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What changed in EAST WEST BANCORP INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of EAST WEST BANCORP INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+349 added−370 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in EAST WEST BANCORP INC's 2025 10-K

349 paragraphs added · 370 removed · 278 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

115 edited+29 added−22 removed27 unchanged
Biggest changeMD&A — Critical Accounting Estimates, Note 1 — Summary of Significant Accounting Policies and Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K. 62 The following table presents an allocation of the allowance for loan losses by loan portfolio segments and unfunded credit commitments as of the periods indicated: December 31, 2024 2023 ($ in thousands) Allowance Allocation % of Loan Type to Total Loans Allowance Allocation % of Loan Type to Total Loans Allowance for loan losses Commercial: C&I $ 384,319 32 % $ 392,685 32 % CRE: CRE 218,677 28 % 170,592 28 % Multifamily residential 32,117 9 % 34,375 10 % Construction and land 17,497 1 % 10,469 1 % Total CRE 268,291 38 % 215,436 39 % Total commercial 652,610 70 % 608,121 71 % Consumer: Residential mortgage: Single-family residential 44,816 27 % 55,018 26 % HELOCs 3,132 3 % 3,947 3 % Total residential mortgage 47,948 30 % 58,965 29 % Other consumer 1,494 0 % 1,657 0 % Total consumer 49,442 30 % 60,622 29 % Total allowance for loan losses $ 702,052 100 % $ 668,743 100 % Allowance for unfunded credit commitments $ 39,526 $ 37,699 Total allowance for credit losses $ 741,578 $ 706,442 Loans held-for-investment $ 53,726,637 $ 52,210,782 Allowance for loan losses to loans held-for-investment 1.31 % 1.28 % 63 The following table presents net charge-offs and the net charge-offs to average loans ratios based on the loan categories as of the periods indicated: December 31, 2024 2023 ($ in thousands) Net Charge-Offs (Recoveries) Average Loans Held-for-Investment % of Net Charge-Offs (Recoveries) to Average Loans Held-for-Investment Net Charge-Offs (Recoveries) Average Loans Held-for-Investment % of Net Charge-Offs (Recoveries) to Average Loans Held-for-Investment Commercial: C&I $ 118,908 $ 16,490,180 0.72 % $ 29,770 $ 15,497,693 0.19 % CRE: CRE 13,823 14,587,444 0.09 % 6,616 14,312,459 0.05 % Multifamily residential (426) 5,061,821 (0.01) % (542) 4,756,885 (0.01) % Construction and land 2,086 666,748 0.31 % 10,177 754,928 1.35 % Total CRE 15,483 20,316,013 0.08 % 16,251 19,824,272 0.08 % Total commercial 134,391 36,806,193 0.37 % 46,021 35,321,965 0.13 % Consumer: Residential mortgage: Single-family residential 26 13,753,247 0.00 % (69) 12,274,773 0.00 % HELOCs (58) 1,751,500 0.00 % 105 1,881,008 0.01 % Total residential mortgage (32) 15,504,747 0.00 % 36 14,155,781 0.00 % Other consumer 4,259 55,500 7.67 % 197 65,181 0.30 % Total consumer 4,227 15,560,247 0.03 % 233 14,220,962 0.00 % Total $ 138,618 $ 52,366,440 0.26 % $ 46,254 $ 49,542,927 0.09 % Liquidity Risk Management Liquidity.
Biggest changeMD&A — Critical Accounting Estimates, Note 1 — Summary of Significant Accounting Policies and Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K. 61 The following table presents the allowance for credit losses allocated by loan portfolio segments, debt securities and unfunded credit commitments as of the periods indicated: December 31, 2025 2024 ($ in thousands) Allowance Allocation % of Loan Type to Total Loans Allowance Allocation % of Loan Type to Total Loans ALLL Commercial: C&I $ 475,613 33 % $ 384,319 32 % CRE: CRE 221,494 27 % 218,677 28 % Multifamily residential 36,555 9 % 32,117 9 % Construction and land 15,468 1 % 17,497 1 % Total CRE 273,517 37 % 268,291 38 % Total commercial 749,130 70 % 652,610 70 % Consumer: Residential mortgage: Single-family residential 53,463 27 % 44,816 27 % HELOCs 5,804 3 % 3,132 3 % Total residential mortgage 59,267 30 % 47,948 30 % Other consumer 1,376 0 % 1,494 0 % Total consumer 60,643 30 % 49,442 30 % Total ALLL $ 809,773 100 % $ 702,052 100 % Allowance for debt securities $ 1,900 $ — Allowance for unfunded credit commitments $ 48,690 $ 39,526 Total allowance for credit losses $ 860,363 $ 741,578 Loans held-for-investment $ 56,878,172 $ 53,726,637 ALLL to loans held-for-investment 1.42 % 1.31 % 62 The following table presents net charge-offs and the net charge-offs to average loans ratios based on the loan categories as of the periods indicated: December 31, 2025 2024 ($ in thousands) Net Charge-Offs (Recoveries) Average Loans Held-for-Investment % of Net Charge-Offs (Recoveries) to Average Loans Held-for-Investment Net Charge-Offs (Recoveries) Average Loans Held-for-Investment % of Net Charge-Offs (Recoveries) to Average Loans Held-for-Investment Commercial: C&I $ 34,275 $ 17,440,477 0.20 % $ 118,908 $ 16,490,180 0.72 % CRE: CRE 24,008 15,003,349 0.16 % 13,823 14,587,444 0.09 % Multifamily residential (52) 4,991,171 0.00 % (426) 5,061,821 (0.01) % Construction and land 1,984 715,283 0.28 % 2,086 666,748 0.31 % Total CRE 25,940 20,709,803 0.13 % 15,483 20,316,013 0.08 % Total commercial 60,215 38,150,280 0.16 % 134,391 36,806,193 0.37 % Consumer: Residential mortgage: Single-family residential (249) 14,571,485 0.00 % 26 13,753,247 0.00 % HELOCs (16) 1,848,861 0.00 % (58) 1,751,500 0.00 % Total residential mortgage (265) 16,420,346 0.00 % (32) 15,504,747 0.00 % Other consumer (111) 47,456 (0.23) % 4,259 55,500 7.67 % Total consumer (376) 16,467,802 0.00 % 4,227 15,560,247 0.03 % Total $ 59,839 $ 54,618,082 0.11 % $ 138,618 $ 52,366,440 0.26 % Liquidity Risk Management Liquidity.
When early warning indicators are triggered, management will evaluate the severity of the emerging liquidity problem and exercise appropriate management actions to address any liquidity and funding shortfalls. Liquidity Sources. The Company’s primary source of funding is from deposits, generated by its banking business, which we believe is a relatively stable and low-cost source of funding.
When early warning indicators are triggered, management will evaluate the severity of the emerging liquidity problem and exercise appropriate management actions to address any liquidity and funding shortfalls. Liquidity Sources — Deposits. The Company’s primary source of funding is from deposits, generated by its banking business, which we believe is a relatively stable and low-cost source of funding.
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.
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 47 • collateral to support pledging agreements as required and/or to enhance the Company’s borrowing capacity.
It identifies the Company’s major risk categories as: credit, liquidity, market, operational, reputational, legal, compliance, BSA/AML & OFAC, strategic, and technology risk. The ROC of the Board of Directors monitors the ERM program through such identified enterprise risk categories and provides oversight of the Company’s risk appetite and control environment.
It identifies the Company’s major risk categories as: credit, liquidity, market, operational, reputational, legal, compliance, BSA/AML & OFAC, strategic, and technology risk. 58 The ROC of the Board of Directors monitors the ERM program through such identified enterprise risk categories and provides oversight of the Company’s risk appetite and control environment.
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.
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 process.
Accordingly, the Company offers a wide variety of deposit products to meet the needs of its consumer and commercial customers. As a result, we believe our deposit base is seasoned, stable and well-diversified.
The Company offers a wide variety of deposit products to meet the needs of its consumer and commercial customers. As a result, we believe our deposit base is seasoned, stable and well-diversified.
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.
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 reflects the impact of tax credit investment activity.
Excess cash generated by operating and investing activities may be used to repay outstanding debt or invest in liquid assets. Liquidity for East West.
Excess cash generated by operating and investing activities may be used to repay outstanding debt or invest in liquid assets. 65 Liquidity for East West.
(2) Deposits of our Hong Kong branch and China subsidiary, primarily a subset of Commercial Banking segment deposits. (3) Treasury and Other segment deposits reflect wholesale, public funds, and brokered deposits, primarily managed by the Company’s Treasury department. Customer deposit accounts in the U.S. offices are insured by the FDIC for up to $250,000.
(2) Deposits of our Hong Kong branch and China subsidiary bank branches are a subset of Commercial Banking segment deposits. (3) Treasury and Other segment deposits reflect wholesale, public funds, and brokered deposits, primarily managed by the Company’s Treasury department. Customer deposit accounts in the U.S. offices are insured by the FDIC for up to $250,000.
The Company was in a first lien position for all of its single-family residential loans as of both December 31, 2024 and 2023. Many of these loans are reduced documentation loans, for which a substantial down payment is required, resulting in a low LTV ratio at origination, typically 65% or less.
The Company was in a first lien position in all of its single-family residential loans as of both December 31, 2025 and 2024. Many of these loans are reduced documentation loans, for which a substantial down payment is required, resulting in a low LTV ratio at origination, typically 65% or less.
As of December 31, 2024, the Company believes it has adequate liquidity resources to conduct operations and meet other needs in the ordinary course of business, and is not aware of any events that are reasonably likely to have a material adverse effect on its liquidity, capital resources or operations.
As of December 31, 2025, the Company believes it has adequate liquidity resources to conduct operations and meet other needs in the ordinary course of business, and is not aware of any events that are reasonably likely to have a material adverse effect on its liquidity, capital resources or operations.
Additional information about the Company’s loan commitments, commercial letters of credit and SBLCs is provided in Note 12 — Commitments and Contingencies to the Consolidated Financial Statements in this Form 10-K. The Consolidated Statement of Cash Flows summarizes the Company’s sources and uses of cash by type of activity for 2024, 2023 and 2022.
Additional information about the Company’s loan commitments, commercial letters of credit and SBLCs is provided in Note 12 — Commitments and Contingencies to the Consolidated Financial Statements in this Form 10-K. The Consolidated Statement of Cash Flows summarizes the Company’s sources and uses of cash by type of activity for 2025, 2024 and 2023.
Management believes that East West has sufficient cash and cash equivalents to meet the projected cash obligations for the coming year. Liquidity Stress Testing. The Company utilizes liquidity stress analysis to determine the appropriate amounts of liquidity to maintain at the Company, foreign subsidiary and foreign branch to meet contractual and contingent cash outflows under a range of scenarios.
Management believes that East West has sufficient sources of liquidity to meet the projected cash obligations for the coming year. Liquidity Stress Testing. The Company utilizes liquidity stress analysis to determine the appropriate amounts of liquidity to maintain at the Company, foreign subsidiary and foreign branch to meet contractual and contingent cash outflows under a range of scenarios.
The deposits in the Company’s subsidiary bank in China and the branch in Hong Kong are insured by each jurisdiction’s deposit insurance authority for up to 500,000 RMB and 800,000 HKD, respectively. Uninsured deposits represent the portion of deposit accounts that exceed the insurance limits of the FDIC and each foreign jurisdiction.
The deposits in the Company’s subsidiary bank in China and the branch in Hong Kong are insured by each jurisdiction’s deposit insurance authority for up to 500,000 RMB and 800,000 Hong Kong Dollars, respectively. Uninsured deposits represent the portion of deposit accounts that exceed the insurance limits of the FDIC and each foreign jurisdiction.
The Company is committed to maintaining strong capital levels to assure its investors, customers and regulators that the Company and the Bank are financially sound. As of both December 31, 2024 and 2023, the Company and the Bank continued to exceed all “well-capitalized” capital requirements and the required minimum capital requirements under the Basel III Capital Rules.
The Company is committed to maintaining strong capital levels to assure its investors, customers and regulators that the Company and the Bank are financially sound. As of both December 31, 2025 and 2024, the Company and the Bank continued to exceed all “well-capitalized” capital requirements and the required minimum capital requirements under the Basel III Capital Rules.
Risk Factors — Risks Related to Geopolitical Uncertainties and Risks Related to Financial Matters in this Form 10-K. Commercial — Commercial Real Estate Loans. The Company focuses on providing financing to experienced real estate investors and developers who have moderate levels of leverage, many of whom are long-time customers of the Bank.
Risk Factors — Risks Related to Geographic and Political Uncertainties and Risks Related to Financial Matters in this Form 10-K. Commercial — Commercial Real Estate Loans. The Company focuses on providing financing to experienced real estate investors and developers who have moderate levels of leverage, many of whom are long-time customers of the Bank.
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.
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, 2025 and 2024.
The Bank is subject to various statutory and regulatory restrictions on its ability to pay dividends as discussed in Item 1 . Business — Supervision and Regulation — Dividends and Other Transfers of Funds in this Form 10-K. East West held $395 million and $446 million in cash and cash equivalents as of December 31, 2024 and 2023, respectively.
The Bank is subject to various statutory and regulatory restrictions on its ability to pay dividends as discussed in Item 1 . Business — Supervision and Regulation — Dividends and Other Transfers of Funds in this Form 10-K. East West held $664 million and $395 million in cash and cash equivalents as of December 31, 2025 and 2024, respectively.
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.
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 $406 million as of December 31, 2025, compared with $659 million as of December 31, 2024.
The Company believes its liquidity management practices have been effective under normal operating and stressed market conditions. 64 The Company also maintains a Contingency Funding Plan that utilizes early-warning indicators that will be monitored to provide timely detection of adverse liquidity situations and enable management to promptly respond.
The Company believes its liquidity management practices have been effective under normal operating and stressed market conditions. 63 The Company also maintains a Contingency Funding Plan that utilizes early-warning indicators that are monitored to provide timely detection of adverse liquidity situations and enable management to promptly respond.
In addition to deposits, the Company has access to various sources of wholesale financing, including borrowing capacity with the FHLB and FRB, and several master repurchase agreements with major brokerage companies to sustain an adequate liquid asset portfolio, meet daily cash demands and allow management flexibility to execute its business strategy.
In addition to deposits, the Company has access to various sources of wholesale financing, including borrowing capacity with the FHLB and FRB discount window, FRB Standing Repurchase Agreement Facility (“SRF”), and several master repurchase agreements with major brokerage companies to sustain an adequate liquid asset portfolio, meet daily cash demands and allow management flexibility to execute its business strategy.
For additional information on these obligations, see the following Notes to the Consolidated Financial Statements in this Form 10-K: • Note 7 — Affordable Housing Partnership, Tax Credit and Community Reinvestment Act Investments, Net • Note 9 — Deposits • Note 10 — Short-Term Borrowings and Long-Term Debt The Company also has off-balance sheet arrangements which represent transactions that are not recorded on the Consolidated Balance Sheet.
For additional information on these obligations, see the following Notes to the Consolidated Financial Statements in this Form 10-K: • Note 7 — Affordable Housing Partnership, Tax Credit and Community Reinvestment Act Investments, Net • Note 9 — Deposits • Note 10 — Federal Home Loan Bank Advances and Long-Term Debt The Company also has off-balance sheet arrangements which represent transactions that are not recorded on the Consolidated Balance Sheet.
Commercial The Company actively monitors the commercial lending portfolio for credit risk and reviews credit exposures for sensitivity to changing economic conditions. Commercial — Commercial and Industrial Loans. Total C&I loan commitments were $25.8 billion and $24.6 billion as of December 31, 2024 and 2023, respectively, with a utilization rate of 67% as of both dates.
The Company actively monitors the commercial lending portfolio for credit risk and reviews credit exposures for sensitivity to changing economic conditions. Commercial — Commercial and Industrial Loans. Total C&I loan commitments were $27.7 billion and $25.8 billion as of December 31, 2025 and 2024, respectively, with a utilization rate of 67% as of both dates.
Total HELOC commitments were $5.3 billion and $5.2 billion as of December 31, 2024 and 2023, respectively, with a utilization rate of 34% as of December 31, 2024, compared with 33% as of December 31, 2023. Substantially all of the Company’s unfunded HELOC commitments are unconditionally cancellable.
Total HELOC commitments were $5.5 billion and $5.3 billion as of December 31, 2025 and 2024, respectively, with a utilization rate of 35% as of December 31, 2025, compared with 34% as of December 31, 2024. Substantially all of the Company’s unfunded HELOC commitments are unconditionally cancellable.
