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1. Company Snapshot

1.a. Company Description

Hanmi Financial Corporation operates as the holding company for Hanmi Bank that provides business banking products and services in the United States.The company offers various deposit products, including noninterest-bearing checking accounts, interest-bearing checking and savings accounts, negotiable order of withdrawal accounts, money market accounts, and certificates of deposit.It also provides real estate loans, such as commercial property, construction, and residential property loans; and commercial and industrial loans, such as commercial term loans and commercial lines of credit, as well as international finance, and trade services and products comprising letters of credit, and import and export financing.


In addition, the company offers consumer loans, secured and unsecured loans, home equity loans, residential mortgages, and credit cards; SBA and trade finance lending to small and middle market businesses; and small business administration loans for business purposes, which comprise owner-occupied commercial real estate, business acquisitions, start-ups, franchise financing, working capital, improvements and renovations, inventory and equipment, and debt-refinancing, as well as equipment lease financing.As of February 28, 2022, it operated a network of 35 full-service branches and 8 loan production offices in California, Texas, Illinois, Virginia, New Jersey, New York, Colorado, Washington, and Georgia.The company was founded in 1982 and is headquartered in Los Angeles, California.

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1.b. Last Insights on HAFC

Here is a 90-word analysis of the negative drivers behind Hanmi Financial Corporation's recent stock performance: Hanmi Financial's recent earnings release revealed a year-over-year decline in earnings per share, from $0.61 to $0.58, despite beating estimates. The company's Q4 2024 results were impacted by lower net interest income and higher operating expenses. Additionally, the provision for loan losses increased, indicating potential credit quality issues. These factors may have contributed to investor concerns, outweighing the positive impact of the company's dividend hike announcement.

1.c. Company Highlights

2. Hanmi Financial's Q3 2025 Earnings: Strong Growth and Optimistic Outlook

Hanmi Financial Corporation reported a net income of $22.1 million or $0.73 per diluted share for the third quarter of 2025, significantly higher than $15.1 million or $0.50 per diluted share in the second quarter. The increase in net income was primarily driven by higher net interest income and a decrease in credit loss expense. Net interest income grew 6.9% to $61.1 million, reflecting the company's ability to expand its loan portfolio and improve margins. Pre-provision net revenues increased 16.4% to $47 million, demonstrating the strength of Hanmi's core business. The actual EPS of $0.73 beat estimates of $0.66, indicating a positive surprise.

Publication Date: Oct -28

📋 Highlights
  • Net Income Growth:: Q3 net income rose to $22.1M ($0.73/share) vs. $15.1M ($0.50/share) in Q2, driven by higher net interest income and lower credit loss expenses.
  • Loan Production Surge:: Total loan production hit $571M in Q3, up 73% from Q2 ($241M), with a weighted average rate of 6.91%.
  • Pre-Provision Net Revenue (PPNR):: Increased 16.4% to $47M, reflecting a 6.9% growth in net interest income to $61.1M and controlled expenses.
  • Deposit Funding Strategy:: Loan-to-deposit ratio reached 97%, requiring deposit growth or borrowed funds (higher cost) to sustain net interest margin expansion amid expected Fed rate cuts.
  • Asset Quality Management:: Net recovery in credit losses and proactive loan portfolio "slicing and dicing" to remove problematic loans, maintaining strong loan-to-value and debt service coverage ratios.

Loan Growth and Credit Quality

Hanmi's loan production was $571 million in Q3, up 73% from the prior quarter, with a weighted average interest rate of 6.91%. The company's commercial loans were a key contributor to the total loan production. Despite some credit noise in the quarter, Hanmi's credit quality remained satisfactory, with the company actively managing its loan portfolio and maintaining a comprehensive approach to monitoring credit metrics. As Bonita I. Lee mentioned, "we continue to monitor our loan-to-value ratios, debt service coverage ratios, and other credit metrics on an ongoing basis."

Funding and Net Interest Margin

Hanmi's loan-to-deposit ratio increased to 97% due to strong loan growth, highlighting the need for deposit growth to maintain net interest margin expansion. However, with the expected Fed rate cuts, deposit costs are anticipated to decrease, which should help the company's net interest margin. The company may need to use borrowed funds, which have a higher marginal cost, but this is not expected to negate growth.

Valuation and Outlook

Hanmi's current Price-to-Tangible Book Value (P/TBV) is around 1.04, indicating a relatively reasonable valuation. The Dividend Yield is 3.9%, which is attractive for income investors. With analysts estimating revenue growth of 11.0% next year, the stock may have upside potential. Hanmi's management is optimistic about the company's long-term growth opportunities, driven by its client-focused strategy and relationship-driven banking model. The company's commitment to prudent expense control and strong asset quality should continue to support its growth prospects.

