Hope Bancorp
Annual Report 2017

Plain-text annual report

The first and only super regional Korean-American bank in the United States Company Profile Hope Bancorp, Inc. is the holding company of Bank of Hope, one of the leading Asian-American banks in the United States. Headquartered in Los Angeles and with $14.2 billion in total assets as of December 31, 2017, Bank of Hope serves a multi-ethnic population of customers across the nation with full-service branches in California, Washington, Texas, Illinois, New York, New Jersey, Virginia, Georgia and Alabama. The Bank also operates SBA loan production offices in Seattle, Denver, Dallas, Atlanta, Portland, Oregon, New York City and Northern California; commercial loan production offices in Northern California and Seattle; residential mortgage loan production offices in California; and a representative office in Seoul, Korea. Building on the Bank’s expertise in small business lending, commercial real estate lending, C&I lending and international trade finance, Bank of Hope is today a diversified financial institution with an expanded offering of commercial and consumer products and services, including residential mortgage and warehouse lending, credit cards, equipment lease financial and foreign currency, among others. Having grown alongside the Bank’s customers fostering growth within its communities, Bank of Hope understands its markets well and is committed to help its customers achieve their financial goals. We are committed to improving the value of our services as BANKERS, providing comprehensive financial solutions as EXPERTS, and being good NEIGHBORS that foster growth for our customers and communities. The roots of Bank of Hope go back more than 37 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. 2017 ANNUAL REPORT / 1  Message to Stockholders Dear Valued Stockholders, Customers and Employees: Over the course of the last seven years, we have established the representative bank of our community by transforming a highly fragmented space. Bank of Hope stands proud today as the first and only super regional Korean-American Bank, the third largest Asian-American bank in the United States, and the only Korean-American bank to ever be named by Forbes magazine as one of the Best Banks in America, and that’s for the last six consecutive years. n Scott Yoon-Suk Whang Chairman of the Board n Kevin S. Kim President & Chief Executive Officer 2017 ANNUAL REPORT / 2 2017 ANNUAL REPORT / 3 Message to Stockholders Message to Stockholders Investment and Growth Our first full-year of operations as a $10 billion-plus financial institution was also a year of key investments that signifcantly fortified our foundation for sustainable growth. incremental income tax expense in the Company’s consolidated statements of income of $25.4 million resulting from the revaluation of our deferred tax assets and liabilities and low income housing tax credit investments due to the enactment of the Tax Cuts and Jobs Act (the “Tax Act”) on December 22, 2017. This one-time, non-cash charge, which was recognized during the 2017 fourth quarter, adversely impacted the Company’s diluted earnings per share by $0.19 per share. There were no Tax Act-related adjustments to the Company’s 2016 financial results. 2017 was a year of important achievements in terms of fortified our foundation for sustainable growth. Subject to the successfully completing the integration of a transformational significantly greater regulatory standards and requirements, the merger completed in 2016 and making progress toward our higher levels of investments in our risk infrastructure and DFAST Vision to build upon our Korean-American heritage and national preparedness certainly weighed on our performance in 2017. presence to be a top performer for our shareholders, customers, staff and communities. With the physical integration Despite these investments, net income for 2017 increased of the merger successfully completed, the Board of Directors 23% to a record $139.4 million, or $1.03 per diluted common and executive management team focused on driving profitable share, based on 135,684,969 weighted average diluted shares growth of our franchise and creating additional value for all of outstanding, from $113.7 million, or $1.10 per diluted common our stakeholders. share, based on 103,530,318 weighted average diluted shares Our first full-year of operations as a $10 billion-plus financial outstanding, in 2016. institution was also a year of key investments that significantly Our 2017 financial results included a one-time, non-cash, . $ 1 4 2 0 b i l l i o n . $ 1 0 8 5 b i l l i 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 o n $ 1 3 9 4 m . i l l i o n Financial Highlights Solid Financial Results Despite Significant Investments . $ 1 1 1 0 b i l l i o n 2013 2014 2015 2016 2017 BANKERS 2013 2014 2015 2016 2017 2017 ANNUAL REPORT / 4 2017 ANNUAL REPORT / 5 . $ 1 9 2 b i l l i o n . 