Hope Bancorp, Inc. (the "Company") (NASDAQ:HOPE), the holding company of Bank of Hope (the "Bank"), today reported unaudited financial results for its third quarter and nine months ended September 30, 2022.

For the three months ended September 30, 2022, net income totaled $53.7 million, or $0.45 per diluted common share, compared with $52.1 million, or $0.43 per diluted common share, in the preceding second quarter and $55.5 million, or $0.45 per diluted common share, in the year-ago third quarter.

"We delivered a strong performance for the third quarter of 2022 that demonstrates the significant strides we have made in transforming the profile of our franchise to a lower-risk, high-performing regional bank," said Kevin S. Kim, Chairman, President and Chief Executive Officer. "We broke new ground yet again with another record high in originations totaling $1.35 billion and representing a well diversified mix with commercial loans accounting for 55% of new loans. Loans receivable grew 6.5% quarter-over-quarter or 11% year-to-date, and together with the increased yields on our interest-earning assets outpacing deposit cost growth, our net interest margin expanded by 13 basis points for the quarter. This, together with the strong loan growth and higher loan yields, resulted in an 8% quarter-over-quarter and 18% year-over-year increase in our net interest income for the third quarter of 2022. We are also pleased that our enhanced credit administration framework is driving ongoing improvements in our asset quality with total nonperforming assets and total criticized loans decreasing 12% and 17%, respectively, quarter-over-quarter. The improved earnings power of Bank of Hope is underscored by the improvements in our pre-provision net revenue, which increased 12% quarter-over-quarter to a record high for the Company.

"As we move forward into the final quarter of the year, our board and management team remain confident in our ability to navigate through the challenges of the current environment and deliver strong financial results for our stockholders for the long term," said Kim.

Q3 2022 Highlights

Loan originations totaled a record $1.35 billion, representing a well-diversified mix of new loan production with new commercial loans accounting for 55% of total originations for the quarter.
Loans receivable increased 6.5% quarter-over-quarter, or 11% year-to-date.
Criticized loan balances continued its downward trend, decreasing 17% quarter-over-quarter, or 43% year-to-date.
Total nonperforming assets declined 12% quarter-over-quarter and represented 0.51% of total assets.
Company recorded a provision for credit losses of $9.2 million, primarily reflecting strong loan growth and increased recessionary risk factors.
Net interest income increased 8% quarter-over-quarter and 18% year-over-year.
Net interest margin expanded 13 basis points from the preceding second quarter, benefiting from 4% linked-quarter increase in average loans outstanding and a 59 basis-point expansion in average loan yields.
Total deposits increased 3.1% quarter-over-quarter, reflecting increases in time deposits.
Total cost of deposits increased 46 basis points quarter-over-quarter, reflecting the impact of increases in the Federal Funds target rates since June 2022.
Pre-provision net revenue increased 11.8% quarter-over-quarter to a record high $82.6 million.

Financial Highlights

	At or for the Three Months Ended
(dollars in thousands, except per share data) (unaudited)	9/30/2022			6/30/2022			9/30/2021
Net income	$	53,748		$	52,088		$	55,499
Diluted earnings per share	$	0.45		$	0.43		$	0.45
Pre-provision net revenue ("PPNR") ⁽¹⁾	$	82,627		$	73,919		$	65,411
Net interest income before provision (credit) for credit losses	$	153,186		$	141,538		$	130,296
Net interest margin		3.49	%		3.36	%		3.07	%
Noninterest income	$	13,355		$	12,746		$	10,617
Noninterest expense	$	83,914		$	80,365		$	75,502
Net loans receivable	$	15,330,626		$	14,394,469		$	13,281,917
Deposits	$	15,502,209		$	15,029,630		$	15,062,527
Total cost of deposits		0.79	%		0.33	%		0.26	%
Nonaccrual loans⁽²⁾	$	64,571		$	69,522		$	54,380
Nonperforming loans to loans receivable⁽²⁾		0.62	%		0.75	%		0.73	%
ACL to loans receivable		1.04	%		1.04	%		1.02	%
ACL to nonaccrual loans⁽²⁾		248.66	%		218.03	%		251.52	%
ACL to nonperforming assets⁽²⁾		165.55	%		137.09	%		120.33	%
Provision (credit) for credit losses	$	9,200		$	3,200		$	(10,000	)
Net charge offs (recoveries)	$	219		$	(930	)	$	42,678
Return on average assets ("ROA")		1.17	%		1.17	%		1.25	%
Return on average equity ("ROE")		10.58	%		10.33	%		10.61	%
ROA (PPNR) ⁽¹⁾		1.79	%		1.65	%		1.47	%
ROE (PPNR)⁽¹⁾		16.26	%		14.66	%		12.51	%
Return on average tangible common equity ("ROTCE")⁽¹⁾		13.77	%		13.48	%		13.71	%
Noninterest expense / average assets		1.82	%		1.80	%		1.70	%
Efficiency ratio		50.39	%		52.09	%		53.58	%

