LOS ANGELES, Jan. 23, 2014 /PRNewswire/ -- Cathay General
Bancorp (the "Company", NASDAQ: CATY), the holding company for
Cathay Bank, today announced results for the fourth quarter and for
the year ended December 31, 2013.
FINANCIAL PERFORMANCE
|
Three months ended
December 31,
|
|
Year ended December
31,
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Net income
|
$31.9
million
|
|
$28.3
million
|
|
$123.1
million
|
|
$117.4
million
|
Net income available
to common stockholders
|
$31.9
million
|
|
$24.2
million
|
|
$113.5
million
|
|
$101.0
million
|
Basic earnings per
common share
|
$0.40
|
|
$0.31
|
|
$1.44
|
|
$1.28
|
Diluted earnings per
common share
|
$0.40
|
|
$0.31
|
|
$1.43
|
|
$1.28
|
Return on average
assets
|
1.19%
|
|
1.06%
|
|
1.17%
|
|
1.11%
|
Return on average
total stockholders' equity
|
8.70%
|
|
6.97%
|
|
8.00%
|
|
7.48%
|
Efficiency
ratio
|
44.65%
|
|
53.11%
|
|
50.35%
|
|
52.37%
|
|
|
|
|
|
|
|
|
FULL YEAR HIGHLIGHTS
- Diluted earnings per share increased 11.7% to $1.43 per share for the year ended 2013 compared
to $1.28 per share for the year ended
2012.
- Strong growth in loans – Total loans increased $655.4 million, or 8.8%, during 2013, to
$8.1 billion at December 31, 2013, compared to $7.4 billion at December
31, 2012.
- Redemption on September 30, 2013,
of the remaining $129 million of the
Company's preferred stock issued under the U.S. Treasury's TARP
Capital Purchase Program.
"Our loan growth for the fourth quarter was solid at
$252.6 million, or a 13% annualized
rate. Continuing our goal of increasing our number of
branches to better serve our customers, earlier this week, we
signed an agreement to purchase the deposits of a branch located in
the Richmond District of
San Francisco, which will become
our second branch in the City of San
Francisco," commented Dunson
Cheng, Chairman of the Board, Chief Executive Officer, and
President of the Company.
"Our new West Covina,
California branch opened on December
19, 2013 and we expect to open our new Bensonhurst,
New York branch in March,
2014. Our focus on core deposit generation resulted in core
deposits increasing 10.3% during 2013," said Peter Wu, Executive Vice Chairman and Chief
Operating Officer.
"During December 2013, we
increased our quarterly dividend from $.01 to $.05 per
share. We will continue to work to restore our dividend to
historical levels," concluded Dunson
Cheng.
FOURTH QUARTER INCOME STATEMENT REVIEW
Net income available to common stockholders for the quarter
ended December 31, 2013, was
$31.9 million, an increase of
$7.7 million, or 31.8%, compared to a
net income available to common stockholders of $24.2 million for the same quarter a year
ago. Diluted earnings per share available to common
stockholders for the quarter ended December
31, 2013, was $0.40 compared
to $0.31 for the same quarter a year
ago due primarily to decreases in cost associated with debt
redemption, decreases in other real estate owned ("OREO") expenses,
and decreases in amortization of core deposit intangibles offset by
decreases in gains on sale of securities.
Return on average stockholders' equity was 8.70% and return on
average assets was 1.19% for the quarter ended December 31, 2013, compared to a return on
average stockholders' equity of 6.97% and a return on average
assets of 1.06% for the same quarter a year ago.
Net interest income before provision for credit
losses
Net interest income before provision for credit losses increased
$897,000, or 1.1%, to $82.0 million during the fourth quarter of 2013
compared to $81.1 million during the
same quarter a year ago. The increase was due primarily to
the decrease in interest expense from securities sold under
agreements to repurchase offset by the decrease in interest income
from investment securities.
The net interest margin, on a fully taxable-equivalent basis,
was 3.30% for the fourth quarter of 2013, compared to 3.35% for the
third quarter of 2013, and 3.28% for the fourth quarter of
2012. The decrease in the interest expense on securities sold
under agreements to repurchase offset by decreases in earnings on
investment securities contributed to the increase in the net
interest margin compared to the fourth quarter of 2012.
For the fourth quarter of 2013, the yield on average
interest-earning assets was 4.09%, on a fully taxable-equivalent
basis, the cost of funds on average interest-bearing liabilities
was 1.03%, and the cost of interest bearing deposits was
0.65%. In comparison, for the fourth quarter of 2012, the
yield on average interest-earning assets was 4.25%, on a fully
taxable-equivalent basis, the cost of funds on average
interest-bearing liabilities was 1.25%, and the cost of interest
bearing deposits was 0.65%. 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,
increased six basis points to 3.06% for the quarter ended
December 31, 2013, from 3.00% for the
same quarter a year ago, primarily for the reasons discussed
above.
