Saehan Bancorp Reports Second Quarter Results

LOS ANGELES--([ BUSINESS WIRE ])--Saehan Bancorp (OTCBB:SAEB) today announced financial results for its second quarter ended June 30, 2012 a" reflecting an increase in total assets, deposits and a decrease in nonperforming loans.

"We made a significant progress in improving asset quality in the second quarter of 2012, and continue to focus on implementing various cost-savings initiatives to further improve operating results"

The company reported a net loss of $259,000, or $0.001 per share for the second quarter of 2012 compared with net income of $368,000, or $0.002 per diluted share, in the same period a year ago. The return on average equity for the second quarter of 2012 was -1.78 percent and the return on average assets was -0.17 percent compared with 3.22 percent and 0.26 percent, respectively, for the second quarter of 2011.

Additional highlights for the second quarter of 2012 include:

Total assets at June 30, 2012 increased 11.3 percent to $608.7 million from $546.7 million a year ago.
Net loans were $351.1 million at June 30, 2012 compared with $377.7 million last year.
Total deposits at June 30, 2012 increased 10.8 percent to $521.9 million from $471.1 million at June 30, 2011.
Net interest margin for the second quarter of 2012 was 2.42 percent compared with 2.91 percent reported in the same period a year ago.
Efficiency for the second quarter of 2012 was 104.7 percent compared with 94.0 percent in the second quarter of 2011.
Nonperforming loans at June 30, 2012 decreased to $10.1 million from $23.4 million at June 30, 2011.

aWe made a significant progress in improving asset quality in the second quarter of 2012, and continue to focus on implementing various cost-savings initiatives to further improve operating results,a said Dong Il Kim, president and chief executive officer.

Net interest income before provision for loan losses was $3.6 million in the second quarter of 2012 compared with 4.0 million in the second quarter of 2011. For the second quarter of 2012, net interest margin was 2.42 percent compared with 2.91 percent in the second quarter of 2011. Net interest income and margin decreased as a result of reducing the non-performing loans. Cost of funds and yield on earnings assets for the second quarter of 2012 were 1.29 percent and 3.52 percent, respectively, compared with 2.03 percent and 4.64 percent, respectively, for the second quarter of 2011.

Noninterest income in the second quarter of 2012 totaled $1.9 million compared with $2.2 million in the second quarter of 2011. The decrease in noninterest income is primarily attributable to the $484,000 decrease in gain on sale of loans and $420,000 loss on sale of OREOs, partially offset by $790,000 of gain on sale of investment securities.

Noninterest expense for the second quarter of 2012 was $5.8 million, unchanged from the second quarter of 2011. The $269,000 increase in employee salaries and benefit expense was partially offset by the $258,000 reduction in occupancy and equipment expense in the second quarter of 2012.

The efficiency ratio for the second quarter of 2012 was 104.7 percent compared with 94.0 percent in the second quarter of 2011.

Nonperforming loans and OREO were $12.3 million at June 30, 2012, compared with $30.0 million at June 30, 2011. Nonperforming assets represented 2.0 percent of total assets at June 30, 2012.

Shareholdersa equity was $58.1 million at June 30, 2012 compared with $45.9 million at June, 2011. Shareholdersa equity primarily increased as a result of a $12.0 million common stock equity offering completed in September 2011 and positive earnings in the prior quarters. Capital ratios remained to be well above the aWell-Capitalizeda guidelines established by the regulatory agencies. The Leverage Ratio, Tier 1 Risk-based Capital Ratio and Total Risk-based Capital Ratio at June 30, 2012 were 12.7 percent, 22.1 percent and 20.6 percent, respectively, compared with 10.8 percent, 17.0 percent and 14.6 percent, respectively at June 30, 2011.

About Saehan Bancorp

Saehan Bancorp is a bank holding company with headquarters in Los Angeles, California. Its wholly owned subsidiary, Saehan Bank, offers a comprehensive range of financial solutions to meet the needs of the Korean-American community in Los Angeles. Saehan Bancorp is committed to satisfying customers and creating shareholder value. Its ten retail branch offices, International Department, and SBA Department of Saehan Bank focus on fulfilling these commitments to customers and shareholders.

