What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-03-02 compared with 2025-02-28 · 236 added, 205 removed, 2283 unchanged (16% of the section changed)

42 unchanged sentences

Other Information

During the quarter ended December 31, 2025, no director or Section 16 officer adopted or terminated any Rule 10b5 - 1 trading arrangements or non-Rule 10b5 - 1 trading arrangements, as defined under Item 408 (a) of Regulation S-K.

Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

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Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated).

Previously filed with the Securities and Exchange Commission on February 29, 2016 as an exhibit to the Bancorp’s Annual Report on Form 10-K for the year ended December 31,2015 and incorporated herein by reference.

Previously filed with the Securities and Exchange Commission on August 8, 2025 as an exhibit to the Bancorp ’ s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 and incorporated herein by reference.

Executive Officer Annual Cash Bonus Program under the Company’s 2005 Incentive Plan (As Amended and Restated).

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2016 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Performance Shares – EPS), used to award performance-based restricted stock units.

Previously filed with the Securities and Exchange Commission on February 28, 2025, as an exhibit to the Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2024, and incorporated herein by reference.

2016 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Performance Shares – TSR), used to award performance-based restricted stock units.

2016 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Performance Shares – ROA), used to award performance-based restricted stock units.

2016 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Clawback Rider), used to award performance-based restricted stock units.

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2025 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Performance Shares – EPS)

Previously filed with the Securities and Exchange Commission on August 8, 2024, as an exhibit to the Bancorp’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, and incorporated herein by reference.

2025 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Performance Shares – TSR)

2025 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Performance Shares – ROA).

2025 Form of Cathay General Bancorp 2005 Incentive Plan (As Amended and Restated) Restricted Stock Unit Agreement (Time-Based Shares).

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Previously filed with the Securities and Exchange Commission on March 3, 2014 as an exhibit to the Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2013 and incorporated herein by reference.

Amended and Restated Change of Control Employment Agreement for Kim R.

Bingham dated as of December 18, 2008.

Previously filed with the Securities and Exchange Commission on March 3, 2014, as an exhibit to the Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2013 and incorporated herein by reference.

Form of Change of Control Employment Agreement to be entered into with Executive Officers on or after July 16, 2020.

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Cathay General Bancorp Insider Trading Policy.

Subsidiaries of the Bancorp.

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February 27, 2026

February 28, 2025

/s/ Nelson Chung

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Maan-Huei Hung

/s/ Joseph C.H.

February 28, 2025

/s/ Richard Sun

7 unchanged sentences

Elizabeth Woo

/s/ Lana Chan

February 27, 2026

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

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Allowance for loan losses for loans evaluated on a collective basis modeled using an econometric methodology.

As discussed in Note 4 to the consolidated financial statements, the Company’s total allowance for loan losses as of December 31, 2024 was $161.8 million, a substantial portion of which relates to the allowance for loan losses on loans evaluated on a collective basis over residential mortgages, commercial and industrial loans, construction loans, commercial real estate for multifamily loans, commercial real estate for owner-occupied loans, and other commercial real estate loans (hereafter “six portfolios”).

As discussed in Note 1, the collective ALL includes the measure of expected credit losses on a collective basis by pooling those loans that share similar risk characteristics into these six portfolios.

As discussed in Note 4 to the consolidated financial statements, the Company’s total allowance for loan losses as of December 31, 2025 was $195.9 million, a substantial portion of which relates to the allowance for loan losses on loans evaluated on a collective basis for residential mortgages, commercial and industrial loans, construction loans, commercial real estate for multifamily loans, commercial real estate for owner-occupied loans, and other commercial real estate loans (hereafter “six portfolios”).

As discussed in Note 1, the six portfolios use a methodology that includes econometric regression models, risk ratings, and certain qualitative loss factors (together the collective ALL).

The collective ALL includes the measure of expected credit losses on a collective basis by pooling those loans that share similar risk characteristics into these six portfolios.

The collective ALL methodology uses historical credit loss experience as a basis for estimation of expected credit losses at the collective pool basis over the contractual term of the loans, adjusted for expected prepayments when appropriate.

The Company calculates the collective ALL by estimating the probability of default during the reasonable and supportable forecast period using separate econometric regression models developed to correlate macroeconomic variables to loan risk rating performance for each of the six portfolios.

Loss given default rates are computed based on the net charge-offs recognized and then applied to the expected exposure at default of defaulted loans.

Loss given default rates are computed based on the net charge-offs recognized.

The probability of default and the loss given default rates are applied to the expected amount at default at the loan level based on contractual scheduled payments and estimated prepayments.

The collective ALL incorporates reasonable and supportable forecasts of various macroeconomic variables over a two-year reasonable and supportable forecast period, reverting linearly to long-term loss rates over the one-year reversion period.

Management relies on multiple forecasts, which are weighted in determining a single loss estimate.

Management relies on multiple forecast scenarios, which are weighted in determining a single loss estimate.

Adjustments to historical loss information are made for differences in current loan-specific risk characteristics as well as for changes in environmental conditions.

The adjustments, or qualitative loss factors, consider idiosyncratic risk factors, conditions that may not be reflected in quantitatively derived results, or other relevant factors to seek to ensure the allowance for credit losses reflects the Company’s best estimate of current expected credit losses.

The adjustments, or qualitative loss factors, consider incremental risk factors, conditions that may not be reflected in quantitatively derived results, or other relevant factors to seek to ensure the allowance for credit losses reflects the Company’s best estimate of current expected credit losses.

We identified the assessment of the collective ALL as a critical audit matter.

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This included our assessment of the collective ALL methodology, including the econometric models used to estimate expected credit losses and their significant assumptions.

Such significant assumptions included portfolio segmentation, the weighting of the economic forecast scenarios, the selection of macroeconomic variables, the length of the reasonable and supportable forecast period, and risk ratings.

The assessment also included the evaluation of the qualitative loss factors.

Such significant assumptions included the weighting of the economic forecast scenarios, the selection of macroeconomic variables, and risk ratings.

The assessment also included evaluation of the qualitative loss factors.

In addition, auditor judgment was required to evaluate the sufficiency of audit evidence obtained.

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evaluating judgments made relative to the development and performance monitoring of the econometric models by comparing them to Company-specific metrics and trends and the applicable industry and regulatory practices

assessing the conceptual soundness and performance testing of the econometric models by inspecting the model validation documentation to determine whether the models are suitable for their intended use

evaluating the judgments made by the Company in selecting the macroeconomic variables, including the reasonable and supportable forecast period and economic scenario weightings used, by comparing them to the Company’s business environment and relevant industry practice

determining whether the loan portfolio is segmented by similar risk characteristics by comparing to specific portfolio risk characteristics and trends

assessing the conceptual soundness and performance testing of the econometric models by inspecting the model validation and model development documentation to determine whether the models are suitable for their intended use

evaluating the judgments made by the Company in selecting the macroeconomic variables, including the economic scenario weightings used, by comparing them to the Company’s business environment and relevant industry practice

testing individual risk ratings for a selection of loans by evaluating the financial performance of the borrower, sources of repayment, and any relevant guarantees or underlying collateral

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1,658,223 1,547,128

Loans held for sale

20,147,202 19,375,955

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Advances from the Federal Home Loan Bank

60,000 540,000

Other borrowings for affordable housing investments

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Non-Interest Income

Net (losses)/gains from equity securities

Net gains/(losses) from equity securities

7,392 ( 7,516 ) 18,248

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6,003 6,520 5,887

Other real estate owned expense

Other real estate owned (income)/expense

( 1,152 ) 2,699 761

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Other Comprehensive Income/(Loss), Net of Tax:

Net holding gains/(losses) on securities available-for-sale

Net holding gains on securities available-for-sale

31,207 583 18,642

Net holding (losses)/gains on cash flow hedge derivatives

Net holding losses on cash flow hedge derivatives

— ( 774 ) ( 1,763 )

