Hope Bancorp
Annual Report 2016

Plain-text annual report

The Representative Bank of the Korean-American Community Bank of Hope was formed through a merger of equals of BBCN Bank and Wilshire Bank on July 29, 2016, but the roots of the company go back more than 36 years and include many of the first banks established in the United States by Korean immigrants. Today, Bank of Hope has a national platform that includes solid presence in all of the top geographic markets with the largest Asian-American populations in the country and is the representative bank and pride of the Korean-American community. 2nd Merger of Equals Jul 2016 Foster Bank Aug 2013 Pacific International Bank Feb 2013 1st Merger of Equals Nov 2011 Innovative Bank Apr 2010 Asiana Bank Apr 2003 Saehan Bank Jul 2013 BankAsiana Jun 2013 Mirae Bank Jun 2009 Liberty Bank of New York Aug 2005 Established 1986 Established 1989 Established 1980 2016 ANNUAL REPORT / 1  Events Leading Up to the Formation of Bank of Hope During the five years prior to the merger of equals, the two predecessor banks respectively made meaningful progress enhancing their geographic footprints in new markets, expanding their product and service offerings, and gaining recognition for their leading operational performances. Completed 1st Merger of Equals Transformed the Korean-American banking landscape Expanded Seattle & Chicago Ops Glenview Branch Opening PI Bank & Foster Bank Acquisitions New Product Launch Equipment Lease Financing Established Seoul Rep Office Expanded NJ Ops Palisades Park Branch Opening New Product Launches Credit Card Wealth Mortgage Completed 2nd Merger of Equals Created the Only Super Regional Korean-American Bank 2011 2012 2013 2014 2015 Jul 29 2016 Began New Growth Trajectory SBA LPO Openings Expanded NY Metro & SoCal Ops Palisades Park Branch Openings Bank Asiana & Saehan Bank Acquisitions Expanded Texas Ops Houston- Harwin Branch Opening Expanded Mortgage Ops Mortgage Department Acquisition Entered New Markets LaGrange & Montgomery Branch Openings Merger of Equals July 29, 2016 2016 ANNUAL REPORT / 2 2016 ANNUAL REPORT / 3 n Steven S. Koh Chairman of the Board n Kevin S. Kim President & Chief Executive Officer Message to Stockholders Transformation Embarking on a New Course of History 1st Only Super Regional Bank The First and Only Super Regional Korean-American Bank in the United States 5 Consecutive Years Best Banks in America The Only Korean-American Bank Ever Dear Valued Stockholders, Customers and Employees: We made history in 2016 with the creation of the first and only super regional Korean-American bank in the United States. With the combination of the top two commercial lenders in our niche market, we transformed Bank of Hope into the 6th largest bank headquartered in Los Angeles, the 11th largest bank in California, and the 82nd largest financial institution in the nation. Our commitment to strong financial performance is underscored by the fact that Bank of Hope has been recognized on Forbes’ List of “Best Banks in America” for five consecutive years and has been among the to be Recognized on Forbes’ List of top 10 SBA lenders in the nation, on a pro forma basis, “Best Banks in America” for the past 10-plus years. 10th Top SBA Lender Among the Top 10 SBA Lenders in the Nation for the Past 10-plus Years (Pro Forma for Years prior to 2016) As a result of the merger of equals, our balance sheet was significantly larger at year-end 2016, compared with the prior year, with total assets increasing 70% to $13.44 billion, loans receivable increasing 69% to $10.54 billion and total deposits increasing 68% to $10.64 billion. With the merger, we also crossed the $10 billion threshold for financial institutions, which has considerable implica- tions for a growing bank in terms of increased regulations, risk management, staffing and the threat of cybercrime. 