CATHAY GENERAL BANCORP LOS ANGELES, Jan. 21, 2015 /PRNewswire/ -- Cathay General Bancorp (the "Company", NASDAQ: CATY), the holding company for Cathay Bank, today announced net income of $35.6 million, or $0.44 per share, for the fourth quarter and net income of $137.8 million for the year ended December 31, 2014.
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FINANCIAL PERFORMANCE
Three months ended December
31, Year ended December 31,
---------------------------- -----------------------
2014 2013 2014 2013
---- ---- ---- ----
Net income $35.6 million $31.9 million $137.8 million $123.1 million
Net income
available to
common
stockholders $35.6 million $31.9 million $137.8 million $113.5 million
Basic earnings per
common share $0.45 $0.40 $1.73 $1.44
Diluted earnings
per common share $0.44 $0.40 $1.72 $1.43
Return on average
assets 1.27% 1.19% 1.26% 1.17%
Return on average
total
stockholders'
equity 8.86% 8.70% 8.95% 8.00%
Efficiency ratio 42.96% 44.65% 45.48% 50.35%
FULL YEAR HIGHLIGHTS
-- Diluted earnings per share increased 10.0% to $0.44 per share for the
fourth quarter of 2014 compared to $0.40 per share for the same quarter
a year ago.
-- Total loans increased $829.5 million, or 10.3%, excluding loans held for
sale, during 2014, to $8.9 billion at December 31, 2014, compared to
$8.1 billion at December 31, 2013.
"Despite new loan origination being good, our loan growth slowed during the fourth quarter due to unusual large payoffs and paydowns of existing loans. However, we expect the loan growth for the full year 2015 to be comparable or better than the 10.3% loan growth for all of 2014," commented Dunson Cheng, Chairman of the Board, Chief Executive Officer, and President of the Company.
"We are also pleased that our core deposits increased $656 million, or 14.5%, for 2014 and we will continue to focus on growing our core deposits in 2015. We are looking forward to the completion of the merger, which was announced this morning, with Asia Bancshares, expected to be completed during second quarter of 2015, which will significantly increase our presence in New York City," concluded Dunson Cheng.
FOURTH QUARTER INCOME STATEMENT REVIEW
Net income for the quarter ended December 31, 2014, was $35.6 million, an increase of $3.7 million, or 11.5%, compared to net income of $31.9 million for the same quarter a year ago. Diluted earnings per share available to common stockholders for the quarter ended December 31, 2014, was $0.44 compared to $0.40 for the same quarter a year ago due primarily to an increase in net interest income and a higher negative provision for credit losses in 2014.
Return on average stockholders' equity was 8.86% and return on average assets was 1.27% for the quarter ended December 31, 2014, compared to a return on average stockholders' equity of 8.70% and a return on average assets of 1.19% for the same quarter a year ago.
Net interest income before provision for credit losses
Net interest income before provision for credit losses increased $5.8 million, or 7.1%, to $87.8 million during the fourth quarter of 2014 compared to $82.0 million during the same quarter a year ago. The increase was due primarily to the increase in loan interest income and the decrease in interest expense from securities sold under agreements to repurchase, offset by the decrease in interest income from available-for-sale securities.
The net interest margin, on a fully taxable-equivalent basis, was 3.36% for the fourth quarter of 2014, compared to 3.31% for the third quarter of 2014 and 3.30% for the fourth quarter of 2013. The increase in the net interest margin was due to the impact from increases in loans and decreases in securities sold under agreements to repurchase offset by decreases in investment securities.
For the fourth quarter of 2014, the yield on average interest-earning assets was 4.06%, the cost of funds on average interest-bearing liabilities was 0.93%, and the cost of interest bearing deposits was 0.66%. In comparison, for the fourth quarter of 2013, the yield on average interest-earning assets was 4.09%, the cost of funds on average interest-bearing liabilities was 1.03%, and the cost of interest bearing deposits was 0.65%. 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, increased to 3.13% for the quarter ended December 31, 2014, from 3.06% for the same quarter a year ago.