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— — — — ( 98,638 ) — ( 98,638 )

Other comprehensive loss

Other comprehensive income

— — — 16,879 — — 16,879

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Restricted stock units vested

183,324 2 — — — — 2

Shares withheld related to net share settlement of RSUs

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Stock -based compensation

— — 6,984 — — — 6,984

Cash dividends of $ 1.36 per share

( 97,967 ) ( 97,967 )

Other comprehensive income

Other comprehensive loss

( 191 ) ( 191 )

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( 93,800 ) ( 93,800 )

Other comprehensive loss

Other comprehensive income

31,207 31,207

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CATHAY GENERAL BANCORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

CONSOLIDATED STATEMENTS OF CASH FLOW

Year Ended December 31,

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Provision for losses on other real estate owned

Deferred tax benefit

1,752 1,164 —

Deferred tax provision/(benefit)

12,145 ( 20,756 ) ( 4,782 )

Depreciation and amortization

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Net gains on sale and transfers of other real estate owned

Net losses/(gains) on sale of loans

( 3,898 ) — —

Net (gains)/losses on sale of loans

( 435 ) 737 —

Loss on sales or disposal of fixed assets

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( 27,043 ) ( 25,369 ) ( 11,373 )

Unrealized loss/(gain) on equity securities

Unrealized (gain)/loss on equity securities

( 7,392 ) 7,516 ( 18,248 )

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( 1,712,903 ) ( 1,358,614 ) ( 618,334 )

Purchase of equity securities

( 3,000 ) — —

Proceeds from repayment, maturity, and call of investment securities available-for-sale

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Proceeds from sale of investment securities available-for-sale

Proceeds from sale of equity securities

Benefits received from bank owned life insurance policies

Purchase of Federal Home Loan Bank stock

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Proceeds from sale of loans originally classified as held-for-investment

50,329 172,960 —

Net increase in loans

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Proceeds from sales of other real estate owned

Net increase in investment in affordable housing and alternative energy partnerships

( 32,763 ) ( 50,616 ) ( 6,995 )

Acquisitions, net of cash acquired

Net increase/(decrease) in investment in affordable housing and alternative energy partnerships

2,854 ( 32,763 ) ( 50,616 )

Net cash provided/(used) for investing activities

Net cash (used)/provided for investing activities

( 857,321 ) 184,030 ( 1,477,080 )

Cash Flows from Financing Activities

Increase/(decrease) in deposits

Increase in deposits

1,207,898 360,997 820,041

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( 2,779 ) ( 3,726 ) ( 4,490 )

Net cash (used)/provided by financing activities

Net cash provided/(used) by financing activities

873,641 ( 302,466 ) 758,737

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$ 31,207 $ 583 $ 18,642

Net change in unrealized holding (loss)/gain on cash flow hedge derivatives

Net change in unrealized holding loss on cash flow hedge derivatives

$ — $ ( 774 ) $ ( 1,763 )

Loans transferred from held-for-investment to held-for-sale

$ 58,832 $ 173,697 $ —

Transfers to other real estate owned from loans held-for-investment

$ 11,357 $ 4,794 $ 15,374

Loans transferred from held-for-investment to held-for-sale

Transfers to other real estate owned from loans held-for-sale

$ 8,938 $ — $ —

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Summary of Significant Accounting Policies

The accompanying Consolidated Financial Statements include the accounts of Cathay General Bancorp (the “Bancorp”), a Delaware corporation, its wholly-owned subsidiaries, Cathay Bank (the “Bank”), a California state-chartered bank, and eleven limited partnerships investing in affordable housing projects (together, the “Company,” “we,” “us,” or “our”).

The accompanying Consolidated Financial Statements include the accounts of Cathay General Bancorp (the “Bancorp”), a Delaware corporation, its wholly-owned subsidiaries, Cathay Bank (the “Bank”), a California state-chartered bank, and twelve limited partnerships investing in affordable housing projects (together, the “Company,” “we,” “us,” or “our”).

All significant inter-company transactions and balances have been eliminated in consolidation.

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As each AFS debt security has a unique security structure, where the accrual status is clearly determined when certain criteria listed in the terms are met, the Company assesses the default status of each security as defined by the debt security’s specific security structure.

Trading securities are reported at fair value, with unrealized gains or losses included in income.

Equity securities.

The Company owns equity securities directly or indirectly through limited partnership interests in private investment funds that invest in privately held and publicly traded equity securities.

These investments are accounted for in accordance with ASC 321 or ASC 323, depending on the nature of the Company’s ownership interests and the rights conveyed.

When the Company does not have significant influence over the investee and the fair value of the investment is readily determinable, the investment is measured at fair value with changes recognized in net income.

When the Company does not have significant influence over the investee and the fair value of the investment is not readily determinable, the investment is measured under the ASC 321 measurement alternative and carried at cost, adjusted for observable price changes and impairments, with changes recognized in net income.

For investments in which the Company has the ability to exercise significant influence over the operating and financial policies of the investee, the equity method of accounting is applied.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

The Company records its share of earnings or losses on those investments accounted for under the equity method of accounting based on the latest available financial information which is consistent with the timing of financial information made available by the investees to investors.

The Company evaluates these investments for impairment in accordance with applicable guidance.

Investment in Federal Home Loan Bank ( “ FHLB ” ) Stock.

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As of December 31, 2025 , the Company owned 172,500 shares of FHLB stock, which exceeded the minimum stock requirement of 150,000 shares.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

Loans Held for Investment.

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For loans that are not collateral-dependent, the Company uses the present value of future cash flows.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

Under the Company’s CECL methodology, nine portfolio segments with similar risk characteristics are evaluated for expected loss.

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We estimate the probability of default during the reasonable and supportable forecast period using separate econometric regression models developed to correlate macroeconomic variables, (GDP, unemployment, CRE prices and residential mortgage prices) to loan risk rating performance for each of the six loan portfolios from the fourth quarter of 2007 to the fourth quarter of 2024.

Loss given default rates are computed based on the net charge-offs recognized divided by the exposure at default of defaulted loans starting with the fourth quarter of 2007 through the fourth quarter of 2022.

Loss given default rates are computed based on the net charge-offs recognized divided by the exposure at default starting with the fourth quarter of 2007 through the fourth quarter of 2025.

The probability of default and the loss given default rates are applied to the expected amount at default at the loan level based on contractual scheduled payments and estimated prepayments.

The amounts so calculated comprise the quantitative portion of the allowance for credit losses.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

The Company’s CECL methodology utilizes an eight -quarter reasonable and supportable (“R&S”) forecast period, and a four -quarter reversion period.

Management relies on multiple forecasts, which are weighted in determining a single loss estimate.

Management relies on multiple forecasts scenarios, which are weighted in determining a single loss estimate.

Generally speaking, the blended scenario approach would include the Baseline, the Alternative Scenario 1 – Upside – 10th Percentile and the Alternative Scenario 3 – Downside – 90th Percentile forecasts.

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Under the Company’s CECL methodology, the qualitative portion of the reserve on pooled loans represents management’s judgment of additional considerations to account for internal and external risk factors that are not adequately measured in the quantitative reserve.

The qualitative loss factors consider idiosyncratic risk factors, conditions that may not be reflected in quantitatively derived results, or other relevant factors to seek to ensure the allowance for credit losses reflects our best estimate of current expected credit losses.

The qualitative loss factors consider incremental risk factors, conditions that may not be reflected in quantitatively derived results, or other relevant factors to seek to ensure the allowance for credit losses reflects our best estimate of current expected credit losses.

The qualitative reserves include reserves for policy exceptions, experience of management and staff, level of competition in the lending environment, weak risk identification, lack of historical loss experience with residential mortgage loans made to non-U.S.

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Although the allowance for credit losses is considered by management to be appropriate, there can be no assurance that it will be sufficient to absorb future losses.

