LOS ANGELES, Oct. 8 /PRNewswire-FirstCall/ -- Cathay General
Bancorp (the "Company"), (NASDAQ:CATY), the holding company for
Cathay Bank (the "Bank"), today announced results for the third
quarter of 2009. FINANCIAL PERFORMANCE Third Quarter Third Quarter
2009 2008 ----------------------------------------------------
-------------- Net (loss)/income ($17.7) million $6.9 million Net
(loss)/income available to common stockholders ($21.8) million $6.9
million (Loss)/basic earnings per common share ($0.43) $0.14
(Loss)/ diluted earnings per common share ($0.43) $0.14 THIRD
QUARTER HIGHLIGHTS -- Nonaccrual loans down 6% - Total nonaccrual
loans decreased by 6%, or $21.5 million, to $361.6 million at
September 30, 2009 compared to $383.1 million at June 30, 2009. --
Total accruing delinquent loans down 50% - Total loans delinquent
30 days or more and still accruing interest decreased by 50% to
$79.3 million at September 30, 2009 compared to $158.2 million at
June 30, 2009. -- Increase in net interest margin - Net interest
margin for the third quarter of 2009 increased to 2.65% from 2.49%
for the second quarter of 2009. -- Allowance for credit losses
strengthened - Total allowance for credit losses increased to
$194.4 million, or 2.73%, of total loans at September 30, 2009
compared to 2.42% of total loans at June 30, 2009. -- Decrease in
provision for credit losses - The Company recorded a provision for
credit losses of $76.0 million during the third quarter of 2009, a
decrease of $17.0 million in the provision for credit losses, as
compared to a provision of $93.0 million during the second quarter
of 2009. -- Capital strengthened - During the month of September
2009, the Company raised $31.7 million in additional capital
through the sale of 3.5 million shares of common stock in its
at-the-market capital offering. "We are pleased that our
nonaccruals dropped by $21.5 million during the third quarter and
are committed to continue to aggressively dispose of other real
estate owned. We are also encouraged by the significant decline in
past due loans. We recorded a provision for credit losses during
the third quarter of $76 million which increased our allowance for
credit losses to 2.73% of total loans," commented Dunson Cheng,
Chairman of the Board, Chief Executive Officer, and President of
the Company. "During the first nine months of the year, we had
solid growth in total deposits, which increased by $874 million, or
13%, net of a $211 million reduction of brokered deposits, which
helped us to improve our net loan to deposit ratio to 89.8% at
September 30, 2009. We are especially pleased that our core
deposits increased $533.9 million to $3.2 billion at September 30,
2009, equating to a 26.9% growth rate, if annualized," said Peter
Wu, Executive Vice Chairman and Chief Operating Officer. "As part
of our ongoing evaluation of our capital levels and needs during
this challenging economic period, we previously announced an 'at
the market' stock issuance program on September 9, 2009 to further
strengthen our capital base. We are pleased that we raised $31.7
million of new capital through this program at the end of the third
quarter. Our focus continues to be managing through this
challenging credit cycle, resolving problem assets on a case by
case basis without resorting to bulk sales and maintaining strong
liquidity. We expect an increase in the pace of sales of nonaccrual
loans and foreclosed real estate during the remainder of the year
as we continue to resolve problem assets," concluded Dunson Cheng.
INCOME STATEMENT REVIEW Net loss attributable to common
stockholders for the three months ended September 30, 2009 was
$21.8 million, a $28.7 million income decrease, compared to net
income attributable to common stockholders of $6.9 million for the
same period a year ago. Loss per share for the three months ended
September 30, 2009, was $0.43 compared to earnings of $0.14 per
diluted share for the same period a year ago due primarily to
increases in the provision for credit losses, lower net interest
income and higher provision for OREO write-downs. Return on average
stockholders' equity was negative 5.58% and return on average
assets was negative 0.60% for the three months ended September 30,
2009, compared to a return on average stockholders' equity of 2.71%
and a return on average assets of 0.25% for the same period of
2008. Net interest income before provision for credit losses Net
interest income before provision for credit losses decreased to
$72.5 million during the third quarter of 2009, a decline of $1.1
million, or 1.5%, compared to $73.6 million during the same quarter
a year ago. The decrease was due primarily to the increases in
interest expense paid for securities sold under agreements to
repurchase. The net interest margin, on a fully taxable-equivalent
basis, was 2.65% for the third quarter of 2009. The net interest
margin increased 16 basis points from 2.49% in the second quarter
of 2009, and decreased 23 basis points from 2.88%, on a fully
taxable-equivalent basis, in the third quarter of 2008. The
decrease in net interest margin from the prior year primarily
resulted from increases in non-accrual loans and the increase in
the borrowing rate on our long term repurchase agreements and other
borrowed funds. The majority of our variable rate loans contain
interest rate floors, which help limit the impact of the recent
decreases in the prime interest rate. For the third quarter of
2009, the yield on average interest-earning assets was 4.82%, on a
