EAST WEST BANCORP INCEWBCEarnings & Financial Report

Item 1. Business — Supervision and Regulation — FDIC Deposit Insurance Assessments in this Form 10-K. Other operating expense was $148 million in 2024, an increase of $8 million or 6%, compared with 2023. The year-over-year increase was primarily due to write-downs of other real estate owned (“OREO”).

Amortization of tax credit and CRA investments was $54 million in 2024, a decrease of $66 million or 55%, compared with 2023.

The year-over-year decrease was primarily due to the expanded application of the PAM since the adoption of ASU 2023-02, Investments — Equity Method and Joint Ventures on January 1, 2024, and the timing of tax credit investments that closed in a given period.

Income Taxes The following table presents the income before income taxes, income tax expense and effective tax rate for the periods indicated: Year Ended December 31, ($ in thousands) 2024 2023 2022 Income before income taxes $ 1,481,861 $ 1,459,770 $ 1,411,654 Income tax expense $ 316,275 $ 298,609 $ 283,571 Effective tax rate 21.3 % 20.5 % 20.1 % 43 Income tax expense for 2024, compared with 2023, increased $18 million or 6%, primarily due to the impacts from the expanded application of PAM on the Company’s tax credit investments following the adoption of ASU 2023-02 on January 1, 2024, partially offset by an increase in tax credits and prior period adjustments in 2023.

The differences between the 2024 and 2023 effective tax rates from the federal statutory rate of 21% were primarily due to state taxes and tax credits associated with renewable energy, historic and new market tax credit related projects as described in Note 11 — Income Taxes to the Consolidated Financial Statements in this Form 10-K.

Operating Segment Results The Company organizes its operations into three reportable operating segments: (1) Consumer and Business Banking; (2) Commercial Banking; and (3) Treasury and Other. These segments are defined by the type of customers served, and the related products and services provided.

For a description of the Company’s internal management reporting process, including the segment cost allocation methodology, see Note 17 — Business Segments to the Consolidated Financial Statements in this Form 10-K.

Segment net interest income represents the difference between actual interest earned on assets and interest incurred on liabilities of the segment, adjusted for funding charges or credits through the Company’s internal funds transfer pricing (“FTP”) process.

During 2024, the Company refined its segment allocation methodology and reclassified certain deposits and their related income or expenses from the “Consumer and Business Banking” segment to the “Commercial Banking” or “Treasury and Other” segments, and certain loan balances and their related income or expenses from the “Commercial Banking” segment to the “Treasury and Other” segment.

Prior years’ balances have been reclassified for comparability. Consumer and Business Banking The Consumer and Business Banking segment primarily provides financial products and services to consumer and commercial customers through the Company’s domestic branch network and digital banking platforms. This segment offers consumer and commercial deposits, mortgage and home equity loans, and other products and services.

It also originates commercial loans for small- and medium-sized enterprises through the Company’s branch network. Other products and services provided by this segment include wealth management, private banking, treasury management, interest rate risk hedging and foreign exchange services.

The following table presents financial information for the Consumer and Business Banking segment for the periods indicated: Year Ended December 31, Change from 2023 ($ in thousands) 2024 2023 $ % 2022 Total revenue before provision for credit losses $ 1,260,806 $ 1,329,844 $ (69,038) (5) % $ 1,174,960 Provision for credit losses 8,691 21,454 (12,763) (59) % 25,983 Compensation and employee benefits 217,612 203,387 14,225 7 % 195,394 Other noninterest expense 234,494 262,086 (27,592) (11) % 196,581 Total noninterest expense 452,106 465,473 (13,367) (3) % 391,975 Segment income before income taxes 800,009 842,917 (42,908) (5) % 757,002 Income tax expense 236,791 247,952 (11,161) (5) % 219,248 Segment net income $ 563,218 $ 594,965 $ (31,747) (5) % $ 537,754 Average loans $ 18,966,662 $ 17,739,984 $ 1,226,678 7 % $ 15,534,259 Average deposits $ 30,815,912 $ 28,174,781 $ 2,641,131 9 % $ 27,276,151 44 Consumer and Business Banking segment net income decreased $32 million or 5% to $563 million in 2024, primarily due to a decrease in net interest income and higher compensation and employee benefits, partially offset by lower other noninterest expense and provision for credit losses.

The decrease in net interest income before provision for credit losses was primarily driven by a higher cost of interest-bearing deposits and a continued shift to interest-bearing products in the deposit mix. The decrease in provision for credit losses was primarily driven by the improvement in the macroeconomic outlook in the residential mortgage loan sector.

The increase in compensation and employee benefits was primarily driven by annual merit increases and staffing growth. The decrease in other noninterest expense was primarily driven by lower deposit insurance premiums and regulatory assessments compared with the higher FDIC special assessment charge recognized in 2023. Commercial Banking The Commercial Banking segment primarily generates domestic commercial loan and deposit products.

