What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-02-28 compared with 2024-02-29 · 657 added, 694 removed, 2006 unchanged (40% of the section changed)

2 unchanged sentences

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Balance Sheet

Consolidated Balance Sheets

Consolidated Statement of Income

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2 — Fair Value Measurement and Fair Value of Financial Instruments

3 — Assets Purchased under Resale Agreements and Sold under Repurchase Agreements

3 — Securities Purchased under Resale Agreements

4 — Securities

1 unchanged sentence

6 — Loans Receivable and Allowance for Credit Losses

7 — Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net and Variable Interest Entities

7 — Affordable Housing Partnerships, Tax Credit and Community Reinvestment Act Investments, Net

10 — Short-Term Borrowings and Long-Term Debt

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1 4 — Stockholders’ Equity and Earnings Per Share

1 5 — Accumulated Other Comprehensive Income (Loss)

15 — Accumulated Other Comprehensive (Loss) Income

1 6 — Regulatory Requirements and Matters

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The Company measured the expected credit losses on a collective pool basis when similar risk characteristics existed.

The December 31, 2023 commercial collective ALL included quantitative and qualitative components (together, the collective ALL).

The Company developed and documented the collective ALL methodology at the portfolio segment level.

The collective ALL methodology used various models and estimation techniques based on the Company’s historical loss experience, current borrower characteristics, which included internal risk ratings, current conditions, and reasonable and supportable macroeconomic forecasts.

The December 31, 2024 commercial collective ALL included quantitative and qualitative components.

The Company developed and documented the commercial collective ALL methodology at the portfolio segment level.

The commercial collective ALL methodology used various models and estimation techniques based on the Company’s historical loss

experience, current borrower characteristics, which included internal risk ratings, current conditions, and reasonable and supportable macroeconomic forecasts.

The commercial loan portfolio is comprised of commercial and industrial (C&I) and commercial real estate (CRE), which also included multifamily residential, and construction and land loans.

The Company’s C&I lifetime loss rate model estimated credit losses by estimating a loss rate expected over the life of a loan

which is applied to the amortized cost basis, excluding accrued interest receivables, to determine expected credit losses.

The Company’s CRE projected probability of defaults (“PDs”) and loss given defaults (“LGDs”) are applied to the estimated exposure at default, considering the term and payment structure of the loan, to generate estimates of expected loss.

The Company’s C&I lifetime loss rate model estimated credit losses by estimating a loss rate expected over the life of a loan which is applied to the amortized cost basis, excluding accrued interest receivables, to determine expected credit losses.

The Company’s CRE model applies projected probability of defaults (“PDs”) and loss given defaults (“LGDs”) to the estimated exposure at default, considering the term and payment structure of the loan, to generate estimates of expected loss.

The Company incorporated forward-looking information using macroeconomic scenarios, which included variables that are considered key drivers of increases and decreases in credit losses.

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A high degree of audit effort, including specialized skills and knowledge, and subjective and complex auditor judgment was involved in the assessment due to significant measurement uncertainty.

Specifically, the assessment encompassed the evaluation of the collective ALL methodology, including an evaluation of the conceptual soundness and performance of the methods and models used to estimate (1) the quantitative component and its significant data elements and assumptions, which included portfolio segments, historic loss experience, reasonable and supportable forecast period, internal risk ratings, probability-weighted macroeconomic forecast scenarios, contractual term of the loan adjusted for estimated prepayments, and (2) the qualitative component.

Specifically, the assessment encompassed the evaluation of the commercial collective ALL methodology, including an evaluation of the conceptual soundness and performance of the methods and models used to estimate (1) the quantitative component and its significant data elements and assumptions, which included portfolio segments, historic loss experience, reasonable and supportable forecast period, internal risk ratings, probability-weighted macroeconomic forecast scenarios, contractual term of the loan adjusted for estimated prepayments, and (2) the qualitative component.

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

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s measurement of the collective ALL estimates, including controls over the:

• development of the collective ALL methodology

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s measurement of the commercial collective ALL estimates, including controls over the:

• development of the commercial collective ALL methodology

• continued use and appropriateness of changes made to the quantitative models

• performance monitoring of the quantitative models for the December 31, 2023 commercial collective ALL

• performance monitoring of the quantitative models

• identification and determination of the significant data elements and assumptions used in the quantitative models

• development of the qualitative component

• analysis of the collective ALL results, trends, and ratios.

We evaluated the Company’s process to develop the collective ALL estimates by testing the models, significant data elements and assumptions that the Company used, and considered the relevance and reliability of such models, data, factors, and assumptions.

We performed ratio and trend analysis over key ratios and peer comparison information relevant to the collective ALL.

• analysis of the commercial collective ALL results, trends, and ratios.

We evaluated the Company’s process to develop the commercial collective ALL estimates by testing the models, significant data elements and assumptions that the Company used, and considered the relevance and reliability of such models, data, factors, and assumptions.

We performed ratio and trend analysis over key ratios and peer comparison information relevant to the commercial collective ALL.

In addition, we involved credit risk professionals with specialized skills and knowledge, who assisted in:

• evaluating the Company’s collective ALL methodology for compliance with U.S.

• evaluating the Company’s commercial collective ALL methodology for compliance with U.S.

generally accepted accounting principles

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• determining whether the loan portfolio is pooled based on loans with similar risk characteristics by comparing to the Company’s business environment and relevant industry practices

• evaluating risk ratings for a selection of collectively evaluated loans

• evaluating the conceptual soundness of the framework used to develop the qualitative factors and the effect of those factors on the collective ALL compared with relevant credit risk factors and consistency with credit trends and identified limitations of the underlying quantitative models.

We also assessed the sufficiency of the audit evidence obtained related to the collective ALL estimates by evaluating the:

• evaluating risk ratings for a selection of collectively evaluated commercial loans

• evaluating the conceptual soundness of the framework used to develop the qualitative factors and the effect of those factors on the commercial collective ALL compared with relevant credit risk factors and consistency with credit trends and identified limitations of the underlying quantitative models.

We also assessed the sufficiency of the audit evidence obtained related to the commercial collective ALL estimates by evaluating the:

• cumulative results of audit procedures

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Interest-bearing deposits with banks 48,198 10,498

Assets purchased under resale agreements (“resale agreements”) 785,000 792,192

Available-for-sale (“AFS”) debt securities, at fair value (amortized cost of $ 6,916,491 and $ 6,879,225 )

Securities purchased under resale agreements (“resale agreements”) 425,000 785,000

Debt securities:

Available-for-sale (“AFS”), at fair value (amortized cost of $ 11,505,775 and $ 6,916,491 )

10,846,811 6,188,337

Held-to-maturity (“HTM”) debt securities, at amortized cost (fair value of $ 2,453,971 and $ 2,455,171 )

Held-to-maturity (“HTM”), at amortized cost (fair value of $ 2,387,754 and $ 2,453,971 )

2,917,413 2,956,040

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53,024,585 51,542,039

Investments in qualified affordable housing partnerships, tax credit and other investments, net 905,036 763,256

Affordable housing partnership, tax credit and Community Reinvestment Act (“CRA”) investments, net 926,640 905,036

Premises and equipment (net of accumulated depreciation of $ 166,154 and $ 157,622 )

82,233 86,370

Goodwill 465,697 465,697

Operating lease right-of-use assets 81,967 94,024

Goodwill 465,697 465,697

Other assets 1,907,189 1,964,743

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Total deposits 63,175,023 56,092,438

Short-term borrowings 4,500,000 —

Assets sold under repurchase agreements (“repurchase agreements”) — 300,000

Bank Term Funding Program (“BTFP”) borrowings — 4,500,000

Federal Home Loan Bank (“FHLB”) advances 3,500,000 —

Long-term debt and finance lease liabilities 35,974 153,011

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449,065 276,190 198,906

Resale agreements 20,164 29,767 32,239

Assets purchased under resale agreements 11,254 20,164 29,767

Restricted equity securities 10,104 4,062 3,144

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Federal funds purchased and other short-term borrowings 42,163 157,002 1,801

Federal Home Loan Bank (“FHLB”) advances 6,430 1,754 6,881

Repurchase agreements 1,497 14,362 7,999

FHLB advances 147,269 6,430 1,754

Securities sold under repurchase agreements (“repurchase agreements”) 197 1,497 14,362

Long-term debt and finance lease liabilities 4,677 11,072 5,595

Total interest expense 1,914,480 1,381,551 275,350

Net interest income before provision for (reversal of) credit losses 2,312,254 2,045,881 1,531,571

Provision for (reversal of) credit losses 125,000 73,500 ( 35,000 )

Net interest income after provision for (reversal of) credit losses 2,187,254 1,972,381 1,566,571

Net interest income before provision for credit losses 2,278,716 2,312,254 2,045,881

Provision for credit losses 174,000 125,000 73,500

Net interest income after provision for credit losses 2,104,716 2,187,254 1,972,381

NONINTEREST INCOME

Lending fees 83,876 79,208 77,704

Deposit account fees 103,880 93,811 95,177

Customer derivative income

20,200 29,057 22,913

Lending fees 98,455 83,876 79,208

Foreign exchange income 54,605 48,276 41,416

Wealth management fees 38,627 26,994 27,738

Customer derivative income 16,401 20,200 29,057

Net gains on sales of loans 44 3,634 6,411

Net (losses) gains on AFS debt securities

Net gains (losses) on AFS debt securities

2,069 ( 6,862 ) 1,306

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Occupancy and equipment expense 64,399 62,763 62,501

Deposit insurance premiums and regulatory assessments 103,308 19,449 17,563

Deposit account expense 47,390 43,143 25,508

Computer software and data processing expenses

44,475 42,776 46,863

Computer and software related expenses 47,271 44,475 42,776

Deposit insurance premiums and regulatory assessments 45,736 103,308 19,449

Other operating expense 148,301 140,222 118,166

Amortization of tax credit and other investments 120,299 113,358 122,457

Amortization of tax credit and CRA investments 54,242 120,299 113,358

Total noninterest expense 958,073 1,022,748 859,393

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Net changes in unrealized gains (losses) on AFS debt securities 48,845 81,763 ( 508,799 )

81,763 ( 508,799 ) ( 137,950 )

Reclassification of unrealized losses on debt securities transferred from AFS to HTM — — ( 112,991 )

Amortization of unrealized losses on debt securities transferred from ASF to HTM 10,884 11,171 12,678

Net changes in unrealized gains (losses) on cash flow hedges

Net changes in unrealized (losses) gains on cash flow hedges

( 23,411 ) 52,155 ( 49,788 )

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Other comprehensive income (loss) 35,336 145,033 ( 675,248 )

145,033 ( 675,248 ) ( 134,706 )

COMPREHENSIVE INCOME $ 1,200,922 $ 1,306,194 $ 452,835

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Common Stock and Additional Paid-in Capital

Retained Earnings

Treasury Stock

AOCI, Net of Tax

Total Stockholders’ Equity

Shares Amount

Shares Amount Retained Earnings Treasury Stock AOCI, Net of Tax Total Stockholders’ Equity

BALANCE, DECEMBER 31, 2021 141,907,954 $ 1,893,725 $ 4,683,659 $ ( 649,785 ) $ ( 90,381 ) $ 5,837,218

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Other comprehensive loss — — — — ( 675,248 ) ( 675,248 )

— — — — ( 134,706 ) ( 134,706 )

Issuance of common stock pursuant to various stock compensation plans and agreements 671,871 42,832 — — — 42,832

Repurchase of common stock pursuant to various stock compensation plans and agreements ( 246,462 ) — — ( 19,087 ) — ( 19,087 )

Repurchase of common stock pursuant to the stock repurchase program ( 1,385,517 ) — — ( 99,990 ) — ( 99,990 )

Cash dividends on common stock ($ 1.60 per share)

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BALANCE, DECEMBER 31, 2022 140,947,846 $ 1,936,557 $ 5,582,546 $ ( 768,862 ) $ ( 765,629 ) $ 5,984,612

Cumulative-effect of change in accounting principle (1)

— — ( 4,262 ) — — ( 4,262 )

Net income — — 1,161,161 — — 1,161,161

Other comprehensive loss — — — — ( 675,248 ) ( 675,248 )

Other comprehensive income — — — — 145,033 145,033

Issuance of common stock pursuant to various stock compensation plans and agreements 913,185 44,430 — — — 44,430

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Other comprehensive income — — — — 35,336 35,336

— — — — 145,033 145,033

Issuance of common stock pursuant to various stock compensation plans and agreements 553,149 49,895 — — — 49,895

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Troubled Debt Restructurings and the Vintage Disclosures on January 1, 2023.

(2) Represents the impact of the adoption of ASU 2023-02 , Investments - Equity Method and Joint Ventures (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method on January 1, 2024.

Refer to Note 1 — Summary of Significant Accounting Policies to the Consolidated Financial Statements in this Annual Report on Form 10-K (“this Form 10-K”) for additional information.

