Wilshire Bancorp, Inc. (WIBC) CEO Discusses Q2 2013 Results - Earnings Call Transcript

Jul.23.13 | About: Hope Bancorp, (HOPE)

Wilshire Bancorp, Inc. (WIBC) Q2 2013 Earnings Conference Call July 23, 2013 2:00 PM ET

Executives

Edward Han - First Vice President of Investor Relations

Jae Whan Yoo - President, Chief Executive Officer, Director

Alex Ko - Chief Financial Officer, Executive Vice President

Peter Koh - Senior Vice President, Chief Credit Officer

Analysts

David Threadgold - KBW

Don Worthington - Raymond James

Aaron Deer - Sandler O'Neill & Partners

John Deysher – Pinnacle

Operator

Good day ladies and gentlemen and welcome to the Second Quarter 2013 Wilshire Bancorp Earnings Conference Call. My name is Philip and I will be your operator for today. At this time, all participants are in listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions) As a reminder this conference is being recorded for replay purposes.

I would now like to turn the conference over to your host for today Mr. Edward Han of Investor Relations. Please proceed sir.

Edward Han

Thank you, and good morning, everyone. We appreciate you joining second quarter 2013 conference call. Again, I am Edward Han and joining me are J. W. Yoo, the Company's President and Chief Executive Officer; Alex Ko, our Executive Vice President and Chief Financial Officer; and Peter Koh, our Senior Vice President and Chief Credit Officer. Yesterday, Wilshire Bancorp issued its second quarter 2013 financial results, which can be accessed either through the Investors Relations tab at wilshirebank.com or from the various financial news websites. This call is being webcast and will be available and archived for one year on the Company's website.

Before we begin, I must remind you that during this call we may make certain statements concerning Wilshire's future performance or events. Any such comments constitute forward-looking statements and are subject to a number of risks and uncertainties that might cause actual results to differ materially from the stated expectations. These factors include, but are not limited to the ability to grow market share in our markets, including New York and Los Angeles, success of new branches, marketing costs, loan growth and balance sheet management, credit quality, our ability to collect on past due loans, deposit generation, net interest margin expectations, interest rate exposure, global and local economic conditions and other risks detailed in the most recent reports on Form 10-K and Form 10-Q as filed with the Securities and Exchange Commission.

Given these uncertainties, undue reliance should not be placed on such forward-looking statements. Wilshire Bancorp is under no obligation to update this information as future events or developments take place that may change these forward-looking statements.

Mr. Yoo will begin the call by providing an overview of the highlights of the quarter and Mr. Alex Ko will review our financial results in more detail. And then Mr. Peter Koh will discuss our asset quality. Mr. Yoo will provide some closing comments and we will then commence the question-and-answer portion of the call.

With that, I will now turn the call over to our Chief Executive Officer, Mr. Yoo? Mr. Yoo.

Jae Whan Yoo

Thank you, Edward. And thank you all for joining us today for this call. Good morning everyone. We are pleased with our results in the second quarter which will reflect a very consistent level of our performance. We generated a net income available to common shareholders of $11.5 million or $0.16 per share.

On a pre-provision pre-tax basis, we had $17 million in income during the second quarter of 2013 an increase of 38% compared to $12.3 million generated in the same period of 2012. We continued to generate a very strong level of profitability consistent with our goal of being high a performing bank.

On an annualized basis, we generated a return on average assets of 1.67% and a return on average equity of 12.95%. Despite a low insurance rate environment that makes growth in spread income very challenging, we were able to generate overall revenue growth of 4% over the second quarter of last year. Our ability to manage our expenses levels and keep our credit cost low as it helped to us generate the strong lead times we have seen this year.

We had loan production of $194.8 million in the second quarter up slightly from last year quarter or below the level we saw in 2012. However, originations for the second quarter of 2012 included $50 million increase in warehouse lending lines result as the increase originations for the second quarter of 2012 totaled $195.2 million only slightly higher than second quarter 2013.

Competition for quality loans continues to be intense with both large national banks and the Korean-American banks being highly aggressive in pricing. These highly competitive environment has had an impact on our loan production, as we have chosen not to originate the loans that we do not believe are adequately priced of credit risk that would add too much duration risk to our portfolio.

However, it appears that we have – we maybe near or at the bottom in terms of loan pricing. Over the past several weeks we have seen pricing on the most attractive loans increase from 3.5% to 4% range to the 4.5% range. If risk continue to be at the current levels, our new loan production should be more supportive to our net interest margin than it has been over the past several quarters.

