Hope Bancorp, Inc. (the "Company") (NASDAQ:HOPE), the holding company of Bank of Hope (the "Bank"), today reported unaudited financial results for its second quarter and six months ended June 30, 2023.

For the three months ended June 30, 2023, net income totaled $38.0 million, or $0.32 per diluted common share. This compares with net income of $39.1 million, or $0.33 per diluted common share, in the preceding first quarter. Pre-provision net revenue ("PPNR")⁽¹⁾ for the 2023 second quarter totaled $60.4 million, up 11% from $54.5 million in the preceding first quarter.

"Throughout the second quarter, we continued to maintain high levels of capital and liquidity to prudently navigate an operating environment that is challenging for regional banks," said Kevin S. Kim, Chairman, President and Chief Executive Officer. "Year-over-year, our total capital ratio increased 51 basis points to 12.64% at June 30, 2023. At the end of the 2023 second quarter, our tangible common equity ratio⁽¹⁾ was a robust 8.04%.

"Our asset quality remains healthy. We recorded net recoveries of $552 thousand for the 2023 second quarter, and nonperforming assets decreased 30% year-over-year. We have steadily built our allowance for credit losses, with coverage at 1.16% of loans receivable at June 30, 2023.

"Year-over-year, our loans receivable grew 2% to $14.9 billion, and our total deposits grew 4% to $15.6 billion at June 30, 2023. With Bank of Hope's strong balance sheet and continued investment in enhancing our products and services, we are focused on expanding our relationships with our customers and strengthening our market leadership in the Korean American community and beyond," said Kim.

Q2 2023 Highlights

Capital growth. Total capital was $2.10 billion at June 30, 2023, growing 2% from March 31, 2023. The total capital ratio increased 39 basis points quarter-over-quarter to 12.64% at June 30, 2023. Book value per common share at June 30, 2023, was $17.23, and tangible common equity ("TCE") per share⁽¹⁾ was $13.32, up 0.3% and 0.5%, respectively, quarter-over-quarter. The TCE ratio of 8.04% as of June 30, 2023, expanded 13 basis points from March 31, 2023.
Strong liquidity. Cash and cash equivalents increased to $2.30 billion at June 30, 2023, up from $2.21 billion at March 31, 2023. Available borrowing capacity, together with cash and cash equivalents and unpledged investment securities, totaled $7.75 billion, equivalent to 50% of total deposits at June 30, 2023.
Healthy asset quality. Nonperforming assets declined 3% quarter-over-quarter. The nonperforming assets ratio improved to 0.38% of total assets at June 30, 2023, down from 0.39% at March 31, 2023. The Company recorded net recoveries of $552 thousand during the 2023 second quarter, equivalent to 0.01% annualized of average loans.
Total deposits of $15.62 billion at June 30, 2023, decreased 1% quarter-over-quarter and grew 4% year-over-year. Uninsured deposits at June 30, 2023, represented 36% of the Bank's deposits, compared with 38% at March 31, 2023.
Loans receivable of $14.86 billion at June 30, 2023, decreased 1% quarter-over-quarter and grew 2% year-over-year.
Efficiency improvement. The efficiency ratio for the 2023 second quarter improved 325 basis points to 59.1% from 62.4% for the preceding first quarter.
PPNR increase. PPNR for the 2023 second quarter totaled $60.4 million, up 11% from $54.5 million in the preceding first quarter.

(1)

PPNR, TCE ratio, and TCE per share are non-GAAP financial measures. Quantitative reconciliations of the most directly comparable GAAP to non-GAAP financial measures are provided in the accompanying financial information on Table Page 10.

