Saehan Bancorp Reports Third Quarter Results

http://www.businesswire.com/news/home/20091112005998/en

LOS ANGELES--(Business Wire)--
Saehan Bancorp (OTCBB:SAEB) today announced financial results for its third
quarter ended September 30, 2009, reflecting the continued impact of current
economic conditions.

The company reported a net loss of $7.5 million, or $0.47 per share, for the
third quarter of 2009 compared with net loss of $765,000, or $0.06 per diluted
share, for the third quarter of 2008 - representing a significant improvement
compared with the $22.3 million net loss, or $1.39 per share, reported in the
preceding second quarter. The return on average equity for the third quarter of
2009 was -72.74 percent and the return on average assets was -3.26 percent
compared with -4.95 percent and -0.36 percent, respectively, for the third
quarter of 2008.

Additional highlights for the third quarter of 2009 include:

* Total assets at September 30, 2009 decreased 6.6 percent to $830.1 million
from $888.3 million a year ago.
* Net loans decreased 23.6 percent to $566.9 million at September 30, 2009 from
$741.8 million last year.
* Total deposits at September 30, 2009 increased 3.6 percent to $711.9 million
from $687.3 million at September 30, 2008.
* Net interest margin for the third quarter of 2009 increased to 1.57 percent
from the 1.40 percent reported in the second quarter of 2009.
* Efficiency for the third quarter of 2009 was 105.0 percent compared with 194.0
percent in the second quarter of 2009.
* Nonaccrual loans at September 30, 2009 decreased to $55.9 million from $58.4
million at June 30, 2009.
* Allowance for loan losses increased to 7.08 percent of total loans at
September 30, 2009 compared to 6.43 percent at June 30, 2009.

"Financial results for the third quarter of 2009 are reflective of the
challenging economic conditions facing the banking industry. We continue to
remain focused on restoring the bank`s capital position to an acceptable level,
building adequate reserves for loan losses, and maintaining ample liquidity,"
said Chung Hoon Youk, president and chief executive officer of Saehan Bancorp.

Net interest income before provision for loan losses was $3.5 million in the
third quarter of 2009 compared with $7.5 million in the third quarter of 2008,
and $3.3 million in the second quarter of 2009. For the third quarter of 2009,
net interest margin was 1.57 percent compared with 1.40 percent in the second
quarter of 2009. The increase in the net interest margin from the previous
quarter was primarily a result of a decrease in high-cost deposits, re-pricing
of certificates of deposits, a decrease in brokered deposits and a decrease in
non-accrual loans.

Noninterest income in the third quarter of 2009 totaled $2.3 million compared
with $1.3 million in the third quarter of 2008 and $126,000 in the second
quarter of 2009. The increase in noninterest income is primarily attributable to
a $1.0 million gain from the sale of the bank owned property in the third
quarter of 2009.

Noninterest expense for the third quarter of 2009 was $6.2 million, an increase
of $472,000 from the third quarter of 2008 and a decrease of $398,000 from the
second quarter of 2009. The slight decrease in noninterest expense for the third
quarter of 2009 compared with that of the second quarter of 2009 is primarily
attributable to lower employee salaries and benefits, partially offset by the
increases in FDIC assessment and legal fees.

The efficiency ratio for the third quarter of 2009 was 106.0 percent compared
with 194.0 percent in the second quarter of 2009.

Nonperforming assets were $68.2 million at September 30, 2009, compared with
$66.9 million at June 30, 2009. Nonperforming assets represented 8.2 percent of
total assets at September 30, 2009. The provision for loan losses was $12.4
million for the third quarter of 2009 compared with $34.9 million for the second
quarter of 2009.

Shareholders` equity totaled $33.4 million at September 30, 2009 -- a decrease
of $7.3 million compared with $40.7 million at June 30, 2009. Shareholders`
equity primarily decreased as a result of the net loss. The Leverage Ratio was
2.6 percent, the Tier 1 Risk-based Capital Ratio was 3.5 percent and the Total
Risk-based Capital Ratio was 4.8 percent at September 30, 2009.

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 "believe," "expect,"
"anticipate," "intend," "plan," "estimate," or words of similar meaning, or
future or conditional verbs such as "will," "would," "should," "could," or
"may."

