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Wilshire Bancorp Reports Net Income of $17.4 Million or $0.22 per Share for Second Quarter 2016

LOS ANGELES, July 18, 2016 (GLOBE NEWSWIRE) -- Wilshire Bancorp, Inc. (NASDAQ:WIBC) (the “Company”), the holding company for Wilshire Bank (the “Bank”), today reported net income of $17.4 million, or $0.22 per diluted common share, for the quarter ended June 30, 2016. This compares to net income of $15.6 million, or $0.20 per diluted common share, for the same period of the prior year, and net income of $13.2 million, or $0.17 per diluted common share, for the first quarter of 2016.

Jae Whan (J.W.) Yoo, President and CEO of Wilshire Bancorp, said, “We delivered a strong quarter with improvements in loan growth, non-interest income, credit quality and operating efficiencies. We continue to see well diversified loan production with growth in our commercial and construction portfolios, off-setting a slight decline in our commercial real estate portfolio.

“As we near the completion of our merger of equals with BBCN Bancorp, we are eagerly looking forward to the opportunity to better serve our markets as the premier Korean-American bank in the United States,” said Mr. Yoo.

Q2 2016 Summary

  • Net income totaled $17.4 million, or $0.22 per diluted common share, for the second quarter of 2016
  • Return on average assets of 1.46% and return on average equity of 12.51% for the second quarter of 2016
  • Net interest margin of 3.53% for the second quarter of 2016, compared to 3.54% for the first quarter of 2016
  • Gain on sale of OREO was $3.7 million for the second quarter of 2016, compared to $0 for the first quarter of 2016
  • Loan originations of $408.1 million during the second quarter of 2016, compared to $276.1 million for the first quarter of 2016
  • Loans receivable (net of deferred fees and costs) totaled $3.85 billion at June 30, 2016, an increase of 1.5% from $3.79 billion at March 31, 2016
  • Total deposits were $4.01 billion at June 30, 2016, an increase of 4.1% from $3.85 billion at March 31, 2016
  • Demand deposits totaled $1.13 billion at June 30, 2016, an increase of 2.5% from $1.11 billion at March 31, 2016

STATEMENT OF OPERATIONS

Net interest income before provision for losses on loans and loan commitments totaled $39.2 million for the second quarter of 2016, an increase of 0.7% from $38.9 million for the first quarter of 2016 and an increase of 4.5% from $37.5 million for the second quarter of 2015. Relative to the first quarter of 2016, an increase in average earning assets was partially offset by a slight decline in net interest margin.

Net interest margin was 3.53% for the second quarter of 2016, compared to 3.54% for the first quarter of 2016, and 3.59% for the second quarter of 2015. The decrease in net interest margin compared to the first quarter of 2016 was primarily attributable to an increase in the cost of deposits.

Loan yields were 4.62% for the second quarter of 2016, compared to 4.61% for the first quarter of 2016, and 4.78% for the second quarter of 2015. The increase in loan yields for the second quarter of 2016, compared to the first quarter of 2016, was primarily due to an increase in yield on commercial real estate loans.

The total cost of deposits was 0.64% for the second quarter of 2016, compared to 0.62% for the first quarter of 2016, and 0.61% for the second quarter of 2015. Compared to the first quarter of 2016, the increase in the total cost of deposits was attributable to increases in rates in all deposit categories.

Non-Interest Income

Total non-interest income was $9.7 million for the second quarter of 2016, compared to $8.5 million for the first quarter of 2016, and $11.3 million for the second quarter of 2015.

The Company recognized $3.4 million in gain on sale of loans during the second quarter of 2016, compared to $2.7 million for the first quarter of 2016, and $4.2 million for the second quarter of 2015. The increase in gain on sale of loans for the second quarter of 2016, compared to the previous quarter, was due to an increase in sales of Small Business Administration (“SBA”) and residential mortgage loans. Gain on sale of loans in the second quarter of 2016 consisted of $2.0 million in gains on sales of SBA loans and $1.4 million in gains on sales of residential mortgage loans.

Other non-interest income totaled $3.5 million for the second quarter of 2016, compared to $2.9 million for the first quarter of 2016 and $4.0 million for the second quarter of 2015. The increase in other non-interest income, compared to the first quarter of 2016, was due to an increase in loan servicing income and income recorded from the fair value change of servicing assets.

Non-Interest Expense

Total non-interest expense was $21.6 million for the second quarter of 2016, compared with $26.7 million for the first quarter of 2016, and $24.7 million for the second quarter of 2015. Non-interest expense in the second quarter of 2016 included $527,000 in merger-related costs consisting mostly of consulting and legal expenses related to the proposed merger of equals with BBCN.

Total salaries and employee benefits expense was $13.1 million for the second quarter of 2016, compared to $14.8 million for the first quarter of 2016, and $14.2 million for the second quarter of 2015. The decrease in salaries and employee benefits for the second quarter of 2016, compared to the previous quarter, was primarily due to lower payroll taxes, bonus accrual expense, and stock-based compensation expense.

Other non-interest expense was $3.4 million for the second quarter of 2016, compared with $6.9 million for the first quarter of 2016, and $6.2 million for the second quarter of 2015. Other non-interest expense for the second quarter of 2016 was reduced by a $3.7 million gain on the sale of other real estate owned (OREO).