Financial Summary

	At or for the Three Months Ended
(dollars in thousands, except per share data) (unaudited)	6/30/2023			3/31/2023			6/30/2022
Net income	$	38,022		$	39,121		$	52,088
Diluted earnings per share	$	0.32		$	0.33		$	0.43
Net interest income before provision for credit losses	$	130,689		$	133,878		$	141,538
Pre-provision net revenue ("PPNR") ⁽¹⁾	$	60,370		$	54,502		$	73,919
Loans receivable	$	14,864,810		$	15,064,849		$	14,546,049
Deposits	$	15,619,352		$	15,828,209		$	15,029,630
Total assets	$	20,366,138		$	20,568,884		$	18,089,062
Total equity	$	2,067,998		$	2,058,580		$	2,000,369
Total capital ratio		12.64	%		12.25	%		12.13	%
Tangible common equity ("TCE") ratio⁽¹⁾		8.04	%		7.91	%		8.68	%
Net recoveries (charge offs)	$	552		$	(108	)	$	930
Net recoveries/average loans receivable⁽²⁾		0.01	%		—	%		0.03	%
Allowance for credit losses	$	172,996		$	163,544		$	151,580
Allowance for credit losses to loans receivable		1.16	%		1.09	%		1.04	%
Nonperforming assets to total assets⁽³⁾		0.38	%		0.39	%		0.61	%
Return on average assets ("ROA")⁽²⁾		0.74	%		0.82	%		1.17	%
Return on average equity ("ROE")⁽²⁾		7.34	%		7.65	%		10.33	%
Return on average TCE ("ROTCE")^{(1) (2)}		9.49	%		9.93	%		13.48	%
ROA (PPNR)^{(1) (2)}		1.18	%		1.14	%		1.65	%
ROE (PPNR)^{(1) (2)}		11.65	%		10.65	%		14.66	%
Net interest margin⁽²⁾		2.70	%		3.02	%		3.36	%
Noninterest expense / average assets⁽²⁾		1.71	%		1.89	%		1.80	%
Efficiency ratio		59.13	%		62.38	%		52.09	%

__________________

(1)		PPNR, TCE ratio, ROTCE, ROA (PPNR), and ROE (PPNR) are non-GAAP financial measures. Quantitative reconciliations of the most directly comparable GAAP to non-GAAP financial measures are provided in the accompanying financial information on Table Page 10.
(2)		Annualized.
(3)		Excludes delinquent Small Business Administration ("SBA") loans that are guaranteed and currently in liquidation.

Operating Results for the 2023 Second Quarter

Net interest income. Net interest income before provision for credit losses for the 2023 second quarter totaled $130.7 million, a decrease of 2% compared with $133.9 million in the preceding first quarter. 2023 second quarter interest income of $267.2 million increased $30.5 million quarter-over-quarter, driven by growth in average interest earning cash and deposits at other banks, as well as expanding loan yields. This was offset by higher interest expense, which increased $33.7 million quarter-over-quarter, reflecting a higher cost of interest bearing deposits and a higher volume of average borrowings.

The net interest margin for the 2023 second quarter decreased 32 basis points to 2.70%, from 3.02% in the preceding first quarter, primarily reflecting a higher cost of funds and an increase in average borrowings, partially offset by loan yield expansion and growth in average interest earning cash and deposits at other banks.

The weighted average yield on loans for the 2023 second quarter was 5.99%, up 24 basis points from 5.75% in the preceding first quarter. This reflected increases in market interest rates and a significant increase in the average rate on new loans. The average rate on new loans originated in the 2023 second quarter was 8.37%, up 84 basis points quarter-over-quarter.

The weighted average cost of total deposits for the 2023 second quarter was 2.79%, up 42 basis points from 2.37% in the preceding first quarter, reflecting higher rates paid on interest bearing deposit accounts.

Noninterest income. Noninterest income for the 2023 second quarter totaled $17.0 million, up 55% from $11.0 million in the preceding first quarter. Other income and fees for the 2023 second quarter included a $5.8 million cash distribution from a gain on an investment in an affordable housing partnership. During the 2023 second quarter, the Company sold $38.4 million of the guaranteed portion of SBA 7(a) loans and $6.6 million of residential mortgage loans, for a gain on loan sales of $2.0 million, compared with $40.7 million and $7.3 million, respectively, sold in the preceding first quarter for a gain on loan sales of $2.3 million.

Noninterest expense. Noninterest expense for the 2023 second quarter decreased 3% to $87.3 million, down from $90.4 million in the preceding first quarter. The quarter-over-quarter change was primarily driven by lower salaries and employee benefits expense, partially offset by the impact of an industry-wide increase in the FDIC assessment rate of two basis points.

