Read Larry Connors' blog – Short Term Trading Strategies
"From the onset of the economic downturn, our strong capital levels have allowed East West to accelerate the resolution of problem assets compared to peers. During the third quarter, we successfully worked towards our goal of putting our credit issues behind us by the end of 2009," stated Dominic Ng, Chairman, President and Chief Executive Officer of East West. "We actively reduced exposures to problem credits - lowering land and construction loan balances by a substantial $355.6 million or 25% quarter over quarter and selling $206.3 million of loans and real estate owned."
Ng continued, "For the banking industry in general, the economic indicators signal that the next few quarters will still remain challenging due to the weak economy and high levels of unemployment. However, we believe that for East West, credit issues have peaked in the third quarter of 2009. As a direct result of our strategy to accelerate the resolution of problem loans, we have substantially less credit issues and expect that both provision for loan losses and charge-offs will be reduced in future quarters."
"With the proactive measures we have taken to reduce credit exposures and increase capital levels, we are in a position to both grow organically and through any potential acquisitions. The measures we have taken to fortify our balance sheet are further solidified by our strong core profitability of $63.0 million for the quarter and growing net interest margin of 3.20% for the quarter. We are in a position of strength to opportunistically increase market share and to return to profitability in 2010," concluded Ng.
Third Quarter 2009 Highlights
-- Reduction in Problem Credits -- Land and construction exposures decreased by 25% or $355.6 million in the third quarter. We continued to actively sell problem loans and REO assets and sold a total of $206.3 million during the quarter, which accelerated charge-offs by $60.1 million for the quarter.
-- Reduction in Delinquent Loans - For the second consecutive quarter, loans delinquent 30 or more days decreased. As of September 30, 2009, loans 30 to 89 days delinquent fell to 1.01% of total loans. Loan delinquencies fell across all categories -- 30 to 59 day delinquent loans decreased 63% or $37.3 million, 60 to 89 day delinquent loans decreased $27.1 million or 30%, and 90+ days delinquent loans decreased $7.4 million or 5.0%, quarter over quarter.
-- Allowance for Loan Losses Strengthened -- Total allowance for loan losses increased to $230.7 million, representing 2.74% of outstanding loans compared to 2.62% of outstanding loans in the previous quarter. We continued to strengthen the allowance for loan losses, recording provision for loan losses of $159.2 million and total net charge-offs of $151.2 million for the quarter. The allowance for loan losses to nonaccrual loan ratio was 113% as of September 30, 2009.
-- Strengthening Net Interest Margin -- Net interest income for the third quarter increased to $95.9 million, a 9% or $7.6 million increase over second quarter of 2009 and a 20% or $16.2 million increase over first quarter of 2009. The net interest margin for third quarter increased to 3.20%, up 22 basis points from 2.98% in the prior quarter.
-- Strong Core Deposit Growth -- Total core deposits reached a record high of $4.4 billion as of September 30, 2009, up 9% or $357.7 million from June 30, 2009. With the strong core deposit growth, we reduced the cost of deposits for the quarter to 1.24%, down 23 basis point from 1.47% in the prior quarter.
-- Strong Core Operating Earnings -- Core operating earnings, excluding the impact of provision for loan losses, investment securities and REO write-downs and nonrecurring FDIC assessments totaled $63.0 million for the third quarter, a 12% or $7.0 million increase from second quarter and a 28% or $13.7 million increase from first quarter. The strong core operating earnings resulted in an efficiency ratio of 40% for the third quarter of 2009, down from 55% in the second quarter of 2009.
-- Capital Strengthened -- In July 2009, East West raised $80.3 million in an oversubscribed common stock offering. During the second and third quarters of 2009, East West took actions to further strengthen capital and increased tangible common equity by $249 million. As of September 30, 2009, East West's Tier 1 risk-based capital ratio was 13.08%, significantly higher than the well capitalized requirement of 6.00%.
Credit Quality
During the third quarter, East West continued to execute on its strategy to de-risk the loan portfolio and reduce exposure to problem credits. East West sold $180.6 million in loans and $25.7 million in REO assets, or a total of $206.3 million or 85 loans and properties during the third quarter. These sales of problem loans and REO assets resulted in additional charge-offs of $60.1 million for the third quarter. East West has consistently applied its strategy of accelerating the resolution of problem assets. Although this approach has led to accelerated charge-offs, management believes that these were prudent actions that significantly reduced overall risk.
Excluding the land and construction portfolios which are discussed in more detail below, both delinquent and nonaccrual loans remain low for all other loan categories, as shown in the table below. Both delinquent and nonaccrual loans are only 1% of the total loan balance for income producing commercial real estate loans.
