[Management View]
Hanmi Financial Corporation reported a substantial rise in net income to $22.1 million, or $0.73 per diluted share, driven by higher net interest income and lower credit loss expense. Key strategic priorities included expanding the commercial loan portfolio, particularly through the USKC initiative, and maintaining strong asset quality.

[Outlook]
Management raised full-year loan growth guidance to mid-single-digit range and expects continued capital returns through share repurchases. They anticipate maintaining discipline in deposit costs and achieving reasonable deposit betas if the Federal Reserve implements further rate cuts.

[Financial Performance]
Net income increased to $22.1 million from $15.1 million in the prior quarter. Pre-provision net revenue rose 16.4% to $47 million. Net interest income grew 6.9% to $61.1 million, and net interest margin expanded by 15 basis points to 3.22%. Total loans increased by 3.5% to $6.53 billion, with significant growth in C&I and CRE loan production.

[Q&A Highlights]
Question 1: Did the strong loan growth in Q3 include any pull forward, and what is the outlook for loan growth going forward?
Answer: Net loan growth is a function of production and payoffs. The guidance of mid-single-digit loan growth for the year considers the uncertainty of payoffs in Q4. The strong production in Q3 was due to higher-than-expected new loans, driven by investments in C&I lending teams and diversified industries.

Question 2: What is the outlook for asset quality and any changes in credit management?
Answer: Hanmi has been comprehensive and consistent in managing the loan portfolio, focusing on identifying and addressing potential problematic loans. The asset quality remains clean, with satisfactory trends in mortgage and SBA loans.

Question 3: How is Hanmi managing funding and the balance sheet given the strong loan growth?
Answer: The average loan-to-deposit ratio was lower in Q3, indicating better balance sheet utilization. Deposit growth is needed to support additional loan growth, and management anticipates deposit costs to decrease with expected Federal Reserve rate cuts.

Question 4: Can Hanmi achieve a downward deposit beta near 70% with subsequent rate cuts?
Answer: Management is optimistic about maintaining discipline in deposit costs and achieving reasonable betas. The team has successfully reduced rates following the September rate cut and expects to do the same with future cuts.

Question 5: What is the competition like on the lending side, and are there any compressing spreads?
Answer: There is competition, especially in CRE, but Hanmi selectively competes on particular loans. Despite competitive CD pricing, the competition is manageable.

Question 6: Will Hanmi remain active in share repurchases given healthy capital levels?
Answer: The board reviews repurchases each quarter and will continue to do so. Repurchases are expected each quarter, but the volume may vary.

Question 7: Will the gains from mortgage loan sales continue in the coming quarters?
Answer: Hanmi anticipates gains from residential mortgage sales each quarter, subject to market conditions.

Question 8: What is the business sentiment in Korea regarding the USKC initiative?
Answer: There is strong interest from mid-sized Korean businesses in expanding into the US market. The recent trip to Korea provided valuable opportunities to connect with Korean business leaders and introduce Hanmi's banking services.

Question 9: What is Hanmi's NDFI exposure?
Answer: The NDFI exposure is very small, less than 1%.

[Sentiment Analysis]
Analysts were positive about Hanmi's strong loan growth and improved asset quality. Management maintained an optimistic tone, emphasizing strategic investments and disciplined expense management.

[Quarterly Comparison]
| Metric | Q3 2025 | Q2 2025 |
|-------------------------------|-----------------|-----------------|
| Net Income | $22.1 million | $15.1 million |
| EPS | $0.73 | $0.50 |
| Pre-Provision Net Revenue | $47 million | $40.4 million |
| Net Interest Income | $61.1 million | $57.2 million |
| Net Interest Margin | 3.22% | 3.07% |
| Total Loans | $6.53 billion | $6.31 billion |
| Loan Production | $571 million | $330 million |
| Efficiency Ratio | 52.65% | 55.74% |

[Risks and Concerns]
Potential risks include the uncertainty of loan payoffs in Q4, competitive pressures in the lending and deposit markets, and the impact of Federal Reserve rate cuts on deposit costs and net interest margin.

[Final Takeaway]
Hanmi Financial Corporation delivered a strong Q3 performance with significant loan growth, improved asset quality, and disciplined expense management. The USKC initiative and strategic investments in commercial lending teams contributed to the positive results. Management remains optimistic about achieving mid-single-digit loan growth for the year and continuing capital returns through share repurchases. Investors should monitor potential risks related to loan payoffs, competitive pressures, and interest rate changes.