We had a very strong second quarter in terms of SBA loan production. We originated $40 million in SBA loans and increase of approximately $13 million from prior quarter. However, the premiums on SBA loan sales declined by approximately 1.2% points which reduced our gain on sale income in the second quarter.

Of course the most significant recent events was announced acquisition of BankAsiana and Saehan Bancorp as we indicated at the beginning of the year given the improved performance of the bank and our strong capital position we felt we were in a good position to become more active in our deployment of the excess capital. And our preference was to use our capital in ways that either contributes to the growth and the profitability of our franchise.

In both the BankAsiana and Saehan transactions, we believe we have identified excellent opportunities to profitably deploy our capital. In the BankAsiana transaction, we haven’t been able to significantly increase our East Coast franchise and further diversify our loan portfolio.

We will double the size of our presence in the New York, New Jersey market and move to a top three position in terms of a market share among Korean banks. BankAsiana was appealing to us for a number of reasons. The first, it has a healthy strong and attractive balance sheet which will require low marks to their loan and security portfolios. They are more of a C&I lender than we are with about 32% of their outstanding loans being C&I, so this will help us to reduce our concentration of the CRE loans.

Second, BankAsiana has been very successful in building its customer base and consistently adding new client relationships. We will be adding some strong relationship officers. And with the higher lending limits that we can offer, there should be some good opportunities to increase lending relationships within their existing customer base. And the third, there is a significant overlap in our operation, which we believe we’ll provide meaningful opportunities to enhance our overall efficiencies. When all the cost savings are phased in, we expect to reduce BankAsiana’s non-interest expense by close to 50%.

Turning to the Saehan acquisition as a bank that we have competed against for many years in Los Angeles area, we know the company very well and we are comfortable that the projections we have made for the synergies are achievable. Saehan’s customer base and the business model are very similar to ours. So anticipate that we will have a small integration under the very successful in customer retention.

As with the BankAsiana, we have a significant overlap in our operations with the eight out of 10 Saehan branches being located within one mile of a Wilshire branch. This should provide a high level of cost savings as we integrated Saehan and we are projecting that we can take out $12.3 million from the combined operating expense base.

We expect that 75% of the cost of saving will be revised in 2014 with 100% being utilized thereafter. We also believe there are good opportunities to the structure Saehan’s balance sheet to enhance the amount of net interest income generated from their operations. Saehan net interest margin in the first quarter of 2013 was just 2.57%. This is partially due to the fact that they had 23% of their assets in cash and the cash equivalence.

Upon closing, we will redeploy these assets at the very least to pay down our Federal Home Loan Bank advances. There is also room to bring down their deposit cost particularly in their prime deposits where they have a $30 million in broker deposit with an interest rate of 3.4% that mature in early 2014.

Finally, Saehan has a significantly deferred tax asset valuation allowances that will be available for us to use. On a preliminary basis, we expect a value of the DDA to be at least $11.5 million. In both acquisitions, there will be immediately accretive when restructuring costs are excluded and we are projecting internal rate of returns in excess of 20%.

Let me add the acquisitions of BankAsiana and the Saehan, this will have a total assets of more than $3.5 billion. We expect that this acquisition will be give us enhanced scale and efficiencies that will lead to improved earnings power and we will be clearly positioned as one of the two leaders nationally in the Korean-American banking industry.

Now, let me turn the call over to Alex Ko, our Chief Financial Officer for further review of the second quarter financials. Alex?

Alex Ko

Thank you J.W. and hello everyone. I will begin by discussing our income statement. Net interest income before provision for loan losses was $25.8 million in the second quarter of 2013, up slightly from the first quarter of 2013. Our net interest margin was 4.06% in the second quarter of 2013 compared with 4.09% last quarter. Given the continued pressure on loan yield due to the low interest rate environment, we were pleased that we were able to keep our net interest margin relatively stable in the second quarter.

Loan yields were 5.1% in the second quarter of 2013, down from 5.21% in the prior quarter. Consistent with the prevailing interest rate environment, we continue to see older loans with the higher rates being paid off over refinance. While new loans in both the CRE and the C&I portfolios are both have lower rate than the existing portfolio. This combination has placed pressure on our loan yield. We were able to wisely offset the lower loan yield through our improvement in our overall deposit mix and a reduction in our cost of deposit. Our cost of total deposits declined to 51 basis points for the second quarter of 2013 down from 53 basis points in the prior quarter. We continue to have a good success in bringing in core deposits which has allowed us to steadily runoff some of our higher cost time deposits.