Loan Credit Quality Composition at September 30, 2009
(in millions)
Loan Balance Nonaccrual Loans Nonaccrual Loans % of Loans Total Delinquent Loans Delinquent % of Loans
Real estate - single family $ 912.4 $ 6.2 0.7 % $ 19.8 2.2 %
Real estate - multifamily 1,036.9 11.9 1.1 % 24.5 2.4 %
Real estate - commercial 3,624.5 33.4 0.9 % 43.5 1.2 %
Real estate - land 415.2 57.2 13.8 % 43.2 10.4 %
Real estate - construction 654.1 65.8 10.1 % 69.9 10.7 %
Commercial 1,110.4 25.0 2.3 % 17.4 1.6 %
Trade finance 233.1 3.9 1.7 % 5.5 2.4 %
Consumer 432.9 1.0 0.2 % 1.0 * 0.2 %
Total gross loans receivable $ 8,419.5 $ 204.4 2.4 % $ 224.8 2.7 %
* Delinquent student loans that are fully guaranteed by the U.S. government are excluded from these amounts.
Land and Construction Loan Exposures
(in millions)
December 31, 2007 December 31, 2008 June 30, September 30, 2009
2009
Land $ 681 $ 577 $ 480 $ 415
Construction:
Funded commitment (balance) 1,547 1,261 945 654
Unfunded commitment 994 372 176 128
Total construction exposure $ 2,541 $ 1,633 $ 1,121 $ 782
Total land and construction exposure $ 3,222 $ 2,210 $ 1,601 $ 1,197
The aggressive actions East West has taken to reduce credit risk has accelerated the timing of charge-offs but has resulted in a significant decrease in the exposure to land and construction loans, the loan categories that have shown the most weakness during this prolonged economic recession. Since December 31, 2007, East West has reduced total exposure to land and construction loans by $2.0 billion or 63%. As of September 30, 2009, land and construction loan balances were reduced to $415.2 million and $654.1 million, respectively, down $355.6 million or 25% from June 30, 2009. Management has continued to decrease exposure to land and construction loans through payoffs, pay downs and note sales and anticipates that by the end of the fourth quarter of 2009, the remaining exposures to these loan categories will be further reduced.
Delinquent Loans Trend
(in millions) As of the Quarter Ended
March 31, 2009 June 30, 2009 September 30, 2009
Loans delinquent 30-59 days $ 189.9 $ 59.1 $ 21.8
Loans delinquent 60-89 days 115.9 90.1 63.0
Loans delinquent 90+ Days 178.8 147.4 140.0
Total delinquent loans $ 484.6 $ 296.6 $ 224.8
Total loans receivable $ 8,064.3 $ 8,529.0 $ 8,419.5
Delinquent loans to total loans ratio 6.01 % 3.48 % 2.67 %
Total loan delinquencies as of September 30, 2009 decreased by $71.8 million or 24% from the prior quarter, marking the second consecutive quarter that loan delinquencies have decreased. Loan delinquency fell across all delinquency categories and loan types, but particularly for early stage delinquencies. The decrease in delinquent loans is primarily due to fewer migrations into delinquency categories, the sale of problem loans, and the payoff and resolution of delinquent loans.
Total nonperforming assets as of September 30, 2009 were $230.2 million or 1.84% of total assets, compared to $189.4 million or 1.49% of total assets at June 30, 2009 and $286.6 million or 2.28% of total assets at March 31, 2009. Nonperforming loans increased quarter over quarter largely due to land loans that are current or otherwise under 90 days delinquent that were placed on nonaccrual. We continue to proactively recognize problem credits. All nonaccrual loans are reviewed for potential impairment and shortfalls in collateral are charged-off.
During the third quarter, we recorded $159.2 million provision for loan losses, increasing the allowance for loan losses at September 30, 2009 to $230.7 million or 2.74% of outstanding loans. This compares to $223.7 million or 2.62% of outstanding loans at June 30, 2009. For the third quarter of 2009, East West had net charge-offs of $151.2 million, of which approximately two-thirds related to land and construction loans. Management believes that both provision for loan losses and charge-offs have peaked and that although they may continue to be elevated in the near future, the levels will be lower than third quarter of 2009.
The allowance for loan losses of $230.7 million was 113% of nonaccrual loans and 103% of delinquent loans as of September 30, 2009. As of September 30, 2009, East West's allowance coverage to nonaccrual loans and delinquent loans is higher than peers, reflecting our aggressive stance in removing problem credits from our balance sheet and charging off shortfalls in collateral value. Further, East West's nonaccrual loan and nonperforming asset levels are substantially below peers.
CRE Portfolio Performing Well
East West's income producing commercial real estate loans totaling $3.6 billion continues to perform well. Total delinquent and nonaccrual loans in this category remain low at only 1% of total loans. Total income producing commercial real estate loan charge-offs totaled $23.1 million for the third quarter, largely due to four loans which were sold during the quarter. These loans were construction take-out loans or otherwise projects which never fully leased up and not typical of our income producing commercial real estate portfolio.