Provision for credit losses
Provision for credit losses was a credit of $2.0 million for the fourth quarter of 2014 compared to zero for the fourth quarter of 2013. The provision for credit losses was based on the review of the adequacy of the allowance for loan losses at December 31, 2014. 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 December 31, Year ended December 31,
------------------------------- -----------------------
2014 2013 2014 2013
---- ---- ---- ----
(In thousands)
Charge-offs:
Commercial loans $283 $11,045 $7,875 $15,625
Construction
loans 4,934 - 6,747 -
Real estate loans
(1) 4,286 626 7,613 3,499
Real estate-
land loans - - - 1,318
--- -----
Total charge-
offs 9,503 11,671 22,235 20,442
----- ------ ------ ------
Recoveries:
Commercial loans 867 724 12,517 2,739
Construction
loans 2,409 28 2,547 2,284
Real estate loans
(1) 351 1,749 5,752 5,978
Real estate-
land loans 98 896 109 2,997
Installment and
other loans - - 13 11
--- --- --- ---
Total recoveries 3,725 3,397 20,938 14,009
Net charge-offs $5,778 $8,274 $1,297 $6,433
====== ====== ====== ======
Real estate
loans
include
commercial
mortgage
loans,
residential
mortgage
loans, and
equity
(1) 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 $8.0 million for the fourth quarter of 2014, a decrease of $372,000, or 4.5%, compared to $8.3 million for the fourth quarter of 2013. The decrease in non-interest income in the fourth quarter of 2014 was primarily due to a decrease of $284,000 in gains on sale of securities and a decrease of $177,000 in letters of credit commissions.
Non-interest expense
Non-interest expense increased $806,000, or 2.0%, to $41.1 million in the fourth quarter of 2014 compared to $40.3 million in the same quarter a year ago. The efficiency ratio was 42.96% in the fourth quarter of 2014 compared to 44.65% for the same quarter a year ago.
Marketing expenses increased $704,000 primarily due to donations and contributions. Other real estate ("OREO") expense increased $446,000 primarily due to higher gains on sales and transfers of loans to OREO in 2013. Offsetting the increases was a $663,000 decrease in salaries and employee benefits, a $437,000 decrease in operation expenses of affordable housing investments, and a $227,000 decrease in amortization of core deposit intangibles.
Income taxes
The effective tax rate for the fourth quarter of 2014 was 37.1% compared to 36.0% for the fourth quarter of 2013. The effective tax rate includes the impact of the utilization of low income housing tax credits.
BALANCE SHEET REVIEW
Gross loans, excluding loans held for sale, were $8.91 billion at December 31, 2014, an increase of $829.5 million, or 10.3%, from $8.08 billion at December 31, 2013, primarily due to increases of $463.4 million, or 11.5%, in commercial mortgage loans, $214.8 million, or 15.9%, in residential mortgage loans, $83.8 million, or 3.6%, in commercial loans, and $77.0 million, or 34.7%, in real estate construction loans. The changes in loan balances and composition from December 31, 2013, are presented below:
December 31, 2014 December 31, 2013 % Change
----------------- ----------------- --------
(Dollars in thousands)
Commercial loans $2,382,493 $2,298,724 4
Residential
mortgage loans 1,570,059 1,355,255 16
Commercial
mortgage loans 4,486,443 4,023,051 12
Equity lines 172,879 171,277 1
Real estate
construction
loans 298,654 221,701 35
Installment &
other loans 3,552 14,555 (76)
Gross loans $8,914,080 $8,084,563 10
Allowance for
loan losses (161,420) (173,889) (7)
Unamortized
deferred loan
fees (12,392) (13,487) (8)
------- -------
Total loans, net $8,740,268 $7,897,187 11
---------- ----------
Loans held for
sale $973 $ - 100
---- ----------------------------------
Total deposits were $8.78 billion at December 31, 2014, an increase of $802.2 million, or 10.1%, from $7.98 billion at December 31, 2013, primarily due to a $251.8 million, or 19.6%, increase in money market deposits, a $231.3 million, or 24.8%, increase in time deposits under $100,000, a $223.1 million, or 15.4%, increase in non-interest bearing demand deposits, a $94.8 million, or 13.9%, increase in NOW deposits, and a $34.4 million, or 6.9%, increase in savings deposits. The changes in deposit balances and composition from December 31, 2013, are presented below:
December 31, 2014 December 31, 2013 % Change
----------------- ----------------- --------
(Dollars in thousands)
Non-
interest-
bearing
demand
deposits $1,664,914 $1,441,858 15
NOW
deposits 778,691 683,873 14
Money
market
deposits 1,538,187 1,286,338 20
Savings
deposits 533,940 499,520 7
Time
deposits
under
$100,000 1,162,547 931,204 25
Time
deposits
of
$100,000
or
more 3,105,181 3,138,512 (1)
--------- ---------
Total
deposits $8,783,460 $7,981,305 10
========== ==========
ASSET QUALITY REVIEW
At December 31, 2014, total non-accrual loans, excluding loans held for sale, were $70.2 million, a decrease of $13.0 million, or 15.7%, from $83.2 million at December 31, 2013.
