CATHAY GENERAL BANCORP

Previous wording

Net income for the three months ended June 30, 2026, was $92.2 million, an increase of $14.7 million, or 19.0% compared to net income of $77.5 million for the same period in 2025. Diluted earnings per share for the three months ended June 30, 2026, was $1.37 per share compared to $1.10 per share for the same period in 2025.

Current wording

Net income for the three months ended September 30, 2026, was $95.2 million, an increase of $17.5 million, or 22.5% compared to net income of $77.7 million for the same period in 2025. Diluted earnings per share for the three months ended September 30, 2026, was $1.43 per share compared to $1.13 per share for the same period in 2025.

Previous wording

Return on average stockholders’ equity was 12.21% and return on average assets was 1.52% for the three months ended June 30, 2026, compared to a return on average stockholders’ equity of 10.72% and a return on average assets of 1.33% for the same period in 2025.

Current wording

Return on average stockholders’ equity was 12.28% and return on average assets was 1.51% for the three months ended September 30, 2026, compared to a return on average stockholders’ equity of 10.60% and a return on average assets of 1.29% for the same period in 2025.

Previous wording

Net interest income before provision for credit losses increased $19.7 million, or 10.9%, to $200.9 million during the second quarter of 2026, compared to $181.2 million during the same quarter in 2025. The increase was primarily due to a lower interest expense on deposits, partially offset by a lower interest income on deposits with other banks.

Current wording

Net interest income before provision for credit losses increased $22.3 million, or 11.8%, to $211.9 million during the third quarter of 2026, compared to $189.6 million during the same quarter in 2025. The increase was primarily due to higher interest income from loans and investment securities and lower interest expense on deposits and advances from the FHLB.

Previous wording

The net interest margin was 3.48% for the second quarter of 2026 compared to 3.27% for the second quarter of 2025.

Current wording

The net interest margin was 3.52% for the third quarter of 2026 compared to 3.31% for the third quarter of 2025.

Previous wording

For the second quarter of 2026, the yield on average interest-earning assets was 5.66%, the cost of funds on average interest-bearing liabilities was 2.89%, and the average cost of interest-bearing deposits was 2.86%. In comparison, for the second quarter of 2025, the yield on average interest-earning assets was 5.83%, the cost of funds on average interest-bearing liabilities was 3.37%, and the average cost of interest-bearing deposits was 3.35%. The decrease in the cost on average interest-bearing liabilities resulted mainly from lower interest rates paid on deposits, while the decrease in the yield on average interest-earning assets resulted mainly from lower interest rates earned on loans. The net interest spread, defined as the difference between the yield on average interest-earning assets and the cost of funds on average interest-bearing liabilities, was 2.77% for the quarter ended June 30, 2026, compared to 2.46% for the same quarter in 2025.

Current wording

For the third quarter of 2026, the yield on average interest-earning assets was 5.74%, the cost of funds on average interest-bearing liabilities was 2.93%, and the average cost of interest-bearing deposits was 2.91%. In comparison, for the third quarter of 2025, the yield on average interest-earning assets was 5.84%, the cost of funds on average interest-bearing liabilities was 3.32%, and the average cost of interest-bearing deposits was 3.28%. The decrease in the cost on average interest-bearing liabilities was primarily attributable to lower interest rates paid on deposits. The decrease in the yield on average interest-earning assets primarily reflected lower interest rates earned on loans, partially offset by higher interest rates earned on investment securities and higher dividend income from FHLB stock. The net interest spread, defined as the difference between the yield on average interest-earning assets and the cost of funds on average interest-bearing liabilities, was 2.81% for the quarter ended September 30, 2026, compared to 2.52% for the same quarter in 2025.

Previous wording

The Company recorded a provision for credit losses of $11.2 million in the second quarter of 2026 compared to $11.2 million in the second quarter of 2025. As of June 30, 2026, the allowance for loan losses increased $23.0 million to $218.9 million, or 1.06% of total loans compared to $195.9 million, or 0.97% of total loans as of December 31, 2025.

Current wording

The Company recorded a provision for credit losses of $28.6 million in the third quarter of 2026 compared to $28.7 million in the third quarter of 2025. As of September 30, 2026, the allowance for loan losses increased $28.3 million to $224.2 million, or 1.06% of total loans compared to $195.9 million, or 0.97% of total loans as of December 31, 2025.