CRE Loan Portfolio LTV and Maturity Composition at September 30, 2009
LTV Distribution * Maturity Year Less Than 50% 35 % 2009 5.5 % 50%-55% 12 % 2010 6.4 % 55%-60% 15 % 2011 6.9 % 60%-65% 19 % 2012 5.8 % 65%-70% 10 % 2013 7.0 % 70%-75% 6 % 2014 16.0 % 75% and Above 3 % 2015 and Beyond 52.4 % Total CRE Loans 100 % Total CRE Loans 100.0 % Weighted Average LTV 54 % Weighted Average Maturity 2015
* The LTV distribution is calculated based on the original appraisal value at the origination date divided by the current loan balance.
The vast majority of East West's income producing commercial real estate portfolio is comprised of low loan to value, seasoned loans with full personal guarantees from borrowers. Refinance risk for income producing commercial real estate loans maturing soon remain a strong risk for the industry as real estate values have fallen. For the East West income producing commercial real estate portfolio, this risk is mitigated by the low loan to values. Further, refinance risk is limited as we have single digit maturities each year for the next five years. Of the total $3.6 billion income producing commercial real estate portfolio, 81% have an original LTV of 65% or less, 68% have maturities in 2014 or beyond and 85% are variable rate loans (where borrowers have benefited from lowered debt service on their loans). Overall, we believe that due to these strong credit metrics, our income producing commercial real estate portfolio is resilient.
Loan Origination
We continue to prudently underwrite new loans, originating $334.9 million in new loans for the third quarter of 2009. The decrease in the total loan balance quarter over quarter was due to new loan production being fully offset by the successful resolution of problem loans. Year to date, we have originated a total of $970.1 million in new loans. Overall, new loan originations have steadily increased throughout 2009.
Deposit Growth
(In billions)
December 31, June 30, September 30,
2008 2009 2009
Total core deposits $ 3.40 $ 4.07 $ 4.43
Total time deposits 4.74 4.59 4.24
Total deposits $ 8.14 8.66 $ 8.67
Cost of deposits (for the quarter ended) 2.14 % 1.47 % 1.24 %
Total deposits increased to $8.7 billion as of September 30, 2009, $9.7 million higher compared to June 30, 2009. Total core deposits reached a record high of $4.4 billion as of September 30, 2009, up 9% or $357.7 million from June 30, 2009. We experienced growth in all core deposits - noninterest bearing demand, interest checking, money market and savings. In particular, money market deposits increased to a record $2.3 billion, a $263.9 million or 13% increase from June 30, 2009.
The deposit growth for the quarter was net of a $210.0 million reduction in brokered deposits. We continue to reduce our reliance on brokered deposits as we manage our cost of deposits and funding needs.
The cost of deposits decreased to 1.24% for the third quarter of 2009, a decrease of 23 basis points from 1.47% in the second quarter of 2009. The decrease in the cost of deposits was driven by the substantial increase in core deposits and a decreased reliance on time deposits.
Capital Strength
(Dollars in millions)
September 30, Well Capitalized Total Excess
2009 Regulatory Above Well
Requirement Capitalized
Requirement
Tier 1 leverage capital ratio 10.62 % 5.00 % $ 691.70
Tier 1 risk-based capital ratio 13.08 % 6.00 % 707.50
Total risk-based capital ratio 15.13 % 10.00 % 512.40
Tangible common equity to risk weighted assets ratio 7.98 % 4.00 % * 397.96
* The tangible common equity to risk weighted asset ratio is a non-GAAP disclosure. See reconciliation of the GAAP financial measure to this non-GAAP financial measure in the tables attached. As there is no stated regulatory guideline for this ratio, the Supervisory Capital Assessment Program (SCAP) guideline of 4.00% has been used.
East West has always been committed to maintaining strong capital levels and has been well capitalized throughout this economic cycle. During the second and third quarters of 2009, East West took actions to further strengthen capital and increased tangible common equity by $249 million. As of the end of the third quarter, East West significantly exceeded well capitalized requirements under all regulatory guidelines.
Third Quarter 2009 Operating Results
Net interest income for the third quarter totaled $95.9 million, a 9% increase over second quarter of 2009. The net interest margin for the third quarter was 3.20%, a 22 basis point increase from 2.98% in the prior quarter. The net interest margin continues to strengthen due to increases in core deposits, ongoing downward repricing of maturing higher cost time deposits and money market deposits and the ongoing pay-downs of higher cost term FHLB borrowings. During the third quarter, East West paid down $250.0 million in FHLB advances at an average cost of 5.14%. East West expects to pay down another $200.0 million at an average cost of 4.43% in the fourth quarter of 2009.
Currently, we estimate that the net interest margin will be approximately 3.35% to 3.40% for the fourth quarter of 2009.
