<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMSSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
/X/ Quarterly report pursuant to section 13 or 15 (d) of the Securities
Exchange Act of 1934 For the quarterly period ended September 30, 2000 or
/ / Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from __________ to ___________
HANMI FINANCIAL CORPORATION
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 95-4788120
--------------------------------------------------------------------------------
(State or other jurisdiction (IRS Employer Identification Number)
of incorporation or organization)
3660 WILSHIRE BOULEVARD, SUITE PH-A, LOS ANGELES, CALIFORNIA 90010
--------------------------------------------------------------------------------
(Address of Principal executive offices) (Zip Code)
(213) 382-2200
--------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
NOT APPLICABLE
--------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes / / No /X/
As of September 30, 2000, there were approximately 7,434,457 outstanding shares
of the issuer's Common Stock, with par value at $.001.
<PAGE>
FORM 10-Q
INDEX
HANMI FINANCIAL CORPORATION
<TABLE>
<CAPTION>
PAGE
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<S> <C>
PART I FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
Consolidated Statements of Financial Condition -
September 30, 2000 and December 31, 1999 2
Consolidated Statements of Operations -
Three and Nine Months Ended September 30, 2000 and 1999 3
Consolidated Statements of Changes in Shareholders' Equity
Nine Months Ended September 30, 2000 and 1999 4
Consolidated Statements of Cash Flows -
Nine Months Ended September 30, 2000 and 1999 5
Notes to Consolidated Financial Statements 6
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 8
Item 3. QUANTITIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK 19
PART II OTHER INFORMATION
Other Information 22
Signature 22
</TABLE>
<PAGE>
Item 1. FINANCIAL STATEMENTS
HANMI FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
(AMOUNTS IN THOUSANDS) SEPTEMBER 30, DECEMBER 31,
2000 1999
(UNAUDITED)
----------- -----------
<S> <C> <C>
ASSETS
Cash and due from banks $ 63,528 $ 53,476
Federal funds sold and
Securities purchased under agreement to resell 48,600 10,000
----------- -----------
Cash and cash equivalents 112,128 63,476
Interest-bearing deposits in other financial institutions 100
Federal Reserve Bank stock 1,954 1,686
Investment securities held to maturity, at amortized cost 50,716 66,224
(fair value: September 30,2000-$50,373(unaudited); December 31, 1999-$66,096)
Investment securities available for sale, at fair value 153,595 105,014
Interest only strip - at fair value 326 352
(amortized cost: September 30, 2000-$306(unaudited); December 31, 1999-$330)
Loans receivable, net of allowance for loan losses of $11,577
(unaudited) and $10,624 at September 30, 2000 and December 31, 1999, repectively) 577,555 456,149
Loans held for sale, at lower of the cost or market 18,155 18,501
Customers liability on acceptances 2,254 1,829
Premises and equipment, net 9,482 8,939
Accrued interest receivable 6,651 4,961
Other real estate owned, net 291
Deferred income taxes, net 5,131 5,608
Servicing asset 1,819 1,500
Goodwill and intangible assets 2,494 2,680
Other assets 3,788 3,240
----------- -----------
TOTAL $ 946,339 $ 740,259
=========== ===========
LIABILITIES AND SHAREHOLDERS EQUITY
LIABILITIES:
Deposits :
Noninterest-bearing $ 222,814 $ 193,165
Interest-bearing:
Savings 64,629 54,416
Time deposits of $100,000 or more 191,366 123,488
Other time deposits 265,292 190,699
Money market checking 105,290 93,962
----------- -----------
Total deposits 849,391 655,730
Accrued interest payable 5,220 3,157
Acceptance outstanding 2,254 1,829
Securities sold under repurchase agreement -- 5,892
Treasury, tax, and loan remittances 3,888 4,500
Other liabilities 5,279 1,321
----------- -----------
Total liabilities 866,032 672,429
SHAREHOLDERS EQUITY:
Common stock, $.001 par value; authorized, 10,000 shares;
issued and outstanding, 7,434 shares,and 6,680 shares at
September 30, 2000 and December 31,1999, respectively (Note 3) 7 6
Additional paid-in capital 65,415
Accumulated other comprehensive income - unrealized loss on
securities available for sale, net of taxes of ($1,525) and ($2,002) at --
September 30, 2000 and December 31,1999, respectively (2,135) (3,079)
Unrealized gain (loss) on interest-only strips, net of taxes of $8
and $9 in September 30, 2000 and December 31, 1999, respectively 11 13
Retained earnings 17,009 14,684
----------- -----------
Total shareholders equity 80,307 67,830
----------- -----------
TOTAL $ 946,339 $ 740,259
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
HANMI FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
<TABLE>
<CAPTION>
FOR THREE MONTHS ENDED, FOR NINE MONTHS ENDED,
----------------------------- -----------------------------
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
(AMOUNTS IN THOUSANDS, EXCEPT) 2000 1999 2000 1999
------------- ------------- ------------- -------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Interest Income:
Interest and fees on loan 14,800 10,249 41,174 28,117
Interest on investment se 2,961 2,764 7,940 8,867
Interest on federal funds 1,028 435 2,220 1,095
------------- ------------- ------------- -------------
Total interest income 18,789 13,448 51,334 38,079
Interest Expense 8,419 4,726 21,192 13,582
------------- ------------- ------------- -------------
Net Interest Income before 10,370 8,722 30,142 24,497
Provision for Loan Losses 600 - 1,600 400
------------- ------------- ------------- -------------
Net Interest Income after 9,770 8,722 28,542 24,097
Noninterest income:
Service charges on depo 2,234 2,037 6,578 6,144
Gain on sale of loans 235 225 1,169 826
Gain on sale of securities - 24 51 178
Gain on sale of OREO 42 32 42 32
Other service charges an 1,116 838 2,615 2,160
Other income 85 56 226 192
------------- ------------- ------------- -------------
Total noninterest In 3,712 3,212 10,681 9,532
Noninterest Expense:
Salaries and employee b 3,607 3,153 10,114 8,861
Occupancy and equipment 862 637 2,366 1,991
Data processing 507 487 1,556 1,487
Deposit insurance premi 51 38 170 98
Professional fees 213 224 666 721
Advertising 100 122 278 257
Office supplies 157 128 567 430
Communications 157 131 453 396
Other operating 1,280 1,647 3,740 3,536
------------- ------------- ------------- -------------
Total noninterest Ex 6,934 6,567 19,910 17,777