Other nonperforming assets and OREO are repossessed assets and properties, respectively, acquired through foreclosure, or through full or partial satisfaction of loans held-for-investment.
Other nonperforming assets and OREO are repossessed assets and properties, respectively, acquired through foreclosure, or through full or partial satisfaction of loans held-for-investment. Nonperforming assets may also include nonperforming loans HFS.
The Company offers a variety of single-family residential first lien mortgage loan programs, including fixed- and variable-rate loans, as well as hybrid loans with interest rates that adjust on a regular basis, typically annually, after an initial fixed-rate period. Consumer — Home Equity Lines of Credit.
The Company offers a variety of single-family residential mortgage loan programs, including fixed- and variable-rate loans, as well as hybrid loans with interest rates that adjust on a regular basis, typically annually, after an initial fixed rate period.
Treasury securities, and foreign government bonds as of December 31, 2024; comprised of U.S. Treasury securities and foreign government bonds as of December 31, 2023. (2) Primarily comprised of C&I loans as of both December 31, 2024 and 2023. (3) Comprised of foreign government bonds as of both December 31, 2024 and 2023.
Treasury securities, and foreign government bonds as of both December 31, 2025 and 2024. (2) Primarily comprised of C&I loans as of both December 31, 2025 and 2024. (3) Comprised of foreign government bonds as of both December 31, 2025 and 2024.
Accordingly, the Company believes the cash and cash equivalents, and available collateralized borrowing capacity described below provide sufficient liquidity above its expected cash needs. The Company maintains its source of liquidity in the form of cash and cash equivalents and borrowing capacity with its eligible loans and debt securities as collateral.
Accordingly, the Company believes the cash and cash equivalents, and available collateralized borrowing capacity described below provide sufficient liquidity above its expected cash needs. 64 The Company maintains its sources of liquidity in the form of cash and cash equivalents, unpledged and prepositioned debt securities, and secured borrowing capacity with eligible loans and debt securities pledged as collateral.
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.
In comparison, there was no allowance for credit losses against AFS debt securities as of December 31, 2024. Held-to-Maturity Debt Securities All HTM debt securities were issued, guaranteed, or supported by the U.S. government or government-sponsored enterprises.
(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.
(3) Includes Government National Mortgage Association (“GNMA”) AFS debt securities totaling $9.6 billion of both amortized cost and fair value as of December 31, 2025, and $7.3 billion of amortized cost and $7.2 billion of fair value as of December 31, 2024.
The Company offers a variety of first lien mortgages, including fixed- and variable-rate loans, as well as hybrid loans with interest rates that adjust annually after an initial fixed rate period of three to ten years.
The Company offers a variety of first lien mortgages, including fixed- and variable-rate loans, as well as hybrid loans with interest rates that adjust annually after an initial fixed rate period of three to ten years. The Company also offers hedging products to our customers to manage their interest rate risks.
There is no requirement on CET1 capital ratio or Tier 1 leverage ratio for a well-capitalized bank holding company. (2) The well-capitalized Tier 1 capital ratio requirements for the Company and the Bank are 6.0% and 8.0%, respectively.
There are no well-capitalized requirements on CET1 capital ratio or Tier 1 leverage ratio for bank holding companies. (3) Well-capitalized Tier 1 capital ratio requirements for the Company and the Bank are 6.0% and 8.0%, respectively.
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.
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 based on customer type, the channels where customers are served, and the products and services provided.
Our loans are funded by deposits, which amounted to $63.2 billion as of December 31, 2024, compared with $56.1 billion as of December 31, 2023. The Company’s loan-to-deposit ratio was 85% as of December 31, 2024, compared with 93% as of December 31, 2023.
Our loans are funded by deposits, which amounted to $67.1 billion as of December 31, 2025, compared with $63.2 billion as of December 31, 2024. The Company’s loan-to-deposit ratio was 85% as of both December 31, 2025 and 2024.
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.
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.
The Senior Credit Supervision function manages credit policy for the line of business transactional credit risk, assuring that all exposure is risk-rated according to the requirements of the credit risk rating policy. The Senior Credit Supervision function also evaluates and reports the overall credit risk exposure to senior management and the ROC.
The Senior Credit Supervision function manages credit policy for the line of business transactional credit risk, assuring that all exposure is risk-rated according to the requirements of the credit risk rating policy.
In January 2025, the Company’s Board of Directors declared a first quarter 2025 cash dividend of $0.60 per share, which represents a 9% or five cents per share increase from the previous quarter. The dividend was paid on February 17, 2025, to stockholders of record as of February 3, 2025.
In January 2026, the Company’s Board of Directors declared a first quarter 2026 cash dividend of $0.80 per share, which represents a 33%, or 20 cents per common share, increase from the previous quarterly cash dividend of $0.60 per common share. The dividend was paid on February 17, 2026, to stockholders of record as of February 2, 2026.
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.
The differences between the 2025 and 2024 effective tax rates from the federal statutory rate of 21% were primarily due to state taxes, partially offset by tax credits associated with energy, affordable housing, historic and new market tax credit investments. Refer to Note 11 — Income Taxes to the Consolidated Financial Statements in this Form 10-K.
The third line of defense is comprised of the Internal Audit and Independent Asset Review (“IAR”) functions. Internal Audit reports to the Chief Audit Executive (“CAE”) who reports to the Board’s Audit Committee. Internal Audit provides assurance and evaluates the effectiveness of risk management, control, and governance processes as established by the Company.
Internal Audit reports to the Chief Audit Executive (“CAE”) who reports to the Board’s Audit Committee. Internal Audit provides assurance and evaluates the effectiveness of risk management, control, and governance processes as established by the Company.
As of December 31, 2024, total C&I loans were $17.4 billion, up $816 million or 5% from December 31, 2023. The C&I loan portfolio includes loans and financing for businesses across a wide spectrum of industries.
As of December 31, 2025, total C&I loans were $18.7 billion, up $1.3 billion or 7% from December 31, 2024. The C&I loan portfolio includes loans and financing for businesses across a wide spectrum of industries.
The first line of defense is comprised of revenue generating, operational and support units. The second line of defense is comprised of risk management and control functions that provide independent risk oversight of first line activities and report to the Chief Risk Officer. The Chief Risk Officer reports to both the ROC and the Chief Executive Officer.
The second line of defense is comprised of risk management and control functions that provide independent risk oversight of first line activities and report to the Chief Risk Officer. The Chief Risk Officer reports to both the ROC and the Chief Executive Officer. The third line of defense is comprised of the Internal Audit and Independent Asset Review (“IAR”) functions.
Consumer Residential mortgage loans are primarily originated through the Bank’s branch network . The average total residential loan size was $437 thousand and $436 thousand as of December 31, 2024 and 2023, respectively.
Land loans totaled $198 million and $160 million as of December 31, 2025 and 2024, respectively. 52 Consumer Residential mortgage loans are primarily originated through the Bank’s branch network . The average residential mortgage loan size was $439 thousand and $437 thousand as of December 31, 2025 and 2024, respectively.
The weighted-average LTV ratio was 52% and 53% as of December 31, 2024 and 2023, respectively. These loans have historically experienced low delinquency and loss rates.
The weighted-average LTV ratio was 52% as of both December 31, 2025 and 2024. These loans have historically experienced low delinquency and loss rates. Consumer — Home Equity Lines of Credit.
Because many of these commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future funding requirements. The Company does not expect the total commitment amounts as of December 31, 2024 to have a material current or future impact on the Company’s financial conditions or results of operations.
A portion of these commitments are expected to expire unused or only partially used, therefore the total commitment amounts do not necessarily represent future cash requirements. The Company does not expect the total commitment amounts as of December 31, 2025 to have a material current or future impact on the Company’s financial conditions or results of operations.
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.
(4) Includes GNMA HTM debt securities totaling $79 million of amortized cost and $65 million of fair value as of December 31, 2025, and $86 million of amortized cost and $68 million of fair value as of December 31, 2024. 48 As of December 31, 2025, 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 3.0 and 5.9, respectively, compared with 2.0 and 6.2, respectively, as of December 31, 2024.
In comparison, $40 million or 39% of nonaccrual loans were less than 90 days delinquent as of December 31, 2023.
As of December 31, 2025, $27 million or 16% of nonaccrual loans were less than 90 days delinquent. In comparison, $49 million or 31% of nonaccrual loans were less than 90 days delinquent as of December 31, 2024.
Reporting directly to the Board’s Audit Committee, the IAR function provides additional validation of support to the Company’s robust credit risk management culture by performing an independent and objective assessment of underwriting and documentation quality. A key focus of our credit risk management is adherence to a well-controlled underwriting and loan monitoring process.
Reporting directly to the Board’s Audit Committee, the IAR function provides additional validation support to the Company’s robust credit risk management culture by performing an independent and objective assessment of underwriting and documentation quality and serves as an assurance function for the risk rating of the Company’s loan portfolios.
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.
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, equipment financing, and loan syndication.
As of December 31, 2024, 50% of our multifamily residential portfolio had variable rates, of which 45% had customer-level interest rate derivative contracts in place. In comparison, as of December 31, 2023, 48% of our multifamily residential loan portfolio had variable rates, of which 40% had customer-level interest rate derivative contracts in place.
As of December 31, 2025, of th e 51% of our multifamily residential portfolio that had variable rates, 50% had customer-level interest rate derivative contracts in place. In comparison, as of December 31, 2024, of the 50% of our multifamily residential loan portfolio that was variable rate, half had customer-level interest rate derivative contracts in place.
Interest rates on CRE loans may be fixed, variable or hybrid. As of December 31, 2024, 57% of our CRE portfolio had variable rates, of which 52% had customer-level interest rate derivative contracts in place. These were hedging contracts offered by the Company to help our customers manage their interest rate risk while the Bank’s exposure remained variable rate.
Interest rates on CRE loans may be fixed, variable or hybrid. The Company offers derivative hedging products to our customers to manage their interest rate risks. As of December 31, 2025, of the 58% of our CRE portfolio that had variable rates , 52% had customer-level interest rate derivative contracts in place.
The Company assesses the overall performance and credit quality of the loans held-for-investment portfolio through an integrated analysis of specific performance ratios. This approach forms the basis of the discussion in the sections immediately following: Credit Quality, Nonperforming Assets, and Allowance for Credit Losses. Credit Quality The Company utilizes a credit risk rating system to assist in monitoring credit quality.
This approach forms the basis of the discussion in the sections immediately following: Credit Quality, Nonperforming Assets, and Allowance for Credit Losses. Credit Quality The Company utilizes a credit risk rating system to assist in monitoring credit quality. Loans are evaluated using the Company’s internal credit risk rating of 1 through 10.
For more information on the Company’s credit quality indicators and internal credit risk ratings, refer to Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K. 60 The following table presents the Company’s criticized loans as of December 31, 2024 and 2023: Change ($ in thousands) December 31, 2024 December 31, 2023 $ % Criticized loans: Special mention loans $ 447,290 $ 404,241 $ 43,049 11 % Classified loans (1) 725,863 573,969 151,894 26 % Total criticized loans (2) $ 1,173,153 $ 978,210 $ 194,943 20 % Special mention loans to loans held-for-investment 0.83 % 0.77 % Classified loans to loans held-for-investment 1.35 % 1.10 % Criticized loans to loans held-for-investment 2.18 % 1.87 % (1) Consists of substandard, doubtful and loss categories.
For more information on the Company’s credit quality indicators and internal credit risk ratings, refer to Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K. 59 The following table presents the Company’s criticized loans as of December 31, 2025 and 2024: Change ($ in thousands) December 31, 2025 December 31, 2024 $ % Criticized loans: Special mention loans $ 344,876 $ 447,290 $ (102,414) (23) % Classified loans (1) 796,273 725,863 70,410 10 % Total criticized loans (2) $ 1,141,149 $ 1,173,153 $ (32,004) (3) % Special mention loans to loans held-for-investment 0.61 % 0.83 % Classified loans to loans held-for-investment 1.40 % 1.35 % Criticized loans to loans held-for-investment 2.01 % 2.18 % (1) Consists of substandard, doubtful and loss categories.
The following table presents the major financial assets held in the Company’s overseas offices as of December 31, 2024 and 2023: December 31, 2024 2023 ($ in thousands) Amount % of Total Consolidated Assets Amount % of Total Consolidated Assets Hong Kong branch: Cash and cash equivalents $ 730,227 1 % $ 631,487 1 % AFS debt securities (1) $ 752,840 1 % $ 546,495 1 % Loans held-for-investment (2) $ 968,973 1 % $ 934,734 1 % Total assets $ 2,474,447 3 % $ 2,115,857 3 % Subsidiary bank in China: Cash and cash equivalents $ 656,971 1 % $ 719,058 1 % AFS debt securities (3) $ 127,582 0 % $ 120,167 0 % Loans held-for-investment (2) $ 1,141,444 2 % $ 1,328,383 2 % Total assets $ 1,971,922 3 % $ 2,156,548 3 % (1) Comprised of U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities, U.S.
The following table presents the major financial assets held in the Company’s international branches as of December 31, 2025 and 2024: December 31, 2025 2024 ($ in thousands) Amount % of Total Consolidated Assets Amount % of Total Consolidated Assets Hong Kong branch: Cash and cash equivalents $ 860,332 1 % $ 730,227 1 % AFS debt securities (1) $ 684,513 1 % $ 752,840 1 % Loans held-for-investment (2) $ 1,133,442 1 % $ 968,973 1 % Total assets $ 2,692,309 3 % $ 2,474,447 3 % China subsidiary bank branches: Cash and cash equivalents $ 640,986 1 % $ 656,971 1 % AFS debt securities (3) $ 128,600 0 % $ 127,582 0 % Loans held-for-investment (2) $ 1,223,236 2 % $ 1,141,444 2 % Total assets $ 2,012,751 3 % $ 1,971,922 3 % (1) Comprised of U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities, U.S.
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 increase in other noninterest expense was primarily driven by higher amortization of tax credit and CRA investments. 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.
See Item 7. — MD&A — Balance Sheet Analysis — Deposits and Other Sources of Funding in this Form 10-K for further details related to the Company’s funding sources. The Company operated below its established risk limits for liquidity measures as of December 31, 2024.
See Item 7. — MD&A — Balance Sheet Analysis — Deposits in this Form 10-K for further details related to the Company’s deposits. Other Liquidity Sources.
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.
The following table presents the distribution of the Company’s AFS and HTM debt securities portfolio as of December 31, 2025 and 2024, and by credit ratings as of December 31, 2025: December 31, 2025 December 31, 2024 Rating as of December 31, 2025 (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.
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.
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 value.
However, general financial market and economic conditions could impact our access and cost of external funding. Additionally, the Company’s access to capital markets is affected by the ratings received from various credit rating agencies. Unencumbered loans and/or debt securities are pledged to the FHLB and the FRB discount window as collateral.
However, general financial market and economic conditions could impact our access and cost of external funding. Additionally, the Company’s access to capital markets is affected by the ratings received from various credit rating agencies. Sources of funding included $3.0 billion and $3.5 billion of FHLB advances as of December 31, 2025 and 2024, respectively.
The Company and the Bank are each subject to these regulatory capital adequacy requirements. See Item 1. Business — Supervision and Regulation — Regulatory Capital Requirements and Regulatory Capital-Related Development in this Form 10-K for additional details.
Business — Supervision and Regulation — Regulatory Capital Requirements and Regulatory Capital - Related Development in this Form 10-K for additional details.
Total risk-weighted assets as of December 31, 2024 increased $1.3 billion to $54.9 billion from December 31, 2023, primarily due to growth across major loan portfolios.
Total risk-weighted assets increased $2.8 billion from December 31, 2024 to $57.8 billion as of December 31, 2025, primarily due to loan growth.
The Company’s total CRE loan portfolio is well-diversified by property type with an average CRE loan size of $3 million as of both December 31, 2024 and 2023.
The Company’s underwriting parameters for CRE loans are established in compliance with supervisory guidance and include property type, geography and loan-to-value (“LTV”). 50 The Company’s total CRE loan portfolio is well-diversified by property type with an average CRE loan size of $3 million as of both December 31, 2025 and 2024.
The following table presents total uninsured deposits by location as of December 31, 2024 and 2023: ($ in thousands) Domestic China Hong Kong Total Uninsured deposits as of 12/31/2024 $ 32,767,680 $ 1,453,223 $ 1,848,652 $ 36,069,555 Uninsured deposits as of 12/31/2023 $ 27,592,714 $ 1,572,592 $ 1,487,833 $ 30,653,139 Uninsured time deposits totaled $13.5 billion as of December 31, 2024.
