Hanmi Financial (US:HAFC)2025-10-21 20:23Financial Performance - Net income for Q3 2025 was $22.1 million, a 45.9% increase from $15.1 million in Q2 2025, translating to $0.73 per diluted share compared to $0.50[3][7] - Net income for the quarter was $22,061,000, a 45.9% increase from $15,117,000 in the previous quarter[45] - Net income increased by 23.2% to $54,850,000, compared to $44,506,000 for the same period in 2024[47] - Basic and diluted earnings per share both rose to $1.82, up from $1.47 in the prior year[47] Loan Production and Receivables - Loan production reached $571 million, up 73% from the previous quarter, with loans receivable totaling $6.53 billion, a 3.5% increase from Q2 2025[4][7] - New loan production for Q3 2025 was $570.8 million, with commercial and industrial loans contributing $211.5 million and residential mortgage loans contributing $103.2 million[22][23] - Loans receivable increased to $6,304,435 thousand, up 0.7% from Q2-2025 and 3.1% from Q3-2024[12] - As of September 30, 2025, total loans receivable increased to $6.53 billion, reflecting a 2.8% increase from the previous quarter and a 3.5% increase year-over-year[21] Interest Income and Margin - Net interest income increased by $3.9 million to $61.1 million, reflecting a 6.9% rise from $57.1 million in Q2 2025, with a net interest margin of 3.22%[7][9] - The net interest margin improved to 3.22% in Q3-2025, up from 3.07% in Q2-2025[13] - Net interest income after credit loss expense increased by 19.0% to $58,934,000 compared to $49,508,000 in the previous quarter[45] - Total interest and dividend income increased by 2.4% to $305,815,000 for the nine months ended September 30, 2025, compared to $298,670,000 in 2024[46] Asset Management - Total assets remained at $7.86 billion as of September 30, 2025, with a $219.3 million increase in loans, net of allowance for credit losses[19] - Total assets as of September 30, 2025, were $7,784,033,000, compared to $7,702,363,000 in 2024[49] - The tangible common equity to tangible assets ratio stood at 9.80% as of September 30, 2025, compared to 9.41% a year earlier, indicating improved capital strength[55] Deposits - Deposits grew to $6.77 billion, a 0.6% increase from Q2 2025, with noninterest-bearing demand deposits at 30.8% of total deposits[7][9] - Deposits reached $6.77 billion at the end of Q3 2025, up $37.5 million or 0.6% from the prior quarter, driven by a $57.9 million increase in time deposits[24] - Total deposits rose by 0.6% to $6,766,639,000, up from $6,729,122,000 in the previous quarter[43] Credit Quality - Credit loss expense decreased to $2.1 million, down $5.5 million from the previous quarter, with nonperforming assets at $21.4 million, a 17.7% decline[7][9] - Nonperforming loans decreased to $19.4 million, down from $26.0 million in the prior quarter, primarily due to loan upgrades and charge-offs[30] - The allowance for credit losses rose to $69.8 million, or 1.07% of loans, reflecting proactive asset management practices[7][9] - Gross charge-offs for Q3 2025 were $2.6 million, a significant decrease from $12.4 million in the preceding quarter, primarily due to an $8.6 million charge-off in Q2 2025[32] Efficiency and Cost Management - The efficiency ratio improved to 52.65%, down from 55.74% in Q2 2025, indicating better cost management[7][9] - Noninterest expense increased to $37,357 thousand, a 2.8% rise from Q2 2025, primarily due to higher professional fees[18] - Total noninterest expense increased by 1.8% to $108,689,000, up from $106,800,000 year-over-year[47] Future Outlook - The company anticipates future operating and financial performance improvements, although actual results may differ due to various risks[40][41] - Unused commitments to extend credit were $952.5 million as of September 30, 2025[36] Shareholder Returns - The company declared a cash dividend of $0.27 per share for Q3 2025, payable on August 20, 2025[37] - The company repurchased 199,698 common shares at a weighted average price of $23.45 during the third quarter[7][9]