EAST WEST BANCORP INC
For the period ended Jun 30, 2026. Filed Aug 7, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 7, 2026
Extracted filing text, with the paragraph anchors used by the comparison.
See the whole filing, with its images and exhibitsContents
Operating Segment Results
The Company organizes its operations into three reportable operating segments: (1) Consumer and Business Banking; (2) Commercial Banking; and (3) Treasury and Other. These segments are defined based on customer type, the channels through which customers are served, and the products and services provided. For a description of the Company’s internal management reporting process, including the methodology used to allocate costs among segments, see Note 13 — Business Segments to the Consolidated Financial Statements in this Form 10-Q.
Segment net interest income represents the difference between interest earned on segment assets and interest incurred on segment liabilities, adjusted for funding charges or credits through the Company’s internal funds transfer pricing (“FTP”) process.
Consumer and Business Banking
The Consumer and Business Banking segment primarily provides financial products and services to consumer and commercial customers through the Company’s domestic branch network and digital banking platforms. This segment offers consumer and commercial deposits, mortgage and home equity loans, and other banking products and services. It also originates commercial loans for small- and medium-sized enterprises through the Company’s branch network. Additional banking products and services provided by this segment include wealth management, private banking, treasury management, interest rate risk hedging and foreign exchange services.
The following tables present financial information for the Consumer and Business Banking segment for the periods indicated:
| Three Months Ended June 30, | ||||
|---|---|---|---|---|
| ($ in thousands) | 2026 | 2025 | $ | % |
| Net interest income before provision for credit losses | $274,251 | $273,073 | $1,178 | 0% |
| Noninterest income | 38,205 | 27,729 | 10,476 | 38% |
| Total revenue before provision for credit losses | 312,456 | 300,802 | 11,654 | 4% |
| Provision for credit losses | 12,451 | 6,775 | 5,676 | 84% |
| Compensation and employee benefits | 66,704 | 58,151 | 8,553 | 15% |
| Other noninterest expense | 61,483 | 57,252 | 4,231 | 7% |
| Total noninterest expense | 128,187 | 115,403 | 12,784 | 11% |
| Segment income before income taxes | 171,818 | 178,624 | (6,806) | (4)% |
| Income tax expense | 48,150 | 50,329 | (2,179) | (4)% |
| Segment net income | $123,668 | $128,295 | $(4,627) | (4)% |
| Average loans | $21,451,804 | $20,183,539 | $1,268,265 | 6% |
| Average deposits | $36,143,674 | $32,750,578 | $3,393,096 | 10% |
| Six Months Ended June 30, | ||||
|---|---|---|---|---|
| ($ in thousands) | 2026 | 2025 | $ | % |
| Net interest income before provision for credit losses | $543,498 | $542,806 | $692 | 0% |
| Noninterest income | 78,167 | 60,014 | 18,153 | 30% |
| Total revenue before provision for credit losses | 621,665 | 602,820 | 18,845 | 3% |
| Provision for credit losses | 21,636 | 14,460 | 7,176 | 50% |
| Compensation and employee benefits | 136,800 | 120,115 | 16,685 | 14% |
| Other noninterest expense | 123,488 | 114,444 | 9,044 | 8% |
| Total noninterest expense | 260,288 | 234,559 | 25,729 | 11% |
| Segment income before income taxes | 339,741 | 353,801 | (14,060) | (4)% |
| Income tax expense | 95,209 | 102,418 | (7,209) | (7)% |
| Segment net income | $244,532 | $251,383 | $(6,851) | (3)% |
| Average loans | $21,244,542 | $19,974,077 | $1,270,465 | 6% |
| Average deposits | $35,599,069 | $32,539,912 | $3,059,157 | 9% |
Consumer and Business Banking segment net income decreased $5 million or 4%, to $124 million for the second quarter of 2026, compared with the same period in 2025. This decrease was primarily attributable to a $9 million increase in compensation and employee benefits and a $6 million increase in provision for credit losses, partially offset by a $10 million increase in noninterest income. For the first half of 2026, Consumer and Business Banking segment net income decreased $7 million or 3%, to $245 million, compared with the same period in 2025. The decrease was primarily attributable to a $17 million increase in compensation and employee benefits, a $9 million increase in other noninterest expense, and a $7 million increase in provision for credit losses, partially offset by an $18 million increase in noninterest income.