Previous wording

Non-interest income, which includes revenues from depository service fees, letters of credit commissions, securities gains (losses), wealth management fees, and other sources of fee income, was $21.4 million for the second quarter of 2026, an increase of $6.0 million, or 39.0%, compared to $15.4 million for the second quarter of 2025. The increase was primarily due to a $13.0 million increase in net gains from equity securities and a $3.0 million increase in wealth management fees, partially offset by a $10.6 million net loss on the sale of available-for-sale investment securities related to investment securities repositioning activities.

Current wording

Non-interest income, which includes revenues from depository service fees, letters of credit commissions, securities gains (losses), wealth management fees, and other sources of fee income, was $42.8 million for the third quarter of 2026, an increase of $21.8 million, or 103.8%, compared to $21.0 million for the third quarter of 2025. The increase was primarily driven by a $32.8 million increase in net gains from equity securities, a $3.1 million benefit from the redemption of TruPS and a $0.4 million increase in wealth management fees, partially offset by a $15.1 million net loss on the sale of available-for-sale investment securities related to investment securities repositioning activities.

Previous wording

Non-interest expense was $92.3 million for the second quarter of 2026, an increase of $3.2 million, or 3.6% compared to $89.1 million for the second quarter of 2025. The increase was primarily due to a $3.6 million increase in salaries and employee benefits, a $1.4 million increase in computer and equipment expenses, and a $0.7 million increase in other real estate owned expense, partially offset by a $1.5 million decrease in professional service expense, and a $1.3 million decrease in amortization expense of investments in low-income housing. The efficiency ratio was 41.53% in the second quarter of 2026 compared to 45.34% for the same quarter in 2025.

Current wording

Non-interest expense was $103.4 million for the third quarter of 2026, an increase of $15.3 million, or 17.4% compared to $88.1 million for the third quarter of 2025. The increase was primarily attributable to an $8.0 million charitable contribution to the Cathay Bank Foundation, a $5.4 million contract termination fee, a $4.8 million increase in salaries and employee benefits, a $1.5 million increase in computer and equipment expenses, and a $1.5 million increase in other real estate owned expense, partially offset by a $5.7 million decrease in amortization expense of investments in low-income housing. The efficiency ratio was 40.60% in the third quarter of 2026 compared to 41.84% for the same quarter in 2025.

Previous wording

The effective tax rate for the second quarter of 2026 was 22.4% compared to 19.6% for the second quarter of 2025. The effective tax rate includes the impact of low-income housing tax credits in 2025.

Current wording

The effective tax rate for the third quarter of 2026 was 22.4% compared to 17.2% for the third quarter of 2025, primarily due to the higher pre-tax income in the third quarter of 2026. The effective tax rate for the third quarter of 2026 and 2025 includes the impact of low-income housing tax credits.

Previous wording

Net income for the six months ended June 30, 2026, was $179.1 million, an increase of $32.1 million, or 21.9% compared to net income of $147.0 million for the same period in 2025. Diluted earnings per share for the six months ended June 30, 2026, was $2.66 per share compared to $2.09 per share for the same period in 2025.

Current wording

Net income for the nine months ended September 30, 2026, was $274.3 million, an increase of $49.7 million, or 22.1% compared to net income of $224.6 million for the same period in 2025. Diluted earnings per share for the nine months ended September 30, 2026, was $4.09 per share compared to $3.21 per share for the same period in 2025.

Previous wording

Return on average stockholders’ equity was 12.05% and return on average assets was 1.50% for the six months ended June 30, 2026, compared to a return on average stockholders’ equity of 10.28% and a return on average assets of 1.27% for the same period in 2025.

Current wording

Return on average stockholders’ equity was 12.13% and return on average assets was 1.50% for the nine months ended September 30, 2026, compared to a return on average stockholders’ equity of 10.39% and a return on average assets of 1.28% for the same period in 2025.

Previous wording

The following table sets forth information concerning average interest-earning assets, average interest-bearing liabilities, and the average yields earned on those assets and rates paid on those liabilities for the six months ended June 30, 2026, and 2025. The average outstanding amounts included in the table are daily averages.

Current wording

The following table sets forth information concerning average interest-earning assets, average interest-bearing liabilities, and the average yields earned on those assets and rates paid on those liabilities for the nine months ended September 30, 2026, and 2025. The average outstanding amounts included in the table are daily averages.

