EX-99.1 2 ex_657347.htm EXHIBIT 99.1 ex_657347.htm

Exhibit 99.1

 

FOR IMMEDIATE RELEASE                  

 

 

For:

Cathay General Bancorp

777 N. Broadway   

Los Angeles, CA 90012

Contact:

Heng W. Chen

(626) 279-3652         

 

 

 

Cathay General Bancorp Announces First Quarter 2024 Results

 

 

Los Angeles, Calif., April 22, 2024: 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 March 31, 2024. The Company reported net income of $71.4 million, or $0.98 per share, for the first quarter of 2024. The first quarter net income included a $9.0 million or $0.09 per diluted share mark-to market loss from equity securities held by the Company and a $2.9 million or $0.03 per diluted share accrual for an increase in the FDIC special assessment.

 

FINANCIAL PERFORMANCE

 

   

Three months ended

 

(unaudited)

 

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 

Net income

 

$ 71.4 million

   

$82.5 million

   

$ 96.0 million

 

Basic earnings per common share

    $0.98       $1.14       $1.32  

Diluted earnings per common share

    $0.98       $1.13       $1.32  

Return on average assets

    1.23 %     1.40 %     1.76 %

Return on average total stockholders' equity

    10.40 %     12.21 %     15.39 %

Efficiency ratio

    53.22 %     53.84 %     40.25 %

 

 

FIRST QUARTER HIGHLIGHTS

 

Total deposits increased by $520.8 million, or 10.8% annualized, to $19.85 billion in the first quarter of 2024.

Net interest margin decreased to 3.05% in the first quarter of 2024 from 3.27% in the fourth quarter of 2023.

Diluted earnings per share decreased to $0.98 for the first quarter of 2024 compared to $1.13 for the fourth quarter of 2023 due in part to changes in equity securities valuations.

 

“For the first quarter of 2024, our total deposits increased by $520.8 million, or 10.8% annualized, to $19.85 billion”, commented Chang M. Liu, President and Chief Executive Officer of the Company.

 

 

INCOME STATEMENT REVIEW

FIRST QUARTER 2024 COMPARED TO THE FOURTH QUARTER 2023

 

Net income for the quarter ended March 31, 2024, was $71.4 million, a decrease of $11.1 million, or 13.5%, compared to net income of $82.5 million for the fourth quarter of 2023. Diluted earnings per share for the first quarter of 2024 was $0.98 per share compared to $1.13 per share for the fourth quarter of 2023.The first quarter net income included a $9.0 million, or $0.09 per diluted share mark-to-market loss from equity securities held by the Company and a $2.9 million, or $0.03 per diluted share, accrual for an increase in the FDIC special assessment.

 

 

 

 

Return on average stockholders’ equity was 10.40% and return on average assets was 1.23% for the quarter ended March 31, 2024, compared to a return on average stockholders’ equity of 12.21% and a return on average assets of 1.40% in the fourth quarter of 2023.

 

Net interest income before provision for credit losses

 

Net interest income before provision for credit losses decreased $13.5 million, or 7.4%, to $168.6 million during the first quarter of 2024, compared to $182.1 million in the fourth quarter of 2023. The decrease was due primarily to an increase in deposit interest expense and a decrease in interest income from loans and securities.

 

The net interest margin was 3.05% for the first quarter of 2024 compared to 3.27% for the fourth quarter of 2023.

 

For the first quarter of 2024, the yield on average interest-earning assets was 6.01%, the cost of funds on average interest-bearing liabilities was 3.87%, and the cost of interest-bearing deposits was 3.78%. In comparison, for the fourth quarter of 2023, the yield on average interest-earning assets was 5.99%, the cost of funds on average interest-bearing liabilities was 3.59%, and the cost of interest-bearing deposits was 3.50%. The increase in the costs of average 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 2.14% for the first quarter of 2024, compared to 2.40% for the fourth quarter of 2023.

