2014

Cathay General Bancorp Announces Net Income of $28.8 Million, or $0.30 Per Share, For the First Quarter 2013

LOS ANGELES, April 16, 2013 /PRNewswire/ -- Cathay General Bancorp (the "Company") (NASDAQ: CATY), the holding company for Cathay Bank (the "Bank"), today announced results for the first quarter of 2013.

FINANCIAL PERFORMANCE


Three months ended March 31,


2013


2012

Net income

$28.8 million


$28.9 million

Net income available to common stockholders

$23.7 million


$24.8 million

Basic earnings per common share

$0.30


$0.32

Diluted earnings per common share

$0.30


$0.32

Return on average assets

1.12%


1.10%

Return on average total stockholders' equity

7.20%


7.62%

Efficiency ratio

51.71%


53.50%

FIRST QUARTER HIGHLIGHTS

  • Redemption on March 20, 2013, of $129 million, or 50%, of the Bancorp's preferred stock issued under the U.S. Treasury's TARP Capital Purchase Program.
  • Memorandum of Understanding of Cathay General Bancorp lifted by the Federal Reserve Bank of San Francisco effective April 5, 2013.
  • Increase in the net interest margin to 3.35% for the first quarter of 2013 compared to 3.28% for the fourth quarter of 2012.

"We are pleased to have redeemed half of our preferred stock issued under the TARP Capital Purchase Program and intend to continue working towards redeeming the remaining preferred stock as soon as possible.  We are also pleased that the Federal Reserve Bank has terminated our MOU," commented Dunson Cheng, Chairman of the Board, Chief Executive Officer, and President of the Company.

"During the first quarter, we contracted to open two new branches and expect to enter into a lease for a third branch in the second quarter.  We continue to look for sites for new branches in our footprint to better serve our customers," said Peter Wu, Executive Vice Chairman and Chief Operating Officer.

"We are happy to see continuing improvement in profitability in the first quarter without any contribution from a negative loan loss provision.  We expect to achieve steady loan growth in the remaining three quarters of 2013," concluded Dunson Cheng.

INCOME STATEMENT REVIEW

Net income available to common stockholders for the quarter ended March 31, 2013, was $23.7 million, a decrease of $1.1 million, or 4.6%, compared to a net income available to common stockholders of $24.8 million for the same quarter a year ago.  Diluted earnings per share available to common stockholders for the quarter ended March 31, 2013, was $0.30 compared to $0.32 for the same quarter a year ago due primarily to the reversal for credit losses in 2012, increases in salaries and employee benefits, increases in costs associated with debt redemption, and the $1.3 million noncash charge associated with the redemption of preferred shares issued to the U.S. Treasury offset by increases in gains on sale of securities and in commissions from wealth management.

Return on average stockholders' equity was 7.20% and return on average assets was 1.12% for the quarter ended March 31, 2013, compared to a return on average stockholders' equity of 7.62% and a return on average assets of 1.10% for the same quarter a year ago.

Net interest income before provision for credit losses

Net interest income before provision for credit losses decreased $519,000, or 0.6%, to $80.1 million during the first quarter of 2013 compared to $80.7 million during the same quarter a year ago.  The decrease was due primarily to the decrease in interest income from investment securities and loans offset by the decrease in interest expense from time deposits and securities sold under agreements to repurchase.

The net interest margin, on a fully taxable-equivalent basis, was 3.35% for the first quarter of 2013, compared to 3.28% for the fourth quarter of 2012, and 3.33% for the first quarter of 2012.  The decrease in the interest expense on time deposits and securities sold under agreements to repurchase offset by decrease in earnings on investment securities and loans contributed to the increase in the net interest margin. 

For the first quarter of 2013, the yield on average interest-earning assets was 4.26%, on a fully taxable-equivalent basis, the cost of funds on average interest-bearing liabilities was 1.18%, and the cost of interest bearing deposits was 0.63%.  In comparison, for the first quarter of 2012, the yield on average interest-earning assets was 4.54%, on a fully taxable-equivalent basis, the cost of funds on average interest-bearing liabilities was 1.51%, and the cost of interest bearing deposits was 0.86%. The interest spread, defined as the difference between the yield on average interest-earning assets and the cost of funds on average interest-bearing liabilities, increased 5 basis points to 3.08% for the quarter ended March 31, 2013, from 3.03% for the same quarter a year ago, primarily for the reasons discussed above.