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 abelieve,a aexpect,a aanticipate,a aintend,a aplan,a aestimate,a or words of similar meaning, or future or conditional verbs such as awill,a awould,a ashould,a acould,a or amay.a


Saehan Bancorp
Condensed Balance Sheet
(Dollars in thousands)

	30-Jun
	2012	2011
Assets:
Cash & due from banks - demand	16,706	12,250
Due from banks-interest bearing	195,275	67,394
Federal fund sold	5,540	36,710
Securities available-for-sale	27,434	30,430
Loans	366,859	400,687
Less: Allowance for loan losses	15,808	22,940
Net loans	351,051	377,747
Loans held for sale	652	2,984
Bank premises and equipment, net	1,871	2,443
Other real estate owned	2,176	6,635
Other assets	7,959	10,145
Total assets	608,664	546,738

Liabilities and stockholders' equity:
Deposits:
Noninterest bearing demand	143,127	130,423
Interest bearing demand and savings	171,760	239,894
Time deposits	206,998	192,370
Total deposits	521,885	471,120
Other liabilities	28,690	29,674
Total liabilities	550,575	500,794
Total stockholders' equity	58,089	45,944
Total liabilities and stockholders' equity	608,664	546,738
Book value per share	0.24	0.24
Period end shares outstanding	237,197,874	189,097,874
Nonperforming loans	10,076	23,363

Tier I leverage ratio	12.74%	10.81%
Tier 1 risk-based capital ratio	20.62%	14.55%
Total risk-based capital ratio	22.08%	17.00%


Saehan Bancorp
Condensed Income Statement and Comprehensive Income
(Dollars in thousands except per share data)

	For the three						For the six
	months ended						months ended
	30-Jun						30-Jun
		2012			2011			2012			2011
Interest income:
Interest and fees on loans		4,919			6,093			10,249			12,552
Interest on securities		133			201			295			473
Interest on federal funds sold		24			27			51			53
Other interest income		156			79			282			140
Total interest income		5,232			6,400			10,877			13,218
Interest expense:
Deposit		1,467			2,218			2,933			3,920
Other		170			161			344			1,110
Total interest expenses		1,637			2,379			3,277			5,030
Net interest income before provision for loan losses		3,595			4,021			7,600			8,188
Provision for loan losses		-			-			-			-
Non-interest income:
Service charges on deposit accounts		401			486			819			993
Gain on sale of loans		671			1,155			671			1,908
Gain on sale of investment securities		790			-			790			3
Gain (loss) on sales of OREO		(420	)		79			(420	)		400
Other operating income		495			437			1,127			911
Total non-interest income		1,937			2,157			2,987			4,215
Non-interest expense:
Salaries and employee benefits		2,555			2,286			4,787			4,437
Net occupancy and equipment expense		954			1,212			2,014			2,380
Other operating expense		2,281			2,312			3,933			4,392
Total non-interest expenses		5,790			5,810			10,734			11,209
Income before income taxes		(258	)		368			(147	)		1,194
Income taxes		1			-			3			1
Income before extraordinary items		(259	)		368			(150	)		1,193
Extraordinary items, net of taxes		-			-			-			-
Net income		(259	)		368			(150	)		1,193
Net income per share -
Basic	$	(0.001	)	$	0.002		$	(0.0006	)	$	0.006
Diluted	$	(0.001	)	$	0.002		$	(0.0006	)	$	0.006

Basic average common shares outstanding		237,197,874			189,097,874			237,197,874			189,097,874
Diluted average common shares outstanding		237,221,149			189,097,874			237,285,658			189,097,874

Charge offs		1,482			4,741			2,552			7,868
Recoveries		381			3,790			1,139			4,623

	For the three						For the six
	months ended						months ended
	30-Jun						30-Jun
		2012			2011			2012			2011
Key Operating Ratios:
Return on average assets		-0.17	%		0.26	%		-0.05	%		0.42	%
Return on average equity		-1.78	%		3.22	%		-0.51	%		5.28	%
Yield on earning assets		3.52	%		4.64	%		4.03	%		4.64	%
Cost on interest bearing liabilities		1.29	%		2.03	%		1.79	%		2.55	%
Net interest margin		2.42	%		2.91	%		2.82	%		2.87	%
Cost of funds		1.25	%		1.85	%		1.32	%		1.92	%
Efficiency ratio		104.66	%		94.04	%		101.39	%		90.37	%

N@N

Saehan Bancorp Reports Second Quarter Results