LOS ANGELES, Oct. 21, 2014 /PRNewswire/ -- Cathay General
Bancorp (the "Company", NASDAQ: CATY), the holding company for
Cathay Bank, today announced net income of $35.9 million, or $0.45 per share, for the third quarter of
2014.
FINANCIAL PERFORMANCE
|
Three months ended
September 30,
|
|
2014
|
|
2013
|
Net income
|
$35.9
million
|
|
$32.5
million
|
Net income available
to common stockholders
|
$35.9
million
|
|
$30.0
million
|
Basic earnings per
common share
|
$0.45
|
|
$0.38
|
Diluted earnings per
common share
|
$0.45
|
|
$0.38
|
Return on average
assets
|
1.27%
|
|
1.22%
|
Return on average
total stockholders' equity
|
9.14%
|
|
8.37%
|
Efficiency
ratio
|
44.51%
|
|
51.01%
|
THIRD QUARTER HIGHLIGHTS
- Diluted earnings per share increased 18.4% to $0.45 per share for the third quarter of 2014
compared to $0.38 per share for the
same quarter a year ago.
- Total loans increased $293.0
million, or 13.6% annualized, in the third quarter of 2014,
to $8.9 billion at September 30, 2014, compared to $8.6 billion at June 30,
2014, and $8.1 billion at
December 31, 2013.
"Our loan growth for the third quarter continued to be strong,
increasing $293 million, or a 13.6%,
annualized rate. For the first nine months, our loans increased by
an annualized rate of 12.8%," commented Dunson Cheng, Chairman of the Board, Chief
Executive Officer, and President of the Company.
"We are also pleased that our core deposits increased
$255 million, or 20.9% annualized in
the third quarter as we continue to focus on growing our core
deposits. In the first nine months our deposits increased by 11.9%
on an annualized basis. Our total operating expenses in the third
quarter were essentially flat compared to the second quarter
as we begin to fully realize the operating efficiencies provided by
our new core system," concluded Dunson
Cheng.
THIRD QUARTER INCOME STATEMENT REVIEW
Net income available to common stockholders for the quarter
ended September 30, 2014, was
$35.9 million, an increase of
$5.9 million, or 19.5%, compared to
net income available to common stockholders of $30.0 million for the same quarter a year
ago. Diluted earnings per share available to common
stockholders for the quarter ended September
30, 2014, was $0.45 compared
to $0.38 for the same quarter a year
ago due primarily to an increase in net interest income, a higher
negative provision for credit losses in 2014, a decrease in the
cost associated with debt redemption and the elimination of
preferred stock dividends, which were partially offset by a
decrease in securities gains.
Return on average stockholders' equity was 9.14% and return on
average assets was 1.27% for the quarter ended September 30, 2014, compared to a return on
average stockholders' equity of 8.37% and a return on average
assets of 1.22% for the same quarter a year ago.
Net interest income before provision for credit
losses
Net interest income before provision for credit losses increased
$4.2 million, or 5.0%, to
$86.8 million during the third
quarter of 2014 compared to $82.6
million during the same quarter a year ago. The
increase was due primarily to the increase in loan interest income
and the decrease in interest expense from securities sold under
agreements to repurchase, offset by the decrease in interest income
from available-for-sale securities.
The net interest margin, on a fully taxable-equivalent basis,
was 3.31% for the third quarter of 2014, compared to 3.37% for the
second quarter of 2014 and 3.35% for the third quarter of
2013. The decrease in the net interest margin was due to the
impact of interest rates swaps and higher levels of short term
interest bearing cash deposits.
For the third quarter of 2014, the yield on average
interest-earning assets was 4.06%, the cost of funds on average
interest-bearing liabilities was 0.97%, and the cost of interest
bearing deposits was 0.67%. In comparison, for the third
quarter of 2013, the yield on average interest-earning assets was
4.15%, the cost of funds on average interest-bearing liabilities
was 1.05%, and the cost of interest bearing deposits was 0.64%. The
interest spread, defined as the difference between the yield on
average interest-earning assets and the cost of funds on average
interest-bearing liabilities, decreased to 3.09% for the quarter
ended September 30, 2014, from 3.10%
for the same quarter a year ago.
Provision for credit losses
Provision for credit losses was a credit of $5.1 million for the third quarter of 2014
compared to a credit of $3.0 million
for the third quarter of 2013. The provision for credit
losses was based on the review of the adequacy of the allowance for
loan losses at September 30, 2014.
The provision or reversal for credit losses represents the charge
against or benefit toward current earnings that is determined by
management, through a credit review process, as the amount needed
to establish an allowance that management believes to be sufficient
to absorb credit losses inherent in the Company's loan portfolio,
including unfunded commitments. The following table
summarizes the charge-offs and recoveries for the periods
indicated:
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(In
thousands)
|
Charge-offs:
|
|
|
|
|
|
|
|
Commercial
loans
|
$ 252
|
|
$ 200
|
|
$ 7,592
|
|
$ 4,580
|
Construction
loans
|
-
|
|
-
|
|
1,813
|
|
-
|
Real estate
loans (1)
|
903
|
|
554
|
|
3,327
|
|
2,873
|
Real estate-
land loans
|
-
|
|
-
|
|
-
|
|
1,318
|
Total
charge-offs
|
1,155
|
|
754
|
|
12,732
|
|
8,771
|
Recoveries:
|
|
|
|
|
|
|
|
Commercial
loans
|
4,148
|
|
436
|
|
10,852
|
|
2,015
|
Construction
loans
|
32
|
|
1,236
|
|
57
|
|
2,256
|
Real estate
loans (1)
|
2,194
|
|
1,225
|
|
6,293
|
|
4,229
|
Real estate-
land loans
|
3
|
|
1,447
|
|
11
|
|
2,101
|
Installment
and other loans
|
-
|
|
-
|
|
-
|
|
11
|
Total recoveries
|
6,377
|
|
4,344
|
|
17,213
|
|
10,612
|
Net
recoveries
|
$ (5,222)
|
|
$ (3,590)
|
|
$ (4,481)
|
|
$ (1,841)
|
|
|
(1) Real estate loans
include commercial mortgage loans, residential mortgage loans and
equity lines.
