East West Bank says business model is ‘diversified’, liquidity is ‘strong’

East West Bancorp provided the following unaudited financial update. "In light of recent industry events and market volatility, we reiterate that East West Bank’s business model is diversified, our balance sheet is managed conservatively, and our liquidity is strong. Our industry-leading profitability and our high-quality earnings have resulted in very strong capital levels, which form a firm foundation for our bank," stated Dominic Ng, Chairman and CEO of East West. Year-to-date, consumer deposits are up 3% and commercial deposits have been essentially stable. Total deposits were $55.3B as of March 10, 2023, compared with $56B as of December 31, 2022, because of a planned and intentional reduction in brokered deposits of over $1B throughout the first quarter. Deposits are well-diversified by industry and depositor type with no significant customer or sector concentrations. Venture capital deposits were approximately $1B as of March 10, 2023, or less than 2% of total deposits. We have no exposure to cryptocurrency. As of December 31, 2022, East West’s tangible common equity ratio was 8.7%, far exceeding the median of 6.3% for money-center banks or 6.7% for regional and smaller banks. As of December 31, 2022, our common equity tier 1 ratio was 12.7%, and our total capital ratio was 14.0%. All our regulatory capital ratios expanded quarter-over-quarter in the fourth quarter of 2022, and all our capital ratios substantially exceed regulatory requirements. East West’s balance sheet is conservatively managed, and we have strong liquidity. Our available, unused borrowing capacity was $28B as of March 13, 2023, equivalent to over 50% of total deposits. The company said, "The asset quality of our loan portfolio continues to be strong and stable. We have experienced no changes in our credit metrics since year-end, including to classified loans, non-performing assets, and charge-off ratios. As of December 31, 2022, non-performing assets were 16 basis points of total assets."