Hope Bancorp Reports Q2 Loss Amid Merger Expenses, Dividend Yield at 5%

Hope Bancorp reported a loss for Q2 2025 due to one-time merger-related expenses and a decline in earnings. The company acquired Territorial Bancorp in 2025. Despite a 5%+ dividend yield, the stock is fairly valued.

Hope Bancorp, Inc. (NASDAQ: HOPE) reported a loss for the second quarter of 2025, primarily due to one-time merger-related expenses and the sale of low-yielding Available-for-Sale securities at a loss of $39 million [1]. The company’s earnings were also affected by the acquisition of Territorial Bancorp, which added a new state to its diverse footprint but also introduced additional expenses.

Despite the challenges, Hope Bancorp has maintained a 5.4% dividend yield, making it an attractive option for income-seeking investors [1]. The company’s loan book increased by 8.3% in Q2’25, largely due to the acquisition, although the tourism slowdown in Hawaii has negatively impacted its operations in that state [1].

The company’s net interest margin improved by 15 basis points in Q2’25, primarily due to the repositioning of its securities portfolio and the acquisition of Territorial Bancorp [1]. The management expects the net interest margin to grow by an additional 4 basis points in the second half of 2025, despite potential Fed funds rate cuts.

Looking ahead, Hope Bancorp is expected to report an EPS of $0.45 for 2025, with normalized EPS of $0.60 [1]. The company’s dividend is well-covered by its earnings, with an implied payout ratio of 123% for 2025 [1]. Despite the recent loss, analysts suggest that the stock is fairly valued, with a target price of $9.6, which is 7.1% below the current market price [1].

References:
[1] https://seekingalpha.com/article/4814240-hope-bancorp-over-5-percent-dividend-yield-but-stock-seems-fairly-valued
[2] https://simplywall.st/stocks/us/banks/nasdaq-hope/hope-bancorp