The Company’s operating efficiency ratio was 44.2% for the second quarter of 2016, compared with 56.3% for the first quarter of 2016, and 50.6% for the second quarter of 2015. The efficiency ratio before including gain on sale of OREO of $3.7 million was 51.8% for the second quarter of 2016.*

* “Efficiency ratio before gain on sale of OREO” is a Non-GAAP measure of financial performance. Please refer to the “Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures” table at the end of this press release for a reconciliation.

BALANCE SHEET

Total loans receivable (net of deferred fees and costs) were $3.85 billion at June 30, 2016, compared to $3.79 billion at March 31, 2016. During the second quarter of 2016, increases in commercial and industrial loans, residential real estate loans and real estate construction loans receivable were partially offset by a decrease in commercial real estate loans. Total loans held-for-sale decreased to $24.2 million at June 30, 2016, from $90.4 million at March 31, 2016, due to a decrease in both residential mortgage and SBA loans held-for-sale. During the second quarter of 2016, part of the residential mortgage loans sold were through a bulk sale.

The following table shows total loans receivable, loans held-for-sale, and total loans by loan type:

Quarter Ended
(Dollars In Thousands) (Unaudited)June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015
Construction$ 50,240 $ 36,181 $ 19,541 $ 18,146 $ 16,050
Real Estate Secured 2,954,090 2,962,964 2,992,824 2,810,420 2,723,458
Commercial & Industrial 838,008 783,487 792,243 789,422 765,655
Consumer 9,590 12,304 15,096 13,284 14,622
Total Loans Receivable * 3,851,928 3,794,936 3,819,704 3,631,272 3,519,785
Loans Held-For-Sale 24,154 90,392 25,223 13,316 25,269
Total Loans *$ 3,876,082 $ 3,885,328 $ 3,844,927 $ 3,644,588 $ 3,545,054
* Total loans receivable and total loans are net of deferred fees and costs as shown in the consolidated balance sheet presentation


The following table shows quarterly loan originations:

Quarter Ended
(Dollars In Thousands) (Unaudited)June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015
Real Estate Secured$164,373 40% $127,145 46% $273,613 54% $176,605 43% $121,066 41%
Commercial & Industrial 127,709 31% 34,268 12% 94,128 19% 107,952 26% 46,438 16%
Consumer 46 0% 0% 55 0% 360 0% 124 0%
SBA 26,314 7% 26,801 10% 37,897 8% 21,871 5% 25,648 9%
Residential Mortgage 69,621 17% 87,866 32% 95,159 19% 102,383 25% 89,652 31%
Warehouse Lines of Credit* 20,000 5% 0% 2,000 0% 7,000 1% 10,000 3%
Total Loan Originations$408,063 100% $276,080 100% $502,852 100% $416,171 100% $292,928 100%
* Warehouse lines of credit are reported as commercial and industrial loans on the consolidated balance sheet.


Originations for the second quarter of 2016 totaled $408.1 million, compared to $276.1 million for the first quarter of 2016, and $292.9 million for the second quarter of 2015. The increase in loan originations for the three months ended June 30, 2016, compared to the previous quarter, was primarily due to an increase in commercial and industrial loans and warehouse lines of credit.

Total SBA loans held-for-sale at the end of the second quarter of 2016 were $8.2 million, compared to $11.6 million at the end of the previous quarter. Residential mortgage loans held-for-sale at the end of the second quarter of 2016 were $15.2 million, compared to $78.0 million at the end of the previous quarter.

Total deposits increased to $4.01 billion at June 30, 2016, from $3.85 billion at March 31, 2016, primarily due to increases in non-interest bearing demand deposits and time deposits.

CREDIT QUALITY

During the second quarter of 2016, the Company continued to experience stable asset quality and a continued low level of charge-offs. As a result, the Company determined that no provision for losses on loans and loan commitments was required for the second quarter of 2016.

The allowance for loan losses totaled $53.2 million, or 1.38% of gross loans (excluding loans held-for-sale), at June 30, 2016, compared to $52.7 million, or 1.38% of gross loans (excluding loans held-for-sale), at March 31, 2016. The coverage ratio of the allowance for loan losses to non-performing assets was 173.24% at June 30, 2016, compared with 149.08% at March 31, 2016.

Non-Performing Loans

At June 30, 2016, total non-performing loans were $19.9 million, or 0.51% of gross loans, compared to $25.2 million, or 0.65% of total gross loans, at March 31, 2016.

The following table shows total non-performing loans by loan type:

NON-PERFORMING LOANSQuarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2016 Mar 31, 2016 Dec 31, 2015 Sep 30, 2015 Jun 30, 2015
(Net of SBA Guaranty Portions)
Real Estate Secured$ 15,510 $ 20,007 $ 15,422 $ 20,123 $ 23,235
Commercial & Industrial 4,344 5,194 6,272 7,058 7,617
Total Non-Performing Loans$ 19,854 $ 25,201 $ 21,694 $ 27,181 $ 30,852

Net Charge-offs/Recoveries

During the second quarter of 2016, the Company had total gross charge-offs of $479,000, and recoveries of $993,000, which resulted in net recoveries of $514,000, compared to net charge-offs of $237,000 for the first quarter of 2016.