1 3 6 6 % 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Message to Stockholders Message to Stockholders Asset-Based Lending CRE Lending Wealth Management Treasury Management Solutions Int’l Trade Finance Diversification Expanded Offering of Products and Services Generating a More Diversified Revenue Stream operational efficiencies in the lending process. The transformation also positions our frontline to focus on the specialized needs of our commercial business banking clients and branch-based consumer customers. We believe these changes will create greater opportunities leading to stronger and healthier growth for Bank of Hope for the At year-end, total assets increased 6% over 2016 to $14.21 long term. billion, loans receivable increased 5% to $11.10 billion and total deposits increased 2% to $10.85 billion. These Notwithstanding the significant amount of energy achievements ranked Bank of Hope as the 6th largest bank devoted to the successful integration and transformation headquartered in Los Angeles, the 11th largest bank in of our organization, Bank of Hope originated a record $2.59 California, and the 85th largest financial institution billion in new loans to support the growth of its customers, in the nation. amounting to a 39% increase over 2016 production volumes. We are pleased to report that our originations in As of December 31, 2017, the Company maintained 2017 represent a more diversified mix of loan production robust capital levels with total risk-based capital at with increasing contributions from some of our newer 13.82%, leverage ratio at 11.54%, and common equity product offerings. tier 1 capital at 12.30%. Given the solid financial performance notwithstanding the considerable investments in our organization, our Board of Directors Credit Card further increased the common dividend to our stockholders for the fifth consecutive year to $0.13 per common share. Today, the Bank of Hope team of nearly fifteen hundred is made up of a mosaic of staff whose origins come from numerous legacy organizations, as Our Mission is to be the first choice partner for our well as Bank of Hope. Not only do we have a considerably target corporate, middle market and small businesses increased number of employees, but a significantly by providing a comprehensive set of business products greater depth of expertise. And we can say with greater and services, while being the premier bank for the confidence than ever that we have one of the target consumers in the communities we serve strongest leadership teams among Asian-American Banks. nationwide. Bank of Hope originated a record $2.59 billion in new loans to support the growth of its customers, amounting to a 39% increase over 2016 production volumes. Residential Warehouse Lending Foreign Currency Residential Mortgage Equipment Lease Financing During the course of the year, we implemented a Bank of Hope is in an enviable competitive position, SBA Lending corporate transformation plan designed to enhance with unrivaled leadership among our niche peers and our progress with diversifying our revenue streams and unparalleled opportunity to cross-sell a comprehensive improve the overall work flow by providing greater offering of products and services. Beyond our initial core Commercial Lending 2017 ANNUAL REPORT / 6 2017 ANNUAL REPORT / 7 Message to Stockholders Message to Stockholders EXPERTS strengths in international trade finance, SBA and commercial As a community-based bank, Bank of Hope remains committed real estate lending, we have become a diversified financial to supporting its communities through various forms of Photo courtesy of Gabriel Roux Photography. Supporting Our Communities As a community-based bank, Bank of Hope remains committed to supporting its communities through various forms of investments and contributions. Partnering with United Way For the third consecutive year, Bank of Hope partnered with United Way of Greater Los Angeles and participated in the annual United Way