fully taxable-equivalent basis, the cost of funds on average
interest-bearing liabilities equaled 2.48%, and the cost of
interest bearing deposits was 1.80%. In comparison, for the third
quarter of 2008, the yield on average interest-earning assets was
5.70%, on a fully taxable-equivalent basis, cost of funds on
average interest-bearing liabilities equaled 3.21%, and the cost of
interest bearing deposits was 2.84%. The interest spread, defined
as the difference between the yield on average interest-earning
assets and the cost of funds on average interest-bearing
liabilities, decreased 15 basis points to 2.34% for the third
quarter ended September 30, 2009, from 2.49% for the same quarter a
year ago, primarily due to the reasons discussed above. The cost of
deposits, including demand deposits, decreased 33 basis points to
1.62% in the third quarter of 2009 compared to 1.95% in the second
quarter of 2009 due primarily to growth in core deposits and
decreased 89 basis points from 2.51% in the third quarter of 2008
due partly to decrease in market rates and partly to growth in core
deposits. Provision for credit losses The provision for credit
losses was $76.0 million for the third quarter of 2009 compared to
$93.0 million for the second quarter of 2009 and compared to $15.8
million in the third quarter of 2008. The provision for credit
losses was based on the review of the adequacy of the allowance for
loan losses at September 30, 2009. The provision for credit losses
represents the charge against current earnings that is determined
by management, through a credit review process, as the amount
needed to establish an allowance that management believes to be
sufficient to absorb credit losses inherent in the Company's loan
portfolio, including unfunded commitments. The following table
summarizes the charge-offs and recoveries for the periods as
indicated: For the three months For the nine months ended September
30, ended September 30,
---------------------------------------------------
------------------- (In thousands) 2009 2008 2009 2008
---------------------------------------- -------- -------- --------
Charge-offs: Commercial loans $27,748 $6,796 $49,913 $8,917
Construction loans- residential 13,126 3,230 58,535 8,239
Construction loans- other 3,072 - 11,840 - Real estate loans 10,732
172 25,188 554 Real estate- land loans 3,865 - 7,599 339
Installment and other loans - - 4 - ------- ------ -------- -------
Total charge-offs 58,543 10,198 153,079 18,049 ------- ------
-------- ------- Recoveries: Commercial loans 219 1,067 523 1,634
Construction loans- residential 598 - 772 83 Construction loans-
other - - 1 - Real estate loans 46 - 46 - Real estate- land loans
685 - 686 - Installment and other loans 2 4 19 16 ------- ------
-------- ------- Total recoveries 1,550 1,071 2,047 1,733 -------
------ -------- ------- Net Charge-offs $56,993 $9,127 $151,032
$16,316 ======= ====== ======== ======= Total charge-offs of $58.5
million for the third quarter of 2009 included $13.1 million of
charge-offs on twelve residential construction loans, $3.1 million
of charge-offs on commercial property construction loans, $9.2
million of charge-offs on commercial real estate loans, $27.7
million on 25 commercial loans, $1.5 million charge-offs on
residential mortgage loans, and $3.9 million of charge-offs on land
loans. Net loan charge-offs increased from $56.0 million in the
second quarter of 2009 to $57.0 million in the third quarter of
2009 and compared to $9.1 million in the third quarter of last
year. Net loan charge-offs remained high in the third quarter as a
result of the continuing weak economy. Non-interest income
Non-interest income, which includes revenues from depository
service fees, letters of credit commissions, securities gains
(losses), gains (losses) on loan sales, wire transfer fees, and
other sources of fee income, was $10.3 million for the third
quarter of 2009, an increase of $18.7 million compared to the
non-interest loss of $8.4 million for the third quarter of 2008.
The increase in non-interest income was primarily due to net
securities losses in 2008 of $15.3 million. In the third quarter of
2009, net gains on sales of agency mortgage-backed securities were
$2.9 million compared to a $27.8 million other-than-temporary
impairment charge on agency preferred stock which was partially
offset by net gains of $12.5 million from sales of agency
mortgage-backed securities in the same quarter a year ago. In the
third quarter of 2009, the Company sold an aircraft owned through a
leveraged lease and recorded a $3.3 million gain. Offsetting the
above gains were losses of $1.3 million from interest rate swap
agreements, a decrease of $1.0 million from foreign exchange and
currency transaction commissions, and $328,000 from higher
write-downs of venture capital investments. Non-interest expense
Non-interest expense increased $3.8 million, or 10.8%, to $38.8
million in the third quarter of 2009 compared to $35.0 million in
the same quarter a year ago. The efficiency ratio was 46.87% in the
third quarter of 2009 compared to 53.69% for the same period a year
ago due to the securities losses recorded in the prior year. OREO
expense increased $2.9 million to $4.1 million in the third quarter
of 2009 from $1.2 million in the same quarter a year ago primarily
due to higher OREO provision and expense resulting from increased
OREO activities. FDIC and State assessments increased $3.2 million
to $4.5 million in the third quarter of 2009 from $1.3 million in
the same quarter a year ago due to a higher assessment rate.
