Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

Cathay General Bancorp Announces Second Quarter 2023 Results

CATY

Cathay General Bancorp (the “Company”, “we”, “us”, or “our”) (Nasdaq: CATY), the holding company for Cathay Bank, today announced its unaudited financial results for the quarter ended June 30, 2023. The Company reported net income of $93.2 million, or $1.28 per share, for the second quarter of 2023.

FINANCIAL PERFORMANCE

Three months ended

(unaudited)

June 30, 2023

March 31, 2023

June 30, 2022

Net income $ 93.2 million $ 96.0 million $89.0 million
Basic earnings per common share

$1.29

$1.32

$1.19

Diluted earnings per common share

$1.28

$1.32

$1.18

Return on average assets

1.67%

1.76%

1.69%

Return on average total stockholders' equity

14.47%

15.39%

14.62%

Efficiency ratio

45.36%

40.25%

39.06%

SECOND QUARTER HIGHLIGHTS

  • Total gross loans increased by $635.5 million, or 13.9% annualized, to $19.0 billion in the second quarter of 2023.
  • The net interest margin decreased to 3.44% in the second quarter of 2023 from 3.74% in the first quarter of 2023.
  • Diluted earnings per share decreased to $1.28 for the second quarter of 2023 compared to $1.32 for the first quarter of 2023.

“For the second quarter of 2023, our total loans increased by $635.5 million or 13.9% annualized to $19.0 billion. We are pleased by the $448.1 million increase or 9.7% in total deposits for the quarter,” commented Chang M. Liu, President and Chief Executive Officer of the Company.

INCOME STATEMENT REVIEW
SECOND QUARTER 2023 COMPARED TO THE FIRST QUARTER 2023

Net income for the quarter ended June 30, 2023 was $93.2 million, a decrease of $2.8 million, or 2.9%, compared to net income of $96.0 million for the first quarter of 2023. Net income for the second quarter of 2023 included a $10.7 million unrealized gain on equity securities, or $0.10 per diluted share. Diluted earnings per share for the second quarter of 2023 was $1.28 per share compared to $1.32 per share for the first quarter of 2023.

Return on average stockholders’ equity was 14.47% and return on average assets was 1.67% for the quarter ended June 30, 2023, compared to a return on average stockholders’ equity of 15.39% and a return on average assets of 1.76% in the first quarter of 2023.

Net interest income before provision for credit losses

Net interest income before provision for credit losses decreased $10.9 million, or 5.7%, to $181.5 million during the second quarter of 2023, compared to $192.4 million in the first quarter of 2023. The decrease was due primarily to an increase in deposit interest expense, offset by an increase in income from loans and securities.

The net interest margin was 3.44% for the second quarter of 2023 compared to 3.74% for the first quarter of 2023.

For the second quarter of 2023, the yield on average interest-earning assets was 5.68%, the cost of funds on average interest-bearing liabilities was 2.99%, and the cost of interest-bearing deposits was 2.91%. In comparison, for the first quarter of 2023, the yield on average interest-earning assets was 5.54%, the cost of funds on average interest-bearing liabilities was 2.46%, and the cost of interest-bearing deposits was 2.40%. The increase in the costs of interest-bearing liabilities was mainly a result of higher interest rates on interest bearing deposits. 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 2.69% for the second quarter of 2023, compared to 3.08% for the first quarter of 2023.

Provision for credit losses

The Company recorded a provision for credit losses of $9.2 million in the second quarter of 2023 compared with $8.1 million in the first quarter of 2023. As of June 30, 2023, the allowance for credit losses, comprised of the reserve for loan losses and the reserve for unfunded loan commitments, increased $7.1 million to $165.6 million, or 0.87% of gross loans, compared to $158.5 million, or 0.87% of gross loans, as of March 31, 2023.