The increase in noninterest income for both the quarter and year-to-date periods was primarily due to increases in wealth management fees. The increase in the provision for credit losses in both periods was primarily driven by loan growth. The increase in compensation and employee benefits expense in both periods was primarily due to staffing growth and higher wealth management commissions, while the increase in other noninterest expense for the first half of 2026 was mainly driven by higher occupancy and equipment expense and increased allocations of corporate overhead.
Commercial Banking
The Commercial Banking segment primarily generates commercial loan and deposit products. Commercial loan products include CRE lending, construction finance, commercial business lending, working capital lines of credit, trade finance, letters of credit, affordable housing lending, asset-based lending, asset-backed finance, project finance, equipment financing, and loan syndication. Commercial deposit products and other financial services include treasury management, foreign exchange services, and interest rate and commodity risk hedging. This segment also includes the Company’s international branch activities.
The following tables present financial information for the Commercial Banking segment for the periods indicated:
| Three Months Ended June 30, | ||||
|---|---|---|---|---|
| ($ in thousands) | 2026 | 2025 | $ | % |
| Net interest income before provision for credit losses | $258,824 | $254,144 | $4,680 | 2% |
| Noninterest income | 55,560 | 49,751 | 5,809 | 12% |
| Total revenue before provision for credit losses | 314,384 | 303,895 | 10,489 | 3% |
| Provision for credit losses | 20,549 | 38,724 | (18,175) | (47)% |
| Compensation and employee benefits | 69,778 | 57,592 | 12,186 | 21% |
| Other noninterest expense | 39,151 | 36,053 | 3,098 | 9% |
| Total noninterest expense | 108,929 | 93,645 | 15,284 | 16% |
| Segment income before income taxes | 184,906 | 171,526 | 13,380 | 8% |
| Income tax expense | 51,724 | 48,319 | 3,405 | 7% |
| Segment net income | $133,182 | $123,207 | $9,975 | 8% |
| Average loans | $36,777,698 | $33,767,859 | $3,009,839 | 9% |
| Average deposits (1) | $28,658,783 | $26,315,823 | $2,342,960 | 9% |
| Six Months Ended June 30, | ||||
|---|---|---|---|---|
| ($ in thousands) | 2026 | 2025 | $ | % |
| Net interest income before provision for credit losses | $520,110 | $507,145 | $12,965 | 3% |
| Noninterest income | 109,891 | 103,330 | 6,561 | 6% |
| Total revenue before provision for credit losses | 630,001 | 610,475 | 19,526 | 3% |
| Provision for credit losses | 47,556 | 79,503 | (31,947) | (40)% |
| Compensation and employee benefits | 144,622 | 118,779 | 25,843 | 22% |
| Other noninterest expense | 75,621 | 78,371 | (2,750) | (4)% |
| Total noninterest expense | 220,243 | 197,150 | 23,093 | 12% |
| Segment income before income taxes | 362,202 | 333,822 | 28,380 | 9% |
| Income tax expense | 101,381 | 96,590 | 4,791 | 5% |
| Segment net income | $260,821 | $237,232 | $23,589 | 10% |
| Average loans | $36,400,779 | $33,490,986 | $2,909,793 | 9% |
| Average deposits (1) | $28,374,828 | $26,222,998 | $2,151,830 | 8% |
(1)Prior period balances have been reclassified for comparability due to a change in allocation methodology.
Commercial Banking segment net income increased $10 million or 8%, to $133 million for the second quarter of 2026, compared with the same period in 2025. The increase was primarily attributable to an $18 million decrease in the provision for credit losses, a $6 million increase in noninterest income and a $5 million increase in net interest income, partially offset bya $12 million increase in compensation and employee benefits, and a $3 million increase in other noninterest expense. For the first six months of 2026, Commercial Banking segment net income increased $24 million or 10%, to $261 million, compared with the same period in 2025. The increase was primarily attributable to a $32 million decrease in provision for credit losses, a $13 million increase in net interest income and a $7 million increase in noninterest income, partially offset by a $26 million increase in compensation and employee benefits expense.
The increase in net interest income for both the quarter and year -to-date periods was primarily due to lower deposit interest expense resulting from the year-over-year decline in interest rates. The decrease in the provision for credit losses in both periods was primarily driven by a more stable macroeconomic outlook for C&I loans, compared with the prior year period. The $6 million increase in noninterest income for the second quarter 2026, compared with the same period in 2025, was primarily due to higher commercial deposit-related fees, lending and loan servicing fees and wealth management fees. The $7 million noninterest income increase for the first half of 2026, compared with the same period in 2025, was primarily due to higher commercial deposit-related fees and wealth management fees. The increase in compensation and employee benefits in both the quarter and year-to-date periods was primarily driven by higher incentive compensation and staffing growth.
