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Dec 31, 2019
Hope Bancorp Q4 2019 Earnings Report
Hope Bancorp reported solid results driven by strategic initiatives.
Key Takeaways
Hope Bancorp reported a net income of $43.0 million, or $0.34 per diluted common share, for the fourth quarter of 2019. The company saw a favorable shift in its deposit base to lower costing core deposits and originated a record level of $848 million in new loans. Noninterest expenses remained well contained at 1.85% of total assets.
Record new loan originations of $847.6 million led to more than a 1% increase in loans receivable quarter-over-quarter, or 6% annualized.
Deposit initiatives contributed to a 13 basis point reduction quarter-over-quarter in total deposit costs, the first quarter-over-quarter decrease since Q4 2016.
Total deposits increased 2% quarter-over-quarter, reflecting a continuation of a favorable mix-shift to core deposits.
Total noninterest expenses were well contained and remained at 1.85% of average assets.
Forward Guidance
Hope Bancorp believes it is positioned to begin seeing some margin expansion by the second half of 2020, which will ultimately improve its ability to further enhance returns and profitability, assuming no further changes in the Fed Funds rate this year.
Positive Outlook
- Progress in controlling deposit costs
- Growing contribution of higher-rate SBA loans in the portfolio
- Potential margin expansion by the second half of the year
- Improved ability to enhance returns
- Improved ability to enhance profitability
Historical Earnings Impact
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Avg. Return Before/After Earnings
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