Occupancy expense increased $606,000 primarily due to increases in
depreciation expense of $782,000 primarily related to our new
administrative offices at 9650 Flair Drive, El Monte which opened
in January 2009, which were partially offset by lower rental
expense of $206,000. Professional service expense increased
$284,000, or 8.3%, primarily due to increases in credit appraisal
expenses, legal expenses, and collection expenses. Offsetting the
above described increases were decreases of $2.0 million in
salaries and employee benefits and decreases of $1.4 million
expense from operations of affordable housing investments. Salaries
and employee benefits decreased primarily due to a $665,000
decrease in option compensation expense, a $556,000 decrease in
bonus accruals, and a $331,000 decrease in salaries. Expense from
operations of affordable housing investments decreased as the
result of an expense reversal of $494,000 to the prior year's
estimated losses in the third quarter of 2009 compared to
additional expense adjustment of $577,000 in the same quarter a
year ago. Income taxes The tax benefit for the third quarter of
2009 resulted from the pretax loss for the quarter and the
utilization of low income housing tax credits. BALANCE SHEET REVIEW
Total assets increased by $167.1 million, or 1.4%, to $11.7 billion
at September 30, 2009, from $11.6 billion at December 31, 2008
primarily due to a $211.0 million increase in securities
available-for-sale and a $420.2 million increase in cash, due from
banks and short-term investments offset by a $421.7 million
decrease in net loans. The changes in the loan composition from
December 31, 2008, are presented below: Type of Loans: September
30, December 31, % 2009 2008 Change
------------------------------------------------ -------------
------ (Dollars in thousands) Commercial $1,401,069 $1,620,438 (14)
Residential mortgage 666,510 622,741 7 Commercial mortgage
4,124,384 4,132,850 (0) Equity lines 192,743 168,756 14 Real estate
construction 715,071 913,168 (21) Installment 11,819 11,340 4 Other
5,092 3,075 66 ---------- ---------- Gross loans and leases
$7,116,688 $7,472,368 (5) Allowance for loan losses (189,370)
(122,093) 55 Unamortized deferred loan fees (8,880) (10,094) (12)
---------- ---------- Total loans and leases, net $6,918,438
$7,340,181 (6) ========== ========== Total deposits were $7.7
billion at September 30, 2009, an increase of $874.5 million, or
12.8%, from $6.8 billion at December 31, 2008, primarily due to
increases of $305.7 million, or 46.4%, in money market accounts and
increases of $527.2 million, or 16.3%, in time deposits of $100,000
or more offset by decreases of $160.4 million, or 9.8%, in time
deposits under $100,000. Brokered deposits which are reported in
time deposits under $100,000 declined $226.0 million to $746.9
million at September 30, 2009 from $972.9 million at December 31,
2008. The changes in the deposit composition from December 31,
2008, are presented below: Deposits September 30, December 31, %
2009 2008 Change ----------------------------------------------
------------ ------ (Dollars in thousands) Non-interest-bearing
demand $831,800 $730,433 14 NOW 324,774 257,234 26 Money market
965,159 659,454 46 Savings 349,298 316,263 10 Time deposits under
$100,000 1,484,056 1,644,407 (10) Time deposits of $100,000 or more
3,756,142 3,228,945 16 ---------- ---------- Total deposits
$7,711,229 $6,836,736 13 ========== ========== ASSET QUALITY REVIEW
At September 30, 2009, total non-accrual loans were $361.6 million,
a decrease of $21.5 million, or 5.6%, from $383.1 million at June
30, 2009 and an increase of $180.4 million, or 99.6%, from $181.2
million at December 31, 2008. A summary of non-accrual loans by
collateral type as of September 30, 2009 is shown below: Collateral
Type No. No. No. of Other of of California Borrowers States
Borrowers Total Borrowers -----------------------------------
----------------- ----------------- (Dollars in thousands except
no. of borrowers) Commercial real estate $110,361 32 $55,968 29
$166,329 61 Commercial 18,599 29 6,624 10 25,223 39 Construction-
residential 86,901 16 9,428 6 96,329 22 Construction- non-
residential 34,227 5 974 2 35,201 7 Residential mortgage 8,617 30
2,654 12 11,271 42 Land 22,265 16 4,993 6 27,258 22
------------------ ----------------- ------------------ Total
$280,970 128 $80,641 65 $361,611 193 ==================
================= ================== Included in nonaccrual
commercial real estate loans is a loan with an outstanding balance
of $47.6 million to a borrower who filed for bankruptcy in March
2009. While the loan is non-accrual at September 30, 2009,
management believes that the value of the underlying real estate
collateral is sufficient for a full collection of principal and
interest. Nonaccrual loans also include those troubled debt
restructurings that do not qualify for accrual status. At September
30, 2009, total residential construction loans were $297.1 million
of which $7.9 million were in the Central Valley in California and
$17.7 million were in San Bernardino and Riverside counties in
California. Residential construction loans of $7.9 million in the
Central Valley and $8.3 million in San Bernardino and Riverside
counties were on non-accrual status as of September 30, 2009. At
September 30, 2009, total land loans were $200.7 million of which
$28.6 million were in San Bernardino, Riverside, and Imperial
counties and $2.8 million were in the Central Valley. Land loans of
$2.8 million in the Central Valley and a land loan of $4.7 million
in Riverside were on non-accrual status as of September 30, 2009.