The Company's efficiency ratio for the 2023 second quarter improved to 59.1% from 62.4% in the preceding first quarter. Annualized noninterest expense as a percentage of average assets was 1.71% for the 2023 second quarter, down from 1.89% for the 2023 first quarter.

Tax rate. The effective tax rate for the 2023 second quarter was 26.1%, compared with 25.9% for the preceding first quarter. The year-to-date effective tax rate for the first six months of 2023 was 26.0%.

Balance Sheet Summary

Loans. New loan originations for the 2023 second quarter totaled $490.6 million, compared with $568.7 million for the preceding first quarter. The following table sets forth the components of new loan production for the quarters ended June 30, 2023, March 31, 2023, and June 30, 2022.

	For the Three Months Ended
(dollars in thousands) (unaudited)	6/30/2023		3/31/2023		6/30/2022
Commercial real estate ("CRE") loans	$	115,444	$	176,798	$	522,093
Commercial and industrial ("C&I") loans		318,063		344,194		544,639
SBA loans		38,051		29,977		35,085
Residential mortgage loans		18,736		14,317		181,408
Other loans		280		3,375		2,770
Total new loan originations	$	490,574	$	568,661	$	1,285,995

At June 30, 2023, loans receivable decreased 1% quarter-over-quarter to $14.86 billion from $15.06 billion at March 31, 2023. Year-over-year, loans receivable grew 2%, up from $14.55 billion at June 30, 2022. The following table sets forth the loan portfolio composition and percentage of total loans at June 30, 2023, March 31, 2023, and June 30, 2022:

(dollars in thousands) (unaudited)	6/30/2023				3/31/2023				6/30/2022
	Balance		Percentage		Balance		Percentage		Balance		Percentage
C&I loans	$	4,805,126	32.3	%	$	4,821,270	32.0	%	$	4,395,738	30.2	%
CRE loans		9,192,160	61.9	%		9,373,529	62.2	%		9,335,020	64.2	%
Residential mortgage and other loans		867,524	5.8	%		870,050	5.8	%		815,291	5.6	%
Loans receivable	$	14,864,810	100.0	%	$	15,064,849	100.0	%	$	14,546,049	100.0	%

Deposits. At June 30, 2023, total deposits decreased 1% to $15.62 billion from $15.83 billion at March 31, 2023. Year-over-year, total deposits grew 4%, up from $15.03 billion at June 30, 2022. The following table sets forth the deposit composition and percentage of total deposits at June 30, 2023, March 31, 2023, and June 30, 2022:

(dollars in thousands) (unaudited)	6/30/2023				3/31/2023				6/30/2022
	Balance		Percentage		Balance		Percentage		Balance		Percentage
Noninterest bearing demand deposits	$	4,229,247	27.1	%	$	4,504,621	28.4	%	$	5,689,992	37.9	%
Money market and interest bearing demand deposits		4,188,584	26.8	%		4,331,998	27.4	%		6,339,467	42.2	%
Savings deposits		224,495	1.4	%		231,704	1.5	%		326,927	2.1	%
Time deposits		6,977,026	44.7	%		6,759,886	42.7	%		2,673,244	17.8	%
Total deposits	$	15,619,352	100.0	%	$	15,828,209	100.0	%	$	15,029,630	100.0	%

Liquidity. At June 30, 2023, cash and cash equivalents increased to $2.30 billion from $2.21 billion at March 31, 2023, and up from $0.20 billion at June 30, 2022. Available borrowing capacity, cash and cash equivalents, and unpledged investment securities totaled $7.75 billion, equivalent to 50% of total deposits at June 30, 2023, and well exceeding the Bank's uninsured deposit balances.

Borrowings and Convertible Notes. Federal Home Loan Bank and Federal Reserve Bank borrowings were $2.26 billion at June 30, 2023, compared with $2.13 billion at March 31, 2023, and $0.57 billion at June 30, 2022. At the expiration of the Optional Put for the holders of the Company's 2% Convertible Senior Notes due 2038, $197 million of the principal amount was paid off on May 15, 2023, with existing cash.

