compared with third quarter 2025 net income of $6.7 million, diluted EPS of $0.45, and fourth quarter 2024 net income of $5.0 million, diluted EPS of $0.33
Higher net interest income; lower provision for credit losses
LOS ANGELES–(BUSINESS WIRE)–OP Bancorp (the “Company”) (NASDAQ: OPBK), parent company of Open Bank, today reported:
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As of and For the Quarter |
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Fourth Quarter Highlights |
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| ($ in thousands, except per share data) |
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4Q2025 |
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3Q2025 |
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4Q2024 |
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Comparisons reflect 4Q25 vs. 3Q25 |
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Income Statement: |
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Income Statement |
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Net interest income |
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$ |
20,863 |
|
|
$ |
20,346 |
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$ |
16,929 |
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Noninterest income |
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3,418 |
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4,130 |
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4,417 |
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Revenue |
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24,281 |
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24,476 |
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21,346 |
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Provision for credit losses |
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|
463 |
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1,175 |
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1,547 |
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Noninterest expense |
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14,293 |
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13,629 |
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13,133 |
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Net income |
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$ |
7,059 |
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$ |
6,703 |
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$ |
4,971 |
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Diluted Earnings Per Share (“EPS”) |
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$ |
0.47 |
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$ |
0.45 |
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$ |
0.33 |
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Net interest margin (1) |
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3.25 |
% |
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3.26 |
% |
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2.96 |
% |
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Efficiency ratio (2) |
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58.87 |
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55.68 |
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61.52 |
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Balance Sheet: |
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Balance Sheet |
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Average loans (3) |
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$ |
2,204,232 |
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$ |
2,132,230 |
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$ |
1,947,653 |
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Average deposits |
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2,264,990 |
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2,229,591 |
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2,029,855 |
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Credit Quality: |
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Credit Quality |
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Net recoveries (charge-offs) (1) to average gross loans |
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0.03 |
% |
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(0.04 |
)% |
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(0.00 |
)% |
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Allowance for credit losses on loans to gross loans |
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1.28 |
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1.27 |
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1.27 |
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Selected Ratios: |
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Performance and Capital |
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Return on average assets (“ROA”) (1) |
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1.07 |
% |
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1.04 |
% |
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0.84 |
% |
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Return on average equity (“ROE”) (1) |
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12.57 |
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12.36 |
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9.75 |
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Common equity tier 1 capital (“CET1”) |
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10.93 |
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10.92 |
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11.35 |
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(1) |
Annualized. |
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(2) |
Represents noninterest expense divided by the sum of net interest income and noninterest income. |
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(3) |
Includes loans held-for-sale. |
Sang K. Oh, President and Chief Executive Officer:
“Our fourth-quarter results highlight the continued strength and resilience of our Company. Net interest income increased 3%, and a more favorable economic outlook resulted in a 61% reduction in provision for credit losses while maintaining an adequate reserve level against credit risk. As a result, net income rose 5%, and diluted EPS also increased $0.02 to $0.47. On the balance sheet, average loans grew 3% and average deposits increased 2%, demonstrating the ongoing trust of our customers and the effectiveness of our relationship-driven approach. Asset quality remained stable, and our capital position stayed robust, underscoring the soundness of our risk management framework. As we close out 2025, we remain focused on executing our strategic priorities, supporting our customers and communities, and delivering long-term value for our shareholders,” said Sang K. Oh, President and Chief Executive Officer.
