About Hope Bancorp

Hope Bancorp, Inc. operates as the bank holding company for Bank of Hope that provides commercial and retail banking loan and deposit products. The bank primarily focuses its business in ethnic communities in California, the greater New York City, Chicago, Houston, Dallas, and Seattle metropolitan areas, New Jersey, Virginia, Georgia, Alabama and Florida. The company, through its network of branches and loan production offices, offers core business banking products for small and medium-sized businesses and individuals. The company accepts deposits and originates a variety of loans, including commercial business loans, real estate loans, trade finance loans, Small Business Administration (SBA) loans, auto loans, single-family mortgages, warehouse lines of credit, personal loans, and credit cards. The company offers cash management services to its business customers, which include remote deposit capture, lock box, and ACH origination services. The company offers comprehensive investment and wealth management services to high-net-worth clients. The company also offers a mobile banking application for smart devices that extends access to banking services, such as mobile deposits and bill payment for its customers at all times. In an effort to better meet its customers’ needs, the company’s mini-market branches generally offer hours from 9 a.m. to 6 p.m. Most of its branches offer 24-hour automated teller machines (ATMs). The company also offers debit card services to all customers. In addition, most of its branches offer foreign exchanges services, safe deposit boxes, and other customary bank services. The company’s website at www.bankofhope.com offers internet banking services and applications in both English and Korean. Lending Activities Commercial Business Loans The company provides commercial loans to businesses through its Consumer and Business Banking and Corporate Banking Group. The Consumer and Business Banking department primarily provides financial products and services to individuals and small businesses through the company’s branch network. The Corporate Banking Group primarily provides commercial loans to middle market and large institutional borrowers. Corporate Banking lending is generally done through various groups, including general industry groups, Sponsor and Specialty Finance, Telecom and Media, Healthcare and Equipment Finance. These commercial loans are provided for various purposes, such as for working capital, purchasing inventory, debt refinancing, business acquisitions, and other business-related financing needs. Commercial loans are typically classified as short-term loans (or lines of credit) or long-term loans (or term loans to businesses). Short-term loans are often used to finance business working capital needs, collateralized with current assets, and typically have terms of one year with interest paid monthly on the outstanding balance with the principal balance due at maturity. Long-term loans typically have terms of three to five years with principal and interest paid monthly. The credit worthiness of the company’s borrowers is evaluated before a loan is originated through financial spread and collateral analysis and if large enough, with financial projections to cover both base and downside case cash flow scenarios; and are largely reviewed quarterly to address potential borrower covenant defaults/appropriate borrower action plans, as well as regulatory loan grading. The company seeks to establish full borrower relationships for all the company’s commercial customers to include all of the bank’s products, such as deposits, treasury management, as well as a broad array of risk management products. The company also provides warehouse lines of credit to mortgage loan originators. The lines of credit are used by these originators to fund mortgages which are then pledged to the bank as collateral until the mortgage loans are sold and the lines of credit are paid down. The typical duration of these lines of credit from the time of funding to pay-down ranges from 10-30 days. Although collateralized by mortgage loans, the structure of warehouse lending agreements results in the commercial business loan treatment for these types of loans. The company provides commercial equipment lease financing through a relationship with a third-party leasing company. Equipment leasing loans are generally capital leases with maturities up to five years. In addition, the company has a portfolio of syndicated loans in which the company is one in a group of lenders that collectively provide credit to worthy borrowers. Real Estate Loans Real estate loans cover a broad array of commercial real estate segments and are extended for the purchase and refinance of real estate and are generally secured by first deeds of trust. The maturities on the majority of such loans are generally five to seven years with a 25-year principal amortization schedule and a balloon payment due at maturity. The company offers both fixed and floating rate real estate loans in addition to offering clients interest rate hedging option. The company originates loans to finance commercial real estate construction projects, including one-to-four family residences, multifamily residences, senior housing, and commercial projects. Residential construction loans are due upon the sale of the completed project and are generally collateralized by first liens on the real estate and have floating interest rates. Construction loans are considered to have higher risks than other loans due to the ultimate repayment being sensitive to commercial real estate segments, geographic market and macroeconomic changes, interest rate changes, governmental regulation of real property, and the availability of long-term financing. Small Business Administration Loans The company extends loans partially guaranteed by the SBA. The company primarily extends SBA loans known as SBA 7(a) loans and SBA 504 loans. SBA 7(a) loans are typically extended for working capital needs, purchase of inventory, purchase of machinery and equipment, debt refinance, business acquisitions, start-up financing, or to purchase or construct owner-occupied commercial property. SBA 7(a) loans are typically term loans with maturities up to 10 years for loans not secured by real estate and up to 25 years for real estate secured loans. SBA loans are fully amortizing with monthly payments of principal and interest. SBA 