News Column

Wilshire Bancorp Reports Net Income of $14.7 Million or $0.19 per Share for Second Quarter 2014

July 21, 2014

LOS ANGELES, July 21, 2014 (GLOBE NEWSWIRE) -- Wilshire Bancorp, Inc. (Nasdaq:WIBC) (the "Company"), the holding company for Wilshire Bank (the "Bank"), today reported net income available to common shareholders of $14.7 million, or $0.19 per diluted common share, for the quarter ended June 30, 2014. This compares to net income available to common shareholders of $11.5 million, or $0.16 per diluted common share, for the same period of the prior year, and net income available to common shareholders of $13.1 million, or $0.17 per diluted common share, for the first quarter of 2014.

Jae Whan (J.W.) Yoo, President and CEO of Wilshire Bancorp, said, "We are pleased with our performance in the second quarter, which resulted in a strong level of returns, with our return on average assets totaling 1.62% and our return on average equity totaling 12.77%. With the integration of the BankAsiana and Saehan Bancorp acquisitions complete, we have been able to devote more resources and shift our focus to business development with our larger banking team. As a result, we generated $282 million in loan production in the second quarter, which is a record level for the Company and 45% higher than our loan production in the same period last year. We also continue to see very positive trends in deposit gathering, with solid growth in total deposits and steady improvement in our deposit mix. We have built a great deal of momentum since our acquisitions and we expect to see a continuation of our positive trends in the second half of 2014."

Q2 2014 Summary

Net income available to common shareholders totaled $14.7 million, or $0.19 per diluted common share, for the second quarter of 2014

 
Total revenue of $46.9 million for the second quarter of 2014, an increase of 38% from the second quarter of 2013

 
Return on average assets of 1.62% and return on average equity of 12.77% for the second quarter of 2014

 
Net interest margin of 4.35% for the second quarter of 2014, an increase from 3.97% for the second quarter of 2013

 
Loans receivable (net of deferred fees and costs) totaled $2.97 billion at June 30, 2014, an increase of 42% from $2.09 billion at June 30, 2013

 
Total deposits were $2.96 billion at June 30, 2014, an increase of 35% from $2.18 billion at June 30, 2013

 
Continued low credit losses and improvement in asset quality resulted in no provision for losses on loans and loan commitments for the second quarter of 2014

STATEMENT OF OPERATIONS

Net Interest Income and Margin

Net interest income before provision for losses on loans and loan commitments totaled $36.1 million for the second quarter of 2014, an increase of 40% from $25.8 million for the second quarter of 2013, and an increase of 3% from $35.2 million for the first quarter of 2014. The increase from the prior quarter is primarily attributable to a higher average loan balance and an increase in loan yields.

Net interest margin was 4.35% for the second quarter of 2014, compared to 4.22% for the first quarter of 2014, and 3.97% for the second quarter of 2013. Excluding the effect of the amortization/accretion of the purchase accounting adjustments for the acquisitions for Saehan Bancorp and BankAsiana, the net interest margin was 4.00% for the second quarter of 2014, compared with 3.85% for the first quarter of 2014. The increase in net interest margin is attributable to an increase in average yield on loans, excluding the effects of purchase accounting adjustments, and a more favorable mix of interest-earning assets.

Loan yields were 5.20% for the second quarter of 2014, compared with 5.15% for the first quarter of 2014, and 4.97% for the second quarter of 2013. Excluding the effect of the accretion of the purchase accounting adjustments for Saehan Bancorp and BankAsiana, loan yields were 4.85% for the second quarter of 2014, compared to 4.77% for the first quarter of 2014.

The total cost of deposits was 0.48% for the second quarter of 2014, compared with 0.51% for both the first quarter of 2014 and the second quarter of 2013.

Non-Interest Income

Total non-interest income was $10.7 million for the second quarter of 2014, compared to $8.3 million for the second quarter of 2013, and $11.0 million for the first quarter of 2014. The decrease from the prior quarter was primarily due to a lower level of income on servicing assets, which was partially offset by a higher net gain on sale of Small Business Administration ("SBA") loans.

The $4.7 million in net gain on sale of loans recognized during the second quarter of 2014 consisted substantially of gains from the sale of SBA loans. Net gain on sale of loans for the first quarter of 2014 was $4.3 million. During the second quarter of 2014, the Company sold $45.3 million in SBA loans, compared with $43.5 million sold during the first quarter of 2014.

Non-Interest Expense

Total non-interest expense was $24.6 million for the second quarter of 2014, compared with $17.1 million for the second quarter of 2013, and $26.3 million for the first quarter of 2014. Excluding merger-related expenses, the increase in non-interest expense from the prior quarter was attributable to an impairment charge to the Company's FDIC indemnification asset, an increase in losses on low income housing tax credit investments, and an increase in OREO provisions. Merger related costs for the second quarter of 2014 totaled $213,000, compared to $3.4 million for the first quarter of 2014.

The Company's loss share agreement with the FDIC relating to covered loans acquired from Mirae Bank expired on June 30, 2014. The remaining FDIC indemnification asset, less reimbursements to be received, was written off as an impairment to the asset. The impairment charge to the Company's FDIC indemnification asset reflects a lower level of losses than expected on covered loans acquired from Mirae Bank.

