Cathay General Bancorp · NASDAQ:CATY
Cathay General Bancorp — Q4 2022 Earnings Presentation
22 slides from Cathay General Bancorp's earnings presentation, Jan 25, 2023
Slide 1: Financial Earnings Results
Financial Earnings Results Fourth Quarter and Full Year 2022 January 25, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements about Cathay General Bancorp and its subsidiaries (collectively referred to herein as the “Company,” “we,” “us,” or “our”) within the meaning of the applicable provisions of the Private Securities Litigation Reform Act
Slide 3: Financial Highlights 4Q 2022
Financial Highlights 4Q 2022 Quarterly results ending Profitability: Return on Assets & Equity Return on Tangible Equity* December 31, 2022 20.00% 20.00% 18.00% 18.00% 19.48% Net Income 18.82% 15.94% 15.73% 17.41% • $97.6 million 16.00% 16.00% 14.00% 14.62% 14.00% 14.58% 14.54% 12.00% 12.12% 12.29%
Slide 4: Summary Highlights: 4Q and Full Year 2022 Results
Summary Highlights: 4Q and Full Year 2022 Results $ in millions, Change Change Full Year Change except per share data 4Q 22 4Q22 v. 3Q22 4Q22 v. 4Q21 2022 YoY Earnings Net Income $ 97.6 (1)% 30% $ 360.6 21% Basic EPS $ 1.33 (1)% 36% $ 4.85 27% Diluted EPS $ 1.33 0% 36% $ 4.83 27% Total Revenue $ 213
Slide 5: Summary Balance Sheets
Summary Balance Sheets $ in millions, except per share data 12.31.22 9.30.22 QoQ Change Cash equivalents & ST investments $ 1,154 $ 1,263 $ (109) AFS debt securities 1,473 1,414 59 Gross loans, net of discounts $ 18,247 $ 18,100 $ 148 Allowance for credit losses (146) (149) 2 Net Loans $ 18,101 $ 17
Slide 6: Loan Composition
Loan Composition Average Loan Growth – QoQ Annualized $ in billions Construction $18.1 $17.5 $17.9 +4.8% Total Loan Portfolio 3% +20.3% $16.9 +14.7% +9.7% $0.6 30.0% $16.1 $0.6 18.000000 Residential $0.6 • $18.3 billion* $0.6 20.0% Mortgage* 16.000000 $0.6 $3.2 $3.3 $3.0 $3.2 31% $2.9 10.0% 14.00000
Slide 7: Commercial Real Estate Portfolio
Commercial Real Estate Portfolio Total CRE Geographic Distribution Total CRE $8.8 billion 48% of total loans Residential 15% NY 34% Construction 3% Total CRE $8.8 Billion Residential CA Retail 11% 48% Mortgage* 30% TX 4% Total Loans Total CRE WA 2% $18.3 Billion 48% IL 3% Office 8% Other 9% C&I Ware
Slide 8: Commercial Real Estate Portfolio
Commercial Real Estate Portfolio LTV Distribution of Total CRE $8.8 Billion LTV & Size by Property Type • $1.67 mil avg. outstanding size Total CRE • weighted avg. LTV 51% Total CRE Weighted $ in millions Loan Portfolio Avg. LTV Residental $ 2,729 54% Retail $ 1,964 50% 40% to 50% Office $ 1,422 49%
Slide 9: Selected CRE and Construction Loan Portfolios
Selected CRE and Construction Loan Portfolios Residential CRE Portfolio Retail CRE Portfolio Construction Portfolio % based on $2.73 billion loans outstanding % based on $1.96 billion loans outstanding % based on $559 million loans outstanding 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 0% 5% 10% 15
Slide 10: Residential Mortgage Portfolio
Residential Mortgage Portfolio Geographic Distribution of SFR LTV Distribution Residential Mortgage • $412,319 avg. outstanding size • weighted avg. LTV 55% NY 56% to 60% 34% 16% 51% to 55% 10% $5.6 Billion Residential CA Mortgage* Over 60% 53% Under 50% 41% 33% WA 5% TX 3% NJ 2% Other 3% * Resident
Slide 11: Allowance for Loan and Lease Losses (ALLL)
Allowance for Loan and Lease Losses (ALLL) ALLL Ratio ALLL Composition $ in millions $ in millions 180 180 2.00% Millions $149 $149 160 160 $149 $149 $146 $146 $146 $146 $137 140 $136 140 $23.8 $22.2 $18.3 1.50% $29.7 120 $26.7 120 100 $68.4 100 $68.6 $70.1 $63.9 1.00% 80 80 $61.1 60 0.83% 0.84% 0.8
Slide 12: Asset Quality Metrics
Asset Quality Metrics Reserves and Net Charge-Offs Classified Loans Ratio $ in millions 1.00% 800 8.00% 0.90% 0.83% 0.84% 0.84% 0.82% 0.80% 700 $266 7.00% 0.80% 600 6.00% 0.70% 500 $219 $256 5.00% 0.60% $244 $240 400 $499 4.00% 0.50% $389 0.40% 300 3.00% 200 $295 $305 $321 2.00% 0.30% 0.20% 0.06% 10
Slide 13: Deposit Mix
Deposit Mix Total Deposits Average Deposit Growth – QoQ Annualized • $18.5 billion* $ in billions as of 12.31.22 MMA $18.2 $18.3 +9% $18.7 19 $17.3 +15% $17.9 +6% +2% 21% 20% 17 $3.5 $3.6 $3.7 $3.6 15 $3.1 10% IB Checking & 13 $4.4 $4.4 $4.8 $5.3 $5.2 0% Savings 11 -10% Time 19% 9 $4.3 $4.2 $4.3 $4.
