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East West Bancorp Reports Net Income for Third Quarter of 2023 of $288 Million and Diluted Earnings Per Share of $2.02; Record Third Quarter Revenue and Net Interest Income

East West Bancorp, Inc. (“East West” or the “Company”) (Nasdaq: EWBC), parent company of East West Bank, reported its financial results for the third quarter of 2023. Third quarter 2023 net income was $288 million, or $2.02 per diluted share. Total loans reached a record $50.9 billion as of September 30, 2023. Return on average assets was 1.66%, return on average common equity was 17.28%, and return on average tangible common equity1 was 18.65%.

“East West has continued to grow and support its customers. During the third quarter, we drove record quarterly revenue and net interest income, adding to record net income in the first half of this year,” said Dominic Ng, Chairman and Chief Executive Officer of East West. “We took a prudent approach to growth, adding a billion dollars in both loans and customer deposits. This growth and our industry-leading efficiency underscore the durable and diversified nature of our business model,” continued Ng.

“Our balance sheet positions us well to help our customers thrive. East West Bank is on track for another year of record earnings for 2023, and we look forward to entering 2024 with strength. Given our confidence in earnings generation, stable credit quality, and capital strength, East West’s board of directors has approved a restart of our share repurchase program in the fourth quarter,” Ng concluded.

FINANCIAL HIGHLIGHTS

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Quarter Ended

 

Year-over-Year Change

($ in millions, except per share data)

 

September 30, 2023

 

September 30, 2022

 

$

 

%

 

 

 

 

 

 

 

 

 

Revenue

 

$648

 

$627

 

$20

 

3%

Pre-tax, Pre-provision Income2

 

446

 

432

 

14

 

3

Net Income

 

288

 

295

 

(8)

 

(3)

Diluted Earnings per Share

 

$2.02

 

$2.08

 

$(0.06)

 

(3%)

Return on Average Assets

 

1.66%

 

1.86%

 

-20 bps

 

 

Return on Average Common Equity

 

17.28%

 

20.30%

 

-302 bps

 

 

Return on Average Tangible Common Equity1

 

18.65%

 

22.16%

 

-351 bps

 

 

Total Loans

 

$50,912

 

$47,457

 

$3,455

 

7%

Total Deposits

 

55,087

 

53,857

 

1,230

 

2

 

 

 

 

 

 

 

 

 

1

 

Tangible common equity and return on average tangible common equity are non-GAAP financial measures. See reconciliation of GAAP to non-GAAP measures in Table 13.

2

 

Pre-tax, pre-provision income is a non-GAAP financial measure. See reconciliation of GAAP to non-GAAP financial measures in Table 12.

BALANCE SHEET

  • Total Assets – Total assets were $68.3 billion as of September 30, 2023, a decrease of $0.2 billion from $68.5 billion as of June 30, 2023, reflecting increasing balance sheet efficiency.



    Third quarter 2023 average interest-earning assets of $65.1 billion were up $1.0 billion, or 2%, from $64.1 billion in the second quarter of 2023, primarily due to an increase of $1.0 billion in average loans outstanding.
  • Total Loans – Total loans reached a record $50.9 billion as of September 30, 2023, an increase of $1.1 billion, or 2%, from $49.8 billion as of June 30, 2023. Year-over-year, total loans were up $3.5 billion, or 7%, from $47.5 billion as of September 30, 2022.



    Third quarter 2023 average loans of $49.9 billion grew $1.0 billion, or 2%, from the second quarter of 2023. The increase was driven by growth across all our major loan portfolios.
  • Total Deposits – Total deposits were $55.1 billion as of September 30, 2023, a decrease of $0.6 billion, or 1%, from $55.7 billion as of June 30, 2023, reflecting a $1.6 billion reduction in wholesale deposits, partially offset by an increase of $1 billion in customer deposits. Noninterest-bearing deposits made up 29% of our total deposits as of September 30, 2023, down from 30% as of June 30, 2023. Year-over-year, total deposits increased $1.2 billion, or 2%, from $53.9 billion as of September 30, 2022.



    Third quarter 2023 average deposits of $55.2 billion increased $0.9 billion, or 2%, from the second quarter of 2023. During the third quarter, growth in average money market and time deposits was offset by declines in other deposit categories, which largely reflected our commercial and consumer customers reallocating balances to products with higher yields.
  • Strong Capital Levels – As of September 30, 2023, stockholders’ equity was $6.6 billion, or $46.62 per share, both up 2% quarter-over-quarter. The stockholders’ equity to asset ratio was 9.66% as of September 30, 2023, an increase of 23 basis points quarter-over-quarter.



    As of September 30, 2023, tangible book value3 per share was $43.29, up 2% quarter-over-quarter and 18% year-over-year. The tangible common equity ratio3 was 9.03%, an increase of 23 basis points quarter-over-quarter.



    All of East West’s regulatory capital ratios are well in excess of regulatory requirements for well-capitalized institutions, as well as above regional and national bank averages. The common equity tier 1 (“CET1”) capital ratio increased to 13.30%, and the total risk-based capital ratio increased to 14.74%, as of September 30, 2023.

OPERATING RESULTS

Third Quarter Earnings – Third quarter 2023 net income was $288 million, and diluted earnings per share (“EPS”) were $2.02. While third quarter 2023 net income and EPS both decreased from the second quarter of 2023, revenue and pre-tax pre-provision income both improved.

Net income and diluted EPS for the nine months ended September 30, 2023 were $922 million and $6.49, which both increased 17% from the nine months ended September 30, 2022.

3

Tangible book value and the tangible common equity ratio are non-GAAP financial measures. See reconciliation of GAAP to non-GAAP measures in Table 13.

Third Quarter 2023 Compared to Second Quarter 2023

Net Interest Income and Net Interest Margin

Net interest income (“NII”) totaled $571 million in the third quarter, an increase of 1% from $567 million in the second quarter. Net interest margin (“NIM”) of 3.48% declined seven basis points from 3.55% in the second quarter.

  • The change in NIM was primarily driven by a higher cost of interest-bearing deposits and changes in the deposit mix in favor of higher-cost customer deposits, partially offset by lower wholesale deposit levels and higher loan volumes and yields.
  • The average loan yield was 6.51%, up 18 basis points from the second quarter. The average interest-earning asset yield was 5.87%, up 20 basis points from the second quarter.
  • The average cost of funds was 2.59%, up 28 basis points from the second quarter. The average cost of deposits was 2.43%, up 31 basis points from the second quarter.

Noninterest Income

Noninterest income totaled $77 million in the third quarter, a decrease of $2 million, or 2%, from $79 million in the second quarter.

  • Fee income4 of $67 million was down $2 million, or 3%, from $69 million in the second quarter.
  • Interest rate contracts and other derivative income of $11 million was up from $7 million in the second quarter. The change primarily reflected a favorable change in mark-to-market adjustments.
  • Other investment income of $2 million was down $2 million from $4 million in the second quarter, reflecting higher recognition of equity valuation marks for Community Reinvestment Act investments during the second quarter.

Noninterest Expense

Noninterest expense totaled $252 million in the third quarter, a decrease of 4% from $262 million in the second quarter. Third quarter noninterest expense consisted of $202 million of adjusted noninterest expense5, and $50 million in amortization expenses related to tax credit and other investments and core deposit intangibles.

  • Adjusted noninterest expense of $202 million decreased over $3 million, or 2%, from $205 million in the second quarter. This was driven by decreases in consulting expense, compensation and employee benefits, loan related expenses, and occupancy expense.
  • The efficiency ratio was 38.9% in the third quarter, compared with 40.6% in the second quarter and the adjusted efficiency ratio5 was 31.2% in the third quarter, compared with 31.8% in the second quarter.

TAX RELATED ITEMS

Third quarter 2023 income tax expense was $66 million, and the effective tax rate was 18.6%, compared with 12.7% for the second quarter of 2023. The lower effective tax rate in the second quarter was mainly due to a larger amount of tax credits in renewable energy investments that closed during the second quarter. The effective tax rate for the first nine months of 2023 was 18.6% compared with 22.7% for the first nine months of 2022. We currently estimate that the full year tax rate for 2023 will be between 19% - 20%.

4

Fee income includes lending, deposit account and wealth management fees, foreign exchange income, and interest rate contracts and other derivative income.

5

Adjusted noninterest expense and adjusted efficiency ratio are non-GAAP financial measures. See reconciliation of GAAP to non-GAAP measures in Table 12.

ASSET QUALITY

As of September 30, 2023, the credit quality of our loan portfolio remained solid.