Excluding the non-cash charge for impairment of investment securities and gains on sales of investment securities, noninterest income for the third quarter totaled $10.2 million, a 7% increased from $9.6 million in the second quarter of 2009. See reconciliation of the GAAP financial measure to this non-GAAP financial measure in the tables attached. In the third quarter of 2009, we recorded $24.2 million write-downs on investment securities for other-than-temporary impairment on bank pooled trust preferred securities. Previously, we recorded other-than-temporary impairment on bank pooled trust preferred securities of $37.4 million in the second quarter of 2009.
Noninterest expense totaled $46.1 million for the third quarter 2009, a decrease of $11.8 million from the second quarter of 2009. The decrease in noninterest expense quarter over quarter was primarily due to the reduction in OREO expense of $7.9 million. The efficiency ratio continued to improve, totaling 40% for the third quarter of 2009.
Dividend Payout
East West Bancorp's Board of Directors has declared fourth quarter dividends on the common stock and remaining Series A Preferred Stock. The common stock cash dividend of $0.01 is payable on or about November 24, 2009 to shareholders of record on November 10, 2009. The dividend on the Series A Preferred Stock of $20.00 per share is payable on November 1, 2009 to shareholders of record on October 15, 2009. We will continue to review the dividend policy quarterly in light of the current economic environment.
About East West
East West Bancorp [NASDAQ: EWBC] is a publicly owned company with $12.5 billion in assets. The Company's wholly owned subsidiary, East West Bank, is FDIC insured and the second largest full service commercial bank headquartered in Southern California with 71 branch locations. East West Bank serves the community with 69 branch locations throughout the counties of Los Angeles, Orange, San Bernardino, Alameda, San Francisco, Santa Clara, San Mateo and one branch location in Houston, Texas. East West Bank has four international locations in Greater China, which include a full service branch in Hong Kong and representative offices in Beijing, Shanghai and Taipei. In addition to serving the mainstream market, East West is also one of the largest financial institutions in the nation serving the Chinese-American community. For more information on East West Bancorp, visit the Company's website at www.eastwestbank.com.
Forward-Looking Statements
This release may contain forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and accordingly, the cautionary statements contained in East West Bancorp's Annual Report on Form 10-K for the year ended Dec. 31, 2008 (See Item I -- Business, and Item 7 -- Management's Discussion and Analysis of Consolidated Financial Condition and Results of Operations), and other filings with the Securities and Exchange Commission are incorporated herein by reference. These factors include, but are not limited to: the effect of interest rate and currency exchange fluctuations; competition in the financial services market for both deposits and loans; EWBC's ability to efficiently incorporate acquisitions into its operations; the ability of borrowers to perform as required under the terms of their loans; effect of additional provisions for loan losses; effect of any goodwill impairment, the ability of EWBC and its subsidiaries to increase its customer base; the effect of regulatory and legislative action, including California tax legislation and an announcement by the state's Franchise Tax Board regarding the taxation of Registered Investment Companies; risks inherent in possible acquisitions and FDIC-assisted transactions; and regional and general economic conditions. Actual results and performance in future periods may be materially different from any future results or performance suggested by the forward-looking statements in this release. Such forward-looking statements speak only as of the date of this release. East West expressly disclaims any obligation to update or revise any forward-looking statements found herein to reflect any changes in the Bank's expectations of results or any change in event.