HomeWalk, a 5K Walk and Fun Run that mobilizes thousands of Angelenos to raise awareness and funds to end homelessness in Los Angeles County, home to Bank of Hope. In addition to a $10,000 grant to support the event, a total of 177 Bank of Hope teammates raised funds and completed the 5K Walk/Run. institution with a strong residential mortgage platform, the only investments and contributions. Korean-American bank-issued credit card program and other specialty services, including equipment lease financing, foreign Hope Scholarship Foundation currency and wealth management. Bank of Hope is also the only Korean-American bank with a true national footprint and solid presence in all top geographic markets in the U.S. with the largest Asian-American In 2017, Bank of Hope contributed $140,000 to the Hope populations. Scholarship Foundation. In partnership with the Asian & Pacific Island American Scholarship Fund (APIASF), scholarships We have a tremendous opportunity to establish deeper were awarded to 52 students who demonstrated strong and stronger relationships with our existing customer base academic performance, leadership capabilities and a need just by cross-selling our other products and services. More for financial assistance as they were preparing to enroll in their importantly, we believe our diversified offering and first year of college. geographic footprint, coupled with our greater stature in the banking community, position Bank of Hope well to Since the establishment of the Hope Scholarship Foundation successfully expand into newer markets and a broader in 2001, Bank of Hope has supported the youth in its customer base. communities through more than $1.8 million in contributions. Bank of Hope Founders Cup Also during the year, Bank of Hope supported United Way For the second consecutive year, Bank of Hope served as the title health and financial stability through a United Way 2017 sponsor to the LPGA Founders Cup Tournament. We believe Workplace Giving Campaign. In our inaugural campagn, our that Bank of Hope shares many similarities and values with the employees pledged more than $25,000 in contributions, LPGA, and especially the Founders Cup. The Bank of Hope which was further supported by a generaous 15% and their community work focused on education, housing, Founders Cup honors the 13 visionary women who established corporate match. the LPGA in 1950. The premier women’s professional sports organization in the world today, the LPGA has maintained a Hurricane Harvey Relief Fund strong focus on giving back to its communities. Last September, we watched with great concern the news Like the LPGA, Bank of Hope was founded by visionaries who coverage of the devastating damage and flooding caused by established the Bank to serve the growing needs of an emerging Hurricane Harvey. Like a good neighbor, Bank of Hope acted immigrant community, and we too have maintained strong swiftly to support the community and the recovery process ties with our communities. As such, we are excited to partner in the aftermath of the flooding. For immediate assistance, with the LPGA and proud of the fact that the Bank of Hope Bank of Hope delivered a corporate donation of $25,000 Founders Cup tournament proceeds are donated to the to a Houston-based non-profit organization focused on LPGA-USGA Girls Golf program. supporting the community. A Hurricane Harvey Relief Fund 2017 ANNUAL REPORT / 8 2017 ANNUAL REPORT / 9 Message to Stockholders Message to Stockholders NEIGHBORS was also immediately established and our employees and undertaking strengthen our competitive position and will lead board members donated personal cash and accrued vacation to enhanced operational efficiencies and financial performance totaling more than $75,000, for an aggregate $100,000 in for years to come. With renewed energy and conviction, we are contributions to help those affected by the disaster. confident that the future of Bank of Hope looks stronger than it has ever been, and we look forward to delivering greater returns Bank of Hope’s Core Values are designed to guide the actions to our customers, employees, communities and shareholders. and behavior of our people and reflect the corporate culture that we are building. The acronym – IT FITS – was developed to On behalf of the entire Board of Directors, we express our reinforce the communication of these values, which include deepest appreciation to our employees for their tireless