Treasury and Other
Centralized functions, including the Company’s corporate treasury activities, tax credit investment activities, net FTP, eliminations of inter-segment amounts, and centrally managed departments, are aggregated within the Treasury and Other segment.
The following tables present financial information for the Treasury and Other segment for the periods indicated:
| Three Months Ended June 30, | ||||
|---|---|---|---|---|
| ($ in thousands) | 2026 | 2025 | $ | % |
| Net interest income before reversal of credit losses (1) | $151,576 | $89,857 | $61,719 | 69% |
| Noninterest income | 12,727 | 8,698 | 4,029 | 46% |
| Total revenue before reversal of credit losses | 164,303 | 98,555 | 65,748 | 67% |
| Reversal of credit losses | — | (499) | 499 | NM |
| Compensation and employee benefits | 36,061 | 29,098 | 6,963 | 24% |
| Other noninterest expense | 17,445 | 17,874 | (429) | (2)% |
| Total noninterest expense | 53,506 | 46,972 | 6,534 | 14% |
| Segment income before income taxes | 110,797 | 52,082 | 58,715 | 113% |
| Income tax expense (benefit) | 3,947 | (6,669) | 10,616 | NM |
| Segment net income | $106,850 | $58,751 | $48,099 | 82% |
| Average loans (2) | $— | $330,034 | $(330,034) | (100)% |
| Average deposits (3) | $3,895,188 | $4,611,431 | $(716,243) | (16)% |
| Six Months Ended June 30, | ||||
|---|---|---|---|---|
| ($ in thousands) | 2026 | 2025 | $ | % |
| Net interest income before (reversal of) provision for credit losses (1) | $292,236 | $167,324 | $124,912 | 75% |
| Noninterest income | 20,990 | 14,936 | 6,054 | 41% |
| Total revenue before (reversal of) provision for credit losses | 313,226 | 182,260 | 130,966 | 72% |
| (Reversal of) provision for credit losses | (192) | 37 | (229) | NM |
| Compensation and employee benefits | 63,786 | 52,382 | 11,404 | 22% |
| Other noninterest expense | 26,619 | 24,077 | 2,542 | 11% |
| Total noninterest expense | 90,405 | 76,459 | 13,946 | 18% |
| Segment income before income taxes | 223,013 | 105,764 | 117,249 | 111% |
| Income tax expense (benefit) | 6,870 | (6,144) | 13,014 | NM |
| Segment net income | $216,143 | $111,908 | $104,235 | 93% |
| Average loans (2) | $— | $347,116 | $(347,116) | (100)% |
| Average deposits (3) | $4,151,918 | $4,397,671 | $(245,753) | (6)% |
(1)Primarily generated from the Company’s debt securities portfolio. Refer to Note 4 —Securitiesto the Consolidated Financial Statements and Item 2. MD&A — Balance Sheet Analysis — Debt Securities in this Form 10-Q for further information on the Company’s debt securities portfolio.
(2)Reallocated to the Commercial Banking and Consumer and Business Banking segments effective first quarter of 2026.
(3)Prior period balances have been reclassified for comparability due to a change in allocation methodology.
Treasury and Other segment income before income taxes increased $59 million for the second quarter of 2026, compared with the same period in 2025. The increase was attributable to a $62 million increase in net interest income and a $4 million increase in noninterest income, partially offset by a $7 million increase in compensation and employee benefits expense. Treasury and Other segment income before income taxes increased $117 million for the first half of 2026, compared with the same period in 2025. The increase was primarily attributable to a $125 million increase in net interest income and a $6 million increase in noninterest income, partially offset by an $11 million increase in compensation and employee benefits expense.
The increase in net interest income for both the quarterly and year-to-date periods was primarily driven by lower net internal FTP credits for deposits transferred to other business segments, higher interest income on debt securities and lower interest expense on FHLB advances. The increase in noninterest income for both periods was primarily attributable to higher other income, primarily related to bank-owned life insurance policies, and gain on sales of debt securities. The increase in compensation and employee benefits expense for both periods was primarily driven by additional employer matching contributions under the Company’s 401(k) plan, higher deferred compensation plan costs, and increased incentive compensation.
Income tax expense is allocated to the Consumer and Business Banking and the Commercial Banking segments by applying statutory income tax rates to each segment’s income before income taxes. The income tax expense or benefit in the Treasury and Other segment represents the remaining unallocated income tax expense or benefit after allocating income tax expense to the two core segments and reflects the impact of tax credit investment activities.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.