Allowance for Credit Losses

For the 2023 second quarter, the Company recorded a provision for credit losses of $8.9 million, compared with $1.7 million in the preceding first quarter, building its allowance for credit losses. The allowance for credit losses increased to $173.0 million at June 30, 2023, up from $163.5 million at March 31, 2023. The allowance coverage ratio increased to 1.16% of loans receivable at June 30, 2023, up from 1.09% a quarter ago.

The following table sets forth the allowance for credit losses and allowance coverage ratios at June 30, 2023, March 31, 2023, and June 30, 2022:

(dollars in thousands) (unaudited)	6/30/2023			3/31/2023			6/30/2022
Allowance for credit losses	$	172,996		$	163,544		$	151,580
Allowance for credit losses/loans receivable		1.16	%		1.09	%		1.04	%

Credit Quality

Asset quality continued to be healthy. The Company recorded net recoveries of $552 thousand in the 2023 second quarter, representing an annualized net recovery ratio of 0.01% of average loans. The following table sets forth net recoveries (charge offs) and net recoveries to average loans receivable, annualized, for the three months ended June 30, 2023, March 31, 2023, and June 30, 2022:

	For the Three Months Ended
(dollars in thousands) (unaudited)	6/30/2023			3/31/2023			6/30/2022
Net recoveries (charge offs)	$	552		$	(108	)	$	930
Net recoveries/average loans receivable (annualized)		0.01	%		—	%		0.03	%

Nonperforming assets. Nonperforming assets totaled $77.4 million at June 30, 2023, a decrease of 3% quarter-over-quarter, and a decrease of 30% year-over-year. The nonperforming assets ratio improved to 0.38% of total assets at June 30, 2023, down from 0.39% at March 31, 2023, and down from 0.61% at June 30, 2022. Nonperforming loans decreased 4% quarter-over-quarter to $76.4 million at June 30, 2023, down from $79.2 million at March 31, 2023, and decreased 30% year-over-year from $108.6 million at June 30, 2022.

The following table sets forth the components of nonperforming assets at June 30, 2023, March 31, 2023, and June 30, 2022:

(dollars in thousands) (unaudited)	6/30/2023			3/31/2023			6/30/2022
Loans on nonaccrual status ⁽¹⁾	$	61,252		$	78,861		$	69,522
Accruing delinquent loans past due 90 days or more		15,182			364			12,468
Accruing troubled debt restructured loans⁽²⁾		—			—			26,572
Total nonperforming loans		76,434			79,225			108,562
Other real estate owned		938			938			2,010
Total nonperforming assets	$	77,372		$	80,163		$	110,572

Nonperforming assets/total assets		0.38	%		0.39	%		0.61	%

__________________

(1)		Excludes delinquent SBA loans that are guaranteed and currently in liquidation totaling $11.9 million, $7.6 million and $13.2 million at June 30, 2023, March 31, 2023, and June 30, 2022, respectively.
(2)		The Company adopted ASU 2022-02 in 2023, which eliminated the concept of troubled debt restructured ("TDR") loans from GAAP; therefore, accruing TDR loans are no longer included in nonperforming loans.

Criticized loans. Total criticized loans were $345.0 million at June 30, 2023, compared with $304.7 million at March 31, 2023, and $340.5 million at June 30, 2022.

Capital

The Company's capital ratios remained strong. At June 30, 2023, the Company and the Bank continued to exceed all regulatory capital requirements generally required to meet the definition of a "well-capitalized" financial institution. The following table sets forth the capital ratios for the Company at June 30, 2023, March 31, 2023, and June 30, 2022:

(unaudited)	6/30/2023	3/31/2023	6/30/2022	Minimum Guideline for "Well-Capitalized"
Common Equity Tier 1 Capital Ratio	11.06%	10.75%	10.69%	6.50%
Tier 1 Capital Ratio	11.68%	11.36%	11.33%	8.00%
Total Capital Ratio	12.64%	12.25%	12.13%	10.00%
Leverage Ratio	9.57%	10.13%	10.32%	5.00%

The following table sets forth the TCE per share and the TCE ratio at June 30, 2023, March 31, 2023, and June 30, 2022:

(unaudited)	6/30/2023	3/31/2023	6/30/2022
TCE per share ⁽¹⁾	$13.32	$13.26	$12.80
TCE ratio ⁽¹⁾	8.04%	7.91%	8.68%

__________________

(1)

TCE per share and TCE ratio are non-GAAP financial measures. Quantitative reconciliations of the most directly comparable GAAP to non-GAAP financial measures are provided in the accompanying financial information on Table Page 10.

