Business Wire | Jan 27, 2022 04:30PM EST

Cathay General Bancorp Announces Fourth Quarter and Full Year 2021 Results

Jan. 27, 2022

LOS ANGELES--(BUSINESS WIRE)--Jan. 27, 2022--Cathay General Bancorp (the "Company", "we", "us", or "our"; NASDAQ: CATY), the holding company for Cathay Bank, today announced its unaudited financial results for the quarter and year ended December 31, 2021. The Company reported net income of $75.3 million, or $0.98 per share, for the fourth quarter of 2021, and net income of $298.3 million, or $3.80 per share, for the year ended December 31, 2021.

FINANCIAL PERFORMANCE

Three months ended Year ended December 31,(unaudited) December September December 2021 2020 31, 2021 30, 2021 31, 2021 $75.3 $72.4 $70.9 $298.3 $228.9Net income million million million million million

Basic earnings per $0.98 $0.93 $0.89 $3.81 $2.88common shareDiluted earnings per $0.98 $0.93 $0.89 $3.80 $2.87common shareReturn on average assets 1.48% 1.45% 1.50% 1.52% 1.22%

Return on average total 12.12% 11.61% 11.75% 12.11% 9.70%stockholders' equityEfficiency ratio 41.77% 43.85% 49.61% 43.92% 47.65%

HIGHLIGHTS

* Record net income of $298.3 million and EPS of $3.80 per share in 2021. * Quarterly earnings per share increased 10.1% compared to same quarter in 2020. * Total loans, excluding Paycheck Protection Program ("PPP") loans, increased by $444.6 million or 11.4% annualized, in the fourth quarter. * Total deposits for the quarter increased $1.1 billion, or 24.7% annualized. * Total deposits, excluding time deposits, increased for the year by $3.1 billion, or 33.0%, to $12.5 billion from $9.4 billion in 2020.

"For the fourth quarter of 2021, total loans, excluding PPP loans, increased by $444.6 million, or 11.4% annualized. During 2021, we repurchased 3,986,057 shares at an average cost of $41.92 per share, for a total of $167.1 million as of December 31, 2021," commented Chang M. Liu, President and Chief Executive Officer of the Company.

FOURTH QUARTER INCOME STATEMENT REVIEW

Net income for the quarter ended December 31, 2021, was $75.3 million, an increase of $4.4 million, or 6.3%, compared to net income of $70.9 million for the same quarter a year ago. Diluted earnings per share for the quarter ended December 31, 2021, increased by 10.1%, or $0.98 per share, compared to $0.89 per share for the same quarter a year ago.

Net interest income before provision for credit losses

Net interest income before provision for credit losses increased $15.6 million, or 11.2%, to $155.5 million during the fourth quarter of 2021, compared to $139.8 million during the same quarter a year ago. The increase was due primarily to a decrease in interest expense from deposits and an increase in interest income from loans and securities.

The net interest margin was 3.23% for the fourth quarter of 2021 compared to 3.12% for the fourth quarter of 2020 and 3.22% for the third quarter of 2021.

For the fourth quarter of 2021, the yield on average interest-earning assets was 3.52%, the cost of funds on average interest-bearing liabilities was 0.41%, and the cost of interest-bearing deposits was 0.37%. In comparison, for the fourth quarter of 2020, the yield on average interest-earning assets was 3.74%, the cost of funds on average interest-bearing liabilities was 0.86%, and the cost of interest-bearing deposits was 0.80%. The decrease in the yield on interest-bearing liabilities resulted mainly from lower interest rates on deposits driven by the lower repricing of maturing time deposits in the fourth quarter. The decrease in the yield on average interest-earning assets resulted mainly from lower interest rates on loans due to the lower rate environment.

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 3.11% for the quarter ended December 31, 2021, compared to 2.88% for the same quarter a year ago.