------------- ------------- ------------- -------------
Income before Income Tax 6,548 5,367 19,313 15,852
Income Tax Provision 2,701 2,165 8,053 6,538
------------- ------------- ------------- -------------
Net Income 3,847 3,202 $11,260 $ 9,314
============= ============= ============= =============
Earning Per Share (Note 3)
Basic $ 0.52 $ 0.48 $ 1.52 $ 1.40
Diluted $ 0.52 $ 0.48 $ 1.51 $ 1.39
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
HANMI FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
-----------------------------
SEPTEMBER 30, SEPTEMBER 30,
(AMOUNTS IN THOUSANDS) 2000 1999
------------- -------------
<S> <C> <C>
Common Stock
Balance, beginning of period $ 6 $ 5
Stock Dividends (Note 3) 1 1
------------- -------------
Balance, end of period $ 7 $ 6
Additional paid-in capital
Balance, beginning of period $ 56,206 $ 47,034
Stock Options Exercised 271
Common Stock Issued-Employee Stock Bonus; 20,271 shares @ $ 13.75 278
Stock Dividends (Note 3) 8,931 8,901
------------- -------------
Balance, end of period $ 65,415 $ 56,206
Retained Earnings
Balance, beginning of period $ 14,684 $ 11,582
Net Income 11,260 9,314
Stock Dividends (8,935) (8,904)
------------- -------------
Balance, end of period $ 17,009 $ 11,992
Accumulated Other Comprehensive Income:
Balance, beginning of period $ (3,066) $ 352
Change in unrealized gain (loss) on securities available for sale
and interest-only strips, net of tax 942 (2,561)
------------- -------------
Balance, end of period $ (2,124) $ (2,209)
Total Shareholers' Equity $ 80,307 $ 65,995
============= ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
HANMI FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
---------------------------------
SEPTEMBER 30, SEPTEMBER 30
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA) 2000 1999
------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 11,260 $ 9,314
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 563 513
Provision for loan losses 1,600 400
Proceeds from OREO 671
Stock compensation expense 278
Gain on sale of securities available for sale (51) (178)
Gain on sale of loans (1,169) (826)
Origination of loans held for sale (19,998) (24,496)
Proceeds from sale of loans held for sale 21,513 15,025
Change in:
Accrued interest receivable (1,690) 78
Other assets (949) 862
Accrued interest payable 2,063 (323)
Other liabilities 3,958 561
------------- -------------
Net cash provided by operating activities 17,378 2,226
------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from interest-bearing deposits 100 2,081
Proceeds from matured or called investment securities avilable for sale 13,419 19,908
Proceeds from matured or called investment securities held to maturity 35,586 55,949
Net increase in loans receivable (123,297) (107,047)
Purchase of securities available for sale (60,528) (11,677)
Purchase of securities held to maturity (20,078) (17,722)
Decrease in I/O strip 24 40
Purchases of premises and equipment (1,106) (362)
------------- -------------
Net cash used in investing activities (155,880) (58,830)
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in deposits 193,661 61,489
Stock dividend paid in cash for fractional shares (3) (2)
Payment made on other borrowing (5,892) -
Payment made on treasury, tax and loan remittance (612) 4,280
------------- -------------
Net cash provided by financing activities 187,154 65,767
------------- -------------
NET INCREASE IN CASH AND CASH EQUIVALENTS 48,652 9,163
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 63,476 70,729
------------- -------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 112,128 $ 79,892
============= =============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Interest paid $ 17,099 $ 24,709
Income taxes paid 4,364 5,950
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING, OPERATING
AND FINANCING ACTIVITIES -
Transfer of retained earning to common stock for stock dividend $ 1 $ 1
Transfer of retained earning to additional paid-in capital for stock dividend 8,931 8,901
Transfer of loan to OREO 291 -
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Balance Sheets at September 30, 2000 and December 31, 1999.
Income Statements for the three and nine months ended September 30, 2000
and 1999.
Statements of Stockholders' Equity for the nine months ended September 30,
2000 and 1999.
Statements of Cash Flow for the nine months ended September 30, 2000 and 1999.
NOTE 1. HANMI FINANCIAL CORPORATION
As of March 14, 2000, Hanmi Financial Corporation ("Hanmi") was
incorporated as a bank holding company, which owned Hanmi Bank (the "Bank").
The new corporate structure will permit Hanmi and the Bank greater
flexibility in terms of operations, expansion and diversification. Shortly
after the incorporation, Hanmi registered its common stock with the
Securities and Exchange Commission (the "SEC") pursuant to the terms of a
Plan and Agreement of Merger and Reorganization. The registration statement
was declared effective on May 4, 2000. At the same time, Hanmi registered its
common stock with the SEC pursuant to section 12(g) and the Security Exchange
Act of 1934, as amended. The reorganization was consummated with the approval
obtained at the shareholder's meeting on May 31, 2000. In the reorganization,
the Bank continued its operations as presently conducted under its management.
NOTE 2. BASIS OF PRESENTATION
In the opinion of management, the consolidated financial statements of
Hanmi Financial Corporation and its subsidiary (the "Company") reflect all the
material adjustments necessary for a fair presentation of the results for the
interim period ended September 30, 2000 but are not necessarily indicative of
the results which will be reported for the entire year. In the opinion of
management, the aforementioned consolidated financial statements are in
conformity with generally accepted accounting principles.
Certain reclassifications were made to the prior period's presentation
to conform to the current period presentation.
NOTE 3. CHANGE IN EQUITY
On February 16, 2000, the Bank declared an 11% stock dividend payable
on April 3, 2000 to shareholders of record at the close of business on March 1,
2000. The shares and per share data have been retroactively restated to reflect
the 11% year 2000 stock dividend. On May 3, 1999, the Bank paid an 11% stock
dividend to shareholders of record on April 26, 1999. The shares and per share
data for the 1999 dividend have been retroactively restated to reflect the 11 %
dividend.
