LOS ANGELES, July 27, 2020 /PRNewswire/ -- 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 June
30, 2020. The Company reported net income of
$54.3 million, or $0.68 per share, for the second quarter of
2020.
FINANCIAL PERFORMANCE
|
Three months
ended
|
(unaudited)
|
June 30,
2020
|
|
March 31,
2020
|
|
June 30,
2019
|
Net income
|
$54.3
million
|
|
$46.9
million
|
|
$72.2
million
|
Basic earnings per
common share
|
$0.68
|
|
$0.59
|
|
$0.90
|
Diluted earnings per
common share
|
$0.68
|
|
$0.59
|
|
$0.90
|
Return on average
assets
|
1.15%
|
|
1.05%
|
|
1.69%
|
Return on average
total stockholders' equity
|
9.31%
|
|
8.12%
|
|
13.27%
|
Efficiency
ratio
|
44.82%
|
|
44.60%
|
|
44.53%
|
SECOND QUARTER HIGHLIGHTS
- Total deposits increased for the quarter by $1.2 billion, or 7.9%, to $16.3 billion.
"For the second quarter of 2020, our total deposits increased
$1.2 billion, or 31.6% annualized, to
$16.3 billion, with the majority of
the increase in core deposits. This strong growth in deposits
reflects Cathay's commitment to serve the financial needs of our
customers during this challenging time," commented Pin Tai, Chief
Executive Officer of the Company.
SECOND QUARTER INCOME STATEMENT REVIEW
Net income for the quarter ended June 30,
2020, was $54.3 million, a
decrease of $17.9 million, or 24.8%,
compared to net income of $72.2
million for the same quarter a year ago. Diluted
earnings per share for the quarter ended June 30, 2020, was $0.68 per share compared to $0.90 per share for the same quarter a year
ago.
Return on average stockholders' equity was 9.31% and return on
average assets was 1.15% for the quarter ended June 30, 2020, compared to a return on average
stockholders' equity of 13.27% and a return on average assets of
1.69% for the same quarter a year ago.
Net interest income before provision for credit
losses
Net interest income before provision for credit losses decreased
$8.9 million, or 6.2%, to
$134.5 million during the second
quarter of 2020, compared to $143.4
million during the same quarter a year ago. The
decrease was due primarily to a decrease in interest income from
loans and securities.
The net interest margin was 3.02% for the second quarter of 2020
compared to 3.58% for the second quarter of 2019 and 3.34% for the
first quarter of 2020.
For the second quarter of 2020, the yield on average
interest-earning assets was 3.91%, the cost of funds on average
interest-bearing liabilities was 1.20%, and the cost of
interest-bearing deposits was 1.16%. In comparison, for the
second quarter of 2019, the yield on average interest-earning
assets was 4.81%, the cost of funds on average interest-bearing
liabilities was 1.65%, and the cost of interest-bearing deposits
was 1.58%. The decrease in the yield on average interest-earning
assets resulted mainly from lower rates on loans. 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 2.71% for the quarter ended
June 30, 2020, compared to 3.16% for
the same quarter a year ago.
Provision for credit losses
Based on a review of the appropriateness of the allowance for
loan losses at June 30, 2020, the
Company recorded a provision for credit losses of $25.0 million in second quarter of 2020 compared
to no provision for credit losses in the second quarter of 2019.