Investor Conference Call

The Company previously announced that it will host an investor conference call on Monday, July 24, 2023 at 9:30 a.m. Pacific Time / 12:30 p.m. Eastern Time to review unaudited financial results for its second quarter ended June 30, 2023. 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 July 31, 2023, replay access code 8610354.

Non-GAAP Financial Metrics

This news release contains certain non-GAAP financial measure disclosures, including PPNR, TCE per share, TCE ratio, ROTCE, ROA (PPNR), and ROE (PPNR). Management believes these non-GAAP financial measures provide meaningful supplemental information regarding the Company's operational performance and the Company's capital levels and has included these figures in response to market participant interest in these financial metrics. Quantitative reconciliations of the most directly comparable GAAP to non-GAAP financial measures are provided in the accompanying financial information on Table Page 10.

About Hope Bancorp, Inc.

Hope Bancorp, Inc. (NASDAQ:HOPE) is the holding company of Bank of Hope, the first and only super regional Korean American bank in the United States with $20.37 billion in total assets as of June 30, 2023. Headquartered in Los Angeles and serving a multi-ethnic population of customers across the nation, Bank of Hope operates 53 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, Seattle and Tampa, Fla.; 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 lending, commercial and industrial 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 further 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 data)

Assets:	6/30/2023			3/31/2023			% change		6/30/2022			% change
Cash and due from banks	$	2,302,339		$	2,212,637		4	%	$	197,062		1,068	%
Investment securities		2,186,346			2,231,989		(2	)%		2,352,997		(7	)%
Federal Home Loan Bank ("FHLB") stock and other investments		60,213			59,962		—	%		87,109		(31	)%
Loans held for sale, at the lower of cost or fair value		49,246			125,268		(61	)%		76,376		(36	)%
Loans receivable		14,864,810			15,064,849		(1	)%		14,546,049		2	%
Allowance for credit losses		(172,996	)		(163,544	)	6	%		(151,580	)	14	%
Net loans receivable		14,691,814			14,901,305		(1	)%		14,394,469		2	%
Accrued interest receivable		60,118			57,021		5	%		37,845		59	%
Premises and equipment, net		50,513			47,887		5	%		46,093		10	%
Bank owned life insurance		88,238			87,842		—	%		77,692		14	%
Goodwill		464,450			464,450		—	%		464,450		—	%
Servicing assets		11,532			11,628		(1	)%		11,215		3	%
Other intangible assets, net		4,830			5,278		(8	)%		6,698		(28	)%
Other assets		396,499			363,617		9	%		337,056		18	%
Total assets	$	20,366,138		$	20,568,884		(1	)%	$	18,089,062		13	%

Liabilities:
Deposits	$	15,619,352		$	15,828,209		(1	)%	$	15,029,630		4	%
FHLB and Federal Reserve Bank ("FRB") borrowings		2,260,000			2,130,000		6	%		573,000		294	%
Convertible notes, net		444			206,658		(100	)%		216,678		(100	)%
Subordinated debentures		107,188			106,875		—	%		105,953		1	%
Accrued interest payable		109,236			53,818		103	%		4,112		2,557	%
Other liabilities		201,920			184,744		9	%		159,320		27	%
Total liabilities	$	18,298,140		$	18,510,304		(1	)%	$	16,088,693		14	%

Stockholders' Equity:
Common stock, $0.001 par value	$	137		$	137		—	%	$	137		—	%
Additional paid-in capital		1,433,788			1,430,977		—	%		1,424,891		1	%
Retained earnings		1,127,624			1,106,390		2	%		1,011,715		11	%
Treasury stock, at cost		(264,667	)		(264,667	)	—	%		(264,667	)	—	%
Accumulated other comprehensive loss, net		(228,884	)		(214,257	)	(7	)%		(171,707	)	(33	)%
Total stockholders' equity		2,067,998			2,058,580		—	%		2,000,369		3	%
Total liabilities and stockholders' equity	$	20,366,138		$	20,568,884		(1	)%	$	18,089,062		13	%

