Hanmi's Net Interest Margin Reverses to 3.44%

The Tip Desk · November 8, 2026 · 3 min read

Net interest income rose 5.8% to $67.6 million as the margin expanded 8 bps after a second-quarter compression.

Hanmi Financial Corporation (HAFC), the parent of Hanmi Bank, reported net interest income of $67.6 million for the third quarter of 2026, a 5.8% increase from $63.9 million in the second quarter after a 1.0% sequential rise in that prior period. Net income was $23.7 million, or $0.80 a share, compared with $23.5 million, or $0.79 a share, in the second quarter.

The margin turned. Net interest margin (taxable equivalent) expanded eight basis points to 3.44% from 3.36% in the second quarter, reversing a two-basis-point compression in that prior period. The average yield on loans rose 13 basis points to 6.03%, while the average rate on interest-bearing deposits rose only one basis point to 3.18%. Loan-payoff fees, partially offset by interest reversals, represented about five basis points of the loan-yield move. Average interest-earning assets grew 2.4% and average deposits 2.8%.

Interest income included $0.4 million of loan interest reversals, $1.2 million of prepayment fees and accelerated deferred fee income from payoffs, and a $0.2 million special FHLB dividend. Interest expense included an extra $0.3 million on subordinated debentures from overlapping the newly issued 2036 notes with the redemption of 2031 notes. The company said those items represented about four basis points of the margin increase.

Deposits rose 1.4% to $7.06 billion at September 30, with core deposits up 1.9% and noninterest-bearing deposits at 30.4% of the mix. Money market and savings led the increase. Average loans were $6.46 billion. The loan-to-deposit ratio was 93.1%.

Loans held for investment increased 0.5% to $6.57 billion. New production was $543.6 million at an average 6.61% rate; payoffs were $283.5 million at 6.55%. Commercial real estate remained 61.4% of the portfolio. Loans held for sale were $31.2 million, including an $18.0 million problem loan.

Credit loss expense was $4.5 million, compared with $1.2 million in the second quarter, after a $3.2 million charge-off on a $21.2 million commercial real estate loan moved to held-for-sale. Nonperforming assets to total assets were unchanged at 0.12%; nonperforming loans to total loans were 0.14%.

Noninterest income rose 8.2% to $9.0 million, led by a $1.0 million increase in SBA loan-sale gains to $2.3 million and higher interchange fees, partly offset by a $0.5 million drop in bank-owned life insurance income. SBA loans sold were $34.0 million at an 8.10% trade premium. Residential mortgage sales were $13.4 million.

Noninterest expense was $39.8 million, including $1.1 million of accelerated amortization from the 2031 subordinated-debt redemption. The efficiency ratio was 52.02%. Hanmi issued $55.0 million of 2036 notes and used those proceeds plus $44.5 million of securities sales to redeem $110.0 million of 2031 notes.

The company returned 55.6% of third-quarter earnings through $8.3 million of dividends and $4.9 million of share repurchases. Common equity Tier 1 capital was 12.30% and tangible common equity to tangible assets 9.93%. Tangible common equity per share was $27.03.