OP Bancorp OPBK Q2 2026 earnings

(1)Annualized.

(2)Represents noninterest expense divided by the sum of net interest income and noninterest income.

(3)Includes loans held-for-sale.

Sang K. Oh, President and Chief Executive Officer:

“We delivered another quarter of strong financial performance, highlighted by net income of $8.0 million and diluted EPS of $0.53. Our results were driven by continued revenue growth, a reversal of provision for credit losses reflecting the strength of our credit portfolio, and ongoing improvements in operating efficiency. We also maintained solid balance sheet growth, with increases in both loans and deposits, while preserving strong asset quality and capital levels. As we enter the second half of 2026, we remain committed to driving sustainable growth while maintaining disciplined risk management and operating efficiency,” said Sang K. Oh, President and Chief Executive Officer.

INCOME STATEMENT HIGHLIGHTS

(1)Annualized.

(1)Annualized.

(2)Includes discount accretion from Small Business Administration ("SBA") loan payoffs of $232 thousand, $370 thousand and $293 thousand for the three months ended June 30, 2026, March 31, 2026 and June 30, 2025, respectively.

(3)Includes prepayment penalty income of $91 thousand, $98 thousand and $166 thousand for the three months ended June 30, 2026, March 31, 2026 and June 30, 2025, respectively, primarily from Commercial Real Estate (“CRE”) and SBA loans.

Second Quarter 2026 vs. First Quarter 2026 Net interest income declined by $455 thousand, or 2%, primarily reflecting a one-time interest accrual adjustment related to the Federal Reserve Bank account and the absence of a special FHLB dividend recognized in the prior period. These decreases were partially offset by continued loan growth. As a result, the net interest margin contracted by 11 basis points to 3.08%.

• Interest-bearing deposits in other banks: Interest income decreased by $910 thousand, primarily due to a one-time $739 thousand accrual adjustment on the Federal Reserve Bank account.
• Other investments: Interest income decreased by $349 thousand, mainly due to the absence of a special dividend received on FHLB stock in the prior period.
• Loans: Interest income increased by $852 thousand, driven largely by a $26.5 million increase in average loan balances, reflecting growth in SBA and CRE loans, as well as two additional accrual days during the current period.
• Deposits: Interest expense remained relatively stable compared to the prior period.

Second Quarter 2026 vs. Second Quarter 2025 Net interest income increased by $347 thousand, or 2%, primarily driven by balance-sheet growth and lower deposit rates. These favorable factors were partially offset by lower loan yields, reduced interest income on interest-bearing deposits in other banks resulting from the aforementioned Federal Reserve Bank interest accrual adjustment and lower interest rates, and higher interest expense associated with the subordinated note issued in November 2025. As a result, the net interest margin declined by 15 basis points to 3.08%.

• Loans: Interest income increased by $1.5 million, largely attributable to a $158.1 million increase in average loan balances, reflecting growth in CRE loans. The increase was partially offset by a 20-basis-point decline in loan yields, reflecting the downward repricing of adjustable-rate loans and lower rates on new originations following last year’s federal funds rate cuts, as well as the absence of elevated interest income recognized from nonaccrual loans in the prior period.
• Deposits: Interest expense decreased by $584 thousand, mainly due to a 41-basis-point decline in costs of interest-bearing deposits, driven by the repricing of time deposits following the federal funds rate cuts. This decrease was partially offset by a $121.6 million increase in average interest-bearing deposit balances, reflecting growth in time deposits.
• Interest-bearing deposits in other banks: Interest income decreased by $1.2 million, primarily due to the aforementioned accrual adjustment on the Federal Reserve Bank account, as well as lower yields on Federal Reserve Bank balances.
• Subordinated note: Interest expense increased by $490 thousand, mainly due to the subordinated note issued in November 2025.

Provision for Credit Losses

Second Quarter 2026 vs. First Quarter 2026 Provision for credit losses on loans decreased by $531 thousand, primarily due to the payoff of a previously reserved nonaccrual CRE loan, resulting in the reversal of a $761 thousand specific reserve recorded in the first quarter of 2026.

Second Quarter 2026 vs. Second Quarter 2025 Provision for credit losses on loans decreased by $1.4 million, primarily due to the aforementioned payoff of the nonaccrual CRE loans, as well as lower qualitative reserves driven by slower home mortgage loan growth and a more favorable economic outlook compared to a year ago.

Noninterest Income

Second Quarter 2026 vs. First Quarter 2026 Noninterest income increased by $1.6 million, or 40%, primarily driven by higher gains on sale of loans and loan servicing fees.

• Gains on Sale of Loans: Increased by $1.3 million, driven by stronger SBA loan sale activity. The Bank sold $49.1 million in SBA loans at an average premium rate of 8.17%, compared with $32.2 million sold at an average premium rate of 8.27% in the prior period.
• Loan servicing fees, net of amortization: Increased by $252 thousand, mainly due to lower amortization of servicing assets resulting from reduced payoff activity.