⁽¹⁾		Pre-provision net revenue, ROA (PPNR), ROE (PPNR), and ROTCE are non-GAAP financial measures. Management's reasons and purposes for using these non-GAAP financial measures are set forth on Table Pages 10 and 11 of this earnings release. A quantitative reconciliation of the Company's GAAP to non-GAAP financial measures are provided in the accompanying financial information on Table Pages 10 and 11.
⁽²⁾		Excludes delinquent SBA loans that are guaranteed and currently in liquidation.

Operating Results for the 2022 Third Quarter

Net interest income before provision for credit losses for the 2022 third quarter increased 8% to $153.2 million from $141.5 million in the 2022 second quarter and increased 18% from $130.3 million in the 2021 third quarter. The Company attributed the increase to higher interest income largely due to a favorable shift in our mix of earning assets, as well as higher average balances of loans receivable and an increase in loan yields, partially offset by higher interest expense on deposits.

The net interest margin for the 2022 third quarter increased 13 basis points to 3.49% from 3.36% in the preceding second quarter and increased 42 basis points from 3.07% in the year-ago third quarter, as the expansion of the yields on interest-earning assets outpaced the increase in the cost of deposits.

The weighted average yield on loans for the 2022 third quarter was 4.65%, up 59 basis points from 4.06% in the 2022 second quarter and up 68 basis points from the year-ago third quarter. The Company attributed the quarter-over-quarter increase in weighted average yield on loans to the repricing of its variable rate loans following the increases in the market interest rates, as well as a significant increase in the average rate of new loans originated during the quarter.

The weighted average cost of deposits for the 2022 third quarter increased by 46 basis points to 0.79% from 0.33% in the 2022 second quarter, primarily reflecting a 71 basis point increase in the cost of interest bearing deposits due to the previously mentioned Federal Funds target rate hikes. Compared with the year-ago third quarter, the weighted average cost of deposits for the 2022 third quarter increased 53 basis points from 0.26%, reflecting an 83 basis point increase in the cost of interest bearing deposits.

Noninterest income for the 2022 third quarter increased 5% to $13.4 million from $12.7 million in the 2022 second quarter. Quarter-over-quarter reductions in the net gains on sales of SBA loans and residential mortgage loans were more than offset by increases across most all other noninterest income categories. Most notably, other income and fees increased 94% quarter-over-quarter, which largely reflects higher swap fee income and a reduction in fair value losses on equity investments. During the 2022 third quarter, the Company sold $57.8 million in the guaranteed portion of SBA 7(a) loans and $3.7 million in retail mortgage loans, compared with $70.2 million and $4.1 million, respectively, sold in the preceding second quarter. Noninterest income for the 2022 third quarter increased 26% compared with $10.6 million in the third quarter of 2021, primarily reflecting higher service fees on deposit accounts, as well as other income and fees.

Noninterest expense for the 2022 third quarter increased 4% to $83.9 million from $80.4 million for the preceding second quarter, largely reflecting higher salaries and employee benefits and other noninterest expenses, partially offset by lower credit related expenses. For the 2021 third quarter, noninterest expense totaled $75.5 million.

Salaries and employee benefits expense for the 2022 third quarter increased to $53.2 million from $51.1 million in the preceding second quarter, largely reflecting higher incentive compensation accruals related to the strong financial performance. Salaries and employee benefits expense for the 2021 third quarter totaled $47.0 million.