Troubled debt restructurings on accrual status totaled $59.4
million at September 30, 2009 and were comprised of 12 loans. These
loans are classified as troubled debt restructurings as a result of
granting a concession to borrowers. The concessions may be granted
in various forms, including reduction in the stated interest rate,
reduction in the loan balance or accrued interest, and extension of
the maturity date. Although these loan modifications are considered
Statement 15 troubled debt restructurings, the loans have performed
under the restructured terms and have demonstrated sustained
performance under the modified terms. The sustained performance
considered by management includes the periods prior to the
modification if the prior performance met or exceeded the modified
terms as well as cash paid to set up interest reserves. At
September 30, 2009, net carrying value of other real estate owned
increased $25.7 million, or 42.0%, to $86.7 million from $61.0
million at December 31, 2008. At September 30, 2009, $50.6 million
of OREO was located in California, $25.1 million of OREO was
located in Texas, $5.0 million of OREO was located in state of
Washington, $4.5 million of OREO was located in Nevada, and $1.5
million was located in all other states. The ratio of
non-performing assets to total assets was 4.0% at September 30,
2009, compared to 2.2% at December 31, 2008, and compared to 4.2%
at June 30, 2009. Total non-performing assets increased $213.0
million, or 84.6%, to $464.8 million at September 30, 2009,
compared with $251.8 million at December 31, 2008, primarily due to
a $180.4 million increase in non-accrual loans and a $25.7 million
increase in OREO. Total non-performing assets decreased $8.9
million, or 1.9%, to $464.8 million at September 30, 2009, compared
with $473.7 million at June 30, 2009, primarily due to a $21.5
million decrease in non-accrual loans offset by a $12.9 million
increase in OREO. The allowance for loan losses was $189.4 million
and the allowance for off-balance sheet unfunded credit commitments
was $5.0 million at September 30, 2009, and represented the amount
that the Company believes to be sufficient to absorb credit losses
inherent in the Company's loan portfolio. The allowance for credit
losses, the sum of allowance for loan losses and for off-balance
sheet unfunded credit commitments, was $194.4 million at September
30, 2009, compared to $129.4 million at December 31, 2008, an
increase of $65.0 million, or 50.2%. The allowance for credit
losses represented 2.73% of period-end gross loans and 51.4% of
non-performing loans at September 30, 2009. The comparable ratios
were 1.73% of period-end gross loans and 68.9% of non-performing
loans at December 31, 2008. Results of the changes from December
31, 2008 and June 30, 2009, to September 30, 2009, to the Company's
non-performing assets and troubled debt restructurings are
highlighted below: (Dollars in September 30, June 30, % December
31, % thousands) 2009 2009 Change 2008 Change -------------
-------- ------ ------------ ------ Non-performing assets Accruing
loans past due 90 days or more $16,507 $16,952 (3) $6,733 145
Non-accrual loans: Construction- residential 96,329 154,348 (38)
100,169 (4) Construction- non-residential 35,201 23,797 48 22,012
60 Land 27,258 27,060 1 12,608 116 Commercial real estate,
excluding land 166,329 133,161 25 19,733 743 Commercial 25,223
34,844 (28) 20,904 21 Residential mortgage 11,271 9,869 14 5,776 95
-------- -------- -------- Total non-accrual loans: $361,611
$383,079 (6) $181,202 100 -------- -------- -------- Total non-
performing loans 378,118 400,031 (5) 187,935 101 Other real estate
owned and other assets 86,662 73,715 18 63,892 36 -------- --------
-------- Total non-performing assets $464,780 $473,746 (2) $251,827
85 -------- -------- -------- Performing troubled debt
restructurings $59,400 $23,705 151 $924 6,329 ======== ========
======== Allowance for loan losses $189,370 $169,551 12 $122,093 55
Allowance for off-balance sheet credit commitments 5,023 5,835 (14)
7,332 (31) -------- -------- -------- Allowance for credit losses
$194,393 $175,386 11 $129,425 50 ======== ======== ======== Total
gross loans outstanding, at period-end $7,116,688 $7,254,264
(2)$7,472,368 (5) Allowance for loan losses to non-performing
loans, at period-end 50.08% 42.38% 64.97% Allowance for loan losses
to gross loans, at period-end 2.66% 2.34% 1.63% Allowance for
credit losses to non-performing loans, at period-end 51.41% 43.84%
68.87% Allowance for credit losses to gross loans, at period-end
2.73% 2.42% 1.73% Loans past due 30 to 89 days still accruing
decreased $78.5 million, or 55.6%, from $141.3 million at June 30,
2009, to $62.8 million at September 30, 2009. The following table
presents types and changes of loans past due 30 days or more and
still accruing as the dates indicated: (Dollars in September 30,
June 30, % December 31, % thousands) 2009 2009 Change 2008 Change
------------- -------- ------ ------------ ------ Accruing loans
past due 30 to 89 days Construction- residential 8,912 12,295 (28)
28,814 (69) Construction- non-residential 5,654 1,944 191 16,716
(66) Land 6,652 20,170 (67) 12,029 (45) Commercial real estate,
excluding land 26,122 93,808 (72) 48,412 (46) Commercial 12,576
8,569 47 28,568 (56) Residential mortgage 2,884 4,446 (35) 8,271
(65) Other - 65 (100) 5 (100) ------- -------- -------- Total loans
past due 30 to 89 days $62,800 $141,297 (56) $142,815 (56) -------
-------- -------- Accruing loans past due 90 days or more 16,507
16,952 (3) $6,733 145 ------- -------- -------- Total accruing
loans past due 30 or more $79,307 $158,249 (50) $149,548 (47)
======= ======== ======== CAPITAL ADEQUACY REVIEW At September 30,
2009, the Tier 1 risk-based capital ratio of 12.63%, total
risk-based capital ratio of 14.49%, and Tier 1 leverage capital
ratio of 9.29%, 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 6%, 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%. At December 31, 2008, the Company's Tier 1
risk-based capital ratio was 12.12%, the total risk-based capital
ratio was 13.94%, and Tier 1 leverage capital ratio was 9.79%.