Second Quarter 2026 vs. Second Quarter 2025 Noninterest income increased by $1.7 million, or 42%, primarily due to higher gains on sale of loans, partially offset by lower service charges on deposits.

• Gains on Sale of Loans: Increased by $1.9 million, driven by stronger SBA loan sale activity and higher premium rates. The Bank sold $49.1 million in SBA loans at an average premium rate of 8.17%, compared with $25.3 million sold at an average premium rate of 7.05% in the prior period.
• Service Charges on Deposits: Decreased by $502 thousand, largely reflecting lower balances in existing business analysis accounts and closure of certain currency exchange-related accounts during the third quarter of 2025.

Noninterest Expense

Second Quarter 2026 vs. First Quarter 2026 Noninterest expense increased by $593 thousand, or 4%, primarily due to higher salaries and employee benefits.

• Salaries and Employee Benefits: Increased by $457 thousand, primarily due to annual salary adjustments effective April 2026 and higher incentive accruals driven by increased loan production, partially offset by lower vacation accruals.

Second Quarter 2026 vs. Second Quarter 2025 Noninterest expense increased by $789 thousand, or 6%, primarily due to higher salaries and employee benefits, and increased occupancy and equipment, partially offset by lower other expenses.

• Salaries and Employee Benefits: Increased by $658 thousand, mainly driven by staffing growth and annual salary adjustments effective April 2026.
• Occupancy and equipment: Increased by $317 thousand, primarily due to the expiration of a common-area-maintenance concession on a lease that benefited the prior period.
• Other expenses: Decreased by $190 thousand, primarily due to lower customer service expense following the previously discussed currency exchange account closures.

Income Tax Expense

Second Quarter 2026 vs. First Quarter 2026 Income tax expense increased by $388 thousand to $3.1 million, primarily due to higher pre-tax income, while the effective tax rate increased modestly to 27.8% from 27.0%.

Second Quarter 2026 vs. Second Quarter 2025 Income tax expense increased by $951 thousand to $3.1 million, primarily due to higher pre-tax income. The effective tax rate increased to 27.8% from 25.0%, mainly reflecting the absence of a one-time deferred tax asset revaluation recognized in the prior-year period and the impact of federal tax law changes effective in 2026.

BALANCE SHEET HIGHLIGHTS

Loans

The following table presents loan originations and the corresponding weighted average contractual rates for the periods indicated:

(1)Excludes changes in line utilization.

The following table summarizes the loan activity for the periods indicated:

The following table presents the composition of gross loans by interest rate type accompanied by the weighted average contractual rates as of the periods indicated:

The following table presents the maturity of gross loans by interest rate type accompanied by the weighted average contractual rates for the periods indicated:

Allowance for Credit Losses

The following table summarizes the activity in the allowance for credit losses for the periods presented:

Asset Quality

(1)Excludes the guaranteed portion of loans totaling $947 thousand as of March 31, 2026. There was no guaranteed portion as of June 30, 2026 and 2025.

(2)Excludes loans held-for-sale.

(3)Excludes the guaranteed portion of loans totaling $30.5 million, $30.8 million and $13.9 million as of June 30, 2026, March 31, 2026 and June 30, 2025, respectively.

(4)Excludes the guaranteed portion of loans totaling $35.8 million, $35.9 million and $17.1 million as of June 30, 2026, March 31, 2026 and June 30, 2025, respectively.

(5)Consists of special mention, substandard, doubtful and loss categories.

(6)Consists of substandard, doubtful and loss categories.

(7)Annualized.

Overall credit quality remained stable during the quarter. The allowance for credit losses on loans remained adequate at 1.24% of gross loans.

• Accruing loans 30-89 days past-due increased by $1.2 million, primarily driven by $4.3 million inflows into this category, mainly home mortgage loans, partially offset by $2.2 million migrating to nonaccrual loans, largely SBA loans.
• Nonperforming loans decreased by $1.0 million, primarily driven by the payoff of a $4.1 million CRE loan, partially offset by $3.3 million of loans migrating into nonaccrual status.
• Criticized loans increased modestly by $193 thousand, primarily due to $7.0 million of loan downgrades, mostly offset by $4.5 million in payoffs, including the aforementioned $4.1 million CRE loan, $1.5 million of upgrades, and $837 thousand of principal payments.

Deposits

As of June 30, 2026 vs. March 31, 2026 Total deposits increased by $41.0 million or 2%, primarily driven by a $27.7 million increase in money market deposits and others deposits. The growth was primarily attributable to higher balances from existing customers, as well as the addition of new retail accounts.

As of June 30, 2026 vs. June 30, 2025 Total deposits increased by $113.6 million or 5%, primarily driven by a $131.7 million increase in time deposits. The growth in time deposits was mainly due to new customers opening retail CD accounts, reflecting continued demand for higher-yielding products, together with higher balances from existing wholesale CD accounts.