The provision for credit losses is primarily a result of the
economic deterioration of the global economy resulting from the
COVID-19 pandemic. The Company will continue to monitor the
continuing impact of the pandemic on credit risks and losses, as
well as on customer demand deposits and other liabilities and
assets. As permitted under the Coronavirus, Aid, Relief and
Economic Security Act (the "CARES Act"), the Company has chosen to
defer the adoption of the Current Expected Credit Losses (CECL)
methodology for estimated credit losses until the earlier of the
date the US government declares an end to the national emergency or
December 31, 2020. The expected
impact of CECL on second quarter results, if CECL had been adopted,
will be disclosed in our Form 10-Q for the second quarter of
2020. The following table sets forth the charge-offs and
recoveries for the periods indicated:
|
Three months
ended
|
|
Six months ended June
30,
|
|
June 30,
2020
|
|
March 31,
2020
|
|
June 30,
2019
|
|
2020
|
|
2019
|
|
(In thousands)
(Unaudited)
|
Charge-offs:
|
|
|
|
|
|
|
|
|
|
Commercial
loans
|
$
5,106
|
|
$
1,321
|
|
$
1,713
|
|
$6,427
|
|
$2,944
|
Total
charge-offs
|
5,106
|
|
1,321
|
|
1,713
|
|
6,427
|
|
2,944
|
Recoveries:
|
|
|
|
|
|
|
|
|
|
Commercial
loans
|
1,350
|
|
1,208
|
|
1,356
|
|
2,558
|
|
1,397
|
Construction
loans
|
—
|
|
—
|
|
30
|
|
—
|
|
1,074
|
Real estate
loans(1)
|
163
|
|
162
|
|
423
|
|
325
|
|
733
|
Total recoveries
|
1,513
|
|
1,370
|
|
1,809
|
|
2,883
|
|
3,204
|
Net
charge-offs/(recoveries)
|
$
3,593
|
|
$
(49)
|
|
$
(96)
|
|
$3,544
|
|
$ (260)
|
|
(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), wire transfer fees, and other sources of fee income, was
$15.6 million for the second quarter
of 2020, an increase of $2.8 million,
or 21.9%, compared to $12.8 million
for the second quarter of 2019. The increase was primarily
due to a $2.5 million increase in net
gains from equity securities, and an increase of $1.1 million from the gain on sale of mortgage
backed securities, offset in part by a $682.1 thousand decrease in the valuation of
interest rate swap contracts, when compared to the same quarter a
year ago.
Non-interest expense
Non-interest expense decreased $2.2
million, or 3.2%, to $67.3
million in the second quarter of 2020 compared to
$69.5 million in the same quarter a
year ago. The decrease in non-interest expense in the second
quarter of 2020 was primarily due to a $5.0
million decrease in salaries and employee benefits resulting
from lower bonus accruals and an increase in salaries capitalized
for loan originations offset in part by an increase of $3.8 million in amortization expense of
investments in low-income housing and alternative energy
partnerships when compared to the same quarter a year ago.
The efficiency ratio was 44.8% in the second quarter of 2020
compared to 44.5% for the same quarter a year ago.
Income taxes
The effective tax rate for the second quarter of 2020 was 6.0%
compared to 16.6% for the second quarter of 2019. The effective tax
rate includes an alternative energy investment made in the second
quarter of 2020 and the impact of low-income housing tax
credits.
BALANCE SHEET REVIEW
Gross loans were $15.6 billion at
June 30, 2020, an increase of
$532.8 million, or 3.5%, from
$15.1 billion at December 31, 2019. The increase was
primarily due to $261.7 million in
Paycheck Protection Loans and increases of $116.2 million, or 1.6%, in commercial mortgage
loans, $96.1 million, or 2.4%, in
residential mortgage loans, $51.2
million, or 14.7%, in equity lines and $44.3 million, or 7.6%, in real estate
construction loans. The loan balances and composition at
June 30, 2020, compared to
December 31, 2019 and June 30, 2019, are presented below:
|
June 30,
2020
|
|
December 31,
2019
|
|
June 30,
2019
|
|
(In thousands)
(Unaudited)
|
Commercial
loans
|
$
2,746,316
|
|
$
2,778,744
|
|
$
2,772,982
|
Paycheck protection
program loans
|
261,650
|
|
—
|
|
—
|
Residential mortgage
loans
|
4,184,721
|
|
4,088,586
|
|
3,967,135
|
Commercial mortgage
loans
|
7,391,502
|
|
7,275,262
|
|
6,945,562
|
Equity
lines
|
399,207
|
|
347,975
|
|
302,351
|
Real estate
construction loans
|
624,199
|
|
579,864
|
|
598,849
|
Installment and other
loans
|
688
|
|
5,050
|
|
6,631
|
Gross
loans
|
$
15,608,283
|
|
$
15,075,481
|
|
$
14,593,510
|
|
|
|
|
|
|
Allowance for loan
losses
|
(169,680)
|
|
(123,224)
|
|
(122,651)
|
Unamortized deferred
loan fees
|
(4,507)
|
|
(626)
|
|
(1,415)
|
Total loans,
net
|
$
15,434,096
|
|
$