Provision for credit losses
Provision for credit losses was zero for both the fourth quarter
of 2013 and the fourth quarter of 2012. The provision for
credit losses was based on the review of the adequacy of the
allowance for loan losses at December 31,
2013. The provision or reversal for credit losses represents
the charge against or benefit toward 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
indicated:
|
Three months ended
December 31,
|
|
Year ended December
31,
|
|
2013
|
|
|
2012
|
|
2013
|
|
2012
|
|
(In
thousands)
|
Charge-offs:
|
|
|
|
|
|
|
|
|
Commercial
loans
|
$
11,045
|
|
|
$
3,228
|
|
$
15,625
|
|
$
17,707
|
Construction
loans- residential
|
-
|
|
|
-
|
|
-
|
|
391
|
Construction
loans- other
|
-
|
|
|
-
|
|
-
|
|
774
|
Real estate
loans (1)
|
626
|
|
|
1,265
|
|
3,499
|
|
13,616
|
Real estate-
land loans
|
-
|
|
|
177
|
|
1,318
|
|
278
|
Installment
and other loans
|
-
|
|
|
-
|
|
-
|
|
25
|
Total
charge-offs
|
11,671
|
|
|
4,670
|
|
20,442
|
|
32,791
|
Recoveries:
|
|
|
|
|
|
|
|
|
Commercial
loans
|
724
|
|
|
719
|
|
2,739
|
|
1,949
|
Construction
loans- residential
|
1
|
|
|
76
|
|
1,201
|
|
3,788
|
Construction
loans- other
|
27
|
|
|
452
|
|
1,083
|
|
2,365
|
Real estate
loans (1)
|
1,749
|
|
|
2,036
|
|
5,978
|
|
8,820
|
Real estate-
land loans
|
896
|
|
|
24
|
|
2,997
|
|
1,202
|
Installment
and other loans
|
-
|
|
|
-
|
|
11
|
|
3
|
Total recoveries
|
3,397
|
|
|
3,307
|
|
14,009
|
|
18,127
|
Net
charge-offs
|
$
8,274
|
|
|
$
1,363
|
|
$
6,433
|
|
$
14,664
|
|
|
|
|
|
|
|
|
|
|
|
|
(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), gains (losses) on loan sales, wire transfer fees, and
other sources of fee income, was $8.3
million for the fourth quarter of 2013, a decrease of
$3.9 million, or 31.6%, compared to
$12.2 million for the fourth quarter
of 2012. The decrease in non-interest income in the fourth quarter
of 2013 was primarily due to a decrease of $4.6 million in gains on sale of securities and a
decrease of $470,000 in venture
capital income offset by increases of $331,000 in other miscellaneous loan fees,
$242,000 in commissions from wealth
management, and $230,000 in letters
of credit commissions.
Non-interest expense
Non-interest expense decreased $9.2
million, or 18.6%, to $40.3
million in the fourth quarter of 2013 compared to
$49.5 million in the same quarter a
year ago. The efficiency ratio was 44.65% in the fourth
quarter of 2013 compared to 53.11% for the same quarter a year
ago.
Prepayment penalties decreased $5.9
million to $2,000 in the
fourth quarter of 2013 compared to $5.9
million in the same quarter a year ago. The Company
did not prepay any securities sold under agreements in the fourth
quarter of 2013 compared to $100.0
million in the same period a year ago. In December 2013, the Company prepaid $50.0 million of subordinated debt. OREO
expenses decreased $2.7 million
primarily due to increases in gains on sales of OREO and decreases
in provision for OREO write-downs. Amortization of core
deposit premium decreased $962,000 to
$436,000 in the fourth quarter of
2013 compared to $1.4 million in the
same quarter a year ago as a result of the full amortization of the
core deposit premium from the General Bank acquisition.
Income taxes
The effective tax rate for the fourth quarter of 2013 was 36.0%
compared to 35.1% for the fourth quarter of 2012. The
effective tax rate includes the impact of the utilization of low
income housing tax credits and the recognition of other tax
credits.
BALANCE SHEET REVIEW
Gross loans were $8.08 billion at
December 31, 2013, an increase of
$655.4 million, or 8.8%, from
$7.43 billion at December 31, 2012, primarily due to increases of
$254.6 million, or 6.8%, in
commercial mortgage loans, increases of $209.0 million, or 18.2%, in residential mortgage
loans, and increases of $171.6
million, or 8.1%, in commercial loans. The changes in
loan balances and composition from December
31, 2012, are presented below:
Type of
Loans
|
December 31,
2013
|
|
December 31,
2012
|
|
%
Change
|
|
(Dollars in
thousands)
|
|
|
Commercial
loans
|
$
2,298,724
|
|
$
2,127,107
|
|
8
|
Residential mortgage
loans
|
1,355,255
|
|
1,146,230
|
|
18
|
Commercial mortgage
loans
|
4,023,051
|
|
3,768,452
|
|
7
|
Equity
lines
|
171,277
|
|
193,852
|
|
(12)
|
Real estate
construction loans
|
221,701
|
|
180,950
|
|
23
|
Installment &
other loans
|
14,555
|
|
12,556
|
|
16
|
|
|
|
|
|
|
Gross
loans
|
$
8,084,563
|
|
$
7,429,147
|
|
9
|
|
|
|
|
|
|
Allowance for loan
losses
|
(173,889)
|
|
(183,322)
|
|
(5)
|
Unamortized deferred
loan fees
|
(13,487)
|
|
(10,238)
|
|
32
|
|
|
|
|
|
|
Total loans,
net
|
$
7,897,187
|
|
$
7,235,587
|
|
9
|
|
|
|
|
|
|
Total deposits were $7.98 billion
at December 31, 2013, an increase of
$598.1 million, or 8.1%, from
$7.38 billion at December 31, 2012, primarily due to a
$287.0 million, or 44.6%, increase in
time deposits under $100,000, a
$99.6 million, or 8.4%, increase in
money market deposits, a $172.4
million, or 13.6%, increase in non-interest bearing demand
deposits, a $90.7 million, or 15.3%,
increase in NOW deposits, and a $25.7
million, or 5.4%, increase in saving deposits offset by a
$77.4 million, or 2.4%, decrease in
time deposits of $100,000 or more.