INCOME STATEMENT HIGHLIGHTS
Net Interest Income and Net Interest Margin
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For the Three Months Ended |
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% Change 4Q2025 vs. |
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| ($ in thousands) |
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4Q2025 |
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3Q2025 |
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4Q2024 |
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3Q2025 |
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4Q2024 |
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Interest Income |
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Interest income |
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$ |
39,282 |
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$ |
38,522 |
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$ |
35,051 |
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2 |
% |
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12 |
% |
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Interest expense |
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18,419 |
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18,176 |
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18,122 |
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1 |
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2 |
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Net interest income |
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$ |
20,863 |
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$ |
20,346 |
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$ |
16,929 |
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3 |
% |
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23 |
% |
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For the Three Months Ended |
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Average Yield/Rate Change 4Q2025 vs. |
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4Q2025 |
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3Q2025 |
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4Q2024 |
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| ($ in thousands) |
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Interest Income/Expense |
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Average Yield/Rate(1) |
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Interest Income/Expense |
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Average Yield/Rate(1) |
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Interest Income/Expense |
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Average Yield/Rate(1) |
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3Q2025 |
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4Q2024 |
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Interest-earning Assets: |
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Loans |
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$ |
35,921 |
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6.48 |
% |
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$ |
35,001 |
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6.52 |
% |
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$ |
31,729 |
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6.49 |
% |
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(4) bps |
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(1) bps |
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Total interest-earning assets |
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39,282 |
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6.11 |
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38,522 |
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6.16 |
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35,051 |
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6.12 |
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(5) bps |
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(1) bps |
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Interest-bearing Liabilities: |
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Interest-bearing deposits |
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17,324 |
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3.97 |
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17,442 |
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4.07 |
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17,182 |
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4.60 |
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(10) bps |
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(63) bps |
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Total interest-bearing liabilities |
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18,419 |
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3.99 |
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18,176 |
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4.06 |
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18,122 |
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4.58 |
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(7) bps |
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(59) bps |
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Ratios: |
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Net interest income / interest rate spreads |
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20,863 |
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2.12 |
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20,346 |
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2.10 |
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16,929 |
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1.54 |
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2 bps |
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58 bps |
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Net interest margin |
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3.25 |
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3.26 |
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2.96 |
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(1) bps |
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29 bps |
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Total deposits / cost of deposits |
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17,324 |
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3.03 |
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17,442 |
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3.10 |
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17,182 |
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3.37 |
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(7) bps |
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(34) bps |
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Total funding liabilities / cost of funds |
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18,419 |
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3.09 |
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18,176 |
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3.13 |
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18,122 |
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3.41 |
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(4) bps |
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(32) bps |
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(1) |
Annualized. |
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For the Three Months Ended |
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Average Yield Change 4Q2025 vs. |
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4Q2025 |
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3Q2025 |
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4Q2024 |
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| ($ in thousands) |
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Interest Income |
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Average Yield(1) |
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Interest Income |
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Average Yield(1) |
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Interest Income |
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Average Yield(1) |
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3Q2025 |
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4Q2024 |
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Loan Yield Component: |
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Contractual interest rate |
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$ |
35,010 |
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|
6.31 |
% |
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$ |
34,263 |
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|
6.39 |
% |
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$ |
31,406 |
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|
6.42 |
% |
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(8) bps |
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(11) bps |
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Accretion of SBA loan discount(2) |
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|
966 |
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0.17 |
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|
972 |
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0.18 |
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|
813 |
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0.17 |
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(1) bps |
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0 bps |
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Amortization of net deferred fees |
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(17 |
) |
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(0.00 |
) |
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|
70 |
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|
0.01 |
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(47 |
) |
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(0.01 |
) |
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(1) bps |
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1 bps |
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Amortization of premium |
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(301 |
) |
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(0.05 |
) |
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(244 |
) |
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(0.05 |
) |
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(363 |
) |
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(0.07 |
) |
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— bps |
|
2 bps |
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Amortization of premium – Home mortgage payoffs |
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(123 |
) |
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(0.02 |
) |
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(112 |
) |
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(0.02 |
) |
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— |
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— |
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— bps |
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(2) bps |
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Net interest recognized on nonaccrual loans |
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|
105 |
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0.02 |
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(175 |
) |
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(0.03 |
) |
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(232 |
) |
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(0.05 |
) |
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5 bps |
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7 bps |
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Prepayment penalty income and other fees(3) |
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|
281 |
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0.05 |
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|
227 |
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0.04 |
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|
152 |
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0.03 |
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1 bps |
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2 bps |
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Yield on loans |
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$ |
35,921 |
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|
6.48 |
% |
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$ |
35,001 |
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|
6.52 |
% |
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$ |
31,729 |
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|
6.49 |
% |
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(4) bps |
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(1) bps |
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(1) |
Annualized. |
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(2) |
Includes discount accretion from SBA loan payoffs of $505 thousand, $499 thousand and $329 thousand for the three months ended December 31, 2025, September 30, 2025 and December 31, 2024, respectively. |
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(3) |
Includes prepayment penalty income of $145 thousand, $127 thousand and $45 thousand for the three months ended December 31, 2025, September 30, 2025 and December 31, 2024, respectively, from Commercial Real Estate (“CRE”) and SBA loans. |
Fourth Quarter 2025 vs. Third Quarter 2025
Net interest income increased by $517 thousand, or 3%, primarily driven by loan growth. This increase was partially offset by higher expense associated with the issuance of a new subordinated note and lower yields on the Federal Reserve account. Net interest margin contracted by 1 basis point to 3.25%.
- Loans: Interest income increased by $920 thousand, largely attributable to a $72.0 million increase in average loan balances.
