Hope Bancorp (HOPE) Q2 2025 earnings summary

Executive summary

• Completed the acquisition of Territorial Bancorp, expanding into Hawaii, adding $1.67B in deposits, $1.07B–$1.93B in loans/assets, and 29 branches, diversifying the loan portfolio.

• Reported a net loss of $27.9M for Q2 2025 due to $38.9M–$52.4M in notable items including merger, securities repositioning, and a $4.9M California tax law change; excluding notable items, net income was $24.5M, up 7% sequentially.

• Strong capital and liquidity post-acquisition, with all regulatory ratios well above required levels.

• Strategic repositioning of legacy securities expected to add $12M annually to interest income.

Financial highlights

• Net interest income rose 17% quarter over quarter to $117.5M–$118M, with net interest margin up 15 bps to 2.69%.

• Noninterest income, excluding notable items, up 44% year over year to $15.9M; GAAP noninterest income was $(23.0)M due to $38.9M–$39M in securities losses.

• Noninterest expense, excluding notable items, was $92M–$92.2M, up from $81M–$81.3M sequentially; total noninterest expense was $109.5M, including $17.3M in merger costs.

• Efficiency ratio, excluding notable items, improved to 69.1%.

• Total assets reached $18.55B at June 30, 2025, up 8.8%–9% from prior periods; total deposits grew 10% to $15.9B–$15.94B.

Outlook and guidance

• Expect high single-digit percentage growth in loans and net interest income for 2025; noninterest income growth guidance raised to upper-20s percent.

• Noninterest expense growth guidance unchanged at low double-digit percentage year over year.

• Effective tax rate anticipated at approximately 14% for Q3 and Q4 2025, 20–21% for 2026; ongoing tax rate lowered by ~1% due to California law change.

• Management expects improved earnings and profitability from strategic actions and integration of Territorial.

• Liquidity sources sufficient for foreseeable needs, with $8.44B in available liquidity at quarter-end.