As Mr. Yoo mentioned, we have seen rate increase on new loan productions over the past several weeks. If this trend continues, we would expect to see less compression in our net interest margin going forward. In addition, so far in the third quarter we have made some small purchase of investment securities with yields in the 280 basis points to 290 basis point range which should also positively impact our margin.

Turning to non-interest income, we generated $8.3 million in the second quarter of 2013 compared to $8.7 million last quarter. The decrease was due to a lower gain on sale of loans. We have $3.1 million in net gains this quarter compared with $3.5 million last quarter. We sold approximately $30.6 million of SBA loans in the second quarter which is only 300,000 more than we sold last quarter. However, the average premium on the SBA loan sales declined from approximately 11.5% to 10.3% accounting for the lower gain on sale.

Our non-interest expense was $17.1 million in the second quarter compared to $17.3 million in the prior quarter. Our salaries and benefit expenses increased to $9.5 million in the second quarter from $8.8 million last quarter. The increase was primarily due to higher bonus accruals due to our strong performance and across the board salary increases that took effect during the second quarter. This was offset by lower other non-interest expenses which was primarily due to a reduction in professional fees and expenses related to bank owned life insurance.

Moving to taxes, we recorded provisions for income taxes of $5.5 million which equals to an effective tax rate of 32.1%. This is the lower than our historical rate, as we have some more tax credits available than in the past due to our investment in affordable housing program. We expect that our effective tax rate will remain in this range for the rest of 2013. Our gross loans receivable was $2.1 billion at June 30, 2013 up from $2.06 billion at the end of the prior quarter. We experienced an increase in our loan receivable categories apart from consumer loans lead by an increase in commercial and industrial loans of $23.3 million.

Our total deposits were $2.18 billion at June 30, 2013 up from $2.16 billion at the end of the prior quarter. Within the various deposit categories we had increases in our non-interest bearing demand deposits and savings and interest checking deposits which enabled us to runoff some of our higher cost time deposits.

With a continued growth in non-interest bearing demand deposits, this category represented 28.6% of our total deposit at June 30, 2013 up from 23.6% a year earlier. However, we have loan loss non-interest bearing demand deposit balance that we consider to be temporary. As the customer deposited his funds after the sale of property that intends to reinvest the cash into another opportunity. Accordingly, it is possible that we could see our non-interest bearing demand deposit balance decrease next quarter due to the outflow of this account.

During the second quarter of 2013, we committed to fund the true Low Income Housing Tax Credit investment totaling $8 million. We continue to be in a very strong capital position. At June 30, 2013, we had to ensure one leverage ratio of 14.67%, a Tier-1 risk-based capital ratio of 18.73%. Total risk-based capital ratio of 20% and a TCE ratio of 12.51%.

We also began to implement our stock repurchase program during the second quarter. We spend $4.3 million to repurchase 651,404 shares around average price of $6.56. As of June 30, 2013, we had still approximately 80% of the repurchase authorizations available for use.

I will now turn the call over to Peter Koh, our Chief Credit Officer for the discussion of our asset quality and trends. Peter?

Peter Koh

Thank you, Alex. We had another solid quarter of improvement in asset quality, the declines in most of our problem loan categories. This is reflected by our continued progress in working out and resolving previously identified problem loans as well as general improvement in the health of our borrowers.

In particular, we had a $25 million decline in special mention or criticized loans, which was attributable to the successful payoff of a $10.3 million loan as well as a number of upgrades to smaller loans after a review of updated financial information showed improvement in cash flows.

Our total loan delinquency has declined by approximately $1 million to $8.8 million at June 30 and continued to remain at low and manageable levels. Our total classified loans which are loans graded as sub-standard doubtful and loss declined by approximately $8.8 million to $145 million at June 30.

Total outflow from classified loans were $17.7 million in the second quarter which included $6.3 million that was paid-off, $4.1 million that was charged off and $2.6 million that was upgraded.

Inflow into classified loans was $8.9 million down from $12 million last quarter. Total non-accrued loans increased $1.6 million during the second quarter of 2013 to $26.7 million at June 30, 2013. This increase is a reflection of the banks continued enough activities of previously identified problem loans. We had $5.9 million flow out of total non-accruals in the second quarter which included $4.1 million that was charged off and $1.1 million that was paid off.

