Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________

FORM 8-K

____________________________________

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 24, 2024

____________________________________

OP BANCORP

(Exact name of registrant as specified in its charter)

____________________________________


California	001-38437	81-3114676
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1000 Wilshire Blvd, Suite 500, Los Angeles, CA		90017
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (213) 892-9999

Not Applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2 below):


☐			Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐			Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, No Par Value

OPBK

NASDAQ Global Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Item 2.02 Results of Operations and Financial Condition

On October 24, 2024, OP Bancorp, (the “Company”), the holding company of Open Bank, issued a press release announcing preliminary unaudited results for the third quarter ended September 30, 2024. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. Also attached as Exhibit 99.3 is a slide presentation for the results for the third quarter.

The information in this Current Report set forth under this Item 2.02, including the exhibit hereto, shall not be treated as “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (“Exchange Act”), nor shall it be deemed incorporated by reference into any registration statement or other filing pursuant to the Securities Act of 1933, as amended, or the Exchange Act, except as expressly stated by specific reference in such filing.

Item 7.01 Regulation FD

On October 24, 2024, the registrant issued a press release announcing that its Board of Directors had declared a cash dividend of $0.12 per common share, payable on or about November 21, 2024, to holders of record as of November 7, 2024. A copy of that release is furnished as Exhibit 99.2 of this Current Report.

On October 24, 2024, the registrant disclosed its investor presentation for the third quarter of 2024. A copy of that presentation is furnished as Exhibit 99.3 of this Current Report.

The information disclosed in response to this Item 7.01, including the exhibits identified herein and the contents thereof, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities under that section and shall not be deemed to be incorporated by reference into any document filed under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits.


Exhibit Number						Exhibit Description
99.1						Press Release, dated O ctober 24 , 2024, of OP Bancorp entitled “OP Bancorp Reports Net Income for 2024 Third Quarter of $5.4 Million and Diluted Earnings Per Share of $0.36

99.2						Press Release, dated Oc t ober 24 , 2024, of OP Bancorp entitled “OP Bancorp Declares Quarterly Cash Dividend of $0.12 Per Share

99.3						Earnings Presentation, 2024 Third Quarter

104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	OP Bancorp

Date: October 24, 2024	By:	/s/ Christine Oh
		Christine Oh
		Executive Vice President and
		Chief Financial Officer

Exhibit 99.1

OP BANCORP REPORTS NET INCOME FOR 2024 THIRD QUARTER

OF $5.4 MILLION AND DILUTED EARNINGS PER SHARE OF $0.36

2024 Third Quarter Highlights compared with 2024 Second Quarter:

•Financial Results:

◦Net income of $5.4 million, no change compared to $5.4 million

◦Diluted earnings per share of $0.36, no change compared to $0.36

◦Net interest income of $16.5 million, compared to $16.2 million

◦Net interest margin of 2.95%, compared to 2.96%

◦Provision for credit losses of $448 thousand, compared to $617 thousand

◦Total assets of $2.39 billion, a 4.2% increase compared to $2.29 billion

◦Gross loans of $1.93 billion, a 3.3% increase compared to $1.87 billion

◦Total deposits of $2.06 billion, a 6.4% increase compared to $1.94 billion

•Credit Quality:

◦Allowance for credit losses to gross loans of 1.19%, compared to 1.22%

◦Net charge-offs (recoveries)(1) to average gross loans(2) of 0.01%, compared to (0.00)%

◦Loans past due 30-89 days to gross loans of 0.53%, compared to 0.36%

◦Nonperforming loans to gross loans of 0.19%, compared to 0.23%

◦Criticized loans(3) to gross loans of 0.85%, compared to 0.88%

•Capital Levels:

◦Remained well-capitalized with a Common Equity Tier 1 (“CET1”) ratio of 11.57%

◦Book value per common share increased to $13.75, compared to $13.23

◦Repurchased 4,610 shares of common stock at an average price of $10.09 per share

◦Paid quarterly cash dividend of $0.12 per share for the periods

___________________________________________________________

(1) Annualized.

(2) Includes loans held for sale.

(3) Includes special mention, substandard, doubtful, and loss categories.

LOS ANGELES, October 24, 2024 — OP Bancorp (the “Company”) (NASDAQ: OPBK), the holding company of Open Bank (the “Bank”), today reported its financial results for the third quarter of 2024. Net income remained relatively the same for both the third quarter and second quarter of 2024 at $5.4 million, or $0.36 per diluted common share, compared with $5.1 million, or $0.33 per diluted common share, for the third quarter of 2023.

Min Kim, President and Chief Executive Officer:

“We continued to grow our loans and deposits at double digit annualized rates in this quarter while maintaining ample liquidity, stable net interest margin, and strong credit quality. As the Fed's easing cycle began in the quarter, the pressure on funding cost and net interest margin is diminishing, and we believe we are well positioned to prolong our growth and performance to achieve our long term strategic goals ,” said Min Kim, President and Chief Executive.

SELECTED FINANCIAL HIGHLIGHTS



($ in thousands, except per share data)	As of and For the Quarter									% Change 3Q2024 vs.
	3Q2024			2Q2024			3Q2023			2Q2024		3Q2023
Selected Income Statement Data:
Net interest income	$	16,506		$	16,194		$	17,313		1.9	%	(4.7)	%
Provision for credit losses	448			617			1,359			(27.4)		(67.0)
Noninterest income	4,240			4,184			2,601			1.3		63.0
Noninterest expense	12,720			12,189			11,535			4.4		10.3
Income tax expense	2,142			2,136			1,899			0.3		12.8
Net income	5,436			5,436			5,121			—		6.2
Diluted earnings per share	0.36			0.36			0.33			—		9.1
Selected Balance Sheet Data:
Gross loans	$	1,931,007		$	1,870,106		$	1,759,525		3.3	%	9.7	%
Total deposits	2,064,603			1,940,821			1,825,171			6.4		13.1
Total assets	2,387,980			2,290,680			2,142,675			4.2		11.4
Average loans(1)	1,905,952			1,843,284			1,740,188			3.4		9.5
Average deposits	1,998,633			1,970,320			1,821,361			1.4		9.7
Credit Quality:
Nonperforming loans	$	3,620		$	4,389		$	4,211		(17.5)	%	(14.0)	%
Nonperforming loans to gross loans	0.19		%	0.23		%	0.24		%	(0.04)		(0.05)
Criticized loans(2) to gross loans	0.85			0.88			0.78			(0.03)		0.07
Net charge-offs (recoveries)(3) to average gross loans(1)	0.01			(0.00)			0.11			0.01		(0.10)
Allowance for credit losses to gross loans	1.19			1.22			1.23			(0.03)		(0.04)
Allowance for credit losses to nonperforming loans	634			519			513			115.00		121.00
Financial Ratios:
Return on average assets(3)	0.94		%	0.95		%	0.96		%	(0.01)	%	(0.02)	%
Return on average equity(3)	10.95			11.23			11.07			(0.28)		(0.12)
Net interest margin(3)	2.95			2.96			3.38			(0.01)		(0.43)
Efficiency ratio(4)	61.31			59.81			57.92			1.50		3.39
Common equity tier 1 capital ratio	11.57			12.01			12.09			(0.44)		(0.52)
Leverage ratio	9.30			9.28			9.63			0.02		(0.33)
Book value per common share	$	13.75		$	13.23		$	12.17		3.9		13.0

(1)Includes loans held for sale.

(2)Includes special mention, substandard, doubtful, and loss categories.

(3)Annualized.

(4)Represents noninterest expense divided by the sum of net interest income and noninterest income.