Provision for credit losses

There was no provision for credit losses for the first quarter of 2013 compared to a credit of $4.0 million in the first quarter of 2012.  The provision for credit losses was based on the review of the adequacy of the allowance for loan losses at March 31, 2013. The provision or reversal for credit losses represents the charge against or benefit toward current earnings that is determined by management, through a credit review process, as the amount needed to establish an allowance that management believes to be sufficient to absorb credit losses inherent in the Company's loan portfolio, including unfunded commitments.  The following table summarizes the charge-offs and recoveries for the periods indicated:


Three months ended



March 31, 2013


December 31, 2012


March 31, 2012



(In thousands)


Charge-offs:







  Commercial loans

$              2,690


$                    3,228


$              4,959


  Construction loans- residential

-


-


140


  Construction loans- other

-


-


735


  Real estate loans (1)

1,130


1,265


8,927


  Real estate- land loans

270


177


74


  Installment and other loans

-


-


25


     Total charge-offs 

4,090


4,670


14,860


Recoveries:







  Commercial loans

955


719


746


  Construction loans- residential

46


76


1,899


  Construction loans- other

33


452


1,658


  Real estate loans (1)

359


2,036


1,631


  Real estate- land loans

9


24


793


  Installment and other loans

-


-


3


     Total recoveries

1,402


3,307


6,730


Net charge-offs

$              2,688


$                    1,363


$              8,130









(1) Real estate loans include commercial mortgage loans, residential mortgage loans and equity lines.

Non-interest income

Non-interest income, which includes revenues from depository service fees, letters of credit commissions, securities gains (losses), gains (losses) on loan sales, wire transfer fees, and other sources of fee income, was $14.9 million for the first quarter of 2013, an increase of $6.1 million, or 68.5%, compared to $8.8 million for the first quarter of 2012. The increase in non-interest income in the first quarter of 2013 was primarily due to an increase of $4.1 million from gains on sale of securities, an increase of $831,000 in commissions from wealth management, and a decrease of $755,000 from trading security losses.

Non-interest expense

Non-interest expense increased $1.2 million, or 2.6%, to $49.1 million in the first quarter of 2013 compared to $47.9 million in the same quarter a year ago.  The efficiency ratio was 51.71% in the first quarter of 2013 compared to 53.50% for the same quarter a year ago.

Prepayment penalties increased $2.8 million to $5.6 million in the first quarter of 2013 compared to $2.8 million in the same quarter a year ago.  The Company prepaid securities sold under agreements to repurchase of $100.0 million in the first quarter of 2013 and prepaid $100.0 million of FHLB advances in the first quarter of 2012.  Salaries and employee benefits increased $3.0 million, or 15.0%, in the first quarter of 2013 compared to the same quarter a year ago primarily due the hiring of new employees as well as the addition of temporary employees related to the upcoming core system conversion.  Professional expense increased $1.1 million to $5.8 million in the first quarter of 2013 compared to $4.7 million in the same quarter a year ago primarily due to higher legal collection expenses.  Offsetting the above increases were a $4.1 million decrease in other real estate owned ("OREO") expenses, a $969,000 decrease in marketing expenses, and a $751,000 decrease in FDIC and State assessments.  Decreases in the OREO provision and OREO operating expenses contributed primarily to the decrease in OREO expenses.

Income taxes

The effective tax rate for the first quarter of 2013 was 36.9% compared to 36.4% in the first quarter of 2012.  The effective tax rate includes the impact of the utilization of low income housing tax credits and the recognition of other tax credits.

