Net income for the first quarter of 2026 was $22.6 million, or $0.75 per diluted share, compared with $21.2 million, or $0.70 per diluted share for the fourth quarter of 2025. The return on average assets for the first quarter was 1.18% and the return on average equity was 10.86%, compared with a return on average assets of 1.07% and a return on average equity of 10.14% for the fourth quarter of 2025.
CEO Commentary"Hanmi delivered strong results in the first quarter, reflecting the effective execution of our growth strategy," said Bonnie Lee, President and Chief Executive Officer. "We saw several positive trends, including 7.2% annualized deposit growth, net interest margin expansion, and stable expense levels. This contributed to 6.2% growth in net income, an ROAA of 1.18%, and further strengthened our capital ratios. These results underscore the success of our relationship-driven banking model."
"Consistent with our strategy, we further diversified our loan portfolio where C&I loans reached 17.6% of total loans and C&I loan production increased 64% from new banking relationships. Our asset quality remained excellent, with nonperforming assets falling by 38%, to 0.16% of total assets."
"Based on our first quarter performance and the strong pipeline we have for both loans and deposits, we expect these positive trends in key areas to continue, and we remain confident in our ability to deliver strong financial performance for our shareholders in 2026," concluded Lee.
First Quarter 2026 Highlights:
Net income was $22.6 million, or $0.75 per diluted share, up 6.2% from the fourth quarter, driven by continued growth in net interest income and margin, higher gains from sales of SBA loans, well-controlled noninterest expenses, and a lower effective tax rate. Return on average assets and return on average equity during the quarter were healthy at 1.18% and 10.86%, respectively.
Deposits increased 1.8% to $6.8 billion from the prior quarter and noninterest-bearing demand deposits remained stable at approximately 30% of total deposits.
Loan production increased by 0.8% to $377.9 million from the prior quarter, driven primarily by a 64% increase in commercial and industrial loan production. New loans had a weighted average interest rate of 6.54% compared to a weighted average interest rate of 6.21% for payoffs.
Net interest income continued to grow, increasing 0.5% from the prior quarter, due primarily to lower interest expense as the average rate on interest-bearing deposits declined 16 basis points. Net interest margin increased ten basis points to 3.38%, due primarily to lower rates on interest-bearing deposits.
Asset quality remained strong as nonperforming assets to total assets was 0.16%, an improvement of ten basis points from the prior quarter, and nonperforming loans to total loans was 0.19%, an improvement of nine basis points from the prior quarter.
Hanmi capital ratios strengthened further as tangible common equity to tangible assets improved 12 basis points to 10.11% and the common equity tier 1 capital ratio improved 15 basis points to 12.20%. Simultaneously, Hanmi returned $13.4 million of capital to shareholders in the form of dividends of $8.6 million and share repurchases of $4.8 million.
For more information about Hanmi, please see the Q1 2026 Investor Update (and Supplemental Financial Information), which is available on the Bank's website at www.hanmi.com and via a current report on Form 8-K on the website of the Securities and Exchange Commission at www.sec.gov. Also, please refer to "Non-GAAP Financial Measures" herein for further details of the presentation of certain non-GAAP financial measures.