Gross charge-offs and recoveries by loan type are reflected in the tables below:

GROSS LOAN CHARGE-OFFSQuarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2016 Mar 31, 2016 Dec 31, 2015 Sep 30, 2015 Jun 30, 2015
Real Estate Secured$ 82 $ 219 $ 13 $ 605 $ 249
Commercial & Industrial 296 379 1,392 1,270 310
Consumer 101
Total Loan Charge-Offs$ 479 $ 598 $ 1,405 $ 1,875 $ 559


LOAN RECOVERIESQuarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2016 Mar 31, 2016 Dec 31, 2015 Sep 30, 2015 Jun 30, 2015
Real Estate Secured$ 796 $ 46 $ 3,242 $ 1,867 $ 970
Commercial & Industrial 191 315 452 803 240
Consumer 6
Total Loan Recoveries$ 993 $ 361 $ 3,694 $ 2,670 $ 1,210

Other measures of credit quality are shown in the following tables:

DELINQUENT LOANS - By Days Past Due Quarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2016 Mar 31, 2016 Dec 31, 2015 Sep 30, 2015 Jun 30, 2015
(Net of SBA Guaranty Portions)
30 - 59 Days Past Due$ 7,454 $ 3,608 $ 4,315 $ 4,911 $ 3,615
60 - 89 Days Past Due 253 1,491 1,643 1,143 7,576
90 Days, and still accruing
Total Delinquent Loans$ 7,707 $ 5,099 $ 5,958 $ 6,054 $ 11,191


TROUBLED DEBT RESTRUCTURED LOANS (“TDR”)Quarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2016 Mar 31, 2016 Dec 31, 2015 Sep 30, 2015 Jun 30, 2015
(Net of SBA Guaranty Portions)
Real Estate Secured$ 20,671 $ 23,376 $ 22,311 $ 24,188 $ 29,424
Commercial & Industrial 15,249 15,015 15,681 16,578 13,469
Total TDR Loans$ 35,920 $ 38,391 $ 37,992 $ 40,766 $ 42,893


LOAN CLASSIFICATIONSQuarter Ended
(Dollars In Thousands) (Unaudited) Jun 30, 2016 Mar 31, 2016 Dec 31, 2015 Sep 30, 2015 Jun 30, 2015
(Net of SBA Guaranty Portions)
Special Mention$ 162,842 $ 161,119 $ 120,019 $ 118,290 $ 86,118
Substandard 84,754 85,193 80,310 82,000 96,666
Doubtful 41 41 41 2,182 5,301
Total Criticized and Classified Loans$ 247,637 $ 246,353 $ 200,370 $ 202,472 $ 188,085
Total Classified Loans$ 84,795 $ 85,234 $ 80,351 $ 84,182 $ 101,967

CAPITAL RATIOS

As of June 30, 2016, all of the Company’s capital ratios remain in excess of “well capitalized” regulatory requirements as shown in the following table:

(Dollars In Thousands, Except Per Share Info)June 30, 2016 Well Capitalized
Regulatory Requirements
Total Excess Above Well
Capitalized Requirements
Tier 1 Leverage Capital Ratio 11.85% 5.00% 319,311
Tier 1 Common Equity Risk-Based Capital Ratio 11.67% 6.50% 231,807
Tier 1 Risk-Based Capital Ratio 13.35% 8.00% 221,338
Total Risk-Based Capital Ratio 14.60% 10.00% 190,376
Tangible Common Equity To Tangible Assets * 10.18% N/A N/A
Tangible Common Equity Per Common Share *$ 6.22 N/A N/A


* “Tangible Common Equity” and “Tangible Assets” are Non-GAAP measures of financial performance. Please refer to the “Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures” table at the end of this press release for a reconciliation of Tangible Common Equity to Shareholders’ Equity and Tangible Assets to Total Assets.


CONFERENCE CALL

Management will host its quarterly conference call on July 19, 2016, at 11:00 a.m. PT (2:00 p.m. ET). Investment professionals are invited to participate in the call by dialing toll-free 844-578-9673 (domestic) or 508-637-5657 (international) and providing passcode number 42220175.

ABOUT WILSHIRE BANCORP

Headquartered in Los Angeles, Wilshire Bancorp is the parent company of Wilshire Bank, which operates 35 branch offices in California, Texas, Alabama, Georgia, New Jersey, and New York. Wilshire Bancorp also operates five loan production offices of which three are utilized primarily for the origination of loans under the Small Business Administration lending program located in Colorado, Georgia, and Washington, and two that are utilized primarily for the origination of residential mortgage loans located in California. Wilshire Bank is a community bank with a focus on commercial real estate lending and general commercial banking, with its primary markets encompassing the multi-ethnic populations of Los Angeles, New York, New Jersey, and Texas. For more information, please go to www.wilshirebank.com.

ABOUT BBCN BANCORP, INC.

BBCN Bancorp, Inc. is the holding company of BBCN Bank, the largest Korean-American bank in the nation. Headquartered in Los Angeles and serving a diverse mix of customers mirroring its communities, BBCN operates 50 branches in California, New York, New Jersey, Illinois, Washington, and Virginia; eight loan production offices in Seattle, Denver, Dallas, Atlanta, Northern California, Annandale, Virginia, Portland, Oregon, and Fremont, California; and a representative office in Seoul, Korea. BBCN specializes in core business banking products for small and medium-sized businesses, with an emphasis in commercial real estate and business lending, SBA lending and international trade financing. BBCN Bank is a California-chartered bank and its deposits are insured by the FDIC to the extent provided by law. BBCN is an Equal Opportunity Lender.