2016 ANNUAL REPORT / 4 2016 ANNUAL REPORT / 5 Message to Stockholders Given the greater responsibilities as a $10 billion-plus financial We further strengthened our executive management of Directors of the Bank for the last three years, we expect a institution, we are proud to have one of the strongest leadership team with the appointment of David P. Malone as Senior seamless transition of oversight responsibilities and look We are proud to have one of the strongest leadership teams among Asian-American banks. teams among Asian-American banks. Our executive management Executive Vice President and Chief Operating Officer, taking on forward to his contributions. team, which remains virtually intact following the transaction, responsibility for oversight of support and administrative represents a complementary combination of the two predecessor functions of Bank of Hope. One of the most accomplished With the physical integration of the merger successfully banks and is symbolic of a true merger of equals. bankers in Southern California and having served on the Board completed, the Board of Directors and executive management Leadership Kevin S. Kim President & Chief Executive Officer Business Leadership Operations Oversight Risk Management Kyu S. Kim Senior Executive Vice President & Regional President, Eastern Region David W. Kim Executive Vice President & Chief Retail Banking Officer David Song Executive Vice President & Chief Lending Officer, Western Region Janette Mah Executive Vice President & Chief Mortgage Banking Officer Jason K. Kim Executive Vice President & Chief Commercial Lending Officer Douglas J. Goddard Executive Vice President & Chief Financial Officer, Hope Bancorp, Inc. David P. Malone Senior Executive Vice President & Chief Operating Officer Johann (Min) You Executive Vice President & Chief Risk Officer Lisa K. Pai Executive Vice President, Chief Administrative Officer & General Counsel Peter Koh Executive Vice President & Chief Credit Officer Daniel H. Kim Executive Vice President & Chief Strategy Officer Alex Ko Executive Vice President & Chief Financial Officer, Bank of Hope Brian E. Van Dyk Executive Vice President & Chief Information Officer 2016 ANNUAL REPORT / 6 2016 ANNUAL REPORT / 7 Diversification Expanded Offering of Products and Service Message to Stockholders Diverse range of variable and fixed rate commercial real estate financing options. Competitive equipment lease financing options that preserve working capital and enhance business cash flow. Leveraging the value of your existing assets to provide greater financial flexibility. Recognized PLP lender (Preferred Lenders Program) offering a wide range of SBA products and services. CRE Lending SBA Lending Commercial Lending Equipment Lease Financing Residential Mortgage Fixed and adjustable rate programs for your perfect home. Serving independent mortgage bankers nationwide. Asset-Based Lending Int’l Trade Finance Treasury Management Solutions Credit Card Foreign Currency Trade finance solutions to help your company compete in the global marketplace. Commercial loans and Facilitate the movement lines of credit to help your business grow. of funds through comprehensive treasury management solutions. Consumer and Business rewards, cashback and low rate credit cards to meet your financial needs. Competitive rates on more than 70 currencies for exchange. Residential Warehouse Lending Wealth Management Comprehensive investment and wealth management services to fit your specific financial goals. team are now focused on driving profitable growth of our organization beyond the initial core strengths in international And as a result of our merger, Bank of Hope has By targeting our existing customer base, we believe the franchise. trade finance, SBA and commercial real estate lending into a become the only Korean-American bank with a true Company will safely and soundly grow into our new diversified financial institution with a strong residential mort- national footprint and meaningful presence in all of capabilities, resulting in deeper and stronger relation- Today, Bank of Hope enjoys a significantly stronger competi- gage platform, the only Korean-American bank-issued credit the top geographic markets with the largest Asian- ships with our customers, as well as accelerated and more tive position, with unrivaled leadership among our niche peers card program and other specialty services, including treasury American populations. We also expect to become the first diversified growth in our commercial and consumer portfolios and unparalleled opportunity to cross-sell a comprehensive management solutions, equipment lease financing, foreign Korean-American bank to expand internationally with the in the years to come. offering of products and services. We have transformed our currency, asset-based lending and wealth management. opening of our Seoul Branch in late 2017. 