7(a) loans are typically floating rate loans that are secured by business assets and/or real estate. The company is generally able to sell the guaranteed portion of the SBA 7(a) loans in the secondary market at a premium while earning servicing fee income on the sold portion over the remaining life of the loan. SBA 504 loans are typically extended for the purpose of purchasing owner-occupied commercial real estate or long-term capital equipment. SBA 504 loans are typically extended for up to 20 years or the life of the asset being financed. SBA 504 loans are financed as a participation loan between the bank and the SBA through a Certified Development Company (‘CDC’). All of the company’s SBA loans are originated through the company’s SBA Loan Departments and certain loan production offices. The SBA Loan Departments are staffed by loan officers who provide assistance to qualified businesses. The bank has been designated as an SBA Preferred Lender, which is the highest designation awarded by the SBA. This designation generally facilitates a more efficient marketing and approval process for SBA loans. The company has attained SBA Preferred Lender status nationwide. Consumer Loans The company’s consumer loans consist of single-family mortgages, home equity, auto loans, credit card loans, and personal loans, with a majority of the company’s consumer loan portfolio consisting of single-family mortgages secured by a first deed of trust on single family residences under a variety of loan products, including fixed-rate and adjustable-rate mortgages with either 30-year or 15-year terms. Adjustable rate mortgage loans are also offered with flexible initial and periodic adjustments ranging from five to seven years. Investing Activities The company’s investments include equity investments, available for sale and held to maturity investment portfolios, which consist of the U.S. Treasury securities, government sponsored agency bonds, mortgage-backed securities, collateralized mortgage obligations (‘CMOs’), asset-backed securities, corporate securities, and municipal securities. Deposit Activities The company attracts both short-term and long-term deposits from the general public by offering a wide range of deposit products and services. Through the company’s branch network, it provides the company’s banking customers with personal and business checking accounts, money market accounts, savings accounts, time deposit accounts, individual retirement accounts, 24-hour ATMs, internet banking and bill-pay, remote deposit capture, lock boxes, and ACH origination services. In addition to the company’s retail and business deposits, the company obtains both secured and unsecured wholesale deposits, including public deposits, such as State of California Treasurer’s time deposits, brokered demand deposits, money market, and time deposits, and deposits gathered from outside of the bank’s normal market area through deposit listing services and the company’s online banking platform. Market Area The company has banking offices in areas having high concentrations of Korean-Americans, which are located in the Los Angeles, Orange County, Oakland and Silicon Valley (Santa Clara County) areas of California; in the New York City metropolitan area and New Jersey; in the Chicago metropolitan area; in the Seattle metropolitan area; in Texas, in Virginia, in Alabama, and in Georgia. The company also has loan production offices located in Houston, Dallas, Seattle, Atlanta, Denver, Portland, Tampa, Fremont, and Southern California; and a representative office in Seoul, South Korea. Supervision and Regulation The company is a registered bank holding company under the Bank Holding Company Act. As a bank holding company, the company is subject to regulation, supervision and regular examination by the FRB and is required to file periodic reports of its operations with the FRB and other such reports as the FRB may require. The company is also a bank holding company within the meaning of Section 3700 of the California Financial Code. Therefore, the company and its subsidiaries are subject to examination by, and may be required to file reports with, the California Department of Financial Protection and Innovation (the ‘DFPI’). The bank’s deposits are insured by the Federal Deposit Insurance Corporation (the ‘FDIC’), up to applicable limits. The bank is a California state-chartered bank whose deposit accounts are insured by the FDIC, up to applicable limits. As such, the bank is subject to regulation, supervision and regular examination by the DFPI and the FDIC. In addition, while the bank is not a member of the FRB, the bank is subject to certain regulations of the FRB. As a banking organization with consolidated assets exceeding $10 billion, the company is subject to heightened supervision and regulation imposed by the Dodd-Frank Act, such as the following: The company is subject to periodic examination by the Consumer Finance Protection Bureau (‘CFPB’) with respect to compliance with federal consumer laws. The company is subject to the ‘Volcker Rule,’ which generally restricts the company from engaging in activities that are considered proprietary trading and from sponsoring or investing in certain entities, including hedge or private equity funds that are considered covered funds. Many aspects of the Dodd-Frank Act continue to be subject to rule-making or proposed change, making it difficult to anticipate the overall financial impact on the company, its customers or the financial industry in general. The bank must comply with numerous federal and state consumer protection statutes and implementing regulations, including but not limited to, the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, the Equal Credit Opportunity Act, the Truth in Lending Act, the Fair Housing Act, the Home Mortgage Disclosure Act, the Real Estate Settlement Procedures Act, the National Flood Insurance Act, the California Homeowner Bill of Rights and various federal and state privacy protection laws, including the Telephone Consumer Protection Act, and CAN-SPAM Act. The bank is subject to the CRA, which requires federal banking regulators to evaluate the record of a financial institution in meeting the credit needs of its local communities, including low and moderate income neighborhoods. The bank is subject to examination by the CFPB. History Hope Bancorp, Inc. was founded in 2000. The company was incorporated in Delaware in 2000.