  • The nonperforming assets ratio improved to 0.15% of total assets as of September 30, 2023, down from 0.17% of total assets as of June 30, 2023. Nonperforming assets decreased $12 million, or 10%, quarter-over-quarter to $104 million as of September 30, 2023, from $116 million as of June 30, 2023.
  • Third quarter 2023 net charge-offs were $18 million, or annualized 0.14% of average loans held-for-investment (“HFI”), compared with $8 million, or annualized 0.06% of average loans HFI, for the second quarter of 2023.
  • The criticized loans ratio increased 38 basis points quarter-over-quarter to 2.01% of loans HFI as of September 30, 2023, compared with 1.63% as of June 30, 2023. Criticized loans increased $210 million, or 26%, quarter-over-quarter to $1.0 billion as of September 30, 2023, compared with $812 million as of June 30, 2023. The special mention loans ratio increased 29 basis points quarter-over quarter to 0.95% of loans HFI as of September 30, 2023, compared with 0.66% as of June 30, 2023, and the classified loans ratio increased nine basis points to 1.06%.
  • The allowance for loan losses increased to $656 million, or 1.29% of loans HFI, as of September 30, 2023, compared with $635 million, or 1.28% of loans HFI, as of June 30, 2023.
  • Third quarter 2023 provision for credit losses was $42 million, compared with $26 million in the second quarter of 2023.

CAPITAL STRENGTH

Capital levels for East West remained strong as of September 30, 2023. All capital ratios expanded quarter-over-quarter and year-over-year. The following table presents the regulatory capital metrics as of September 30, 2023, June 30, 2023 and September 30, 2022.

EWBC Capital

 

 

($ in millions)

 

September 30, 2023 (a)

 

June 30, 2023 (a)

 

September 30, 2022 (a)

Risk-Weighted Assets (“RWA”) (b)

 

$52,944

 

$51,696

 

$49,266

Risk-based capital ratios:

 

 

 

 

 

 

CET1 capital ratio

 

13.30%

 

13.17%

 

12.27%

Tier 1 capital ratio

 

13.30%

 

13.17%

 

12.27%

Total capital ratio

 

14.74%

 

14.60%

 

13.57%

Leverage ratio

 

10.15%

 

10.03%

 

9.55%

Tangible common equity ratio (c)

 

9.03%

 

8.80%

 

8.35%

(a)

The Company has elected to use the 2020 Current Expected Credit Losses (CECL) transition provision in the calculation of its September 30, 2023, June 30, 2023 and September 30, 2022 regulatory capital ratios. The Company’s September 30, 2023 regulatory capital ratios and RWA are preliminary.

(b)

Under regulatory guidelines, on-balance sheet assets and credit equivalent amounts of derivatives and off-balance sheet items are assigned to one of several broad risk categories based on the nature of the obligor, or, if relevant, the guarantor or the nature of any collateral. The aggregate dollar value in each risk category is then multiplied by the risk weight associated with that category. The resulting weighted values from each of the risk categories are aggregated for determining total RWA.

(c)

Tangible common equity ratio is a non-GAAP financial measure. See reconciliation of GAAP to non-GAAP measures in Table 13.

DIVIDEND PAYOUT AND CAPITAL ACTIONS

East West’s Board of Directors has declared fourth quarter 2023 dividends for the Company’s common stock. The common stock cash dividend of $0.48 per share is payable on November 15, 2023, to stockholders of record on November 1, 2023.

On March 3, 2020, East West’s Board of Directors authorized the repurchase of up to $500 million of East West’s common stock, of which $254 million remains available. East West did not repurchase any shares during the third quarter of 2023. The Company intends to resume share repurchases in the fourth quarter of 2023.

Conference Call

East West will host a conference call to discuss third quarter 2023 earnings with the public on Thursday, October 19, 2023, at 8:30 a.m. PT/11:30 a.m. ET. The public and investment community are invited to listen as management discusses third quarter 2023 results and operating developments.

  • The following dial-in information is provided for participation in the conference call: calls within the U.S. – (877) 506-6399; calls within Canada – (855) 669-9657; international calls – (412) 902-6699.
  • A presentation to accompany the earnings call will be available on the Investor Relations page of the Company’s website at www.eastwestbank.com/investors.
  • A listen-only live broadcast of the call will also be available on the Investor Relations page of the Company’s website at www.eastwestbank.com/investors.
  • A replay of the conference call will be available on October 19, 2023, at 11:30 a.m. PT/2:30 p.m. ET through November 19, 2023. The replay numbers are: within the U.S. – (877) 344-7529; within Canada – (855) 669-9658; international calls – (412) 317-0088; and the replay access code is: 8920769.

About East West

East West provides financial services that help customers reach further and connect to new opportunities. East West Bancorp, Inc. is a public company (Nasdaq: “EWBC”) with total assets of $68.3 billion as of September 30, 2023. The Company’s wholly-owned subsidiary, East West Bank, is the largest independent bank headquartered in Southern California, and operates over 120 locations in the United States and Asia. The Bank’s markets in the United States include California, Georgia, Illinois, Massachusetts, Nevada, New York, Texas, and Washington. For more information on East West, visit www.eastwestbank.com.

Forward-Looking Statements

Certain matters set forth herein (including any exhibits hereto) contain forward-looking statements that are intended to be covered by the safe harbor provisions for such statements provided by the Private Securities Litigation Reform Act of 1995. In addition, the Company may make forward-looking statements in other documents that it files with, or furnishes to, the U.S. Securities and Exchange Commission (“SEC”) and management may make forward-looking statements to analysts, investors, media members and others. Forward-looking statements are those that do not relate to historical facts and that are based on current assumptions, beliefs, estimates, expectations and projections, many of which, by their nature, are inherently uncertain and beyond the Company’s control. Forward-looking statements may relate to various matters, including the Company’s financial condition, results of operations, plans, objectives, future performance, business or industry, and usually can be identified by the use of forward-looking words, such as “anticipates,” “assumes,” “believes,” “can,” “continues,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “likely,” “may,” “might,” “objective,” “plans,” “potential,” “projects,” “remains,” “should,” “target,” “trend,” “will,” “would,” or similar expressions or variations thereof, and the negative thereof, but these terms are not the exclusive means of identifying such statements. You should not place undue reliance on forward-looking statements, as they are subject to risks and uncertainties, including, but not limited to, those described below. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements the Company may make.

There are various important factors that could cause future results to differ materially from historical performance and any forward-looking statements. Factors that might cause such differences, include, but are not limited to: changes in the global economy, including an economic slowdown, capital or financial market disruption, supply chain disruption, level of inflation, interest rate environment, housing prices, employment levels, rate of growth and general business conditions, which could result in, among other things, reduced demand for loans, reduced availability of funding or increased funding costs, declines in asset values and/or recognition of allowance for credit losses; changes in local, regional and global business, economic and political conditions and geopolitical events, such as Russia’s invasion of Ukraine; the soundness of other financial institutions and the impacts related to or resulting from recent bank failures and other economic and industry volatility, including potential increased regulatory requirements, Federal Deposit Insurance Corporation (“FDIC”) insurance premiums and assessments, losses in the value of our investment portfolio, deposit withdrawals, or other adverse consequences of negative market perceptions of the banking industry or the Company; changes in laws or the regulatory environment, including regulatory reform initiatives and policies of the U.S. Department of the Treasury, the Board of Governors of the Federal Reserve System (“Federal Reserve”), the FDIC, the SEC, the Consumer Financial Protection Bureau (“CFPB”), the California Department of Financial Protection and Innovation — Division of Financial Institutions, China’s National Administration of Financial Regulation, the Hong Kong Monetary Authority, the Hong Kong Securities and Futures Commission, and the Monetary Authority of Singapore; changes and effects thereof in trade, monetary and fiscal policies and laws, including the ongoing trade, economic and political disputes between the U.S. and the People’s Republic of China and the monetary policies of the Federal Reserve; changes in the commercial and consumer real estate markets; changes in consumer or commercial spending, savings and borrowing habits, and patterns and behaviors; the impact from potential changes to income tax laws and regulations, federal spending and economic stimulus programs; the impact of any future U.S. federal government shutdown and uncertainty regarding the U.S. federal government’s debt limit and credit rating; the Company’s ability to compete effectively against financial institutions and other entities, including as a result of emerging technologies; the success and timing of the Company’s business strategies; the Company’s ability to retain key officers and employees; the impact on the Company’s funding costs, net interest income and net interest margin from changes in key variable market interest rates, competition, regulatory requirements and the Company’s product mix; changes in the Company’s costs of operation, compliance and expansion; the Company’s ability to adopt and successfully integrate new technologies into its business in a strategic manner; the impact of communications or technology disruption, failure in, or breach of, the Company’s operational or security systems or infrastructure, or those of third party vendors with which the Company does business, including as a result of cyber-attacks; and other similar matters which could result in, among other things, confidential and/or proprietary information being disclosed or misused, and materially impact the Company’s ability to provide services to its clients; the adequacy of the Company’s risk management framework, disclosure controls and procedures and internal control over financial reporting; future credit quality and performance, including the Company’s expectations regarding future credit losses and allowance levels; the impact of adverse changes to the Company’s credit ratings from major credit rating agencies; the impact of adverse judgments or settlements in litigation; the impact on the Company’s operations due to political developments, pandemics, wars, civil unrest, terrorism or other hostilities that may disrupt or increase volatility in securities or otherwise affect business and economic conditions; heightened regulatory and governmental oversight and scrutiny of the Company’s business practices, including dealings with consumers; the impact of reputational risk from negative publicity, fines, penalties and other negative consequences from regulatory violations, legal actions and the Company’s interactions with business partners, counterparties, service providers and other third parties; the impact of regulatory investigations and enforcement actions; changes in accounting standards as may be required by the Financial Accounting Standards Board (“FASB”) or other regulatory agencies and their impact on the Company’s critical accounting policies and assumptions; the Company’s capital requirements and its ability to generate capital internally or raise capital on favorable terms; the impact on the Company’s liquidity due to changes in the Company’s ability to receive dividends from its subsidiaries; any strategic acquisitions or divestitures; changes in the equity and debt securities markets; fluctuations in the Company’s stock price; fluctuations in foreign currency exchange rates; the impact of increased focus on social, environmental and sustainability matters, which may affect the Company’s operations as well as those of its customers and the economy more broadly; and the impact of climate change, natural or man-made disasters or calamities, such as wildfires, droughts, hurricanes, flooding and earthquakes or other events that may directly or indirectly result in a negative impact on the Company’s financial performance.

