Executive Summary

Q1 2025 EPS of $0.17 GAAP ($0.19 ex-notables) and “Revenue” (company-defined) of $116.5M; Primary EPS beat S&P Global consensus by ~$0.01 while S&P revenue missed as definitions differ (company revenue $116.5M vs S&P “revenue” actual $109.7M) . EPS upside was driven by a 4 bps NIM expansion and a lower provision on sequentially lower net charge-offs .
Deposit mix improved: total deposits +1% QoQ to $14.49B with brokered deposits falling to <7% of total; cost of interest-bearing deposits fell 24 bps QoQ to 4.14% helping NIM +4 bps to 2.54% .
Territorial Bancorp acquisition closed Apr 2 (after quarter-end): adds ~$1.7B low-cost deposits (1.96% WA cost) and ~$1.0B residential mortgages; 2025 accretion income now ~+$14M; one-time Q2 acquisition costs expected at ~$18M .
2025 guidance updated: NII growth trimmed to high single-digits (from low double-digits), noninterest income raised to mid-20s% growth, loans still high single-digit, opex (ex-notables) low double-digit; dividend maintained at $0.14/share .

What Went Well and What Went Wrong

What Went Well
- NIM inflected +4 bps QoQ to 2.54% as interest-bearing deposit costs fell; management highlighted lower Fed funds and mix efforts as drivers .
- Deposit quality improved: customer deposits rose, brokered time deposits reduced to <7% of total; total deposits +1% QoQ to $14.49B; loan-to-deposit ratio improved to 92% .
- Credit trends stabilizing: NPAs down 8% QoQ to 0.49% of assets; net charge-offs fell to 0.25% (from 0.38%); ACL coverage steady at 1.11% .
- Quote: “Our healthy levels of capital and ample liquidity provide us a robust cushion to support prudent growth opportunities...” – Kevin S. Kim, CEO .
What Went Wrong
- Net interest income modestly down 1% QoQ (two fewer days, lower floating loan yields, lower average loans), partially offset by deposit cost relief .
- Noninterest expense up to $83.9M GAAP (ex-notables $81.3M; +6% QoQ) on seasonal payroll taxes/bonus true-ups/vacation accruals and merger costs .
- Loan balances declined 2% QoQ; C&I −5% and CRE −2% as aggressive pricing, paydowns/payoffs, and selective renewals weighed on growth .

Financial Results

Headline P&L and Ratios (Company-reported “Revenue,” GAAP unless noted)

Metric	Q1 2024	Q4 2024	Q1 2025
Revenue (Net interest income before provision + Noninterest income) ($M)	$123.3	$118.0	$116.5
Net Interest Income Before Provision ($M)	$115.0	$102.1	$100.8
Provision for Credit Losses ($M)	$2.6	$10.0	$4.8
Noninterest Income ($M)	$8.3	$15.9	$15.7
Noninterest Expense ($M)	$84.8	$77.6	$83.9
Efficiency Ratio (GAAP)	68.79%	65.75%	71.98%
Efficiency Ratio ex-notables	66.81%	65.81%	69.82%
Diluted EPS ($)	$0.21	$0.20	$0.17
EPS ex-notables ($)	$0.23	$0.20	$0.19
ROA (annualized)	0.54%	0.57%	0.49%
ROTCE (annualized)	6.24%	5.76%	5.02%
Net Interest Margin	2.55%	2.50%	2.54%

Consensus vs. Actuals (S&P Global definitions)

Metric	Q1 2024	Q4 2024	Q1 2025
Primary EPS Consensus Mean	$0.262*	$0.200*	$0.185*
Primary EPS Actual	$0.23*	$0.20*	$0.19*
Revenue Consensus Mean ($M)	$130.5*	$119.8*	$115.0*
Revenue Actual ($M)	$118.6*	$114.6*	$109.7*

Values retrieved from S&P Global.
Note: S&P “Primary EPS” aligns with company EPS excluding notable items; S&P “revenue” may differ from company-defined “Revenue” used for PPNR .

Credit and Balance Sheet KPIs

KPI	Q1 2024	Q4 2024	Q1 2025
Total Deposits ($B)	$14.75	$14.33	$14.49
Gross Loan-to-Deposit Ratio	93.0%	95.2%	92.0%
NIB Demand Deposits (% of total)	24.7%	23.6%	23.2%
IB MM/IDD/Savings (% of total)	36.0%	36.1%	37.3%
Time Deposits (% of total)	39.3%	40.3%	39.5%
Brokered Deposits (% of total)	—	—	<7%
NPA / Assets	0.59%	0.53%	0.49%
Net Charge-off Ratio (annualized)	0.10%	0.38%	0.25%
ACL / Loans	1.16%	1.11%	1.11%
CET1 / Tier 1 / Total Capital	12.47% / 13.17% / 14.19%	13.06% / 13.79% / 14.78%	13.28% / 14.02% / 15.06%

Loan Mix (End of Period)

Loan Type	Q1 2024	Q4 2024	Q1 2025
CRE ($B, % of loans)	$8.71 (63.5%)	$8.53 (62.6%)	$8.38 (62.8%)
C&I ($B, % of loans)	$4.04 (29.4%)	$3.97 (29.1%)	$3.76 (28.2%)
Residential & Other ($B, % of loans)	$0.97 (7.1%)	$1.12 (8.2%)	$1.20 (9.0%)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
End-of-Period Loans (incl. HFS)	FY 2025 vs 2024	High single-digit % growth	High single-digit % growth	Maintained
Net Interest Income	FY 2025 vs 2024	Low double-digit % growth	High single-digit % growth	Lowered
Noninterest Income	FY 2025 vs 2024	Mid-teen % growth	Mid-20s % growth	Raised
Noninterest Expense (ex-notables)	FY 2025 vs 2024	Low double-digit % growth	Low double-digit % growth	Maintained
One-time Merger Costs	Q2 2025	—	~$18M pre-tax expected	New detail
Accretion Income from Territorial	FY 2025	Prior higher view	~+$14M for 2025	Updated lower
Dividend	Ongoing	—	$0.14 per share declared	Affirmed

