Financial Performance - Net interest income for the three months ended September 30, 2025, was $126.64 million, an increase from $104.81 million in the same period of 2024, representing a growth of 20.8%[215] - Net income for the three months ended September 30, 2025, was $30.84 million, up from $24.16 million in 2024, reflecting a growth of 27.2%[215] - Net income for Q3 2025 was $30.8 million, or $0.24 per diluted share, an increase of 27.5% from $24.2 million, or $0.20 per diluted share in Q3 2024[228] - Year-to-date net income for the nine months ended September 30, 2025, was $24.1 million, or $0.19 per diluted share, a decrease of 68.1% from $75.3 million, or $0.62 per diluted share in the same period of 2024[229] - Net interest income for the nine months ended September 30, 2025, was $345.0 million, an increase of 5.9% from $325.7 million in the same period of 2024[234] - Noninterest income for the three months ended September 30, 2025, was $15.4 million, an increase of $3.5 million or 30.0% compared to $11.8 million for the same period in 2024[253] Asset and Equity Growth - Total assets of Hope Bancorp, Inc. reached $18.51 billion as of September 30, 2025, following the acquisition of Territorial Savings[212] - Total assets as of September 30, 2025, were $18.55 billion, compared to $17.37 billion as of September 30, 2024[243] - Total stockholders' equity as of September 30, 2025, was $2,255.9 million, compared to $2,169.8 million as of September 30, 2024[225] - Stockholders' equity rose to $2.26 billion at September 30, 2025, up from $2.13 billion at December 31, 2024, an increase of $121.4 million[319] - Total equity investments increased to $88.7 million, up $48.8 million or 122.1% from $39.9 million at December 31, 2024[283] Loan and Deposit Information - Average loans for the three months ended September 30, 2025, were $14.52 billion, up from $13.57 billion in the same period of 2024, representing a growth of 7.0%[217] - Total deposits reached $15.83 billion at September 30, 2025, an increase of $1.50 billion, or 10.5%, from $14.33 billion at December 31, 2024[303] - Loans receivable reached $14.59 billion, an increase of $968.6 million or 7.1% from $13.62 billion at December 31, 2024[287] - Loans held for sale rose to $33.1 million, an increase of $18.6 million or 128.5% from $14.5 million at December 31, 2024[286] Credit Quality and Losses - Provision for credit losses increased to $8.71 million for the three months ended September 30, 2025, compared to $3.28 million in the same period of 2024, indicating a rise of 165.5%[215] - Nonperforming loans to loans receivable remained stable at 0.77% as of September 30, 2025, compared to 0.76% in the previous year[219] - The allowance for credit losses (ACL) was $152.5 million, compared to $150.5 million at December 31, 2024, with an ACL coverage ratio of 1.05%[294] - Net loan charge-offs for the three months ended September 30, 2025, were 0.14% of average loans, compared to 0.17% for the same period in 2024[297] - Net loan charge-offs for the nine months ended September 30, 2025, totaled $25.38 million, compared to $13.72 million for the same period in 2024, reflecting an increase of 85.5%[298] Operational Efficiency - The efficiency ratio improved to 68.20% for the three months ended September 30, 2025, down from 69.67% in the same period of 2024[215] - Noninterest expense for Q3 2025 was $96.9 million, an increase of 19.2% from $81.3 million in Q3 2024[224] - The efficiency ratio excluding notable items for Q3 2025 was 67.52%, compared to 68.44% in Q3 2024[224] Acquisition Impact - The Company completed the acquisition of Territorial Savings Bank on April 2, 2025, becoming the largest regional bank serving multicultural customers across the continental U.S. and Hawaii[230] - The bank's common stock issued as consideration in the Territorial acquisition amounted to $73.3 million during the nine months ended September 30, 2025[319] - Salaries and employee benefits rose by $10.8 million, or 24.3%, for Q3 2025, driven by an increase in headcount post-Territorial acquisition, with full-time equivalent employees at 1,452[261] - Occupancy expense increased by $2.2 million, or 31.9%, for Q3 2025, attributed to the addition of 29 branches from the Territorial acquisition[262] Interest Rates and Margins - The