Integrity, Transparency, Fairness, Initiative, Teamwork and efforts and dedication, our customers for their loyal patronage, Satisfaction. our regulators for their collaborative guidance and our stockholders for their ongoing trust and support. Bank of Hope is committed to improving the value of our service as Bankers, providing comprehensive financial solutions as Experts, and being good Neighbors that foster Sincerely, growth for our customers and communities. Looking ahead into 2018 and beyond, we are well positioned as one of the leading Asian-American banks in the country with solid presence in all of the top targeted geographic markets. We believe the investments and initiatives that we are currently Scott Yoon-Suk Whang Chairman of the Board Kevin S. Kim President & Chief Executive Officer Corporate Social Responsibility Highlights 1 OUT OF 2 1000 HOURS $2.59 BILLION 1 out of 2 Bank of Hope branches located in low-to-moderate income areas Nearly 1000 hours of CRA-reportable volunteer hours $2.59 billion of loans funded in 2017 $500 MILLION $10 MILLION $1.8 MILLION $500 million of CRA-reportable small business lending in 2017 $10 million of donations and sponsorships over last 10 years $1.8 million of contributions to the Hope Scholarship Foundation since 2001 In addition to financing economic growth, we believe our responsibilities include helping the communities in which we live and work grow and flourish through volunteerism and philanthropy. 2017 ANNUAL REPORT / 10 2017 ANNUAL REPORT / 11 Selected Financial Data Selected Financial Data (dollars in thousands, except share and per share data) 2017 2016 2015 2014 2013 (dollars in thousands) 2017 2016 2015 2014 2013 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 $ 572,104 $ 421,934 $ 313,660 $ 302,657 $ 283,073 $ 90,724 $ 58,579 $ 40,618 $ 36,060 $ 30,018 $ 481,380 $ 363,355 $ 273,042 $ 266,597 $ 253,055 $ 17,360 $ 9,000 $ 8,000 $ 12,638 $ 20,000 Net interest income after provision for loan losses $ 464,020 $ 354,355 $ 265,042 $ 253,959 $ 233,055 Noninterest income Noninterest expense $ 66,415 $ 51,819 $ 43,691 $ 44,187 $ 42,719 $ 266,601 $ 214,975 $ 153,384 $ 151,624 $ 141,620 Income before income tax provision $ 263,834 $ 191,199 $ 155,349 $ 146,522 $ 134,154 Income tax provision Net income Per Common Share Data Earnings _ basic Earnings _ diluted $ 124,389 $ 77,452 $ 63,091 $ 57,907 $ 52,399 $ 139,445 $ 113,747 $ 92,258 $ 88,615 $ 81,755 $ 1.03 $ 1.10 $ 1.16 $ 1.11 $ 1.03 $ 1.03 $ 1.10 $ 1.16 $ 1.11 $ 1.03 Book value (period end, excluding warrants) $ 14.23 $ 13.72 $ 11.79 $ 11.10 $ 10.18 Cash dividends declared per common share $ 0.50 $ 0.45 $ 0.42 $ 0.35 $ 0.25 Number of common shares outstanding (period end) $135,511,891 $135,240,079 $79,566,356 $79,503,552 $79,441,525 Balance Sheet Data—At Period End Assets $ 14,206,717 $ 13,441,422 $ 7,912,648 $ 7,140,330 $ 6,475,199 Securities available for sale $ 1,720,257 $ 1,556,740 $ 1,010,556 $ 792,523 $ 701,751 Loans receivable, net of unearned loan fees and discounts (excludes loans held for sale) $ 11,102,575 $ 10,543,332 $ 6,248,341 $ 5,565,192 $ 5,074,175 Deposits $ 10,846,609 $ 10,642,035 $ 6,340,976 $ 5,693,452 $ 5,148,057 Federal Home Loan Bank advances and federal funds purchased Subordinated debentures Stockholders’ equity Average Balance Sheet Data Assets $ 1,227,593 $ 754,290 $ 530,591 $ 480,975 $ 421,352 $ 100,853 $ 99,808 $ 42,327 $ 42,158 $ 57,410 $ 1,928,255 $ 1,855,473 $ 938,095 $ 882,773 $ 809,374 $ 13,648,963 $ 10,342,063 $ 7,389,530 $ 6,830,244 $ 6,042,674 Securities available for sale $ 1,679,468 $ 1,276,068 $ 871,010 $ 713,775 $ 699,812 Gross loans, including loans held for sale $ 10,642,349 $ 8,121,897 $ 5,846,658 $ 5,355,243 $ 4,692,089 Deposits Stockholders’ equity $ 10,751,886 $ 8,232,984 $ 5,879,704 $ 5,439,920 $ 4,739,261 $ 1,907,746 $ 1,342,954 $ 912,609 $ 848,443 $ 788,570 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 2017 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 1.02% 7.31% 13.98% 48.54% 3.46% 3.80% 4.51% 1.05% 48.67% 12.30% 11.54% 13.11% 13.82% 12.95% 11.40% 12.95% 13.66% 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% 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% $ 46,775 $ 407 $ 67,250 $ 114,432 $ 10,787 $ 125,219 $ 40,074 $ 305 $ 48,874 $ 89,253 $ 21,990 $ 111,243 $ 40,801 $ 46,353 $ 375 $ 361 $ 47,984 $ 57,128 $ 89,160 $ 103,842 $ 21,035 $ 21,938 $ 110,195 $ 125,780 $ 39,154 $ 5 $ 33,903 $ 73,062 $ 24,288 $ 97,350 0.42% 1.03% 0.88% 1.13% 0.76% 