2016 ANNUAL REPORT / 8 2016 ANNUAL REPORT / 9 Message to Stockholders Investment and Growth “Bank of Hope takes great pride in fostering growth in the customers and communities that we derive our value from.” APIASF President & Executive Director Neil Horikoshi, Bank of Hope President & CEO Kevin Kim (center), and other Bank of Hope teammates congratulate Southern California scholarship recipients. Bank of Hope teammates and family members at United Way of Greater Los Angeles’ 2016 HomeWalk. Bank of Hope Chairman Steven S. Koh (left), 2017 Bank of Hope Founders Cup Champion Anna Nordqvist (center), and Bank of Hope President & CEO Kevin Kim (next), together with members of the LPGA-USGA Girls Golf program following the $1 million donation of the Founders Cup tournament proceeds. Notwithstanding the significant amount of energy devoted Working in collaboration with the Asian & Pacific Island Bank of Hope Founders Cup Bank of Hope takes great pride in fostering growth in the to the successful integration of our transformed organization, American Scholarship Fund (APIASF), scholarships were customers and communities that we derive our value from. Bank of Hope originated a record $1.85 billion in new loans awarded to 50 students who demonstrated strong The Founders Cup honors the 13 visionary women who to support the growth of its customers, representing a 10% academic performance, leadership capabilities and a need established the LPGA in 1950. The premier women’s For the full 2016 year, net income increased 23% to $113.7 increase over 2015 production volumes. for financial assistance as they were preparing to enroll in professional sports organization in the world today, the million, or $1.10 per diluted common share, based on their first year of college. LPGA has maintained a strong focus on giving back to its 103,530,318 weighted average diluted shares outstanding, We also continued to support our communities through other forms of investments and contributions, by partner- United Way HomeWalk ing with various public, private and non-profit sectors in communities. from $92.3 million, or $1.16 per diluted common share, based on 79,611,800 weighted average diluted shares outstanding, Likewise, Bank of Hope was founded by visionaries, and in 2015. Excluding pre-tax merger-related expenses of $16.9 community activities and events. For the second consecutive year, Bank of Hope partnered today we are the representative bank of the Korean-American million in 2016 and $1.5 million in 2015, core net income would Hope Scholarship Foundation the annual HomeWalk, a 5K Walk and Fun Run that mobilizes Founders Cup tournament proceeds being donated to the for 2016 and $93.2 million, or $1.17 per diluted common share, with United Way of Greater Los Angeles by participating in community with strong ties to our communities. With the have been $123.8 million, or $1.20 per diluted common share, Bank of Hope continued its commitment to support funds to end homelessness in Los Angeles County, where the be the title sponsor to a tournament that pays tribute to the youth in our communities. In 2016, Bank of Hope roots of Bank of Hope were sown. visionaries and gives back to its communities. thousands of Angelenos in an effort to raise awareness and LPGA-USGA Girls Golf program, Bank of Hope is pleased to for 2015. contributed $140,000 to the Hope Scholarship Foundation. 2016 ANNUAL REPORT / 10 2016 ANNUAL REPORT / 11 Message to Stockholders Bankers. Experts. Neighbors. Committed to Enhancing Returns As of December 31, 2016, the Company continued dedication of our Board of Directors and executive to maintain robust capital levels with total risk-based management team, Bank of Hope is well positioned capital at 13.64%, leverage ratio at 11.49%, and common to deliver sustainable benefits and enhanced returns equity tier 1 capital at 12.10%. Given the solid financial for all of our stakeholders, including our customers, our performance and improved prospects for Bank of Hope, employees, our communities and our shareholder base. our Board of Directors further increased the common dividend to our stockholders for the fourth consecutive We are committed to improving the value of our service year to $0.12 per common share. as Bankers, providing unmatched Expertise to our clients, and becoming good Neighbors that foster With the transformational merger of equals completed in the growth of our customers and communities. 