net interest margin for the three months ended September 30, 2025, was 2.89%, an increase from 2.55% in the same period of 2024[215] - The weighted average yield on loans decreased to 5.93% for Q3 2025, down 23 basis points from 6.16% in Q3 2024[237] - The weighted average cost of deposits for Q3 2025 was 2.88%, down 56 basis points from 3.44% in Q3 2024, influenced by lower market interest rates and the acquisition of lower-cost deposits[240] Tax and Regulatory Information - The company recorded an income tax provision of $5.6 million on pretax income of $36.5 million for Q3 2025, resulting in an effective tax rate of 15.40%[268] - Total tax credits and benefits from affordable housing partnerships were approximately $3.4 million for Q3 2025, compared to $2.8 million for the same period in 2024[271] - The bank's total capital ratio was 13.83% as of September 30, 2025, exceeding the required well-capitalized ratio[322] - The bank's leverage capital ratio was 10.85% as of September 30, 2025, indicating strong capital management[322]

Core Insights - The focus is on value investing with an emphasis on fundamental research across various sectors including chemicals, homebuilders, building materials, industrials, and metals & mining [1] - The investment strategy targets stocks that are undervalued and have potential catalysts within a timeframe of one quarter to two years [1] - The experience includes over three years of active investing, with roles as a buy-side analyst at a boutique research firm and family offices [1] Sector and Company Analysis - The sectors of interest are characterized by their potential for growth and value opportunities, particularly in the context of current market conditions [1] - The investment horizon indicates a strategic approach to capturing short to medium-term gains, aligning with market catalysts [1] - The emphasis on cheap stock availability suggests a focus on identifying undervalued companies that may be overlooked by the broader market [1]

Core Insights - Hope Bancorp, Inc. reported an earnings per share (EPS) of $0.23 for Q3 2025, which was below the estimated EPS of $0.25, indicating a negative earnings surprise [2][6] - The company's revenue for the quarter was $126.6 million, falling short of the estimated $138.9 million, but showing a year-over-year increase from $116.65 million [3][6] - Net income for Q3 2025 was $30.8 million, representing a 28% increase from the net income of $24.2 million in the same period in 2024 [4][6] Financial Performance - The EPS of $0.23 reflects an improvement from $0.21 per share reported in the same quarter last year [2] - Revenue growth demonstrates strong performance despite missing estimates, with a significant increase from the previous year's revenue [3] - The company's net income growth indicates a turnaround from previous financial challenges [4] Valuation Metrics - Hope Bancorp has a price-to-earnings (P/E) ratio of approximately 28.46 and a price-to-sales ratio of about 1.47, providing insight into its market valuation [5] - The enterprise value to sales ratio is around 0.98, while the enterprise value to operating cash flow ratio is approximately 6.17, which helps assess the company's potential for future growth [5]

Financial Data and Key Metrics Changes - Net income for Q3 2025 totaled $31 million, up 28% year-over-year from $24 million in Q3 2024 and up from a net loss of $28 million in Q2 2025 [5][6] - Net interest income reached $127 million for Q3 2025, an increase of 8% from the prior quarter and up 21% from Q3 2024 [10] - Net interest margin expanded by 20 basis points to 2.89% for Q3 2025, marking the best linked quarter expansion since 2012 [7][10] Business Line Data and Key Metrics Changes - Loan growth was observed across all major segments: C&I, commercial real estate, and residential mortgage, with gross loans totaling $14.6 billion, up 1.2% quarter-over-quarter [6][8] - Non-interest income showed growth in service fees on deposit accounts, international banking fees, foreign exchange, and wire transfer fees [11] Market Data and Key Metrics Changes - Deposits totaled $15.8 billion as of September 30, 2025, reflecting a 1% decrease from $15.9 billion as of June 30, primarily due to a reduction in brokered deposits [8] - Non-interest-bearing deposits increased by 