180.74% 73.88% 67.51% 0.11% 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% 0.77% 1.44% 1.50% 1.91% 1.33% 171.94% 92.14% 69.15% 0.42% (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 $18.1 million, $19.6 million, $12.2 million, $30.4 million and $43.8 million as of December 31, 2017, 2016, 2015, 2014 and 2013 , respectively 2017 ANNUAL REPORT / 12 2017 ANNUAL REPORT / 13 Leadership We are proud to have one of the strongest leadership teams among Asian-American banks. Risk Management Operations Oversight Business Leadership Lisa K. Pai Executive Vice President & General Counsel Johann (Min) You Executive Vice President & Chief Risk Officer Peter Koh Executive Vice President & Chief Credit Officer Karen Craigmile Executive Vice President & Chief Internal Audit Executive Daniel H. Kim Executive Vice President & Chief Strategy Officer David P. Malone Senior Executive Vice President & Chief Operating Officer Alex Ko Executive Vice President & Chief Financial Officer David W. Kim Executive Vice President & Chief Retail Banking Officer David Song Executive Vice President & Chief Business Banking Officer Kyu S. Kim Senior Executive Vice President & Eastern Region President Janette Mah Executive Vice President & Chief Mortgage Banking Officer Kevin S. Kim President & Chief Executive Officer Jason K. Kim Executive Vice President & Chief Commercial Banking Officer Steven C. Canup Executive Vice President & Managing Director, Corporate Banking Group 2017 ANNUAL REPORT / 14 2017 ANNUAL REPORT / 15  Scott Yoon-Suk Whang Chairman of the Board Founder and Chairman Orange Circle Studios Kevin S. Kim President & Chief Executive Officer Hope Bancorp, Inc. and Bank of Hope Steven S. Koh Honorary Chairman Chairman Pacific Steel Corporation Chung Hyun Lee Former President NuArt International, Inc. John R. Taylor Former Senior Audit Partner KPMG LLP Jin Chul Jhung Chairman & President Royal Imex, Inc. Donald D. Byun Former President Jay Dee, Inc. 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 Dale S. Zuehls, PhD Principal Zuehls, Legaspi & Company William J. Lewis Former Executive Vice President & Chief Credit Officer East West Bank Board of Directors Hope Bancorp, Inc. and Bank of Hope Hope Bancorp, Inc. and Bank of Hope 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. 2017 ANNUAL REPORT / 16 2017 ANNUAL REPORT / 17 Location Information Location Information (continued) Location Information (continued) 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-Beverly 253 N Western Ave Los Angeles, CA 90004 T (213) 381-2222 Western-9th 841 S Western Ave Los Angeles, CA 90005 T (213) 387-7070 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 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 Los Angeles Regional Office 3731 Wilshire Blvd, 3rd Floor Los Angeles, CA 90010 T (213) 639-1700 Buena Park Office 5254 Beach Blvd Buena Park, CA 90621 T (562) 345-3102 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 Wilshire Office 3200 Wilshire Blvd Los Angeles, CA 90010 T (213) 365-3303 Premier Banking Group Olympic-Western Office 3267 W Olympic Blvd, 2nd Floor Los Angeles, CA 90006 T (213) 235-3113 SBA Department 3200 Wilshire Blvd, 7th Floor Los Angeles, CA 90010 T (877) 627-2722 Mortgage Banking Division 3200 Wilshire Blvd, 4th Floor Los Angeles, CA 90010 T (866) 972-2265 Beverly Hills LPO 9595 Wilshire Blvd, Suite 400 Beverly Hills, CA 90212 T (866) 972-2265 Gardena/Torrance LPO 1655 W Redondo Beach Blvd, 3rd Floor Gardena, CA 90247 T (310) 327-2222 Newport Beach LPO 24 Corporate Plaza, Suite 180 Newport Beach, CA 92660 T (949) 999-7900 South Bay LPO 2447 Pacific Coast Hwy, Suite 101 Hermosa Beach, CA 90254 T (866) 972-2265 Corporate Banking Group 3200 Wilshire Blvd, 2nd Floor Los Angeles, CA 90010 T (213) 427-6530 Syndicated Lending Group 3200 Wilshire Blvd, 10th Floor Los Angeles, CA 90010 T (213) 427-6321 Credit Card Department 3200 Wilshire Blvd, 11th Floor Los Angeles, CA 90010 T (213) 355-2850 Commercial Equipment Lease Financing Department 3731 Wilshire Blvd, 3rd Floor Los Angeles, CA 90010 T (213) 805-8230 Investment Services 3267 W Olympic Blvd Los Angeles, CA 90006 T (213) 201-3600 NORTHERN CALIFORNIA Branches Oakland 1939 Harrison St, Suite 110 Oakland, CA 94612 T (510) 302-0505 Silicon Valley 1102 E El Camino Real Sunnyvale, CA 94087 T (408) 557-2000 Commercial Loan Center 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 Commercial Loan Center PNW Region Loan Center 3500 188th St SW, Suite 234 