Pacific City Financial Corporation Reports Strong 2015 Third Quarter Financial Results

Pacific City Financial Corporation (the “Company”) (OTC Pink: PFCF), the holding company of Pacific City Bank, today reported net income available to common shareholders of $3.2 million, or $0.32 per diluted common share, for the third quarter of 2015. The 2015 third quarter net income of $3.2 million was in line with 2015 second quarter net income, but declined $422,000 compared with the 2014 third quarter net income of $3.6 million. Year-to-date net income totaled $9.3 million, or $0.94 per diluted common share, for the nine month period in 2015 compared to $9.1 million, or $0.97 per diluted common share, for the same period in 2014.

2015 Third Quarter Highlights

• Net income available to common shareholders totaled $3.2 million, or $0.32 per diluted common share
• Total assets increased $174.1 million, or 20.4%, to $1,028.9 million from $854.8 million at September 30, 2014
• Gross loans, net of unearned fee/cost, increased $92.7 million, or 13.0%, to $808.3 million from $715.6 million at September 30, 2014
• Total deposits increased $161.9 million, or 21.1%, to $928.4 million from $766.5 million at September 30, 2014
• Classified assets to tier 1 and ALLL ratio improved to 6.2% from 12.95% at September 30, 2014
• Opened first out of state full service branch in Fort Lee, New Jersey

"We are pleased to report another strong quarterly financial performance coupled with the opening of our first out of state full service branch in Fort Lee, New Jersey. Our assets exceeded $1.0 billion with an increase of our deposits to a record high of $928 million or 3% from June 30, 2015 and an increase of loans to $808 million or 2%,” stated Haeyoung Cho, President CEO. “We are very excited with the opening of our Fort Lee branch where we see an expanding market.”

2015 Third Quarter Financial Highlights
(dollars in thousands, except per share data)
			At or for the Three Months Ended
			Sept. 30, 2015					Jun. 30, 2015					% change					Sept. 30, 2014					% change
Net income			$	3,186				$	3,169				0.5	%				$	3,664				-13.0	%
Net income available to common shareholders			$	3,186				$	3,169				0.5	%				$	3,608				-11.7	%
Earnings per common share (basic)			$	0.33				$	0.32				3.1	%				$	0.38				-13.2	%
Net interest income			$	9,392				$	9,259				1.4	%				$	8,257				13.7	%
Provision (Reversal) for loan loss			$	95				$	169				-43.8	%				$	(672	)			-114.1	%
Non-interest income			$	3,134				$	3,572				-12.3	%				$	4,160				-24.7	%
Non-interest expense			$	6,836				$	7,170				-4.7	%				$	6,331				8.0	%
Total assets			$	1,028,887				$	998,136				3.1	%				$	854,769				20.4	%
Loans receivable, net of allowance and loan fee/cost			$	799,105				$	783,534				2.0	%				$	705,653				13.2	%
Total deposits			$	928,429				$	901,035				3.0	%				$	766,523				21.1	%
Return on average assets				1.24	%				1.35	%									1.75	%
Return on average stockholders' equity				13.37	%				13.87	%									17.99	%
Net interest margin				3.73	%				3.96	%									4.05	%
Efficiency ratio				54.58	%				55.88	%									50.99	%
Tangible common equity to tangible assets				9.30	%				9.27	%									9.80	%	*
Tangible common equity per common share			$	9.77				$	9.45									$	8.58		*
Tier 1 leverage ratio (consolidated)				9.35	%				9.73	%									10.14	%
* 10% stock dividend paid on March 20, 2015 reflected retroactively.

OPERATING RESULTS FOR THE 2015 THIRD QUARTER

Net Income Summary

Net income available to common shareholders in the third quarter of 2015 remained at $3.2 million compared with the second quarter of 2015, but declined 11.7%, or $422,000, from the year-ago quarter. The decrease from the year-ago quarter was primarily due to a decrease of $1.0 million in noninterest income, an increase of $505,000 in noninterest expense, and a loan loss provision of $95,000 compared with a reversal of loan loss provision expense of $672,000, partially offset by an increase of $1.1 million in net interest income and a decrease of $685,000 in income tax provision.

