UBS initiated coverage of East West Bancorp with a Neutral rating and $63 price target. The bank is a "solid franchise" with a strong niche in the Asian American community, and above peer levels of growth and profitability, but consensus estimates on East West Bancorp are "overoptimistic", the analyst tells investors in a research note. UBS cites a lower level on Fed Funds than is baked into consensus, reaching 3% by the end of 2024, which should pressure the company’s net interest income, along with its higher net charge-off estimates given an outlook for a mild recession.
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