INCOME STATEMENT HIGHLIGHTS

Net Interest Income and Net Interest Margin



($ in thousands)	For the Three Months Ended						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
Interest Income
Interest income	$	35,299	$	34,357	$	31,186	2.7	%	13.2	%
Interest expense	18,793		18,163		13,873		3.5		35.5
Net interest income	$	16,506	$	16,194	$	17,313	1.9	%	(4.7)	%



($ in thousands)	For the Three Months Ended												Yield Change 3Q2024 vs.
	3Q2024				2Q2024				3Q2023
	Interest and Fees		Yield/Rate(1)		Interest and Fees		Yield/Rate(1)		Interest and Fees		Yield/Rate(1)		2Q2024		3Q2023
Interest-earning Assets:
Loans	$	31,885	6.66	%	$	30,605	6.67	%	$	28,250	6.45	%	(0.01)	%	0.21	%
Total interest-earning assets	35,299		6.30		34,357		6.29		31,186		6.08		0.01		0.22
Interest-bearing Liabilities:
Interest-bearing deposits	17,921		4.85		17,343		4.84		13,006		4.22		0.01		0.63
Total interest-bearing liabilities	18,793		4.82		18,163		4.81		13,873		4.23		0.01		0.59
Ratios:
Net interest income / interest rate spreads	16,506		1.48		16,194		1.48		17,313		1.85		—		(0.37)
Net interest margin			2.95				2.96				3.38		(0.01)		(0.43)
Total deposits / cost of deposits	17,921		3.57		17,343		3.54		13,006		2.83		0.03		0.74
Total funding liabilities / cost of funds	18,793		3.60		18,163		3.57		13,873		2.90		0.03		0.70

(1)Annualized.



($ in thousands)	For the Three Months Ended												Yield Change 3Q2024 vs.
	3Q2024				2Q2024				3Q2023
	Interest & Fees		Yield(1)		Interest & Fees		Yield(1)		Interest & Fees		Yield(1)		2Q2024		3Q2023
Loan Yield Component:
Contractual interest rate	$	31,182	6.52	%	$	29,719	6.48	%	$	27,319	6.24	%	0.04	%	0.28	%
Accretion of SBA loan discount(2)	918		0.19		1,087		0.24		1,263		0.29		(0.05)		(0.10)
Amortization of net deferred fees	23		—		(44)		(0.01)		1		—		0.01		—
Amortization of premium	(487)		(0.10)		(396)		(0.09)		(445)		(0.10)		(0.01)		—
Net interest recognized on nonaccrual loans	(61)		(0.01)		(3)		0.00		(26)		(0.01)		(0.01)		—
Prepayment penalty income and other fees(3)	310		0.06		242		0.05		138		0.03		0.01		0.03
Yield on loans	$	31,885	6.66	%	$	30,605	6.67	%	$	28,250	6.45	%	(0.01)	%	0.21	%

(1)Annualized.

(2)Includes discount accretion from SBA loan payoffs of $426 thousand, $564 thousand and $666 thousand for the three months ended September 30, 2024, June 30, 2024 and September 30, 2023, respectively.

(3)Includes prepayment penalty income of $114 thousand and $26 thousand for the three months ended September 30, 2024 and June 30, 2024, respectively, from Commercial Real Estate (“CRE”) loans.

Third Quarter 2024 vs. Second Quarter 2024

Net interest income increased $312 thousand, or 1.9%, primarily due to higher interest income on loans but partially offset by higher interest expense on interest-bearing deposits and lower interest income on interest-bearing deposits in other banks. Net interest margin was 2.95%, a decrease of 1 basis point from 2.96%.

◦A $1.3 million increase in interest income on loans was primarily due to a $62.7 million, or 3.4%, increase in average balance.

◦A $578 thousand increase in interest expense on interest-bearing deposits was primarily due to a $29.4 million, or 2.0%, increase in average balance.

◦A $373 thousand decrease in interest income on interest-bearing deposits in other banks was primarily due to a $27.0 million, or 19.8%, decrease in average balance.

Third Quarter 2024 vs. Third Quarter 2023

Net interest income decreased $807 thousand, or 4.7%, primarily due to higher interest expense on interest-bearing deposits, partially offset by higher interest income on loans and higher interest-bearing deposits in other banks, as our deposit costs repriced quicker than our interest-earning asset yields following the Federal Reserve’s rate increases. Net interest margin was 2.95%, a decrease of 43 basis points from 3.38%.

◦A $4.9 million increase in interest expense on interest-bearing deposits was primarily due to a $248.4 million, or 20.3%, increase in average balance and a 63 basis point increase in average cost.

◦A $3.6 million increase in interest income on loans was primarily due to a $165.8 million, or 9.5%, increase in average balance and a 21 basis point increase in average yield.

◦A $358 thousand increase in interest income on interest-bearing deposits in other banks was primarily due to a $26.3 million, or 31.7%, increase in average balance.

Provision for Credit Losses



($ in thousands)	For the Three Months Ended
	3Q2024		2Q2024		3Q2023
Provision for credit losses on loans	$	234	$	627	$	1,303
Provision for (reversal of) credit losses on off-balance sheet exposure	214		(10)		56
Total provision for credit losses	$	448	$	617	$	1,359

Third Quarter 2024 vs. Second Quarter 2024

The Company recorded $448 thousand in total provision for credit losses, a decrease of $169 thousand, compared with $617 thousand. Provision for credit losses on loans decreased $393 thousand and provision for credit losses on off-balance sheet exposure increased $224 thousand.

Provision for credit losses on loans of $234 thousand was primarily due to a $215 thousand increase in the qualitative reserve driven by declining collateral values for collateral dependent CRE loans and weakening economic and business conditions.

Provision for credit losses on off-balance sheet exposure of $214 thousand was primarily due to increases in unfunded commitment balance and utilization of commitment.

Third Quarter 2024 vs. Third Quarter 2023

The Company recorded $448 thousand in total provision for credit losses, a decrease of $911 thousand, compared with $1.4 million.

Noninterest Income



($ in thousands)	For the Three Months Ended						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
Noninterest Income
Service charges on deposits	$	889	$	793	$	575	12.1	%	54.6	%
Loan servicing fees, net of amortization	693		575		468		20.5		48.1
Gain on sale of loans	2,088		2,325		1,179		(10.2)		77.1
Other income	570		491		379		16.1		50.4
Total noninterest income	$	4,240	$	4,184	$	2,601	1.3	%	63.0	%

Third Quarter 2024 vs. Second Quarter 2024

Noninterest income increased $56 thousand, or 1.3%, primarily due to higher loan servicing fees and higher service charges on deposits, partially offset by lower gain on the sale of loans.

◦Loan servicing fees, net of amortization, were $693 thousand, an increase of $118 thousand from $575 thousand, primarily due to a decrease in servicing fee amortization driven by lower loan payoffs in loan servicing portfolio.

◦Service charges on deposits were $889 thousand, an increase of $96 thousand from $793 thousand, primarily due to an increase in deposit analysis fees from analysis accounts added in 2024.

◦Gain on sale of loans was $2.1 million, a decrease of $237 thousand from $2.3 million, primarily due to a lower average premium on sales. The Bank sold $35.6 million in SBA loans at an average premium rate of 7.30%, compared to the sale of $32.1 million at an average premium rate of 8.58%.

Third Quarter 2024 vs. Third Quarter 2023

Noninterest income increased $1.6 million, or 63.0%, primarily due to higher gain on sale of loans, higher service charges on deposits, and higher loan servicing fees.

◦Gain on sale of loans was $2.1 million, an increase of $909 thousand from $1.2 million, primarily due to a higher loan sold amount and a higher average premium rate. The Bank sold $35.6 million in SBA loans at an average premium rate of 7.30%, compared to the sale of $23.4 million at an average premium rate of 6.50%.

◦Service charges on deposits were $889 thousand, an increase of $314 thousand from $575 thousand, primarily due to an increase in deposit analysis fees from an increase in the number of analysis accounts.

◦Loan servicing fees were $693 thousand, an increase of $225 thousand from $468 thousand, primarily due to a decrease in servicing fee amortization driven by lower loan payoffs in loan servicing portfolio.