EAST WEST BANCORP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
(unaudited)
September 30, 2009 June 30, 2009 December 31, 2008
Assets
Cash and due from banks $ 132,569 $ 148,913 $ 144,486
Short-term investments 460,665 424,201 734,367
Interest-bearing deposits in other banks 320,860 554,293 228,441
Securities purchased under resale agreements 75,000 75,000 50,000
Investment securities held-to-maturity, at amortized cost 781,331 794,840 122,317
Investment securities available-for-sale, at fair value 1,457,023 1,381,810 2,040,194
Loans receivable (net of allowance for loan losses
of $230,650, $223,700 and $178,027) 8,156,838 8,289,229 8,069,377
Other real estate owned, net 24,185 27,188 38,302
Premiums on deposits acquired, net 17,904 18,973 21,190
Goodwill 337,438 337,438 337,438
Other assets 722,117 667,630 636,704
Total assets $ 12,485,930 $ 12,719,515 $ 12,422,816
Liabilities and Stockholders' Equity
Deposits $ 8,668,557 $ 8,658,818 $ 8,141,959
Federal funds purchased 3,022 22 28,022
Federal Home Loan Bank advances 923,216 1,173,238 1,353,307
Securities sold under repurchase agreements 1,019,450 1,020,080 998,430
Notes payable 7,111 11,578 16,506
Long-term debt 235,570 235,570 235,570
Accrued expenses and other liabilities 107,222 143,441 98,256
Total liabilities 10,964,148 11,242,747 10,872,050
Stockholders' equity 1,521,782 1,476,768 1,550,766
Total liabilities and stockholders' equity $ 12,485,930 $ 12,719,515 $ 12,422,816
Book value per common share $ 12.58 $ 15.65 $ 16.92
Number of common shares at period end 91,694 64,032 63,746
Ending Balances
September 30, 2009 June 30, 2009 December 31, 2008
Loans receivable
Real estate - single family $ 912,391 $ 883,447 $ 491,315
Real estate - multifamily 1,036,932 1,017,803 677,989
Real estate - commercial 3,624,469 3,510,248 3,472,000
Real estate - land 415,228 479,808 576,564
Real estate - construction 654,115 945,107 1,260,724
Commercial 1,110,373 1,143,526 1,210,260
Trade finance 233,123 269,150 343,959
Consumer 432,844 279,872 216,642
Total gross loans receivable 8,419,475 8,528,961 8,249,453
Unearned fees, premiums and discounts (31,987 ) (16,032 ) (2,049 )
Allowance for loan losses (230,650 ) (223,700 ) (178,027 )
Net loans receivable $ 8,156,838 $ 8,289,229 $ 8,069,377
Deposits
Noninterest-bearing demand $ 1,397,217 $ 1,326,952 $ 1,292,997
Interest-bearing checking 347,745 338,696 363,285
Money market 2,263,319 1,999,464 1,323,402
Savings 420,365 405,837 420,133
Total core deposits 4,428,646 4,070,949 3,399,817
Time deposits less than $100,000 1,062,575 1,121,648 1,521,988
Time deposits $100,000 or greater 3,177,336 3,466,221 3,220,154
Total time deposits 4,239,911 4,587,869 4,742,142
Total deposits $ 8,668,557 $ 8,658,818 $ 8,141,959
EAST WEST BANCORP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(unaudited)
Quarter Ended
September 30, 2009 June 30, 2009 September 30, 2008
Interest and dividend income $ 147,924 $ 146,333 $ 159,862
Interest expense (52,044 ) (58,073 ) (73,347 )
Net interest income before provision for loan losses 95,880 88,260 86,515
Provision for loan losses (159,244 ) (151,422 ) (43,000 )
Net interest (loss) income after provision for loan losses (63,364 ) (63,162 ) 43,515
Noninterest (loss) income (11,880 ) (26,199 ) (43,550 )
Noninterest expense (46,064 ) (57,912 ) (48,526 )
Loss before benefit for income taxes (121,308 ) (147,273 ) (48,561 )
Benefit for income taxes 52,777 60,548 17,355
Loss before extraordinary item $ (68,531 ) $ (86,725 ) $ (31,206 )
Extraordinary item, net of tax - (5,366 ) -
Net loss after extraordinary item $ (68,531 ) $ (92,091 ) $ (31,206 )
Preferred stock dividend, inducement, and amortization of preferred (10,620 ) (23,623 ) (4,089 )
stock discount
Net loss available to common stockholders $ (79,151 ) $ (115,714 ) $ (35,295 )
Net loss per share, basic $ (0.91 ) $ (1.83 ) $ (0.56 )
Net loss per share, diluted $ (0.91 ) $ (1.83 ) $ (0.56 )
Shares used to compute per share net loss:
- Basic 86,538 63,105 62,675
- Diluted 86,538 63,105 62,675
Quarter Ended
September 30, 2009 June 30, 2009 September 30, 2008
Noninterest (loss) income:
Impairment loss on investment securities $ (24,249 ) $ (37,447 ) $ (53,567 )