2016, we have begun a new chapter in our organization’s history. Bank of Hope is an unrivaled institution with the On behalf of the entire Board of Directors, we express only nationwide platform providing full banking services our sincerest appreciation to our employees for their in all of the top major geographic markets with sizeable tireless efforts and dedication, our customers for their Asian-American communities in the United States. loyal patronage, our regulators for their collaborative Coupled with the most comprehensive offering of guidance and our stockholders for their ongoing support products and services for our customer base and the and trust. Sincerely, Financial Highlights A Year of Transformation . $ 1 3 4 4 b i l l i o n . $ 1 0 6 4 b i l l i o n 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Total Assets Increased 70% to $13.44 billion Total Deposits Increased 68% to $10.64 billion $ 1 1 3 7 m . i l l i o n . $ 1 0 5 4 b i l l i o n 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Net Income Increased 23% to $113.7 million Loans Receivable Increased 69% to $10.54 billion . $ 1 8 6 b i l l i o n . 1 3 6 4 % Steven S. Koh Chairman of the Board Kevin S. Kim President & Chief Executive Officer 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Stockholders’ Equity Increased 98% to $1.86 billion Total Risk-based Capital Ratio Declined to 13.64% 2016 ANNUAL REPORT / 12 2016 ANNUAL REPORT / 13 Selected Financial Data Selected Financial Data (dollars in thousands, except share and per share data) 2016 2015 2014 2013 2012 (dollars in thousands) 2016 2015 2014 2013 2012 As of and For the Years Ended December 31, As of and For the Years Ended December 31, Income Statement Data Interest income Interest expense Net interest income Provision for loan losses $ 421,934 $ 313,660 $ 302,657 $ 283,073 $ 267,885 58,579 40,618 36,060 30,018 29,647 363,355 273,042 266,597 253,055 238,238 9,000 8,000 12,638 20,000 19,104 Net interest income after provision for loan losses 354,355 265,042 253,959 233,055 219,134 Noninterest income Noninterest expense 51,819 43,691 44,187 42,719 214,975 153,384 151,624 141,620 Income before income tax provision 191,199 155,349 146,522 134,154 Income tax provision Net income Dividends and discount accretion on preferred stock 77,452 63,091 57,907 52,399 $ 113,747 _ $ 92,258 _ $ 88,615 _ $ 81,755 _ 39,449 120,950 137,633 54,410 $ 83,223 (5,640) Net income available to common stockholders $ 113,747 $ 92,258 $ 88,615 $ 81,755 $ 77,583 Per Common Share Data Earnings _ basic Earnings _ diluted Book value (period end, excluding preferred stock and warrants) Cash dividends declared per common share $ 1.10 1.10 13.72 0.45 $ 1.16 1.16 11.79 0.42 $ 1.11 1.11 11.10 0.35 $ 1.03 1.03 10.18 0.25 $ 0.99 0.99 9.62 0.05 Number of common shares outstanding (period end) 135,240,079 79,566,356 79,503,552 79,441,525 78,041,511 Balance Sheet Data—At Period End Assets $13,441,422 $7,912,648 $7,140,330 $6,475,199 $ 5,640,661 Securities available for sale 1,556,740 1,010,556 792,523 701,751 700,403 Loans receivable, net of unearned loan fees and discounts (excludes loans held for sale) 10,543,332 6,248,341 5,565,192 5,074,175 4,296,252 Deposits 10,642,035 6,340,976 5,693,452 5,148,057 4,384,035 Federal Home Loan Bank advances 754,290 530,591 480,975 421,352 Subordinated debentures Stockholders’ equity Average Balance Sheet Data Assets Securities available for sale 420,722 41,846 99,808 42,327 42,158 57,410 1,855,473 938,095 882,773 809,374 751,104 $ 10,342,063 $ 7,389,530 $ 6,830,244 $ 6,042,674 $ 5,228,557 1,276,068 871,010 713,775 699,812 690,719 Gross loans, including loans held for sale 8,121,897 5,846,658 5,355,243 4,692,089 3,974,626 Deposits Stockholders’ equity 8,232,984 5,879,704 5,439,920 4,739,261 3,989,401 1,342,954 912,609 848,443 788,570 775,718 Complete financial information is contained in the Company’s Form 10-K attached herewith in electronic form and incorporated by reference