CATY Cathay General Bancorp

LOS ANGELES, July 26 /PRNewswire-FirstCall/ -- Cathay General Bancorp (the "Company") (NASDAQ:CATY), the holding company for Cathay Bank (the "Bank"), today announced results for the second quarter of 2007. STRONG FINANCIAL PERFORMANCE Second Quarter Second Quarter 2007 2006 Net income $30.6 million $29.1 million Basic earnings per share $0.60 $0.57 Diluted earnings per share $0.60 $0.56 Return on average assets 1.40% 1.59% Return on average stockholders' equity 13.13% 13.70% Efficiency ratio 39.06% 37.85% HIGHLIGHTS -- Second quarter earnings increased $1.5 million, or 5.3%, compared to the same quarter a year ago. -- Second quarter diluted earnings per share reached $0.60, increasing 7.1%, compared to the same quarter a year ago. -- Return on average assets was 1.40% for the quarter ended June 30, 2007, compared to 1.45% for the quarter ended March 31, 2007 and compared to 1.59% for the same quarter a year ago. -- Return on average stockholders' equity was 13.13% for the quarter ended June 30, 2007, compared to 12.87% for the quarter ended March 31, 2007, and compared to 13.70% for the same quarter a year ago. -- Gross loans increased by $278.1 million, or 4.7%, from $5.9 billion at March 31, 2007 to $6.2 billion at June 30, 2007. "We are pleased to report solid earnings during the second quarter in the continued challenging interest rate environment. We generated strong loan growth in all major categories during the second quarter," commented Dunson Cheng, Chairman of the Board, Chief Executive Officer, and President of the Company. "Our Hong Kong branch opened for business on May 25, 2007. During July, we opened our new Dallas, Texas and Ontario, California branches," said Peter Wu, Executive Vice Chairman and Chief Operating Officer. "The Company repurchased 2.1 million shares of its common stock during the first half of the year continuing the Company's commitment to effective capital management and stockholder value. Based on current trends, we are still optimistic that 2007 should be another record year for Cathay General Bancorp," concluded Dunson Cheng. INCOME STATEMENT REVIEW The comparability of financial information is affected by our acquisitions. Operating results included the operations of acquired entities from the date of acquisition. Net interest income before provision for loan losses Net interest income before provision for loan losses increased $5.4 million, or 7.7%, to $76.5 million during the second quarter of 2007 from $71.1 million during the same quarter a year ago. The increase was due primarily to the strong growth in loans and securities. The net interest margin, on a fully taxable-equivalent basis, was 3.78% for the second quarter of 2007. The net interest margin decreased 5 basis points from 3.83% in the first quarter of 2007 and decreased 49 basis points from 4.27% in the second quarter of 2006. The decrease in the net interest margin was primarily a result of the repricing of time deposits to reflect higher market interest rates, and increased reliance on more expensive wholesale deposits and borrowings. For the second quarter of 2007, the yield on average interest-earning assets was 7.39% on a fully taxable-equivalent basis, and the cost of funds on average interest-bearing liabilities equaled 4.22%. In comparison, for the second quarter of 2006, the yield on average interest-earning assets was 7.26% and cost of funds on average interest-bearing liabilities equaled 3.60%. 