Provision/Reversal for credit losses

As permitted under the Coronavirus, Aid, Relief and Economic Security Act (the "CARES Act") and as extended by the Consolidated Appropriations Act, 2021, the Company adopted the Current Expected Credit Losses ("CECL") methodology for estimated credit losses effective as of January 1, 2021. The Company recorded a provision for credit losses of $3.5 million in the fourth quarter of 2021 compared with $3.1 million in the third quarter of 2021 and reversal for credit losses of $5.0 million in the fourth quarter of 2020. The fourth quarter provision for credit losses was primarily driven by loan growth. As of December 31, 2021, the allowance for loan losses increased by $4.2 million to $136.2 million, or 0.83% of gross loans, compared to $131.9 million, or 0.83% of gross loans as of September 31, 2021. The change in the allowance for loan losses during the fourth quarter of 2021 included a $4.5 million provision for loan losses, and $287.7 thousand in net charge-offs. The Company will continue to monitor the continuing impact of the COVID-19 pandemic on credit risks and losses, as well as on customer deposits and other liabilities and assets.

The following table sets forth the charge-offs and recoveries for the periods indicated:

Three months ended Year ended December 31, December September December 2021 2020 31, 2021 30, 2021 31, 2020 (In thousands) (Unaudited)

Charge-offs: Commercial loans $ 552 $ 2,649 $ 8,613 $ 20,051 $ 21,996

Real estate loans ^ - 3 - 3 -(1)Total charge-offs 552 2,652 8,613 20,054 21,996

Recoveries: Commercial loans 160 121 912 1,706 7,267

Construction loans - 76 - 76 -

Real estate loans^ 104 144 109 661 543(1)Total recoveries 264 341 1,021 2,443 7,810

Net charge-offs $ 288 $ 2,311 $ 7,592 $ 17,611 $ 14,186

(1) Real estate loans include commercial mortgage loans, residential mortgage loans, and equity lines. Non-interest income

Non-interest income, which includes revenues from depository service fees, letters of credit commissions, securities gains (losses), wire transfer fees, and other sources of fee income, was $19.8 million for the fourth quarter of 2021, an increase of $8.4 million, or 73.0%, compared to $11.5 million for the fourth quarter of 2020. The increase was primarily due to a $3.7 million gain on distribution from venture capital investments, a $2.5 million increase in derivative fees, and $1.4 million increase in wealth management fees, when compared to the same quarter a year ago.

Non-interest expense

Non-interest expense decreased $1.8 million, or 2.5%, to $73.2 million in the fourth quarter of 2021 compared to $75.0 million in the same quarter a year ago. The decrease in non-interest expense in the fourth quarter of 2021 was primarily due to a decrease of $4.4 million in amortization expense of investments in low-income housing and alternative energy partnerships offset, in part, by an increase of $2.3 million in salaries and employee benefits and an increase of $1.0 million in acquisition, integration and reorganization costs, when compared to the fourth quarter of 2020. The efficiency ratio, defined as non-interest expense divided by the sum of net interest income before provision for loan losses plus non-interest income was 41.8% in the fourth quarter of 2021 compared to 49.6% for the same quarter a year ago.

Income taxes

The effective tax rate for the fourth quarter of 2021 was 23.6% compared to 12.7% for the fourth quarter of 2020. The effective tax rate includes the impact of alternative energy investments and low-income housing tax credits.

BALANCE SHEET REVIEW

Gross loans were $16.3 billion at December 31, 2021, an increase of $698.1 million, or 4.5%, from $15.6 billion at December 31, 2020. The increase was primarily due to increases of $588.2 million, or 7.8%, in commercial mortgage loans, $296.0 million, or 11.4%, in commercial loans, not including PPP loans, and an increase of $36.6 million, or 0.9%, in residential mortgage loans, offset, in part, by a decrease of $150.4 million, or 62.4%, in PPP loans, and $68.5 million, or 10.1%, in real estate construction loans. For the fourth quarter of 2021, total loans, excluding PPP loans, increased by $444.6 million, or 11.4% annualized. Loan fees recognized on PPP loans were $2.3 million in the fourth quarter of 2021 compared to $5.8 million in the third quarter, $2.7 million in second quarter and $2.5 million in the first quarter of 2021. As of December 31, 2021, the remaining deferred loan fees on PPP loans was $643.0 thousand.

The loan balances and composition as of December 31, 2021, compared to September 30, 2021 and December 31, 2020, are presented below:

(1) Real estate loans include commercial mortgage loans, residential mortgageloans, and equity lines. Non-interest income

Non-interest income, which includes revenues from depository service fees, letters of credit commissions, securities gains (losses), wire transfer fees, and other sources of fee income, was $19.8 million for the fourth quarter of 2021, an increase of $8.4 million, or 73.0%, compared to $11.5 million for the fourth quarter of 2020. The increase was primarily due to a $3.7 million gain on distribution from venture capital investments, a $2.5 million increase in derivative fees, and $1.4 million increase in wealth management fees, when compared to the same quarter a year ago.