BALANCE SHEET REVIEW

Gross loans were $7.36 billion at March 31, 2013, a decrease of $64.8 million, or 0.9%, from $7.43 billion at December 31, 2012, primarily due to a decrease of $95.3 million, or 4.5%, in commercial loans and a decrease of $8.9 million, or 0.2%, in commercial mortgage loans offset by an increase of $37.2 million, or 3.2%, in residential mortgage loans.  The changes in loan composition from December 31, 2012, are presented below:

Type of Loans

March 31, 2013


December 31, 2012


 % Change 


(Dollars in thousands)



Commercial loans

$      2,031,789


$            2,127,107


(4)

Residential mortgage loans

1,183,460


1,146,230


3

Commercial mortgage loans

3,759,580


3,768,452


(0)

Equity lines

191,462


193,852


(1)

Real estate construction loans

184,067


180,950


2

Installment & other loans

13,982


12,556


11







Gross loans

$      7,364,340


$            7,429,147


(1)







Allowance for loan losses

(178,692)


(183,322)


(3)

Unamortized deferred loan fees

(10,186)


(10,238)


(1)







Total loans, net

$      7,175,462


$            7,235,587


(1)

During the first quarter of 2013, investment securities that were held to maturity totaling $722.5 million were reclassified to securities deemed available for sale.  Upon reclassification, a net unrealized gain was recorded for these securities totaling $40.5 million.

Total deposits were $7.43 billion at March 31, 2013, an increase of $42.4 million, or 0.6%, from $7.38 billion at December 31, 2012, primarily due to a $41.6 million, or 6.5%, increase in time deposits under $100,000 and a $25.2 million, or 0.8%, increase in time deposits of $100,000 or more, a $29.3 million, or 4.9%, increase in NOW deposits, and a $10.5 million, or 0.8%, increase in non-interest bearing demand deposits, offset by a $62.5 million, or 5.3%, decrease in money market deposits.  The changes in deposit composition from December 31, 2012, are presented below:

Deposits 

March 31, 2013


December 31, 2012


 % Change 


(Dollars in thousands)



Non-interest-bearing demand deposits

$      1,279,986


$            1,269,455


1

NOW deposits

622,454


593,133


5

Money market deposits

1,124,240


1,186,771


(5)

Savings deposits

472,122


473,805


(0)

Time deposits under $100,000

685,758


644,191


6

Time deposits of $100,000 or more

3,241,114


3,215,870


1

Total deposits

$      7,425,674


$            7,383,225


1

ASSET QUALITY REVIEW

At March 31, 2013, total non-accrual loans, excluding loans held for sale, were $100.3 million, a decrease of $31.2 million, or 23.7%, from $131.5 million at March 31, 2012, and a decrease of $3.6 million, or 3.4%, from $103.9 million at December 31, 2012.       

The allowance for loan losses was $178.7 million and the allowance for off-balance sheet unfunded credit commitments was $3.3 million at March 31, 2013, which represented the amount believed by management to be sufficient to absorb credit losses inherent in the loan portfolio, including unfunded commitments.  The allowance for credit losses, which is the sum of the allowances for loan losses and for off-balance sheet unfunded credit commitments, was $182.0 million at March 31, 2013, compared to $184.7 million at December 31, 2012, a decrease of $2.7 million, or 1.5%.  The allowance for credit losses represented 2.47% of period-end gross loans and 180.0% of non-performing loans at March 31, 2013.  The comparable ratios were 2.49% of period-end gross loans and 176.7% of non-performing loans at December 31, 2012.  The changes in the Company's non-performing assets and troubled debt restructurings at March 31, 2013, compared to December 31, 2012, and to March 31, 2012, are highlighted below:

(Dollars in thousands)

March 31, 2013


December 31, 2012


% Change


March 31, 2012


% Change

Non-performing assets










Accruing loans past due 90 days or more

$                 800


$                        630


27


$                      1,389


(42)

Non-accrual loans:










  Construction- residential loans

3,271


2,984


10


3,593


(9)

  Construction- non-residential loans

32,966


33,315


(1)


7,118


363

  Land loans

8,325


6,053


38


9,688


(14)

  Commercial real estate loans, excluding land loans

30,896


29,651


4


66,931


(54)

  Commercial loans

13,192


19,958


(34)


30,329


(57)

  Residential mortgage loans

11,679


11,941


(2)


13,838


(16)

Total non-accrual loans:

$          100,329


$                 103,902


(3)


$                  131,497


(24)

Total non-performing loans

101,129


104,532


(3)


132,886


(24)

 Other real estate owned

45,316


46,384


(2)


87,806


(48)

Total non-performing assets

$          146,445


$                 150,916


(3)