|
|
Non-interest income
Non-interest income, which includes revenues from depository
service fees, letters of credit commissions, securities gains
(losses), gains (losses) on loan sales, wire transfer fees, and
other sources of fee income, was $9.0
million for the third quarter of 2014, a decrease of
$7.7 million, or 46.3%, compared to
$16.7 million for the third quarter
of 2013. The decrease in non-interest income in the third quarter
of 2014 was primarily due to a decrease of $8.3 million in gains on sale of securities
offset by increases of $363,000 in
commissions from wealth management and $225,000 in income from venture capital
investments.
Non-interest expense
Non-interest expense decreased $8.1
million, or 15.9%, to $42.6
million in the third quarter of 2014 compared to
$50.7 million in the same quarter a
year ago. The efficiency ratio was 44.51% in the third
quarter of 2014 compared to 51.01% for the same quarter a year
ago.
Costs associated with debt redemption decreased $6.3 million to $527,000 in the third quarter of 2014 compared to
$6.9 million in the same quarter a
year ago. The Company prepaid $171.2 million of
advances from the Federal Home Loan Bank in the third quarter of
2014 whereas the Company prepaid $150.0
million of securities sold under agreements to repurchase in
the same period a year ago. Amortization of core deposit
premiums decreased $1.1 million to
$214,000 in the third quarter of 2014
compared to $1.4 million in the same
quarter a year ago, as a result of the full amortization of the
core deposit premium from the General Bank acquisition. Other
real estate owned ("OREO") expense decreased $1.5 million to income of $1.0 million in the third quarter of 2014
compared to expense of $527,000 in
the same quarter a year ago, primarily due to increases in gains on
sale of OREO of $787,000 and
decreases in OREO expenses of $517,000. Partially offsetting the
decreases was a $549,000 increase in
FDIC and state assessments.
Income taxes
The effective tax rate for the third quarter of 2014 was 38.3%
compared to 36.9% for the third quarter of 2013. The
effective tax rate includes the impact of the utilization of low
income housing tax credits.
BALANCE SHEET REVIEW
Gross loans were $8.86 billion at
September 30, 2014, an increase of
$773.7 million, or 9.6%, from
$8.08 billion at December 31, 2013, primarily due to increases of
$391.0 million, or 9.7%, in
commercial mortgage loans, $161.5
million, or 11.9%, in residential mortgage loans,
$151.4 million, or 6.6%, in
commercial loans, and $79.8 million,
or 36.0%, in real estate construction loans. The changes in
loan balances and composition from December
31, 2013, are presented below:
|
September 30,
2014
|
|
December 31,
2013
|
|
% Change
|
|
(Dollars in
thousands)
|
|
|
Commercial
loans
|
$ 2,450,118
|
|
$ 2,298,724
|
|
7
|
Residential mortgage
loans
|
1,516,711
|
|
1,355,255
|
|
12
|
Commercial mortgage
loans
|
4,414,067
|
|
4,023,051
|
|
10
|
Equity
lines
|
172,223
|
|
171,277
|
|
1
|
Real estate
construction loans
|
301,459
|
|
221,701
|
|
36
|
Installment &
other loans
|
3,676
|
|
14,555
|
|
(75)
|
|
|
|
|
|
|
Gross
loans
|
$ 8,858,254
|
|
$ 8,084,563
|
|
10
|
|
|
|
|
|
|
Allowance for loan
losses
|
(169,198)
|
|
(173,889)
|
|
(3)
|
Unamortized deferred
loan fees
|
(12,903)
|
|
(13,487)
|
|
(4)
|
|
|
|
|
|
|
Total loans,
net
|
$ 8,676,153
|
|
$ 7,897,187
|
|
10
|
Total deposits were $8.69 billion
at September 30, 2014, an increase of
$713.4 million, or 8.9%, from
$7.98 billion at December 31, 2013, primarily due to a
$228.2 million, or 17.7%, increase in
money market deposits, a $172.4
million, or 18.5%, increase in time deposits under
$100,000, a $151.1 million, or 10.5%, increase in
non-interest bearing demand deposits, a $82.7 million, or 12.1%, increase in NOW
deposits, and a $35.9 million, or
1.1%, increase in time deposits of $100,000 or more. The changes in deposit
balances and composition from December 31,
2013, are presented below:
|
September 30,
2014
|
|
December 31,
2013
|
|
%
Change
|
|
(Dollars in
thousands)
|
|
|
Non-interest-bearing
demand deposits
|
$
1,593,003
|
|
$
1,441,858
|
|
10
|
NOW
deposits
|
766,622
|
|
683,873
|
|
12
|
Money market
deposits
|
1,514,496
|
|
1,286,338
|
|
18
|
Savings
deposits
|
542,454
|
|
499,520
|
|
9
|
Time deposits under
$100,000
|
1,103,634
|
|
931,204
|
|
19
|
Time deposits of
$100,000 or more
|
3,174,460
|
|
3,138,512
|
|
1
|
Total
deposits
|
$
8,694,669
|
|
$
7,981,305
|
|
9
|
|
|
|
|
|
|
ASSET QUALITY REVIEW
At September 30, 2014, total
non-accrual loans were $65.3 million,
a decrease of $34.6 million, or
34.7%, from $99.9 million at
September 30, 2013, and a decrease of
$17.9 million, or 21.5%, from
$83.2 million at December 31, 2013.