Other noninterest expense for the 2022 third quarter increased to $10.8 million from $6.3 million in the 2022 second quarter and $6.4 million in the 2021 third quarter, largely reflecting higher earnings credit expenses as a result of recent Fed Fund rate hikes and higher amortization expense related to low-income housing tax credits.

The Company's efficiency ratio for the 2022 third quarter was 50.39%, compared with 52.09% in the preceding second quarter and 53.58% in the year-ago third quarter. Noninterest expense as a percentage of average assets was 1.82% for the 2022 third quarter, compared with 1.80% for the 2022 second quarter and 1.70% for the 2021 third quarter.

The effective tax rate for the 2022 third quarter was 26.8%, compared with 26.4% for the preceding second quarter and 26.4% in the year-ago third quarter.

Balance Sheet Summary

New loan originations during the 2022 third quarter totaled $1.35 billion, reflecting a 5% increase over the preceding second quarter and a 34% increase over the year-ago third quarter.

Following are the components of new loan production for the quarters ended September 30, 2022, June 30, 2022, and September 30, 2021.

	For the Three Months Ended
(dollars in thousands) (unaudited)	9/30/2022		6/30/2022		9/30/2021
Commercial real estate	$	500,826	$	522,093	$	488,969
Commercial		732,341		544,639		329,702
SBA		47,428		35,085		115,023
Residential mortgage		67,079		181,408		75,007
Consumer		1,020		2,770		500
Total new loan originations	$	1,348,694	$	1,285,995	$	1,009,201

At September 30, 2022, loans receivable increased 6.5% to $15.49 billion from $14.55 billion at June 30, 2022 and increased 15.4% from $13.42 billion at September 30, 2021.

Total deposits at September 30, 2022 increased 3.1% to $15.50 billion from $15.03 billion at June 30, 2022, largely reflecting an increase in time deposits, and increased 2.9% year-over-year from $15.06 billion at September 30, 2021. Quarter-over-quarter, noninterest bearing demand and money market and NOW deposits decreased 1.7% and 7.2%, respectively, but these decreases were more than offset by a 38.7% increase in time deposits. On a year-over-year basis, noninterest bearing demand deposits at September 30, 2022 decreased 6.9%, money market and NOW deposits increased 0.2%, and time deposits increased 29.3%.

Following is the deposit composition as of September 30, 2022, June 30, 2022 and September 30, 2021:

(dollars in thousands) (unaudited)	9/30/2022		6/30/2022		9/30/2021
Noninterest bearing demand deposits	$	5,590,952	$	5,689,992	$	6,007,586
Money market and other		5,885,093		6,339,467		5,871,567
Saving deposits		317,841		326,927		314,603
Time deposits		3,708,323		2,673,244		2,868,771
Total deposit balances	$	15,502,209	$	15,029,630	$	15,062,527

Following is the deposit composition as a percentage of total deposits and a breakdown of cost of deposits as of and for the quarters ended September 30, 2022, June 30, 2022 and September 30, 2021:

	Deposit Breakdown						Cost of Deposits
(unaudited)	9/30/2022		6/30/2022		9/30/2021		Q3 2022		Q2 2022		Q3 2021
Noninterest bearing demand deposits	36.1	%	37.9	%	39.9	%	—	%	—	%	—	%
Money market and other	38.0	%	42.2	%	39.0	%	1.24	%	0.54	%	0.40	%
Saving deposits	2.0	%	2.1	%	2.1	%	1.18	%	1.16	%	1.18	%
Time deposits	23.9	%	17.8	%	19.0	%	1.27	%	0.46	%	0.38	%
Total deposit balances	100.0	%	100.0	%	100.0	%	0.79	%	0.33	%	0.26	%

Allowance for Credit Losses

For the 2022 third quarter, the Company recorded a provision for credit losses of $9.2 million, compared with a provision for credit losses of $3.2 million in the preceding second quarter and a negative provision for credit losses of $10.0 million in the 2021 third quarter.