Three months ended

Six months ended June 30,

June 30, 2023

March 31, 2023

June 30, 2022

2023

2022

(In thousands) (Unaudited)

Charge-offs:

Commercial loans

$

2,448

$

3,911

$

50

$

6,359

$

271

Real estate loans (1)

34

3,990

1

4,024

1

Installment and other loans

1

6

7

Total charge-offs

2,483

7,907

51

10,390

272

Recoveries:
Commercial loans

442

511

175

953

534

Construction loans

6

Real estate loans (1)

61

2,540

94

2,601

240

Total recoveries

503

3,051

269

3,554

780

Net charge-offs/(recoveries)

$

1,980

$

4,856

$

(218

)

$

6,836

$

(508

)

(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), wealth management fees, and other sources of fee income, was $23.1 million for the second quarter of 2023, an increase of $8.9 million, or 62.7%, compared to $14.2 million for the first quarter of 2023. The increase was primarily due to a $5.8 million increase in unrealized gains on equity securities and a decrease in the write-off of $3.0 million of an available for sale security from Signature Bank when compared to the first quarter of 2023.

Non-interest expense

Non-interest expense increased $9.6 million, or 11.5%, to $92.8 million in the second quarter of 2023 compared to $83.2 million in the first quarter of 2023. The increase in non-interest expense in the second quarter of 2023 was primarily due to an increase of $6.2 million in amortization expense of investments in low-income housing and alternative energy partnerships, an increase of $1.5 million in contributions to the Cathay Bank Foundation, and an increase of $1.5 million in professional services expenses offset, in part, by a decrease of $1.2 million in salaries and employee benefits when compared to the first quarter of 2023. The efficiency ratio, defined as non-interest expense divided by the sum of net interest income before provision for loan losses plus non-interest income, was 45.36% in the second quarter of 2023 compared to 40.25% for the first quarter of 2023.

Income taxes

The effective tax rate for the second quarter of 2023 was 9.2% compared to 16.8% for the first quarter of 2023. The effective tax rate includes the impact of alternative energy investments, including the impact of a new solar tax credit fund that closed in the second quarter of 2023, and low-income housing tax credits.

BALANCE SHEET REVIEW

Gross loans were $18.95 billion as of June 30, 2023, an increase of $635.5 million, or 3.5%, from $18.32 billion as of March 31, 2023. The increase from March 31, 2023 was primarily due to an increase of $376.7 million, or 4.2%, in commercial mortgage loans, an increase of $164.8 million, or 5.2%, in commercial loans and an increase of $158.2 million, or 2.9%, in residential mortgage loans offset, in part, by a decrease of $37.3 million, or 6.7%, in real estate construction loans, and a decrease of $26.6 million, or 8.9%, in home equity loans.

The loan balances and composition as of June 30, 2023, compared to March 31, 2023, and June 30, 2022, are presented below:

June 30, 2023

March 31, 2023

June 30, 2022

(In thousands) (Unaudited)

Commercial loans

$ 3,317,868

$ 3,153,039

$ 3,194,509

Residential mortgage loans

5,542,466

5,384,220

5,045,383

Commercial mortgage loans

9,293,475

8,916,766

8,563,001

Equity lines

272,055

298,630

377,009

Real estate construction loans

521,673

558,967

602,052

Installment and other loans

5,257

5,717

5,934

Gross loans

$ 18,952,794

$ 18,317,339

$ 17,787,888

Allowance for loan losses

(155,109)

(144,884)

(148,772)

Unamortized deferred loan fees

(9,497)

(5,872)

(5,540)

Total loans, net

$ 18,788,188

$ 18,166,583

$ 17,633,576

Total deposits were $19.10 billion as of June 30, 2023, an increase of $448.1 million, or 2.4%, from $18.65 billion as of March 31, 2023.