Total salaries and employee benefits expense was $12.5 million for the second quarter of 2014, compared with $9.5 million for the second quarter of 2013, and $12.7 million for the first quarter of 2014.

Other non-interest expense for the second quarter of 2014 totaled $7.1 million, compared with $4.9 million in the second quarter of 2013, and $6.0 million for the first quarter of 2014. The increase from the prior quarter was primarily attributable to a $490,000 increase in losses on low income housing tax credit investments and a $246,000 increase in provision for OREO.

The Company's operating efficiency ratio was 52.4% for the second quarter of 2014, compared with 50.1% for the second quarter of 2013 and 56.9% for the first quarter of 2014.

BALANCE SHEET

Total gross loans receivable (not including deferred fees and costs) were $2.98 billion at June 30, 2014, compared to $2.88 billion at March 31, 2014. The increase in loans during the second quarter of 2014 was primarily attributable to growth in the commercial real estate and commercial and industrial portfolios.

The following table shows gross loans receivable and gross loans by loan type: 

  Quarter Ended
(Dollars In Thousands) (Unaudited)June 30, 2014  March 31, 2014  December 31, 2013  September 30, 2013  June 30, 2013
Construction $ 44,598   $ 43,277   $ 40,367   $ 32,119   $ 36,371
Real Estate Secured 2,485,875   2,401,203   2,332,121   1,819,052   1,715,567
Commercial & Industrial 435,693   419,313   437,524   342,057   337,057
Consumer 13,075   16,100   14,694   9,637   11,089
 Gross Loans Receivable * 2,979,241   2,879,893   2,824,706   2,202,865   2,100,084
 Held-For-Sale Loans 6,207   27,791   47,557   56,065   60,910
 Total Gross Loans * $ 2,985,448   $ 2,907,684   $ 2,872,263   $ 2,258,930   $ 2,160,994
                   
 * Gross loans receivable and total gross loans are not net of deferred fees and costs as shown in the consolidated balance sheet presentation                  


The following table presents the June 30, 2014 balance of gross loans by loan type and broken out by legacy Wilshire loans, and loans acquired from former Mirae Bank, BankAsiana, and Saehan Bancorp

  At June 30, 2014
(Dollars In Thousands) (Unaudited) BankAsiana*   Saehan Bancorp*   Mirae Bank*   Legacy Wilshire   Total
Construction $ 3,755   $ --   $ --   $ 40,843   $ 44,598
Real Estate Secured 109,780   330,117   57,243   1,988,735   2,485,875
Commercial & Industrial 28,266   27,239   3,174   377,014   435,693
Consumer 3   929   2   12,141   13,075
 Gross Loans Receivable 141,804   358,285   60,419   2,418,733   2,979,241
 Held-For-Sale Loans 384   --   --   5,823   6,207
 Total Gross Loans $ 142,188   $ 358,285   $ 60,419   $ 2,424,556   $ 2,985,448
                   
  * Represents loans balances net of fair value adjustment          


The following table shows quarterly loan originations by loan type: 

  Quarter Ended  
(Dollars In Thousands) (Unaudited)June 30, 2014  March 31, 2014  December 31, 2013  September 30, 2013June 30, 2013 
Real Estate Secured $ 170,042   60%   $ 96,266   49%   $ 132,780   60%   $ 145,361   68%   $ 93,606   48%  
Commercial & Industrial 31,058   11%   36,619   18%   30,541   14%   23,710   11%   40,927   21%  
Consumer 1,580   1%   632   0%   546   0%   540   0%   75   0%  
SBA 37,004   13%   35,305   18%   44,599   20%   36,001   17%   40,209   21%  
Residential Mortgage 42,325   15%   29,063   15%   13,858   6%   8,714   4%   20,022   10%  
 Total Loan Originations $ 282,009   100%   $ 197,885   100%   $ 222,324   100%   $ 214,326   100%   $ 194,839   100%  


Originations for the second quarter of 2014 totaled $282.0 million, compared to $197.9 million for the first quarter of 2014, and $194.8 million for the second quarter of 2013.  The increase from the previous quarter was primarily due to higher real estate secured and residential mortgage loan production.

Total SBA loans held-for-sale at the end of the second quarter of 2014 were $5.1 million, compared to $26.8 million at the end of the previous quarter.  The decision to retain or sell SBA loans is made on a quarter-to-quarter basis, depending on prevailing pricing in the secondary market and the Company's liquidity needs. 

Total deposits were $2.96 billion at June 30, 2014, compared with $2.92 billion at March 31, 2014. The increase in total deposits was primarily attributable to growth in non-interest bearing demand deposits, which was partially offset by a decline in money market deposits. 