Branch fees 4,679 4,991 4,285
Net gain on sale of investment securities 2,177 1,680 -
Letters of credit fees and commissions 1,984 1,930 2,319
Ancillary loan fees 1,227 1,356 1,783
Net gain on sale of loans 8 3 144
Other operating income 2,294 1,288 1,486
Total noninterest (loss) income $ (11,880 ) $ (26,199 ) $ (43,550 )
Noninterest expense:
Compensation and employee benefits $ 15,875 $ 16,509 $ 17,520
Occupancy and equipment expense 6,262 6,297 6,817
Deposit insurance premiums and regulatory assessments 6,057 9,568 1,678
Amortization of investments in affordable housing partnerships 1,709 1,652 1,886
Legal expense 1,323 1,755 855
Data processing 1,079 1,141 1,055
Amortization and impairment loss of premiums on deposits acquired 1,069 1,092 1,581
Other real estate owned expense 767 8,682 2,123
Consulting expense 759 672 1,254
Other operating expense 11,164 10,544 13,757
Total noninterest expense $ 46,064 $ 57,912 $ 48,526
EAST WEST BANCORP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(unaudited)
Year To Date
September 30, 2009 September 30, 2008 % Change
Interest and dividend income $ 439,180 $ 514,951 (15 )
Interest expense (175,359 ) (236,641 ) (26 )
Net interest income before provision for loan losses 263,821 278,310 (5 )
Provision for loan losses (388,666 ) (183,000 ) 112
Net interest (loss) income after provision for loan losses (124,845 ) 95,310 (231 )
Noninterest loss (24,285 ) (24,199 ) 0
Noninterest expense (155,382 ) (157,071 ) (1 )
Loss before benefit for income taxes (304,512 ) (85,960 ) 254
Benefit for income taxes 126,790 33,911 274
Net loss before extraordinary items $ (177,722 ) $ (52,049 ) 241
Extraordinary item, net of tax $ (5,366 ) $ - NA
Net loss after extraordinary item $ (183,088 ) $ (52,049 ) 252
Preferred stock dividend, inducement, and amortization of preferred (42,986 ) (4,089 ) 951
stock discount
Net loss available to common stockholders $ (226,074 ) $ (56,138 ) 303
Net loss per share, basic $ (3.19 ) $ (0.90 ) 254
Net loss per share, diluted $ (3.19 ) $ (0.90 ) 254
Shares used to compute per share net loss:
- Basic 70,967 62,586 13
- Diluted 70,967 62,586 13
Year To Date
September 30, 2009 September 30, 2008 % Change
Noninterest loss:
Impairment loss on investment securities $ (61,896 ) $ (63,512 ) (3 )
Branch fees 14,463 12,725 14
Net gain on sale of investment securities 7,378 7,767 (5 )
Letters of credit fees and commissions 5,768 7,472 (23 )
Ancillary loan fees 4,812 3,908 23
Net gain on sale of loans 19 2,272 (99 )
Other operating income 5,171 5,169 0
Total noninterest loss $ (24,285 ) $ (24,199 ) (0 )
Noninterest expense:
Compensation and employee benefits $ 49,492 $ 66,578 (26 )
Occupancy and equipment expense 19,950 20,364 (2 )
Deposit insurance premiums and regulatory assessments 18,950 5,191 265
Other real estate owned expense 16,480 3,520 368
Amortization of investments in affordable housing partnerships 5,121 5,521 (7 )
Legal expense 4,856 3,890 25
Data processing 3,362 3,386 (1 )
Amortization and impairment loss of premiums on deposits acquired 3,286 6,145 (47 )
Consulting expense 1,879 3,788 (50 )
Other operating expense 32,006 38,688 (17 )
Total noninterest expense $ 155,382 $ 157,071 (1 )
EAST WEST BANCORP, INC
DELINQUENT LOANS BY LOAN CATEGORIES
(in thousands)
(unaudited)
As of September 30, 2009
Loan Type 30-59 Days Delinquent 60-89 Days Delinquent 90+ Days Delinquent Total Delinquent Loans
Real estate - single family $ - $ 13,577 $ 6,189 $ 19,766
Real estate - multifamily 4,811 8,506 11,211 24,528
Real estate - commercial 9,184 16,896 17,381 43,461
Real estate - land 1,521 18,135 23,568 43,224
Real estate - residential construction - 3,971 55,130 59,101
Real estate - commercial construction - - 10,784 10,784
Commercial 4,235 1,363 11,783 17,381
Trade finance 1,785 32 3,666 5,483
Consumer (1) 277 470 293 1,040
Total Delinquent Loans $ 21,813 $ 62,950 $ 140,005 $ 224,768
(1) This figure excludes delinquent student loans that are fully
guaranteed by the U.S. government. As of September 30, 2009, $13.8
million of student loans were 30-59 days delinquent and $17.0
million student loans were 60-89 days delinquent. There were no
student loans 90+ days delinquent.