The deposit balances and composition as of June 30, 2023, compared to March 31, 2023, and June 30, 2022, are presented below:

June 30, 2023

March 31, 2023 June 30, 2022

(In thousands) (Unaudited)

Non-interest-bearing demand deposits

$ 3,561,237

$ 3,748,719

$ 4,433,959

NOW deposits

2,404,470

2,354,195 2,494,524
Money market deposits

3,033,868

3,014,500 5,322,510
Savings deposits

1,131,602

891,061 1,178,572
Time deposits

8,965,826

8,640,397 4,857,762
Total deposits

$ 19,097,003

$ 18,648,872

$ 18,287,327

ASSET QUALITY REVIEW

As of June 30, 2023, total non-accrual loans were $69.0 million, a decrease of $4.6 million, or 6.2%, from $73.6 million as of March 31, 2023.

The allowance for loan losses was $155.1 million and the allowance for off-balance sheet unfunded credit commitments was $10.5 million as of June 30, 2023. The allowances represent the amount estimated by management to be appropriate to absorb expected credit losses inherent in the loan portfolio, including unfunded credit commitments. The allowance for loan losses represented 0.82% of period-end gross loans, and 206.89% of non-performing loans as of June 30, 2023. The comparable ratios were 0.79% of period-end gross loans, and 167.81% of non-performing loans as of March 31, 2023.

The changes in non-performing assets and modifications to borrowers experiencing financial difficulties as of June 30, 2023, compared to March 31, 2023, and June 30, 2022, are presented below:

(Dollars in thousands) (Unaudited)

June 30, 2023

March 31, 2023

%
Change

June 30, 2022

%
Change

Non-performing assets
Accruing loans past due 90 days or more

$

5,968

$

12,756

(53

)

$

1,737

244

Non-accrual loans:
Commercial mortgage loans

39,558

40,218

(2

)

15,141

161

Commercial loans

17,574

22,079

(20

)

27,849

(37

)

Residential mortgage loans

11,872

11,283

5

17,583

(32

)

Installment and other loans

79

(100

)

Total non-accrual loans

$

69,004

$

73,580

(6

)

$

60,652

14

Total non-performing loans

74,972

86,336

(13

)

62,389

20

Other real estate owned

4,067

4,067

4,067

Total non-performing assets

$

79,039

$

90,403

(13

)

$

66,456

19

Accruing loan modifications to borrowers experiencing financial
difficulties (1)

$

$

$

Accruing troubled debt restructurings (TDRs)

$

$

$

12,675

(100

)

Allowance for loan losses

$

155,109

$

144,884

7

$

148,772

4

Total gross loans outstanding, at period-end

$

18,952,794

$

18,317,339

3

$

17,787,888

7

Allowance for loan losses to non-performing loans, at period-end

206.89

%

167.81

%

238.46

%

Allowance for loan losses to gross loans, at period-end

0.82

%

0.79

%

0.84

%

(1) Beginning after January 1, 2023, modifications are reported in accordance with the new guidance under ASU 2022-02.

The ratio of non-performing assets to total assets was 0.3% as of June 30, 2023, compared to 0.4% as of March 31, 2023. Total non-performing assets decreased $11.4 million, or 12.6%, to $79.0 million as of June 30, 2023, compared to $90.4 million as of March 31, 2023, primarily due to a decrease of $6.8 million, or 53.2%, in accruing loans past due 90 days or more and a decrease of $4.6 million, or 6.2%, in nonaccrual loans.

CAPITAL ADEQUACY REVIEW

As of June 30, 2023, the Company’s Tier 1 risk-based capital ratio of 12.38%, total risk-based capital ratio of 13.88%, and Tier 1 leverage capital ratio of 10.45%, 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 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%. As of March 31, 2023, the Company’s Tier 1 risk-based capital ratio was 12.42%, total risk-based capital ratio was 13.94%, and Tier 1 leverage capital ratio was 10.27%.

CONFERENCE CALL

Cathay General Bancorp will host a conference call to discuss its second quarter 2023 financial results this afternoon, Monday, July 24, 2023, 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 1-833-816-1377 and refer to Conference Code 10180640. The presentation accompanying this call and access to the live webcast is available on our site at www.cathaygeneralbancorp.com and a replay of the webcast will be archived for one year within 24 hours after the event.