Quarterly Highlights (Dollars in thousands, except per share data)
As of or for the Three Months Ended
Amount Change
Mar 31,
Dec 31,
Sep 30,
Jun 30,
Mar 31,
Q1-26
Q1-26
2026
2025
2025
2025
2025
vs. Q4-25
vs. Q1-25
Net income
$
22,557
$
21,239
$
22,061
$
15,117
$
17,672
$
1,318
$
4,885
Net income per diluted common share
$
0.75
$
0.70
$
0.73
$
0.50
$
0.58
$
0.05
$
0.17
Assets
$
7,839,227
$
7,869,185
$
7,856,731
$
7,862,363
$
7,729,035
$
(29,958
)
$
110,192
Loans
$
6,545,466
$
6,563,367
$
6,528,259
$
6,305,957
$
6,282,189
$
(17,901
)
$
263,277
Deposits
$
6,800,622
$
6,677,650
$
6,766,639
$
6,729,122
$
6,619,475
$
122,972
$
181,147
Return on average assets
1.18
%
1.07
%
1.12
%
0.79
%
0.94
%
0.11
0.24
Return on average stockholders' equity
10.86
%
10.14
%
10.69
%
7.48
%
8.92
%
0.72
1.94
Net interest margin
3.38
%
3.28
%
3.22
%
3.07
%
3.02
%
0.10
0.36
Efficiency ratio (1)
53.48
%
54.95
%
52.65
%
55.74
%
55.69
%
-1.47
-2.21
Tangible common equity to tangible assets (2)
10.11
%
9.99
%
9.80
%
9.58
%
9.59
%
0.12
0.52
Tangible common equity per common share (2)
$
26.56
$
26.27
$
25.64
$
24.91
$
24.49
0.29
2.07
(1) Noninterest expense divided by net interest income plus noninterest income.
(2) Refer to "Non-GAAP Financial Measures" for further details.
Results of Operations Net interest income increased $0.3 million, or 0.5%, to $63.2 million for the first quarter of 2026, from $62.9 million for the fourth quarter of 2025, principally because of lower interest expense on interest-bearing deposits, which declined by $3.2 million from the fourth quarter. Interest income on loans for the first quarter, however, also declined by $2.7 million from the previous quarter. A $0.5 million special dividend on FHLB stock and a $0.7 million decline in interest income on securities and other interest-earning assets account for the remaining difference.
Net interest margin (taxable equivalent) improved by ten basis points to 3.38% for the first quarter of 2026, from 3.28% for the fourth quarter of 2025. The increase in net interest margin primarily reflected the 16-basis point decline in the cost of interest-bearing deposits.
The average yield on loans for the first quarter was 5.90%, down four basis points from the fourth quarter, and the average balance of loans for the first quarter was $6.43 billion, down 0.3% from the previous quarter. The cost of interest-bearing deposits for the first quarter was 3.20%, down 16 basis points from the fourth quarter, and the average balance of interest-bearing deposits was $4.66 billion, down 1.1% from the previous quarter. The ratio of average loans to average deposits for the first quarter was 97.5%, compared with 96.6% for the previous quarter.
For the Three Months Ended (in thousands)
Percentage Change
Mar 31,
Dec 31,
Sep 30,
Jun 30,
Mar 31,
Q1-26
Q1-26
Net Interest Income
2026
2025
2025
2025
2025
vs. Q4-25
vs. Q1-25
Interest and fees on loans (1)
$
93,866
$
96,592
$
95,691
$
92,589
$
90,887
-2.8
%
3.3
%
Interest on securities
5,959
6,323
6,592
6,261
6,169
-5.8
%
-3.4
%
Dividends on FHLB stock
831
361
357
354
360
130.2
%
130.8
%
Interest on deposits in other banks
1,496
1,837
2,586
2,129
1,841
-18.6
%
-18.7
%
Total interest and dividend income
$
102,152
$
105,113
$
105,226
$
101,333
$
99,257
-2.8
%
2.9
%
Interest on deposits
36,738
39,978
42,244
41,924
40,559
-8.1
%
-9.4
%
Interest on borrowings
676
695
324
684
2,024
-2.7
%
-66.6
%
Interest on subordinated debentures
1,535
1,561
1,579
1,586
1,582
-1.7
%
-3.0
%
Total interest expense
38,949
42,234
44,147
44,194
44,165
-7.8
%
-11.8
%
Net interest income
$
63,203
$
62,879
$
61,079
$
57,139
$
55,092
0.5
%
14.7
%
(1) Includes loans held for sale.
