U & I Financial Corp. Reports Second Quarter 2020 Financial Results

Continues Growth with PPP Loans

U & I Financial Corp. UNIF, the holding company for UniBank, today reported second quarter net income of $1.5 million or $0.26 per share, as compared to $1.4 million or $0.26 per share for the same quarter of 2019, despite $300 thousand in higher Provision for Loan and Lease Losses expense. For the year, net income exceeded $2.8 million or $0.51 per share, increasing by $150 thousand or $0.02 per share from the same period last year, despite $550 thousand in higher Provision for Loan and Lease Losses expense.

As of June 30, 2020, total assets ended at $380.4 million, increasing by $57.2 million or 17.7% from the year earlier period of $323.2 million. Net loans reached $281.5 million, increasing by $63.9 million or 29.4% from the year earlier period of $217.6 million. During this quarter, the Bank funded 391 PPP loans, totaling $41.4 million. Finally, total deposits grew by $48.8 million or 18.5% to $313.4 million from the year earlier period of $264.6 million.

"We had another solid quarter, despite the continuing operational and financial challenges caused by the COVID-19 pandemic," said Peter Park, President and CEO. He added that, "Fortunately, due to our swift pandemic responses taken early on, we were able to operate safely with minimal disruptions. On the financial side, I am very proud of our staff for their accomplishments in generating the PPP loans, which helped drive much of the growth this quarter. Although our nonperforming assets ratio remained relatively unchanged, we significantly increased our provision for loan losses for the second quarter in a row, due to the continued economic uncertainties. All in all, despite further challenges looming ahead, due to the dedication of our capable staff and astute guidance from our board, we believe that we have built a strong foundation to continuously deliver favorable returns to our shareholders."

2020 Second Quarter Financial Highlights

Total assets grew 17.7% to $380.4 million as compared to $323.2 million a year ago.

Net loans grew 29.4% to $281.5 million as compared to $217.6 million a year ago.

Total deposits grew 18.5% to $313.4 million as compared to $264.6 million a year ago.

Net income year-to-date grew 5.6% to $2.8 million as compared to $2.7 million one year ago.

Net interest margin for the year was 4.26% as compared to 4.15% one year ago.

Gain on sale of SBA/USDA loans for the year was $1.0 million as compared to $1.3 million a year ago.

Return on average equity for the year was 10.95% as compared to 12.06% a year ago.

Return on average assets for the year was 1.59% as compared to 1.75% a year ago.

The Allowance for Loan Losses to Loans, excluding PPP loans, was 1.43% as compared to 1.14% a year ago.

Nonperforming assets to total assets was 0.22% as compared to 0.14% a year ago.

Efficiency ratio (noninterest expense divided by revenue) for the year was 54.60% as compared to 56.83% a year ago.

About U & I Financial Corp.

UniBank, the wholly-owned subsidiary of U & I Financial Corp. UNIF, is one of the highest performing banks in Washington state in terms of return on assets. Based in Lynnwood, Washington, the bank was founded in 2006 to serve the small to medium-sized businesses, professionals, and residents with a particular emphasis on Korean and other ethnic minority communities. Customers can access their accounts in any of the 4 branches – Lynnwood, Bellevue, Federal Way and Tacoma – online, or through the Bank's ATM network.

For more information visit www.unibankusa.com or call (425) 275-9700.

Forward-Looking Statement Safe Harbor: This news release contains comments or information that constitutes forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that are based on current expectations that involve a number of risks and uncertainties. Forward-looking statements describe U & I Financial Corp.'s projections, estimates, plans and expectations of future results and can be identified by words such as "believe," "intend," "estimate," "likely," "anticipate," "expect," "looking forward," and other similar expressions. They are not guarantees of future performance. Actual results may differ materially from the results expressed in these forward-looking statements, which because of their forward-looking nature, are difficult to predict. Investors should not place undue reliance on any forward-looking statement, and should consider factors that might cause differences including but not limited to the degree of competition by traditional and nontraditional competitors, declines in real estate markets, an increase in unemployment or sustained high levels of unemployment; changes in interest rates; adverse changes in local, national and international economies; changes in the Federal Reserve's actions that affect monetary and fiscal policies; changes in legislative or regulatory actions or reform, including without limitation, the Dodd-Frank Wall Street Reform and Consumer Protection Act; demand for products and services; changes to the quality of the loan portfolio and our ability to succeed in our problem-asset resolution efforts; the impact of technological advances; changes in tax laws; and other risk factors. U & I Financial Corp. undertakes no obligation to publicly update or clarify any forward-looking statement to reflect the impact of events or circumstances that may arise after the date of this release.

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