 

Provision for credit losses

 

The Company recorded a provision for credit losses of $1.9 million in the first quarter of 2024 compared with $1.7 million in the fourth quarter of 2023. As of March 31, 2024, the allowance for credit losses, comprised of the reserve for loan losses and the reserve for unfunded loan commitments, increased $760 thousand to $164.4 million, or 0.85% of gross loans, compared to $163.6 million, or 0.84% of gross loans, as of December 31, 2023.

 

The following table sets forth the charge-offs and recoveries for the periods indicated:

 

   

Three months ended

 
   

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
   

(In thousands) (Unaudited)

 

Charge-offs:

                       

Commercial loans

  $ 1,939     $ 1,392     $ 3,911  

Construction loans

          4,221        

Real estate loans (1)

    254             3,990  

Installment and other loans

                6  

Total charge-offs

    2,193       5,613       7,907  

Recoveries:

                       

Commercial loans

    812       1,426       511  

Construction loans

                 

Real estate loans (1)

    241       55       2,540  

Total recoveries

    1,053       1,481       3,051  

Net charge-offs/(recoveries)

  $ 1,140     $ 4,132     $ 4,856  

 

(1) Real estate loans include commercial real estate loans, residential mortgage loans and equity lines.

 

-2-

 

 

 

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 $6.6 million for the first quarter of 2024, a decrease of $16.5 million, or 71.4%, compared to $23.1 million for the fourth quarter of 2023. The decrease was primarily due to an $18.0 million decrease in unrealized gains on equity securities offset, in part, by a $1.4 million recovery from the sale of a previously written-off security, when compared to the fourth quarter of 2023.

 

Non-interest expense

 

Non-interest expense decreased $17.3 million, or 15.7%, to $93.2 million in the first quarter of 2024 compared to $110.5 million in the fourth quarter of 2023. The decrease in non-interest expense in the first quarter of 2024 was primarily due to a decrease of $11.7 million in amortization expense of investments in low-income housing and alternative energy partnerships, a decrease of $8.3 million in FDIC and state assessments and a decrease of $1.3 million in professional services expenses offset, in part, by an increase of $3.5 million in salaries and employee benefits when compared to the fourth 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 53.22% in the first quarter of 2024 compared to 53.84% for the fourth quarter of 2023.

 

Income taxes

 

The effective tax rate for the first quarter of 2024 was 10.76% compared to 11.28% for the fourth quarter of 2023. The effective tax rate includes the impact of alternative energy investments and low-income housing tax credits.

 

 

BALANCE SHEET REVIEW

 

Gross loans, excluding loans held for sale, were $19.43 billion as of March 31, 2024, a decrease of $118.7 million, or 0.6%, from $19.55 billion as of December 31, 2023. The decrease was primarily due to a decrease of $172.5 million, or 5.2%, in commercial loans, and a decrease of $39.9 million, or 9.4%, in construction loans offset, in part, by an increase of $92.2 million, or 0.9%, in commercial real estate loans and an increase of $3.1 million, or 0.1%, in residential mortgage loans.

 

The loan balances and composition as of March 31, 2024, compared to December 31, 2023, and March 31, 2023, are presented below:

 

   

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
   

(In thousands) (Unaudited)

 

Commercial loans

  $ 3,132,580     $ 3,305,048     $ 3,153,039  

Construction loans

    382,775       422,647       558,967  

Commercial real estate loans

    9,821,807       9,729,581       8,916,766  

Residential mortgage loans

    5,841,846       5,838,747       5,384,220  

Equity lines

    245,222       245,919       298,630  

Installment and other loans

    5,166       6,198       5,717  

Gross loans

  $ 19,429,396     $ 19,548,140     $ 18,317,339  
                         

Allowance for loan losses

    (154,589 )     (154,562 )     (144,884 )

Unamortized deferred loan fees

    (11,737 )     (10,720 )     (5,872 )

Total loans, net

  $ 19,263,070     $ 19,382,858     $ 18,166,583  

 

Total deposits were $19.85 billion as of March 31, 2024, an increase of $520.8 million, or 2.7%, from $19.33 billion as of December 31, 2023.