During the second quarter of 2025, the Company updated its CECL methodology to better reflect expansion periods and recession periods and increase sensitivity to economic forecasts and adopted new models for all loan pools while recalibrating with losses incurred in 2023 and 2024.

The implemented changes to the CECL model resulted in a significant increase in the quantitative reserve, though simultaneous decreases to the individually evaluated loan reserve and qualitative reserves mitigated this impact during the quarter ended June 30, 2025.

Management believes the allowance for credit losses is appropriate for the current expected credit losses in our loan portfolio and associated unfunded commitments, and the risk ratings and inherent loss rates currently assigned are reasonable and appropriate as of the reporting date.

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on nonaccrual status, modifications to borrowers experiencing financial difficulty, or payment delinquency of 90 days or more.

The Company has adopted ASU 2022 - 02, “Financial Instruments – Troubled Debt Restructurings and Vintage Disclosures” effective January 1, 2023.

As part of the adoption, the Company has elected to apply the pending content prospectively and the practical expedient to exclude the accrued interest receivable balance from the disclosed amortized cost basis of loan modifications to debtors experiencing financial difficulty, consistent with our ACL approach discussed further below in this footnote.

Under the new guidance on loan modifications made to borrowers experiencing financial difficulty, when a loan held for investment is modified and is considered to be a continuation of the original loan, the Company uses the post-modification contractual rate to derive the effective interest rate when using a discounted cash flow method to determine the allowance for credit loss.

The amendments in this new guidance eliminate the previous TDR recognition and measurement guidance and, instead, require that an entity evaluate whether the modification represents a new loan or a continuation of an existing loan.

Under the prior TDR guidance, a TDR is a formal modification of the terms of a loan when the lender, for economic or legal reasons related to the borrower’s financial difficulties, grants a concession to the borrower.

The concessions may be granted in various forms, including a change in the stated interest rate, a reduction in the loan balance or accrued interest, or an extension of the maturity date.

Although these loan modifications were considered TDRs, TDR loans that had, pursuant to the Bank’s policy, performed under the restructured terms and had demonstrated sustained performance under the modified terms for six months were returned to accrual status.

The sustained performance considered by management pursuant to its policy included the periods prior to the modification if the prior performance met or exceeded the modified terms.

This would include cash paid by the borrower prior to the restructuring to set up interest reserves.

Loans classified as TDRs were reported as individually evaluated loans.

The allowance for credit loss on a TDR was measured using the same method as all other loans held for investment, except when the value of a concession cannot be measured using a method other than the discounted cash flow method.

Under the prior guidance when the value of a concession was measured using the discounted cash flow method, the allowance for credit loss was determined by discounting the expected future cash flows at the original interest rate of the loan.

The Company has adopted ASU 2022 - 02, “Financial Instruments – Troubled Debt Restructurings and Vintage Disclosures”.

The Company has elected to apply the guidance prospectively and the practical expedient to exclude the accrued interest receivable balance from the disclosed amortized cost basis of loan modifications to debtors experiencing financial difficulty, consistent with our ACL approach discussed further below in this footnote.

Under this guidance on loan modifications made to borrowers experiencing financial difficulty, when a loan held for investment is modified and is considered to be a continuation of the original loan, the Company uses the post-modification contractual rate to derive the effective interest rate when using a discounted cash flow method to determine the allowance for credit loss.

The amendments in this guidance require that an entity evaluate whether the modification represents a new loan or a continuation of an existing loan.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

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As further discussed in Note 5 to the Consolidated Financial Statements, the partnership interests are accounted for utilizing the equity method of accounting.

As of December 31, 2024 , eleven of the limited partnerships in which the Company has an equity interest were determined to be variable interest entities for which the Company is the primary beneficiary.

The Company therefore consolidated the financial statements of these eleven limited partnerships into the Consolidated Financial Statements.

As of December 31, 2025 , twelve of the limited partnerships in which the Company has an equity interest were determined to be variable interest entities for which the Company is the primary beneficiary.

The Company therefore consolidated the financial statements of these twelve limited partnerships into the Consolidated Financial Statements.

The tax credits from these partnerships are recognized in the consolidated financial statements to the extent they are utilized on the Company’s income tax returns.

The investments are reviewed for impairment on an annual basis or on an interim basis if an event occurred that would trigger potential impairment.

Investments in Venture Capital.

The Company invests in limited partnerships that invest in nonpublic companies.

These are commonly referred to as venture capital investments.

These limited partnership interests are carried under the cost method with impairment charged against net income.

Premises and Equipment.

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Other intangible assets.

Other intangible assets are mainly comprised of core deposit intangible ("CDI"), which represents the purchase price over the fair value of the deposits acquired from other financial institutions.

Other intangible assets are mainly comprised of core deposit intangible ("CDI"), which represents estimated fair value of the economic benefit associated with acquired core deposit relationships, initially measured upon acquisition as the value of those deposits in excess of the cost of alternative funding sources.

CDI is amortized over its estimated useful life to its residual value in proportion to the economic benefits consumed.

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A valuation allowance is established for deferred tax assets if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Accounting Changes, Reclassifications and Restatements.

Certain items in prior financial statements have been reclassified to conform to the current presentation.

We adopted ASU No.

2023 - 09, “ Income Taxes (Topic 740 ):

Improvements to Income Tax Disclosures ” for our annual financial statements in 2025.

See Note 11 - Income Taxes.

Comprehensive Income/(loss).

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Our Chief Executive Officer is our chief operating decision maker (“CODM”).

The CODM uses net income to evaluate financial performance and allocate resources based on net income that also is reported on the income statement as consolidated net income and compares to budgeted amounts.

The CODM evaluates financial performance and allocates resources based on consolidated net income which is consistent with the amounts reported in the Consolidated Statements of Income.

The accounting policies of the operating segment are the same as those of our consolidated entity and described in the summary of significant accounting policies.

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The Bank also offers trade financing, letters of credit, wire transfer, foreign currency spot and forward contracts, internet banking, investment services, and other customary banking services to its customers within the United States.

As such the Company does not report any disaggregated financial information.

Because the CODM reviews the business on a consolidated basis and the Company’s products and services are largely integrated, the Company does not report any disaggregated financial information for separate business lines.

The Company generates substantially all its revenues from banking services and does not have material operations outside the United States.

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Recent Accounting Pronouncements Adopted in 2025

In November 2023, ASU No.

2023 - 07, “Segment Reporting (Topic 280 ), Improvements to Reportable Segment Disclosures”, was issued.

This ASU expands the disclosure requirements for reportable segments of public entities by adding the following disclosure requirements.

The amendments require, on an annual and interim basis, significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss, on an annual and interim basis, disclose amount and description of composition of other segment items.

This amount reconciles segment revenues, less the significant segment expenses, to the reported measure of segment profit or loss; expands the current interim disclosure requirements to require all existing annual disclosures about a reportable segment’s profit or loss and assets also be made on an interim basis; clarifies that if a CODM uses more than one measure of segment profit or loss, then the entity may disclose one or more measures, but at least one measure should be that which is most consistent with GAAP measurement principles; and requires annual disclosure of the title and position of the CODM as well as explanation of how the CODM uses the reported measures in assessing segment performance and allocating resources.

The amendments in this update are effective for fiscal years beginning after December 15, 2023.

The Company has determined that the adoption of ASU 2023 - 07 did not have a significant impact on the Company’s Consolidated Financial Statements.

In March 2023, ASU 2023 - 02, “Investments-Equity Method and Joint Ventures (Topic 323 ):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method".

ASU 2023 - 02 permits reporting entities to elect to account for their tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met.

ASU 2023 - 02 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2023.

The Company elected not to apply the proportional method of amortization allowed as an election under ASU 2023 - 02.