CREDIT QUALITY

The Company experienced a decline across most problem loan categories and a low level of credit losses during the second quarter of 2014. The Company determined that no provision for losses on loans and loan commitments was required for the second quarter of 2014.   The allowance for loan losses totaled $52.7 million, or 1.77% of gross loans (excluding loans held-for-sale), at June 30, 2014, compared to $53.5 million, or 1.86% of gross loans (excluding loans held-for-sale), at March 31, 2014.  Acquired loans, included in the allowance coverage ratios, were recorded at fair value and the remaining discount on these loans approximated $27.9 million at June 30, 2014. The coverage ratio of the allowance for loan losses to non-performing assets was 107.41% at June 30, 2014, compared with 102.66% at March 31, 2014.

Non-Performing Loans

At June 30, 2014, total non-performing loans were $42.4 million, or 1.42% of total gross loans, compared to $43.1 million, or 1.48% of total gross loans, at March 31, 2014. 

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

NON-PERFORMING LOANS Quarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2014  Mar 31, 2014  Dec 31, 2013  Sep 30, 2013  Jun 30, 2013
(Net of SBA Guaranty Portions)                  
Construction $ --   $ --   $ 2,471   $ 2,471   $ 5,467
Real Estate Secured 35,585   35,988   33,569   29,568   20,090
Commercial & Industrial 6,769   7,121   1,196   1,004   1,224
Consumer 4   --   --   --   --
 Total Non-Performing Loans $ 42,358   $ 43,109   $ 37,236   $ 33,043   $ 26,781


Net Charge-offs/Recoveries

During the second quarter of 2014, the Company had total gross charge-offs of $1.8 million and recoveries of $1.0 million for net charge-offs of $795,000.

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

GROSS LOAN CHARGE-OFFS Quarter Ended  
(Dollars In Thousands) (Unaudited)Jun 30, 2014  Mar 31, 2014  Dec 31, 2013  Sep 30, 2013  Jun 30, 2013
                   
Real Estate Secured $ 782   $ 672   $ 552   $ 2,438   $ 3,668
Commercial & Industrial 1,021   964   997   764   746
Consumer --   1   2   --   --
Total Loan Charge-Offs $ 1,803   $ 1,637   $ 1,551   $ 3,202   $ 4,414

 

LOAN RECOVERIES Quarter Ended  
(Dollars In Thousands) (Unaudited)Jun 30, 2014  Mar 31, 2014  Dec 31, 2013  Sep 30, 2013  Jun 30, 2013
                   
Real Estate Secured $ 586   $ 1,028   $ 2,038   $ 148   $ 340
Commercial & Industrial 408   510   679   510   433
Consumer 14   --   --   4   1
Total Loan Recoveries $ 1,008   $ 1,538   $ 2,717   $ 662   $ 774


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, 2014  Mar 31, 2014  Dec 31, 2013  Sep 30, 2013  Jun 30, 2013
(Net of SBA Guaranty Portions)                  
30 - 59 Days Past Due $ 4,556   $ 5,756   $ 2,846   $ 2,336   $ 4,993
60 - 89 Days Past Due 2,992   1,526   2,527   2,827   3,637
90 Days, and still accruing --   --   167   --   126
Total Delinquent Loans $ 7,548   $ 7,282   $ 5,540   $ 5,163   $ 8,756

 

TROUBLED DEBT RESTRUCTURED LOANS Quarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2014  Mar 31, 2014  Dec 31, 2013  Sep 30, 2013  Jun 30, 2013  
(Net of SBA Guaranty Portions)                    
Real Estate Secured $ 33,349   $ 34,565   $ 30,008   $ 23,133   $ 23,671  
Commercial & Industrial 5,542   5,563   6,212   6,339   6,730  
Total TDR Loans $ 38,891   $ 40,128   $ 36,220   $ 29,472   $ 30,401  

 

LOAN CLASSIFICATIONS Quarter Ended
(Dollars In Thousands) (Unaudited)Jun 30, 2014  Mar 31, 2014  Dec 31, 2013  Sep 30, 2013  Jun 30, 2013
(Net of SBA Guaranty Portions)                  
Special Mention $ 88,382   $ 101,627   $ 100,798   $ 43,519   $ 49,571
Substandard 110,462   127,996   149,479   127,855   138,319
Doubtful 18,040   19,931   8,015   7,174   6,722
Total Criticized and Classified Loans $ 216,884   $ 249,554   $ 258,292   $ 178,548   $ 194,612
                   
Classified Loans $ 128,502   $ 147,927   $ 157,494   $ 135,029   $ 145,041


CAPITAL RATIOS

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, 2014 
  Well Capitalized

Regulatory

Requirements
  Total Excess Above

Well Capitalized

Requirements
           
Tier 1 Leverage Capital Ratio 12.89%   5.00%   $ 279,225
Tier 1 Risk-Based Capital Ratio 15.05%   6.00%   $ 274,263
Total Risk-Based Capital Ratio 16.31%   10.00%   $ 191,121
Tangible Common Equity To Tangible Assets * 10.88%   N/A   N/A
Tangible Common Equity Per Common Share * $ 5.02   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 22, 2014, at 11:00 a.m. PT (2:00 p.m. ET). Investment professionals are invited to participate in the call by dialing 877-415-3185 (domestic) or 857-244-7328 (international) and providing passcode number 69604633.