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, decreased primarily due to the reasons discussed above. Provision for loan losses The provision for loan losses was $2.1 million for the second quarter of 2007 compared to $1.5 million provision for loan losses for the second quarter of 2006 and a $1.0 million provision for loan losses for the first quarter of 2007. The provision for loan losses was based on the review of the adequacy of the allowance for loan losses at June 30, 2007. The provision for loan losses represents the charge or credit against 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 loan losses inherent in the Company's loan portfolio. During the second quarter of 2007, the Company charged off $2.6 million in loans to a commercial borrower who ceased operations. The following table summarizes the charge-offs and recoveries for the periods as indicated: For the three months For the six months ended June 30, ended June 30, (Dollars in thousands) 2007 2006 2007 2006 Charge-offs: Commercial loans $2,712 $540 $5,742 $805 Construction loans - - 190 - Real estate loans 57 - 118 - Installment and other loans 1 4 1 4 Total charge-offs 2,770 544 6,051 809 Recoveries: Commercial loans 302 410 2,773 644 Construction loans 190 - 190 - Real estate loans 202 - 202 3 Installment and other loans 19 12 25 16 Total recoveries 713 422 3,190 663 Net Charge-offs $2,057 $122 $2,861 $146 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 $6.2 million for the second quarter of 2007, an increase of $411,000, or 7.1%, compared to the non-interest income of $5.8 million for the second quarter of 2006. Letter of credit commissions decreased $102,000, or 6.6%, to $1.4 million in the second quarter of 2007 from $1.5 million in the second quarter of 2006 primarily due to decrease in standby letter of credit commissions. Depository service fees decreased $201,000, or 16.2%, from $1.2 million in the second quarter of 2006 to $1.0 million in the second quarter of 2007 due primarily to the decreases in account analysis charges. The above decreases were offset by the increase of $716,000, or 24.1%, in other operating income, due primarily to a $594,000 increase in venture capital investment income. Non-interest expense Non-interest expense increased $3.2 million, or 11.1%, to $32.3 million in the second quarter of 2007 compared to $29.1 million in the same quarter a year ago. The efficiency ratio was 39.06% for the second quarter of 2007 compared to 37.85% in the year ago quarter and 38.44% for the first quarter of 2007. The increase of non-interest expense in the second quarter of 2007 compared to the same period a year ago was primarily due to the following: -- Salaries and employee benefits increased $815,000, or 5.1%, due primarily to the Company's acquisitions and the hiring of additional staff. -- Occupancy expenses increased $380,000, or 13.9%, primarily due to the additions of new branches through acquisitions and new branch openings. -- Computer and equipment expenses increased $495,000, or 24.1%, primarily due to a $421,000 increase in software license fees under new data processing contracts. -- Professional services expenses increased $965,000, or 61.2%, due primarily to increases of $321,000 increase in legal expenses related to loan collection efforts and a $330,000 increase in consulting expenses due in part to the opening of our new Hong Kong branch this year. -- Expenses from operation of affordable housing investments increased $145,000, or 11.2%, to $1.4 million compared to $1.3 million in the same quarter a year ago as a result of additional investments in affordable housing projects. -- Amortization of core deposit premiums increased $191,000, or 12.1%, due to the acquisitions of New Asia Bank and United Heritage Bank. -- Other operating expenses increased $619,000, or 28.3%, primarily due to increases in insurance expenses of $149,000, recruiting expenses of $125,000, communication expenses of $122,000, and other miscellaneous expenses. -- Partially offsetting the above increases, OREO expenses decreased $394,000 primarily due to a $283,000 writedown of OREO in 2006. Income taxes The effective tax rate was 36.7% for the second quarter of 2007, compared to 37.2% for the same quarter a year ago and 36.4% for the full year 2006. BALANCE SHEET REVIEW Total assets increased by $874.5 million, or 10.9%, to $8.9 billion at June 30, 2007, from year-end 2006 assets of $8.0 billion. The increase in total assets was represented primarily by increases in loans, securities purchased under agreements to resell, and investment securities. Securities purchased under agreements to resell increased $204.0 million and long-term certificates of deposit increased $50.0 million during the first six months of 2007 due to attractive rates available on these investments. Securities available-for-sale increased by $188.9 million during the first six months of 2007 primarily due to purchases of callable agency securities which provided collateral for repurchase agreements. The growth of gross loans to $6.2 billion as of June 30, 2007, from $5.7 billion as of December 31, 2006, represents an increase of $427.3 million, or 7.4%, of which $38.6 million resulted from the acquisition of United Heritage Bank on March 30, 2007. The changes in the loan composition from December 31, 2006, are presented below: Type of Loans: June 30, 2007 December 31, 2006 % Change (Dollars in thousands) Commercial $1,307,937 $1,243,756 5 Residential mortgage 500,977 455,949 10 Commercial mortgage 3,491,591 3,226,658 8 Equity lines 107,226 118,473 (9) Real estate construction 749,229 685,206 9 Installment 13,497 13,257 2 Other 4,377 4,247 3 Gross loans and leases $6,174,834 $5,747,546 7 Allowance for loan losses (65,360) (64,689) 1 Unamortized deferred loan fees (11,325) (11,984) (5) Total loans and leases, net $6,098,149 $5,670,873 8 Total deposits increased $166.7 million, or 2.9%, to $5.8 billion at June 30, 2007, from $5.7 million at December 31, 2006, of which $54.2 million resulted from the acquisition of United Heritage Bank at March 31, 2007. The changes in the deposit composition from December 31, 2006, are presented below: Deposits June 30, 2007 December 31, 2006 % Change (Dollars in thousands) Non-interest-bearing demand $795,836 $781,492 2 NOW 235,769 239,589 (2) Money market 671,671 657,689 2 Savings 349,442 358,827 (3) Time deposits under $100,000 1,095,452 1,007,637 9 Time deposits of $100,000 or more 2,693,869 2,630,072 2 Total deposits $5,842,039 $5,675,306 3 At June 30, 2007, brokered deposits increased $125.3 million to $373.0 million from $247.7 million at December 31, 2006. Securities sold under agreement to repurchase increased $480.1 million from $400.0 million at December 31, 2006, to $880.1 million at June 30, 2007. Advances from the Federal Home Loan Bank increased $185.0 million to $899.7 million at June 30, 2007, compared to $714.7 million at December 31, 2006. ASSET QUALITY REVIEW Non-performing assets to gross loans and other real estate owned was 0.61% at June 30, 2007, compared to 0.62% at December 31, 2006. Total non-performing assets increased $2.0 million to $37.6 million at June 30, 2007, compared with $35.6 million at December 31, 2006, primarily due to a $12.6 million increase in non-accrual loans offset by a $4.9 million decrease in other real estate owned and by a $5.7 million decrease in accruing loans past due 90 days or more. At June 30, 2007, total nonaccrual loans included $18.2 million in loans secured by real estate collateral in Texas comprised of a $9.7 million apartment loan, a $6.8 million shopping center construction loan, and a $1.7 million office building loan. The allowance for loan losses amounted to $65.4 million at June 30, 2007, and represented the amount that the Company believes to be sufficient to absorb loan losses inherent in the Company's loan portfolio. The allowance for loan losses represented 1.06% of period-end gross loans and 176% of non-performing loans at June 30, 2007. The comparable ratios were 1.13% of gross loans and 213% of non-performing loans at December 31, 2006. Results of the changes to the Company's non-performing assets and troubled debt restructurings are highlighted below: (Dollars in thousands) June 