FORWARD-LOOKING STATEMENTS

This press release contains statements regarding the proposed transaction between Wilshire Bancorp and BBCN Bancorp. These statements are based on current expectations, estimates, forecasts and projections and management assumptions about the future performance of each of Wilshire Bancorp, BBCN Bancorp and the combined company, as well as the businesses and markets in which they do and are expected to operate. These statements constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as “expects,” “believes,” “estimates,” “anticipates,” “targets,” “goals,” “projects,” “intends,” “plans, “seeks,” and variations of such words and similar expressions are intended to identify such forward-looking statements which are not statements of historical fact. These forward-looking statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions that are difficult to assess. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The closing of the proposed transaction remains subject to customary closing conditions. There is no assurance that such conditions will be met or that the proposed transaction will be consummated within the expected time frame, or at all. If the transaction is consummated, factors that may cause actual outcomes to differ from what is expressed or forecasted in these forward-looking statements include, among things: difficulties and delays in integrating Wilshire Bancorp and BBCN Bancorp and achieving anticipated synergies, cost savings and other benefits from the transaction; higher than anticipated transaction costs; deposit attrition, operating costs, customer loss and business disruption following the merger, including difficulties in maintaining relationships with employees, may be greater than expected; required governmental approvals of the merger may not be obtained on its proposed terms and schedule, or without regulatory constraints that may limit growth; competitive pressures among depository and other financial institutions may increase significantly and have an effect on revenues; the strength of the United States economy in general, and of the local economies in which the combined company will operate, may be different than expected, which could result in, among other things, a deterioration in credit quality or a reduced demand for credit and have a negative effect on the combined company’s loan portfolio and allowance for loan losses; changes in the U.S. legal and regulatory framework; and adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) which would negatively affect the combined company’s business and operating results.

For a more complete list and description of such risks and uncertainties, refer to Wilshire Bancorp’s Form 10-K for the year ended December 31, 2015, as amended, and BBCN Bancorp’s Form 10-K for the year ended December 31, 2015, as amended, as well as other filings made by Wilshire Bancorp and BBCN Bancorp with the SEC. Except as required under the U.S. federal securities laws and the rules and regulations of the SEC, Wilshire Bancorp and BBCN Bancorp disclaim any intention or obligation to update any forward-looking statements after the distribution of this press release, whether as a result of new information, future events, developments, changes in assumptions or otherwise.


CONSOLIDATED BALANCE SHEET
(Dollars In Thousands) (Unaudited) June 30, March 31, Three Months June 30, Twelve Months
2016 2016 % Change 2015 % Change
ASSETS:
Cash and due from banks $ 301,103 $ 115,444 161% $ 475,834 -37%
Federal funds sold and other cash equivalents 136 133 2% 54 152%
Total Cash and Cash Equivalents 301,239 115,577 161% 475,888 -37%
Deposits held in other financial institutions 0% 7,750 -100%
Investment securities available for sale 490,574 512,257 -4% 358,331 37%
Investment securities held to maturity 18 19 -5% 24 -25%
Total Investment Securities 490,592 512,276 -4% 358,355 37%
Total Loans Held-For-Sale 24,154 90,392 -73% 25,269 -4%
Real estate construction 50,240 36,181 39% 16,050 213%
Residential real estate 234,979 226,960 4% 192,732 22%
Commercial real estate 2,719,111 2,736,004 -1% 2,530,726 7%
Commercial and industrial 838,008 783,487 7% 765,655 9%
Consumer 9,590 12,304 -22% 14,622 -34%
Total loans receivable, net of deferred fees and costs 3,851,928 3,794,936 2% 3,519,785 9%
Allowance for loan losses (53,182) (52,668) 1% (48,821) 9%
Loans Receivable, Net of Allowance for Loan Losses 3,798,746 3,742,268 2% 3,470,964 9%
Accrued interest receivable 8,882 9,171 -3% 8,635 3%
Due from customers on acceptances 8,900 8,900 0% 3,940 126%
Other real estate owned 10,844 10,128 7% 6,559 65%
Premises and equipment 15,077 15,718 -4% 14,366 5%
Federal home loan bank (FHLB) stock, at cost 16,539 16,539 0% 16,539 0%
Cash surrender value of life insurance 25,317 25,174 1% 23,610 7%
Investment in affordable housing partnerships 45,627 47,257 -3% 42,193 8%
Deferred income taxes 17,803 17,897 -1% 17,475 2%
Servicing assets 19,219 19,324 -1% 20,123 -4%
Goodwill 67,473 67,473 0% 67,473 0%
Other assets 36,373 22,307 63% 31,958 14%
TOTAL ASSETS $4,886,785 $4,720,401 4% $4,591,097 6%
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Non-interest bearing demand deposits $1,134,671 $1,106,805 3% $1,025,133 11%
Savings and interest checking 174,123 173,557 0% 158,734 10%
Money market deposits 1,005,142 993,733 1% 962,855 4%
Time deposits in denomination of $100,000 or more 1,407,025 1,336,311 5% 1,475,340 -5%
Other time deposits 289,358 243,166 19% 280,894 3%
Total Deposits 4,010,319 3,853,572 4% 3,902,956 3%
FHLB borrowings 200,000 200,000 0% 50,000 300%
Acceptance outstanding 8,900 8,900 0% 3,940 126%
Junior subordinated debentures 72,139 72,077 0% 71,895 0%
Accrued interest payable 2,417 2,400 1% 2,373 2%
Other liabilities 32,396 37,204 -13% 44,350 -27%
Total Liabilities 4,326,171 4,174,153 4% 4,075,514 6%
Common stock 234,917 234,386 0% 232,893 1%
Retained earnings 317,393 304,763 4% 278,503 14%
Accumulated other comprehensive income 8,304 7,099 17% 4,187 98%
Total Shareholders’ Equity 560,614 546,248 3% 515,583 9%
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $4,886,785 $4,720,401 4% $4,591,097 6%