Non-interest expense

Non-interest expense decreased $1.8 million, or 2.5%, to $73.2 million in the fourth quarter of 2021 compared to $75.0 million in the same quarter a year ago. The decrease in non-interest expense in the fourth quarter of 2021 was primarily due to a decrease of $4.4 million in amortization expense of investments in low-income housing and alternative energy partnerships offset, in part, by an increase of $2.3 million in salaries and employee benefits and an increase of $1.0 million in acquisition, integration and reorganization costs, when compared to the fourth quarter of 2020. The efficiency ratio, defined as non-interest expense divided by the sum of net interest income before provision for loan losses plus non-interest income was 41.8% in the fourth quarter of 2021 compared to 49.6% for the same quarter a year ago.

Income taxes

The effective tax rate for the fourth quarter of 2021 was 23.6% compared to 12.7% for the fourth quarter of 2020. The effective tax rate includes the impact of alternative energy investments and low-income housing tax credits.

BALANCE SHEET REVIEW

Gross loans were $16.3 billion at December 31, 2021, an increase of $698.1 million, or 4.5%, from $15.6 billion at December 31, 2020. The increase was primarily due to increases of $588.2 million, or 7.8%, in commercial mortgage loans, $296.0 million, or 11.4%, in commercial loans, not including PPP loans, and an increase of $36.6 million, or 0.9%, in residential mortgage loans, offset, in part, by a decrease of $150.4 million, or 62.4%, in PPP loans, and $68.5 million, or 10.1%, in real estate construction loans. For the fourth quarter of 2021, total loans, excluding PPP loans, increased by $444.6 million, or 11.4% annualized. Loan fees recognized on PPP loans were $2.3 million in the fourth quarter of 2021 compared to $5.8 million in the third quarter, $2.7 million in second quarter and $2.5 million in the first quarter of 2021. As of December 31, 2021, the remaining deferred loan fees on PPP loans was $643.0 thousand.

The loan balances and composition as of December 31, 2021, compared to September 30, 2021 and December 31, 2020, are presented below:

December 31, September 30, December 31, 2021 2021 2020 (In thousands) (Unaudited)Commercial loans $ 2,891,914 $ 2,702,333 $ 2,595,926

Paycheck protection program 90,485 169,360 240,907 loansResidential mortgage loans 4,182,006 4,144,789 4,145,389

Commercial mortgage loans 8,143,272 7,835,528 7,555,027

Equity lines 419,487 433,206 424,555

Real estate construction 611,031 688,195 679,492 loansInstallment and other loans 4,284 3,370 3,100

Gross loans $ 16,342,479 $ 15,976,781 $ 15,644,396

Allowance for loan losses (136,157 ) (131,945 ) (166,538 )

Unamortized deferred loan (4,321 ) (3,835 ) (2,494 )feesTotal loans, net $ 16,202,001 $ 15,841,001 $ 15,475,364

Total deposits were $18.1 billion as of December 31, 2021, an increase of $1.9 billion, or 12.1%, from $16.1 billion as of December 31, 2020. The increases in noninterest-bearing demand deposits, NOW deposits, money market deposits and savings deposits resulted from higher liquidity maintained by our depositors during these uncertain times and improved money market deposit generation from corporate accounts. The decreases in time deposits resulted primarily from the runoff of wholesale time deposits.

The deposit balances and composition as of December 31, 2021, compared to September 30, 2021 and December 31, 2020, are presented below:

December 31, September 30, December 31, 2021 2021 2020

(In thousands) (Unaudited)Non-interest-bearing demand $ 4,492,054 $ 4,024,504 $ 3,365,086depositsNOW deposits 2,522,442 2,202,956 1,926,135

Money market deposits 4,611,579 4,132,912 3,359,191

Savings deposits 915,515 920,138 785,672

Time deposits 5,517,252 5,726,360 6,673,317

Total deposits $ 18,058,842 $ 17,006,870 $ 16,109,401

As a result of the 12.1% increase in deposits year over year, our loan to deposits ratio decreased from 96% to 90%. As the majority of the increase was in non-CD deposits, our asset liability sensitivity has become more asset sensitive during 2021.