Previous wording

The following table summarizes the changes in interest income and interest expense attributable to changes in volume and changes in interest rates for the six months ended June 30, 2026 and 2025:

Current wording

The following table summarizes the changes in interest income and interest expense attributable to changes in volume and changes in interest rates for the nine months ended September 30, 2026 and 2025:

Previous wording

Total assets were $24.65 billion as of June 30, 2026, an increase of $423.2 million, or 1.7%, from $24.23 billion as of December 31, 2025.

Current wording

Total assets were $25.57 billion as of September 30, 2026, an increase of $1.34 billion, or 5.5%, from $24.23 billion as of December 31, 2025.

Previous wording

The carrying value of our securities available-for-sale (“AFS”) portfolio was $1.68 billion and $1.66 billion as of June 30, 2026, and December 31, 2025, respectively. The increase in the AFS securities portfolio was primarily due to a net addition of $82.9 million in treasury securities, partially offset by the amortization of existing securities during the six months ended June 30, 2026. AFS securities represented 6.8% of total assets as of both June 30, 2026, and December 31, 2025.

Current wording

The carrying value of our securities available-for-sale (“AFS”) portfolio was $1.59 billion as of September 30, 2026, a decrease of $69.2 million from $1.66 billion as of December 31, 2025. The decrease primarily reflected reductions of $122.0 million in corporate securities, $25.0 million in government sponsored entities securities and $18.5 million in collateralized mortgage obligations, partially offset by a $96.5 million increase in U.S. Treasury securities during the nine months ended September 30, 2026. AFS securities represented 6.2% and 6.8% of total assets as of September 30, 2026, and December 31, 2025, respectively.

Previous wording

The portfolio continues to be concentrated in U.S. government-backed securities, with more than 90% of the AFS investment portfolio invested in U.S. Treasuries and agency mortgage-backed securities issued by Fannie Mae and Freddie Mac with the remainder held in investment-grade securities. There was no allowance for credit losses provided against the AFS investment securities as of both June 30, 2026, and December 31, 2025. Additionally, there were no credit losses recognized in earnings during the six months ended June 30, 2026, and 2025.

Current wording

The portfolio continues to be concentrated in U.S. government-backed securities, with more than 90% of the AFS investment portfolio invested in U.S. Treasuries and agency mortgage-backed securities issued by Fannie Mae and Freddie Mac with the remainder held in investment-grade securities. There was no allowance for credit losses provided against the AFS investment securities as of both September 30, 2026, and December 31, 2025. Additionally, there were no credit losses recognized in earnings during the nine months ended September 30, 2026, and 2025.

Previous wording

During the quarter, the Company recorded a $10.6 million loss related to its decision to sell certain AFS investment securities as part of a portfolio repositioning initiative designed to improve yield while maintaining the portfolio’s overall duration and credit quality. These securities, with a book value of $160.2 million, were sold in June 2026, resulting in a realized loss of $10.6 million. The AFS portfolio had an effective duration of 2.03 years at June 30, 2026, compared to 1.9 years at December 31, 2025.

Current wording

During the quarter, the Company recorded a $15.1 million loss related to its decision to sell certain AFS investment securities as part of a portfolio repositioning initiative designed to improve yield while maintaining the portfolio’s overall duration and credit quality. These securities, with an amortized cost basis of $89.8 million, were sold in September 2026, resulting in a realized loss of $15.1 million. The AFS portfolio had an effective duration of 2.03 years at September 30, 2026, compared to 1.9 years at December 31, 2025.

Previous wording

Gross loans held for investment were $20.62 billion at June 30, 2026, an increase of $474.1 million, or 2.4%, from $20.15 billion at December 31, 2025. The increase was primarily due to an increase of $340.4 million, or 10.7%, in commercial loans, an increase of $214.6 million, or 2.0%, in commercial real estate loans, and an increase of $7.8 million, or 3.5%, in equity lines, partially offset by a decrease of $89.2 million, or 26.4% in construction loans.

Current wording

Gross loans held for investment were $21.20 billion at September 30, 2026, an increase of $1.05 billion, or 5.2%, from $20.15 billion at December 31, 2025. The increase was primarily due to an increase of $760.8 million, or 23.9%, in commercial loans, an increase of $280.0 million, or 2.7%, in commercial real estate loans, an increase of $74.7 million, or 1.2% in residential mortgage loans and equity lines, and an increase of $4.7 million, or 261.1% in installment and other loans, partially offset by a decrease of $71.7 million, or 21.2% in construction loans.

