Note 10 - Capital Resources

12 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

10. Capital Resources

Total equity was

$2.12

billion at

December 31, 2018,

an increase of

$148.6

 million, or

7.5%,

from

$1.97

billion at

December 31, 2017,

primarily due to increases in net income of

$271.9

million, proceeds from dividend reinvestment of

$2.8

million, and proceeds from exercise of stock options of

$838,000,

offset by purchases of treasury stock of

$42.6

million, shares withheld related to net share settlement of RSUs of

$2.4

million, and common stock cash dividends of

$83.4

million. The Company paid cash dividends of

$1.03

per common share in

2018

and

$0.87

per common share in

2017.

In

January

and

February

of

2016,

the Company repurchased the remaining

633,250

shares under the

August 2015

two million

share repurchase program for

$17.0

million, or an average price of

$26.82

per share.

On

February 1, 2016,

the Board of Directors approved a new stock repurchase program to buy back up to

$45.0

million of our common stock. In

2016,

the Company repurchased

1,380,578

shares for

$37.5

million, or

$27.13

per share under the

February 2016

repurchase program. In

October 2018,

the Company repurchased

200,326

shares for

$7.5

million, or

$37.65

per share, and completed its

February 2016

$45.0

million repurchase program.

On

October 26, 2018,

the Board of Directors approved a new stock repurchase program to buy back up to

$45.0

million of our common stock. In

2018,

the Company repurchased

913,400

shares for

$35.1

million, or

$38.43

per share, under the

October 2018

repurchase program. As of

December 31, 2018,

the Company

may

repurchase up to

$9.9

million of its common stock under the

October 2018

repurchase program.

The

five

special purpose trusts are considered variable interest entities. Because the Bancorp is

not

the primary beneficiary of the trusts, the financial statements of the trusts are

not

included in the Consolidated Financial Statements of the Company. The Junior Subordinated Notes, all of which were issued before

May 19, 2010,

are currently included in the Tier

2

capital of the Bancorp for regulatory capital purposes. Under the Dodd-Frank Act, trust preferred securities issued before

May 19, 2010

by bank holding companies with assets of less than

$15

billion as of

December 31, 2019

continue to qualify for Tier

1

capital treatment. As of

December 31, 2017,

the Company’s assets exceeded the

$15

billion threshold and, as a result, the Junior Subordinated Notes

no

longer qualify as Tier

1

capital for regulatory reporting purposes. The Junior Subordinated Notes qualify as Tier

1

capital for regulatory reporting purposes at

December 31, 2016.

The table below summarizes the outstanding Junior Subordinated Notes issued by the Company to each trust as of

December 31, 2018:

		Principal		Not			Current			Date of	Payable/
	Issuance	Balance of		Redeemable	Stated	Annualized	Interest			Rate	Distribution
Trust Name	Date	Notes		Until	Maturity	Coupon Rate	Rate			Change	Date
(Dollars in thousands)
Cathay Capital
Trust I	June 26,	$	20,619	June 30,	June 30,	3-month		5.95	%	December 30,	March 30
	2003			2008	2033	LIBOR				2018	June 30
						+ 3.15%					September 30
											December 30
Cathay Statutory
Trust I	September 17,		20,619	September 17,	September 17,	3-month		5.79	%	December 18,	March 17
	2003			2008	2033	LIBOR				2018	June 17
											+ 3.00% December 17
Cathay Capital
Trust II	December 30,		12,887	March 30,	March 30,	3-month		5.70	%	December 30,	March 30
	2003			2009	2034	LIBOR				2018	June 30
						+ 2.90%					September 30
											December 30
Cathay Capital
Trust III	March 28,		46,392	June 15,	June 15,	3-month		4.27	%	December 15,	March 15
	2007			2012	2037	LIBOR				2018	June 15
						+ 1.48%					September 15
											December 15
Cathay Capital
Trust IV	May 31,		18,619	September 6,	September 6,	3-month		4.14	%	December 6,	March 6
	2007			2012	2037	LIBOR				2018	June 6
						+ 1.4%					September 6
											December 6
Total Junior Subordinated Notes		$	119,136