1% quarter-over-quarter to $3.5 billion [8] Company Strategy and Development Direction - The company is focused on strengthening its deposit franchise and deepening primary banking relationships while optimizing deposit mix and pricing [8] - The outlook for 2025 includes expectations for high single-digit loan growth and approximately 10% growth in net interest income [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to drive profitable growth and create long-term value for stockholders, supported by strategic additions to banking teams [16] - The company anticipates a fourth quarter effective tax rate of approximately 14%, excluding notable items [16] Other Important Information - The Board declared a quarterly common stock dividend of $0.14 per share, payable on November 21, 2025 [8] - The company reported a 57% reduction in net charge-offs, reflecting improved asset quality [7][13] Q&A Session Summary Question: Spot rate on deposits and average margin for September - The spot rates for total deposits and interest-bearing deposits were 2.82% and 3.62%, respectively, with the average margin for September at 2.96% [19][21] Question: Update on Territorial acquisition and cost savings - The company is focusing on stabilizing and expanding operations post-acquisition, with incremental cost savings being realized [22] Question: Purchase accounting impact for the quarter - Loan accretion from the acquisition was $5 million for the quarter [25][26] Question: Maturing CDs in Q4 - The company has $2.3 billion of CDs maturing in Q4 at an average rate of 4.08% [32][34] Question: Loan growth outlook and impact of rates - The company has a strong loan pipeline going into Q4 and expects to maintain loan growth despite potential rate decreases [52] Question: Competitive environment for deposits - The company has reduced CD pricing following the Fed funds cut and is optimistic about managing deposit costs effectively [54][55]

Financial Data and Key Metrics Changes - Net income for Q3 2025 totaled $31 million, up 28% year over year from $24 million in the same quarter last year, and improved from a net loss of $28 million in Q2 2025 [5][6] - Net interest income reached $127 million for Q3 2025, an increase of 8% from the prior quarter and up 21% from Q3 2024 [10] - Net interest margin expanded by 20 basis points to 2.89% for Q3 2025, compared to 2.69% in the previous quarter [10] Business Line Data and Key Metrics Changes - Loan growth was observed across all major segments: commercial and industrial loans, commercial real estate loans, and residential mortgage loans [7] - Gross loans totaled $14.6 billion, up 1.2% quarter over quarter, equivalent to 5% annualized growth [8] - Non-interest income showed quarter-over-quarter growth in service fees, international banking fees, foreign exchange, and wire transfer fees [11] Market Data and Key Metrics Changes - Deposits totaled $15.8 billion as of September 30, 2025, reflecting a 1% decrease from $15.9 billion as of June 30, primarily due to a reduction in brokered deposits [8] - Non-interest-bearing deposits increased to $3.5 billion, up 1% quarter over quarter [8] Company Strategy and Development Direction - The company is focused on strengthening its deposit franchise and deepening primary banking relationships while optimizing deposit costs [8] - Continued investments in talent are aimed at driving sustainable growth and enhancing corporate and commercial banking capabilities [9] - The company anticipates high single-digit loan growth for 2025 and expects net interest income growth of approximately 10% [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's position to drive profitable growth and create long-term value for shareholders [15] - The company is well-positioned to navigate an evolving macroeconomic environment with improved asset quality and capital ratios [7][8] Other Important Information - The board declared a quarterly common stock dividend of $0.14 per share, payable on November 21, 2025 [8] - The provision for credit losses was $9 million for Q3 2025, down from $15 million in Q2 2025, reflecting lower net charge-offs [13][14] Q&A Session Summary Question: What is the spot rate on deposits? - The spot rate for total deposits at the end of September was 2.82%, and for interest-bearing deposits, it was 