On August 16, 2000 the Company granted stock bonus to employee and
on September 15, 2000. 20,271 shares were issued at $13.75. The number of
outstanding shares and per share data as of September 30, 2000 reflect this
transaction.
6
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NOTE 4. RECENT ACCOUNTING PRONOUNCEMENT
On June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activities". In June 2000, the FASB issued
SFAS No. 138, which amends certain provisions of SFAS 133 to clarify four areas
causing difficulties in implementation. The amendment included expanding the
normal purchase and sale exemption for supply contracts, permitting the
offsetting of certain intercompany foreign currency derivatives and thus
reducing the number of third party derivatives, permitting hedge accounting for
foreign-currency denominated assets and liabilities, and redefining interest
rate risk to reduce sources of ineffectiveness. The Company will adopt SFAS 133
and the corresponding amendments under SFAS 138 on January 1, 2001. In
management's opinion, implementation of SFAS 133, as amended by SFAS 138, is not
expected to have a material impact to the overall financial position or results
of operations of the Company.
On December 3, 1999, the Securities and Exchange Commission issued
Staff Accounting Bulletin ("SAB" or the "Bulletin") 101, Revenue Recognition in
Financial Statements. The Bulletin provided views in applying generally accepted
accounting principles to selected revenue recognition issues. The Bulletin
further emphasized that revenue should not be recognized until it is realized or
realizable and earned. SAB 101, as amended by SAB 101A and 101B, is to be
implemented by the Company no later than the fourth fiscal quarter of fiscal
years beginning after December 15, 1999. In management's opinion, implementation
of SAB 101 will not have a material impact to the overall financial position or
results of operations of the Company.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULT OF OPERATION
The following is management's discussion and analysis of the major
factors that influenced the Company's results of operations and financial
condition for the three and nine months ended September 30, 2000.
The following table sets forth certain selected financial data concerning the
Company for the periods indicated (dollars in thousands):
<TABLE>
<CAPTION>
SEPTEMBER 30, SEPTEMBER 30,
2000 1999
---------------------- ---------------------
<S> <C> <C>
AVERAGE BALANCES:
Average net loans $536,007 $374,040
Average investment securities 221,320 222,416
Average assets 831,868 714,751
Average deposits 729,997 603,646
Average equity 76,506 63,235
PERFORMANCE RATIOS:
Return on average asset (1) 1.80% 1.74%
Return on average common equity (1) 19.62% 19.64%
Efficiency ratio (2) 48.77% 52.24%
Net interest margin (3) 5.31% 5.48%
CAPITAL RATIOS (4)
Leverage capital ratio (5) 8.20% 9.04%
Tier 1 risk-based capital ratio 11.25% 12.50%
Total risk-based capital ratio 12.57% 13.75%
ASSET QUALITY RATIOS
Allowance for loan losses to total gross loans 1.90% 2.27%
Allowance for loan losses to non-performing
loans 151.04% 350.40%
Total non-performing assets and other real
estate owned to total assets 0.81% 0.42%
</TABLE>
----------------------------------------
(1) Calculations are based upon annualized net income.
(2) Efficiency ratio is defined as operating expenses divided by the sum of net
interest income and other non-interest income.
(3) Net interest margin is calculated by dividing annualized net interest income
by total average interest-earning assets.
(4) The required ratios for a "well-capitalized" institution are 5% leverage
capital, 6% tier 1 risk-based capital and 10% total risk-based capital.
(5) Calculations are based on average quarterly asset balances of Hanmi Bank.
8
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FORWARD-LOOKING INFORMATION
Certain matters discussed under this caption may constitute
forward-looking statements under Section 27A of the Securities Act and Section
21E of the Securities Exchange Act of 1934. There can be no assurance that the
results described or implied in such forward-looking statements will, in fact,
be achieved and actual results, performance, and achievements could differ
materially because the business of the Company involves inherent risks and
uncertainties. Risks and uncertainties include possible future deteriorating
economic conditions in the Company's areas of operation; interest rate risk
associated with volatile interest rates and related asset-liability matching
risk; liquidity risks; risk of significant non-earning assets, and net credit
losses that could occur, particularly in times of weak economic conditions or
times of rising interest rates; risks of available for sale securities declining
significantly in value as interest rates rise; and regulatory risks associated
with the variety of current and future regulations to which the Company is
subject. For additional information concerning these factors, see "Risk Factors"
contained in the Company's Registration Statement on Form S-4.
RESULTS OF OPERATION
For the third quarter of 2000, the Company reported net income of $3.8
million or $0.52 per diluted share compared to $3.2 million or $0.48 per diluted
share for the same quarter of 1999, representing an increase of $.6 million or
20.14%. The increase in 2000 third quarter net income was primarily attributable
to a $1.6 million increase in net interest income before provision for loan
losses.
The annualized return on average assets was 1.80% for the third
quarter of 2000 compared to a return on average assets of 1.74% for the same
quarter of 1999, an increase of 0.06%. The annualized return on average
equity was 19.62% for the third quarter of 2000, compared to a return on
average equity of 19.64% for the same quarter in 1999, a decrease of 0.02%.
For the nine months ended September 30, 2000, the Company reported
net income of $11.3 million or $1.52 per basic and $1.51 per diluted common
share, compared with $9.3 million or $1.40 per basic and $1.39 per diluted
common share for the same period of 1999. This represents an increase of $2.0
million or 20.9%.
NET INTEREST INCOME
The principal component of the Company's earnings is net interest
income, which is the difference between the interest and fees earned on loans
and investments and the interest paid on deposits and other borrowed funds. When
net interest income is expressed as a percentage of average interest-earning
assets, the result is the net interest margin. The net interest spread is the
yield on average interest-earning assets less the average cost of
interest-bearing deposits and borrowed funds.
For the third quarter of 2000, net interest income before provision for
loan losses increased to $10.4 million. Comparing with $8.7 million for the
corresponding quarter of 1999, this represented an increase of $1.7 million or
18.9%.