 

-3-

 

The deposit balances and composition as of March 31, 2024, compared to December 31, 2023, and March 31, 2023, are presented below:

 

   

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
   

(In thousands) (Unaudited)

 

Non-interest-bearing demand deposits

  $ 3,289,539     $ 3,529,018     $ 3,748,719  

NOW deposits

    2,331,486       2,370,685       2,354,195  

Money market deposits

    3,117,557       3,049,754       3,014,500  

Savings deposits

    1,039,144       1,039,203       891,061  

Time deposits

    10,068,533       9,336,787       8,640,397  

Total deposits

  $ 19,846,259     $ 19,325,447     $ 18,648,872  

 

ASSET QUALITY REVIEW

 

As of March 31, 2024, total non-accrual loans were $98.1 million, an increase of $31.4 million, or 47.1%, from $66.7 million as of December 31, 2023.

 

The allowance for loan losses was $154.6 million and the allowance for off-balance sheet unfunded credit commitments was $9.8 million as of March 31, 2024. 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 0.80% of period-end gross loans, and 146.30% of non-performing loans as of March 31, 2024. The comparable ratios were 0.79% of period-end gross loans, and 209.33% of non-performing loans as of December 31, 2023.

 

The changes in non-performing assets and modifications to borrowers experiencing financial difficulties as of March 31, 2024, compared to December 31, 2023, and March 31, 2023, are presented below:

 

(Dollars in thousands) (Unaudited)

 

March 31, 2024

   

December 31, 2023

   

%

Change

   

March 31, 2023

   

%

Change

 

Non-performing assets

                                       

Accruing loans past due 90 days or more

  $ 7,560     $ 7,157       6     $ 12,756       (41 )
                                         

Non-accrual loans:

                                       

Construction loans

    22,998       7,736       197              

Commercial real estate loans

    47,465       32,030       48       40,218       18  

Commercial loans

    14,642       14,404       2       22,079       (34 )

Residential mortgage loans

    13,002       12,511       4       11,283       15  

Total non-accrual loans

  $ 98,107     $ 66,681       47     $ 73,580       33  

Total non-performing loans

    105,667       73,838       43       86,336       22  

Other real estate owned

    19,441       19,441             4,067       378  

Total non-performing assets

  $ 125,108     $ 93,279       34     $ 90,403       38  

Accruing loan modifications to borrowers experiencing financial difficulties

  $     $ 2,872       (100 )   $        
                                         

Allowance for loan losses

  $ 154,589     $ 154,562           $ 144,884       7  

Total gross loans outstanding, at period-end

  $ 19,429,396     $ 19,548,140       (1 )   $ 18,317,339       6  
                                         

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

    146.30 %     209.33 %             167.81 %        

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

    0.80 %     0.79 %             0.79 %        

 

The ratio of non-performing assets to total assets was 0.53% as of March 31, 2024, compared to 0.40% as of December 31, 2023. Total non-performing assets increased $31.8 million, or 34.1%, to $125.1 million as of March 31, 2024, compared to $93.3 million as of December 31, 2023, primarily due to an increase of $31.4 million, or 47.1%, in non-accrual loans, and an increase of $403 thousand, or 5.6%, in accruing loans past due 90 days or more.

 

-4-

 

 

CAPITAL ADEQUACY REVIEW

 

As of March 31, 2024, the Company’s Tier 1 risk-based capital ratio of 13.08%, total risk-based capital ratio of 14.55%, and Tier 1 leverage capital ratio of 10.71%, 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 December 31, 2023, the Company’s Tier 1 risk-based capital ratio was 12.84%, total risk-based capital ratio was 14.31%, and Tier 1 leverage capital ratio was 10.55%.

 

CONFERENCE CALL

 

Cathay General Bancorp will host a conference call to discuss its first quarter 2024 financial results this afternoon, Monday, April 22, 2024, 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 10187902. 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; 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, 2023 (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.         