The following table presents total uninsured deposits by location as of December 31, 2025 and 2024: ($ in thousands) Domestic China Hong Kong Total Uninsured deposits as of 12/31/2025 $ 33,431,037 $ 1,525,527 $ 2,230,760 $ 37,187,324 Uninsured deposits as of 12/31/2024 $ 32,767,680 $ 1,453,223 $ 1,848,652 $ 36,069,555 56 Uninsured time deposits totaled $15.2 billion as of December 31, 2025.
Deposit growth during 2024 allowed the Company to grow its debt securities portfolio, which was a primary driver of the increase in unpledged available securities. 65 Cash Requirements. In the ordinary course of business, the Company enters contractual obligations that require future cash payments, including funding for customer deposit withdrawals, repayments for short- and long-term borrowings and other cash commitments.
In the ordinary course of business, the Company enters into contractual obligations that require future cash payments, including funding for customer deposit withdrawals, repayments for short- and long-term borrowings and other cash commitments.
The weighted-average LTV ratio was 46% and 48% as of December 31, 2024 and 2023, respectively. Many of these loans are reduced documentation loans, resulting in a low LTV ratio at origination, typically 65% or less. As a result, these loans have historically experienced low delinquency and loss rates.
The Company was in a first lien position for 70% and 73% of total outstanding HELOCs as of December 31, 2025 and 2024, respectively. Many of these loans are reduced documentation loans, which have a low LTV ratio at origination, typically 65% or less. The weighted-average LTV ratio was 46% as of both December 31, 2025 and 2024.
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”).
Item 1. Business — Supervision and Regulation — FDIC Deposit Insurance Assessments in this Form 10-K. Other operating expense was $165 million in 2025, an increase of $17 million or 11%, compared with 2024.
Approximately 91% of total CRE loan commitments had an LTV ratio of 65% or lower as of both December 31, 2024 and 2023. 50 The following tables provide a summary of the Company’s CRE, multifamily residential, and construction and land loans by geography as of December 31, 2024 and 2023.
The following tables provide a summary of the Company’s CRE, multifamily residential, and construction and land loans by geography as of December 31, 2025 and 2024.
The Company has established operational procedures to enable borrowing against these assets, including regular monitoring of the total pool of loans and debt securities eligible as collateral. Eligibility of collateral is defined in guidelines from the FHLB and FRB and is subject to change at their discretion.
Additionally, effective in the third quarter of 2025, the Company prepositioned unpledged debt securities as collateral for overnight repurchase agreements at the FRB SRF. The Company has established operational procedures to enable borrowing against these assets, including regular monitoring of the total pool of loans and debt securities eligible as collateral.
Construction loan exposure was made up of $506 million in loans outstanding, plus $391 million in unfunded commitments as of December 31, 2024, compared with $526 million in loans outstanding, plus $672 million in unfunded commitments as of December 31, 2023. Land loans totaled $160 million as of December 31, 2024, compared with $138 million as of December 31, 2023.
Construction loan exposure was comprised of $544 million in loans outstanding, and $419 million in unfunded commitments as of December 31, 2025, compared with $506 million in loans outstanding, and $391 million in unfunded commitments as of December 31, 2024.
Accordingly, our capital ratios as of December 31, 2024 reflect a delay of 25% of the estimated impact of CECL on regulatory capital. 58 The following table presents the Company’s and the Bank’s capital ratios as of December 31, 2024 and 2023 under the Basel III Capital Rules, and those required by regulatory agencies for capital adequacy and well-capitalized classification purposes: Basel III Capital Rules December 31, 2024 December 31, 2023 Company Bank Company Bank Minimum Regulatory Requirements Minimum Regulatory Requirements including Capital Conservation Buffer Well-Capitalized Requirements Risk-based capital ratios: CET1 capital (1) 14.3 % 13.4 % 13.3 % 12.6 % 4.5 % 7.0 % 6.5 % Tier 1 capital (2) 14.3 % 13.4 % 13.3 % 12.6 % 6.0 % 8.5 % 8.0 % Total capital 15.6 % 14.7 % 14.8 % 13.8 % 8.0 % 10.5 % 10.0 % Tier 1 leverage (1) 10.4 % 9.8 % 10.2 % 9.6 % 4.0 % 4.0 % 5.0 % (1) The CET1 capital and Tier 1 leverage well-capitalized requirements apply to the Bank only.
The following table presents the Company’s and the Bank’s capital ratios as of December 31, 2025 and 2024 under the Basel III Capital Rules, and those required by regulatory agencies for capital adequacy and well-capitalized classification purposes: Basel III Capital Rules December 31, 2025 December 31, 2024 (1) Company Bank Company Bank Minimum Regulatory Requirements Minimum Regulatory Requirements including Capital Conservation Buffer Well-Capitalized Requirements Risk-based capital ratios: CET1 capital (2) 15.1 % 13.9 % 14.3 % 13.4 % 4.5 % 7.0 % 6.5 % Tier 1 capital (3) 15.1 % 13.9 % 14.3 % 13.4 % 6.0 % 8.5 % 8.0 % Total capital 16.4 % 15.1 % 15.6 % 14.7 % 8.0 % 10.5 % 10.0 % Tier 1 leverage (2) 10.9 % 10.0 % 10.4 % 9.8 % 4.0 % 4.0 % 5.0 % (1) The Current Expected Credit Losses (“CECL”) transition provision permits certain banking organizations to exclude from regulatory capital the initial adoption impact of CECL, plus 25% of the cumulative changes in the allowance for credit losses under CECL for each period until December 31, 2021, followed by a three-year phase-out period in which the aggregate benefit is reduced by 25% in 2022, 50% in 2023 and 75% in 2024.
Substantially all of the Company’s HELOCs were variable-rate loans as of both December 31, 2024 and 2023. All originated commercial and consumer loans are subject to the Company’s conservative underwriting guidelines and loan origination standards. Management believes that the Company’s underwriting criteria and procedures adequately consider the unique risks associated with these products.
As a result, these loans have historically experienced low delinquency and loss rates. Substantially all of the Company’s HELOCs were variable-rate loans as of both December 31, 2025 and 2024. All originated commercial and consumer loans are subject to the Company’s conservative underwriting guidelines and loan origination standards.
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.
(2) For debt securities not rated by NRSROs, factors such as the priority in collections within the securitization structure, and whether contractual payments have historically been on time are considered in determining the credit risk of such securities.
The Company offers a variety of C&I products, including commercial business lending, working capital lines of credit, trade finance, letters of credit, asset-based lending, asset-backed finance, project finance and equipment financing. Additionally, the Company has a portfolio of broadly syndicated C&I loans, which represent revolving or term loan facilities that are marketed and sold primarily to institutional investors.
The Company offers a variety of C&I products, including but not limited to commercial business lending, working capital lines of credit, trade finance, letters of credit, asset-based lending, asset-backed finance, project finance and equipment financing.
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.
The decrease in other noninterest expense was primarily driven by decreased deposit insurance premiums and regulatory assessments, from lower FDIC charges. Commercial Banking The Commercial Banking segment primarily generates commercial loan and deposit products.
The ROC provides focused oversight of the Company’s identified enterprise risk categories on behalf of the full Board of Directors.
The ROC provides focused oversight of the Company’s identified enterprise risk categories on behalf of the full Board of Directors. Under the authority of the ROC, management committees apply targeted strategies to manage the risks to which the Company’s operations are exposed.
Under the authority of the ROC, management committees apply targeted strategies to manage the risks to which the Company’s operations are exposed. 59 The Company’s ERM program is executed along the three lines of defense model, which provides for a consistent and standardized risk management control environment across the enterprise.
The Company’s ERM program is executed along the three lines of defense model, which provides for a consistent and standardized risk management control environment across the enterprise. The first line of defense is comprised of revenue generating, operational and support units.
The following table presents the accruing loans past due by portfolio segment as of December 31, 2024 and 2023: Total Accruing Past Due Loans (1) Change Percentage of Total Loans Outstanding ($ in thousands) December 31, 2024 December 31, 2023 $ % December 31, 2024 December 31, 2023 Commercial: C&I $ 22,855 $ 35,649 $ (12,794) (36) % 0.13 % 0.21 % CRE: CRE 5,640 3,517 2,123 60 % 0.04 % 0.02 % Multifamily residential 931 597 334 56 % 0.02 % 0.01 % Construction and land 927 13,251 (12,324) (93) % 0.14 % 2.00 % Total CRE 7,498 17,365 (9,867) (57) % 0.04 % 0.08 % Total commercial 30,353 53,014 (22,661) (43) % 0.08 % 0.14 % Consumer: Residential mortgage: Single-family residential 54,937 45,228 9,709 21 % 0.39 % 0.34 % HELOCs 19,364 21,492 (2,128) (10) % 1.07 % 1.25 % Total residential mortgage 74,301 66,720 7,581 11 % 0.46 % 0.44 % Other consumer 107 3,265 (3,158) (97) % 0.16 % 5.41 % Total consumer 74,408 69,985 4,423 6 % 0.46 % 0.46 % Total $ 104,761 $ 122,999 $ (18,238) (15) % 0.19 % 0.24 % (1) There were no accruing loans past due 90 days or more as of both December 31, 2024 and 2023.
The following table presents the accruing loans past due by portfolio segment as of December 31, 2025 and 2024: Total Accruing Past Due Loans (1) Change Percentage of Total Loans Outstanding ($ in thousands) December 31, 2025 December 31, 2024 $ % December 31, 2025 December 31, 2024 Commercial: C&I $ 26,044 $ 22,855 $ 3,189 14 % 0.14 % 0.13 % CRE: CRE 13,994 5,640 8,354 148 % 0.09 % 0.04 % Multifamily residential 1,253 931 322 35 % 0.02 % 0.02 % Construction and land — 927 (927) (100) % 0.00 % 0.14 % Total CRE 15,247 7,498 7,749 103 % 0.07 % 0.04 % Total commercial 41,291 30,353 10,938 36 % 0.10 % 0.08 % Consumer: Residential mortgage: Single-family residential 73,684 54,937 18,747 34 % 0.49 % 0.39 % HELOCs 34,650 19,364 15,286 79 % 1.81 % 1.07 % Total residential mortgage 108,334 74,301 34,033 46 % 0.64 % 0.46 % Other consumer 77 107 (30) (28) % 0.15 % 0.16 % Total consumer 108,411 74,408 34,003 46 % 0.64 % 0.46 % Total $ 149,702 $ 104,761 $ 44,941 43 % 0.26 % 0.19 % (1) There were no accruing loans past due 90 days or more as of both December 31, 2025 and 2024.
This portfolio totaled $845 million and $645 million as of December 31, 2024 and 2023, respectively. The majority of the C&I loans had variable interest rates as of both December 31, 2024, and 2023. 49 The C&I portfolio is well-diversified by industry.
This portfolio totaled $7.6 billion and $6.0 billion as of December 31, 2025 and 2024, respectively, which primarily consisted of capital call lending and other credit facilities extended to these institutions. The majority of the C&I loans had variable interest rates as of both December 31, 2025, and 2024. The C&I portfolio is well-diversified by industry.
(2) Excludes loans held-for-sale. Criticized loans increased $195 million or 20%, to $1.2 billion from December 31, 2023, primarily driven by an increase in criticized CRE loans. Nonperforming Assets Nonperforming assets are comprised of nonaccrual loans, OREO and other nonperforming assets.
(2) Excludes loans HFS. Criticized loans decreased by $32 million or 3%, to $1.1 billion from December 31, 2024, primarily driven by decreases in C&I and multifamily residential loans, partially offset by increases in CRE and construction and land loans. Nonperforming Assets Nonperforming assets are comprised of nonaccrual loans, OREO and other nonperforming assets.
The following tables summarize the Company’s single-family residential and HELOC loan portfolios by geography as of December 31, 2024 and 2023: December 31, 2024 ($ in thousands) Single-Family Residential % HELOCs % Total Residential Mortgage % Geographic markets: Southern California $ 5,475,929 39 % $ 853,858 47 % $ 6,329,787 39 % Northern California 1,825,462 13 % 379,692 21 % 2,205,154 14 % California 7,301,391 52 % 1,233,550 68 % 8,534,941 53 % New York 4,303,815 31 % 266,529 15 % 4,570,344 29 % Washington 715,968 5 % 187,220 10 % 903,188 6 % Massachusetts 457,147 3 % 66,181 4 % 523,328 3 % Georgia 466,790 3 % 20,040 1 % 486,830 3 % Nevada 447,097 3 % 32,578 2 % 479,675 3 % Texas 468,461 3 % — — % 468,461 3 % Other markets 14,777 0 % 5,530 0 % 20,307 0 % Total $ 14,175,446 100 % $ 1,811,628 100 % $ 15,987,074 100 % Lien priority: First mortgage $ 14,175,446 100 % $ 1,322,957 73 % $ 15,498,403 97 % Junior lien mortgage — — % 488,671 27 % 488,671 3 % Total $ 14,175,446 100 % $ 1,811,628 100 % $ 15,987,074 100 % 52 December 31, 2023 ($ in thousands) Single-Family Residential % HELOCs % Total Residential Mortgage % Geographic markets: Southern California $ 4,990,848 37 % $ 799,571 46 % $ 5,790,419 38 % Northern California 1,650,905 13 % 370,989 22 % 2,021,894 13 % California 6,641,753 50 % 1,170,560 68 % 7,812,313 51 % New York 4,376,416 33 % 247,202 14 % 4,623,618 31 % Washington 696,028 5 % 184,843 11 % 880,871 6 % Massachusetts 391,666 3 % 67,016 4 % 458,682 3 % Georgia 432,258 3 % 17,123 1 % 449,381 3 % Texas 404,837 3 % 33,959 2 % 438,796 3 % Nevada 423,972 3 % — — % 423,972 3 % Other markets 16,130 0 % 1,501 0 % 17,631 0 % Total $ 13,383,060 100 % $ 1,722,204 100 % $ 15,105,264 100 % Lien priority: First mortgage $ 13,383,060 100 % $ 1,331,509 77 % $ 14,714,569 97 % Junior lien mortgage — — % 390,695 23 % 390,695 3 % Total $ 13,383,060 100 % $ 1,722,204 100 % $ 15,105,264 100 % Consumer — Single-Family Residential Loans.
The following tables summarize the Company’s single-family residential and HELOC loan portfolios by geography and lien priority as of December 31, 2025 and 2024: December 31, 2025 ($ in thousands) Single-Family Residential % HELOCs % Total Residential Mortgage % Geographic markets: Southern California $ 6,031,124 40 % $ 914,803 48 % $ 6,945,927 41 % Northern California 2,026,767 14 % 392,461 20 % 2,419,228 14 % California 8,057,891 54 % 1,307,264 68 % 9,365,155 55 % New York 4,067,708 27 % 286,995 15 % 4,354,703 26 % Washington 761,739 5 % 188,146 10 % 949,885 6 % Massachusetts 566,462 4 % 68,375 4 % 634,837 4 % Georgia 520,039 3 % 21,500 1 % 541,539 3 % Nevada 493,670 3 % 38,072 2 % 531,742 3 % Texas 513,038 4 % — — % 513,038 3 % Other markets 22,002 0 % 1,545 0 % 23,547 0 % Total $ 15,002,549 100 % $ 1,911,897 100 % $ 16,914,446 100 % Lien priority: First mortgage $ 15,002,549 100 % $ 1,337,066 70 % $ 16,339,615 97 % Junior lien mortgage — — % 574,831 30 % 574,831 3 % Total $ 15,002,549 100 % $ 1,911,897 100 % $ 16,914,446 100 % December 31, 2024 ($ in thousands) Single-Family Residential % HELOCs % Total Residential Mortgage % Geographic markets: Southern California $ 5,475,929 39 % $ 853,858 47 % $ 6,329,787 39 % Northern California 1,825,462 13 % 379,692 21 % 2,205,154 14 % California 7,301,391 52 % 1,233,550 68 % 8,534,941 53 % New York 4,303,815 31 % 266,529 15 % 4,570,344 29 % Washington 715,968 5 % 187,220 10 % 903,188 6 % Massachusetts 457,147 3 % 66,181 4 % 523,328 3 % Georgia 466,790 3 % 20,040 1 % 486,830 3 % Nevada 447,097 3 % 32,578 2 % 479,675 3 % Texas 468,461 3 % — — % 468,461 3 % Other markets 14,777 0 % 5,530 0 % 20,307 0 % Total $ 14,175,446 100 % $ 1,811,628 100 % $ 15,987,074 100 % Lien priority: First mortgage $ 14,175,446 100 % $ 1,322,957 73 % $ 15,498,403 97 % Junior lien mortgage — — % 488,671 27 % 488,671 3 % Total $ 14,175,446 100 % $ 1,811,628 100 % $ 15,987,074 100 % 53 Consumer — Single-Family Residential Loans.