as part of Hope Bancorp’s 2016 Annual Report. Selected Performance Ratios Return on average assets (1) Return on average stockholders’ equity (2) Average stockholders’ equity to average assets Dividend payout ratio (3) Net interest spread (4) Net interest margin (5) Yield on interest earning assets (6) Cost of interest bearing liabilities (7) Efficiency ratio (8) Regulatory Capital Ratios Hope Bancorp: Common Equity Tier 1 Tier 1 leverage Tier 1 risk-based Total risk-based Bank of Hope: Common Equity Tier 1 Tier 1 leverage Tier 1 risk-based Total risk-based Asset Quality Data Nonaccrual loans Loans 90 days or more past due and still accruing (9) Restructured loans (accruing) Total nonperforming loans Other real estate owned Total nonperforming assets Asset Quality Ratios Nonaccrual loans to loans receivable Nonperforming loans to loans receivable Nonperforming assets to total assets Non-performing assets to loans receivable and OREO Allowance for loan losses to loans receivable Allowance for loan losses to nonaccrual loans Allowance for loan losses to nonperforming loans Allowance for loan losses to nonperforming assets Net charge-offs (recoveries) to average gross loans 1.10% 8.47% 12.99% 40.86% 3.49% 3.75% 4.36% 0.87% 51.78% 12.10% 11.49% 12.92% 13.64% 12.75% 11.33% 12.75% 13.46% 1.25% 10.11% 12.35% 36.21% 3.62% 3.88% 4.46% 0.84% 48.43% 12.08% 11.53% 12.67% 13.80% 12.56% 11.43% 12.56% 13.69% 1.30% 10.44% 12.42% 31.53% 3.88% 4.13% 4.68% 0.80% 48.79% 12.96% 11.62% 13.64% 14.80% 13.44% 11.45% 13.44% 14.61% $ 40,074 305 48,874 89,253 21,990 $ 111,243 $ 40,801 375 47,984 89,160 21,035 $ 110,195 $ 46,353 361 57,128 103,842 21,938 $ 125,780 0.38% 0.85% 0.83% 1.05% 0.75% 197.99% 88.90% 71.32% 0.07% 0.65% 1.43% 1.39% 1.76% 1.22% 187.27% 85.70% 69.34% (0.01)% 0.83% 1.87% 1.76% 2.25% 1.22% 146.18% 65.25% 53.87% 0.23% 1.35% 10.37% 13.05% 24.27% 4.23% 4.46% 4.99% 0.76% 47.88% 12.65% 11.97% 13.66% 14.90% 13.46% 11.79% 13.46% 14.70% $ 39,154 5 33,903 73,062 24,288 $ 97,350 0.77% 1.44% 1.50% 1.91% 1.33% 171.94% 92.14% 69.15% 0.42% 1.59% 10.73% 14.84% 5.05% 4.59% 4.88% 5.48% 0.89% 43.56% 14.03% 12.76% 14.91% 16.16% 14.47% 12.38% 14.47% 15.73% $ 29,653 _ 29,849 59,502 2,698 $62,200 0.69% 1.38% 1.10% 1.45% 1.56% 225.75% 112.50% 107.62% 0.36% (1) Net income divided by the average assets (2) Net income divided by the average stockholders’ equity (3) Dividends per share divided by earnings per share (4) Difference between the average yield earned on interest earning assets and the average rate paid on interest bearing liabilities (5) Net interest income expressed as a percentage of average interest earning assets (6) Interest income divided by the average interest earning assets (7) Interest expense divided by the average interest bearing liabilities (8) Noninterest expense divided by the sum of net interest income plus noninterest income (9) Excludes acquired credit impaired loans totaling $19.6 million, $12.2 million, $30.4 million, $43.8 million and $17.7 million as of December 31, 2016, 2015, 2014, 2013 and 2012, respectively. 2016 ANNUAL REPORT / 14 2016 ANNUAL REPORT / 15 Board of Directors . c n I , p r o c n a B e p o H e p o H f o k n a B d n a Hope Bancorp’s executive management team is supported by a distinguished group of leaders and corporate professionals from various market sectors and industry groups. The expertise of our Directors includes accounting, auditing and financial reporting, commercial banking, investment banking, investment management, legal, corporate management, strategic planning, business acquisitions, marketing, international operations, retail and small to middle-market business operations. Jin Chul Jhung Chairman & President Royal Imex, Inc. Donald D. Byun Former President Jay Dee, Inc. Steven S. Koh Chairman of the Board Chairman Pacific Steel Corporation Kevin S. Kim President & Chief Executive Officer Hope Bancorp, Inc. and Bank of Hope Scott Yoon-Suk Whang Lead Independent Director Founder and Chief Executive Officer Orange Circle Studios Steven J. Didion General Partner and Portfolio Manager JCSD Partners, LP Daisy Y. Ha Attorney Jinho Doo Chief Executive Officer Key Capital Management, LLC David P. Malone Senior Executive Vice President & Chief Operating Officer Bank of Hope Chung Hyun Lee Former President NuArt