The allowance for loan losses was $161.4 million and the allowance for off-balance sheet unfunded credit commitments was $1.9 million at December 31, 2014, 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 loan losses was $161.4 million at December 31, 2014, compared to $173.9 million at December 31, 2013, a decrease of $12.5 million, or 7.2%. The allowance for loan losses represented 1.81% of period-end gross loans, excluding loans held for sale, and 230.1% of non-performing loans at December 31, 2014. The comparable ratios were 2.15% of period-end gross loans, excluding loans held for sale, and 206.6% of non-performing loans at December 31, 2013. The changes in non-performing assets and troubled debt restructurings at December 31, 2014, compared to December 31, 2013, and to September 30, 2014, are highlighted below:
(Dollars in
thousands) December 31, 2014 December 31, 2013 % Change September 30, 2014 % Change
----------------- ----------------- -------- ------------------ --------
Non-performing
assets
Accruing loans past
due 90 days or more $ - $982 (100) $662 (100)
Non-accrual loans:
Construction-
residential loans 500 3,313 (85) - 100
Construction- non-
residential loans 19,463 25,273 (23) 25,728 (24)
Land loans 5,856 6,502 (10) 5,996 (2)
Commercial real
estate loans,
excluding land
loans 29,750 13,119 127 17,834 67
Commercial loans 6,983 21,232 (67) 8,851 (21)
Residential mortgage
loans 7,611 13,744 (45) 6,849 11
----- ------ -----
Total non-accrual
loans: $70,163 $83,183 (16) $65,258 8
------- ------- -------
Total non-
performing loans 70,163 84,165 (17) 65,920 6
Other real estate
owned 31,477 52,985 (41) 29,025 8
Total non-
performing assets $101,640 $137,150 (26) $94,945 7
-------- -------- -------
Accruing troubled
debt
restructurings
(TDRs) $104,356 $117,597 (11) $123,089 (15)
Non-accrual loans
held for sale $973 $ - 100 $ - 100
Allowance for loan
losses $161,420 $173,889 (7) $169,198 (5)
Allowance for off-
balance sheet
credit commitments 1,949 1,362 43 2,018 (3)
----- ----- -----
Allowance for credit
losses $163,369 $175,251 (7) $171,216 (5)
======== ======== ========
Total gross loans
outstanding, at
period-end (1) $8,914,080 $8,084,563 10 $8,858,254 1
Allowance for loan
losses to non-
performing loans,
at period-end (2) 230.06% 206.60% 256.67%
Allowance for loan
losses to gross
loans, at period-
end (1) 1.81% 2.15% 1.91%
Excludes
loans
held for
sale at
period-
(1) end.
Excludes
non-
accrual
loans
held for
sale at
period-
(2) end.