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Adjustments to reconcile net income to net cash provided by operating activities:

Provision for (reversal of) credit losses 125,000 73,500 ( 35,000 )

Provision for credit losses 174,000 125,000 73,500

Depreciation and amortization 198,447 163,460 159,851

Accretion of discount and (amortization of premiums), net 10,723 56,703 67,415

Amortization of premiums (accretion of discount), net 13,891 10,723 56,703

Stock compensation costs 45,535 39,867 37,601

Deferred income tax (benefit) expense

( 49,139 ) ( 43,988 ) 4,762

Deferred income tax benefit ( 14,283 ) ( 49,139 ) ( 43,988 )

Net gains on sales of loans ( 44 ) ( 3,634 ) ( 6,411 )

Net losses (gains) on AFS debt securities

6,862 ( 1,306 ) ( 1,568 )

Net gains on sales of other real estate owned ("OREO") and other foreclosed assets ( 3,451 ) ( 3,042 ) ( 1,977 )

Impairment on OREO and other foreclosed assets — 6,861 5,151

Net (gains) losses on AFS debt securities ( 2,069 ) 6,862 ( 1,306 )

Impairment on other real estate owned (“OREO”) and other foreclosed assets 7,735 — 6,861

Net gains on sales of OREO and other foreclosed assets ( 460 ) ( 3,451 ) ( 3,042 )

Loans held-for-sale:

Originations and purchases ( 116 ) ( 447 ) ( 11,155 )

( 2,881 ) ( 116 ) ( 447 )

Proceeds from sales and paydowns/payoffs of loans originally classified as held-for-sale 3,020 — 461

Proceeds from distributions received from equity method investees 11,282 7,586 13,117

Distributions received from equity method investees 5,645 11,282 7,586

Net change in accrued interest receivable and other assets 63,743 ( 146,270 ) 187,512

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Other operating activities, net ( 3,755 ) 3,860 1,673

3,860 1,673 558

Total adjustments 246,081 263,748 937,939

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Net (increase) decrease in:

Investments in qualified affordable housing partnerships, tax credit and other investments ( 228,550 ) ( 167,303 ) ( 189,836 )

Affordable housing partnership, tax credit and CRA investments ( 378,305 ) ( 228,550 ) ( 167,303 )

Interest-bearing deposits with banks ( 38,352 ) 128,523 596,994

Resale agreements:

Assets purchased under resale agreements:

Proceeds from paydowns and maturities 360,000 219,917 1,951,388

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Proceeds from sales of OREO and other foreclosed assets 33,055 3,721 6,482

Purchase of bank-owned life insurance — ( 734 ) ( 150,000 )

Distributions received from equity method investees 23,598 23,774 18,221

Purchases of FHLB stock, net ( 84,079 ) — —

Other investing activities, net ( 14,704 ) ( 112,036 ) ( 8,454 )

( 112,036 ) ( 7,720 ) ( 4,763 )

Net cash used in investing activities ( 6,295,203 ) ( 4,247,161 ) ( 4,582,892 )

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CASH FLOWS FROM FINANCING ACTIVITIES

Net increase in deposits 144,468 2,709,427 8,464,285

Net increase (decrease) in short-term borrowings 4,500,000 6 ( 21,143 )

Net change in deposits 7,108,377 144,468 2,709,427

Net change in short-term borrowings ( 4,500,000 ) 4,500,000 6

FHLB advances:

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Long-term debt and lease liabilities:

Repayments of long-term debt and lease liabilities ( 871 ) ( 943 ) ( 1,206 )

Repayment of junior subordinated debt and lease liabilities ( 117,437 ) ( 871 ) ( 943 )

Common stock:

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Repurchase of common stock pursuant to the stock repurchase program ( 143,082 ) ( 82,174 ) ( 99,990 )

( 82,174 ) ( 99,990 ) —

Cash dividends paid ( 308,478 ) ( 274,554 ) ( 228,381 )

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NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 635,758 1,133,200 ( 431,151 )

1,133,200 ( 431,151 ) ( 105,036 )

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 4,614,984 3,481,784 3,912,935

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Securities transferred from AFS to HTM debt securities $ — $ — $ 3,010,003

Loans transferred to OREO $ 11,141 $ 270 $ 49,485

Loans transferred to OREO or other foreclosed assets $ 67,379 $ 11,141 $ 270

See accompanying Notes to Consolidated Financial Statements.

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As of December 31, 2024, the Company operated i n over 110 locations in the United States (“U.S.”) and Asia.

In the U.S., the Bank’s corporate headquarters and main administrative offices a located in California, and its branches and offices are located in California, Texas, New York, Washington, Georgia, Massachusetts, Illinois, and Nevada.

In the U.S., the Bank’s corporate headquarters and main administrative offices are located in California, and its branches and offices are located in California, Texas, New York, Washington, Georgia, Massachusetts, Illinois, and Nevada.

In Asia, East West’s presence included full-service branches in Hong Kong, Shanghai, Shantou and Shenzhen, representative offices in Beijing, Chongqing, Guangzhou, Xiamen and Singapore, and administrative support offices in Beijing and Shanghai.

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Certain items on the Consolidated Financial Statements and notes for the prior years have been reclassified to conform to the 2024 presentation.

In accordance with the applicable accounting guidance for consolidation, the Company first determines if it has a variable interest in the entity.

A variable interest entity (“VIE”) is an entity that lacks equity investors or whose equity investors do not have a controlling financial interest in the entity through their equity investments.

Principles of Consolidation — The Consolidated Financial Statements in this Form 10-K include the accounts of East West and its subsidiaries that are majority owned and in which the Company has a controlling financial interest, and variable interest entities (“VIE”) in which the Company has determined to be the primary beneficiary.

All intercompany balances and transactions have been eliminated in consolidation.

The Company determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a VIE.

Voting interest entities are entities that have sufficient equity and provide the equity investors voting rights that enable them to make significant decisions relating to the entity’s operations.

VIEs are entities that, by design, either (1) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or (2) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity.

For a VIE, a controlling financial interest is where the Company has the power to direct the activities of an entity that most significantly impact the entity’s economic performance and has an obligation to absorb losses or the right to receive benefits from the VIE.

If it is determined that the Company does not have a variable interest in the entity, no further analysis is required and the entity is not consolidated.

The Company consolidates a VIE when the Company has a controlling financial interest in the entity and therefore is deemed to be the primary beneficiary.

The primary beneficiary of a VIE is determined if the Company has:

i) both the power and ability to direct activities of the VIE that most significantly affect the entity’s economic performance;

and ii) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE.

The Variable Interest Model applies to all legal entities, including corporations, partnerships, limited liability companies and trusts.

For an entity that does not meet the definition of a VIE, the entity is determined to be a voting interest entity.

The Company consolidates a voting interest entity if it can exert control over the financial and operating policies of an investee, which can occur if the Company has a more than 50% voting interest in the entity.

For unconsolidated voting interest entities or VIE, the Company uses the equity, cost or measurement alternative method based on the Company’s voting or economic interest.

Intercompany transactions and accounts have been eliminated in consolidation.

East West also has six wholly-owned subsidiaries that are statutory business trusts (the “Trusts”).

In accordance with Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 810, Consolidation, the Trusts are not included in the Consolidated Financial Statements.

Cash and Cash Equivalents — Cash and cash equivalents include cash on hand, cash items in transit, cash due from the Federal Reserve Bank of San Francisco (“FRBSF”) and other financial institutions, and federal funds sold with original maturities up to three months.

For unconsolidated voting interest entities or VIE, the Company uses the proportional amortization method (“PAM”), equity, cost or measurement alternative method based on the Company’s voting or economic interest.

East West has one wholly-owned subsidiary that is a statutory business trust (the “Trust”).

In accordance with the guidance in Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 810, Consolidation, the Trust has not been consolidated by the Company.

Cash and Cash Equivalents — Cash and cash equivalents include cash on hand, cash items in transit, cash due from the Federal Reserve Bank (“FRB”) of San Francisco and other financial institutions, and federal funds sold with original maturities up to three months.

Interest-Bearing Deposits with Banks — Interest-bearing deposits with banks include cash placed with other banks with original maturities greater than three months and less than one year.

Assets Purchased under Resale Agreements and Assets Sold under Repurchase Agreements — Resale agreements are recorded as receivables based on the values at which the securities or loans are acquired.

Assets Purchased under Resale Agreements and Securities Sold under Repurchase Agreements — Resale agreements are recorded as receivables based on the values at which the securities or loans are acquired.

Repurchase agreements are accounted for as collateralized financing transactions and recorded as liabilities based on the values at which the securities are sold.

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For allowance for credit losses on resale agreements, refer to the Allowance for Collateral-Dependent Financial Assets section of this note for details.

Securities — The Company’s securities include various debt securities, marketable and non-marketable equity securities.

Debt securities are recorded on the Consolidated Balance Sheet as of their trade dates.

Debt Securities — Debt securities are recorded on the Consolidated Balance Sheet as of their trade dates.

The Company initially classifies its debt securities as trading securities, AFS or HTM debt securities based on management’s intention on the date of the purchase.

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For details of the allowance for credit losses on debt securities, refer to the Allowance for Credit Losses on Available-for-Sale and Held-to-Maturity Debt Securities sections of this note.

Interest income, including any amortization of premium or accretion of discount, is included in net income.

Interest income, including any amortization of premium or accretion of discount, is included in debt securities of interest and dividend income in the Company’s Consolidated Statement of Income.

The Company recognizes realized gains and losses on the sale of AFS debt securities in earnings, using the specific identification method.

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The reversal and re-establishment of the allowance for credit losses are recorded in the provision for credit losses.

Equity Securities — The Company’s equity securities include both marketable and non-marketable equity securities.

Marketable equity securities with readily determinable fair values are recorded at fair value with unrealized gains and losses due to changes in fair value;

and are included in Other investment income on the Consolidated Statement of Income.

Marketable equity securities include mutual fund investments, which are included in Investments in qualified affordable housing partnership, tax credit and other investments, net on the Consolidated Balance Sheet.

Non-marketable equity securities including tax credit investments, and other equity investments that do not have readily determinable fair values are recorded in Investments in qualified affordable housing partnership, tax credit and other investments, net, and Other assets on the Consolidated Balance Sheet and are accounted for under one of the following accounting methods:

Marketable equity securities include mutual fund investments, which are included in Affordable housing partnership, tax credit and CRA investments, net on the Consolidated Balance Sheet.

Non-marketable equity securities including tax credit investments, and other equity investments that do not have readily determinable fair values are recorded in Affordable housing partnership, tax credit and CRA investments, net, and Other assets on the Consolidated Balance Sheet and are accounted for under one of the following accounting methods:

• Equity Method — When the Company has the ability to exercise significant influence over the investee.

• Cost Method — The cost method is applied to restricted equity securities held for membership and regulatory purposes, such as FRBSF and FHLB stock.

• Cost Method — The cost method is applied to restricted equity securities held for membership and regulatory purposes, such as FRB of San Francisco and FHLB stock.

These investments are held at their cost minus impairment.

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The Company’s impairment review for equity method, cost method and measurement alternative securities typically includes an analysis of the facts and circumstances of each security, the intent or requirement to sell the security, the expectations of cash flows, capital needs and the viability of its business model.

For equity method and cost method investments, the Company reduces the asset’s carrying value when the Company considers declines in value to be other-than-temporary impairment (“OTTI”).

For equity and cost method investments, the Company reduces the asset’s carrying value when the Company considers declines in value to be other-than-temporary impairment (“OTTI”).

For securities accounted for under the measurement alternative, the Company reduces the asset value when the fair value is less than the carrying value, without the consideration of recovery.

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A loan is returned to accrual status when the borrower has demonstrated a satisfactory payment trend subject to management’s assessment of the borrower’s ability to repay the loan.

Loan Modifications — Certain loans are modified in the normal course of business for competitive reasons or in conjunction with the Company’s loss mitigation activities.

Upon the adoption of ASU 2022-02 on January 1, 2023, the Company applies the general loan modification guidance provided in ASC 310-20 to all loan modifications, including modifications made to borrowers experiencing financial difficulty.

Under the general loan modification guidance, a modification is treated as a new loan only if the following two conditions are met:

Loan Modifications — The Company applies the general loan modification guidance provided in ASC 310-20 to all loan modifications, including modifications made to borrowers experiencing financial difficulty.

Under ASC 310-20-35-9 to 310-20-35-10, a modification is treated as a new loan only if the following two conditions are met:

(1) the terms of the new loan are at least as favorable to the Company as the terms for comparable loans to other customers with similar collection risks;

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The non-credit discount or premium will be accreted to interest income based on the effective interest rate on the PCD assets determined after the gross-up for the allowance for credit losses.

Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net — The Company records the investments in qualified affordable housing partnerships, net, primarily using the proportional amortization method.

Under the proportional amortization method, the Company amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received, and recognizes the amortization in Income tax expense on the Consolidated Statement of Income .