$                  220,692


(34)

Accruing  troubled  debt  restructurings (TDRs)

$          130,215


$                 144,695


(10)


$                  143,233


(9)

Non-accrual loans held for sale

$                    -


$                           -


-


$                         500


(100)











Allowance for loan losses

$          178,692


$                 183,322


(3)


$                  194,743


(8)

Allowance for off-balance sheet credit commitments

3,304


1,362


143


1,475


124

Allowance for credit losses

$          181,996


$                 184,684


(1)


$                  196,218


(7)











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

$       7,364,340


$              7,429,147


(1)


$               6,908,544


7











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

176.70%


175.37%




146.55%



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

2.43%


2.47%




2.82%



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

2.47%


2.49%




2.84%



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

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

Troubled debt restructurings on accrual status totaled $130.2 million at March 31, 2013, compared to $144.7 million at December 31, 2012.  These loans are classified as troubled debt restructurings as a result of granting a concession to borrowers.  Although these loan modifications are considered troubled debt restructurings under Accounting Standard Codification 310-40 and Accounting Standard Update 2011-02, these loans have been performing under the restructured terms and have demonstrated sustained performance under the modified terms.  The sustained performance considered by management includes the periods prior to the modification if the prior performance met or exceeded the modified terms as well as cash paid to set up interest reserves.  

The ratio of non-performing assets to total assets was 1.4% at March 31, 2013, compared to 1.4% at December 31, 2012.  Total non-performing assets decreased $4.5 million, or 3.0%, to $146.4 million at March 31, 2013, compared to $150.9 million at December 31, 2012, primarily due to a $3.6 million, or 3.4%, decrease in non-accrual loans and a $1.1 million, or 2.3%, decrease in other real estate owned. 

CAPITAL ADEQUACY REVIEW

At March 31, 2013, the Company's Tier 1 risk-based capital ratio of 16.38%, total risk-based capital ratio of 18.16%, and Tier 1 leverage capital ratio of 13.06%, continue to place the Company in the "well capitalized" category for regulatory purposes, which is defined as institutions with a Tier 1 risk-based capital ratio equal to or greater than 6%, a total risk-based capital ratio equal to or greater than 10%, and a Tier 1 leverage capital ratio equal to or greater than 5%. At December 31, 2012, the Company's Tier 1 risk-based capital ratio was 17.36%, total risk-based capital ratio was 19.12%, and Tier 1 leverage capital ratio was 13.82%.

CONFERENCE CALL

Cathay General Bancorp will host a conference call this afternoon to discuss its first quarter of 2013 financial results. The call will begin at 3:00 p.m. Pacific Time. Analysts and investors may dial in and participate in the question-and-answer session. To access the call, please dial 1-866-271-5140 and enter Participant Passcode 63087242. 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 31 branches in California, eight branches in New York State, one in Massachusetts, two in Texas, three in Washington State, three in the Chicago, Illinois area, one in New Jersey, one in Hong Kong, and a representative office in Shanghai and in Taipei. Cathay Bank's website is found at http://www.cathaybank.com. Cathay General Bancorp's website is found at http://www.cathaygeneralbancorp.com.  Information set forth on such websites is not incorporated into this press release.