Noninterest Expense



($ in thousands)	For the Three Months Ended						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
Noninterest Expense
Salaries and employee benefits	$	8,031	$	7,568	$	7,014	6.1	%	14.5	%
Occupancy and equipment	1,676		1,660		1,706		1.0		(1.8)
Data processing and communication	634		530		369		19.6		71.8
Professional fees	346		406		440		(14.8)		(21.4)
FDIC insurance and regulatory assessments	391		378		333		3.4		17.4
Promotion and advertising	151		151		207		—		(27.1)
Directors’ fees	154		178		164		(13.5)		(6.1)
Foundation donation and other contributions	549		539		529		1.9		3.8
Other expenses	788		779		773		1.2		1.9
Total noninterest expense	$	12,720	$	12,189	$	11,535	4.4	%	10.3	%

Third Quarter 2024 vs. Second Quarter 2024

Noninterest expense increased $531 thousand, or 4.4%, primarily due to higher salaries and employee benefits, and data processing and communication.

◦Salaries and employee benefits increased $463 thousand, primarily due to increases in employee incentive accruals and employee vacation accruals.

◦Data processing and communication increased $104 thousand, primarily due to accrual adjustments made to be in line with our continued growth.

Third Quarter 2024 vs. Third Quarter 2023

Noninterest expense increased $1.2 million, or 10.3%, primarily due to higher salaries and employee benefits, and data processing and communication.

◦Salaries and employee benefits increased $1.0 million, primarily due to increases in salaries and employee benefits to support our growth and a lower accrual on employee incentives in the third quarter of 2023.

◦Data processing and communication increased $265 thousand, primarily due to additional expense to support our continued growth and a lower expense in the third quarter of 2023 from a credit received on data processing fees.

Income Tax Expense

Third Quarter 2024 vs. Second Quarter 2024

Income tax expense was $2.1 million, resulting in an effective tax rate of 28.3%, compared to income tax expense of $2.1 million, resulting in an effective tax rate of 28.2%.

Third Quarter 2024 vs. Third Quarter 2023

Income tax expense was $2.1 million, resulting in an effective tax rate of 28.3%, compared to income tax expense of $1.9 million, resulting in an effective tax rate of 27.1%. The effective tax rate for the third quarter of 2023 was lower primarily due to adjustments for differences between the prior year tax provision and the final tax returns that were applied in the quarter.

BALANCE SHEET HIGHLIGHTS

Loans



($ in thousands)	As of						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
CRE loans	$	966,472	$	931,284	$	878,824	3.8	%	10.0	%
SBA loans	252,379		242,395		240,154		4.1		5.1
C&I loans	212,476		188,557		124,632		12.7		70.5
Home mortgage loans	499,666		506,873		515,789		(1.4)		(3.1)
Consumer & other loans	14		997		126		(98.6)		(88.9)
Gross loans	$	1,931,007	$	1,870,106	$	1,759,525	3.3	%	9.7	%

The following table presents new loan originations based on loan commitment amounts for the periods indicated:



($ in thousands)	For the Three Months Ended						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
CRE loans	$	68,525	$	41,990	$	33,222	63.2	%	106.3	%
SBA loans	46,302		24,142		39,079		91.8		18.5
C&I loans	27,771		21,271		14,617		30.6		90.0
Home mortgage loans	10,105		13,720		9,137		(26.3)		10.6

Gross loans	$	152,703	$	101,123	$	96,055	51.0	%	59.0	%

The following table presents changes in gross loans by loan activity for the periods indicated:



($ in thousands)	For the Three Months Ended
	3Q2024		2Q2024		3Q2023
Loan Activities:
Gross loans, beginning	$	1,870,106	$	1,804,987	$	1,716,197
New originations	152,703		101,123		96,055
Net line advances	(526)		37,929		22,146
Purchases	862		5,559		6,732
Sales	(35,576)		(32,102)		(23,377)
Paydowns	(24,798)		(19,710)		(22,169)
Payoffs	(29,642)		(36,902)		(36,024)

Decrease (increase) in loans held for sale	(1,674)		9,590		—
Other	(448)		(368)		215
Total	60,901		65,119		43,328
Gross loans, ending	$	1,931,007	$	1,870,106	$	1,759,525

As of September 30, 2024 vs. June 30, 2024

Gross loans were $1.93 billion as of September 30, 2024, up $60.9 million from June 30, 2024, primarily due to new loan originations, partially offset by loan sales, payoffs and paydowns. New loan originations, loan sales, and loan payoffs and paydowns were $152.7 million, $35.6 million, and $54.4 million, respectively, for the third quarter of 2024, compared with $101.1 million, $32.1 million, and $56.6 million, respectively, for the second quarter of 2024.

As of September 30, 2024 vs. September 30, 2023

Gross loans were $1.93 billion as of September 30, 2024, up $171.5 million, from September 30, 2023, primarily due to and increase in new loan originations of $472.3 million, partially offset by loan sales of $132.6 million and loan payoffs and paydowns of $214.9 million.

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:



($ in thousands)	As of
	3Q2024				2Q2024				3Q2023
	%		Rate		%		Rate		%		Rate
Fixed rate	35.7	%	5.42	%	36.2	%	5.39	%	36.3	%	4.95	%
Hybrid rate	34.7		5.60		33.9		5.42		34.0		5.08
Variable rate	29.6		8.94		29.9		9.19		29.7		9.23
Gross loans	100.0	%	6.52	%	100.0	%	6.54	%	100.0	%	6.27	%

The following table presents the maturity of gross loans by interest rate type accompanied with the weighted average contractual rates for the periods indicated:



($ in thousands)	As of September 30, 2024
	Within One Year				One Year Through Five Years				After Five Years				Total
	Amount		Rate		Amount		Rate		Amount		Rate		Amount		Rate
Fixed rate	$	191,036	5.96	%	$	282,324	5.27	%	$	216,044	5.13	%	$	689,404	5.42	%
Hybrid rate	2,651		9.25		211,150		4.39		456,362		6.14		670,163		5.60
Variable rate	87,435		8.47		139,453		8.57		344,552		9.21		571,440		8.94
Gross loans	$	281,122	6.77	%	$	632,927	5.71	%	$	1,016,958	6.97	%	$	1,931,007	6.52	%

Allowance for Credit Losses

The following table presents allowance for credit losses and provision for credit losses as of and for the periods presented:



($ in thousands)	As of and For the Three Months Ended						Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
Allowance for credit losses on loans, beginning	$	22,760	$	22,129	$	20,802	$	631	$	1,958
Provision for credit losses	234		627		1,303		(393)		(1,069)
Gross charge-offs	(40)		—		(492)		(40)		452
Gross recoveries	6		4		4		2		2
Net (charge-offs) recoveries	(34)		4		(488)		(38)		454
Allowance for credit losses on loans, ending	$	22,960	$	22,760	$	21,617	$	200	$	1,343

Allowance for credit losses on off-balance sheet exposure, beginning	$	458	$	468	$	367	$	(10)	$	91
Provision for (reversal of) credit losses	214		(10)		56		224		158
Allowance for credit losses on off-balance sheet exposure, ending	$	672	$	458	$	423	$	214	$	249

Asset Quality



($ in thousands)	As of and For the Three Months Ended									Change 3Q2024 vs.
	3Q2024			2Q2024			3Q2023			2Q2024		3Q2023
Loans 30-89 days past due and still accruing	$	10,306		$	6,652		$	8,356		54.9	%	23.3	%
As a % of gross loans	0.53		%	0.36		%	0.47		%	0.17		0.06

Nonperforming loans(1)	$	3,620		$	4,389		$	4,211		(17.5)	%	(14.0)	%
Nonperforming assets(1)	4,857			5,626			4,211			(13.7)		15.3
Nonperforming loans to gross loans	0.19		%	0.23		%	0.24		%	(0.04)		(0.05)
Nonperforming assets to total assets	0.20			0.25			0.20			(0.05)		—

Criticized loans(1)(2)	$	16,500		$	16,428		$	13,790		0.4	%	19.7	%
Criticized loans to gross loans	0.85		%	0.88		%	0.78		%	(0.03)		0.07

Allowance for credit losses ratios:
As a % of gross loans	1.19		%	1.22		%	1.23		%	(0.03)	%	(0.04)	%
As a % of nonperforming loans	634			519			513			115		121
As a % of nonperforming assets	473			405			513			68		(40)
As a % of criticized loans	139			139			157			—		(18)
Net charge-offs (recoveries)(3) to average gross loans(4)	0.01			(0.00)			0.11			0.01		(0.10)

(1)Excludes the guaranteed portion of SBA loans that are in liquidation totaling $11.1 million, $3.5 million and $5.2 million as of September 30, 2024, June 30, 2024 and September 30, 2023, respectively.