30, 2007 December 31, 2006 % Change Non-performing assets Accruing loans past due 90 days or more $2,251 $8,008 (72) Non-accrual loans: Construction 12,037 5,786 108 Commercial real estate 16,326 1,276 1,179 Commercial 5,173 14,425 (64) Real Estate Mortgage 1,371 835 64 Other 18 - 100 Total non-accrual loans: 34,925 22,322 56 Total non-performing loans 37,176 30,330 23 Other real estate owned 374 5,259 (93) Total non-performing assets $37,550 $35,589 6 Troubled debt restructurings $938 $955 (2) CAPITAL ADEQUACY REVIEW At June 30, 2007, the Tier 1 risk-based capital ratio of 9.21%, total risk-based capital ratio of 10.69%, and Tier 1 leverage capital ratio of 8.46%, continue to place the Company in the "well capitalized" category, which is defined as institutions with a Tier 1 risk-based capital ratio equal to or greater than six percent, a total risk-based capital ratio equal to or greater than ten percent, and a Tier 1 leverage capital ratio equal to or greater than five percent. At December 31, 2006, the Company's Tier 1 risk-based capital ratio was 9.40%, the total risk-based capital ratio was 11.00%, and Tier 1 leverage capital ratio was 8.98%. During the second quarter of 2007, the Company repurchased 1,226,150 shares of its common stock for $41.6 million, or $33.90 average cost per share. During the first half of 2007, the Company repurchased 2,104,053 shares of its common stock for $71.5 million, or $33.99 average cost per share. At June 30, 2007, 347,650 shares remain under the Company's May 8, 2007, repurchase program. The Company issued $20.6 million of junior subordinated debt on May 31, 2007 at a rate of LIBOR plus 140 basis points. The junior subordinated debt qualifies as Tier 1 capital for regulatory reporting purposes. YEAR-TO-DATE REVIEW Net income was $60.5 million, or $1.17 per diluted share for the six months ended June 30, 2007, an increase of $4.1 million, or 7.4%, in net income over the $56.4 million, or $1.10 per diluted share for the same period a year ago due primarily to increases in net interest income. The net interest margin for the six months ended June 30, 2007, decreased 50 basis points to 3.80% compared to 4.30% for the same period a year ago. Return on average stockholders' equity was 13.00% and return on average assets was 1.42% for the six months ended June 30, 2007, compared to a return on average stockholders' equity of 13.87% and a return on average assets of 1.63% for the same period of 2006. The efficiency ratio for the six months ended June 30, 2007 was 38.76% compared to 37.00% for the same period a year ago. 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, nine branches in New York State, one in Massachusetts, two in Texas, three in Washington State, three in Chicago, Illinois, one in New Jersey, one in Hong Kong and representative offices in Taipei and Shanghai. Cathay Bank's website is found at http://www.cathaybank.com/. 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 "believes," "expects," "anticipates," "intends," "plans," "estimates," "may," "will," "should," "could," "predicts," "potential," "continue," or the negative of such terms and other comparable terminology or similar expressions. Forward-looking statements are not guarantees. They involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of Cathay General Bancorp to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Such risks and uncertainties and other factors include, but are not limited to, adverse developments or conditions related to or arising from: expansion into new market areas; acquisitions of other banks, if any; fluctuations in interest rates; demographic changes; earthquake or other natural disasters; competitive pressures; deterioration in asset or credit quality; changes in the availability of capital; legislative and regulatory developments; changes in business strategy; and general economic or business conditions in California