FORWARD-LOOKING STATEMENTS AND OTHER NOTICES

Statements made in this press release, other than statements of historical fact, are forward-looking statements within the meaning of the applicable provisions of the Private Securities Litigation Reform Act of 1995 regarding management's beliefs, projections, and assumptions concerning future results and events. These forward-looking statements may include, but are not limited to, such words as "aims," "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "hopes," "intends," "may," "plans," "projects," "predicts," "potential," "possible," "optimistic," "seeks," "shall," "should," "will," and variations of these words and similar expressions. Forward-looking statements are based on estimates, beliefs, projections, and assumptions of management and are not guarantees of future performance. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or projections. Such risks and uncertainties and other factors include, but are not limited to, adverse developments or conditions related to or arising from U.S. and international business and economic conditions; credit risks of lending activities and deterioration in asset or credit quality; current and potential future supervisory action by federal supervisory authorities; increased costs of compliance and other risks associated with changes in regulation and the current regulatory environment, including the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), and the potential for substantial changes in the legal, regulatory, and enforcement framework and oversight applicable to financial institutions in reaction to recent adverse financial market events, including changes pursuant to the Dodd-Frank Act; potential goodwill impairment; liquidity risk; fluctuations in interest rates; inflation and deflation; risks associated with acquisitions and the expansion of our business into new markets; real estate market conditions and the value of real estate collateral; environmental liabilities; our ability to compete with larger competitors; the possibility of higher capital requirements, including implementation of the Basel III capital standards of the Basel Committee; our ability to retain key personnel; successful management of reputational risk; natural disasters and geopolitical events; general economic or business conditions in California, Asia, and other regions where Cathay Bank has operations; restrictions on compensation paid to our executives as a result of our participation in the TARP Capital Purchase Program; failures, interruptions, or security breaches of our information systems; our ability to adapt our systems to technological changes, including successfully implementing our core system conversion; adverse results in legal proceedings; changes in accounting standards or tax laws and regulations; market disruption and volatility; restrictions on dividends and other distributions by laws and regulations and by our regulators and our capital structure; successfully raising additional capital, if needed, and the resulting dilution of interests of holders of our common stock; and the soundness of other financial institutions.

These and other factors are further described in Cathay General Bancorp's Annual Report on Form 10-K for the year ended December 31, 2012 (Item 1A in particular), other reports filed with the Securities and Exchange Commission ("SEC"), and other filings Cathay General Bancorp makes with the SEC from time to time. Actual results in any future period may also vary from the past results discussed in this press release. Given these risks and uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements, which speak to the date of this press release. Cathay General Bancorp has no intention and undertakes no obligation to update any forward-looking statement or to publicly announce any revision of any forward-looking statement to reflect future developments or events, except as required by law.

Cathay General Bancorp's filings with the SEC are available at the website maintained by the SEC at http://www.sec.gov, or by request directed to Cathay General Bancorp, 9650 Flair Drive, El Monte, California 91731, Attention: Investor Relations (626) 279-3286.

 

CATHAY GENERAL BANCORP

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)






Three months ended March 31,



(Dollars in thousands, except per share data)

2013


2012


% Change







FINANCIAL PERFORMANCE






Net interest income before provision for credit losses    

$  80,132


$  80,651


(1)

Provision/(reversal) for credit losses

-


(4,000)


(100)

Net interest income after provision for credit losses

80,132


84,651


(5)

Non-interest income

14,881


8,831


69

Non-interest expense

49,128


47,871


3

Income before income tax expense

45,885


45,611


1

Income tax expense

16,887


16,547


2

Net income

28,998


29,064


(0)

  Net income attributable to noncontrolling interest

151


151


-

Net income attributable to Cathay General Bancorp

$  28,847


$  28,913


(0)

Dividends on preferred stock and noncash charge from repayment

(5,184)


(4,117)


26

Net income attributable to common stockholders

$  23,663


$  24,796


(5)







Net income attributable to common stockholders per common share:






Basic

$      0.30


$      0.32


(6)

Diluted

$      0.30


$      0.32


(6)







 Cash dividends paid per common share  

$      0.01


$      0.01


-













SELECTED RATIOS






Return on average assets

1.12%


1.10%


2

Return on average total stockholders' equity

7.20%


7.62%


(6)

Efficiency ratio

51.71%


53.50%


(3)

Dividend payout ratio

2.73%


2.72%


0













YIELD ANALYSIS (Fully taxable equivalent)






Total interest-earning assets

4.26%


4.54%


(6)

Total interest-bearing liabilities

1.18%


1.51%


(22)

Net interest spread

3.08%


3.03%


2

Net interest margin

3.35%


3.33%


1































CAPITAL RATIOS

March 31, 2013


March 31, 2012


December 31, 2012

Tier 1 risk-based capital ratio

16.38%


16.71%


17.36%

Total risk-based capital ratio

18.16%


18.62%


19.12%

Tier 1 leverage capital ratio

13.06%


13.14%


13.82%







 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited) 







(In thousands, except share and per share data)

March 31, 2013


December 31, 2012


% change







Assets






Cash and due from banks

$                   155,525


$                    144,909


7

Short-term investments and interest bearing deposits

215,794


411,983


(48)