(2)Consists of special mention, substandard, doubtful and loss categories.

(3)Annualized.

(4)Includes loans held for sale.

Overall, the Bank continued to maintain low levels of nonperforming loans and net charge-offs. Our allowance remained strong with an allowance to gross loans ratio of 1.19%.

◦Loans 30-89 days past due and still accruing were $10.3 million or 0.53% of gross loans as of September 30, 2024, compared with $6.7 million or 0.36% as of June 30, 2024. The increase was largely due to four home mortgage loans totaling $2.4 million and three SBA real estate loans totaling $1.3 million.

◦Nonperforming loans were $3.6 million or 0.19% of gross loans as of September 30, 2024, compared with $4.4 million or 0.23% as of June 30, 2024.

◦Nonperforming assets were $4.9 million or 0.20% of total assets as of September 30, 2024, compared with $5.6 million or 0.25% as of June 30, 2024. OREO remained the same at $1.2 million as of September 30, 2024 and June 30, 2024, which is secured by a mix-use property in Los Angeles Koreatown with 90% guaranteed by SBA.

◦Criticized loans were $16.5 million or 0.85% of gross loans as of September 30, 2024, compared with $16.4 million or 0.88% as of June 30, 2024.

◦Net charge-offs were $34 thousand or 0.01% of average loans in the third quarter of 2024, compared to net recoveries of $4 thousand, or 0.00% of average loans in the second quarter

of 2024 and net recoveries of $488 thousand, or 0.11% of average loans in the third quarter of 2023.

Deposits



($ in thousands)	As of												% Change 3Q2024 vs.
	3Q2024				2Q2024				3Q2023
	Amount		%		Amount		%		Amount		%		2Q2024		3Q2023
Noninterest-bearing deposits	$	561,801	27.2	%	$	518,456	26.7	%	$	605,509	33.2	%	8.4	%	(7.2)	%
Money market deposits and others	343,188		16.6		332,137		17.1		348,869		19.1		3.3		(1.6)
Time deposits	1,159,614		56.2		1,090,228		56.2		870,793		47.7		6.4		33.2
Total deposits	$	2,064,603	100.0	%	$	1,940,821	100.0	%	$	1,825,171	100.0	%	6.4	%	13.1	%

Estimated uninsured deposits	$	946,406	45.8	%	$	860,419	44.3	%	$	808,776	44.3	%	10.0	%	17.0	%

As of September 30, 2024 vs. June 30, 2024

Total deposits were $2.06 billion as of September 30, 2024, reflecting an increase of $123.8 million from June 30, 2024, primarily due to increases of $69.4 million in time deposits and $43.3 million in noninterest-bearing deposits. Customers’ preference for high-rate deposit products continued to drive the increase in time deposits. The increase in noninterest-bearing deposits was mostly driven by balance increases in existing customers, including escrow and 1031 exchanges accounts. The composition of noninterest-bearing deposits also increased to 27.2% of total deposits from 26.7%.

As of September 30, 2024 vs. September 30, 2023

Total deposits were $2.06 billion as of September 30, 2024, up $239.4 million from September 30, 2023, primarily driven by a $288.8 million increase in time deposits, offset by decreases of $43.7 million in noninterest-bearing deposits and $5.7 million in money market deposits. Noninterest-bearing deposits, as a percentage of total deposits, decreased to 27.2% from 33.2%. The composition shift to time deposits was primarily due to customers’ preference for high-rate deposit products driven by market rate increases as a result of the Federal Reserve’s rate increases.

The following table sets forth the maturity of time deposits as of September 30, 2024:



	As of September 30, 2024
($ 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)	$	205,957		$	189,693		$	87,508		$	80,133		$	1,256		$	564,547
Time deposits ($250 or less)	261,163			124,315			97,180			92,585			19,824			595,067
Total time deposits	$	467,120		$	314,008		$	184,688		$	172,718		$	21,080		$	1,159,614
Weighted average rate	5.18		%	5.03		%	5.16		%	4.93		%	3.94		%	5.08		%

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)	3Q2024			2Q2024			3Q2023
Liquidity Assets:
Cash and cash equivalents	$	166,756		$	127,676		$	105,740
Available-for-sale debt securities	199,373			199,205			191,313
Liquid assets	$	366,129		$	326,881		$	297,053
Liquid assets to total assets	15.3		%	14.3		%	13.9		%

Available borrowings:
Federal Home Loan Bank—San Francisco	$	397,617		$	343,600		$	375,874
Federal Reserve Bank	207,782			191,421			186,380
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	$	705,399		$	635,021		$	662,254
Total available borrowings to total assets	29.5		%	27.6		%	30.9		%

Liquid assets and available borrowings to total deposits	51.9		%	49.6		%	52.6		%

Capital and Capital Ratios

On October 24, 2024, the Company’s Board of Directors declared a quarterly cash dividend of $0.12 per share of its common stock. The cash dividend is payable on or about November 21, 2024 to all shareholders of record as of the close of business on November 7, 2024. The payment of the dividend is based primarily on dividends from the Bank to the Company, and future dividends will depend on the

Board’s assessment of the availability of capital levels to support the ongoing operating capital needs of both the Company and the Bank.

The Company also repurchased 4,610 shares of its common stock at an average price of $10.09 per share during the third quarter of 2024 under the stock repurchase program announced in August 2023. Since the announcement of the stock repurchase program in August 2023, the Company repurchased a total of 428,628 shares of its common stock at an average repurchase price of $9.37 per share through September 30, 2024.



	OP Bancorp(1)		Open Bank		Minimum Well Capitalized Ratio		Minimum Capital Ratio+ Conservation Buffer(2)
Risk-Based Capital Ratios:
Total risk-based capital ratio	12.79	%	12.69	%	10.00	%	10.50	%
Tier 1 risk-based capital ratio	11.57		11.47		8.00		8.50
Common equity tier 1 ratio	11.57		11.47		6.50		7.00
Leverage ratio	9.30		9.22		5.00		4.00

(1)The capital requirements are only applicable to the Bank, and the Company's ratios are included for comparison purpose.

(2)An additional 2.5% capital conservation buffer above the minimum capital ratios are required in order to avoid limitations on distributions, including dividend payments and certain discretionary bonuses to executive officers.



OP Bancorp										Change 3Q2024 vs.
	3Q2024			2Q2024			3Q2023			2Q2024		3Q2023
Risk-Based Capital Ratios:
Total risk-based capital ratio	12.79		%	13.26		%	13.31		%	(0.47)	%	(0.52)	%
Tier 1 risk-based capital ratio	11.57			12.01			12.09			(0.44)		(0.52)
Common equity tier 1 ratio	11.57			12.01			12.09			(0.44)		(0.52)
Leverage ratio	9.30			9.28			9.63			0.02		(0.33)
Risk-weighted Assets ($ in thousands)	$	1,876,698		$	1,776,821		$	1,707,318		5.62		9.92