Assumptions noted by management include three 25 bps Fed cuts in June, September, December 2025 embedded in outlook .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024 and Q4 2024)	Current Period (Q1 2025)	Trend
NIM/Deposit Costs	Q3: NIM 2.55% with rising deposit costs; signs of deposit cost inflection by Sept-end . Q4: NIM 2.50% (2.54% ex nonaccrual reversal effect); cost of total deposits down 12 bps QoQ .	NIM +4 bps QoQ to 2.54%; IB deposit cost −24 bps QoQ to 4.14% .	Improving as deposit costs decline.
Deposit Mix/Brokered	Q3: Customer deposits +; brokered reduced; NIB improved . Q4: Brokered deposits down to 7% of total .	Deposits +1% QoQ; brokered <7% of total .	Continued mix improvement.
Credit Quality	Q3: NPAs rose due to one relationship; ACL 1.13% . Q4: NPAs 0.53%; criticized loans −11% QoQ .	NPAs 0.49%; NCOs 0.25% (from 0.38%) .	Stabilizing to improving.
Loan Growth/Pipelines	Q3: Loans up modestly; SBA sales active . Q4: Loans flat QoQ .	Loans −2% QoQ; pipelines building in Korean subsidiaries and specialized C&I (healthcare, project/structured finance) .	Near-term muted; back-half acceleration targeted.
Territorial Merger	Q3: Pending; strategic benefits highlighted . Q4: Expect close in Q1 2025 .	Closed 4/2; $1.7B deposits (1.96% cost), $1.06B loans, ~$14M 2025 accretion; $18M Q2 one-time costs .	Integration underway; EPS accretive per management.
Macro/Policy	Q4: Multiple Fed cuts impacted yields; renewable energy tax credits reduced ETR .	Rate cuts in late 2024 flowed through; tariff/macro uncertainty monitored .	Rate tailwind vs macro caution.

Management Commentary

“We continued to focus on enhancing our deposit mix, and growth in customer deposits more than offset planned reductions in brokered time deposits.” – Kevin S. Kim, CEO .
“Net interest margin…expanded by four basis points to 2.54%…primarily driven by the decrease in interest bearing deposit costs.” – Company commentary .
“Our updated accretion income expectations for ’25 are $14 million…[and] we expect our 2025 second quarter results will include onetime pretax acquisition-related expenses of approximately $18 million.” – Julianna Balicka, CFO .
“Asset quality has remained stable…borrowers are being proactive to mitigate…potential impact from tariffs by diversifying supply chains.” – Peter Koh, COO .

Q&A Highlights

Rate sensitivity of NII/NIM: Fewer than three assumed Fed cuts would be “modestly” negative; each 25 bps cut roughly nets out (loan yield compression vs deposit repricing), with slight downward bias depending on execution .
Loan growth composition: Expect moderate organic growth from Korean subsidiary sectors and specialized C&I (healthcare, project finance, structured finance); recent hiring supports pipeline build .
Credit watch items: Monitoring tariff environment; borrowers diversifying supply chains; asset quality viewed as “healthy and stable” .
Guidance context: 2025 NII trimmed to high single-digits on updated merger accretion and growth timing; fee income outlook raised to mid‑20s% on broad-based momentum .

Estimates Context

Q1 2025 vs S&P Global consensus: Primary EPS $0.19 actual vs $0.185 est (beat); revenue $109.7M actual vs $115.0M est (miss). Company-defined “Revenue” was $116.5M, illustrating definitional differences. Values retrieved from S&P Global.
Implications: Modest EPS beat on mix/NIM and lower provision; revenue shortfall (S&P def.) should be parsed vs company “Revenue.” Street models may raise fee income lines and trim NII trajectory given the guidance change, while incorporating Q2 one-offs and ~$14M 2025 accretion (and subsequent run-rate effects) .

Key Takeaways for Investors

Deposit-cost tailwind emerging: IB deposit costs −24 bps QoQ supported a 4 bps NIM lift; if the Fed cuts continue, NIM trajectory can stabilize to slightly up despite floating-rate loan resets .
Mix improvement is tangible: Brokered deposits <7% with total deposits +1% QoQ; LDR now 92%, giving balance sheet flexibility for prudent growth .
Credit normalizing: NPAs down and NCOs improved; ACL coverage steady at 1.11%; watch C&I/CRE delinquency buckets but overall trends are manageable .
Territorial acquisition is strategically and financially additive: ~$1.7B low-cost deposits and ~$1.0B high-quality mortgages; ~$14M 2025 accretion, but expect ~$18M Q2 one-time costs .
2025 outlook mixed: NII growth reduced to high single-digits, but fee income raised to mid‑20s%; Street likely to reallocate earnings mix and adjust quarterly cadence (Q2 one-time noise) .
Expense discipline remains a lever: Q1 seasonal comp lifted opex; ex-notables efficiency 69.8% suggests room to improve as accretion/scale benefits materialize in 2H .
Positioning: Near-term trading may hinge on integration updates and NIM trajectory; medium-term thesis rests on deposit-cost normalization, back-half loan growth, and Territorial synergy capture .

All data points from company materials are cited. S&P Global consensus and actuals are marked with an asterisk and are Values retrieved from S&P Global.

HOPE BANCORP INC (HOPE)·Q1 2025 Earnings Summary