EAST WEST BANCORP INC

Our MD&A analyzes the financial condition and results of operations of the Company for 2023 and 2022. Some tables include additional periods to comply with disclosure requirements or to illustrate trends in greater depth. The page locations of specific sections that we refer to are presented in the table of contents. To review our financial condition and results of operations for 2022 and a comparison between 2022 and 2021 results, see Item 7. MD&A of our 2022 Form 10-K, which was filed with the SEC on February 27, 2023.

(1)For additional information regarding the reconciliation of these non-U.S. GAAP financial measures, refer to Item 7. MD&A — Reconciliation of GAAP to Non-GAAP Financial Measuresin this Form 10-K.

(2)Efficiency ratio is calculated as noninterest expense divided by total revenue.

The Company’s 2023 net income was $1.2 billion, an increase of $33 million, or 3%, from 2022 net income of $1.1 billion. The increase was primarily due to higher net interest income before provision for credit losses, partially offset by increases in the noninterest expense, provision for credit losses and income tax expense. Noteworthy items about the Company’s performance for 2023 included:

•Net interest income growth and net interest margin expansion. Year-over-year net interest income before provision for credit losses grew by $266 million or 13% to $2.3 billion in 2023, from $2.0 billion in 2022. Full year 2023 net interest margin was 3.61%, up 16 bps year-over-year.

•Earnings Per Share growth. Basic, diluted and adjusted diluted EPS for 2023 increased to $8.23, $8.18 and $8.56, respectively, compared with $7.98, $7.92 and $7.92, respectively, in 2022. The adjusted diluted EPS for 2023 excluded the $70 million pre-tax FDIC special assessment-related charge (the “FDIC charge”) incurred as a result of the final rule implemented by the FDIC to recover losses in the DIF, and a net loss of $7 million pre-tax on an AFS debt security. Adjusted diluted EPS is a non-GAAP financial measure. For additional details, see the reconciliation of non-GAAP financial measures presented under Item 7. MD&A —Reconciliation of GAAP to Non-GAAP Financial Measures in this Form 10-K.

•Efficiency ratios. The efficiency ratio was 39.22% in 2023, or 257 bps higher compared with 2022, while the adjusted efficiency ratio was 31.63% in 2023, an improvement of 11 bps from 2022. The higher efficiency ratio in 2023 was due to the FDIC charge discussed above. Adjusted efficiency ratio is a non-GAAP financial measure. For additional details, see the reconciliation of non-GAAP financial measures presented under Item 7. MD&A —Reconciliation of GAAP to Non-GAAP Financial Measures in this Form 10-K.

•Asset growth. Total assets reached $69.6 billion, an increase of $5.5 billion or 9% year-over-year, primarily driven by loan growth of $4.0 billion or 8%, and an increase in cash and cash equivalents of $1.1 billion or 33%. The increase in cash and cash equivalents was primarily funded with borrowings from the Bank Term Funding Program (“BTFP”).

•Loan growth. Total loans were $52.2 billion as of December 31, 2023, a year-over-year increase of $4.0 billion or 8% from $48.2 billion. This was primarily driven by growth in the residential mortgage, CRE, and commercial and industrial (“C&I”) loan segments.

•Strong capital levels. Stockholders’ equity was $7.0 billion or $49.64 per share as of December 31, 2023, up from $6.0 billion or $42.46 per share as of December 31, 2022. Tangible book value per share of $46.27 as of December 31, 2023, increased $7.17 or 18% from $39.10 as of December 31, 2022. Tangible book value per share is a non-GAAP financial measure. For additional details, see the reconciliation of non-GAAP financial measures presented under Item 7. MD&A — Reconciliation of GAAP to Non-GAAP Financial Measuresin this Form 10-K.