The Company records investments in tax credit and other investments, net, using either the equity method or the measurement alternative method of accounting.

The tax credits are recognized on the Consolidated Financial Statements to the extent they are utilized on the Company’s income tax returns in the year the credit arises under the flow-through method of accounting.

The investments are evaluated for possible OTTI on an annual basis or on an interim basis, if an event occurs that would trigger potential impairment.

OTTI charges and impairment recoveries are recorded within Amortization of tax credit and other investments on the Consolidated Statement of Income.

See Note 2 — Fair Value Measurement and Fair Value of Financial Instruments to the Consolidated Financial Statements in this Form 10-K for a discussion on the Company’s impairment evaluation and monitoring process of tax credit investments.

Premises and Equipment, Net — The Company’s premises and equipment are stated at cost less accumulated depreciation and amortization.

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Buildings 25 years

Furniture, fixtures and equipment, and building improvements 3 to 7 years

Furniture, fixtures and equipment

Leasehold improvements Term of lease or useful life, whichever is shorter

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(2) Commercial Banking;

and (3) Other.

and (3) Treasury and Other.

For information on how the reporting units are identified and the components are aggregated, see Note 17 — Business Segments to the Consolidated Financial Statements in this Form 10-K.

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If the qualitative analysis indicates that it is more likely than not that a reporting unit’s fair value is less than its carrying value, the Company is required to perform a quantitative assessment to determine if there is goodwill impairment.

Factors considered in the qualitative assessments include but are not limited to macroeconomic conditions, industry and market considerations, financial performance of the respective operating segment and other reporting unit specific considerations.

The Company uses a combined income and market approach in its quantitative valuation methodologies.

A quantitative valuation involves determining the fair value of each reporting unit and comparing the fair value to its corresponding carrying value.

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Derivatives — As part of its asset/liability management strategy, the Company uses derivative financial instruments to mitigate exposure to interest rate and foreign currency risks, and to assist customers with their risk management objectives.

Derivatives utilized by the Company include primarily swaps, forwards and option contracts.

Derivatives utilized by the Company primarily include swaps, forwards and option contracts.

Derivative instruments are included in Other assets or Accrued expenses and other liabilities on the Consolidated Balance Sheet at fair value.

The related cash flows are recognized on the Cash flows from operating activities section on the Consolidated Statement of Cash Flows.

The Company uses its accounting hedges based on the exposure being hedged as either fair value hedges, cash flow hedges or hedges of the net investments in certain foreign operations.

For fair value hedges of interest rate risk, changes in fair value of derivatives are reported within Interest expense on the Consolidated Statement of Income.

All derivatives designated as fair value hedges and hedges of the net investments in certain foreign operations are linked to specific hedged items or to groups of specific assets and liabilities on the Consolidated Balance Sheet.

Cash flow hedges are linked to the forecasted transactions related to a recognized asset/liability or to groups of recognized assets/liabilities.

The related cash flows impacts of derivatives are recognized on the Cash flows from operating activities section on the Consolidated Statement of Cash Flows.

The Company uses accounting hedges based on the exposure being hedged as either fair value hedges, cash flow hedges or hedges of the net investments in certain foreign operations.

For fair value hedges of interest rate risk, changes in fair value of derivatives are reported in the same line item where the earnings effect of the hedged item is presented, as Interest expense or Interest and dividend income on the Consolidated Statement of Income.

Changes in fair value of derivatives designated as hedges of the net investments in foreign operations are recorded as a component of AOCI.

For cash flow hedges of floating-rate interest payments or receipts, the change in the fair value of hedges is recognized in AOCI on the Consolidated Balance Sheet and reclassified to earnings in the same period when the hedged cash flows impact earnings.

Reclassified gains and losses of cash flow hedges are recorded in the same line item as the hedged interest payment within Interest expense or as interest receipts within Interest and dividend income on the Consolidated Statements of Income.

Cash flow hedges are linked to the forecasted transactions related to a recognized asset or liability.

To qualify as an accounting hedge under the hedge accounting rules (versus an economic hedge where hedge accounting is not sought), a derivative must be highly effective in offsetting the risk designated as being hedged.

The Company formally documents its hedging relationships at inception, including the identification of the hedging instruments and the hedged items, as well as its risk management objectives and strategies for undertaking the hedge transaction at the time the derivative contract is executed.

The changes in the fair value of the hedging instrument are recorded in the same income statement line item as the hedged item’s expense or income is recorded.

For example, fair value changes of hedged on borrowings are recorded within Interest expense , and fair value changes of hedges on loan assets are recorded as interest income within Interest and dividend income on the Consolidated Statements of Income.

The Company evaluates the hedge effectiveness and formally documents its hedging relationships at inception, including the identification of the hedging instruments and the hedged items, as well as its risk management objectives and strategies for undertaking the hedge transaction at the time the derivative contract is executed.

Subsequent to inception, on a quarterly basis, the Company assesses whether the derivatives used in hedging transactions are highly effective in offsetting changes in the fair value of the hedged items or the cash flows of attributable hedged risks.

The quarterly assessment is performed on both a prospective basis (to reconfirm forward-looking expectations that the hedge will be highly effective) and a retrospective basis (to determine whether the hedging relationship was highly effective).

The Company discontinues hedge accounting prospectively when (i) a derivative is no longer highly effective in offsetting changes in fair value;

The Company discontinues hedge accounting prospectively when (i) a derivative is no longer highly effective in offsetting the risk being hedged;

(ii) a derivative expires, or is sold, terminated or exercised, or (iii) the Company determines that designation of a derivative as a hedge is no longer appropriate.

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If a cash flow hedge is discontinued but the hedged forecasted cash flow is still expected to happen, the derivative net gain or loss will remain in AOCI and be reclassified into earnings in the periods in which the hedged forecasted cash flow affects earnings.

If a cash flow hedge is discontinued and when it becomes probable that the forecasted cash flow is not expected to happen, the derivative net gain or loss will be reclassified into earnings immediately.

If a cash flow hedge is discontinued and it becomes probable that the forecasted cash flow is not expected to happen, the derivative net gain or loss will be reclassified into earnings immediately.

The Company also offers various interest rate, commodity and foreign exchange derivative products to customers.

These transactions are not linked to specific assets or liabilities on the Consolidated Balance Sheet or to forecasted transactions in a hedging relationship and, therefore, do not qualify for hedge accounting.

These contracts are recorded at fair value with changes in fair value recorded in Customer derivative income or Foreign exchange income on the Consolidated Statement of Income.

As part of the Company’s loan origination process, from time to time, the Company obtains equity warrants to purchase preferred and/or common stock of public or private companies it provides loans to.

These derivative contracts are recorded at fair value with changes in fair value recorded in Customer derivative income or Foreign exchange income on the Consolidated Statement of Income.

From time to time, the Company obtains equity warrants to purchase preferred and/or common stock of public or private companies it provides loans to as part of the Company’s loan origination process.

Separately, the Company granted performance-based restricted stock units (“RSUs”) as part of its consideration for its investment in Rayliant Global Advisors Limited (“Rayliant”) during the third quarter of 2023.

The vesting of these performance-based RSUs is contingent on Rayliant meeting certain financial performance targets during the future performance period.

These equity contracts are accounted for as derivatives and recorded at fair value in Other assets or Accrued expenses and other liabilities on the Consolidated Balance Sheet with changes in fair value recorded in Lending fees or Customer derivative income on the Consolidated Statement of Income.

These equity contracts are accounted for as derivatives and recorded at fair value in Other assets or Accrued expenses and other liabilities on the Consolidated Balance Sheet with changes in fair value recorded in Lending fees , for equity warrants related to the loan origination process , or Other investment income, for performance-based RSU’s related to Rayliant, on the Consolidated Statement of Income.

The Company is exposed to counterparty credit risk, which is the risk that counterparties to the derivative contracts do not perform as expected.

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The Company uses master netting arrangements to mitigate counterparty credit risk in derivative transactions.

To the extent the derivatives are subject to master netting arrangements, the Company takes into account the impact of master netting arrangements that allow the Company to settle all derivative contracts executed with the same counterparty on a net basis, and to offset the net derivative position with the related cash and securities collateral.

To the extent the derivatives are subject to master netting arrangements, the Company takes into account the impact of master netting arrangements that allow the Company to set off all derivative contracts executed with the same counterparty on a net basis, and to offset the net derivative position with the related cash and securities collateral.

The Company elects to offset derivative transactions with the same counterparty on the Consolidated Balance Sheet when a derivative transaction has a legally enforceable master netting arrangement and when it is eligible for netting under ASC 210-20-45-1, Balance Sheet Offsetting:

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Derivative balances and related cash collateral are presented net on the Consolidated Balance Sheet.

In addition, the Company applies the Settlement to Market treatment for the cash collateralizing our interest rate and commodity contracts with certain centrally cleared counterparties.

As a result, derivative balances with these counterparties are considered settled by the collateral.

In addition, the Company applies the Settlement to Market treatment for the cash variation margin received/pledged on our interest rate and commodity contracts cleared through certain centrally cleared counterparties.

As a result, derivative balances with these counterparties are considered settled by the variation margin.

Fair Value — The Company records or discloses certain assets and liabilities at fair value.

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Stock-Based Compensation — The Company grants time-based RSUs, which include service conditions for vesting.

RSUs that vest in the form of shares of the Company’s common stock are classified as equity.

Compensation cost for these time-based awards is based on the quoted market price of the Company’s common stock at the grant date.

Compensation costs for time-based RSUs that will be settled in cash instead of shares are adjusted to fair value based on changes in the Company’s stock price up to the settlement date.

RSUs that will be settled in cash instead of shares are liability classified awards and compensation cost for these awards is adjusted to fair value based on changes in the Company’s stock price up to the settlement date.

In addition, the Company grants performance-based RSUs, which contain additional performance goals and market conditions that are required to be met in order for the awards to vest.

Compensation expense for these performance-based RSUs is based on the grant-date fair value considers both performance and market conditions.

Compensation expense for these performance-based RSUs is based on the grant-date fair value considering both performance and market conditions.

Subsequently, the Company evaluates the probable outcome of the performance conditions quarterly and makes cumulative adjustments for current and prior periods in compensation expense in the period of change.

Market conditions subsequent to the grant date have no impact on the amount of compensation expense the Company will recognize over the life of the award.

Market conditions subsequent to the grant date have no impact on the amount of compensation expense.

Compensation cost is amortized on a straight-line basis over the requisite service period for the entire award, which is generally the maximum vesting period of the award.

Excess tax benefits and deficiencies on share-based payment awards are recognized within Income tax expense on the Consolidated Statement of Income.

As stock-based compensation expense is estimated based on awards ultimately expected to vest, it is reduced by the expense related to awards expected to be forfeited.

Forfeitures are estimated at the time of grant and are updated quarterly.

As stock-based compensation expense is estimated based on awards ultimately expected to vest, it is reduced by the expense related to awards expected to be forfeited.

If the estimated forfeitures are revised, a cumulative effect of changes in estimated forfeitures for the current and prior periods is recognized in compensation expense in the period of change.

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Business analysis accounts that are assessed fees in excess of earnings credits received are typically charged at the end of each month, after all transactions are known and the credits are calculated.

Deposit service charge and related fee income are recognized in all operating segments.

Deposit service charges and related fee income are recognized in all operating segments and included in Deposit account fees on the Consolidated Statement of Income.

• Card Income — Card income consists of merchant referral fees and interchange income.

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Revenue is recognized when the net profit is determined by the payment networks at the end of each day.

Card income is recognized in consumer and business banking, and commercial banking segments.

Card income is recognized in consumer and business banking, and commercial banking segments and included in Deposit account fees on the Consolidated Statement of Income.

• Wealth Management Fees — The Company provides investment planning services for customers including wealth management services, asset allocation strategies, portfolio analysis and monitoring, investment strategies and risk management strategies.

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The Company establishes a liability for potential taxes, interest and penalties related to uncertain tax positions based on facts and circumstances, including the interpretation of existing law, new judicial or regulatory guidance, and the status of tax audits.

The Company uses the PAM for affordable housing partnership investments, whereby the associated tax credits are recognized as a reduction to tax expense.

Upon the adoption of ASU 2023-02 on January 1, 2024, the Company also began applying the PAM to new markets, historic, production and renewable energy tax credit investments.

Under PAM, the Company amortizes the initial cost of the investment in proportion to the income tax credits and other income tax benefits received, and recognizes the amortization in Income tax expense on the Consolidated Statement of Income.

The Company also holds investments in other tax credit investments using either equity method or the measurement alternative method of accounting.

These tax credits are recognized on the Consolidated Financial Statements to the extent they are utilized on the Company’s income tax returns in the year the credit arises under the flow through method of accounting.

Earnings Per Share — Basic EPS is computed by dividing net income by the weighted-average number of common shares outstanding during each period.

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dollar (“USD”) using period-end spot foreign exchange rates.