For a more detailed discussion of some of the factors that might cause such differences, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 under the heading Item 1A. Risk Factors and the information set forth under Item 1A. Risk Factors in the Company’s Quarterly Reports on Form 10-Q. You should treat forward-looking statements as speaking only as of the date they are made and based only on information then actually known to the Company. The Company does not undertake, and specifically disclaims any obligation to update or revise any forward-looking statements to reflect the occurrence of events or circumstances after the date of such statements except as required by law.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET

($ and shares in thousands, except per share data)

(unaudited)

Table 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2023

% or Basis Point Change

 

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

 

Qtr-o-Qtr

 

Yr-o-Yr

 

Assets

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

495,976

 

 

$

614,053

 

 

$

554,260

 

 

(19.2

)%

 

(10.5

)%

 

Interest-bearing cash with banks

 

 

4,065,202

 

 

 

5,763,834

 

 

 

1,609,093

 

 

(29.5

)

 

152.6

 

 

Cash and cash equivalents

 

 

4,561,178

 

 

 

6,377,887

 

 

 

2,163,353

 

 

(28.5

)

 

110.8

 

 

Interest-bearing deposits with banks

 

 

17,213

 

 

 

17,169

 

 

 

630,543

 

 

0.3

 

 

(97.3

)

 

Assets purchased under resale agreements (“resale agreements”)

 

 

785,000

 

 

 

635,000

 

 

 

892,986

 

 

23.6

 

 

(12.1

)

 

Available-for-sale (“AFS”) debt securities (amortized cost of $6,976,331, $6,820,569 and $6,771,354)

 

 

6,039,837

 

 

 

5,987,258

 

 

 

5,906,090

 

 

0.9

 

 

2.3

 

 

Held-to-maturity (“HTM”) debt securities, at amortized cost (fair value of $2,308,048, $2,440,484 and $2,459,135)

 

 

2,964,235

 

 

 

2,975,933

 

 

 

3,012,667

 

 

(0.4

)

 

(1.6

)

 

Loans held-for-sale (“HFS”)

 

 

4,762

 

 

 

2,830

 

 

 

14,500

 

 

68.3

 

 

(67.2

)

 

Loans held-for-investment (“HFI”) (net of allowance for loan losses of $655,523, $635,400 and $582,517)

 

 

50,251,661

 

 

 

49,192,964

 

 

 

46,859,738

 

 

2.2

 

 

7.2

 

 

Investments in qualified affordable housing partnerships, tax credit and other investments, net

 

 

901,559

 

 

 

815,471

 

 

 

725,254

 

 

10.6

 

 

24.3

 

 

Goodwill

 

 

465,697

 

 

 

465,697

 

 

 

465,697

 

 

 

 

 

 

Operating lease right-of-use assets

 

 

97,782

 

 

 

100,500

 

 

 

105,411

 

 

(2.7

)

 

(7.2

)

 

Other assets

 

 

2,200,534

 

 

 

1,961,972

 

 

 

1,799,822

 

 

12.2

 

 

22.3

 

 

Total assets

 

$

68,289,458

 

 

$

68,532,681

 

 

$

62,576,061

 

 

(0.4

)%

 

9.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

$

55,087,031

 

 

$

55,658,786

 

 

$

53,857,362

 

 

(1.0

)%

 

2.3

%

 

Short-term borrowings

 

 

4,500,000

 

 

 

4,500,000

 

 

 

 

 

 

 

100.0

 

 

Federal funds purchased

 

 

 

 

 

 

 

 

200,000

 

 

 

 

(100.0

)

 

FHLB advances

 

 

 

 

 

 

 

 

324,920

 

 

 

 

(100.0

)

 

Assets sold under repurchase agreements (“repurchase agreements”)

 

 

 

 

 

 

 

 

611,785

 

 

 

 

(100.0

)

 

Long-term debt and finance lease liabilities

 

 

153,087

 

 

 

152,951

 

 

 

152,610

 

 

0.1

 

 

0.3

 

 

Operating lease liabilities

 

 

107,695

 

 

 

110,383

 

 

 

113,477

 

 

(2.4

)

 

(5.1

)

 

Accrued expenses and other liabilities

 

 

1,844,939

 

 

 

1,648,864

 

 

 

1,655,239

 

 

11.9

 

 

11.5

 

 

Total liabilities

 

 

61,692,752

 

 

 

62,070,984

 

 

 

56,915,393

 

 

(0.6

)

 

8.4

 

 

Stockholders’ equity

 

 

6,596,706

 

 

 

6,461,697

 

 

 

5,660,668

 

 

2.1

 

 

16.5

 

 

Total liabilities and stockholders’ equity

 

$

68,289,458

 

 

$

68,532,681

 

 

$

62,576,061

 

 

(0.4

)%

 

9.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per share

 

$

46.62

 

 

$

45.67

 

 

$

40.17

 

 

2.1

%

 

16.1

%

 

Tangible book value (1) per share

 

$

43.29

 

 

$

42.33

 

 

$

36.80

 

 

2.3

 

 

17.6

 

 

Number of common shares at period-end

 

 

141,486

 

 

 

141,484

 

 

 

140,918

 

 

0.0

 

 

0.4

 

 

Total stockholders’ equity to assets ratio

 

 

9.66

%

 

 

9.43

%

 

 

9.05

%

 

23

 

bps

61

 

bps

Tangible common equity (“TCE”) ratio (1)

 

 

9.03

%

 

 

8.80

%

 

 

8.35

%

 

23

 

bps

68

 

bps

(1)

Tangible book value and the TCE ratio are non-GAAP financial measures. See reconciliation of GAAP to non-GAAP measures in Table 13.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

TOTAL LOANS AND DEPOSITS DETAIL

($ in thousands)

(unaudited)

Table 2

 

 

 

 

 

 

 

 

 

September 30, 2023

% Change

 

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

 

Qtr-o-Qtr

 

Yr-o-Yr

Loans:

 

 

 

 

 

 

 

 

 

 

Commercial:

 

 

 

 

 

 

 

 

 

 

Commercial and industrial (“C&I”)

 

$

15,864,042

 

 

$

15,670,084

 

 

$

15,625,072

 

 

1.2

%

 

1.5

%

Commercial real estate (“CRE”):

 

 

 

 

 

 

 

 

 

 

CRE

 

 

14,667,378

 

 

 

14,373,385

 

 

 

13,573,157

 

 

2.0

 

 

8.1

 

Multifamily residential

 

 

4,900,097

 

 

 

4,764,180

 

 

 

4,559,302

 

 

2.9

 

 

7.5

 

Construction and land

 

 

798,190

 

 

 

781,068

 

 

 

556,894

 

 

2.2

 

 

43.3

 

Total CRE

 

 

20,365,665

 

 

 

19,918,633

 

 

 

18,689,353

 

 

2.2

 

 

9.0

 

Consumer:

 

 

 

 

 

 

 

 

 

 

Residential mortgage:

 

 

 

 

 

 

 

 

 

 

Single-family residential

 

 

12,836,558

 

 

 

12,308,613

 

 

 

10,855,345

 

 

4.3

 

 

18.3

 

Home equity lines of credit (“HELOCs”)

 

 

1,776,665

 

 

 

1,862,928

 

 

 

2,184,924

 

 

(4.6

)

 

(18.7

)

Total residential mortgage

 

 

14,613,223

 

 

 

14,171,541

 

 

 

13,040,269

 

 

3.1

 

 

12.1

 

Other consumer

 

 

64,254

 

 

 

68,106

 

 

 

87,561

 

 

(5.7

)

 

(26.6

)

Total loans HFI (1)

 

 

50,907,184

 

 

 

49,828,364

 

 

 

