Slide 1: Financial Earnings Results Third Quarter 2022
Financial Earnings Results Third Quarter 2022 October 24, 2022
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 3Q 2022
Financial Highlights 3Q 2022 Quarterly results ending Profitability: Return on Assets & Equity Return on Tangible Equity* September 30, 2022 20.00% 20.00% 18.00% 18.00% 19.48% Net Income 15.94% 17.41% • $99.0 million 16.00% 16.00% 14.00% 14.62% 14.00% 14.58% 14.54% 12.12% 12.29% 13.90% 11.61% 12.00%
Slide 4: Summary Balance Sheets
Summary Balance Sheets $ in millions, except per share data 9.30.22 6.30.22 QoQ Change Cash equivalents & ST investments $ 1,263 $ 1,154 $ 109 AFS debt securities 1,414 1,235 180 Gross loans, net of discounts $ 18,100 $ 17,782 $ 318 Allowance for credit losses (149) (149) (0) Net Loans $ 17,951 $ 17
Slide 5: Loan Composition
Loan Composition Average Loan Growth – QoQ Annualized $ in billions Construction $17.9 +20.3% $16.9 +14.7% $17.5 +9.7% Total Loan Portfolio 3% 18.000000 $15.8 +8.3% $16.1 $0.6 $0.6 30.0% Residential $0.6 • $18.1 billion* $0.6 $3.2 16.000000 $0.7 20.0% Mortgage* $3.2 $3.0 30% 14.000000 $2.9 $2.9 10.0
Slide 6: Commercial Real Estate Portfolio
Commercial Real Estate Portfolio Total CRE Geographic Distribution Total CRE $8.7 billion 48% of total loans Residential 15% NY 34% Construction 3% Total CRE $8.7 Billion Residential CA Retail 11% 48% Mortgage* 30% TX 5% Total Loans Total CRE WA 2% $18.1 Billion 48% IL 3% Office 8% Other 8% C&I Ware
Slide 7: Commercial Real Estate Portfolio: LTV Distribution
Commercial Real Estate Portfolio LTV Distribution of Total CRE $8.7 Billion LTV & Size by Property Type • $1.66 mil avg. outstanding size Total CRE • weighted avg. LTV 51% Total CRE Weighted $ in millions Loan Portfolio Avg. LTV Residental $ 2,659 55% Retail $ 1,947 51% 40% to 50% Office $ 1,433 49%
Slide 8: Selected CRE and Construction Loan Portfolios
Selected CRE and Construction Loan Portfolios Residential CRE Portfolio Retail CRE Portfolio Construction Portfolio % based on $2.66 billion loans outstanding % based on $1.95 billion loans outstanding % based on $573 million loans outstanding 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 0% 5% 10% 15
Slide 9: Residential Mortgage Portfolio
Residential Mortgage Portfolio Geographic Distribution of SFR LTV Distribution Residential Mortgage • $409,887 avg. outstanding size • weighted avg. LTV 55% NY 56% to 60% 33% 16% 51% to 55% 10% $5.5 Billion Residential CA Mortgage* Over 60% 54% Under 50% 41% 33% WA 5% TX 3% NJ 2% Other 3% * Resident
Slide 10: 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 $137 $136 140 $132 $23.8 $22.2 140 $132 1.50% $29.7 $26.7 120 120 $26.4 100 100 $68.6 $70.6 $63.9 1.00% 80 $61.1 $61.0 80 60 0.83% 0.83% 0.8
Slide 11: Asset Quality Metrics
Asset Quality Metrics Reserves and Net Charge-Offs Classified Loans Ratio 800 $ in millions 8.00% 1.00% 0.90% 0.83% 0.83% 0.84% 0.84% 0.82% 700 $266 7.00% 0.80% 600 $253 6.00% 0.70% 500 $219 5.00% $240 0.60% $244 400 $499 4.00% 0.50% $444 300 $389 3.00% 0.40% 200 $295 $305 2.00% 0.30% 0.18% 0.20% 10
Slide 12: Deposit Mix
Deposit Mix Total Deposits Average Deposit Growth – QoQ Annualized • $18.6 billion* $ in billions as of 9.30.22 +6% $18.2 +2% $18.3 +9% $17.3 +15% $17.9 19 $17.0 20% MMA MMA 17 $3.5 $3.6 $3.7 24% 26% $3.0 $3.1 10% 15 $4.8 13 $4.2 $4.4 $5.3 $5.2 0% IB Checking & IB Checking & 11 Savings Savings Time
Slide 13: Summary Income Statements
Summary Income Statements $ in millions, except per share data 9.30.22 6.30.22 $ Change % Change Net Interest Income $ 197.5 $ 175.2 $ 22.4 12.8% Noninterest income 13.5 15.6 (2.0) (13.1)% Net (losses) / Gains from equity securities (3.7) (1.0) (2.7) 283.5% Total Noninterest Income 9.9 14.6 (4.7) (3
Slide 14: 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 6.00% 5.35% 80 2.50% 70 69 4.68% 4.12% 4.14% 2.18% 2.00% 4.04% 3.98% 60 4.00% 52 44 50 3.94% 1.50% 37 37 34 40 3.25% 3.25% 3.29% 33 1.90% 28 28 1.00% 2.00% 30 2
Slide 15: Non-interest Income
Non-interest Income Non-Interest Income* $17.6 18 $ in millions 16 $1.5 $15.6 $1.9 $14.2 14 $1.6 $13.5 $12.2 $1.7 $1.6 $4.0 $1.7 $1.5 12 $1.4 $1.6 10 $1.8 $4.0 $4.4 8 $4.2 $3.6 6 $10.2 4 $8.4 $6.6 $6.0 2 $5.4 - 3Q21 4Q21 1Q22 2Q22 3Q22 other operating income wealth management fees letter of credit c
Slide 16: Operating Expense & Efficiency
Operating Expense & Efficiency Core Noninterest Expense* Core Noninterest Expense* & Efficiency Ratio* $ in millions $ in millions $66.6 70 $63.1 $66.6 $63.1 70 40.00% $61.1 $7.1 $59.2 $61.1 $60.2 $59.2 $60.2 60 38.00% $7.1 60 36.00% $6.5 $4.7 $2.2 $5.9 50 36.0% $2.0 34.00% $1.9 $1.8 34.9% 35.1% $1.
Slide 17: 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 14.00% 13.59% rules. 12.06% 12.06% • Book Value Per Common Share is 12.00% 10.50% 10.02% 10.00% 8.50% $32.96 as of 9.
Slide 18: Management Guidance Full Year 2022
Management Guidance Full Year 2022 Full Year Prior Full Year 2022 Guidance Outlook 2021 Actual Loans, end of period Estimated growth rate Estimated growth rate $16.3 billion excluding PPP 11% to 12.5% 10% to 12% +4.5% YoY Deposits Estimated growth rate Estimated growth rate $18.1 billion 8% to 9.5%
Slide 19: Appendix
Appendix hs
Slide 20: Appendix: GAAP to Non-GAAP Reconciliation
Appendix: GAAP to Non-GAAP Reconciliation Selected Consolidation Financial Information (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 financial measures. T
Slide 21: Cathay General Bancorp
(= Cathay General Bancorp