ABOUT OP BANCORP

OP Bancorp, the holding company for Open Bank (the “Bank”), is a California corporation whose common stock is quoted on the Nasdaq Global Market under the ticker symbol, “OPBK.” The Bank is engaged in the general commercial banking business in Los Angeles, Orange, and Santa Clara Counties in California, the Dallas metropolitan area in Texas, and Clark County in Nevada and is focused on serving the banking needs of small- and medium-sized businesses, professionals, and residents with a particular emphasis on Korean and other ethnic minority communities. The Bank currently operates eleven full-service branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Cerritos, Gardena, Buena Park, and Santa Clara, California, Carrollton, Texas and Las Vegas, Nevada. The Bank also has five loan production offices in Pleasanton, California, Atlanta, Georgia, Aurora, Colorado, Lynnwood, Washington, and Fairfax, Virginia. The Bank commenced its operations on June 10, 2005 as First Standard Bank and changed its name to Open Bank in October 2010. Its headquarters is located at 1000 Wilshire Blvd., Suite 500, Los Angeles, California 90017. Phone 213.892.9999; www.myopenbank.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

attempts to expand into new geographic markets, products, or services; practical and regulatory constraints on the ability of Open Bank to pay dividends to us; increased capital requirements imposed by banking regulators, which may require us to raise capital at a time when capital is not available on favorable terms or at all; a failure in the internal controls we have implemented to address the risks inherent to the business of banking; including internal controls that affect the reliability of our publicly reported financial statements; inaccuracies in our assumptions about future events, which could result in material differences between our financial projections and actual financial performance, particularly with respect to the effects of predictions of future economic conditions as those circumstances affect our estimates for the adequacy of our allowance for credit losses and the related provision expense; changes in our management personnel or our inability to retain motivate and hire qualified management personnel; disruptions, security breaches, or other adverse events, failures or interruptions in, or attacks on, our information technology systems; disruptions, security breaches, or other adverse events affecting the third-party vendors who perform several of our critical processing functions; an inability to keep pace with the rate of technological advances due to a lack of resources to invest in new technologies; risks related to potential acquisitions; political developments, uncertainties or instability, catastrophic events, or natural disasters, such as earthquakes, fires, drought, pandemic diseases (such as the coronavirus) or extreme weather events, any of which may affect services we use or affect our customers, employees or third parties with which we conduct business; incremental costs and obligations associated with operating as a public company; the impact of any claims or legal actions to which we may be subject, including any effect on our reputation; compliance with governmental and regulatory requirements, including the Dodd-Frank Act and others relating to banking, consumer protection, securities and tax matters, and our ability to maintain licenses required in connection with commercial mortgage origination, sale and servicing operations; changes in federal tax law or policy; and our ability the manage the foregoing and other factors set forth in the Company’s public reports. We describe these and other risks that could affect our results in Item 1A. “Risk Factors,” of our latest Annual Report on Form 10-K for the year ended December 31, 2023 and in our subsequent filings with the Securities and Exchange Commission.

Contact

Investor Relations

OP Bancorp

Christine Oh

EVP & CFO

213.892.1192

Christine.oh@myopenbank.com

CONSOLIDATED BALANCE SHEETS (unaudited)



($ in thousands)	As of						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
Assets
Cash and due from banks	$	24,519	$	21,771	$	21,748	12.6	%	12.7	%
Interest-bearing deposits in other banks	142,237		105,905		83,992		34.3		69.3
Cash and cash equivalents	166,756		127,676		105,740		30.6		57.7
Available-for-sale debt securities, at fair value	199,373		199,205		191,313		0.1		4.2
Other investments	16,520		16,367		16,100		0.9		2.6
Loans held for sale	8,160		6,485		—		25.8		n/m
CRE loans	966,472		931,284		878,824		3.8		10.0
SBA loans	252,379		242,395		240,154		4.1		5.1
C&I loans	212,476		188,557		124,632		12.7		70.5
Home mortgage loans	499,666		506,873		515,789		(1.4)		(3.1)
Consumer loans	14		997		126		(98.6)		(88.9)
Gross loans receivable	1,931,007		1,870,106		1,759,525		3.3		9.7
Allowance for credit losses	(22,960)		(22,760)		(21,617)		0.9		6.2
Net loans receivable	1,908,047		1,847,346		1,737,908		3.3		9.8
Premises and equipment, net	4,961		4,716		5,378		5.2		(7.8)
Accrued interest receivable, net	9,479		8,555		7,996		10.8		18.5
Servicing assets	10,877		11,043		11,931		(1.5)		(8.8)
Company owned life insurance	22,739		22,566		22,071		0.8		3.0
Deferred tax assets, net	12,288		14,117		15,061		(13.0)		(18.4)
Other real estate owned	1,237		1,237		—		—		n/m
Operating right-of-use assets	7,870		8,348		8,993		(5.7)		(12.5)
Other assets	19,673		23,019		20,184		(14.5)		(2.5)
Total assets	$	2,387,980	$	2,290,680	$	2,142,675	4.2	%	11.4	%
Liabilities and Shareholders' Equity
Liabilities:
Noninterest-bearing	$	561,801	$	518,456	$	605,509	8.4	%	(7.2)	%
Money market and others	343,188		332,137		348,869		3.3		(1.6)
Time deposits greater than $250	564,547		533,857		420,162		5.7		34.4
Other time deposits	595,067		556,371		450,631		7.0		32.1
Total deposits	2,064,603		1,940,821		1,825,171		6.4		13.1
Federal Home Loan Bank advances	75,000		115,000		95,000		(34.8)		(21.1)
Accrued interest payable	19,483		15,504		13,552		25.7		43.8
Operating lease liabilities	8,417		9,000		9,926		(6.5)		(15.2)
Other liabilities	16,874		14,369		14,719		17.4		14.6
Total liabilities	2,184,377		2,094,694		1,958,368		4.3		11.5
Shareholders' equity:
Common stock	73,697		73,749		77,632		(0.1)		(5.1)
Additional paid-in capital	11,713		11,441		10,606		2.4		10.4
Retained earnings	131,588		127,929		117,483		2.9		12.0
Accumulated other comprehensive loss	(13,395)		(17,133)		(21,414)		(21.8)		(37.4)
Total shareholders’ equity	203,603		195,986		184,307		3.9		10.5
Total liabilities and shareholders' equity	$	2,387,980	$	2,290,680	$	2,142,675	4.2	%	11.4	%

CONSOLIDATED STATEMENTS OF INCOME (unaudited)



($ in thousands, except share and per share data)	For the Three Months Ended						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
Interest income
Interest and fees on loans	$	31,885	$	30,605	$	28,250	4.2	%	12.9	%
Interest on available-for-sale debt securities	1,626		1,590		1,519		2.3		7.0
Other interest income	1,788		2,162		1,417		(17.3)		26.2
Total interest income	35,299		34,357		31,186		2.7		13.2
Interest expense
Interest on deposits	17,921		17,343		13,006		3.3		37.8
Interest on borrowings	872		820		867		6.3		0.6	%
Total interest expense	18,793		18,163		13,873		3.5		35.5
Net interest income	16,506		16,194		17,313		1.9		(4.7)
Provision for credit losses	448		617		1,359		(27.4)		(67.0)
Net interest income after provision for credit losses	16,058		15,577		15,954		3.1		0.7
Noninterest income
Service charges on deposits	889		793		575		12.1		54.6
Loan servicing fees, net of amortization	693		575		468		20.5		48.1
Gain on sale of loans	2,088		2,325		1,179		(10.2)		77.1
Other income	570		491		379		16.1		50.4
Total noninterest income	4,240		4,184		2,601		1.3		63.0
Noninterest expense
Salaries and employee benefits	8,031		7,568		7,014		6.1		14.5
Occupancy and equipment	1,676		1,660		1,706		1.0		(1.8)
Data processing and communication	634		530		369		19.6		71.8
Professional fees	346		406		440		(14.8)		(21.4)
FDIC insurance and regulatory assessments	391		378		333		3.4		17.4
Promotion and advertising	151		151		207		—		(27.1)
Directors’ fees	154		178		164		(13.5)		(6.1)
Foundation donation and other contributions	549		539		529		1.9		3.8
Other expenses	788		779		773		1.2		1.9
Total noninterest expense	12,720		12,189		11,535		4.4		10.3
Income before income tax expense	7,578		7,572		7,020		0.1		7.9
Income tax expense	2,142		2,136		1,899		0.3		12.8
Net income	$	5,436	$	5,436	$	5,121	—	%	6.2	%

Book value per share	$	13.75	$	13.23	$	12.17	3.9	%	13.0	%
Earnings per share - basic	0.36		0.36		0.33		—		9.1
Earnings per share - diluted	0.36		0.36		0.33		—		9.1

Shares of common stock outstanding, at period end	14,811,671		14,816,281		15,149,203		—	%	(2.2)	%
Weighted average shares:
- Basic	14,812,118		14,868,344		15,131,587		(0.4)	%	(2.1)	%
- Diluted	14,812,118		14,868,344		15,140,577		(0.4)		(2.2)

KEY RATIOS



	For the Three Months Ended						% Change 3Q2024 vs.
	3Q2024		2Q2024		3Q2023		2Q2024		3Q2023
Return on average assets (ROA)(1)	0.94	%	0.95	%	0.96	%	—	%	—	%
Return on average equity (ROE)(1)	10.95		11.23		11.07		(0.3)		(0.1)
Net interest margin(1)	2.95		2.96		3.38		—		(0.4)
Efficiency ratio	61.31		59.81		57.92		1.5		3.4

Total risk-based capital ratio	12.79	%	13.26	%	13.31	%	(0.5)	%	(0.5)	%
Tier 1 risk-based capital ratio	11.57		12.01		12.09		(0.4)		(0.5)
Common equity tier 1 ratio	11.57		12.01		12.09		(0.4)		(0.5)
Leverage ratio	9.30		9.28		9.63		—		(0.3)

(1)Annualized.