47,442,255

 

 

2.2

 

 

7.3

 

Loans HFS

 

 

4,762

 

 

 

2,830

 

 

 

14,500

 

 

68.3

 

 

(67.2

)

Total loans (1)

 

 

50,911,946

 

 

 

49,831,194

 

 

 

47,456,755

 

 

2.2

 

 

7.3

 

Allowance for loan losses

 

 

(655,523

)

 

 

(635,400

)

 

 

(582,517

)

 

3.2

 

 

12.5

 

Net loans (1)

 

$

50,256,423

 

 

$

49,195,794

 

 

$

46,874,238

 

 

2.2

 

 

7.2

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

$

16,169,072

 

 

$

16,741,099

 

 

$

21,645,394

 

 

(3.4

)%

 

(25.3

)%

Interest-bearing checking

 

 

7,689,289

 

 

 

8,348,587

 

 

 

6,822,343

 

 

(7.9

)

 

12.7

 

Money market

 

 

12,613,827

 

 

 

11,486,473

 

 

 

12,113,292

 

 

9.8

 

 

4.1

 

Savings

 

 

1,963,766

 

 

 

2,102,850

 

 

 

2,917,770

 

 

(6.6

)

 

(32.7

)

Time deposits

 

 

16,651,077

 

 

 

16,979,777

 

 

 

10,358,563

 

 

(1.9

)

 

60.7

 

Total deposits

 

$

55,087,031

 

 

$

55,658,786

 

 

$

53,857,362

 

 

(1.0

)%

 

2.3

%

(1)

Includes $(72.0) million, $(74.0) million and $(60.3) million of net deferred loan fees and net unamortized premiums as of September 30, 2023, June 30, 2023 and September 30, 2022, respectively.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF INCOME

($ and shares in thousands, except per share data)

(unaudited)

Table 3

 

 

 

Three Months Ended

 

September 30, 2023

% Change

 

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

 

Qtr-o-Qtr

 

Yr-o-Yr

Interest and dividend income

 

$

961,787

 

 

$

906,134

 

 

$

628,236

 

 

6.1%

 

53.1%

Interest expense

 

 

390,974

 

 

 

339,388

 

 

 

76,427

 

 

15.2

 

411.6

Net interest income before provision for credit losses

 

 

570,813

 

 

 

566,746

 

 

 

551,809

 

 

0.7

 

3.4

Provision for credit losses

 

 

42,000

 

 

 

26,000

 

 

 

27,000

 

 

61.5

 

55.6

Net interest income after provision for credit losses

 

 

528,813

 

 

 

540,746

 

 

 

524,809

 

 

(2.2)

 

0.8

Noninterest income

 

 

76,752

 

 

 

78,631

 

 

 

75,552

 

 

(2.4)

 

1.6

Noninterest expense

 

 

252,014

 

 

 

261,789

 

 

 

215,973

 

 

(3.7)

 

16.7

Income before income taxes

 

 

353,551

 

 

 

357,588

 

 

 

384,388

 

 

(1.1)

 

(8.0)

Income tax expense

 

 

65,813

 

 

 

45,557

 

 

 

89,049

 

 

44.5

 

(26.1)

Net income

 

$

287,738

 

 

$

312,031

 

 

$

295,339

 

 

(7.8)%

 

(2.6)%

Earnings per share (“EPS”)

 

 

 

 

 

 

 

 

 

 

- Basic

 

$

2.03

 

 

$

2.21

 

 

$

2.10

 

 

(7.8)%

 

(3.0)%

- Diluted

 

$

2.02

 

 

$

2.20

 

 

$

2.08

 

 

(7.9)

 

(2.6)

Weighted-average number of shares outstanding

 

 

 

 

 

 

 

 

 

 

- Basic

 

 

141,485

 

 

 

141,468

 

 

 

140,917

 

 

0.0%

 

0.4%

- Diluted

 

 

142,122

 

 

 

141,876

 

 

 

142,011

 

 

0.2

 

0.1

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

September 30, 2023

% Change

 

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

 

Qtr-o-Qtr

 

Yr-o-Yr

Noninterest income:

 

 

 

 

 

 

 

 

 

 

Lending fees

 

$

20,312

 

 

$

20,901

 

 

$

20,289

 

 

(2.8)%

 

0.1%

Deposit account fees

 

 

22,622

 

 

 

22,285

 

 

 

23,636

 

 

1.5

 

(4.3)

Interest rate contracts and other derivative income

 

 

11,208

 

 

 

7,373

 

 

 

8,761

 

 

52.0

 

27.9

Foreign exchange income

 

 

12,334

 

 

 

13,251

 

 

 

10,083

 

 

(6.9)

 

22.3

Wealth management fees

 

 

5,877

 

 

 

6,889

 

 

 

8,903

 

 

(14.7)

 

(34.0)

Net (losses) gains on sales of loans

 

 

(12

)

 

 

(7

)

 

 

2,129

 

 

71.4

 

NM

Other investment income (losses)

 

 

1,751

 

 

 

4,003

 

 

 

(580

)

 

(56.3)

 

NM

Other income

 

 

2,660

 

 

 

3,936

 

 

 

2,331

 

 

(32.4)

 

14.1

Total noninterest income

 

$

76,752

 

 

$

78,631

 

 

$

75,552

 

 

(2.4)%

 

1.6%

Noninterest expense:

 

 

 

 

 

 

 

 

 

 

Compensation and employee benefits

 

$

123,153

 

 

$

124,937

 

 

$

127,580

 

 

(1.4)%

 

(3.5)%

Occupancy and equipment expense

 

 

15,353

 

 

 

16,088

 

 

 

15,920

 

 

(4.6)

 

(3.6)

Deposit insurance premiums and regulatory assessments

 

 

8,583

 

 

 

8,262

 

 

 

4,875

 

 

3.9

 

76.1

Deposit account expense

 

 

11,585

 

 

 

10,559

 

 

 

6,707

 

 

9.7

 

72.7

Data processing

 

 

3,645

 

 

 

3,213

 

 

 

3,725

 

 

13.4

 

(2.1)

Computer software expense

 

 

8,116

 

 

 

7,479

 

 

 

6,889

 

 

8.5

 

17.8

Other operating expense

 

 

31,885

 

 

 

35,337

 

 

 

30,403

 

 

(9.8)

 

4.9

Amortization of tax credit and other investments

 

 

49,694

 

 

 

55,914

 

 

 

19,874

 

 

(11.1)

 

150.0

Total noninterest expense

 

$

252,014

 

 

$

261,789

 

 

$

215,973

 

 

(3.7)%

 

16.7%

 

NM - Not meaningful.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF INCOME

($ and shares in thousands, except per share data)

(unaudited)

Table 4

 

 

 

Nine Months Ended

 

September 30, 2023

% Change

 

 

September 30, 2023

 

September 30, 2022

 

Yr-o-Yr

Interest and dividend income

 

$

2,703,427

 

 

$

1,560,019

 

73.3%

Interest expense

 

 

966,007

 

 

 

119,645

 

NM

Net interest income before provision for credit losses

 

 

1,737,420

 

 

 

1,440,374

 

20.6

Provision for credit losses

 

 

88,000

 

 

 

48,500

 

81.4

Net interest income after provision for credit losses

 

 

1,649,420

 

 

 

1,391,874

 

18.5

Noninterest income

 

 

215,361

 

 

 

233,739

 

(7.9)

Noninterest expense

 

 

732,250

 

 

 

602,283

 

21.6

Income before income taxes

 

 

1,132,531

 

 

 

1,023,330

 

10.7

Income tax expense

 

 

210,323

 

 

 

232,010

 

(9.3)

Net income

 

$

922,208

 

 

$

791,320

 

16.5%

EPS

 

 

 

 

 

 

- Basic

 

$

6.52

 

 

$

5.59

 

16.6%

- Diluted

 

$

6.49

 

 

$

5.55

 

17.0

Weighted-average number of shares outstanding

 

 

 

 

 

 

- Basic

 

 

141,356

 

 

 

141,453

 

(0.1)%

- Diluted

 

 

142,044

 

 

 

142,601

 

(0.4)

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

September 30, 2023

% Change

 

 

September 30, 2023

 

September 30, 2022

 

Yr-o-Yr

Noninterest income:

 

 

 

 

 

 

Lending fees

 

$

61,799

 

 

$

59,869

 

3.2%

Deposit account fees

 

 

66,610

 

 

 

66,323

 

0.4

Interest rate contracts and other derivative income

 

 

21,145

 

 

 

29,695

 

(28.8)

Foreign exchange income

 

 

38,245

 

 

 

34,143

 

12.0

Wealth management fees

 

 

19,070

 

 

 

21,494

 

(11.3)

Net (losses) gains on sales of loans

 

 

(41

)

 

 

5,968

 

NM

Net (losses) gains on AFS debt securities

 

 

(10,000

)

 

 

1,306

 

NM

Other investment income

 

 

7,675

 

 