During the third quarter of 2009, the Company raised additional
capital of $31.7 million from the sale of approximately 3.5 million
shares of common stock. YEAR-TO-DATE REVIEW Net loss available to
common stockholders for the first nine months of 2009 was $44.4
million, an $97.8 million, or 183%, decrease compared to net income
available to common stockholders of $53.4 million for the same
period a year ago. Loss per share was $0.89 compared to earnings of
$1.08 per diluted share for the same period a year ago due
primarily to increases in the provision for loan losses, lower net
interest income and higher provision for OREO write-downs. The net
interest margin for the nine months ended September 30, 2009,
decreased 38 basis points to 2.61% compared to 2.99% for the same
period a year ago. Return on average stockholders' equity was
negative 3.35% and return on average assets was negative 0.37% for
the nine months ended September 30, 2009, compared to a return on
average stockholders' equity of 7.09% and a return on average
assets of 0.67% for the same period of 2008. The efficiency ratio
for the nine months ended September 30, 2009 was 46.66% compared to
44.00% for the same period a year ago. ABOUT CATHAY GENERAL BANCORP
Cathay General Bancorp is the holding company for Cathay Bank, a
California state-chartered bank. Founded in 1962, Cathay Bank
offers a wide range of financial services. Cathay Bank currently
operates 31 branches in California, eight branches in New York
State, one in Massachusetts, two in Texas, three in Washington
State, three in the Chicago, Illinois area, one in New Jersey, one
in Hong Kong, and a representative office in Shanghai and in
Taipei. Cathay Bank's website is found at
http://www.cathaybank.com/. Cathay General Bancorp's website is
found at http://www.cathaygeneralbancorp.com/. Information set
forth on such websites is not incorporated into this press release.
FORWARD-LOOKING STATEMENTS AND OTHER NOTICES The information
contained in this press release is not intended as a solicitation
to buy Cathay General Bancorp stock or any other securities and is
provided for information only. 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," "could," "estimates," "expects,"
"hopes," "intends," "may," "plans," "projects," "seeks," "shall,"
"should," "will," "predicts," "potential," "continue," and
variations of these words and similar expressions. Forward-looking
statements are based on estimates, beliefs, projections, and
assumptions 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: significant volatility and
deterioration in the credit and financial markets; adverse changes
in general economic conditions; the effects of the Emergency
Economic Stabilization Act, the American Recovery and Reinvestment
Act, and the Troubled Asset Relief Program (TARP) and any changes
or amendments thereto; deterioration in asset or credit quality;
the availability of capital; the impact of any goodwill impairment
that may be determined; acquisitions of other banks, if any;
fluctuations in interest rates; the soundness of other financial
institutions; expansion into new market areas; earthquakes,
wildfires, or other natural disasters; competitive pressures;
changes in laws, regulations, and accounting rules, or their
interpretations; legislative, judicial, or regulatory actions and
developments against us; and general economic or business
conditions in California and other regions where Cathay Bank has
operations, including, but not limited to, adverse changes in
economic conditions resulting from the continuation or worsening of
the current economic downturn. These and other factors are further
described in Cathay General Bancorp's Current Report on Form 8-K
filed on September 9, 2009, as amended on September 23, 2009 (Item
8.01 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, which speak to the date of this press release. Cathay
General Bancorp has no intention and undertakes no obligation to
update any forward-looking statement or to publicly announce any
revision of any forward-looking statement to reflect future
developments or events, except as required by law. Cathay General
Bancorp's filings with the SEC are available at the website
maintained by the SEC at http://www.sec.gov/, or by request
directed to Cathay General Bancorp, 9650 Flair Drive, El Monte,
California 91731, Attention: Investor Relations (626) 279-3286.