The allowance for loan losses was $169.2
million and the allowance for off-balance sheet unfunded
credit commitments was $2.0 million
at September 30, 2014, which
represented the amount believed by management to be sufficient to
absorb credit losses inherent in the loan portfolio, including
unfunded commitments. The allowance for credit losses, which
is the sum of the allowances for loan losses and for off-balance
sheet unfunded credit commitments, was $171.2 million at September 30, 2014, compared to $175.3 million at December
31, 2013, a decrease of $4.1
million, or 2.3%. The allowance for credit losses
represented 1.93% of period-end gross loans and 259.7% of
non-performing loans at September 30,
2014. The comparable ratios were 2.17% of period-end gross
loans and 208.2% of non-performing loans at December 31, 2013. The changes in the
Company's non-performing assets and troubled debt restructurings at
September 30, 2014, compared to
December 31, 2013, and to
September 30, 2013, are highlighted
below:
(Dollars in
thousands)
|
September 30,
2014
|
|
December 31,
2013
|
|
% Change
|
|
September 30,
2013
|
|
% Change
|
Non-performing
assets
|
|
|
|
|
|
|
|
|
|
Accruing loans past
due 90 days or more
|
$
662
|
|
$
982
|
|
(33)
|
|
$
499
|
|
33
|
Non-accrual
loans:
|
|
|
|
|
|
|
|
|
|
Construction-
residential loans
|
-
|
|
3,313
|
|
(100)
|
|
3,495
|
|
(100)
|
Construction-
non-residential loans
|
25,728
|
|
25,273
|
|
2
|
|
25,500
|
|
1
|
Land
loans
|
5,996
|
|
6,502
|
|
(8)
|
|
8,334
|
|
(28)
|
Commercial
real estate loans, excluding land loans
|
17,834
|
|
13,119
|
|
36
|
|
27,662
|
|
(36)
|
Commercial
loans
|
8,851
|
|
21,232
|
|
(58)
|
|
24,506
|
|
(64)
|
Residential
mortgage loans
|
6,849
|
|
13,744
|
|
(50)
|
|
10,364
|
|
(34)
|
Total non-accrual
loans:
|
$
65,258
|
|
$
83,183
|
|
(22)
|
|
$
99,861
|
|
(35)
|
Total non-performing
loans
|
65,920
|
|
84,165
|
|
(22)
|
|
100,360
|
|
(34)
|
Other real
estate owned
|
29,025
|
|
52,985
|
|
(45)
|
|
49,777
|
|
(42)
|
Total non-performing
assets
|
$
94,945
|
|
$
137,150
|
|
(31)
|
|
$
150,137
|
|
(37)
|
Accruing
troubled debt restructurings (TDRs)
|
$ 123,089
|
|
$
117,597
|
|
5
|
|
$
115,940
|
|
6
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses
|
$ 169,198
|
|
$
173,889
|
|
(3)
|
|
$
181,452
|
|
(7)
|
Allowance for
off-balance sheet credit commitments
|
2,018
|
|
1,362
|
|
48
|
|
2,074
|
|
(3)
|
Allowance for credit
losses
|
$
171,216
|
|
$
175,251
|
|
(2)
|
|
$
183,526
|
|
(7)
|
|
|
|
|
|
|
|
|
|
|
Total gross loans
outstanding, at period-end
|
$ 8,858,254
|
|
$ 8,084,563
|
|
10
|
|
$
7,832,013
|
|
13
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses to non-performing loans, at period-end
|
256.67%
|
|
206.60%
|
|
|
|
180.80%
|
|
|
Allowance for credit
losses to non-performing loans, at period-end
|
259.73%
|
|
208.22%
|
|
|
|
182.87%
|
|
|
Allowance for loan
losses to gross loans, at period-end
|
1.91%
|
|
2.15%
|
|
|
|
2.32%
|
|
|
Allowance for credit
losses to gross loans, at period-end
|
1.93%
|
|
2.17%
|
|
|
|
2.34%
|
|
|
Troubled debt restructurings on accrual status totaled
$123.1 million at September 30, 2014, compared to $117.6 million at December
31, 2013. These loans are classified as troubled debt
restructurings as a result of granting a concession to
borrowers. Although these loan modifications are considered
troubled debt restructurings under Accounting Standard Codification
310-40 and Accounting Standard Update 2011-02, these loans have
been performing under the restructured terms and have demonstrated
sustained performance under the modified terms. The sustained
performance considered by management includes the periods prior to
the modification if the prior performance met or exceeded the
modified terms as well as cash paid to set up interest reserves.