- Cash and Cash Equivalents: Interest income decreased by $142 thousand, mainly due to a 46 basis point reduction in yields, reflecting the lower rates on the Federal Reserve account following recent rate cuts.
- Deposits: Interest expense decreased slightly by $118 thousand, primarily due to a 10 basis point reduction in interest-bearing deposit costs, reflecting the repricing of deposit products following the decline in the federal funds rate. This benefit was mostly offset by a $31.6 million increase in average interest-bearing deposit balances.
- Subordinated Note: Interest expense was $278 thousand, attributable to the issuance of $25 million in subordinated debt in November 2025.
Fourth Quarter 2025 vs. Fourth Quarter 2024
Net interest income increased by $3.9 million, or 23%. The increase was largely due to loan growth and lower deposit rates. These changes were partially offset by interest-bearing deposit growth. Net interest margin rose 29 basis points to 3.25%.
- Loans: Interest income increased by $4.2 million, largely driven by a $256.6 million increase in average loan balances.
- Deposits: Interest expense increased by $142 thousand, mainly driven by a $246.0 million increase in average interest-bearing deposit balances. This increase was mostly offset by a 63 basis point reduction in interest-bearing deposit costs, resulting from the repricing of time deposits in response to the federal funds rate cuts.
Provision for Credit Losses
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For the Three Months Ended |
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$ Change 4Q2025 vs. |
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| ($ in thousands) |
|
4Q2025 |
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3Q2025 |
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4Q2024 |
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3Q2025 |
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4Q2024 |
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Provision for credit losses on loans |
|
$ |
518 |
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$ |
1,206 |
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$ |
1,859 |
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$ |
(688 |
) |
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$ |
(1,341 |
) |
|
Reversal of credit losses on off-balance sheet exposure |
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|
(55 |
) |
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|
(31 |
) |
|
|
(312 |
) |
|
|
(24 |
) |
|
|
257 |
|
|
Provision for credit losses |
|
$ |
463 |
|
|
$ |
1,175 |
|
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$ |
1,547 |
|
|
$ |
(712 |
) |
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$ |
(1,084 |
) |
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Fourth Quarter 2025 vs. Third Quarter 2025
Provision for credit losses on loans decreased by $688 thousand, primarily driven by an improved qualitative outlook and lower net charge-offs, partially offset by higher quantitative reserves associated with risk-rating downgrades.
Fourth Quarter 2025 vs. Fourth Quarter 2024
Provision for credit losses on loans decreased by $1.3 million, primarily due to an improved qualitative outlook and lower specific reserves, partially offset by higher quantitative reserves resulting from risk-rating downgrades.
Noninterest Income
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For the Three Months Ended |
|
% Change 4Q2025 vs. |
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| ($ in thousands) |
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|
3Q2025 |
|
4Q2024 |
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|
Noninterest Income |
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|
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Service charges on deposits |
|
$ |
462 |
|
$ |
725 |
|
$ |
967 |
|
(36 |
)% |
|
(52 |
)% |
|
Loan servicing fees, net of amortization |
|
|
650 |
|
|
724 |
|
|
858 |
|
(10 |
) |
|
(24 |
) |
|
Gains on sale of loans |
|
|
1,573 |
|
|
2,037 |
|
|
2,197 |
|
(23 |
) |
|
(28 |
) |
|
Other income |
|
|
733 |
|
|
644 |
|
|
395 |
|
14 |
|
|
86 |
|
|
Total noninterest income |
|
$ |
3,418 |
|
$ |
4,130 |
|
$ |
4,417 |
|
(17 |
)% |
|
(23 |
)% |
|
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|
|
|
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|||||
Fourth Quarter 2025 vs. Third Quarter 2025
Noninterest income decreased by $712 thousand, or 17%, primarily due to lower gains on sale of loans and service charges on deposits.
- Gains on Sale of Loans: Decreased by $464 thousand, primarily driven by lower SBA loan sale activity. During the quarter, the Bank sold $28.5 million in SBA loans at an average premium rate of 6.98%, compared to $36.8 million sold at an average premium rate of 6.71% in the prior period.
- Service Charges on Deposits: Decreased by $263 thousand, primarily due to the closure of certain currency exchange-related accounts in the third quarter of 2025 and reduced balances in existing business analysis accounts.
Fourth Quarter 2025 vs. Fourth Quarter 2024
Noninterest income decreased by $999 thousand, or 23%, primarily due to lower gains on sale of loans and service charges on deposits.