Revenues and expenses of East West Bank (China) Limited are translated, for the purpose of consolidation, from its functional currency into USD at the transaction date foreign exchange rates.

Revenues and expenses of East West Bank (China) Limited are translated, for the purpose of consolidation, from its functional currency into the reporting currency USD at the transaction date foreign exchange rates.

The effects of those translation adjustments are reported in the Foreign currency translation adjustments account within Other comprehensive income (loss) on the Consolidated Statement of Comprehensive Income, net of any related hedged effects.

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Standard Required Date of Adoption Description Effect on Financial Statements

ASU 2022-02, Financial Instruments — Credit Losses (Topic 326):

Troubled Debt Restructurings and the Vintage Disclosures

Effective for fiscal years beginning after December 15, 2022.

ASU 2022-02 eliminates the

• accounting guidance for TDR, and requires the Company to apply the loan refinancing and restructuring guidance to determine whether a modification made to a loan results in a new loan or a continuation of an existing loan;

• requirement to use a discounted cash flow method to measure receivables.

The guidance also requires

• enhanced disclosures for certain loan refinancing and restructurings by creditors when the borrower is experiencing financial difficulty;

• vintage disclosures of current period gross charge-offs (on a current year-to-date basis) by year of loan origination for financing receivables and net investments in leases within the scope of ASC 326-20:

Financial Instruments — Credit Losses — Measured at Amortized Cost .

The Company adopted ASU 2022-02 on January 1, 2023 on a prospective basis, except for the guidance related to the elimination of TDR recognition and measurement, which was adopted on a modified retrospective approach.

This adoption increased the allowance for loan losses on TDRs as of December 31, 2022 by $ 6 million and decreased opening retained earnings on January 1, 2023 by $ 4 million after-tax.

The following standards were adopted on January 1, 2023, but they did not have a material impact on the Company’s Consolidated Financial Statements:

• ASU 2021-08, Business Combinations (Topic 805) :

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers

• ASU 2022-01, Derivatives and Hedging (Topic 815) :

Fair Value Hedging — Portfolio Layer Method

• ASU 2022-04, Liabilities — Supplier Finance Program (Subtopic 405-50) :

Disclosures of Supplier Finance Program Obligations

Accounting Pronouncements Adopted in 2024

Standard Required Date of Adoption Description Effect on Financial Statements

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

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

January 1, 2024

ASU 2023-02 expands the scope of the proportional amortization method to equity tax credit investment programs if certain conditions are met.

Previously, the proportional amortization method could only be used for investments in low-income housing tax credit structures.

Under this guidance, companies are able to elect, on a tax credit program-by-tax credit program basis, to apply the proportional amortization method to all equity investments meeting the criteria in ASC 323-740-25-1.

January 1, 2024 ASU 2023-02 expands the scope of the PAM to equity tax credit investment programs if certain conditions are met.

Previously, the PAM could only be used for investments in low-income housing tax credit structures.

Under this guidance, companies are able to elect, on a tax credit program-by-tax credit program basis, to apply the PAM to all equity investments meeting the criteria in ASC 323-740-25-1.

The amendments in this guidance must be applied on a modified retrospective or a retrospective basis.

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The impact of the adoption decreased opening retained earnings on January 1, 2024 by $ 9 million.

The following standards were adopted on January 1, 2024, but they did not have a material impact on the Company’s Consolidated Financial Statements:

• ASU 2023-01, Leases (Topic 842):

Common Control Arrangements

• ASU 2022-03, Fair Value Measurement (Topic 820) Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions

Recent Accounting Pronouncements Yet to be Adopted

Accounting Pronouncements Adopted in 2024 (continued)

Standard Required Date of Adoption Description Effect on Financial Statements

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December 31, 2024

Early adoption is permitted

ASU 2023-07 expands the disclosure requirements for reportable segments of public entities by adding the following disclosure requirements:

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

The Company adopted ASU 2023-07 on December 31, 2024.

The amendments have been applied retrospectively to all prior periods presented.

The following standards were adopted on January 1, 2024, but they did not have a material impact on the Company’s Consolidated Financial Statements:

• ASU 2023-01, Leases (Topic 842):

Common Control Arrangements

• ASU 2022-03, Fair Value Measurement (Topic 820) Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions

Recent Accounting Pronouncements Yet to be Adopted

Standard Required Date of Adoption Description Effect on Financial Statements

2023-09, Income Taxes (Topic 740) :

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

The following standard will be adopted on January 1, 2025 and is not expected to have a material impact on the Company’s Consolidated Financial Statements:

2024-03, Income Statement —Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses

December 31, 2027

Early adoption is permitted.

ASU 2024-03 requires public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in the notes to financial statements.

Disclosures of disaggregated expenses include the following:

• The amounts of (a) purchases of inventory;

(b) employee compensation;

(d) intangible asset amortization;

and (e) depreciation, depletion and amortization of capitalized costs related to oil- and gas-producing activities in each relevant expense caption.

• A qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively.

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

The following standards were adopted on January 1, 2025, but they did not have a material impact on the Company’s Consolidated Financial Statements:

• ASU 2023-05, Business Combinations — Joint Venture Formations (Subtopic 805-60):

Recognition and Initial Measurement

• ASU 2024-02 , Codification Improvements — Amendments to Remove References to the Concepts Statements

Note 2 — Fair Value Measurement and Fair Value of Financial Instruments

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To perform this validation, the Company evaluates the fair values of securities by comparing the fair values provided by the third-party pricing service providers to prices from other available independent sources for the same securities.

When significant variances in prices are identified, the Company further compares inputs used by different sources to ascertain the reliability of these sources.

When significant variances in prices are identified, the Company further compares the inputs used by different sources to ascertain the reliability of these sources.

On a quarterly basis, the Company reviews the valuation inputs and methodology furnished by third-party pricing service providers for each security category.

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As these valuations are based on observable inputs in the current marketplace, they are classified as Level 2.

Equity Securities — Equity securities consisted of mutual funds as of both December 31, 2023 and 2022.

The Company invested in these mutual funds for Community Reinvestment Act (“CRA”) purposes.

Equity Securities — Equity securities consist of mutual funds and exchange-traded equity securities.

The Company invested in these mutual funds for CRA purposes.

The Company uses net asset value (“NAV”) information to determine the fair value of these equity securities.

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When NAV is available periodically, but the equity securities may not be readily marketable at its periodic NAV in the secondary market, the fair value of these equity securities is classified as Level 2.

Exchange-traded equity securities are measured based on quoted prices on an active exchange market, and classified as Level 1.

Effective January 24, 2024, all of the outstanding shares of Visa B common stock (“Visa B shares”) were redenominated to Visa Class B-1 common stock (“Visa B-1 shares”).

On April 8, 2024, Visa commenced an initial exchange offer for any and all outstanding Visa B-1 shares.

In exchange for the Company’s 2,266 Visa B-1 shares, the Company received 1,133 Visa Class B-2 common stock (“Visa B-2 shares”) and 449 Visa Class C common stock (“Visa C shares”).

The Visa B-2 shares remain subject to transfer restrictions and will continue to be held at cost.

As the Visa C shares are convertible into Visa’s publicly traded Class A common stock (“Visa A shares”), the Company recognized the Visa C shares at fair value of $ 568 thousand based on the closing price of the Visa A shares as of December 31, 2024.

Interest Rate Contracts — Interest rate contracts consist of interest rate swaps and options.

The fair value of the interest rate swaps is determined using the market standard methodology of netting the discounted future fixed cash payments (or receipts) and the discounted expected variable cash receipts (or payments).

The fair value of the interest rate options, which consist of floors and caps, is determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates fall below (rise above) the strike rate of the floors (caps).

The fair value of the interest rate options, which consist of floors and caps, is determined using the market standard methodology of discounting the future expected cash receipts that will occur if variable interest rates fall below (rise above) the strike rate of the floors (caps).

In addition, to comply with the provisions of ASC 820, Fair Value Measurement , the Company incorporates credit valuation adjustments to appropriately reflect both its own and the respective counterparty’s nonperformance risk in the fair value measurements of its derivatives.

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Considering the observable nature of all other significant inputs utilized, the Company classifies these derivative instruments as Level 2.

Foreign Exchange Contracts — The fair value of foreign exchange contracts is determined at each reporting period based on changes in the foreign exchange rates.

Foreign Exchange Contracts — The fair value of foreign exchange contracts is determined at each reporting period based on changes in the applicable foreign exchange rates.

These are over-the-counter contracts where quoted market prices are not readily available.

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Due to the observable nature of the inputs used in deriving the fair value of these contracts, the valuation of foreign exchange contracts is classified as Level 2.

As of both December 31, 2023 and 2022, the Bank held foreign currency non-deliverable forward contracts to hedge its net investment in its China subsidiary, East West Bank (China) Limited, a non-USD functional currency subsidiary.

In addition, the Bank managed its foreign currency exposure in the net investment in its China subsidiary, East West Bank (China) Limited, a non-USD functional currency subsidiary, with foreign currency non-deliverable forward contracts.

These foreign currency non-deliverable forward contracts were designated as net investment hedges.

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Due to the observable nature of the inputs used in deriving the estimated fair value, these instruments are classified as Level 2.

Credit Contracts — Credit contracts utilized by the Company are comprised of credit risk participation agreements (“RPAs”) entered into by the Company with institutional counterparties.

Credit Contracts — Credit contracts utilized by the Company are comprised of credit risk participation agreements (“RPAs”) between the Company and institutional counterparties.

The fair value of the RPAs is calculated by determining the total expected asset or liability exposure of the derivatives to the borrowers and applying the borrowers’ credit spread to that exposure.

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Due to the observable nature of all other significant inputs used in deriving the estimated fair value, credit contracts are classified as Level 2.

Equity Contracts — Equity contracts consist of warrants to purchase common or preferred stock of public and private companies, and any liability-classified contingent issuable shares of the Company.

Equity Contracts — Equity contracts consist of warrants to purchase common or preferred stock of public and/or private companies, and any liability-classified contingently issuable shares of the Company.

The fair value of the warrants is based on the Black-Scholes option pricing model.

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On a quarterly basis, the changes in the fair value of warrants from private companies are reviewed for reasonableness, and a measurement of uncertainty analysis on the equity volatility and liquidity discount assumptions is performed.

In connection with the Company’s acquisition of a 49.99 % equity interest in Rayliant during the third quarter of 2023, the Company granted performance-based RSUs as part of its consideration.

The vesting of these equity contracts is contingent on Rayliant meeting certain financial performance targets, and they are accounted for as a derivative liability.

The fair value of these liability-classified equity contracts varies based on the operating revenue and operating EBITDA of Rayliant to be achieved during the future performance period.

In connection with the Company’s acquisition of a 49.99 % equity interest in Rayliant during the third quarter of 2023, the Company granted 349,138 performance-based RSUs as part of its consideration, in addition to $ 95 million in cash.

The vesting of these equity contracts on September 1, 2028, is contingent on Rayliant meeting certain financial performance targets during the performance period.

The fair value of liability-classified equity contracts varies based on the operating revenue and operating EBITDA of Rayliant to be achieved during the future performance period, and these performance-based RSUs are expected to vest into a variable number of the Company’s common stock, ranging from 20 % to 200 % of the target performance-based RSUs granted.

Due to the unobservable nature of the input assumptions, these equity contracts are classified as Level 3.

For additional information on the equity contracts, refer to Note 5 — Derivatives and Note 7 — Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net and Variable Interest Entities to the Consolidated Financial Statements in this Form 10-K.

For additional information on the equity contracts, refer to Note 5 — Derivatives to the Consolidated Financial Statements in this Form 10-K.

Commodity Contracts — Commodity contracts consist of swaps and options referencing commodity products.

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as of December 31, 2024

($ in thousands) Level 1

Total Fair Value

($ in thousands) Level 1 Level 2 Level 3 Total Fair Value

AFS debt securities:

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government sponsored enterprise debt securities — 262,587 — 262,587

— 364,446 — 364,446

government agency and U.S.

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Total AFS debt securities $ 638,265 $ 10,208,546 $ — $ 10,846,811

Investments in qualified affordable housing partnerships, tax credit and other investments, net:

Affordable housing partnership, tax credit and CRA investments, net:

Equity securities $ 20,817 $ 4,204 $ — $ 25,021

Total investments in qualified affordable housing partnerships, tax credit and other investments, net

Total affordable housing partnership, tax credit and CRA investments, net $ 20,817 $ 4,204 $ — $ 25,021

Other assets:

Equity securities (2)

$ 568 $ — $ — $ 568

Total other assets $ 568 $ — $ — $ 568

Derivative assets:

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Net derivative liabilities $ — $ 418,482 $ 15,119 $ 433,601

Refer to footnotes on the following page.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

as of December 31, 2023

($ in thousands) Level 1

Total Fair Value

($ in thousands) Level 1 Level 2 Level 3 Total Fair Value

AFS debt securities:

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government sponsored enterprise debt securities — 364,446 — 364,446

— 461,607 — 461,607

government agency and U.S.