Following is the allowance for credit losses and allowance coverage ratios as of September 30, 2022, June 30, 2022 and September 30, 2021:

(dollars in thousands) (unaudited)	9/30/2022			6/30/2022			9/30/2021
Allowance for credit losses	$	160,561		$	151,580		$	136,774
Allowance for credit loss/loans receivable		1.04	%		1.04	%		1.02	%
Allowance for credit losses/nonperforming loans		168.11	%		139.63	%		138.92	%

Credit Quality

Following are the components of nonperforming assets as of September 30, 2022, June 30, 2022 and September 30, 2021:

(dollars in thousands) (unaudited)	9/30/2022		6/30/2022		9/30/2021
Loans on nonaccrual status ⁽¹⁾	$	64,571	$	69,522	$	54,380
Delinquent loans 90 days or more on accrual status		5,306		12,468		4,567
Accruing troubled debt restructured loans		25,631		26,572		39,509
Total nonperforming loans		95,508		108,562		98,456
Other real estate owned		1,480		2,010		15,213
Total nonperforming assets	$	96,988	$	110,572	$	113,669

⁽¹⁾

Excludes delinquent SBA loans that are guaranteed and currently in liquidation totaling $9.9 million, $13.2 million and $20.6 million, at September 30, 2022, June 30, 2022 and September 30, 2021, respectively.

Total nonperforming assets at September 30, 2022 decreased to $97.0 million from $110.6 million at June 30, 2022 and from $113.7 million at September 30, 2021. Quarter-over-quarter, the decrease in total nonperforming assets reflects reductions across the board in all categories.

Following are net charge offs (recoveries) and net charge offs (recoveries) to average loans receivable on an annualized basis for the three months ended September 30, 2022, June 30, 2022 and September 30, 2021:

	For the Three Months Ended
(dollars in thousands) (unaudited)	9/30/2022			6/30/2022			9/30/2021
Net charge offs (recoveries)	$	219		$	(930	)	$	42,678
Net charge offs (recoveries)/average loans receivable (annualized)		0.01	%		(0.03	)%		1.28	%

Following are the components of criticized loan balances as of September 30, 2022, June 30, 2022 and September 30, 2021:

(dollars in thousands) (unaudited)	9/30/2022		6/30/2022		9/30/2021
Special mention	$	79,399	$	95,797	$	306,766
Substandard		204,713		244,748		243,684
Total criticized loans	$	284,112	$	340,545	$	550,450

At September 30, 2022, special mention loans decreased 17.1% quarter-over-quarter and total criticized loans decreased 16.6% quarter-over-quarter. Compared with a year ago at September 30, 2021, special mention and total criticized loans decreased 74.1% and 48.4%, respectively.

Capital

At September 30, 2022, the Company and the Bank continued to exceed all regulatory capital requirements generally required to meet the definition of a "well-capitalized" financial institution. Following are capital ratios for the Company as of September 30, 2022, June 30, 2022 and September 30, 2021:

(unaudited)	9/30/2022		6/30/2022		9/30/2021		Minimum Guideline for "Well-Capitalized" Bank
Common Equity Tier 1 Capital	10.32	%	10.69	%	11.01	%	6.50	%
Tier 1 Leverage Ratio	10.25	%	10.32	%	9.98	%	5.00	%
Tier 1 Risk-Based Ratio	10.91	%	11.33	%	11.70	%	8.00	%
Total Risk-Based Ratio	11.72	%	12.13	%	12.42	%	10.00	%

Following are tangible common equity ("TCE") per share and TCE as a percentage of tangible assets as of September 30, 2022, June 30, 2022 and September 30, 2021:

(unaudited)	9/30/2022			6/30/2022			9/30/2021
Tangible common equity per share ⁽¹⁾	$	12.60		$	12.80		$	13.33
Tangible common equity to tangible assets ⁽¹⁾		8.09	%		8.68	%		9.24	%

⁽¹⁾

Tangible common equity represents common equity less goodwill and net other intangible assets. Tangible common equity per share represents tangible common equity divided by the number of shares issued and outstanding. Tangible assets represent total assets less goodwill and net other intangible assets. Tangible common equity to tangible assets is the ratio of tangible common equity over tangible assets. Tangible common equity, tangible common equity per share, tangible assets and tangible common equity to tangible assets are non-GAAP financial measures. Management's reasons and purposes for using these non-GAAP financial measures are set forth in the following section. A quantitative reconciliation of the GAAP to non-GAAP financial measures is provided in the accompanying financial information on Table Pages 10 and 11.