ABOUT CATHAY GENERAL BANCORP

Cathay General Bancorp is a publicly traded company (Nasdaq: CATY) and is the holding company for Cathay Bank, a California state-chartered bank. Founded in 1962, Cathay Bank offers a wide range of financial services and currently operate over 60 branches across the United States in California, New York, Washington, Texas, Illinois, Massachusetts, Maryland, Nevada, and New Jersey. Overseas, it has a branch outlet in Hong Kong, and a representative office in Beijing, Shanghai, and Taipei. To learn more about Cathay Bank, please visit www.cathaybank.com. Cathay General Bancorp’s website is at www.cathaygeneralbancorp.com. Information set forth on such websites is 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 local, regional, national and international business, market and economic conditions and events and the impact they may have on us, our customers and our operations, assets and liabilities; 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; our ability to generate anticipated returns on our investments and financings, including in tax-advantaged projects; environmental liabilities; our ability to compete with larger competitors; our ability to retain key personnel; successful management of reputational risk; natural disasters, public health crises 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; 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, 2022 (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. Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, we undertake no obligation to update or review any forward-looking statement to reflect circumstances, developments or events occurring after the date on which the statement is made or to reflect the occurrence of unanticipated events.

CATHAY GENERAL BANCORP

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

Three months ended

Six months ended June 30,

(Dollars in thousands, except per share data)

June 30, 2023

March 31, 2023

June 30, 2022

2023

2022

Financial performance
Net interest income before provision for credit losses

$

181,533

$

192,435

$

175,163

$

373,968

$

334,354

Provision for credit losses

9,155

8,100

2,500

17,255

11,143

Net interest income after provision for credit losses

172,378

184,335

172,663

356,713

323,211

Non-interest income

23,110

14,244

14,618

37,354

34,850

Non-interest expense

92,821

83,186

74,123

176,007

146,820

Income before income tax expense

102,667

115,393

113,158

218,060

211,241

Income tax expense

9,447

19,386

24,180

28,833

47,235

Net income

$

93,220

$

96,007

$

88,978

$

189,227

$

164,006

Net income per common share
Basic

$

1.29

$

1.32

$

1.19

$

2.61

$

2.18

Diluted

$

1.28

$

1.32

$

1.18

$

2.60

$

2.17

Cash dividends paid per common share

$

0.34

$

0.34

$

0.34

$

0.68

$

0.68

Selected ratios
Return on average assets

1.67

%

1.76

%

1.69

%

1.71

%

1.58

%

Return on average total stockholders’ equity

14.47

%

15.39

%

14.62

%

14.92

%

13.54

%

Efficiency ratio

45.36

%

40.25

%

39.06

%

42.79

%

39.77

%

Dividend payout ratio

26.46

%

25.63

%

28.70

%

26.04

%

31.13

%

Yield analysis (Fully taxable equivalent)
Total interest-earning assets

5.68

%

5.54

%

3.81

%

5.61

%

3.67

%

Total interest-bearing liabilities

2.99

%

2.46

%

0.41

%

2.73

%

0.39

%

Net interest spread

2.69

%

3.08

%

3.40

%

2.88

%

3.27

%

Net interest margin

3.44

%

3.74

%

3.52

%

3.59

%

3.39

%

Capital ratios June 30, 2023 March 31, 2023 June 30, 2022
Tier 1 risk-based capital ratio

12.38

%

12.42

%

12.18

%

Total risk-based capital ratio

13.88

%

13.94

%

13.74

%

Tier 1 leverage capital ratio

10.45

%

10.27

%

10.15

%

.