Previous wording

The ratio of non-performing assets to total assets was 0.59% as of June 30, 2026, and December 31, 2025. Total non-performing assets increased $1.7 million, or 1.2%, to $145.4 million at June 30, 2026, compared to $143.7 million at December 31, 2025, primarily due to an increase of $3.3 million, or 11.0%, in other real estate owned, partially offset by a decrease of $1.0 million, or 100.0%, in accruing loans past due 90 days or more, and a decrease of $0.7 million, or 0.6%, in non-accrual loans.

Current wording

The ratio of non-performing assets to total assets was 0.47% and 0.59% as of September 30, 2026, and December 31, 2025, respectively. Total non-performing assets decreased $24.5 million, or 17.0%, to $119.2 million at September 30, 2026, compared to $143.7 million at December 31, 2025, primarily due to a decrease of$25.1 million, or 22.3%, in non-accrual loans, and a decrease of $3.4 million, or 11.3%, in other real estate owned, partially offset by an increase of$4.0 million, or 399.4%, in accruing loans past due 90 days or more.

Previous wording

As a percentage of gross loans, excluding loans held for sale, plus OREO, non-performing assets were 0.71% as of both June 30, 2026 and December 31, 2025. The non-performing loan portfolio coverage ratio, defined as the allowance for credit losses to non-performing loans, increased to 209.33% as of June 30, 2026, from 183.79% as of December 31, 2025.

Current wording

As a percentage of gross loans, excluding loans held for sale, plus OREO, non-performing assets were 0.56% and 0.71% as of September 30, 2026 and December 31, 2025, respectively. The non-performing loan portfolio coverage ratio, defined as the allowance for credit losses to non-performing loans, increased to 256.99% as of September 30, 2026, from 183.79% as of December 31, 2025.

Previous wording

As of June 30, 2026, total non-accrual loans were $111.7 million, a decrease of $0.7 million, or 0.6%, from $112.4 million at December 31, 2025, and a decrease of $62.5 million, or 35.9%, from $174.2 million at June 30, 2025. The allowance for the collateral-dependent loans is calculated based on the difference between the outstanding loan balance and the value of the collateral as determined by recent appraisals, sales contracts, or other available market price information, less cost to sell. The allowance for collateral-dependent loans varies from loan to loan based on the collateral coverage of the loan at the time of designation as non-performing. We continue to monitor the collateral coverage of these loans, based on recent appraisals, on a quarterly basis and adjust the allowance accordingly.

Current wording

As of September 30, 2026, total non-accrual loans were $87.3 million, a decrease of $25.1 million, or 22.3%, from $112.4 million at December 31, 2025, and a decrease of $78.3 million, or 47.3%, from $165.6 million at September 30, 2025. The allowance for the collateral-dependent loans is calculated based on the difference between the outstanding loan balance and the value of the collateral as determined by recent appraisals, sales contracts, or other available market price information, less cost to sell. The allowance for collateral-dependent loans varies from loan to loan based on the collateral coverage of the loan at the time of designation as non-performing. We continue to monitor the collateral coverage of these loans, based on recent appraisals, on a quarterly basis and adjust the allowance accordingly.

Previous wording

For non-accrual loans, amounts previously charged-off represented 6.3% and 14.4% of the contractual balances of non-accrual loans as of June 30, 2026 and December 31, 2025, respectively. As of June 30, 2026, $103.2 million, or 92.4%, of the $111.7 million of non-accrual loans were secured by real estate compared to $90.9 million, or 80.8%, of the $112.4 million of non-accrual loans that were secured by real estate as of December 31, 2025. The Bank generally seeks to obtain current appraisals, sales contracts, or other available market price information to update the factors used in evaluating potential losses.

Current wording

For non-accrual loans, amounts previously charged-off represented 5.0% and 14.4% of the contractual balances of non-accrual loans as of September 30, 2026 and December 31, 2025, respectively. As of September 30, 2026, $80.1 million, or 91.8%, of the $87.3 million of non-accrual loans were secured by real estate compared to $90.9 million, or 80.8%, of the $112.4 million of non-accrual loans that were secured by real estate as of December 31, 2025. The Bank generally seeks to obtain current appraisals, sales contracts, or other available market price information to update the factors used in evaluating potential losses.

Previous wording

The allowance for loan losses to non-performing loans was 195.97% as of June 30, 2026, compared to 172.82% as of December 31, 2025. The increase was primarily due to an increase in the allowance for loan losses and a decrease in non-accrual loans.

Current wording

The allowance for loan losses to non-performing loans was 242.97% as of September 30, 2026, compared to 172.82% as of December 31, 2025. The increase was primarily due to an increase in the allowance for loan losses and a decrease in non-accrual loans.