For the nine months ended September 30, 2000, net interest income
before provision for loan losses increased to $30.1 million, compared with $24.5
million a year ago. This represented
9
<PAGE>
an increase of $5.6 million or 23.0%. The increase in net interest income before
provision for loan losses was substantially attributable to an increase of
$160.8 million in average interest-earning assets, from $596.5 million to $757.3
million, which represented an increase of 27.0%.
The yield on average interest-earning assets increased to 9.04% for the
nine months ended September 30, 2000, from a yield of 8.51% for the nine months
ended September 30, 1999. This increase is primarily due to an increase in the
Bank's loan portfolio, which has a higher yield than investment securities, and
a result of three consecutive 25 basis point interest rate raise by the Feral
Reserve Board in the last quarter of 1999 and first two quarters of year 2000.
Approximately 70.8% of Company's interest earning assets were comprised of loans
at September 30, 2000, compare to 62.7% at September 30, 1999.
For the third quarter of 2000, net interest expenses increased to $8.4
million. Comparing with $4.7 million for the corresponding quarter of 1999, this
represented an increase of $3.7 million or 78.1%.
The Company's interest expense on deposits for the nine months ended
September 30, 2000 increased by approximately $7.6 million or 56.0% to $21.2
million from $13.6 million for the nine months ended September 30, 1999. This
increase reflected an increase in the average volume of interest-bearing
liabilities and interest rates paid to depositors. Average interest-bearing
liabilities were $521.5 million for the nine months ended September 30, 2000,
which represented an increase of $109.2 million or 26.5% from average
interest-bearing liabilities of $412.3 million for the nine months ended
September 30, 1999. The cost of average interest-bearing liabilities increased
to 5.42% for the nine months ended September 30, 2000, compared to a cost of
4.39% for the same period of 1999. Overall interest on deposits increased due to
an increase in market rates and also due to an increase in competition among our
peer banks.
The table below presents the average yield on each category of
interest-earning assets, average rate paid on each category of interest-bearing
liabilities, and the resulting interest rate spread and net yield on
interest-earning assets for periods indicated. All average balances are daily
average balances.
<TABLE>
<CAPTION>
SEPTEMBER 30, 2000 SEPTEMBER 30, 1999
----------------------------------- ----------------------------------
INTEREST AVERAGE INTEREST AVERAGE
AVERAGE INCOME/ YIELD/ AVERAGE INCOME/ YIELD/
BALANCE EXPENSE COST BALANCE EXPENSE COST
----------- ----------- ----------- ----------- ---------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
INTEREST EARNING ASSETS:
Net loans....................... $536,007 $41,174 10.24% $374,040 $28,117 10.02%
Municipal bonds................. 15,800 689 5.81% 12,303 540 5.85%
Obligation of other U.S.........
Government agencies............. 95,679 4,541 6.33% 103,350 4,758 6.14%
Other debt securities........... 64,426 2,710 5.61% 76,451 3,522 6.14%
Federal funds sold.............. 45,415 2,220 6.52% 29,115 1,095 5.01%
Interest earning deposit........ 0 0 0 1,197 47 5.24%
----------- ----------- ----------- ----------
TOTAL INTEREST EARNING ASSETS $757,327 $51,334 9.04% $596,456 $38,079 8.51%
=========== =========== =========== ==========
</TABLE>
10
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
INTEREST BEARING LIABILITIES:
Money market checking........... $98,000 $2,762 3.76% $92,007 2,054 2.98%
Savings......................... 52,886 1,590 4.01% 54,188 1,656 4.07%
Time certificates of deposits 149,082 6,547 5.86% 144,718 4,507 4.15%
$100,000 or more................
Other time certificates of 217,712 10,115 6.19% 118,988 5,283 5.92%
deposits......................
Other borrowing................. 3,794 178 6.26% 2,412 82 4.53%
TOTAL INTEREST BEARING ----------- -----------
LIABILITIES $521,474 $21,192 5.42% $412,313 $13,582 4.39%
=========== =========== =========== ===========
Net interest income............... $30,142 $24,497
Net interest spread............... 3.62% 4.12%
Net interest margin............... 5.31% 5.48%
</TABLE>
The following table shows changes in interest income and interest
expense and the amounts attributable to variations in interest rates and volumes
for the periods indicated. The variances attributable to simultaneous volume and
rate changes have been allocated to the change due to volume and the change due
to rate categories in proportion to the relationship of the absolute dollar
amount attributable solely to the change in volume and to the change in rate.
<TABLE>
<CAPTION>
SEPTEMBER 30, 2000 OVER SEPTEMBER 30, 1999
------------------------------------------------------------------
CHANGE DUE TO NET INCREASE
------------------------------------------ -----------------------
VOLUME RATE (DECREASE)
------------------- ---------------------- -----------------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
INTEREST INCOME:
Interest and fees on net loans............ $12,175 $882 $13,057
Municipal bonds........................... 153 (4) 149
Obligation of other U.S. Government (353) 136 (217)
agencies..............................
Other debt securities..................... (554) (258) (812)
Federal funds sold........................ 613 512 1,125
Interest earning deposit.................. (47) 0 (47)
------------------- ---------------------- -----------------------
TOTAL INTEREST INCOME: 11,987 1,268 13,255
INTEREST EXPENSE
Money market checking..................... 134 574 708
Savings................................... (40) (26) (66)
Time certificates of deposit 136 1,904 2,040
$100,000 or more......................
Other time certificates of deposits 4,383 449 4,832
Other borrowing........................... 47 49 96
------------------- ---------------------- -----------------------
TOTAL INTEREST EXPENSE: 4,660 2,950 7,610
CHANGE IN NET INTEREST INCOME $7,327 $(1,682) $5,645
=================== ====================== =======================
</TABLE>
11
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NON-INTEREST INCOME
Non-interest income includes revenues earned from sources other than
interest income. It is primarily comprised of service charges and fees on
deposit accounts, other service charges and fees, including fees received from
issuing the letter of credit for international trade finance, and gain on sale
of SBA loans and mortgage loans.