In June 2022, ASU 2022 - 03, “Fair Value Measurement (Topic 820 ):

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions.” ASU 2022 - 03 clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value.

ASU 2022 - 03 also clarifies that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction and requires certain new disclosures for equity securities subject to contractual sale restrictions.

The adoption of ASU 2022 - 03 did not have a significant impact on our financial statements.

In December 2023, ASU No.

2023 - 09, “Income Taxes (Topic 740 ):

Improvements to Income Tax Disclosures” was issued.

This ASU amends the disclosure requirements for income taxes, including the requirement for further disaggregation of the income tax rate reconciliation and income taxes paid disclosures.

The amendments in this guidance are effective for annual periods beginning after December 15, 2024.

These amendments should be applied prospectively, with the option to apply retrospectively.

The Company has adopted ASU 2023 - 09 with the required disclosures included in Note 11.

Other Accounting Standards Pending Adoption

In December 2025, ASU 2025‑11, “Interim Reporting (Topic 270 ):

Narrow‑Scope Improvements.”, was issued.

ASU 2025 - 11 clarifies and enhances guidance under ASC 270 on interim financial reporting by (i) clarifying the scope of ASC 270 such that it now explicitly applies only to entities that issue complete interim financial statements and related notes under U.S.

GAAP, (ii) establishing clear guidance on the form of interim statements and notes, incorporating a comprehensive list of required interim disclosures drawn from across the ASC, and (iii) introducing a requirement to disclose material events and changes occurring after the end of the last annual period that could impact interim results.

ASU 2025 - 11 will be effective for us for interim periods beginning in 2028, though early adoption is permitted.

ASU 2025 - 11 is not expected to have a significant impact on our financial statements.

In November 2025, ASU 2025‑09, “Derivatives and Hedging (Topic 815 ):

Hedge Accounting Improvements.”, was issued.

ASU 2025 - 09 amends ASC 815 to align hedge accounting more closely with an entity’s economic risk management practices.

Key amendments include (i) to allow designating a variable price component of a nonfinancial forecasted purchase or sale as the hedged risk, (ii) to allow grouping individual forecasted transactions with similar ( not identical) risk exposures, (iii) a new model for hedging forecasted interest on variable-rate debt, enabling changes in index or tenor without de-designation, subject to simplifying assumptions, and (iv) additional clarifications related to hedge accounting of nonfinancial components, net written options, and dual-hedge strategies.

ASU 2025 - 09 will be effective for us beginning in 2027, though early adoption is permitted.

ASU 2025 - 09 is not expected to have a significant impact on our financial statements.

In November 2025, ASU 2025‑08, “Financial Instruments - Credit Losses (Topic 326 ):

Purchased Loans.”, was issued.

ASU 2025 - 08 expands the scope of the “gross‑up” method, formerly applicable only to purchased credit‑deteriorated ("PCD") assets, to include acquired non‑PCD loans that meet certain criteria, now referred to as “purchased seasoned loans” (PSLs).

Under this model, an allowance for expected credit losses is recognized at acquisition, offsetting the loan’s amortized cost basis, thereby eliminating the day- one credit‑loss expense previously required for non‑PCD assets.

PSLs are defined as non‑PCD loans acquired either (i) through a business combination, or (ii) purchased more than 90 days after origination when the acquirer was not involved in origination.

ASU 2025 - 08 will be effective for us, on a prospective basis for loans acquired on or after the adoption date, for interim and annual reporting periods beginning in 2027, though early adoption is permitted.

ASU 2025 - 08 is not expected to have a significant impact on our financial statements.

In September 2025, ASU No.

2025 - 06, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350 - 40 ):

Targeted Improvements to the Accounting for Internal-Use Software.”, was issued.

ASU 2025 - 06 simplifies and modernizes the accounting for internal-use software by removing prescriptive project stage guidance and introducing a new capitalization threshold.

Under the revised standard, software development costs are capitalized when management authorizes and commits funding for the project, and it is probable the software will be completed and used as intended.

ASU 2025 - 06 will be effective in 2028.

The Company does not expect the adoption of ASU 2025 - 06 to have a significant impact on its Consolidated Financial Statements.

In November 2024, ASU No.

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ASU 2024 - 03 is effective for us, on a prospective basis, for annual periods beginning in 2027, and interim periods within fiscal years beginning in 2028, though early adoption and retrospective application is permitted.

ASU 2024 - 03 is not expected to have a significant impact on our financial statements.

On March 6, 2024, the U.S.

Securities and Exchange Commission ("SEC") adopted final rules under SEC Release No.

33 - 11275, “The Enhancement and Standardization of Climate-Related Disclosures for Investors”.

This rule will require that climate-related information be included in a Company’s annual reports and registration statements.

The disclosure requirements will apply to the Company's fiscal year beginning January 1, 2025; however, the SEC has determined to stay the application of this rule pending the completion of judicial review in legal challenges related to the rule.

The Company is currently evaluating the final rule to determine its impact on the Company's disclosures.

In December 2023, ASU No.

2023 - 09, “Income Taxes (Topic 740 ):

Improvements to Income Tax Disclosures” was issued.

This ASU amends the disclosure requirements for income taxes, including the requirement for further disaggregation of the income tax rate reconciliation and income taxes paid disclosures.

The amendments in this guidance are effective for annual periods beginning after December 15, 2024.

These amendments should be applied prospectively, with the option to apply retrospectively.

The Company is currently evaluating the impact of this guidance on the Company’s Consolidated Financial Statements.

ASU 2024 - 03 is not expected to have a significant impact on its Consolidated Financial Statements.

Cash, Cash Equivalents and Restricted Cash

5 unchanged sentences

As of December 31, 2025 , and 2024 , the Company had $ 12.1 million and $ 43.4 million, respectively, as cash margin that serves as collateral on deposit in a cash margin account for interest rate swaps.

Of the balances held in the cash margin account $ 8.6 million are restricted as of December 31, 2024 , and 2023 .

As of December 31, 2024 , and December 31, 2023 , the Company held $ 0.3 million and $ 6.4 million, respectively, in a restricted escrow account with a major bank for its alternative energy investments.

Of the balances held in the cash margin account $ 4.3 million and $ 8.6 million are restricted as of December 31, 2025 , and 2024 , respectively.

As of December 31, 2025 , and 2024 , the Company held zero and $ 0.3 million, respectively, in a restricted escrow account with a major bank for its alternative energy investments.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

10 unchanged sentences

5,888 52 118 5,822

government sponsored entities

25,000 11 — 25,011

Mortgage-backed securities

34 unchanged sentences

$ 1,735,451 $ 1,658,223

Proceeds from the sale of investment securities were $ 33.7 million during the year ended December 31, 2024 .

There were no sales of investment securities during the years ended December 31, 2023, and 2022.

Gross realized gain on sale of investment securities was of $ 1.1 million for the year ended December 31, 2024 .

There were no proceeds from the sale of investment securities for the years ended December 31, 2025 and 2023, and $ 33.7 million during the year ended December 31, 2024 .

Gross realized gain on sale of investment securities was $ 1.1 million for the year ended December 31, 2024.

Allowance for Credit Losses

3 unchanged sentences

The issuers have not, to the Company’s knowledge, established any cause for default on these securities.

The Company expects to recover the amortized cost basis of its securities and has no present intent to sell and will not be required to sell securities AFS that have declined below their cost before their anticipated recovery.

The Company expects to recover the amortized cost basis of its securities and has no present intent to sell and will not be required to sell AFS securities that have declined below their cost before their anticipated recovery.

Accordingly, no allowance for credit losses was recorded as of December 31, 2025 , and 2024 , against these securities, and there was no provision for credit losses recognized for the years ended December 31, 2025 , 2024 and 2023 .