The remainder were non-owner-occupied properties, where 50% or more of the debt service for the loan is typically provided by rental income from an unaffiliated third party. 51 Commercial — Multifamily Residential Loans. The multifamily residential loan portfolio is largely comprised of loans secured by residential properties with five or more units.
The Company seeks to underwrite loans with conservative standards for cash flows, debt service coverage and LTV. Owner-occupied properties comprised 20% of the CRE loans as of both December 31, 2025 and 2024. The remainder were non-owner-occupied properties, where 50% or more of the debt service for the loan is typically provided by rental income from an unaffiliated third party.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe Company does not have active net investment hedges as of December 31, 2024: December 31, 2024 Weighted Average ($ in thousands) Notional Amount Fair Value Assets (Liabilities) Fixed Rate Floating Rate (1) Remaining Term (In months) Cash flow hedges Derivative Contracts Hedging Loans: Interest rate swaps - Receive fixed pay floating $ 4,000,000 $ (27,294) 4.95 % 6.47 % 23.8 Interest rate swaps - Receive fixed pay floating - Forward Starting 1,000,000 (2,054) 3.90 % N/A (2) 67.8 Interest rate collars - Buy floor sell cap 250,000 (216) Cap: 4.58% Floor: 1.50% 4.55 % 17.0 Total cash flow hedges $ 5,250,000 $ (29,564) December 31, 2023 Weighted Average ($ in thousands) Notional Amount Fair Value Assets (Liabilities) Fixed Rate Floating Rate (1) Remaining Term (In months) Cash flow hedges Derivative Contracts Hedging Loans: Interest rate swaps - Receive fixed pay floating $ 4,000,000 $ 6,489 4.95 % 7.32 % 35.8 Interest rate swaps - Receive fixed pay floating - Forward Starting 1,000,000 32,101 3.90 % N/A (2) 79.8 Interest rate collars - Buy floor sell cap 250,000 (1,293) Cap: 4.58% Floor: 1.50% 5.34 % 29.0 Total cash flow hedges $ 5,250,000 $ 37,297 Net investment hedges Derivative Contracts Hedging Net Investment in East West Bank (China) Limited Foreign exchange forwards $ 81,480 $ 3,394 6.75 (3) 7.05 (4) 2.7 (1) Floating rates are indexed to SOFR or Prime.
Biggest changeAs of December 31, 2025, the Company anticipates performance by all of its counterparties and has not incurred any related credit losses. 70 The following tables summarize certain information on derivative instruments designated as accounting hedges and utilized by the Company in its management of interest rate risk as of December 31, 2025 and 2024: December 31, 2025 Weighted-Average ($ in thousands) Notional Amount Fair Value Assets Fair Value Liabilities Fixed Rate Floating Rate (1) Remaining Term (in months) Cash flow hedges Derivative contracts hedging loans: Interest rate swaps - Receive fixed pay floating (2) $ 4,000,000 $ 39,997 $ 139 5.66 % 5.71 % 28.6 Interest rate collars - Buy floor sell cap 250,000 — — Cap: 4.58% Floor: 1.50% 3.87 % 5.0 Total cash flow hedges $ 4,250,000 $ 39,997 $ 139 December 31, 2024 Weighted-Average ($ in thousands) Notional Amount Fair Value Assets Fair Value Liabilities Fixed Rate Floating Rate (1) Remaining Term (in months) Cash flow hedges Derivative contracts hedging loans: Interest rate swaps - Receive fixed pay floating $ 4,000,000 $ 1,808 $ 29,102 4.95 % 6.47 % 23.8 Interest rate swaps - Receive fixed pay floating - Forward starting (2) 1,000,000 3,839 5,893 3.90 % N/A 67.8 Interest rate collars - Buy floor sell cap 250,000 — 216 Cap: 4.58% Floor: 1.50% 4.55 % 17.0 Total cash flow hedges $ 5,250,000 $ 5,647 $ 35,211 (1) Floating rates are indexed to SOFR or Prime.
Item 1A. Risk Factors in this Form 10-K. 66 Market Risk Management Market risk refers to the risk of potential loss due to adverse movements in market risk factors, including interest rates, foreign exchange rates, commodity prices, and credit spreads. The Company is primarily exposed to interest rate risk through its core business activities of extending loans and acquiring deposits.
Item 1A. Risk Factors in this Form 10-K. Market Risk Management Market risk refers to the risk of potential loss due to adverse movements in market risk factors, including interest rates, foreign exchange rates, commodity prices, and credit spreads. The Company is primarily exposed to interest rate risk through its core business activities of extending loans and acquiring deposits.
The Company manages the credit risk of its derivative positions by diversifying its positions among various counterparties, by entering into legally enforceable master netting agreements, and by requiring collateral arrangements, where possible. The Company may also transfer counterparty credit risk related to interest rate swaps to third-party financial institutions through the use of credit risk participation agreements (“RPAs”).
The Company manages the credit risk of its derivative positions by diversifying its positions among various counterparties, by entering into legally enforceable master netting agreements, and by requiring collateral arrangements, where possible. The Company may also transfer counterparty credit risk related to interest rate swaps to third-party financial institutions through the use of credit risk participation agreements.
The fair value changes of the derivative contracts traded with third-party financial institutions are expected to be largely comparable to the fair value changes of the derivative transactions executed with customers throughout the terms of these contracts, except for the credit valuation adjustment component in the contracts and the spread variances between the customer derivatives and the offsetting financial counterparty positions.
The fair value changes of the derivative contracts traded with third-party financial institutions are expected to be largely comparable to the fair value changes of the derivative transactions executed with customers throughout the terms of these contracts, except for the credit valuation adjustment component of the contracts and the spread variances between the customer derivatives and the offsetting financial counterparty positions.
The following is a brief description of the Company’s critical accounting estimates involving significant judgments. Allowance for Credit Losses The Company’s allowance for credit losses represents management’s estimate of expected credit losses over the remaining expected life of the Company’s financial assets measured at amortized cost, including loans and certain lending-related commitments.
The following is a brief description of the Company’s critical accounting estimates involving significant judgments. 71 Allowance for Credit Losses The Company’s allowance for credit losses represents management’s estimate of expected credit losses over the remaining expected life of the Company’s financial assets measured at amortized cost, including loans and certain lending-related commitments.
The modeled results are highly sensitive to deposit mix and deposit beta assumptions, which are derived from a regression analysis of the Company’s historical deposit data. 67 Simulation results are highly dependent on modeled behaviors and input assumptions.
The modeled results are highly sensitive to deposit mix and deposit beta assumptions, which are derived from a regression analysis of the Company’s historical deposit data. Simulation results are highly dependent on modeled behaviors and input assumptions.
The following table presents the Company’s net interest income sensitivity related to an instantaneous and sustained parallel shift in market interest rates by 100 and 200 bps as of December 31, 2024 and 2023, on a balance sheet assuming market implied forward rates and a dynamic balance sheet with forecasted loan and deposit growth on the date of analysis.
The following table presents the Company’s net interest income sensitivity related to an instantaneous and sustained parallel shift in market interest rates by 100 and 200 bps as of December 31, 2025 and 2024, on a balance sheet assuming market implied forward rates and a dynamic balance sheet with forecasted loan and deposit growth on the date of analysis.
However, to provide additional context regarding the sensitivity of the allowance for credit losses to changes in key variables, the Company compared the quantitative modeled estimate when applying a 100% probability weighting to the downside scenario rather than the weighting of multiple scenarios used to estimate the allowance for credit losses at December 31, 2024.
However, to provide additional context regarding the sensitivity of the allowance for credit losses to changes in key variables, the Company compared the quantitative modeled estimate when applying a 100% probability weighting to the downside scenario rather than the weighting of multiple scenarios used to estimate the allowance for credit losses at December 31, 2025.
For further discussion on the economic forecast incorporated into the 2024 model, see Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K. The allowance for credit losses is sensitive to changes in macroeconomic forecast assumptions.
For further discussion on the economic forecast incorporated into the 2025 model, see Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K. The allowance for credit losses is sensitive to changes in macroeconomic forecast assumptions.
Certain derivative contracts are required to be cleared through central counterparty clearing houses, to further mitigate counterparty credit risk, where variation margin is applied daily as settlement to the fair value of the derivative contracts.
Certain derivative contracts are required to be cleared through central clearing organizations, to further mitigate counterparty credit risk, where variation margin is applied daily as settlement to the fair value of the derivative contracts.
Management believes that the estimate for the allowance for credit losses was reasonable and appropriate as of December 31, 2024. 72 Fair Value Estimates Certain financial instruments are carried at fair value on the Consolidated Balance Sheet on a recurring basis, including AFS debt securities, certain equity securities and derivatives.
Management believes that the estimate for the allowance for credit losses was reasonable and appropriate as of December 31, 2025. Fair Value Estimates Certain financial instruments are carried at fair value on the Consolidated Balance Sheet on a recurring basis, including AFS debt securities, certain equity securities and derivatives.
For additional information on these judgements and the Company’s policies and methodologies used to determine the allowance for credit losses, see Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Allowance for Loan Losses and Unfunded Credit Commitments, and Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K.
For additional information on these judgments and the Company’s policies and methodologies used to determine the allowance for credit losses, see Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Allowance for Loan and Lease Losses and Unfunded Credit Commitments, and Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K.
Without considering model overlays and qualitative adjustments which could result in a materially different estimate, this sensitivity analysis would have been approximately $483 million higher.
Without considering model overlays and qualitative adjustments which could result in a materially different estimate, this sensitivity analysis would have been approximately $423 million higher.
The Company believes that adequate provisions have been recorded for all income tax uncertainties consistent with ASC 740, Income Taxes as of December 31, 2024 .
The Company believes that adequate provisions have been recorded for all income tax uncertainties consistent with ASC 740, Income Taxes as of December 31, 2025 .
The allowance for credit losses involves significant judgment on a number of matters including development and weighting of macroeconomic forecasts, incorporation of historical loss experience, assessment of key credit risk characteristics, assignment of risk ratings, valuation of collateral, and the determination of remaining expected life.
The allowance for credit losses involves significant judgment on various matters including development and weighting of macroeconomic forecasts, incorporation of historical loss experience, assessment of key credit risk characteristics, assignment of risk ratings, valuation of collateral, and the determination of remaining expected life.
A critical judgement in the process is estimating the Company’s allowance for credit losses related to macroeconomic forecasts that are incorporated into quantitative methods.
A critical judgment in the process is estimating the Company’s allowance for credit losses related to macroeconomic forecasts that are incorporated into quantitative methods.
As any one economic outlook is inherently uncertain, the Company utilizes a baseline and upside or downside scenarios which are applied based on a probability weighting, to better reflect management’s estimate of the expected credit losses given existing market conditions and the changes in the economic environment.
As any one economic outlook is inherently uncertain, the Company utilizes a baseline as well as upside and downside scenarios that are applied based on a probability weighting, to better reflect management’s estimate of the expected credit losses given existing market conditions and the changes in the economic environment.
To economically hedge against the derivative contracts entered into with the Company’s customers, the Company enters into offsetting derivative contracts with third-party financial institutions, some of which are cleared through central counterparty clearing houses.
To economically hedge against the derivative contracts entered into with the Company’s customers, the Company enters into offsetting derivative contracts with third-party financial institutions, some of which are cleared through central clearing organizations.
Economic Value of Equity Volatility (1) December 31, 2024 2023 Change in Interest Rates (in bps) % % +200 (12.5) % (10.3) % +100 (5.2) % (5.4) % -100 4.6 % 3.0 % -200 9.5 % 6.0 % (1) The percentage change represents net present value change of the balance sheet as of the analysis date versus the various interest rate scenarios.
Economic Value of Equity Volatility (1) December 31, 2025 2024 Change in Interest Rates (in bps) % % +200 (14.1) % (12.5) % +100 (6.6) % (5.2) % -100 5.2 % 4.6 % -200 9.5 % 9.5 % (1) The percentage change represents net present value change of the balance sheet as of the analysis date versus the various interest rate scenarios.
GAAP financial measures, provide meaningful supplemental information regarding its performance, and allow comparability to prior periods. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes. 74 The following tables present the reconciliations of U.S.
The Company believes these non-GAAP financial measures, when taken together with the corresponding U.S. GAAP financial measures, provide meaningful supplemental information regarding its performance, and allow comparability to prior periods. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes. 74 The following tables present the reconciliations of U.S.
In addition, the Company’s policies permit the use of derivative instruments to assist in managing interest rate risk. We measure and monitor interest rate risk exposure through various risk management tools, which include a simulation model that performs interest rate sensitivity analyses under multiple interest rate scenarios against a baseline.
In addition, the Company’s policies permit the use of derivative instruments to assist in managing interest rate risk. 66 The Company measures and monitors interest rate risk exposure through various risk management tools, which include a simulation model that performs monthly interest rate sensitivity analyses under multiple interest rate scenarios against a baseline.
Other financial instruments, such as certain individually evaluated loans held-for-investment, loans held-for-sale, affordable housing partnership, tax credit and CRA investments, OREO and other nonperforming assets, are not carried at fair value each period but may require nonrecurring fair value adjustments primarily due to application of lower of cost or fair value accounting or write-downs of individual assets.
Other financial instruments, such as certain individually evaluated loans held-for-investment, loans held-for-sale, affordable housing partnership, tax credit and CRA investments, OREO and other nonperforming assets, are not carried at fair value each period but may require nonrecurring fair value adjustments primarily due to application of lower of cost or fair value accounting or write-downs of individual assets. 72 In determining the fair value of financial instruments, the Company uses market prices of the same or similar instruments whenever such prices are available.
The Company also utilizes foreign exchange contracts that are not designated as hedging instruments to mitigate the economic effect of fluctuations in certain foreign currency on-balance sheet assets and liabilities, primarily foreign currency denominated deposits offered to its customers. 70 The Company is subject to credit risk associated with the counterparties to derivative contracts.
The Company also utilizes foreign exchange contracts that are not designated as hedging instruments to mitigate the economic effect of fluctuations in certain foreign currency on-balance sheet assets and liabilities and to meet funding needs in certain foreign currencies. The Company is subject to credit risk associated with the counterparties to the derivative contracts.
For the year ended December 31, 2024, the Company assumed a weighted-average beta of 55% for total deposits, an increase of approximately 4% from December 31, 2023. This increase was primarily due to deposit beta assumption updates and deposit product mix changes.
For the year ended December 31, 2025, the Company assumed a weighted-average beta of 56% for total deposits, an increase of approximately 1% from December 31, 2024. This increase was primarily due to deposit product mix changes.
In evaluating whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company assesses relevant events and circumstances such as macroeconomic conditions, industry and market considerations, financial performance, the Company’s stock price and other relevant entity- and reporting-unit specific considerations.
In evaluating whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company assesses relevant events and circumstances such as macroeconomic conditions, industry and market considerations, financial performance, the Company’s stock price and other relevant entity- and reporting-unit specific considerations. 73 Income Taxes The Company files income tax returns in the jurisdictions in which it conducts business and evaluates income tax expense in two components: current and deferred income tax expense.
Net Interest Income Volatility (1) December 31, 2024 2023 Change in Interest Rates (in bps) % % +200 4.7 % 4.6 % +100 3.5 % 2.7 % -100 (4.0) % (3.3) % -200 (7.4) % (6.7) % (1) The percentage change represents net interest income change over a 12-month period under market forward rates and expected balance sheet growth as of the analysis date versus various interest rate scenarios. 68 The composition of the Company’s loan portfolio creates sensitivity to interest rate movements due to a mismatch of repricing behavior between the floating-rate loan portfolio and deposit products.
Net Interest Income Volatility (1) December 31, 2025 2024 Change in Interest Rates (in bps) % % +200 5.6 % 4.7 % +100 3.2 % 3.5 % -100 (3.2) % (4.0) % -200 (5.9) % (7.4) % (1) The percentage change represents net interest income change over a 12-month period under market forward rates and expected balance sheet growth as of the analysis date versus various interest rate scenarios.