For the third quarter of 2000, non-interest income increased
approximately by $500,000 or 15.6% to $3.7 million over the same period in
1999. The increase was primarily attributable to increase in service charges
and fees on deposit account due to increase in volume. Service charges and
fees on deposit account increased by $197,000 or 9.7% during the quarter
ended September 30, 2000 compared to the same period in 1999. Premiums
received from the sale of SBA loans slightly increased over the same quarter
of 1999 and these increased premiums are expected to extend through the year
2000 as interest rates continue in an upward trend.
For the nine months ended September 30, 2000, non-interest income
totaled $10.7 million compare with $9.5 million for the same period a year ago.
The increase of $1.2 million was attributable to a combination of a $434,000
increase in service charges and fees on deposit accounts, $455,000 increase in
other service charges and fees, and $343,000 increase in gain on sale of SBA
loans. The fee income generated by trade financing transactions slightly
increased over the same period a year ago due to growing activity in
international trade as Asian countries recovered from the economic crisis.
The breakdown of non-interest income by category is reflected below:
<TABLE>
<CAPTION>
QUARTER ENDED QUARTER ENDED INCREASE (DECREASE)
------------------ ----------------- ------------- --------------
9/30/00 9/30/99 AMOUNT PERCENT (%)
------------------ ----------------- ------------- --------------
(Dollars in thousands)
NON-INTEREST INCOME
<S> <C> <C> <C> <C>
Service charges on deposits....... $2,234 $2,037 $197 9.67 %
Gain on sale of SBA loans......... 235 225 10 4.44 %
Gain on sale of Securities........ 0 24 (24)
Gain on sale of OREO.............. 42 32 10 31.25%
Other service charges and fees.... 1,116 838 278 33.17%
Other income...................... 85 56 29 51.79%
------------------ ----------------- ------------- --------------
TOTAL NON-INTEREST INCOME: $3,712 $3,212 $500 15.57%
================== ================= ============= ==============
</TABLE>
<TABLE>
<CAPTION>
FOR NINE MONTHS FOR NINE MONTHS INCREASE (DECREASE)
ENDED ENDED
------------------ ----------------- -------------- -------------
9/30/00 9/30//99 AMOUNT PERCENT (%)
(Dollars in thousands)
<S> <C> <C> <C> <C>
NON-INTEREST INCOME
Service charges on deposits....... $ 6,578 $ 6,144 $434 7.06 %
Gain on sale of SBA loans......... 1,169 826 343 41.53 %
Gain on sale of Securities........ 51 178 (127) (71.35)%
Gain on sale of OREO.............. 42 32 10 31.25%
Other service charges and fees.... 2,615 2,160 455 21.06 %
Other income...................... 226 192 34 17.71%
------------------ ----------------- -------------- -------------
TOTAL NON-INTEREST INCOME: $10,681 $9,532 $1,149 12.05%
================== ================= ============== =============
</TABLE>
12
<PAGE>
NON-INTEREST EXPENSES
Non-interest expenses for the third quarter of 2000 increased
approximately $367,000 or 5.6% to $6.9 million from $6.6 million for the same
period in 1999. The increase was attributable to a combination of internal
growth and change in organization structure. Salaries and employee benefits were
up by $454,000 primarily due to increase in monthly bonus accrual to reflect
current year's performance. Occupancy and equipment expenses were up by
$225,000, due to full quarter operation of new branch in San Diego and expansion
of Cerritos branch space.
For the nine months ended September 30, 2000, non-interest expenses
totaled $19.9 million compare with $17.8 million for the same period a year ago.
Salaries and employee benefits expenses for the nine months ended September 30,
2000, increased $1.2 million or 14.1% to $10.1 million from $8.9 million for the
same period in 1999. This increase was primarily due to expenses associated with
annual salary adjustments and addition of new employees due to the Company's
recent growth and expansion. The breakdown on non-interest expenses are
reflected below:
<TABLE>
<CAPTION>
QUARTER ENDED QUARTER ENDED INCREASE (DECREASE)
------------------ ------------------- ------------- --------------
9/30/00 9/30/99 AMOUNT PERCENT (%)
------------------ ------------------- ------------- --------------
(Dollars in thousands)
<S> <C> <C> <C> <C>
NON-INTEREST EXPENSE
Salaries and benefits................ $3,607 $3,153 $454 14.40 %
Occupancy and equipment.............. 862 637 225 35.32 %
Data processing...................... 507 487 20 4.11%
Deposit insurance premiums........... 51 38 13 34.21%
Professional fees.................... 213 224 (11) (4.91)%
Advertising.......................... 100 122 (22) (18.03)%
Office supplies...................... 157 128 29 22.66%
Communications....................... 157 131 26 19.85%
Others............................... 1,280 1,647 (367) (22.28)%
------------------ ------------------- ------------- --------------
TOTAL NON-INTEREST EXPENSE: $6,934 $6,567 $367 5.59%
================== =================== ============= ==============
</TABLE>
<TABLE>
<CAPTION>
NINE MONTHS ENDED NINE MONTHS ENDED INCREASE (DECREASE)
------------------ ------------------- ------------- --------------
9/30/00 9/30/99 AMOUNT PERCENT (%)
------------------ ------------------- ------------- --------------
(Dollars in thousands)
<S> <C> <C> <C> <C>
NON-INTEREST EXPENSE
Salaries and benefits................ $10,114 $8,861 $1,253 14.14%
Occupancy and equipment.............. 2,366 1.991 375 18.838%
Data processing...................... 1,556 1,487 69 4.64%
Deposit insurance premiums........... 170 98 72 73.47%
Professional fees.................... 666 721 (55) (7.63)%
Advertising.......................... 278 257 21 8.17%
Office supplies...................... 567 430 137 31.86%
Communications....................... 453 396 57 14.39%
Others............................... 3,740 3,536 204 5.77%
------------------ ------------------- ------------- --------------
TOTAL NON-INTEREST EXPENSE: $19,910 $17,777 $2,133 12.00%
================== =================== ============= ==============
</TABLE>
13
<PAGE>
FINANCIAL CONDITION
SUMMARY OF CHANGES IN BALANCE SHEETS SEPTEMBER 30, 2000 COMPARED TO DECEMBER 31,
1999
At September 30, 2000, the Company's total assets increased by
$206.1 million or 27.8% to $946.3 million from $740.2 million at December 31,
1999. Net loans, net of unearned loan fees and reserve for loan loss and
include loans held for sale, amounted $595.7 million at September 30, 2000,
which represents an increase of $121.0 million or 25.5% from $474.7 million
at December 31, 1999. Total deposits also increased by $193.7 million or
29.53% to $849.4 million at September 30, 2000 from $655.7 million at
December 31, 1999.