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except share and per share data)

June 30, 2023

March 31, 2023

June 30, 2022

Assets
Cash and due from banks

$

187,886

$

252,048

$

141,734

Short-term investments and interest bearing deposits

1,294,379

881,282

1,012,228

Securities available-for-sale (amortized cost of $1,629,357 at June 30, 2023,
$1,672,440 at March 31, 2023 and $1,336,293 at June 30, 2022)

1,487,321

1,541,250

1,234,571

Loans

18,952,794

18,317,339

17,787,888

Less: Allowance for loan losses

(155,109

)

(144,884

)

(148,772

)

Unamortized deferred loan fees, net

(9,497

)

(5,872

)

(5,540

)

Loans, net

18,788,188

18,166,583

17,633,576

Equity securities

37,674

27,011

26,785

Federal Home Loan Bank stock

25,242

17,250

17,250

Other real estate owned, net

4,067

4,067

4,067

Affordable housing investments and alternative energy partnerships, net

323,984

316,475

321,717

Premises and equipment, net

92,090

93,204

97,565

Customers’ liability on acceptances

4,364

6,547

12,650

Accrued interest receivable

86,211

82,420

61,939

Goodwill

375,696

375,696

375,696

Other intangible assets, net

4,992

5,564

7,231

Right-of-use assets- operating leases

31,399

29,906

31,883

Other assets

284,945

232,298

256,661

Total assets

$

23,028,438

$

22,031,601

$

21,235,553

Liabilities and Stockholders’ Equity
Deposits:
Non-interest-bearing demand deposits

$

3,561,237

$

3,748,719

$

4,433,959

Interest-bearing deposits:
NOW deposits

2,404,470

2,354,195

2,494,524

Money market deposits

3,033,868

3,014,500

5,322,510

Savings deposits

1,131,602

891,061

1,178,572

Time deposits

8,965,826

8,640,397

4,857,762

Total deposits

19,097,003

18,648,872

18,287,327

Advances from the Federal Home Loan Bank

815,000

360,000

95,000

Other borrowings for affordable housing investments

22,428

22,481

22,319

Long-term debt

119,136

119,136

119,136

Acceptances outstanding

4,364

6,547

12,650

Lease liabilities - operating leases

33,870

32,599

35,171

Other liabilities

333,966

299,627

232,418

Total liabilities

20,425,767

19,489,262

18,804,021

Stockholders' equity

2,602,671

2,542,339

2,431,532

Total liabilities and equity

$

23,028,438

$

22,031,601

$

21,235,553

Book value per common share

$

35.87

$

35.12

$

32.67

Number of common shares outstanding

72,563,169

72,390,694

74,421,884

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

Three months ended

Six months ended June 30,

June 30, 2023

March 31, 2023

June 30, 2022

2023

2022

(In thousands, except share and per share data)

Interest and Dividend Income
Loan receivable, including loan fees

$

273,478

$

261,179

$

181,022

$

534,657

$

347,116

Investment securities

12,370

11,764

5,748

24,134

10,576

Federal Home Loan Bank stock

298

304

255

602

516

Deposits with banks

13,959

12,139

2,508

26,098

3,271

Total interest and dividend income

300,105

285,386

189,533

585,491

361,479

Interest Expense
Time deposits

79,975

64,174

5,724

144,149

11,784

Other deposits

30,659

23,817

6,895

54,476

12,023

Advances from Federal Home Loan Bank

5,498

2,598

312

8,096

455

Long-term debt

1,552

1,443

1,439

2,995

2,863

Short-term borrowings

888

919

1,807

Total interest expense

118,572

92,951

14,370

211,523

27,125

Net interest income before provision for credit losses

181,533

192,435

175,163

373,968

334,354

Provision for credit losses

9,155

8,100

2,500

17,255

11,143

Net interest income after provision for credit losses

172,378

184,335

172,663

356,713

323,211

Non-Interest Income
Net gains/(losses) from equity securities

10,663

4,853

(955

)

15,516

5,019

Debt securities losses, net

(3,000

)

(3,000

)

Letters of credit commissions

1,664

1,570

1,602

3,234

3,158

Depository service fees

1,641

1,832

1,632

3,473

3,303

Wealth management fees

3,639

3,897

3,956

7,536

8,310

Other operating income

5,503

5,092

8,383

10,595

15,060

Total non-interest income

23,110

14,244

14,618

37,354

34,850

Non-Interest Expense
Salaries and employee benefits

37,048

38,226

37,301

75,274

72,776

Occupancy expense

5,528

5,504

5,562

11,032

11,175

Computer and equipment expense

4,227

4,285

3,297

8,512

6,253

Professional services expense

8,900

7,406

7,704

16,306

14,401

Data processing service expense

3,672

3,724

3,420

7,396

6,329

FDIC and State assessments

3,012

3,155

2,194

6,167

3,996

Marketing expense

2,416

774

1,740

3,190

2,687

Other real estate owned expense

81

50

(33

)

