In This Article:
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Net Income: $14.9 million or $0.49 per diluted share.
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Return on Average Assets: 0.79%.
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Return on Average Stockholder's Equity: 7.55%.
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Net Interest Margin: Expanded by 5 basis points to 2.74%.
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Total Loans Growth: 2% sequentially.
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New Loan Production: Increased by 27% to $348 million.
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Commercial Real Estate Loan Production: Increased by 26%.
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Commercial and Industrial Loan Production: Increased by 78%.
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Residential Loan Production: Increased by 35%.
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Deposits Growth: 1.2%, with a nearly 5% increase in noninterest-bearing deposits.
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Noninterest Expense: Declined by 0.6% to $35.1 million.
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Allowance for Credit Losses to Loans Ratio: Increased by 1 basis point to 1.11%.
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Net Interest Income: $50.1 million, up 2.9% from the second quarter.
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Noninterest Income: $8.4 million, a 5% increase from the second quarter.
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Tangible Book Value Per Share: $24.03.
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Tangible Equity to Tangible Asset Ratio: 9.42%.
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Common Equity Tier 1 Capital Ratio: 11.95%.
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Total Capital Ratio: 14.28%.
Release Date: October 22, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Hanmi Financial Corp (NASDAQ:HAFC) reported a net income of $14.9 million or $0.49 per diluted share for the third quarter of 2024.
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Total loans grew by 2% sequentially, with new loan production increasing by 27%, driven by significant growth in commercial real estate, commercial and industrial, and residential loan production.
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Deposits increased by 1.2%, with a nearly 5% rise in noninterest-bearing deposits and a 3.5% increase in money market and savings accounts.
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The company successfully sold residential mortgage loans into the secondary market for the third consecutive quarter, bringing year-to-date sales to $70 million.
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Hanmi Financial Corp (NASDAQ:HAFC) maintained strong asset quality, with a low ratio of allowance for credit losses to loans at 1.11% and proactive management of criticized and nonaccrual loans.
Negative Points
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Net interest margin expanded only slightly by 5 basis points, indicating limited improvement in profitability from interest-earning assets.
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SBA loan production decreased by $3 million in the third quarter, although it still exceeded the quarterly target range.
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The company faced challenges with certain loans, including those in the hotel sector, which experienced slow post-COVID recovery, leading to their classification as special mention loans.
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Despite strong capital ratios, Hanmi Financial Corp (NASDAQ:HAFC) faced questions about its conservative approach to share buybacks, given its trading below tangible book value.
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Noninterest income growth was partly driven by a one-time gain from a branch sale and leaseback, which may not be sustainable in future quarters.