Troubled debt restructurings on accrual status totaled $104.4 million at December 31, 2014, compared to $117.6 million at December 31, 2013. 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, excluding non-accrual loans held for sale, to total assets was 0.9% at December 31, 2014, compared to 1.3% at December 31, 2013. Total non-performing assets decreased $35.6 million, or 25.9%, to $101.6 million at December 31, 2014, compared to $137.2 million at December 31, 2013, primarily due to a $13.0 million, or 15.7%, decrease in non-accrual loans and a $21.5 million, or 40.6%, decrease in OREO.
CAPITAL ADEQUACY REVIEW
At December 31, 2014, the Company's Tier 1 risk-based capital ratio of 14.97%, total risk-based capital ratio of 16.22%, and Tier 1 leverage capital ratio of 12.99%, 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, 2013, the Company's Tier 1 risk-based capital ratio was 15.04%, total risk-based capital ratio was 16.35%, and Tier 1 leverage capital ratio was 12.48%.
FULL YEAR REVIEW
Net income attributable to common stockholders for the year ended December 31, 2014, was $137.8 million, an increase of $24.3 million, or 21.5%, compared to net income attributable to common stockholders of $113.5 million for the year ended December 31, 2013, due primarily to increases in net interest income, the elimination of dividends on preferred stock, a higher negative provision for credit losses, decreases in costs associated with debt redemption, decreases in amortization of core deposit premiums, decreases in professional services expense, and decreases in OREO expense. These were partially offset by decreases in gains on sale of securities, increases in salaries and incentive compensation expense, increases in litigation expenses, and increases in FDIC and state assessments. Diluted earnings per share attributable to common stockholders for the year ended December 31, 2014, was $1.72 compared to $1.43 for the year ended December 31, 2013. The net interest margin for the year ended December 31, 2014, increased to 3.35% from 3.33% for the year ended December 31, 2013.
Return on average stockholders' equity was 8.95% and return on average assets was 1.26% for the year ended December 31, 2014, compared to a return on average stockholders' equity of 8.00% and a return on average assets of 1.17% for the year ended December 31, 2013. The efficiency ratio for the year ended December 31, 2014, was 45.48% compared to 50.35% for the year ended December 31, 2013.
CONFERENCE CALL
Cathay General Bancorp will host a conference call this afternoon to discuss its fourth quarter 2014 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 1-877-415-3180 and enter Participant Passcode 63032778. 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 33 branches in California, nine 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 Nevada, 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; 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 (the "Dodd-Frank 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; 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, 2013 (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 December 31, Year ended December 31,
------------------------------- -----------------------
(Dollars in thousands, except per
share data) 2014 2013 % Change 2014 2013 % Change
--------------------------------- ---- ---- -------- ---- ---- --------
FINANCIAL PERFORMANCE
Net interest income before provision
for credit losses $87,751 $81,962 7 $342,781 $324,696 6
Provision/(reversal) for credit
losses (2,000) - (100) (10,800) (3,000) 260
------ --- ------- ------
Net interest income after provision
for credit losses 89,751 81,962 10 353,581 327,696 8
Non-interest income 7,973 8,345 (4) 40,527 60,307 (33)