CONSOLIDATED STATEMENT OF OPERATIONS
(Dollars In Thousands, Except Per Share Data) (Unaudited)
Quarter Ended Three Mths Quarter Ended Twelve Mths
June 30, 2016 March 31, 2016 % Change June 30, 2015 % Change
INTEREST INCOME
Interest and fees on loans $ 44,273 $ 43,665 1% $ 41,599 6%
Interest on investment securities 2,328 2,460 -5% 1,929 21%
Interest on federal funds sold and others 149 124 20% 264 -44%
Total Interest Income 46,750 46,249 1% 43,792 7%
INTEREST EXPENSE
Deposits 6,160 5,932 4% 5,661 9%
FHLB advances and other borrowings 1,423 1,408 1% 658 116%
Total Interest Expense 7,583 7,340 3% 6,319 20%
Net interest income before provision for losses on
loans and loan commitments 39,167 38,909 1% 37,473 5%
Provision for losses on loans and loan commitments 300 -100% 0%
Net interest income after provision for losses on loans and loan commitments 39,167 38,609 1% 37,473 5%
NONINTEREST INCOME
Service charges on deposits 2,748 2,851 -4% 3,159 -13%
Gain on sale of SBA loans 1,956 1,297 51% 2,631 -26%
Gain on sale of residential loans 1,450 830 75% 928 56%
Gain on sale of other loans 545 -100% 625 -100%
Other 3,539 2,935 21% 3,971 -11%
Total Noninterest Income 9,693 8,458 15% 11,314 -14%
NONINTEREST EXPENSES
Salaries and employee benefits 13,148 14,783 -11% 14,164 -7%
Occupancy and equipment 3,236 3,276 -1% 3,196 1%
Data processing 1,273 1,204 6% 1,089 17%
Merger-related costs 527 458 15% 0%
Other 3,395 6,932 -51% 6,218 -45%
Total Noninterest Expenses 21,579 26,653 -19% 24,667 -13%
Income before income taxes 27,281 20,414 34% 24,120 13%
Income taxes provision 9,917 7,224 37% 8,567 16%
NET INCOME $ 17,364 $ 13,190 32% $ 15,553 12%
PER COMMON SHARE INFORMATION:
Basic income per common share $ 0.22 $ 0.17 31% $ 0.20 11%
Diluted income per common share $ 0.22 $ 0.17 31% $ 0.20 11%
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING:
Basic 78,872,353 78,674,604 78,459,708
Diluted 79,137,512 78,974,448 78,818,847

CONSOLIDATED STATEMENT OF OPERATIONS
(Dollars In Thousands, Except Per Share Data) (Unaudited)
Six Months Ended Twelve Mths
June 30, 2016 June 30, 2015 % Change
INTEREST INCOME
Interest and fees on loans $ 87,938 $ 81,687 8%
Interest on investment securities 4,788 3,897 23%
Interest on federal funds sold and others 273 456 -40%
Total Interest Income 92,999 86,040 8%
INTEREST EXPENSE
Deposits 12,092 10,758 12%
FHLB advances and other borrowings 2,831 1,318 115%
Total Interest Expense 14,923 12,076 24%
Net interest income before provision for losses on loans and loan commitments 78,076 73,964 6%
Provision for losses on loans and loan commitments 300 0%
Net interest income after provision for losses on loans and loan commitments 77,776 73,964 5%
NONINTEREST INCOME
Service charges on deposits 5,599 6,266 -11%
Gain on sale of SBA loans 3,253 4,876 -33%
Gain on sale of residential loans 2,280 1,189 92%
Gain on sale of other loans 545 4,925 -89%
Other 6,474 9,325 -31%
Total Noninterest Income 18,151 26,581 -32%
NONINTEREST EXPENSES
Salaries and employee benefits 27,931 26,829 4%
Occupancy and equipment 6,512 6,569 -1%
Data processing 2,477 2,131 16%
Merger-related costs 985 0%
Other 10,327 12,047 -14%
Total Noninterest Expenses 48,232 47,576 1%
Income before income taxes 47,695 52,969 -10%
Income taxes provision 17,141 18,797 -9%
NET INCOME $ 30,554 $ 34,172 -11%
PER COMMON SHARE INFORMATION:
Basic income per common share $ 0.39 $ 0.44 -11%
Diluted income per common share $ 0.39 $ 0.43 -11%
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING:
Basic 78,773,479 78,393,475
Diluted 79,048,014 78,736,870



