A major lender to Los Angeles’ Korean American community has broadened its footprint in the local business banking market.
Downtown-based Bank of Hope closed its acquisition of SMBC Manubank’s commercial banking unit on Oct. 1, adding $2.3 billion in loans and $2.6 billion in deposits. The deal, first announced in late March, will also see Bank of Hope inherit Manubank’s seven commercial banking branches in Southern California.
“By bringing together Manubank’s experienced bankers and longstanding client relationships with our broader banking platform, we are expanding our commercial capabilities to better serve our customers and introducing new opportunities to strengthen client engagement,” said Kevin Kim, Bank of Hope’s chief executive.
With $18.5 billion in assets, Bank of Hope is the fourth largest bank headquartered in L.A., formed in 2016 through the merger of commercial-heavy lenders BBCN Bank and Wilshire Bank. Before its expansion and take-over of Manubank’s commercial banking locations, it operated 45 branches in six states under the Bank of Hope banner and 28 more in Hawaii as Territorial Savings.
Aligning priorities
The bank hopes bringing on Manubank’s business will diversify its deposit mix and lower the percentage of certificates of deposit in its book, said Julianna Balicka, Bank of Hope’s chief financial officer, in the bank’s second-quarter earnings call. CDs are a “preferred product” for the bank’s core customer base, she said, but carry higher interest costs and lock in rigid terms that can hurt profitability.
“This transaction aligns with our priorities to expand our middle market and multinational banking capabilities, develop specialty deposit verticals, broaden our presence in our core Southern California market, and enhance our balance sheet with quality loans and attractive deposits,” Kim said in the earnings call.
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