Goodwill Impairment The valuation and testing methodologies used in the Company’s analysis of goodwill impairment are discussed in Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Goodwill, Note 8 — Goodwill, and Note 17 — Business Segments to the Consolidated Financial Statements in this Form 10-K . 73 The Company performed its annual goodwill impairment test on all three reporting units using a qualitative assessment.
Goodwill Impairment The valuation and testing methodologies used in the Company’s analysis of goodwill impairment are discussed in Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Goodwill, Note 8 — Goodwill, and Note 17 — Business Segments to the Consolidated Financial Statements in this Form 10-K .
(4) Represents the weighted average market foreign exchange rate between CNY and USD as of December 31, 2023. 71 Additional information on the Company’s derivatives is presented in Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Derivatives, Note 2 — Fair Value Measurement and Fair Value of Financial Instruments, and Note 5 — Derivatives to the Consolidated Financial Statements in this Form 10-K.
Additional information on the Company’s derivatives is presented in Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Derivatives, Note 2 — Fair Value Measurement and Fair Value of Financial Instruments, and Note 5 — Derivatives to the Consolidated Financial Statements in this Form 10-K.
These third-party vendor models have access to more comprehensive industry-level data that captures specific borrower and collateral characteristics over a variety of interest rate cycles. The Company will periodically assess and adjust the vendor models when appropriate to include its own available observations and expectations.
These third-party vendor models have access to more comprehensive industry-level data that captures specific borrower and collateral characteristics over a variety of interest rate cycles.
As of December 31, 2024, the Company’s EVE is expected to decrease when interest rates rise. The EVE sensitivity represents a duration mismatch between fixed-rate assets versus fixed-rate liabilities where more fixed- rate assets are expected to produce more stable net interest income in the short term but may lead to decreases in net present value of future cash flows.
The EVE sensitivity represents a duration mismatch between fixed-rate assets versus fixed-rate liabilities where more fixed- rate assets are expected to produce more stable net interest income in the short term but may lead to decreases in net present value of future cash flows. 69 Derivatives It is the Company’s policy not to speculate on the future direction of interest rates, foreign currency exchange rates and commodity prices.
In addition, the Company incorporates credit valuation adjustments and other market standard methodologies to appropriately reflect the counterparty’s and the Company’s own nonperformance risk in the fair value measurement of its derivatives. As of December 31, 2024, the Company anticipates performance by all its counterparties and has not incurred any related credit losses.
In addition, the Company incorporates credit valuation adjustments and other market standard methodologies to appropriately reflect the counterparty’s and the Company’s own nonperformance risk in the fair value measurement of its derivatives.
The Company uses the results of these simulations to formulate and gauge strategies to achieve a desired risk profile within its capital and liquidity guidelines. In the third quarter of 2024, the Company transitioned its net interest income volatility simulations from a static to a dynamic balance sheet approach and adopted market forward rates instead of flat forward rates.
The Company uses the results of these simulations to formulate and gauge strategies to achieve a desired risk profile within its capital and liquidity guidelines. The Company’s net interest income volatility simulations are based on a dynamic balance sheet approach and market forward rates to better reflect the interest rate risk on the Company’s financial statements.
December 31, 2024 2023 ($ in thousands) Total Balance (1) Level 3 Total Balance (1) Level 3 Total assets measured at fair value on a recurring basis $ 11,395,533 $ 239 $ 6,823,916 $ 336 Total assets measured at fair value on a nonrecurring basis 85,872 85,872 46,760 46,760 Total assets measured at fair value (a) $ 11,481,405 (b) $ 86,111 (d) $ 6,870,676 (f) $ 47,096 Total assets (c) $ 75,976,475 (e) $ 69,612,884 Level 3 assets at fair value as a percentage of total assets (b)/(c) 0.11 % (f)/(e) 0.07 % Level 3 assets at fair value as a percentage of total assets at fair value (b)/(a) 0.75 % (f)/(d) 0.69 % (1) Before derivative netting adjustments.
December 31, 2025 2024 ($ in thousands) Total Balance (1) Level 3 Total Balance (1) Level 3 Total assets measured at fair value on a recurring basis $ 13,648,713 $ 522 $ 11,395,533 $ 239 Total assets measured at fair value on a nonrecurring basis 33,239 33,239 85,872 85,872 Total assets measured at fair value (a) $ 13,681,952 (b) $ 33,761 (d) $ 11,481,405 (f) $ 86,111 Total assets (c) $ 80,434,997 (e) $ 75,976,475 Level 3 assets at fair value as a percentage of total assets (b)/(c) 0.04 % (f)/(e) 0.11 % Level 3 assets at fair value as a percentage of total assets at fair value (b)/(a) 0.25 % (f)/(d) 0.75 % (1) Before derivative netting adjustments.
Twelve-Month Net Interest Income Simulation Net interest income simulation modeling measures interest rate risk through earnings volatility. The simulation projects the cash flow changes in interest rate sensitive assets and liabilities, expressed in terms of net interest income, over a specified time horizon for defined interest rate scenarios.
The simulation projects the cash flow changes in interest rate sensitive assets and liabilities, expressed in terms of net interest income, over a specified time horizon for defined interest rate scenarios. Net interest income simulations provide insight into the impact of market rate changes on earnings, which help guide risk management decisions.
The qualitative test indicated that it was more likely than not that the fair values of all the Company’s reporting units exceeded their carrying values. The Company concluded that the goodwill allocated to its reporting units was not impaired as of December 31, 2024.
The Company performed its annual goodwill impairment test on all three reporting units using a qualitative assessment. The qualitative test indicated that it was more likely than not that the fair values of all the Company’s reporting units exceeded their carrying values.
The non-GAAP financial measures discussed in this Form 10-K are return on average TCE and tangible book value per share. Certain additional non-GAAP financial measures that are components of the foregoing non-GAAP financial measures are also set forth and reconciled in the table below. The Company believes these non-GAAP financial measures, when taken together with the corresponding U.S.
The non-GAAP financial measures discussed in this Form 10-K include but are not limited to ROATCE, tangible book value per share, and adjusted loan yield. Certain additional non-GAAP financial measures that are components of the foregoing non-GAAP financial measures are also set forth and reconciled in the table below.
Foreign exchange derivatives are used in net investment hedging strategies to mitigate the risk of changes in the U.S. dollar (“USD”) equivalent value of a designated monetary amount of the Company’s net investment in East West Bank (China) Limited.
Foreign exchange derivatives are used in net investment hedging strategies to mitigate the risk of changes in the U.S. dollar equivalent value of a designated monetary amount of the Company’s net investment in EWCN. Prior to entering any hedge accounting activity, the Company analyzes the costs and benefits of the hedge in comparison to alternative strategies.
This change better reflects the interest rate risk on the Company’s financial statements. Furthermore, the Company standardized its simulation scenarios by shifting from non-parallel to parallel shocks for both instantaneous and gradual net interest income simulations, as well as for economic value of equity (“EVE”) simulations. This alignment with industry-standard scenario definitions is intended to enhance interpretability and comparability.
The Company’s simulation scenarios use parallel shocks for both instantaneous and gradual net interest income simulations, as well as economic value of equity (“EVE”) simulations. These simulations conform with industry-standard scenario definitions and enhance interpretability and comparability.
Net interest income simulations provide insight into the impact of market rate changes on earnings, which help guide risk management decisions. The Company assesses interest rate risk by comparing the changes of net interest income in different interest rate scenarios.
The Company assesses interest rate risk by comparing the changes of net interest income in different interest rate scenarios.
In determining the fair value of financial instruments, the Company uses market prices of the same or similar instruments whenever such prices are available. Changes in market conditions, such as reduced liquidity in the capital markets or changes in secondary market activities, may increase variability or reduce the availability of market prices used to determine fair value.
Changes in market conditions, such as reduced liquidity in the capital markets or changes in secondary market activities, may increase variability or reduce the availability of market prices used to determine fair value. If observable market prices are unavailable or impracticable to obtain, then fair value is estimated using modeling techniques such as discounted cash flows analysis.
If observable market prices are unavailable or impracticable to obtain, then fair value is estimated using modeling techniques such as discounted cash flows analysis. These modeling techniques incorporate management’s assessments regarding the assumptions that market participants would use in pricing the asset or the liability, including the risks inherent in a particular valuation technique and the risk of nonperformance.
These modeling techniques incorporate management’s assessments regarding the assumptions that market participants would use in pricing the asset or the liability, including the risks inherent in a particular valuation technique and the risk of nonperformance. The use of methodologies or assumptions different than those used by the Company could result in different estimates of fair value of financial instruments.
Given the uncertainty of the magnitude, timing and direction of future interest rate movements, the shape of the yield curve, and potential changes to the balance sheet, actual results may vary from those predicted by the Company’s model. 69 The following table presents the Company’s EVE sensitivity related to an instantaneous parallel shift in market interest rates by 100 and 200 bps as of December 31, 2024 and 2023.
The following table presents the Company’s EVE sensitivity related to an instantaneous parallel shift in market interest rates by 100 and 200 bps as of December 31, 2025 and 2024.
The use of methodologies or assumptions different than those used by the Company could result in different estimates of fair value of financial instruments. Significant judgment is also required to determine the fair value hierarchy for certain financial instruments.
Significant judgment is also required to determine the fair value hierarchy for certain financial instruments.
GAAP to non-GAAP financial measures for 2024 and 2023 : Year Ended December 31, ($ in thousands) 2024 2023 Net income (a) $ 1,165,586 $ 1,161,161 Add: Amortization of core deposit intangibles — 1,763 Amortization of mortgage servicing assets 1,322 1,328 Tax effect of amortization adjustments (1) (393) (914) Tangible net income (non-GAAP) (b) $ 1,166,515 $ 1,163,338 Average stockholders’ equity (c) $ 7,315,174 $ 6,482,985 Less: Average goodwill (465,697) (465,697) Average other intangible assets (2) (5,953) (6,542) Average tangible book value (non-GAAP) (d) $ 6,843,524 $ 6,010,746 ROE (a)/(c) 15.93 % 17.91 % Return on average TCE (non-GAAP) (b)/(d) 17.05 % 19.35 % December 31, ($ and shares in thousands, except per share data) 2024 2023 Stockholders’ equity (a) $ 7,723,054 $ 6,950,834 Less: Goodwill (465,697) (465,697) Other intangible assets (2) (5,234) (6,602) Tangible book value (non-GAAP) (b) $ 7,252,123 $ 6,478,535 Number of common shares at period-end (c) 138,437 140,027 Book value per share (a)/(c) $ 55.79 $ 49.64 Tangible book value per share (non-GAAP) (b)/(c) $ 52.39 $ 46.27 (1) Applied statutory rate of 29.73% for 2024 and 29.56% for 2023.
GAAP to non-GAAP financial measures for 2025 and 2024: Year Ended December 31, ($ in thousands) 2025 2024 Net income (a) $ 1,325,188 $ 1,165,586 Add: Amortization of mortgage servicing assets 1,124 1,322 Tax effect of amortization adjustments (1) (315) (393) Tangible net income (non-GAAP) (b) $ 1,325,997 $ 1,166,515 Average stockholders’ equity (c) $ 8,276,408 $ 7,315,174 Less: Average goodwill (465,697) (465,697) Average mortgage servicing assets (4,684) (5,953) Average tangible book value (non-GAAP) (d) $ 7,806,027 $ 6,843,524 ROAE (a)/(c) 16.01 % 15.93 % ROATCE (non-GAAP) (b)/(d) 16.99 % 17.05 % December 31, ($ and shares in thousands, except per share data) 2025 2024 Stockholders’ equity (a) $ 8,899,202 $ 7,723,054 Less: Goodwill (465,697) (465,697) Mortgage servicing assets (4,119) (5,234) Tangible book value (non-GAAP) (b) $ 8,429,386 $ 7,252,123 Number of common shares at period-end (c) 137,579 138,437 Book value per share (a)/(c) $ 64.68 $ 55.79 Tangible book value per share (non-GAAP) (b)/(c) $ 61.27 $ 52.39 Year Ended December 31, 2025 2024 Average loan yield Interest income on loans (d) $ 3,494,661 $ 3,490,979 Less: Loan payoff discount accretion and interest recoveries (32,296) — Adjusted interest income on loans (e) $ 3,462,365 $ 3,490,979 Average loans (f) $ 54,624,959 $ 52,368,780 Average loan yield (d)/(f) 6.40 % 6.67 % Adjusted average loan yield (e)/(f) 6.34 % 6.67 % (1) Applied blended statutory rate of 28.02% for 2025 and 29.73% for 2024.
Net Interest Income Volatility December 31, 2024 2023 Change in Interest Rates (in bps) % % +200 Rate ramp 4.3 % 4.0 % +100 Rate ramp 2.3 % 2.0 % -100 Rate ramp (2.4) % (1.7) % -200 Rate ramp (4.6) % (3.8) % As of December 31, 2024, the Company’s net interest income profile reflects an asset sensitive position, where assets reprice faster or more significantly than liabilities.
Net Interest Income Volatility December 31, 2025 2024 Change in Interest Rates (in bps) % % +200 Rate ramp 3.4 % 4.3 % +100 Rate ramp 1.7 % 2.3 % -100 Rate ramp (1.5) % (2.4) % -200 Rate ramp (3.0) % (4.6) % As of December 31, 2025, the Company’s net interest income profile remains asset-sensitive under both instantaneous parallel and gradual shifts in interest rates, with a higher proportion of interest-earning assets repricing in the near term, compared to interest-bearing liabilities.
The Company believes these derivative transactions, when properly structured and managed, provide a hedge against inherent risk in certain assets and liabilities or against risk in specific transactions. Hedging transactions may be implemented using a variety of derivative instruments such as swaps, forwards, options and collars.
Hedging transactions may be implemented using a variety of derivative instruments such as swaps, forwards, options and collars. The Company uses interest rate contracts to hedge the variability in interest received on certain floating-rate commercial loans.
However, the difference in time horizons can cause the EVE analysis to diverge from the shorter-term net interest income analysis presented above.
However, the difference in time horizons can cause the EVE analysis to diverge from the shorter-term net interest income analysis presented above. Given the uncertainty of the magnitude, timing and direction of future interest rate movements, the shape of the yield curve, and potential changes to the balance sheet, actual results may vary from those predicted by the Company’s model.
A majority of the Company’s deposit portfolio is composed of non-maturity deposits, which are not directly tied to short-term interest rate indices, but are, nevertheless, sensitive to changes in short-term interest rates. The modeled results are highly sensitive to modeled behavior and assumptions.
A portion of the Company’s interest-bearing deposit portfolio consists of non-maturity deposits that are not directly indexed to short-term rates but remain sensitive to rate changes. The Company actively manages deposit pricing and employs quantitative models to evaluate and forecast deposit behavior under various interest rate scenarios.
Derivatives It is the Company’s policy not to speculate on the future direction of interest rates, foreign currency exchange rates and commodity prices. However, the Company periodically enters into derivative transactions in order to manage its exposure to market risk, primarily interest rate risk and foreign currency risk.
However, the Company periodically enters into derivative transactions in order to manage its exposure to market risk, primarily interest rate risk and foreign currency risk. The Company believes these derivative transactions, when properly structured and managed, provide a hedge against inherent risk in certain assets and liabilities or against risk in specific transactions.
In the table above, the net interest income volatility expressed in relation to base-case net interest income increased in both rising and decreasing rate scenarios as of December 31, 2024. This change reflects deposit product mix assumptions, which assume noninterest-bearing deposits decrease in higher interest rate environments and are replaced with term deposit products.
In the table above, the net interest income volatility expressed in relation to base-case net interest income decreased under the falling rate scenarios as of December 31, 2025, reflecting updated assumptions on deposit mix and a shift in balance sheet composition toward a higher proportion of fixed-rate assets.
Net interest income is expected to increase when interest rates rise as the Company has a large population of variable rate loans, primarily tied to Prime and Term Secured Overnight Financing Rate (“ SOFR”) indices. The Company’s interest income is sensitive to changes in short-term interest rates.
This position is primarily driven by a significant volume of variable-rate loans indexed to Prime and Term Secured Overnight Financing Rate (“SOFR”). A declining rate environment could negatively impact the net interest income.
Removed
As of December 31, 2024 , the Company designated interest rate contracts with a notional amount of $5.3 billion as cash flow hedges, which reduced net interest income volatility by approximately 1.30% of the base net interest income for every 100 bp change in interest rate .
Added
The Company will periodically assess and adjust the vendor models when appropriate to include its own available observations and expectations. 67 Twelve-Month Net Interest Income Simulation Net interest income simulation modeling measures interest rate risk through earnings volatility.