Net Interest Income and Net Interest Margin

Net interest income before provision for loan losses in the third quarter of 2015 increased $133,000, or 1.4%, to $9.4 million compared with the previous quarter, and increased $1.1 million, or 13.7%, compared with the year-ago quarter. The increase was primarily due to the overall growth in loan balance partially offset by a decline in loan yield.

The average loan balance was $813.6 million in the third quarter of 2015 compared with $795.2 million in the second quarter of 2015, and $692.6 million in the third quarter of 2014. The Bank originated $110.2 million in new loans during the third quarter of 2015 compared with $118.7 million for the second quarter of 2015, and $149.0 million for the third quarter of 2014.

The loan yield for the third quarter of 2015 declined 3bps to 5.12% compared with 5.15% for the second quarter of 2015, and declined 12 bps compared with 5.24% for the third quarter of 2014. The decline in loan yield for third quarter of 2015 compared with the third quarter of 2014 was primarily due to the bank’s ongoing strategy to book proportionally more variable loans that generally yields lower than fixed rate loans at funding to reduce the interest rate risk associated with a rising interest rate environment.

Below is a table of fixed and variable interest rate loans accompanied with weighted average contractual rates:

		September 30, 2015										June 30, 2015										September 30, 2014
		% to Gross Loans *					WAVG Contractual Rate					% to Gross Loans *					WAVG Contractual Rate					% to Gross Loans *					WAVG Contractual Rate
Fixed rate loans		40.4	%				5.12	%				43.1	%				5.12	%				48.5	%				5.12	%
Variable rate loans		59.6	%				4.32	%				56.9	%				4.34	%				51.5	%				4.55	%
* Including LHFS

Net interest margin decreased 23 bps to 3.73% in the third quarter of 2015 compared with 3.96% in the previous quarter, and decreased 32 bps compared with 4.05% in the year-ago quarter primarily due to the aforementioned decline in loan yields and an increase in average interest-bearing Federal Reserve Bank balance which yields lower than other interest earning assets. The average interest-bearing Federal Reserve Bank balance essentially doubled to $89.0 million in the third quarter of 2015 compared with $46.4 million in the second quarter of 2015, and $40.5 million in the third quarter of 2014.

Total interest expenses for the third quarter of 2015 increased $149,000, or 10.0%, to $1.6 million compared with $1.5 million in the second quarter of 2015, and increased $354,000, 27.5%, compared with $1.3 million for the year-ago quarter primarily due to an increase in average interest bearing deposit balance. The cost of interest-bearing deposits remained at 0.94% for the third compared with the second quarter of 2015, and increased 2 bps compared with the third quarter of 2014.

The cost of total deposit including non-interest bearing deposits was 0.71% for the third quarter of 2015 compared with 0.70% for the second quarter of 2015, and 0.68% for the third quarter of 2014.

Non-interest Income

Non-interest income for the third quarter of 2015 decreased $438,000, or 12.3%, to $3.1 million compared with $3.6 million in the 2015 second quarter, and decreased $1.0 million, or 24.7%, compared with $4.2 million in the year-ago quarter. The decrease was primarily due to a decrease on gain on sale of SBA loans and residential mortgage loan. The gain on sale of SBA and residential mortgage loans were $1.9 million in the third quarter of 2015, $2.5 million in the second quarter 2015, and $3.0 million in the third quarter of 2014.

The Company sold $25.5 million of guaranteed portion of SBA loans in the third quarter of 2015 compared with $25.8 million in the second quarter of 2015, and $37.6 million in the third quarter of 2014. The Company also sold $13.6 million in residential mortgage loans in the third quarter of 2015 compared with $20.0 million in the second quarter of 2015, and $2.9 million for the third quarter of 2014.

Non-interest Expenses

Non-interest expenses for the third quarter of 2015 declined $334,000, or 4.7%, to $6.8 million compared with $7.2 million in the previous quarter, and increased $505,000, or 8.0%, compared with the year-ago quarter. The decrease compared with the previous quarter was primarily due to a decrease in employee salary and benefits expenses and a decrease in marketing expenses. The increase compared with the year-ago quarter was primarily due to an increase in the salary and benefits expenses stemming from an increase in headcount in conjunction with asset growth.