International, Inc. John R. Taylor Former Senior Audit Partner KPMG LLP Dale S. Zuehls, PhD Principal Zuehls, Legaspi & Company William J. Lewis Lawrence Jeon Former Executive Vice President & Chief President Craig Mautner Former Senior Software Engineer Credit Officer East West Bank Lawrence Jeon & Company Google, Inc. 2016 ANNUAL REPORT / 16 2016 ANNUAL REPORT / 17 Location Information SOUTHERN CALIFORNIA Branches Koreatown City Center 3435 Wilshire Blvd, Suite 150 Los Angeles, CA 90010 T (213) 427-2222 Olympic-Hoover 2222 W Olympic Blvd Los Angeles, CA 90006 T (213) 386-2222 Olympic-Vermont 2727 W Olympic Blvd, Suite 104 Los Angeles, CA 90006 T (213) 235-3100 Olympic-Western 3267 W Olympic Blvd Los Angeles, CA 90006 T (213) 388-2222 Western-9th 841 S Western Ave Los Angeles, CA 90005 T (213) 387-7070 Western-Beverly 253 N Western Ave Los Angeles, CA 90004 T (213) 381-2222 Wilshire 3200 Wilshire Blvd Los Angeles, CA 90010 T (213) 427-1000 Wilshire-Harvard 3600 Wilshire Blvd, Suite 100-A Los Angeles, CA 90010 T (213) 351-5980 Wilshire-Manhattan 3832 Wilshire Blvd Los Angeles, CA 90010 T (213) 427-7711 Downtown LA Fullerton/Cerritos Broadway 1205 S Broadway Los Angeles, CA 90015 T (213) 746-2222 Fashion Town 1300 S San Pedro St #200 Los Angeles, CA 90015 T (213) 746-3200 Maple 401 E 11th St #211 Los Angeles, CA 90015 T (213) 763-1800 San Pedro Mart 1100 S San Pedro St, Unit L21 Los Angeles, CA 90015 T (213) 745-5550 Wall 1122 S Wall St Los Angeles, CA 90015 T (213) 763-1122 Huntington Park Huntington Park 6350 Pacific Blvd Huntington Park, CA 90255 T (323) 584-5950 South Bay Gardena 1655 W Redondo Beach Blvd Gardena, CA 90247 T (310) 327-2222 Torrance 2424 Sepulveda Blvd, Suite A Torrance, CA 90501 T (310) 328-5555 Torrance Market 4340 Pacific Coast Hwy Torrance, CA 90505 T (310) 257-0100 Cerritos 17500 Carmenita Rd Cerritos, CA 90703 T (562) 926-2520 Fullerton 5300 Beach Blvd, Unit 101 Buena Park, CA 90621 T (714) 690-1400 Fullerton-Beach 5307 Beach Blvd Buena Park, CA 90621 T (714) 994-5000 La Palma 4875 La Palma Ave La Palma, CA 90623 T (562) 468-0900 Garden Grove/Irvine Garden Grove 9580 Garden Grove Blvd Suite 100 Garden Grove, CA 92844 T (714) 891-2222 Irvine-Culver 14429 Culver Dr Irvine, CA 92604 T (949) 777-3777 Irvine-Jeffrey1 14725 Jeffrey Rd Irvine, CA 92618 T (949) 559-7900 Rowland Heights/ Diamond Bar/Inland Empire Diamond Bar 2809 S Diamond Bar Blvd Diamond Bar, CA 91765 T (909) 718-2000 Inland 1040 S Mt. Vernon Ave, Suite A Colton, CA 92324 T (909) 370-2222 Rancho Cucamonga 8045 Archibald Ave, Suite 100 Los Angeles, CA 90006 T (909) 919-7755 Rowland Heights-Colima 19765 E Colima Rd Rowland Heights, CA 91748 Rowland Heights-Nogales 1709 S Nogales St, Suite 100 Rowland Heights, CA 91748 T (626) 581-4020 Valley La Crescenta 3231 Foothill Blvd, Suite 205 La Crescenta, CA 91214 T (818) 551-0700 North Northridge 10147 Reseda Blvd Northridge, CA 91324 T (818) 534-3333 South Northridge 8401 Reseda Blvd Northridge, CA 91324 T (818) 773-6133 San Diego San Diego 4428 Convoy St, Suite #A-200 San Diego, CA 92111 T (858) 874-3333 Commercial Loan Centers Buena Park Office 5254 Beach Blvd Buena Park, CA 90621 T (714) 523-5550 Broadway Office 1205 S Broadway Los Angeles, CA 90015 T (213) 763-7899 Gardena Office 1655 W Redondo Beach Blvd Gardena, CA 90247 T (310) 327-2222 Olympic-Hoover Office 2222 W Olympic Blvd, 2nd Floor Los Angeles, CA 90006 T (213) 386-2222 Olympic-Vermont Office 2727 W Olympic Blvd, Suite 104 Los Angeles, CA 90006 T (213) 235-3100 T (213) 235-3113 Western-Beverly Office 253 N Western Ave Los Angeles, CA 90004 T (213) 381-2222 Gardena Office 1655 W Redondo Beach Blvd 3rd Floor Gardena, CA 90247 T (310) 352-3000 Laguna Niguel LPO 28202 Cabot Rd, Suite 300 Laguna Niguel, CA 92677 T (949) 365-5490 Newport Beach LPO 24 Corporate Plaza, Suite 180 Newport Beach, CA 92660 T (949) 999-7900 Premier Banking Group Credit Card Department Olympic-Western Office 3267 W Olympic Blvd, 2nd Floor Los Angeles, CA 90006 T (213) 235-3113 Corporate Headquarters 3200 Wilshire Blvd, 11th Floor Los Angeles, CA 90010 T (213) 355-2850 Corporate Banking Centers LA Regional Office 3731 Wilshire Blvd, Suite 320 Los Angeles, CA 90010 T (213) 365-3322 Olympic-Hoover Office 2222 W Olympic Blvd, 2nd Floor Los Angeles, CA 90006 T (213) 637-9503 T (213) 