The ratio of non-performing assets to total assets was 0.8% at
September 30, 2014, compared to 1.3%
at December 31, 2013. Total
non-performing assets decreased $42.3
million, or 30.8%, to $94.9
million at September 30, 2014,
compared to $137.2 million at
December 31, 2013, primarily due to a
$17.9 million, or 21.5%, decrease in
non-accrual loans and a $24.0
million, or 45.2%, decrease in OREO.
CAPITAL ADEQUACY REVIEW
At September 30, 2014, the
Company's Tier 1 risk-based capital ratio of 14.77%, total
risk-based capital ratio of 16.05%, and Tier 1 leverage capital
ratio of 12.66%, continue to place the Company in the "well
capitalized" category for regulatory purposes, which is defined as
institutions with a Tier 1 risk-based capital ratio equal to or
greater than 6%, a total risk-based capital ratio equal to or
greater than 10%, and a Tier 1 leverage capital ratio equal to or
greater than 5%. At December 31,
2013, the Company's Tier 1 risk-based capital ratio was
15.04%, total risk-based capital ratio was 16.35%, and Tier 1
leverage capital ratio was 12.48%.
YEAR-TO-DATE REVIEW
Net income attributable to common stockholders for the nine
months ended September 30, 2014, was
$102.3 million, an increase of
$20.7 million, or 25.4%, compared to
net income attributable to common stockholders of $81.6 million for the same period a year ago, due
primarily to increases in net interest income, a higher negative
provision for credit losses, decreases in costs associated with
debt redemption, decreases in amortization of core deposit
premiums, decrease in professional services expense, and
decreases in OREO expense partially offset by decreases in gains on
sale of securities, increases in salaries and incentive
compensation expense, and higher FDIC and state assessments.
Diluted earnings per share attributable to common stockholders for
the nine months ended September 30,
2014, was $1.28 compared to
$1.03 for the same period a year
ago. The net interest margin for the nine months ended
September 30, 2014, increased to
3.35% from 3.33% for the same period a year ago.
Return on average stockholders' equity was 8.98% and return on
average assets was 1.25% for the nine months ended September 30, 2014, compared to a return on
average stockholders' equity of 7.78% and a return on average
assets of 1.16% for the same period of 2013. The efficiency
ratio for the nine months ended September
30, 2014, was 46.31% compared to 52.09% for the same period
a year ago.
CONFERENCE CALL
Cathay General Bancorp will host a conference call this
afternoon to discuss its third quarter 2014 financial results. The
call will begin at 3:00 p.m., Pacific
Time. Analysts and investors may dial in and participate in
the question-and-answer session. To access the call, please dial
1-877-703-6103 and enter Participant Passcode 65821172. A
listen-only live Webcast of the call will be available at
www.cathaygeneralbancorp.com and a recorded version is scheduled to
be available for replay for 12 months after the call.
ABOUT CATHAY GENERAL BANCORP
Cathay General Bancorp is the holding company for Cathay Bank, a
California state-chartered bank.
Founded in 1962, Cathay Bank offers a wide range of financial
services. Cathay Bank currently operates 33 branches in
California, nine branches in
New York State, one in
Massachusetts, two in Texas, three in Washington State, three in the Chicago, Illinois area, one in New Jersey, one in Nevada, one in Hong
Kong, and a representative office in Shanghai and in Taipei. Cathay Bank's website is found at
http://www.cathaybank.com. Cathay General Bancorp's website is
found at http://www.cathaygeneralbancorp.com. Information set
forth on such websites is not incorporated into this press
release.
FORWARD-LOOKING STATEMENTS AND OTHER NOTICES
Statements made in this press release, other than statements of
historical fact, are forward-looking statements within the meaning
of the applicable provisions of the Private Securities Litigation
Reform Act of 1995 regarding management's beliefs, projections, and
assumptions concerning future results and events. These
forward-looking statements may include, but are not limited to,
such words as "aims," "anticipates," "believes," "can," "continue,"
"could," "estimates," "expects," "hopes," "intends," "may,"
"plans," "projects," "predicts," "potential," "possible,"
"optimistic," "seeks," "shall," "should," "will," and variations of
these words and similar expressions. Forward-looking statements are
based on estimates, beliefs, projections, and assumptions of
management and are not guarantees of future performance. These
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
from our historical experience and our present expectations or
projections. Such risks and uncertainties and other factors
include, but are not limited to, adverse developments or conditions
related to or arising from U.S. and international business and
economic conditions; possible additional provisions for loan losses
and charge-offs; credit risks of lending activities and
deterioration in asset or credit quality; extensive laws and
regulations and supervision that we are subject to including
potential future supervisory action by bank supervisory
authorities; increased costs of compliance and other risks
associated with changes in regulation including the implementation
of the Dodd-Frank Wall Street Reform and Consumer Protection Act
(the "Dodd-Frank Act"); higher capital requirements from the
implementation of the Basel III capital standards; compliance with
the Bank Secrecy Act and other money laundering statutes and
regulations; potential goodwill impairment; liquidity risk;
fluctuations in interest rates; risks associated with acquisitions
and the expansion of our business into new markets; inflation and
deflation; real estate market conditions and the value of real
estate collateral; environmental liabilities; our ability to
compete with larger competitors; our ability to retain key
personnel; successful management of reputational risk; natural
disasters and geopolitical events; general economic or business
conditions in Asia, and other
regions where Cathay Bank has operations; failures, interruptions,
or security breaches of our information systems; our ability to
adapt our systems to technological changes; risk management
processes and strategies; adverse results in legal proceedings;
certain provisions in our charter and bylaws that may affect
acquisition of the Company; changes in accounting standards or tax
laws and regulations; market disruption and volatility;
restrictions on dividends and other distributions by laws and
regulations and by our regulators and our capital structure;
issuance of preferred stock; successfully raising additional
capital, if needed, and the resulting dilution of interests of
holders of our common stock; and the soundness of other financial
institutions.