Total inflow was $7.5 million in the second quarter up from $1.6 million last quarter. Our gross loan charge-offs were $4.4 million in the second quarter compared with $5.6 million in the prior quarter. The largest components of our second quarter charge-offs were two loans secured by carwash properties totaling $2.1 million. Both of these credits have been properly classified and on non-accrual status for several quarters.

Given the improvement we saw in most of our credit metrics this quarter, we determined that no provision for credit losses was required. As a result as of June 30, 2013, we had an allowance, our loan losses are $54.9 million or 2.62% of gross loans out for investments. We also had 198% coverage of our non-performing assets.

Now, I will turn the call back to our Chief Executive Officer, Mr. Yoo. Mr. Yoo?

Jae Whan Yoo

Thank you, Peter.

As we announced a few weeks ago Peter has to be promoted to Chief Credit Officer following the departure of Jack Choi, who left to pursue an opportunity to be a CEO at another bank. We are very fortunate to have a well-qualified individual already in-house for the Chief Credit Officer position. Peter has been with Wilshire for approximately 10 years having served at the positions of Deputy Chief Credit Officer. Over the past few years he was instrumental in walking the trajectory to implement improvements throughout our credit administration processes and effectively resolving the inventory of the problem loans we had after the financial crisis.

Under Peter’s leadership we will continue to ingrain our strong credit culture throughout the entire organization. As we wrap up today, I would like to make a few comments about our performance so far this year.

I think we are starting to move in the right direction in spite a sluggish economy we haven’t been able to generate a very strong returns and good growth in our core earnings. We would expect to see a continuation of these trends during the second half of the year. And as we indicated at the beginning of the year, we have been more active in deploying our excess capital.

Our actions in the second quarter reflect the balanced approach that we have taken to capital deployment. We started returning cash to shareholders by implementing our stock repurchase program and also initiating our quality cash dividend. And with announced acquisitions of BankAsiana and Saehan, we have been able to utilize our capital to expand our franchise and increase our earnings power in the year or so ahead. After the acquisitions close, we were still very well-capitalized which continue to give us the flexibility to continue returning cash to shareholders as well as we invest in our business so that we can continue to drive profitable growth.

We are very pleased with the current position of the bank and we believe we have built a good foundation opportunity to create additional value for shareholders in the years ahead. Thank you for being with us this morning.

Edward Han

Thank you, Mr. Yoo. That concludes our formal presentation. And at this time, we will like to open the call for questions.

Question-and-Answer Session

Operator

(Operator Instructions) And your first question comes from the line of Julianna Balicka from KBW. Please proceed.

David Threadgold - KBW

This is actually Dave in for Julianna.

Jae Whan Yoo

Hi, Dave.

David Threadgold - KBW

I just had a question on the cash for this quarter. You mentioned that part of it was due to the temporary increase in customer -- the business demand deposits that came out in the second quarter. Could you let us know how -- what's the dollar amount of that deposit and how late in the quarter that came out?

Jae Whan Yoo

Sure. As we mentioned during the second quarter of 2012 cash and yield from banks increased $75.7 million or 87% from $86.9 million to $152.6 million at the end of the 2013. The increase is actually primarily like a three factor, the first and the biggest one is customer counts that you just mentioned. We had one large borrower who sold their property and they put a non-interest bearing account. The initial amount was about $50 million. However, since customer wanted to invest on other products – properties, he actually withdraw about $30 million.

So that left about $20 million of temporarily DDA increase. We would expect that will decrease going forward. And also another component of the increase of the cash and cash equivalent was the reduction on the warehouse lending, poor balance of the warehouse decreased about $40 million. And this warehouse lending is more fluctuate quarter-over-quarter or even month-to-month, but there was some fluctuation, but the fluctuation was a decrease by about $40 million and the remaining about $20 million is about the net change on the loan such as payoff or principal pay-down.

Going forward we would expect that cash and that yield from bank balance will decrease about like a $50 million, so we would expect about $110 million or $100 million of cash and different banks going forward and we will utilize that by reducing the FHLB borrowings and so forth.

David Threadgold - KBW

Okay. That’s very helpful. And on the loan yields what kind of yields are you seeing in new originations both for C&I and CREs?

Alex Ko

Yes. As we mentioned in our original presentation we have been seeing some bottoming in terms of the pricing and so we have seen some short trends in increasing these rates. Generally we’re looking at the prime borrowers on a real-estate, we’re looking at may be 4% to 4.5% and we are getting higher yields from borrowers that are of less credit worthiness. So we are trying to balance the originations with protecting our profitability and we’re seeing signs that the market is allowing for that.