Removed
Actual net interest income results may deviate from the model’s net interest income due to earning asset growth variation and deposit mix changes based on customer preferences relative to the interest rate environment. During a period of declining interest rates, balance sheet growth could offset headwinds to net interest income from yield compression.
Added
The composition of the Company’s loan portfolio creates sensitivity to interest rate movements due to a mismatch of repricing behavior between the floating-rate loan portfolio and deposit products.
Removed
The Company uses interest rate swaps to hedge the variability in interest received on certain floating-rate commercial loans and interest paid on certain floating-rate borrowings.
Added
However, this potential impact could be partially mitigated by several structural factors, including balance sheet growth and mix evolution, ongoing reinvestment of cash flows into assets at rates above legacy lower yielding instruments, and prevailing yield‑curve conditions. 68 To reduce volatility, the Company has designated $4.3 billion in notional value of interest rate contracts as cash flow hedges, which are estimated to mitigate net interest income variability by approximately 1.27% of base net interest income for every 100 basis point change in interest rates.
Removed
Prior to entering any accounting hedge activity, the Company analyzes the costs and benefits of the hedge in comparison to alternative strategies.
Added
Actual results may differ from modeled projections due to variations in earning asset growth and changes in deposit composition driven by customer preferences. Modeled outcomes are highly dependent on behavioral assumptions, including deposit mix shifts and customer rate sensitivity.
Removed
The following table summarizes certain information on derivative instruments designated as accounting hedges and utilized by the Company in its management of interest rate and foreign currency risks as of December 31, 2024 and 2023.
Added
As of December 31, 2025, the Company’s EVE is expected to decrease when interest rates rise.
Removed
(2) The swaps are forward starting and not effective as of both December 31, 2024 and 2023. (3) Represents the weighted average strike foreign exchange rate between Chinese Yuan (“CNY”) and USD.
Added
(2) Forward starting swaps with a total notional value of $1 billion became effective during 2025.
Removed
Income Taxes The Company files income tax returns in the jurisdictions in which it conducts business and evaluates income tax expense in two components: current and deferred income tax expense.
Added
The Company concluded that the goodwill allocated to its reporting units was not impaired as of December 31, 2025.
Removed
(2) Includes core deposit intangibles and mortgage servicing assets. There were no core deposit intangibles in 2024.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

7 edited+0 added−1 removed12 unchanged
Biggest changeIn addition, the Information Security Team works in coordination with the individual business lines that have direct and primary responsibility and accountability for identifying, controlling and monitoring cybersecurity risk embedded in their business activities. The Information Security Team uses reputable industry service providers for security operations, monitoring, investigation and incident response.
Biggest changeIn addition, the Information Security Team works in coordination with the individual business lines that have direct and primary responsibility and accountability for identifying, controlling and monitoring cybersecurity risk embedded in their business activities. 30 The Information Security Team uses industry service providers for security operations, monitoring, investigation and incident response, and the Bank also conducts periodic assessments in collaboration with consulting firms with cybersecurity domain expertise.
When applicable, the Company obtains Statement on Standards for Attestation Engagement 18 reports or equivalent reports for vendor products and services hosted by third parties. Internal Audit serves as the third line of defense and provides additional independent assurance and evaluates the effectiveness of cybersecurity risk management.
When applicable, the Company obtains Statement on Standards for Attestation Engagement No. 18 reports or equivalent reports for vendor products and services hosted by third parties. Internal Audit serves as the third line of defense and provides additional independent assurance and evaluates the effectiveness of cybersecurity risk management.
However, we can provide no assurance that all of our security measures will be effective. For additional information regarding cybersecurity threats, please refer to Item 1, Business – Supervision and Regulation – Privacy and Cybersecurity and Item 1A, Risk Factors – Risks Related to Our Operations .
However, we can provide no assurance that all of our security measures will be effective. For additional information regarding cybersecurity threats, please refer to Item 1, Business – Supervision and Regulation – Privacy and Cybersecurity and Item 1A, Risk Factors – Risks Related to Our Operations . 31
The majority of Information Security Team members have over 10 years of cybersecurity experience and cumulatively hold over 50 active professional certifications in related fields. 31 Material Cybersecurity Threat Risk To date, the Company has not experienced any known cybersecurity incidents that have materially affected its business strategy, results of operations or financial condition.
The majority of Information Security Team members have over 10 years of cybersecurity experience and cumulatively hold over 80 active professional certifications in related fields. Material Cybersecurity Threat Risk To date, the Company has not experienced any known cybersecurity incidents that have materially affected its business strategy, results of operations or financial condition.
ITEM 1C. CYBERSECURITY Risk Management and Strategy The Company maintains an Information Security Program to support the management of cybersecurity risk as an integral component of the Company’s ERM framework. The Information Security Program encompasses the Company’s cybersecurity policies and practices, which focus on prevention, detection, mitigation and recovery from cybersecurity incidents.
ITEM 1C. CYBERSECURITY Risk Management and Strategy The Company maintains an Information Security Program to support the management of cybersecurity risk as an integral component of the Company’s enterprise risk management (“ERM”) framework. The Information Security Program encompasses the Company’s cybersecurity policies and practices, which focus on prevention, detection, mitigation and recovery from cybersecurity incidents.
The Chief Risk Officer has held various leadership roles at the bank, including over 13 years previously serving as the Company’s Chief Financial Officer. The Chief Information Security Officer has over 20 years of work experience in cybersecurity at financial institutions.
The Chief Risk Officer has held various leadership roles at the bank, including over 13 years previously serving as the Company’s Chief Financial Officer. The Chief Information Security Officer has over 25 years of work experience in technology and cybersecurity at financial institutions.
The Information Security Program follows a National Institute of Standards and Technology based Cybersecurity Framework and other applicable industry standards. 30 The Information Security Program is supported by our three lines of defense model of risk management.
The Information Security Program follows the Cyber Risk Institute Profile, which is a framework aligned with regulatory expectations for managing cyber risk in financial institutions. The Information Security Program is supported by our three lines of defense model of risk management.
Removed
The Information Risk Management team conducts periodic assessments in collaboration with consulting services with expertise in the cybersecurity domains.

Item 2. Properties

Properties — owned and leased real estate

3 edited+0 added−2 removed0 unchanged
Biggest changeThe Company believes that its facilities are adequate and suitable for its business needs. It evaluates its current and projected space needs and may determine that certain premises or facilities are no longer necessary for its operations. The Company believes that, if necessary, it could secure alternative properties on similar terms without adversely affecting its operations. ITEM 3.
Biggest changeAll properties occupied by the Bank are available to be used across all business segments and for corporate purposes. The Company believes that its facilities are adequate and suitable for its business needs. It evaluates its current and projected space needs and may determine that certain premises or facilities are no longer necessary for its operations.
ITEM 2. PROPERTIES East West’s corporate headquarters is located at 135 North Los Robles Avenue, Pasadena, California, an eight-story office building, of which it owns 50%. The Company operates in 21 owned and 86 leased locations in the U.S., as well as 11 leased locations in Asia.
ITEM 2. PROPERTIES East West’s corporate headquarters is located at 135 North Los Robles Avenue, Pasadena, California, an eight-story office building, of which it owns 50%. The Company operates in 20 owned and over 90 leased locations in the U.S. and Asia. In the U.S., the Bank’s main operations and administrative offices are located in Southern California.
LEGAL PROCEEDINGS See Note 12 — Commitments and Contingencies — Litigation to the Consolidated Financial Statements in this Form 10-K, which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 32 PART II
The Company believes that, if necessary, it could secure alternative properties on similar terms without adversely affecting its operations. ITEM 3. LEGAL PROCEEDINGS See Note 12 — Commitments and Contingencies — Litigation to the Consolidated Financial Statements in this Form 10-K, which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 32 PART II
Removed
In the U.S., the Bank’s corporate headquarters and main administrative offices are located in California, and its branches and offices are located in California, Texas, New York, Washington, Georgia, Massachusetts, Illinois and Nevada.
Removed
In Asia, East West’s presence includes full service branches in Hong Kong, Shanghai, Shantou and Shenzhen, representative offices in Beijing, Chongqing, Guangzhou, Xiamen, and Singapore, and administrative support offices in Beijing and Shanghai. All properties occupied by the Bank are used across all business segments and for corporate purposes.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

1 edited+0 added−0 removed3 unchanged
Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information, Holders of Common Stock and Dividends The Company’s common stock is traded on the Nasdaq Global Select Market under the symbol “EWBC”. As of January 31, 2025, the Company had 675 stockholders of record of the Company’s common stock.
Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information, Holders of Common Stock and Dividends The Company’s common stock is traded on the Nasdaq Global Select Market under the symbol “EWBC”. As of January 31, 2026, the Company had 652 stockholders of record of the Company’s common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

101 edited+35 added−59 removed148 unchanged
Biggest changeThe Company expects the Trump administration will seek to implement a regulatory reform agenda that is significantly different than that of the Biden administration, which will impact the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies, even if those agencies are not directly subject to the executive memo. 16 Future Legislation, Regulation and Supervision Activities New statutes, regulations and policies that contain wide-ranging proposals for altering the structures, regulations and competitive relationships of financial institutions and public companies operating in the U.S. are regularly adopted.
Biggest changeFuture Legislation, Regulation and Supervision Activities New statutes, regulations and policies that contain wide-ranging proposals for altering the structures, regulations and competitive relationships of financial institutions and public companies are regularly adopted.
Our business and many of our customers may have experienced, and may experience again in the future, losses incurred due to fraud or theft related to customers, employees or third parties. These losses may negatively affect our business, results of operations, financial condition, reputation or prospects.
Our business and many of our customers may have experienced, and may experience again in the future, losses incurred due to fraud or theft related to customers, employees or third parties. These losses may negatively affect our business, results of operations, financial condition, reputation and prospects.
Although both the Board of Directors and management monitor our succession planning for our senior management team, the loss of key personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on our business, financial condition, or operating results.
Although both the Board of Directors and management monitor our succession planning for our senior management team, the loss of key personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on our business, financial condition, and operating results.
The Financial Crimes Enforcement Network may impose significant civil monetary penalties for violations of those requirements and has been engaging in coordinated enforcement efforts with the federal and state banking regulators, as well as the DOJ, Drug Enforcement Administration, and the Internal Revenue Service. 27 We are also required to comply with the U.S. economic and trade sanctions administered by the OFAC regarding, among other things, the prohibition of transacting business with, and the need to freeze assets of, certain persons and organizations identified as a threat to the national security, foreign policy, or economy of the U.S.
The Financial Crimes Enforcement Network may impose significant civil monetary penalties for violations of those requirements and has been engaging in coordinated enforcement efforts with the federal and state banking regulators, as well as the DOJ, Drug Enforcement Administration, and the Internal Revenue Service. 27 We are also required to comply with the U.S. economic and trade sanctions administered by the OFAC regarding, among other things, the prohibition of transacting business with, and the need to freeze assets of, certain persons and organizations identified as a threat to the national security, foreign policy, or the U.S. economy.
Federal Reserve policies may also adversely affect borrowers, potentially increasing the risk that they may fail to repay their loans, or could adversely create asset bubbles resulting from prolonged periods of accommodative policy. This, in turn, may result in volatile markets and rapidly declining collateral values. Changes in Federal Reserve policies are beyond our control.
Federal Reserve policies may also adversely affect borrowers, potentially increasing the risk that they may fail to repay their loans, or could adversely create asset bubbles resulting from prolonged periods of accommodative policy. This, in turn, may result in volatile markets and rapidly declining collateral values. Changes in Federal Reserve personnel and policies are beyond our control.
Additional country or region-specific risks are associated with transactions outside the U.S., including in China. To the extent we issue capital stock in connection with acquisition transactions, these transactions and related stock issuances may have a dilutive effect on our earnings per share (“EPS”) and share ownership. New products and services may subject us to additional risks.
Additional country or region-specific risks are associated with transactions outside the U.S., including in China. To the extent we issue capital stock in connection with acquisition transactions, these transactions and related stock issuances may have a dilutive effect on our earnings per share (“EPS”) and share ownership. 25 New products and services may subject us to additional risks.
Fluctuations in foreign currency exchange rates could have a material unfavorable impact on our net income, therefore adversely affecting our business, results of operations, and financial condition. Risks Related to Our Capital Resources and Liquidity As a regulated entity, we are subject to capital requirements, and a failure to meet these standards could adversely affect our financial condition.
Fluctuations in foreign currency exchange rates could have a material unfavorable impact on our net income, therefore adversely affecting our business, results of operations, and financial condition. 20 Risks Related to Our Capital Resources and Liquidity As a regulated entity, we are subject to capital requirements, and failure to meet these standards could adversely affect our financial condition.
Federal Reserve approval is also required for a bank holding company to acquire more than 5% of our outstanding common stock. These and other provisions could make it more difficult for a third party to acquire us, even if an acquisition might be in the best interest of the stockholders.
Federal Reserve approval is also generally required for a bank holding company to acquire more than 5% of our outstanding common stock. These and other provisions could make it more difficult for a third party to acquire us, even if an acquisition might be in the best interest of the stockholders.
Failure to attract and retain banking customers may adversely impact our loan and deposit growth and in turn, our revenues. 25 We have engaged in and may continue to engage in further expansion through acquisitions, which could cause disruption to our business and may dilute existing stockholders’ interests. There are risks associated with expanding through mergers and acquisitions.
Failure to attract and retain banking customers may adversely impact our loan and deposit growth and in turn, our revenues. We have engaged in and may continue to engage in further expansion through acquisitions, which could cause disruption to our business and may dilute existing stockholders’ interests. There are risks associated with expanding through mergers and acquisitions.
The information contained on the Company’s website as referenced in this report is not part of this report. Stockholders may also request a copy free of charge of any of the above-referenced reports and corporate governance documents by writing to: Investor Relations, East West Bancorp, Inc., 135 N.
The information contained on the Company’s website as referenced in this report is not part of this report. 15 Stockholders may also request a copy free of charge of any of the above-referenced reports and corporate governance documents by writing to: Investor Relations, East West Bancorp, Inc., 135 N.
However, we can provide no assurance that all of our security measures will be effective. 23 Third parties that facilitate our business activities could also be sources of operational and security risks to us. Our ability to implement backup systems or other safeguards with respect to third-party systems is limited.
However, we can provide no assurance that all of our security measures will be effective. Third parties that facilitate our business activities could also be sources of operational and security risks to us. Our ability to implement backup systems or other safeguards with respect to third-party systems is limited.
In addition, a bank generally may not extend credit to an affiliate unless the extension of credit is secured by specified amounts of collateral. The Dodd-Frank Act expanded the coverage and scope of the limitations on affiliate transactions, including by treating derivative transactions resulting in a bank’s credit exposure to an affiliate as covered transactions.
In addition, a bank generally may not extend credit to an affiliate unless the extension of credit is secured by specified amounts of collateral. The Dodd-Frank Act expanded the coverage and scope of the limitations on affiliate transactions by treating derivative transactions resulting in a bank’s credit exposure to an affiliate as covered transactions.
Accordingly, changes in levels of interest rates could materially and adversely affect our net interest income, net interest margin, cost of deposits, loan origination volume, average loan portfolio balance, asset quality, liquidity, and overall profitability. Inflation can have an adverse impact on our business and on our customers.
Accordingly, changes in levels of interest rates could materially and adversely affect our net interest income, net interest margin, cost of deposits, loan origination volume, average loan portfolio balance, asset quality, liquidity, and overall profitability. 19 Inflation can have an adverse impact on our business and on our customers.
Under these circumstances, we may be required to access additional funding from other sources in order to manage our liquidity risk. 22 Risks Related to Credit Matters Our allowance for credit losses may not be adequate to cover actual losses. We establish an allowance for credit losses in accordance with U.S.
Under these circumstances, we may be required to access additional funding from other sources in order to manage our liquidity risk. Risks Related to Credit Matters Our allowance for credit losses may not be adequate to cover actual losses. We establish an allowance for credit losses in accordance with U.S.
Additionally, prior approval of the Federal Reserve and the DFPI is required for any person to acquire control of us, and control for these purposes may be presumed to exist when a person owns 10% or more of our outstanding common stock.
Additionally, prior approval of the Federal Reserve and the DFPI is generally required for any person to acquire control of us, and control for these purposes may be presumed to exist when a person owns 10% or more of our outstanding common stock.
