LOS ANGELES, July 19, 2017 /PRNewswire/ -- Cathay General
Bancorp (the "Company", NASDAQ: CATY), the holding company for
Cathay Bank, today announced net income of $51.4 million, or $0.64 per share, for the second quarter of
2017.
FINANCIAL PERFORMANCE
|
Three months
ended
|
|
June 30,
2017
|
|
March 31,
2017
|
|
June 30,
2016
|
Net income
|
$51.4
million
|
|
$48.9
million
|
|
$34.8
million
|
Basic earnings per
common share
|
$0.64
|
|
$0.61
|
|
$0.44
|
Diluted earnings per
common share
|
$0.64
|
|
$0.61
|
|
$0.44
|
Return on average
assets
|
1.48%
|
|
1.42%
|
|
1.07%
|
Return on average
total stockholders' equity
|
10.96%
|
|
10.73%
|
|
8.00%
|
Efficiency
ratio
|
45.88%
|
|
43.66%
|
|
62.15%
|
SECOND QUARTER HIGHLIGHTS
- Diluted earnings per share increased 46% to $0.64 per share for the second quarter of 2017
compared to $0.44 per share for the
same quarter a year ago.
- Total loans increased $206
million, or 7% annualized, to $11.6
billion for the quarter.
"For the second quarter of 2017, our total loans increased
$206 million or 7% annualized to
$11.6 billion, despite a large number
of commercial real estate loan payoffs. Also, our net
interest margin increased to 3.63% during the second quarter
compared to 3.49% in the first quarter of 2017 as a result of
higher interest rates," commented Pin Tai, Chief Executive Officer
and President of the Company.
"We are pleased to complete the acquisition of SinoPac Bancorp,
the parent of Far East National Bank. Subsequent to the
acquisition, on July 17, 2017,
SinoPac Bancorp merged with and into Cathay General Bancorp.
Far East National Bank will continue as a direct subsidiary of
Cathay General Bancorp and operate independent of Cathay Bank until
further regulatory approval is obtained to merge Far East National
Bank into Cathay Bank," added Dunson
Cheng, Executive Chairman of the Board of the
Company.
SECOND QUARTER INCOME STATEMENT REVIEW
Net income for the quarter ended June 30,
2017, was $51.4 million, an
increase of $16.6 million, or 47.6%,
compared to net income of $34.8
million for the same quarter a year ago. Diluted
earnings per share for the quarter ended June 30, 2017, was $0.64 compared to $0.44 for the same quarter a year ago.
Return on average stockholders' equity was 10.96% and return on
average assets was 1.48% for the quarter ended June 30, 2017, compared to a return on average
stockholders' equity of 8.00% and a return on average assets of
1.07% for the same quarter a year ago.
Net interest income before provision for credit
losses
Net interest income before provision for credit losses increased
$15.6 million, or 15.3%, to
$117.4 million during the second
quarter of 2017 compared to $101.8
million during the same quarter a year ago. The
increase was due primarily to an increase in interest income from
loans and a decrease in interest expense from securities sold under
agreements to repurchase.
The net interest margin was 3.63% for the second quarter of 2017
compared to 3.38% for the second quarter of 2016 and 3.49% for the
first quarter of 2017.
For the second quarter of 2017, the yield on average
interest-earning assets was 4.19%, the cost of funds on average
interest-bearing liabilities was 0.78%, and the cost of
interest-bearing deposits was 0.68%. In comparison, for the
second quarter of 2016, the yield on average interest-earning
assets was 4.05%, the cost of funds on average interest-bearing
liabilities was 0.89%, and the cost of average interest-bearing
deposits was 0.70%. The increase in the yield on average interest
earning assets was a result of higher interest rates,
interest income collected from nonaccrual loans and loan prepayment
penalties. The net interest spread, defined as the difference
between the yield on average interest-earning assets and the cost
of funds on average interest-bearing liabilities, was 3.41% for the
quarter ended June 30, 2017, compared
to 3.16% for the same quarter a year ago.