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Total AFS debt securities $ 1,060,375 $ 5,127,962 $ — $ 6,188,337

Investments in qualified affordable housing partnerships, tax credit and other investments, net:

Affordable housing partnership, tax credit and CRA investments, net:

Equity securities $ 20,509 $ 4,150 $ — $ 24,659

Total investments in qualified affordable housing partnerships, tax credit and other investments, net

$ 19,777 $ 4,177 $ — $ 23,954

Total affordable housing partnership, tax credit and CRA investments, net $ 20,509 $ 4,150 $ — $ 24,659

Derivative assets:

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Foreign exchange contracts — 57,072 — 57,072

Credit contracts — 1 — 1

Equity contracts — — 336 336

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Foreign exchange contracts — 42,564 — 42,564

Equity contract (4)

$ — $ — $ 15,119 $ 15,119

Credit contracts — 25 — 25

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Net derivative liabilities $ — $ 522,025 $ 15,119 $ 537,144

(1) Represents balance sheet netting of derivative assets and liabilities and related cash collateral under master netting agreements or similar agreements.

(1) Includes Government National Mortgage Association (“GNMA”) AFS debt securities totaling $ 7.2 billion and $ 1.2 billion of fair value as of December 31, 2024 and 2023, respectively.

(2) Consists of exchange-traded equity securities.

For additional information, see Assets and Liabilities Measured at Fair Value on a Recurring Basis — Equity Securities in Note 2 — Fair Value Measurement and Fair Value of Financial Instruments in this Form 10-K.

(3) Represents the balance sheet netting of derivative assets and liabilities and related cash collateral under master netting agreements or similar agreements.

See Note 5 — Derivatives to the Consolidated Financial Statements in this Form 10-K for additional information.

(4) Equity contracts classified as derivative liabilities consist of performance-based RSUs granted as part of EWBC’s consideration in its investment in Rayliant.

For the years ended December 31, 2023, 2022 and 2021, Level 3 fair value measurements that were measured on a recurring basis consisted of warrant equity contracts issued by private companies and liability-classified contingent issuable shares of the Company.

For the years ended December 31, 2024, 2023 and 2022, Level 3 fair value measurements that were measured on a recurring basis consisted of warrant equity contracts issued by private companies and liability-classified contingently issuable shares of the Company.

The following table provides a reconciliation of the beginning and ending balances of these equity contracts for the years ended December 31, 2024, 2023 and 2022:

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Total (losses) gains included in earnings (1)

( 97 ) ( 79 ) 17

Issuances — 92 91

Settlements — — ( 96 )

Transfers out of Level 3 (2)

Ending balance $ 239 $ 336 $ 323

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Ending balance $ 15,119 $ 15,119 $ —

(1) Includes both realized and unrealized (losses) gains recorded in Lending fees on the Consolidated Statement of Income.

The unrealized (losses) gains were $( 79 ) thousand, $ 17 thousand, and $( 44 ) thousand for the years ended December 31, 2023, 2022 and 2021, respectively.

(2) During the year ending December 31, 2021, the Company transferred $ 6 thousand of equity contracts measured on a recurring basis out of Level 3 to Level 2 after the corresponding issuer of the equity warrant, which was previously a private company, completed its initial public offering and became a public company.

(1) Includes unrealized (losses) gains recorded in Lending fees on the Consolidated Statement of Income.

(2) Equity contracts classified as derivative liabilities consist of performance-based RSUs granted as part of EWBC’s consideration in its investment in Rayliant.

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The Company considers unobservable inputs to be significant if, by their exclusion, the fair value of the Level 3 assets would be impacted by a predetermined percentage change.

($ in thousands) Fair Value Measurements (Level 3)

Valuation Technique

Unobservable Inputs

Range of Inputs

Weighted- Average of Inputs

($ in thousands) Fair Value Measurements (Level 3) Valuation Technique Unobservable Inputs Range of Inputs Weighted- Average of Inputs

December 31, 2024

Derivative assets:

Equity contracts $ 336 Black-Scholes option pricing model

Equity volatility 37 % — 48 %

Equity contracts $ 239 Black-Scholes option pricing model Equity volatility 38 % — 57 %

Liquidity discount 47 % 47 %

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Derivative assets:

Equity contracts $ 323 Black-Scholes option pricing model

Equity volatility 42 % — 60 %

Equity contracts $ 336 Black-Scholes option pricing model Equity volatility 37 % — 48 %

Liquidity discount 47 % 47 %

Derivative liabilities:

Equity contracts (2)

$ 15,119 Internal model Payout % designated based on operating revenue and operating EBITDA of investee 84 % 84 %

(1) Weighted-average of inputs is calculated based on the fair value of equity contracts as of December 31, 2024 and 2023.

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Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Assets measured at fair value on a nonrecurring basis include certain individually evaluated loans held-for-investment, investments in qualified affordable housing partnerships, tax credit and other investments, OREO, loans held-for-sale, and other nonperforming assets.

Nonrecurring fair value adjustments result from the impairment on certain individually evaluated loans held-for-investment and investments in qualified affordable housing partnerships, tax credit and other investments, from write-downs of OREO and other nonperforming assets, or from the application of lower of cost or fair value on loans held-for-sale.

Assets measured at fair value on a nonrecurring basis include certain individually evaluated loans held-for-investment, investments in affordable housing partnership, tax credit and CRA investments, OREO, loans held-for-sale, and other nonperforming assets.

Nonrecurring fair value adjustments result from the impairment on certain individually evaluated loans held-for-investment and investments in affordable housing partnership, tax credit and CRA investments, from the write-downs of OREO and other nonperforming assets, or from the application of lower of cost or fair value on loans held-for-sale.

Individually Evaluated Loans Held-for-Investment — Individually evaluated loans held-for-investment are classified as Level 3 assets.

The following two methods are used to derive the fair value of individually evaluated loans held-for-investment:

• Discounted cash flow valuation techniques that consist of developing an expected stream of cash flows over the life of the loans, and then calculating the present value of the loans by discounting the expected cash flows at a designated discount rate.

• Discounted cash flow valuation techniques consist of developing an expected stream of cash flows over the life of the loans, and then calculating the present value of the loans by discounting the expected cash flows at a designated discount rate.

• When the repayment of an individually evaluated loan is dependent on the sale of the collateral, the fair value of the loan is determined based on the fair value of the underlying collateral, which may take the form of real estate, inventory, equipment, contracts or guarantees.

1 unchanged sentence

An internal valuation utilizes one or more valuation techniques such as the income, market and/or cost approaches.

Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net — The Company conducts due diligence on its investments in qualified affordable housing partnerships, tax credit and other investments prior to the initial investment date and through the placed-in-service date.

After these investments are either acquired or placed into service, the Company continues its periodic monitoring process to ensure book values are realizable and that there is no significant tax credit recapture risk.

This monitoring process includes reviewing the investment entity’s quarterly financial statements and annual tax returns, the annual financial statements of the guarantor (if any) and a comparison of the actual performance of the investment against the financial projections prepared at the time the investment was made.

Loans Held-for-Sale — Loans held-for-investment subsequently transferred to held-for-sale are recorded at the lower of cost or fair value upon transfer.

Loans held-for-sale may be measured at fair value on a nonrecurring basis when fair value is less than cost.

Fair value is generally determined based on available market data for similar loans and therefore, loans held-for-sale are classified as Level 2.

Affordable Housing Partnership, Tax Credit and CRA Investments, Net — The Company conducts due diligence and secures applicable internal and external approval on its affordable housing partnership, tax credit and CRA investments prior to closing the investment and initial funding.

Subsequent to closing, the Company continues its periodic monitoring process to ensure that book values are realizable, investment is performing as expected and there is no significant tax credit recapture risk.

This monitoring process includes reviewing the investment entity’s financial statements, production reports and a nnual tax returns, the annual financial statements of the sponsor and guarantor (if any) and a comparison of the actual performance to plan based on the final financial model at the time of closing.

The Company assesses its tax credit and other investments for possible OTTI on an annual basis or when events or circumstances suggest that the carrying amount of the investments may not be realizable.

7 unchanged sentences

In accordance with ASC 323-10-35-32, Investments — Equity Method and Joint Ventures, an impairment charge would only be recognized in earnings for a decline in value that is determined to be other-than-temporary.

Other Real Estate Owned — The Company’s OREO represents properties acquired through foreclosure, or through full or partial satisfaction of loans held-for-investment.

Other Real Estate Owned — The Company’s OREO represents properties acquired through foreclosure, or through full or partial satisfaction of loans held-for-investment such as an acceptance of a deed-in-lieu of foreclosure.

These OREO properties are recorded at estimated fair value less the costs to sell at the time of foreclosure or at the lower of cost or estimated fair value less the costs to sell subsequent to acquisition.

1 unchanged sentence

OREO properties are classified as Level 3.

Loans Held-for-Sale — Loans held-for-investment subsequently transferred to held-for-sale are recorded at the lower of cost or fair value upon transfer.

Loans held-for-sale may be measured at fair value on a nonrecurring basis when fair value is less than cost.

Fair value is generally determined based on available market data for similar loans and therefore, loans held-for-sale are classified as Level 2.

Other Nonperforming Assets — Other nonperforming assets are recorded at fair value upon transfer from loans to foreclosed assets.

6 unchanged sentences

as of December 31, 2024

($ in thousands) Level 1

Fair Value Measurements

($ in thousands) Level 1 Level 2 Level 3 Fair Value Measurements

Loans held-for-investment:

1 unchanged sentence

CRE — — 1,678 1,678

Construction and land — — 11,316 11,316

Total commercial — — 61,378 61,378

Residential mortgage:

HELOCs — — 1,204 1,204

Single-family residential

Total consumer — — 108 108

Total loans held-for-investment $ — $ — $ 61,486 $ 61,486

Investments in qualified affordable housing partnerships, tax credit and other investments, net

Affordable housing partnership, tax credit and CRA investments, net $ — $ — $ 5,000 $ 5,000

$ — $ — $ 19,386 $ 19,386

(1) Represents the carrying value of OREO property that was written down subsequent to its initial classification as OREO and is included in Other assets on the Consolidated Balance Sheet.

Assets Measured at Fair Value on a Nonrecurring Basis

as of December 31, 2023

($ in thousands) Level 1

Fair Value Measurements

($ in thousands) Level 1 Level 2 Level 3 Fair Value Measurements

Loans held-for-investment:

6 unchanged sentences

Total loans held-for-investment $ — $ — $ 45,892 $ 45,892

The following table presents the increase (decrease) in the fair value of certain assets held at the end of the respective reporting periods, for which a nonrecurring fair value adjustment was recognized for the years ended December 31, 2023, 2022 and 2021:

Affordable housing partnership, tax credit and CRA investments, net $ — $ — $ 868 $ 868

The following table presents the change in the fair value of certain assets held at the end of the respective reporting periods, for which a nonrecurring fair value adjustment was recognized for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,

3 unchanged sentences

CRE ( 78 ) ( 1,183 ) ( 7,098 )

Construction and land ( 2,289 ) — —

Total CRE ( 2,367 ) ( 1,183 ) ( 7,098 )

Total commercial ( 46,121 ) ( 7,335 ) ( 33,094 )

Residential mortgage:

Single-family residential ( 1,392 ) — —

HELOCs — ( 40 ) 166

Total residential mortgage ( 1,392 ) ( 40 ) 166

Total consumer ( 1,392 ) ( 40 ) 166

Total loans held-for-investment $ ( 47,513 ) $ ( 7,375 ) $ ( 32,928 )

Investments in qualified affordable housing partnerships, tax credit and other investments, net

$ ( 1,140 ) $ 469 $ 877

Affordable housing partnership, tax credit and CRA investments, net $ ( 685 ) $ ( 1,140 ) $ 469

OREO $ ( 7,735 ) $ — $ —

Other nonperforming assets $ — $ — $ ( 6,861 )

The following table presents the quantitative information about the significant unobservable inputs used in the valuation of Level 3 fair value measurements that are measured on a nonrecurring basis as of December 31, 2024 and 2023:

($ in thousands) Fair Value Measurements (Level 3)

Valuation Techniques

Unobservable Inputs

Range of Inputs

Weighted-Average of Inputs

($ in thousands) Fair Value Measurements (Level 3) Valuation Techniques Unobservable Inputs Range of Inputs Weighted-Average of Inputs

December 31, 2024

Loans held-for-investment

$ 16,328 Fair value of collateral Discount 15 % — 75 %

Loans held-for-investment $ 910 Fair value of collateral Discount 50 %

$ 22,993 Fair value of collateral Contract value NM NM

$ 37,583 Fair value of property Selling cost 8 % — 20 %

Investments in qualified affordable housing partnerships, tax credit and other investments, net

$ 868 Individual analysis of each investment Expected future tax

Affordable housing partnership, tax credit and CRA investments, net $ 5,000 Individual analysis of each investment Expected future tax

benefits and distributions NM NM

OREO $ 19,386 Fair value of property Selling cost 8 % 8 %

December 31, 2023

Loans held-for-investment $ 23,322 Discounted cash flows Discount 4 % — 6 %

$ 17,912 Fair value of collateral Discount 15 % — 75 %

Loans held-for-investment $ 16,328 Fair value of collateral Discount 15 % — 75 %

$ 3,009 Fair value of collateral Contract value NM NM

$ 26,555 Fair value of property Selling cost 8 %

Affordable housing partnership, tax credit and CRA investments, net $ 868 Individual analysis of each investment Expected future tax

benefits and distributions NM NM

NM - Not meaningful

(1) Weighted-average of inputs is based on the relative fair value of the respective assets as of December 31, 2023 and 2022.