These and other factors are further described in Cathay General
Bancorp's Annual Report on Form 10-K for the year ended
December 31, 2013 (Item 1A in
particular), other reports filed with the Securities and Exchange
Commission ("SEC"), and other filings Cathay General Bancorp makes
with the SEC from time to time. Actual results in any future period
may also vary from the past results discussed in this press
release. Given these risks and uncertainties, readers are cautioned
not to place undue reliance on any forward-looking statements,
which speak to the date of this press release. Cathay General
Bancorp has no intention and undertakes no obligation to update any
forward-looking statement or to publicly announce any revision of
any forward-looking statement to reflect future developments or
events, except as required by law.
Cathay General Bancorp's filings with the SEC are available at
the website maintained by the SEC at http://www.sec.gov, or by
request directed to Cathay General Bancorp, 9650 Flair Drive,
El Monte, California 91731,
Attention: Investor Relations, (626) 279-3286.
CATHAY
GENERAL BANCORP
CONSOLIDATED
FINANCIAL HIGHLIGHTS
(Unaudited)
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
(Dollars in
thousands, except per share data)
|
|
2014
|
|
2013
|
|
% Change
|
|
2014
|
|
2013
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
PERFORMANCE
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
before provision for credit
losses
|
|
$
86,755
|
|
$
82,608
|
|
5
|
|
$ 255,030
|
|
$
242,734
|
5
|
Reversal for credit
losses
|
|
(5,100)
|
|
(3,000)
|
|
70
|
|
(8,800)
|
|
(3,000)
|
193
|
Net interest income
after provision for credit losses
|
|
91,855
|
|
85,608
|
|
7
|
|
263,830
|
|
245,734
|
7
|
Non-interest
income
|
|
8,974
|
|
16,720
|
|
(46)
|
|
32,554
|
|
51,962
|
(37)
|
Non-interest
expense
|
|
42,607
|
|
50,670
|
|
(16)
|
|
133,188
|
|
153,514
|
(13)
|
Income before income
tax expense
|
|
58,222
|
|
51,658
|
|
13
|
|
163,196
|
|
144,182
|
13
|
Income tax
expense
|
|
22,313
|
|
19,029
|
|
17
|
|
60,944
|
|
52,489
|
16
|
Net income
|
|
35,909
|
|
32,629
|
|
10
|
|
102,252
|
|
91,693
|
12
|
Net income
attributable to noncontrolling interest
|
|
-
|
|
151
|
|
(100)
|
|
-
|
|
452
|
(100)
|
Net income
attributable to Cathay General Bancorp
|
|
$
35,909
|
|
$
32,478
|
|
11
|
|
$ 102,252
|
|
$
91,241
|
12
|
Dividends on
preferred stock and noncash charge from repayment
|
-
|
|
(2,434)
|
|
(100)
|
|
-
|
|
(9,685)
|
(100)
|
Net income
attributable to common stockholders
|
|
$
35,909
|
|
$
30,044
|
|
20
|
|
$ 102,252
|
|
$
81,556
|
25
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders per common share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.45
|
|
$
0.38
|
|
18
|
|
$
1.28
|
|
$
1.03
|
24
|
Diluted
|
|
$
0.45
|
|
$
0.38
|
|
18
|
|
$
1.28
|
|
$
1.03
|
24
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends
paid per common share
|
|
$
0.07
|
|
$
0.01
|
|
600.00
|
|
$
0.19
|
|
$
0.03
|
533.33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED
RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
1.27%
|
|
1.22%
|
|
4
|
|
1.25%
|
|
1.16%
|
8
|
Return on average
total stockholders' equity
|
|
9.14%
|
|
8.37%
|
|
9
|
|
8.98%
|
|
7.78%
|
15
|
Efficiency
ratio
|
|
44.51%
|
|
51.01%
|
|
(13)
|
|
46.31%
|
|
52.09%
|
(11)
|
Dividend payout
ratio
|
|
15.53%
|
|
2.43%
|
|
539
|
|
14.80%
|
|
2.59%
|
471
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YIELD ANALYSIS
(Fully taxable equivalent)
|
|
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
|
4.06%
|
|
4.15%
|
|
(2)
|
|
4.11%
|
|
4.19%
|
(2)
|
Total
interest-bearing liabilities
|
|
0.97%
|
|
1.05%
|
|
(8)
|
|
0.98%
|
|
1.11%
|
(12)
|
Net interest
spread
|
|
3.09%
|
|
3.10%
|
|
(0)
|
|
3.13%
|
|
3.08%
|
2
|
Net interest
margin
|
|
3.31%
|
|
3.35%
|
|
(1)
|
|
3.35%
|
|
3.33%
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