Increases in time deposits under $100,000 were primarily due to increases in
brokered time deposits. The changes in deposit balances and
composition from December 31, 2012,
are presented below:
Deposits
|
December 31,
2013
|
|
December 31,
2012
|
|
%
Change
|
|
(Dollars in
thousands)
|
|
|
Non-interest-bearing
demand deposits
|
$
1,441,858
|
|
$
1,269,455
|
|
14
|
NOW
deposits
|
683,873
|
|
593,133
|
|
15
|
Money market
deposits
|
1,286,338
|
|
1,186,771
|
|
8
|
Savings
deposits
|
499,520
|
|
473,805
|
|
5
|
Time deposits under
$100,000
|
931,204
|
|
644,191
|
|
45
|
Time deposits of
$100,000 or more
|
3,138,512
|
|
3,215,870
|
|
(2)
|
Total
deposits
|
$
7,981,305
|
|
$
7,383,225
|
|
8
|
|
|
|
|
|
|
ASSET QUALITY REVIEW
At December 31, 2013, total
non-accrual loans were $83.2 million,
a decrease of $20.7 million, or
19.9%, from $103.9 million at
December 31, 2012.
The allowance for loan losses was $173.9
million and the allowance for off-balance sheet unfunded
credit commitments was $1.4 million
at December 31, 2013, which
represented the amount believed by management to be sufficient to
absorb credit losses inherent in the loan portfolio, including
unfunded commitments. The allowance for credit losses, which
is the sum of the allowances for loan losses and for off-balance
sheet unfunded credit commitments, was $175.3 million at December
31, 2013, compared to $184.7
million at December 31, 2012,
a decrease of $9.4 million, or
5.1%. The allowance for credit losses represented 2.17% of
period-end gross loans and 208.2% of non-performing loans at
December 31, 2013. The
comparable ratios were 2.49% of period-end gross loans and 176.7%
of non-performing loans at December
31, 2012. The changes in the Company's non-performing
assets and troubled debt restructurings at December 31, 2013, compared to December 31, 2012, and to September 30, 2013, are highlighted below:
(Dollars in
thousands)
|
December 31,
2013
|
|
December 31,
2012
|
|
% Change
|
|
September 30,
2013
|
|
% Change
|
Non-performing
assets
|
|
|
|
|
|
|
|
|
|
Accruing loans past
due 90 days or more
|
$
982
|
|
$
630
|
|
56
|
|
$
499
|
|
97
|
Non-accrual
loans:
|
|
|
|
|
|
|
|
|
|
Construction-
residential loans
|
3,313
|
|
2,984
|
|
11
|
|
3,495
|
|
(5)
|
Construction-
non-residential loans
|
25,273
|
|
33,315
|
|
(24)
|
|
25,500
|
|
(1)
|
Land loans
|
6,502
|
|
6,053
|
|
7
|
|
8,334
|
|
(22)
|
Commercial real
estate loans, excluding land loans
|
13,119
|
|
29,651
|
|
(56)
|
|
27,662
|
|
(53)
|
Commercial
loans
|
21,232
|
|
19,958
|
|
6
|
|
24,506
|
|
(13)
|
Residential mortgage
loans
|
13,744
|
|
11,941
|
|
15
|
|
10,364
|
|
33
|
Total non-accrual
loans:
|
$
83,183
|
|
$
103,902
|
|
(20)
|
|
$
99,861
|
|
(17)
|
Total non-performing
loans
|
84,165
|
|
104,532
|
|
(19)
|
|
100,360
|
|
(16)
|
Other real estate
owned
|
52,985
|
|
46,384
|
|
14
|
|
49,777
|
|
6
|
Total non-performing
assets
|
$
137,150
|
|
$
150,916
|
|
(9)
|
|
$
150,137
|
|
(9)
|
Accruing
troubled debt restructurings (TDRs)
|
$
117,597
|
|
$
144,695
|
|
(19)
|
|
$
115,940
|
|
1
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses
|
$
173,889
|
|
$
183,322
|
|
(5)
|
|
$
181,452
|
|
(4)
|
Allowance for
off-balance sheet credit commitments
|
1,362
|
|
1,363
|
|
(0)
|
|
2,074
|
|
(34)
|
Allowance for credit
losses
|
$
175,251
|
|
$
184,685
|
|
(5)
|
|
$
183,526
|
|
(5)
|
|
|
|
|
|
|
|
|
|
|
Total gross loans
outstanding, at period-end
|
$
8,084,563
|
|
$
7,429,147
|
|
9
|
|
$
7,832,013
|
|
3
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses to non-performing loans, at period-end
|
206.60%
|
|
175.37%
|
|
|
|
180.80%
|
|
|
Allowance for loan
losses to gross loans, at period-end
|
2.15%
|
|
2.47%
|
|
|
|
2.32%
|
|
|
Allowance for credit
losses to gross loans, at period-end
|
2.17%
|
|
2.49%
|
|
|
|
2.34%
|
|
|
Troubled debt restructurings on accrual status totaled
$117.6 million at December 31, 2013, compared to $144.7 million at December
31, 2012. These loans are classified as troubled debt
restructurings as a result of granting a concession to
borrowers. Although these loan modifications are considered
troubled debt restructurings under Accounting Standard Codification
310-40 and Accounting Standard Update 2011-02, these loans have
been performing 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.