(1) Weighted-average of inputs is based on the relative fair value of the respective assets as of both December 31, 2024 and 2023.

Disclosures about the Fair Value of Financial Instruments

3 unchanged sentences

December 31, 2024

($ in thousands)

Carrying Amount

Level 1 Level 2 Level 3 Estimated Fair Value

($ in thousands) Carrying Amount Level 1 Level 2 Level 3 Estimated Fair Value

Financial assets:

4 unchanged sentences

Restricted equity securities, at cost $ 165,259 $ — $ 165,259 $ — $ 165,259

Loans held-for-sale $ 116 $ — $ 116 $ — $ 116

Loans held-for-investment, net $ 53,024,585 $ — $ — $ 51,328,254 $ 51,328,254

3 unchanged sentences

Demand, checking, savings and money market deposits $ 39,959,251 $ — $ 39,959,251 $ — $ 39,959,251

$ 38,048,974 $ — $ 38,048,974 $ — $ 38,048,974

Time deposits $ 23,215,772 $ — $ 23,225,317 $ — $ 23,225,317

Short-term borrowings $ 4,500,000 $ — $ 4,500,000 $ — $ 4,500,000

FHLB advances $ 3,500,000 $ — $ 3,497,953 $ — $ 3,497,953

Long-term debt $ 32,001 $ — $ 31,246 $ — $ 31,246

1 unchanged sentence

December 31, 2023

($ in thousands) Carrying Amount

Level 1 Level 2 Level 3 Estimated Fair Value

($ in thousands) Carrying Amount Level 1 Level 2 Level 3 Estimated Fair Value

Financial assets:

10 unchanged sentences

Demand, checking, savings and money market deposits $ 38,048,974 $ — $ 38,048,974 $ — $ 38,048,974

$ 42,637,316 $ — $ 42,637,316 $ — $ 42,637,316

Time deposits $ 18,043,464 $ — $ 18,004,951 $ — $ 18,004,951

Repurchase agreements $ 300,000 $ — $ 304,097 $ — $ 304,097

BTFP borrowings

$ 4,500,000 $ — $ 4,500,000 $ — $ 4,500,000

Long-term debt $ 148,249 $ — $ 150,896 $ — $ 150,896

Accrued interest payable $ 205,430 $ — $ 205,430 $ — $ 205,430

Note 3 — Assets Purchased under Resale Agreements and Sold under Repurchase Agreements

Assets Purchased under Resale Agreements

The Company’s resale agreements exposes it to credit risk for both the counterparties and the underlying collateral.

Note 3 — Securities Purchased under Resale Agreements

The Company’s resale agreements expose it to credit risk from both the counterparties and the underlying collateral.

The Company manages credit exposure from certain transactions by entering into master netting agreements and collateral arrangements with the counterparties.

The relevant agreements allow for an efficient closeout of the transaction, liquidation and set-off of collateral against the net amount owed by the counterparty following a default.

It is also the Company’s policy to take possession, where possible, of the assets underlying resale agreements.

It is the Company’s policy to take possession, where possible, of the assets underlying resale agreements.

As a result of the Company’s credit risk mitigation practices with respect to resale agreements as described above, the Company did not hold any reserves for credit impairment with respect to these agreements as of both December 31, 2024 and 2023.

Securities Purchased under Resale Agreements — Total securities purchased under resale agreements were $ 785 million and $ 760 million as of December 31, 2023 and 2022, respectively.

The weighted-average yields were 2.87 %, 2.12 % and 1.53 % for the years ended December 31, 2023, 2022 and 2021, respectively.

Loans Purchased under Resale Agreements — Loans purchased under resale agreements were $ 32 million a s of December 31, 2022.

The Company had no loans purchased under resale agreements as of December 31, 2023 due to the maturity of the underlying loans.

Total securities purchased under resale agreements were $ 425 million and $ 785 million as of December 31, 2024 and 2023, respectively.

The weighted-average yields were 2.17 %, 2.87 % and 2.12 % for the years ended December 31, 2024, 2023 and 2022, respectively.

Assets Sold under Repurchase Agreements — Gross repurchase agreements were $ 300 million as of December 31, 2022.

The Company extinguished $ 300 million of repurchase agreements during the first quarter of 2023 and recorded $ 4 million of extinguishment charges during 2023.

In comparison, no extinguishment charges were recorded for the years ended December 31, 2022 and 2021.

The weighted-average interest rates were 3.07 % and 2.61 % for the years ended December 31, 2022 and 2021, respectively These weighted-average interest rates also reflect the impact of short-term repurchase agreements entered and repaid during the years presented.

Balance Sheet Offsetting

4 unchanged sentences

Collateral pledged consists of securities that are not netted on the Consolidated Balance Sheet against the related collateralized liability.

Securities received or pledged as collateral in resale and repurchase agreements with other financial institutions may also be sold or re-pledged by the secured party, and are usually delivered to and held by the third-party trustees.

The following tables present the resale and repurchase agreements included on the Consolidated Balance Sheet as of December 31, 2023 and 2022:

($ in thousands) December 31, 2023

Gross Amounts of Recognized Assets

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts of Assets Presented on the Consolidated Balance Sheet

Gross Amounts Not Offset on the Consolidated Balance Sheet

Assets Collateral Received Net Amount

Resale agreements $ 785,000 $ — $ 785,000 $ ( 715,358 ) (1)

Gross Amounts of Recognized Liabilities

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts of Liabilities Presented on the Consolidated Balance Sheet

Gross Amounts Not Offset on the Consolidated Balance Sheet

Liabilities Collateral Pledged Net Amount

Repurchase agreements $ — $ — $ — $ — $ —

($ in thousands) December 31, 2022

Gross Amounts of Recognized Assets

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts of Assets Presented on the Consolidated Balance Sheet

Gross Amounts Not Offset on the Consolidated Balance Sheet

Assets Collateral Received Net Amount

Resale agreements $ 792,192 $ — $ 792,192 $ ( 701,790 ) (1)

Gross Amounts of Recognized Liabilities

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts of Liabilities Presented on the Consolidated Balance Sheet

The following table presents the resale agreements included on the Consolidated Balance Sheet as of December 31, 2024 and 2023:

Gross Amounts Not Offset on the Consolidated Balance Sheet

Liabilities Collateral Pledged Net Amount

Repurchase agreements $ 300,000 $ — $ 300,000 $ ( 300,000 ) (2)

($ in thousands) Gross Amounts of Recognized Assets Gross Amounts Offset on the Consolidated Balance Sheet Net Amounts of Assets Presented on the Consolidated Balance Sheet Collateral Received (1)

Resale agreements as of December 31, 2024

$ 425,000 $ — $ 425,000 $ ( 329,603 ) $ 95,397

Resale agreements as of December 31, 2023

$ 785,000 $ — $ 785,000 $ ( 715,358 ) $ 69,642

(1) Represents the fair value of assets the Company has received under resale agreements, limited for table presentation purposes to the amount of the recognized asset due from each counterparty.

1 unchanged sentence

Therefore, excess collateral, if any, is not reflected above.

(2) Represents the fair value of assets the Company has pledged under repurchase agreements, limited for table presentation purposes to the amount of the recognized liability due to each counterparty.

The application of collateral cannot reduce the net position below zero.

Therefore, excess collateral, if any, is not reflected above.

In addition to the amounts included in the tables above, the Company also has balance sheet netting related to derivatives.

In addition to the amounts included in the table above, the Company also has balance sheet netting related to derivatives.

Refer to Note 5 — Derivatives to the Consolidated Financial Statements in this Form 10-K for additional information.

3 unchanged sentences

($ in thousands) Amortized Cost (1)

Gross Unrealized Gains

Gross Unrealized Losses

Gross Unrealized Gains Gross Unrealized Losses Fair Value

AFS debt securities:

28 unchanged sentences

December 31, 2023

($ in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value

($ in thousands) Amortized Cost (1)

Gross Unrealized Gains Gross Unrealized Losses Fair Value

AFS debt securities:

10 unchanged sentences

Residential mortgage-backed securities 643,335 —

( 89,664 ) 553,671

Corporate debt securities 653,501 — ( 151,076 ) 502,425

14 unchanged sentences

Total debt securities 9,872,531 783 ( 1,231,006 ) 8,642,308

As of December 31, 2023 and 2022, the amortized cost of debt securities excluded accrued interest receivables of $ 44 million and $ 42 million, respectively, which are included in Other assets on the Consolidated Balance Sheet.

(1) Amortized cost excludes accrued interest receivables, which are included in Other assets on the Consolidated Balance Sheet.

As of December 31, 2024 and 2023, the accrued interest receivables were $ 45 million and $ 44 million, respectively.

For the Company’s accounting policy related to debt securities’ accrued interest receivable, see Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Allowance for Credit Losses on Available-for-Sale Debt Securities and Allowance for Credit Losses on Held-to-Maturity Debt Securities to the Consolidated Financial Statements in this Form 10-K.

(2) Includes GNMA AFS debt securities totaling $ 7.3 billion of amortized cost and $ 7.2 billion of fair value as of December 31, 2024, and $ 1.3 billion of amortized cost and $ 1.2 billion of fair value as of December 31, 2023.

(3) Includes GNMA HTM debt securities totaling $ 86 million of amortized cost and $ 68 million of fair value as of December 31, 2024, and $ 92 million of amortized cost and $ 75 million of fair value as of December 31, 2023.

Unrealized Losses of Available-for-Sale Debt Securities

2 unchanged sentences

Less Than 12 Months 12 Months or More Total

($ in thousands) Fair Value

Gross Unrealized Losses

($ in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses

AFS debt securities:

17 unchanged sentences

Less Than 12 Months 12 Months or More Total

($ in thousands) Fair Value

Gross Unrealized Losses

($ in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses

AFS debt securities:

20 unchanged sentences

government agency and U.S.

government-sponsored enterprise mortgage-backed securities, 100 non-agency mortgage-backed securities, and 68 corporate debt securities.

government-sponsored enterprise mortgage-backed securities, 66 corporate debt securities, and 99 non-agency mortgage-backed securities.

Allowance for Credit Losses on Available-for-Sale Debt Securities

10 unchanged sentences

A portion of the corporate debt securities is comprised of subordinated debt securities issued by U.S.

Despite the reduction of the market value of these securities after the banking sector disruption in 2023, these securities are nearly all rated investment grade by NRSROs or issued by well-capitalized financial institutions with strong profitability.

Despite the reduction of the market value of these securities after the banking sector disruption in 2023, these securities are nearly all rated investment grade by NRSROs and issued by well-capitalized financial institutions with strong profitability.

The contractual payments from these corporate debt securities have been and are expected to be received on time.

16 unchanged sentences

Realized Gains and Losses

The following table presents the gross realized gains from the sales and impairment write-off of AFS debt securities and the related tax (benefit) expense included in earnings for the years ended December 31, 2023, 2022 and 2021:

The following table presents the gross realized gains from the sales and impairment write-off of AFS debt securities and the related tax expense (benefit) included in earnings for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,

4 unchanged sentences

$ — $ ( 10,000 ) $ —

Related tax (benefit) expense

Related tax expense (benefit)

$ 612 $ ( 2,029 ) $ 386

96 unchanged sentences

(2) Yields on tax-exempt securities are not presented on a tax-equivalent basis.

As of December 31, 2023 and 2022, AFS and HTM debt securities with carrying values of $ 7.0 billion and $ 794 million, respectively, were pledged to secure borrowings, public deposits, repurchase agreements and for other purposes required or permitted by law.

As of December 31, 2024 and 2023, AFS and HTM debt securities with carrying values of $ 5.4 billion and $ 7.0 billion, respectively, were pledged to secure borrowings, public deposits, repurchase agreements and for other purposes required or permitted by law.

Restricted Equity Securities

1 unchanged sentence

($ in thousands) 2024 2023

FRB of San Francisco stock

$ 63,930 $ 62,561

11 unchanged sentences

The fair values are presented on a gross basis prior to the application of bilateral collateral and master netting agreements, but after the application of variation margin payments as settlement to fair values of contracts cleared through central clearing organizations.