- Gains on Sale of Loans: Decreased by $624 thousand, primarily driven by lower SBA loan sale activity. During the quarter, the Bank sold $28.5 million in SBA loans at an average premium rate of 6.98%, compared to $34.7 million sold at an average premium rate of 7.82% in the prior period
- Service Charges on Deposits: Decreased by $505 thousand, largely driven by lower balances in existing business analysis account and closure of certain currency exchange-related accounts in the third quarter of 2025.
Noninterest Expense
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
For the Three Months Ended |
|
% Change 4Q2025 vs. |
|||||||||||||
| ($ in thousands) |
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|
3Q2025 |
|
4Q2024 |
||||||
|
Noninterest Expense |
|
|
|
|
|
|
|
|
|
|
||||||
|
Salaries and employee benefits |
|
$ |
9,244 |
|
|
$ |
8,892 |
|
$ |
8,277 |
|
4 |
% |
|
12 |
% |
|
Occupancy and equipment |
|
|
1,919 |
|
|
|
1,676 |
|
|
1,682 |
|
14 |
|
|
14 |
|
|
Data processing and communication |
|
|
591 |
|
|
|
263 |
|
|
594 |
|
125 |
|
|
(1 |
) |
|
Professional fees |
|
|
549 |
|
|
|
419 |
|
|
388 |
|
31 |
|
|
41 |
|
|
FDIC insurance and regulatory assessments |
|
|
362 |
|
|
|
428 |
|
|
529 |
|
(15 |
) |
|
(32 |
) |
|
Promotion and advertising |
|
|
(9 |
) |
|
|
126 |
|
|
82 |
|
NM |
|
|
NM |
|
|
Directors’ fees |
|
|
148 |
|
|
|
151 |
|
|
151 |
|
(2 |
) |
|
(2 |
) |
|
Foundation donation and other contributions |
|
|
707 |
|
|
|
671 |
|
|
480 |
|
5 |
|
|
47 |
|
|
Other expenses |
|
|
782 |
|
|
|
1,003 |
|
|
950 |
|
(22 |
) |
|
(18 |
) |
|
Total noninterest expense |
|
$ |
14,293 |
|
|
$ |
13,629 |
|
$ |
13,133 |
|
5 |
% |
|
9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
NM — Not meaningful |
Fourth Quarter 2025 vs. Third Quarter 2025
Noninterest expense increased by $664 thousand, or 5%, primarily driven by higher salaries and employee benefits, data processing and communication, and occupancy and equipment. These increases were partially offset by lower other expenses, and promotion and advertising.
- Salaries and Employee Benefits: Increased by $352 thousand, primarily due to higher incentive accruals driven by stronger SBA loan production.
- Data Processing and Communication: Increased by $328 thousand, primarily due to adjustments associated with conversion credits from a new core system vendor.
- Occupancy and equipment: Increased by $243 thousand, primarily due to the end of a common area maintenance concession on a lease that benefited the prior period.
- Other Expenses: Decreased by $221 thousand, primarily due to lower business development expenses.
Fourth Quarter 2025 vs. Fourth Quarter 2024
Noninterest expense increased by $1.2 million, or 9%, primarily due to higher salaries and employee benefits.
- Salaries and Employee Benefits: Increased by $967 thousand, mainly driven by staffing growth and annual salary adjustments effective April 2025. Higher incentive accruals further contributed to the increase.
Income Tax Expense
Fourth Quarter 2025 vs. Third Quarter 2025
Income tax expense decreased by $503 thousand to $2.5 million, with the effective tax rate declining to 25.9% from 30.7%. The decreases were primarily driven by a one-time revaluation of deferred tax assets in the prior period, resulting from the adoption of the California’s single sales factor apportionment method and the implementation of an enhanced interim state tax apportionment methodology.
Fourth Quarter 2025 vs. Fourth Quarter 2024
Income tax expense increased by $771 thousand to $2.5 million, with the effective tax rate rising to 25.9% from 25.4%. The increase in income tax expense was primarily attributable to higher pre-tax income.