Common stock shares - authorized		150,000,000			150,000,000					150,000,000
Common stock shares - outstanding		120,014,888			119,865,732					119,473,939
Treasury stock shares		17,382,835			17,382,835					17,382,835

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

	Three Months Ended										Six Months Ended
	6/30/2023		3/31/2023		% change		6/30/2022		% change		6/30/2023		6/30/2022			% change
Interest and fees on loans	$	225,671	$	215,935	5	%	$	145,024	56	%	$	441,606	$	277,696		59	%
Interest on investment securities		15,534		15,125	3	%		12,308	26	%		30,659		23,964		28	%
Interest on cash and deposits at other banks		25,295		4,922	414	%		74	34,082	%		30,217		211		14,221	%
Interest on other investments		684		695	(2	)%		418	64	%		1,379		825		67	%
Total interest income		267,184		236,677	13	%		157,824	69	%		503,861		302,696		66	%

Interest on deposits		109,724		92,348	19	%		12,220	798	%		202,072		20,896		867	%
Interest on borrowings		26,771		10,451	156	%		4,066	558	%		37,222		7,086		425	%
Total interest expense		136,495		102,799	33	%		16,286	738	%		239,294		27,982		755	%

Net interest income before provision (credit) for credit losses		130,689		133,878	(2	)%		141,538	(8	)%		264,567		274,714		(4	)%
Provision (credit) for credit losses		8,900		1,700	424	%		3,200	178	%		10,600		(7,800	)	N/A
Net interest income after provision (credit) for credit losses		121,789		132,178	(8	)%		138,338	(12	)%		253,967		282,514		(10	)%

Service fees on deposit accounts		2,325		2,221	5	%		2,270	2	%		4,546		4,244		7	%
Net gains on sales of SBA loans		1,872		2,225	(16	)%		5,804	(68	)%		4,097		11,407		(64	)%
Net gains on sales of residential mortgage loans		82		64	28	%		76	8	%		146		833		(82	)%
Other income and fees		12,735		6,468	97	%		4,596	177	%		19,203		9,448		103	%
Total noninterest income		17,014		10,978	55	%		12,746	33	%		27,992		25,932		8	%

Salaries and employee benefits		52,305		57,169	(9	)%		51,058	2	%		109,474		98,803		11	%
Occupancy		6,967		7,521	(7	)%		7,178	(3	)%		14,488		14,513		—	%
Furniture and equipment		5,393		5,058	7	%		4,778	13	%		10,451		9,422		11	%
Data processing and communications		2,917		2,822	3	%		2,893	1	%		5,739		5,354		7	%
FDIC assessment		4,691		1,781	163	%		1,450	224	%		6,472		3,019		114	%
Earned interest credit		5,090		4,427	15	%		835	510	%		9,517		1,311		626	%
Other		9,970		11,576	(14	)%		12,173	(18	)%		21,546		23,316		(8	)%
Total noninterest expense		87,333		90,354	(3	)%		80,365	9	%		177,687		155,738		14	%
Income before income taxes		51,470		52,802	(3	)%		70,719	(27	)%		104,272		152,708		(32	)%
Income tax provision		13,448		13,681	(2	)%		18,631	(28	)%		27,129		39,882		(32	)%
Net income	$	38,022	$	39,121	(3	)%	$	52,088	(27	)%	$	77,143	$	112,826		(32	)%

Earnings Per Common Share - Basic	$	0.32	$	0.33			$	0.43			$	0.64	$	0.94
Earnings Per Common Share - Diluted	$	0.32	$	0.33			$	0.43			$	0.64	$	0.93

Weighted Average Shares Outstanding - Basic		119,953,174		119,551,247				120,219,919				119,753,321		120,175,894
Weighted Average Shares Outstanding - Diluted		120,129,359		120,242,295				120,699,638				120,179,443		120,898,605