CATHAY GENERAL BANCORP CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited) (Dollars in Three months ended Nine months ended
thousands, September 30, September 30, except per
---------------------------- ---------------------------- share
data) 2009 2008 % Change 2009 2008 % Change -----------------------
------- -------- ------- -------- -------- FINANCIAL PERFORMANCE
Net interest income before provision for credit losses $72,515
$73,601 (1) $208,937 $220,905 (5) Provision for credit losses
76,000 15,800 381 216,000 43,800 393 -------- ------- --------
-------- Net interest income after provision for credit losses
(3,485) 57,801 (106) (7,063) 177,105 (104) Non-interest income
10,287 (8,369) (223) 70,382 7,330 860 Non-interest expense 38,807
35,020 11 130,336 100,429 30 -------- ------- -------- --------
(Loss)/income before income tax (benefit) /expense (32,005) 14,412
(322) (67,017) 84,006 (180) Income tax (benefit) /expense (14,482)
7,370 (296) (35,362) 30,133 (217) -------- ------- --------
-------- Net (loss) /income (17,523) 7,042 (349) (31,655) 53,873
(159) Net (loss) /income attributable to noncontrolling interest
(156) (151) 3 (457) (452) 1 -------- ------- -------- -------- Net
(loss) /income attributable to Cathay General Bancorp (17,679)
6,891 (357) (32,112) 53,421 (160) -------- ------- --------
-------- Dividends on preferred stock (4,086) - 100 (12,249) - 100
-------- ------- -------- -------- Net (loss) /income available to
common stockholders $(21,765) $6,891 (416) $(44,361) $53,421 (183)
======== ======= ======== ======== Net (loss) /income available to
common stockholders per common share: Basic $(0.43) $0.14 (407)
$(0.89) $ 1.08 (182) Diluted $(0.43) $0.14 (407) $(0.89) $ 1.08
(182) Cash dividends paid per common share $0.010 $0.105 (90)
$0.195 $ 0.315 (38)
==========================================================================
SELECTED RATIOS Return on average assets -0.60% 0.25% (340) -0.37%
0.67% (155) Return on average total stockholders' equity -5.58%
2.71% (306) -3.35% 7.09% (147) Efficiency ratio 46.87% 53.69% (13)
46.66% 44.00% 6 Dividend payout ratio n/m 75.30% n/m n/m 29.12% n/m
* n/m - not meaningful
==========================================================================
YIELD ANALYSIS (Fully taxable equivalent) Total interest -earning
assets 4.82% 5.70% (15) 4.98% 6.00% (17) Total interest -bearing
liabilities 2.48% 3.21% (23) 2.73% 3.44% (21) Net interest spread
2.34% 2.49% (6) 2.25% 2.56% (12) Net interest margin 2.65% 2.88%
(8) 2.61% 2.99% (13)
==========================================================================
September September December Well Minimum CAPITAL 30, 30, 31,
Capitalized Regulatory RATIOS 2009 2008 2008 Requirements
Requirements Tier 1 risk-based capital ratio 12.63% 9.39% 12.12%
6.0% 4.0% Total risk-based capital ratio 14.49% 11.09% 13.94% 10.0%
8.0% Tier 1 leverage capital ratio 9.29% 7.65% 9.79% 5.0% 4.0%
==========================================================================
CATHAY GENERAL BANCORP CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands, except September 30, December 31, %
share and per share data) 2009 2008 change
--------------------------------- ------------- ------------
--------- Assets Cash and due from banks $198,237 $84,818 134
Short-term investments and interest bearing deposits 331,767 25,000
1,227 Securities purchased under agreements to resell - 201,000
(100) Securities held-to-maturity 99,865 - 100 Securities
available-for-sale (amortized cost of $3,266,440 in 2009 and
$3,043,566 in 2008) 3,294,808 3,083,817 7 Trading securities 12 12
- Loans 7,116,688 7,472,368 (5) Less: Allowance for loan losses
(189,370) (122,093) 55 Unamortized deferred loan fees, net (8,880)
(10,094) (12) ----------- ----------- Loans, net 6,918,438
7,340,181 (6) Federal Home Loan Bank stock 71,791 71,791 - Other
real estate owned, net 86,662 61,015 42 Affordable housing
investments, net 98,046 103,562 (5) Premises and equipment, net
109,370 104,107 5 Customers' liability on acceptances 28,974 39,117
(26) Accrued interest receivable 33,459 43,603 (23) Goodwill
316,340 319,557 (1) Other intangible assets, net 24,448 29,246 (16)
Other assets 137,546 75,813 81 ----------- ----------- Total assets
$11,749,763 $11,582,639 1 =========== =========== Liabilities and
Stockholders' Equity Deposits Non-interest-bearing demand deposits
$831,800 $730,433 14 Interest-bearing deposits: NOW deposits
324,774 257,234 26 Money market deposits 965,159 659,454 46 Savings
deposits 349,298 316,263 10 Time deposits under $100,000 1,484,056
1,644,407 (10) Time deposits of $100,000 or more 3,756,142
3,228,945 16 ----------- ---------- Total deposits 7,711,229
6,836,736 13 ----------- ---------- Federal funds purchased -
52,000 (100) Securities sold under agreements to repurchase
1,550,000 1,610,000 (4) Advances from the Federal Home Loan Bank
929,362 1,449,362 (36) Other borrowings from financial institutions
1,313 - 100 Other borrowings for affordable housing investments