27 unchanged sentences

Securities AFS

treasury securities

$ 49,831 $ 20 $ — $ — $ 49,831 $ 20

government agency entities

7 unchanged sentences

$ 59,054 $ 1,067 $ 807,644 $ 120,978 $ 866,698 $ 122,045

As of December 31, 2024 , the Company had a total of 182 AFS securities in a gross unrealized loss position with no credit impairment, consisting primarily of 154 mortgage-backed securities, 16 corporate debt securities, nine U.S.

As of December 31, 2025 , the Company had a total of 159 AFS securities in a gross unrealized loss position with no credit impairment, consisting primarily of 138 mortgage-backed securities, ten U.S.

government agencies securities, eight corporate debt securities, and three collateralized mortgage obligations.

In comparison, as of December 31, 2024 , the Company had a total of 182 AFS securities in a gross unrealized loss position with no credit impairment, consisting primarily of 154 mortgage-backed securities, 16 corporate debt securities, nine U.S.

government agencies securities and three collateralized mortgage obligations.

In comparison, as of December 31, 2023 , the Company had a total of 192 AFS securities in a gross unrealized loss position with no credit impairment, consisting primarily of 154 mortgage-backed securities, 24 corporate debt securities, eight U.S.

government agencies securities, five collateralized mortgage obligations and one U.S.

treasury security.

AFS securities having a carrying value of $ 22.8 million and $ 17.8 million as of December 31, 2025 , and December 31, 2024 , respectively, were pledged to secure public deposits, and other borrowings.

Equity securities were $ 51.9 million and $ 34.4 million as of December 31, 2025 , and 2024 , respectively.

The Company recognized a net unrealized loss on equity securities of $ 7.5 million for the year ended December 31, 2024 .

The company recognized net unrealized gains on equity securities of $ 18.2 million and $ 0.3 million for the years ended December 31, 2023 and 2022 , respectively.

The Company received proceeds of $ 553 thousand and realized a loss of $ 101 thousand on the sale of equity securities for the year ended December 31, 2022.

The Company recognized a net unrealized gain on equity securities of $ 7.4 million, a net unrealized loss on equity securities of $ 7.5 million and net unrealized gains on equity securities of $ 18.2 million for the years ended December 31, 2025 , 2024 and 2023 , respectively.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

Most of the Company’s business activities are with clients located in the high-density Asian-populated areas of Southern and Northern California;

7 unchanged sentences

and Las Vegas, Nevada.

The Company also has loan clients in Hong Kong.

The Company also has clients in Hong Kong.

The Company has no specific industry concentration, and generally its loans, when secured, are secured by real property or other collateral of the borrowers.

The Company generally expects loans to be paid off from the operating profits of the borrowers, from refinancing by another lender, or through sale by the borrowers of the secured collateral.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

The following table presents the composition of the Company’s loans as of December 31, 2025 , and 2024 , were as follows:

19 unchanged sentences

Loans held for sale

The Company pledged real estate loans of $ 14.55 billion as of December 31, 2024 , and $ 14.15 billion as of December 31, 2023 , to the Federal Home Loan Bank of San Francisco under its blanket lien pledging program.

The Company pledged commercial loans of $ 474.8 million as of December 31, 2024 , and $ 388 thousand as of December 31, 2023 , to the Federal Reserve Bank’s Discount Window under the Borrower-in-Custody program.

Loans serviced for others as of December 31, 2024 , totaled $ 172.2 million and were comprised of $ 63.3 million of residential mortgages, $ 44.5 million of commercial real estate loans, $ 22.6 million of construction loans, and $ 41.8 million of commercial loans.

As of December 31, 2023 , loans serviced for others, totaled $ 203.0 million and were comprised of $ 70.7 million of residential mortgages, $ 76.1 million of commercial real estate loans, $ 11.8 million of construction loans and $ 44.4 million of commercial loans.

The Company pledged real estate loans of $ 15.11 billion and $ 14.55 billion as of December 31, 2025 , and 2024 , respectively, to the Federal Home Loan Bank of San Francisco under its blanket lien pledging program.

The Company pledged commercial loans of $ 1.42 billion, and $ 474.8 million as of December 31, 2025 , and 2024, respectively, to the Federal Reserve Bank’s Discount Window under the Borrower-in-Custody program.

Loans serviced for others as of December 31, 2025 , totaled $ 166.2 million and were comprised of $ 54.3 million of residential mortgages, $ 52.7 million of commercial loans, $ 49.0 million of commercial real estate loans, and $ 10.2 million of construction loans.

As of December 31, 2024 , loans serviced for others, totaled $ 172.2 million and were comprised of $ 63.3 million of residential mortgages, $ 44.5 million of commercial real estate loans, $ 41.8 million of commercial loans, and $ 22.6 million of construction loans.

The Company has entered into transactions with its directors, executive officers, or principal holders of its equity securities, or the associates of such persons (“related parties”).

31 unchanged sentences

Residential mortgage and equity lines

Installment and other loans

$ 164,882 $ 5

7 unchanged sentences

Residential mortgage and equity lines

Installment and other loans

$ 130,126 $ 197

15 unchanged sentences

Commercial real estate loans

Residential mortgage and equity lines

24,438 19,637 8,932

10 unchanged sentences

$ 56,022 $ 53,499 $ —

Construction loans

7,736 7,736 —

Commercial real estate loans

5 unchanged sentences

Commercial loans

$ 18,769 $ 6,267 $ 1,208

Commercial real estate loans

Residential mortgage and equity lines

7,786 7,435 29

$ 26,749 $ 13,895 $ 1,238

Total non-accrual loans

43 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

The Company has adopted ASU 2022 - 02, “Financial Instruments – Troubled Debt Restructurings and Vintage Disclosures” effective January 1, 2023.

As part of the adoption, the Company has elected to apply the pending content prospectively and the practical expedient to exclude the accrued interest receivable balance from the disclosed amortized cost basis of loan modifications to debtors experiencing financial difficulty, consistent with our Allowance for Credit Losses ("ACL") approach discussed further below in this footnote.

The Company has adopted ASU 2022 - 02, “Financial Instruments – Troubled Debt Restructurings and Vintage Disclosures”.

The Company has elected to apply the guidance prospectively and the practical expedient to exclude the accrued interest receivable balance from the disclosed amortized cost basis of loan modifications to debtors experiencing financial difficulty, consistent with our Allowance for Credit Losses ("ACL") approach discussed further below in this footnote.

The amendments in this guidance require that an entity evaluate whether the modification represents a new loan or a continuation of an existing loans.

The concessions may be granted in various forms, including a change in the stated interest rate, a reduction in the loan balance or accrued interest, or an extension of the maturity date.

The sustained performance considered by management pursuant to its policy included the periods prior to the modification if the prior performance met or exceeded the modified terms.

This would include cash paid by the borrower prior to the restructuring to set up interest reserves.

Loans classified as TDRs were reported as individually evaluated loans.

The allowance for credit loss on a TDR was measured using the same method as all other loans held for investment, except when the value of a concession could not be measured using a method other than the discounted cash flow method.

The amendments in this guidance require that an entity evaluate whether the modification represents a new loan or a continuation of an existing loan.

The Company establishes a specific reserve for individually evaluated loans that do not share similar risk characteristics with the loans included in the collective reserve.

2 unchanged sentences

If economic conditions or other factors worsen relative to the assumptions the Company utilized, the expected loan losses will increase accordingly in future periods.

As of December 31, 2022, under the prior TDR guidance, there was accruing TDRs of $ 15.1 million and non-accrual TDRs of $ 6.3 million.

As of December 31, 2022, the Company allocated zero in reserves to accruing TDRs and $ 427 thousand to non-accrual TDRs.

The following table presents TDRs that were modified during 2022, their specific reserve as of December 31, 2022, and charge-offs during 2022:

Loans Modified as TDRs During the Year Ended December 31, 2022

of Contracts Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment Specific Reserve Charge-offs

Modifications of the loan terms in the twelve months ended December 31, 2025 , 2024 , and 2023 were in the form of payment deferrals, term extensions, and interest rate reductions, or a combination thereof.

