EAST WEST BANCORP INC
For the period ended Dec 31, 2023. Filed Feb 29, 2024.
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FY2023 · Filed Feb 29, 2024
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Noninterest Income
The following table presents the components of noninterest income for the periods indicated:
| Year Ended December 31, | ||||
|---|---|---|---|---|
| ($ in thousands) | 2023 | 2022 | % Change from 2022 | 2021 |
| Lending fees | $83,876 | $79,208 | 6% | $77,704 |
| Deposit account fees | 89,606 | 88,435 | 1% | 71,261 |
| Customer derivative income | 20,200 | 29,057 | (30)% | 22,913 |
| Foreign exchange income | 52,481 | 48,158 | 9% | 48,977 |
| Wealth management fees | 26,805 | 27,565 | (3)% | 25,751 |
| Net gains on sales of loans | 3,634 | 6,411 | (43)% | 8,909 |
| Net (losses) gains on AFS debt securities | (6,862) | 1,306 | NM | 1,568 |
| Other investment income | 9,348 | 7,037 | 33% | 16,852 |
| Other income | 16,176 | 11,489 | 41% | 11,960 |
| Total noninterest income | $295,264 | $298,666 | (1)% | $285,895 |
Noninterest income comprised 11% and 13% of total revenue in 2023 and 2022, respectively. Noninterest income for 2023 was $295 million, compared with $299 million in 2022. The decrease was primarily due to lower customer derivative income and net losses on AFS debt securities, partially offset by increases in other income, lending fees, and foreign exchange income.
Lending fees were $84 million in 2023, an increase of $5 million or 6%, compared with $79 million in 2022. The year-over-year increase was driven by higher unused commitment and letter of credit facility fees.
Customer derivative income was $20 million in 2023, a decrease of $9 million or 30%, compared with $29 million in 2022. The year-over-year decrease was primarily due to unfavorable credit valuation adjustments, partially offset by higher transaction volume, interest received on derivative collateral posted and energy contract income.
Foreign exchange income was $52 million, an increase of $4 million or 9%, compared with $48 million in 2022. The year-over-year increase was primarily due to higher gains on foreign exchange trades, partially offset by the unfavorable valuation of certain foreign currency denominated balance sheet items.
Net losses on AFS debt securities of $7 million in 2023 were due to a $10 million write-off of an impaired subordinated AFS debt security during the first quarter of 2023, partially offset by a $3 million gain when the security was sold in the fourth quarter of 2023. In comparison, net gains on AFS debt securities were $1 million in 2022.
Other income was $16 million in 2023, an increase of $5 million or 41%, compared with $11 million in 2022. The year-over-year increase was primarily due to higher income from bank-owned life insurance policies.
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