 

-5-

 

 

CATHAY GENERAL BANCORP

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

 

   

Three months ended

 

(Dollars in thousands, except per share data)

 

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
                         

Financial performance

                       

Net interest income before provision for credit losses

  $ 168,572     $ 182,138     $ 192,435  

Provision for credit losses

    1,900       1,723       8,100  

Net interest income after provision for credit losses

    166,672       180,415       184,335  

Non-interest income

    6,611       23,101       14,244  

Non-interest expense

    93,239       110,498       83,186  

Income before income tax expense

    80,044       93,018       115,393  

Income tax expense

    8,609       10,492       19,386  

Net income

  $ 71,435     $ 82,526     $ 96,007  
                         

Net income per common share

                       

Basic

  $ 0.98     $ 1.14     $ 1.32  

Diluted

  $ 0.98     $ 1.13     $ 1.32  

Cash dividends paid per common share

  $ 0.34     $ 0.34     $ 0.34  
                         

Selected ratios

                       

Return on average assets

    1.23 %     1.40 %     1.76 %

Return on average total stockholders’ equity

    10.40 %     12.21 %     15.39 %

Efficiency ratio

    53.22 %     53.84 %     40.25 %

Dividend payout ratio

    34.59 %     29.92 %     25.63 %
                         

Yield analysis (Fully taxable equivalent)

                       

Total interest-earning assets

    6.01 %     5.99 %     5.54 %

Total interest-bearing liabilities

    3.87 %     3.59 %     2.46 %

Net interest spread

    2.14 %     2.40 %     3.08 %

Net interest margin

    3.05 %     3.27 %     3.74 %
                         

Capital ratios

 

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 

Tier 1 risk-based capital ratio

    13.08 %     12.84 %     12.42 %

Total risk-based capital ratio

    14.55 %     14.31 %     13.94 %

Tier 1 leverage capital ratio

    10.71 %     10.55 %     10.27 %

 

-6-

 

 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(In thousands, except share and per share data)

 

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
                         

Assets

                       

Cash and due from banks

  $ 165,284     $ 173,988     $ 252,048  

Short-term investments and interest bearing deposits

    1,010,651       654,813       881,282  

Securities available-for-sale (amortized cost of $1,783,915 at March 31, 2024, $1,726,080 at December 31, 2023 and $1,672,440 at March 31, 2023)

    1,653,167       1,604,570       1,541,250  

Loans held for sale

    23,171              

Loans

    19,429,396       19,548,140       18,317,339  

Less: Allowance for loan losses

    (154,589 )     (154,562 )     (144,884 )

Unamortized deferred loan fees, net

    (11,737 )     (10,720 )     (5,872 )

Loans, net

    19,263,070       19,382,858       18,166,583  

Equity securities

    31,380       40,406       27,011  

Federal Home Loan Bank stock

    17,250       17,746       17,250  

Other real estate owned, net

    19,441       19,441       4,067  

Affordable housing investments and alternative energy partnerships, net

    330,912       315,683       316,475  

Premises and equipment, net

    90,454       91,097       93,204  

Customers’ liability on acceptances

    17,074       3,264       6,547  

Accrued interest receivable

    97,937       97,673       82,420  

Goodwill

    375,696       375,696       375,696  

Other intangible assets, net

    4,131       4,461       5,564  

Right-of-use assets- operating leases

    31,698       32,076       29,906  

Other assets

    273,487       267,762       232,298  

Total assets

  $ 23,404,803     $ 23,081,534     $ 22,031,601  
                         

Liabilities and Stockholders Equity

                       

Deposits:

                       

Non-interest-bearing demand deposits

  $ 3,289,539     $ 3,529,018     $ 3,748,719  

Interest-bearing deposits:

                       

