Hope Bancorp
Annual Report 2020

Plain-text annual report

ANNUAL REPORT 2020 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 $17.1 billion in total assets as of December 31, 2020, 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 and Alabama. The Bank also operates SBA loan production offices in Seattle, Houston, Denver, Dallas, Atlanta, Portland, Oregon, Virginia, 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 financing 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. Bank of Hope Headquarters 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. 2020 ANNUAL REPORT / 1 Welcome to Bank of Hope! Bank of Hope has been providing financial services to the Korean American community for 40 years and is today one of the leading Asian American banks in the United States. Message to Stockholders Dear Valued Stockholders, Customers and Employees: degrees and held professional jobs before moving to the U.S., language barriers prevented many from finding jobs commensurate with their education and work experience. 2020 was a special year for Bank of Hope as we celebrated As a result, a typical newly arrived family in the 1970s would the 40th anniversary of our establishment. Bank of Hope start a small business after a few years of work as a low- has been providing financial services to the Korean skilled laborer. Koreans have shown a strong tradition of American community for 40 years and is today one of the entrepreneurship, and their tendency to enter into business leading Asian-American banks in the United States. has been one of the highest among all ethnic groups as A look at the history of how we came to be, the culture of the one-third of Korean immigrant households engage in a evidenced by numerous surveys that confirm that about 1980 Since The beginnings of Korean American banking communities that we serve and the business environment self-owned business. that we have operated in provides a better understanding of our Company as we stand today. With an increasing number of Korean American-owned Following the passage of the 1965 Immigration and Los Angeles, a need for financial services for this emerging Naturalization Act, which allowed family and employment immigrant community arose, and therein lies where our roots small businesses in the commercial district of downtown immigration, the annual number of Korean immigrants were sown. steadily increased, and the Korean diaspora community became the largest group of immigrants to move to America In 1980, Wilshire Bank, the first of the three root banks from 1976 to 1990. Los Angeles received the biggest wave of Bank of Hope, was founded by, among others, a number of Korean immigrants during this period, followed by New of Korean Americans with a focus on serving the financial needs York and Chicago. of a sprawling Koreatown. Center Bank was established in While a majority of Korean immigrants earned college successful Korean American entrepreneurs and professionals. 1986 and Nara Bank in 1988 by founders comprised entirely of 2020 ANNUAL REPORT / 2 n Kevin S. Kim Chairman, President & Chief Executive Officer 2020 ANNUAL REPORT / 3 Message to Stockholders Message to Stockholders A time of rapid growth and expansion beyond Southern California from the mid-1990s through the mid-2000s, the root banks Having successfully emerged from the financial crisis presence in Seattle and Chicago with the acquisitions of grew at a rapid pace and began expanding their presence in 2010, Center Bank and Nara Bank agreed to merge Pacific International Bank and Foster Bank, respectively. beyond Southern California to other geographic markets with to form a larger bank with a stronger capital base and Moreover, the Bank began diversifying its product offering As community banks focused on serving the needs of their large populations of Korean American-owned businesses. core customer base, the root banks initially specialized The root banks also began listing on NASDAQ beginning a greater ability to absorb the higher with the launch of equipment lease financing, the only Korean American bank-issued credit card, wealth management in