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)

	For the Three Months Ended						For the Six Months Ended
Profitability measures (annualized):	6/30/2023		3/31/2023		6/30/2022		6/30/2023		6/30/2022
ROA	0.74	%	0.82	%	1.17	%	0.78	%	1.27	%
ROE	7.34	%	7.65	%	10.33	%	7.49	%	10.99	%
ROA (PPNR) ⁽¹⁾	1.18	%	1.14	%	1.65	%	1.16	%	1.63	%
ROE (PPNR) ⁽¹⁾	11.65	%	10.65	%	14.66	%	11.15	%	14.11	%
ROTCE ⁽¹⁾	9.49	%	9.93	%	13.48	%	9.70	%	14.27	%
Net interest margin	2.70	%	3.02	%	3.36	%	2.85	%	3.28	%
Efficiency ratio (not annualized)	59.13	%	62.38	%	52.09	%	60.74	%	51.80	%
Noninterest expense / average assets	1.71	%	1.89	%	1.80	%	1.80	%	1.75	%

(1)

ROA (PPNR), ROE (PPNR), and ROTCE are non-GAAP financial measures. Quantitative reconciliations of the most directly comparable GAAP to non-GAAP financial measures are provided in the accompanying financial information on Table Page 10.

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)

	Three Months Ended
	6/30/2023						3/31/2023						6/30/2022
	Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost		Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost		Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost
	Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost		Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost		Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost
INTEREST EARNING ASSETS:
Loans, including loans held for sale	$	15,105,212	$	225,671	5.99	%	$	15,235,386	$	215,935	5.75	%	$	14,327,476	$	145,024	4.06	%
Investment securities		2,243,614		15,534	2.78	%		2,248,479		15,125	2.73	%		2,424,454		12,308	2.04	%
Interest earning cash and deposits at other banks		1,996,924		25,295	5.08	%		473,344		4,922	4.22	%		64,545		74	0.46	%
FHLB stock and other investments		47,044		684	5.83	%		47,043		695	5.99	%		69,510		418	2.41	%
Total interest earning assets	$	19,392,794	$	267,184	5.53	%	$	18,004,252	$	236,677	5.33	%	$	16,885,985	$	157,824	3.75	%

INTEREST BEARING LIABILITIES:
Deposits:
Money market and interest bearing demand	$	4,279,819	$	34,377	3.22	%	$	5,341,057	$	41,399	3.14	%	$	6,487,890	$	8,655	0.54	%
Savings deposits		216,060		674	1.25	%		256,194		827	1.31	%		323,114		937	1.16	%
Time deposits		6,890,035		74,673	4.35	%		5,543,369		50,122	3.67	%		2,277,938		2,628	0.46	%
Total interest bearing deposits		11,385,914		109,724	3.87	%		11,140,620		92,348	3.36	%		9,088,942		12,220	0.54	%
FHLB and FRB borrowings		2,177,264		23,622	4.35	%		676,444		6,698	4.02	%		577,966		1,457	1.01	%
Convertible notes, net		96,621		598	2.45	%		217,114		1,322	2.44	%		216,540		1,322	2.42	%
Subordinated debentures		103,123		2,551	9.79	%		102,791		2,431	9.46	%		101,880		1,287	5.00	%
Total interest bearing liabilities	$	13,762,922	$	136,495	3.98	%	$	12,136,969	$	102,799	3.44	%	$	9,985,328	$	16,286	0.65	%
Noninterest bearing demand deposits		4,366,820						4,662,139						5,715,830
Total funding liabilities/cost of funds	$	18,129,742			3.02	%	$	16,799,108			2.48	%	$	15,701,158			0.42	%
Net interest income/net interest spread			$	130,689	1.55	%			$	133,878	1.89	%			$	141,538	3.10	%
Net interest margin					2.70	%					3.02	%					3.36	%