Previous wording

As of June 30, 2026, construction loans of $227.5 million were disbursed with pre-established interest reserves of $44.1 million, compared to $225.9 million with pre-established interest reserves of $34.0 million at December 31, 2025. There were no balances on construction loans with pre-established interest reserves that had been extended as of June 30, 2026, compared to a balance of $3.3 million of such loans with pre-established interest reserves of $95 thousand at December 31, 2025. Land loans of $20.4 million were disbursed with pre-established interest reserves of $1.3 million at June 30, 2026, compared to land loans of $15.3 million with pre-established interest reserves of $1.3 million at December 31, 2025. There were no land loans with interest reserves that had been extended as of June 30, 2026, and December 31, 2025.

Current wording

As of September 30, 2026, construction loans of $252.9 million were disbursed with pre-established interest reserves of $43.5 million, compared to $225.9 million with pre-established interest reserves of $34.0 million at December 31, 2025. The balance for construction loans with interest reserves which have been extended was $8.1 million with pre-established interest reserves of $0.6 million at September 30, 2026, compared to a balance of $3.3 million of such loans with pre-established interest reserves of $95 thousand at December 31, 2025. Land loans of $21.6 million were disbursed with pre-established interest reserves of $1.0 million at September 30, 2026, compared to land loans of $15.3 million with pre-established interest reserves of $1.3 million at December 31, 2025. There were no land loans with interest reserves that had been extended as of September 30, 2026, and December 31, 2025.

Previous wording

Most of the Company’s business activities are with clients located in areas with significant Asian populations in Southern and Northern California; New York City, New York; Dallas and Houston, Texas; Seattle, Washington; Boston, Massachusetts; Chicago, Illinois; Edison, New Jersey; Rockville, Maryland; and Las Vegas, Nevada. The Company also has loan clients in Hong Kong. The Company does not have a significant concentration in any single commercial industry section, and our loans generally are collateralized with real property or other pledged collateral of the borrowers. The Company generally expects loans to be paid off from the operating profits of the borrowers, through refinancing by another lender, or through the borrowers' sales of collateral.

Current wording

Most of the Company’s business activities are with clients located in areas with significant Asian populations in Southern and Northern California; New York City, New York; Dallas and Houston, Texas; Seattle, Washington; Boston, Massachusetts; Chicago, Illinois; Edison, New Jersey; Rockville, Maryland; and Las Vegas, Nevada. The Company also has loan clients in Hong Kong. The Company does not have a significant concentration in any single commercial industry sector, and our loans generally are collateralized with real property or other pledged collateral of the borrowers. The Company generally expects loans to be paid off from the operating profits of the borrowers, through refinancing by another lender, or through the borrowers' sales of collateral.

Previous wording

The federal banking regulatory agencies issued final guidance on December 6, 2006, regarding risk management practices for financial institutions with high or increasing concentrations of commercial real estate (“CRE”) loans on their balance sheets. The regulatory guidance reiterates the need for sound internal risk management practices for those institutions that have experienced rapid growth in CRE lending, have notable exposure to specific types of CRE, or are approaching or exceeding the supervisory criteria used to evaluate the CRE concentration risk, but the guidance is not to be construed as a limit for CRE exposure. The supervisory criteria are: (1) total reported loans for construction, land development, and other land represent 100% of the institution’s total risk-based capital, and (2) total CRE loans represent 300% or more of the institution’s total risk-based capital, and the institution’s CRE loan portfolio has increased 50% or more within the last thirty-six months. The Bank’s loans for construction, land development, and other land represented 10% of the Bank’s total risk-based capital as of June 30, 2026, and 14% as of December 31, 2025. Total CRE loans represented 277% of total risk-based capital as of June 30, 2026, and 287% as of December 31, 2025, which were within the Bank’s internal limit of 400%, of total capital.

Current wording

The federal banking regulatory agencies issued final guidance on December 6, 2006, regarding risk management practices for financial institutions with high or increasing concentrations of commercial real estate (“CRE”) loans on their balance sheets. The regulatory guidance reiterates the need for sound internal risk management practices for those institutions that have experienced rapid growth in CRE lending, have notable exposure to specific types of CRE, or are approaching or exceeding the supervisory criteria used to evaluate the CRE concentration risk, but the guidance is not to be construed as a limit for CRE exposure. The supervisory criteria are: (1) total reported loans for construction, land development, and other land represent 100% of the institution’s total risk-based capital, and (2) total CRE loans represent 300% or more of the institution’s total risk-based capital, and the institution’s CRE loan portfolio has increased 50% or more within the last thirty-six months. The Bank’s loans for construction, land development, and other land represented 11% of the Bank’s total risk-based capital as of September 30, 2026, and 14% as of December 31, 2025. Total CRE loans represented 284% of total risk-based capital as of September 30, 2026, and 287% as of December 31, 2025, which were within the Bank’s internal limit of 400% of total capital.