Borrowers’ inability to repay such loans may have an adverse effect on our business, results of operations and financial condition. 19 Our business is subject to interest rate risk and variations in interest rates may have a material adverse effect on our financial performance.
Borrowers’ inability to repay such loans may have an adverse effect on our business, results of operations and financial condition. Our business is subject to interest rate risk and variations in interest rates may have a material adverse effect on our financial performance.
The Federal Reserve periodically evaluates a state member bank’s performance under applicable performance criteria and assign a rating of “outstanding,” “satisfactory,” “needs to improve” or “substantial noncompliance.” The Federal Reserve takes this performance into account when reviewing applications by banks and their parent companies to expand branches, relocate, add subsidiaries and affiliates, expand into new financial activities and merge with or acquire other financial institutions.
The Federal Reserve periodically evaluates a state member bank’s performance under applicable performance criteria and assigns a rating of “outstanding,” “satisfactory,” “needs to improve” or “substantial noncompliance.” The Federal Reserve takes this performance into account when reviewing applications by banks and their parent companies to expand branches, relocate, add subsidiaries and affiliates, expand into new financial activities and merge with or acquire other financial institutions.
The Federal Reserve Board regulates the supply of money and credit in the U.S. Its policies determine in large part the cost of funds for lending and investing and affect the return earned on those loans and investments, both of which in turn affect our net interest margin. They can also materially decrease the value of financial assets we hold.
The Federal Reserve Board regulates the supply of money and credit in the U.S. Its policies determine in large part the cost of funds for lending and investing and affect the return earned on those loans and investments, both of which in turn affect our net interest margin. It can also materially decrease the value of financial assets we hold.
As the federal debt level rises and interest rates remain elevated, the cost of servicing the debt may increase and the perceived creditworthiness of the U.S. government may decrease. The impact of any further downgrades to the U.S. government’s sovereign credit rating or its perceived creditworthiness could adversely affect the U.S. and global financial markets and economic conditions.
As the federal debt level rises and interest rates remain at elevated levels, the cost of servicing the debt may increase and the perceived creditworthiness of the U.S. government may decrease. The impact of any further downgrades to the U.S. government’s sovereign credit rating or its perceived creditworthiness could adversely affect the U.S. and global financial markets and economic conditions.
Adverse political and economic conditions could have an adverse effect on our business, results of operation and financial condition. We are subject to fluctuations in foreign currency exchange rates. Our foreign currency translation exposure derives, in part, from our China subsidiary that has its functional currency denominated in Chinese Renminbi (“RMB”).
Adverse political and economic conditions could have an adverse effect on our business, results of operations and financial condition. We are subject to fluctuations in foreign currency exchange rates. Our foreign currency translation exposure derives, in part, from our China subsidiary that has its functional currency denominated in Chinese Renminbi (“RMB”).
We face risks of loss resulting from, but not limited to, errors relating to transaction processing and technology, breaches of our internal control system or external compliance requirements, fraud or unauthorized transactions by employees or third parties, cybersecurity incidents, business continuation and disaster recovery.
We face risks of loss resulting from, but not limited to, errors relating to transaction processing and technology, breaches of our internal control system or external compliance requirements, fraud or unauthorized transactions by employees or third parties, cybersecurity incidents, ineffective business continuation and disaster recovery activities.
Any unfavorable economic, market, political, or industry conditions in California and other regions where we operate could lead to the following outcomes, among others: • greater than expected losses in our credit exposure due to unforeseen economic conditions, which may, in turn, adversely impact our results of operations and financial condition; • failure of our borrowers to make timely repayments of their loans, or a decrease in the value of real estate or other collateral securing the payment of such loans, which could result in credit losses, delinquencies, foreclosures and customer bankruptcies, and in turn have a material adverse effect on our results of operations and financial condition; • a decrease in deposit balances and in the demand for loans and other products and services; • disruptions in the capital markets or other events, including adverse actions by rating agencies and deteriorating investor expectations, which may result in an inability to borrow on favorable terms or at all from other financial institutions; • an adverse effect on the value of the debt securities portfolio as a result of debt defaults; and • a loss of confidence in the financial services industry, our market sector and the equity markets by investors, placing pressure on our stock price.
Any unfavorable economic, market, political, or industry conditions in California and other regions where we operate could lead to the following outcomes, among others: • greater than expected losses in our credit exposure due to unforeseen economic conditions, which may, in turn, adversely impact our results of operations and financial condition; • failure of our borrowers to make timely repayments of their loans, or a decrease in the value of real estate or other collateral securing the payment of such loans, which could result in credit losses, delinquencies, foreclosures and customer bankruptcies, and in turn have a material adverse effect on our results of operations and financial condition; • a decrease in deposit balances and in the demand for loans and other products and services; • disruptions in the capital markets or other events, including adverse actions by rating agencies and deteriorating investor expectations, which may result in an inability to borrow on favorable terms or at all from other financial institutions; • an adverse effect on the value of the debt securities portfolio as a result of debt defaults; and • a loss of confidence in the financial services industry, our market sector and the equity markets by investors, placing pressure on our stock price. 17 We face risks associated with international operations.
We are subject to extensive regulation under federal and state laws, as well as supervision and examination by the DFPI, FDIC, Federal Reserve, SEC, CFPB in the U.S. and foreign regulators and other government authorities. We are also subject to enforcement oversight by the DOJ and state attorneys general.
We are subject to extensive regulation under federal and state laws, as well as supervision and examinations by the DFPI, FDIC, Federal Reserve, SEC, CFPB in the U.S. and foreign regulators and other government authorities. We are also subject to enforcement oversight by the DOJ and state attorneys general.
Due to the inherent risk associated with accounting estimates, our allowance for loan losses and our reserve for losses associated with our unfunded credit commitments, which is determined using a similar methodology as that used to establish our allowance for loan losses, may not be adequate to absorb actual losses, and future provisions for such losses could have a material adverse effect on our business, results of operations, and financial condition.
Due to the inherent risk associated with accounting estimates, our ALLL and our reserve for losses associated with our unfunded credit commitments, which is determined using a similar methodology as that used to establish our ALLL, may not be adequate to absorb actual losses, and future provisions for such losses could have a material adverse effect on our business, results of operations, and financial condition.
The CFPB focuses its supervisory, examination, and enforcement efforts on, among other things: • risks to consumers and compliance with federal consumer financial laws when evaluating the policies and practices of a financial institution; • unfair, deceptive, or abusive acts or practices; • rulemaking to implement various federal consumer statutes such as the Home Mortgage Disclosure Act, Truth in Lending Act, Real Estate Settlement Procedures Act, Electronic Fund Transfer Act, Equal Credit Opportunity Act, Fair Credit Billing Act, and the Consumer Financial Protection Act; and • the markets in which firms operate and risks to consumers posed by activities in those markets.
The CFPB has historically focused its supervisory, examination, and enforcement efforts on, among other things: • risks to consumers and compliance with federal consumer financial laws when evaluating the policies and practices of a financial institution; • unfair, deceptive, or abusive acts or practices; 10 • rulemaking to implement various federal consumer statutes such as the Home Mortgage Disclosure Act, Truth in Lending Act, Real Estate Settlement Procedures Act, Electronic Fund Transfer Act, Equal Credit Opportunity Act, Fair Credit Billing Act, and the Consumer Financial Protection Act; and • the markets in which firms operate and risks to consumers posed by activities in those markets.
The potential for operational loss exposure exists throughout our organization and among our interactions with third parties, and are expected to increase as we expand our interconnectivity with our customers and other third parties.
The potential for operational loss exposure exists throughout our organization and among our interactions with third parties, and is expected to increase as we expand our interconnectivity with our customers and other third parties.
Our allowance for loan losses is based on our evaluation of risks associated with our loans held-for-investment portfolio, including historical loss experience, current borrower characteristics, current economic conditions, reasonable and supportable forecasts of future economic conditions, delinquencies, performing status, the size and composition of the loan portfolio, and concentrations within the portfolio.
Our ALLL is based on our evaluation of risks associated with our loans held-for-investment portfolio, including historical loss experience, current borrower characteristics, current economic conditions, reasonable and supportable forecasts of future economic conditions, delinquencies, performing status, the size and composition of the loan portfolio, and concentrations within the portfolio.
Rising interest rates may cause our funding costs to increase at a faster pace than the yield we earn from our assets, ultimately causing our net interest margin to decrease. Higher interest rates may also result in lower loan production and increased charge-offs in certain segments of the loan portfolio.
Rising interest rates may cause our funding costs to increase at a faster pace than the yield we earn from our assets, which would cause our net interest margin to decrease. Higher interest rates may also result in lower loan production and increased charge-offs in certain segments of our loan portfolio.
In addition, our counterparties, as well as our clients, rely on our financial strength and stability and evaluate the risks of doing business with us on a regular basis. If we experience a decline in our credit ratings, this could result in a decrease in the number of counterparties and clients who may be willing to transact with us.
In addition, our counterparties, as well as our clients, rely on our financial strength and stability and evaluate the risks of doing business with us on a regular basis. A decline in our credit ratings could result in a decrease in the number of counterparties and clients who may be willing to transact with us.
Generally Accepted Accounting Principles (“GAAP”), which includes the allowance for loan losses and the reserve for unfunded credit commitments.
Generally Accepted Accounting Principles (“GAAP”), which includes the allowance for loan and lease losses (“ALLL”) and the reserve for unfunded credit commitments.
Although we seek to manage our exposure to such risks, and employ a broad and diverse set of risk monitoring and mitigation techniques in the process, those techniques are inherently limited because they cannot anticipate the existence or development of risks that are currently unknown or unanticipated.
Although we seek to manage our exposure to such risks, and employ a broad and diverse set of risk monitoring and mitigation techniques in the process, including internal controls and disclosure controls and procedures, those techniques are inherently limited because they cannot anticipate the existence or development of risks that are currently unknown or unanticipated.
Failure to mitigate breaches of security, or to comply with increasingly demanding new and changing industry standards and regulatory requirements could also result in violation of applicable privacy laws, reputational damage, regulatory fines, litigation exposure, increased security compliance costs, and could have an adverse effect on our business, results of operations and financial condition.
Failure to mitigate breaches of security, or to comply with increasingly demanding new and changing industry standards and regulatory requirements could also result in violation of applicable privacy laws, reputational damage, regulatory fines, litigation exposure, increased security compliance costs, and could have an adverse effect on our business, results of operations and financial condition. 23 Failure to keep pace with technological change could adversely affect our business.
We have established processes and procedures intended to identify, measure, monitor, report, and analyze the types of risk to which we are subject, including capital, market, liquidity, credit, operational, compliance, legal, strategic, technology and reputational risks.
We have established corporate governance and enterprise risk management policies and procedures intended to identify, measure, monitor, report, and analyze the types of risk to which we are subject, including capital, market, liquidity, credit, operational, compliance, legal, strategic, technology and reputational risks.
Federal and California law limit the Bank’s ability to pay dividends to East West. Regulatory approval is required under federal law if the total of all dividends declared by the Bank in any calendar year would exceed the sum of the Bank’s net income for that year and its retained earnings for the preceding two years.
Regulatory approval is required under federal law if the total of all dividends declared by the Bank in any calendar year would exceed the sum of the Bank’s net income for that year and its retained earnings for the preceding two years.
The imposition of tariffs, retaliatory tariffs, export controls or other trade restrictions on products, materials or other goods that our customers import or export could impact prices, reduce demand, or otherwise negatively impact our customers’ businesses and their ability to service debt.
The timing and scope of future policy shifts remain uncertain. The imposition of tariffs, retaliatory tariffs, export controls or other trade restrictions on products, materials or other goods that our customers import or export could impact prices, reduce demand, or otherwise negatively impact our customers’ businesses and their ability to service debt.
Although we have historically declared cash dividends on our common stock, we are not required to do so and there may be circumstances under which we would reduce or eliminate our common stock dividend in the future.
Although we have historically declared cash dividends on our common stock, we are not required to do so and there may be circumstances under which we would reduce or eliminate our common stock dividend in the future. This could adversely affect the market price of our common stock.
The price of our common stock may be volatile or may decline. The price of our common stock may fluctuate in response to various factors, some of which are outside our control.
The price of our common stock may fluctuate in response to various factors, some of which are outside our control.
Our presence in Asia carries certain risks, including risks relating to our ability to generate revenues from foreign operations and to leverage and conduct business on an international basis, due to legal, regulatory, and tax requirements and restrictions; tariffs, trade barriers, or other trade restrictions; uncertainties regarding liability; difficulties in staffing and managing foreign operations; political and economic risks; and financial risks including currency and payment risks.
Our presence in Asia carries certain risks, including risks relating to our ability to generate revenues from foreign operations and to leverage and conduct business on an international basis, due to legal, regulatory, and tax requirements and restrictions, including restrictions relating to transactions involving access to certain data by persons outside of the U.S.; tariffs, trade barriers, or other trade restrictions; uncertainties regarding liability; difficulties in staffing and managing foreign operations; political and economic risks; and financial risks including currency and payment risks.
For example, the interagency council of the federal banking agencies, the Federal Financial Institutions Examination Council (“FFIEC”), has issued several policy statements and other guidance for banks in light of the growing risk posed by cybersecurity threats. The FFIEC has continued to focus on such matters as compromised customer credentials, cyber resilience and business continuity planning.
For example, the FFIEC has issued several policy statements and other guidance for banks in light of the growing risk posed by cybersecurity threats. The FFIEC has continued to focus on such matters as compromised customer credentials, cyber resilience and business continuity planning.
Los Robles Avenue, 7 th Floor, Pasadena, California 91101; by calling (626) 768-6000; or by sending an e-mail to InvestorRelations@eastwestbank.com. ITEM 1A. RISK FACTORS We, like other financial institutions, face risks inherent to our business, results of operations, and financial condition.
Los Robles Avenue, 7th Floor, Pasadena, California 91101; by calling (626) 768-6000; or by sending an e-mail to InvestorRelations@eastwestbank.com. 16 ITEM 1A. RISK FACTORS We, like other financial institutions, face numerous risks inherent to our business, results of operations, and financial condition, many of which are beyond our control.
We face risks associated with international operations. A substantial number of our customers have economic and cultural ties to Asia. The Bank’s international presence includes locations in Hong Kong, China and Singapore.
A substantial number of our customers have economic and cultural ties to Asia. The Bank’s international presence includes locations in Hong Kong, China and Singapore.
We operate in a heavily regulated industry and face significant risks from lawsuits and proceedings brought by customers, borrowers, bank regulators and counterparties. These actions include claims for monetary damages, penalties, fines, and demands for injunctive relief.
We are subject to significant financial and reputational risk arising from lawsuits and other legal proceedings. We operate in a heavily regulated industry and face significant risks from lawsuits and proceedings brought by customers, borrowers, bank regulators and counterparties. These actions include claims for monetary damages, penalties, fines, and demands for injunctive relief.
If the models are inadequate, or are subject to ineffective governance, our risk management program may also prove ineffective. Actions taken to mitigate identified risks may prove less effective than anticipated. If our risk management program proves ineffective, we could suffer unexpected losses and reputational damage.
If the models are inadequate, or are subject to ineffective governance, our risk management program may also prove ineffective. Actions taken to mitigate identified risks may prove less effective than anticipated.
Federal Home Loan Bank and the Federal Reserve’s Reserve Requirements The Bank is a member of the Federal Home Loan Bank (“FHLB”) of San Francisco. As an FHLB member, the Bank is required to own a certain amount of capital stock in the FHLB.
Federal Home Loan Bank and the Federal Reserve’s Reserve Requirements The Bank is a member of the Federal Home Loan Bank (“FHLB”) of San Francisco. As an FHLB member, the Bank is required to own a certain amount of capital stock in the FHLB. The Bank may also access both short- and long-term secured credit from the FHLB.
Risks Related to Our Operations A cyber-attack, information or security breach, or failure of our operational or security systems or infrastructure, or those of third-party vendors, could disrupt our business, and adversely impact our results of operations, financial condition, cash flows, and liquidity, as well as damage our reputation.
In addition, a downturn in sectors served by these institutions could increase credit risk to us and negatively impact our business, results of operations, and financial condition. 22 Risks Related to Our Operations A cyber-attack, information or security breach, or failure of our operational or security systems or infrastructure, or those of third-party vendors, could disrupt our business, and adversely impact our results of operations, financial condition, cash flows, and liquidity, as well as damage our reputation.
IDIs with total assets of $100 billion or more are required to submit full resolution plans, and IDIs with total assets between $50 billion and $100 billion, including the Bank, are required to submit more limited informational filings. Going forward, the Bank will be required to submit informational filings every three years and interim supplements annually.