 

5,910

 

29.9

Other income

 

 

10,858

 

 

 

9,031

 

20.2

Total noninterest income

 

$

215,361

 

 

$

233,739

 

(7.9)%

Noninterest expense:

 

 

 

 

 

 

Compensation and employee benefits

 

$

377,744

 

 

$

357,213

 

5.7%

Occupancy and equipment expense

 

 

47,028

 

 

 

46,853

 

0.4

Deposit insurance premiums and regulatory assessments

 

 

24,755

 

 

 

14,519

 

70.5

Deposit account expense

 

 

31,753

 

 

 

17,071

 

86.0

Data processing

 

 

10,205

 

 

 

10,876

 

(6.2)

Computer software expense

 

 

22,955

 

 

 

20,755

 

10.6

Other operating expense (1)

 

 

102,092

 

 

 

86,243

 

18.4

Amortization of tax credit and other investments

 

 

115,718

 

 

 

48,753

 

137.4

Total noninterest expense

 

$

732,250

 

 

$

602,283

 

21.6%

NM - Not meaningful.
(1)

Includes $3.9 million of repurchase agreements’ extinguishment cost for the nine months ended September 30, 2023.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

SELECTED AVERAGE BALANCES

($ in thousands)

(unaudited)

Table 5

 

 

 

 

 

 

 

 

 

Three Months Ended

 

September 30, 2023

% Change

 

Nine Months Ended

 

September 30, 2023

% Change

 

 

September 30,

2023

 

June 30,

2023

 

September 30,

2022

 

Qtr-o-Qtr

 

Yr-o-Yr

 

September 30,

2023

 

September 30,

2022

 

Yr-o-Yr

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

C&I

 

$

15,400,172

 

$

15,244,826

 

$

15,282,661

 

1.0%

 

0.8%

 

$

15,348,662

 

$

14,850,849

 

3.4%

CRE:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CRE

 

 

14,453,014

 

 

14,130,811

 

 

13,533,482

 

2.3

 

6.8

 

 

14,174,100

 

 

12,958,562

 

9.4

Multifamily residential

 

 

4,798,360

 

 

4,685,786

 

 

4,531,351

 

2.4

 

5.9

 

 

4,695,473

 

 

4,133,975

 

13.6

Construction and land

 

 

807,906

 

 

782,541

 

 

532,800

 

3.2

 

51.6

 

 

755,651

 

 

467,731

 

61.6

Total CRE

 

 

20,059,280

 

 

19,599,138

 

 

18,597,633

 

2.3

 

7.9

 

 

19,625,224

 

 

17,560,268

 

11.8

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Single-family residential

 

 

12,548,593

 

 

12,014,513

 

 

10,676,022

 

4.4

 

17.5

 

 

11,997,671

 

 

9,809,549

 

22.3

HELOCs

 

 

1,816,900

 

 

1,928,208

 

 

2,216,355

 

(5.8)

 

(18.0)

 

 

1,931,105

 

 

2,230,060

 

(13.4)

Total residential mortgage

 

 

14,365,493

 

 

13,942,721

 

 

12,892,377

 

3.0

 

11.4

 

 

13,928,776

 

 

12,039,609

 

15.7

Other consumer

 

 

63,917

 

 

65,035

 

 

81,870

 

(1.7)

 

(21.9)

 

 

67,181

 

 

97,794

 

(31.3)

Total loans (1)

 

$

49,888,862

 

$

48,851,720

 

$

46,854,541

 

2.1%

 

6.5%

 

$

48,969,843

 

$

44,548,520

 

9.9%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets

 

$

65,051,461

 

$

64,061,569

 

$

59,478,689

 

1.5%

 

9.4%

 

$

63,545,257

 

$

58,949,457

 

7.8%

Total assets

 

$

68,936,786

 

$

67,497,367

 

$

63,079,444

 

2.1%

 

9.3%

 

$

67,196,590

 

$

62,361,618

 

7.8%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing demand

 

$

16,302,296

 

$

16,926,937

 

$

22,423,633

 

(3.7)%

 

(27.3)%

 

$

17,633,922

 

$

23,244,247

 

(24.1)%

Interest-bearing checking

 

 

8,080,025

 

 

8,434,655

 

 

6,879,632

 

(4.2)

 

17.4

 

 

7,675,325

 

 

6,747,711

 

13.7

Money market

 

 

12,180,806

 

 

10,433,839

 

 

12,351,571

 

16.7

 

(1.4)

 

 

11,295,157

 

 

12,526,222

 

(9.8)

Savings

 

 

2,013,246

 

 

2,200,124

 

 

2,961,634

 

(8.5)

 

(32.0)

 

 

2,215,102

 

 

2,954,098

 

(25.0)

Time deposits

 

 

16,621,683

 

 

16,289,320

 

 

9,435,063

 

2.0

 

76.2

 

 

15,993,669

 

 

8,596,728

 

86.0

Total deposits

 

$

55,198,056

 

$

54,284,875

 

$

54,051,533

 

1.7%

 

2.1%

 

$

54,813,175

 

$

54,069,006

 

1.4%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities

 

$

43,563,947

 

$

42,026,844

 

$

32,703,323

 

3.7%

 

33.2%

 

$

40,826,548

 

$

31,631,865

 

29.1%

Stockholders’ equity

 

$

6,604,798

 

$

6,440,996

 

$

5,772,638

 

2.5%

 

14.4%

 

$

6,411,250

 

$

5,765,637

 

11.2%

(1)

Includes loans HFS.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

QUARTER-TO-DATE AVERAGE BALANCES, YIELDS AND RATES

($ in thousands)

(unaudited)

Table 6

 

 

 

Three Months Ended

 

 

September 30, 2023

 

June 30, 2023

 

 

Average

 

 

 

Average

 

Average

 

 

 

Average

 

 

Balance

 

Interest

 

Yield/Rate (1)

 

Balance

 

Interest

 

Yield/Rate (1)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing cash and deposits with banks

 

$

5,392,795

 

 

$

67,751

 

4.98

%

 

$

5,247,755

 

 

$

60,995

 

4.66

%

Resale agreements

 

 

648,587

 

 

 

4,460

 

2.73

%

 

 

641,939

 

 

 

3,969

 

2.48

%

AFS debt securities

 

 

6,074,119

 

 

 

57,177

 

3.73

%

 

 

6,257,397

 

 

 

56,292

 

3.61

%

HTM debt securities

 

 

2,967,703

 

 

 

12,601

 

1.68

%

 

 

2,983,780

 

 

 

12,678

 

1.70

%

Loans (2)

 

 

49,888,862

 

 

 

818,719

 

6.51

%

 

 

48,851,720

 

 

 

771,264

 

6.33

%

FHLB and FRB stock

 

 

79,395

 

 

 

1,079

 

5.39

%

 

 

78,978

 

 

 

936

 

4.75

%

Total interest-earning assets

 

$

65,051,461

 

 

$

961,787

 

5.87

%

 

$

64,061,569

 

 

$

906,134

 

5.67

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

 

544,939

 

 

 

 

 

 

 

569,227

 

 

 

 

 

Allowance for loan losses

 

 

(629,229

)

 

 

 

 

 

 

(619,868

)

 

 

 

 

Other assets

 

 

3,969,615

 

 

 

 

 

 

 

3,486,439

 

 

 

 

 

Total assets

 

$

68,936,786

 

 

 

 

 

 

$

67,497,367

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Checking deposits

 

$

8,080,025

 

 

$

54,285

 

2.67

%

 

$

8,434,655

 

 

$

49,571

 

2.36

%

Money market deposits

 

 

12,180,806

 

 

 

113,217

 

3.69

%

 

 

10,433,839

 

 

 

86,419

 

3.32

%

Savings deposits

 

 

2,013,246

 

 

 

4,047

 

0.80

%

 

 

2,200,124

 

 

 

3,963

 

0.72

%

Time deposits

 

 

16,621,683

 

 

 

166,747

 

3.98

%

 

 

16,289,320

 

 

 

147,524

 

3.63

%

Federal funds purchased and other short-term borrowings

 

 

4,501,327

 

 

 

49,575

 

4.37

%

 

 

4,500,566

 

 

 

49,032

 

4.37

%

FHLB advances

 

 

1

 

 

 

 

%

 

 

1

 

 

 

 

%

Repurchase agreements

 

 

13,897

 

 

 

193

 

5.51

%

 

 

15,579

 

 

 

211

 

5.43

%

Long-term debt and finance lease liabilities

 

 

152,962

 

 

 

2,910

 

7.55

%

 

 

152,760

 

 

 

2,668

 

7.01

%

Total interest-bearing liabilities

 

$

43,563,947

 

 

$

390,974

 

3.56

%

 

$

42,026,844

 

 

$

339,388

 

3.24

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing liabilities and stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

16,302,296

 

 

 

 

 

 

 

16,926,937

 

 

 

 

 

Accrued expenses and other liabilities

 

 

2,465,745

 

 

 

 

 

 

 

2,102,590

 

 

 

 

 

Stockholders’ equity

 

 

6,604,798

 

 

 

 

 

 

 

6,440,996

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

68,936,786

 

 

 

 

 

 

$

67,497,367

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate spread

 

 

 

 

 

2.31

%

 

 

 

 

 

2.43

%

Net interest income and net interest margin

 

 

 

$

570,813

 

3.48

%

 

 

 

$

566,746

 

3.55

%

(1)

Annualized.