David Threadgold - KBW

Thank you. I will sit back.

Alex Ko

Thank you.

Operator

(Operator Instructions) And your next question comes from Don Worthington from Raymond James. Please proceed.

Don Worthington - Raymond James

Hi, good morning everyone.

Jae Whan Yoo

Good morning, Don.

Alex Ko

Good morning, Don.

Peter Koh

Good morning.

Don Worthington - Raymond James

Were there any merger costs in the – in this quarter for the two acquisitions that were announced that you would consider to be kind of non-recurring?

Jae Whan Yoo

No, not at this quarter because even though we announced that this quarter the actual cost will incur in the third quarter and until it closes. And we would except to have both deals to be closed by end of this year.

Don Worthington - Raymond James

Okay. And then in terms of CRE lending, are there any segments within the commercial real estate portfolio that you would consider to be showing any signs of weakness in terms of type of property?

Peter Koh

Yes, in terms of weakness right now actually we are seeing general improvement in most of our CRE lending areas and we’re seeing pickups in several different industries such as the hospitality industry. So in general I think the trend is improving although the interest rate environment which has been changing over the last several weeks is putting some upward pressure in terms of cap rates. So we are watching that closely but it’s balanced and I think the economy seems to still be picking up slowly as these rates are going up. So we will have to monitor that closely, but in general we’re not seeing too much weakness anywhere.

Don Worthington - Raymond James

Okay. Thank you. And then my last question, were there any loan purchases in the quarter to augment the originations?

Peter Koh

No, there was not.

Don Worthington - Raymond James

Okay. Thank you.

Peter Koh

Thank you.

Operator

Your next question comes from Aaron Deer from Sandler O'Neill & Partners. Please proceed.

Aaron Deer - Sandler O'Neill & Partners

Hi, good morning guys.

Jae Whan Yoo

Good morning, Aaron.

Alex Ko

Good morning, Aaron.

Aaron Deer - Sandler O'Neill & Partners

Hi, I’m going to apologize in advance, I got on the call late, so it’s possible my questions have already been addressed. But first J.W. we want to congratulate you on the Saehan deal think that’s terrific news and I wish you luck with that as it proceeds.

Jae Whan Yoo

Thank you very much, Aaron.

Aaron Deer - Sandler O'Neill & Partners

The SBA activity in the quarter, I was surprised to see your premiums on SBA loan sales have declined. Some of the other banks had reported previously that they were actually seeing higher premiums. I am just curious what maybe the timing of your sales were, early in the quarter versus late in the quarter, that might have caused the premiums to come in some. Also, the HFS loan balances at period end were also lower. Is that indicative of maybe lower volumes going forward?

Jae Whan Yoo

Okay. Let me start with the SBA gain on sale. Yes, correct. We saw pretty much same amount of the actual premium or gain on sale decrease as I mentioned earlier at the prepared remarks, the premium was 11.5% previous quarter and it came down to 10.3%. Let me explain a little bit in two different buckets there is -- we see it different premium depends on the real estate versus commercial. For example, real estate which is like 25 years of a loan term, it depends on the actual loan yield or the interest rate. Wilshire’s currently SBA real estate loans are priced at typically prime plus 1% or 1.5% and that we do see the premium from the market between 9% to 11.5%.

And secondly, the commercial which is about 10 year of the loan term, Wilshire’s average interest rate is prime plus 2%. With that prime plus 2%, the premium we see is about 10.75%. So, with those two real estate and commercial, we do see slightly decrease from 11.5% that we have experienced last quarter.

However, I don't think we would expect to go below 10% or any radical changes on the premium. And in fact our SBA loan yield has slightly decreased that triggered a reduction on the premium percentage as well as a premium of dollar amount. So, again going forward on a blended, Q3 I would expect about 10% of a premium that expected going forward.

And second question relates to loan held-for-sale reduction. So, reduction was mainly due to warehousing lending. We have in previous quarter in Q1, $134 million and it decreased to $61 million and most of them is again warehousing lending. We have also sold some loans and also there is some reclassification of loan held-for-sale for warehousing. We put it as a loan held-for-sale in the previous quarter and starting second quarter, we re-classed down to C&I loan. So, that’s another reason why you’ll see the C&I loan increased from $204 million to $236 million in the second quarter.

Aaron Deer - Sandler O'Neill & Partners

Okay. That's very helpful. What is your kind of outlook for that mortgage warehouse business? Is that -- are you seeing a pretty sharp decline in that given the up tick in rates here?