IDIs with total assets of $100 billion or more are required to submit full resolution plans, and IDIs with total assets between $50 billion and $100 billion, including the Bank, are required to submit more limited informational filings.
Ongoing or increased competition may put pressure on the pricing for our products and services or may cause us to lose market share, particularly with respect to traditional banking products such as loans and deposits.
If consumers and businesses shift to stablecoins for payments and liquidity management, we may face reduced demand for our traditional products. Ongoing or increased competition may put pressure on the pricing for our products and services or may cause us to lose market share, particularly with respect to traditional banking products such as loans and deposits.
This could adversely affect the market price of our common stock. 21 We are subject to liquidity risk, which could negatively affect the level or cost of our funding.
We are subject to liquidity risk, which could negatively affect the level or cost of our funding.
Unsatisfactory CRA performance may result in the denial of such applications. Based on the most recent CRA examination as of March 8, 2021, the Bank was rated “outstanding”. On October 24, 2023, the federal banking agencies issued a final rule revising their framework for evaluating banks’ records of community reinvestment under the CRA.
Unsatisfactory CRA performance may result in the denial of such applications. On October 24, 2023, the federal banking agencies issued a final rule revising their framework for evaluating banks’ records of community investment under the CRA.
Failure to keep pace with technological change could adversely affect our business. We may face risks associated with the utilization of information technology systems to support our operations effectively. The financial services industry is continuously undergoing rapid technological change with frequent introductions of new technology-driven products and services, including financial technology and non-banking entities.
We may face risks associated with the utilization of information technology systems to support our operations effectively. The financial services industry is continuously undergoing rapid technological change with frequent introductions of new technology-driven products and services, including recent rapid developments in artificial intelligence.
See Item 1. Business — Supervision and Regulation — Dividends and Other Transfers of Funds in this Form 10-K for a discussion of regulatory requirements applicable to dividends by us and the Bank.
Various federal and California laws and regulations, as well as regulatory expectations, limit the amount of dividends that the Bank may pay to us. See Item 1. Business — Supervision and Regulation — Dividends and Other Transfers of Funds in this Form 10-K for a discussion of regulatory requirements applicable to dividends by us and the Bank.
Given that banks operate in an extensively regulated environment under federal and state law, good standing with our regulators is of fundamental importance to the continuation and growth of our business.
Further, as we increase in size additional regulatory requirements may become applicable to us. 26 Given that banks operate in an extensively regulated environment under federal and state law, good standing with our regulators is of fundamental importance to the continuation and growth of our business.
The FDIC may terminate a depository institution’s deposit insurance upon a finding that the institution’s financial condition is unsafe or unsound, that the institution has engaged in unsafe or unsound practices, or that the institution has violated any applicable rule, regulation, condition, or order imposed by the FDIC. 13 Bank Secrecy Act and Anti-Money Laundering The Bank Secrecy Act (“BSA”), Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001 (“PATRIOT Act”), the Anti-Money Laundering Act of 2020 and other federal laws and regulations impose obligations on U.S. financial institutions to implement and maintain a program reasonably designed to prevent, detect and report money laundering and the financing of terrorism, verify the identity of their customers, and comply with recordkeeping and other requirements.
Bank Secrecy Act and Anti-Money Laundering The Bank Secrecy Act (“BSA”), Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001 (“PATRIOT Act”), the Anti-Money Laundering Act of 2020 and other federal laws and regulations impose obligations on U.S. financial institutions to implement and maintain a program reasonably designed to prevent, detect and report money laundering and the financing of terrorism, verify the identity of their customers, and comply with recordkeeping and other requirements.
The Bank may also access both short- and long-term secured credit from the FHLB. 11 The Federal Reserve requires all depository institutions to maintain reserves at specified levels against their transaction accounts either in the form of vault cash or an interest-bearing account at the Federal Reserve Bank (“FRB”), or a pass-through account as defined by the Federal Reserve.
The Federal Reserve requires all depository institutions to maintain reserves at specified levels against their transaction accounts either in the form of vault cash or an interest-bearing account at the Federal Reserve Bank (“FRB”), or a pass-through account as defined by the Federal Reserve. Reserve requirements are currently set at zero percent.
Consequently, the impact of these changes on our business, results of operations and financial condition is difficult to predict. 20 Further downgrades of the U.S. credit rating, potential automatic spending cuts or a government shutdown could negatively impact our business, results of operation and financial condition.
Further downgrades of the U.S. credit rating, potential automatic spending cuts or government shutdowns could negatively impact our business, results of operations and financial condition.
The BSA, the PATRIOT Act, and other laws and regulations require us and other financial institutions to institute and maintain an effective AML program and file suspicious activity reports and currency transaction reports when appropriate.
Complying with the Bank Secrecy Act and other anti-money laundering and sanctions statutes and regulations can increase our compliance costs and risks. The BSA, the PATRIOT Act, and other laws and regulations require us and other financial institutions to institute and maintain an effective AML program and file suspicious activity reports and currency transaction reports when appropriate.
Risks Related to Financial Matters A significant portion of our loan portfolio is secured by real estate and at a higher degree of risk from a downturn in real estate markets. Since many of our loans are secured by real estate, a decline in the real estate markets could impact our business and financial condition.
These climate-driven changes could materially and negatively impact our and our customers’ business, results of operations, financial condition and reputation. 18 Risks Related to Financial Matters A significant portion of our loan portfolio is secured by real estate and at a higher degree of risk from a downturn in real estate markets.
The Federal Reserve requires bank holding companies to continuously review their dividend policy in light of their organizations’ financial condition and in compliance with regulatory capital requirements, and discourages payment ratios that are at maximum allowable levels, unless both asset quality and capital are strong.
The Federal Reserve requires bank holding companies to continuously review their dividend policy in light of their organizations’ financial condition and in compliance with regulatory capital requirements, and discourages payment ratios that are at maximum allowable levels, unless both asset quality and capital are strong. 11 Transactions with Affiliates and Insiders Pursuant to Sections 23A and 23B of the Federal Reserve Act, as implemented by the Federal Reserve’s Regulation W, banks are subject to restrictions that limit their ability to engage in transactions with their affiliates, including their parent bank holding companies.
The terms of such extensions of credit may not involve more than the normal risk of repayment or present other unfavorable features and may not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the bank’s capital. 12 Community Reinvestment Act Under the CRA, an IDI has a continuing and affirmative obligation to help serve the credit needs of its communities, including low- and moderate-income borrowers and neighborhoods.
The terms of such extensions of credit may not involve more than the normal risk of repayment or present other unfavorable features and may not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the bank’s capital.
The Bank is also subject to additional capital requirements under the Prompt Corrective Action (“PCA”) regulations that implement Section 38 of the Federal Deposit Insurance Act (“FDIA”), as discussed below under the Prompt Corrective Action section.
The Bank is also subject to additional capital requirements under the Prompt Corrective Action (“PCA”) regulations that implement Section 38 of the Federal Deposit Insurance Act (“FDIA”), as discussed below under the Prompt Corrective Action section. 9 Prompt Corrective Action The FDIA, as amended, requires federal banking agencies to take PCA with respect to insured depository institutions (“IDIs”) that do not meet minimum capital requirements.
We are dependent on key personnel and the loss of one or more of those key personnel may materially and adversely affect our prospects.
If our risk management program proves ineffective, we could suffer unexpected losses and reputational damage. 24 We are dependent on key personnel and the loss of one or more of those key personnel may materially and adversely affect our prospects.
The risks below address factors of which we are currently aware that could impact us materially by causing actual results to differ from our historical results or the results contemplated by the forward-looking statements contained in this Form 10-K. Although these risks are organized by headings and each risk is discussed separately, many are interrelated.
The risk factors described below relate to known risks that could materially impact our business, results of operations, financial condition and the outcome of any matter as to which forward-looking statements contained in this Form 10-K are made. Although these risks are organized by headings and each risk is discussed separately, many are interrelated.
Many of our competitors have substantially greater resources to invest in technological solutions. We may not be able to effectively implement new technology-driven products and services or be successful in marketing these products and services to our customers.
We may not be able to effectively implement new technology-driven products and services or be successful in marketing these products and services to our customers, and our efforts to use technological developments to improve the efficiency of our operations may not be effective or may lag our competitors.
The assessment rate is calculated based on an institution’s risk profile, including capital adequacy, asset quality, management, earnings, liquidity and sensitivity to market risk ratings, certain financial measures to assess an institution’s ability to withstand asset related stress and funding related stress, and a measure of loss severity that estimates the relative magnitude of potential losses to the FDIC in the event of the Bank’s failure.
The assessment rate is calculated based on an institution’s risk profile, including capital adequacy, asset quality, management, earnings, liquidity and sensitivity to market risk ratings, certain financial measures to assess an institution’s ability to withstand asset related stress and funding related stress, and a measure of loss severity that estimates the relative magnitude of potential losses to the FDIC in the event of the Bank’s failure. 12 A 2022 FDIC rule increased the initial base deposit insurance assessment rate schedules uniformly by two basis points (“bps”) beginning in the first quarterly assessment period of 2023, and this increase will remain in effect until the reserve ratio of the DIF meets or exceeds 2 percent.
Our borrowing costs may also be affected by various external factors, including market volatility and concerns or perceptions about the financial services industry. There can be no assurance that we can maintain our credit ratings nor that they will not be changed in the future.
Our borrowing costs may also be affected by various external factors, including market volatility and concerns or perceptions about the financial services industry.
We may be required to increase our capital levels, even in the absence of actual adverse economic conditions or forecasts, and enhance capital planning based on hypothetical future adverse economic scenarios. As of December 31, 2024, we met the requirements of the Basel III Capital Rules, including the capital conservation buffer.
We and the Bank are subject to certain capital and liquidity rules, including the Basel III Capital Rules, which establish the minimum capital adequacy requirements and may require us to increase our regulatory capital levels and/or targets even in the absence of actual adverse economic conditions or forecasts, and enhance capital planning based on hypothetical future adverse economic scenarios.
Our ability to attract and retain employees may also be harmed if our response to climate change is perceived to be ineffective or insufficient. These climate-driven changes could materially and negatively impact our and our customers’ business, results of operations, financial condition and reputation.
Our ability to attract and retain employees may also be harmed if our response to climate change is perceived to be ineffective or insufficient.
We derive most of our cash flow from dividends paid by the Bank. These dividends are the primary source from which we pay dividends on our common stock and principal and interest on our debt obligations. Various federal and California laws and regulations, as well as regulatory expectations, limit the amount of dividends that the Bank may pay to us.
As a holding company, we depend on dividends and distributions from the Bank for our liquidity. We derive most of our cash flow from dividends paid by the Bank. These dividends are the primary source from which we pay dividends on our common stock and principal and interest on our debt obligations.
The FDIA also generally permits only “well capitalized” IDIs to accept brokered deposits, although an “adequately capitalized” institution may apply to the FDIC for a waiver of this restriction. 10 Stress Testing Under the enhanced prudential standards adopted by the Federal Reserve, bank holding companies with $100 billion or more in total assets are subject to supervisory capital stress tests and internal liquidity stress testing requirements.
Stress Testing Under the enhanced prudential standards adopted by the Federal Reserve, bank holding companies with $100 billion or more in total assets are subject to supervisory capital stress tests and internal liquidity stress testing requirements.
There can be no assurance that we will achieve our anticipated effective tax rate. The U.S. government could further introduce new tax legislation or amend current tax laws in a manner that would adversely affect us. Complying with the Bank Secrecy Act and other anti-money laundering and sanctions statutes and regulations can increase our compliance costs and risks.
There can be no assurance that we will achieve our anticipated effective tax rate. The U.S. government could further introduce new tax legislation or amend current tax laws in a manner that would adversely affect us. In July 2025, the OBBBA was signed into law, introducing significant tax changes.
Natural disasters, the effects of climate change and geopolitical events beyond our control could adversely affect our business, results of operations, and financial condition.
Changes in such laws and regulations, regulatory oversight, foreign exchange controls, tariffs, or geopolitical conflict also may adversely impact our international operations. Natural disasters, the effects of climate change and geopolitical events beyond our control could adversely affect our business, results of operations, and financial condition.
Negative publicity regarding our business, employees or customers, with or without merit, may result in the loss of customers, investors and employees, costly litigation, a decline in revenues and increased governmental scrutiny. 29 Evolving expectations relating to environmental, social and governance considerations may expose us to additional costs, reputational harm, and other adverse effects on our business.
Negative publicity regarding our business, employees or customers, with or without merit, may result in the loss of customers, investors and employees, costly litigation, a decline in revenues and increased governmental scrutiny. 29 The price of our common stock may be volatile or may decline.
Our ability to recover on defaulted loans by foreclosing and selling the real estate collateral would be further diminished, and we would be more likely to suffer losses on defaulted loans. Furthermore, CRE and multifamily residential loans typically involve larger balances to single borrowers or groups of related borrowers.
If real estate values decline, the value of real estate collateral securing our loans could be significantly reduced. Our ability to recover on defaulted loans by foreclosing and selling the real estate collateral would be further diminished, and we would be more likely to suffer losses on defaulted loans.
In addition, there may be additional risks that may impact us materially that are not presently known, that are not currently believed to be significant, or that are common to all businesses. 17 Risks Related to Geopolitical Uncertainties Unfavorable general economic, market, political or industry conditions, either domestically or internationally, may adversely affect our business, results of operations, and financial condition.
Risks Related to Geographic and Political Uncertainties Unfavorable general economic, market, political or industry conditions, either domestically or internationally, may adversely affect our business, results of operations, and financial condition.
In November 2023, the FDIC approved a final rule to implement a special deposit insurance assessment to recover losses to the DIF arising from the protection of uninsured depositors following the receiverships of failed institutions in the spring of 2023.
In November 2023, the FDIC approved a final rule to implement a special deposit insurance assessment for eight quarters, starting with the first quarter of 2024, to recover losses to the DIF arising from bank failures that occurred in the Spring of 2023.
We may also experience a decrease in the demand for loans and other financial products or a deterioration in the credit quality of the loans extended to customers in industry sectors that are most sensitive to the trade restrictions. 18 Further, a downturn in economic growth and real estate markets in China and volatility in the Shanghai and Hong Kong stock exchanges, among other things, may negatively impact asset values and the profitability and liquidity of our customers operating in this region.
We may also experience a decrease in the demand for loans and other financial products or a deterioration in the credit quality of the loans extended to customers in industry sectors that are most sensitive to the trade restrictions.
Effective March 26, 2020, the Federal Reserve reduced reserve requirement ratios to zero percent, eliminating the reserve requirement for all depository institutions. The Bank is a member bank and stockholder of the FRB of San Francisco. Dividends and Other Transfers of Funds The principal source of liquidity of East West is dividends received from the Bank.
The Bank is a member bank and stockholder of the FRB of San Francisco. Dividends and Other Transfers of Funds The principal source of liquidity of East West is dividends received from the Bank. Federal and California law limit the Bank’s ability to pay dividends to East West.
Under the final rule, if the FDIC deemed a resolution plan or informational filing not credible and the IDI failed to resubmit a credible plan, the IDI could become subject to an enforcement action. The Company has established a management-level working group to meet the requirements under the final rule for timely submission on or before October 1, 2025.
If the FDIC deemed a resolution plan or informational filing not credible and the IDI then failed to resubmit a credible plan, the IDI could become subject to an enforcement action.
The Company is a reporting entity under both laws and may incur compliance, maintenance, and remediation costs to conform to such requirements. 15 Resolution Planning On June 20, 2024, the FDIC released a final rule that requires covered IDIs to develop and submit detailed plans demonstrating how they could be resolved in an orderly and timely manner in the event of receivership.
The Company is a reporting entity under both SB 253 and SB 261 and has engaged a third-party firm to support compliance with these laws. 14 Resolution Planning FDIC rules require covered IDIs to develop and submit detailed plans demonstrating how they could be resolved in an orderly and timely manner in the event of receivership.
Since payments on these loans are often dependent on the successful operation or management of the properties, as well as the business and financial condition of the borrowers, repayment of such loans may be subject to adverse conditions in the real estate market, adverse economic conditions, shifts in demand for different types of properties, or changes in applicable government regulations.
Repayment of such loans may be subject to adverse conditions in the real estate market such as declining property values, rising interest rates, higher vacancy rates or tenant defaults, adverse economic conditions, shifts in demand for different types of properties, or changes in applicable government regulations.

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