BALANCE SHEET HIGHLIGHTS
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
As of |
|
% Change 4Q2025 vs. |
||||||||||||
| ($ in thousands) |
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|
3Q2025 |
|
4Q2024 |
|||||
|
CRE |
|
$ |
1,132,223 |
|
$ |
1,092,808 |
|
$ |
980,247 |
|
4 |
% |
|
16 |
% |
|
SBA |
|
|
264,523 |
|
|
256,211 |
|
|
253,710 |
|
3 |
|
|
4 |
|
|
C&I |
|
|
221,270 |
|
|
214,419 |
|
|
213,097 |
|
3 |
|
|
4 |
|
|
Home mortgage |
|
|
574,300 |
|
|
587,641 |
|
|
509,524 |
|
(2 |
) |
|
13 |
|
|
Consumer & other |
|
|
1,353 |
|
|
138 |
|
|
274 |
|
880 |
|
|
394 |
|
|
Gross loans |
|
$ |
2,193,669 |
|
$ |
2,151,217 |
|
$ |
1,956,852 |
|
2 |
% |
|
12 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|||||
The following table presents loan originations and the corresponding weighted average contractual rates for the periods indicated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
For the Three Months Ended |
|
% Change in Amounts 4Q2025 vs. |
|||||||||||||||||||||
|
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|
|
|||||||||||||||||
| ($ in thousands) |
|
Amount |
|
Rate |
|
Amount |
|
Rate |
|
Amount |
|
Rate |
|
3Q2025 |
|
4Q2024 |
||||||||
|
CRE |
|
$ |
75,750 |
|
6.60 |
% |
|
$ |
98,799 |
|
6.36 |
% |
|
$ |
63,717 |
|
6.91 |
% |
|
(23 |
)% |
|
19 |
% |
|
SBA |
|
|
26,748 |
|
8.52 |
|
|
|
15,051 |
|
8.72 |
|
|
|
14,780 |
|
9.41 |
|
|
78 |
|
|
81 |
|
|
C&I |
|
|
6,870 |
|
6.57 |
|
|
|
9,984 |
|
6.96 |
|
|
|
4,606 |
|
9.38 |
|
|
(31 |
) |
|
49 |
|
|
Home mortgage |
|
|
7,020 |
|
6.45 |
|
|
|
6,861 |
|
6.69 |
|
|
|
18,092 |
|
6.42 |
|
|
2 |
|
|
(61 |
) |
|
Consumer and other |
|
|
— |
|
— |
|
|
|
— |
|
— |
|
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
Gross loans (1) |
|
$ |
116,388 |
|
7.03 |
% |
|
$ |
130,695 |
|
6.69 |
% |
|
$ |
101,195 |
|
7.30 |
% |
|
(11 |
)% |
|
15 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
(1) |
Excludes changes in line utilization. |
The following table summarizes the loan activity for the periods indicated:
|
|
|
|
|
|
|
|
||||||
|
|
For the Three Months Ended |
|||||||||||
| ($ in thousands) |
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
||||||
|
Beginning Balance |
|
$ |
2,151,217 |
|
|
$ |
2,071,580 |
|
|
$ |
1,931,007 |
|
|
Originations |
|
|
116,388 |
|
|
|
130,695 |
|
|
|
101,195 |
|
|
Net change in line utilization |
|
|
34,191 |
|
|
|
31,167 |
|
|
|
33,736 |
|
|
Purchases |
|
|
1,014 |
|
|
|
8,930 |
|
|
|
553 |
|
|
Sales |
|
|
(28,549 |
) |
|
|
(36,806 |
) |
|
|
(34,715 |
) |
|
Payoffs & paydowns |
|
|
(75,506 |
) |
|
|
(67,639 |
) |
|
|
(79,001 |
) |
|
Decrease (increase) in loans held-for-sale |
|
|
(4,963 |
) |
|
|
13,536 |
|
|
|
3,579 |
|
|
Other |
|
|
(123 |
) |
|
|
(246 |
) |
|
|
498 |
|
|
Total |
|
|
42,452 |
|
|
|
79,637 |
|
|
|
25,845 |
|
|
Ending balance |
|
$ |
2,193,669 |
|
|
$ |
2,151,217 |
|
|
$ |
1,956,852 |
|
|
|
|
|
|
|
|
|
||||||
The following table presents the composition of gross loans by interest rate type accompanied with the weighted average contractual rates as of the periods indicated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
As of |
|||||||||||||||||
|
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|||||||||||||
| ($ in thousands) |
|
% |
|
Rate |
|
% |
|
Rate |
|
% |
|
Rate |
||||||
|
Fixed rate |
|
31 |
% |
|
5.69 |
% |
|
31 |
% |
|
5.61 |
% |
|
33 |
% |
|
5.44 |
% |
|
Hybrid rate |
|
40 |
|
|
5.93 |
|
|
41 |
|
|
5.89 |
|
|
37 |
|
|
5.66 |
|
|
Variable rate |
|
29 |
|
|
7.64 |
|
|
28 |
|
|
8.02 |
|
|
30 |
|
|
8.47 |
|
|
Gross loans |
|
100 |
% |
|
6.34 |
% |
|
100 |
% |
|
6.40 |
% |
|
100 |
% |
|
6.43 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