637-9550 Wilshire-Harvard Office 3600 Wilshire Blvd, Suite 100-A Los Angeles, CA 90010 T (213) 234-1276 SBA Department Corporate Headquarters 3200 Wilshire Blvd, 7th Floor Los Angeles, CA 90010 T (877) 627-2722 Mortgage Banking Division Corporate Headquarters 3200 Wilshire Blvd, 4th Floor Los Angeles, CA 90010 T (866) 972-2265 Commercial Equipment Lease Financing Department Corporate Headquarters 3200 Wilshire Blvd, 4th Floor Los Angeles, CA 90010 T (213) 805-8230 Syndicated Lending Group Corporate Headquarters 3200 Wilshire Blvd, 5th Floor Los Angeles, CA 90010 T (213) 427-6321 Investment Services Olympic-Western Office 3267 W Olympic Blvd Los Angeles, CA 90006 T (213) 201-3600 NORTHERN CALIFORNIA Branches Oakland 1940 Webster St Oakland, CA 94612 T (510) 302-0505 Silicon Valley 1102 E El Camino Real Sunnyvale, CA 94087 T (408) 557-2000 Houston 10000 Harwin Dr Houston, TX 77036 T (713) 774-0411 Commercial Loan Centers Commercial Loan Centers NCA Commercial Lending 47102 Mission Falls Ct, Suite 100 Fremont, CA 94539 T (510) 550-8000 South Central Region Loan Center 2237 Royal Ln Dallas, TX 75229 T (972) 919-9999 SBA Dallas Office 2237 Royal Ln Dallas, TX 75229 T (972) 919-9999 ILLINOIS Branches Arlington Heights 83 West Golf Rd Arlington Heights, IL 60005 T (847) 398-7700 Devon 4001 W Devon Ave Chicago, IL 60646 T (773) 736-1300 Glenview 1645 N Milwaukee Ave Glenview, IL 60025 T (847) 818-4852 Naperville 1504 Naper Blvd, Suite 136 Naperville, IL 60563 T (630) 505-7200 Niles 8504-A W Golf Rd Niles, IL 60714 T (847) 965-7373 WASHINGTON Branches Federal Way 31827-B Pacific Hwy S Federal Way, WA 98003 T (253) 941-9200 Lynnwood 17410 Hwy 99, Suite 120 Lynnwood, WA 98037 T (425) 743-7777 Lynnwood Market 3301 184th St SW, Suite 125 Lynnwood, WA 98037 T (425) 776-5111 Tacoma 8608 S Tacoma Way Lakewood, WA 98499 T (253) 984-7900 TEXAS Branches Dallas 2237 Royal Ln Dallas, TX 75229 T (972) 919-9999 Fort Worth 7553 Boulevard 26 North Richland Hills, TX 76180 T (817) 514-4600 Niles Market 801 Civic Center Dr, Suite 155 Niles, IL 60714 T (847) 965-2402 Commercial Loan Centers MW Region Loan Center 8504-A W Golf Rd Niles, IL 60714 T (847) 965-7373 NEW YORK Branches Bayside 209-07 Northern Blvd Bayside, NY 11361 T (718) 428-1606 Flushing-150th 150-24 Northern Blvd, Suite G4 Flushing, NY 11354 T (347) 625-2800 Flushing-Crocheron 162-05 Crocheron Ave Flushing, NY 11358 T (718) 888-0020 Flushing-Union 138-02 Northern Blvd Flushing, NY 11354 T (718) 886-6611 Great Neck 485 Great Neck Rd Great Neck, NY 11021 T (516) 466-4160 Manhattan 16 W 32nd St New York, NY 10001 T (212) 279-2790 Woodside 50-15 Roosevelt Ave Woodside, NY 11377 T (718) 335-2000 Commercial Loan Centers Manhattan Office 16 W 32nd St New York, NY 10001 T (212) 279-2790 Fifth Avenue Office 307 Fifth Ave, 5th Floor New York, NY 10001 T (212) 465-7621 Premier Commercial Banking Division Manhattan Office 16 W 32nd St New York, NY 10001 T (212) 279-2790 Eastern Region SBA Department Flushing-Union Office 138-02 Northern Blvd Flushing, NY 11354 T (718) 886-6611 NEW JERSEY Branches Edison 1757 Lincoln Hwy Edison, NJ 08817 T (732) 839-0640 Fort Lee 172 Main St Fort Lee, NJ 07024 T (201) 585-7707 Palisades Park 303 Broad Ave Palisades Park, NJ 07650 T (201) 582-1100 VIRGINIA Branches Annandale 7410 Little River Tpke Annandale, VA 22003 T (203) 354-4310 Centreville 13890 Braddock Rd, Suite 102 Centreville, VA 20121 T (571) 321-6272 GEORGIA Branches LaGrange 1508 Lafayette Pkwy LaGrange, GA 30241 T (706) 882-5885 ALABAMA Branches Montgomery 1605 Eastern Blvd Montgomery, AL 36117 T (334) 277-4118 SBA LOAN PRODUCTION OFFICES Annandale LPO 7535 Little River Tpke Suite 120-A Annandale, VA 22003 T (877) 627-2722 Atlanta LPO 3575 Koger Blvd, #380 Duluth, GA 30096 T (678) 380-0774 Dallas LPO 3010 Lyndon B Johnson Fwy Suite 205 Dallas, TX 75234 T (469) 522-4955 Denver LPO 2851 S Parker Rd, Suite 1120 Aurora, CO 80014 T (720) 535-5060 Portland LPO 111 SW 5th Ave, Suite 3160 Portland, OR 97204 T (503) 360-9193 Seattle LPO 400 112th Ave NE, Suite 150 Bellevue, WA 98004 T (425) 921-1098 KOREA Seoul Representative Office 20F Glass Tower 534 Teheran-ro Gangnam-gu, Seoul 06181 Korea T +82 (2) 3439-91201 1 Friday, July 28, 2017 will be the last day this branch will be open for business at the current location. 