Non-interest expense 41,125 40,319 2 174,313 193,833 (10)
------ ------ ------- -------
Income before income tax expense 56,599 49,988 13 219,795 194,170 13
Income tax expense 21,021 17,946 17 81,965 70,435 16
------ ------ ------ ------
Net income 35,578 32,042 11 137,830 123,735 11
Net income attributable to
noncontrolling interest - 140 (100) - 592 (100)
Net income attributable to Cathay
General Bancorp $35,578 $31,902 12 $137,830 $123,143 12
------- ------- -------- --------
Dividends on preferred stock and
noncash charge from repayment - - - - (9,685) (100)
Net income attributable to common
stockholders $35,578 $31,902 12 $137,830 $113,458 21
======= ======= ======== ========
Net income attributable to common stockholders per common share:
Basic $0.45 $0.40 13 $1.73 $1.44 20
Diluted $0.44 $0.40 10 $1.72 $1.43 20
Cash dividends paid per common share $0.10 $0.05 100 $0.29 $0.08 263
SELECTED RATIOS
Return on average assets 1.27% 1.19% 7 1.26% 1.17% 8
Return on average total
stockholders' equity 8.86% 8.70% 2 8.95% 8.00% 12
Efficiency ratio 42.96% 44.65% (4) 45.48% 50.35% (10)
Dividend payout ratio 22.40% 12.46% 80 16.76% 5.15% 225
YIELD ANALYSIS (Fully taxable
equivalent)
Total interest-earning assets 4.06% 4.09% (1) 4.10% 4.17% (2)
Total interest-bearing liabilities 0.93% 1.03% (10) 0.97% 1.09% (11)
Net interest spread 3.13% 3.06% 2 3.13% 3.08% 2
Net interest margin 3.36% 3.30% 2 3.35% 3.33% 1
CAPITAL RATIOS December 31, 2014 December 31, 2013 September 30, 2014 Well Capitalized Requirements Minimum Regulatory Requirements
----------------- ----------------- ------------------ ----------------------------- -------------------------------
Tier 1 risk-based capital ratio 14.97% 15.04% 14.72% 6.0% 4.0%
Total risk-based capital ratio 16.22% 16.35% 16.00% 10.0% 8.0%
Tier 1 leverage capital ratio 12.99% 12.48% 12.66% 5.0% 4.0%
.
===
CATHAY GENERAL BANCORP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share and
per share data) December 31, 2014 December 31, 2013 % change
------------------------------- ----------------- ----------------- --------
Assets
Cash and due from banks $176,830 $153,747 15
Short-term investments and
interest bearing deposits 489,614 516,938 (5)
Securities available-for-sale (amortized cost of $1,324,408 in 2014 and
$1,637,965 in 2013) 1,318,935 1,586,668 (17)
Trading securities - 4,936 (100)
Loans held for sale 973 - 100
Loans 8,914,080 8,084,563 10
Less: Allowance for loan losses (161,420) (173,889) (7)
Unamortized deferred loan fees,
net (12,392) (13,487) (8)
------- -------
Loans, net 8,740,268 7,897,187 11
Federal Home Loan Bank stock 30,785 25,000 23
Other real estate owned, net 31,477 52,985 (41)
Affordable housing investments,
net 99,579 84,108 18
Premises and equipment, net 99,682 102,045 (2)
Customers' liability on
acceptances 35,656 32,194 11
Accrued interest receivable 25,364 24,274 4
Goodwill 316,340 316,340 -
Other intangible assets, net 3,237 2,230 45
Other assets 143,106 190,634 (25)
Total assets $11,511,846 $10,989,286 5
=========== ===========
Liabilities and Stockholders' Equity
Deposits
Non-interest-bearing demand
deposits $1,664,914 $1,441,858 15
Interest-bearing deposits:
NOW deposits 778,691 683,873 14
Money market deposits 1,538,187 1,286,338 20
Savings deposits 533,940 499,520 7
Time deposits under $100,000 1,162,547 931,204 25
Time deposits of $100,000 or more 3,105,181 3,138,512 (1)
--------- ---------
Total deposits 8,783,460 7,981,305 10
--------- ---------
Securities sold under agreements
to repurchase 450,000 800,000 (44)
Advances from the Federal Home
Loan Bank 425,000 521,200 (18)
Other borrowings for affordable
housing investments 19,934 19,062 5
Long-term debt 119,136 121,136 (2)
Acceptances outstanding 35,656 32,194 11