(2)

Includes loans HFS.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

QUARTER-TO-DATE AVERAGE BALANCES, YIELDS AND RATES

($ in thousands)

(unaudited)

Table 7

 

 

 

Three Months Ended

 

September 30, 2023

 

September 30, 2022

 

Average

 

 

 

Average

 

Average

 

 

 

Average

 

Balance

 

Interest

 

Yield/Rate (1)

 

Balance

 

Interest

 

Yield/Rate (1)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing cash and deposits with banks

 

$

5,392,795

 

 

$

67,751

 

4.98

%

 

$

2,287,010

 

 

$

9,080

 

1.58

%

Resale agreements

 

 

648,587

 

 

 

4,460

 

2.73

%

 

 

1,037,292

 

 

 

6,769

 

2.59

%

AFS debt securities

 

 

6,074,119

 

 

 

57,177

 

3.73

%

 

 

6,204,729

 

 

 

38,383

 

2.45

%

HTM debt securities

 

 

2,967,703

 

 

 

12,601

 

1.68

%

 

 

3,017,063

 

 

 

12,709

 

1.67

%

Loans (2)

 

 

49,888,862

 

 

 

818,719

 

6.51

%

 

 

46,854,541

 

 

 

560,452

 

4.75

%

FHLB and FRB stock

 

 

79,395

 

 

 

1,079

 

5.39

%

 

 

78,054

 

 

 

843

 

4.28

%

Total interest-earning assets

 

$

65,051,461

 

 

$

961,787

 

5.87

%

 

$

59,478,689

 

 

$

628,236

 

4.19

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

 

544,939

 

 

 

 

 

 

 

615,836

 

 

 

 

 

Allowance for loan losses

 

 

(629,229

)

 

 

 

 

 

 

(566,369

)

 

 

 

 

Other assets

 

 

3,969,615

 

 

 

 

 

 

 

3,551,288

 

 

 

 

 

Total assets

 

$

68,936,786

 

 

 

 

 

 

$

63,079,444

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Checking deposits

 

$

8,080,025

 

 

$

54,285

 

2.67

%

 

$

6,879,632

 

 

$

8,493

 

0.49

%

Money market deposits

 

 

12,180,806

 

 

 

113,217

 

3.69

%

 

 

12,351,571

 

 

 

33,101

 

1.06

%

Savings deposits

 

 

2,013,246

 

 

 

4,047

 

0.80

%

 

 

2,961,634

 

 

 

2,268

 

0.30

%

Time deposits

 

 

16,621,683

 

 

 

166,747

 

3.98

%

 

 

9,435,063

 

 

 

25,032

 

1.05

%

Federal funds purchased and other short-term borrowings

 

 

4,501,327

 

 

 

49,575

 

4.37

%

 

 

211,794

 

 

 

1,177

 

2.20

%

FHLB advances

 

 

1

 

 

 

 

%

 

 

86,243

 

 

 

392

 

1.80

%

Repurchase agreements

 

 

13,897

 

 

 

193

 

5.51

%

 

 

624,821

 

 

 

4,421

 

2.81

%

Long-term debt and finance lease liabilities

 

 

152,962

 

 

 

2,910

 

7.55

%

 

 

152,565

 

 

 

1,543

 

4.01

%

Total interest-bearing liabilities

 

$

43,563,947

 

 

$

390,974

 

3.56

%

 

$

32,703,323

 

 

$

76,427

 

0.93

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing liabilities and stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

16,302,296

 

 

 

 

 

 

 

22,423,633

 

 

 

 

 

Accrued expenses and other liabilities

 

 

2,465,745

 

 

 

 

 

 

 

2,179,850

 

 

 

 

 

Stockholders’ equity

 

 

6,604,798

 

 

 

 

 

 

 

5,772,638

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

68,936,786

 

 

 

 

 

 

$

63,079,444

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate spread

 

 

 

 

 

2.31

%

 

 

 

 

 

3.26

%

Net interest income and net interest margin

 

 

 

$

570,813

 

3.48

%

 

 

 

$

551,809

 

3.68

%

(1)

Annualized.

(2)

Includes loans HFS.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

YEAR-TO-DATE AVERAGE BALANCES, YIELDS AND RATES

($ in thousands)

(unaudited)

Table 8

 

 

Nine Months Ended

September 30, 2023

 

September 30, 2022

Average

 

 

 

Average

 

Average

 

 

 

Average

Balance

 

Interest

 

Yield/Rate (1)

 

Balance

 

Interest

 

Yield/Rate (1)

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing cash and deposits with banks

 

$

4,703,843

 

 

$

164,393

 

4.67

%

 

$

3,175,596

 

 

$

17,127

 

0.72

%

Resale agreements

 

 

659,621

 

 

 

12,932

 

2.62

%

 

 

1,588,452

 

 

 

23,705

 

2.00

%

AFS debt securities

 

 

6,146,653

 

 

 

166,666

 

3.63

%

 

 

6,886,268

 

 

 

106,290

 

2.06

%

HTM debt securities

 

 

2,982,284

 

 

 

38,013

 

1.70

%

 

 

2,672,797

 

 

 

33,645

 

1.68

%

Loans (2)

 

 

48,969,843

 

 

 

2,318,369

 

6.33

%

 

 

44,548,520

 

 

 

1,376,978

 

4.13

%

FHLB and FRB stock

 

 

83,013

 

 

 

3,054

 

4.92

%

 

 

77,824

 

 

 

2,274

 

3.91

%

Total interest-earning assets

 

$

63,545,257

 

 

$

2,703,427

 

5.69

%

 

$

58,949,457

 

 

$

1,560,019

 

3.54

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

 

578,144

 

 

 

 

 

 

 

656,772

 

 

 

 

 

Allowance for loan losses

 

 

(617,381

)

 

 

 

 

 

 

(551,818

)

 

 

 

 

Other assets

 

 

3,690,570

 

 

 

 

 

 

 

3,307,207

 

 

 

 

 

Total assets

 

$

67,196,590

 

 

 

 

 

 

$

62,361,618

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Checking deposits

 

$

7,675,325

 

 

$

127,030

 

2.21

%

 

$

6,747,711

 

 

$

13,073

 

0.26

%

Money market deposits

 

 

11,295,157

 

 

 

275,738

 

3.26

%

 

 

12,526,222

 

 

 

45,196

 

0.48

%

Savings deposits

 

 

2,215,102

 

 

 

11,679

 

0.70

%

 

 

2,954,098

 

 

 

5,836

 

0.26

%

Time deposits

 

 

15,993,669

 

 

 

428,120

 

3.58

%

 

 

8,596,728

 

 

 

40,266

 

0.63

%

Federal funds purchased and other short-term borrowings

 

 

3,284,663

 

 

 

107,432

 

4.37

%

 

 

93,370

 

 

 

1,427

 

2.04

%

FHLB advances

 

 

164,836

 

 

 

6,430

 

5.22

%

 

 

128,137

 

 

 

1,529

 

1.60

%

Repurchase agreements

 

 

45,080

 

 

 

1,456

 

4.32

%

 

 

433,340

 

 

 

8,855

 

2.73

%

Long-term debt and finance lease liabilities

 

 

152,716

 

 

 

8,122

 

7.11

%

 

 

152,259

 

 

 

3,463

 

3.04

%

Total interest-bearing liabilities

 

$

40,826,548

 

 

$

966,007

 

3.16

%

 

$

31,631,865

 

 

$

119,645

 

0.51

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing liabilities and stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

17,633,922

 

 

 

 

 

 

 

23,244,247

 

 

 

 

 

Accrued expenses and other liabilities

 

 

2,324,870

 

 

 

 

 

 

 

1,719,869

 

 

 

 

 

Stockholders’ equity

 

 

6,411,250

 

 

 

 

 

 

 

5,765,637

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

67,196,590

 

 

 

 

 

 

$

62,361,618

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate spread

 

 

 

 

 

2.53

%

 

 

 

 

 

3.03

%

Net interest income and net interest margin

 

 

 

$

1,737,420

 

3.66

%

 

 

 

$

1,440,374

 

3.27

%

(1)

Annualized.

