0.90        
           
Weighted-average shares outstanding:          
Basic 32,040,113   31,864,427        
Diluted 32,216,671   32,001,163        
Common shares outstanding 32,393,856   32,260,320        
           


 

Hanmi Financial Corporation and Subsidiaries
Average Balance, Average Yield Earned, and Average Rate Paid (Unaudited)
(In thousands, except ratios)
             
 Three Months Ended 
 June 30, 2017 March 31, 2017 June 30, 2016 
  InterestAverage  InterestAverage  InterestAverage 
 AverageIncome /Yield / AverageIncome /Yield / AverageIncome /Yield / 
 BalanceExpenseRate BalanceExpenseRate BalanceExpenseRate 
Assets            
Interest-earning assets:            
Loans (1)$3,951,934 $47,9714.87% $3,881,686 $45,3784.74% $3,328,416 $40,6454.91% 
Securities (2) 585,384  3,4442.35%  526,549  3,0262.30%  657,756  3,3972.07% 
FRB and FHLB stock 16,385  2836.93%  16,385  3749.26%  30,808  5797.52% 
Interest-bearing deposits in other banks 47,402  1231.04%  38,600  770.81%  38,598  490.51% 
Total interest-earning assets 4,601,105  51,8214.52%  4,463,220  48,8554.44%  4,055,578  44,6704.43% 
             
Noninterest-earning assets:            
Cash and due from banks 116,750     117,802     114,247    
Allowance for loan losses (33,540)    (32,842)    (41,483)   
Other assets 191,158     190,041     197,158    
Total noninterest-earning assets 274,368     275,001     269,922    
             
Total assets$  4,875,473     $  4,738,221     $  4,325,500     
             
Liabilities and Stockholders' Equity            
Interest-bearing liabilities:            
Deposits:            
Demand: interest-bearing$93,873 $180.08% $97,602 $190.08% $96,397 $190.08% 
Money market and savings 1,532,733  3,2240.84%  1,406,903  2,6660.77%  944,355  1,2120.52% 
Time deposits 1,320,005  3,2210.98%  1,173,184  2,4690.85%  1,268,127  2,4530.78% 
Total interest-bearing deposits 2,946,611  6,4630.88%  2,677,689  5,1540.78%  2,308,879  3,6840.64% 
FHLB advances 20,000  490.98%  270,500  4680.70%  278,077  2990.43% 
Subordinated debentures 116,850  1,6365.59%  30,950  3734.82%  18,781  1964.20% 
Total interest-bearing liabilities 3,083,461  8,1481.06%  2,979,139  5,9950.82%  2,605,737  4,1790.65% 
             
Noninterest-bearing liabilities:            
Demand deposits: noninterest-bearing 1,219,876     1,196,151     1,170,486    
Other liabilities 27,853     28,658     31,262    
             
Stockholders' equity 544,283     534,273     518,015    
             
Total liabilities and stockholders' equity$  4,875,473     $  4,738,221     $  4,325,500     
             
Net interest income $   43,673    $   42,860    $  40,491   
             
Cost of deposits  0.62%   0.54%   0.43% 
Net interest spread  3.46%   3.62%   3.78% 
Net interest margin  3.81%   3.89%   4.02% 
             
             
             
(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, 2017 June 30, 2016     
  InterestAverage  InterestAverage     
 AverageIncome /Yield / AverageIncome /Yield /     
 BalanceExpenseRate BalanceExpenseRate     
Assets            
Interest-earning assets:            
Loans (1)$3,917,004 $93,3494.81% $3,260,625 $79,7124.92%     
Securities (2) 556,129  6,4682.33%  670,063  6,9261.03%     
FRB and FHLB stock 16,385  6578.09%  30,652  1,1213.66%     
Interest-bearing deposits in other banks 43,026  2000.94%  41,343  970.47%     
Total interest-earning assets 4,532,544  100,6744.48%  4,002,683  87,8564.41%     
             
Noninterest-earning assets:            
Cash and due from banks 117,273     114,455        
Allowance for loan losses (33,193)    (42,001)       
Other assets 190,602     198,151        
Total noninterest-earning assets 274,682     270,605        
             