Previous wording

The Company focuses on providing financing to experienced real estate investors and developers who have moderate levels of leverage, many of whom are long-time customers of the Bank. CRE loans totaled $7.83 billion as of June 30, 2026, compared to $7.61 billion as of December 31, 2025, and accounted for 38% of total loans held-for-investment, not including loans held for sale, as of June 30, 2026, and December 31, 2025. Interest rates on CRE loans may be fixed or variable. As of June 30, 2026, 22% and 39% of our CRE portfolio were variable rate and hybrid loans in their fixed period, respectively. In comparison, as of December 31, 2025, 21% and 40% of our CRE portfolio were variable rate and hybrid loans in their fixed period, respectively. Loans are underwritten with conservative standards for cash flows, debt service coverage and LTV.

Current wording

The Company focuses on providing financing to experienced real estate investors and developers who have moderate levels of leverage, many of whom are long-time customers of the Bank. CRE loans totaled $7.86 billion as of September 30, 2026, compared to $7.61 billion as of December 31, 2025, and accounted for 37% of total loans held-for-investment, not including loans held for sale, as of September 30, 2026, and December 31, 2025. Interest rates on CRE loans may be fixed or variable. As of September 30, 2026, 24% and 37% of our CRE portfolio were variable rate and hybrid loans in their fixed period, respectively. In comparison, as of December 31, 2025, 21% and 40% of our CRE portfolio were variable rate and hybrid loans in their fixed period, respectively. Loans are underwritten with conservative standards for cash flows, debt service coverage and LTV.

Previous wording

Owner-occupied properties comprised 26% of the CRE loans as of June 30, 2026, and December 31, 2025. The remainder were non-owner-occupied properties, where 50% or more of the debt service for the loan is typically provided by rental income from an unaffiliated third party.

Current wording

Owner-occupied properties comprised 26% and 25% of the CRE loans as of September 30, 2026, and December 31, 2025, respectively. The remainder were non-owner-occupied properties, where 50% or more of the debt service for the loan is typically provided by rental income from an unaffiliated third party.

Previous wording

The multifamily residential loan portfolio is largely comprised of loans secured by residential properties with five or more units. Multifamily residential loans totaled $2.88 billion as of June 30, 2026, compared to $2.89 billion as of December 31, 2025, and accounted for 14% of total loans held-for-investment, not including loans held for sale, as of June 30, 2026, and December 31, 2025. The Company offers a variety of first lien mortgages, including fixed and variable-rate loans. As of June 30, 2026, 23% and 37% of our multifamily residential loan portfolio were variable rate and hybrid loans in their fixed period, respectively. In comparison, as of December 31, 2025, 24% and 36% of our multifamily residential loan portfolio were variable rate and hybrid loans in their fixed period, respectively.

Current wording

The multifamily residential loan portfolio is largely comprised of loans secured by residential properties with five or more units. Multifamily residential loans totaled $2.92 billion as of September 30, 2026, compared to $2.89 billion as of December 31, 2025, and accounted for 14% of total loans held-for-investment, not including loans held for sale, as of September 30, 2026, and December 31, 2025. The Company offers a variety of first lien mortgages, including fixed and variable-rate loans. As of September 30, 2026, 28% and 35% of our multifamily residential loan portfolio were variable rate and hybrid loans in their fixed period, respectively. In comparison, as of December 31, 2025, 24% and 36% of our multifamily residential loan portfolio were variable rate and hybrid loans in their fixed period, respectively.

Previous wording

Construction and land loans provide financing for diversified projects by real estate property type. Construction and land loans totaled $310.4 million as of June 30, 2026, compared to $408.0 million as of December 31, 2025, and accounted for 2% of total loans held-for-investment, not including loans held for sale, as of June 30, 2026, and December 31, 2025. Construction loan exposure was made up of $248.4 million in outstanding loans, plus $269.0 million in unfunded commitments as of June 30, 2026, compared to $337.6 million in outstanding loans, plus $235.3 million in unfunded commitments as of December 31, 2025. Land loans totaled $62.0 million as of June 30, 2026, compared to $70.4 million as of December 31, 2025.