CONSOLIDATED STATEMENTS OF INCOME (unaudited)



($ in thousands, except share and per share data)	For the Nine Months Ended
	3Q2024		3Q2023		% Change
Interest income
Interest and fees on loans	$	92,632	$	81,549	13.6	%
Interest on available-for-sale debt securities	4,676		4,647		0.6
Other interest income	5,261		3,686		42.7
Total interest income	102,569		89,882		14.1
Interest expense
Interest on deposits	50,939		35,308		44.3
Interest on borrowings	2,951		2,117		39.4
Total interest expense	53,890		37,425		44.0
Net interest income	48,679		52,457		(7.2)
Provision for credit losses	1,210		1,021		18.5
Net interest income after provision for credit losses	47,469		51,436		(7.7)
Noninterest income
Service charges on deposits	2,294		1,566		46.5	%
Loan servicing fees, net of amortization	2,040		1,909		6.9
Gain on sale of loans	6,116		5,847		4.6
Other income	1,560		1,179		32.3
Total noninterest income	12,010		10,501		14.4
Noninterest expense
Salaries and employee benefits	23,440		21,947		6.8
Occupancy and equipment	4,991		4,874		2.4
Data processing and communication	1,651		1,465		12.7
Professional fees	1,147		1,180		(2.8)
FDIC insurance and regulatory assessments	1,143		1,220		(6.3)
Promotion and advertising	451		528		(14.6)
Directors’ fees	489		535		(8.6)
Foundation donation and other contributions	1,628		1,876		(13.2)
Other expenses	2,126		2,118		0.4
Total noninterest expense	37,066		35,743		3.7
Income before income tax expense	22,413		26,194		(14.4)
Income tax expense	6,315		7,448		(15.2)
Net income	$	16,098	$	18,746	(14.1)	%

Book value per share	$	13.75	$	12.17	13.0	%
Earnings per share - basic	1.06		1.21		(12.4)
Earnings per share - diluted	1.06		1.21		(12.4)

Shares of common stock outstanding, at period end	14,811,671		15,149,203		(2.2)	%
Weighted average shares:
- Basic	14,890,479		15,158,365		(1.8)	%
- Diluted	14,890,479		15,169,794		(1.8)

KEY RATIOS



	For the Nine Months Ended
	3Q2024		3Q2023		% Change
Return on average assets (ROA)(1)	0.95	%	1.18	%	(0.2)	%
Return on average equity (ROE)(1)	11.00		13.69		(2.7)
Net interest margin(1)	2.99		3.45		(0.5)
Efficiency ratio	61.08		56.77		4.3

Total risk-based capital ratio	12.79	%	13.31	%	(0.5)	%
Tier 1 risk-based capital ratio	11.57		12.09		(0.5)
Common equity tier 1 ratio	11.57		12.09		(0.5)
Leverage ratio	9.30		9.63		(0.3)

(1)Annualized.

ASSET QUALITY



($ in thousands)	As of and For the Three Months Ended
	3Q2024			2Q2024			3Q2023
Nonaccrual loans(1)	$	3,620		$	4,389		$	4,211
Loans 90 days or more past due, accruing	—			—			—

Nonperforming loans	3,620			4,389			4,211
OREO	1,237			1,237			—
Nonperforming assets	$	4,857		$	5,626		$	4,211

Criticized loans by risk categories:
Special mention loans	$	4,540		$	3,339		$	3,651
Classified loans(1)(2)	11,960			13,089			10,139
Total criticized loans	$	16,500		$	16,428		$	13,790

Criticized loans by loan type:
CRE loans	$	5,249		$	5,896		$	5,130
SBA loans	10,144			9,771			6,169
C&I loans	1,107			550			—
Home mortgage loans	—			211			2,491
Total criticized loans	$	16,500		$	16,428		$	13,790

Nonperforming loans / gross loans	0.19		%	0.23		%	0.24		%
Nonperforming assets / gross loans plus OREO	0.25			0.30			0.24
Nonperforming assets / total assets	0.20			0.25			0.20
Classified loans / gross loans	0.62			0.70			0.58
Criticized loans / gross loans	0.85			0.88			0.78

Allowance for credit losses ratios:
As a % of gross loans	1.19		%	1.22		%	1.23		%
As a % of nonperforming loans	634			519			513
As a % of nonperforming assets	473			405			513
As a % of classified loans	192			174			213
As a % of criticized loans	139			139			157

Net charge-offs (recoveries)	$	34		$	(4)		$	488
Net charge-offs (recoveries)(3) to average gross loans(4)	0.01		%	(0.00)		%	0.11		%

(2)Consists of substandard, doubtful and loss categories.

(3)Annualized.

(4)Includes loans held for sale.



($ in thousands)	3Q2024		2Q2024		3Q2023
Accruing delinquent loans 30-89 days past due
30-59 days	$	4,095	$	3,774	$	5,979
60-89 days	6,211		2,878		2,377
Total	$	10,306	$	6,652	$	8,356

AVERAGE BALANCE SHEET, INTEREST AND YIELD/RATE ANALYSIS



	For the Three Months Ended
	3Q2024						2Q2024						3Q2023
($ in thousands)	Average Balance		Interest and Fees		Yield/ Rate(1)		Average Balance		Interest and Fees		Yield/ Rate(1)		Average Balance		Interest and Fees		Yield/ Rate(1)
Interest-earning assets:
Interest-bearing deposits in other banks	$	109,003	$	1,474	5.29	%	$	135,984	$	1,847	5.37	%	$	82,752	$	1,116	5.28	%
Federal funds sold and other investments	16,432		314		7.65		16,307		315		7.72		16,176		301		7.44
Available-for-sale debt securities, at fair value	199,211		1,626		3.26		195,512		1,590		3.25		199,205		1,519		3.05
CRE loans	944,818		14,759		6.21		908,073		13,742		6.09		856,911		12,207		5.65
SBA loans	270,282		7,107		10.46		259,649		7,116		11.02		248,960		7,303		11.64
C&I loans	187,163		3,642		7.74		172,481		3,367		7.85		117,578		2,340		7.90
Home mortgage loans	503,148		6,364		5.06		501,862		6,348		5.06		516,465		6,393		4.95
Consumer loans	541		13		9.37		1,219		32		10.44		274		7		10.01
Loans(2)	1,905,952		31,885		6.66		1,843,284		30,605		6.67		1,740,188		28,250		6.45
Total interest-earning assets	2,230,598		35,299		6.30		2,191,087		34,357		6.29		2,038,321		31,186		6.08
Noninterest-earning assets	88,747						89,446						84,580
Total assets	$	2,319,345					$	2,280,533					$	2,122,901

Interest-bearing liabilities:
Money market deposits and others	$	343,429	$	3,601	4.17	%	$	338,554	$	3,494	4.15	%	$	352,424	$	3,487	3.93	%
Time deposits	1,127,078		14,320		5.05		1,102,587		13,849		5.05		869,675		9,519		4.34
Total interest-bearing deposits	1,470,507		17,921		4.85		1,441,141		17,343		4.84		1,222,099		13,006		4.22
Borrowings	80,326		872		4.32		77,314		820		4.27		79,891		867		4.31
Total interest-bearing liabilities	1,550,833		18,793		4.82		1,518,455		18,163		4.81		1,301,990		13,873		4.23
Noninterest-bearing liabilities:
Noninterest-bearing deposits	528,126						529,179						599,262
Other noninterest-bearing liabilities	41,892						39,301						36,620
Total noninterest-bearing liabilities	570,018						568,480						635,882
Shareholders’ equity	198,494						193,598						185,029
Total liabilities and shareholders’ equity	$	2,319,345					2,280,533						2,122,901

Net interest income / interest rate spreads			$	16,506	1.48	%			$	16,194	1.48	%			$	17,313	1.85	%
Net interest margin					2.95	%					2.96	%					3.38	%

Cost of deposits & cost of funds:
Total deposits / cost of deposits	$	1,998,633	$	17,921	3.57	%	$	1,970,320	$	17,343	3.54	%	$	1,821,361	$	13,006	2.83	%
Total funding liabilities / cost of funds	2,078,959		18,793		3.60		2,047,634		18,163		3.57		1,901,252		13,873		2.90

(1)Annualized.