For the Three Months Ended (in thousands)
Percentage Change
Average Earning Assets and Interest-bearing Liabilities
Mar 31,
Dec 31,
Sep 30,
Jun 30,
Mar 31,
Q1-26
Q1-26
2026
2025
2025
2025
2025
vs. Q4-25
vs. Q1-25
Loans (1)
$
6,434,316
$
6,456,239
$
6,304,435
$
6,257,741
$
6,189,531
-0.3
%
4.0
%
Securities
921,065
955,811
985,888
993,975
1,001,499
-3.6
%
-8.0
%
FHLB stock
16,385
16,385
16,385
16,385
16,385
0.0
%
0.0
%
Interest-bearing deposits in other banks
171,953
191,731
239,993
200,266
176,028
-10.3
%
-2.3
%
Average interest-earning assets
$
7,543,719
$
7,620,166
$
7,546,701
$
7,468,367
$
7,383,443
-1.0
%
2.2
%
Demand: interest-bearing
$
74,963
$
77,297
$
86,839
$
81,308
$
79,369
-3.0
%
-5.6
%
Money market and savings
2,063,186
2,130,616
2,122,967
2,109,221
2,037,224
-3.2
%
1.3
%
Time deposits
2,522,505
2,506,582
2,494,285
2,434,659
2,345,346
0.6
%
7.6
%
Average interest-bearing deposits
4,660,654
4,714,495
4,704,091
4,625,188
4,461,939
-1.1
%
4.5
%
Borrowings
69,388
64,565
27,772
60,134
179,444
7.5
%
-61.3
%
Subordinated debentures
130,541
130,385
130,766
130,880
130,718
0.1
%
-0.1
%
Average interest-bearing liabilities
$
4,860,583
$
4,909,445
$
4,862,629
$
4,816,202
$
4,772,101
-1.0
%
1.9
%
Average Noninterest Bearing Deposits
Demand deposits - noninterest bearing
$
1,937,628
$
1,969,908
$
1,960,331
$
1,934,985
$
1,895,953
-1.6
%
2.2
%
(1) Includes loans held for sale.
For the Three Months Ended
Yield/Rate Change
Mar 31,
Dec 31,
Sep 30,
Jun 30,
Mar 31,
Q1-26
Q1-26
Average Yields and Rates
2026
2025
2025
2025
2025
vs. Q4-25
vs. Q1-25
Loans (1)
5.90
%
5.94
%
6.03
%
5.93
%
5.95
%
-0.04
-0.05
Securities (2)
2.62
%
2.67
%
2.70
%
2.55
%
2.49
%
-0.05
0.13
FHLB stock
20.56
%
8.75
%
8.65
%
8.65
%
8.92
%
11.81
11.64
Interest-bearing deposits in other banks
3.53
%
3.80
%
4.27
%
4.26
%
4.24
%
-0.27
-0.71
Interest-earning assets
5.48
%
5.48
%
5.54
%
5.44
%
5.45
%
0.00
0.03
Interest-bearing deposits
3.20
%
3.36
%
3.56
%
3.64
%
3.69
%
-0.16
-0.49
Borrowings
3.94
%
4.27
%
4.63
%
4.58
%
4.57
%
-0.33
-0.63
Subordinated debentures
4.70
%
4.79
%
4.83
%
4.84
%
4.84
%
-0.09
-0.14
Interest-bearing liabilities
3.25
%
3.41
%
3.60
%
3.68
%
3.75
%
-0.16
-0.50
Net interest margin (taxable equivalent basis)
3.38
%
3.28
%
3.22
%
3.07
%
3.02
%
0.10
0.36
Cost of deposits
2.26
%
2.37
%
2.51
%
2.56
%
2.59
%
-0.11
-0.33
(1) Includes loans held for sale.
(2) Amounts calculated on a fully taxable equivalent basis using the federal tax rate in effect for the periods presented.
Credit loss expense for the first quarter of 2026 was $2.9 million, compared with $1.9 million for the fourth quarter of 2025. First-quarter credit loss expense included a $3.2 million provision for loan losses and a negative provision of $0.3 million for off-balance sheet items. Fourth-quarter credit loss expense included $1.7 million for loan losses and $0.2 million for off-balance sheet items.