Income Tax Provision

The Company’s effective income tax rate was 43.06% for the third quarter of 2015 compared with 42.3% for the second quarter of 2015, and 45.8% for the third quarter of 2014. Year-to date effective income tax rate for the nine months ended September 30, 2015 was 42.25% compared with 42.07% for the nine months ended September 30, 2014.

BALANCE SHEET SUMMARY

Total Assets

Total assets at September 30, 2015 increased $30.8 million, or 3.1%, to $1,028.9 million compared with $998.1 million at June 30, 2015, and increased $174.1 million, or 20.4%, compared with $854.8 million at September 30, 2014.

Loans

Gross loan receivable, net of deferred costs and fees, increased $15.5 million, or 2.0%, to $808.3 million at September 30, 2015 compared with $792.8 million at June 30, 2015, and increased $92.7 million, or 13.0%, compared with $715.6 million at September 30, 2014.

The following table is a list of gross loan balance by type excluding unearned loan fees and allowance for loan losses:

Loan type (in thousands)
				Sept. 30, 2015				Jun. 31, 2015				Percentage Change				Sept. 30, 2014				Percentage Change
Real estate loans				$	467,656			$	462,103			1.2	%			$	403,154			16.0	%
Residential mortgage loans					121,777				119,607			1.8	%				115,278			5.6	%
SBA loans					107,678				103,226			4.3	%				92,771			16.1	%
Commercial industrial loans					82,452				79,436			3.8	%				73,046			12.9	%
Consumer loans					28,601				28,250			1.2	%				31,104			-8.0	%
	Gross loans receivables				808,164				792,622			2.0	%				715,353			13.0	%
Held for sale loans					3,170				5,186			-38.9	%				5,717			-44.6	%
	Total gross loans			$	811,334			$	797,808			1.7	%			$	721,070			12.5	%

Investment Securities

Total investment securities portfolio balance at September 30, 2015 increased $11.1 million, or 13.8%, to $91.7 million compared with $80.6 million at June 30, 2015, and increased $24.3 million, or 36.0%, compared with $67.4 million at September 30, 2014. The increase compared with the previous quarter was primarily due to purchases of $14.3 million in investment securities during the third quarter 2015, partially offset by principal pay-down of $3.4 million.

Deposits

Total deposit balance increased $27.4 million, or 3.0%, to $928.4 million at September 30, 2015 compared with $901.0 million at June 30, 2015, and increased $161.9 million, or 21.1%, compared with $766.5 million at September 30, 2014. The ratio of demand deposits to total deposits was 25.3% at September 30, 2015 compared with 25.1% at June 30, 2015, and 26.1% at September 30, 2014.

The following is a deposit mix table by period:

Deposit mix (in thousands)
				September 30, 2015								June 30, 2015								September 30, 2014
				Amount				Percentage				Amount				Percentage				Amount				Percentage
Demand deposits				$	234,527			25.3	%			$	226,172			25.5	%			$	199,872			26.1	%
Now accounts					9,652			1.0	%				11,202			0.9	%				8,091			1.1	%
Money market accounts					222,715			24.0	%				192,862			21.7	%				146,825			19.2	%
Savings					7,323			0.8	%				7,191			0.8	%				6,722			0.9	%
Time deposits under $250K					245,356			26.4	%				253,410			12.2	%				209,171			27.3	%
Time deposits of $250K and over					112,855			12.2	%				111,196			28.0	%				98,761			12.9	%
State & Broker CDs					96,001			10.3	%				99,001			10.9	%				97,081			12.7	%
	Total deposits			$	928,429			100.0	%			$	901,034			100.0	%			$	766,523			100.0	%

CREDIT QUALITY

Loan Loss Provision

The provision for loan losses in the third quarter of 2015 was $95,000 compared with $169,000 in the previous quarter, and a reversal of $672,000 in the year-ago quarter. During the third quarter of 2015, the Company recognized a net charged-off of $154,000 in loans compared with a net charged-off of $292,000 in the second quarter of 2015, and a net recovery of $101,000 in the third quarter of 2014. Annualized net charge-off ratio in the third quarter of 2015 was 0.08% compared with 0.15% in the previous quarter, and a negative 0.06% in the year-ago quarter.

