Hanmi delays its quarterly results
Hanmi Financial Corp., the largest bank catering to Korean Americans, said Wednesday it would delay its earnings report because of more troubled loans than expected, sending its stock plunging 23%.
The Los Angeles-based community bank pushed the date for its third-quarter financial report from today to Nov. 6. It said it needed “additional time to determine the appropriate level” of the allowance on its balance sheet for future loan losses.
Hanmi said Wednesday that it expected its third-quarter provision for credit losses to be at least $7.5 million, more than quadruple the amount the bank added to its loan-loss allowance in the third quarter of 2006.
The company said the loss provision would drive its earnings per share down by at least 20% from the 31 cents posted for the 2006 quarter.
Hanmi Chief Executive Sung Won Sohn couldn’t be reached for comment.
Shares of Hanmi tumbled $3.47 to $11.37 on Wednesday. The stock is down 50% this year.
Like many of the ethnically focused banks that have sprung up in culturally diverse Southern California, Hanmi specializes in business banking, including commercial real estate and Small Business Administration loans, along with trade finance.
Credit troubles began cropping up early this year at Korean American banks, which have faced increasing competition from mainstream banks such as Bank of America Corp. and Wells Fargo & Co.
“There is too much money chasing too few good loans,” said FTN Midwest Research analyst Brett Rabatin.
The banks have denied that the greater competition has led them to loosen their lending standards and have described their balance sheets as fundamentally sound.
Another banking firm based in L.A.’s Koreatown, Nara Bancorp, on Tuesday reported largely flat third-quarter net income of $8.8 million, or 33 cents a share. The company recorded a $1.6-million loan-loss provision in the latest quarter, up from $1.2 million a year earlier.
Two other Koreatown-based banking companies, Wilshire Bancorp Inc. and Center Financial Corp., are scheduled to report earnings today.