The following table presents the amortized cost of loans modified to borrowers experiencing financial difficulty disaggregated by class of financing receivable and type of concession granted and the financial effects of the modifications for the twelve months ended December 31, 2025 , 2024 , and 2023 by loan class and modification type:

Twelve Months Ended December 31, 2025

Financial Effects of Loan Modifications

Term Extension

Rate Reduction

Payment Delay

Combo-Rate Reduction/Term Extension/Payment Delay

Modification as a % of Loan Class

Weighted-Average Change in Rate

Weighted-Average Term Extension (in Years)

Weighted-Average Payment Deferral (in Years)

($ In thousands)

3 unchanged sentences

13,684 — — 3,686 17,370 0.16 % 0.00 1.1 0.1

Residential mortgage and equity lines

Construction loans

11,198 — — 26,060 37,258 11.04 % ( 0.31 ) 0.6 0.0

$ 36,902 $ — $ — $ 41,246 $ 78,148

Modifications of the loan terms in the twelve months ended December 31, 2024 , and December 31, 2023 , were in the form of payment deferrals, term extensions, and interest rate reductions, or a combination thereof.

The following table presents the amortized cost of loans modified to borrowers experiencing financial difficulty disaggregated by class of financing receivable and type of concession granted and the financial effects of the modifications for the twelve months ended December 31, 2024 , and 2023 , by loan class and modification type:

Twelve Months Ended December 31, 2024

14 unchanged sentences

$ 4,720 $ — $ 351 $ 4,092 $ 9,163

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

Twelve Months Ended December 31, 2023

14 unchanged sentences

$ — $ — $ 222 $ 2,650 $ 2,872

The Company considers a loan to be in payment default once it is 60 to 90 days contractually past due under the modified terms.

The Company tracks the performance of modified loans.

There were no loans that received a modification for the twelve months ended December 31, 2024 , and 2023 , that subsequently defaulted.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

The Company considers a loan to be in payment default once it is 60 to 90 days contractually past due.

A modified loan may become delinquent and may result in a payment default (generally 90 days past due) subsequent to modification.

There were no loans that received modifications which subsequently defaulted for the twelve months ended December 31, 2024 , and 2023 .

There were no loans that received a modification for the twelve months ended December 31, 2025, 2024, and 2023 that subsequently defaulted.

The Company closely monitors the performance of modified loans to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

6 unchanged sentences

$ 23,520 $ — $ — $ 23,520

Residential mortgage loans

Commercial real estate loans

17,370 — — 17,370

Construction loans

37,258 — — 37,258

$ 78,148 $ — $ — $ 78,148

Twelve Months Ended December 31, 2024

5 unchanged sentences

$ 9,163 $ — $ — $ 9,163

Twelve Months Ended December 31, 2023

30–89 Days Past Due

90+ Days Past Due

($ In thousands)

Commercial loans

$ 2,650 $ — $ — $ 2,650

Residential mortgage loans

$ 2,872 $ — $ — $ 2,872

Under the Company’s internal underwriting policy, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification in order to determine whether a borrower is experiencing financial difficulty.

45 unchanged sentences

— — — — — 17,843 — — 17,843

$ 1,941,874 $ 1,360,416 $ 1,758,888 $ 1,582,709 $ 1,382,164 $ 2,298,683 $ 230,077 $ 1,208 $ 10,556,019

YTD gross write-offs

109 unchanged sentences

$ 7,780 $ 1,896 $ — $ — $ — $ 9,676

Provision/(reversal) for expected credit losses

Provision for expected credit losses

1,287 1,199 279 — — 2,765

7 unchanged sentences

To determine whether or not a variable interest the Company holds could potentially be significant to the VIE, the Company considers both qualitative and quantitative factors regarding the nature, size and form of the Company's involvement with the VIE.

While the Company has determined that its interests in these entities meet the definition of a variable interest in accordance with ASC 810, the Company has determined that the Company is not the primary beneficiary in all but eleven of these partnerships because the Company does not have the power to direct the activities that most significantly impact the economic performance of the entities including operational and credit risk management activities.

While the Company has determined that its interests in these entities meet the definition of a variable interest in accordance with ASC 810, the Company has determined that the Company is not the primary beneficiary in all but twelve of these partnerships because the Company does not have the power to direct the activities that most significantly impact the economic performance of the entities including operational and credit risk management activities.

As the Company is not the primary beneficiary, the Company did not consolidate the entities.

8 unchanged sentences

$ 17,582 $ 17,740

Investments in affordable housing and alternative energy partnerships, unfunded commitments

Investments in affordable housing unfunded commitments

$ 89,281 $ 99,521

1 unchanged sentence

$ 8,062 $ 12,044

The consolidation of these limited partnerships in the Company’s Consolidated Financial Statements increased total assets and liabilities by $ 26.9 million as of December 31, 2025 , and by $ 26.0 million as of December 31, 2024 .

1 unchanged sentence

Investments in alternative energy partnerships were $ 8.1 million and $ 12.0 million as of December 31, 2025 , and 2024 , respectively.

As of December 31, 2024 , and 2023 , $ 0.3 million and $ 6.4 million, respectively, of this investment were in an escrow account with a major bank.

Unfunded commitments for affordable housing limited partnerships and alternative energy tax credit partnerships were recorded under other liabilities.

As of December 31, 2025 , the Company did not have any remaining balance in escrow related to alternative energy partnerships and $ 0.3 million, as of December 31, 2024, of this investment was in an escrow account with a major bank.

Unfunded commitments for affordable housing limited partnerships was recorded under other liabilities.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

As of December 31, 2024 , the Company’s unfunded commitments related to investments in qualified affordable housing and alternative energy partnerships, net, are estimated to be paid as follows:

As of December 31, 2025 , the Company’s unfunded commitments related to investments in qualified affordable housing partnerships, net, are estimated to be paid as follows:

Year Ending December 31,

1 unchanged sentence

Total unfunded commitments

Each of the partnerships must meet regulatory requirements for affordable housing and alternative energy projects, including long-term minimum compliance periods (such as a 15 -year minimum compliance period for certain affordable housing tax credits) to fully utilize the tax credits.

Each of the partnerships must meet regulatory requirements for affordable housing, including long-term minimum compliance periods (such as a 15 -year minimum compliance period for certain affordable housing tax credits) to fully utilize the tax credits.

If the partnerships cease to qualify during the compliance period, the credits may be denied for any period in which the projects are not in compliance and a portion of the credits previously taken is subject to recapture with interest.

2 unchanged sentences

The risk of not being able to realize the tax credits and other returns depends on many factors, including changes in the applicable provisions of the tax code, the ability of the projects to be completed and properly managed and other factors that are outside of our control.

Losses in excess of the Bank’s investment in three limited partnerships have not been recorded in the Company’s Consolidated Financial Statements because the Company had fully satisfied all capital commitments required under the respective limited partnership agreements.

In 2025 and 2024 , non-interest expense included $ 7.0 million and $ 6.1 million in impairment charges for investments in low-income housing partnerships.

41 unchanged sentences

$ 2,000 $ 2,946

There were $ 0.1 million, $ 0.3 million and $ 0.9 million in impairment write-down on core deposit intangibles during the year of December 31, 2024 , 2023 and 2022 , respectively, included in amortization of core deposit intangibles on the Consolidated Statements of Operations and Comprehensive Income.

There was no impairment write-down on core deposit intangibles during the year of December 31, 2025 .

There were $ 0.1 million and $ 0.3 million in impairment write-down on core deposit intangibles during the year of December 31, 2024 and 2023 , respectively, included in amortization of core deposit intangibles on the Consolidated Statements of Operations and Comprehensive Income.