RATIOS
|
|
September 30,
2014
|
|
September 30,
2013
|
|
December 31,
2013
|
|
Well Capitalized
Requirements
|
|
Minimum Regulatory
Requirements
|
|
Tier 1 risk-based
capital ratio
|
|
14.77%
|
|
14.88%
|
|
15.04%
|
|
6.0%
|
|
4.0%
|
|
Total risk-based
capital ratio
|
|
16.05%
|
|
16.65%
|
|
16.35%
|
|
10.0%
|
|
8.0%
|
|
Tier 1 leverage
capital ratio
|
|
12.66%
|
|
12.36%
|
|
12.48%
|
|
5.0%
|
|
4.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CATHAY GENERAL
BANCORP CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
|
|
(In thousands, except
share and per share data)
|
September 30,
2014
|
|
December 31,
2013
|
|
% change
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
Cash and due from
banks
|
$ 200,302
|
|
$ 153,747
|
|
30
|
Short-term
investments and interest bearing deposits
|
597,747
|
|
516,938
|
|
16
|
Securities
available-for-sale (amortized cost of $1,355,056 in 2014
and
|
|
|
|
|
|
$1,637,965 in
2013)
|
1,340,092
|
|
1,586,668
|
|
(16)
|
Trading
securities
|
-
|
|
4,936
|
|
(100)
|
Loans
|
8,858,254
|
|
8,084,563
|
|
10
|
Less:
Allowance for loan losses
|
(169,198)
|
|
(173,889)
|
|
(3)
|
Unamortized deferred loan fees, net
|
(12,903)
|
|
(13,487)
|
|
(4)
|
Loans, net
|
8,676,153
|
|
7,897,187
|
|
10
|
Federal Home Loan
Bank stock
|
34,090
|
|
25,000
|
|
36
|
Other real estate
owned, net
|
29,025
|
|
52,985
|
|
(45)
|
Affordable housing
investments, net
|
96,504
|
|
84,108
|
|
15
|
Premises and
equipment, net
|
100,673
|
|
102,045
|
|
(1)
|
Customers' liability
on acceptances
|
21,820
|
|
32,194
|
|
(32)
|
Accrued interest
receivable
|
24,986
|
|
24,274
|
|
3
|
Goodwill
|
316,340
|
|
316,340
|
|
-
|
Other intangible
assets, net
|
3,459
|
|
2,230
|
|
55
|
Other
assets
|
158,275
|
|
190,634
|
|
(17)
|
|
|
|
|
|
|
Total
assets
|
$ 11,599,466
|
|
$ 10,989,286
|
|
6
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
$ 1,593,003
|
|
$ 1,441,858
|
|
10
|
Interest-bearing
deposits:
|
|
|
|
|
|
NOW deposits
|
766,622
|
|
683,873
|
|
12
|
Money market deposits
|
1,514,496
|
|
1,286,338
|
|
18
|
Savings deposits
|
542,454
|
|
499,520
|
|
9
|
Time deposits under $100,000
|
1,103,634
|
|
931,204
|
|
19
|
Time deposits of $100,000 or more
|
3,174,460
|
|
3,138,512
|
|
1
|
Total deposits
|
8,694,669
|
|
7,981,305
|
|
9
|
|
|
|
|
|
|
Securities sold under
agreements to repurchase
|
550,000
|
|
800,000
|
|
(31)
|
Advances from the
Federal Home Loan Bank
|
555,000
|
|
521,200
|
|
6
|
Other borrowings for
affordable housing investments
|
18,882
|
|
19,062
|
|
(1)
|
Long-term
debt
|
119,136
|
|
121,136
|
|
(2)
|
Acceptances
outstanding
|
21,820
|
|
32,194
|
|
(32)
|
Other
liabilities
|
69,575
|
|
55,418
|
|
26
|
Total
liabilities
|
10,029,082
|
|
9,530,315
|
|
5
|
Commitments and contingencies
|
-
|
|
-
|
|
-
|
Stockholders'
Equity
|
|
|
|
|
|
Common stock, $0.01
par value, 100,000,000 shares authorized,
|
|
|
|
|
|
83,905,576 issued and
79,698,011 outstanding at September 30, 2014, and
83,797,434 issued and 79,589,869
outstanding at December 31, 2013
|
|
|
|
|
|
839
|
|
838
|
|
0
|
Additional
paid-in-capital
|
787,889
|
|
784,489
|
|
0
|
Accumulated other
comprehensive loss, net
|
(8,835)
|
|
(29,729)
|
|
(70)
|
Retained
earnings
|
916,227
|
|
829,109
|
|
11
|
Treasury stock, at
cost (4,207,565 shares at September 30, 2014,
|
|
|
|
|
|
and at December 31,
2013)
|
(125,736)
|
|
(125,736)
|
|
-
|
|
|
|
|
|
|
Total
equity
|
1,570,384
|
|
1,458,971
|
|
8
|
Total liabilities and
equity
|
$ 11,599,466
|
|
$ 10,989,286
|
|
6
|
|
|
|
|
|
|
Book value per common
share
|
$19.62
|
|
$18.24
|
|
8
|
Number of common
shares outstanding
|
79,698,011
|
|
79,589,869
|
|
0
|
CATHAY GENERAL
BANCORP
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
2014
|
2013
|
|
2014
|
2013
|
|
(In thousands, except
share and per share data)
|
INTEREST AND
DIVIDEND INCOME
|
|
|
|
|
|
Loan receivable,
including loan fees