NOW deposits

    2,331,486       2,370,685       2,354,195  

Money market deposits

    3,117,557       3,049,754       3,014,500  

Savings deposits

    1,039,144       1,039,203       891,061  

Time deposits

    10,068,533       9,336,787       8,640,397  

Total deposits

    19,846,259       19,325,447       18,648,872  
                         

Advances from the Federal Home Loan Bank

    265,000       540,000       360,000  

Other borrowings for affordable housing investments

    17,557       15,787       22,481  

Long-term debt

    119,136       119,136       119,136  

Acceptances outstanding

    17,074       3,264       6,547  

Lease liabilities - operating leases

    34,325       34,797       32,599  

Other liabilities

    327,380       306,528       299,627  

Total liabilities

    20,626,731       20,344,959       19,489,262  

Stockholders' equity

    2,778,072       2,736,575       2,542,339  

Total liabilities and equity

  $ 23,404,803     $ 23,081,534     $ 22,031,601  
                         

Book value per common share

  $ 38.22     $ 37.66     $ 35.12  

Number of common shares outstanding

    72,688,191       72,668,927       72,390,694  

 

-7-

 

 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

   

Three months ended

 
   

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
   

(In thousands, except share and per share data)

 

Interest and Dividend Income

                       

Loans receivable

  $ 302,528     $ 302,477     $ 261,179  

Investment securities

    14,951       14,885       11,764  

Federal Home Loan Bank stock

    431       392       304  

Deposits with banks

    14,732       15,509       12,139  

Total interest and dividend income

    332,642       333,263       285,386  
                         

Interest Expense

                       

Time deposits

    109,546       97,826       64,174  

Other deposits

    42,788       43,282       23,817  

Advances from Federal Home Loan Bank

    9,316       7,289       2,598  

Long-term debt

    1,721       1,759       1,443  

Short-term borrowings

    699       969       919  

Total interest expense

    164,070       151,125       92,951  
                         

Net interest income before provision for credit losses

    168,572       182,138       192,435  

Provision for credit losses

    1,900       1,723       8,100  

Net interest income after provision for credit losses

    166,672       180,415       184,335  
                         

Non-Interest Income

                       

Net (losses)/gains from equity securities

    (9,027 )     8,950       4,853  

Debt securities gains/(losses), net

    1,107             (3,000 )

Letters of credit commissions

    1,717       1,744       1,570  

Depository service fees

    1,550       1,423       1,832  

Wealth management fees

    5,638       4,820       3,897  

Other operating income

    5,626       6,164       5,092  

Total non-interest income

    6,611       23,101       14,244  
                         

Non-Interest Expense

                       

Salaries and employee benefits

    43,552       40,101       38,226  

Occupancy expense

    5,967       5,387       5,504  

Computer and equipment expense

    5,068       4,579       4,285  

Professional services expense

    6,992       8,279       7,406  

Data processing service expense

    3,929       3,718       3,724  

FDIC and State assessments

    6,089       14,358       3,155  

Marketing expense

    1,914       1,110       774  

Other real estate owned expense

    253       195       50  

Amortization of investments in low income housing and alternative energy partnerships

    14,432       26,119       15,594  

Amortization of core deposit intangibles

    339       251       250  

Acquisition, integration and restructuring costs

          671        

Other operating expense

    4,704       5,730       4,218  

Total non-interest expense

    93,239       110,498       83,186  
                         

Income before income tax expense

    80,044       93,018       115,393  

Income tax expense

    8,609       10,492       19,386  

Net income

  $ 71,435     $ 82,526     $ 96,007  

Net income per common share:

                       

Basic

  $ 0.98     $ 1.14     $ 1.32  

Diluted

  $ 0.98     $ 1.13     $ 1.32  
                         

Cash dividends paid per common share

  $ 0.34     $ 0.34     $ 0.34  

Basic average common shares outstanding

    72,673,974       72,652,779       72,533,239  

Diluted average common shares outstanding

    72,971,157       72,906,310       72,899,662  

 

-8-

 

 

CATHAY GENERAL BANCORP

AVERAGE BALANCES SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited)

 

   

Three months ended

 

(In thousands)(Unaudited)

 

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 

 

 

Average Balance

   

Average Yield/Rate (1)

   

Average Balance

   

Average Yield/Rate (1)

   

Average Balance

   

Average Yield/Rate (1)

 
Interest-earning assets:                                                

Loans (1)

