Regional banking company Hope Bancorp (NASDAQ: HOPE) fell short of the market’s revenue expectations in Q1 CY2026, but sales rose 21.2% year on year to $139.9 million. Its non-GAAP profit of $0.23 per share was in line with analysts’ consensus estimates.

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StockStory’s Take

Hope Bancorp’s first quarter results showed revenue growth of 22.1% year-over-year, though this performance missed Wall Street expectations. Management attributed the increase to organic growth and the contribution from the Territorial Bancorp acquisition. CEO Kevin Kim highlighted that pre-provision net revenue rose due to improved efficiency and ongoing efforts to lower deposit costs. The company continued to resolve problem loans, with criticized loans declining 7% sequentially, while a higher provision for credit losses reflected the clean-up of previously identified troubled credits. CFO Julianna Balicka noted that noninterest expense remained well managed, even as the company absorbed higher operating costs from recent acquisitions.

Looking ahead, Hope Bancorp’s outlook centers on the pending acquisition of SMBC Manubank, expected to close later this year. Management anticipates the transaction will drive over 20% loan growth and boost revenue toward the upper end of its 15%–20% range for 2026, with early benefits from lower-cost deposits and expanded commercial banking capabilities. CFO Julianna Balicka stated, “We anticipate year-over-year total revenue growth to be at the higher end of our 15% to 20% range for the full year of 2026,” assuming a mid-year close for Manubank. The company also expects continued improvement in deposit costs and steady asset quality, but acknowledged that full cost savings from the acquisition will be realized in 2027.

Key Insights from Management’s Remarks

Management emphasized that Q1 performance reflected both organic growth and the initial benefits from recent acquisitions, while highlighting the pending Manubank deal as central to future strategy.

• Territorial Bancorp acquisition: Management pointed to the Territorial Bancorp acquisition as a key driver of year-over-year growth in loans and deposits, noting its contribution to both scale and diversification.
• Pending Manubank transaction: The company announced an agreement to acquire SMBC Manubank’s commercial banking unit, aiming to deepen its presence in Los Angeles and expand its services to Asian multinational clients. Management expects this deal to add $2.5 billion in loans and $2.7 billion in deposits, mostly low-cost, and to be accretive to earnings in 2027.
• Deposit cost management: CFO Julianna Balicka highlighted ongoing reductions in deposit costs as maturing certificates of deposit (CDs) are replaced with lower-rate offerings. She noted a 77-basis point year-over-year decline in average interest-bearing deposit costs.
• Expense discipline: The company maintained a focus on expense control, with the efficiency ratio improving both year-over-year and quarter-over-quarter, despite higher noninterest expenses from recent acquisitions.
• Credit quality progress: Asset quality continued to improve, evidenced by declines in criticized loans and nonperforming assets, as well as active resolution of previously identified problem loans. Management remains focused on maintaining steady credit performance as the loan book grows.

Drivers of Future Performance

Hope Bancorp’s guidance assumes robust loan growth driven by the Manubank acquisition, ongoing deposit cost improvements, and disciplined expense management.

• Manubank integration and loan growth: Management expects the Manubank acquisition to drive loan growth above 20% for the year, with new lending focused on commercial and industrial clients as well as residential mortgages. The integration is also projected to diversify and lower the cost of deposits, though full synergy realization is set for 2027.
• Deposit repricing benefits: CFO Julianna Balicka outlined that continued repricing of maturing CDs at lower rates is expected to reduce funding costs by 5–7 basis points each quarter. This should support net interest margin expansion, provided the Federal Reserve maintains its current rate stance.
• Expense and asset quality vigilance: The company anticipates a modest increase in expenses as loan production and revenue grow, but aims to maintain operational discipline. Management also expects asset quality to remain stable, though acknowledges that credit costs may fluctuate as problem loans are resolved.

Catalysts in Upcoming Quarters

Looking forward, the StockStory team will be tracking (1) the timing and regulatory approval of the Manubank acquisition and its initial financial impact, (2) whether cost savings and deposit repricing efforts continue to improve net interest margins as planned, and (3) management’s ability to keep asset quality stable amid rapid loan growth. Updates on commercial banking expansion and integration progress will also serve as key performance indicators.

Hope Bancorp currently trades at $12.95, up from $12.65 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free).

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