(2)Includes loans held for sale.



	For the Nine Months Ended
	3Q2024						3Q2023
($ in thousands)	Average Balance		Interest and Fees		Yield/ Rate(1)		Average Balance		Interest and Fees		Yield/ Rate(1)
Interest-earning assets:
Interest-bearing deposits in other banks	$	106,022	$	4,310	5.34	%	$	78,736	$	2,965	4.97	%
Federal funds sold and other investments	16,335		951		7.76		14,575		721		6.59
Available-for-sale debt securities, at fair value	195,383		4,676		3.19		206,448		4,647		3.00
CRE loans	918,149		42,230		6.14		845,340		35,209		5.57
SBA loans	263,126		21,436		10.88		262,130		21,459		10.94
C&I loans	164,927		9,679		7.84		117,850		6,772		7.68
Home mortgage loans	505,669		19,207		5.06		504,188		18,069		4.78
Consumer & other loans	1,046		80		10.10		994		40		5.40
Loans(2)	1,852,917		92,632		6.68		1,730,502		81,549		6.30
Total interest-earning assets	2,170,657		102,569		6.30		2,030,261		89,882		5.91
Noninterest-earning assets	88,594						84,044
Total assets	$	2,259,251					$	2,114,305

Interest-bearing liabilities:
Money market deposits and others	$	349,766	$	11,035	4.21	%	$	373,041	$	9,838	3.53	%
Time deposits	1,061,609		39,904		5.02		833,603		25,470		4.09
Total interest-bearing deposits	1,411,375		50,939		4.82		1,206,644		35,308		3.91
Borrowings	88,743		2,951		4.44		63,078		2,117		4.49
Total interest-bearing liabilities	1,500,118		53,890		4.80		1,269,722		37,425		3.94
Noninterest-bearing liabilities:
Noninterest-bearing deposits	523,951						628,569
Other noninterest-bearing liabilities	40,141						33,377
Total noninterest-bearing liabilities	564,092						661,946
Shareholders’ equity	195,041						182,637
Total liabilities and shareholders’ equity	$	2,259,251					2,114,305

Net interest income / interest rate spreads			$	48,679	1.50	%			$	52,457	1.97	%
Net interest margin					2.99	%					3.45	%

Cost of deposits & cost of funds:
Total deposits / cost of deposits	$	1,935,326	$	50,939	3.52	%	1,835,213		$	35,308	2.57	%
Total funding liabilities / cost of funds	2,024,069		53,890		3.56		1,898,291		37,425		2.64

(1)Annualized.

(2)Includes loans held for sale.

Exhibit 99.2

OP Bancorp Declares Quarterly Cash Dividend of $0.12 per Share

LOS ANGELES, October 24, 2024 — OP Bancorp (the “Company”) (NASDAQ: OPBK), the holding company of Open Bank (the “Bank”), announced today that its Board of Directors declared a quarterly cash dividend of $0.12 per share of its common stock. The dividend is payable on or about November 21, 2024 to all shareholders of record as of the close of business on November 7, 2024.

About OP Bancorp

OP Bancorp, the holding company for Open Bank (the “Bank”), is a California corporation whose common stock is quoted on the Nasdaq Global Market under the ticker symbol, “OPBK.” The Bank is engaged in the general commercial banking business in Los Angeles, Orange, and Santa Clara Counties in California, the Dallas metropolitan area in Texas, and Clark County in Nevada and is focused on serving the banking needs of small- and medium-sized businesses, professionals, and residents with a particular emphasis on Korean and other ethnic minority communities. The Bank currently operates with eleven full service branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Cerritos, Gardena, Buena Park, and Santa Clara, California, Carrollton, Texas, and Las Vegas, Nevada. The Bank also has five loan production offices in Pleasanton, California, Atlanta, Georgia, Aurora, Colorado, Lynnwood, Washington, and Fairfax, Virginia. The Bank commenced its operations on June 10, 2005 as First Standard Bank and changed its name to Open Bank in October 2010. Its headquarters is located at 1000 Wilshire Blvd., Suite 500, Los Angeles, California 90017. Phone 213.892.9999; www.myopenbank.com Member FDIC, Equal Housing Lender.

Contact

Investor Relations

OP Bancorp

Christine Oh

EVP & CFO

213.892.1192

Christine.oh@myopenbank.com

2024 Third Quarter Earnings Presentation October 24, 2024

Certain matters set forth herein constitute “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including forward- looking statements relating to the Company’s current business plans and expectations regarding future operating results. These forward-looking statements are subject to risks and uncertainties that could cause actual results, performance or achievements to differ materially from those projected. These risks and uncertainties, some of which are beyond our control, include, but are not limited to: the effects of substantial fluctuations in, and continuing elevated levels of, interest rates on our borrowers’ ability to perform in accordance with the terms of their loans and on our deposit customers’ expectation for higher rates on deposit products; cybersecurity risks, including the potential for the occurrence of successful cyberattacks and our ability to prevent and to mitigate the harms resulting from any such attacks; infrastructure risks and similar circumstances that affect our and our customers’ ability to communicate and to engage in routine online banking activities; business and economic conditions, particularly those affecting the financial services industry and our primary market areas; risks of international conflict, terrorism, civil unrest and domestic instability; the continuing effects of inflation and monetary policies, particularly those relating to the decisions and indicators of intent expressed by the Federal Reserve Open Markets Committee, as those circumstances impact our operations and our current and prospective borrowers and depositors; our ability to balance deposit liabilities and liquidity sources (including our ability to reprice those instruments and balancing our borrowings and investments to keep pace with changing market conditions) so as to meet current and expected withdrawals while promoting strong earning capacity; our ability to manage our credit risk successfully and to assess, adjust and monitor the sufficiency of our allowance for credit losses; factors that can impact the performance of our loan portfolio, including real estate values and liquidity in our primary market areas, the financial health of our commercial borrowers, the success of construction projects that we finance, including any loans acquired in acquisition transactions; the impacts of credit quality on our earnings and the related effects of increases to the reserve on our net income; our ability effectively to execute our strategic plan and manage our growth; interest rate fluctuations, which could have an adverse effect on our profitability; external economic and/or market factors, such as changes in monetary and fiscal policies and laws, including inflation or deflation, changes in the demand for loans, and fluctuations in consumer spending, borrowing and savings habits, which may have an adverse impact on our financial condition; continued or increasing competition from other banks and from credit unions and non-bank financial services companies, many of which are subject to less restrictive or less costly regulations than we are; challenges arising from unsuccessful attempts to expand into new geographic markets, products, or services; practical and regulatory constraints on the ability of Open Bank to pay dividends to us; increased capital requirements imposed by banking regulators, which may require us to raise capital at a time when capital is not available on favorable terms or at all; a failure in the internal controls we have implemented to address the risks inherent to the business of banking; including internal controls that affect the reliability of our publicly reported financial statements; inaccuracies in our assumptions about future events, which could result in material differences between our financial projections and actual financial performance, particularly with respect to the effects of predictions of future economic conditions as those circumstances affect our estimates for the adequacy of our allowance for credit losses and the related provision expense; changes in our management personnel or our inability to retain motivate and hire qualified management personnel; disruptions, security breaches, or other adverse events, failures or interruptions in, or attacks on, our information technology systems; disruptions, security breaches, or other adverse events affecting the third-party vendors who perform several of our critical processing functions; an inability to keep pace with the rate of technological advances due to a lack of resources to invest in new technologies; risks related to potential acquisitions; political developments, uncertainties or instability, catastrophic events, or natural disasters, such as earthquakes, fires, drought, pandemic diseases (such as the coronavirus) or extreme weather events, any of which may affect services we use or affect our customers, employees or third parties with which we conduct business; incremental costs and obligations associated with operating as a public company; the impact of any claims or legal actions to which we may be subject, including any effect on our reputation; compliance with governmental and regulatory requirements, including the Dodd-Frank Act and others relating to banking, consumer protection, securities and tax matters, and our ability to maintain licenses required in connection with commercial mortgage origination, sale and servicing operations; changes in federal tax law or policy; and our ability the manage the foregoing and other factors set forth in the Company’s public reports. We describe these and other risks that could affect our results in Item 1A. “Risk Factors,” of our latest Annual Report on Form 10-K for the year ended December 31, 2023 and in our subsequent filings with the Securities and Exchange Commission. Cautionary Note Regarding Forward-Looking Statements 2