The following table presents the maturity of gross loans by interest rate type accompanied with the weighted average contractual rates for the periods indicated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
As of December 31, 2025 |
|||||||||||||||||||||||
|
|
Within One Year |
|
One Year Through Five Years |
|
After Five Years |
|
Total |
|||||||||||||||||
| ($ in thousands) |
|
Amount |
|
Rate |
|
Amount |
|
Rate |
|
Amount |
|
Rate |
|
Amount |
|
Rate |
||||||||
|
Fixed rate |
|
$ |
218,538 |
|
5.68 |
% |
|
$ |
272,569 |
|
6.24 |
% |
|
$ |
185,633 |
|
4.88 |
% |
|
$ |
676,740 |
|
5.69 |
% |
|
Hybrid rate |
|
|
— |
|
— |
|
|
|
202,200 |
|
4.78 |
|
|
|
687,782 |
|
6.27 |
|
|
|
889,982 |
|
5.93 |
|
|
Variable rate |
|
|
95,323 |
|
7.18 |
|
|
|
162,058 |
|
6.98 |
|
|
|
369,566 |
|
8.04 |
|
|
|
626,947 |
|
7.64 |
|
|
Gross loans |
|
$ |
313,861 |
|
6.13 |
% |
|
$ |
636,827 |
|
5.97 |
% |
|
$ |
1,242,981 |
|
6.59 |
% |
|
$ |
2,193,669 |
|
6.34 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Allowance for Credit Losses
The following table summarizes the activity in the allowance for credit losses for the periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
As of and For the Three Months Ended |
|
$ Change 4Q2025 vs. |
|||||||||||||||||
| ($ in thousands) |
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|
3Q2025 |
|
4Q2024 |
||||||||||
|
Allowance for credit losses on loans, beginning |
|
$ |
27,299 |
|
|
$ |
26,286 |
|
|
$ |
22,960 |
|
|
$ |
1,013 |
|
|
$ |
4,339 |
|
|
Provision for credit losses on loans |
|
|
518 |
|
|
|
1,206 |
|
|
|
1,859 |
|
|
|
(688 |
) |
|
|
(1,341 |
) |
|
Gross charge-offs |
|
|
— |
|
|
|
(195 |
) |
|
|
(29 |
) |
|
|
195 |
|
|
|
29 |
|
|
Gross recoveries |
|
|
158 |
|
|
|
2 |
|
|
|
6 |
|
|
|
156 |
|
|
|
152 |
|
|
Net recoveries (charge-offs) |
|
|
158 |
|
|
|
(193 |
) |
|
|
(23 |
) |
|
|
351 |
|
|
|
181 |
|
|
Allowance for credit losses on loans, ending |
|
$ |
27,975 |
|
|
$ |
27,299 |
|
|
$ |
24,796 |
|
|
$ |
676 |
|
|
$ |
3,179 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Allowance for credit losses on off-balance sheet exposure, beginning |
|
$ |
329 |
|
|
$ |
360 |
|
|
$ |
672 |
|
|
$ |
(31 |
) |
|
$ |
(343 |
) |
|
Reversal of credit losses on off-balance sheet exposure |
|
|
(55 |
) |
|
|
(31 |
) |
|
|
(312 |
) |
|
|
(24 |
) |
|
|
257 |
|
|
Allowance for credit losses on off-balance sheet exposure, ending |
|
$ |
274 |
|
|
$ |
329 |
|
|
$ |
360 |
|
|
$ |
(55 |
) |
|
$ |
(86 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Asset Quality
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
As of and For the Three Months Ended |
|
% or Basis Point Change 4Q2025 vs. |
|||||||||||||||
| ($ in thousands) |
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|
3Q2025 |
|
4Q2024 |
||||||||
|
Accruing loans 30-89 days past due |
|
$ |
6,292 |
|
|
$ |
5,386 |
|
|
$ |
8,964 |
|
|
17 |
% |
|
(30 |
)% |
|
As a % of gross loans |
|
|
0.29 |
% |
|
|
0.25 |
% |
|
|
0.46 |
% |
|
4 bps |
|
(17) bps |
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Nonperforming loans (1) |
|
$ |
14,071 |
|
|
$ |
12,312 |
|
|
$ |
7,820 |
|
|
14 |
% |
|
80 |
% |
|
Nonperforming assets (1) |
|
|
14,071 |
|
|
|
13,157 |
|
|
|
9,057 |
|
|
7 |
|
|
55 |
|
|
Nonperforming loans to gross loans |
|
|
0.64 |
% |
|
|
0.57 |
% |
|
|
0.40 |
% |
|
7 bps |
|
24 bps |
||
|
Nonperforming assets to total assets |
|
|
0.53 |
|
|
|
0.50 |
|
|
|
0.38 |
|
|
3 bps |
|
15 bps |
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Criticized loans (2)(3) |
|
$ |
32,060 |
|
|
$ |
28,075 |
|
|
$ |
19,570 |
|
|
14.2 |
% |
|
63.8 |
% |
|
Criticized loans to gross loans |
|
|
1.46 |
% |
|
|
1.31 |
% |
|
|
1.00 |
% |
|
15 bps |
|
46 bps |
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Allowance for credit losses ratios: |
