Note 19 - Equity Incentive Plans

12 Months Ended

Dec. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

19.      Equity Incentive Plans

In 1998, the Board adopted the Cathay Bancorp, Inc. Equity Incentive Plan. Under the Equity Incentive Plan, as amended in September, 2003, directors and eligible employees may be granted incentive or non-statutory stock options and/or restricted stock units, or awarded non-vested stock, for up to 7,000,000 shares of the Company’s common stock on a split adjusted basis. In May 2005, the stockholders of the Company approved the 2005 Incentive Plan. In May 2015, the stockholders of the Company approved, amendment, and restatement of the 2005 Incentive Plan which provides that 3,562,168 shares of the Company’s common stock may be granted as incentive or non-statutory stock options, or as restricted stock, or as restricted stock units. As of December 31, 2015, the only options granted by the Company under the 2005 Incentive Plan, as amended and restated, were non-statutory stock options to selected bank officers and non-employee directors at exercise prices equal to the fair market value of a share of the Company’s common stock on the date of grant. Such options have a maximum ten-year term and vest in 20% annual increments (subject to early termination in certain events) except certain options granted to the Chief Executive Officer of the Company in 2005 and 2008. If such options expire or terminate without having been exercised, any shares not purchased will again be available for future grants or awards. There were no options granted during the three years ended 2015. The Company expects to issue new shares to satisfy stock option exercises and the vesting of restricted stock units.

Cash received from exercises of stock options totaled $5.0 million for 214,580 shares in 2015, $128,000 for 5,500 shares in 2014, and $14.8 million for 594,946 shares in 2013. Aggregate intrinsic value for options exercised was $2.0 million in 2015 compared to $16,000 in 2014.

A summary of stock option activity for 2015, 2014, and 2013 follows:

	Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life (in years)		Aggregate Intrinsic Value (in thousands)
Balance, December 31, 2012		3,996,630			29.45		2.2	$	-
Exercised		(594,946	)	$	24.80
Forfeited		(588,810	)		22.86
Balance, December 31, 2013		2,812,874			31.81		1.9	$	2,119
Exercised		(5,500	)	$	23.37
Forfeited		(474,470	)		29.28
Balance, December 31, 2014		2,332,904			32.34		1.2	$	1,388
Exercised		(214,580	)	$	23.37
Forfeited		(1,087,154	)		35.13
Balance, December 31, 2015		1,031,170			31.27		0.9	$	3,268
Exercisable, December 31, 2015		1,031,170		$	31.27

At December 31, 2015, 3,181,112 shares were available under the 2005 Incentive Plan for future grants. The following table shows stock options outstanding and exercisable as of December 31, 2015, the corresponding exercise prices, and the weighted-average contractual life remaining:

		Outstanding
				Weighted-Average
				Remaining Contractual		Exercisable
Exercise Price		Shares		Life (in Years)		Shares
$	36.90		203,440		0.1		203,440
	38.26		12,000		0.3		12,000
	36.24		405,230		0.1		405,230
	23.37		410,500		2.1		410,500
			1,031,170		0.9		1,031,170

In addition to stock options, the Company also grants restricted stock units to eligible employees which vest subject to continued employment at the vesting dates.

The Company granted restricted stock units for 72,900 shares at an average closing price of $28.11 per share in 2015, 17,601 shares at an average closing price of $24.66 per share in 2014, and for 25,037 shares at an average closing price of $20.68 per share in 2013. The restricted stock units granted in 2014, 2013, and 2012 are scheduled to vest two years from grant date. The restricted stock units granted in 2015 are scheduled to vest three years from grant date.

In December 2013, the Company granted performance share unit awards in which the number of units earned is calculated based on the relative total shareholder return (“TSR”) of the Company’s common stock as compared to the TSR of the KBW Regional Banking Index. In addition, the Company granted performance share unit awards in which the number of units earned is determined by comparison to the targeted EPS as defined in the award for the 2014 to 2016 period. Performance TSR restricted stock units for 119,840 shares and performance EPS restricted stock units for 116,186 shares were granted to eight executive officers in 2013. In December 2014, the Company granted additional performance TSR restricted stock units for 60,456 shares and performance EPS restricted stock units for 57,642 shares were granted to six executive officers. In December 2015, the Company granted additional performance TSR restricted stock units for 61,209 shares and performance EPS restricted stock units for 57,409 shares were granted to seven executive officers. Both the performance TSR and performance EPS share awarded are scheduled to vest three years from grant date.

The following table presents restricted stock unit activity for 2015, 2014, and 2013:

	Units
Balance at December 31, 2012		256,616
Granted		261,062
Vested		(138,220	)
Balance at December 31, 2013		379,458
Granted		135,699
Vested		(122,832	)
Cancelled or forfeited		(5,860	)
Balance at December 31, 2014		386,465
Granted		191,518
Vested		(26,924	)
Cancelled or forfeited		(8,684	)
Balance at December 31, 2015		542,375

All awards are deemed probable of issuance and the compensation expense recorded for restricted stock units was $4.5 million in 2015, $3.8 million in 2014, and $2.0 million in 2013. Unrecognized stock-based compensation expense related to restricted stock units was $7.5 million at December 31, 2015, and is expected to be recognized over the next 2.4 years.

The following table summarizes the tax benefit from options exercised:

	2015			2014			2013
	(In thousands)
Short-fall of tax deductions in excess of grant-date fair value	$	(5,348	)	$	(1,285	)	$	(2,509	)
Benefit of tax deductions on grant-date fair value		6,485			1,292			4,172
Total benefit of tax deductions	$	1,137		$	7		$	1,663