Commercial loan products include CRE lending, construction finance, commercial business lending, working capital lines of credit, trade finance, letters of credit, affordable housing lending, asset-based lending, asset-backed finance, project finance and equipment financing. Commercial deposit products and other financial services include treasury management, foreign exchange services, and interest rate and commodity risk hedging.

The following table presents financial information for the Commercial Banking segment for the periods indicated: Year Ended December 31, Change from 2023 ($ in thousands) 2024 2023 $ % 2022 Total revenue before provision for credit losses $ 1,323,711 $ 1,284,515 $ 39,196 3 % $ 1,162,523 Provision for credit losses 166,953 100,391 66,562 66 % 48,248 Compensation and employee benefits 234,240 217,663 16,577 8 % 211,355 Other noninterest expense 161,969 158,949 3,020 2 % 102,018 Total noninterest expense 396,209 376,612 19,597 5 % 313,373 Segment income before income taxes 760,549 807,512 (46,963) (6) % 800,902 Income tax expense 224,897 237,359 (12,462) (5) % 230,920 Segment net income $ 535,652 $ 570,153 $ (34,501) (6) % $ 569,982 Average loans $ 32,996,221 $ 31,365,547 $ 1,630,674 5 % $ 29,321,701 Average deposits $ 25,820,956 $ 23,304,066 $ 2,516,890 11 % $ 23,252,073 Commercial Banking segment net income decreased $35 million or 6% to $536 million in 2024, primarily driven by increases in provision for credit losses and compensation and employee benefits, partially offset by higher noninterest income.

The increase in noninterest income was primarily driven by higher lending and deposit account fees. The increase in provision for credit losses was primarily driven by higher net charge-offs in the C&I portfolio. The increase in compensation and employee benefits was primarily driven by annual merit increases and staffing growth.

Treasury and Other Centralized functions, including the corporate treasury activities of the Company, eliminations of inter-segment amounts, and centrally managed departments, have been aggregated and included in the Treasury and Other segment.

Tax credit investment amortization is recorded in the Treasury and Other segment. 45 The following table presents financial information for the Treasury and Other segment for the periods indicated: Year Ended December 31, Change from 2023 ($ in thousands) 2024 2023 $ % 2022 Total revenue (loss) before (reversal of) provision for credit losses $ 29,417 $ (6,841) $ 36,258 NM $ 7,064 (Reversal of) provision for credit losses (1,644) 3,155 (4,799) NM (731) Compensation and employee benefits 98,882 87,488 11,394 13 % 70,886 Other noninterest expense 10,876 93,175 (82,299) (88) % 83,159 Total noninterest expense 109,758 180,663 (70,905) (39) % 154,045 Segment loss before income taxes (78,697) (190,659) 111,962 59 % (146,250) Income tax benefit (145,413) (186,702) 41,289 22 % (166,597) Segment net income (loss) $ 66,716 $ (3,957) $ 70,673 NM $ 20,347 Average loans $ 405,897 $ 439,605 $ (33,708) (8) % $ 463,498 Average deposits $ 3,036,171 $ 3,483,884 $ (447,713) (13) % $ 3,771,355 NM — Not meaningful.

Treasury and Other segment loss before income taxes decreased $112 million in 2024, primarily driven by lower noninterest expense and higher net interest income. The increase in net interest income was primarily driven by higher interest income from AFS debt securities.

The decrease in noninterest expense was primarily due to lower amortization of tax credit and CRA investments resulting from the expanded application of PAM since the adoption of ASU 2023-02 on January 1, 2024, where the amortization of tax credit and CRA investments were recorded as a component of income tax benefit in this segment.

Income tax expense is allocated to the Consumer and Business Banking and the Commercial Banking segments by applying statutory income tax rates to the respective segment income before income taxes.

The income tax expense or benefit in the Treasury and Other segment consists of the remaining unallocated income tax expense or benefit after allocating income tax expense to the two core segments, and the impact of tax credit investment activity.

Balance Sheet Analysis Debt Securities The Company maintains a portfolio of high quality and liquid debt securities with a moderate duration profile. It closely manages the overall portfolio credit, interest rate and liquidity risks.

The Company’s debt securities provide: • interest income for earnings and yield enhancement; • funding availability for needs arising during the normal course of business; • the ability to execute interest rate risk management strategies in response to changes in economic or market conditions; and • collateral to support pledging agreements as required and/or to enhance the Company’s borrowing capacity.

While the Company does not intend to sell its debt securities, it may sell AFS debt securities in response to changes in the balance sheet and related interest rate risk to meet liquidity, regulatory and strategic requirements. 46 The following table presents the distribution of the Company’s AFS and HTM debt securities portfolio as of December 31, 2024 and 2023, and by credit ratings as of December 31, 2024: December 31, 2024 December 31, 2023 Rating as of December 31, 2024 (1) ($ in thousands) Amortized Cost Fair Value % of Fair Value Amortized Cost Fair Value % of Fair Value AAA/AA A BBB BB and Lower No Rating (2) AFS debt securities: U.S.