2016 ANNUAL REPORT / 18 2016 ANNUAL REPORT / 19 2016 ANNUAL REPORT / 20 T (213) 639-1700 National Geographic Presence Corporate Information Nationwide footprint with meaningful presence, providing full banking services to the largest Asian-American communities in the U.S. SEATTLE 4 branches + 1 SBA LPO PORTLAND SBA LPO NEW YORK / NEW JERSEY 10 branches DENVER SBA LPO ILLINOIS 7 branches SOUTHERN CALIFORNIA 34 branches + 2 Residential Mortgage LPOs NORTHERN CALIFORNIA 2 branches + 1 Commercial Lending LPO TEXAS 2 Dallas branches + 1 SBA LPO 1 Houston branch ALABAMA 1 branch GEORGIA 1 branch + 1 SBA LPO DC METRO 2 branches + 1 SBA LPO SEOUL REPRESENTATIVE OFFICE Hope Bancorp, Inc. and Bank of Hope Board of Directors Executive Officers Independent Auditors Steven S. Koh Chairman of the Board Chairman Pacific Steel Corporation Kevin S. Kim President & Chief Executive Officer Hope Bancorp, Inc. and Bank of Hope Scott Yoon-Suk Whang Lead Independent Director Founder and Chief Executive Officer Orange Circle Studios Donald D. Byun Former President Jay Dee, Inc. Steven J. Didion General Partner and Portfolio Manager JCSD Partners, LP Jinho Doo Chief Executive Officer Key Capital Management, LLC Daisy Y. Ha Attorney Lawrence Jeon* President Lawrence Jeon & Company Jin Chul Jhung Chairman & President Royal Imex, Inc. Chung Hyun Lee Former President NuArt International, Inc. David P. Malone Senior Executive Vice President & Chief Operating Officer Bank of Hope Craig Mautner* Former Senior Software Engineer Google, Inc. William J. Lewis Former Executive Vice President & Chief Credit Officer East West Bank John R. Taylor Former Senior Audit Partner KPMG LLP Dale S. Zuehls, PhD Principal Zuehls, Legaspi & Company * Retiring from the Board effective the 2017 Annual Meeting of Stockholders Kevin S. Kim President & Chief Executive Officer Hope Bancorp, Inc. and Bank of Hope David P. Malone Senior Executive Vice President & Chief Operating Officer Bank of Hope Kyu S. Kim Senior Executive Vice President & Regional President, Eastern Region Bank of Hope Douglas J. Goddard Executive Vice President & Chief Financial Officer Hope Bancorp, Inc. Alex Ko Executive Vice President & Chief Financial Officer Bank of Hope Daniel H. Kim Executive Vice President & Chief Strategy Officer Bank of Hope David W. Kim Executive Vice President & Chief Retail Banking Officer Bank of Hope Jason K. Kim Executive Vice President & Chief Commercial Banking Officer Bank of Hope Peter Koh Executive Vice President & Chief Credit Officer Bank of Hope Janette Mah Executive Vice President & Chief Mortgage Banking Officer Bank of Hope Lisa K. Pai Executive Vice President, Chief Administrative Officer & General Counsel Hope Bancorp, Inc. and Bank of Hope David Song Executive Vice President & Chief Lending Officer, Western Region Bank of Hope Brian E. Van Dyk Executive Vice President & Chief Information Officer Bank of Hope Johann (Min) You Executive Vice President & Chief Risk Officer Hope Bancorp, Inc. and Bank of Hope Crowe Horwath LLP Los Angeles, California SEC Counsel Mannatt, Phelps & Phillips, LLP Los Angeles, California Transfer Agent and Registrar If you have questions about stock certificates, or if you need to transfer shares or change the name in which they are registered, please contact: Computershare Trust Company, N.A. 250 Royall St Canton, MA 02021 T (877) 272-7494 www.computershare.com/investor Securities Listing Hope Bancorp, Inc.’s common stock is traded on the NASDAQ Global Select Market under the symbol HOPE. Investor Relations Angie Yang Senior Vice President, Director of Investor Relations & Corporate Communications T (213) 251-2219 angie.yang@bankofhope.com Offer of 10-K Report Shareholders may obtain without charge copies of Hope Bancorp’s 2016 Annual Report to the Securities and Exchange Commission on Form 10-K by sending a request to investor@bankofhope.com. Annual Meeting of Shareholders The Annual Meeting of Shareholders will be held at 10:30 a.m. on Thursday, July 6, 2017, at the Oxford Palace Hotel, 745 South Oxford Avenue, Los Angeles, California 90005. Corporate Headquarters 3200 Wilshire Blvd, Suite 1400 Los Angeles, CA 90010 T (213) 639-1700 2016 ANNUAL REPORT / 21 2016 ANNUAL REPORT / 22 T (213) 639-1700 

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