Provision/(reversal) for credit losses
The provision for credit losses was zero for the second quarter
of 2017 compared to a reversal of $5.2
million for the second quarter of 2016. The
provision/(reversal) for credit losses was based on a review of the
appropriateness of the allowance for loan losses at June 30, 2017. The following table
summarizes the charge-offs and recoveries for the periods
indicated:
|
Three months
ended
|
|
Six months ended June
30,
|
|
June 30,
2017
|
|
March 31,
2017
|
|
June 30,
2016
|
|
2017
|
|
2016
|
|
(In
thousands)
|
Charge-offs:
|
|
|
|
|
|
|
|
|
|
Commercial
loans
|
$
526
|
|
$
1,204
|
|
$
6,688
|
|
$
1,730
|
|
$
8,757
|
Real estate
loans (1)
|
-
|
|
555
|
|
945
|
|
555
|
|
1,204
|
Total
charge-offs
|
526
|
|
1,759
|
|
7,633
|
|
2,285
|
|
9,961
|
Recoveries:
|
|
|
|
|
|
|
|
|
|
Commercial
loans
|
335
|
|
491
|
|
727
|
|
826
|
|
1,714
|
Construction
loans
|
47
|
|
49
|
|
47
|
|
96
|
|
7,323
|
Real estate
loans(1)
|
410
|
|
296
|
|
405
|
|
706
|
|
560
|
Total recoveries
|
792
|
|
836
|
|
1,179
|
|
1,628
|
|
9,597
|
Net
(recoveries)/charge-offs
|
$
(266)
|
|
$
923
|
|
$
6,454
|
|
$
657
|
|
$
364
|
|
(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), wire transfer fees, and other sources of fee income, was
$6.2 million for the second quarter
of 2017, a decrease of $2.9 million,
or 32.1%, compared to $9.1 million
for the second quarter of 2016, primarily because of securities
gains of $1.7 million recorded in the
second quarter of 2016.
Non-interest expense
Non-interest expense decreased $12.2
million, or 17.7%, to $56.7
million in the second quarter of 2017 compared to
$68.9 million in the same quarter a
year ago. For the second quarter of 2017, amortization of
investments in affordable housing and alternative energy
partnerships decreased $21.2 million,
which was offset by a $4.6 million
increase in salary and employee benefit expenses and a $2.8 million increase in other operating expense
when compared to the same quarter a year ago. The efficiency
ratio was 45.9% in the second quarter of 2017 compared to 62.2% for
the same quarter a year ago.
Income taxes
The effective tax rate for the second quarter of 2017 was 23.1%
compared to 26.1% for the second quarter of 2016. The
effective tax rate includes the impact of low income housing tax
credits and an alternative energy tax credit investment made in the
second quarter. Income tax expense for the first quarter of
2017 was also reduced by $2.6 million
in benefits from the distribution of restricted stock units and
exercises of stock options.
BALANCE SHEET REVIEW
Gross loans, excluding loans held for sale, were $11.6 billion at June 30,
2017, an increase of $370
million, or 3.3%, from $11.2
billion at December 31,
2016. The increase was primarily due to increases of
$312.0 million, or 12.8%, in
residential mortgage loans, and $98.5
million, or 1.7%, in commercial mortgage loans partially
offset by decreases of $32.2 million,
or 1.4%, in commercial loans. The loan balances and
composition at June 30, 2017,
compared to December 31, 2016, and to
June 30, 2016, are presented
below:
|
June 30,
2017
|
|
December 31,
2016
|
|
June 30,
2016
|
|
(In
thousands)
|
Commercial
loans
|
$
2,215,960
|
|
$
2,248,187
|
|
$
2,188,047
|
Residential mortgage
loans
|
2,756,055
|
|
2,444,048
|
|
2,146,895
|
Commercial mortgage
loans
|
5,883,770
|
|
5,785,248
|
|
5,531,186
|
Equity
lines
|
162,153
|
|
171,711
|
|
171,972
|
Real estate
construction loans
|
547,737
|
|
548,088
|
|
481,820
|
Installment &
other loans
|
5,557
|
|
3,993
|
|
3,180
|
|
|
|
|
|
|
Gross
loans
|
$
11,571,232
|
|
$
11,201,275
|
|
$
10,523,100
|
|
|
|
|
|
|
Allowance for loan
losses
|
(115,809)
|
|
(118,966)
|
|
(122,948)
|
Unamortized deferred
loan fees
|
(3,788)
|
|
(4,994)
|
|
(6,679)
|
|
|
|
|
|
|
Total loans,
net
|
$
11,451,635
|
|
$
11,077,315
|
|
$
10,393,473
|
Loans held for
sale
|
$
-
|
|
$
7,500
|
|
$
2,925
|
Total deposits were $11.5 billion
at June 30, 2017, a decrease of
$211 million, or 1.8%, from
$11.7 billion at December 31, 2016, and an increase of
$1.0 billion, or 9.5%, from
$10.5 billion at June 30, 2016. The deposit balances and
composition at June 30, 2017,
compared to December 31, 2016, and to
June 30, 2016, are presented
below:
|
June 30,
2017
|
|
December 31,
2016
|
|
June 30,
2016
|
|
(In
thousands)
|
Non-interest-bearing
demand deposits
|
$
2,436,820
|
|
$
2,478,107
|
|
$
2,188,072
|
NOW
deposits
|
1,273,066
|
|
1,230,445
|
|
1,018,388
|
Money market
deposits
|
2,267,392
|
|
2,198,938
|
|
2,066,349
|
Savings
deposits
|
884,238
|
|
719,949
|
|
620,094
|
Time
deposits
|
4,601,801
|
|
5,047,287
|
|
4,578,200
|
Total
deposits
|
$
11,463,317
|
|
$
11,674,726
|
|
$
10,471,103
|
ASSET QUALITY REVIEW
At June 30, 2017, total
non-accrual loans were $64.0 million,
an increase of $14.3 million, or
28.9%, resulting from several construction and commercial real
estate loans placed on nonaccrual, from $49.7 million at December
31, 2016, and an increase of $10.9
million, or 20.5%, from $53.1
million at June 30,
2016.
