EAST WEST BANCORP INC

The following table presents the components of noninterest expense for the second quarters and first halves of 2025 and 2024:

Noninterest expense was $256 million for the second quarter of 2025, an increase of $20 million or 9%, compared with the second quarter of 2024. The year-over-year increase was primarily due to increases in compensation and employee benefits, amortization of tax credit and CRA investments, and computer and software related expenses, partially offset by a decrease in deposit account expense. For the first half of 2025, noninterest expense was $508 million, an increase of $26 million or 5%, compared with the first half of 2024. The year-over-year increase was primarily due to increases in compensation and employee benefits, amortization of tax credit and CRA investments, other operating expense, and computer and software related expenses, partially offset by decreases in deposit insurance premiums and regulatory assessments, and deposit account expense.

Compensation and employee benefits were $145 million for the second quarter of 2025, an increase of $11 million or 8%, compared with the second quarter of 2024. For the first half of 2025, compensation and employee benefits were $291 million, an increase of $16 million or 6%, compared with the first half of 2024. The increases were primarily driven by merit increases and staffing growth.

Deposit account expense was $9 million for the second quarter of 2025, a decrease of $3 million or 22%, compared with the second quarter of 2024. For the first half of 2025, deposit account expense was $18 million, a decrease of $6 million or 24%, compared with the first half of 2024. The decreases were driven primarily by lower balances and referral rates paid on certain deposit accounts.

Computer and software related expenses were $13 million for the second quarter of 2025, an increase of $2 million or 18%, compared with the second quarter of 2024. For the first half of 2025, computer and software expenses were $27 million, an increase of $4 million or 18%, compared with the first half of 2024. These increases primarily reflected higher software expenses and data processing costs.

Deposit insurance premiums and regulatory assessments were $9 million for the second quarter of 2025, a decrease of $2 million or 15%, compared with the second quarter of 2024. For the first half of 2025, deposit insurance premiums and regulatory assessments were $20 million, a decrease of $11 million or 36%, compared with the first half of 2024. The decreases were primarily due to additional FDIC special assessment charges (“FDIC charges”) of $2 million and $12 million recorded during the second quarter and first half of 2024, respectively. Adjustments to the FDIC charge pertain primarily to changes in the FDIC’s estimated losses to the Deposit Insurance Fund. For additional information on the FDIC charge, refer to Item 1. Business — Supervision and Regulation — FDIC Deposit Insurance Assessmentsin the Company’s 2024 Form 10-K.

Other operating expense of $37 million for the second quarter of 2025 was essentially flat compared with the second quarter of 2024. For the first half of 2025, the $9 million or 13% increase in other operating expense to $78 million, compared with the first half of 2024 was primarily due to problem loan related expenses and higher consulting expenses for various Company initiatives.

Amortization of tax credit and CRA investments was $26 million for the second quarter of 2025, an increase of $10 million or 63%, compared with the second quarter of 2024. For the first half of 2025, amortization of tax credit and CRA investments was $42 million, an increase of $13 million or 43%, compared with the first half of 2024. The year-over-year increases were primarily due to the timing of tax credit investments that closed in a given period.