Other liabilities 75,772 55,418 37
------ ------
Total liabilities 9,908,958 9,530,315 4
--------- ---------
Commitments and contingencies - - -
--- ---
Stockholders' Equity
Common stock, $0.01 par value, 100,000,000 shares authorized,
84,022,118 issued and 79,814,553 outstanding at December 31, 2014, and
83,797,434 issued and 79,589,869
outstanding at December 31, 2013 840 838 0
Additional paid-in-capital 789,519 784,489 1
Accumulated other comprehensive
loss, net (5,569) (29,729) (81)
Retained earnings 943,834 829,109 14
Treasury stock, at cost (4,207,565 shares at December 31, 2014,
and at December 31, 2013) (125,736) (125,736) -
Total equity 1,602,888 1,458,971 10
--------- ---------
Total liabilities and equity $11,511,846 $10,989,286 5
=========== ===========
Book value per common share $20.00 $18.24 10
Number of common shares
outstanding 79,814,553 79,589,869 0
CATHAY GENERAL BANCORP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended December 31, Year ended December 31,
------------------------------- -----------------------
2014 2013 2014 2013
---- ---- ---- ----
(In thousands, except share and per share data)
INTEREST AND DIVIDEND
INCOME
Loan receivable, including
loan fees $100,103 $92,402 $390,440 $359,959
Investment securities-
taxable 4,848 8,426 24,237 43,412
Investment securities-
nontaxable - - - 995
Federal Home Loan Bank stock 595 439 1,974 1,480
Deposits with banks 497 354 1,996 1,150
Total interest and dividend
income 106,043 101,621 418,647 406,996
------- ------- ------- -------
INTEREST EXPENSE
Time deposits of $100,000 or
more 6,946 6,745 27,465 27,211
Other deposits 4,842 3,934 18,304 13,178
Securities sold under
agreements to repurchase 4,954 7,914 24,685 37,692
Advances from Federal Home
Loan Bank 94 153 943 528
Long-term debt 1,455 913 4,467 3,691
Short-term borrowings 1 - 2 -
Total interest expense 18,292 19,659 75,866 82,300
------ ------ ------ ------
Net interest income before
reversal for credit losses 87,751 81,962 342,781 324,696
Provision/(reversal) for
credit losses (2,000) - (10,800) (3,000)
Net interest income after
provision for credit losses 89,751 81,962 353,581 327,696
------ ------ ------- -------
NON-INTEREST INCOME
Securities gains/(losses),
net (79) 205 6,748 27,362
Letters of credit
commissions 1,496 1,673 6,043 6,281
Depository service fees 1,289 1,371 5,288 5,701
Other operating income 5,267 5,096 22,448 20,963
Total non-interest income 7,973 8,345 40,527 60,307
----- ----- ------ ------
NON-INTEREST EXPENSE
Salaries and employee
benefits 20,421 21,084 89,893 88,276
Occupancy expense 4,043 3,880 15,735 14,846
Computer and equipment
expense 2,486 2,280 9,793 9,768
Professional services
expense 6,224 6,090 22,634 24,574
FDIC and State assessments 2,104 1,920 8,796 7,351
Marketing expense 1,404 700 4,126 3,403
Other real estate owned
income (675) (1,121) (1,304) (235)
Operations of affordable
housing investments 1,864 2,301 6,990 7,253
Amortization of core deposit
intangibles 209 436 719 4,533
Cost associated with debt
redemption - 2 3,348 22,557
Other operating expense 3,045 2,747 13,583 11,507
Total non-interest expense 41,125 40,319 174,313 193,833
------ ------ ------- -------
Income before income tax
expense 56,599 49,988 219,795 194,170
Income tax expense 21,021 17,946 81,965 70,435
------ ------ ------ ------
Net income 35,578 32,042 137,830 123,735
Less: net income
attributable to
noncontrolling interest - 140 - 592
--- --- --- ---
Net income attributable to
Cathay General Bancorp 35,578 31,902 137,830 123,143
------ ------ ------- -------
Dividends on preferred stock
and noncash charge from
repayment - - - (9,685)
--- --- --- ------
Net income attributable to
common stockholders $35,578 $31,902 $137,830 $113,458