ASSET QUALITY REVIEW

As of December 31, 2021, total non-accrual loans were $65.8 million, a decrease of $1.8 million, or 2.7%, from $67.7 million as of December 31, 2020, and a decrease of $2.8 million, or 4.1%, from $68.7 million as of September 30, 2021.

The allowance for loan losses was $136.2 million and the allowance for off-balance sheet unfunded credit commitments was $7.1 million as of December 31, 2021. The allowances represent the amount estimated by management to be appropriate to absorb credit losses inherent in the loan portfolio, including unfunded credit commitments. The allowance for loan losses represented 0.83% of period-end gross loans, and 202.4% of non-performing loans as of December 31, 2021. The comparable ratios were 1.06% of period-end gross loans, and 229.18% of non-performing loans as of December 31, 2020.

The changes in non-performing assets and troubled debt restructurings as of December 31, 2021, compared to December 31, 2020 and September 30, 2021, are presented below:

(Dollars in December 31, December 31, % September 30, %thousands) 2021 2020 Change 2021 Change(Unaudited)Non-performing assetsAccruing loans $ 1,439 $ 4,982 (71 ) $ 4,333 (67 )past due 90 days or moreNon-accrual loans:Construction - 4,286 (100 ) 5,491 (100 )loansCommercial 38,173 33,715 13 36,968 3 mortgage loansCommercial 16,558 23,087 (28 ) 17,098 (3 )loansResidential 11,115 6,596 69 9,125 22 mortgage loansTotal $ 65,846 $ 67,684 (3 ) $ 68,682 (4 )non-accrual loans:Total 67,285 72,666 (7 ) 73,015 (8 )non-performing loansOther real 4,368 4,918 (11 ) 5,251 (17 )estate ownedTotal $ 71,653 $ 77,584 (8 ) $ 78,266 (8 )non-performing assetsAccruingtroubled debt $ 12,837 $ 27,721 (54 ) $ 24,406 (47 )restructurings(TDRs) Allowance for $ 136,157 $ 166,538 (18 ) $ 131,945 3 loan lossesTotal grossloans $ 16,342,479 $ 15,644,396 4 $ 15,976,781 2 outstanding,at period-end Allowance forloan losses to 202.36 % 229.18 % 180.71 %non-performing loans, atperiod-endAllowance forloan losses to 0.83 % 1.06 % 0.83 %gross loans,at period-end The ratio of non-performing assets to total assets was 0.3% as of December 31, 2021, compared to 0.4% as of December 31, 2020. Total non-performing assets decreased $5.9 million, or 7.6%, to $71.7 million as of December 31, 2021, compared to $77.6 million as of December 31, 2020, primarily due to a decrease of $3.5 million, or 71.1%, in accruing loans past due 90 days or more.

CAPITAL ADEQUACY REVIEW

As of December 31, 2021, the Company's Tier 1 risk-based capital ratio of 12.80%, total risk-based capital ratio of 14.41%, and Tier 1 leverage capital ratio of 10.40%, calculated under the Basel III capital rules, continue to place the Company in the "well capitalized" category for regulatory purposes, which is defined as institutions with a Tier 1 risk-based capital ratio equal to or greater than 8%, a total risk-based capital ratio equal to or greater than 10%, and a Tier 1 leverage capital ratio equal to or greater than 5%. As of December 31, 2020, the Company's Tier 1 risk-based capital ratio was 13.52%, total risk-based capital ratio was 15.45%, and Tier 1 leverage capital ratio was 10.94%.

FULL YEAR REVIEW

Net income for the year ended December 31, 2021, was $298.3 million, an increase of $69.4 million, or 30.3%, compared to net income of $228.9 million for the year ended December 31, 2020. Diluted earnings per share for the year ended December 31, 2021 was $3.80 compared to $2.87 per share for the year ended December 31, 2020. The net interest margin for the year ended December 31, 2021, was 3.22% compared to 3.12% for the year ended December 31, 2020.

Return on average stockholders' equity was 12.11% and return on average assets was 1.52% for the year ended December 31, 2021, compared to a return on average stockholders' equity of 9.7% and a return on average assets of 1.22% for the year ended December 31, 2020. The efficiency ratio for the year ended December 31, 2021, was 43.92% compared to 47.65% for the year ended December 31, 2020.

