CATY Cathay General Bancorp

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Delaware		001-31830		95-4274680
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

	777 North Broadway, Los Angeles, California	90012
	(Address of principal executive offices)	(Zip Code)

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock	CATY	Nasdaq Global Select Market

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Item 2.02

Results of Operations and Financial Condition.

Item 7.01

Regulation FD Disclosure.

Item 9.01

Financial Statements and Exhibits.

(d)

Exhibits

99.1

Press Release of Cathay General Bancorp, dated October 21, 2024

99.2

Presentation Materials, dated October 21, 2024

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

	CATHAY GENERAL BANCORP
	By:	/s/ Heng W. Chen
		Heng W. Chen Executive Vice President and Chief Financial Officer

Exhibit 99.1

 

FOR IMMEDIATE RELEASE                  

 

 

For:	Cathay General Bancorp	Contact: Heng W. Chen
	777 N. Broadway	(626) 279-3652
	Los Angeles, CA 90012

 

 

Cathay General Bancorp Announces Third Quarter 2024 Results

 

Los Angeles, Calif., October 21, 2024: Cathay General Bancorp (the “Company”, “we”, “us”, or “our”) (Nasdaq: CATY), the holding company for Cathay Bank, today announced its unaudited financial results for the quarter ended September 30, 2024. The Company reported net income of $67.5 million, or $0.94 per diluted share, for the third quarter of 2024.

 

FINANCIAL PERFORMANCE

 

		Three months ended
(unaudited)		September 30, 2024				June 30, 2024				September 30, 2023
Net income		$ 67.5 million				$ 66.8 million				$ 82.4 million
Basic earnings per common share			$0.94				$0.92				$1.14
Diluted earnings per common share			$0.94				$0.92				$1.13
Return on average assets			1.15	%			1.15	%			1.42	%
Return on average total stockholders' equity			9.50	%			9.63	%			12.36	%
Efficiency ratio			51.11	%			55.65	%			48.57	%

 

THIRD QUARTER HIGHLIGHTS

 

●	Net interest margin increased to 3.04% in the third quarter of 2024 from 3.01% in the second quarter of 2024.

●	Diluted earnings per share increased to $0.94 for the third quarter of 2024 compared to $0.92 for the second quarter of 2024.

●	Total deposits increased by $170.9 million, or 3.5% annualized, to $19.94 billion in the third quarter of 2024.

 

We are pleased to see the increase in the net interest margin compared to the second quarter. During the third quarter, we repurchased 0.8 million shares at an average cost of $42.0 per share, for a total of $35.0 million.”, commented Chang M. Liu, President and Chief Executive Officer of the Company.

 

 

INCOME STATEMENT REVIEW

THIRD QUARTER 2024 COMPARED TO THE SECOND QUARTER 2024

 

Net income for the quarter ended September 30, 2024, was $67.5 million, an increase of $0.7 million, or 1.0%, compared to net income of $66.8 million for the second quarter of 2024. Diluted earnings per share for the third quarter of 2024 was $0.94 per share compared to $0.92 per share for the second quarter of 2024. The third quarter net income included $2.2 million after-tax or $0.03 per diluted share in higher income tax expense related to 2023 low-income housing tax credits discrete item.

 

Return on average stockholders’ equity was 9.50% and return on average assets was 1.15% for the quarter ended September 30, 2024, compared to a return on average stockholders’ equity of 9.63% and a return on average assets of 1.15% in the second quarter of 2024.

 

Net interest income before provision for credit losses

 

Net interest income before provision for credit losses increased $3.9 million, or 2.4%, to $169.2 million during the third quarter of 2024, compared to $165.3 million in the second quarter of 2024. The increase was due primarily to an increase in interest income from loans offset, in part, by an increase in deposit interest expense.

 

The net interest margin was 3.04% for the third quarter of 2024 compared to 3.01% for the second quarter of 2024.

 

For the third quarter of 2024, the yield on average interest-earning assets was 6.10%, the cost of funds on average interest-bearing liabilities was 3.99%, and the cost of interest-bearing deposits was 3.95%. In comparison, for the second quarter of 2024, the yield on average interest-earning assets was 6.05%, the cost of funds on average interest-bearing liabilities was 3.97%, and the cost of interest-bearing deposits was 3.94%. The increase in the costs of average interest-bearing liabilities was mainly a result of higher interest rates on interest bearing deposits. The net interest spread, defined as the difference between the yield on average interest-earning assets and the cost of funds on average interest-bearing liabilities, was 2.11% for the third quarter of 2024, compared to 2.08% for the second quarter of 2024.

 

Provision for credit losses

 

The Company recorded a provision for credit losses of $14.5 million in the third quarter of 2024 compared with $6.6 million in the second quarter of 2024. As of September 30, 2024, the allowance for credit losses, which is comprised of the reserve for loan losses and the reserve for unfunded loan commitments, increased $10.2 million to $173.2 million, or 0.89% of gross loans, compared to $163.0 million, or 0.84% of gross loans, as of June 30, 2024.

 

 

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

 

		Three months ended												Nine months ended September 30,
		September 30, 2024				June 30, 2024				September 30, 2023				2024				2023
		(In thousands) (Unaudited)
Charge-offs:
Commercial loans		$	2,666			$	8,257			$	6,254			$	12,862			$	12,517
Real estate loans (1)			1,805				—				1,221				2,059				5,341
Installment and other loans			7				—				8				7				15
Total charge-offs			4,478				8,257				7,483				14,928				17,873
Recoveries:
Commercial loans			88				126				611				1,026				1,564
Real estate loans (1)			186				134				261				561				2,862
Installment and other loans			1				—				—				1				—
Total recoveries			275				260				872				1,588				4,426
Net charge-offs		$	4,203			$	7,997			$	6,611			$	13,340			$	13,447

 

(1)

Real estate loans include commercial real estate 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), wealth management fees, and other sources of fee income, was $20.4 million for the third quarter of 2024, an increase of $7.2 million, or 54.5%, compared to $13.2 million for the second quarter of 2024. The increase was primarily due to a $5.7 million increase in unrealized gains on equity securities when compared to the second quarter of 2024.

 

Non-interest expense

 

Non-interest expense decreased $2.5 million, or 2.5%, to $96.9 million in the third quarter of 2024 compared to $99.4 million in the second quarter of 2024. The decrease in non-interest expense in the third quarter of 2024 was primarily due to a decrease of $1.2 million in professional services, when compared to the second quarter of 2024. The efficiency ratio, defined as non-interest expense divided by the sum of net interest income before provision for loan losses plus non-interest income, was 51.11% in the third quarter of 2024 compared to 55.65% for the second quarter of 2024.

 

Income taxes

 

The effective tax rate for the third quarter of 2024 was 13.61% compared to 7.92% for the second quarter of 2024. The effective tax rate includes the impact of alternative energy investments and low-income housing tax credits. Income tax expense in the third quarter included a $2.2 million discrete item for 2023 low-income housing tax credits.

 

 

BALANCE SHEET REVIEW

 

Gross loans, excluding loans held for sale, were $19.37 billion as of September 30, 2024, an increase of $16.1 million, or 0.1%, from $19.36 billion as of June 30, 2024. The increase was primarily due to an increase of $89.2 million, or 0.9%, in commercial real estate loans, and an increase of $16.2 million, or 0.5% in commercial loans offset, in part, by a decrease of $49.9 million, or 14.0% in construction loans, a decrease of $31.7 million, or 0.5%, in residential mortgage loans and a decrease of $8.4 million, or 3.6% in equity lines.

 

The loan balances and composition as of September 30, 2024, compared to June 30, 2024, and September 30, 2023, are presented below:

 

		September 30, 2024				June 30, 2024				September 30, 2023
		(In thousands) (Unaudited)
Commercial loans		$	3,106,994			$	3,090,763			$	3,090,609
Construction loans			307,057				356,978				474,294
Commercial real estate loans			9,975,272				9,886,030				9,511,805
Residential mortgage loans			5,750,546				5,782,202				5,685,844
Equity lines			226,838				235,277				253,826
Installment and other loans			6,886				6,274				7,444
Gross loans		$	19,373,593			$	19,357,524			$	19,023,822
Allowance for loan losses			(163,733	)			(153,404	)			(154,619	)
Unamortized deferred loan fees			(10,505	)			(10,785	)			(9,521	)
Total loans, net		$	19,199,355			$	19,193,335			$	18,859,682
Loans held for sale		$	5,190			$	—			$	—

 

Total deposits were $19.94 billion as of September 30, 2024, an increase of $170.9 million, or 0.9%, from $19.77 billion as of June 30, 2024.

 

The deposit balances and composition as of September 30, 2024, compared to June 30, 2024, and September 30, 2023, are presented below:

 

		September 30, 2024				June 30, 2024				September 30, 2023
		(In thousands) (Unaudited)
Non-interest-bearing demand deposits		$	3,253,823			$	3,161,632			$	3,623,483
NOW deposits			2,093,861				2,145,580				2,454,878
Money market deposits			3,134,460				3,182,031				3,222,612
Savings deposits			1,215,974				1,014,287				1,131,352
Time deposits			10,245,823				10,269,487				9,203,263
Total deposits		$	19,943,941			$	19,773,017			$	19,635,588

 

 

ASSET QUALITY REVIEW

 

As of September 30, 2024, total non-accrual loans were $162.8 million, an increase of $55.5 million, or 51.7%, from $107.3 million as of June 30, 2024.

 

The allowance for loan losses was $163.7 million and the allowance for off-balance sheet unfunded credit commitments was $9.5 million as of September 30, 2024. The allowances represent the amount estimated by management to be appropriate to absorb expected credit losses inherent in the loan portfolio, including unfunded credit commitments. The allowance for loan losses represented 0.85% of period-end gross loans, and 96.45% of non-performing loans as of September 30, 2024. The comparable ratios were 0.79% of period-end gross loans, and 138.56% of non-performing loans as of June 30, 2024.

 

The changes in non-performing assets and modifications to borrowers experiencing financial difficulties as of September 30, 2024, compared to June 30, 2024, and September 30, 2023, are presented below:

 

(Dollars in thousands) (Unaudited)		September 30, 2024				June 30, 2024				% Change				September 30, 2023				% Change
Non-performing assets
Accruing loans past due 90 days or more		$	6,931			$	3,443				101			$	1,924				260
Non-accrual loans:
Construction loans			—				22,998				(100	)			16,992				(100)
Commercial real estate loans			87,577				60,085				46				32,539				169
Commercial loans *			52,074				4,075				1,178				14,661				255
Residential mortgage loans			23,183				20,112				15				13,138				76
Total non-accrual loans		$	162,834			$	107,270				52			$	77,330				111
Total non-performing loans			169,765				110,713				53				79,254				114
Other real estate owned			18,277				18,277				—				14,407				27
Total non-performing assets		$	188,042			$	128,990				46			$	93,661				101
Allowance for loan losses		$	163,733			$	153,404				7			$	154,619				6
Total gross loans outstanding, at period-end		$	19,373,593			$	19,357,524				0			$	19,023,822				2
Allowance for loan losses to non-performing loans, at period-end			96.45	%			138.56	%							195.09	%
Allowance for loan losses to gross loans, at period-end			0.85	%			0.79	%							0.81	%

 

*

Commercial nonaccrual loans included $19.5 million of loans that are current.

 

The increase in our nonaccrual loans was primarily caused by a $38.1 million loan relationship that was placed on nonaccrual status due to interest delinquency of more than ninety days on $18.6 million of these loans. The remaining $19.5 million of loans in this relationship were still current as of September 30, 2024. The borrower is actively seeking financing elsewhere for these loans.

 

The ratio of non-performing assets to total assets was 0.81% as of September 30, 2024, compared to 0.56% as of June 30, 2024. Total non-performing assets increased $59.0 million, or 45.7%, to $188.0 million as of September 30, 2024, compared to $129.0 million as of June 30, 2024, primarily due to an increase of $55.5 million, or 51.7%, in non-accrual loans, and an increase of $3.5 million, or 101.3%, in accruing loans past due 90 days or more.

 

CAPITAL ADEQUACY REVIEW

 

As of September 30, 2024, the Company’s Tier 1 risk-based capital ratio of 13.33%, total risk-based capital ratio of 14.88%, and Tier 1 leverage capital ratio of 10.82%, calculated under the Basel III capital rules, continue to place the Company in the “well capitalized” category for regulatory purposes, which is defined as institutions with a Tier 1 risk-based capital ratio equal to or greater than 8%, a total risk-based capital ratio equal to or greater than 10%, and a Tier 1 leverage capital ratio equal to or greater than 5%. As of June 30, 2024, the Company’s Tier 1 risk-based capital ratio was 13.26%, total risk-based capital ratio was 14.74%, and Tier 1 leverage capital ratio was 10.83%.

 

 

YEAR-TO-DATE REVIEW

 

Net income for the nine months ended September 30, 2024, was $205.8 million, a decrease of $65.8 million, or 24.2%, compared to net income of $271.6 million for the same period a year ago. Diluted earnings per share was $2.83 compared to $3.73 per share for the same period a year ago. The net interest margin for the nine months ended September 30, 2024, was 3.03% compared to 3.52% for the same period a year ago.

 

Return on average stockholders’ equity was 9.84% and return on average assets was 1.18% for the nine months ended September 30, 2024, compared to a return on average stockholders’ equity of 14.04% and a return on average assets of 1.61% for the same period a year ago. The efficiency ratio for the nine months ended September 30, 2024, was 53.28% compared to 44.64% for the same period a year ago.

 

CONFERENCE CALL

 

Cathay General Bancorp will host a conference call to discuss its third quarter 2024 financial results this afternoon, Monday, October 21, 2024, at 3:00 p.m., Pacific Time. Analysts and investors may dial in and participate in the question-and-answer session. To access the call, please dial 1-833-816-1377 and refer to Conference Code 10193436. The presentation accompanying this call and access to the live webcast is available on our site at www.cathaygeneralbancorp.com and a replay of the webcast will be archived for one year within 24 hours after the event.

 

ABOUT CATHAY GENERAL BANCORP

 

Cathay General Bancorp is a publicly traded company (Nasdaq: CATY) and is the holding company for Cathay Bank, a California state-chartered bank. Founded in 1962, Cathay Bank offers a wide range of financial services and currently operate over 60 branches across the United States in California, New York, Washington, Texas, Illinois, Massachusetts, Maryland, Nevada, and New Jersey. Overseas, it has a branch outlet in Hong Kong, and a representative office in Beijing, Shanghai, and Taipei. To learn more about Cathay Bank, please visit www.cathaybank.com. Cathay General Bancorp’s website is at www.cathaygeneralbancorp.com. Information set forth on such websites is not incorporated into this press release.

 

 

FORWARD-LOOKING STATEMENTS

 

Statements made in this press release, other than statements of historical fact, are forward-looking statements within the meaning of the applicable provisions of the Private Securities Litigation Reform Act of 1995 regarding management’s beliefs, projections, and assumptions concerning future results and events. These forward-looking statements may include, but are not limited to, such words as “aims,” “anticipates,” “believes,” “can,” “continue,” “could,” “estimates,” “expects,” “hopes,” “intends,” “may,” “plans,” “projects,” “predicts,” “potential,” “possible,” “optimistic,” “seeks,” “shall,” “should,” “will,” and variations of these words and similar expressions. Forward-looking statements are based on estimates, beliefs, projections, and assumptions of management and are not guarantees of future performance. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or projections. Such risks and uncertainties and other factors include, but are not limited to, adverse developments or conditions related to or arising from local, regional, national and international business, market and economic conditions and events and the impact they may have on us, our customers and our operations, assets and liabilities; possible additional provisions for loan losses and charge-offs; credit risks of lending activities and deterioration in asset or credit quality; extensive laws and regulations and supervision that we are subject to including potential future supervisory action by bank supervisory authorities; increased costs of compliance and other risks associated with changes in regulation; higher capital requirements from the implementation of the Basel III capital standards; compliance with the Bank Secrecy Act and other money laundering statutes and regulations; potential goodwill impairment; liquidity risk; fluctuations in interest rates; risks associated with acquisitions and the expansion of our business into new markets; inflation and deflation; real estate market conditions and the value of real estate collateral; our ability to generate anticipated returns on our investments and financings, including in tax-advantaged projects; environmental liabilities; our ability to compete with larger competitors; our ability to retain key personnel; successful management of reputational risk; natural disasters, public health crises and geopolitical events; general economic or business conditions in Asia, and other regions where Cathay Bank has operations; failures, interruptions, or security breaches of our information systems; our ability to adapt our systems to technological changes; risk management processes and strategies; adverse results in legal proceedings; certain provisions in our charter and bylaws that may affect acquisition of the Company; changes in accounting standards or tax laws and regulations; market disruption and volatility; restrictions on dividends and other distributions by laws and regulations and by our regulators and our capital structure; issuance of preferred stock; successfully raising additional capital, if needed, and the resulting dilution of interests of holders of our common stock; the soundness of other financial institutions; and general competitive, economic political, and market conditions and fluctuations.

 

These and other factors are further described in Cathay General Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2023 (Item 1A in particular), other reports filed with the Securities and Exchange Commission (“SEC”), and other filings Cathay General Bancorp makes with the SEC from time to time. Actual results in any future period may also vary from the past results discussed in this press release. Given these risks and uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, we undertake no obligation to update or review any forward-looking statement to reflect circumstances, developments or events occurring after the date on which the statement is made or to reflect the occurrence of unanticipated events.     

    

 

CATHAY GENERAL BANCORP

 

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

 

		Three months ended												Nine months ended September 30,
(Dollars in thousands, except per share data)		September 30, 2024				June 30, 2024				September 30, 2023				2024				2023
Financial performance
Net interest income before provision for credit losses		$	169,155			$	165,316			$	185,640			$	503,043			$	559,608
Provision for credit losses			14,500				6,600				7,000				23,000				24,255
Net interest income after provision for credit losses			154,655				158,716				178,640				480,043				535,353
Non-interest income			20,365				13,215				7,837				40,191				45,191
Non-interest expense			96,867				99,352				93,973				289,458				269,980
Income before income tax expense			78,153				72,579				92,504				230,776				310,564
Income tax expense			10,639				5,750				10,133				24,998				38,966
Net income		$	67,514			$	66,829			$	82,371			$	205,778			$	271,598
Net income per common share
Basic		$	0.94			$	0.92			$	1.14			$	2.84			$	3.74
Diluted		$	0.94			$	0.92			$	1.13			$	2.83			$	3.73
Cash dividends paid per common share		$	0.34			$	0.34			$	0.34			$	1.02			$	1.02
Selected ratios
Return on average assets			1.15	%			1.15	%			1.42	%			1.18	%			1.61	%
Return on average total stockholders’ equity			9.50	%			9.63	%			12.36	%			9.84	%			14.04	%
Efficiency ratio			51.11	%			55.65	%			48.57	%			53.28	%			44.64	%
Dividend payout ratio			36.04	%			37.06	%			29.95	%			35.87	%			27.22	%
Yield analysis (Fully taxable equivalent)
Total interest-earning assets			6.10	%			6.05	%			5.89	%			6.05	%			5.71	%
Total interest-bearing liabilities			3.99	%			3.97	%			3.33	%			3.95	%			2.94	%
Net interest spread			2.11	%			2.08	%			2.56	%			2.10	%			2.77	%
Net interest margin			3.04	%			3.01	%			3.38	%			3.03	%			3.52	%

 

Capital ratios		September 30, 2024				June 30, 2024				September 30, 2023
Tier 1 risk-based capital ratio			13.33	%			13.26	%			12.70	%
Total risk-based capital ratio			14.88	%			14.74	%			14.21	%
Tier 1 leverage capital ratio			10.82	%			10.83	%			10.44	%

 

 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(In thousands, except share and per share data)		September 30, 2024				June 30, 2024				September 30, 2023
Assets
Cash and due from banks		$	182,542			$	160,389			$	145,580
Short-term investments and interest bearing deposits			1,156,223				944,612				1,017,354
Securities available-for-sale (amortized cost of $1,602,696 at September 30, 2024, $1,780,251 at June 30, 2024 and $1,684,951 at September 30, 2023)			1,508,356				1,648,731				1,508,798
Loans held for sale			5,190				—				—
Loans			19,373,593				19,357,524				19,023,822
Less:  Allowance for loan losses			(163,733	)			(153,404	)			(154,619	)
Unamortized deferred loan fees, net			(10,505	)			(10,785	)			(9,521	)
Loans, net			19,199,355				19,193,335				18,859,682
Equity securities			35,741				29,949				31,456
Federal Home Loan Bank stock			17,250				17,250				17,250
Other real estate owned, net			18,277				18,277				14,407
Affordable housing investments and alternative energy partnerships, net			280,091				309,834				332,903
Premises and equipment, net			89,158				89,451				91,033
Customers’ liability on acceptances			12,043				16,264				16,900
Accrued interest receivable			95,351				99,434				90,875
Goodwill			375,696				375,696				375,696
Other intangible assets, net			3,590				3,860				4,725
Right-of-use assets- operating leases			30,543				32,858				30,586
Other assets			265,037				295,305				307,284
Total assets		$	23,274,443			$	23,235,245			$	22,844,529
Liabilities and Stockholders’ Equity
Deposits:
Non-interest-bearing demand deposits		$	3,253,823			$	3,161,632			$	3,623,483
Interest-bearing deposits:
NOW deposits			2,093,861				2,145,580				2,454,878
Money market deposits			3,134,460				3,182,031				3,222,612
Savings deposits			1,215,974				1,014,287				1,131,352
Time deposits			10,245,823				10,269,487				9,203,263
Total deposits			19,943,941				19,773,017				19,635,588
Advances from the Federal Home Loan Bank			60,000				165,000				15,000
Other borrowings for affordable housing investments			17,783				17,838				22,374
Long-term debt			119,136				119,136				119,136
Acceptances outstanding			12,043				16,264				16,900
Lease liabilities - operating leases			32,906				35,355				32,962
Other liabilities			258,321				315,393				363,833
Total liabilities			20,444,130				20,442,003				20,205,793
Stockholders' equity			2,830,313				2,793,242				2,638,736
Total liabilities and equity		$	23,274,443			$	23,235,245			$	22,844,529
Book value per common share		$	39.66			$	38.70			$	36.35
Number of common shares outstanding			71,355,869				72,170,433				72,586,992

 

 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

		Three months ended												Nine months ended September 30,
		September 30, 2024				June 30, 2024				September 30, 2023				2024				2023
		(In thousands, except share and per share data)
Interest and Dividend Income
Loans receivable		$	310,311			$	303,336			$	293,108			$	916,175			$	827,765
Investment securities			15,125				15,644				12,698				45,720				36,832
Federal Home Loan Bank stock			375				499				355				1,305				957
Deposits with banks			13,680				13,381				17,307				41,793				43,405
Total interest and dividend income			339,491				332,860				323,468				1,004,993				908,959
Interest Expense
Time deposits			119,786				118,076				90,022				347,408				234,171
Other deposits			45,918				44,512				38,207				133,218				92,683
Advances from Federal Home Loan Bank			1,885				2,316				6,779				13,517				14,875
Long-term debt			2,351				1,863				1,726				5,935				4,721
Short-term borrowings			396				777				1,094				1,872				2,901
Total interest expense			170,336				167,544				137,828				501,950				349,351
Net interest income before provision for credit losses			169,155				165,316				185,640				503,043				559,608
Provision for credit losses			14,500				6,600				7,000				23,000				24,255
Net interest income after provision for credit losses			154,655				158,716				178,640				480,043				535,353
Non-Interest Income
Net gains/(losses) from equity securities			4,253				(1,430	)			(6,218	)			(6,204	)			9,298
Debt securities gains/(losses), net			—				—				—				1,107				(3,000	)
Letters of credit commissions			2,081				1,888				1,738				5,686				4,972
Depository service fees			1,572				1,778				1,536				4,900				5,009
Wealth management fees			6,545				5,678				5,150				17,861				12,686
Other operating income			5,914				5,301				5,631				16,841				16,226
Total non-interest income			20,365				13,215				7,837				40,191				45,191
Non-Interest Expense
Salaries and employee benefits			40,859				40,439				38,774				124,850				114,048
Occupancy expense			5,938				5,652				5,851				17,557				16,883
Computer and equipment expense			4,753				5,391				4,387				15,212				12,899
Professional services expense			7,021				8,212				7,906				22,225				24,212
Data processing service expense			4,330				3,877				3,614				12,136				11,010
FDIC and State assessments			3,250				3,742				3,063				13,081				9,230
Marketing expense			1,614				1,474				1,587				5,002				4,777
Other real estate owned expense			596				1,482				435				2,331				566
Amortization of investments in low income housing and alternative energy partnerships			24,077				23,396				23,157				61,905				60,497
Amortization of core deposit intangibles			250				259				250				848				1,059
Other operating expense			4,179				5,428				4,949				14,311				14,799
Total non-interest expense			96,867				99,352				93,973				289,458				269,980
Income before income tax expense			78,153				72,579				92,504				230,776				310,564
Income tax expense			10,639				5,750				10,133				24,998				38,966
Net income		$	67,514			$	66,829			$	82,371			$	205,778			$	271,598
Net income per common share:
Basic		$	0.94			$	0.92			$	1.14			$	2.84			$	3.74
Diluted		$	0.94			$	0.92			$	1.13			$	2.83			$	3.73
Cash dividends paid per common share		$	0.34			$	0.34			$	0.34			$	1.02			$	1.02
Basic average common shares outstanding			71,786,624				72,658,810				72,568,518				72,370,995				72,546,149
Diluted average common shares outstanding			72,032,456				72,825,356				72,890,414				72,607,550				72,847,907

