Wilshire Bancorp Inc. late Monday said that its third quarter profit jumped 277 percent as the Koreatown bank holding company saw growth in new loans and a decline in older problem loans.
After the markets closed, the parent of Wilshire State Bank reported net income of $38.5 million (54 cents a share) compared with $10.2 million (14 cents) in the same period a year earlier
Much of the gain was attributed to improved credit quality and reduced gross charge-offs of bad loans. The company also benefited from a tax benefit of $12.6 million.
Net interest income rose 5.6 percent to $25.6 million. Non-interest income fell 22 percent to $6.6 million as the bank decided to retain a larger portion of its SBA loan production and not sell them. Gross loan production grew 3 percent to $2.03 billion. Non-accrual loans declined 31 percent to $38.9 million, and total charge-offs fell 75 percent to $3.1 million.
The company earlier this month announced that that the Federal Reserve Bank of San Francisco had lifted an informal enforcement action against the bank, which took heavy losses in 2010 and early 2011 as a result of bad loans. That prompted the departure of several executives and directors and increased scrutiny by regulators.
Chief Executive Jae Whan said the latest results represented the highest level of net income and earnings per share in the bank’s history. “We believe that the company continues to exhibit positive trends, including solid loan growth, an improving deposit mix, an expanding net interest margin, and improved efficiencies,” Whan said in a statement.
Shares were unchanged at $6.29 in Monday trading on the Nasdaq, but rose 6.5 percent in after-hours trading.