3.62% [19] Question: Any updates on Territorial Bancorp's integration? - The company is focusing on stabilizing and expanding operations post-acquisition, with incremental cost savings being realized [22] Question: What was the purchase accounting impact this quarter? - The loan accretion for this quarter was $5 million [25][26] Question: How much in CDs are maturing in the fourth quarter? - There are $2.3 billion of CDs maturing at an average rate of 4.08% [32][34] Question: How is the company managing loan growth amid potential rate decreases? - The company has a strong loan pipeline going into Q4 and expects to maintain loan growth despite seasonal slowdowns [52]

Financial Data and Key Metrics Changes - Net income for Q3 2025 totaled $31 million, up 28% year over year from $24 million in Q3 2024, and improved from a net loss of $28 million in Q2 2025 [6][7] - Net interest income reached $127 million, an increase of 8% from the prior quarter and up 21% from Q3 2024 [10] - Net interest margin expanded by 20 basis points to 2.89% for Q3 2025, marking the best linked quarter expansion since 2012 [7][10] Business Line Data and Key Metrics Changes - Loan growth was observed across all major segments: commercial and industrial loans, commercial real estate loans, and residential mortgage loans [7][9] - Gross loans totaled $14.6 billion, up 1.2% quarter over quarter, equivalent to 5% annualized growth [8][9] - Non-interest income showed quarter-over-quarter growth in service fees, international banking fees, and wire transfer fees [11] Market Data and Key Metrics Changes - Deposits totaled $15.8 billion, reflecting a 1% decrease from $15.9 billion as of June 30, primarily due to a reduction in brokered deposits [8] - Non-interest-bearing deposits increased to $3.5 billion, up 1% quarter over quarter [8] Company Strategy and Development Direction - The company is focused on strengthening its deposit franchise and deepening primary banking relationships while optimizing deposit costs [8][9] - Continued investments in talent are aimed at driving sustainable growth and enhancing corporate and commercial banking capabilities [9][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about achieving high single-digit loan growth in 2025 and expects net interest income growth of approximately 10% [16] - The company anticipates non-interest income growth of approximately 30% for 2025, excluding notable items from the second quarter [16] Other Important Information - The board declared a quarterly common stock dividend of $0.14 per share, payable on November 21, 2025 [8] - The allowance for credit losses totaled $152.5 million at September 30, 2025, with a coverage ratio of 1.05% of loans receivable [14] Q&A Session Summary Question: Spot rate on deposits and average margin for September - The spot rate for total deposits was 2.82% and for interest-bearing deposits was 3.62%, with the average margin for September at 2.96% [20] Question: Update on Territorial Bancorp acquisition - Operations are being stabilized and expanded, with incremental cost savings being realized, but no significant updates reported this quarter [21] Question: Purchase accounting impact this quarter - Loan accretion for the quarter was $5 million, up from $4 million in the previous quarter [24][25] Question: Maturing CDs in the fourth quarter - There are $2.3 billion of maturing CDs at an average rate of 4.08% [31] Question: Expense side and hiring process - New team members are being added in strategic segments, with a focus on strengthening existing capabilities and optimistic growth prospects [39][41] Question: Impact of government shutdown on SBA loan sales - The SBA has suspended acceptance of new loan applications, but existing loans with approval numbers will proceed as usual [44][45] Question: Challenges with non-accrual loans in commercial real estate - Non-performing loans have been relatively flat, with ongoing efforts to resolve problem credits [46] Question: Loan growth outlook and impact of potential rate decreases - A strong loan pipeline is expected to support growth, with improvements in commercial and industrial loans [51]