The allowance for loan losses to total gross loans ratio was 1.14% at September 30, 2015 compared with 1.17% at June 30, 2015, and 1.39% at September 30, 2014.

Non-performing Assets

Non-performing loans (“NPL”) balance remained at $2.8 million at September 30, 2015 compared with June 30, 2015, and declined $526,000 compared with $3.3 million at September 30, 2014. Non-performing loans to gross loans ratios of 0.35% at September 30, 2015 did not change from June 30, 2015, and the ratio was 0.46% at September 30, 2014.

OREO balance at September 30, 2015 and June 30, 2015 was zero compared with $549,000 at September 30, 2014.

The following tables summarize composition of non-performing loans and non-performing assets:

Non-performing loans composition (Dollars in thousands)
				Sept. 30, 2015				Jun. 30, 2015				Percentage Change				Sept. 30, 2014				Percentage Change
Real estate loans				$	83			$	87			-4.6	%			$	101			-17.8	%
Commercial and industrial loans					1,023				858			19.2	%				1,008			1.5	%
SBA loans					1,620				1,791			-9.5	%				2,095			-22.7	%
Consumer loans & others					69				66			4.5	%				117			-41.0	%
				$	2,795			$	2,802			-0.2	%			$	3,321			-15.8	%

Non-performing assets (Dollars in thousands)
				Sept. 30, 2015						Jun. 30, 2015					% Change					Sept. 30, 2014						% Change
Non-performing loans (NPL)				$	2,795					$	2,802				-0.2	%				$	3,321					-15.8	%
Non-performing TDR (included in NPL)				$	1,995					$	1,816				9.9	%				$	2,566					-22.3	%
Gross loans including deferred loan fees/cost				$	808,304					$	792,792				2.0	%				$	715,578					13.0	%
NPL/Gross loans					0.35	%					0.35	%									0.46	%
OREO				$	-					$	-				-					$	549					-100.0	%
Performing TDR				$	2,951					$	3,186				-7.4	%				$	7,460					-60.4	%
NPA (NPL+OREO)				$	2,795					$	2,802				-0.2	%				$	3,870					-27.8	%
Total assets				$	1,028,887					$	998,136				3.1	%				$	854,769					20.4	%
NPA (NPL+OREO)/Gross loans					0.35	%					0.35	%									0.54	%
NPA (NPL+OREO)/Total assets					0.27	%					0.28	%									0.45	%

Classified Assets

Classified loans at September 30, 2015 decreased $465,000 to $6.4 million compared with $6.9 million at June 30, 2015, and decreased $5.2 million compared with $11.6 million at September 30, 2014.

Classified assets to total assets ratio decreased 7 bps to 0.62% at September 30, 2015 compared with 0.69% at June 30, 2015, and decreased 80 bps compared with 1.43% at September 30, 2014.

The following tables provide some detail on classified loans and classified assets.

Classified loans (Dollars in thousands)
			Sept. 30 2015				Jun. 30, 2015					Percentage Change					Sept. 30, 2014					Percentage Change
Substandard (Classified)			$	6,423			$	6,888				-6.8	%				$	11,641				-44.8	%
Special mention				6,196				4,281				44.7	%					2,066				199.9	%
Total criticized				12,619				11,169				13.0	%					13,707				-7.9	%
Watch				22,504				31,987				-29.6	%					22,052				2.0	%
Total problem loans			$	35,123			$	43,156				-18.6	%				$	35,759				-1.8	%

Classified assets (Dollars in thousands)
			Sept. 30, 2015					Jun. 30, 2015					% Change				Sept. 30, 2014					% Change
Classified assets			$	6,423				$	6,888				-6.8	%			$	12,190				-47.3	%
Classified loans/Gross loans				0.79	%				0.87	%								1.63	%
Classified loans + Mention/Gross loans				1.56	%				1.41	%								1.92	%
Classified loans + Mention+Watch/Gross loans				4.35	%				5.44	%								5.00	%
Tier 1 + ALLL			$	104,376				$	101,746				2.6	%			$	94,158				10.9	%
Classified loans/Tier 1 + ALLL				6.15	%				6.77	%								12.36	%
Classified assets/Tier 1 + ALLL				6.15	%				6.77	%								12.95	%
Classified assets/Total assets				0.62	%				0.69	%								1.43	%