Peter Koh

Yes. So, in the second quarter, we did experience some increase in rates. It was expected. We were anticipating it but the pace of the increase was a lot faster than, a lot of the market anticipated. And so, we did see a reduction in the refinanced activities. I think not just in our bank but also all of the warehouse lending activities throughout the industry, but some are depressed because of that fact. However, I think going forward, we will see two things and first is, we will see additional clientele coming through our bank. We are confident that we have a pretty good pipeline right now. So, we will offset some of the reduction with new borrowers. And then also the refinancing activity will solely be transitioning into more purchase activity, which is what we are starting to experience right now. Some of the buyers that were on the sidelines are now coming into the picture because of their interest rate the increasing environment starting. I think we’ll see some transitioning in going forward in the next quarters but we still, even though the balance maybe volatile at that quarter end, we do anticipate that we will be able to stabilize and increase this business.

Aaron Deer - Sandler O'Neill & Partners

Good. That's very encouraging. If I can just squeeze one more question in. I apologize. The - I was surprised to see the FDIC indemnification asset balance go up here in the second quarter, if I saw that correctly. Is that still on track to be zeroed out by the end of the loss share period without having any more write-downs against that.

Alex Ko

Yeah. No, we did not have any impairment charge-off of this FDIC indemnification asset. Actually, the balance as we mentioned it slightly increased from previous quarter of $4.9 million to now it’s a $5.3 million and though increase was actually what we have experienced and it is a more timing issue, what I mean by that is there was a loan that we actually charged off but it was not previously included in FDIC indemnification as a receivable but it was outside of the loans that we initially identified to be charged off and 80% to be received.

However, there was a certain loans there was in excess of that 80% kind of a year marked receivable. So that’s we charged off 80% of that loan balance was added on as a receivables on FDIC indemnification asset. So we would expect to receive that payment in the third quarter and then the temporary increase will come down. And going forward if there is any anticipation for further write-down of the FDIC indemnification asset we do not expect to have any further write-down of the indemnification asset given we still have like four more quarters to go and the charge-off that we have experienced is in line with what we have anticipated.

Aaron Deer - Sandler O'Neill & Partners

Okay, that’s great. Thanks again for taking my questions.

Alex Ko

Thank you, Aaron.

Operator

Your next question comes from the line of John Deysher from Pinnacle. Please proceed.

John Deysher - Pinnacle

Hi, good afternoon. I just have a question on the exposure of the Bank to higher interest rates. And I guess specifically I’d be curious as to what percentage of the loans are variable rate at this point, and also how sensitive the balance sheet is to higher interest rates. Thank you.

Alex Ko

Okay. Let me start with our overall asset liability kind of our management. The bank has been and they continue to be in the second quarter, we are on an asset-sensitive period position. Meaning as the interest rate increases, we will expect the banks net interest income to increase. And I just give you kind of a magnitude or how sensitive we are, in case of a 100 basis point interest rate increases, we would expect our net interest income would increase by 2.1% and let’s say maximum, we performed in a maximum interest raising environment of 400 basis point.

In that case, which is a very unlikely but in that case we would expect our net income will increase by almost 12%. So we would – we believe our earning assets, our position for the interest rate current interest rate environment which is expected to be going up. And the further details of the loan breakdown of the fixed and the variable, Peter will add on.

Peter Koh

So the actual, the numbers we have as of the second quarter end 55.7% of the portfolio is at variable that’s $1.2 million dollars and the – sorry $1.2 billion, fixed rates is 44.3% and that’s $957 million.

John Deysher - Pinnacle

Okay. Thanks. That’s helpful. As the mix of variable and fix changed from last quarter?

Peter Koh

No, we haven’t seen anything significant.

John Deysher - Pinnacle

So, it’s about the same?

Peter Koh

Right.

John Deysher - Pinnacle

That’s it. Thank you.

Peter Koh

Thank you.

Operator

Ladies and gentlemen, this will conclude today’s question-and-answer session of today’s conference. I would now like to turn the call back over to Edward Han for closing remarks,

Edward Han

Thank you. That concludes our quarterly conference call. On behalf of our management team and the Board of Directors, I would like to thank everyone again for your participation and continued interest and support in Wilshire Bancorp. If you have any further questions please feel free to contact us directly. Thank you.

Operator

Ladies and gentlemen that concludes today's conference. Thank you for your participation. And you may now disconnect. Have a great day.

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