131

38

Amortization of investments in low income housing and
alternative energy partnerships

21,746

15,594

7,235

37,340

15,522

Amortization of core deposit intangibles

559

250

250

809

474

Acquisition, integration and restructuring costs

91

4,027

Other operating expense

5,632

4,218

5,362

9,850

9,142

Total non-interest expense

92,821

83,186

74,123

176,007

146,820

Income before income tax expense

102,667

115,393

113,158

218,060

211,241

Income tax expense

9,447

19,386

24,180

28,833

47,235

Net income

$

93,220

$

96,007

$

88,978

$

189,227

$

164,006

Net income per common share:
Basic

$

1.29

$

1.32

$

1.19

$

2.61

$

2.18

Diluted

$

1.28

$

1.32

$

1.18

$

2.60

$

2.17

Cash dividends paid per common share

$

0.34

$

0.34

$

0.34

$

0.68

$

0.68

Basic average common shares outstanding

72,536,301

72,533,239

74,958,913

72,534,779

75,144,414

Diluted average common shares outstanding

72,753,746

72,899,662

75,270,140

72,826,301

75,493,516

CATHAY GENERAL BANCORP

AVERAGE BALANCES – SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited)

Three months ended

(In thousands)(Unaudited)

June 30, 2023

March 31, 2023

June 30, 2022

Interest-earning assets:

Average
Balance

Average
Yield/Rate (1)

Average
Balance

Average
Yield/Rate (1)

Average

Balance

Average
Yield/Rate (1)

Loans (1)

$

18,503,889

5.93

%

$

18,245,488

5.81

%

$

17,530,650

4.14

%

Taxable investment securities

1,561,443

3.18

%

1,548,841

3.08

%

1,249,679

1.84

%

FHLB stock

18,431

6.49

%

17,276

7.14

%

17,250

5.93

%

Deposits with banks

1,090,019

5.14

%

1,070,188

4.60

%

1,173,702

0.86

%

Total interest-earning assets

$

21,173,782

5.68

%

$

20,881,793

5.54

%

$

19,971,281

3.81

%

Interest-bearing liabilities:
Interest-bearing demand deposits

$

2,325,101

1.57

%

$

2,354,531

1.12

%

$

2,459,940

0.13

%

Money market deposits

3,047,163

2.55

%

3,378,257

2.05

%

5,291,824

0.45

%

Savings deposits

1,076,260

0.81

%

938,485

0.10

%

1,183,821

0.07

%

Time deposits

8,803,900

3.64

%

8,225,215

3.16

%

4,881,365

0.47

%

Total interest-bearing deposits

$

15,252,424

2.91

%

$

14,896,488

2.40

%

$

13,816,950

0.37

%

Other borrowed funds

508,081

5.04

%

321,522

4.44

%

82,660

1.51

%

Long-term debt

119,136

5.22

%

119,136

4.91

%

119,136

4.85

%

Total interest-bearing liabilities

15,879,641

2.99

%

15,337,146

2.46

%

14,018,746

0.41

%

Non-interest-bearing demand deposits

3,667,533

3,958,533

4,391,925

Total deposits and other borrowed funds

$

19,547,174

$

19,295,679

$

18,410,671

Total average assets

$

22,403,606

$

22,098,431

$

21,079,634

Total average equity

$

2,583,677

$

2,530,719

$

2,441,128

Six months ended
(In thousands)(Unaudited) June 30, 2023 June 30, 2022
Interest-earning assets: Average
Balance
Average
Yield/Rate (1)
Average
Balance
Average
Yield/Rate (1)
Loans (1)