The allowance for loan losses was $115.8
million and the allowance for off-balance sheet unfunded
credit commitments was $4.5 million
at June 30, 2017, which represented
the amount believed by management to be appropriate to absorb
credit losses inherent in the loan portfolio, including unfunded
commitments. The $115.8 million
allowance for loan losses at June 30,
2017, decreased $3.2 million,
or 2.7%, from $119.0 million at
December 31, 2016. The
allowance for loan losses represented 1.00% of period-end gross
loans, excluding loans held for sale, and 179.4% of non-performing
loans at June 30, 2017. The
comparable ratios were 1.06% of period-end gross loans, excluding
loans held for sale, and 239.5% of non-performing loans at
December 31, 2016. The changes
in non-performing assets and troubled debt restructurings at
June 30, 2017, compared to
December 31, 2016, and to
June 30, 2016, are highlighted
below:
(Dollars in
thousands)
|
June 30,
2017
|
|
December 31,
2016
|
|
% Change
|
|
June 30,
2016
|
|
% Change
|
Non-performing
assets
|
|
|
|
|
|
|
|
|
|
Accruing loans past
due 90 days or more
|
$
495
|
|
$
-
|
|
100
|
|
$
-
|
|
100
|
Non-accrual
loans:
|
|
|
|
|
|
|
|
|
|
Construction
loans
|
16,585
|
|
5,458
|
|
204
|
|
6,081
|
|
173
|
Commercial
mortgage loans
|
27,448
|
|
20,078
|
|
37
|
|
30,725
|
|
(11)
|
Commercial
loans
|
13,064
|
|
15,710
|
|
(17)
|
|
8,251
|
|
58
|
Residential
mortgage loans
|
6,947
|
|
8,436
|
|
(18)
|
|
8,081
|
|
(14)
|
Total non-accrual
loans:
|
$
64,044
|
|
$
49,682
|
|
29
|
|
$
53,138
|
|
21
|
Total
non-performing loans
|
64,539
|
|
49,682
|
|
30
|
|
53,138
|
|
21
|
Other real
estate owned
|
19,230
|
|
20,070
|
|
(4)
|
|
26,417
|
|
(27)
|
Total
non-performing assets
|
$
83,769
|
|
$
69,752
|
|
20
|
|
$
79,555
|
|
5
|
Accruing
troubled debt restructurings (TDRs)
|
$
79,819
|
|
$
65,393
|
|
22
|
|
$
74,708
|
|
7
|
Non-accrual loans
held for sale
|
$
-
|
|
$
7,500
|
|
(100)
|
|
$
2,925
|
|
(100)
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses
|
$
115,809
|
|
$
118,966
|
|
(3)
|
|
$
122,948
|
|
(6)
|
|
|
|
|
|
|
|
|
|
|
Total gross loans
outstanding, at period-end (1)
|
$
11,571,232
|
|
$
11,201,275
|
|
3
|
|
$
10,523,100
|
|
10
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses to non-performing loans, at period-end
(2)
|
179.44%
|
|
239.45%
|
|
|
|
231.37%
|
|
|
Allowance for loan
losses to gross loans, at period-end (1)
|
1.00%
|
|
1.06%
|
|
|
|
1.17%
|
|
|
|
(1) Excludes loans
held for sale at period-end.
|
(2) Excludes
non-accrual loans held for sale at period-end.
|
The ratio of non-performing assets, excluding non-accrual loans
held for sale, to total assets was 0.6% at June 30, 2017, compared to 0.5% at December 31, 2016. Total non-performing
assets increased $14.0 million, or
20.1%, to $83.8 million at
June 30, 2017, compared to
$69.8 million at December 31, 2016, primarily due to an increase
of $14.4 million, or 28.9%, in
non-accrual loans offset by a decrease of $840 thousand, or 4.2%, in other real estate
owned.