14,951,631
|
|
$
14,469,444
|
Total deposits were $16.3 billion
at June 30, 2020, an increase of
$1.6 billion, or 10.9%, from
$14.7 billion at December 31, 2019. The increases in
non-interest bearing demand deposits and money market deposits
resulted from higher liquidity maintained by our depositors during
these uncertain times, unused funds still in demand deposit
accounts from payroll protection program loans and improved money
market deposit generation from corporate accounts. The deposit
balances and composition at June 30,
2020, compared to December 31,
2019 and June 30, 2019, are
presented below:
|
June 30,
2020
|
|
December 31,
2019
|
|
June 30,
2019
|
|
(In thousands)
(Unaudited)
|
Non-interest-bearing
demand deposits
|
$
3,298,415
|
|
$
2,871,444
|
|
$
2,758,344
|
NOW
deposits
|
1,671,290
|
|
1,358,152
|
|
1,267,464
|
Money market
deposits
|
2,982,385
|
|
2,260,764
|
|
1,909,097
|
Savings
deposits
|
743,982
|
|
758,903
|
|
716,206
|
Time
deposits
|
7,585,832
|
|
7,443,045
|
|
7,711,811
|
Total
deposits
|
$
16,281,904
|
|
$
14,692,308
|
|
$
14,362,922
|
ASSET QUALITY REVIEW
At June 30, 2020, total
non-accrual loans were $56.5 million,
an increase of $16.0 million, or
39.5%, from $40.5 million at
December 31, 2019, and an increase of
$1.8 million, or 3.3%, from
$54.7 million at June 30, 2019 due primarily to a $11.7 million commercial loan.
The allowance for loan losses was $169.7
million and the allowance for off-balance sheet unfunded
credit commitments was $4.7 million
at June 30, 2020, which represented
the amount believed by management to be appropriate to absorb
credit losses inherent in the loan portfolio, including unfunded
credit commitments. The $169.7
million allowance for loan losses at June 30, 2020, increased $46.5 million, or 37.7%, from $123.2 million at December
31, 2019. This increase includes additional provisions
for credit losses and reflects the deterioration in economic
conditions related to COVID-19 and an increase in specific reserves
of $4.3 million. The allowance for
loan losses represented 1.09% of period-end gross loans, and 218.0%
of non-performing loans at June 30,
2020. The comparable ratios were 0.82% of period-end gross
loans, and 262.6% of non-performing loans at December 31, 2019. Accruing loans past due
90 days or more at June 30, 2020 have
been reduced to $3.1 million as of
July 27, 2020 due to the completion
of loan renewals. The changes in non-performing assets and
troubled debt restructurings at June 30,
2020, compared to December 31,
2019 and June 30, 2019, are
presented below:
(Dollars in
thousands) (Unaudited)
|
June 30,
2020
|
|
December 31,
2019
|
|
% Change
|
|
June 30,
2019
|
|
% Change
|
Non-performing
assets
|
|
|
|
|
|
|
|
|
|
Accruing loans past
due 90 days or more
|
$
21,374
|
|
$
6,409
|
|
233
|
|
$
14,469
|
|
48
|
Non-accrual
loans:
|
|
|
|
|
|
|
|
|
|
Construction
loans
|
4,433
|
|
4,580
|
|
(3)
|
|
4,702
|
|
(6)
|
Commercial
mortgage loans
|
10,896
|
|
9,928
|
|
10
|
|
14,515
|
|
(25)
|
Commercial
loans
|
27,125
|
|
19,381
|
|
40
|
|
28,070
|
|
(3)
|
Residential
mortgage loans
|
14,004
|
|
6,634
|
|
111
|
|
7,461
|
|
88
|
Total non-accrual
loans:
|
$
56,458
|
|
$
40,523
|
|
39
|
|
$
54,748
|
|
3
|
Total non-performing
loans
|
77,832
|
|
46,932
|
|
66
|
|
69,217
|
|
12
|
Other real
estate owned
|
7,318
|
|
10,244
|
|
(29)
|
|
11,329
|
|
(35)
|
Total non-performing
assets
|
$
85,150
|
|
$
57,176
|
|
49
|
|
$
80,546
|
|
6
|
Accruing troubled
debt restructurings (TDRs)
|
$
31,671
|
|
$
35,336
|
|
(10)
|
|
$
64,898
|
|
(51)
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses
|
$
169,680
|
|
$
123,224
|
|
38
|
|
$
122,651
|
|
38
|
Total gross loans
outstanding, at period-end
|
$
15,608,283
|
|
$
15,075,481
|
|
4
|
|
$
14,593,510
|
|
7
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses to non-performing loans, at period-end
|
218.01%
|
|
262.56%
|
|
|
|
177.20%
|
|
|
Allowance for loan
losses to gross loans, at period-end
|
1.09%
|
|
0.82%
|
|
|
|
0.84%
|
|
|
The ratio of non-performing assets to total assets was 0.4% at
June 30, 2020, compared to 0.3% at
December 31, 2019. Total
non-performing assets increased $28.0
million, or 49.0%, to $85.2
million at June 30, 2020,
compared to $57.2 million at
December 31, 2019, primarily due to
an increase of $15.0 million, or
233.5%, in loans 90 days or more past due and still accruing and an
increase of $15.9 million, or 39.3%,
in nonaccrual loans, offset in part by a decrease of $2.9 million, or 28.6%, in other real estate
owned.