small business lending and international trade finance in 1998 and garnered broad attention by the investment costs associated with and residential mortgage. and beginning in the 1990s became active SBA lenders. community for their high growth and profitability. increased regulatory As more of the core business customer base achieved burdens following the Great Recession. The first merger During this same time frame, Wilshire Bank expanded into the financial wealth and began purchasing the commercial Given the strong financial performance and accomplishments of equals between Center and Nara was completed on Southeast with branch openings in Alabama and Georgia and properties in which they operated their businesses, the achieved by the root banks, as well as the public stature November 30, 2011. strengthened its presence in New York and Los Angeles with 1990 to mid 2000s Rapid growth and expansion 2011 Transformational mergers of equals 2016 banks also became active in commercial real estate lending. gained by their founding directors, Korean American de-novo This created BBCN Bank and transformed the Korean the acquisitions of BankAsiana and Saehan Bank, respectively. banks began to proliferate in Los Angeles and across other American banking landscape as the first friendly In the early 1990s, the U.S. economy was already in recession parts of the country beginning in 2001. merger that was not a result of regulatory pressure. On July 29, 2016, the second merger of equals was complet- following the S&L Crisis in 1989. To top it all, the Korean ed between BBCN Bank and Wilshire Bank, creating Bank of American community was horrified as over 2,200 Korean- However, the U.S. economy was hit with the subprime The merger was completed at a time when many banks owned businesses were looted, completely destroyed, or mortgage crisis in 2007, triggered by a large decline in home were still struggling with capital deficiencies and continuing damaged during the Los Angeles riots of 1992, with estimated prices after the collapse of a housing bubble, leading to to pull back on lending. This enabled the Bank to better damages of $400 million. But the community came together mortgage delinquencies, foreclosures, and the devaluation of navigate the challenging economic and interest rate Hope with total assets in excess of $13 billion. This merger combined the top two commercial lenders and with the support of Korean American banks, Koreatown housing-related securities. This led to the Great Recession, and environment, and to ultimately gain market share and in the Korean American banking space and created for the proved resilient and rose from the ashes of the LA riots. unprecedented fiscal, monetary, and regulatory policy was grow the franchise as economic conditions improved. first time a super regional Korean American bank with the only During a time of strong economic growth, steady job estate market valuations severely impacted liquidity and capital as the dominant Korean American bank in Southern all of the top major geographic markets with sizeable Asian creation, low inflation and rising productivity in the U.S. positions, and U.S. bank failures ballooned in 2009 and 2010. California and New York, and the Bank expanded its American communities in the U.S. The combination created unleashed by federal authorities. The collapse in commercial real The combination also created a broader national platform true nationwide platform providing full banking services in 2020 ANNUAL REPORT / 4 2020 ANNUAL REPORT / 5 Message to Stockholders Message to Stockholders 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. bear fruit. We originated a well-balanced mix of loans that to 1.72% for 2020 from 1.86% for 2019, and our efficiency resulted in a significant year-over-year improvement in ratio improved to 54.45% for 2020 from 54.74% for 2019. the composition of our loan portfolio with commercial an unrivaled organization that represented greater than important racial justice movement, widespread social unrest, loans increasing to 30% of total loans at year-end 2020 Asset quality remained relatively healthy