Applying variation margin payments as settlement to the fair values of derivative contracts cleared through the London Clearing House (“LCH”) and the Chicago Mercantile Exchange (“CME”) resulted in reductions in both the derivative asset and liability fair values of $ 43 million as of December 31, 2023.

In comparison, applying variation margin payments as settlement to LCH- and CME-cleared derivative transactions resulted in reductions in the derivative asset and liability fair values of $ 167 million and $ 81 million, respectively, as of December 31, 2022.

Applying variation margin payments as settlement to the fair values of derivative contracts cleared through the London Clearing House (“LCH”) and the Chicago Mercantile Exchange (“CME”) resulted in reductions in the derivative asset and liability fair values of $ 17 million and $ 15 million, respectively, as of December 31, 2024.

In comparison, applying variation margin payments as settlement to LCH- and CME-cleared derivative transactions resulted in reductions in both the derivative asset and liability fair values of $ 43 million as of December 31, 2023.

Total derivative asset and liability fair values are adjusted to reflect the effects of legally enforceable master netting agreements and cash collateral received or paid.

2 unchanged sentences

Fair Value Fair Value

($ in thousands) Notional Amount Assets

Notional Amount Assets

($ in thousands) Notional Amount Assets Liabilities Notional Amount Assets Liabilities

Derivatives designated as hedging instruments:

1 unchanged sentence

Interest rate contracts $ 5,250,000 $ 5,647 $ 35,211 $ 5,250,000 $ 50,421 $ 13,124

$ 5,250,000 $ 50,421 $ 13,124 $ 3,450,000 $ 13,455 $ 19,687

Net investment hedges:

Foreign exchange contracts — — — 81,480 3,394 —

81,480 3,394 — 84,832 5,590 —

Total derivatives designated as hedging instruments $ 5,250,000 $ 5,647 $ 35,211 $ 5,331,480 $ 53,815 $ 13,124

$ 5,331,480 $ 53,815 $ 13,124 $ 3,534,832 $ 19,045 $ 19,687

Derivatives not designated as hedging instruments:

Interest rate contracts $ 17,005,381 $ 379,664 $ 378,961 $ 17,387,909 $ 423,486 $ 420,812

$ 17,387,909 $ 423,486 $ 420,812 $ 16,932,414 $ 426,828 $ 564,829

Commodity contracts (1)

5 unchanged sentences

Total derivatives not designated as hedging instruments $ 22,375,840 $ 517,486 $ 510,674 $ 23,333,449 $ 557,105 $ 600,190

$ 23,333,449 $ 557,105 $ 600,190 $ 20,056,255 $ 736,283 $ 867,577

Gross derivative assets/liabilities $ 523,133 $ 545,885 $ 610,920 $ 613,314

4 unchanged sentences

In comparison, the notional amount of the Company’s commodity contracts totaled 18,631 thousand barrels of crude oil and 328,844 thousand MMBTUs of natural gas as of December 31, 2023.

(2) Notional amount for credit contracts reflects the Company’s pro-rata share of the derivative instruments in RPAs.

(3) The Company held equity contracts in 11 private companies and one public company as of December 31, 2023, and 13 private companies and one public company as of December 31, 2022.

(2) The notional amount for credit contracts reflects the Company’s pro-rata share of the notional amount in the derivative instruments in RPAs.

(3) The Company held equity contracts in eight private companies and no public company as of December 31, 2024, and 11 private companies and one public company as of December 31, 2023.

(4) Equity contracts classified as derivative liabilities consist of 349,138 performance-based RSUs granted as part of EWBC’s consideration in its investment in Rayliant.

Derivatives Designated as Hedging Instruments

Cash Flow Hedges — The Company uses interest rate swaps to hedge the variability in interest amount received on certain floating-rate commercial loans, or paid on certain floating-rate borrowings due to changes in contractually specified interest rates.

Cash Flow Hedges — The Company uses interest rate swaps to hedge the variability in the interest amount received on certain floating-rate commercial loans, or paid on certain floating-rate borrowings due to changes in contractually specified interest rates.

As of December 31, 2024, interest rate contracts with total notional amount of $ 5.3 billion were designated as cash flow hedges to convert certain variable-rate loans from floating-rate payments to fixed-rate payments.

2 unchanged sentences

The following table presents the pre-tax changes in AOCI from cash flow hedges for the years ended December 31, 2024, 2023 and 2022.

The after-tax impact of cash flow hedges on AOCI is shown in Note 15 — Accumulated Other Comprehensive Income (Loss) to the Consolidated Financial Statements in this Form 10-K.

The after-tax impact of cash flow hedges on AOCI is shown in Note 15 — Accumulated Other Comprehensive (Loss) Income to the Consolidated Financial Statements in this Form 10-K.

Year Ended December 31,

($ in thousands) 2024 2023 2022

(Losses) gains recognized in AOCI:

Losses recognized in AOCI:

Interest rate contracts

4 unchanged sentences

Noninterest income — 1,614 (1) —

1,614 (1) — —

Total $ ( 91,083 ) $ ( 79,843 ) $ ( 4,004 )

(1) Represents the amounts in AOCI reclassified into earnings as a result that the forecasted cash flows were no longer probable to occur.

(1) Represents the amounts in AOCI reclassified into earnings resulting from forecasted cash flows that were no longer probable to occur.

Net Investment Hedges — The Company enters into foreign currency forward contracts to hedge a portion of the Bank’s investment in East West Bank (China) Limited, a non-USD functional currency subsidiary in China.

3 unchanged sentences

($ in thousands) 2024 2023 2022

Gains (losses) recognized in AOCI $ 2,571 $ 4,509 $ ( 4,558 )

Gains recognized in AOCI

$ 586 $ 2,571 $ 4,509

Derivatives Not Designated as Hedging Instruments

15 unchanged sentences

Swaps 1,504,469 16,117 25,366 1,588,491 5,801 18,118

Other 136,000 1,839 — 121,631 2,070 245

Purchased options

— — — 136,000 1,839 —

Subtotal 2,500,955 27,810 49,567 2,681,109 17,106 24,874

Total $ 10,994,794 $ 39,718 $ 416,216 $ 11,362,194 $ 43,195 $ 419,499

Other economic hedges:

Economic hedges:

Interest rate contracts:

1 unchanged sentence

Purchased options 1,458,428 4,990 — 1,522,531 12,783 —

Written options — — — 32,117 — 1,235

Collars and corridors

181,039 443 84 322,732 4,491 456

Subtotal 8,511,542 367,756 12,312 8,706,824 397,397 26,187

2 unchanged sentences

Swaps 2,613,755 58,955 19,949 2,862,037 36,280 15,757

Other 136,000 — 1,839 121,631 245 2,070

Written options

— — — 136,000 — 1,839

Subtotal 2,700,505 61,273 21,687 3,146,040 36,572 17,690

2 unchanged sentences

Offsetting contracts entered with third-party financial institutions are used as economic hedges to manage the Company’s exposure on its customer-related positions.

The following table presents the notional amounts in units and the gross fair values of the commodity derivatives issued for customer-related positions and other economic hedges as of December 31, 2023 and 2022:

The following table presents the notional amounts in units and the gross fair values of the commodity derivatives issued for its customers and entered for economic hedges as of December 31, 2024 and 2023:

December 31, 2024 December 31, 2023

Fair Value Fair Value

($ in thousands) Notional Units Assets Liabilities Notional Units Assets Liabilities

(Amounts in thousands)

Notional Units Assets Liabilities Notional Units Assets Liabilities

Customer-related positions:

2 unchanged sentences

Collars 5,477 Barrels 1,604 3,362 5,966 Barrels 1,820 5,103

Written options — Barrels — — — Barrels 558 —

Subtotal 10,307 Barrels 6,286 10,236 9,243 Barrels 5,555 20,548

4 unchanged sentences

Total $ 25,609 $ 32,500 $ 6,014 $ 114,974

Other economic hedges:

Economic hedges:

Commodity contracts:

1 unchanged sentence

Collars 5,477 Barrels 1,547 76 5,966 Barrels 1,685 1,467

Purchased options — Barrels — — — Barrels — 516

Subtotal 10,307 Barrels 6,026 3,969 9,388 Barrels 10,851 6,391

8 unchanged sentences

The Company may enter into protection sold or protection purchased RPAs.

Credit risk on RPAs is managed by monitoring the credit worthiness of the borrowers and the institutional counterparties, which is a part of the Company’s normal credit review and monitoring process.

All reference entities of the protection sold RPAs were investment grade, and the weighted-average remaining maturity was 2.8 years and 2.4 years as of December 31, 2023 and 2022, respectively.

Assuming the underlying borrowers referenced in the interest rate contracts defaulted as of December 31, 2023, the maximum exposure of protection sold RPAs would be $ 177 thousand.

In comparison, assuming the underlying borrowers referenced in the interest rate contracts defaulted as of December 31, 2022, the Company would not have any current exposure in the protection sold RPAs.

As of December 31, 2023, the Company had one outstanding protection purchased RPA with a notional amount of $ 25 million and minimal fair value.

In comparison, the Company did not have any outstanding protection purchased RPAs as of December 31, 2022.

Credit risk on RPAs is managed by monitoring the credit worthiness of the borrowers and the institutional counterparties, and is a part of the Company’s normal credit review and monitoring process.

Assuming the underlying borrowers referenced in the interest rate contracts defaulted, the maximum exposure of protection sold RPAs would be $ 170 thousand and $ 177 thousand as of December 31, 2024 and 2023, respectively.

The following table presents the notional amounts and the gross fair values of RPAs sold and purchased outstanding as of December 31, 2024 and 2023:

($ in thousands) December 31, 2024 December 31, 2023

Notional Amount

Fair Value Notional Amount

Assets Liabilities Assets Liabilities

RPAs — protection sold (1)

$ 133,174 $ — $ 12 $ 93,393 $ — $ 25

RPAs — protection purchased

35,825 1 — 24,998 1 —

Total RPAs $ 168,999 $ 1 $ 12 $ 118,391 $ 1 $ 25

(1) All reference entities of the protection sold RPAs were investment grade.

The weighted-average remaining maturities were 1.6 years and 2.8 years as of December 31, 2024 and 2023, respectively.

Equity Contracts — As part of the loan origination process, the Company may obtain warrants to purchase the preferred and/or common stock of the borrowers’ companies, which are mainly in the technology and life sciences sectors.

2 unchanged sentences

The vesting of these equity contracts is contingent on Rayliant meeting certain financial performance targets during the future performance period.

For additional information on these equity contracts, refer to Note 2 — Fair Value Measurement and Fair Value of Financial Instruments and Note 7 — Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net and Variable Interest Entities to the Consolidated Financial Statements in this Form 10-K.

The following table presents the net gains (losses) recognized on the Company’s Consolidated Statement of Income related to derivatives not designated as hedging instruments for the years ended December 31, 2023, 2022 and 2021:

Classification on Consolidated Statement of Income

For additional information on these equity contracts, refer to Note 2 — Fair Value Measurement and Fair Value of Financial Instruments and Note 7 — Affordable Housing Partnership, Tax Credit and Community Reinvestment Act Investments, Net to the Consolidated Financial Statements in this Form 10-K.

The following table presents the net gains (losses) due to fair value changes that are recognized on the Company’s Consolidated Statement of Income related to derivatives not designated as hedging instruments for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,

($ in thousands) 2023 2022 2021

($ in thousands) Classification on Consolidated Statement of Income 2024 2023 2022

Derivatives not designated as hedging instruments:

Interest rate contracts Customer derivative income $ 549 $ ( 2,989 ) $ 13,905

$ ( 2,989 ) $ 13,905 $ 11,493

Foreign exchange contracts Foreign exchange income 54,073 52,817 13,799

Credit contracts Customer derivative income — ( 1 ) 118

( 1 ) 118 139

Equity contracts - warrants

Lending fees 13 151 382

Equity contracts - warrants Lending fees ( 97 ) 13 151

Commodity contracts Customer derivative income 929 ( 25 ) 48

( 25 ) 48 ( 58 )

Net gains $ 55,454 $ 49,815 $ 28,021

1 unchanged sentence

Such an event primarily relates to a downgrade in the credit rating of East West Bank to below investment grade.

As of December 31, 2023, the aggregate fair value amounts of all derivative instruments with credit risk-related contingent features that were in a net liability position totaled $ 9 thousand, for which no collateral was posted to cover these positions.

In comparison, as of December 31, 2022, the aggregate fair value amounts of all derivative instruments with credit risk-related contingent features that were in a net liability position totaled $ 3 million, for which $ 1 million of collateral was posted to cover these positions.

As of December 31, 2024, the aggregate fair value amounts of all derivative instruments with credit risk-related contingent features that were in a net liability position totaled $ 1 million, for which $ 1 million collateral was posted to cover these positions.

In comparison, as of December 31, 2023, the aggregate fair value amounts of all derivative instruments with credit risk-related contingent features that were in a net liability position totaled $ 9 thousand, for which no collateral was posted to cover these positions.