CAPITAL ADEQUACY REVIEW
At June 30, 2020, the Company's
Tier 1 risk-based capital ratio of 12.88%, total risk-based capital
ratio of 14.81%, and Tier 1 leverage capital ratio of 10.46%,
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%. At December 31, 2019, the Company's Tier 1
risk-based capital ratio was 12.51%, total risk-based capital ratio
was 14.11%, and Tier 1 leverage capital ratio was 10.83%.
YEAR-TO-DATE REVIEW
Net income for the six months ended June
30, 2020, was $101.2 million,
a decrease of $37.7 million, or
27.1%, compared to net income of $138.9
million for the same period a year ago. Diluted
earnings per share was $1.27 compared
to $1.73 per share for the same
period a year ago. The net interest margin for the six months
ended June 30, 2020, was 3.17%
compared to 3.64% for the same period a year ago.
Return on average stockholders' equity was 8.72% and return on
average assets was 1.10% for the six months ended June 30, 2020, compared to a return on average
stockholders' equity of 12.92% and a return on average assets of
1.65% for the same period a year ago. The efficiency ratio
for the six months ended June 30,
2020, was 44.71% compared to 44.98% for the same period a
year ago.
CONFERENCE CALL
Cathay General Bancorp will host a conference call to discuss
its second quarter 2020 financial results this afternoon,
Monday, July 27, 2020, 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 1-855-761-3186 and enter
Conference ID 7670941. A presentation to accompany the earnings
call will be available at www.cathaygeneralbancorp.com. 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 38 branches in
California, 10 branches in
New York State, four in
Washington State, three in
Illinois, two in Texas, one in Maryland, Massachusetts, Nevada, and New
Jersey, one in Hong Kong,
and a representative office in Taipei, Beijing, and Shanghai. Cathay Bank's website is found at
www.cathaybank.com. Cathay General Bancorp's website is found 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
(such as the COVID-19 pandemic) 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 including the
implementation of the Dodd-Frank Wall Street Reform and Consumer
Protection Act; 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 (such as the COVID-19 pandemic) 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, 2019 (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.
CATHAY GENERAL
BANCORP
CONSOLIDATED
FINANCIAL HIGHLIGHTS
(Unaudited)
|
|
|
|
Three months
ended
|
|
Six months ended June
30,
|
(Dollars in
thousands, except per share data)
|
|
June 30,
2020
|
|
March 31,
2020
|
|
June 30,
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL
PERFORMANCE
|
|
|
|
|
|
|
|
|
|
|
Net interest income
before provision for credit
losses
|
|
$
134,475
|
|
$
140,311
|
|
$
143,379
|
|
$274,786
|
|
$286,695
|
Provision for credit
losses
|
|
25,000
|
|
25,000
|
|
—
|
|
50,000
|
|
—
|
Net interest income
after provision for credit losses
|
|
109,475
|
|
115,311
|
|
143,379
|
|
224,786
|
|
286,695
|
Non-interest
income
|
|
15,606
|
|
5,786
|
|
12,794
|