notwithstanding the 50% of total assets, loans and deposits of all Korean and a bitter political environment. Difficult times, however, from 22% a year earlier, and commercial real estate loans impact of the pandemic on the business community. Nonper- American banks in the country. often inspire adaptation and even growth. As an organization, decreasing to 65% from 71%, over the same time period. forming assets represented 0.84% of total assets at December As Bank of Hope, we committed to improving the value of immediately recognized the essential, supportive role our Bank Thanks in part to our growing base of middle-market continued to be very low with net charge offs of 7 basis points our services as Bankers, providing comprehensive financial plays for our customers and communities in times of need. customers, deposits increased 14% year-over-year to $14.33 of average loans in 2020, compared with 4 basis points in 2019. we came together with hope in our pandemic response and 31, 2020, versus 0.78% a year earlier. Our loss experience solutions as Experts, and being good Neighbors that Despite the extraordinarily challenging business environment, billion at December 31, 2020 from $12.53 billion at year- foster growth for our customers and communities. we persevered and delivered another year of consistent end 2019. More importantly, our deposit composition The implementation of the Current Expected Credit Losses 2020 The only super regional Korean American bank B a n k e r s | E x p e r t s | N e i g h b o r s And as a regional bank, we have been making significant execution of our strategic priorities. improved dramatically with noninterest bearing deposits methodology effective January 1, 2020 and the additional investments in our organization that initially were necessary increasing to 34% of total deposits at year-end 2020 from increase in reserves in light of the pandemic’s impact on as we passed the $10 billion threshold for financial Although the business environment was extremely challenged 25% the prior year. This favorable shift in our deposit certain business sectors resulted in our provision for credit institutions. But we also have been making investments with the pandemic shutdowns, our continued success in base to lower-costing core deposits contributed to a losses totaling $95.0 million for 2020, compared with $7.3 beyond the initial requirements in our infrastructure, in our banking middle-market commercial borrowers and active considerable reduction in our total cost of deposits to 81 million in 2019 under the former Incurred Loss methodology. processes and workflow, and in our people and capabilities participation in the SBA Paycheck Protection Program basis points for 2000 from 158 basis points for 2019. to support the longer-term growth of our franchise. As a contributed to new loan originations of $3.08 billion in 2020, This had a material but expected impact on our profitability, result, we became stronger and sounder year-after-year. a significant increase over $2.49 billion in the prior year. Loans We are also pleased that while total assets at December 31, and net income totaled $111.5 million in 2020, compared with Along comes 2020, a year, unlike any other in our history, 10% over $12.18 billion at December 31, 2019. We are pleased billion at year-end 2019, this growth was achieved with was 0.68%, compared with 1.12% in 2019, and our return on engulfed by a global COVID-19 pandemic that led to that our corporate transformation plan designed to enhance minimal increase in our noninterest expenses. As a percent average stockholders’ equity was 5.49% for 2020, versus 8.63% unprecedented government actions, as well as the the diversification of our revenue streams has begun to age of average assets, noninterest expense decreased for 2019. receivable at year-end 2020 totaled $13.56 billion, increasing 2020 increased 9% year-over-year to $17.11 billion from $15.67 $171.0 million in 2019. Our return on average assets for 2020 2020 ANNUAL REPORT / 6 2020 ANNUAL REPORT / 7 Message to Stockholders Corporate Social Responsibility Highlights At year-end 2020, the