Hope Bancorp, Inc.

Good day and welcome to the Hope Bancorp 2025 Second Quarter Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Angie Yang, Director of Investor Relations. Please go ahead.

Thank you, Drew. Good morning, everyone, and thank you for joining us for the Hope Bank Corp 2025 Second Quarter Investor Conference Call. As usual, we will be using a slide presentation to accompany our discussion this morning, which is available in the Presentations page of our Investor Relations website. Beginning on slide two, let me start with a brief statement regarding forward looking remarks. The call today contains forward looking projections regarding the future financial performance of the company and future events. Forward looking statements are not guarantees of future performance. Actual outcomes and results may differ materially. Hope Bancorp assumes no obligation to revise any forward looking projections that may be made on today's call. In addition, Some of the information referenced on this call today are non-GAAP financial measures. For a more detailed description of the risk factors and a reconciliation of GAAP to non-GAAP financial measures, please refer to the company's filings with the SEC, as well as the Safe Harbor Statement in our press release issued this morning. Now, we have allotted one hour for this call. Presenting from the management side today will be Kevin Kim, Hope Benkortz, Chairman, President, and CEO, and Juliana Beliska, our Chief Financial Officer. Peter Koh, our Chief Operating Officer, is also here with us as usual and will be available for the Q&A session. With that, let me turn the call over to Kevin Kim. Kevin?

Thank you, Angie. Good morning, everyone, and thank you for joining us today. Let's begin on slide three with a brief overview of the quarter. The second quarter of 2025 was a milestone quarter for Hope Bancorp as we completed the acquisition of Territorial Bancorp, entering the strategically important market of Hawaii. We are excited about the opportunities that this presents. We also repositioned a portion of our legacy securities portfolio to enhance our interest income. Accordingly, we believe Net income excluding notable items is more indicative of our fundamental performance this quarter. Net income for the 2025 second quarter excluding notable items totaled $24.5 million, up 7% from $22.9 million excluding notable items in the preceding first quarter. Earnings per diluted share Excluding notable items were 19 cents for both quarters as we issued 9 million shares with the territorial transaction. As a result of the one-time loss incurred from selling lower yielding legacy securities and from merger related items, together with a one-time impact from a change in California's state tax apportionment law, we reported a net loss of $27.9 million for the second quarter. Pre-tax, pre-provision net revenue, excluding notable items, grew to $41.2 million in the second quarter of 2025, up 17% from $35.2 million in the 2025 first quarter. This reflected the impact of the territorial acquisition, legacy loan growth, improvement in the cost of deposits, and core fee income growth. Moving on to slide four, all our capital ratios remain well above the requirements for well-capitalized financial institutions after the close of the territorial acquisition. Our strong capital levels and ample liquidity provide us a healthy cushion with which to navigate various macroeconomic scenarios and support prudent balance sheet growth. Our Board of Directors declared a quarterly common stock dividend of 14 cents per share payable on August 15th to stockholders of record as of August 1, 2025. Continuing to slide five, strengthening our deposit franchise remains a key priority. At June 30, 2025, our total deposits, with the completion of the territorial acquisition, grew to $15.9 billion, an increase of 10% from the end of the prior quarter. The addition of territorial low-cost deposits drove a substantial improvement in our cost of deposits. In addition, the ongoing maturity and renewal of CDs to lower rates will contribute to the improvement in the cost of funds. Our average cost of interest-bearing deposits declined 37 basis points, quarter-over-quarter, and our average cost of total deposits decreased by 22 basis points, quarter-over-quarter. Similar to past quarters, we continued to reduce our broker deposits exposure, which decreased by $183 million, or 19% quarter-over-quarter. Overall, the broker deposits ratio declined to 5 percent of total deposits at June 30, 2025, down from 7 percent as of March 31, 2025, and 9 percent as of June 30, 2024. Moving on to slide six, at June 30, 2025, loans receivable of $14.4 billion were up 8 percent from the end of the prior quarter, reflecting the addition of territorial loan portfolio, as well as strengthening organic loan production. Organic loan production increased 57 percent from the first quarter levels with a well-diversified mix of originations across all our areas of lending. Stronger production has translated into modest net growth in our legacy portfolio, similar to past quarters, we saw robust net growth from Bank of Hope's residential mortgage team. In addition, commercial real estate loans were up slightly quarter of a quarter. Late in the quarter, we experienced some short-term pay downs in certain commercial lines of credit, and those balances have largely rebuilt immediately after the quarter end. Overall, with the addition of Territorial, our loan portfolio diversification has improved notably. Residential mortgage and other loans represented 16% of our total loans as of June 30, 2025, up from 9% at March 31, 2025. On slides seven and eight, we provide more details on our commercial real estate loans, which are well diversified by property type and granular in size. The loan-to-values remain low, with a weighted average of approximately 46% at June 30, 2025, and the profile of our commercial real estate portfolio has not changed meaningfully. Asset quality remains stable. With that, I will ask Juliana to provide additional details on our financial performance for the second quarter. Juliana?