The ratio of non-performing assets to total assets was 1.3% at
December 31, 2013, compared to 1.4%
at December 31, 2012. Total
non-performing assets decreased $13.7
million, or 9.1%, to $137.2
million at December 31, 2013,
compared to $150.9 million at
December 31, 2012, primarily due to a
$20.7 million, or 19.9%, decrease in
non-accrual loans offset by a $6.6
million, or 14.2%, increase in OREO.
CAPITAL ADEQUACY REVIEW
At December 31, 2013, the
Company's Tier 1 risk-based capital ratio of 15.03%, total
risk-based capital ratio of 16.34%, and Tier 1 leverage capital
ratio of 12.48%, 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,
2012, the Company's Tier 1 risk-based capital ratio was
17.36%, total risk-based capital ratio was 19.12%, and Tier 1
leverage capital ratio was 13.82%.
FULL YEAR REVIEW
Net income attributable to common stockholders for the year
ended December 31, 2013, was
$113.5 million, an increase of
$12.5 million, or 12.4%, compared to
net income attributable to common stockholders of $101.0 million for the year ended December 31, 2012, due primarily to increases in
gains on sale of securities, decreases in OREO expenses, decreases
in litigation expenses, and increases in commissions from wealth
management, offset by decreases in the reversal for credit losses,
increases in prepayment penalties on the prepayment of securities
sold under an agreement to repurchase, increases in salaries and
incentive compensation expense, increases in consulting expense,
and increases in legal and collection expense. Diluted
earnings per share was $1.43 for the
year ended December 31, 2013,
compared to $1.28 per share for the
year ended December 31, 2012.
The net interest margin for the year ended December 31, 2013, increased five basis points to
3.33% compared to 3.28% for the year ended December 31, 2012.
Return on average stockholders' equity was 8.00% and return on
average assets was 1.17% for the year ended December 31, 2013, compared to a return on
average stockholders' equity of 7.48% and a return on average
assets of 1.11% for the year ended December
31, 2012. The efficiency ratio for the year ended
December 31, 2013, was 50.35%
compared to 52.37% for the year ended December 31, 2012.
CONFERENCE CALL
Cathay General Bancorp will host a conference call this
afternoon to discuss its fourth quarter 2013 financial results. The
call will begin 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
1-877-703-6102 and enter Participant Passcode 88064359. A
listen-only live Webcast of the call will be available at
www.cathaygeneralbancorp.com and a recorded version is scheduled to
be available for replay for 12 months after the call.
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 32 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 Nevada, 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
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 U.S. and international business and
economic conditions; credit risks of lending activities and
deterioration in asset or credit quality; potential supervisory
action by federal supervisory authorities; increased costs of
compliance and other risks associated with changes in regulation
and the current regulatory environment, including the requirements
of the Dodd-Frank Wall Street Reform and Consumer Protection Act
(the "Dodd-Frank Act"), and the potential for substantial changes
in the legal, regulatory, and enforcement framework and oversight
applicable to financial institutions in reaction to recent adverse
financial market events, including changes pursuant to the
Dodd-Frank Act; potential goodwill impairment; liquidity risk;
fluctuations in interest rates; inflation and deflation; risks
associated with acquisitions and the expansion of our business into
new markets; real estate market conditions and the value of real
estate collateral; environmental liabilities; our ability to
compete with larger competitors; the possibility of higher capital
requirements, including implementation of the Basel III capital
standards of the Basel Committee; our ability to retain key
personnel; successful management of reputational risk; natural
disasters and geopolitical events; general economic or business
conditions in California,
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, including successfully
implementing our core system conversion; adverse results in legal
proceedings; 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; successfully raising
additional capital, if needed, and the resulting dilution of
interests of holders of our common stock; and the soundness of
other financial institutions.