CAPITAL ADEQUACY REVIEW
At June 30, 2017, the Company's
common equity Tier 1 capital ratio of 13.26%, Tier 1 risk-based
capital ratio of 14.27%, total risk-based capital ratio of 15.35%,
and Tier 1 leverage capital ratio of 12.08%, calculated under the
Basel III capital rules, continue to place the Company in the "well
capitalized" category for regulatory purposes, which is defined as
institutions with a common equity tier 1 capital ratio equal to or
greater than 6.5%, a Tier 1 risk-based capital ratio equal to or
greater than 8%, 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,
2016, the Company's common equity Tier 1 capital ratio was
12.84%, Tier 1 risk-based capital ratio was 13.85%, total
risk-based capital ratio was 14.97%, and Tier 1 leverage capital
ratio was 11.57%.
YEAR-TO-DATE REVIEW
Net income for the six months ended June
30, 2017, was $100.4 million,
an increase of $19.4 million, or
23.9%, compared to net income of $81.0
million for the same period a year ago. Diluted
earnings per share was $1.25 compared
to $1.01 per share for the same
period a year ago. The net interest margin for the six months
ended June 30, 2017, was 3.56%
compared to 3.40% for the same period a year ago.
Return on average stockholders' equity was 10.84% and return on
average assets was 1.45% for the six months ended June 30, 2017, compared to a return on average
stockholders' equity of 9.33% and a return on average assets of
1.25% for the same period of 2016. The efficiency ratio for
the six months ended June 30, 2017,
was 44.79% compared to 54.57% for the same period a year ago.
CONFERENCE CALL
Cathay General Bancorp will host a conference call this
afternoon to discuss its second quarter 2017 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
1-855-761-3186 and enter Conference ID 50675285. 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
and Far East National Bank, a U.S. federally chartered bank.
Founded in 1962, Cathay Bank offers a wide range of financial
services. Cathay Bank currently operates 34 branches in
California, 12 branches in
New York State, three in the
Chicago, Illinois area, three in
Washington State, two in
Texas, one in Maryland, one in Massachusetts, one in Nevada, one in New
Jersey, one in Hong Kong,
and a representative office in Taipei and in Shanghai. Cathay Bank's website is found at
www.cathaybank.com. Founded in 1974, Far East National Bank
offers a wide range of financial services. Far East National
Bank operates nine branches in California, and a representative office in
Beijing. Far East National Bank's website is found at
www.fareastnationalbank.com. Information set forth on such
websites are not incorporated into this press release.
FORWARD-LOOKING STATEMENTS
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;
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; the soundness of other financial
institutions; our ability to realize the anticipated benefits of
our acquisitions, including the recent acquisition of SinoPac
Bancorp and Far East National Bank; the risk that integration of
SinoPac Bancorp's and Far East National Bank's operations with
those of the Company and Cathay Bank will be materially delayed or
will be more costly or difficult than expected; the diversion of
management's attention from ongoing business operations and
opportunities; the challenges of integrating and retaining key
employees; and general competitive, economic political, and market
conditions and fluctuations.
