Improved credit quality and steady loan yields helped Hanmi Financial Corp. (HAFC) post solid earnings in the third quarter.
The $2.8 billion-asset company earned $10.3 million in the third quarter. While thats a 23% decrease from the same period a year ago, the company noted that it received a tax benefit of $644,000 in last year's third quarter. Its earnings per share of 32 cents per share were in line with the estimates of analysts polled by Bloomberg.
Hanmi's net interest income climbed 14%, to $28.5 million, on the strength of solid loan yields and stable costs on deposits. Its net interest margin increased 59 basis points to 4.28%, partly because the company eliminated interest payments on the trust-preferred securities it paid off earlier this year.
The credit performance of Hanmis loan portfolio continued to improve, with net chargeoffs falling 63%, to $2.2 million. The company did not record a loan-loss provision this quarter or in the third quarter of 2012.
Noninterest income rose 12%, to $7.3 million, as Hanmi reaped more revenue from insurance commissions and sales of investment securities. Noninterest expenses inched up 0.9%, to $19 million, as lower legal expenses helped to offset higher compensation costs from new hires.