CONFERENCE CALL

Cathay General Bancorp will host a conference call to discuss its fourth quarter and year-end 2021 financial results this afternoon, Thursday, January 27, 2022, at 3:00 p.m., Pacific Time. Analysts and investors may dial in and participate in the question-and-answer session. To access the call, please dial 1-855-761-3186 and enter Conference ID 9375967. A presentation to accompany the earnings call will be available at www.cathaygeneralbancorp.com. A listen-only live Webcast of the call will be available at www.cathaygeneralbancorp.com and a recorded version is scheduled to be available for replay for 12 months after the call.

ABOUT CATHAY GENERAL BANCORP

Cathay General Bancorp is the holding company for Cathay Bank, a California state-chartered bank. Founded in 1962, Cathay Bank offers a wide range of financial services. Cathay Bank currently operates 37 branches in California, 10 in New York State, four in Washington State, two in Illinois, two in Texas, one in each of Maryland, Massachusetts, Nevada, New Jersey, and Hong Kong, and a representative office in Taipei, Beijing, and Shanghai. Cathay Bank's website is at www.cathaybank.com. Cathay General Bancorp's website is at www.cathaygeneralbancorp.com. Information set forth on such websites is not incorporated into this press release.

FORWARD-LOOKING STATEMENTS

Statements made in this press release, other than statements of historical fact, are forward-looking statements within the meaning of the applicable provisions of the Private Securities Litigation Reform Act of 1995 regarding management's beliefs, projections, and assumptions concerning future results and events. These forward-looking statements may include, but are not limited to, such words as "aims," "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "hopes," "intends," "may," "plans," "projects," "predicts," "potential," "possible," "optimistic," "seeks," "shall," "should," "will," and variations of these words and similar expressions. Forward-looking statements are based on estimates, beliefs, projections, and assumptions of management and are not guarantees of future performance. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or projections. Such risks and uncertainties and other factors include, but are not limited to, adverse developments or conditions related to or arising from local, regional, national and international business, market and economic conditions and events (such as the COVID-19 pandemic) and the impact they may have on us, our customers and our operations, assets and liabilities; possible additional provisions for loan losses and charge-offs; credit risks of lending activities and deterioration in asset or credit quality; extensive laws and regulations and supervision that we are subject to including potential future supervisory action by bank supervisory authorities; increased costs of compliance and other risks associated with changes in regulation including the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act; higher capital requirements from the implementation of the Basel III capital standards; compliance with the Bank Secrecy Act and other money laundering statutes and regulations; potential goodwill impairment; liquidity risk; fluctuations in interest rates; risks associated with acquisitions and the expansion of our business into new markets; inflation and deflation; real estate market conditions and the value of real estate collateral; our ability to generate anticipated returns on our investments and financings, including in tax-advantaged projects; environmental liabilities; our ability to compete with larger competitors; our ability to retain key personnel; successful management of reputational risk; natural disasters, public health crises (such as the COVID-19 pandemic) and geopolitical events; general economic or business conditions in Asia, and other regions where Cathay Bank has operations; failures, interruptions, or security breaches of our information systems; our ability to adapt our systems to technological changes; risk management processes and strategies; adverse results in legal proceedings; certain provisions in our charter and bylaws that may affect acquisition of the Company; changes in accounting standards or tax laws and regulations; market disruption and volatility; restrictions on dividends and other distributions by laws and regulations and by our regulators and our capital structure; issuance of preferred stock; successfully raising additional capital, if needed, and the resulting dilution of interests of holders of our common stock; the soundness of other financial institutions; and general competitive, economic political, and market conditions and fluctuations.

These and other factors are further described in Cathay General Bancorp's Annual Report on Form 10-K for the year ended December 31, 2020 (Item 1A in particular), other reports filed with the Securities and Exchange Commission ("SEC"), and other filings Cathay General Bancorp makes with the SEC from time to time. Actual results in any future period may also vary from the past results discussed in this press release. Given these risks and uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, we undertake no obligation to update or review any forward-looking statement to reflect circumstances, developments or events occurring after the date on which the statement is made or to reflect the occurrence of unanticipated events.