Non-GAAP Financial Metrics

This news release contains certain non-GAAP financial measure disclosures, including pre-provision net revenue, ROA (PPNR), ROE (PPNR), tangible common equity, tangible common equity per share, tangible assets and tangible common equity to tangible assets. Management believes these non-GAAP financial measures provide meaningful supplemental information regarding its operational performance and the Company's and the Bank's capital levels and has included these figures in response to market participant interest in these financial metrics. A reconciliation of the GAAP to non-GAAP financial measures is provided in the accompanying financial information on Table Pages 10 and 11.

Investor Conference Call

The Company previously announced that it will host an investor conference call on Tuesday, October 25, 2022 at 9:30 a.m. Pacific Time / 12:30 p.m. Eastern Time to review financial results for its third quarter ended September 30, 2022. Investors and analysts are invited to access the conference call by dialing 866-235-9917 (domestic) or 412-902-4103 (international) and asking for the "Hope Bancorp Call." A presentation to accompany the earnings call will be available at the Investor Relations section of Hope Bancorp's website at www.ir-hopebancorp.com. Other interested parties are invited to listen to a live webcast of the call available at the Investor Relations section of Hope Bancorp's website. After the live webcast, a replay will remain available at the Investor Relations section of Hope Bancorp's website for one year. A telephonic replay of the call will be available at 877-344-7529 (domestic) or 412-317-0088 (international) for one week through November 1, 2022, replay access code 7421375.

About Hope Bancorp, Inc.

Hope Bancorp, Inc. is the holding company of Bank of Hope, the first and only super regional Korean American bank in the United States with $19.08 billion in total assets as of September 30, 2022. Headquartered in Los Angeles and serving a multi-ethnic population of customers across the nation, Bank of Hope operates 54 full-service branches in California, Washington, Texas, Illinois, New York, New Jersey, Virginia, Alabama and Georgia. The Bank also operates SBA loan production offices in Seattle, Denver, Dallas, Atlanta, Portland, New York City, Northern California and Houston; commercial loan production offices in Northern California and Seattle; residential mortgage loan production offices in Southern California; and a representative office in Seoul, Korea. Bank of Hope specializes in core business banking products for small and medium-sized businesses, with an emphasis in commercial real estate and commercial lending, SBA lending and international trade financing. Bank of Hope is a California-chartered bank, and its deposits are insured by the FDIC to the extent provided by law. Bank of Hope is an Equal Opportunity Lender. For additional information, please go to bankofhope.com. By including the foregoing website address link, the Company does not intend to and shall not be deemed to incorporate by reference any material contained or accessible therein.

Forward-Looking Statements

Some statements in this news release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements relate to, among other things, expectations regarding the business environment in which we operate, projections of future performance, perceived opportunities in the market and statements regarding our business strategies, objectives and vision. Forward-looking statements include, but are not limited to, statements preceded by, followed by or that include the words "will," "believes," "expects," "anticipates," "intends," "plans," "estimates" or similar expressions. With respect to any such forward-looking statements, the Company claims the protection provided for in the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties. The Company's actual results, performance or achievements may differ significantly from the results, performance or achievements expressed or implied in any forward-looking statements. The risks and uncertainties include, but are not limited to: possible deterioration in economic conditions in our areas of operation; interest rate risk associated with volatile interest rates and related asset-liability matching risk; liquidity risks; risk of significant non-earning assets, and net credit losses that could occur, particularly in times of weak economic conditions or times of rising interest rates; the failure of or changes to assumptions and estimates underlying the Company's allowances for credit losses, regulatory risks associated with current and future regulations; and the COVID-19 pandemic and its impact on our financial position, results of operations, liquidity, and capitalization. For additional information concerning these and other risk factors, see the Company's most recent Annual Report on Form 10-K. The Company does not undertake, and specifically disclaims any obligation, to update any forward-looking statements to reflect the occurrence of events or circumstances after the date of such statements except as required by law.