Treasury securities $ 676,300 $ 638,265 6 % $ 1,112,587 $ 1,060,375 17 % 100 % — % — % — % — % U.S. government agency and U.S. government-sponsored enterprise debt securities 308,220 262,587 3 % 412,086 364,446 6 % 100 % — % — % — % — % U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities (3) 8,447,303 8,164,474 75 % 2,488,304 2,195,853 35 % 100 % — % — % — % — % Municipal securities 287,301 250,153 2 % 297,283 261,016 4 % 99 % — % — % — % 1 % Non-agency mortgage-backed securities 808,762 692,078 6 % 1,052,913 921,187 15 % 91 % 1 % 1 % — % 7 % Corporate debt securities 653,500 526,166 5 % 653,501 502,425 8 % — % 31 % 65 % 4 % — % Foreign government bonds 244,803 233,880 2 % 239,333 227,874 4 % 45 % 55 % — % — % — % Asset-backed securities 35,086 34,715 0 % 43,234 42,300 1 % 29 % 71 % — % — % — % Collateralized loan obligations 44,500 44,493 1 % 617,250 612,861 10 % 100 % — % — % — % — % Total AFS debt securities $ 11,505,775 $ 10,846,811 100 % $ 6,916,491 $ 6,188,337 100 % 93 % 3 % 3 % 0 % 1 % HTM debt securities: U.S.

Treasury securities $ 535,080 $ 499,858 21 % $ 529,548 $ 488,551 20 % 100 % — % — % — % — % U.S. government agency and U.S. government-sponsored enterprise debt securities 1,004,479 804,220 34 % 1,001,836 814,932 33 % 100 % — % — % — % — % U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities (4) 1,190,221 943,134 39 % 1,235,784 1,004,697 41 % 100 % — % — % — % — % Municipal securities 187,633 140,542 6 % 188,872 145,791 6 % 100 % — % — % — % — % Total HTM debt securities $ 2,917,413 $ 2,387,754 100 % $ 2,956,040 $ 2,453,971 100 % 100 % — % — % — % — % Total debt securities $ 14,423,188 $ 13,234,565 $ 9,872,531 $ 8,642,308 (1) Credit ratings express opinions about the credit quality of a debt security.

The Company determines the credit rating of a security according to the lowest credit rating made available by nationally recognized statistical rating organizations (“NRSROs”). Investment grade debt securities are those with ratings similar to BBB- or above (as defined by NRSROs), and are generally considered by the rating agencies and market participants to be low credit risk.

Ratings percentages are allocated based on fair values. (2) For debt securities not rated by NRSROs, the Company uses other factors which include but are not limited to the priority in collections within the securitization structure, and whether the contractual payments have historically been on time.

(3) Includes Government National Mortgage Association (“GNMA”) AFS debt securities totaling $7.3 billion of amortized cost and $7.2 billion of fair value as of December 31, 2024, and $1.3 billion of amortized cost and $1.2 billion of fair value as of December 31, 2023.

(4) Includes GNMA HTM debt securities totaling $86 million of amortized cost and $68 million of fair value as of December 31, 2024, and $92 million of amortized cost and $75 million of fair value of as of December 31, 2023.

As of December 31, 2024, the Company’s AFS and HTM debt securities portfolios had an effective duration (defined as the sensitivity of the value of the portfolio to interest rate changes) of 2.4 and 7.0, respectively, compared with 3.6 and 7.5, respectively, as of December 31, 2023.

The decrease in the AFS effective duration was primarily due to the purchases of floating rate GNMA securities during 2024. The decrease in the HTM effective duration was due to the portfolio seasoning.

The Company estimated that the effective duration of its AFS debt securities was 3.1 for an instantaneous 100 bp parallel increase and 2.1 for an instantaneous 100 bp parallel decrease as of December 31, 2024. 47 Available-for-Sale Debt Securities The fair value of AFS debt securities increased $4.7 billion or 75% to $10.8 billion in 2024 from December 31, 2023, primarily due to the purchases of GNMA securities.

The Company’s AFS debt securities are carried at fair value with non-credit related unrealized gains and losses, net of tax, reported in Other comprehensive income (loss) on the Consolidated Statement of Comprehensive Income. Pre-tax net unrealized losses on AFS debt securities were $659 million as of December 31, 2024, compared with $728 million as of December 31, 2023.

As of December 31, 2024 and 2023, 99% and 97%, respectively, of the carrying value of the AFS debt securities portfolio was rated investment grade by NRSROs. Of the AFS debt securities with gross unrealized losses, substantially all were rated investment grade as of both December 31, 2024 and 2023.

There was no allowance for credit losses provided against the AFS debt securities as of both December 31, 2024 and 2023. Additionally, there were no credit losses recognized in earnings for both 2024 and 2023. Held-to-Maturity Debt Securities All HTM debt securities were issued, guaranteed, or supported by the U.S. government or government-sponsored enterprises.

Accordingly, the Company applied a zero credit loss assumption for these securities and no allowance for credit loss was recorded as of both December 31, 2024 and 2023.