CATHAY GENERAL BANCORP

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Unaudited)

Three months ended Year ended December 31,(Dollars inthousands, December September December 2021 2020except per share 31, 2021 30, 2021 31, 2020data) FINANCIALPERFORMANCENet interestincome before $ 155,452 $ 152,484 $ 139,820 $ 597,755 $ 552,110 (reversal)/provision forcredit losses(Reversal)/ 3,500 3,050 (5,000 ) (16,008 ) 57,500 provision forcredit lossesNet interestincome after 151,952 149,434 144,820 613,763 494,610 (reversal)/provision forcredit lossesNon-interest 19,804 12,216 11,451 54,603 42,820 incomeNon-interest 73,197 72,215 75,046 286,523 283,465 expenseIncome before 98,559 89,435 81,225 381,843 253,965 income taxexpenseIncome tax 23,234 17,038 10,332 83,539 25,105 expenseNet income $ 75,325 $ 72,397 $ 70,893 $ 298,304 $ 228,860

Net income percommon shareBasic $ 0.98 $ 0.93 $ 0.89 $ 3.81 $ 2.88

Diluted $ 0.98 $ 0.93 $ 0.89 $ 3.80 $ 2.87

Cash dividends $ 0.34 $ 0.31 $ 0.31 $ 1.27 $ 1.24 paid per commonshare SELECTED RATIOSReturn on 1.48 % 1.45 % 1.50 % 1.52 % 1.22 %average assetsReturn onaverage total 12.12 % 11.61 % 11.75 % 12.11 % 9.70 %stockholders'equityEfficiency ratio 41.77 % 43.85 % 49.61 % 43.92 % 47.65 %

Dividend payout 34.50 % 33.34 % 34.80 % 33.30 % 43.12 %ratio YIELD ANALYSIS(Fully taxableequivalent)Total 3.52 % 3.56 % 3.74 % 3.59 % 3.96 %interest-earningassetsTotal 0.41 % 0.48 % 0.86 % 0.52 % 1.14 %interest-bearingliabilitiesNet interest 3.11 % 3.08 % 2.88 % 3.07 % 2.82 %spreadNet interest 3.23 % 3.22 % 3.12 % 3.22 % 3.12 %margin CAPITAL RATIOS December September December 31, 2021 30, 2021 31, 2020Tier 1 12.80 % 13.29 % 13.52 %risk-basedcapital ratioTotal risk-based 14.41 % 14.93 % 15.45 %capital ratioTier 1 leverage 10.40 % 10.67 % 10.94 %capital ratio . . . CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except share and December 31, September 30, December 31,per share data) 2021 2021 2020 AssetsCash and due from banks $ 134,141 $ 156,287 $ 138,616

Short-term investments and 2,315,563 1,667,875 1,282,462 interest bearing depositsSecurities available-for-sale(amortized cost of $1,126,867at December 31, 2021, 1,127,309 1,079,216 1,036,550 $1,073,074 at September 30,2021 and $1,019,230 at December31, 2020)Loans 16,342,479 15,976,781 15,644,396

Less: Allowance for loan (136,157 ) (131,945 ) (166,538 ) losses Unamortized deferred (4,321 ) (3,835 ) (2,494 ) loan fees, net Loans, net 16,202,001 15,841,001 15,475,364

Equity securities 22,319 20,117 23,744

Federal Home Loan Bank stock 17,250 17,250 17,250

Other real estate owned, net 4,368 5,251 4,918

Affordable housing investments 299,211 313,517 309,016 and alternative energypartnerships, netPremises and equipment, net 99,402 100,344 102,998

Customers' liability on 8,112 13,185 13,753 acceptancesAccrued interest receivable 56,994 56,844 59,032

Goodwill 372,189 372,189 372,189

Other intangible assets, net 4,627 4,831 5,434

Right-of-use assets-operating 27,834 29,179 30,919 leasesOther assets 195,403 183,354 170,889

Total assets $ 20,886,723 $ 19,860,440 $ 19,043,134

Liabilities and Stockholders'EquityDepositsNon-interest-bearing demand $ 4,492,054 $ 4,024,504 $ 3,365,086 depositsInterest-bearing deposits:NOW deposits 2,522,442 2,202,956 1,926,135

