EAST WEST BANCORP INC

The following table presents the components of noninterest expense for the third quarters and first nine months of 2025 and 2024:

Noninterest expense was $277 million for the third quarter of 2025, an increase of $51 million or 23%, compared with the third quarter of 2024. The year-over-year increase was primarily due to increases in compensation and employee benefits and amortization of tax credit and CRA investments. For the first nine months of 2025, noninterest expense was $785 million, an increase of $77 million or 11%, compared with the first nine months 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 other operating expense, partially offset by decreases in deposit insurance premiums and regulatory assessments, and deposit account expense.

Compensation and employee benefits were $176 million for the third quarter of 2025, an increase of $40 million or 30%, compared with the third quarter of 2024. For the first nine months of 2025, compensation and employee benefits were $467 million, an increase of $56 million or 14%, compared with the first nine months of 2024. The increases were primarily driven by $27 million from the change in equity award expense recognition for retirement eligible employees, while the remaining increase was due to merit increases and staffing growth. Refer to Note 1 — Basis of Presentation, Current Accounting Developments and Summary of Significant Accounting Policies Update for further details of the change in stock-based compensation policy.

Deposit account expense was $9 million for the third quarter of 2025, a decrease of $3 million or 28%, compared with the third quarter of 2024. For the first nine months of 2025, deposit account expense was $27 million, a decrease of $9 million or 25%, compared with the first nine months of 2024. The decreases were driven primarily by lower balances and referral rates paid on certain deposit accounts.

Deposit insurance premiums and regulatory assessments were $9 million for the third quarter of 2025, a $1 million or 6% decrease, compared with the third quarter of 2024. For the first nine months of 2025, deposit insurance premiums and regulatory assessments were $28 million, an $11 million or 29% decrease, compared with the first nine months of 2024. The decreases were primarily due to lower FDIC special assessment charges (“FDIC charges”), which reflected a decrease in the estimated losses to the FDIC’s Deposit Insurance Fund. For additional information on the FDIC charges, refer to Item 1. Business — Supervision and Regulation — FDIC Deposit Insurance Assessmentsin the Company’s 2024 Form 10-K.

Other operating expense was $38 million for the third quarter of 2025, an increase of $3 million or 10%, compared with the third quarter of 2024. For the first nine months of 2025, other operating expense was $116 million, an increase of $12 million or 12%, compared with the first nine months of 2024. The increase for the first nine months was primarily due to problem loan related expenses, higher consulting expenses for various Company initiatives, and other real estate owned (“OREO”) write-downs, partially offset by lower legal expenses.

Amortization of tax credit and CRA investments was $16 million for the third quarter of 2025, an increase of $10 million or 180%, compared with the third quarter of 2024. For the first nine months of 2025, amortization of tax credit and CRA investments was $58 million, an increase of $23 million or 65%, compared with the first nine months of 2024. The year-over-year increases were primarily due to the timing of tax credit investments that closed in a given period.