Lynnwood, WA 98037 T (253) 946-1067 TEXAS Branches Dallas 2237 Royal Ln Dallas, TX 75229 T (972) 919-9999 Houston-Spring 13890 Blalock Rd Houston, TX 77055 T (281) 407-3355 Commercial Loan Center South Central Region Loan Center 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 Glenview 1645 N Milwaukee Ave Glenview, IL 60025 T (855) 329-2226 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 Niles Market 801 Civic Center Dr, Suite 155 Niles, IL 60714 T (847) 965-2402 Fort Worth 7553 Boulevard 26 North Richland Hills, TX 76180 T (817) 514-4600 Skokie 5526 Touhy Ave Skokie, IL 60077 T (773) 736-1300 NCA Region Loan Center 47102 Mission Falls Ct, Suite 100 Fremont, CA 94539 T (510) 550-8000 Houston 10000 Harwin Dr Houston, TX 77036 T (713) 774-0411 Denver LPO 2851 S Parker Rd, Suite 1120 Aurora, CO 80014 T (720) 535-5060 New York LPO 162-05 Crocheron Ave Flushing, NY 11358 T (718) 412-9055 Northern California LPO 1939 Harrison St, Suite 190 Oakland, CA 94612 T (510) 899-6803 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, Korea 06181 T +82 (2) 3439-9120 Eastern Region Loan Center- Manhattan 307 Fifth Ave, 5th Floor New York, NY 10001 T (212) 279-2790 Premier Commercial Banking Division Manhattan Office 16 W 32nd St New York, NY 10001 T (212) 279-2790 Eastern Region SBA Department Flushing-Union 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 Commercial Loan Center Eastern Region Loan Center- New Jersey 211 Broad Ave Palisades Park, NJ 07650 T (201) 720-3900 Commercial Loan Center 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 Regional Headquarters, Eastern Region 16 W 32nd St New York, NY 10001 T (212) 279-2790 VIRGINIA Branches Annandale 7410 Little River Tpke Annandale, VA 22003 T (203) 354-4310 Centreville 13890 Braddock Rd Centreville, CA 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 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 2017 ANNUAL REPORT / 18 2017 ANNUAL REPORT / 19 2017 ANNUAL REPORT / 20 Corporate Information Hope Bancorp, Inc. and Bank of Hope Board of Directors Scott Yoon-Suk Whang Chairman of the Board Founder and Chairman Orange Circle Studios Kevin S. Kim President & Chief Executive Officer Hope Bancorp, Inc. and Bank of Hope Steven S. Koh Honorary Chairman Chairman Pacific Steel Corporation 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 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 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 Executive Officers Independent Auditors 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 & Eastern Region President Bank of Hope Alex Ko Executive Vice President & Chief Financial Officer Hope Bancorp, Inc. and Bank of Hope Peter Koh Executive Vice President & Chief Credit Officer Bank of Hope Steven C. Canup Executive Vice President & Managing Director, Corporate Banking Group Bank of Hope Karen Craigmile Executive Vice President & Chief Internal Audit Executive 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 Janette Mah Executive Vice President & Chief Mortgage Banking Officer Bank of Hope Lisa K. Pai Executive Vice President & General Counsel Hope Bancorp, Inc. and Bank of Hope David Song Executive Vice President & Chief Business Banking 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 2017 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, May 24, 2018, 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 SEOUL REPRESENTATIVE OFFICE National Geographic Presence Nationwide footprint with meaningful presence, providing full banking services to the largest Asian-American communities in the U.S. SOUTHERN CALIFORNIA 33 branches + 4 Residential Mortgage LPOs NEW YORK & NEW JERSEY 10 branches + 2 Commercial Lending LPOs + 1 SBA LPO ILLINOIS 6 branches WASHINGTON 4 branches + 1 Commercial Lending LPO + 1 SBA LPO NORTHERN CALIFORNIA 2 branches + 1 Commercial Lending LPO + 1 SBA LPO TEXAS 2 Dallas branches + 2 Houston branches + 1 SBA LPO VIRGINIA 2 branches GEORGIA 1 branch + 1 SBA LPO ALABAMA 1 branch PORTLAND SBA LPO DENVER SBA LPO - HOPE 2017 Form 10-K - Introduction to Bank of Hope - Bank of Hope EZ Loan Ad - Bank of Hope Mortgage Ad To request printed copies of the Company’s 2017 Form 10-K, please send an email to investor@bankofhope.com. 2017 ANNUAL REPORT / 21 2017 ANNUAL REPORT / 22 The Hope Bancorp 2017 Annual Report has not been reviewed, or confirmed for accuracy or relevance, by the Federal Deposit Insurance Corporation. 

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