Hope Bancorp Inc., a financial institution primarily serving small to medium-sized businesses, announced on Tuesday a drop in net profits for the fourth quarter. The decrease was largely attributed to the impact of $15.047 million in special items, increased total interest and non-interest expenses, and a drop in total non-interest income. Despite these challenges, the bank's earnings exceeded market expectations.
The bank reported a net profit of $26.481 million, or $0.22 per share, for the last three months, down from the $51.703 million or $0.43 per share recorded in the equivalent period last year.
When omitting the impact of special items, earnings stood at $38.338 million or $0.32 per share, down from $51.703 million or $0.43 per share in the same period from the previous year.
According to a poll of four analysts by Thomson Reuters, expectations were for the lender to report earnings of $0.21 per share for the quarter, not taking into account any special items.
The report showed total notable items amounted to $15.047 million, substantially increased from the previous year, which had no notable items.
Pre-tax earnings saw a decrease, falling to $33.605 million from $69.913 million in 2022.
Total non-interest income also fell to $9.280 million, down from $12.110 million last year.
Expenses related to non-interest items increased, finishing at $99.891 million compared to the previous $84.518 million in 2022.
The provision for credit losses sharply decreased to $1.700 million, down from $8.200 million a year previously.
Net interest income, after provision for credit losses, stood at $124.216 million, which was lower than the $142.321 million recorded in the previous year.
On a brighter note, total interest income rose to $269.224 million, up from $224.237 million last year. However, total interest expenses significantly increased to $143.308 million, up from $73.716 million recorded a year ago.