INVESTMENT SECURITY PORTFOLIO
The Company classified its securities as held-to-maturity or
available-for-sale under FASB 115. Those securities that the Company has the
ability and intent to hold to maturity are classified as "held-to-maturity
securities". All other securities are classified as "available-for-sale". The
Company owned no trading securities at September 30, 2000. Securities classified
as held-to-maturity are stated at cost, adjusted for amortization of premiums
and accretion of discounts, and securities as available-for-sale are stated at
market value. The securities currently held by the Company are U.S. Treasury
bond, U.S. agencies, municipal bonds, corporate bonds, and an investment in a
tax credit fund.
As of September 30, 2000, held-to-maturity securities totaled $50.7
million and available-for-sale securities totaled $153.6 million, compared to
$66.2 million and $105.0 million at December 31, 1999, respectively. Unrealized
losses, net of tax effect, on securities available-for-sale were $2.1 million
compared with unrealized losses, net of tax effect, of $3.1 million as of
year-end 1999.
<TABLE>
<CAPTION>
AT SEPTEMBER 30, 2000
(UNAUDITED)
-----------------------------------
AMORTIZED MARKET UNREALIZED
COST VALUE GAIN/(LOSS)
---------- ----------- -----------
(Dollars in thousands)
<S> <C> <C> <C>
HELD- TO-MATURITY
U.S. Treasury bond
U.S. agencies $ 1,048 $ 1,034 $ (14)
Municipal bonds 3,821 3,725 (96)
Mortgage backed securities 3,460 3,407 (53)
Corporate bonds 42,387 42,207 (180)
---------- ----------- -----------
TOTAL $ 50,716 $ 50,373 $ (343)
========== =========== ===========
AVAILABLE-FOR-SALE
U.S. agencies $ 60,016 $ 57,360 $ (2,656)
Municipal bonds 18,911 18,483 (428)
Mortgage backed securities 52,120 51,912 (208)
Corporate bonds 26,208 25,840 (368)
---------- ----------- -----------
TOTAL $157,255 $153,595 $ (3,660)
========== =========== ===========
</TABLE>
14
<PAGE>
LOAN PORTFOLIO
The Company carries all loans at face amount, less payments collected,
net of deferred loan origination fees and costs and the allowance for possible
loan losses. Interest on all loans is accrued daily on a simple interest basis.
Once a loan is placed on non-accrual status, accrual of interest is discontinued
and previously accrued interest is reversed. Loans are placed on a non-accrual
status when principal and interest on a loan is past due 90 days or more, unless
a loan is both well-secured and in process of collection.
The Company's gross loans were $609.0 million at September 30, 2000.
This represented an increase of $122.1 million or 25.1% over gross loans of
$486.8 million at December 31, 1999.
Total commercial loans, comprised of domestic commercial,
trade-financing loans, and SBA commercial loans, at September 30, 2000, were
approximately $375.2 million, which represented an increase of $96.2 million or
34.5% from $279.0 million at December 31, 1999. Trade financing loans, at
September 30, 2000, totaled $28.4 million, which represented an increase of
$10.3 million or 56.9% from $18.1 million at December 31, 1999. This increase is
due to the active trade financing as the Asian economy recovered from the
economic crisis in late 1998. Small Business Administration loans (SBA loans)
increased $15.0 million or 45.9% during the last three-quarter of year 2000 to
$47.7 million from $32.7 million at December 31, 1999.
The following table shows the Company's loan composition by type:
<TABLE>
<CAPTION>
SEPTEMBER 30, 2000 DECEMBER 31,1999
(UNAUDITED)
----------------------------- -------------------------------
AMOUNT PERCENT AMOUNT PERCENT
--------------- ------------- --------------- ---------------
LOAN PORTFOLIO COMPOSITION: (Dollars in thousands)
<S> <C> <C> <C> <C>
Commercial and industrial loans............ $375,165 61.61% $278,958 57.31%
Real estate loans.......................... 195,787 32.15% 169,142 34.75%
Installment loans.......................... 38,001 6.24% 38,682 7.94%
--------------- ------------- --------------- ---------------
Total loans outstanding (1)............. 608,953 486,782
Unearned income on loans, net of costs (1,666) (1,508)
Less: Allowance for Loan Losses........... (11,577) (10,624)
--------------- ---------------
NET LOANS RECEIVABLE (1)...................... $595,710 $474,650
=============== ===============
</TABLE>
(1) amount included loans held for sale of $18,155 at September 30, 2000 and $
18,501 at December 31, 1999
At September 30, 2000, the Company's nonperforming assets (nonaccrual
loans, loans 90 days or more past due and still accruing interest, restructured
loans, and other real estate owned) increased to $7.7 million from $4.1 million
last year. The reason was two line of credits, total amount of $4 million,
were classified as past due status due to delayed renewal of line of credit.
Those lines were renewed in October, and cleared from past due status. Excluding
this occurrence, total non-performing assets were about the same level as of
December 31, 1999.
15
<PAGE>
The following table shows the composition of the Company's
nonperforming assets as of the dates indicated.
<TABLE>
<CAPTION>
SEPTEMBER 30, 2000 DECEMBER 31, 1999
(UNAUDITED)
------------------- ------------------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Nonaccrual loans ...................... $2,905 $2,953
Loan past due 90 days or more, still
accruing .............................. 4,469 79
------------------- ------------------
Total Nonperforming Loans .......... 7,374 3,032
Other real estate owned ............... 291
------------------- ------------------
TOTAL NONPERFORMING ASSETS .......... $7,665 $3,032
=================== ==================
</TABLE>
ALLOWANCE AND PROVISION FOR LOAN LOSSES
The allowance for loan losses represents the amounts that the Company
has set aside for the specific purpose of absorbing losses that may occur in the
Company's loan portfolio. The provision for loan losses is an expense charged
against operating income and added to the allowance for loan losses. Management
of the Company continues to carefully monitor the allowance for loan losses in
relation to the size of the Company's loan portfolio and known risks or problem
loans.
