OP Bancorp Reports 10.2% Increase in Total Assets to $2.37 Billion for 2024

OP Bancorp (OPBK), a California-based bank holding company, reported consolidated total assets of $2.37 billion as of December 31, 2024, a 10.2% increase from $2.15 billion the previous year. Total deposits rose 12.2% to $2.03 billion, while total loans outstanding, net of allowances for credit losses, reached $1.93 billion, a 10.8% increase. Shareholders' equity increased by 6.4% to $205.0 million. The company's commercial banking activities are primarily focused on the Korean-American community, operating through eleven full-service branches and five loan production offices across several states.

For the year ended December 31, 2024, OP Bancorp's net interest income decreased by 4.5% to $65.6 million, compared to $68.7 million in 2023. This decrease was primarily attributed to higher interest expense on interest-bearing deposits, partially offset by increased interest income on loans and interest-bearing deposits in other banks. Net income fell 11.9% to $21.1 million ($1.39 per diluted common share) from $23.9 million ($1.55 per diluted common share) in 2023. The decrease in net income also reflected a $2.5 million increase in noninterest expense, partially offset by a $2.2 million increase in noninterest income and a $1.6 million decrease in income tax expense.

The company's strategic initiatives include leveraging its franchise in Korean-American communities, focusing on organic growth, increasing its share of lower-cost deposits, and expanding its branch network and commercial lending portfolio. OP Bancorp also highlighted its commitment to disciplined lending practices and its strong community relationships through the Open Stewardship Foundation, to which it contributes 10% of its consolidated net income after taxes. As of December 31, 2024, the company employed 231 full-time equivalent employees.

Significant risks identified by the company include interruptions from cyberattacks, rapid technological developments, adverse economic conditions, interest rate fluctuations, liquidity risks, and credit quality concerns. The company also noted risks associated with its growth strategy, including the limitations imposed by its existing license agreement for the use of the "Open Bank" name and the challenges of managing branch expansion and new lines of business. The company's risk management framework addresses credit, market, liquidity, interest rate, and compliance risks.

OP Bancorp's outlook is tied to its ability to continue growing its loan and deposit base organically, while managing risks associated with interest rate fluctuations and economic uncertainty. The company stated it remains amenable to opportunistic strategic acquisitions to enhance its long-term growth strategy, but acknowledged the challenges of competing with larger institutions for acquisition opportunities. The company's dividend policy remains subject to its capital requirements, financial condition, and regulatory limitations.