Hope Bancorp — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net income for the third quarter of 2026 was $35.6 million ($0.28 per diluted share), an 8% increase from $33.0 million in the second quarter and a 16% increase from $30.8 million in the third quarter of 2025.
• Excluding notable items (merger-related costs), third quarter 2026 net income was $37.5 million ($0.29 per diluted share).
• Net interest income totaled $135.4 million, up 5% sequentially and 7% year-over-year.
• Net interest margin was 3.02%, up 6 basis points sequentially and 13 basis points year-over-year.
• Noninterest income was $22.1 million, up 17% sequentially and 44% year-over-year, driven by growth in customer fees and net gains on SBA loan sales.
• Noninterest expense was $102.8 million, up 4% sequentially and 6% year-over-year.
• Pre-provision net revenue was $54.7 million, up 11% sequentially and 21% year-over-year.
• The efficiency ratio improved to 65.3% in the third quarter, down from 66.6% in the prior quarter and 68.2% in the year-ago quarter.
• Total assets were $19.19 billion at September 30, 2026.
• Gross loans totaled $15.12 billion, up 1% sequentially and 3% year-over-year.
• Total deposits were $16.12 billion, up 2% sequentially and 2% year-over-year.
• Net charge-offs were $7.0 million (0.19% annualized of average loans), down from $9.0 million in the prior quarter.
• Provision for credit losses was $8.6 million.
• Allowance for credit losses totaled $154.3 million, with a coverage ratio of 1.03% of loans receivable.
• Total stockholders' equity was $2.26 billion; book value per share was $17.67.

Guidance and Future Outlook:

• Management expressed confidence in sustainable and profitable earnings growth across operating environments, citing year-to-date earnings momentum.
• Strategic benefits from the SMBC MANUBANK acquisition are expected to bolster progress in 2027 and beyond.
• The company aims to continue improving profitability through loan growth, lower deposit costs, net interest margin expansion, and disciplined expense management.

Business Segments and Product Lines:

• Commercial and industrial (C&I) and residential mortgage loan portfolios grew sequentially.
• All major loan portfolios (C&I, residential mortgage, and commercial real estate) grew year-over-year.
• The company sold $72.2 million of SBA loans in the third quarter for a net gain of $4.7 million.
• Deposits saw a shift in mix: money market, interest-bearing demand, and savings deposits increased 10% sequentially, while time deposits decreased 5% as the company focused on reducing the cost of funds.
• The share of time deposits in the deposit mix decreased to 36.7% at September 30, 2026, down from 39.9% a year ago.

Market and Competitive Landscape:

• The company serves multicultural customers across the continental United States and Hawaii, with a network of 45 branches in the continental U.S. and 28 in Hawaii.
• Following the acquisition of the SMBC MANUBANK Commercial Banking Unit, seven additional locations in California were added.

Risks and Challenges:

• Forward-looking statements highlight risks related to the integration of the SMBC MANUBANK acquisition, including potential difficulties, delays, and costs.
• Risks include deposit attrition, operating costs, customer loss, business disruption, and challenges in maintaining employee and customer relationships post-acquisition.
• Rising interest rates negatively impacted the fair value of available-for-sale securities, contributing to a decrease in accumulated other comprehensive income.

Management Commentary and Tone:

• Kevin S. Kim, Chairman, President, and CEO, stated that revenue growth and positive operating leverage drove strong results.
• Management highlighted the acquisition of the SMBC MANUBANK Commercial Banking Unit as a milestone to expand presence in Southern California, enhance the deposit base, and serve multinational customers.
• The tone was confident regarding future growth and the strategic value of the collaboration with Sumitomo Mitsui Banking Corporation (SMBC).

Other Key Points:

• On October 1, 2026, the Company completed the acquisition of the Commercial Banking Unit of SMBC MANUBANK.
• The acquisition included approximately $2.20 billion in loans (comprising $1.35 billion in real estate loans and $0.85 billion in commercial loans) and $2.60 billion in deposits.
• The Company received an estimated net cash settlement of $307.4 million from the seller, SMBC.
• MANUBANK's SBA loan portfolio (purchased guaranteed portions) was sold on October 21, 2026, for $191.3 million with no gain or loss recognized.
• The Company paid a quarterly common stock dividend of 14 cents per share during the third quarter.
• The efficiency ratio excluding notable items was 63.6% for the third quarter.
• The year-to-date effective tax rate for the first nine months of 2026 was 22.5%.