At September 30, 2000, the allowance for loan losses increased to
$11.6 million, which represented the increase of $953,000 or 9.0% increase,
compared to $10.6 million at December 31, 1999. The allowance for loan losses
to gross loans ratio was 1.90% at September 30, 2000, which is slightly lower
than 2.18% at December 31, 1999, but well above the average ratio of the peer
banks based on asset size. The Company provided additional reserve of $1.6
million during the first three quarters of 2000, and the management believes
the level of allowance as of September 30, 2000 is adequate to absorb losses
inherent in the loan portfolio.
16
<PAGE>
The following table shows the provisions made for loan losses, the
amount of loans charged off, the recoveries on loans previously charged off
together with the balance in the allowance for possible loan losses at the
beginning and end of each period, the amount of average and total loans
outstanding, and other pertinent ratios as of the dates and for the periods
indicated:
<TABLE>
<CAPTION>
SEPTEMBER 30, 2000 DECEMBER 31, 1999
(UNAUDITED)
-------------------- ----------------------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
LOANS:
Average total loans ................................ $547,577 $407,171
Total gross loans at end of period ................. 608,953 486,782
ALLOWANCE:
BALANCE - BEGINNING OF PERIOD ...................... $ 10,624 $ 10,423
Loans charged off: .............................. 1,289 2,001
Less: Recoveries on loan previous charged off ... 642 1,202
-------------------- ----------------------
Less: Net loan charged-off ......................... 647 799
Add: Provision for loan losses .................... 1,600 1,000
-------------------- ----------------------
BALANCE - END OF PERIOD ............................ $ 11,577 $ 10,624
-------------------- ----------------------
RATIO
Net loan charge-offs to average total loans ......... 0.12% 0.20%
Allowance for loan losses to gross loans at end of
period............................................. 1.90% 2.18%
Net loans charge-offs to allowance for loan losses at
the end of period ................................. 5.59% 7.52%
Allowance for loan losses to nonperforming loans .... 151.04% 350.40%
</TABLE>
DEPOSITS AND OTHER BORROWINGS
At September 30, 2000, the Company's total deposits were $849.4
million. This represented an increase of $193.7 million or 29.53%, from total
deposits of $655.7 million at December 31, 1999. Demand deposits totaled $222.8
million, representing an increase of approximately $29.6 million or 15.35% from
total demand deposits of $193.2 million at December 31, 1999.
Time deposits over $100,000 totaled $191.4 million, which accounted
22.5% of total deposit, at September 30, 2000. This represented an increase of
approximately $67.9 million or 55.0%, compared to $123.5 million at December 31,
1999. Time deposit under $100,000 totaled $265.3 million, which accounted 31.2%
of total deposit, at September 30, 2000. This represented an increase of
approximately $74.6 million or 39.1%, compared to $190.7 million at December 31,
1999.
SHAREHOLDERS' EQUITY AND REGULATORY CAPITAL
In order to ensure adequate levels of capital, the Company conducts an
ongoing assessment of projected sources and uses of capital in conjunction with
projected increases in assets and levels of risk. Management considers, among
other things, on an ongoing basis, cash generated from operations, access to
capital from financial markets or the issuance of additional securities,
including common stock or notes, to meet the Company's capital needs. Total
shareholders' equity was $80.3 million at September 30, 2000. This represented
an increase of $12.5 million or 18.4% over total shareholders' equity of $67.8
million at December 31, 1999.
17
<PAGE>
The federal banking agencies require a minimum ratio of qualifying
total capital to risk-adjusted assets of 8% and a minimum ratio of Tier 1
capital to risk-adjusted assets of 4%. In addition to the risk-based guidelines,
federal banking regulators require banking organizations to maintain a minimum
amount of Tier 1 capital to total assets, referred to as the leverage ratio. For
a banking organization rated in the highest of the five categories used by
regulators to rate banking organizations, the minimum leverage ratio of Tier 1
capital to total assets must be 3%. In addition to these uniform risk-based
capital guidelines and leverage ratios that apply across the industry, the
regulators have the discretion to set individual minimum capital requirements
for specific institutions at rates significantly above the minimum guidelines
and ratios.
The following table presents the amounts of regulatory capital and the
capital ratio for the Company, compared to regulatory capital requirements for
adequacy purposes as of September 30, 2000.
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 2000
(DOLLARS IN THOUSANDS)
-------------------------------------------------------------------------
ACTUAL REQUIRED EXCESS
AMOUNT RATIO AMOUNT RATIO AMOUNT RATIO
------- ------ ------- ----- ------ -----
<S> <C> <C> <C> <C> <C> <C>
Total capital (to risk-weighted assets) $86,753 12.57% $55,214 8% 31,539 4.57%
Tier I capital (to risk-weighted assets) 77,628 11.25% 27,607 4% 50,021 7.25%
Tier I capital (to total assets) 77,628 8.20% 37,854 4% 39,774 4.20%
</TABLE>
18
<PAGE>
ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
GENERAL
Market risk is the risk of loss to future earnings, to fair values, or
to future cash flows that may result from changes in the price of a financial
instrument. The value of a financial instrument may change as a result of
changes in interest rates, foreign currency exchange rates, commodity prices,
equity prices, and other market changes that affect market risk sensitive
instruments. Market risk is attributed to all market risk sensitive financial
instruments, including securities, loans, deposits, and borrowings, as well as
derivative instruments. Our exposure to market risk is a function of our asset
and liability management activities and other roles as a financial intermediary
in customer-related transactions. The objective of market risk management is to
avoid excessive exposure of our earnings and equity to loss and to reduce the
volatility inherent in certain financial instruments.
The management of market risk is governed by policies reviewed and
approved annually by the Board of Directors ("Board"). The Board delegates
responsibility for market risk management to the Asset and Liability Management
Committee (ALCO), which is composed of the Company's senior executives and other
designated officers. ALCO makes changes in the mix of assets and liabilities.