ABOUT WILSHIRE BANCORP

Headquartered in Los Angeles, Wilshire Bancorp is the parent company of Wilshire Bank, which operates 35branch offices in California, Texas, New Jersey and New York, and 7 loan production offices in Dallas, TX, Atlanta, GA, Aurora, CO, Annandale, VA, Palisades Park, NJ, Newark, CA, and New York, NY, and is an SBA preferred lender nationwide. Wilshire Bank is a community bank with a focus on commercial real estate lending and general commercial banking, with its primary market encompassing the multi-ethnic populations of the Los Angeles Metropolitan area. For more information, please go to www.wilshirebank.com.

FORWARD-LOOKING STATEMENTS

Statements concerning future performance, events, or any other guidance on future periods constitute forward-looking statements that are subject to a number of risks and uncertainties that might cause actual results to differ materially from stated expectations. Undue reliance should not be placed on forward-looking statements, as they are subject to risks and uncertainties, including but not limited to the risk factors set forth in our most recent Annual Report on Form 10-K and our other filings made from time to time with the Securities and Exchange Commission. Specific factors that could cause future results to differ materially from historical performance and these forward-looking statements include, but are not limited to: (1) loan production and sales, (2) credit quality, (3) the ability to expand net interest margin, (4) the ability to continue to attract low-cost deposits, (5) success of expansion efforts, (6) competition in the marketplace, (7) political developments, war or other hostilities, (8) changes in the interest rate environment, (9) the ability of our borrowers to repay their loans, (10) the ability to maintain capital requirements and adequate sources of liquidity, (11) effects of or changes in accounting policies, (12) legislative or regulatory changes or actions, (13) the ability to attract and retain key personnel, (14) the ability to receive dividends from our subsidiaries, (15) the ability to secure confidential information through the use of computer systems and telecommunications networks, (16) weakening in the economy, specifically the real estate market, either nationally or in the states in which we do business, (17) the integration of our acquired businesses, and (18) general economic conditions. The information in this press release speaks only as of the date of this release and Wilshire Bancorp specifically disclaims any duty to update the information in this press release. Additional information on these and other factors that could affect financial results are included in filings by Wilshire Bancorp with the Securities and Exchange Commission.

 

CONSOLIDATED BALANCE SHEET            
(Dollars In Thousands) (Unaudited)  June 30,  March 31,   Three Months  June 30,   Twelve Months
    2014   2014   % Change   2013   % Change
ASSETS:                    
Cash and due from banks   $  155,799   $  160,999   -3%    $ 162,553   -4%
Federal funds sold and other cash equivalents   927   7,301   -87%   55,005   -98%
Total Cash and Cash Equivalents   156,726   168,300   -7%   217,558   -28%
                     
Deposits held in other financial institutions   20,509   21,006   -2%   --   0%
                     
Investment securities available for sale   327,239   342,438   -4%   303,836   8%
Investment securities held to maturity   30   32   -6%   42   -29%
Total Investment Securities   327,269   342,470   -4%   303,878   8%
                     
Total Loans Held-For-Sale   6,207   27,791   -78%   60,910   -90%
                     
 Real estate construction   43,292   42,124   3%   35,513   22%
 Residential real estate   167,055   169,810   -2%   153,393   9%
 Commercial real estate   2,314,746   2,225,677   4%   1,557,922   49%
 Commercial and industrial   431,758   417,956   3%   336,048   28%
 Consumer   13,044   16,072   -19%   11,068   18%
Total loans receivable, net of deferred fees and costs   2,969,895   2,871,639   3%   2,093,944   42%
Allowance for loan losses   (52,669)   (53,464)   -1%   (54,937)   -4%
Loans Receivable, Net of Allowance for Loan Losses   2,917,226   2,818,175   4%   2,039,007   43%
                     
Accrued interest receivable   8,032   8,293   -3%   7,135   13%
Due from customers on acceptances   3,090   889   248%   293   955%
Other real estate owned   6,676   8,969   -26%   982   580%
Premises and equipment   12,925   13,313   -3%   11,699   10%
Federal home loan bank (FHLB) stock, at cost   16,989   15,983   6%   13,280   28%
Cash surrender value of life insurance   22,803   22,661   1%   22,225   3%
Investment in affordable housing partnerships   41,112   42,459   -3%   45,511   -10%
Deferred income taxes   32,459   34,391   -6%   17,734   83%
Servicing assets   18,168   17,536   4%   11,040   65%
Goodwill   67,528   67,528   0%   6,675   912%
FDIC indemnification asset   267   2,169   -88%   5,311   -95%
Other assets   23,275    22,533   3%    24,163   -4%
TOTAL ASSETS    $  3,681,261    $ 3,634,466   1%    $ 2,787,401   32%
                     
LIABILITIES AND SHAREHOLDERS' EQUITY:                    
LIABILITIES:                    
Non-interest bearing demand deposits   $ 945,010   $ 869,598   9%   $ 624,770   51%
Savings and interest checking   160,155   156,587   2%   130,352   23%
Money market deposits   758,833   799,299   -5%   625,204   21%
Time deposits in denomination of $100,000 or more   856,681   860,697   0%   584,140   47%
Other time deposits   235,335   237,028   -1%   217,832   8%
Total Deposits   2,956,014   2,923,209   1%   2,182,298   35%
                     