|
21,392
|
|
25,715
|
Non-interest
expense
|
|
67,268
|
|
65,154
|
|
69,546
|
|
132,422
|
|
140,516
|
Income before income
tax expense
|
|
57,813
|
|
55,943
|
|
86,627
|
|
113,756
|
|
171,894
|
Income tax
expense
|
|
3,492
|
|
9,091
|
|
14,383
|
|
12,583
|
|
32,971
|
Net income
|
|
$
54,321
|
|
$
46,852
|
|
$
72,244
|
|
$101,173
|
|
$138,923
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common
share
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.68
|
|
$
0.59
|
|
$
0.90
|
|
$
1.27
|
|
$
1.73
|
Diluted
|
|
$
0.68
|
|
$
0.59
|
|
$
0.90
|
|
$
1.27
|
|
$
1.73
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends
paid per common share
|
|
$
0.31
|
|
$
0.31
|
|
$
0.31
|
|
$
0.62
|
|
$
0.62
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED
RATIOS
|
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
1.15%
|
|
1.05%
|
|
1.69%
|
|
1.10%
|
|
1.65%
|
Return on average
total stockholders' equity
|
|
9.31%
|
|
8.12%
|
|
13.27%
|
|
8.72%
|
|
12.92%
|
Efficiency
ratio
|
|
44.82%
|
|
44.60%
|
|
44.53%
|
|
44.71%
|
|
44.98%
|
Dividend payout
ratio
|
|
45.42%
|
|
52.63%
|
|
34.26%
|
|
48.76%
|
|
35.79%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YIELD ANALYSIS
(Fully taxable equivalent)
|
|
|
|
|
|
|
|
|
|
|
Total
interest-earning assets
|
|
3.91%
|
|
4.44%
|
|
4.81%
|
|
4.17%
|
|
4.83%
|
Total
interest-bearing liabilities
|
|
1.20%
|
|
1.49%
|
|
1.65%
|
|
1.34%
|
|
1.60%
|
Net interest
spread
|
|
2.71%
|
|
2.95%
|
|
3.16%
|
|
2.83%
|
|
3.23%
|
Net interest
margin
|
|
3.02%
|
|
3.34%
|
|
3.58%
|
|
3.17%
|
|
3.64%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
RATIOS
|
|
June 30,
2020
|
|
December 31,
2019
|
|
June 30,
2019
|
|
|
|
|
Tier 1 risk-based
capital ratio
|
|
12.88%
|
|
12.51%
|
|
12.26%
|
|
|
|
|
Total risk-based
capital ratio
|
|
14.81%
|
|
14.11%
|
|
13.92%
|
|
|
|
|
Tier 1 leverage
capital ratio
|
|
10.46%
|
|
10.83%
|
|
10.73%
|
|
|
|
|
|
|
.
|
|
|
|
|
|
.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CATHAY GENERAL
BANCORP
CONDENSED
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
(In thousands, except
share and per share data)
|
|
June 30,
2020
|
|
December 31,
2019
|
|
June 30,
2019
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Cash and due from
banks
|
|
$
148,700
|
|
$
177,240
|
|
$
206,123
|
Short-term
investments and interest bearing deposits
|
|
1,425,001
|
|
416,538
|
|
351,603
|
Securities
available-for-sale (amortized cost of $1,122,994 at June 30,
2020,
|
|
|
|
|
|
|
$1,443,730 at December 31, 2019 and $1,468,452 at June 30,
2019)
|
|
1,146,102
|
|
1,451,842
|
|
1,471,584
|
Loans
|
|
15,608,283
|
|
15,075,481
|
|
14,593,510
|
Less: Allowance
for loan losses
|
|
(169,680)
|
|
(123,224)
|
|
(122,651)
|
Unamortized
deferred loan fees, net
|
|
(4,507)
|
|
(626)
|
|
(1,415)
|
Loans,
net
|
|
15,434,096
|
|
14,951,631
|
|
14,469,444
|
Equity
securities
|
|
24,570
|
|
28,005
|
|
32,498
|
Federal Home Loan
Bank stock
|
|
17,250
|
|
18,090
|
|
17,250
|
Other real estate
owned, net
|
|
7,318
|
|
10,244
|
|
11,329
|
Affordable housing
investments and alternative energy partnerships, net
|
|