Capital

The following table illustrates Pacific City Bank capital ratios:

Capital Ratios
			September 30, 2015				June 30, 2015				September 30, 2014
Tier 1 Leverage Capital Ratio (Bank)			9.17	%			9.50	%			9.83	%
Common Equity Tier 1 Capital Ratio (Bank)			12.18	%			11.92	%			NA
Tier 1 Risk-Based Capital Ratio (Bank)			12.18	%			11.92	%			12.10	%
Total Risk-Based Capital Ratio (Bank)			13.39	%			13.16	%			13.35	%

About Pacific City Financial Corporation

Headquartered in Los Angeles, California, Pacific City Financial Corporation is the parent company of Pacific City Bank, a full-service commercial bank with nine branch offices and six loan production offices in Lynwood and Bellevue, Washington; Chicago, Illinois; Annandale, Virginia; Atlanta, Georgia; and Orange County, California. Pacific City Bank specializes in commercial banking for small to medium-size businesses by providing commercial real estate loans, small business loans and lines of credit, trade finance loans, auto loans, residential mortgage loans, and SBA loans. Pacific City Bank serves a diverse customer base through its branches in the Greater Los Angeles Area and New Jersey and its Loan Production Offices in five States.

Safe Harbor Statement

This press release may contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from the projected, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Pacific City Financial Corporation
Consolidated Balance Sheets (Unaudited)
(Dollars In thousands)
					September 30, 2015					June 30, 2015					% change				September 30, 2014					% change
Assets
	Cash and due from banks				$	12,987				$	14,862				-12.6	%			$	13,132				-1.1	%
	Interest-bearing deposits in financial institutions					96,881					88,757				9.2	%				38,671				150.5	%
		Total cash and cash equivalents				109,868					103,619				6.0	%				51,803				112.1	%
	Investment securities, available-for-sale					74,113					64,496				14.9	%				56,687				30.7	%
	Investment securities, held-to-maturity					17,603					16,093				9.4	%				10,756				63.7	%
		Total investment securities				91,716					80,589				13.8	%				67,443				36.0	%
	Loans held for sale					3,170					5,186				-38.9	%				5,717				-44.6	%
	Loans receivable, net of deferred loan costs (fees)					808,304					792,792				2.0	%				715,578				13.0	%
	Less: allowance for loan losses					(9,199	)				(9,258	)			-0.6	%				(9,925	)			-7.3	%
		Net loans receivables				799,105					783,534				2.0	%				705,653				13.2	%
	Premises and equipment, net					2,235					1,914				16.8	%				2,071				7.9	%
	Other real estate owned, net					-					-				NA					549				NA
	Federal Home Loan Bank and other bank stock					4,922					4,922				0.0	%				4,036				22.0	%
	Deferred tax assets, net					4,900					5,661				-13.4	%				4,894				0.1	%
	Servicing assets					7,188					7,113				1.1	%				6,640				8.3	%
	Accrued interest receivables					2,299					2,196				4.7	%				2,020				13.8	%
	Others					3,484					3,402				2.4	%				3,943				-11.6	%
	Total assets				$	1,028,887				$	998,136				3.1	%			$	854,769				20.4	%
Liabilities
	Deposits
		Noninterest-bearing demand			$	234,527				$	226,172				3.7	%			$	199,872				17.3	%
		Savings, NOW, and money market accounts				239,690					211,256				13.5	%				161,638				48.3	%
		Time deposits under $250,000				274,557					285,611				-3.9	%				246,252				11.5	%
		Time deposits of $250,000 and over				179,655					177,996				0.9	%				158,761				13.2	%
		Total deposits				928,429					901,035				3.0	%				766,523				21.1	%
	Borrowings					-					-				-					-				-
	Accrued interest payable					1,177					1,036				13.6	%				1,050				12.1	%
	Other liabilities					3,608					3,577				0.9	%				3,426				5.3	%
	Total liabilities				$	933,214				$	905,648				3.0	%			$	770,999				21.0	%
Capital
	Common stock					84,587					84,476				0.1	%				74,669				13.3	%
	Additional paid in capital					2,353					2,400				-2.0	%				2,406				-2.2	%
	Retained earnings					8,695					5,803				49.8	%				7,157				0.21
	Other comprehensive (loss) income					38					(191	)			-119.7	%				(462	)			-108.1	%
	Total capital					95,673					92,488				3.4	%				83,770				14.2	%
	Total liabilities & capital				$	1,028,887				$	998,136				3.1	%			$	854,769				20.4	%