and other regions where Cathay Bank has operations. These and other factors are further described in Cathay General Bancorp's Annual Report on Form 10-K for the year ended December 31, 2006, its reports and registration statements filed with the Securities and Exchange Commission ("SEC") and other filings it makes in the future with the SEC from time to time. Cathay General Bancorp has no intention and undertakes no obligation to update any forward-looking statements or to publicly announce the results of any revision of any forward-looking statement to reflect future developments or events. Cathay General Bancorp's filings with the SEC are available to the public from commercial document retrieval services and at the website maintained by the SEC at http://www.sec.gov/, or by request directed to Cathay General Bancorp, 777 N. Broadway, Los Angeles, CA 90012, Attention: Investor Relations (213) 625-4749. CATHAY GENERAL BANCORP CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, Three months ended Six months ended except per share June 30, June 30, data) 2007 2006 % Change 2007 2006 % Change FINANCIAL PERFORMANCE Net interest income before provision for loan losses $76,497 $71,050 8 $149,249 $136,191 10 Provision for loan losses 2,100 1,500 40 3,100 3,000 3 Net interest income after provision for loan losses 74,397 69,550 7 146,149 133,191 10 Non-interest income 6,162 5,751 7 12,046 10,826 11 Non-interest expense 32,285 29,069 11 62,514 54,395 15 Income before income tax expense 48,274 46,232 4 95,681 89,622 7 Income tax expense 17,693 17,180 3 35,134 33,234 6 Net income $30,581 $29,052 5 $60,547 $56,388 7 Net income per common share: Basic $0.60 $0.57 5 $1.18 $1.11 6 Diluted $0.60 $0.56 7 $1.17 $1.10 6 Cash dividends paid per common share $0.105 $0.090 17 $0.195 $0.180 8 SELECTED RATIOS Return on average assets 1.40% 1.59% (12) 1.42% 1.63% (13) Return on average stockholders' equity 13.13% 13.70% (4) 13.00% 13.87% (6) Efficiency ratio 39.06% 37.85% 3 38.76% 37.00% 5 Dividend payout ratio 17.56% 15.94% 10 16.59% 16.23% 2 YIELD ANALYSIS (Fully taxable equivalent) Total interest- earning assets 7.39% 7.26% 2 7.41% 7.11% 4 Total interest- bearing liabilities 4.22% 3.60% 17 4.24% 3.40% 25 Net interest spread 3.17% 3.66% (13) 3.17% 3.71% (15) Net interest margin 3.78% 4.27% (11) 3.80% 4.30% (12) CAPITAL RATIOS June 30, 2007 June 30, 2006 December 31, 2006 Tier 1 risk-based capital ratio 9.21% 9.45% 9.40% Total risk-based capital ratio 10.69% 10.45% 11.00% Tier 1 leverage capital ratio 8.46% 8.85% 8.98% CATHAY GENERAL BANCORP CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) June 30, 2007 December 31, 2006 % change (In thousands, except share and per share data) Assets Cash and due from banks $112,814 $114,798 (2) Federal funds sold - 18,000 (100) Cash and cash equivalents 112,814 132,798 (15) Short-term investments 25,027 16,379 53 Securities purchased under agreements to resell 204,000 - 100 Long-term certificates of deposit 50,000 - 100 Securities available-for- sale (amortized cost of $1,738,456 at June 30, 2007 and $1,543,667 at December 31, 2006) 1,711,128 1,522,223 12 Trading securities 10,294 5,309 94 Loans 6,174,834 5,747,546 7 Less: Allowance for loan losses (65,360) (64,689) 1 Unamortized deferred loan fees, net (11,325) (11,984) (5) Loans, net 6,098,149 5,670,873 8 Federal Home Loan Bank stock 50,298 34,348 46 Other real estate owned, net 374 5,259 (93) Affordable housing investments, net 85,316 87,289 (2) Premises and equipment, net 73,558 72,934 1 Customers' liability on acceptances 25,604 27,040 (5) Accrued interest receivable 51,998 39,267 32 Goodwill 320,653 316,752 1 Other intangible assets, net 39,744 42,987 (8) Other asset 42,071 53,050 (21) Total assets $8,901,028 $8,026,508 11 Liabilities and Stockholders' Equity Deposits Non-interest-bearing demand deposits $795,836 $781,492 2 Interest-bearing deposits: NOW deposits 235,769 239,589 (2) Money market deposits 671,671 657,689 2 Savings deposits 349,442 358,827 (3) Time deposits under $100,000 1,095,452 1,007,637 9 Time deposits of $100,000 or more 2,693,869 2,630,072 2 Total deposits 5,842,039 5,675,306 3 Federal funds purchased 38,000 50,000 (24) Securities sold under agreement to repurchase 880,102 400,000 120 Advances from the Federal Home Loan Bank 899,680 714,680 26 Other borrowings 19,000 10,000 90 Other borrowings from affordable housing investments 19,746 19,981 (1) Long-term debt 171,136 104,125 64 Acceptances outstanding 25,604 27,040 (5) Minority interest in consolidated subsidiaries 8,500 8,500 - Other liabilities 80,279 73,802 9 Total liabilities 7,984,086 7,083,434 13 Commitments and contingencies - - - Total stockholders' equity 916,942 943,074 (3) Total liabilities and stockholders' equity $8,901,028 $8,026,508 11 Book value per share $18.35 $18.16 1 Number of common stock shares outstanding 49,963,215 51,930,955 (4) CATHAY GENERAL BANCORP CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited) Three months ended Six months ended June 30, June 30, 2007 2006 2007 2006 (In thousands, except share and per share data) INTEREST AND DIVIDEND INCOME Loan receivable, including loan fees $118,737 $104,158 $232,916 $194,244 Investment securities- taxable 24,439 15,381 46,254 28,527 Investment securities- nontaxable 583 707 1,182 1,429 Federal Home Loan Bank stock 541 369 1,050 717 Agency preferred stock 174 295 338 504 Federal funds sold and securities purchased under agreements to resell 3,965 102 7,767 130 Deposits with banks 1,254 87 2,040 154 Total interest and dividend income 149,693 121,099 291,547 225,705 INTEREST EXPENSE Time deposits of $100,000 or more 31,900 24,390 63,052 45,828 Other deposits 18,684 12,714 36,671 22,607 Securities sold under agreements to repurchase 7,544 4,013 13,261 6,526 Advances from Federal Home Loan Bank 11,677 6,894 23,458 10,693 Long-term debt 2,899 1,110 4,875 2,151 Short-term borrowings 492 928 981 1,709 Total interest expense 73,196 50,049 142,298 89,514 Net interest income before provision for loan losses 76,497 71,050 149,249 136,191 Provision for loan losses 2,100 1,500 3,100 3,000 Net interest income after provision for loan losses 74,397 69,550 146,149 133,191 NON-INTEREST INCOME Securities gains, net - 2 191 29 Letters of credit commissions 1,435 1,537 2,727 2,606 Depository service fees 1,037 1,238 2,383 2,493 Other operating income 3,690 2,974 6,745 5,698 Total non-interest income 6,162 5,751 12,046 10,826 NON-INTEREST EXPENSE Salaries and employee benefits 16,886 16,071 33,863 30,111 Occupancy expense 3,107 2,727 5,876 4,807 Computer and equipment expense 2,553 2,058 4,777 3,668 Professional services expense 2,543 1,578 4,271 3,219 FDIC and State assessments 261 254 520 503 Marketing expense 904 911 1,805 1,606 Other real estate owned expense 17 411 261 496 Operations of affordable housing investments 1,444 1,299 2,388 2,598 Amortization of core deposit intangibles 1,767 1,576 3,531 2,977 Other operating expense 2,803 2,184 5,222 4,410 Total non-interest expense 32,285 29,069 62,514 54,395 Income before income tax expense 48,274 46,232 95,681 89,622 Income tax expense 17,693 17,180 35,134 33,234 Net income 30,581 29,052 60,547 56,388 Other comprehensive loss, net of tax (8,093) (4,278) (3,410) (11,117) Total comprehensive income $22,488 $24,774 $57,137 $45,271 Net income per common share: Basic $0.60 $0.57 $1.18 $1.11 Diluted $0.60 $0.56 $1.17 $1.10 Cash dividends paid per common share $0.105 $0.090 $0.195 $0.180 Basic average common shares outstanding 50,558,218 51,390,534 51,118,374 50,811,866 Diluted average common shares outstanding 51,158,029 51,990,604 51,723,487 51,397,526 CATHAY GENERAL BANCORP AVERAGE BALANCES - SELECTED CONSOLIDATED FINANCIAL INFORMATION (Unaudited) For the three months ended, (In thousands) June 30, 2007 June 30, 2006 Average Average Average Yield/ Average Yield/ Interest-earning assets Balance Rate Balance Rate (1)(2) (1)(2) Loans and leases (1) $6,010,958 7.92% $5,285,231 7.90% Taxable investment securities 1,734,645 5.65% 1,289,299 4.79% Tax-exempt investment securities (2) 66,206 6.89% 85,393 7.01% FHLB & FRB stock 50,165 4.33% 30,171 4.91% Federal funds sold and securities purchased under agreements to resell 216,646 7.34% 9,723 4.21% Deposits with banks 68,177 7.38% 17,235 2.02% Total interest-earning assets $8,146,797 7.39% $6,717,052 7.26% Interest-bearing liabilities Interest-bearing demand deposits $233,260 1.29% $245,933 1.25% Money market 675,753 3.09% 577,276 2.65% Savings deposits 353,562 1.01% 405,519 0.92% Time deposits 3,683,089 4.76% 3,258,591 3.89% Total interest-bearing deposits $4,945,664 4.10% $4,487,319 3.32% Federal funds purchased 34,780 5.35% 45,357 4.98% Securities sold under agreements to repurchase 831,625 3.64% 400,000 4.02% Other borrowed funds 982,126 4.78% 593,262 4.91% Long-term debt 157,541 7.38% 53,997 8.25% Total interest-bearing liabilities 6,951,736 4.22% 5,579,935 3.60% Non-interest-bearing demand deposits 784,033 776,203 Total deposits and other borrowed funds $7,735,769 $6,356,138 Total average assets $8,787,525 $7,308,866 Total average stockholders' equity $934,313 $850,843 For the six months ended, (In thousands) June 30, 2007 June 30, 2006 Average Average Average Yield/ Average Yield/ Interest-earning assets Balance Rate Balance Rate (1)(2) (1)(2) Loans and leases $5,900,074 7.96% $5,063,174 7.74% Taxable investment securities 1,657,107 5.63% 1,225,901 4.69% Tax-exempt investment securities (2) 70,851 6.50% 86,070 6.78% FHLB & FRB stock 47,575 4.45% 29,964 4.83% Federal funds sold and securities purchased under agreements to resell 217,151 7.21% 6,192 4.23% Deposits with banks 58,056 7.09% 18,281 1.70% Total interest-earning assets $7,950,814 7.41% $6,429,582 7.11% Interest-bearing liabilities Interest-bearing demand deposits $232,960 1.28% $244,207 1.10% Money market deposits 671,130 3.09% 576,522 2.48% Savings deposits 348,974 1.00% 381,789 0.85% Time deposits 3,669,048 4.74% 3,177,397 3.71% Total interest-bearing deposits $4,922,112 4.09% $4,379,915 3.15% Federal funds purchased 30,039 5.35% 45,193 4.76% Securities sold under agreements to repurchase 724,616 3.69% 340,331 3.87% Other borrowed funds 952,862 5.00% 489,663 4.67% Long-term debt 131,493 7.48% 53,990 8.03% Total interest-bearing liabilities 6,761,122 4.24% 5,309,092 3.40% Non-interest-bearing demand deposits 778,183 747,063 Total deposits and other borrowed funds $7,539,305 $6,056,155 Total average assets $8,589,745 $6,970,728 Total average stockholders' equity $939,286 $819,876 For the three months ended, (In thousands) March 31, 2007 Interest-earning assets Average Average Balance Yield/Rate (1)(2) Loans and leases (1) $5,787,959 8.00% Taxable investment securities 1,578,706 5.60% Tax-exempt investment securities (2) 75,549 6.16% FHLB & FRB stock 44,957 4.59% Federal funds sold and securities purchased under agreements to resell 217,662 7.08% Deposits with banks 47,822 6.67% Total interest-earning assets $7,752,655 7.44% Interest-bearing liabilities Interest-bearing demand deposits $232,656 1.26% Money market 666,454 3.08% Savings deposits 344,336 1.00% Time deposits 3,654,859 4.72% Total interest-bearing deposits $4,898,305 4.07% Federal funds purchased 25,244 5.33% Securities sold under agreements to repurchase 616,418 3.76% Other borrowed funds 923,273 5.24% Long-term debt 105,156 7.62% Total interest-bearing liabilities 6,568,396 4.27% Non-interest-bearing demand deposits 772,268 Total deposits and other borrowed funds $7,340,664 Total average assets $8,389,776 Total average stockholders' equity $944,314 (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%. DATASOURCE: Cathay General Bancorp CONTACT: Heng W. Chen of Cathay General Bancorp, +1-213-625-4752 Web site: http://www.cathaybank.com/

Copyright