Money market deposits 4,611,579 4,132,912 3,359,191

Savings deposits 915,515 920,138 785,672

Time deposits 5,517,252 5,726,360 6,673,317

Total deposits 18,058,842 17,006,870 16,109,401

Advances from the Federal Home 20,000 20,000 150,000 Loan BankOther borrowings for affordable 23,145 23,197 23,714 housing investmentsLong-term debt 119,136 119,136 119,136

Acceptances outstanding 8,112 13,185 13,753

Lease liabilities - operating 30,694 32,028 33,484 leasesOther liabilities 180,544 182,733 175,502

Total liabilities 18,440,473 17,397,149 16,624,990

Stockholders' equity 2,446,250 2,463,291 2,418,144

Total liabilities and equity $ 20,886,723 $ 19,860,440 $ 19,043,134

Book value per common share $ 32.29 $ 31.89 $ 30.41

Number of common shares 75,750,862 77,240,215 79,508,265 outstanding CATHAY GENERAL BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

Three months ended Year ended December 31, December 31, September 30, December 31, 2021 2020 2021 2021 2020 (In thousands, except share and per share data)INTEREST ANDDIVIDEND INCOMELoanreceivable, $ 164,062 $ 163,948 $ 163,618 $ 649,224 $ 677,193 including loanfeesInvestment 4,188 3,707 3,469 14,151 20,599 securitiesFederal Home 261 258 217 991 952 Loan Bank stockDeposits with 678 714 292 2,145 1,830 banksTotal interest 169,189 168,627 167,596 666,511 700,574 and dividend income INTEREST EXPENSETime deposits 7,179 9,299 19,416 40,542 111,629

Other deposits 4,957 5,243 5,725 21,259 25,396

Advances from 146 146 1,180 1,182 5,299 Federal Home Loan BankLong-term debt 1,455 1,455 1,455 5,773 5,791

Deferred - - - - 115 payments from acquisitionShort-term - - - - 234 borrowingsTotal interest 13,737 16,143 27,776 68,756 148,464 expense Net interestincome before 155,452 152,484 139,820 597,755 552,110 (reversal)/ provision forcredit losses(Reversal)/ 3,500 3,050 (5,000 ) (16,008 ) 57,500 provision for credit lossesNet interestincome after 151,952 149,434 144,820 613,763 494,610 (reversal)/ provision forcredit losses NON-INTEREST INCOMENet gains/(losses) from 2,202 3 780 (1,426 ) (1,148 )equitysecuritiesSecurities - - 542 853 1,695 gains, netLetters of 1,867 1,764 1,749 7,103 6,741 credit commissionsDepository 1,477 1,401 1,271 5,584 4,949 service feesOther 14,258 9,048 7,109 42,489 30,583 operating incomeTotal 19,804 12,216 11,451 54,603 42,820 non-interest income NON-INTEREST EXPENSESalaries and 33,878 33,437 31,545 132,795 124,022 employee benefitsOccupancy 5,176 5,136 5,199 20,318 20,634 expenseComputer and 3,456 3,175 2,915 13,549 11,133 equipment expenseProfessional 6,968 6,232 6,270 23,666 21,856 services expenseDataprocessing 3,185 3,524 3,893 13,607 14,897 serviceexpenseFDIC and State 1,937 1,830 2,145 7,132 8,999 assessmentsMarketing 1,643 945 1,334 6,913 5,224 expenseOther realestate owned 146 (88 ) 138 343 (3,091 )expense/(income)Amortizationof investmentsin low income 10,784 12,411 15,228 45,447 58,225 housing and alternativeenergypartnershipsAmortizationof core 172 172 172 687 687 depositintangiblesCostassociated - - 693 732 693 with debtredemptionAcquisition,integration 949 476 - 1,425 - and reorganizationcostsOther 4,903 4,965 5,514 19,909 20,186 operating expenseTotal 73,197 72,215 75,046 286,523 283,465 non-interest expense Income before 98,559 89,435 81,225 381,843 253,965 income tax expenseIncome tax 23,234 17,038 10,332 83,539 25,105 expenseNet income $ 75,325 $ 72,397 $ 70,893 $ 298,304 $ 228,860