|
|
|
|
|
|
|
|
|
|
||||||||
|
As a % of gross loans |
|
|
1.28 |
% |
|
|
1.27 |
% |
|
|
1.27 |
% |
|
1 bps |
|
1 bps |
||
|
As a % of nonperforming loans |
|
|
199 |
|
|
|
222 |
|
|
|
317 |
|
|
(23 |
)% |
|
(118 |
)% |
|
As a % of nonperforming assets |
|
|
199 |
|
|
|
207 |
|
|
|
274 |
|
|
(8 |
) |
|
(75 |
) |
|
As a % of criticized loans |
|
|
87 |
|
|
|
97 |
|
|
|
127 |
|
|
(10 |
) |
|
(40 |
) |
|
Net recoveries (charge-offs) (4) to average gross loans |
|
|
0.03 |
|
|
|
(0.04 |
) |
|
|
(0.00 |
) |
|
7 bps |
|
3 bps |
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
(1) |
Excludes the guaranteed portion of loans that were in liquidation totaling $20.9 million, $17.6 million and $16.3 million as of December 31, 2025, September 30, 2025 and December 31, 2024, respectively. |
|
|
(2) |
Excludes the guaranteed portion of loans that were in liquidation totaling $27.3 million, $20.8 million and $16.3 million as of December 31, 2025, September 30, 2025 and December 31, 2024, respectively. |
|
|
(3) |
Consists of special mention, substandard, doubtful and loss categories. |
|
|
(4) |
Annualized. |
Credit quality remained strong during the period, with nonperforming loans at a low 0.64% of gross loans and annualized net recoveries at just 0.03%. The allowance remained adequate at 1.28% of gross loans.
- Accruing loans 30-89 days past due increased by $906 thousand, primarily driven by $3.6 million inflows into this category, mainly SBA loans. This increase was partially offset by $1.5 million in payoffs from SBA and C&I loans, as well as $1.0 million transfer to nonaccrual status in SBA and home mortgage loans.
- Nonperforming loans increased by $1.8 million, reflecting the migration of $3.2 million in loans across multiple loan categories to nonaccrual status, partially offset by the return of a $1.4 million home mortgage loan to accrual status.
- Criticized loans increased by $4.0 million, primarily attributable to $5.2 million in loan downgrades, partially offset by the same $1.4 million home mortgage loan returning to accrual status as discussed above.
Deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
As of |
|
|
|||||||||||||||||||||
|
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
|
% Change 4Q2025 vs. |
|||||||||||||||||
| ($ in thousands) |
|
Amount |
|
% |
|
Amount |
|
% |
|
Amount |
|
% |
|
3Q2025 |
|
4Q2024 |
||||||||
|
Noninterest-bearing deposits |
|
$ |
520,865 |
|
23 |
% |
|
$ |
543,972 |
|
24 |
% |
|
$ |
504,928 |
|
25 |
% |
|
(4 |
)% |
|
3 |
% |
|
Money market deposits and others |
|
|
388,066 |
|
17 |
|
|
|
402,891 |
|
18 |
|
|
|
329,095 |
|
16 |
|
|
(4 |
) |
|
18 |
|
|
Time deposits |
|
|
1,371,616 |
|
60 |
|
|
|
1,326,554 |
|
58 |
|
|
|
1,193,262 |
|
59 |
|
|
3 |
|
|
15 |
|
|
Total deposits |
|
$ |
2,280,547 |
|
100 |
% |
|
$ |
2,273,417 |
|
100 |
% |
|
$ |
2,027,285 |
|
100 |
% |
|
0 |
% |
|
12 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Estimated uninsured deposits |
|
$ |
1,093,843 |
|
48 |
% |
|
$ |
1,131,091 |
|
50 |
% |
|
$ |
961,687 |
|
47 |
% |
|
(3 |
)% |
|
14 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2025 vs. September 30, 2025
Total deposits increased by $7.1 million, primarily driven by a $45.1 million increase in time deposits, partially offset by a $23.1 million decrease in noninterest-bearing deposits, and a $14.8 million decrease in money market deposits and others. The increase in time deposits reflects new retail customers opening CD accounts and a rise in wholesale CD balances to support loan growth. The declines in noninterest-bearing and money market deposits were primarily attributable to reductions in existing customer balances, reflecting customers’ liquidity and investment preferences.