Company continued to maintain Without a doubt, 2020 required more of our employees robust capital levels with total risk-based capital at 12.87%, than ever, whether they were frontline staff servicing leverage ratio at 10.22%, and common equity tier 1 capital at 10.94%. Underscoring the confidence of our board and management, we maintained an attractive quarterly dividend at $0.14 per share throughout the pandemic in 2020. the essential banking needs of our customers or our back-office staff, many of whom were challenged to maintain Our solid financial performance in 2020 affirmed Bank high productivity levels while working remotely. On of Hope’s position as one of the leading Asian American behalf of the entire Board of Directors, we express our banks in the country. We have a robust capital position deepest appreciation to our employees for their dedication to support future growth, ample liquidity and a diversified and commitment in these most challenging times. Current & Future 2020 Strengthened foundation for enhanced financial performance in the years ahead deposit and loan portfolio. Together with our board and We also thank our customers for their loyal patronage, management’s commitment to operational efficiencies our regulators for their collaborative guidance and our while continuing to invest in our organization, we believe stockholders for their ongoing support. we have strengthened the foundation for enhanced financial performance in the years ahead. As a result of the extraordinary challenges that we successfully endured during this unprecedented period, As we accept the realities of 2020 and look forward into I have greater conviction that we are a stronger franchise 2021, we acknowledge that the pandemic will continue today than ever before and more confidence in our ability to impact us in many ways, and a full economic recovery will to deliver enhanced value to all the stakeholders of certainly take longer than 2021. We are committed to moving Bank of Hope. forward with necessary adjustments prompted by these realities, including an acceleration of investments in our digital Sincerely, capabilities, so that we can be better prepared for a greater tomorrow post-COVID-19. Kevin S. Kim Chairman, President & Chief Executive Officer Bank of Hope was founded by members of the community 40 years ago to serve the growing financial needs of an emerging immigrant population. Our commitment to foster growth in the communities in which we live and work is deeply rooted in our corporate philosophy. In addition to financing economic growth, we have a long history of supporting our communities through various forms of investments, charitable donations and volunteerism. 1 OUT OF 2 1 out of 2 Bank of Hope branches located in low-to-moderate income areas 450 HOURS CRA-reportable volunteer hours in 2020 reflecting impact of COVID-19 $3.1 BILLION $3.1 billion of loans funded in 2020 $700 MILLION More than $700 million of CRA-reportable lending in 2020 $10 MILLION $10 million of donations and sponsorships over last 10 years $2.3 MILLION $2.3 million of contributions to the Hope Scholarship Foundation since 2001 2020 ANNUAL REPORT / 8 2020 ANNUAL REPORT / 9 Selected Financial Data Selected Financial Data (dollars in thousands, except share and per share data) 2020 2019 2018 2017 2016 (dollars in thousands) 2020 2019 2018 2017 2016 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 credit losses $ 598,878 $ 684,786 $ 650,172 $ 572,104 $ 421,934 131,380 218,191 162,245 90,724 58,579 467,498 466,595 487,927 481,380 363,355 95,000 7,300 14,900 17,360 9,000 Net interest income after provision for credit losses 372,498 459,295 473,027 464,020 354,355 Noninterest income Noninterest expense 53,432 49,683 60,180 66,415 51,819 283,639 282,628 277,726 266,601 214,975 Income before income tax provision 142,291 226,350 255,481 263,834 191,199 Income tax provision Net income Per Common Share Data Earnings _ basic Earnings _ diluted Book value (period end) 30,776 55,310 65,892 124,389 77,452 $ 111,515 $ 171,040 $ 189,589 $ 139,445 $ 113,747 $ 0.90 $ 1.35 $ 1.44 $ 1.03 $ 1.10 $ 0.90 $ 1.35 $ 1.44 $ 1.03 $ 1.10 $ 16.66 $ 16.19 $ 15.03 $ 14.23 $ 13.72 Cash dividends declared per common share $ 0.56 $ 0.56 $ 0.54 $ 0.50 $ 0.45 Number of common shares outstanding (period end) 123,264,864 125,756,543 126,639,912 135,511,891 135,240,079 Balance Sheet Data—At Period End Assets $ 17,106,664 $ 15,667,440 $ 15,305,952 $ 14,206,717 $ 13,441,422 Securities available for sale $ 2,285,611 $ 1,715,987 $ 1,846,265 $ 1,720,257 $ 1,556,740 Loans receivable, net of unearned loan fees and discounts (excludes loans held for sale) $ 13,563,213 $ 12,276,007 $ 12,098,115 $ 11,102,575 $ 10,543,332 Deposits $ 14,333,912 $ 12,527,364 $ 12,155,656 $ 10,846,609 $ 10,642,035 FHLB advances and federal funds purchased $ 250,000 $ 625,000 $ 821,280 $ 1,227,593 $ 754,290 Subordinated debentures Convertible notes, net Stockholders’ equity Average Balance Sheet Data Assets $ 104,178 $ 103,035 $ 101,929 $ 100,853 $ 99,808 $ 204,565 $ 199,458 $ 194,543 $ - $ - $ 2,053,745 $ 2,036,011 $ 1,903,211 $ 1,928,255 $ 1,855,473 $ 16,515,102 $ 15,214,412 $ 14,749,166 $ 13,648,963 $ 10,342,063 Securities available for sale $ 1,899,948 $ 1,796,412 $ 1,772,080 $ 1,679,468 $ 1,276,068 Gross loans, including loans held for sale $ 12,698,523 $ 11,998,675 $ 11,547,022 $ 10,642,349 $ 8,121,897 Deposits Stockholders’ equity $ 13,560,531 $ 12,066,719 $ 11,628,177 $ 10,751,886 $ 8,232,984 $ 2,032,570 $ 1,981,811 $ 1,910,224 $ 1,907,746 $ 1,342,954 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 2020 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 0.68% 5.49% 12.31% 62.22% 2.58% 3.00% 3.84% 1.26% 1.12% 8.63% 13.03% 41.54% 2.65% 3.27% 4.81% 2.16% 1.29% 9.92% 12.95% 37.58% 3.04% 3.53% 4.71% 1.67% 1.02% 7.31% 13.98% 48.54% 3.46% 3.80% 4.51% 1.05% 1.10% 8.47% 12.99% 40.86% 3.49% 3.75% 4.36% 0.87% 54.45% 54.74% 50.67% 48.67% 51.78% 10.94% 10.22% 11.64% 12.87% 12.90% 11.33% 12.90% 14.14% 11.76% 11.22% 12.51% 13.23% 13.72% 12.29% 13.72% 14.44% 11.44% 10.55% 12.21% 12.94% 13.63% 11.76% 13.63% 14.36% 12.30% 11.54% 13.11% 13.82% 12.95% 11.40% 12.95% 13.66% 12.10% 11.49% 12.92% 13.64% 12.75% 11.33% 12.75% 13.46% $ 85,238 $ 54,785 $ 53,286 $ 46,775 $ 40,074 Loans 90 days or more past due and still accruing (9) 614 7,547 1,529 407 305 Accruing restructured loans     Total nonperforming loans Other real estate owned     Total nonperforming assets 37,354 35,709 50,410 67,250 48,874 123,206 98,041 105,225 114,432 89,253 20,121 24,091 7,754 10,787 21,990 $ 143,327 $ 122,132 $ 112,979 $ 125,219 $ 111,243 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 credit losses to loans receivable Allowance for credit losses to nonaccrual loans Allowance for credit losses to nonperforming loans Allowance for credit losses to nonperforming assets Net charge-offs (recoveries) to average gross loans 0.63% 0.91% 0.84% 1.06% 1.52% 242.55% 167.80% 144.24% 0.07% 0.45% 0.80% 0.78% 0.99% 0.77% 0.44% 0.87% 0.74% 0.93% 0.77% 0.42% 1.03% 0.83% 1.13% 0.76% 0.38% 0.85% 0.83% 1.05% 0.75% 171.84% 173.70% 180.74% 197.99% 96.03% 77.08% 0.04% 87.96% 81.92% 0.06% 73.88% 67.51% 0.11% 88.90% 71.32% 0.07% (1) Net income divided by average assets (2) Net income divided by 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 average interest earning assets (7) Interest expense divided by 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 $13.2 million, $14.1 million, $18.1 million and $19.6 million as of December 31, 2019, 2018, 2017 and 2016, respectively 2020 ANNUAL REPORT / 10 2020 ANNUAL REPORT / 11 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 opera- tions, retail and small to middle-market business operations. Kevin S. Kim Chairman, President & Chief Executive Officer Hope Bancorp, Inc. Chairman & Chief Executive Officer Bank of Hope Scott Yoon-Suk Whang Lead Independent Director Founder and Former Chief Executive Officer Orange Circle Studios Steven S. Koh Honorary Chairman Chairman Pacific Steel Corporation Board of Directors Donald D. Byun Former President Jay Dee, Inc. Jinho Doo Former Chief Executive Officer Key Capital Management, LLC Daisy Y. Ha Attorney Joon Kyung Kim Former National Partner-in-Charge, Korea Practice KPMG LLP David P. Malone 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 Chung Hyun Lee* Former President NuArt International, Inc. Jin Chul Jhung* Chairman & President Royal Imex, Inc. * Term expires May 20, 2021 due to director’s decision to retire and not stand for re-election at the 2021 Annual Meeting of Stockholders. 