These and other factors are further described in Cathay General
Bancorp's Annual Report on Form 10-K for the year ended
December 31, 2012 (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,
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)
|
|
|
|
Three months ended
December 31,
|
|
|
|
Year ended December
31,
|
(Dollars in
thousands, except per share data)
|
|
2013
|
|
2012
|
|
% Change
|
|
2013
|
|
2012
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
PERFORMANCE
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income
before provision for credit
losses
|
|
$
81,962
|
|
$
81,065
|
|
1
|
|
$
324,696
|
|
$
321,253
|
1
|
Provision reversal
for credit losses
|
|
-
|
|
-
|
|
-
|
|
(3,000)
|
|
(9,000)
|
(67)
|
Net interest income
after provision for credit losses
|
|
81,962
|
|
81,065
|
|
1
|
|
327,696
|
|
330,253
|
(1)
|
Non-interest
income
|
|
8,345
|
|
12,202
|
|
(32)
|
|
60,307
|
|
46,507
|
30
|
Non-interest
expense
|
|
40,319
|
|
49,532
|
|
(19)
|
|
193,833
|
|
192,589
|
1
|
Income before income
tax expense
|
|
49,988
|
|
43,735
|
|
14
|
|
194,170
|
|
184,171
|
5
|
Income tax
expense
|
|
17,946
|
|
15,276
|
|
17
|
|
70,435
|
|
66,128
|
7
|
Net income
|
|
32,042
|
|
28,459
|
|
13
|
|
123,735
|
|
118,043
|
5
|
Net income
attributable to noncontrolling interest
|
|
140
|
|
153
|
|
(8)
|
|
592
|
|
605
|
(2)
|
Net income
attributable to Cathay General Bancorp
|
|
$
31,902
|
|
$
28,306
|
|
13
|
|
$
123,143
|
|
$
117,438
|
5
|
Dividends on
preferred stock and noncash charge from repayment
|
-
|
|
(4,127)
|
|
(100)
|
|
(9,685)
|
|
(16,488)
|
(41)
|
Net income
attributable to common stockholders
|
|
$
31,902
|
|
$
24,179
|
|
32
|
|
$
113,458
|
|
$
100,950
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders per common share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.40
|
|
$
0.31
|
|
29
|
|
$
1.44
|
|
$
1.28
|
13
|
Diluted
|
|
$
0.40
|
|
$
0.31
|
|
29
|
|
$
1.43
|
|
$
1.28
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends paid
per common share
|
|
$
0.05
|
|
$
0.01
|
|
400
|
|
$
0.08
|
|
$
0.04
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED
RATIOS
|
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
1.19%
|
|
1.06%
|
|
12
|
|
1.17%
|
|
1.11%
|
5
|
Return on average
total stockholders' equity
|
|
8.70%
|
|
6.97%
|
|
25
|
|
8.00%
|
|
7.48%
|
7
|
Efficiency
ratio
|
|
44.65%
|
|
53.11%
|
|
(16)
|
|
50.35%
|
|
52.37%
|
(4)
|
Dividend payout
ratio
|
|
12.46%
|
|
2.78%
|
|
348
|
|
5.15%
|
|
2.68%
|
92
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YIELD ANALYSIS
(Fully taxable equivalent)
|
|
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
|
4.09%
|
|
4.25%
|
|
(4)
|
|
4.17%
|
|
4.38%
|
(5)
|
Total
interest-bearing liabilities
|
|
1.03%
|
|
1.25%
|
|
(18)
|
|
1.09%
|
|
1.39%
|
(22)
|
Net interest
spread
|
|
3.06%
|
|
3.00%
|
|
2
|
|
3.08%
|
|
2.99%
|
3
|
Net interest
margin
|
|
3.30%
|
|
3.28%
|
|
1
|
|
3.33%
|
|
3.28%
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
RATIOS
|
|
December 31,
2013
|
|
December 31,
2012
|
|
September 30,
2013
|
|
Well Capitalized
Requirements
|
|
Minimum Regulatory
Requirements
|
|
Tier 1 risk-based
capital ratio
|
|
15.03%
|
|
17.36%
|
|
14.88%
|
|
6.0%
|
|
4.0%
|
|
Total risk-based
capital ratio
|
|
16.34%
|
|
19.12%
|
|
16.65%
|
|
10.0%
|
|
8.0%
|
|
Tier 1 leverage
capital ratio
|
|
12.48%
|
|
13.82%
|
|
12.36%
|
|
5.0%
|
|
4.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CATHAY
GENERAL BANCORP
CONDENSED
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
(In thousands, except
share and per share data)
|
|
December 31,
2013
|
|
December 31,
2012
|
|
% change
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
153,747
|
|
$
144,909
|
|
6
|
Short-term
investments and interest bearing deposits
|
|
516,938
|
|
411,983
|
|
25
|
Securities