Pacific City Financial Corporation
Consolidated Income Statements (Unaudited)
(Dollars in thousands, except share and per share data)
					Three Months Ended
					September 30, 2015				June 30, 2015					Percentage Change				September 30, 2014					Percentage Change
	Interest income
		Interest and fees on loans			$	10,501			$	10,204				2.9	%			$	9,144				14.8	%
		Interest on investments				361				296				22.0	%				301				19.9	%
		Interest on others				170				250				-32.0	%				98				73.6	%
		Total interest income				11,032				10,750				2.6	%				9,543				15.6	%
	Interest expense
		Interest on deposits				1,640				1,491				10.0	%				1,272				28.9	%
		Interest on borrowings				-				-				-					14				-100.0	%
		Total interest expenses				1,640				1,491				10.0	%				1,286				27.5	%
	Net interest income					9,392				9,259				1.4	%				8,257				13.7	%
	Provision (Reversal) for loan losses					95				169				-43.8	%				(672	)			-114.1	%
	Net interest income after PLL					9,297				9,090				2.3	%				8,929				4.1	%
	Non-interest income
		Gain on sale of SBA loans				1,669				2,086				-20.0	%				3,031				-44.9	%
		Gain on sale of residential mortgage loans				264				400				-34.1	%				2				13083.5	%
		Service charges on deposits				365				386				-5.5	%				362				0.8	%
		Loan servicing fees				516				467				10.6	%				459				12.5	%
		Other				320				233				37.1	%				306				4.4	%
		Total non-interest income				3,134				3,572				-12.3	%				4,160				-24.7	%
	Non-interest expense
		Employee salaries & benefits				4,164				4,387				-5.1	%				3,773				10.4	%
		Occupancies and fixed assets				932				876				6.4	%				841				10.8	%
		Legal & professional				531				592				-10.3	%				504				5.4	%
		FDIC assessment				120				126				-4.8	%				86				39.9	%
		Marketing expenses				195				286				-31.8	%				246				-20.6	%
		Data and item processing expenses				215				218				-1.4	%				195				10.2	%
		Loan related expenses				101				165				-38.8	%				179				-43.7	%
		Others				578				520				11.2	%				507				14.0	%
		Total non-interest expenses				6,836				7,170				-4.7	%				6,331				8.0	%
	Net income before taxes					5,595				5,492				1.9	%				6,758				-17.2	%
	Income tax provision					2,409				2,323				3.7	%				3,094				-22.1	%
	Net income				$	3,186			$	3,169				0.5	%			$	3,664				-13.0	%
	Dividend, accretion of disc, & interest on dividend					-				-				-					(56	)			-100.0	%
	Net income available for common shareholders				$	3,186			$	3,169				0.5	%			$	3,608				-11.7	%
	Earnings (loss) per common shares
		Basic			$	0.33			$	0.32				3.1	%			$	0.38				-13.2	%
		Diluted			$	0.32			$	0.32				-0.4	%			$	0.38				-15.8	%
	Average shares outstanding
		Basic				9,788,314				9,782,198									9,400,121
		Diluted				9,872,360				9,859,855									9,447,645