2020 ANNUAL REPORT / 12 2020 ANNUAL REPORT / 13 Sincere Thanks The Company thanks retiring directors Mr. Chung Hyun Lee and Mr. Jin Chul Jhung for their tremendous contributions to Bank of Hope over the years. Location Information Southern California Branches Koreatown 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 Broadway 1205 S Broadway Los Angeles, CA 90015 T (213) 746-2222 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 Huntington Park Valley 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 Fullerton/Cerritos 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 Rowland Heights-Colima 10911 Colima Rd Walnut, CA 91789 T (909) 979-8020 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 Broadway Office 1205 S Broadway Los Angeles, CA 90015 T (213) 763-1122 Cerritos Office 17500 Carmenita Rd Cerritos, CA 90703 T (562) 926‐9091 Gardena Office 1655 W Redondo Beach Blvd, Suite 101 Gardena, CA 90247 T (310) 327-2222 OC Region Loan Center 6131 Orangethorpe Ave, Suite 305 Buena Park, CA 90621 T (562) 345‐3102 Olympic-Hoover Office 2222 W Olympic Blvd, 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 Olympic‐Western Office 3267 W Olympic Blvd Los Angeles, CA 90006 T (213) 401‐2302 Wilshire-Harvard Office 3600 Wilshire Blvd, Suite 100-A Los Angeles, CA 90010 T (213) 427-1000 T (213) 427‐6540 Premier Banking Group 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 Gardena/Torrance LPO 1655 W Redondo Beach Blvd, 3rd Floor Gardena, CA 90247 T (310) 352‐3000 Newport Beach LPO 24 Corporate Plaza, Suite 180 Newport Beach, CA 92660 T (949) 999-7900 Corporate Banking Group 8117 Preston Rd, Suite 510 Dallas, TX 75225 T (469) 619-1848 Credit Card Center 3200 Wilshire Blvd, 7th Floor Los Angeles, CA 90010 Commercial Leasing 3200 Wilshire Blvd, 4th Floor Los Angeles, CA 90010 Investment Services Olympic-Western Office 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 NCA Region Loan Center 47102 Mission Falls Ct, Suite 100 Fremont, CA 94539 T (510) 550-8000 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 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 (425) 921-1261 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 Houston 10000 Harwin Dr Houston, TX 77036 T (713) 774-0411 Houston-Spring 13890 Blalock Rd Houston, TX 77055 T (281) 407-3355 Commercial Loan Centers South Central Region Loan Center 2237 Royal Ln Dallas, TX 75229 T (972) 919-9999 Corporate Banking Group 8117 Reston Rd Dallas, TX 75225 T (469) 619-1848 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 Niles 8504 W Golf Rd Niles, IL 60714  T (847) 965-7373 Skokie 5526 Touhy Ave Skokie, IL 60077 T (773) 736-1300 Commercial Loan Center MW Region Loan Center 8504 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 Eastern Region Headquarters 16 W 32nd St New York, NY 10001 T (212) 279-2790 Bayside Office 222‐15 Northern Blvd, 4th Floor Bayside, NY 11361 SBA Loan Production Offices Atlanta LPO 3575 Koger Blvd, #380 Duluth, GA 30096 T (678) 380-0774 Dallas LPO 2727 Lyndon B Johnson Fwy Suite 110 Dallas, TX 75234 T (469) 522-4955 Denver LPO 2851 S Parker Rd, Suite 1120 Aurora, CO 80014 T (720) 535-5060 Houston LPO 10000 Harwin Dr Houston, TX 77036 T (281) 407-3353 New York LPO 162-05 Crocheron Ave Flushing, NY 11358 T (718) 412-9055 Northern California LPO 3340 Walnut Ave, #112 Freemont, CA 94538 T (510) 550-8001 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 Premier Commercial Banking Division 16 W 32nd St New York, NY 10001 T (212) 279-2790 Eastern Region SBA Department 138‐02 Northern Blvd Flushing, NY 11354 T (718) 886‐6611 New Jersey Branches Englewood Cliffs 474 Sylvan Ave Englewood Cliffs, NJ 07632 T (201) 500-9943 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 2200 Fletcher Ave, 3rd Floor Fort Lee, NJ 07024 Virginia Branches Annandale 7410 Little River Tpke Annandale, VA 