SUMMARY OF FINANCIAL DATA
(Dollars In Thousands, Except Per Share Data) (Unaudited)
Quarter Ended
AVERAGE BALANCES June 30, 2016 March 31, 2016 June 30, 2015
Average Assets $ 4,742,224 $ 4,698,333 $ 4,472,065
Average Equity 555,351 544,527 513,338
Average Net Loans 3,837,219 3,789,591 3,481,181
Average Deposits 3,866,991 3,833,838 3,736,003
Average Time Deposits of $100,000 or more 1,358,446 1,342,858 1,417,860
Average FHLB & Other Borrowings 200,000 201,209 112,088
Average Interest Earning Assets 4,457,822 4,417,456 4,197,297
Six Months Ended
AVERAGE BALANCES June 30, 2016 June 30, 2015
Average Assets $ 4,720,279 $ 4,364,443
Average Equity 549,939 506,754
Average Net Loans 3,813,405 3,417,163
Average Deposits 3,850,415 3,613,821
Average Time Deposits of $100,000 or more 1,350,652 1,358,242
Average FHLB & Other Borrowings 200,604 131,265
Average Interest Earning Assets 4,437,639 4,087,478
Quarter Ended
PROFITABILITY June 30, 2016 March 31, 2016 June 30, 2015
Annualized Return on Average Assets 1.46% 1.12% 1.39%
Annualized Return on Average Equity 12.51% 9.69% 12.12%
Efficiency Ratio 44.16% 56.27% 50.56%
Annualized Operating Expense/Average Assets 1.82% 2.27% 2.21%
Annualized Net Interest Margin 3.53% 3.54% 3.59%
Six Months Ended
PROFITABILITY June 30, 2016 June 30, 2015
Annualized Return on Average Assets 1.29% 1.57%
Annualized Return on Average Equity 11.11% 13.49%
Efficiency Ratio 50.12% 47.32%
Annualized Operating Expense/Average Assets 2.04% 2.18%
Annualized Net Interest Margin 3.53% 3.64%
As Of
DEPOSIT COMPOSITION June 30, 2016 Cost of Funds March 31, 2016 Cost of Funds June 30, 2015 Cost of Funds
Noninterest Bearing Demand Deposits 28.3% 0.00% 28.7% 0.00% 26.3% 0.00%
Savings & Interest Checking 4.3% 1.28% 4.5% 1.25% 4.1% 1.30%
Money Market Deposits 25.1% 0.73% 25.8% 0.71% 24.7% 0.66%
Time Deposits of $100,000 or More 35.1% 0.94% 34.7% 0.91% 37.8% 0.86%
Other Time Deposits 7.2% 0.95% 6.3% 0.92% 7.2% 0.90%
Total Deposits 100.0% 0.64% 100.0% 0.62% 100.0% 0.61%
As Of
CAPITAL RATIOS June 30, 2016 March 31, 2016 June 30, 2015
Tier 1 Leverage Ratio 11.85% 11.67% 11.64%
Tier 1 Common Equity Risk-Based Capital Ratio 11.67% 11.47% 11.91%
Tier 1 Risk-Based Capital Ratio 13.35% 13.17% 13.78%
Total Risk-Based Capital Ratio 14.60% 14.42% 15.03%
Total Shareholders' Equity $ 560,614 $ 546,248 $ 515,583
Book Value Per Common Share $ 7.11 $ 6.93 $ 6.57
Tangible Common Equity Per Common Share * $ 6.22 $ 6.03 $ 5.66
Tangible Common Equity to Tangible Assets * 10.18% 10.23% 9.83%
* Excludes goodwill and other intangible assets


ALLOWANCE FOR LOAN LOSSES
(Dollars In Thousands) (Unaudited)
Quarter Ended
June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015
Balance at beginning of period $ 52,668 $ 52,405 $ 50,116 $ 48,821 $ 48,170
Provision for losses on loans 500 500
Recoveries on loans previously charged-off 993 361 3,694 2,670 1,210
Gross loan charge-offs (479) (598) (1,405) (1,875) (559)
Balance at end of period $ 53,182 $ 52,668 $ 52,405 $ 50,116 $ 48,821
Net Loan Charge-offs / Average Net Loans -0.01% 0.01% -0.06% -0.02% -0.02%
Charge-offs / Average Total Loans 0.01% 0.02% 0.04% 0.05% 0.02%
Allowance for Loan Losses / Gross Loans* 1.38% 1.38% 1.37% 1.38% 1.38%
Allowance for Loan Losses / Non-accrual Loans 267.87% 208.99% 241.56% 184.38% 158.24%
Allowance for Loan Losses / Non-performing Loans 267.87% 208.99% 241.56% 184.38% 158.24%
Allowance for Loan Losses / Non-performing Assets 173.24% 149.08% 169.74% 130.23% 130.50%
Allowance for Loan Losses / Classified Loans 63.95% 61.79% 65.22% 59.53% 47.88%
* Excludes held-for-sale loans
NON-PERFORMING ASSETS
(Dollars In Thousands, Net of SBA Guaranty) Quarter Ended
(Unaudited) June 30, 2016 March 31, 2016 December 31, 2015 September 30, 2015 June 30, 2015
Non-accrual loans $ 19,854 $ 25,201 $ 21,694 $ 27,181 $ 30,852
Loans 90 days or more past due and still accruing
Total Non-performing Loans 19,854 25,201 21,694 27,181 30,852
Total OREO 10,844 10,128 9,179 11,302 6,559
Total Non-performing Assets $ 30,698 $ 35,329 $ 30,873 $ 38,483 $ 37,411
Total Non-performing Loans/Gross Loans 0.51% 0.65% 0.56% 0.74% 0.87%
Total Non-performing Assets/Total Assets 0.63% 0.75% 0.65% 0.81% 0.81%
ALLOWANCE FOR OFF-BALANCE SHEET ITEMS
(Dollars In Thousands) (Unaudited)
Quarter Ended
June 30, 2016 March 31, 2016 June 30, 2015
Balance at beginning of period $ 1,061 $ 1,261 $ 1,023
Credit for losses on loan commitments (200)
Balance at end of period $ 1,061 $ 1,061 $ 1,023
Six Months Ended
June 30, 2016 June 30, 2015
Balance at beginning of period $ 1,261 $ 1,023
Credit for losses on loan commitments (200)
Balance at end of period $ 1,061 $ 1,023