Current wording

Construction and land loans provide financing for diversified projects by real estate property type. Construction and land loans totaled $331.4 million as of September 30, 2026, compared to $408.0 million as of December 31, 2025, and accounted for 2% of total loans held-for-investment, not including loans held for sale, as of September 30, 2026, and December 31, 2025. Construction loan exposure was made up of $265.9 million in outstanding loans, plus $289.8 million in unfunded commitments as of September 30, 2026, compared to $337.6 million in outstanding loans, plus $235.3 million in unfunded commitments as of December 31, 2025. Land loans totaled $65.5 million as of September 30, 2026, compared to $70.4 million as of December 31, 2025.

Previous wording

To illustrate the sensitivity of the allowance to changes in economic assumptions, management estimates that applying a 100% weighting to the downside scenario would have increased the ACL by approximately $72.1 million as of June 30, 2026. This analysis is intended to demonstrate the directional impact of more adverse economic conditions and should not be interpreted as a forecast of future allowance levels.

Current wording

To illustrate the sensitivity of the allowance to changes in economic assumptions, management estimates that applying a 100% weighting to the downside scenario would have increased the ACL by approximately $105.6 million as of September 30, 2026. This analysis is intended to demonstrate the directional impact of more adverse economic conditions and should not be interpreted as a forecast of future allowance levels.

Previous wording

Total deposits were $21.06 billion as of June 30, 2026, an increase of $167.5 million, or 0.8% from $20.89 billion as of December 31, 2025.

Current wording

Total deposits were $21.83 billion as of September 30, 2026, an increase of $940.8 million, or 4.5% from $20.89 billion as of December 31, 2025.

Previous wording

The Company calculates its uninsured deposits based on the methodologies and assumptions used for regulatory reporting. Total uninsured deposits were $10.39 billion as of June 30, 2026, an increase of approximately $199.5 million, from $10.19 billion as of December 31, 2025. Excluding $847.3 million in collateralized deposits, the uninsured and uncollateralized deposits of $9.55 billion were 45.3% of total deposits as of June 30, 2026. As of June 30, 2026, our unused borrowing capacity from the Federal Home Loan Bank was $7.05 billion, and our unpledged securities were $1.66 billion. These sources of available liquidity, including cash and short-term investments, were more than 100% of uninsured and uncollateralized deposits as of June 30, 2026.

Current wording

The Company calculates its uninsured deposits based on the methodologies and assumptions used for regulatory reporting. Total uninsured deposits were $10.26 billion as of September 30, 2026, an increase of approximately $63.2 million, from $10.19 billion as of December 31, 2025. Excluding $797.4 million in collateralized deposits, the uninsured and uncollateralized deposits of $9.46 billion were 43.3% of total deposits as of September 30, 2026. As of September 30, 2026, our unused borrowing capacity from the Federal Home Loan Bank was $7.02 billion, and our unpledged securities were $1.57 billion. These sources of available liquidity, including cash and short-term investments, were more than 100% of uninsured and uncollateralized deposits as of September 30, 2026.

Previous wording

Total equity was $3.05 billion as of June 30, 2026, an increase of $121.2 million, from $2.93 billion as of December 31, 2025, primarily due to net income of $179.1 million, other comprehensive income of $16.1 million, stock-based compensation of $3.9 million, stock issued to directors of $0.9 million, and proceeds from dividend reinvestment of $1.3 million, offset by common stock cash dividends of $50.9 million, purchase of treasury stock of $26.8 million and shares withheld related to net share settlement of RSUs of $2.4 million.

Current wording

Total stockholders' equity was $3.06 billion as of September 30, 2026, an increase of $131.4 million, from $2.93 billion as of December 31, 2025, primarily due to net income of $274.3 million, other comprehensive income of $5.9 million, stock-based compensation of $5.8 million, proceeds from dividend reinvestment of $2.0 million, and stock issued to directors of $0.9 million, offset by purchase of treasury stock of $77.5 million, common stock cash dividends of $76.1 million, and shares withheld related to net share settlement of RSUs of $3.9 million.