held-to-maturity (market value of $823,906 in 2012)
|
|
-
|
|
773,768
|
|
(100)
|
Securities
available-for-sale (amortized cost of $1,637,965 in 2013
and
|
|
|
|
|
|
|
$1,290,676 in 2012)
|
|
1,586,668
|
|
1,291,480
|
|
23
|
Trading
securities
|
|
4,936
|
|
4,703
|
|
5
|
Loans
|
|
8,084,563
|
|
7,429,147
|
|
9
|
Less: Allowance
for loan losses
|
|
(173,889)
|
|
(183,322)
|
|
(5)
|
Unamortized
deferred loan fees, net
|
|
(13,487)
|
|
(10,238)
|
|
32
|
Loans,
net
|
|
7,897,187
|
|
7,235,587
|
|
9
|
Federal Home Loan
Bank stock
|
|
25,000
|
|
41,272
|
|
(39)
|
Other real estate
owned, net
|
|
52,985
|
|
46,384
|
|
14
|
Affordable housing
investments, net
|
|
84,108
|
|
85,037
|
|
(1)
|
Premises and
equipment, net
|
|
102,045
|
|
102,613
|
|
(1)
|
Customers' liability
on acceptances
|
|
32,194
|
|
41,271
|
|
(22)
|
Accrued interest
receivable
|
|
24,274
|
|
26,015
|
|
(7)
|
Goodwill
|
|
316,340
|
|
316,340
|
|
-
|
Other intangible
assets, net
|
|
2,230
|
|
6,132
|
|
(64)
|
Other
assets
|
|
191,095
|
|
166,595
|
|
15
|
|
|
|
|
|
|
|
Total
assets
|
|
$
10,989,747
|
|
$
10,694,089
|
|
3
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
$
1,441,858
|
|
$
1,269,455
|
|
14
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
NOW
deposits
|
|
683,873
|
|
593,133
|
|
15
|
Money market
deposits
|
|
1,286,338
|
|
1,186,771
|
|
8
|
Savings
deposits
|
|
499,520
|
|
473,805
|
|
5
|
Time deposits under
$100,000
|
|
931,204
|
|
644,191
|
|
45
|
Time deposits of
$100,000 or more
|
|
3,138,512
|
|
3,215,870
|
|
(2)
|
Total
deposits
|
|
7,981,305
|
|
7,383,225
|
|
8
|
|
|
|
|
|
|
|
Securities sold under
agreements to repurchase
|
|
800,000
|
|
1,250,000
|
|
(36)
|
Advances from the
Federal Home Loan Bank
|
|
521,200
|
|
146,200
|
|
256
|
Other borrowings for
affordable housing investments
|
|
19,062
|
|
18,713
|
|
2
|
Long-term
debt
|
|
121,136
|
|
171,136
|
|
(29)
|
Acceptances
outstanding
|
|
32,194
|
|
41,271
|
|
(22)
|
Other
liabilities
|
|
55,418
|
|
54,040
|
|
3
|
Total
liabilities
|
|
9,530,315
|
|
9,064,585
|
|
5
|
Commitments and
contingencies
|
|
-
|
|
-
|
|
-
|
Stockholders'
Equity
|
|
|
|
|
|
|
Preferred stock,
10,000,000 shares authorized, none issued
|
|
|
|
|
|
|
and outstanding at
December 31, 2013, and 258,000 issued
|
|
|
|
|
|
|
and outstanding at
December 31, 2012
|
|
-
|
|
254,580
|
|
(100)
|
Common stock, $0.01
par value, 100,000,000 shares authorized,
|
|
|
|
|
|
|
83,797,434 issued and
79,589,869 outstanding at December 31, 2013, and
|
|
|
|
|
|
|
82,985,853 issued and
78,778,288 outstanding at December 31, 2012
|
|
838
|
|
830
|
|
1
|
Additional
paid-in-capital
|
|
784,949
|
|
768,925
|
|
2
|
Accumulated other
comprehensive (loss)/income, net
|
|
(29,728)
|
|
465
|
|
(6,493)
|
Retained
earnings
|
|
829,109
|
|
721,993
|
|
15
|
Treasury stock, at
cost (4,207,565 shares at December 31, 2013,
|
|
|
|
|
|
|
and at December 31,
2012)
|
|
(125,736)
|
|
(125,736)
|
|
-
|
|
|
|
|
|
|
|
Total Cathay General
Bancorp stockholders' equity
|
|
1,459,432
|
|
1,621,057
|
|
(10)
|
Noncontrolling
interest
|
|
-
|
|
8,447
|
|
(100)
|
Total
equity
|
|
1,459,432
|
|
1,629,504
|
|
(10)
|
Total liabilities and
equity
|
|
$
10,989,747
|
|
$
10,694,089
|
|
3
|
|
|
|
|
|
|
|
Book value per common
share
|
|
$18.25
|
|
$17.12
|
|
7
|
Number of common
shares outstanding
|
|
79,589,869
|
|
78,778,288
|
|
1
|
|
|
|
|
|
|
|
CATHAY
GENERAL BANCORP
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
|
|
Three months ended
December 31,
|
|
Year ended December
31,
|
|
|
2013
|
2012
|
|
2013
|
2012
|
|
|
(In thousands, except
share and per share data)
|
INTEREST AND
DIVIDEND INCOME
|
|
|
|
|
|
|
Loan receivable,
including loan fees
|
|
$
92,402
|
$
91,157
|
|
$
359,959
|
$
360,643
|
Investment
securities- taxable
|
|
8,426
|
12,349
|
|
43,412
|
62,395
|
Investment
securities- nontaxable
|
|
-