The following table sets forth the maturity of time deposits as of June 30, 2026:

CAPITAL

On July 23, 2026, the Company’s Board of Directors declared a quarterly cash dividend of $0.14 per share. The dividend is payable on or about August 20, 2026, to shareholders of record as of the close of business on August 6, 2026. The principal source of funds from which the Company pays dividends are the dividends received from the Bank. During the second quarter of 2026, no shares were repurchased under the repurchase program approved in August 2025.

(1)Regulatory capital requirements apply only to Open Bank, and OP Bancorp’s ratios are presented solely for information purposes.

(2)An additional 2.5% capital conservation buffer above the minimum capital ratios are required in order to avoid limitations on distributions, including dividend payments and certain discretionary bonuses to executive officers. This buffer does not apply and is not included in the tier 1 leverage ratio.

(1)Regulatory capital requirements apply only to Open Bank, and OP Bancorp’s ratios are presented solely for information purposes.

ABOUT OP BANCORP

OP Bancorp, the holding company for Open Bank (the “Bank”), is a California corporation whose common stock is quoted on the Nasdaq Global Market under the ticker symbol, “OPBK.” The Bank operates general commercial banking business in Los Angeles, Orange, and Santa Clara Counties in California, the Dallas metropolitan area in Texas, and Clark County in Nevada, serving small- and medium-sized businesses, professionals, and local residents with a particular focus on Korean and other Asian communities. The Bank currently operates twelve full-service branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Cerritos, Gardena, Buena Park, Garden Grove and Santa Clara, California, Carrollton, Texas and Las Vegas, Nevada. The Bank also has one loan production office in Bellevue, Washington. The Bank commenced its operations on June 10, 2005 as First Standard Bank and changed its name to Open Bank in October 2010. Its headquarters is located at 1000 Wilshire Blvd., Suite 500, Los Angeles, California 90017. Phone 213.892.9999; www.myopenbank.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain matters set forth herein constitute “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6 promulgated thereunder. All statements that are not statements of historical fact are forward-looking, and readers should not construe these statements of assurances of expected or intended results, or of promises that management will take a given course of action or pursue the currently expected strategies and objectives. Forward-looking statements in this report include comments about the Company’s current business plans and expectations regarding future operating results, as well as management’s statements about expected future events and economic developments, plans, strategies and objectives. All such statements reflect the current intentions, beliefs and expectations of the Company’s executive management based on currently available information and current and expected market conditions. Forward-looking statements can sometimes be identified by the use of forward-looking language, such as “likely result in,” “expects,” “anticipates,” “estimates,” “forecasts,” “projects,” “intends to,” or may include other similar words or phrases, such as “believes,” “plans,” “trend,” “objective,” “continues,” “remains,” or similar expressions, or future or conditional verbs, such as “will,” “would,” “should,” “could,” “may,” “might,” “can,” or similar verbs. Readers should not construe these statements as assurances of a given level of performance, or as promises that we will take the actions our management currently expects.

Our forward-looking statements are subject to risks and uncertainties that could cause actual results, performance or achievements to differ materially from those projected or could cause us to change plans or strategies or otherwise to take actions that differ from those we currently expect. The known risks and uncertainties that may have these effects are described in Part II, Item 1A, of our Quarterly Report on Form 10-Q for the period ended March 31, 2026, and in our other filings with the Securities and Exchange Commission. You should read all forward-looking statements in the context of the foregoing and should not consider them to be reliable predictions of future events or as assurances of a particular level of performance or intended course of action. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Contact

Investor Relations

OP Bancorp

Jaehyun Park

EVP & CFO

213.593.4865

jaehyun.park@myopenbank.com

NM — Not Meaningful

NM — Not Meaningful

(1)Annualized.

(2)Represents noninterest expense divided by the sum of net interest income and noninterest income.

NM — Not Meaningful

(1)Annualized.

(2)Represents noninterest expense divided by the sum of net interest income and noninterest income.

(1)Excludes the guaranteed portion of loans totaling $947 thousand as of March 31, 2026. There was no guaranteed portion as of June 30, 2026 and 2025.

(2)Excludes the guaranteed portion of loans that were in liquidation totaling $30.5 million, $30.8 million and $13.9 million as of June 30, 2026, March 31, 2026 and June 30, 2025, respectively.

(3)Excludes the guaranteed portion of loans that were in liquidation totaling $35.8 million, $35.9 million and $17.1 million as of June 30, 2026, March 31, 2026 and June 30, 2025, respectively.

(1)Annualized.

(2)Interest income includes a one-time $739 thousand adjustment recorded during the second quarter of 2026 related to the correction of prior-period interest accruals on the Federal Reserve Bank account.

(3)Includes loans held-for-sale.