As of June 30, 2009
Loan Type 30-59 Days Delinquent 60-89 Days Delinquent 90+ Days Delinquent Total Delinquent Loans
Real estate - single family $ 553 $ 6,775 $ 5,181 $ 12,509
Real estate - multifamily 1,960 5,618 7,938 15,516
Real estate - commercial 33,416 28,341 19,786 81,543
Real estate - land 1,570 22,190 35,660 59,420
Real estate - residential construction 17,331 6,789 46,176 70,296
Real estate - commercial construction - - 20,629 20,629
Commercial 4,021 19,480 8,034 31,535
Trade finance - 408 3,706 4,114
Consumer 244 458 339 1,041
Total Delinquent Loans $ 59,095 $ 90,059 $ 147,449 $ 296,603
As of March 31, 2009
Loan Type 30-59 Days Delinquent 60-89 Days Delinquent 90+ Days Delinquent Total Delinquent Loans
Real estate - single family $ 31,105 $ 4,226 $ 18,515 $ 53,846
Real estate - multifamily 17,310 2,585 9,863 29,758
Real estate - commercial 68,964 25,929 12,465 107,358
Real estate - land 12,835 8,969 63,052 84,856
Real estate - residential construction 31,166 61,286 28,433 120,885
Real estate - commercial construction 19,512 4,545 28,604 52,661
Commercial 4,317 3,751 16,798 24,866
Trade finance 4,123 4,468 177 8,768
Consumer 613 110 839 1,562
Total Delinquent Loans $ 189,945 $ 115,869 $ 178,746 $ 484,560
As of December 31, 2008
Loan Type 30-59 Days Delinquent 60-89 Days Delinquent 90+ Days Delinquent Total Delinquent Loans
Real estate - single family $ 16,708 $ 6,237 $ 13,519 $ 36,464
Real estate - multifamily 9,372 2,382 11,845 23,599
Real estate - commercial 21,036 18,364 24,680 64,080
Real estate - land 9,335 19,002 66,185 94,522
Real estate - residential construction 13,242 9,379 27,052 49,673
Real estate - commercial construction - - 30,581 30,581
Commercial 3,970 13,918 6,570 24,458
Trade finance 374 - 65 439
Consumer 1,326 252 1,654 3,232
Total Delinquent Loans $ 75,363 $ 69,534 $ 182,151 $ 327,048
EAST WEST BANCORP, INC
TOTAL NON-PERFORMING ASSETS
(in thousands)
(unaudited)
As of September 30, 2009
Total Nonaccrual Loans
90+ Days Delinquent Under 90+ Days Delinquent Total Nonaccrual Loans 90+ Days Total Non-performing Loans REO Assets Total
Delinquent Not Non-Performing Assets
On Nonaccrual
Loan Type
Real estate - single family $ 6,189 $ - $ 6,189 $ - $ 6,189 $ 648 $ 6,837
Real estate - multifamily 11,211 652 11,863 - 11,863 1,147 13,010
Real estate - commercial 17,381 16,040 33,421 - 33,421 2,330 35,751
Real estate - land 23,568 33,610 57,178 - 57,178 4,020 61,198
Real estate - residential construction 55,130 - 55,130 - 55,130 12,238 67,368
Real estate - commercial construction 10,784 - 10,784 - 10,784 3,680 14,464
Commercial 11,783 13,227 25,010 - 25,010 122 25,132
Trade Finance 2,110 1,785 3,895 1,556 5,451 - 5,451
Consumer 293 676 969 - 969 - 969
Total $ 140,005 $ 65,990 $ 205,995 $ 1,556 $ 205,995 $ 24,185 $ 230,180
As of June 30, 2009
Total Nonaccrual Loans
90+ Days Delinquent Under 90+ Days Delinquent Total Nonaccrual Loans 90+ Days Total Non-performing Loans REO Assets Total
Delinquent Not Non-Performing Assets
On Nonaccrual
Loan Type
Real estate - single family $ 5,181 $ - $ 5,181 $ - $ 5,181 $ 4,921 $ 10,102
Real estate - multifamily 7,938 - 7,938 - 7,938 281 8,219
Real estate - commercial 19,786 4,590 24,376 - 24,376 2,887 27,263
Real estate - land 35,660 1,656 37,316 - 37,316 13,307 50,623
Real estate - residential construction 46,176 - 46,176 - 46,176 4,154 50,330
Real estate - commercial construction 20,629 - 20,629 - 20,629 - 20,629
Commercial 8,034 8,067 16,101 - 16,101 626 16,727
Trade Finance 3,706 - 3,706 - 3,706 211 3,917
Consumer 339 412 751 - 751 801 1,552
Total $ 147,449 $ 14,725 $ 162,174 $ - $ 162,174 $ 27,188 $ 189,362
As of March 31, 2009
Total Nonaccrual Loans
90+ Days Delinquent Under 90+ Days Delinquent Total Nonaccrual Loans 90+ Days Total Non-performing Loans REO Assets Total
Delinquent Not Non-Performing Assets
On Nonaccrual
Loan Type
Real estate - single family $ 18,515 $ 634 $ 19,149 $ - $ 19,149 $ 671 $ 19,820
Real estate - multifamily 9,863 - 9,863 - 9,863 887 10,750
Real estate - commercial 12,465 42,724 55,189 - 55,189 4,240 59,429
Real estate - land 63,052 6,233 69,285 - 69,285 17,934 87,219
Real estate - residential construction 28,433 14,196 42,629 - 42,629 13,278 55,907
Real estate - commercial construction 28,604 - 28,604 - 28,604 - 28,604
Commercial 16,798 5,000 21,798 - 21,798 1,236 23,034
Trade Finance 177 - 177 - 177 270 447
Consumer 839 482 1,321 - 1,321 118 1,439
Total $ 178,746 $ 69,269 $ 248,015 $ - $ 248,015 $ 38,634 $ 286,649
As of December 31, 2008
Total Nonaccrual Loans
90+ Days Delinquent Under 90+ Days Delinquent Total Nonaccrual Loans 90+ Days Total Non-performing Loans REO Assets Total
Delinquent Not Non-Performing Assets
On Nonaccrual
Loan Type
Real estate - single family $ 13,519 $ - $ 13,519 $ - $ 13,519 $ 419 $ 13,938
Real estate - multifamily 11,845 - 11,845 - 11,845 1,136 12,981
Real estate - commercial 24,680 - 24,680 - 24,680 4,882 29,562
Real estate - land 66,185 12,892 79,077 - 79,077 10,307 89,384
Real estate - residential construction 27,052 8,766 35,818 - 35,818 21,146 56,964
Real estate - commercial construction 30,581 - 30,581 - 30,581 - 30,581
Commercial 6,570 10,604 17,174 - 17,174 142 17,316
Trade Finance 65 - 65 - 65 270 335
Consumer 1,654 194 1,848 - 1,848 - 1,848
Total $ 182,151 $ 32,456 $ 214,607 $ - $ 214,607 $ 38,302 $ 252,909
EAST WEST BANCORP, INC.