Noninterest income was $8.5 million for the first quarter of 2026, up 2.9% from $8.3 million for the fourth quarter of 2025. The increase was primarily due to a $0.3 million increase in gain on sales of SBA loans. The gain on sales of SBA loans was $2.1 million for the first quarter of 2026, compared with $1.8 million for the fourth quarter of 2025. The volume of SBA loans sold for the first quarter increased to $32.5 million from $29.9 million for the fourth quarter of 2025, and trade premiums also increased to 7.88% for the first quarter of 2026 compared with 7.40% for the fourth quarter. Residential mortgage loans sold for the first quarter were $31.7 million with a premium of 2.50%, compared with $33.5 million and 2.62% for the fourth quarter. The gain on sales of residential mortgage loans was $0.5 million for the first quarter, compared with $0.6 million for the fourth quarter.
For the Three Months Ended (in thousands)
Percentage Change
Mar 31,
Dec 31,
Sep 30,
Jun 30,
Mar 31,
Q1-26
Q1-26
Noninterest Income
2026
2025
2025
2025
2025
vs. Q4-25
vs. Q1-25
Service charges on deposit accounts
$
2,127
$
2,196
$
2,160
$
2,169
$
2,217
-3.1
%
-4.1
%
Trade finance and other service charges and fees
1,501
1,735
1,551
1,461
1,396
-13.5
%
7.5
%
Servicing income
870
924
924
754
732
-5.8
%
18.9
%
Bank-owned life insurance income
610
315
1,259
708
309
93.7
%
97.4
%
All other operating income
844
758
973
819
897
11.3
%
-5.9
%
Service charges, fees & other
5,952
5,928
6,867
5,911
5,551
0.4
%
7.2
%
Gain on sale of SBA loans
2,102
1,790
1,857
2,160
2,000
17.4
%
5.1
%
Gain on sale of residential mortgage loans
485
581
1,156
-
175
-16.5
%
177.1
%
Total noninterest income
$
8,539
$
8,299
$
9,880
$
8,071
$
7,726
2.9
%
10.5
%
Noninterest expense for the first quarter of 2026 was $38.4 million, down 1.9% from $39.1 million for the fourth quarter of 2025. The decrease was principally due to the income recognized on the sale of foreclosed properties for the first quarter, compared with an expense for other-real-estate-owned for the fourth quarter. No foreclosed properties remained at the end of the 2026-first quarter. The efficiency ratio declined to 53.48% for the first quarter, compared with 54.95% for the previous quarter.
For the Three Months Ended (in thousands)
Percentage Change
Mar 31,
Dec 31,
Sep 30,
Jun 30,
Mar 31,
Q1-26
Q1-26
2026
2025
2025
2025
2025
vs. Q4-25
vs. Q1-25
Noninterest Expense
Salaries and employee benefits
$
21,956
$
22,472
$
22,163
$
22,069
$
20,972
-2.3
%
4.7
%
Occupancy and equipment
4,414
4,339
4,507
4,344
4,450
1.7
%
-0.8
%
Data processing
4,386
4,098
3,860
3,727
3,787
7.0
%
15.8
%
Professional fees
2,780
2,343
1,978
1,725
1,468
18.7
%
89.4
%
Supplies and communication
556
573
423
515
517
-3.0
%
7.5
%
Advertising and promotion
688
1,010
712
798
585
-31.9
%
17.6
%
All other operating expenses
3,849
3,795
3,665
3,567
3,175
1.4
%
21.2
%
Subtotal
38,629
38,630
37,308
36,745
34,954
0.0
%
10.5
%
Other real estate owned expense (income)
(345
)
474
17
(461
)
41
-172.8
%
941.5
%
Repossessed personal property expense (income)
84
5
32
63
(11
)
1580.0
%
-863.6
%
Total noninterest expense
$
38,368
$
39,109
$
37,357
$
36,347
$
34,984
-1.9
%