19,355 19,500 (1) Long-term debt 171,136 171,136 - Acceptances
outstanding 28,974 39,117 (26) Other liabilities 58,929 103,401
(43) ----------- ---------- Total liabilities 10,470,298 10,281,252
2 ----------- ---------- Commitments and contingencies - - -
----------- ---------- Stockholders' Equity Preferred stock,
10,000,000 shares authorized, 258,000 issued and outstanding in
2009 and 2008 243,103 240,554 1 Common stock, $0.01 par value,
100,000,000 shares authorized, 57,279,715 issued and 53,072,150
outstanding at September 30, 2009 and 53,715,815 issued and
49,508,250 outstanding at December 31, 2008 573 537 7 Additional
paid-in-capital 545,010 508,613 7 Accumulated other comprehensive
income, net 16,441 23,327 (30) Retained earnings 591,574 645,592
(8) Treasury stock, at cost (4,207,565 shares in 2009 and in 2008)
(125,736) (125,736) - ----------- ---------- Total Cathay General
Bancorp stockholders' equity 1,270,965 1,292,887 (2) -----------
---------- Noncontrolling interest 8,500 8,500 - -----------
---------- Total equity 1,279,465 1,301,387 (2) -----------
---------- Total liabilities and equity $11,749,763 $11,582,639 1
=========== =========== Book value per common stock share $19.09
$20.90 (9) Number of common stock shares outstanding 53,072,150
49,508,250 7 CATHAY GENERAL BANCORP CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (Unaudited) Three months ended Nine months
ended September 30, September 30, -----------------------
--------------------- 2009 2008 2009 2008 -----------------------
--------------------- (In thousands, except share and per share
data) INTEREST AND DIVIDEND INCOME Loan receivable, including loan
fees $99,588 $114,005 $302,232 $341,880 Investment securities-
taxable 31,589 27,575 94,104 84,507 Investment securities-
nontaxable 167 284 620 974 Federal Home Loan Bank stock 149 1,004
149 2,685 Agency preferred stock - 313 - 1,621 Federal funds sold
and securities purchased under agreements to resell 35 2,899 1,338
12,294 Deposits with banks 119 42 250 523 -----------------------
--------------------- Total interest and dividend income 131,647
146,122 398,693 444,484 -----------------------
--------------------- INTEREST EXPENSE Time deposits of $100,000 or
more 20,224 26,226 65,337 86,398 Other deposits 10,622 17,100
40,196 49,519 Securities sold under agreements to repurchase 16,555
15,174 48,527 44,716 Advances from Federal Home Loan Bank 10,664
11,785 31,781 35,229 Long-term debt 1,067 2,030 3,891 6,889
Short-term borrowings - 206 24 828 -----------------------
--------------------- Total interest expense 59,132 72,521 189,756
223,579 ----------------------- --------------------- Net interest
income before provision for credit losses 72,515 73,601 208,937
220,905 Provision for credit losses 76,000 15,800 216,000 43,800
----------------------- --------------------- Net interest income
after provision for loan losses (3,485) 57,801 (7,063) 177,105
----------------------- --------------------- NON-INTEREST INCOME
Securities gains (losses), net 2,883 (15,313) 52,319 (12,980)
Letters of credit commissions 1,150 1,465 3,159 4,281 Depository
service fees 1,272 1,189 3,940 3,636 Other operating income 4,982
4,290 10,964 12,393 ----------------------- ---------------------
Total non-interest income 10,287 (8,369) 70,382 7,330
----------------------- --------------------- NON-INTEREST EXPENSE
Salaries and employee benefits 14,410 16,376 46,369 50,643
Occupancy expense 3,999 3,393 12,126 9,918 Computer and equipment
expense 2,052 1,848 5,938 6,024 Professional services expense 3,694
3,410 10,021 8,890 FDIC and State assessments 4,464 1,336 15,372
3,172 Marketing expense 669 584 2,153 2,449 Other real estate owned
expense (income) 4,135 1,182 20,150 1,806 Operations of affordable
housing investments 1,407 2,840 5,255 5,361 Amortization of core
deposit intangibles 1,689 1,722 5,089 5,196 Other operating expense
2,288 2,329 7,863 6,970 -----------------------
--------------------- Total non-interest expense 38,807 35,020
130,336 100,429 ----------------------- ---------------------
(Loss)/income before income tax (benefit) /expense (32,005) 14,412
(67,017) 84,006 Income tax (benefit) /expense (14,482) 7,370
(35,362) 30,133 ----------------------- --------------------- Net
(loss)/income (17,523) 7,042 (31,655) 53,873 Less: net income
attributable to noncontrolling interest (156) (151) (457) (452)
----------------------- --------------------- Net (loss)/income
attributable to Cathay General Bancorp (17,679) 6,891 (32,112)
53,421 ----------------------- --------------------- Dividends on
preferred stock (4,086) - (12,249) - -----------------------
--------------------- Net (loss)/income available to common
stockholders $(21,765) $6,891 $(44,361) $53,421
======================= ===================== Net (loss)/income
available to common stockholders per common share: Basic $(0.43)
$0.14 $(0.89) $1.08 Diluted $(0.43) $0.14 $(0.89) $1.08 Cash
dividends paid per common share $0.010 $0.105 $0.195 $0.315 Basic