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands, except share and per share data)


Assets:	9/30/2022			6/30/2022			% change		9/30/2021			% change
Cash and due from banks	$	331,336		$	197,062		68	%	$	627,352		(47	)%
Investment securities		2,264,533			2,352,997		(4	)%		2,669,489		(15	)%
Federal Home Loan Bank ("FHLB") stock and other investments		65,192			87,109		(25	)%		88,102		(26	)%
Loans held for sale, at the lower of cost or fair value		41,989			76,376		(45	)%		179,117		(77	)%
Loans receivable		15,491,187			14,546,049		6	%		13,418,691		15	%
Allowance for credit losses		(160,561	)		(151,580	)	6	%		(136,774	)	17	%
Net loans receivable		15,330,626			14,394,469		7	%		13,281,917		15	%
Accrued interest receivable		42,363			37,845		12	%		47,102		(10	)%
Premises and equipment, net		46,169			46,093		—	%		45,307		2	%
Bank owned life insurance		76,788			77,692		(1	)%		76,756		—	%
Goodwill		464,450			464,450		—	%		464,450		—	%
Servicing assets		11,601			11,215		3	%		10,787		8	%
Other intangible assets, net		6,212			6,698		(7	)%		8,180		(24	)%
Other assets		402,129			337,056		19	%		300,467		34	%
Total assets	$	19,083,388		$	18,089,062		5	%	$	17,799,026		7	%

Liabilities:
Deposits	$	15,502,209		$	15,029,630		3	%	$	15,062,527		3	%
FHLB and FRB borrowings		1,072,000			573,000		87	%		200,000		436	%
Convertible notes, net		216,913			216,678		—	%		215,974		—	%
Subordinated debentures		106,258			105,953		—	%		105,057		1	%
Accrued interest payable		11,713			4,112		185	%		5,367		118	%
Other liabilities		198,570			159,320		25	%		135,703		46	%
Total liabilities	$	17,107,663		$	16,088,693		6	%	$	15,724,628		9	%

Stockholders' Equity:
Common stock, $0.001 par value	$	137		$	137		—	%	$	136		1	%
Capital surplus		1,428,052			1,424,891		—	%		1,420,151		1	%
Retained earnings		1,048,738			1,011,715		4	%		897,766		17	%
Treasury stock, at cost		(264,667	)		(264,667	)	—	%		(247,198	)	(7	)%
Accumulated other comprehensive (loss) gain, net		(236,535	)		(171,707	)	(38	)%		3,543		N/A
Total stockholders' equity		1,975,725			2,000,369		(1	)%		2,074,398		(5	)%
Total liabilities and stockholders' equity	$	19,083,388		$	18,089,062		5	%	$	17,799,026		7	%

Common stock shares - authorized		150,000,000			150,000,000					150,000,000
Common stock shares - outstanding		119,479,253			119,473,939					120,198,061
Treasury stock shares		17,382,835			17,382,835					16,149,007

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands, except share and per share data)


	Three Months Ended												Nine Months Ended
	9/30/2022		6/30/2022			% change		9/30/2021			% change		9/30/2022			9/30/2021			% change

Interest and fees on loans	$	175,078	$	145,024		21	%	$	132,794		32	%	$	452,774		$	394,353		15	%
Interest on investment securities		13,498		12,308		10	%		9,207		47	%		37,462			24,835		51	%
Interest on federal funds sold and other investments		606		492		23	%		865		(30	)%		1,642			2,175		(25	)%
Total interest income		189,182		157,824		20	%		142,866		32	%		491,878			421,363		17	%

Interest on deposits		30,667		12,220		151	%		9,640		218	%		51,563			33,106		56	%
Interest on other borrowings and convertible notes		5,329		4,066		31	%		2,930		82	%		12,415			8,805		41	%
Total interest expense		35,996		16,286		121	%		12,570		186	%		63,978			41,911		53	%

Net interest income before provision (credit) for credit losses		153,186		141,538		8	%		130,296		18	%		427,900			379,452		13	%
Provision (credit) for credit losses		9,200		3,200		188	%		(10,000	)	N/A			1,400			(13,700	)	N/A
Net interest income after provision (credit) for credit losses		143,986		138,338		4	%		140,296		3	%		426,500			393,152		8	%