QUARTERLY ALLOWANCE FOR LOAN LOSSES RECAP
(In thousands)
(unaudited)
Quarter Ended
9/30/2009 6/30/2009 3/31/2009
LOANS
Allowance balance, beginning of period $ 223,700 $ 195,450 $ 178,027
Allowance for unfunded loan commitments and letters of credit (1,051 ) 1,442 (1,008 )
Provision for loan losses 159,244 151,422 78,000
Impact of desecuritization - 9,262 -
Net Charge-offs:
Real estate - single family 8,034 14,058 3,832
Real estate - multifamily 7,231 2,256 1,624
Real estate - commercial 23,105 12,472 2,790
Real estate - land 39,988 33,183 12,523
Real estate - residential construction 32,535 30,634 16,347
Real estate - commercial construction 23,051 28,602 1,977
Commercial 14,956 11,577 18,146
Trade finance 2,256 774 1,032
Consumer 87 320 1,298
Total net charge-offs 151,243 133,876 59,569
Allowance balance, end of period $ 230,650 $ 223,700 $ 195,450
UNFUNDED LOAN COMMITMENTS AND LETTERS OF CREDIT:
Allowance balance, beginning of period $ 5,907 $ 7,349 $ 6,341
Provision for unfunded loan commitments and letters of credit 1,051 (1,442 ) 1,008
Allowance balance, end of period $ 6,958 $ 5,907 $ 7,349
GRAND TOTAL, END OF PERIOD $ 237,608 $ 229,607 $ 202,799
Nonperforming assets to total assets 1.84 % 1.49 % 2.28 %
Allowance for loan losses to total gross loans at end of period 2.74 % 2.62 % 2.42 %
Allowance for loan losses and unfunded loan commitments to total 2.82 % 2.69 % 2.51 %
gross loans at end of period
Allowance to nonaccrual loans at end of period 112.82 % 137.94 % 78.81 %
Nonaccrual loans to total loans 2.43 % 1.90 % 3.08 %
EAST WEST BANCORP, INC.
QUARTER TO DATE AVERAGE BALANCES, YIELDS AND RATES PAID
(In thousands)
(unaudited)
Quarter Ended
September 30, 2009 June 30, 2009
Average Average
Volume Interest Yield (1) Volume Interest Yield (1)
ASSETS
Interest-earning assets:
Short-term investments $ 387,753 $ 402 0.41 % $ 340,142 $ 613 0.72 %
Interest bearing deposits in other banks 509,774 1,454 1.12 % 536,244 1,896 1.42 %
Securities purchased under resale agreements 91,033 2,153 9.25 % 51,374 1,292 9.95 %
Investment securities held-to-maturity
Taxable For full details on East West Bancorp Inc (EWBC) click here. East West Bancorp Inc (EWBC) has Short Term PowerRatings of 6. Details on East West Bancorp Inc (EWBC) Short Term PowerRatings is available at This Link.
More News:
Market Updates |
Stock Alerts |
All Trading News |
Stock Index
About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback
The Connors Group, Inc. ("Company") is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The analysts and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company's website, or in its publications, are made as of the date stated and are subject to change without notice.
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system, and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company's products (collectively, the "Information") are provided for informational and educational purposes only and should not be construed as investment advice. Examples presented on Company's website are for educational purposes only. Such set-ups are not solicitations of any order to buy or sell. Accordingly, you should not rely solely on the Information in making any investment. Rather, you should use the Information only as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING AND MAY NOT BE IMPACTED BY BROKERAGE AND OTHER SLIPPAGE FEES. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
The Connors Group, Inc.
10 Exchange Place, Suite 1800
Jersey City, NJ 07302
© Copyright 2009 The Connors Group, Inc.