The Company amortizes the core deposit intangibles based on the projected useful lives of the related deposits.

The amortization expense related to the core deposit intangible assets was $ 1.1 million, $ 1.3 million and $ 1.9 million for the years ended December 31, 2024 , 2023 and 2022 , respectively.

The amortization expense related to the core deposit intangible assets were $ 0.9 million, $ 1.1 million and $ 1.3 million for the years ended December 31, 2025 , 2024 and 2023 , respectively.

($ In thousands)

4 unchanged sentences

$ 3,505,606 $ 3,284,342

Interest bearing demand deposits

2,370,047 2,205,695

16 unchanged sentences

($ In thousands)

Interest bearing demand

$ 36,493 $ 44,899 $ 40,952

14 unchanged sentences

As of December 31, 2025 , and 2024 , there were no over-night borrowings from the FHLB.

As of December 31, 2024 , all advances from the FHLB were $ 60.0 million at a weighted average rate of 5.08 % and $ 540.0 million at a weighted average rate of 5.64 % as of December 31, 2023 .

As of December 31, 2024 , final maturity for the FHLB advances were $ 60.0 million that will mature in February 2025.

There were no advances from the FHLB as of December 31, 2025 , and $ 60.0 million at a weighted average rate of 5.08 % as of December 31, 2024 .

Our unused borrowing capacity from the Federal Home Loan Bank as of December 31, 2025 , was $ 7.89 billion and unpledged securities at December 31, 2025 , was $ 1.64 billion.

22 unchanged sentences

Interest expense on the Junior Subordinated Notes was $ 8.0 million, $ 8.1 million, and $ 6.5 million for years ended December 31, 2025 , 2024 and 2023 , respectively.

Included in the 2022 and 2023 interest expense is the amortization of the gain on cash flow interest rate swaps, early terminated in 2022.

Included in the 2023 interest expense is the amortization of the gain on cash flow interest rate swaps, early terminated in 2022.

Capital Resources

Total equity was $ 2.85 billion as of December 31, 2024 , an increase of $ 109.1 million, or 4.0 %, from $ 2.74 billion at December 31, 2023 , primarily due to net income of $ 286.0 million, stock based compensation of $ 6.0 million, proceeds from dividend reinvestment of $ 2.9 million, and stock issued to directors of $ 0.9 million, offset by common stock cash dividends of $ 98.0 million, purchases of treasury stock of $ 84.7 million, shares withheld related to net share settlement of RSU’s of $ 3.7 million, and other comprehensive loss of $ 0.2 million.

The Company paid cash dividends of $ 1.36 per common share in 2024 , $ 1.36 per common share in 2023 , and $ 1.36 per common share in 2022 .

On May 28th, 2024, the Company announced a new stock repurchase program to buy back up to $ 125.0 million of the Company's common stock.

The previous $ 125.0 million share repurchase program announced on May 26, 2022, was completed on February 21, 2023, with the repurchase of 2,897,628 shares at an average cost of $ 43.14 .

Through December 31, 2024 , the Company repurchased 2,028,581 shares of common stock for a total of $ 83.9 million, at an average cost of $ 41.37 per share under the May 2024 buyback program.

Total equity was $ 2.93 billion as of December 31, 2025 , an increase of $ 79.7 million, or 2.8 %, from $ 2.85 billion at December 31, 2024 , primarily due to net income of $ 315.1 million, other comprehensive income of $ 31.2 million, stock based compensation of $ 6.6 million, proceeds from dividend reinvestment of $ 2.6 million, and stock issued to directors of $ 1.0 million, offset by purchases of treasury stock of $ 180.3 million, common stock cash dividends of $ 93.8 million, and shares withheld related to net share settlement of RSU’s of $ 2.8 million.

The Company paid cash dividends of $ 1.36 per common share in 2025 , 2024 , and in 2023 .

On June 4, 2025, the Company announced a new stock repurchase program to buy back up to $ 150.0 million of the Company's common stock.

The previous $ 125.0 million stock repurchase program announced on May 28, 2024, was completed on February 28, 2025, with the repurchase of a total of 2,905,487 shares at an average cost of $ 43.02 .

Under the new stock repurchase program, through December 31, 2025 , the Company repurchased 2,973,982 common shares at an average cost of $ 46.24 per share, for a total of $ 137.5 million under the current stock repurchase program.

The five special purpose trusts established for the purpose of issuing the Capital Securities are considered variable interest entities.

72 unchanged sentences

Depreciation and amortization

Investment in affordable housing partnerships

Unrealized loss on securities available-for-sale, net

5 unchanged sentences

Deferred Tax Liabilities

Investment in partnerships

$ ( 5,531 ) $ —

Deferred loan costs

24 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

The Company had current income tax receivables of $ 37.0 million as of December 31, 2024 , and $ 33.7 million as of December 31, 2023 .

The Company had current income tax receivable of $ 13.3 million as of December 31, 2025 , and $ 37.0 million as of December 31, 2024 .

The Company had $ 2.9 million of tax credits generated in 2025 that will be carried forward to 2026.

1 unchanged sentence

The Company’s tax returns are open for audits by the Internal Revenue Service back to 2022 and by the California Franchise Tax Board back to 2021 .

The Company is currently under audit by the California Franchise Tax Board for 2020 .

It is reasonably possible that unrecognized tax benefits could change significantly over the next twelve months.

The Company does not expect that any such changes would have a material impact on its annual effective tax rate.

Income tax expense results in effective tax rates that differ from the statutory federal income tax rate for the years indicated as follows:

Income tax expense from continuing operations results in effective tax rates that differ from the statutory federal income tax rate for the years indicated as follows:

Year Ended December 31,

($ In thousands)

Tax provision at Federal statutory rate

US federal income tax rate expense computed at the statutory rate

$ 81,942 21.0 % $ 66,684 21.0 % $ 84,752 21.0 %

State income taxes, net of Federal income tax benefit

Domestic Federal

Low-income housing tax credits

( 40,179 ) ( 10.3 ) ( 35,448 ) ( 11.1 ) ( 32,395 ) ( 8.1 )

Excess deduction for stock option and RSUs

Solar investment tax credits

— — ( 28,517 ) ( 9.0 ) ( 41,320 ) ( 10.2 )

Low income housing and other tax credits

Non-taxable and non-deductible items

1,867 0.5 2,060 0.6 3,231 0.8

( 67 ) — ( 648 ) ( 0.2 ) ( 917 ) ( 0.2 )

Total income tax expense

Domestic State and Local Income Taxes, Net of Federal Income Tax Effect (1)

31,511 8.0 27,432 8.6 36,107 9.0

Income tax expense and effective tax rate, as reported

$ 75,074 19.2 % $ 31,563 9.9 % $ 49,458 12.3 %

(1) State and local income taxes in California, New York State and New York City comprise the majority (greater than 50 percent) of the tax effect in this category for years 2025, 2024 and 2023.

The table below shows income tax paid, net of refunds received, by jurisdiction for the years indicated as follows:

Year Ended December 31,

($ In thousands)

Federal income tax

$ 4,147 $ 16,000 $ 18,200

State and local income tax

$ 16,326 $ 24,000 $ 30,500

New York State

5,876 10,282 11,800

New York City

10,000 5,000 8,700

1,349 863 1,112

Total State and local income tax

$ 33,551 $ 40,145 $ 52,112

Total income tax paid

$ 37,698 $ 56,145 $ 70,312

CATHAY GENERAL BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

Stockholders ’ Equity and Earnings per Share

18 unchanged sentences

44,303 13,096 31,207 24 7 17

Reclassification adjustment for net gains/(losses) in net income

Reclassification adjustment for net losses in net income

Securities AFS

8 unchanged sentences

$ 44,303 $ 13,096 $ 31,207 $ ( 271 ) $ ( 80 ) $ ( 191 )

Ending balance, gain/(loss), net of tax

Ending balance, loss, net of tax

Securities AFS

45 unchanged sentences

$ 4,351,186 $ 3,922,412

$ 3,922,412 $ 4,188,546

Commitments to extend credit are agreements to lend to a client provided there is no violation of any condition established in the commitment agreement.