ALCO also reviews and approves market risk-management programs and market risk
limits
LIQUIDITY AND INTEREST RATE SENSITIVITY
Liquidity risk is the risk to earnings or capital resulting from the
Company's inability to meet its obligations when they come due without incurring
unacceptable losses. Liquidity risk includes the ability to manage unplanned
decreases or changes in funding sources and to recognize or address changes in
market conditions that affect the Company's ability to liquidate assets quickly
and with a minimum loss of value. Factors considered in liquidity risk
management are stability of the deposit base, marketability, maturity, and
pledging of investments, and demand for credit.
In general, the Company manages liquidity risk daily by controlling
the level of federal funds and the use of funds provided by the cash flow
from the investment portfolio and scheduled loan repayment. To meet
unexpected demands, lines of credit are maintained with correspondent banks,
and the Federal Reserve Bank. The sale of securities available-for-sale also
can also serve as a contingent source of funds. Increases in deposit rates
are considered a last resort as a means of raising funds to increase
liquidity.
The Company's liquid assets include cash and cash equivalents,
interest-bearing deposits in corresponding banks and securities
available-for-sale. The aggregate of these assets totaled $266.0 million at
September 30, 2000 compared to $ 168.6 million at December 31, 1999.
Because the primary sources and uses of funds are loans and deposits,
the relationship between gross loans and deposits provides a useful measure of
the Company's liquidity. Typically, the closer the ratio of loans to deposits is
to 100%, the more reliant the Company relies on its loan portfolio to provide
for short- term liquidity needs. Because repayment of loans tends to be less
predictable than the maturity of investments and other liquid resources, the
higher the
19
<PAGE>
loan to deposit ratio, the less liquid are the Company's assets. For
the first nine months of 2000, the Company's loan to deposit ratio averaged
73.43%, compared to an average ratio of 58.26% for the same period last year.
The Company is engaged in asset and liability management activities
with the objective of reducing adverse changes in earnings as a result of
changes in interest rates. The management monitors the interest rate risk
relates to the timing and magnitude of the repricing of assets compared to
liabilities and has the control of risks associated with movements in
interest rates.
The ALCO meets monthly to monitor the interest rate risk and may direct
changes in the composition of the balance sheet. The company's balance sheet is
inherently asset sensitive, which means that assets generally reprice more often
than liabilities. Since an asset-sensitive balance sheet tends to reduce net
interest income when interest rates decline and to increase net interest income
when interest rate rise, careful forecast of interest rate and security
portfolio changes are used to manage the interest rate risk.
The Company currently uses the interest rate gap to measure interest
rate risk. It is the difference between interest-earning assets and
interest-bearing liabilities maturing or repricing within specified periods. The
gap analysis presented below indicates that assets that are rate sensitive
within one year exceeded liabilities within that same period by $10.7 million at
September 30, 2000. The following table shows the Company's gap position as of
September 30, 2000.
20
<PAGE>
<TABLE>
<CAPTION>
(Dollars in thousands)
AFTER SIX AFTER ONE
MONTHS BUT YEAR BUT
WITHIN WITHIN ONE WITHIN FIVE AFTER NON-SENSITIVE
SIX MONTHS YEAR YEARS FIVE YEARS ASSETS TOTAL
----------- ------------ -------------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
CASH $63,528 $63,528
INVESTMENTS:
Fixed $34,194 $27,747 $81,132 $58,866 201,941
Floating 6,030 6,030
Unrealized Loss (3,660) (3,660)
LOANS:
Fixed 16,489 30,682 55,492 59,775 162,438
Floating 425,281 7,670 13,226 338 446,515
Unearned income & LLR (13,243) (13,243)
Federal funds sold 48,600 48,600
Accrued interest receivable 6,651 6,651
Customer liabilities 2,254 2,254
Other assets 2,776 22,509 25,285
----------- ------------ -------------- ------------ ------------- -----------
TOTAL ASSETS $539,499 $66,099 $149,850 $121,757 $69,134 $946,339
=========== ============ ============== ============ ============= ===========
LIABILITIES
DEPOSITS:
Demand deposit 17,825 69,069 113,640 22,280 222,814
Time certificate of 90,069 98,195 2,902 200 191,366
deposit
$100,000 or more
Time certificate of 91,748 150,383 22,978 183 265,292
deposit
Under $100,000
Money market 7,374 48,153 46,075 3,688 105,290
Savings Accounts 4,278 27,835 26,893 5,623 64,629
ACCRUED INTEREST PAYABLE 5,220 5,220
ACCEPTANCE OUTSTANDING 2,254 2,254
OTHER BORROWED MONEY 3,888 3,888
OTHER LIABILITIES 5,279 5,279
----------- ------------ -------------- ------------ ------------- -----------
TOTAL LIABILITIES 222,656 393,635 212,488 31,974 5,279 866,032
----------- ------------ -------------- ------------ ------------- -----------
SHAREHOLDERS' EQUITY 80,307 80,307
------------- -----------
TOTAL LIABILITIES AND 222,656 393,635 212,488 31,974 85,586 946,339
=========== ============ ============== ============ ============= ===========
SHAREHOLDERS' EQUITY
Net gap position 316,843 (327,536) (62,638) 89,783 (16,452)
Net cumulative gap position 316,843 (10,693) (73,331) 16,452
Cumulative gap/assets 33.48% (1.13)% (7.75)% 1.74%
Cumulative gap/interest
earning assets 37.21% (1.26)% (8.61)% 1.93%
----------- ------------ -------------- ------------ ------------- -----------
</TABLE>
21
<PAGE>
PART II
ITEM 1 LEGAL PROCEEDINGS
None
ITEM 2 CHANGES IN SECURITIES
At September 15, 2000, 20,271 new shares were issued to employee of
Hanmi Bank, as bonus at $13.75.
ITEM 3 DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5 OTHER INFORMATION
None
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
(b) Reports on Form 8-K
None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Hanmi Financial Corporation
Date: November 14, 2000 By /s/ Yong Ku Choe
---------------------------------
Yong Ku Choe
Chief Financial Officer
(Principal financial officer
and duly authorized signatory)
22