3. NewsRoom

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Meet 33 Ideal "Safer" November Small/MidCap Value DiviBuys Of The S&P600

Nov -26

Source: seekingalpha.com

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First National of Nebraska (OTCMKTS:FINN) & Hanmi Financial (NASDAQ:HAFC) Critical Survey

Nov -18

Source: defenseworld.net

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Analysts Set Hanmi Financial Corporation (NASDAQ:HAFC) PT at $28.50

Nov -16

Source: defenseworld.net

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Hanmi Financial (HAFC) Upgraded to Strong Buy: What Does It Mean for the Stock?

Nov -14

Source: zacks.com

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Best Income Stocks to Buy for Nov. 14

Nov -14

Source: zacks.com

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Best Income Stocks to Buy for Nov. 11

Nov -11

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Hanmi Financial (NASDAQ:HAFC) vs. Bay Commercial Bank (NASDAQ:BCML) Head to Head Contrast

Nov -03

Source: defenseworld.net

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Financial Contrast: Hanmi Financial (NASDAQ:HAFC) versus Sierra Bancorp (NASDAQ:BSRR)

Nov -02

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.00%)

6. Segments

Traditional Banking Activities

Expected Growth: 3.0%

Hanmi Financial Corporation's 3.0% growth in traditional banking activities is driven by increasing loan demand, expansion of commercial and industrial lending, and growth in deposit accounts. Additionally, strategic acquisitions, improved operating efficiency, and a favorable interest rate environment contribute to the growth.

7. Detailed Products

Commercial Banking

Hanmi Financial Corporation offers a range of commercial banking services, including cash management, treasury management, and commercial lending to meet the financial needs of businesses.

Consumer Banking

Hanmi Financial Corporation provides consumer banking services, including checking and savings accounts, credit cards, personal loans, and mortgages to individuals.

Wealth Management

Hanmi Financial Corporation offers wealth management services, including investment management, trust services, and financial planning to help individuals and families achieve their financial goals.

Home Loans

Hanmi Financial Corporation provides a range of home loan options, including fixed-rate and adjustable-rate mortgages, to help individuals and families achieve homeownership.

Small Business Administration (SBA) Loans

Hanmi Financial Corporation offers SBA loans to small businesses, providing access to capital for business expansion, equipment purchases, and working capital.

Treasury Management

Hanmi Financial Corporation provides treasury management services, including cash management, wire transfers, and account reconciliation to help businesses manage their cash flow.

8. Hanmi Financial Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Hanmi Financial Corporation operates in a highly competitive industry, and customers have various alternatives to choose from. However, the company's strong brand reputation and customer loyalty mitigate the threat of substitutes.

Bargaining Power Of Customers

Hanmi Financial Corporation's customers have significant bargaining power due to the availability of alternative financial institutions and online banking services. This forces the company to maintain competitive pricing and high-quality services.

Bargaining Power Of Suppliers

Hanmi Financial Corporation has a diverse supplier base, and no single supplier has significant bargaining power. The company's strong financial position also gives it negotiating power over its suppliers.

Threat Of New Entrants

The banking industry has high barriers to entry, including regulatory hurdles and significant capital requirements. This limits the threat of new entrants and allows Hanmi Financial Corporation to maintain its market position.

Intensity Of Rivalry

The banking industry is highly competitive, with many established players competing for market share. Hanmi Financial Corporation must continually innovate and improve its services to maintain its competitive edge.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 39.65%
Debt Cost 3.95%
Equity Weight 60.35%
Equity Cost 8.59%
WACC 6.75%
Leverage 65.70%

11. Quality Control: Hanmi Financial Corporation passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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PCB Bank

A-Score: 7.3/10

Value: 7.4

Growth: 6.8

Quality: 6.0

Yield: 8.0

Momentum: 7.5

Volatility: 8.0

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First Financial

A-Score: 7.0/10

Value: 7.3

Growth: 5.4

Quality: 6.0

Yield: 7.0

Momentum: 8.5

Volatility: 8.0

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CB Financial Services

A-Score: 6.9/10

Value: 6.3

Growth: 4.8

Quality: 6.9

Yield: 7.0

Momentum: 8.0

Volatility: 8.7

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First Financial

A-Score: 6.6/10

Value: 7.2

Growth: 6.1

Quality: 5.8

Yield: 8.0

Momentum: 5.0

Volatility: 7.7

1-Year Total Return ->

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Hanmi Financial

A-Score: 6.5/10

Value: 5.9

Growth: 5.2

Quality: 5.6

Yield: 8.0

Momentum: 8.0

Volatility: 6.3

1-Year Total Return ->

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Bankwell Financial Group

A-Score: 6.5/10

Value: 6.8

Growth: 6.1

Quality: 5.4

Yield: 4.0

Momentum: 9.0

Volatility: 7.7

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

28.11$

Current Price

28.11$

Potential

-0.00%

Expected Cash-Flows