Hope Bancorp reports Q2 net loss of $27.9 mln

Overview

• Hope Bancorp reports Q2 net loss of $27.9 mln due to securities repositioning

• Excluding notable items, Q2 net income rises 7% quarter-over-quarter

• Net interest income grows 17%, aided by Territorial Bancorp acquisition

Outlook

• Company expects $12 mln annual interest income from securities repositioning

• Hope Bancorp anticipates 1% reduction in effective tax rate

• Company maintains strong capital and liquidity for growth opportunities

Result Drivers

• TERRITORIAL ACQUISITION - Acquisition contributed to loan growth and diversification, reducing deposit costs

• SECURITIES REPOSITIONING - Strategic repositioning led to net loss but expected to improve future earnings

• TAX LAW CHANGE - Change in California tax law impacted tax expense but expected to lower effective tax rate

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy."

• Wall Street's median 12-month price target for Hope Bancorp Inc is $12.00, about 5.3% above its July 21 closing price of $11.36

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 10 three months ago

Press Release: ID:nBw46M1MBa