Total assets$  4,807,226     $  4,273,288         
             
Liabilities and Stockholders' Equity            
Interest-bearing liabilities:            
Deposits:            
Demand: interest-bearing$95,727 $380.08% $95,979 $380.08%     
Money market and savings 1,470,165  5,8900.81%  923,196  2,2950.50%     
Time deposits 1,247,000  5,6890.92%  1,307,347  5,0770.78%     
Total interest-bearing deposits 2,812,892  11,6170.83%  2,326,522  7,4100.64%     
FHLB advances 144,558  5170.72%  229,973  4940.43%     
Subordinated debentures 74,137  2,0095.41%  18,751  3794.06%     
Total interest-bearing liabilities 3,031,587  14,1430.94%  2,575,246  8,2830.65%     
             
Noninterest-bearing liabilities:            
Demand deposits: noninterest-bearing 1,208,079     1,154,654        
Other liabilities 28,255     34,646        
             
Stockholders' equity 539,305     508,742        
             
Total liabilities and stockholders' equity$  4,807,226     $  4,273,288         
             
Net interest income $   86,531    $   79,573       
             
Cost of deposits  0.58%   0.43%     
Net interest spread  3.54%   3.76%     
Net interest margin  3.85%   4.00%     
             
             
(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

Acquisition Accounting

Core loan yield, core deposit costs, net interest income and net interest margin excluding acquisition accounting are 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 results of operations. The calculation of these measures is illustrated below.  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 results 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:

  For the Three Months Ended           
 June 30, March 31, December 31, September 30, June 30,          
  2017  2017
  2016  2016
  2016           
Core loan yield 4.82% 4.68%  4.63% 4.63%  4.78%          
Accretion of discount on purchased loans 0.05% 0.06%  0.09% 0.08%  0.13%          
As reported 4.87% 4.74%  4.72% 4.71%  4.91%          
                    
Core deposit cost 0.63% 0.55%  0.54% 0.54%  0.52%          
Accretion of time deposits premium 0.01% 0.01%  0.04% 0.07%  0.09%          
As reported 0.62% 0.54%  0.50% 0.47%  0.43%          
                    
 
 For the Three Months Ended
 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016 June 30, 2016
  Amount   Rate   Amount   Rate   Amount   Rate   Amount   Rate   Amount   Rate 
Net interest income and net interest margin excluding acquisition accounting (1)$   43,129   3.76% $   42,230   3.84% $   41,489   3.86% $   38,874   3.75% $   38,671   3.84%
Accretion of discount on Non-PCI loans 457  0.04%  527  0.05%  781  0.07%  648  0.06%  994  0.10%
Accretion of discount on PCI loans 52  0.00%  54  0.00%  78  0.01%  26  0.00%  97  0.01%
Accretion of time deposits premium 116  0.01%  126  0.01%  314  0.03%  610  0.06%  791  0.08%
Amortization of subordinated debentures discount (81) -0.01%  (77) -0.01%  (90) -0.01%  (67) -0.01%  (62) -0.01%
Net impact 544  0.05%  630  0.05%  1,083  0.10%  1,217  0.11%  1,820  0.18%
As reported, on a fully taxable equivalent basis (1)$43,673   3.81% $   42,860   3.89% $42,572   3.96% $40,091   3.86% $40,491   4.02%
(1)  Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate:  rates may not sum due to rounding.          
                    


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, December 31, September 30, June 30, 
Hanmi Financial Corporation 2017   2017   2016   2016   2016  
Assets$  4,973,346  $  4,811,821  $  4,701,346  $  4,402,180  $  4,441,333  
Less goodwill   (11,031)    (11,031)    (11,031)    -      -   
Less other intangible assets,net   (1,681)    (1,766)    (1,858)    (1,456)    (1,537) 
Tangible assets$  4,960,634  $  4,799,024  $  4,688,457  $  4,400,724  $  4,439,796  
           
Common Stockholders' equity$  550,140  $  539,542  $  531,025  $  531,198  $  525,185  
Less goodwill   (11,031)    (11,031)    (11,031)    -     -  
Less other intangible assets   (1,681)    (1,766)    (1,858)    (1,456)    (1,537) 
Tangible Common stockholders' equity$  537,428  $  526,745  $  518,136  $  529,742  $  523,648  
           
Common Stockholders' equity to assets 11.06%  11.21%  11.30%  12.07%  11.82% 
Tangible common equity to tangible assets 10.83%  10.98%  11.05%  12.04%  11.79% 
           
Common shares outstanding   32,393,856     32,392,580     32,330,747     32,252,774     32,260,320  
Tangible common equity per common share$  16.59  $  16.26  $  16.03  $  16.42  $  16.23  
           

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

Richard Pimentel
Senior Vice President & Corporate Finance Officer
213-427-3191

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