Pacific City Financial Corporation
Consolidated Income Statements (Unaudited)
(Dollars in thousands, except share and per share data)
				Nine Months Ended
				September 30, 2015					September 30, 2014					Percentage Change
Interest income
	Interest and fees on loans			$	30,331				$	25,927				17.0	%
	Interest on investments				945					909				3.9	%
	Interest on others				521					245				112.6	%
	Total interest income				31,797					27,081				17.4	%
Interest expense
	Interest on deposits				4,613					3,627				27.2	%
	Interest on borrowings				-					40				-100.0	%
	Total interest expenses				4,613					3,667				25.8	%
Net interest income					27,184					23,414				16.1	%
(Reversal) Provision for loan losses					(20	)				(1,772	)			-98.9	%
Net interest income after PLL					27,204					25,186				8.0	%
Non-interest income
	Gain on sale of SBA loans				5,270					6,283				-16.1	%
	Gain on sale of residential mortgage loans				964					275				250.5	%
	Service charges on deposits				1,109					973				14.0	%
	Loan servicing fees				1,541					1,305				18.1	%
	Net gain on OREO				-					33				-100.0	%
	Other				757					635				19.2	%
	Total non-interest income				9,641					9,504				1.4	%
Non-interest expense
	Employee salaries & benefits				12,567					11,100				13.2	%
	Occupancies and fixed assets				2,656					2,405				10.4	%
	Legal & professional				1,805					1,304				38.4	%
	FDIC assessment				367					300				22.4	%
	Marketing expenses				755					699				8.1	%
	Data and item processing expenses				652					582				12.0	%
	Loan related expenses				400					493				-18.9	%
	Others				1,571					1,474				6.6	%
	Total non-interest expenses				20,773					18,357				13.2	%
Net income before taxes					16,072					16,333				-1.6	%
Income tax provision					6,790					6,872				-1.2	%
Net income				$	9,282				$	9,461				-1.9	%
Dividend, accretion of disc, & interest on dividend					-					(336	)			-100.0	%
Net income available for common shareholders				$	9,282				$	9,125				1.7	%
Earnings (loss) per common shares
	Basic			$	0.95				$	0.98				-2.9	%
	Diluted			$	0.94				$	0.97				-3.2	%
Average shares outstanding
	Basic				9,780,549					9,336,074
	Diluted				9,853,161					9,375,972

Pacific City Financial Corporation
Average Balance, Average Yield, and Average Rate
(Dollars in thousands)
			Three Months Ended
			September 30, 2015											June 30, 2015											September 30, 2014
			Average Balance				Interest Income/ Expense				Average Yield/ Rate			Average Balance				Interest Income/ Expense				Average Yield/ Rate			Average Balance				Interest Income/ Expense				Average Yield/ Rate
Assets
Interest-earning assets:
	Gross loans, net of deferred loan fees		$	813,578			$	10,500			5.12	%		$	795,161			$	10,204			5.15	%		$	692,613			$	9,145			5.24	%
	US government agencies			13,975				71			2.04	%			9,081				34			1.48	%			3,614				18			2.05	%
	Mortgage backed securities			42,021				184			1.75	%			37,202				167			1.80	%			37,619				177			1.88	%
	Collateralized mortgage obligation			22,552				82			1.46	%			21,992				81			1.47	%			26,579				102			1.54	%
	Muni bonds			5,741				24			1.66	%			3,784				14			1.51	%			245				2			3.27	%
	Interest bearing deposit & others			89,941				57			0.25	%			47,522				30			0.25	%			41,587				26			0.25	%
	Total interest-earning assets		$	987,808			$	10,918			4.39	%		$	914,742			$	10,530			4.62	%		$	802,257			$	9,470			4.68	%
Noninterest-earning assets:
	Cash and cash equivalents		$	13,973										$	14,919										$	14,120
	Allowances for loan losses			(9,279	)										(9,663	)										(10,861	)
	Other assets			25,048											25,024											24,330
			$	29,742										$	30,280										$	27,589
Total assets			$	1,017,550										$	945,022										$	829,846
Liabilities and Stockholders' Equity
Interest-bearing liabilities:
	Deposits:
	Money market & NOW accounts		$	224,565			$	488			0.86	%		$	192,014			$	405			0.85	%		$	151,315			$	305			0.80	%
	Savings			6,994				5			0.30	%			6,978				5			0.29	%			6,897				5			0.29	%
	Time deposits			457,533				1,146			0.99	%			435,930				1,082			1.00	%			393,050				962			0.97	%
			$	689,092			$	1,639			0.94	%		$	634,922			$	1,492			0.94	%		$	551,262			$	1,272			0.92	%
	Borrowings:
	Other borrowings:			-				-			NA				212				0			0.00	%			-				-			NA
	Subordinated debentures			-				-			NA				-				-			NA				844				13			6.32	%
			$	-			$	-			NA			$	212			$	0			0.00	%		$	844			$	13			6.32	%
	Total interest-bearing liabilities		$	689,092			$	1,639			0.94	%		$	635,134			$	1,492			0.94	%		$	552,106				1,285			0.92	%
Noninterest-bearing liabilities:
	Demand deposits		$	229,390										$	214,262										$	192,546
	Other liabilities			4,552											4,003											4,373
			$	233,942										$	218,265										$	196,919
Total liabilities			$	923,034										$	853,399										$	749,025
Stockholders' equity			$	94,516										$	91,623										$	80,821
Total liabilities and stockholders' equity			$	1,017,550										$	945,022										$	829,846
Net interest income							$	9,279										$	9,038										$	8,185
Cost of funds											0.71	%										0.70	%										0.68	%
Net interest spread											3.44	%										3.68	%										3.76	%
Net interest margin											3.73	%										3.96	%										4.05	%