WILSHIRE BANCORP, INC. AND SUBSIDIARIES
AVERAGE BALANCES, AVERAGE YIELDS EARNED AND AVERAGE RATES PAID
(Dollars In Thousands) (Unaudited)
For the Quarter Ended
June 30, 2016 March 31, 2016 June 30, 2015
AverageInterest Average AverageInterest Average AverageInterest Average
BalanceIncome/ Yield/ BalanceIncome/ Yield/ BalanceIncome/ Yield/
INTEREST EARNING ASSETS Expense Rate Expense Rate Expense Rate
LOANS:
Real Estate Loans $3,066,405 $35,262 4.60% $3,050,251 $35,025 4.59% $2,767,138 $33,410 4.83%
Commercial Loans 771,109 7,814 4.05% 737,336 7,486 4.06% 709,662 6,947 3.92%
Consumer Loans 9,929 59 2.38% 12,522 86 2.75% 14,413 124 3.44%
Total Gross Loans 3,847,443 43,135 4.49% 3,800,109 42,597 4.48% 3,491,213 40,481 4.64%
Deferred Fees and Costs \ Loan Fees (10,224) 1,138 (10,518) 1,068 (10,032) 1,118
Total Loans * 3,837,219 44,273 4.62% 3,789,591 43,665 4.61% 3,481,181 41,599 4.78%
INVESTMENT SECURITIES AND
OTHER INTEREST-EARNING ASSETS:
Investment Securities** 502,367 2,328 1.98% 529,552 2,460 1.97% 339,876 1,929 2.47%
Deposits Held In Other Institutions 0.00% 0.00% 7,986 32 1.60%
Federal Funds Sold & Others 118,236 149 0.50% 98,313 124 0.50% 368,254 232 0.25%
Total Investment Securities and
Other Earning Assets 620,603 2,477 1.69% 627,865 2,584 1.74% 716,116 2,193 1.32%
TOTAL INTEREST-EARNING ASSETS$4,457,822 $46,750 4.21% $4,417,456 $46,249 4.20% $4,197,297 $43,792 4.19%
Total Non-Interest Earning Assets 284,402 280,877 274,768
TOTAL ASSETS$4,742,224 $4,698,333 $4,472,065
INTEREST BEARING LIABILITIES
INTEREST-BEARING DEPOSITS:
Money Market$ 994,594 $ 1,803 0.73% $1,008,081 $ 1,787 0.71% $ 891,494 $ 1,464 0.66%
NOW 33,996 21 0.25% 37,936 25 0.26% 28,704 20 0.28%
Savings 135,302 520 1.54% 134,064 511 1.53% 129,805 494 1.52%
Time Deposits of $100,000 or More 1,358,446 3,207 0.94% 1,342,858 3,044 0.91% 1,417,860 3,061 0.86%
Other Time Deposits 255,867 609 0.95% 246,197 565 0.92% 276,973 622 0.90%
Total Interest Bearing Deposits 2,778,205 6,160 0.89% 2,769,136 5,932 0.86% 2,744,836 5,661 0.83%
BORROWINGS:
FHLB Advances and Other Borrowings 200,000 907 1.81% 201,209 905 1.80% 112,088 220 0.79%
Junior Subordinated Debentures 72,099 516 2.86% 72,037 503 2.79% 71,858 438 2.44%
Total Borrowings 272,099 1,423 2.09% 273,246 1,408 2.06% 183,946 658 1.43%
TOTAL INTEREST BEARING LIABILITIES$3,050,304 $ 7,583 0.99% $3,042,382 $ 7,340 0.97% $2,928,782 $ 6,319 0.86%
Non-Interest Bearing Deposits 1,088,786 1,064,702 991,167
Other Liabilities 47,783 46,722 38,778
Shareholders’ Equity 555,351 544,527 513,338
TOTAL LIABILITIES AND EQUITY$4,742,224 $4,698,333 $4,472,065
NET INTEREST INCOME $39,167 $38,909 $37,473
.
NET INTEREST SPREAD 3.22% 3.24% 3.33%
NET INTEREST MARGIN 3.53% 3.54% 3.59%
* Allowance for loan losses excluded from average total loans and earning assets
** Tax equivalent ratios for investment securities