320,047
|
|
308,681
|
|
301,410
|
Premises and
equipment, net
|
|
104,165
|
|
104,239
|
|
102,919
|
Customers' liability
on acceptances
|
|
10,665
|
|
10,694
|
|
9,616
|
Accrued interest
receivable
|
|
54,326
|
|
53,541
|
|
55,711
|
Goodwill
|
|
372,189
|
|
372,189
|
|
372,189
|
Other intangible
assets, net
|
|
6,030
|
|
6,296
|
|
6,782
|
Right-of-use assets-
operating leases
|
|
34,217
|
|
33,990
|
|
36,515
|
Other
assets
|
|
162,361
|
|
150,924
|
|
161,033
|
Total
assets
|
|
$
19,267,037
|
|
$
18,094,144
|
|
$
17,606,006
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
|
$
3,298,415
|
|
$
2,871,444
|
|
$
2,758,344
|
Interest-bearing
deposits:
|
|
|
|
|
|
|
NOW
deposits
|
|
1,671,290
|
|
1,358,152
|
|
1,267,464
|
Money market
deposits
|
|
2,982,385
|
|
2,260,764
|
|
1,909,097
|
Savings
deposits
|
|
743,982
|
|
758,903
|
|
716,206
|
Time
deposits
|
|
7,585,832
|
|
7,443,045
|
|
7,711,811
|
Total
deposits
|
|
16,281,904
|
|
14,692,308
|
|
14,362,922
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
—
|
|
25,683
|
|
—
|
Advances from the
Federal Home Loan Bank
|
|
230,000
|
|
670,000
|
|
550,000
|
Other borrowings for
affordable housing investments
|
|
32,399
|
|
29,022
|
|
30,820
|
Long-term
debt
|
|
119,136
|
|
119,136
|
|
169,761
|
Deferred payments
from acquisition
|
|
7,753
|
|
7,644
|
|
18,843
|
Acceptances
outstanding
|
|
10,665
|
|
10,694
|
|
9,616
|
Lease liabilities -
operating leases
|
|
36,408
|
|
35,873
|
|
37,858
|
Other
liabilities
|
|
206,324
|
|
209,501
|
|
226,889
|
Total
liabilities
|
|
16,924,589
|
|
15,799,861
|
|
15,406,709
|
Stockholders'
equity
|
|
2,342,448
|
|
2,294,283
|
|
2,199,297
|
Total liabilities and
equity
|
|
$
19,267,037
|
|
$
18,094,144
|
|
$
17,606,006
|
|
|
|
|
|
|
|
Book value per common
share
|
|
$
29.42
|
|
$
28.78
|
|
$
27.55
|
Number of common
shares outstanding
|
|
79,619,984
|
|
79,729,419
|
|
79,818,003
|
CATHAY GENERAL
BANCORP
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
|
|
Three months
ended
|
|
Six months ended June
30,
|
|
|
June 30,
2020
|
March 31,
2020
|
June 30,
2019
|
|
2020
|
2019
|
|
|
(In thousands, except
share and per share data)
|
INTEREST AND
DIVIDEND INCOME
|
|
|
|
|
|
|
|
Loan receivable,
including loan fees
|
|
$
168,149
|
$
177,870
|
$
182,291
|
|
$
346,019
|
$
360,568
|
Investment
securities
|
|
5,405
|
7,610
|
8,477
|
|
13,015
|
15,767
|
Federal Home Loan
Bank stock
|
|
214
|
305
|
298
|
|
519
|
602
|
Deposits with
banks
|
|
240
|
951
|
1,383
|
|
1,191
|
3,273
|
Total interest and
dividend income
|
|
174,008
|
186,736
|
192,449
|
|
360,744
|
380,210
|
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
|
|
|
|
|
|
|
Time
deposits
|
|
30,811
|
35,155
|
39,491
|
|
65,966
|
73,614
|
Other
deposits
|
|
5,919
|
7,991
|
5,588
|
|
13,910
|
10,965
|
Advances from Federal
Home Loan Bank
|
|
1,316
|
1,552
|
1,725
|
|
2,868
|
4,315
|
Long-term
debt
|
|
1,440
|
1,440
|
2,007
|
|
2,880
|
4,139
|
Deferred payments
from acquisition
|
|
42
|
58
|
192
|
|
100
|
409
|
Short-term
borrowings
|
|
5
|
229
|
67
|
|
234
|
73
|
Total interest
expense
|
|
39,533
|
46,425
|
49,070
|
|