These and other factors are further described in Cathay General
Bancorp's Annual Report on Form 10-K for the year ended
December 31, 2016 (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
|
CONSOLIDATED
FINANCIAL HIGHLIGHTS
|
(Unaudited)
|
|
|
|
Three months
ended
|
|
Six months ended June
30,
|
(Dollars in
thousands, except per share data)
|
|
June 30,
2017
|
|
March 31,
2017
|
|
June 30,
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
PERFORMANCE
|
|
|
|
|
|
|
|
|
|
|
Net interest income
before provision for credit
losses
|
|
$
117,352
|
|
$
112,114
|
|
$
101,776
|
|
$229,466
|
|
$
204,144
|
Reversal for credit
losses
|
|
-
|
|
(2,500)
|
|
(5,150)
|
|
(2,500)
|
|
(15,650)
|
Net interest income
after reversal for credit losses
|
|
117,352
|
|
114,614
|
|
106,926
|
|
231,966
|
|
219,794
|
Non-interest
income
|
|
6,152
|
|
6,718
|
|
9,057
|
|
12,870
|
|
16,598
|
Non-interest
expense
|
|
56,658
|
|
51,886
|
|
68,879
|
|
108,544
|
|
120,450
|
Income before income
tax expense
|
|
66,846
|
|
69,446
|
|
47,104
|
|
136,292
|
|
115,942
|
Income tax
expense
|
|
15,431
|
|
20,505
|
|
12,273
|
|
35,936
|
|
34,948
|
Net income
|
|
$
51,415
|
|
$
48,941
|
|
$
34,831
|
|
100,356
|
|
80,994
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common
share
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.64
|
|
$
0.61
|
|
$
0.44
|
|
$
1.26
|
|
$
1.02
|
Diluted
|
|
$
0.64
|
|
$
0.61
|
|
$
0.44
|
|
$
1.25
|
|
$
1.01
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends
paid per common share
|
|
$
0.21
|
|
$
0.21
|
|
$
0.18
|
|
$
0.42
|
|
$
0.36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED
RATIOS
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
1.48%
|
|
1.42%
|
|
1.07%
|
|
1.45%
|
|
1.25%
|
Return on average
total stockholders' equity
|
|
10.96%
|
|
10.73%
|
|
8.00%
|
|
10.84%
|
|
9.33%
|
Efficiency
ratio
|
|
45.88%
|
|
43.66%
|
|
62.15%
|
|
44.79%
|
|
54.57%
|
Dividend payout
ratio
|
|
32.61%
|
|
34.24%
|
|
40.75%
|
|
33.40%
|
|
35.03%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YIELD ANALYSIS
(Fully taxable equivalent)
|
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
|
4.19%
|
|
4.07%
|
|
4.05%
|
|
4.13%
|
|
4.07%
|
Total
interest-bearing liabilities
|
|
0.78%
|
|
0.80%
|
|
0.89%
|
|
0.79%
|
|
0.89%
|
Net interest
spread
|
|
3.41%
|
|
3.27%
|
|
3.16%
|
|
3.34%
|
|
3.18%
|
Net interest
margin
|
|
3.63%
|
|
3.49%
|
|
3.38%
|
|
3.56%
|
|
3.40%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
RATIOS
|
|
June 30,
2017
|
|
December 31,
2016
|
|
June 30,
2016
|
|
|
|
|
Common Equity Tier 1
capital ratio
|
|
13.26%
|
|
12.84%
|
|
12.73%
|
|
|
|
|
Tier 1 risk-based
capital ratio
|
|
14.27%
|
|
13.85%
|
|
13.79%
|
|
|
|
|
Total risk-based
capital ratio
|
|
15.35%
|
|
14.97%
|
|
14.97%
|
|
|
|
|
Tier 1 leverage
capital ratio
|
|
12.08%
|
|
11.57%
|
|
11.80%
|
|
|
|
|
|
|
.
|
|
|
|
|
|
|
|
|
CATHAY GENERAL
BANCORP
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
|
(In thousands, except
share and per share data)
|
|
June 30,
2017
|
|
December 31,
2016
|
|
June 30,
2016
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
160,517
|
|
$
218,017
|
|
$
229,411
|
Short-term
investments and interest bearing deposits
|
|
393,895
|
|
967,067
|
|
706,927
|
Securities
available-for-sale (amortized cost of $1,366,624 at June 30,
2017, $1,317,012 at December 31,
2016, and $1,227,169 at June 30, 2016)
|
|
1,368,351
|
|
1,314,345
|
|
1,241,904
|
Loans held for
sale
|
|
-
|
|
7,500
|
|
2,925
|
Loans
|
|
11,571,232
|
|
11,201,275
|
|
10,523,100