Core Insights - The company reported a significant improvement in asset quality, with a 57% reduction in net charge-offs and a 17% decrease in criticized loans in the commercial and industrial (C&I) segment [1][10] - The net income for the third quarter of 2025 was $32 million, reflecting a 29% increase from the previous year, driven by loan growth across major segments and an expansion in net interest margin [2][3] - The company declared a quarterly common stock dividend of $0.14 per share, payable on November 21, 2025 [1] Financial Performance - Net interest income for the third quarter totaled $127 million, an 8% increase from the prior quarter and a 21% increase year-over-year [6] - The net interest margin expanded by 20 basis points to 2.89%, the best linked quarter expansion since 2012 [2][6] - Noninterest income growth is expected to be approximately 30% for 2025, excluding notable items from the second quarter [12] Loan and Deposit Growth - Total deposits as of September 30, 2025, were $15.8 billion, a slight decrease of 1% from the previous quarter, primarily due to a reduction in broker deposits [5] - Gross loans, including those held for sale, totaled $14.6 billion, reflecting a 1.2% quarter-over-quarter increase [5] - The criticized loan ratio improved to 2.56% of total loans, down from 2.87% in the previous quarter [10] Strategic Initiatives - The company has been investing in talent to support growth, particularly in corporate and commercial banking, which is expected to enhance revenue growth [6][13] - The acquisition of Territorial Bancorp has strengthened the deposit position and is expected to yield cost savings as operations stabilize [7][12] - The company anticipates high single-digit loan growth for the full year 2025, supported by a strong loan pipeline [12][30] Expense Management - Noninterest expenses totaled $97 million in the third quarter, with a notable increase attributed to higher compensation-related costs due to talent investments [8][9] - The efficiency ratio, excluding notable items, improved to 67.5% compared to 69.1% in the previous year [9]

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Financial Performance - GAAP Net Income for 3Q25 was $30.8 million, or $0.24 per diluted common share[4] - Net Income excluding notable items for 3Q25 was $31.6 million, or $0.25 per diluted common share, up 29% QoQ[4] - Net interest income for 3Q25 was $127 million, up 8% QoQ[21] - Noninterest income totaled $15.4 million in 3Q25[33] Balance Sheet & Capital - Total deposits were $15.8 billion at 9/30/25, a decrease of 1% QoQ[4, 15] - Gross loans totaled $14.6 billion at 9/30/25, up 1.2% QoQ (5% annualized)[4, 18] - Total capital ratio was 13.83% and TCE ratio was 9.63% at 9/30/25[4] Asset Quality - Nonperforming assets (NPA) were $112 million, representing 0.61% of total assets at 9/30/25[4] - Classified loans at 9/30/25 were down 13% QoQ, representing 1.66% of total loans[4] - Net charge-offs (NCO) were $5 million in 3Q25, or 14bps of average loans, annualized, down 57% QoQ[46] Outlook - The company anticipates approximately 10% growth in net interest income for the full year 2025[47] - The company anticipates approximately 30% growth in noninterest income (excluding notable items) for the full year 2025[47]

Core Insights - Hope Bancorp reported revenue of $142.03 million for Q3 2025, a year-over-year increase of 21.8% and exceeding the Zacks Consensus Estimate of $139.15 million by 2.07% [1] - The company's EPS for the quarter was $0.25, compared to $0.21 a year ago, but fell short of the consensus estimate of $0.26, resulting in an EPS surprise of -3.85% [1] Financial Performance Metrics - Efficiency Ratio was reported at 68.2%, higher than the two-analyst average estimate of 66.4% [4] - Net Interest Margin stood at 2.9%, slightly above the two-analyst average estimate of 2.8% [4] - Net charge-offs to average loans were 0.1%, better than the estimated 0.2% by two analysts [4] - Net Interest Income (before provision) was $126.64 million, exceeding the average estimate of $123.93 million [4] - Total noninterest income reached $15.39 million, surpassing the average estimate of $15.22 million [4] - Net gains on sales of SBA loans were $2.77 million, below the two-analyst average estimate of $3.28 million [4] Stock Performance - Over the past month, shares of Hope Bancorp returned -0.3%, while the Zacks S&P 500 composite increased by 3.6% [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]