  $ 19,498,954       6.24 %   $ 19,330,187       6.21 %   $ 18,245,488       5.81 %

Taxable investment securities

    1,638,317       3.67 %     1,594,267       3.71 %     1,548,841       3.08 %

FHLB stock

    23,006       7.53 %     19,599       7.94 %     17,276       7.14 %

Deposits with banks

    1,093,972       5.42 %     1,130,806       5.44 %     1,070,188       4.60 %

Total interest-earning assets

  $ 22,254,249       6.01 %   $ 22,074,859       5.99 %   $ 20,881,793       5.54 %
                                                 

Interest-bearing liabilities:

                                               

Interest-bearing demand deposits

  $ 2,312,246       2.19 %   $ 2,466,263       2.14 %   $ 2,354,531       1.12 %

Money market deposits

    3,114,298       3.53 %     3,200,455       3.33 %     3,378,257       2.05 %

Savings deposits

    1,046,103       1.10 %     1,112,454       1.11 %     938,485       0.10 %

Time deposits

    9,720,917       4.53 %     9,208,820       4.21 %     8,225,215       3.16 %

Total interest-bearing deposits

  $ 16,193,564       3.78 %   $ 15,987,992       3.50 %   $ 14,896,488       2.40 %

Other borrowed funds

    730,779       5.51 %     600,483       5.46 %     321,522       4.44 %

Long-term debt

    119,136       5.81 %     119,136       5.86 %     119,136       4.91 %

Total interest-bearing liabilities

    17,043,479       3.87 %     16,707,611       3.59 %     15,337,146       2.46 %
                                                 

Non-interest-bearing demand deposits

    3,338,551               3,598,385               3,958,533          
                                                 

Total deposits and other borrowed funds

  $ 20,382,030             $ 20,305,996             $ 19,295,679          
                                                 

Total average assets

  $ 23,451,901             $ 23,304,836             $ 22,098,431          

Total average equity

  $ 2,761,843             $ 2,681,899             $ 2,530,719          

 

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

 

-9-

 

 

CATHAY GENERAL BANCORP

GAAP 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

 
     

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
     

(In thousands) (Unaudited)

 

Stockholders' equity

(a)

  $ 2,778,072     $ 2,736,575     $ 2,542,339  

Less: Goodwill

    (375,696 )     (375,696 )     (375,696 )

Other intangible assets (1)

    (4,131 )     (4,461 )     (5,564 )

Tangible equity

(b)

  $ 2,398,245     $ 2,356,418     $ 2,161,079  
                           

Total assets

(c)

  $ 23,404,803     $ 23,081,534     $ 22,031,601  

Less: Goodwill

    (375,696 )     (375,696 )     (375,696 )

Other intangible assets (1)

    (4,131 )     (4,461 )     (5,564 )

Tangible assets

(d)

  $ 23,024,976     $ 22,701,377     $ 21,650,341  
                           

Number of common shares outstanding

(e)

    72,688,191       72,668,927       72,390,694  
                           

Total stockholders' equity to total assets ratio

(a)/(c)

    11.87 %     11.86 %     11.54 %

Tangible equity to tangible assets ratio

(b)/(d)

    10.42 %     10.38 %     9.98 %

Tangible book value per share

(b)/(e)

  $ 32.99     $ 32.43     $ 29.85  

 

     

Three months ended

 
     

March 31, 2024

   

December 31, 2023

   

March 31, 2023

 
     

(In thousands) (Unaudited)

 

Net Income

  $ 71,435     $ 82,526     $ 96,007  

Add: Amortization of other intangibles (1)

    330       262       192  

Tax effect of amortization adjustments (2)

    (98 )     (78 )     (57 )

Tangible net income

(f)

  $ 71,667     $ 82,710     $ 96,142  
                           

Return on tangible common equity (3)

(f)/(b)

    11.95 %     14.04 %     17.80 %

 

(1) Includes core deposit intangibles and mortgage servicing

(2) Applied the statutory rate of 29.65%.

(3) Annualized

 

-10-