WILSHIRE BANCORP, INC. AND SUBSIDIARIES
AVERAGE BALANCES, AVERAGE YIELDS EARNED AND AVERAGE RATES PAID
(Dollars In Thousands) (Unaudited)
For the Six Months Ended
June 30, 2016 June 30, 2015
AverageInterest Average AverageInterest Average
BalanceIncome/ Yield/ BalanceIncome/ Yield/
INTEREST EARNING ASSETS Expense Rate Expense Rate
LOANS:
Real Estate Loans$3,058,328 $ 70,287 4.60% $2,749,883 $ 65,976 4.80%
Commercial Loans 754,223 15,300 4.06% 663,512 13,229 3.99%
Consumer Loans 11,225 146 2.60% 13,780 239 3.47%
Total Gross Loans 3,823,776 85,733 4.48% 3,427,175 79,444 4.64%
Deferred Fees and Costs \ Loan Fees (10,371) 2,205 (10,012) 2,243
Total Loans * 3,813,405 87,938 4.61% 3,417,163 81,687 4.78%
INVESTMENT SECURITIES AND
OTHER INTEREST-EARNING ASSETS:
Investment Securities** 515,959 4,788 1.98% 349,536 3,897 2.42%
Deposits Held In Other Institutions 0.00% 7,993 64 1.60%
Federal Funds Sold & Others 108,275 273 0.50% 312,786 392 0.25%
Total Investment Securities and
Other Earning Assets 624,234 5,061 1.72% 670,315 4,353 1.40%
TOTAL INTEREST-EARNING ASSETS$4,437,639 $ 92,999 4.21% $4,087,478 $ 86,040 4.23%
Total Non-Interest Earning Assets 282,640 276,965
TOTAL ASSETS$4,720,279 $4,364,443
INTEREST BEARING LIABILITIES
INTEREST-BEARING DEPOSITS:
Money Market$1,001,338 $ 3,590 0.72% $ 868,165 $ 2,871 0.66%
NOW 35,966 46 0.26% 28,966 37 0.26%
Savings 134,683 1,031 1.53% 129,523 996 1.54%
Time Deposits of $100,000 or More 1,350,652 6,251 0.93% 1,358,242 5,664 0.83%
Other Time Deposits 251,032 1,174 0.94% 271,331 1,190 0.88%
Total Interest Bearing Deposits 2,773,671 12,092 0.87% 2,656,227 10,758 0.81%
BORROWINGS:
FHLB Advances and Other Borrowings 200,604 1,811 1.81% 131,265 452 0.69%
Junior Subordinated Debentures 72,068 1,020 2.83% 71,828 866 2.41%
Total Borrowings 272,672 2,831 2.08% 203,093 1,318 1.30%
TOTAL INTEREST BEARING LIABILITIES$3,046,343 $ 14,923 0.98% $2,859,320 $ 12,076 0.85%
Non-Interest Bearing Deposits 1,076,744 957,594
Other Liabilities 47,253 40,775
Shareholders’ Equity 549,939 506,754
TOTAL LIABILITIES AND EQUITY$4,720,279 $4,364,443
NET INTEREST INCOME $78,076 $ 73,964
.
NET INTEREST SPREAD 3.23% 3.38%
NET INTEREST MARGIN 3.53% 3.64%
* Allowance for loan losses excluded from average total loans and earning assets
** Tax equivalent ratios for investment securities


RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES:
TANGIBLE COMMON EQUITY AND TANGIBLE ASSETS *
(Dollars In Thousands, Except Share Data) (Unaudited)
Quarter Ended
June 30, 2016 March 31, 2016 June 30, 2015
Total shareholders’ equity$ 560,614 $ 546,248 $ 515,583
Goodwill and other intangible assets, net (70,273) (70,458) (71,141)
Tangible common equity$ 490,341 $ 475,790 $ 444,442
Total assets$4,886,785 $ 4,720,401 $ 4,591,097
Goodwill and other intangible assets, net (70,273) (70,458) (71,141)
Tangible assets$4,816,512 $ 4,649,943 $ 4,519,956
Common shares outstanding 78,891,607 78,845,873 78,495,182


EFFICIENCY RATIO BEFORE GAIN ON SALE OF OREO *
(Dollars In Thousands, Except Share Data) (Unaudited)
Quarter Ended
June 30, 2016
Net interest income$ 39,167
Non-interest income 9,693
Total revenue$ 48,860
Non-interest expenses$ 21,579
Add back – gain on sale of OREO 3,742
Non-interest expense before gain on sale of OREO$ 25,321
Efficiency ratio before gain on sale of OREO 51.8%
(Total revenue / Non-interest expense before gain on sale of OREO)
* Tangible Common Equity, Tangible Assets, and Efficiency Ratio Before Gain on Sale of OREO are non-GAAP financial measures. Management believes that presentation of non-GAAP financial information included in this press release are meaningful and useful in understanding the business metrics of the Company’s operations. We provide non-GAAP financial information for informational purposes and to enhance an understanding of the Company’s GAAP consolidated financial statements. Readers should consider this non-GAAP information in addition to, but not instead or as superior to, the Company’s financial statements in accordance with GAAP. Non-GAAP financial information presented by us may be determined or calculated differently by other companies, limiting the usefulness of non-GAAP measures for comparative purposes

(concluded)

Alex Ko, EVP & CFO, (213) 427-6560 www.wilshirebank.com

Source:Wilshire Bancorp, Inc.

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