======= ======= ======== ========
Net income attributable to
common stockholders per
common share:
Basic $0.45 $0.40 $1.73 $1.44
Diluted $0.44 $0.40 $1.72 $1.43
Cash dividends paid per
common share $0.10 $0.05 $0.29 $0.08
Basic average common shares
outstanding 79,727,948 79,256,279 79,661,571 78,954,898
Diluted average common
shares outstanding 80,163,504 79,713,155 80,106,895 79,137,983
CATHAY GENERAL BANCORP
AVERAGE BALANCES - SELECTED CONSOLIDATED FINANCIAL INFORMATION
(Unaudited)
Three months ended,
-------------------
(In thousands) December 31, 2014 December 31, 2013 September 30, 2014
------------- ----------------- ----------------- ------------------
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) $8,846,861 4.49% $7,945,343 4.61% $8,705,723 4.56%
Taxable
investment
securities 1,292,589 1.49% 1,683,358 1.99% 1,288,207 1.57%
FHLB stock 32,747 7.21% 26,801 6.50% 32,057 6.29%
Deposits with
banks 199,519 0.99% 190,092 0.74% 363,722 0.62%
Total interest-
earning assets $10,371,716 4.06% $9,845,594 4.09% $10,389,709 4.06%
----------- ---------- -----------
Interest-bearing liabilities
Interest-
bearing demand
deposits $763,021 0.17% $667,005 0.16% $736,690 0.18%
Money market
deposits 1,517,485 0.59% 1,323,759 0.61% 1,527,888 0.63%
Savings
deposits 548,258 0.18% 504,411 0.08% 557,578 0.17%
Time deposits 4,252,265 0.84% 4,047,956 0.81% 4,345,065 0.83%
--------- --------- ---------
Total interest-
bearing
deposits $7,081,029 0.66% $6,543,131 0.65% $7,167,221 0.67%
Securities sold
under
agreements to
repurchase 508,696 3.86% 800,000 3.92% 603,804 3.85%
Other borrowed
funds 85,806 0.44% 87,746 0.69% 102,267 0.60%
Long-term debt 119,136 4.85% 164,614 2.20% 119,136 4.85%
------- ---- ------- ---- ------- ----
Total interest-
bearing
liabilities 7,794,667 0.93% 7,595,491 1.03% 7,992,428 0.97%
Non-interest-
bearing demand
deposits 1,646,084 1,448,044 1,549,463
Total deposits
and other
borrowed funds $9,440,751 $9,043,535 $9,541,891
---------- ---------- ----------
Total average
assets $11,136,124 $10,612,221 $11,179,433
Total average
equity $1,593,361 $1,463,034 $1,559,413
---------- ---------- ----------
Year ended,
-----------
(In thousands) December 31, 2014 December 31, 2013
------------- ----------------- -----------------
Interest-
earning assets Average Balance Average Yield/Rate (1) (2) Average Balance Average Yield/Rate (1) (2)
--------------- -------------------------- --------------- --------------------------
Loans (1) $8,532,248 4.58% $7,630,530 4.72%
Taxable
investment
securities 1,417,007 1.71% 1,903,541 2.28%
Tax-exempt
investment
securities
(2) - - 29,076 5.27%
FHLB stock 29,487 6.69% 33,446 4.43%
Deposits with
banks 242,037 0.82% 184,654 0.62%
Total interest-
earning assets $10,220,779 4.10% $9,781,247 4.17%
----------- ----------
Interest-bearing liabilities
Interest-
bearing demand
deposits $721,435 0.17% $634,506 0.16%
Money market
deposits 1,407,053 0.61% 1,215,347 0.58%
Savings
deposits 532,184 0.15% 488,932 0.08%
Time deposits 4,257,736 0.82% 3,993,508 0.80%
--------- ---------
Total interest-
bearing
deposits $6,918,408 0.66% $6,332,293 0.64%
Securities sold
under
agreements to
repurchase 629,315 3.92% 972,329 3.88%
Other borrowed
funds 146,120 0.65% 72,687 0.73%
Long-term debt 119,785 3.73% 169,492 2.18%
------- ---- ------- ----
Total interest-
bearing
liabilities 7,813,628 0.97% 7,546,801 1.09%
Non-interest-
bearing demand
deposits 1,535,461 1,325,781
Total deposits
and other
borrowed funds $9,349,089 $8,872,582
---------- ----------
Total average
assets $10,974,890 $10,506,842
Total average
equity $1,540,564 $1,548,179
---------- ----------
(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%.
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SOURCE Cathay General Bancorp