Net income per common share:Basic $ 0.98 $ 0.93 $ 0.89 $ 3.81 $ 2.88

Diluted $ 0.98 $ 0.93 $ 0.89 $ 3.80 $ 2.87

Cash dividends $ 0.34 $ 0.31 $ 0.31 $ 1.27 $ 1.24 paid per common shareBasic average 76,566,481 77,846,424 79,540,694 78,268,369 79,584,560 common shares outstandingDilutedaverage common 76,914,817 78,153,408 79,834,150 78,570,638 79,777,847 sharesoutstanding CATHAY GENERAL BANCORP

AVERAGE BALANCES - SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited)

Three months ended(In thousands) December 31, 2021 September 30, 2021 December 31, 2020 Average Average Average Average Average AverageInterest-earning Yield/ Yield/ Yield/assets Balance Rate ^ Balance Rate ^ Balance Rate ^ (1) (1) (1)

Loans ^(1) $ 16,130,896 4.04 % $ 15,798,496 4.12 % $ 15,569,490 4.18 %

Taxable investment 1,152,596 1.44 % 1,058,004 1.39 % 1,073,058 1.29 %securitiesFHLB stock 17,250 6.00 % 17,250 5.93 % 17,250 5.00 %

Deposits with banks 1,779,275 0.15 % 1,893,785 0.15 % 1,156,764 0.10 %

Total $ 19,080,017 3.52 % $ 18,767,535 3.56 % $ 17,816,562 3.74 %interest-earning assets Interest-bearing liabilitiesInterest-bearing $ 2,217,341 0.08 % $ 2,109,632 0.10 % $ 1,694,831 0.15 %demand depositsMoney market 4,393,816 0.39 % 4,228,025 0.43 % 3,295,103 0.59 %depositsSavings deposits 932,678 0.08 % 914,540 0.07 % 797,438 0.11 %

Time deposits 5,604,073 0.51 % 5,882,576 0.63 % 6,687,731 1.15 %

Total $ 13,147,908 0.37 % $ 13,134,773 0.44 % $ 12,475,103 0.80 %interest-bearing depositsOther borrowed funds 43,186 1.34 % 43,246 1.34 % 237,467 1.98 %

Long-term debt 119,136 4.85 % 119,136 4.84 % 119,136 4.86 %

Total 13,310,230 0.41 % 13,297,155 0.48 % 12,831,706 0.86 %interest-bearing liabilitiesNon-interest-bearing 4,162,906 3,830,485 3,365,075demand depositsTotal deposits and $ 17,473,136 $ 17,127,640 $ 16,196,781other borrowed funds Total average assets $ 20,176,429 $ 19,812,508 $ 18,843,635

Total average equity $ 2,466,363 $ 2,473,223 $ 2,400,494

Year ended(In thousands) December 31, 2021 December 31, 2020 Average Average Average AverageInterest-earning Yield/ Yield/assets Balance Rate ^ Balance Rate ^ (1) (1)

Loans ^(1) $ 15,827,550 4.10 % $ 15,500,910 4.37 %

Taxable investment 1,046,187 1.35 % 1,215,957 1.69 %securitiesFHLB stock 17,250 5.74 % 17,300 5.50 %

Deposits with banks 1,649,564 0.13 % 960,276 0.19 %

Total $ 18,540,551 3.59 % $ 17,694,443 3.96 %interest-earning assets Interest-bearing liabilitiesInterest-bearing $ 2,047,177 0.11 % $ 1,591,924 0.18 %demand depositsMoney market 4,034,246 0.45 % 2,903,837 0.74 %depositsSavings deposits 897,663 0.09 % 759,581 0.13 %

Time deposits 5,979,191 0.68 % 7,268,738 1.54 %

Total $ 12,958,277 0.48 % $ 12,524,080 1.09 %interest-bearing depositsOther borrowed funds 75,516 1.57 % 326,023 1.73 %

Long-term debt 119,136 4.85 % 119,136 4.86 %

Total 13,152,929 0.52 % 12,969,239 1.14 %interest-bearing liabilitiesNon-interest-bearing 3,751,626 3,158,828demand depositsTotal deposits and $ 16,904,555 $ 16,128,067other borrowed funds Total average assets $ 19,591,538 $ 18,736,854

Total average equity $ 2,463,021 $ 2,359,735

(1) Yields and interest earned include net loan fees. Non-accrual loans are included in the average balance. View source version on businesswire.com: https://www.businesswire.com/news/home/20220126006064/en/

CONTACT: Heng W. Chen (626) 279-3652