|
Less: Allowance
for loan losses
|
|
(115,809)
|
|
(118,966)
|
|
(122,948)
|
Unamortized
deferred loan fees, net
|
|
(3,788)
|
|
(4,994)
|
|
(6,679)
|
Loans,
net
|
|
11,451,635
|
|
11,077,315
|
|
10,393,473
|
Federal Home Loan
Bank stock
|
|
17,250
|
|
17,250
|
|
17,250
|
Other real estate
owned, net
|
|
19,230
|
|
20,070
|
|
26,417
|
Affordable housing
investments and alternative energy partnerships, net
|
|
288,902
|
|
251,077
|
|
199,210
|
Premises and
equipment, net
|
|
104,131
|
|
105,607
|
|
107,236
|
Customers' liability
on acceptances
|
|
9,897
|
|
12,182
|
|
26,096
|
Accrued interest
receivable
|
|
36,836
|
|
37,299
|
|
30,941
|
Goodwill
|
|
372,189
|
|
372,189
|
|
372,189
|
Other intangible
assets, net
|
|
2,537
|
|
2,949
|
|
3,310
|
Other
assets
|
|
111,415
|
|
117,902
|
|
135,888
|
|
|
|
|
|
|
|
Total
assets
|
|
$
14,336,785
|
|
$
14,520,769
|
|
$
13,493,177
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
$
2,436,820
|
|
$
2,478,107
|
|
$
2,188,072
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
NOW
deposits
|
|
1,273,066
|
|
1,230,445
|
|
1,018,388
|
Money market
deposits
|
|
2,267,392
|
|
2,198,938
|
|
2,066,349
|
Savings
deposits
|
|
884,238
|
|
719,949
|
|
620,094
|
Time
deposits
|
|
4,601,801
|
|
5,047,287
|
|
4,578,200
|
Total
deposits
|
|
11,463,317
|
|
11,674,726
|
|
10,471,103
|
|
|
|
|
|
|
|
Securities sold under
agreements to repurchase
|
|
150,000
|
|
350,000
|
|
400,000
|
Advances from the
Federal Home Loan Bank
|
|
475,000
|
|
350,000
|
|
555,000
|
Other borrowings for
affordable housing investments
|
|
17,564
|
|
17,662
|
|
17,748
|
Long-term
debt
|
|
119,136
|
|
119,136
|
|
119,136
|
Acceptances
outstanding
|
|
9,897
|
|
12,182
|
|
26,096
|
Other
liabilities
|
|
204,105
|
|
168,524
|
|
145,039
|
Total
liabilities
|
|
12,439,019
|
|
12,692,230
|
|
11,734,122
|
Commitments and
contingencies
|
|
-
|
|
-
|
|
-
|
Stockholders'
Equity
|
|
|
|
|
|
|
Common stock, $0.01
par value, 100,000,000 shares authorized, 88,072,997 issued and 79,862,354 outstanding at June
30, 2017,
87,820,920 issued and
79,610,277 outstanding at December 31, 2016, and
87,072,749 issued and 78,862,106
outstanding at June 30, 2016
|
|
881
|
|
878
|
|
871
|
Additional
paid-in-capital
|
|
895,578
|
|
895,480
|
|
884,352
|
Accumulated other
comprehensive income/(loss), net
|
|
(1,420)
|
|
(3,715)
|
|
1,142
|
Retained
earnings
|
|
1,242,316
|
|
1,175,485
|
|
1,112,279
|
Treasury stock, at
cost (8,210,643 shares at June 30, 2017, at December 31, 2016, and at June 30,
2016)
|
|
(239,589)
|
|
(239,589)
|
|
(239,589)
|
|
|
|
|
|
|
|
Total
equity
|
|
1,897,766
|
|
1,828,539
|
|
1,759,055
|
Total liabilities and
equity
|
|
$
14,336,785
|
|
$
14,520,769
|
|
$
13,493,177
|
|
|
|
|
|
|
|
Book value per common
share
|
|
$
23.64
|
|
$
22.80
|
|
$
22.15
|
Number of common
shares outstanding
|
|
79,862,354
|
|
79,610,277
|
|
78,862,106
|
CATHAY GENERAL
BANCORP
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Unaudited)
|
|
|
|
Three months
ended
|
|
Six months ended June
30,
|
|
|
June 30,
2017
|
March 31,
2017
|
June 30,
2016
|
|
2017
|
2016
|
|
|
(In thousands, except
share and per share data)
|
INTEREST AND
DIVIDEND INCOME
|
|
|
|
|
|
|
|
Loan receivable,
including loan fees
|
|
$
129,836
|
$
124,910
|
$
115,822
|
|
$
254,746
|
$
230,712
|
Investment
securities
|
|
4,719
|
4,406
|
5,265
|
|
9,125
|
12,124
|
Federal Home Loan
Bank stock
|
|
298
|
412
|
382
|
|
710
|
729
|
Deposits with
banks
|
|
776
|
1,076
|
433
|
|
1,852
|
682
|
|
|
|
|
|
|
|
|
Total interest and