22003 T (703) 354‐4310 Centreville 13890 Braddock Rd, Suite 102 Centreville, VA 20121 T (571) 321‐6272 Alabama Branches Montgomery 1605 Eastern Blvd Montgomery, AL 36117 T (334) 277-4118 2020 ANNUAL REPORT / 14 2020 ANNUAL REPORT / 15 Corporate Information Hope Bancorp, Inc. and Bank of Hope Board of Directors Executive Officers Executive Officers Kevin S. Kim Chairman, President & Chief Executive Officer Hope Bancorp, Inc. Chairman & Chief Executive Officer Bank of Hope Scott Yoon-Suk Whang Lead Independent Director Founder and Former Chief Executive Officer Orange Circle Studios Steven S. Koh Honorary Chairman Chairman Pacific Steel Corporation Donald D. Byun Former President Jay Dee, Inc. Jinho Doo Former Chief Executive Officer Key Capital Management, LLC Daisy Y. Ha Attorney Jin Chul Jhung * Chairman & President Royal Imex, Inc. Joon Kyung Kim Former National Partner-in-Charge Korea Practice KPMG LLP Chung Hyun Lee * Former President NuArt International, Inc. David P. Malone 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 * Term expires May 20, 2021 due to director’s decision to retire and not stand for re-election at the 2021 Annual Meeting of Stockholders. 2020 ANNUAL REPORT / 16 Kevin S. Kim Chairman, President & Chief Executive Officer Hope Bancorp, Inc. Chairman & Chief Executive Officer, Bank of Hope Alex Ko Senior Executive Vice President, Chief Financial Officer Hope Bancorp, Inc. and Bank of Hope Kyu S. Kim Senior Executive Vice President, Eastern Regional President Bank of Hope Craig L. Campbell Executive Vice President, Chief Corporate Banking Officer Bank of Hope Angelee J. Harris Executive Vice President, General Counsel & Corporate Secretary Hope Bancorp, Inc. and Bank of Hope David W. Kim Executive Vice President, Midwest Regional President Bank of Hope Richard D. Marshall Executive Vice President, Credit Administration Bank of Hope Thomas P. Stenger Executive Vice President, Chief Risk Officer Hope Bancorp, Inc. and Bank of Hope David P. Malone President & Chief Operating Officer Bank of Hope Jason K. Kim Senior Executive Vice President, Western Regional President Bank of Hope Peter Koh Executive Vice President, Chief Credit Officer Bank of Hope Andy Chan Executive Vice President, Chief Internal Audit Executive Hope Bancorp, Inc. and Bank of Hope Daniel H. Kim Executive Vice President, Chief Strategy & Administrative Officer Hope Bancorp, Inc. and Bank of Hope Young K. Lee Executive Vice President, Chief Human Resource Officer Bank of Hope David L. Song Executive Vice President, Credit Administration Bank of Hope Hung Van Executive Vice President, Chief Information Officer Bank of Hope Independent Auditors Investor Relations Crowe LLP Los Angeles, California SEC Counsel Sheppard, Mullin, Richter & Hampton 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. Angie Yang Senior Vice President, Director of Investor Relations & Corporate Communications T (213) 251-2219 angie.yang@bankofhope.com Offer of 10-K Report Stockholders may obtain without charge copies of Hope Bancorp’s 2020 Annual Report to the Securities and Exchange Commission on Form 10-K by sending a request to investor@bankofhope.com. Annual Meeting of Stockholders The Annual Meeting of Stockholders will be held on Thursday, May 20, 2021 at 10:30 a.m. Pacific Time. In light of public health concerns related to the COVID-19 coronavirus, the Annual Meeting will be held in a virtual meeting format only. Stockholders of the Company may attend the Annual Meeting online by visiting www.meetingcenter.io/287772759. The password for the meeting is HOPE2021. Corporate Headquarters 3200 Wilshire Blvd, 14th Floor Los Angeles, CA 90010 T (213) 639-1700 HOPE 2020 Form 10-K Hope Bancorp’s 2020 Form 10-K is provided in electronic form in the attached USB drive. To request printed copies, please send an email request to investor@bankofhope.com The Hope Bancorp 2020 Annual Report has not been reviewed, or confirmed for accuracy or relevance, by the Federal Deposit Insurance Corporation. 3200 Wilshire Blvd, 14th Floor Los Angeles, CA 90010 T (213) 639-1700 

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