$

18,375,402

5.87

%

$

17,236,850

4.06

%

Taxable investment securities

1,555,177

3.13

%

1,212,170

1.76

%

FHLB stock

17,856

6.80

%

17,250

6.03

%

Deposits with banks

1,080,158

4.87

%

1,410,884

0.47

%

Total interest-earning assets

$

21,028,593

5.61

%

$

19,877,154

3.67

%

Interest-bearing liabilities:
Interest-bearing demand deposits

$

2,339,735

1.35

%

$

2,430,141

0.11

%

Money market deposits

3,211,795

2.29

%

5,055,017

0.41

%

Savings deposits

1,007,753

0.48

%

1,130,551

0.07

%

Time deposits

8,516,156

3.41

%

5,084,212

0.47

%

Total interest-bearing deposits

$

15,075,439

2.66

%

$

13,699,921

0.35

%

Securities sold under agreements to repurchase
Other borrowed funds

415,317

4.81

%

63,011

1.46

%

Long-term debt

119,136

5.07

%

119,136

4.85

%

Total interest-bearing liabilities

15,609,892

2.73

%

13,882,068

0.39

%

Non-interest-bearing demand deposits

3,812,215

4,376,246

Total deposits and other borrowed funds

$

19,422,107

$

18,258,314

Total average assets

$

22,251,927

$

20,972,677

Total average equity

$

2,557,390

$

2,443,258

(1) Yields and interest earned include net loan fees. Non-accrual loans are included in the average balance.

CATHAY GENERAL BANCORP
G
AAP to NON-GAAP RECONCILIATION
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(Unaudited)

The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. Tangible equity and tangible equity to tangible assets ratio are non-GAAP financial measures. Tangible equity and tangible assets represent stockholders’ equity and total assets, respectively, which have been reduced by goodwill and other intangible assets. Given that the use of such measures and ratios is more prevalent in the banking industry, and such measures and ratios are used by banking regulators and analysts, the Company has included them below for discussion.

As of

June 30, 2023

March 31, 2023

June 30, 2022

(In thousands) (Unaudited)

Stockholders' equity (a)

$

2,602,671

$

2,542,339

$

2,431,532

Less: Goodwill

(375,696

)

(375,696

)

(375,696

)

Other intangible assets (1)

(4,992

)

(5,564

)

(7,231

)

Tangible equity (b)

$

2,221,983

$

2,161,079

$

2,048,605

Total assets (c)

$

23,028,438

$

22,031,601

$

21,235,553

Less: Goodwill

(375,696

)

(375,696

)

(375,696

)

Other intangible assets (1)

(4,992

)

(5,564

)

(7,231

)

Tangible assets (d)

$

22,647,750

$

21,650,341

$

20,852,626

Number of common shares outstanding (e)

72,563,169

72,390,694

74,421,884

Total stockholders' equity to total assets ratio (a)/(c)

11.30

%

11.54

%

11.45

%

Tangible equity to tangible assets ratio (b)/(d)

9.81

%

9.98

%

9.82

%

Tangible book value per share (b)/(e)

$

30.62

$

29.85

$

27.53

Three months ended

Six months ended

June 30, 2023

March 31, 2023

June 30, 2022

June 30, 2023

June 30, 2022

(In thousands) (Unaudited)
Net Income

$

93,220

$

96,007

$

88,978

$

189,227

$

164,006

Add: Amortization of other intangibles (1)

570

192

277

762

528

Tax effect of amortization adjustments (2)

(169

)

(57

)

(82

)

(226

)

(157

)

Tangible net income (f)

$

93,621

$

96,142

$

89,173

$

189,763

$

164,377

Return on tangible common equity (3) (f)/(b)

16.85

%

17.80

%

17.41

%

17.08

%

16.05

%

(1) Includes core deposit intangibles and mortgage servicing
(2) Applied the statutory rate of 29.65%.
(3) Annualized



Get the latest news and updates from Stockhouse on social media

Follow STOCKHOUSE Today