Securities held-to-maturity (market value of $823,906 in 2012)

-


773,768


(100)

Securities available-for-sale (amortized cost of $2,149,786 in 2013 and $1,290,676 in 2012)

 

2,190,296


 

1,291,480


 

70

Trading securities

4,758


4,703


1

Loans

7,364,340


7,429,147


(1)

Less:  Allowance for loan losses

(178,692)


(183,322)


(3)

 Unamortized deferred loan fees, net

(10,186)


(10,238)


(1)

 Loans, net

7,175,462


7,235,587


(1)

Federal Home Loan Bank stock

37,130


41,272


(10)

Other real estate owned, net

45,316


46,384


(2)

Affordable housing investments, net

83,868


85,037


(1)

Premises and equipment, net

102,067


102,613


(1)

Customers' liability on acceptances

22,334


41,271


(46)

Accrued interest receivable

26,992


26,015


4

Goodwill

316,340


316,340


-

Other intangible assets, net

4,883


6,132


(20)

Other assets

139,950


166,595


(16)







Total assets

$              10,520,715


$               10,694,089


(2)







Liabilities and Stockholders' Equity






Deposits






Non-interest-bearing demand deposits

$                1,279,986


$                 1,269,455


1

Interest-bearing deposits:






NOW deposits

622,454


593,133


5

Money market deposits

1,124,240


1,186,771


(5)

Savings deposits

472,122


473,805


(0)

Time deposits under $100,000

685,758


644,191


6

Time deposits of $100,000 or more

3,241,114


3,215,870


1

Total deposits

7,425,674


7,383,225


1







Securities sold under agreements to repurchase

1,150,000


1,250,000


(8)

Advances from the Federal Home Loan Bank

126,200


146,200


(14)

Other borrowings for affordable housing investments

19,232


18,713


3

Long-term debt

171,136


171,136


-

Acceptances outstanding

22,334


41,271


(46)

Other liabilities

56,574


54,040


5

Total liabilities

8,971,150


9,064,585


(1)

     Commitments and contingencies

-


-


-

Stockholders' Equity






Preferred stock, 10,000,000 shares authorized, 129,000 issued and outstanding at March 31, 2013, and 258,000 issued and outstanding at December 31, 2012

 

127,724


 

254,580


 

(50)

Common stock, $0.01 par value, 100,000,000 shares authorized, 83,066,773 issued and 78,859,208 outstanding at March 31, 2013, and 82,985,853 issued and 78,778,288 outstanding at December 31, 2012

 

831


 

830


 

0

Additional paid-in-capital

769,955


768,925


0

Accumulated other comprehensive income/(loss), net

23,477


465


4,949

Retained earnings

744,867


721,993


3

Treasury stock, at cost (4,207,565 shares at March 31, 2013, and at December 31, 2012)

 

(125,736)


 

(125,736)


 

-







Total Cathay General Bancorp stockholders' equity

1,541,118


1,621,057


(5)

Noncontrolling interest

8,447


8,447


-

Total equity

1,549,565


1,629,504


(5)

Total liabilities and equity

$              10,520,715


$               10,694,089


(2)







Book value per common share

$17.70


$17.12


3

Number of common shares outstanding

78,859,208


78,778,288


0

 

CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)




Three months ended March 31,


2013

2012


(In thousands, except share and per share data)

INTEREST AND  DIVIDEND INCOME



Loan receivable, including loan fees

$      88,840

$      90,701

Investment securities- taxable

11,786

17,723

Investment securities- nontaxable

967

1,052

Federal Home Loan Bank stock

250

66

Federal funds sold and securities purchased under agreements to resell

 

-

 

5

Deposits with banks

208

588




Total interest and dividend income

102,051

110,135




INTEREST EXPENSE



Time deposits of $100,000 or more

6,757

9,540

Other deposits

2,766

3,916

Securities sold under agreements to repurchase

11,392

14,655

Advances from Federal Home Loan Bank

80

53

Long-term debt

924

1,320




Total interest expense

21,919

29,484




Net interest income before provision for credit losses

80,132

80,651

Provision/(reversal) for credit losses

-

(4,000)