|
$ 100,151
|
$ 90,838
|
|
$ 290,337
|
$ 267,557
|
Investment
securities- taxable
|
5,105
|
10,868
|
|
19,389
|
34,986
|
Investment
securities- nontaxable
|
-
|
-
|
|
-
|
995
|
Federal Home Loan
Bank stock
|
508
|
449
|
|
1,379
|
1,041
|
Deposits with
banks
|
571
|
307
|
|
1,499
|
796
|
|
|
|
|
|
|
Total interest and
dividend income
|
106,335
|
102,462
|
|
312,604
|
305,375
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
Time deposits of
$100,000 or more
|
7,107
|
6,887
|
|
20,519
|
20,466
|
Other
deposits
|
5,005
|
3,485
|
|
13,462
|
9,244
|
Securities sold under
agreements to repurchase
|
5,858
|
8,402
|
|
19,731
|
29,778
|
Advances from Federal
Home Loan Bank
|
153
|
150
|
|
849
|
375
|
Long-term
debt
|
1,456
|
930
|
|
3,012
|
2,778
|
Short-term
borrowings
|
1
|
-
|
|
1
|
-
|
|
|
|
|
|
|
Total interest
expense
|
19,580
|
19,854
|
|
57,574
|
62,641
|
|
|
|
|
|
|
Net interest income
before provision for credit losses
|
86,755
|
82,608
|
|
255,030
|
242,734
|
Reversal for credit
losses
|
(5,100)
|
(3,000)
|
|
(8,800)
|
(3,000)
|
|
|
|
|
|
|
Net interest income
after (reversal)/provision for credit losses
|
91,855
|
85,608
|
|
263,830
|
245,734
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
Securities gains,
net
|
361
|
8,688
|
|
6,827
|
27,157
|
Letters of credit
commissions
|
1,559
|
1,698
|
|
4,547
|
4,608
|
Depository service
fees
|
1,330
|
1,371
|
|
3,999
|
4,330
|
Other operating
income
|
5,724
|
4,963
|
|
17,181
|
15,867
|
|
|
|
|
|
|
Total non-interest
income
|
8,974
|
16,720
|
|
32,554
|
51,962
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
Salaries and employee
benefits
|
22,630
|
22,751
|
|
69,472
|
67,192
|
Occupancy
expense
|
3,934
|
3,812
|
|
11,692
|
10,966
|
Computer and
equipment expense
|
2,471
|
2,446
|
|
7,307
|
7,488
|
Professional services
expense
|
5,991
|
5,813
|
|
16,410
|
18,484
|
FDIC and State
assessments
|
2,261
|
1,712
|
|
6,692
|
5,431
|
Marketing
expense
|
639
|
1,097
|
|
2,722
|
2,703
|
Other real estate
owned (income)/expense
|
(1,011)
|
527
|
|
(629)
|
886
|
Operations of
affordable housing investments
|
1,672
|
1,234
|
|
5,126
|
4,952
|
Amortization of core
deposit intangibles
|
214
|
1,363
|
|
510
|
4,097
|
Costs associated with
debt redemptions
|
527
|
6,861
|
|
3,348
|
22,557
|
Other operating
expense
|
3,279
|
3,054
|
|
10,538
|
8,758
|
|
|
|
|
|
|
Total non-interest
expense
|
42,607
|
50,670
|
|
133,188
|
153,514
|
|
|
|
|
|
|
Income before income
tax expense
|
58,222
|
51,658
|
|
163,196
|
144,182
|
Income tax
expense
|
22,313
|
19,029
|
|
60,944
|
52,489
|
Net income
|
35,909
|
32,629
|
|
102,252
|
91,693
|
Less: net income
attributable to noncontrolling interest
|
-
|
151
|
|
-
|
452
|
Net income
attributable to Cathay General Bancorp
|
35,909
|
32,478
|
|
102,252
|
91,241
|
|
|
|
|
|
|
Dividends on
preferred stock and noncash charge from repayment
|
-
|
(2,434)
|
|
-
|
(9,685)
|
Net income
attributable to common stockholders
|
$ 35,909
|
$ 30,044
|
|
$ 102,252
|
$ 81,556
|
|
|
|
|
|
|
Net income
attributable to common stockholders per common share:
|
|
|
|
|
|
Basic
|
$ 0.45
|
$ 0.38
|
|
$ 1.28
|
$ 1.03
|
Diluted
|
$ 0.45
|
$ 0.38
|
|
$ 1.28
|
$ 1.03
|
Cash dividends paid
per common share
|
$ 0.07
|
$ 0.01
|
|
$ 0.19
|
$ 0.03
|
Basic average common
shares outstanding
|
79,677,952
|
78,894,262
|
|
79,639,202
|
78,853,333
|
Diluted average
common shares outstanding
|
80,176,100
|
79,114,122
|
|
80,087,819
|
78,944,152
|
CATHAY
GENERAL BANCORP
AVERAGE BALANCES –
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(Unaudited)
|
|
|
Three months
ended,
|
|
(In
thousands)
|
September 30,
2014
|
|
September 30,
2013
|
|
June 30,
2014
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets
|
Average
Balance
|
Average Yield/Rate
(1) (2)
|
|
Average
Balance
|
Average Yield/Rate
(1) (2)
|
|
Average
Balance
|
Average Yield/Rate
(1) (2)
|
Loans (1)