FHLB borrowings   150,260   150,292   0%   150,000   0%
Acceptance outstanding   3,090   889   248%   293   955%
Junior subordinated debentures   71,665   71,610   0%   61,857   16%
Accrued interest payable   2,349   2,462   -5%   2,072   13%
Other liabilities    33,114   34,429   -4%   35,547   -7%
Total Liabilities   3,216,492   3,182,891   1%   2,432,067   32%
                     
SHAREHOLDERS' EQUITY:                    
Common stock   231,368   230,979   0%   160,932   44%
Retained earnings   229,556   218,806   5%   191,823   20%
Accumulated other comprehensive income   3,845   1,790   115%   2,579   49%
Total Shareholders' Equity   464,769   451,575   3%   355,334   31%
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY    $ 3,681,261    $ 3,634,466   1%    $ 2,787,401   32%

 

CONSOLIDATED STATEMENT OF OPERATIONS                  
(Dollars In Thousands, Except Per Share Data) (Unaudited)                  
    Quarter Ended   Three Mths   Quarter Ended      Twelve Mths
   June 30, 2014  March 31, 2014   % Change  June 30, 2013   % Change
                  
INTEREST INCOME                    
Interest and fees on loans   $ 37,993   $ 37,101   2%   $ 26,970   41%
Interest on investment securities   2,023   2,101   -4%   1,743   16%
Interest on federal funds sold and others   92   151   -39%   136   -32%
Total Interest Income   40,108   39,353   2%   28,849   39%
                     
INTEREST EXPENSE                    
Deposits   3,486   3,676   -5%   2,750   27%
FHLB advances and other borrowings   493   504   -2%   345   43%
Total Interest Expense   3,979   4,180   -5%   3,095   29%
                     
Net interest income before provision for losses on loans and loan commitments   36,129   35,173   3%   25,754   40%
Provision for losses on loans and loan commitments   --   --   0%   --   0%
                     
Net interest income after provision for losses on loans and loan commitments   36,129   35,173   3%   25,754   40%
                     
NONINTEREST INCOME                    
 Service charges on deposits   3,174   3,146   1%   2,811   13%
 Gain on sales of loans, net   4,687   4,329   8%   3,135   50%
 Gain on sale/call of investment securities   --   --   0%   15   -100%
 Other   2,883   3,511   -18%   2,371   22%
 Total Noninterest Income   10,744   10,986   -2%   8,332   29%
                     
NONINTEREST EXPENSES                    
 Salaries and employee benefits   12,449   12,655   -2%   9,548   30%
 FDIC indemnification impairment   597   --   0%   --   0%
 Occupancy and  equipment   3,444   3,309   4%   2,038   69%
 Data processing   795   963   -17%   583   36%
 Merger related costs   213   3,364   -94%   --   0%
 Other   7,052   5,966   18%   4,913   44%
Total Noninterest Expenses   24,550   26,257   -7%   17,082   44%
                     
 Income before income taxes   22,323   19,902   12%   17,004   31%
 Income taxes provision   7,659   6,789   13%   5,465   40%
NET INCOME   $ 14,664   $ 13,113   12%   $ 11,539   27%
                     
PER COMMON SHARE INFORMATION:                    
 Basic income per common share   $ 0.19   $ 0.17   12%   $ 0.16   15%
 Diluted income per common share   $ 0.19   $ 0.17   12%   $ 0.16   15%
                     
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING:                    
 Basic   78,267,128   78,115,779       70,944,626    
 Diluted   78,613,468   78,496,106       71,101,787    

 

CONSOLIDATED STATEMENT OF OPERATIONS        
(Dollars In Thousands, Except Per Share Data) (Unaudited)          
  Six Months Ended   Twelve Months
   June 30, 2014  June 30, 2013   % Change  
             
INTEREST INCOME              
Interest and fees on loans   $ 75,094   $ 53,855   39%  
Interest on investment securities   4,124   3,468   19%  
Interest on federal funds sold   243   289   -16%  
Total Interest Income   79,461   57,612   38%  
               
INTEREST EXPENSE              
Deposits   7,162   5,599   28%  
FHLB advances and other borrowings   997   707   41%  
Total Interest Expense   8,159   6,306   29%  
               
Net interest income before provision for losses on loans and loan commitments   71,302   51,306   39%  
Provision for losses on loans and loan commitments   --   --   0%  
               
Net interest income after provision for losses on loans and loan commitments   71,302   51,306   39%  
               
NONINTEREST INCOME              
Service charges on deposits   6,320   5,619   12%  
Gain on sales of loans, net   9,016   6,621   36%  
Gain on sale/call of investment securities   --   15   -100%  
Other   6,394   4,782   34%  
Total Noninterest Income   21,730   17,037   28%  
               
NONINTEREST EXPENSES              
Salaries and employee benefits   25,104   18,353   37%  
FDIC indemnification impairment   597   --   0%  
Occupancy and equipment   6,753   4,078   66%  
Data processing   1,758   1,258   40%  
Merger related costs   3,577   --   0%  
Other   13,018   10,677   22%  
Total Noninterest Expenses   50,807   34,366   48%  
               