Pacific City Financial Corporation
Average Balance, Average Yield, and Average Rate
(Dollars in thousands)
				Nine Months Ended
				September 30, 2015													September 30, 2014
				Average Balance					Interest Income/ Expense				Average Yield/ Rate				Average Balance					Interest Income/ Expense				Average Yield/ Rate
Assets
Interest-earning assets:
	Gross loans, net of deferred loan fees			$	791,484				$	30,331			5.12	%			$	654,236				$	25,927			5.30	%
	US government agencies				10,078					123			1.63	%				3,428					51			1.99	%
	Mortgage backed securities				38,389					536			1.86	%				36,532					525			1.92	%
	Collateralized mortgage obligation				21,738					242			1.48	%				27,851					325			1.56	%
	Muni bonds				3,573					44			1.65	%				246					7			3.66	%
	Interest bearing deposit & others				60,548					114			0.25	%				36,118					67			0.25	%
	Total interest-earning assets			$	925,810				$	31,390			4.53	%			$	758,411				$	26,902			4.74	%
Noninterest-earning assets:
	Cash and cash equivalents			$	14,374												$	15,586
	Allowances for loan losses				(9,515	)												(11,676	)
	Other assets				24,432													24,232
				$	29,291												$	28,142
Total assets				$	955,101												$	786,553
Liabilities and Stockholders' Equity
Interest-bearing liabilities:
	Deposits:
	Money market & NOW accounts			$	200,600				$	1,278			0.85	%			$	141,789				$	832			0.78	%
	Savings				6,795					15			0.30	%				6,840					15			0.29	%
	Time deposits				437,696					3,320			1.01	%				378,011					2,779			0.98	%
				$	645,091				$	4,613			0.96	%			$	526,640				$	3,626			0.92	%
	Borrowings:
	Other borrowings				71					0			0.17	%				1					0			0.00	%
	Subordinated debentures				-					-			-					850					40			6.29	%
				$	71				$	0			0.17	%			$	851				$	40			6.29	%
	Total interest-bearing liabilities			$	645,162				$	4,613			0.96	%			$	527,491				$	3,666			0.93	%
Noninterest-bearing liabilities:
	Demand deposits			$	213,872												$	176,828
	Other liabilities				4,556													3,333
				$	218,428												$	180,161
Total liabilities				$	863,590												$	707,652
Stockholders' equity				$	91,512												$	78,901
Total liabilities and stockholders' equity				$	955,101												$	786,553
Net interest income									$	26,777												$	23,236
Cost of funds													0.72	%												0.70	%
Net interest spread													3.58	%												3.81	%
Net interest margin													3.87	%												4.10	%

View source version on businesswire.com: http://www.businesswire.com/news/home/20151027007091/en/