dividend income
|
|
135,629
|
130,804
|
121,902
|
|
266,433
|
244,247
|
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
|
Time
deposits
|
|
10,769
|
10,982
|
10,619
|
|
21,751
|
21,476
|
Other
deposits
|
|
4,698
|
4,446
|
3,931
|
|
9,144
|
7,571
|
Securities sold under
agreements to repurchase
|
|
1,065
|
1,550
|
3,934
|
|
2,615
|
7,868
|
Advances from Federal
Home Loan Bank
|
|
305
|
288
|
202
|
|
593
|
308
|
Long-term
debt
|
|
1,440
|
1,424
|
1,440
|
|
2,864
|
2,880
|
|
|
|
|
|
|
|
|
Total interest
expense
|
|
18,277
|
18,690
|
20,126
|
|
36,967
|
40,103
|
|
|
|
|
|
|
|
|
Net interest income
before reversal for credit losses
|
|
117,352
|
112,114
|
101,776
|
|
229,466
|
204,144
|
Reversal for credit
losses
|
|
-
|
(2,500)
|
(5,150)
|
|
(2,500)
|
(15,650)
|
|
|
|
|
|
|
|
|
Net interest income
after reversal for credit losses
|
|
117,352
|
114,614
|
106,926
|
|
231,966
|
219,794
|
|
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
|
|
Securities
(losses)/gains, net
|
|
3
|
(466)
|
1,655
|
|
(463)
|
1,449
|
Letters of credit
commissions
|
|
1,193
|
1,123
|
1,205
|
|
2,316
|
2,486
|
Depository service
fees
|
|
1,344
|
1,508
|
1,385
|
|
2,852
|
2,708
|
Other operating
income
|
|
3,612
|
4,553
|
4,812
|
|
8,165
|
9,955
|
|
|
|
|
|
|
|
|
Total non-interest
income
|
|
6,152
|
6,718
|
9,057
|
|
12,870
|
16,598
|
|
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
26,145
|
25,871
|
21,501
|
|
52,016
|
48,432
|
Occupancy
expense
|
|
4,722
|
4,699
|
4,484
|
|
9,421
|
8,853
|
Computer and
equipment expense
|
|
2,528
|
2,724
|
2,443
|
|
5,252
|
5,023
|
Professional services
expense
|
|
5,343
|
4,256
|
4,614
|
|
9,599
|
8,982
|
Data processing
service expense
|
|
2,396
|
2,532
|
2,027
|
|
4,928
|
4,277
|
FDIC and State
assessments
|
|
2,189
|
2,520
|
2,763
|
|
4,709
|
5,352
|
Marketing
expense
|
|
1,859
|
871
|
1,002
|
|
2,730
|
1,798
|
Other real estate
owned expense
|
|
317
|
61
|
493
|
|
378
|
788
|
Amortization of
investments in low income housing and alternative energy
partnerships
|
|
6,224
|
4,850
|
27,400
|
|
11,074
|
30,194
|
Amortization of core
deposit intangibles
|
|
173
|
172
|
173
|
|
345
|
345
|
Other operating
expense
|
|
4,762
|
3,330
|
1,979
|
|
8,092
|
6,406
|
|
|
|
|
|
|
|
|
Total non-interest
expense
|
|
56,658
|
51,886
|
68,879
|
|
108,544
|
120,450
|
|
|
|
|
|
|
|
|
Income before income
tax expense
|
|
66,846
|
69,446
|
47,104
|
|
136,292
|
115,942
|
Income tax
expense
|
|
15,431
|
20,505
|
12,273
|
|
35,936
|
34,948
|
Net income
|
|
$
51,415
|
$
48,941
|
$
34,831
|
|
100,356
|
80,994
|
|
|
|
|
|
|
|
|
Net income per common
share:
|
|
|
|
|
|
|
|
Basic
|
|
$
0.64
|
$
0.61
|
$
0.44
|
|
$
1.26
|
$
1.02
|
Diluted
|
|
$
0.64
|
$
0.61
|
$
0.44
|
|
$
1.25
|
$
1.01
|
|
|
|
|
|
|
|
|
Cash dividends paid
per common share
|
|
$
0.21
|
$
0.21
|
$
0.18
|
|
$
0.42
|
$
0.36
|
Basic average common
shares outstanding
|
|
79,840,188
|
79,703,593
|
78,846,237
|
|
79,772,268
|
79,290,378
|
Diluted average
common shares outstanding
|
|
80,562,607
|
80,413,178
|
79,619,883
|
|
80,488,305
|
80,006,866
|
CATHAY GENERAL
BANCORP
|
AVERAGE BALANCES –
SELECTED CONSOLIDATED FINANCIAL INFORMATION
|
(Unaudited)
|
|
Three months
ended
|
|
(In
thousands)
|
June 30,
2017
|
|
March 31,
2017
|
|
June 30,
2016
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets
|
Average
Balance
|
Average
Yield/Rate (1)
|
|
Average
Balance
|
Average
Yield/Rate (1)
|
|
Average
Balance
|
Average
Yield/Rate (1)
|
Loans
(1)
|
$
11,388,056
|
4.57%
|
|
$
11,289,364
|
4.49%
|
|
$
10,441,941