Service fees on deposit accounts		2,535		2,270		12	%		1,814		40	%		6,779			5,381		26	%
International service fees		834		744		12	%		889		(6	)%		2,372			2,525		(6	)%
Loan servicing fees, net		981		843		16	%		642		53	%		2,660			2,620		2	%
Wire transfer fees		856		858		—	%		836		2	%		2,614			2,603		—	%
Net gains on sales of SBA loans		2,782		5,804		(52	)%		2,459		13	%		14,189			4,834		194	%
Net gains on sales of residential mortgage loans		29		76		(62	)%		781		(96	)%		862			3,905		(78	)%
Net gains (losses) on sales of other loans		117		(547	)	N/A			—		100	%		(430	)		—		100	%
Other income and fees		5,221		2,698		94	%		3,196		63	%		10,241			8,629		19	%
Total noninterest income		13,355		12,746		5	%		10,617		26	%		39,287			30,497		29	%

Salaries and employee benefits		53,222		51,058		4	%		47,018		13	%		152,025			130,543		16	%
Occupancy		6,682		7,178		(7	)%		7,473		(11	)%		21,195			21,507		(1	)%
Furniture and equipment		4,967		4,778		4	%		4,429		12	%		14,389			13,437		7	%
Advertising and marketing		1,739		2,226		(22	)%		2,656		(35	)%		5,601			6,378		(12	)%
Data processing and communications		2,469		2,893		(15	)%		2,394		3	%		7,823			7,542		4	%
Professional fees		1,196		1,582		(24	)%		2,431		(51	)%		4,989			9,729		(49	)%
FDIC assessment		1,633		1,450		13	%		1,204		36	%		4,652			3,743		24	%
Credit related expenses		873		2,872		(70	)%		1,266		(31	)%		4,857			3,527		38	%
OREO expense		378		5		7,460	%		248		52	%		740			827		(11	)%
Software impairment		—		—		—	%		—		—	%		—			2,146		(100	)%
Other		10,755		6,323		70	%		6,383		68	%		23,381			19,677		19	%
Total noninterest expense		83,914		80,365		4	%		75,502		11	%		239,652			219,056		9	%
Income before income taxes		73,427		70,719		4	%		75,411		(3	)%		226,135			204,593		11	%
Income tax provision		19,679		18,631		6	%		19,912		(1	)%		59,561			51,644		15	%
Net income	$	53,748	$	52,088		3	%	$	55,499		(3	)%	$	166,574		$	152,949		9	%

Earnings Per Common Share - Basic	$	0.45	$	0.43				$	0.45				$	1.39		$	1.24
Earnings Per Common Share - Diluted	$	0.45	$	0.43				$	0.45				$	1.38		$	1.23

Weighted Average Shares Outstanding - Basic		119,476,035		120,219,919					122,244,948					119,940,044			123,050,174
Weighted Average Shares Outstanding - Diluted		119,996,523		120,699,638					122,908,536					120,595,988			123,848,512

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands, except share and per share data)


	For the Three Months Ended (Annualized)						For the Nine Months Ended (Annualized)
Profitability measures:	9/30/2022		6/30/2022		9/30/2021		9/30/2022		9/30/2021
ROA	1.17	%	1.17	%	1.25	%	1.23	%	1.18	%
ROE	10.58	%	10.33	%	10.61	%	10.85	%	9.86	%
ROA (PPNR) ⁽¹⁾	1.79	%	1.65	%	1.47	%	1.68	%	1.47	%
ROE (PPNR) ⁽¹⁾	16.26	%	14.66	%	12.51	%	14.83	%	12.30	%
ROTCE ⁽²⁾	13.77	%	13.48	%	13.71	%	14.10	%	12.78	%
Net interest margin	3.49	%	3.36	%	3.07	%	3.36	%	3.08	%
Efficiency ratio	50.39	%	52.09	%	53.58	%	51.30	%	53.43	%
Noninterest expense / average assets	1.82	%	1.80	%	1.70	%	1.77	%	1.68	%

⁽¹⁾		ROA (PPNR) and ROE (PPNR) are non-GAAP financial measures. Management's reasons and purposes for using these non-GAAP financial measures are set forth on Table Pages 10 and 11 of this earnings release. A quantitative reconciliation of the Company's GAAP to non-GAAP financial measures are provided in the accompanying financial information on Table Pages 10 and 11.
⁽²⁾		Average tangible common equity is calculated by subtracting average goodwill and average core deposit intangible assets from average stockholders' equity. This is a non-GAAP measure that we believe provides investors with information that is useful in understanding our financial performance and position.