85,958
|
93,515
|
|
|
|
|
|
|
|
|
Net interest income
before provision for credit losses
|
|
134,475
|
140,311
|
143,379
|
|
274,786
|
286,695
|
Provision for credit
losses
|
|
25,000
|
25,000
|
-
|
|
50,000
|
-
|
Net interest income
after provision for credit losses
|
|
109,475
|
115,311
|
143,379
|
|
224,786
|
286,695
|
|
|
|
|
|
|
|
|
NON-INTEREST
INCOME
|
|
|
|
|
|
|
|
Net gains/(losses)
from equity securities
|
|
5,779
|
(6,102)
|
3,237
|
|
(323)
|
7,400
|
Securities gains,
net
|
|
1,147
|
6
|
13
|
|
1,153
|
13
|
Letters of credit
commissions
|
|
1,560
|
1,640
|
1,577
|
|
3,200
|
3,131
|
Depository service
fees
|
|
1,117
|
1,298
|
1,243
|
|
2,415
|
2,498
|
Other operating
income
|
|
6,003
|
8,944
|
6,724
|
|
14,947
|
12,673
|
Total non-interest
income
|
|
15,606
|
5,786
|
12,794
|
|
21,392
|
25,715
|
|
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
28,197
|
30,939
|
33,153
|
|
59,136
|
65,285
|
Occupancy
expense
|
|
4,963
|
5,177
|
5,489
|
|
10,140
|
11,038
|
Computer and
equipment expense
|
|
2,581
|
2,593
|
2,833
|
|
5,174
|
5,712
|
Professional services
expense
|
|
5,200
|
5,145
|
6,000
|
|
10,345
|
11,257
|
Data processing
service expense
|
|
3,566
|
3,666
|
3,081
|
|
7,232
|
6,491
|
FDIC and State
assessments
|
|
2,446
|
2,415
|
2,132
|
|
4,861
|
4,608
|
Marketing
expense
|
|
915
|
1,886
|
979
|
|
2,801
|
3,120
|
Other real estate
owned expense/(income)
|
|
452
|
(4,104)
|
369
|
|
(3,652)
|
649
|
Amortization of
investments in low income housing and
alternative energy partnerships
|
|
12,934
|
13,890
|
9,102
|
|
26,824
|
19,912
|
Amortization of core
deposit intangibles
|
|
171
|
172
|
171
|
|
343
|
343
|
Other operating
expense
|
|
5,843
|
3,375
|
6,237
|
|
9,218
|
12,101
|
Total non-interest
expense
|
|
67,268
|
65,154
|
69,546
|
|
132,422
|
140,516
|
|
|
|
|
|
|
|
|
Income before income
tax expense
|
|
57,813
|
55,943
|
86,627
|
|
113,756
|
171,894
|
Income tax
expense
|
|
3,492
|
9,091
|
14,383
|
|
12,583
|
32,971
|
Net income
|
|
$
54,321
|
$
46,852
|
$
72,244
|
|
$
101,173
|
$
138,923
|
Net income per common
share:
|
|
|
|
|
|
|
|
Basic
|
|
$
0.68
|
$
0.59
|
$
0.90
|
|
$
1.27
|
$
1.73
|
Diluted
|
|
$
0.68
|
$
0.59
|
$
0.90
|
|
$
1.27
|
$
1.73
|
|
|
|
|
|
|
|
|
Cash dividends paid
per common share
|
|
$
0.31
|
$
0.31
|
$
0.31
|
|
$
0.62
|
$
0.62
|
Basic average common
shares outstanding
|
|
79,581,097
|
79,588,076
|
80,106,329
|
|
79,584,587
|
80,279,859
|
Diluted average
common shares outstanding
|
|
79,682,426
|
79,830,025
|
80,302,679
|
|
79,756,226
|
80,501,800
|
CATHAY GENERAL
BANCORP
AVERAGE BALANCES –
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(Unaudited)
|
|
|
Three months
ended
|
|
(In
thousands)
|
June 30,
2020
|
|
March 31,
2020
|
|
June 30,
2019
|
Interest-earning
assets
|
Average
Balance
|
Average Yield/Rate
(1)
|
|
Average
Balance
|
Average Yield/Rate
(1)
|
|
Average
Balance
|
Average Yield/Rate
(1)
|
Loans
(1)
|
$15,626,412
|
4.33%
|
|
$15,213,440
|
4.70%
|
|
$14,365,544
|
5.09%
|
Taxable investment
securities
|
1,268,661
|
1.71%
|
|
1,379,365
|
2.22%
|
|
1,441,005
|
2.36%
|
FHLB stock
|
17,434
|
4.95%