Previous wording

The following table summarizes changes in total equity for the six months ended June 30, 2026:

Current wording

The following table summarizes changes in total equity for the nine months ended September 30, 2026:

Previous wording

As of June 30, 2026, capital levels at Bancorp and the Bank exceed all capital adequacy requirements under the fully phased-in Basel III Capital Rules. Based on the ratios presented above, capital levels as of June 30, 2026, at Bancorp and the Bank exceed the minimum levels necessary to be considered “well capitalized.”

Current wording

As of September 30, 2026, capital levels at Bancorp and the Bank exceed all capital adequacy requirements under the fully phased-in Basel III Capital Rules.

Previous wording

The Company declared a cash dividend of $0.38 per share on 66,951,215 shares outstanding on May 28, 2026, for distribution to holders of our common stock on June 9, 2026. The Company paid total cash dividends of $25.4 million in the second quarter of 2026.

Current wording

The Company declared a cash dividend of $0.38 per share on 66,334,489 shares outstanding on August 28, 2026, for distribution to holders of our common stock on September 8, 2026. The Company paid total cash dividends of $25.2 million in the third quarter of 2026.

Previous wording

Liquidity is our ability to maintain sufficient cash flow to meet maturing financial obligations and client credit needs, and to take advantage of investment opportunities as they are presented in the marketplace. Our principal sources of liquidity are growth in deposits, proceeds from the maturity or sale of securities and other financial instruments, repayments from securities and loans, Federal funds purchased, securities sold under agreements to repurchase, and advances from the FHLB. As of June 30, 2026, our average monthly liquidity ratio (defined as net cash plus short-term and marketable securities to net deposits and short-term liabilities) was 14.2% compared to 14.7% as of December 31, 2025.

Current wording

Liquidity is our ability to maintain sufficient cash flow to meet maturing financial obligations and client credit needs, and to take advantage of investment opportunities as they are presented in the marketplace. Our principal sources of liquidity are growth in deposits, proceeds from the maturity or sale of securities and other financial instruments, repayments from securities and loans, Federal funds purchased, securities sold under agreements to repurchase, and advances from the FHLB. As of September 30, 2026, our average monthly liquidity ratio (defined as net cash plus short-term and marketable securities to net deposits and short-term liabilities) was 15.1% compared to 14.7% as of December 31, 2025.

Previous wording

The Bank is a shareholder of the FHLB, which enables the Bank to have access to lower-cost FHLB financing when necessary. At June 30, 2026, the Bank had an approved credit line with the FHLB of San Francisco totaling $8.41 billion. There were no outstanding advances from the FHLB of San Francisco and there were $865.9 million in standby letters of credit issued by the FHLB on the Company’s behalf as of June 30, 2026. FHLB advances, if any, bear fixed rates and are secured by the Bank’s loans. See Note 8 to the Consolidated Financial Statements. At June 30, 2026, the Bank pledged $1.32 billion of its commercial loans and no securities to the Federal Reserve Bank’s Discount Window under the Borrower-in-Custody program. The Bank had borrowing capacity of $1.22 billion from the Federal Reserve Bank Discount Window at June 30, 2026.

Current wording

The Bank is a shareholder of the FHLB, which enables the Bank to have access to lower-cost FHLB financing when necessary. At September 30, 2026, the Bank had an approved credit line with the FHLB of San Francisco totaling $8.62 billion. There were $200.0 million in outstanding advances from the FHLB of San Francisco and there were $842.9 million in standby letters of credit issued by the FHLB on the Company’s behalf as of September 30, 2026. FHLB advances, if any, bear fixed rates and are secured by the Bank’s loans. See Note 8 to the Consolidated Financial Statements. At September 30, 2026, the Bank pledged $1.27 billion of its commercial loans and no securities to the Federal Reserve Bank’s Discount Window under the Borrower-in-Custody program. The Bank had borrowing capacity of $1.17 billion from the Federal Reserve Bank Discount Window at September 30, 2026.

Previous wording

Liquidity can also be provided through the sale of liquid assets, which may consist of federal funds sold, securities purchased under agreements to resell, and securities available-for-sale. At June 30, 2026, investment securities totaled $1.68 billion, with $19.4 million pledged as collateral for borrowings and other commitments. The remaining balance was available as additional liquidity or to be pledged as collateral for additional borrowings.

Current wording

Liquidity can also be provided through the sale of liquid assets, which may consist of federal funds sold, securities purchased under agreements to resell, and securities available-for-sale. At September 30, 2026, investment securities totaled $1.59 billion, with $19.7 million pledged as collateral for borrowings and other commitments. The remaining balance was available as additional liquidity or to be pledged as collateral for additional borrowings.