EAST WEST BANCORP INC

The following discussion provides information about the results of operations, financial condition, liquidity and capital resources of East West Bancorp, Inc. (referred to herein on an unconsolidated basis as “East West” and on a consolidated basis as the “Company,” “we,” “our” or “EWBC”) and its subsidiaries, including its subsidiary bank, East West Bank and its subsidiaries (referred to herein as “East West Bank” or the “Bank”). This information is intended to facilitate the understanding and assessment of significant changes and trends related to the Company’s results of operations and financial condition. This discussion and analysis should be read in conjunction with the Consolidated Financial Statements and the accompanying notes presented elsewhere in this Quarterly Report on Form 10-Q (this “Form 10-Q”), and the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, filed with the United States (“U.S.”) Securities and Exchange Commission (“SEC”) on February 28, 2025 (the “Company’s 2024 Form 10-K”).

Organization and Strategy

East West is a bank holding company incorporated in Delaware on August 26, 1998, and is registered under the Bank Holding Company Act of 1956, as amended. The Company commenced business on December 30, 1998 when, pursuant to a reorganization, it acquired all of the voting stock of the Bank, which became its principal asset. The Bank is an independent commercial bank headquartered in California that focuses on the financial service needs of individuals and businesses that operate in both the U.S. and Asia. Through over 110 locations in the U.S. and Asia, the Company provides a full range of consumer and commercial products and services through the following three business segments: (1) Consumer and Business Banking and (2) Commercial Banking, with the remaining operations recorded in (3) Treasury and Other. The Company’s principal activity is lending to and accepting deposits from businesses and individuals. We are committed to enhancing long-term shareholder value by growing loans, deposits and revenue, improving profitability, and investing for the future while managing risks, expenses and capital. Our business model is built on customer loyalty and engagement, understanding our customers’ financial goals, and meeting our customers’ financial needs through our diverse products and services. We expect our relationship-focused business model to continue generating organic growth from existing customers and to expand our targeted customer bases. As of March 31, 2025, the Company had $76.2 billion in total assets and approximately 3,200 full-time equivalent employees. For additional information on our strategy, and the products and services provided by the Bank, see Item 1. Business — Organizationand Banking Servicesin the Company’s 2024 Form 10-K.

Current Developments

Economic Developments

In April 2025, President Donald J. Trump’s administration (“Trump administration”) announced wide-ranging tariffs targeting trade partners worldwide. This recent shift in trade policy has raised concerns about a slowdown in economic growth, elevated inflation levels, market volatility and a potential recession. The Federal Reserve is expected to move cautiously with respect to interest rate cuts, balancing potential job losses and elevated inflation levels. Meanwhile, mortgage rates and home prices remain high, creating affordability challenges for many consumers. The economic uncertainty caused by these factors could result in decreased consumer spending and curb business investments, which could affect both the demand and performance of loans. However, the Trump administration’s focus on deregulation and capital reform could promote growth for banks. Deregulation could lead to increased access to capital for businesses and consumers as fewer restrictions would encourage banks to extend credit. The Company monitors changes in economic and industry conditions and their impacts on the Company’s business, customers, employees, communities and markets.

Further discussion of the potential impacts on the Company’s business due to the economic environment has been provided in Item 1A. — Risk Factors — Risks Related to Geopolitical Uncertaintiesand — Risks Related to Financial Mattersin the Company’s 2024 Form 10-K.

Climate Accountability

California Climate Reporting Laws

In October 2023, California Governor Gavin Newsom signed into law Senate Bill No. 253, the Climate Corporate Data Accountability Act (“SB 253”) and Senate Bill No. 261, the Climate-Related Financial Risk Act (“SB 261”). SB 253 requires companies with annual revenues exceeding $1 billion that conduct business in California to report their Scope 1 and 2 greenhouse gas (“GHG”) emissions annually starting in 2026; and Scope 3 GHG emissions starting in 2027. SB 261 applies to companies with annual revenues over $500 million that are operating in California, and mandates disclosure of climate-related financial risks and mitigation measures taken to address such risks with the first report due on January 1, 2026, and biennially thereafter.

On September 27, 2024, California Governor Gavin Newsom signed Senate Bill No. 219 (“SB 219”) into law, making some updates to SB 253 and SB 261, one of which extended the deadline for the California Air Resources Board (“CARB”) to adopt the regulations for SB 253 from January 1, 2025 to July 1, 2025. Other SB 219 changes included clarifying that companies subject to SB 253 can submit consolidated reporting at the parent- level, allowing CARB to set more specific timing for Scope 3 emission disclosures within 2027, and providing CARB the option to receive disclosures either directly or through an emissions reporting organization it contracts with.

Scope 1 emissions are direct emissions from sources owned or controlled by the Company. Scope 2 emissions are indirect emissions from purchased energy; and Scope 3 emissions encompass all other indirect emissions throughout a company’s supply chain. On December 5, 2024, CARB issued an Enforcement Notice for SB 253. CARB announced that it will exercise enforcement discretion for the first reporting cycle in 2026 relating to Scope 1 and Scope 2 GHG emissions disclosures. CARB stated that companies making a good-faith effort to comply with SB 253 will not face penalties for incomplete Scope 1 and Scope 2 GHG emissions disclosures, and may submit initial disclosures in 2026 based on data they currently possess, or were in the process of collecting at the time the notice was issued.

The Company is a reporting entity under both SB 253 and SB 261 and has been monitoring the development of CARB’s implementing regulations. The Company has engaged a third-party firm to facilitate the implementation of CARB’s regulations.

Climate Disclosure Rules

On March 6, 2024, the SEC adopted final rules requiring disclosure of climate-related risks and risk management as well as the board and management’s governance of such risks. The SEC voluntarily stayed the rules on April 4, 2024 pending the completion of judicial review of consolidated legal challenges to the rules by the United States Circuit Court of Appeals for the Eighth Circuit (the “Court”). On March 27, 2025, the SEC announced that it had voted to withdraw its defense of the rules, although the rules continue to be defended by several intervening states and the District of Columbia. On April 24, 2025, the Court issued an order to hold the cases in abeyance and directed the SEC to file a status report within 90 days to inform the Court whether it intends to review or reconsider the rules. In addition, the order provides that if the SEC has determined that it will not take action, the report should address whether the SEC will adhere to the rules if they are upheld and, if not, why the SEC will not review or reconsider the rules at this time.

Resolution Planning

On June 20, 2024, the Federal Deposit Insurance Corporation (“FDIC”) released a final rule that requires covered insured depository institutions (“IDIs”) to develop and submit detailed plans demonstrating how they could be resolved in an orderly and timely manner in the event of receivership. 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. 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. Going forward, the Bank will be required to submit informational filings every three years and interim supplements annually.

Regulatory Updates

On August 23, 2024, the FDIC published a proposed rule that would revise the FDIC’s regulations governing the classification and treatment of brokered deposits. On March 14, 2025, the FDIC withdrew the proposed rule.

On October 24, 2023, the federal banking agencies issued a final rule revising their framework for evaluating banks’ records of community reinvestment under the Community Reinvestment Act (“CRA”). On March 28, 2025, the agencies announced their intent to issue a proposal to rescind the October 2023 final rule and to reinstate the CRA framework that existed prior to the October 2023 final rule. The Bank received a rating of “Outstanding” in its most recent performance evaluation, which was conducted using the CRA framework that existed prior to the October 2023 final rule.