3Q-2024 Highlights vs 2Q-2024 3 (1) Annualized. (2) Excludes the guaranteed portion of SBA loans that are in liquidation. (3) Includes special mention, substandard, doubtful, and loss categories. Net Income $5.4M Earnings & Profitability Balance Sheet Growth Credit Quality Capital Adequacy • Net income of $5.44 million, compared to $5.44 million • Diluted earnings per share of $0.36, compared to $0.36 • ROAA(1) and ROAE(1) of 0.94% and 10.95%, compared to 0.95% and 11.23%, respectively • Net interest margin of 2.95%, compared to 2.96% • Efficiency ratio of 61.31%, compared to 59.81% • Total assets of $2.39 billion, a 4.2% increase compared to $2.29 billion • Gross loans of $1.93 billion, a 3.3% increase compared to $1.87 billion • Total deposits of $2.06 billion, a 6.4% increase compared to $1.94 billion • Net loan charge-offs(1) to average gross loans of 0.01%, compared to (0.00)% • Nonperforming loans(2) to gross loans of 0.19%, compared to 0.23%. • Criticized loans (2) (3) to gross loans of 0.85%, compared to 0.88% • Remained well-capitalized with a Common Equity Tier 1 (“CET1”) ratio of 11.57% • Book value per common share increased to $13.75, compared to $13.23 • Repurchased 4,610 shares of common stock at an average price of $10.09 per share • Paid quarterly cash dividend of $0.12 per share for the periods Diluted EPS $0.36 ROAA 0.94% ROAE 10.95% NIM 2.95% Efficiency 61.31%

Balance Sheet Trend 4 Gross Loans ($mm)Total Assets ($mm) Total Equity ($mm) & Book Value Per Share ($)Total Deposits ($mm)

Loan Trend 5 Loan Originations ($mm)Loan Composition ($mm) Loan Yields (%) Commercial Real Estate Concentration (%)

Loan by Interest Rate Type 6 Hybrid Loan Repricing Schedule ($mm)Composition by Interest Rate Type (%) Contractual Rates by Interest Rate Type (%) Loan Maturity Schedule ($mm)

Gross Loans Diversification with Growth 7

* Based on Call Report definitions, which includes real estate loans and SBA real estate loans. Commercial Real Estate Portfolio 8 CRE* Portfolio by Property TypeCRE* Portfolio by Collateral Type

* Based on Call Report definitions, which includes real estate loans and SBA real estate loans. ** Excludes SBA loans and USDA loans. Commercial Real Estate Portfolio 9 CRE Portfolio ** by Loan-to-Value Ratio (LTV)CRE Portfolio * by Location * CRE Weighted Average LTV: 50.2%

Home Loan Portfolio 10 Home Loan Portfolio by LTVHome Loan Portfolio by Location Home Loan Portfolio by Occupancy Type

* Includes $1.8 million in USDA loans. SBA Loans 11 SBA Portfolio* by IndustrySBA Portfolio* by Location

* Includes $1.8 million in USDA loans. ** Includes $1.8 million in USDA loans but excludes $18.6 million in SBA C&I loans. SBA Loans 12 SBA Portfolio* by Collateral TypeSBA Portfolio** by LTV

Gross Loan Changes by Activity 13

Deposit Trend 14 Noninterest Bearing Deposits ($mm)Deposit Composition ($mm) Cost of Deposits (%) CD Maturity Schedule ($mm)

Earnings & Profitability 15 Noninterest Income ($mm)Net Interest Income ($mm) & Net Interest Margin (%) Interest Income & Interest Expense ($mm) Noninterest Income Components ($mm) * Ratios for interest income & interest expense are percentages of average assets and are annualized.

Earnings & Profitability 16 Efficiency Ratio (%)Noninterest Expense ($mm) Noninterest Expense Components ($mm) Efficiency Ratio Components (%) * Ratios for Efficiency Ratio Components are percentages of average assets and are annualized.

Earnings & Profitability 17 Pre-Provision Net Revenue ($mm)Provision for Loan Losses ($mm) Net Income ($mm) & Diluted EPS ($) Return on Assets & Return on Equity (%)

Source: Target Fed Funds Rate per Federal Open Market Committee guidance. Net Interest Margin Trend 18

Credit Quality 19 Criticized Loans ($mm)Nonperforming Loans ($mm) Net Charge-Offs ($mm)Allowance for Credit Losses** ($mm) * Exclude the guaranteed portion of SBA loans that are in liquidation. ** ACL was calculated under the CECL methodology in 2023; prior periods were calculated under the incurred loss methodology.

Liquidity & Capital 20 Total Liquidity ($mm)On Balance Sheet Liquidity ($mm) Tier 1 Leverage ($mm) Total Risk Based Capital ($mm)

Non-GAAP Reconciliation 21 Pre-Provision Net Revenue ($ in thousands) 3Q-24 2Q-24 1Q-24 4Q-23 3Q-23 Interest income 35,299$ 34,357$ 32,913$ 31,783$ 31,186$ Interest expense 18,794 18,162 16,934 15,553 13,873 Net interest income 16,506 16,195 15,979 16,230 17,313 Noninterest income 4,241 4,183 3,586 3,680 2,601 Noninterest expense 12,720 12,189 12,157 11,983 11,535 Pre-Provision Net Revenue (a) 8,026$ 8,189$ 7,408$ 7,927$ 8,379$ Reconciliation to Net Income: (Reversal of) provision for loan losses (b) 448 617 145 630 1,359 Provision for income taxes (c) 2,142 2,136 2,037 2,125 1,899 Net income (a) - (b) - (c) 5,436$ 5,436$ 5,226$ 5,172$ 5,121$ For the Three Months Ended Pre-provision net revenue removes provision for loan losses and income tax expense. Management believes that this non-GAAP measure, when taken together with the corresponding GAAP financial measures (as applicable), provides meaningful supplemental information regarding our performance. This non-GAAP financial measure also facilitates a comparison of our performance to prior periods.

Cover	Oct. 24, 2024
Cover [Abstract]
Document Type	8-K
Document Period End Date	Oct. 24, 2024
Entity Registrant Name	OP BANCORP
Entity Incorporation, State or Country Code	CA
Entity File Number	001-38437
Entity Tax Identification Number	81-3114676
Entity Address, Address Line One	1000 Wilshire Blvd
Entity Address, Address Line Two	Suite 500
Entity Address, City or Town	Los Angeles
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90017
City Area Code	213
Local Phone Number	892-9999
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, No Par Value
Trading Symbol	OPBK
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false
Entity Central Index Key	0001722010
Amendment Flag	false

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