|
|
17,268
|
7.09%
|
|
17,250
|
6.93%
|
Deposits with
banks
|
980,949
|
0.10%
|
|
311,024
|
1.23%
|
|
235,019
|
2.36%
|
Total
interest-earning assets
|
$17,893,456
|
3.91%
|
|
$16,921,097
|
4.44%
|
|
$16,058,818
|
4.81%
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$
1,586,112
|
0.19%
|
|
$
1,388,597
|
0.21%
|
|
$
1,265,105
|
0.18%
|
Money market
deposits
|
2,756,493
|
0.72%
|
|
2,437,997
|
1.15%
|
|
1,857,384
|
1.00%
|
Savings
deposits
|
740,500
|
0.14%
|
|
733,372
|
0.18%
|
|
731,512
|
0.20%
|
Time
deposits
|
7,616,446
|
1.63%
|
|
7,495,619
|
1.89%
|
|
7,570,131
|
2.09%
|
Total
interest-bearing deposits
|
$12,699,551
|
1.16%
|
|
$12,055,585
|
1.44%
|
|
$11,424,132
|
1.58%
|
Other borrowed
funds
|
412,953
|
1.33%
|
|
392,029
|
1.89%
|
|
353,799
|
2.25%
|
Long-term
debt
|
119,136
|
4.86%
|
|
119,136
|
4.86%
|
|
169,761
|
4.74%
|
Total
interest-bearing liabilities
|
13,231,640
|
1.20%
|
|
12,566,750
|
1.49%
|
|
11,947,692
|
1.65%
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
3,101,265
|
|
|
2,863,889
|
|
|
2,789,644
|
|
|
|
|
|
|
|
|
|
|
Total deposits and
other borrowed funds
|
$16,332,905
|
|
|
$15,430,639
|
|
|
$14,737,336
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$18,930,651
|
|
|
$18,003,041
|
|
|
$17,157,578
|
|
Total average
equity
|
$
2,346,775
|
|
|
$
2,320,283
|
|
|
$
2,184,251
|
|
|
|
|
|
|
|
|
|
|
|
Six months
ended
|
|
|
|
(In
thousands)
|
June 30,
2020
|
|
June 30,
2019
|
|
|
|
Interest-earning
assets
|
Average
Balance
|
Average Yield/Rate
(1)
|
|
Average
Balance
|
Average Yield/Rate
(1)
|
|
|
|
Loans
(1)
|
$15,419,926
|
4.51%
|
|
$14,227,782
|
5.11%
|
|
|
|
Taxable investment
securities
|
1,324,013
|
1.98%
|
|
1,356,001
|
2.34%
|
|
|
|
FHLB stock
|
17,352
|
6.02%
|
|
17,277
|
7.03%
|
|
|
|
Deposits with
banks
|
645,986
|
0.37%
|
|
275,044
|
2.40%
|
|
|
|
Total
interest-earning assets
|
$17,407,277
|
4.17%
|
|
$15,876,104
|
4.83%
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
Interest-bearing
demand deposits
|
$
1,487,354
|
0.20%
|
|
$
1,286,985
|
0.19%
|
|
|
|
Money market
deposits
|
2,597,245
|
0.92%
|
|
1,886,048
|
0.97%
|
|
|
|
Savings
deposits
|
736,936
|
0.16%
|
|
724,492
|
0.20%
|
|
|
|
Time
deposits
|
7,556,033
|
1.76%
|
|
7,318,590
|
2.03%
|
|
|
|
Total
interest-bearing deposits
|
$12,377,568
|
1.30%
|
|
$11,216,115
|
1.52%
|
|
|
|
Other borrowed
funds
|
402,491
|
1.60%
|
|
407,622
|
2.37%
|
|
|
|
Long-term
debt
|
119,136
|
4.86%
|
|
176,401
|
4.73%
|
|
|
|
Total
interest-bearing liabilities
|
12,899,195
|
1.34%
|
|
11,800,138
|
1.60%
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest-bearing
demand deposits
|
2,982,577
|
|
|
2,782,633
|
|
|
|
|
Total deposits and
other borrowed funds
|
$15,881,772
|
|
|
$14,582,771
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total average
assets
|
$18,466,846
|
|
|
$16,985,370
|
|
|
|
|
Total average
equity
|
$
2,333,529
|
|
|
$
2,167,812
|
|
|
|
|
|
(1) Yields and
interest earned include net loan fees. Non-accrual loans are
included in the average balance.
|
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SOURCE Cathay General Bancorp