5 unchanged sentences

As of December 31, 2025 , commitments to extend credit of $ 3.81 billion include commitments to fund fixed rate loans of $ 48.4 million and adjustable-rate loans of $ 3.76 billion.

As of December 31, 2023 , commitments to extend credit of $ 3.81 billion and included commitments to fund fixed rate loans of $ 130.3 million and adjustable-rate loans of $ 3.69 billion.

As of December 31, 2024 , commitments to extend credit of $ 3.47 billion included commitments to fund fixed rate loans of $ 63.4 million and adjustable-rate loans of $ 3.41 billion.

Commercial letters of credit and bill of lading guarantees are issued to facilitate domestic and foreign trade transactions while standby letters of credit are issued to make payments on behalf of clients if certain specified future events occur.

56 unchanged sentences

The Company records credit valuation adjustments on derivatives to properly reflect the variances of credit worthiness between the Company and the counterparties, considering the effects of enforceable master netting agreements and collateral arrangements.

As of December 31, 2024 , and 2023 , the Company had outstanding interest rate derivative contracts with certain clients and third -party financial institutions with a notional amount of $ 680.5 million and $ 650.9 million, respectively, with a fair value of $ 32.7 million and $ 38.6 million, respectively, for both clients and third -party financial institutions.

As of December 31, 2025 , and 2024 , the Company had outstanding interest rate derivative contracts with certain clients and third -party financial institutions with a notional amount of $ 1.02 billion and $ 680.5 million, respectively, with a fair value of $ 24.0 million and $ 32.7 million, respectively, for both clients and third -party financial institutions.

As of December 31, 2025 , and 2024 , for borrower swap transactions, there were no notional amount of interest rate swaps cleared through the CCP.

6 unchanged sentences

As of December 31, 2025 , and 2024 , the ineffective portion of these interest rate swaps was not significant.

The Company has designated as a partial-term hedging election $ 793.8 million and $ 1.07 billion notional with a fair value of $ 321 thousand and $ 3.8 million as last-of-layer hedge on pools of loans with a notational value of $ 1.32 billion and $ 1.78 billion as of December 31, 2024 , and 2023 , respectively.

The Company has designated as a partial-term hedging election $ 577.6 million and $ 793.80 million notional with a fair value loss of $ 4.0 million and $ 321 thousand as last-of-layer hedge on pools of loans with a notational value of $ 882.1 million and $ 1.32 billion as of December 31, 2025 , and 2024 , respectively.

The loans are not expected to be affected by prepayment, defaults, or other factors affecting the timing and amount of cash flows under the last-of-layer method.

The Company has entered into these pay-fixed and receive 1 -Month Term SOFR interest rate swaps to convert the last-of-layer $ 793.8 million portion of a $ 1.32 billion fixed rate loan pools in order to reduce the Company’s exposure to higher interest rates for the last-of-layer tranches.

The Company has entered into these pay-fixed and receive 1 -Month Term SOFR interest rate swaps to convert the last-of-layer $ 577.6 million portion of a $ 882.1 million fixed rate loan pools in order to reduce the Company’s exposure to higher interest rates for the last-of-layer tranches.

As of December 31, 2025 , and 2024 , the last-of-layer loan tranche had a net fair value basis adjustment of $ 5.0 million and $ 1.2 million, respectively.

18 unchanged sentences

4.41 % 5.36 %

Net gain/(loss) (1)

Net (loss)/gain (1)

$ ( 2,417 ) $ 3,644

7 unchanged sentences

( 2 ) the amount of periodic net settlement of interest rate swaps was included in interest income.

Included in the total notional amount of $ 875.1 million and $ 1.16 billion of the fair value hedge contracts entered into with financial counterparties as of December 31, 2024 , and 2023 , was a notional amount of $ 572.8 million and $ 846.9 million of interest rate swaps that cleared through the CCP, respectively.

Applying variation margin payments as settlement to CCP cleared derivative transactions resulted in a reduction in derivative asset fair values of $ 158 thousand and $ 257 thousand as of December 31, 2024 , and 2023 , respectively.

Included in the total notional amount of $ 625.2 million and $ 875.1 million of the fair value hedge contracts entered into with financial counterparties as of December 31, 2025 , and 2024 , was a notional amount of $ 571.2 million and $ 572.8 million of interest rate swaps that cleared through the CCP, respectively.

Applying variation margin payments as settlement to CCP cleared derivative transactions resulted in a reduction in derivative asset fair values of $ 3.4 million and $ 158 thousand as of December 31, 2025 , and 2024 , respectively.

The Company enters into foreign exchange forward contracts with various counterparties to mitigate the risk of fluctuations in foreign currency exchange rates for foreign exchange certificates of deposit or foreign exchange contracts entered into with our clients.

40 unchanged sentences

Government sponsored entities, state and municipal securities, mortgage-backed securities (“MBS”), collateralized mortgage obligations and corporate bonds.

The Company measures the fair value of warrants based on unobservable inputs based on assumptions and management judgment, a Level 3 measurement.

CATHAY GENERAL BANCORP AND SUBSIDIARIES

13 unchanged sentences

— 5,822 — 5,822

government sponsored entities

— 25,011 — 25,011

Mortgage-backed securities

102 unchanged sentences

— — 15,320 15,320 4,049 4,069

Residential mortgage and equity lines

— — 243 243 59 —

Total non-accrual loans

2 unchanged sentences

— — 24,126 24,126 — —

Other equity securities

— — 1,539 1,539 — —

Investments in venture capital

15 unchanged sentences

The significant unobservable inputs (Level 3 ) used in the fair value measurement of other real estate owned (“OREO”) are primarily based on the appraised value of OREO adjusted by estimated sales cost and commissions.

The Company applies estimated sales cost and commissions ranging from 3 % to 6 % of the collateral value of individually evaluated loans, quoted price, or loan sale price of loans held for sale, and appraised value of OREO.

The Company applies estimated sales cost and commissions of 5 % of the collateral value of individually evaluated loans, quoted price, or loan sale price of loans held for sale, and appraised value of OREO.

Fair value is estimated in accordance with ASC Topic 825.

61 unchanged sentences

Advances from Federal Home Loan Bank

59,606 — 59,606 —

Other borrowings

86 unchanged sentences

Equity Incentive Plans

Pursuant to the Company’s 2005 Incentive Plan, as amended and restated in May 2015, the Company may grant incentive stock options (employees only), non-statutory stock options, common stock awards, restricted stock, RSUs, stock appreciation rights and cash awards to non-employee directors and eligible employees.

Pursuant to the Company’s 2005 Incentive Plan, as amended and restated in May 2025 ( the "2005 Incentive Plan"), the Company may grant incentive stock options (employees only), non-statutory stock options, common stock awards, restricted stock, RSUs, stock appreciation rights and cash awards to non-employee directors and eligible employees.

As of December 31, 2025 , 2,770,049 shares were available under the 2005 Incentive Plan for future grants.

104 unchanged sentences

Write-downs on venture capital and other investments

Loss/(gain) in fair value of warrants

Loss in fair value of warrants

Stock issued to directors as compensation

1,020 850 850

Net change in accrued interest receivable and other assets

6 unchanged sentences

Venture capital and other investments

Net cash provided/(used) by investment activities

Net cash provided by investment activities

Cash flows from Financing Activities

9 unchanged sentences

( 274,257 ) ( 183,463 ) ( 116,304 )

Increase/(decrease) in cash, cash equivalents and restricted cash

(Decrease)/Increase in cash, cash equivalents and restricted cash

( 33,267 ) 25,912 9,360

85 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures