Cathay General Bancorp Announces Fourth Quarter and Full Year 2018 Results

LOS ANGELES, Jan. 23, 2019 /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 and year ended December 31, 2018.  The Company reported net income of $64.9 million, or $0.80 per share, for the fourth quarter of 2018, and net income of $272.2 million, or $3.34 per share, for the year ended December 31, 2018.

Cathay General Bancorp (PRNewsFoto/Cathay General Bancorp) (PRNewsfoto/Cathay General Bancorp)

FINANCIAL PERFORMANCE


Three months ended


Year ended December 31,


December 31, 2018


September 30, 2018


December 31, 2017


2018


2017

Net income

$64.9 million


$69.8 million


$25.9 million


$272.2 million


$176.0 million

Basic earnings per common share

$0.80


$0.86


$0.32


$3.35


$2.19

Diluted earnings per common share

$0.80


$0.85


$0.32


$3.34


$2.17

Return on average assets

1.57%


1.72%


0.66%


1.70%


1.19%

Return on average total stockholders' equity

12.13%


13.19%


5.18%


13.19%


9.10%

Efficiency ratio

47.16%


43.14%


46.27%


44.13%


44.40%

FULL YEAR HIGHLIGHTS

  • Total loans increased for the year by $1.1 billion, or 8.5%, to $14.0 billion from $12.9 billion in 2017.
  • Net interest margin for 2018 increased to 3.79% compared to 3.63% in 2017.

"We reported record net income of $272.2 million and record EPS of $3.34 in 2018.  Strong loan growth of $1.1 billion in 2018 or 8.5% was a major contributor to the record results. In light of recent stock market weakness, we resumed our stock buyback program and repurchased 1.1 million shares of our common stock at an average price of $38.25," commented Pin Tai, Chief Executive Officer and President of the Company. 

FOURTH QUARTER INCOME STATEMENT REVIEW

Net income for the quarter ended December 31, 2018, was $64.9 million, an increase of $39.0 million, or 150.6%, compared to net income of $25.9 million for the same quarter a year ago, which included $22.3 million of additional tax expense related to the revaluation of the Company's deferred tax assets and a $2.6 million pretax write-down of low income housing tax credit investments as a result of the enactment of the Tax Cuts and Jobs Act.  Diluted earnings per share for the quarter ended December 31, 2018, was $0.80 compared to $0.32 for the same quarter a year ago.  Net income for the quarter ended December 31, 2018 included a $6.2 million increase in amortization expense of investments in low income housing and alternative energy partnerships and a decrease of $1.9 million in income from other real estate owned compared to the same quarter in prior year.

Return on average stockholders' equity was 12.1% and return on average assets was 1.57% for the quarter ended December 31, 2018, compared to a return on average stockholders' equity of 5.18% and a return on average assets of 0.66% for the same quarter a year ago.    

Net interest income before provision for credit losses

Net interest income before provision for credit losses increased $12.1 million, or 9.1%, to $145.4 million during the fourth quarter of 2018, compared to $133.3 million during the same quarter a year ago.  The increase was due primarily to an increase in interest income from loans and securities, offset by increases in interest expense from time deposits.

The net interest margin was 3.77% for the fourth quarter of 2018 compared to 3.65% for the fourth quarter of 2017 and 3.83% for the third quarter of 2018. 

For the fourth quarter of 2018, the yield on average interest-earning assets was 4.76%, the cost of funds on average interest-bearing liabilities was 1.36%, and the cost of interest-bearing deposits was 1.29%.  In comparison, for the fourth quarter of 2017, the yield on average interest-earning assets was 4.27%, the cost of funds on average interest-bearing liabilities was 0.84%, and the cost of interest-bearing deposits was 0.73%. The increase in the yield on average interest-earning assets resulted mainly from higher 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 3.40% for the quarter ended December 31, 2018, compared to 3.43% for the same quarter a year ago.

Provision for credit losses

The Company did not record a provision for credit losses in the fourth quarter of 2018 or 2017, based on a review of the appropriateness of the allowance for loan losses at December 31, 2018.  The following table summarizes the charge-offs and recoveries for the periods indicated:


Three months ended


Year ended December 31,


December 31, 2018


September 30, 2018


December 31, 2017


2018


2017


(In thousands) (Unaudited)

Charge-offs:










  Commercial loans

$                          -


$                        122


$                   1,503


$      629


$   3,313

  Real estate loans (1)

2,186


-


-


2,576


860

     Total charge-offs 

2,186


122


1,503


3,205


4,173

Recoveries:










  Commercial loans

625


187


2,001


1,875


3,402

  Construction loans

44


44


86


177


229

  Real estate loans(1)

451


2,949


1,160


4,765


7,355

     Total recoveries

1,120


3,180


3,247


6,817


10,986

Net (recoveries)/charge-offs

$                   1,066


$                    (3,058)


$                 (1,744)


$ (3,612)


$ (6,813)


(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 $10.4 million for the fourth quarter of 2018, an increase of $0.2 million, or 2.0%, compared to $10.2 million for the fourth quarter of 2017, primarily due to a $1.8 million increase in net unrealized gains from equity securities and offset by a $1.4 million decrease in net realized gains from securities.

Non-interest expense

Non-interest expense increased $7.1 million, or 10.7%, to $73.5 million in the fourth quarter of 2018 compared to $66.4 million in the same quarter a year ago.  The increase in non-interest expense in the fourth quarter of 2018 was primarily due to a $3.7 million increase in salaries and employee benefits expense, a $6.2 million increase in amortization expense of investments in low income housing and alternative energy partnerships offset by a $1.2 million decrease in provision for unfunded commitments, and a decrease of $1.9 million in FDIC and State assessments when compared to the same quarter a year ago.  Fourth quarter of 2018 non-interest expense included a $1.8 million impairment charge for investments in low income housing partnerships.  The efficiency ratio was 47.2% in the fourth quarter of 2018 compared to 46.3% for the same quarter a year ago.   

Income taxes

The effective tax rate for the fourth quarter of 2018 was 21.2% compared to 66.4% for the fourth quarter of 2017.  The effective tax rate includes the reduction of the corporate tax rate from the enactment of the Tax Cuts and Jobs Act, an alternative energy investment made in the second quarter and the impact of low-income housing tax credits.  Income tax expense for 2018 was reduced by $0.9 million in benefits from the distribution of restricted stock units and exercises of stock options.

BALANCE SHEET REVIEW

Gross loans, excluding loans held for sale, were $14.0 billion at December 31, 2018, an increase of $1.1 billion, or 8.5%, from $12.9 billion at December 31, 2017.  The increase was primarily due to increases of $631.8 million, or 20.6%, in residential mortgage loans, $280.7 million, or 11.4%, in commercial loans, and $241.5 million, or 3.7%, in commercial mortgage loans, which were partially offset by a decrease of $97.4 million, or 14.3%, in real estate construction loans.  The loan balances and composition at December 31, 2018, compared to September 30, 2018 and December 31, 2017, are presented below:


December 31, 2018


September 30, 2018


December 31, 2017


(In thousands) (Unaudited)

Commercial loans

$         2,741,965


$           2,674,089


$           2,461,266

Residential mortgage loans

3,693,853


3,569,111


3,062,050

Commercial mortgage loans

6,724,200


6,580,254


6,482,695

Equity lines

249,967


221,599


180,304

Real estate construction loans

581,454


597,018


678,805

Installment and other loans

4,349


5,575


5,170







Gross loans

$        13,995,788


$         13,647,646


$          12,870,290







Allowance for loan losses

(122,391)


(123,457)


(123,279)

Unamortized deferred loan fees

(1,565)


(2,086)


(3,245)







Total loans, net

$        13,871,832


$         13,522,103


$          12,743,766







Loans held for sale

$                        -


$                         -


$                   8,000

Total deposits were $13.7 billion at December 31, 2018, an increase of $1.0 billion, or 8.0%, from $12.7 billion at December 31, 2017.  The deposit balances and composition at December 31, 2018, compared to September 30, 2018 and December 31, 2017, are presented below:


December 31, 2018


September 30, 2018


December 31, 2017


(In thousands) (Unaudited)

Non-interest-bearing demand deposits

$             2,857,443


$              2,957,881


$             2,783,127

NOW deposits

1,365,763


1,409,463


1,410,519

Money market deposits

2,027,404


2,134,097


2,248,271

Savings deposits

738,656


747,814


857,199

Time deposits

6,713,074


6,331,823


5,390,777

Total deposits

$           13,702,340


$           13,581,078


$           12,689,893

ASSET QUALITY REVIEW

At December 31, 2018, total non-accrual loans were $41.8 million, a decrease of $0.6 million, or 1.4%, from $42.4 million at September 30, 2018, and a decrease of $7.0 million, or 14.3%, from $48.8 million at December 31, 2017.         

The allowance for loan losses was $122.4 million and the allowance for off-balance sheet unfunded credit commitments was $2.3 million at December 31, 2018, which represented the amount believed by management to be appropriate to absorb credit losses inherent in the loan portfolio, including unfunded credit commitments.  The $122.4 million allowance for loan losses at December 31, 2018, decreased $0.9 million, or 0.7%, from $123.3 million at December 31, 2017.  The allowance for loan losses represented 0.87% of period-end gross loans, excluding loans held for sale, and 268.5% of non-performing loans at December 31, 2018.  The comparable ratios were 0.96% of period-end gross loans, excluding loans held for sale, and 252.7% of non-performing loans at December 31, 2017.  The changes in non-performing assets and troubled debt restructurings at December 31, 2018, compared to December 31, 2017 and September 30, 2018, are shown below:

(Dollars in thousands) (Unaudited)

December 31, 2018


December 31, 2017


% Change


September 30, 2018


% Change

Non-performing assets










Accruing loans past due 90 days or more

$                      3,773


$                             -


100


$                        6,681


(44)

Non-accrual loans:










Construction loans

4,872


8,185


(40)


4,922


(1)

Commercial mortgage loans

10,611


19,820


(46)


13,172


(19)

Commercial loans

18,805


14,296


32


17,118


10

Residential mortgage loans

7,527


6,486


16


7,199


5

Total non-accrual loans:

$                    41,815


$                    48,787


(14)


$                     42,411


(1)

Total non-performing loans

45,588


48,787


(7)


49,092


(7)

Other real estate owned

12,674


9,442


34


8,741


45

Total non-performing assets

$                    58,262


$                    58,229


0


$                     57,833


1

Accruing  troubled  debt  restructurings (TDRs)

$                    65,071


$                    68,565


(5)


$                     74,598


(13)

Non-accrual loans held for sale

$                             -


$                      8,000


(100)


$                               -


-











Allowance for loan losses

$                  122,391


$                  123,279


(1)


$                   123,457


(1)











Total gross loans outstanding, at period-end (1)

$            13,995,788


$            12,870,290


9


$             13,647,646


3











Allowance for loan losses to non-performing loans, at period-end (2)

268.47%


252.69%




251.48%



Allowance for loan losses to gross loans, at period-end (1)

0.87%


0.96%




0.90%




(1) Excludes loans held for sale at period-end.

(2) Excludes non-accrual loans held for sale at period-end.

The ratio of non-performing assets, excluding non-accrual loans held for sale, to total assets was 0.3% at December 31, 2018, compared to 0.4% at December 31, 2017.  Total non-performing assets increased $33 thousand, or 0.1%, to $58.3 million at December 31, 2018, compared to $58.2 million at December 31, 2017, primarily due to an increase of $3.2 million, or 34.2%, in other real estate owned, and an increase of $3.8 million, or 100.0%, in accruing loans past due 90 days or more, offset by a decrease of $7.0 million, or 14.3%, in non-accrual loans. 

CAPITAL ADEQUACY REVIEW

At December 31, 2018, the Company's Tier 1 risk-based capital ratio of 12.44%, total risk-based capital ratio of 14.16%, and Tier 1 leverage capital ratio of 10.83%, 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, 2017, the Company's Tier 1 risk-based capital ratio was 12.19%, total risk-based capital ratio was 14.11%, and Tier 1 leverage capital ratio was 10.35%.

FULL YEAR REVIEW

Net income for the year ended December 31, 2018, was $272.2 million, an increase of $96.2 million, or 54.7%, compared to net income of $176.0 million for the year ended December 31, 2017, which included $22.3 million of additional tax expense related to the revaluation of the Company's deferred tax assets and a $2.6 million pretax write-down of low income housing tax credit investments as a result of the enactment of the Tax Cuts and Jobs Act.  Diluted earnings per share for the year ended December 31, 2018 was $3.34 compared to $2.17 per share for the year ended December 31, 2017.  The net interest margin for the year ended December 31, 2018, was 3.79% compared to 3.63% for the year ended December 31, 2017.

Return on average stockholders' equity was 13.19% and return on average assets was 1.70% for the year ended December 31, 2018, compared to a return on average stockholders' equity of 9.10% and a return on average assets of 1.19% for the year ended December 31, 2017.  The efficiency ratio for the year ended December 31, 2018, was 44.1% compared to 44.4% for the year ended December 31, 2017.   

CONFERENCE CALL

Cathay General Bancorp will host a conference call this afternoon to discuss its fourth quarter and year end 2018 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 1-855-761-3186 and enter Conference ID 2655929. 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 40 branches in California, 11 branches in New York State, four in Washington, three in Illinois, Chicago area, two in Texas, one in Maryland, one in Massachusetts, one in Nevada, one in 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 U.S. and international business and economic conditions; 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; environmental liabilities; our ability to compete with larger competitors; our ability to retain key personnel; successful management of reputational risk; natural disasters 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; our ability to consummate and realize the anticipated benefits of our acquisitions; the risk that integration of business operations following any acquisitions, will be materially delayed or will be more costly or difficult than expected; 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, 2017 (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

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)




Three months ended


Year ended December 31,

(Dollars in thousands, except per share data)


December 31, 2018


September 30, 2018


December 31, 2017


2018


2017












FINANCIAL PERFORMANCE











Net interest income before provision for credit losses    

$                  145,441


$                   145,084


$                  133,298


$565,899


$495,709

Reversal for credit losses


-


(1,500)


-


(4,500)


(2,500)

Net interest income after reversal for credit losses


145,441


146,584


133,298


570,399


498,209

Non-interest income


10,436


7,835


10,215


31,348


36,297

Non-interest expense


73,513


65,964


66,407


263,536


236,199

Income before income tax expense


82,364


88,455


77,106


338,211


298,307

Income tax expense


17,424


18,698


51,166


66,034


122,265

Net income


$                    64,940


$                     69,757


$                    25,940


$272,177


176,042












Net income per common share











Basic


$                         0.80


$                          0.86


$                         0.32


$       3.35


$      2.19

Diluted


$                         0.80


$                          0.85


$                         0.32


$       3.34


$      2.17












 Cash dividends paid per common share  


$                         0.31


$                          0.24


$                         0.24


$       1.03


$      0.87























SELECTED RATIOS











Return on average assets


1.57%


1.72%


0.66%


1.70%


1.19%

Return on average total stockholders' equity


12.13%


13.19%


5.18%


13.19%


9.10%

Efficiency ratio


47.16%


43.14%


46.27%


44.13%


44.40%

Dividend payout ratio


38.42%


28.00%


74.78%


30.66%


39.70%























YIELD ANALYSIS (Fully taxable equivalent)











Total interest-earning assets


4.76%


4.67%


4.27%


4.61%


4.22%

Total interest-bearing liabilities


1.36%


1.15%


0.84%


1.12%


0.81%

Net interest spread


3.40%


3.52%


3.43%


3.49%


3.41%

Net interest margin


3.77%


3.83%


3.65%


3.79%


3.63%













































CAPITAL RATIOS


December 31, 2018


September 30, 2018


December 31, 2017





Tier 1 risk-based capital ratio


12.44%


12.81%


12.19%





Total risk-based capital ratio


14.16%


14.60%


14.11%





Tier 1 leverage capital ratio


10.83%


11.03%


10.35%







.









 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(In thousands, except share and per share data)


December 31, 2018


September 30, 2018


December 31, 2017








Assets







Cash and due from banks


$                    225,333


$                    204,178


$                    247,056

Short-term investments and interest bearing deposits


374,957


377,839


292,745

Cash and cash equivalents


600,290


582,017


539,801

Securities available-for-sale (amortized cost of $1,267,731 at December 31, 2018, $1,320,843 at September 30, 2018 and $1,336,345 at December 31, 2017)


1,242,509


1,283,060


1,333,626

Loans held for sale


-


-


8,000

Loans


13,995,788


13,647,646


12,870,290

Less:  Allowance for loan losses


(122,391)


(123,457)


(123,279)

Unamortized deferred loan fees, net


(1,565)


(2,086)


(3,245)

Loans, net


13,871,832


13,522,103


12,743,766

Equity securities


25,098


23,522


-

Federal Home Loan Bank stock


17,250


17,250


23,085

Other real estate owned, net


12,674


8,741


9,442

Affordable housing investments and alternative energy partnerships, net


284,614


295,857


272,871

Premises and equipment, net


103,189


102,565


103,064

Customers' liability on acceptances


22,709


10,454


13,482

Accrued interest receivable


51,650


50,291


45,307

Goodwill


372,189


372,189


372,189

Other intangible assets, net


7,194


7,391


8,062

Other assets


174,562


186,282


167,491








Total assets


$               16,785,760


$               16,461,722


$               15,640,186








Liabilities and Stockholders' Equity







Deposits







Non-interest-bearing demand deposits


$                 2,857,443


$                 2,957,881


$                 2,783,127

Interest-bearing deposits:







NOW deposits


1,365,763


1,409,463


1,410,519

Money market deposits


2,027,404


2,134,097


2,248,271

Savings deposits


738,656


747,814


857,199

Time deposits 


6,713,074


6,331,823


5,390,777

Total deposits


13,702,340


13,581,078


12,689,893








Securities sold under agreements to repurchase


-


-


100,000

Advances from the Federal Home Loan Bank


530,000


315,000


430,000

Other borrowings for affordable housing investments


17,298


17,332


17,481

Long-term debt


189,448


194,136


194,136

Deferred payments from acquisition


18,458


18,253


35,404

Acceptances outstanding


22,709


10,454


13,482

Other liabilities


183,349


208,694


186,486

Total liabilities


14,663,602


14,344,947


13,666,882

Stockholders' equity


2,122,158


2,116,775


1,973,304

Total liabilities and equity


$               16,785,760


$               16,461,722


$               15,640,186








Book value per common share


$                         26.36


$                         25.93


$                         24.26

Number of common shares outstanding


80,501,948


81,396,047


80,893,379

 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



Three months ended


Year ended December 31,


December 31, 2018

September 30, 2018

December 31, 2017


2018

2017


(In thousands, except share and per share data)

INTEREST AND  DIVIDEND INCOME







Loan receivable, including loan fees

$                   174,352

$                     168,179

$                   148,162


$    652,480

$    549,291

Investment securities

7,391

7,546

5,965


28,603

20,531

Federal Home Loan Bank stock

584

303

481


1,663

1,798

Federal funds sold and securities purchased under agreements to resell

-

-

2


-

110

Deposits with banks

1,542

838

1,281


5,209

4,421








Total interest and dividend income

183,869

176,866

155,891


687,955

576,151








INTEREST EXPENSE







Time deposits 

29,774

22,135

13,339


86,368

46,768

Other deposits

5,610

5,474

4,831


20,503

19,076

Securities sold under agreements to repurchase

-

124

761


1,446

4,250

Advances from Federal Home Loan Bank

620

1,430

1,246


3,739

2,711

Long-term debt

1,456

2,220

1,455


5,776

5,775

Deferred payments from acquisition

947

399

960


4,037

1,861

Short-term borrowings

21


1


187

1








Total interest expense

38,428

31,782

22,593


122,056

80,442








Net interest income before reversal for credit losses

145,441

145,084

133,298


565,899

495,709

Reversal for credit losses

-

(1,500)

-


(4,500)

(2,500)








Net interest income after reversal for credit losses

145,441

146,584

133,298


570,399

498,209








NON-INTEREST INCOME







Net gains/(losses) from equity securities

1,793

391



(2,787)

-

Securities gains/(losses), net

36

(14)

1,445


22

1,006

Letters of credit commissions

1,505

1,459

1,242


5,614

4,860

Depository service fees

1,179

1,219

1,405


5,084

5,624

Gains from acquisition

-

-

188


340

5,628

Other operating income

5,923

4,780

5,935


23,075

19,179








Total non-interest income

10,436

7,835

10,215


31,348

36,297








NON-INTEREST EXPENSE







Salaries and employee benefits

33,252

30,514

29,529


124,743

109,458

Occupancy expense

4,883

5,186

5,696


20,691

20,429

Computer and equipment expense

2,922

2,772

2,951


11,400

10,846

Professional services expense

6,030

5,286

5,898


23,085

20,439

Data processing service expense

2,988

3,080

3,344


12,438

11,190

FDIC and State assessments

1,468

2,555

3,372


8,200

10,633

Marketing expense

2,316

1,263

1,367


7,837

6,200

Other real estate owned expense

(483)

(21)

(2,396)


(719)

(1,649)

Amortization of investments in low income housing and alternative energy partnerships

16,646

11,115

10,415


38,635

27,212

Amortization of core deposit intangibles

172

190

304


876

930

Acquisition and integration costs

23

179

844


2,106

4,121

Other operating expense

3,296

3,845

5,083


14,244

16,390








Total non-interest expense

73,513

65,964

66,407


263,536

236,199








Income before income tax expense

82,364

88,455

77,106


338,211

298,307

Income tax expense

17,424

18,698

51,166


66,034

122,265

Net income

$                      64,940

$                       69,757

$                      25,940


272,177

176,042








Net income per common share:







Basic

$                          0.80

$                            0.86

$                          0.32


$           3.35

$           2.19

Diluted

$                          0.80

$                            0.85

$                          0.32


$           3.34

$           2.17








Cash dividends paid per common share

$                          0.31

$                            0.24

$                          0.24


$           1.03

$           0.87

Basic average common shares outstanding

80,854,451

81,311,899

80,825,201


81,131,269

80,262,782

Diluted average common shares outstanding

81,122,093

81,855,271

81,619,905


81,607,346

81,004,550

 

CATHAY GENERAL BANCORP

AVERAGE BALANCES – SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited) 



Three months ended

(In thousands)

December 31, 2018


September 30, 2018


December 31, 2017










Interest-earning assets

Average
Balance

Average
Yield/Rate
(1)


Average
Balance

Average
Yield/Rate
(1)


Average
Balance

Average
Yield/Rate
(1)

Loans (1)

$13,737,560

5.04%


$13,434,018

4.97%


$12,735,456

4.62%

Taxable investment securities 

1,306,821

2.24%


1,399,031

2.14%


1,338,653

1.77%

FHLB stock

17,250

13.44%


17,250

6.95%


25,770

7.40%

Federal funds sold and securities purchased under agreements to resell

-

-


-

-


1,978

0.54%

Deposits with banks

262,525

2.33%


178,434

1.86%


387,725

1.31%










Total interest-earning assets

$15,324,156

4.76%


$15,028,733

4.67%


$14,489,582

4.27%










Interest-bearing liabilities









Interest-bearing demand deposits

$   1,373,250

0.21%


$   1,396,436

0.20%


$   1,366,808

0.18%

Money market deposits

2,113,257

0.85%


2,234,139

0.79%


2,361,128

0.62%

Savings deposits

746,224

0.20%


780,412

0.18%


886,706

0.24%

Time deposits

6,616,390

1.79%


5,997,268

1.46%


5,263,846

1.01%

Total interest-bearing deposits

$10,849,121

1.29%


$10,408,255

1.05%


$   9,878,488

0.73%

Securities sold under agreements to repurchase

-

0.00%


16,304

3.02%


100,000

3.02%

Other borrowed funds

152,654

1.99%


307,298

2.36%


491,000

1.52%

Long-term debt

194,085

4.62%


194,136

4.54%


158,266

4.45%

Total interest-bearing liabilities

11,195,860

1.36%


10,925,993

1.15%


10,627,754

0.84%










Non-interest-bearing demand deposits

2,887,607



2,877,646



2,766,338











Total deposits and other borrowed funds

$14,083,467



$13,803,639



$13,394,092



0








Total average assets

$16,418,979



$16,134,349



$15,591,373


Total average equity

$   2,124,418



$   2,097,786



$   1,984,890












Year ended,




(In thousands)

December 31, 2018


December 31, 2017












Interest-earning assets

Average
Balance

Average
Yield/Rate
(1)


Average
Balance

Average
Yield/Rate
(1)




Loans (1)

$13,280,665

4.91%


$11,937,666

4.60%




Taxable investment securities 

1,344,964

2.13%


1,308,089

1.57%




FHLB stock

18,540

8.97%


23,208

7.75%




Federal funds sold and securities purchased under agreements to resell

-

-


9,499

1.16%




Deposits with banks

277,005

1.88%


366,674

1.21%













Total interest-earning assets

$14,921,174

4.61%


$13,645,136

4.22%













Interest-bearing liabilities









Interest-bearing demand deposits

$   1,389,326

0.20%


$   1,304,053

0.17%




Money market deposits

2,200,847

0.74%


2,360,188

0.64%




Savings deposits

791,982

0.20%


834,973

0.21%




Time deposits

6,031,061

1.43%


4,947,051

0.95%




Total interest-bearing deposits

$10,413,216

1.03%


$   9,446,265

0.70%




Securities sold under agreements to repurchase

49,589

2.92%


136,849

3.11%




Other borrowed funds

253,714

1.90%


256,423

1.66%




Long-term debt

194,123

4.49%


128,999

4.73%




Total interest-bearing liabilities

10,910,642

1.12%


9,968,536

0.81%













Non-interest-bearing demand deposits

2,819,712



2,599,109














Total deposits and other borrowed funds

$13,730,354



$12,567,645














Total average assets

$16,004,322



$14,733,002





Total average equity

$   2,063,400



$   1,935,059






(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

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