As of December 31, 2025 vs. December 31, 2024
Total deposits increased by $253.3 million or 12%, primarily driven by growth of $178.4 million in time deposits and $59.0 million in money market deposits and others. The increase in time deposits was largely due to new customers opening CD accounts, reflecting a preference for higher-yielding products, along with higher wholesale CD balances. Similarly, the expansion in money market deposits and others was mainly driven by inflows from new customers and increased wholesale money market balances.
The following table sets forth the maturity of time deposits as of December 31, 2025:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
As of December 31, 2025 |
||||||||||||||||||||||
|
($ in thousands) |
|
Within Three Months |
|
Three to Six Months |
|
Six to Nine Months |
|
Nine to Twelve Months |
|
After Twelve Months |
|
Total |
||||||||||||
|
Time deposits (greater than $250) |
|
$ |
319,815 |
|
|
$ |
119,285 |
|
|
$ |
94,984 |
|
|
$ |
148,957 |
|
|
$ |
915 |
|
|
$ |
683,956 |
|
|
Time deposits ($250 or less) |
|
|
323,978 |
|
|
|
141,651 |
|
|
|
121,394 |
|
|
|
98,862 |
|
|
|
1,775 |
|
|
|
687,660 |
|
|
Total time deposits |
|
$ |
643,793 |
|
|
$ |
260,936 |
|
|
$ |
216,378 |
|
|
$ |
247,819 |
|
|
$ |
2,690 |
|
|
$ |
1,371,616 |
|
|
Weighted average rate |
|
|
4.10 |
% |
|
|
4.20 |
% |
|
|
4.18 |
% |
|
|
4.01 |
% |
|
|
2.47 |
% |
|
|
4.11 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
OTHER HIGHLIGHTS
Liquidity
The Company maintains ample access to liquidity, including highly liquid assets on our balance sheet and available unused borrowings from other financial institutions. The following table presents the Company’s liquid assets and available borrowings as of dates presented:
|
|
|
|
|
|
||||||||
|
($ in thousands) |
|
4Q2025 |
|
3Q2025 |
|
4Q2024 |
||||||
|
Liquidity Assets: |
|
|
|
|
|
|
||||||
|
Cash and cash equivalents |
|
$ |
167,311 |
|
|
$ |
166,748 |
|
|
$ |
134,943 |
|
|
Available-for-sale (“AFS”) debt securities |
|
|
192,785 |
|
|
|
200,760 |
|
|
|
185,909 |
|
|
Liquid assets |
|
$ |
360,096 |
|
|
$ |
367,508 |
|
|
$ |
320,852 |
|
|
Liquid assets to total assets |
|
|
14 |
% |
|
|
14 |
% |
|
|
14 |
% |
|
|
|
|
|
|
|
|
||||||
|
Available Borrowings: |
|
|
|
|
|
|
||||||
|
Federal Home Loan Bank (“FHLB”) —San Francisco |
|
$ |
443,629 |
|
|
$ |
430,887 |
|
|
$ |
401,900 |
|
|
Federal Reserve Bank |
|
|
208,859 |
|
|
|
210,584 |
|
|
|
215,115 |
|
|
Pacific Coast Bankers Bank |
|
|
50,000 |
|
|
|
50,000 |
|
|
|
50,000 |
|
|
Zions Bank |
|
|
25,000 |
|
|
|
25,000 |
|
|
|
25,000 |
|
|
First Horizon Bank |
|
|
25,000 |
|
|
|
25,000 |
|
|
|
25,000 |
|
|
Total available borrowings |
|
$ |
752,488 |
|
|
$ |
741,471 |
|
|
$ |
717,015 |
|
|
Total available borrowings to total assets |
|
|
28 |
% |
|
|
28 |
% |
|
|
30 |
% |
|
|
|
|
|
|
|
|
||||||
|
Liquid assets and available borrowings to total deposits |
|
|
49 |
% |
|
|
49 |
% |
|
|
51 |
% |
|
|
|
|
|
|
||||||||
Contacts
Investor Relations
OP Bancorp
Jaehyun Park
EVP & CFO
213.593.4865
[email protected]