 

 

CATHAY GENERAL BANCORP

AVERAGE BALANCES – SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited)

 

		Three months ended
(In thousands)(Unaudited)		September 30, 2024								June 30, 2024								September 30, 2023
Interest-earning assets:		Average Balance				Average Yield/Rate (1)				Average Balance				Average Yield/Rate (1)				Average Balance				Average Yield/Rate (1)
Loans (1)		$	19,455,540				6.35	%		$	19,439,112				6.28	%		$	18,959,444				6.13	%
Taxable investment securities			1,638,414				3.67	%			1,667,279				3.77	%			1,530,767				3.29	%
FHLB stock			17,250				8.65	%			17,250				11.63	%			19,141				7.35	%
Deposits with banks			1,035,534				5.26	%			997,808				5.39	%			1,273,751				5.39	%
Total interest-earning assets		$	22,146,738				6.10	%		$	22,121,449				6.05	%		$	21,783,103				5.89	%
Interest-bearing liabilities:
Interest-bearing demand deposits		$	2,134,807				2.10	%		$	2,169,045				2.07	%		$	2,405,011				1.98	%
Money market deposits			3,073,384				3.75	%			3,217,813				3.77	%			3,036,445				2.98	%
Savings deposits			1,212,870				1.85	%			1,037,771				1.23	%			1,151,615				1.17	%
Time deposits			10,250,601				4.65	%			10,185,497				4.66	%			9,145,176				3.91	%
Total interest-bearing deposits		$	16,671,662				3.95	%		$	16,610,126				3.94	%		$	15,738,247				3.23	%
Other borrowed funds			186,838				4.86	%			235,234				5.29	%			586,824				5.32	%
Long-term debt			119,136				7.85	%			119,136				6.29	%			119,136				5.75	%
Total interest-bearing liabilities			16,977,636				3.99	%			16,964,496				3.97	%			16,444,207				3.33	%
Non-interest-bearing demand deposits			3,230,150								3,247,498								3,603,779
Total deposits and other borrowed funds		$	20,207,786							$	20,211,994							$	20,047,986
Total average assets		$	23,353,032							$	23,336,454							$	22,997,427
Total average equity		$	2,828,386							$	2,792,557							$	2,644,006

 

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

 