Cost of deposits:
Noninterest bearing demand deposits	$	4,366,820	$	—	—	%	$	4,662,139	$	—	—	%	$	5,715,830	$	—	—	%
Interest bearing deposits		11,385,914		109,724	3.87	%		11,140,620		92,348	3.36	%		9,088,942		12,220	0.54	%
Total deposits	$	15,752,734	$	109,724	2.79	%	$	15,802,759	$	92,348	2.37	%	$	14,804,772	$	12,220	0.33	%

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)

	Six Months Ended
	6/30/2023						6/30/2022
	Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost		Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost
	Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost		Average Balance		Interest Income/ Expense		Annualized Average Yield/Cost
INTEREST EARNING ASSETS:
Loans, including loans held for sale	$	15,169,939	$	441,606	5.87	%	$	14,100,983	$	277,696	3.97	%
Investment securities		2,246,033		30,659	2.75	%		2,522,293		23,964	1.92	%
Interest earning cash and deposits at other banks		1,239,343		30,217	4.92	%		173,836		211	0.24	%
FHLB stock and other investments		47,044		1,379	5.91	%		68,974		825	2.41	%
Total interest earning assets	$	18,702,359	$	503,861	5.43	%	$	16,866,086	$	302,696	3.62	%

INTEREST BEARING LIABILITIES:
Deposits:
Money market and interest bearing demand	$	4,807,506	$	75,775	3.18	%	$	6,413,292	$	14,355	0.45	%
Savings deposits		236,016		1,501	1.28	%		320,824		1,865	1.17	%
Time deposits		6,220,422		124,796	4.05	%		2,447,771		4,676	0.39	%
Total interest bearing deposits		11,263,944		202,072	3.62	%		9,181,887		20,896	0.46	%
FHLB and FRB borrowings		1,431,000		30,320	4.27	%		411,187		2,144	1.05	%
Convertible notes, net		156,535		1,920	2.44	%		216,423		2,645	2.43	%
Subordinated debentures		102,958		4,982	9.62	%		101,729		2,297	4.49	%
Total interest bearing liabilities	$	12,954,437	$	239,294	3.73	%	$	9,911,226	$	27,982	0.57	%
Noninterest bearing demand deposits		4,513,664						5,694,418
Total funding liabilities/cost of funds	$	17,468,101			2.76	%	$	15,605,644			0.36	%
Net interest income/net interest spread			$	264,567	1.70	%			$	274,714	3.05	%
Net interest margin					2.85	%					3.28	%

Cost of deposits:
Noninterest bearing demand deposits	$	4,513,664	$	—	—	%	$	5,694,418	$	—	—	%
Interest bearing deposits		11,263,944		202,072	3.62	%		9,181,887		20,896	0.46	%
Total deposits	$	15,777,608	$	202,072	2.58	%	$	14,876,305	$	20,896	0.28	%

Hope Bancorp, Inc.
Selected Financial Data
Unaudited (dollars in thousands)

	Three Months Ended										Six Months Ended
AVERAGE BALANCES:	6/30/2023		3/31/2023		% change		6/30/2022		% change		6/30/2023		6/30/2022		% change
Loans, including loans held for sale	$	15,105,212	$	15,235,386	(1	)%	$	14,327,476	5	%	$	15,169,939	$	14,100,983	8	%
Investment securities		2,243,614		2,248,479	—	%		2,424,454	(7	)%		2,246,033		2,522,293	(11	)%
Interest earning cash and deposits at other banks		1,996,924		473,344	322	%		64,545	2994	%		1,239,343		173,836	613	%
Interest earning assets		19,392,794		18,004,252	8	%		16,885,985	15	%		18,702,359		16,866,086	11	%
Total assets		20,468,810		19,087,170	7	%		17,876,945	14	%		19,781,806		17,810,045	11	%

Interest bearing deposits		11,385,914		11,140,620	2	%		9,088,942	25	%		11,263,944		9,181,887	23	%
Interest bearing liabilities		13,762,922		12,136,969	13	%		9,985,328	38	%		12,954,437		9,911,226	31	%
Noninterest bearing demand deposits		4,366,820		4,662,139	(6	)%		5,715,830	(24	)%		4,513,664		5,694,418	(21	)%
Stockholders' equity		2,072,859		2,046,159	1	%

Hope Bancorp Reports 2023 Second Quarter Financial Results