average common shares outstanding 50,183,296 49,441,621 49,758,833
49,392,655 Diluted average common shares outstanding 50,183,296
49,530,272 49,758,833 49,497,171 CATHAY GENERAL BANCORP AVERAGE
BALANCES - SELECTED CONSOLIDATED FINANCIAL INFORMATION (Unaudited)
For the three months ended,
--------------------------------------------------------------------------
(In thousands) September 30, September 30, June 30, 2009 2008 2009
-------------------------------- -------------------
------------------- Interest- Average Average Average earning
Average Yield/Rate Average Yield/Rate Average Yield/Rate assets
Balance (1) (2) Balance (1) (2) Balance (1) (2) -------------------
-------------------- ------------------- Loans and leases(1)
$7,211,984 5.48% $7,425,818 6.11% $7,342,100 5.39% Taxable
investment securities 3,385,904 3.70% 2,484,473 4.42% 3,158,632
3.85% Tax-exempt investment securities(2) 18,590 5.48% 47,938 7.20%
19,315 6.60% FHLB stock 71,819 0.82% 64,228 6.22% 71,791 0.00%
Federal funds sold and securities purchased under agreements to
resell 104,946 0.13% 188,522 6.12% 3,989 0.10% Deposits with banks
57,297 0.82% 8,941 1.87% 37,363 0.78% -------------------
-------------------- ------------------- Total interest -earning
assets $10,850,540 4.82% $10,219,920 5.70% $10,633,190 4.88%
----------- ----------- ----------- Interest- bearing liabilities
Interest- bearing demand deposits $310,047 0.40% $268,802 0.57%
$278,944 0.41% Money market 967,839 1.54% 760,679 1.81% 834,063
1.56% Savings deposits 338,053 0.21% 337,538 0.31% 328,274 0.21%
Time deposits 5,175,066 2.04% 4,708,290 3.31% 5,064,471 2.50%
------------------- -------------------- ------------------- Total
interest -bearing deposits $6,791,005 1.80% $6,075,309 2.84%
$6,505,752 2.18% Federal funds purchased 163 0.45% 39,842 2.06%
16,747 0.26% Securities sold under agreements to repurchase
1,556,343 4.22% 1,550,000 3.89% 1,559,302 4.12% Other borrowed
funds 957,558 4.42% 1,157,430 4.05% 962,405 4.40% Long-term debt
171,136 2.47% 171,136 4.72% 171,136 3.09% -------------------
-------------------- ------------------- Total interest -bearing
liabilities 9,476,205 2.48% 8,993,717 3.21% 9,215,342 2.75%
Non-interest -bearing demand deposits 783,826 788,028 749,573
----------- ----------- ----------- Total deposits and other
borrowed funds $10,260,031 $9,781,745 $9,964,915 -----------
----------- ----------- Total average assets $11,626,641
$10,926,283 $11,385,247 Total average equity $1,264,864 $1,019,003
$1,300,018 ----------- ----------- ----------- For the nine months
ended,
-------------------------------------------------------------------------
(In thousands) September 30, September 30, 2009 2008
----------------------------------------------------
-------------------- Average Average Interest- Average Yield/Rate
Average Yield/Rate earning assets Balance (1) (2) Balance (1) (2)
----------------------- -------------------- Loans and leases (1)
$7,336,822 5.51% $7,118,773 6.42% Taxable investment securities
3,174,308 3.96% 2,404,666 4.69% Tax-exempt investment securities
(2) 20,234 6.30% 58,690 8.49% FHLB stock 71,800 0.28% 65,283 5.49%
Federal funds sold and securities purchased under agreements to
resell 63,300 2.83% 261,613 6.28% Deposits with banks 42,614 0.78%
13,007 5.37% ----------------------- -------------------- Total
interest-earning assets $10,709,078 4.98% $9,922,032 6.00%
----------- ---------- Interest-bearing liabilities
Interest-bearing demand deposits $283,027 0.40% $253,380 0.65%
Money market deposits 854,706 1.56% 733,578 1.92% Savings deposits
325,943 0.22% 335,193 0.39% Time deposits 5,070,283 2.48% 4,448,113
3.70% ----------------------- -------------------- Total interest-
bearing deposits $6,533,959 2.16% $5,770,264 3.15% Federal funds
purchased 11,220 0.27% 40,299 2.65% Securities sold under
agreements to repurchase 1,565,455 4.14% 1,553,622 3.84% Other
borrowed funds 1,012,015 4.20% 1,149,401 4.10% Long-term debt
171,136 3.04% 171,136 5.38% -----------------------
-------------------- Total interest-bearing liabilities 9,293,785
2.73% 8,684,722 3.44% Non-interest-bearing demand deposits 757,719
777,664 ----------- ---------- Total deposits and other borrowed
funds $10,051,504 $9,462,386 ----------- ---------- Total average
assets $11,461,781 $10,597,770 Total average equity $1,288,780
$1,014,810 ----------- ---------- (1) Yields and interest earned
include net loan fees. Non-accrual loans are included in the
average balance. (2) The average yield has been adjusted to a fully
taxable-equivalent basis for certain securities of states and
political subdivisions and other securities held using a statutory
Federal income tax rate of 35%. DATASOURCE: Cathay General Bancorp
CONTACT: Heng W. Chen of Cathay General Bancorp, +1-626-279-3652
Web Site: http://www.cathaybank.com/
http://www.cathaygeneralbancorp.com/
Copyright
Cathay General Bancorp (NASDAQ:CATY)
Historical Stock Chart
From Jun 2024 to Jul 2024
Cathay General Bancorp (NASDAQ:CATY)
Historical Stock Chart
From Jul 2023 to Jul 2024