|
4.46%
|
Taxable investment
securities
|
1,260,646
|
1.50%
|
|
1,234,071
|
1.45%
|
|
1,293,490
|
1.64%
|
FHLB stock
|
17,250
|
6.93%
|
|
17,250
|
9.69%
|
|
17,250
|
8.91%
|
Deposits with
banks
|
302,224
|
1.03%
|
|
486,045
|
0.90%
|
|
358,944
|
0.49%
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
$
12,968,176
|
4.19%
|
|
$
13,026,730
|
4.07%
|
|
$
12,111,625
|
4.05%
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$
1,260,574
|
0.17%
|
|
$
1,237,398
|
0.17%
|
|
$
1,013,028
|
0.17%
|
Money market
deposits
|
2,304,586
|
0.66%
|
|
2,276,057
|
0.65%
|
|
2,017,867
|
0.65%
|
Savings
deposits
|
794,450
|
0.20%
|
|
713,198
|
0.16%
|
|
630,042
|
0.17%
|
Time
deposits
|
4,722,920
|
0.91%
|
|
4,857,876
|
0.92%
|
|
4,707,847
|
0.91%
|
Total
interest-bearing deposits
|
$
9,082,530
|
0.68%
|
|
$
9,084,529
|
0.69%
|
|
$
8,368,784
|
0.70%
|
Securities sold under
agreements to repurchase
|
150,000
|
2.85%
|
|
189,444
|
3.32%
|
|
400,000
|
3.96%
|
Other borrowed
funds
|
103,538
|
1.18%
|
|
101,546
|
1.15%
|
|
166,191
|
0.49%
|
Long-term
debt
|
119,136
|
4.85%
|
|
119,136
|
4.85%
|
|
119,136
|
4.86%
|
Total
interest-bearing liabilities
|
9,455,204
|
0.78%
|
|
9,494,655
|
0.80%
|
|
9,054,111
|
0.89%
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
2,440,181
|
|
|
2,471,165
|
|
|
2,106,062
|
|
|
|
|
|
|
|
|
|
|
Total deposits and
other borrowed funds
|
$
11,895,385
|
|
|
$
11,965,820
|
|
|
$
11,160,173
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$
13,964,206
|
|
|
$
13,997,964
|
|
|
$
13,090,024
|
|
Total average
equity
|
$
1,882,454
|
|
|
$
1,850,254
|
|
|
$
1,750,936
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months
ended,
|
|
|
|
(In
thousands)
|
June 30,
2017
|
|
June 30,
2016
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets
|
Average
Balance
|
Average
Yield/Rate
(1)
|
|
Average
Balance
|
Average
Yield/Rate (1)
|
|
|
|
Loans
(1)
|
$
11,338,983
|
4.53%
|
|
$
10,366,256
|
4.48%
|
|
|
|
Taxable investment
securities
|
1,247,432
|
1.48%
|
|
1,424,671
|
1.71%
|
|
|
|
FHLB stock
|
17,250
|
8.30%
|
|
17,250
|
8.50%
|
|
|
|
Deposits with
banks
|
393,627
|
0.95%
|
|
261,771
|
0.52%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
$
12,997,292
|
4.13%
|
|
$
12,069,948
|
4.07%
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$
1,249,050
|
0.17%
|
|
$
989,404
|
0.17%
|
|
|
|
Money market
deposits
|
2,290,400
|
0.65%
|
|
1,971,638
|
0.64%
|
|
|
|
Savings
deposits
|
754,049
|
0.18%
|
|
625,335
|
0.16%
|
|
|
|
Time
deposits
|
4,790,025
|
0.92%
|
|
4,804,167
|
0.90%
|
|
|
|
Total
interest-bearing deposits
|
$
9,083,524
|
0.69%
|
|
$
8,390,544
|
0.70%
|
|
|
|
Securities sold under
agreements to repurchase
|
169,613
|
3.11%
|
|
400,000
|
3.96%
|
|
|
|
Other borrowed
funds
|
102,547
|
1.17%
|
|
125,488
|
0.49%
|
|
|
|
Long-term
debt
|
119,136
|
4.85%
|
|
119,136
|
4.86%
|
|
|
|
Total
interest-bearing liabilities
|
9,474,820
|
0.79%
|
|
9,035,168
|
0.89%
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
2,455,587
|
|
|
2,069,878
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total deposits and
other borrowed funds
|
$
11,930,407
|
|
|
$
11,105,046
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$
13,980,991
|
|
|
$
13,031,297
|
|
|
|
|
Total average
equity
|
$
1,866,443
|
|
|
$
1,746,339
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Yields and
interest earned include net loan fees. Non-accrual loans are
included in the average balance.
|
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SOURCE Cathay General Bancorp