(2)

Includes loans HFS.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

SELECTED RATIOS

(unaudited)

Table 9

 

 

 

Three Months Ended (1)

 

September 30, 2023

Basis Point Change

 

 

September 30,

2023

 

June 30,

2023

 

September 30,

2022

 

Qtr-o-Qtr

 

Yr-o-Yr

 

Return on average assets

 

1.66

%

 

1.85

%

 

1.86

%

 

(19

)

bps

(20

)

bps

Adjusted return on average assets (2)

 

1.66

%

 

1.85

%

 

1.86

%

 

(19

)

 

(20

)

 

Return on average common equity

 

17.28

%

 

19.43

%

 

20.30

%

 

(215

)

 

(302

)

 

Adjusted return on average common equity (2)

 

17.28

%

 

19.43

%

 

20.30

%

 

(215

)

 

(302

)

 

Return on average TCE (3)

 

18.65

%

 

21.01

%

 

22.16

%

 

(236

)

 

(351

)

 

Adjusted return on average TCE (3)

 

18.65

%

 

21.01

%

 

22.16

%

 

(236

)

 

(351

)

 

Interest rate spread

 

2.31

%

 

2.43

%

 

3.26

%

 

(12

)

 

(95

)

 

Net interest margin

 

3.48

%

 

3.55

%

 

3.68

%

 

(7

)

 

(20

)

 

Average loan yield

 

6.51

%

 

6.33

%

 

4.75

%

 

18

 

 

176

 

 

Yield on average interest-earning assets

 

5.87

%

 

5.67

%

 

4.19

%

 

20

 

 

168

 

 

Average cost of interest-bearing deposits

 

3.45

%

 

3.09

%

 

0.86

%

 

36

 

 

259

 

 

Average cost of deposits

 

2.43

%

 

2.12

%

 

0.51

%

 

31

 

 

192

 

 

Average cost of funds

 

2.59

%

 

2.31

%

 

0.55

%

 

28

 

 

204

 

 

Pre-tax, pre-provision profitability ratio (4)

 

2.56

%

 

2.61

%

 

2.72

%

 

(5

)

 

(16

)

 

Adjusted noninterest expense/average assets (4)

 

1.16

%

 

1.22

%

 

1.23

%

 

(6

)

 

(7

)

 

Efficiency ratio

 

38.92

%

 

40.56

%

 

34.43

%

 

(164

)

 

449

 

 

Adjusted efficiency ratio (4)

 

31.18

%

 

31.83

%

 

31.18

%

 

(65

)

bps

 

bps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended (1)

 

September 30, 2023

Basis Point Change

 

 

 

 

 

 

September 30,

2023

 

September 30,

2022

 

Yr-o-Yr

 

 

 

 

 

Return on average assets

 

1.83

%

 

1.70

%

 

13

 

bps

 

 

 

Adjusted return on average assets (2)

 

1.85

%

 

1.70

%

 

15

 

 

 

 

 

 

Return on average common equity

 

19.23

%

 

18.35

%

 

88

 

 

 

 

 

 

Adjusted return on average common equity (2)

 

19.38

%

 

18.35

%

 

103

 

 

 

 

 

 

Return on average TCE (3)

 

20.80

%

 

20.04

%

 

76

 

 

 

 

 

 

Adjusted return on average TCE (3)

 

20.96

%

 

20.04

%

 

92

 

 

 

 

 

 

Interest rate spread

 

2.53

%

 

3.03

%

 

(50

)

 

 

 

 

 

Net interest margin

 

3.66

%

 

3.27

%

 

39

 

 

 

 

 

 

Average loan yield

 

6.33

%

 

4.13

%

 

220

 

 

 

 

 

 

Yield on average interest-earning assets

 

5.69

%

 

3.54

%

 

215

 

 

 

 

 

 

Average cost of interest-bearing deposits

 

3.03

%

 

0.45

%

 

258

 

 

 

 

 

 

Average cost of deposits

 

2.06

%

 

0.26

%

 

180

 

 

 

 

 

 

Average cost of funds

 

2.21

%

 

0.29

%

 

192

 

 

 

 

 

 

Pre-tax, pre-provision profitability ratio (4)

 

2.69

%

 

2.41

%

 

28

 

 

 

 

 

 

Adjusted noninterest expense/average assets (4)

 

1.22

%

 

1.18

%

 

4

 

 

 

 

 

 

Efficiency ratio

 

37.50

%

 

35.98

%

 

152

 

 

 

 

 

 

Adjusted efficiency ratio (4)

 

31.15

%

 

32.98

%

 

(183

)

bps

 

 

 

 

(1)

 

Annualized except for efficiency ratio and adjusted efficiency ratio.

(2)

 

Adjusted return on average assets and adjusted return on average common equity are non-GAAP financial measures. See reconciliation of GAAP to non-GAAP measures in Table 14.

(3)

 

Return on average TCE and adjusted return on average TCE are non-GAAP financial measures. See reconciliation of GAAP to non-GAAP measures in Table 13.

(4)

 

Pre-tax, pre-provision profitability ratio, adjusted noninterest expense/average assets and adjusted efficiency ratio are non-GAAP financial measures. See reconciliation of GAAP to non-GAAP measures in Table 12.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

ALLOWANCE FOR LOAN LOSSES & OFF-BALANCE SHEET CREDIT EXPOSURES

($ in thousands)

(unaudited)

Table 10

 

 

 

 

Three Months Ended September 30, 2023

 

 

 

Commercial

 

Consumer

 

 

 

 

 

C&I

 

Total CRE

 

Total Residential

Mortgage

 

Other Consumer

 

Total

Allowance for loan losses, June 30, 2023

 

 

$

375,333

 

 

$

202,768

 

 

$

56,039

 

 

$

1,260

 

 

$

635,400

 

Provision for credit losses on loans

(a)

 

 

13,006

 

 

 

22,026

 

 

 

2,648

 

 

 

456

 

 

 

38,136

 

Gross charge-offs

 

 

 

(7,074

)

 

 

(13,879

)

 

 

(41

)

 

 

(13

)

 

 

(21,007

)

Gross recoveries

 

 

 

2,279

 

 

 

503

 

 

 

79

 

 

 

 

 

 

2,861

 

Total net (charge-offs) recoveries

 

 

 

(4,795

)

 

 

(13,376

)

 

 

38

 

 

 

(13

)

 

 

(18,146

)

Foreign currency translation adjustment

 

 

 

133

 

 

 

 

 

 

 

 

 

 

 

 

133

 

Allowance for loan losses, September 30, 2023

 

 

$

383,677

 

 

$

211,418

 

 

$

58,725

 

 

$

1,703

 

 

$

655,523

 

 

 

 

Three Months Ended June 30, 2023

 

 

 

Commercial

 

Consumer

 

 

 

 

 

C&I

 

Total CRE

 

Total Residential

Mortgage

 

Other Consumer

 

Total

Allowance for loan losses, March 31, 2023

 

 

$

376,325

 

 

$

188,915

 

 

$

52,978

 

 

$

1,675

 

 

$

619,893

 

Provision for (reversal of) credit losses on loans

(a)

 

 

5,259

 

 

 

16,076

 

 

 

3,057

 

 

 

(367

)

 

 

24,025

 

Gross charge-offs

 

 

 

(7,335

)

 

 

(2,366

)

 

 

(6

)

 

 

(48

)

 

 

(9,755

)

Gross recoveries

 

 

 

2,065

 

 

 

143

 

 

 

10

 

 

 

 

 

 

2,218

 

Total net (charge-offs) recoveries

 

 

 

(5,270

)

 

 

(2,223

)

 

 

4

 

 

 

(48

)

 

 

(7,537

)

Foreign currency translation adjustment

 

 

 

(981

)

 

 

 

 

 

 

 

 

 

 

 

(981

)

Allowance for loan losses, June 30, 2023

 

 

$

375,333

 

 

$

202,768

 

 

$

56,039

 

 

$

1,260

 

 

$

635,400

 

 

 

 

Three Months Ended September 30, 2022

 

 

 

Commercial

 

Consumer

 

 

 

 

 

C&I

 

Total CRE

 

Total Residential

Mortgage

 

Other Consumer

 

Total

Allowance for loan losses, June 30, 2022

 

 

$

363,282

 

 

$

173,479

 

 

$

25,060

 

 

$

1,449

 

 

$

563,270

 

Provision for credit losses on loans

(a)

 

 

9,575

 

 

 

11,163

 

 

 

6,281

 

 

 

255

 

 

 

27,274

 

Gross charge-offs

 

 

 

(6,894

)

 

 

(6,226

)

 

 

(775

)

 

 

(10

)

 

 

(13,905

)

Gross recoveries

 

 

 

7,172

 

 

 

71

 

 

 

21

 

 

 

 

 

 

7,264

 

Total net recoveries (charge-offs)

 

 

 

278

 

 

 

(6,155

)

 

 

(754

)

 

 

(10

)

 

 

(6,641

)

Foreign currency translation adjustment

 

 

 

(1,386

)

 

 

 

 

 

 

 

 

 

 

 

(1,386

)

Allowance for loan losses, September 30, 2022

 

 

$

371,749

 

 

$

178,487

 

 

$

30,587

 

 

$

1,694

 