|
1,034
|
|
995
|
4,161
|
Federal Home Loan
Bank stock
|
|
439
|
295
|
|
1,480
|
485
|
Federal funds sold
and securities
|
|
|
|
|
|
|
purchased under
agreements to resell
|
|
-
|
-
|
|
-
|
18
|
Deposits with
banks
|
|
354
|
446
|
|
1,150
|
2,042
|
|
|
|
|
|
|
|
Total interest and
dividend income
|
|
101,621
|
105,281
|
|
406,996
|
429,744
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
Time deposits of
$100,000 or more
|
|
6,745
|
7,289
|
|
27,211
|
33,441
|
Other
deposits
|
|
3,934
|
2,887
|
|
13,178
|
13,932
|
Securities sold under
agreements to repurchase
|
|
7,914
|
12,712
|
|
37,692
|
55,699
|
Advances from Federal
Home Loan Bank
|
|
153
|
74
|
|
528
|
270
|
Long-term
debt
|
|
913
|
1,254
|
|
3,691
|
5,149
|
|
|
|
|
|
|
|
Total interest
expense
|
|
19,659
|
24,216
|
|
82,300
|
108,491
|
|
|
|
|
|
|
|
Net interest income
before provision for credit losses
|
|
81,962
|
81,065
|
|
324,696
|
321,253
|
Provision reversal
for credit losses
|
|
-
|
-
|
|
(3,000)
|
(9,000)
|
|
|
|
|
|
|
|
Net interest income
after provision for credit losses
|
|
81,962
|
81,065
|
|
327,696
|
330,253
|
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
|
Securities gains,
net
|
|
205
|
4,785
|
|
27,362
|
18,026
|
Letters of credit
commissions
|
|
1,673
|
1,443
|
|
6,281
|
6,316
|
Depository service
fees
|
|
1,371
|
1,339
|
|
5,701
|
5,453
|
Other operating
income
|
|
5,096
|
4,635
|
|
20,963
|
16,712
|
|
|
|
|
|
|
|
Total non-interest
income
|
|
8,345
|
12,202
|
|
60,307
|
46,507
|
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
21,084
|
19,951
|
|
88,276
|
78,377
|
Occupancy
expense
|
|
3,880
|
3,682
|
|
14,846
|
14,608
|
Computer and
equipment expense
|
|
2,280
|
2,397
|
|
9,768
|
9,591
|
Professional services
expense
|
|
6,090
|
6,544
|
|
24,574
|
21,768
|
FDIC and State
assessments
|
|
1,920
|
1,785
|
|
7,351
|
8,339
|
Marketing
expense
|
|
700
|
1,199
|
|
3,403
|
4,607
|
Other real estate
owned (income)/expense
|
|
(1,121)
|
1,568
|
|
(235)
|
15,116
|
Operations of
affordable housing investments
|
|
2,301
|
1,919
|
|
7,253
|
6,306
|
Amortization of core
deposit intangibles
|
|
436
|
1,398
|
|
4,533
|
5,663
|
Cost associated with
debt redemption
|
|
2
|
5,920
|
|
22,557
|
12,120
|
Other operating
expense
|
|
2,747
|
3,169
|
|
11,507
|
16,094
|
|
|
|
|
|
|
|
Total non-interest
expense
|
|
40,319
|
49,532
|
|
193,833
|
192,589
|
|
|
|
|
|
|
|
Income before income
tax expense
|
|
49,988
|
43,735
|
|
194,170
|
184,171
|
Income tax
expense
|
|
17,946
|
15,276
|
|
70,435
|
66,128
|
Net income
|
|
32,042
|
28,459
|
|
123,735
|
118,043
|
Less: net income
attributable to noncontrolling interest
|
|
140
|
153
|
|
592
|
605
|
Net income
attributable to Cathay General Bancorp
|
|
31,902
|
28,306
|
|
123,143
|
117,438
|
|
|
|
|
|
|
|
Dividends on
preferred stock and noncash charge from repayment
|
|
-
|
(4,127)
|
|
(9,685)
|
(16,488)
|
Net income
attributable to common stockholders
|
|
$
31,902
|
$
24,179
|
|
$
113,458
|
$
100,950
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders per common share:
|
|
|
|
|
|
|
Basic
|
|
$
0.40
|
$
0.31
|
|
$
1.44
|
$
1.28
|
Diluted
|
|
$
0.40
|
$
0.31
|
|
$
1.43
|
$
1.28
|
|
|
|
|
|
|
|
Cash dividends paid
per common share
|
|
$
0.05
|
$
0.01
|
|
$
0.08
|
$
0.04
|
Basic average common
shares outstanding
|
|
79,256,279
|
78,757,798
|
|
78,954,898
|
78,719,133
|
Diluted average
common shares outstanding
|
|
79,713,155
|
78,759,222
|
|
79,137,983
|
78,723,297
|
|
|
|
|
|
|
|
CATHAY
GENERAL BANCORP
AVERAGE BALANCES –
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(Unaudited)
|
|
|
Three months
ended,
|
|
(In
thousands)
|
December 31,
2013
|
|
December 31,
2012
|
|
September 30,
2013
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets
|
Average
Balance
|
Average
Yield/Rate
(1) (2)
|
|
Average
Balance
|
Average