|
$ 8,705,723
|
4.56%
|
|
$ 7,732,167
|
4.66%
|
|
$ 8,409,737
|
4.65%
|
Taxable investment
securities
|
1,288,207
|
1.57%
|
|
1,869,101
|
2.31%
|
|
1,510,183
|
1.78%
|
FHLB stock
|
32,057
|
6.29%
|
|
30,938
|
5.76%
|
|
27,979
|
6.04%
|
Deposits with
banks
|
363,722
|
0.62%
|
|
160,985
|
0.76%
|
|
252,552
|
0.76%
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
$ 10,389,709
|
4.06%
|
|
$ 9,793,191
|
4.15%
|
|
$ 10,200,451
|
4.13%
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$ 736,690
|
0.18%
|
|
$ 647,037
|
0.16%
|
|
$ 702,216
|
0.18%
|
Money market
deposits
|
1,527,888
|
0.63%
|
|
1,234,091
|
0.58%
|
|
1,303,129
|
0.62%
|
Savings
deposits
|
557,578
|
0.17%
|
|
471,849
|
0.07%
|
|
523,684
|
0.17%
|
Time
deposits
|
4,345,065
|
0.83%
|
|
4,069,612
|
0.80%
|
|
4,260,700
|
0.81%
|
Total
interest-bearing deposits
|
$ 7,167,221
|
0.67%
|
|
$ 6,422,589
|
0.64%
|
|
$ 6,789,729
|
0.66%
|
Securities sold under
agreements to repurchase
|
603,804
|
3.85%
|
|
855,435
|
3.90%
|
|
700,000
|
3.98%
|
Other borrowed
funds
|
102,267
|
0.60%
|
|
82,822
|
0.72%
|
|
222,618
|
0.90%
|
Long-term
debt
|
119,136
|
4.85%
|
|
171,136
|
2.16%
|
|
119,760
|
2.77%
|
Total
interest-bearing liabilities
|
7,992,428
|
0.97%
|
|
7,531,982
|
1.05%
|
|
7,832,107
|
1.00%
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
1,549,463
|
|
|
1,353,451
|
|
|
1,498,654
|
|
|
|
|
|
|
|
|
|
|
Total deposits and
other borrowed funds
|
$ 9,541,891
|
|
|
$ 8,885,433
|
|
|
$ 9,330,761
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$ 11,179,433
|
|
|
$ 10,519,491
|
|
|
$ 10,930,390
|
|
Total average
equity
|
$ 1,559,413
|
|
|
$ 1,547,606
|
|
|
$ 1,521,892
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine months
ended,
|
|
|
|
(In
thousands)
|
September 30,
2014
|
|
September 30,
2013
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets
|
Average
Balance
|
Average Yield/Rate
(1) (2)
|
|
Average
Balance
|
Average Yield/Rate
(1) (2)
|
|
|
|
Loans (1)
|
$ 8,426,226
|
4.61%
|
|
$ 7,524,439
|
4.75%
|
|
|
|
Taxable investment
securities
|
1,458,936
|
1.78%
|
|
1,977,788
|
2.37%
|
|
|
|
Tax-exempt investment
securities (2)
|
-
|
-
|
|
38,874
|
5.27%
|
|
|
|
FHLB stock
|
28,389
|
6.49%
|
|
35,685
|
3.90%
|
|
|
|
Deposits with
banks
|
255,627
|
0.78%
|
|
182,820
|
0.58%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
$ 10,169,178
|
4.11%
|
|
$ 9,759,606
|
4.19%
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$ 707,421
|
0.17%
|
|
$ 623,554
|
0.16%
|
|
|
|
Money market
deposits
|
1,369,838
|
0.62%
|
|
1,178,812
|
0.57%
|
|
|
|
Savings
deposits
|
526,768
|
0.14%
|
|
483,715
|
0.08%
|
|
|
|
Time
deposits
|
4,259,579
|
0.82%
|
|
3,975,160
|
0.80%
|
|
|
|
Total
interest-bearing deposits
|
$ 6,863,606
|
0.66%
|
|
$ 6,261,241
|
0.63%
|
|
|
|
Securities sold under
agreements to repurchase
|
669,963
|
3.94%
|
|
1,030,403
|
3.86%
|
|
|
|
Other borrowed
funds
|
166,445
|
0.68%
|
|
67,613
|
0.74%
|
|
|
|
Long-term
debt
|
120,003
|
3.36%
|
|
171,136
|
2.17%
|
|
|
|
Total
interest-bearing liabilities
|
7,820,017
|
0.98%
|
|
7,530,393
|
1.11%
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
1,498,181
|
|
|
1,284,579
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total deposits and
other borrowed funds
|
$ 9,318,198
|
|
|
$ 8,814,972
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$ 10,920,555
|
|
|
$ 10,471,330
|
|
|
|
|
Total average
equity
|
$ 1,522,772
|
|
|
$ 1,576,872
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Yields and interest
earned include net loan fees. Non-accrual loans are included in the
average balance.
|
(2)
|
The average yield has
been adjusted to a fully taxable-equivalent basis for certain
securities of states and political subdivisions and other securities held using a statutory
Federal income tax rate of 35%.
|
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SOURCE Cathay General Bancorp