Income before income taxes   42,225   33,977   24%  
Income taxes provision   14,448   10,849   33%  
NET INCOME   $ 27,777   $ 23,128   20%  
               
PER COMMON SHARE INFORMATION:              
Basic income per common share   $ 0.36   $ 0.33   9%  
Diluted income per common share   $ 0.35   $ 0.32   9%  
               
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING:              
Basic   78,191,872   71,119,180      
Diluted   78,554,947   71,262,224      
                         
SUMMARY OF FINANCIAL DATA                         
(Dollars In Thousands, Except Per Share Data) (Unaudited)                        
                         
    Quarter Ended    
AVERAGE BALANCES  June 30, 2014      March 31, 2014      June 30, 2013    
Average Assets  $ 3,614,014      $ 3,631,268      $ 2,770,996    
Average Equity   459,423       447,188       356,287    
Average Net Loans    2,923,225       2,881,650       2,172,473    
Average Deposits   2,896,815       2,878,950       2,170,628    
Average Time Deposits of $100,000 or more   865,110       874,039       586,136    
Average FHLB & Other Borrowings   150,280       193,413       150,000    
 Average Interest Earning Assets   3,337,010       3,346,954       2,613,813    
                         
    Six Months Ended    
AVERAGE BALANCES  June 30, 2014              June 30, 2013    
Average Assets  $ 3,619,793              $ 2,747,399    
Average Equity   453,495               352,202    
Average Net Loans    2,901,713               2,149,832    
Average Deposits   2,885,642               2,153,134    
Average Time Deposits of $100,000 or more   868,318               583,688    
Average FHLB & Other Borrowings   171,727               150,022    
Average Interest Earning Assets   3,341,003               2,597,226    
                         
    Quarter Ended    
PROFITABILITY  June 30, 2014      March 31, 2014      June 30, 2013    
Annualized Return on Average Assets   1.62%       1.44%       1.67%    
Annualized Return on Average Equity   12.77%       11.73%       12.95%    
Efficiency Ratio   52.38%       56.88%       50.11%    
Annualized Operating Expense/Average Assets   2.72%       2.89%       2.47%    
Annualized Net Interest Margin   4.35%       4.22%       3.97%    
                         
    Six Months Ended    
PROFITABILITY  June 30, 2014              June 30, 2013    
Annualized Return on Average Assets   1.53%               1.68%    
Annualized Return on Average Equity   12.25%               13.13%    
Efficiency Ratio   54.61%               50.28%    
Annualized Operating Expense/Average Assets   2.81%               2.50%    
Annualized Net Interest Margin   4.29%               3.98%    
                         
                         
DEPOSIT COMPOSITION   

June 30, 2014
  Cost of

Funds
 

March 31, 2014
  Cost of

Funds
 

June 30, 2013
  Cost of

Funds
Noninterest Bearing Demand Deposits   32.00%   0.00%   29.70%   0.00%   28.60%   0.00%
Savings & Interest Checking   5.40%   1.19%   5.40%   1.28%   6.00%   1.43%
Money Market Deposits   25.70%   0.66%   27.30%   0.66%   28.60%   0.63%
Time Deposits of $100,000 or More   29.00%   0.60%   29.40%   0.68%   26.80%   0.60%
Other Time Deposits   8.00%   0.77%   8.10%   0.67%   10.00%   0.78%
 Total Deposits   100.00%   0.48%   100.00%   0.51%   100.00%   0.51%
                         
CAPITAL RATIOS  June 30, 2014      March 31, 2014      June 30, 2013    
Tier 1 Leverage Ratio   12.89%       12.50%       14.67%    
Tier 1 Risk-Based Capital Ratio   15.05%       14.92%       18.73%    
Total Risk-Based Capital Ratio   16.31%       16.17%       20.00%    
Total Shareholders' Equity  $ 464,769      $ 451,575      $ 355,334    
Book Value Per Common Share  $5.94      $5.77      $5.03    
Tangible Common Equity Per Common Share *  $5.02      $4.84      $4.92    
Tangible Common Equity to Tangible Assets **   10.88%       10.64%       12.51%    
* Tangible common equity excludes goodwill, other intangible assets
** Tangible assets excludes goodwill and intangible assets

 

ALLOWANCE FOR LOAN LOSSES  
(Dollars In Thousands) (Unaudited)      
    Quarter Ended
   June 30, 2014  March 31, 2014  December 31, 2013  September 30, 2013  June 30, 2013  
                       
Balance at Beginning of Period   $ 53,464   $ 53,563   $ 52,397   $ 54,937   $ 58,577  
Provision for Losses on Loans   --   --   --   --   --  
Recoveries on Loans Previously Charged-off   1,008   1,538   2,717   662   774  
Gross Loan Charge-offs   (1,803)   (1,637)   (1,551)   (3,202)   (4,414)  
Balance at End of Period   $ 52,669   $ 53,464   $ 53,563   $ 52,397   $ 54,937  
                       