		Nine months ended
(In thousands)(Unaudited)		September 30, 2024								September 30, 2023
Interest-earning assets:		Average Balance				Average Yield/Rate (1)				Average Balance				Average Yield/Rate (1)
Loans (1)		$	19,464,502				6.29	%		$	18,572,222				5.96	%
Taxable investment securities			1,647,968				3.71	%			1,546,951				3.18	%
FHLB stock			19,162				9.10	%			18,290				7.00	%
Deposits with banks			1,042,413				5.36	%			1,145,398				5.07	%
Total interest-earning assets		$	22,174,045				6.05	%		$	21,282,861				5.71	%
Interest-bearing liabilities:
Interest-bearing demand deposits		$	2,205,108				2.12	%		$	2,361,732				1.57	%
Money market deposits			3,134,940				3.69	%			3,152,703				2.51	%
Savings deposits			1,099,331				1.42	%			1,056,234				0.73	%
Time deposits			10,053,062				4.62	%			8,728,133				3.59	%
Total interest-bearing deposits		$	16,492,441				3.89	%		$	15,298,802				2.86	%
Other borrowed funds			383,563				5.36	%			473,114				5.02	%
Long-term debt			119,136				6.65	%			119,136				5.30	%
Total interest-bearing liabilities			16,995,140				3.95	%			15,891,052				2.94	%
Non-interest-bearing demand deposits			3,271,913								3,741,982
Total deposits and other borrowed funds		$	20,267,053							$	19,633,034
Total average assets		$	23,380,362							$	22,053,114
Total average equity		$	2,794,387							$	2,586,548

 

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

 

 

CATHAY GENERAL BANCORP

GAAP to NON-GAAP RECONCILIATION

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited)

 

The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company’s performance. Tangible equity and tangible equity to tangible assets ratio are non-GAAP financial measures. Tangible equity and tangible assets represent stockholders’ equity and total assets, respectively, which have been reduced by goodwill and other intangible assets. Given that the use of such measures and ratios is more prevalent in the banking industry, and such measures and ratios are used by banking regulators and analysts, the Company has included them below for discussion.

 

			As of
			September 30, 2024				June 30, 2024				September 30, 2023
			(In thousands) (Unaudited)
Stockholders' equity	(a)		$	2,830,313			$	2,793,242			$	2,638,736
Less: Goodwill				(375,696	)			(375,696	)			(375,696	)
Other intangible assets (1)				(3,590	)			(3,860	)			(4,725	)
Tangible equity	(b)		$	2,451,027			$	2,413,686			$	2,258,315
Total assets	(c)		$	23,274,443			$	23,235,245			$	22,844,529
Less: Goodwill				(375,696	)			(375,696	)			(375,696	)
Other intangible assets (1)				(3,590	)			(3,860	)			(4,725	)
Tangible assets	(d)		$	22,895,157			$	22,855,689			$	22,464,108
Number of common shares outstanding	(e)			71,355,869				72,170,433				72,586,992
Total stockholders' equity to total assets ratio	(a)/(c)			12.16	%			12.02	%			11.55	%
Tangible equity to tangible assets ratio	(b)/(d)			10.71	%			10.56	%			10.05	%
Tangible book value per share	(b)/(e)		$	34.35			$	33.44			$	31.11

 

			Three months ended												Nine months ended
			September 30, 2024				June 30, 2024				September 30, 2023				September 30, 2024				September 30, 2023
			(In thousands) (Unaudited)
Net Income			$	67,514			$	66,829			$	82,371			$	205,778			$	271,598
Add: Amortization of other intangibles (1)				264				270				270				863				1,031
Tax effect of amortization adjustments (2)				(78	)			(80	)			(80	)			(256	)			(306	)
Tangible net income	(f)		$	67,700			$	67,019			$	82,561			$	206,385			$	272,323
Return on tangible common equity (3)	(f)/(b)			11.05	%			11.11	%			14.62	%			11.23	%			16.08	%

 

⁽¹⁾  Includes core deposit intangibles and mortgage servicing 

⁽²⁾  Applied the statutory rate of 29.65%.

⁽³⁾  Annualized

 

Exhibit 99.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

v3.24.3

Document And Entity Information	Oct. 21, 2024
Document Information [Line Items]
Entity, Registrant Name	CATHAY GENERAL BANCORP
Document, Type	8-K
Document, Period End Date	Oct. 21, 2024
Entity, Incorporation, State or Country Code	DE
Entity, File Number	001-31830
Entity, Tax Identification Number	95-4274680
Entity, Address, Address Line One	777 North Broadway
Entity, Address, City or Town	Los Angeles
Entity, Address, State or Province	CA
Entity, Address, Postal Zip Code	90012
City Area Code	213
Local Phone Number	625-4700
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common stock
Trading Symbol	CATY
Security Exchange Name	NASDAQ
Entity, Emerging Growth Company	false
Amendment Flag	false
Entity, Central Index Key	0000861842

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