Saehan Bancorp
Condensed Balance Sheet
(Dollars in thousands)

30-Sep
2009 2008
Assets:
Cash & due from banks - demand 13,915 20,880
Due from banks - interest bearing 108,047 1,022
Federal fund sold 5,082 48,410
Securities available-for-sale 75,617 45,030
Loans 610,051 752,677
Less: Allowance for loan losses 43,166 10,890
Net loans 566,885 741,786
Loans held for sale 999 645
Bank premises and equipment, net 4,638 6,395
OREO and other investment in real estate 12,360 -
Other assets 42,504 21,987
Total assets 830,050 888,287

Liabilities and stockholders' equity:
Deposits:
Noninterest bearing demand 130,842 138,065
Interest bearing demand and savings 125,415 157,613
Time deposits 455,684 391,635
Total deposits 711,941 687,313
Other liabilities 84,684 140,844
Total liabilities 796,625 828,157
Total stockholders' equity 33,425 60,130
Total liabilities and stockholders' equity 830,050 888,287
Book value per share 2.08 4.99
Period end shares outstanding 16,032,429 12,053,454
Nonperforming loans 55,917 27,355

Tier I leverage 2.56 % 9.30 %
Tier I risk-based capital 3.49 % 9.80 %
Total risk-based capital 4.81 % 11.06 %

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

For the three For the nine
months ended months ended
30-Sep 30-Sep
2009 2008 2009 2008
Interest income:
Interest and fees on loans 8,552 12,881 27,240 39,096
Interest on securities 365 472 1,201 1,474
Interest on federal funds sold 36 80 54 218
Other interest income 197 94 355 280
Total interest income 9,150 13,527 28,850 41,067
Interest expense:
Deposit 4,635 4,867 13,971 15,793
Other 993 1,196 3,178 3,694
Total interest expenses 5,628 6,063 17,149 19,487
Net interest income before provision for loan losses 3,522 7,464 11,701 21,580
Provision for loan losses 12,380 4,352 47,506 10,340
Noninterest income:
Service charges on deposit accounts 570 635 1,871 1,912
Gain on sale of loans 173 241 272 706
Gain on sale of investment securities 14 - 24 -
Gain (loss) on sales of OREO 24 - (1,956 ) -
Other operating income 1,537 392 2,657 1,776
Total noninterest income 2,318 1,268 2,868 4,394
Noninterest expense:
Salaries and employee benefits 2,236 2,854 7,186 9,274
Net occupancy and equipment expense 1,282 1,238 3,789 3,676
Other operating expense 2,674 1,628 7,042 5,133
Total noninterest expenses 6,192 5,720 18,017 18,083
Income before income taxes (12,732 ) (1,340 ) (50,954 ) (2,450 )
Income taxes (5,256 ) (575 ) (21,130 ) (1,000 )
Income before extraordinary items (7,476 ) (765 ) (29,824 ) (1,450 )
Extraordinary items, net of taxes
Net income (7,476 ) (765 ) (29,824 ) (1,450 )
Net income per share -
Basic $ (0.47 ) $ (0.06 ) $ (1.86 ) $ (0.12 )
Diluted $ (0.47 ) $ (0.06 ) $ (1.86 ) $ (0.12 )

Basic average common shares outstanding 16,032,429 12,053,454 16,032,429 12,053,548
Diluted average common shares outstanding 16,035,637 12,059,123 16,035,433 12,064,172

Charge offs 12,154 4,511 27,828 7,752
Recoveries 218 3 1,331 53

For the three For the nine
months ended months ended
30-Sep 30-Sep
2009 2008 2009 2008
Key Operating Ratios:
Return on average assets -3.26 % -0.36 % -4.43 % -0.23 %
Return on average equity -72.74 % -4.95 % -70.06 % -3.10 %
Yield on earning assets 4.09 % 7.06 % 4.41 % 6.82 %
Cost on interest bearing liabilities 2.68 % 3.68 % 3.21 % 4.07 %
Net interest margin 1.57 % 3.89 % 1.79 % 3.58 %
Cost of funds 2.31 % 3.06 % 1.87 % 3.75 %
Efficiency ratio 106.03 % 65.51 % 123.67 % 69.62 %
Average stockholders' equity to average total assets 4.48 % 7.18 % 6.33 % 7.46 %

Saehan Bancorp
Daniel Kim
Senior Vice President & Chief Financial Officer
(213) 637-4802
or
Maier & Company, Inc.
Gary S. Maier
(310) 442-9852

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