Yield/Rate
(1) (2)
|
|
Average
Balance
|
Average
Yield/Rate
(1) (2)
|
Loans (1)
|
$
7,945,343
|
4.61%
|
|
$
7,318,749
|
4.96%
|
|
$
7,732,167
|
4.66%
|
Taxable investment
securities
|
1,683,358
|
1.99%
|
|
2,005,074
|
2.45%
|
|
1,869,101
|
2.31%
|
Tax-exempt investment
securities (2)
|
-
|
-
|
|
130,927
|
4.83%
|
|
-
|
-
|
FHLB stock
|
26,801
|
6.50%
|
|
43,290
|
2.71%
|
|
30,938
|
5.76%
|
Deposits with
banks
|
190,092
|
0.74%
|
|
405,467
|
0.44%
|
|
160,985
|
0.76%
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
$
9,845,594
|
4.09%
|
|
$
9,903,507
|
4.25%
|
|
$
9,793,191
|
4.15%
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$
667,005
|
0.16%
|
|
$
568,762
|
0.16%
|
|
$
647,037
|
0.16%
|
Money market
deposits
|
1,323,759
|
0.61%
|
|
1,200,528
|
0.55%
|
|
1,234,091
|
0.58%
|
Savings
deposits
|
504,411
|
0.08%
|
|
469,249
|
0.08%
|
|
471,849
|
0.07%
|
Time
deposits
|
4,047,956
|
0.81%
|
|
3,958,704
|
0.83%
|
|
4,069,612
|
0.80%
|
Total
interest-bearing deposits
|
$
6,543,131
|
0.65%
|
|
$
6,197,243
|
0.65%
|
|
$
6,422,589
|
0.64%
|
Securities sold under
agreements to repurchase
|
800,000
|
3.92%
|
|
1,288,587
|
3.92%
|
|
855,435
|
3.90%
|
Other borrowed
funds
|
87,746
|
0.69%
|
|
41,290
|
0.71%
|
|
82,822
|
0.72%
|
Long-term
debt
|
164,614
|
2.20%
|
|
171,136
|
2.92%
|
|
171,136
|
2.16%
|
Total
interest-bearing liabilities
|
7,595,491
|
1.03%
|
|
7,698,256
|
1.25%
|
|
7,531,982
|
1.05%
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
1,448,044
|
|
|
1,236,304
|
|
|
1,353,451
|
|
|
|
|
|
|
|
|
|
|
Total deposits and
other borrowed funds
|
$
9,043,535
|
|
|
$
8,934,560
|
|
|
$
8,885,433
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$
10,612,221
|
|
|
$
10,641,799
|
|
|
$
10,519,491
|
|
Total average
equity
|
$
1,463,034
|
|
|
$
1,625,065
|
|
|
$
1,547,606
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended,
|
|
|
|
(In
thousands)
|
December 31,
2013
|
|
December 31,
2012
|
|
|
|
|
|
|
|
|
|
|
|
Interest-earning
assets
|
Average
Balance
|
Average
Yield/Rate
(1) (2)
|
|
Average
Balance
|
Average
Yield/Rate
(1) (2)
|
|
|
|
Loans (1)
|
$
7,630,530
|
4.72%
|
|
$
7,095,076
|
5.08%
|
|
|
|
Taxable investment
securities
|
1,903,541
|
2.28%
|
|
2,216,857
|
2.81%
|
|
|
|
Tax-exempt investment
securities (2)
|
29,076
|
5.27%
|
|
131,530
|
4.87%
|
|
|
|
FHLB stock
|
33,446
|
4.43%
|
|
47,938
|
1.01%
|
|
|
|
Federal funds sold
and securities purchased
|
|
|
|
|
|
|
|
|
under agreements to
resell
|
-
|
-
|
|
14,986
|
0.12%
|
|
|
|
Deposits with
banks
|
184,654
|
0.62%
|
|
367,138
|
0.56%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
$
9,781,247
|
4.17%
|
|
$
9,873,525
|
4.38%
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$
634,506
|
0.16%
|
|
$
516,246
|
0.15%
|
|
|
|
Money market
deposits
|
1,215,347
|
0.58%
|
|
1,059,841
|
0.56%
|
|
|
|
Savings
deposits
|
488,932
|
0.08%
|
|
451,022
|
0.08%
|
|
|
|
Time
deposits
|
3,993,508
|
0.80%
|
|
4,197,906
|
0.96%
|
|
|
|
Total
interest-bearing deposits
|
$
6,332,293
|
0.64%
|
|
$
6,225,015
|
0.76%
|
|
|
|
Securities sold under
agreements to repurchase
|
972,329
|
3.88%
|
|
1,361,475
|
4.09%
|
|
|
|
Other borrowed
funds
|
72,687
|
0.73%
|
|
37,717
|
0.72%
|
|
|
|
Long-term
debt
|
169,492
|
2.18%
|
|
171,136
|
3.01%
|
|
|
|
Total
interest-bearing liabilities
|
7,546,801
|
1.09%
|
|
7,795,343
|
1.39%
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
1,325,781
|
|
|
1,157,343
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total deposits and
other borrowed funds
|
$
8,872,582
|
|
|
$
8,952,686
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$
10,506,842
|
|
|
$
10,617,004
|
|
|
|
|
Total average
equity
|
$
1,548,179
|
|
|
$
1,579,195
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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%.
|
|
|
SOURCE Cathay General Bancorp