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands, except share and per share data)

	Three Months Ended
	9/30/2022						6/30/2022						9/30/2021
			Interest		Annualized				Interest		Annualized				Interest		Annualized
	Average		Income/		Average		Average		Income/		Average		Average		Income/		Average
	Balance		Expense		Yield/Cost		Balance		Expense		Yield/Cost		Balance		Expense		Yield/Cost
INTEREST EARNING ASSETS:
Loans, including loans held for sale	$	14,925,298	$	175,078	4.65	%	$	14,327,476	$	145,024	4.06	%	$	13,286,382	$	132,794	3.97	%
Investment securities		2,366,696		13,498	2.26	%		2,424,454		12,308	2.04	%		2,370,672		9,207	1.54	%
FHLB stock and other investments		107,724		606	2.23	%		134,055		492	1.47	%		1,197,537		865	0.29	%
Total interest earning assets	$	17,399,718	$	189,182	4.31	%	$	16,885,985	$	157,824	3.75	%	$	16,854,591	$	142,866	3.36	%

INTEREST BEARING LIABILITIES:
Deposits:
Demand, interest bearing	$	6,255,271	$	19,614	1.24	%	$	6,487,890	$	8,655	0.54	%	$	5,919,225	$	5,946	0.40	%
Savings		324,487		969	1.18	%		323,114		937	1.16	%		310,525		920	1.18	%
Time deposits		3,146,432		10,084	1.27	%		2,277,938		2,628	0.46	%		2,914,977		2,774	0.38	%
Total interest bearing deposits		9,726,190		30,667	1.25	%		9,088,942		12,220	0.54	%		9,144,727		9,640	0.42	%
FHLB and FRB borrowings		448,837		2,393	2.12	%		577,966		1,457	1.01	%		200,000		640	1.27	%
Convertible notes, net		216,762		1,322	2.39	%		216,540		1,322	2.42	%		215,840		1,321	2.39	%
Subordinated debentures		102,182		1,614	6.18	%		101,880		1,287	5.00	%		100,993		969	3.75	%
Total interest bearing liabilities	$	10,493,971	$	35,996	1.36	%	$	9,985,328	$	16,286	0.65	%	$	9,661,560	$	12,570	0.52	%
Noninterest bearing demand deposits		5,719,155						5,715,830						5,848,983
Total funding liabilities/cost of funds	$	16,213,126			0.88	%	$	15,701,158			0.42	%	$	15,510,543			0.32	%
Net interest income/net interest spread			$	153,186	2.95	%			$	141,538	3.10	%			$	130,296	2.84	%
Net interest margin					3.49	%					3.36	%					3.07	%

Cost of deposits:
Noninterest bearing demand deposits	$	5,719,155	$	—	—	%	$	5,715,830	$	—	—	%	$	5,848,983	$	—	—	%
Interest bearing deposits		9,726,190		30,667	1.25	%		9,088,942		12,220	0.54	%		9,144,727		9,640	0.42	%
Total deposits	$	15,445,345	$	30,667	0.79	%	$	14,804,772	$	12,220	0.33	%	$	14,993,710	$	9,640	0.26	%

Hope Bancorp, Inc.

Selected Financial Data

Unaudited (dollars in thousands, except share and per share data)

Nine Months Ended

9/30/2022

9/30/2021

Interest

Annualized

Interest

Annualized

Average

Income/

Average

Income/

Average

Balance

Expense

Yield/Cost

Balance

Expense

Yield/Cost

INTEREST EARNING ASSETS:

Loans, including loans held for sale

14,378,774

452,774

4.21

13,308,526

Hope Bancorp Reports 2022 Third Quarter Financial Results