Net interest income after provision for credit losses

80,132

84,651




NON-INTEREST INCOME



Securities gains, net

6,292

2,215

Letters of credit commissions

1,461

1,526

Depository service fees

1,474

1,389

Other operating income

5,654

3,701




Total non-interest income

14,881

8,831




NON-INTEREST EXPENSE



Salaries and employee benefits

22,853

19,878

Occupancy expense

3,644

3,584

Computer and equipment expense

2,676

2,463

Professional services expense

5,817

4,742

FDIC and State assessments

1,738

2,489

Marketing expense

437

1,406

Other real estate owned expense

623

4,693

Operations of affordable housing investments 

1,695

1,960

Amortization of core deposit intangibles

1,396

1,457

Cost associated with debt redemption

5,645

2,750

Other operating expense

2,604

2,449




Total non-interest expense

49,128

47,871




Income before income tax expense

45,885

45,611

Income tax expense

16,887

16,547

Net income

28,998

29,064

     Less: net income attributable to noncontrolling interest

151

151

Net income attributable to Cathay General Bancorp

28,847

28,913




Dividends on preferred stock and noncash charge from repayment

(5,184)

(4,117)

Net income attributable to common stockholders

$      23,663

$      24,796




Net income attributable to common stockholders per common share:



Basic

$          0.30

$          0.32

Diluted

$          0.30

$          0.32




Cash dividends paid per common share

$          0.01

$          0.01

Basic average common shares outstanding

78,795,564

78,678,645

Diluted average common shares outstanding

78,815,141

78,690,132

 

 

CATHAY GENERAL BANCORP

AVERAGE BALANCES – SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited)





For the three months ended,

(In thousands)

March 31, 2013


March 31, 2012


December 31, 2012










Interest-earning assets

Average Balance

Average Yield/Rate (1) (2)


Average Balance

Average Yield/Rate (1) (2)


Average Balance

Average Yield/Rate (1) (2)

Loans (1)

$   7,386,866

4.88%


$    6,997,586

5.21%


$   7,318,749

4.96%

Taxable investment securities 

2,006,091

2.38%


2,323,166

3.07%


2,005,074

2.45%

Tax-exempt investment securities  (2)

124,182

4.86%


133,094

4.89%


130,927

4.83%

FHLB stock

41,041

2.47%


52,627

0.50%


43,290

2.71%

Federal funds sold and securities purchased under agreements to resell

 

-

 

-


 

22,802

 

0.09%


 

-

 

-

Deposits with banks

196,615

0.43%


267,157

0.88%


405,467

0.44%










Total interest-earning assets

$   9,754,795

4.26%


$    9,796,432

4.54%


$   9,903,507

4.25%










Interest-bearing liabilities









Interest-bearing demand deposits

$      600,110

0.16%


$       465,921

0.15%


$      568,762

0.16%

Money market deposits

1,164,125

0.55%


976,109

0.57%


1,200,528

0.55%

Savings deposits

466,952

0.08%


424,198

0.08%


469,249

0.08%

Time deposits

3,878,847

0.80%


4,395,102

1.08%


3,958,704

0.83%

Total interest-bearing deposits

$   6,110,034

0.63%


$    6,261,330

0.86%


$   6,197,243

0.65%

Securities sold under agreements to repurchase

1,197,222

3.86%


1,400,000

4.21%


1,288,587

3.92%

Other borrowed funds

48,807

0.66%


30,117

0.71%


41,290

0.71%

Long-term debt

171,136

2.19%


171,136

3.10%


171,136

2.92%

Total interest-bearing liabilities

7,527,199

1.18%


7,862,583

1.51%


7,698,256

1.25%










Non-interest-bearing demand deposits

1,221,552



1,071,387



1,236,304











Total deposits and other borrowed funds

$   8,748,751



$    8,933,970



$   8,934,560











Total average assets

$ 10,464,464



$  10,551,170



$ 10,641,799


Total average equity

$   1,632,773



$    1,534,973



$   1,625,065











(1)

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

(2)

The average yield has been adjusted to a fully taxable-equivalent basis for certain securities of states and political subdivisions and other securities held using a statutory Federal income tax rate of 35%.

 

SOURCE Cathay General Bancorp



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