Net Loan Charge-offs/Average Net Loans   0.03%   0.00%   -0.04%   0.12%   0.17%  
Charge-offs/Average Total Loans   0.06%   0.06%   0.06%   0.15%   0.21%  
Allowance for Loan Losses/Gross Loans*   1.77%   1.86%   1.90%   2.38%   2.62%  
Allowance for Loan Losses/Non-accrual Loans   124.34%   124.02%   144.50%   158.57%   206.10%  
Allowance for Loan Losses/Non-performing Loans   124.34%   124.02%   143.85%   158.57%   205.13%  
Allowance for Loan Losses/Non-performing Assets   107.41%   102.66%   119.46%   155.06%   197.88%  
Allowance for Loan Losses/Classified Loans   34.01%   34.01%   34.01%   38.80%   37.88%  
                       
* Excluding held-for-sale loans                      
                       
NON-PERFORMING ASSETS  
(Dollars In Thousands, Net of SBA Guaranty)   Quarter Ended  
(Unaudited)  June 30, 2014  March 31, 2014  December 31, 2013  September 30, 2013  June 30, 2013  
                       
Non-accrual Loans   $ 42,358   $ 43,109   $ 37,068   $ 33,043   $ 26,655  
Loans 90 days or more past due and still accruing   --   --   168   --   126  
Total Non-performing Loans   42,358   43,109   37,236   33,043   26,781  
                       
Total OREO   6,676   8,969   7,600   748   982  
                       
Total Non-performing Assets   $ 49,034   $ 52,078   $ 44,836   $ 33,791   $ 27,763  
                       
Total Non-performing Loans/Gross Loans   1.42%   1.48%   1.30%   1.46%   1.24%  
Total Non-performing Assets/Total Assets   1.33%   1.43%   1.24%   1.19%   1.00%  
                       
ALLOWANCE FOR OFF-BALANCE SHEET ITEMS             
(Dollars In Thousands) (Unaudited)   Quarter Ended
   June 30, 2014  March 31, 2014  June 30, 2013
             
Balance at beginning of period  $ 1,061  $ 1,061  $ 1,023
Credit for losses on off-balance sheet items   --   --   --
Balance at end of period  $ 1,061  $ 1,061  $ 1,023
             
             
    Six Months Ended    
   June 30, 2014  June 30, 2013    
             
Balance at beginning of period  $ 1,061  $ 1,023    
Credit for losses on off-balance sheet items   --   --    
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, 2014 March 31, 2014 June 30, 2013
 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 $ 2,497,372 $ 31,753   5.09%   $ 2,447,610 $ 31,008   5.07%   $ 1,815,010 $ 22,074   4.87%
Commercial Loans 421,163 5,120   4.86%   430,076 4,919   4.58%   351,460 4,061   4.62%
Consumer Loans 13,426 133   3.96%   11,873 118   3.98%   11,299 75   2.66%
Total Gross Loans 2,931,961 37,006   5.05%   2,889,559 36,045   4.99%   2,177,769 26,210   4.81%
Deferred Fees and Costs \ Loan Fees (8,736) 987       (7,909) 1,056       (5,296) 760    
Total Loans * 2,923,225 37,993   5.20%   2,881,650 37,101   5.15%   2,172,473 26,970   4.97%
                             
INVESTMENT SECURITIES AND                            
OTHER INTEREST-EARNING ASSETS:                            
Investment Securities** 338,060 2,023   2.60%   349,701 2,101   2.60%   323,502 1,743   2.39%
Deposits Held In Other Institutions 20,539 70   1.36%   21,019 69   1.31%   -- --   0.00%
Federal Funds Sold & Others 55,186 22   0.16%   94,584 82   0.35%   117,838 136   0.46%
Total Investment Securities and                            
 Other Earning Assets 413,785 2,115   2.21%   465,304 2,252   2.09%   441,340 1,879   1.87%
                             
TOTAL INTEREST-EARNING ASSETS $ 3,337,010 $ 40,108   4.83%   $ 3,346,954 $ 39,353   4.72%   $ 2,613,813 $ 28,849   4.44%
                             
Total Non-Interest Earning Assets 277,004         284,314         157,183      
TOTAL ASSETS $ 3,614,014         $ 3,631,268         $ 2,770,996      
                             
INTEREST BEARING LIABILITIES                            
                             
INTEREST-BEARING DEPOSITS:                            
Money Market $ 770,512 $ 1,276   0.66%   $ 784,219 $ 1,301   0.66%   $ 617,837 $ 971   0.63%
NOW 34,812 16   0.18%   32,019 15   0.19%   27,915 14   0.20%
Savings 120,274 445   1.48%   120,908 476   1.58%   101,263 447   1.77%
Time Deposits of $100,000 or More 865,110 1,296   0.60%   874,039 1,485   0.68%   586,136 884   0.60%
Other Time Deposits 235,907 453   0.77%   236,826 399   0.67%   223,256 434   0.78%
Total Interest Bearing Deposits 2,026,615 3,486   0.69%   2,048,011 3,676   0.72%   1,556,407 2,750   0.71%
                             