 

$

582,517

 

 

EAST WEST BANCORP, INC. AND SUBSIDIARIES

ALLOWANCE FOR LOAN LOSSES & OFF-BALANCE-SHEET CREDIT EXPOSURES

($ in thousands)

(unaudited)

Table 10 (continued)

 

 

 

 

Nine Months Ended September 30, 2023

 

 

 

Commercial

 

Consumer

 

 

 

 

 

C&I

 

Total CRE

 

Total Residential

Mortgage

 

Other Consumer

 

Total

Allowance for loan losses, December 31, 2022

 

 

$

371,700

 

 

$

182,346

 

 

$

40,039

 

 

$

1,560

 

 

$

595,645

 

Impact of ASU 2022-02 adoption

 

 

 

5,683

 

 

 

343

 

 

 

2

 

 

 

 

 

 

6,028

 

Allowance for loan losses, January 1, 2023

 

 

$

377,383

 

 

$

182,689

 

 

$

40,041

 

 

$

1,560

 

 

$

601,673

 

Provision for credit losses on loans

(a)

 

 

17,587

 

 

 

44,123

 

 

 

18,727

 

 

 

244

 

 

 

80,681

 

Gross charge-offs

 

 

 

(16,309

)

 

 

(16,251

)

 

 

(138

)

 

 

(101

)

 

 

(32,799

)

Gross recoveries

 

 

 

5,555

 

 

 

857

 

 

 

95

 

 

 

 

 

 

6,507

 

Total net charge-offs

 

 

 

(10,754

)

 

 

(15,394

)

 

 

(43

)

 

 

(101

)

 

 

(26,292

)

Foreign currency translation adjustment

 

 

 

(539

)

 

 

 

 

 

 

 

 

 

 

 

(539

)

Allowance for loan losses, September 30, 2023

 

 

$

383,677

 

 

$

211,418

 

 

$

58,725

 

 

$

1,703

 

 

$

655,523

 

 

 

 

Nine Months Ended September 30, 2022

 

 

 

Commercial

 

Consumer

 

 

 

 

 

C&I

 

Total CRE

 

Total Residential

Mortgage

 

Other Consumer

 

Total

Allowance for loan losses, December 31, 2021

 

 

$

338,252

 

 

$

180,808

 

 

$

20,595

 

 

$

1,924

 

 

$

541,579

 

Provision for (reversal of) credit losses on loans

(a)

 

 

37,867

 

 

 

3,640

 

 

 

10,628

 

 

 

(140

)

 

 

51,995

 

Gross charge-offs

 

 

 

(18,322

)

 

 

(7,304

)

 

 

(968

)

 

 

(90

)

 

 

(26,684

)

Gross recoveries

 

 

 

16,688

 

 

 

1,343

 

 

 

332

 

 

 

 

 

 

18,363

 

Total net charge-offs

 

 

 

(1,634

)

 

 

(5,961

)

 

 

(636

)

 

 

(90

)

 

 

(8,321

)

Foreign currency translation adjustment

 

 

 

(2,736

)

 

 

 

 

 

 

 

 

 

 

 

(2,736

)

Allowance for loan losses, September 30, 2022

 

 

$

371,749

 

 

$

178,487

 

 

$

30,587

 

 

$

1,694

 

 

$

582,517

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

2023

 

June 30,

2023

 

September 30,

2022

 

September 30,

2023

 

September 30,

2022

Unfunded Credit Facilities

 

 

 

 

 

 

 

 

 

 

 

Allowance for unfunded credit commitments, beginning of period (1)

 

 

$

29,728

 

 

$

27,741

 

$

24,304

 

 

$

26,264

 

$

27,514

 

Provision for (reversal of) credit losses on unfunded credit commitments

(b)

 

 

3,864

 

 

 

1,975

 

 

(274

)

 

 

7,319

 

 

(3,495

)

Foreign currency translation adjustment

 

 

 

(3

)

 

 

12

 

 

11

 

 

 

6

 

 

22

 

Allowance for unfunded credit commitments, end of period (1)

 

 

$

33,589

 

 

$

29,728

 

$

24,041

 

 

$

33,589

 

$

24,041

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for credit losses

(a)+(b)

 

$

42,000

 

 

$

26,000

 

$

27,000

 

 

$

88,000

 

$

48,500

 

(1)

Included in Accrued expenses and other liabilities on the Condensed Consolidated Balance Sheet.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

CRITICIZED LOANS, NONPERFORMING ASSETS AND CREDIT QUALITY RATIOS

($ in thousands)

(unaudited)

Table 11

 

Criticized Loans

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

Special mention loans

 

$

483,428

 

 

$

330,741

 

 

$

470,964

 

Classified loans

 

 

538,258

 

 

 

481,051

 

 

 

434,242

 

Total criticized loans (1)

 

$

1,021,686

 

 

$

811,792

 

 

$

905,206

 

 

 

 

Nonperforming Assets

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

Nonaccrual loans:

 

 

 

 

 

 

Commercial:

 

 

 

 

 

 

C&I

 

$

49,147

 

 

$

61,879

 

 

$

47,988

 

Total CRE

 

 

16,431

 

 

 

20,598

 

 

 

11,209

 

Consumer:

 

 

 

 

 

 

Total residential mortgage

 

 

37,986

 

 

 

33,032

 

 

 

23,309

 

Other consumer

 

 

136

 

 

 

24

 

 

 

37

 

Total nonaccrual loans

 

 

103,700

 

 

 

115,533

 

 

 

82,543

 

Nonperforming loans HFS

 

 

 

 

 

 

 

 

14,500

 

Total nonperforming assets

 

$

103,700

 

 

$

115,533

 

 

$

97,043

 

 

 

 

Credit Quality Ratios

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

Annualized quarterly net charge-offs to average loans HFI

 

 

0.14

%

 

 

0.06

%

 

 

0.06

%

Special mention loans to loans HFI

 

 

0.95

%

 

 

0.66

%

 

 

0.99

%

Classified loans to loans HFI

 

 

1.06

%

 

 

0.97

%

 

 

0.92

%

Criticized loans to loans HFI

 

 

2.01

%

 

 

1.63

%

 

 

1.91

%

Nonperforming assets to total assets

 

 

0.15

%

 

 

0.17

%

 

 

0.16

%

Nonaccrual loans to loans HFI

 

 

0.20

%

 

 

0.23

%

 

 

0.17

%

Allowance for loan losses to loans HFI

 

 

1.29

%

 

 

1.28

%

 

 

1.23

%

(1)

Excludes loans HFS.

EAST WEST BANCORP, INC. AND SUBSIDIARIES

GAAP TO NON-GAAP RECONCILIATION

($ in thousands)

(unaudited)

Table 12

The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. Adjusted efficiency ratio represents adjusted noninterest expense divided by adjusted revenue. Pre-tax, pre-provision profitability ratio represents total adjusted revenue less adjusted noninterest expense, divided by average total assets. Adjusted revenue excludes the write-off of an AFS debt security (where applicable). Adjusted noninterest expense excludes the amortization of tax credit and other investments, the amortization of core deposit intangibles and the repurchase agreements’ extinguishment cost (where applicable). Management believes that the measures and ratios presented below provide clarity to financial statement users regarding the ongoing performance of the Company and allow comparability to prior periods.

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

 

September 30,

2023

 

June 30,

2023

 

September 30,

2022

 

September 30,

2023

 

September 30,

2022

Net interest income before provision for credit losses

 

(a)

 

$

570,813

 

 

$

566,746

 

 

$

551,809

 

 

$

1,737,420

 

 

$

1,440,374

 

Total noninterest income

 

 

 

 

76,752

 

 

 

78,631

 

 

 

75,552

 

 

 

215,361

 

 

 

233,739

 

Total revenue

 

(b)

 

$

647,565

 

 

$

645,377

 

 

$

627,361

 

 

$

1,952,781

 

 

$

1,674,113

 

Noninterest income

 

 

 

 

76,752

 

 

 

78,631

 

 

 

75,552

 

 

 

215,361

 

 

 

233,739

 

Add: Write-off of AFS debt security

 

 

 

 

 

 

 

 

 

 

 

 

 

10,000

 

 

 

 

Adjusted noninterest income

 

(c)

 

 

76,752

 

 

 

78,631

 

 

 

75,552

 

 

 

225,361

 

 

 

233,739

 

Adjusted revenue

 

(a)+(c) = (d)

 

$

647,565

 

 

$

645,377

 

 

$

627,361

 

 

$

1,962,781

 

 

$

1,674,113

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest expense

 

(e)

 

$

252,014

 

 

$

261,789

 

 

$

215,973

 

 

$

732,250

 

 

$

602,283

 

Less: Amortization of tax credit and other investments

 

 

 

 

(49,694

)

 

 

(55,914

)

 

 

(19,874

)

 

 

(115,718

)

 

 

(48,753

)

Amortization of core deposit intangibles

 

 

 

 

(441

)