Slide 14: Summary Income Statements
Summary Income Statements $ in millions, except per share data 12.31.22 9.30.22 $ Change % Change Net Interest Income $ 201.8 $ 197.5 $ 4.3 2.2% Noninterest income 13.1 13.5 (0.5) (3.6)% Net (losses) / Gains from equity securities (1.0) (3.7) 2.7 (73.6)% Total Noninterest Income 12.1 9.9 2.2 22.4% N
Slide 15: Loan Yields, Deposit Costs and Net Interest Margins
Loan Yields, Deposit Costs and Net Interest Margins Average Loan Yield vs Prime Rate and 1M SOFR Average Cost of Deposits vs Fed Funds Rate 6.83% 180 4.00% 3.65% 159 160 6.00% 5.35% 5.33% 3.50% 140 4.68% 122 3.00% 4.04% 3.98% 4.14% 120 2.18% 2.50% 4.00% 3.37% 100 3.94% 2.00% 80 69 3.25% 3.29% 1.90%
Slide 16: Non-Interest Income
Non-Interest Income Non-Interest Income* $ in millions 18 $17.6 16 $1.5 $15.6 $1.9 $14.2 14 $1.6 $13.5 $13.1 $1.7 $1.6 $4.0 $1.7 $1.5 $1.5 12 $1.6 $1.6 10 $4.0 $4.4 8 $4.2 $3.9 6 $10.2 4 $8.4 $6.6 $6.0 $6.1 2 - 4Q21 1Q22 2Q22 3Q22 4Q22 other operating income wealth management fees letter of credit c
Slide 17: Operating Expense & Efficiency
Operating Expense & Efficiency Core Noninterest Expense* Core Noninterest Expense* & Efficiency Ratio* $ in millions $ in millions $66.6 70 $65.4 $66.6 $63.1 70 $63.1 $65.4 40.00% $61.1 $7.1 $61.1 $60.2 $60.2 38.00% $7.9 60 $7.1 60 36.00% $6.5 $4.7 $2.2 $2.0 50 $2.0 34.00% $1.9 $1.8 34.9% 35.1% $7.7
Slide 18: Strong Capital Ratios
Strong Capital Ratios • Capital Ratio well above regulatory standards that continues to place Cathay in the “well capitalized” category, 16.00% calculated under the Basel III capital 13.71% rules. 12.19% 12.19% 14.00% • Book Value Per Common Share is 12.00% 10.50% 10.08% 10.00% 8.50% $34.01 as of 12
Slide 19: Management Guidance Full Year 2023
Management Guidance Full Year 2023 Full Year 2023 Guidance Full Year Compared with 2022 Actual 2022 Actual Loans, end of period • Estimated growth rate 3% to 5% $18.3 billion +11.7% YoY Deposits • Estimated growth rate 3% to 5% $18.5 billion +2.5% YoY Core Noninterest Expense • Estimated growth rate
Slide 20: Appendix
Appendix hs
Slide 21: Appendix: GAAP to Non-GAAP Reconciliation
Appendix: GAAP to Non-GAAP Reconciliation Selected Consolidation Financial Information ($ in thousands) (unaudited) We use certain non-GAAP financial measures to provide supplemental information regarding our performance. Tangible equity and tangible equity to tangible assets ratio are non-GAAP fina
Slide 22: Cathay General Bancorp
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