BORROWINGS:                            
FHLB Advances and Other Borrowings 150,280 67   0.18%   193,413 74   0.15%   150,000 64   0.17%
Junior Subordinated Debentures 71,631 426   2.38%   71,573 430   2.40%   61,857 281   1.82%
Total Borrowings 221,911 493   0.89%   264,986 504   0.76%   211,857 345   0.65%
                             
TOTAL INTEREST BEARING LIABILITIES $ 2,248,526 $ 3,979   0.71%   $ 2,312,997 $ 4,180   0.72%   $ 1,768,264 $ 3,095   0.70%
                             
 Non-Interest Bearing Deposits 870,200         830,939         614,221      
 Other Liabilities 35,865         40,144         32,224      
 Shareholders' Equity 459,423         447,188         356,287      
TOTAL LIABILITIES AND EQUITY $ 3,614,014         $ 3,631,268         $ 2,770,996      
                             
NET INTEREST INCOME   $ 36,129         $ 35,173         $ 25,754    
.                            
NET INTEREST SPREAD       4.12%         4.00%         3.74%
                             
NET INTEREST MARGIN       4.35%         4.22%         3.97%
 * 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, 2014 June 30, 2013
 AverageInterest Average AverageInterest Average
 BalanceIncome/ Yield/ BalanceIncome/ Yield/
 INTEREST EARNING ASSETS   Expense   Rate    Expense  Rate
                   
LOANS:                  
Real Estate Loans $ 2,472,184 $ 62,762   5.08%   $ 1,795,056 $ 44,176   4.92%
Commercial Loans 425,284 10,039   4.72%   347,752 8,024   4.62%
Consumer Loans 12,567 250   3.98%   12,059 155   2.57%
Total Gross Loans 2,910,035 73,051   5.02%   2,154,867 52,355   4.86%
Deferred Fees and Costs \ Loan Fees (8,322) 2,043       (5,035) 1,500    
Total Loans * 2,901,713 75,094   5.18%   2,149,832 53,855   5.01%
                   
INVESTMENT SECURITIES AND                  
OTHER INTEREST-EARNING ASSETS:                  
Investment Securities** 343,764 4,124   2.60%   323,879 3,468   2.38%
Deposits Held In Other Institutions 20,776 139   1.34%   -- --   0.00%
Federal Funds Sold & Others 74,750 104   0.28%   123,515 289   0.47%
Total Investment Securities and                  
 Other Earning Assets 439,290 4,367   2.15%   447,394 3,757   1.85%
                   
TOTAL INTEREST-EARNING ASSETS $ 3,341,003 $ 79,461   4.78%   $ 2,597,226 $ 57,612   4.47%
                   
Total Non-Interest Earning Assets 278,790         150,173      
TOTAL ASSETS $ 3,619,793         $ 2,747,399      
                   
INTEREST BEARING LIABILITIES                  
                   
INTEREST-BEARING DEPOSITS:                  
Money Market $ 778,796 $ 2,577   0.66%   $ 620,639 $ 1,947   0.63%
NOW 33,454 31   0.19%   26,941 26   0.19%
Savings 117,543 921   1.57%   100,914 912   1.81%
Time Deposits of $100,000 or More 868,318 2,781   0.64%   583,688 1,808   0.62%
Other Time Deposits 238,445 852   0.72%   229,524 906   0.79%
Total Interest Bearing Deposits 2,036,556 7,162   0.70%   1,561,706 5,599   0.72%
                   
BORROWINGS:                  
FHLB Advances and Other Borrowings 171,727 141   0.16%   150,022 143   0.19%
Junior Subordinated Debentures 71,602 856   2.39%   61,857 564   1.82%
Total Borrowings 243,329 997   0.82%   211,879 707   0.67%
                   
TOTAL INTEREST BEARING LIABILITIES $ 2,279,885 $ 8,159   0.72%   $ 1,773,585 $ 6,306   0.71%
                   
 Non-Interest Bearing Deposits 849,086         591,428      
 Other Liabilities 37,327         30,184      
 Shareholders' Equity 453,495         352,202      
TOTAL LIABILITIES AND EQUITY $ 3,619,793         $ 2,747,399      
                   
NET INTEREST INCOME   $ 71,302         $ 51,306    
.                  
NET INTEREST SPREAD       4.06%         3.76%
                   
NET INTEREST MARGIN       4.29%         3.98%
 * 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, 2014  March 31, 2014  June 30, 2013  
             
Total shareholders' equity $ 464,769   $ 451,575   $ 355,334  
 Goodwill and other intangible assets, net (72,206)   (72,480)   (7,572)  
Tangible common equity $ 392,563   $ 379,095   $ 347,762  
             
Total assets $ 3,681,261   $ 3,634,466   $ 2,787,401  
 Goodwill and other intangible assets, net (72,206)   (72,480)   (7,572)  
Tangible assets $ 3,609,055   $ 3,561,986   $ 2,779,829  
             
Common shares outstanding 78,276,758   78,247,026   70,697,944  
 
* Tangible Common Equity and Tangible Assets 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

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

Source: Wilshire Bancorp, Inc.


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