In the event that the credit rating of East West Bank had been downgraded to below investment grade, minimal additional collateral would have been required to be posted as of both December 31, 2024 and 2023.

1 unchanged sentence

The following tables present the gross derivative fair values, the balance sheet netting adjustments, and the resulting net fair values recorded on the Consolidated Balance Sheet, as well as the cash and noncash collateral associated with master netting arrangements.

The gross amounts of derivative assets and liabilities are presented after the application of variation margin payments as settlements to the fair values of contracts cleared through central clearing organizations, where applicable.

The collateral amounts in the following tables are limited to the outstanding balances of the related asset or liability.

Therefore, instances of overcollateralization are not shown:

Therefore, instances of over-collateralization are not shown:

($ in thousands) As of December 31, 2024

Gross Amounts Recognized (1)

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet

Gross Amounts Not Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet Gross Amounts Not Offset on the Consolidated Balance Sheet

Gross Amounts Recognized (1)

Master Netting Arrangements Cash Collateral Received (3)

2 unchanged sentences

$ 95,841 $ ( 55,222 )

Gross Amounts Recognized (2)

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet

Gross Amounts Not Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet Gross Amounts Not Offset on the Consolidated Balance Sheet

Gross Amounts Recognized (2)

Master Netting Arrangements Cash Collateral Pledged (4)

3 unchanged sentences

($ in thousands) As of December 31, 2023

Gross Amounts Recognized (1)

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet

Gross Amounts Not Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet Gross Amounts Not Offset on the Consolidated Balance Sheet

Gross Amounts Recognized (1)

Master Netting Arrangements Cash Collateral Received (3)

1 unchanged sentence

Derivative assets $ 610,920 $ ( 75,534 ) $ ( 237,258 ) $ 298,128 $ ( 246,259 ) $ 51,869

Gross Amounts Recognized (2)

Gross Amounts Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet

Gross Amounts Not Offset on the Consolidated Balance Sheet

Net Amounts Presented on the Consolidated Balance Sheet Gross Amounts Not Offset on the Consolidated Balance Sheet

Gross Amounts Recognized (2)

Master Netting Arrangements Cash Collateral Pledged (4)

5 unchanged sentences

Of the gross cash collateral received, $ 316 million and $ 237 million were used to offset against derivative assets as of December 31, 2024 and 2023, respectively.

(4) Gross cash collateral pledged under master netting arrangements or similar agreements were $ 1 million and $ 490 thousand as of December 31, 2023 and 2022, respectively.

Of the gross cash collateral pledged, $ 1 million was used to offset against derivative liabilities as of December 31, 2023.

In comparison, no cash collateral was used to offset against derivative liabilities as of December 31, 2022.

(4) Gross cash collateral pledged under master netting arrangements or similar agreements were $ 1 million as of both December 31, 2024 and 2023.

Of the gross cash collateral pledged, $ 1 million cash collateral was used to offset against derivative liabilities as of both December 31, 2024 and 2023.

(5) Represents the fair value of security collateral received or pledged limited to derivative assets or liabilities that are subject to enforceable master netting arrangements or similar agreements.

1 unchanged sentence

In addition to the amounts included in the tables above, the Company has balance sheet netting related to the resale and repurchase agreements.

Refer to Note 3 — Assets Purchased under Resale Agreements and Sold under Repurchase Agreements to the Consolidated Financial Statements in this Form 10-K for additional information.

Refer to Note 3 — Securities Purchased under Resale Agreements to the Consolidated Financial Statements in this Form 10-K for additional information.

Refer to Note 2 — Fair Value Measurement and Fair Value of Financial Instruments to the Consolidated Financial Statements in this Form 10-K for fair value measurement disclosures on derivatives.

25 unchanged sentences

For the Company’s accounting policy on loans held-for-sale, refer to Note 1 — Summary of Significant Accounting Policies — Loans Held-for-Sale to the Consolidated Financial Statements in this Form 10-K.

The Company’s FRBSF and FHLB borrowings are primarily secured by loans held-for-investment.

The Company’s FRB and FHLB borrowings are primarily secured by loans held-for-investment.

Loans held-for-investment totaling $ 38.2 billion and $ 37.2 billion, respectively, were pledged to secure borrowings and provide additional borrowing capacity as of December 31, 2024 and 2023.

16 unchanged sentences

The Company reviews the internal risk ratings of its loan portfolio on a regular basis, and adjusts the ratings based on changes in the borrowers’ financial status and the collectability of the loans.

The following tables summarize the Company’s loans held-for-investment and current year-to-date gross write-offs by loan portfolio segments, internal risk ratings and vintage year as of December 31, 2023 and 2022.

The following tables summarize the Company’s loans held-for-investment and year-to-date gross write-offs by loan portfolio segments, internal risk ratings and vintage year as of December 31, 2024 and 2023.

The vintage year is the year of loan origination, renewal or major modification.

Revolving loans that are converted to term loans presented in the tables below are excluded from term loans by vintage year columns.

Gross write-offs in the following tables are for the years ended December 31, 2024 and 2023.

Revolving loans that are converted to term loans presented in the tables below are excluded from the term loans by vintage year columns.

December 31, 2024

4 unchanged sentences

Criticized (nonaccrual)

3,822 29,181 20,273 10,666 3,225 9,135 9,863 — 86,165

Total C&I 2,644,162 1,589,544 1,080,900 730,036 257,291 336,179 10,736,014 23,032 17,397,158

YTD gross write-offs (2)

Gross write-offs (2)

20 47,963 14,848 11,119 1,568 3,012 27,099 — 105,629

2 unchanged sentences

Criticized (nonaccrual)

— — — — 1,756 674 — — 2,430

Subtotal CRE 1,695,420 2,341,320 3,782,603 1,956,835 1,373,773 3,344,525 96,791 64,073 14,655,340

YTD gross write-offs (2)

Gross write-offs (2)

— — — — — 3 — — 3

3 unchanged sentences

Criticized (nonaccrual)

— — — — — 4,572 — — 4,572

Subtotal multifamily residential 386,743 521,754 1,381,596 784,272 613,115 1,250,069 14,640 1,253 4,953,442

YTD gross write-offs

Gross write-offs

— — — — — 10 — — 10

1 unchanged sentence

Pass 90,926 328,803 184,792 41,932 — 8,393 — — 654,846

Criticized (accrual) — — — — — — — — —

Criticized (nonaccrual)

— — 11,316 — — — — — 11,316

Subtotal construction and land 90,926 328,803 196,108 41,932 — 8,393 — — 666,162

YTD gross write-offs (2)

Gross write-offs

— — 2,289 — — — — — 2,289

Total CRE 2,173,089 3,191,877 5,360,307 2,783,039 1,986,888 4,602,987 111,431 65,326 20,274,944

YTD gross write-offs (2)

Total CRE gross write-offs (2)

— — 2,289 — — 13 — — 2,302

Total commercial $ 4,817,251 $ 4,781,421 $ 6,441,207 $ 3,513,075 $ 2,244,179 $ 4,939,166 $ 10,847,445 $ 88,358 $ 37,672,102

YTD total commercial gross write-offs (2)

Total commercial gross write-offs (2)

$ 20 $ 47,963 $ 17,137 $ 11,119 $ 1,568 $ 3,025 $ 27,099 $ — $ 107,931

9 unchanged sentences

Subtotal single-family residential mortgage 2,367,565 2,776,003 3,077,347 2,087,168 1,410,983 2,456,380 — — 14,175,446

YTD gross write-offs — — — — — — — — —

Gross write-offs (2)

9 — — — — — — — 9

Pass 7,453 3,288 4,071 3,236 7,570 8,152 1,648,337 99,488 1,781,595

1 unchanged sentence

Criticized (nonaccrual)

3,161 3,095 2,520 39 418 7,301 — 5,512 22,046

Subtotal HELOCs 12,050 6,383 8,011 3,275 8,123 17,517 1,650,675 105,594 1,811,628

YTD gross write-offs (2)

Gross write-offs

— 10 — — — — — 5 15

Total residential mortgage 2,379,615 2,782,386 3,085,358 2,090,443 1,419,106 2,473,897 1,650,675 105,594 15,987,074

YTD gross write-offs (2)

Total residential mortgage gross write-offs (2)

9 10 — — — — — 5 24

1 unchanged sentence

Pass 14,916 — 22,992 132 — 6,800 22,555 — 67,395

Criticized (accrual) — — — — — — — — —

Criticized (nonaccrual)

— — — — — — 66 — 66

Total other consumer 14,916 — 22,992 132 — 6,800 22,621 — 67,461

YTD gross write-offs (2)

Gross write-offs (2)

— 3,000 — — — — 890 — 3,890

Total consumer $ 2,394,531 $ 2,782,386 $ 3,108,350 $ 2,090,575 $ 1,419,106 $ 2,480,697 $ 1,673,296 $ 105,594 $ 16,054,535

YTD total consumer gross write-offs (2)

Total consumer gross write-offs (2)

$ 9 $ 3,010 $ — $ — $ — $ — $ 890 $ 5 $ 3,914

3 unchanged sentences

Criticized (nonaccrual)

9,699 41,949 36,038 12,740 7,803 34,547 9,929 5,512 158,217

Total $ 7,211,782 $ 7,563,807 $ 9,549,557 $ 5,603,650 $ 3,663,285 $ 7,419,863 $ 12,520,741 $ 193,952 $ 53,726,637

YTD total loans held-for-investment gross write-offs (2)

Total loans held-for-investment gross write-offs (2)

$ 29 $ 50,973 $ 17,137 $ 11,119 $ 1,568 $ 3,025 $ 27,989 $ 5 $ 111,845

5 unchanged sentences

Criticized (nonaccrual)

2,104 7,916 131 4,819 2,979 18,137 950 — 37,036

Total C&I 2,421,686 1,704,375 1,417,641 351,865 289,072 204,394 10,171,903 20,143 16,581,079

Gross write-offs (2)

350 10,454 424 3,758 9,748 2,648 1,593 — 28,975

Pass 2,492,915 4,086,385 2,216,257 1,428,724 1,600,844 2,494,382 92,851 62,771 14,475,129

2 unchanged sentences

Subtotal CRE 2,529,770 4,120,870 2,246,593 1,476,974 1,625,725 2,621,527 92,851 62,771 14,777,081

Gross write-offs (2)

— — — — — 1,329 — — 1,329

Multifamily residential:

3 unchanged sentences

Subtotal multifamily residential 665,780 1,484,517 862,947 612,408 499,184 888,356 8,690 1,281 5,023,163

Gross write-offs

— — — — — 3 — — 3

Construction and land:

Pass 209,775 280,151 120,724 39,928 808 5,501 6,981 $ — 663,868

Criticized (accrual) 4,504 — — — 21,666 — — — 26,170

Criticized (nonaccrual) — — — — — — — — —

Subtotal construction and land

209,775 280,151 120,724 39,928 808 5,501 6,981 — 663,868

Total CRE 3,405,325 5,885,538 3,230,264 2,129,310 2,125,717 3,515,384 108,522 64,052 20,464,112

Total CRE gross write-offs (2)

— — — — — 1,332 — — 1,332

Total commercial $ 5,827,011 $ 7,589,913 $ 4,647,905 $ 2,481,175 $ 2,414,789 $ 3,719,778 $ 10,280,425 $ 84,195 $ 37,045,191

Total commercial gross write-offs (2)

$ 350 $ 10,454 $ 424 $ 3,758 $ 9,748 $ 3,980 $ 1,593 $ — $ 30,307

December 31, 2023

Term Loans by Origination Year

($ in thousands) 2023 2022 2021 2020 2019 Prior Revolving Loans Revolving Loans Converted to Term Loans (1)

Residential mortgage:

Single-family residential:

8 unchanged sentences

Subtotal HELOCs 5,021 5,957 4,019 3,326 1,498 17,584 1,553,901 130,898 1,722,204

Gross write-offs (2)

— — — — — 41 — 6 47

Total residential mortgage 3,200,997 3,352,054 2,288,289 1,601,372 987,313 1,990,440 1,553,901 130,898 15,105,264

Total residential mortgage gross write-offs (2)

— — — — — 41 — 6 47

Other consumer:

Pass 2,286 18,098 135 — — 13,244 26,432 — 60,195

Criticized (accrual) 3 — — — — — — — 3

Criticized (nonaccrual) — — — — — — 132 — 132

1 unchanged sentence

Total consumer $ 3,203,283 $ 3,370,152 $ 2,288,424 $ 1,601,372 $ 987,313 $ 2,003,684 $ 1,580,465 $ 130,898 $ 15,165,591

Total consumer gross write-offs (2)

$ — $ — $ — $ — $ — $ 41 $ — $ 6 $ 47

Total by Risk Rating:

2 unchanged sentences

Criticized (nonaccrual)

7,385 9,609 4,446 6,972 7,633 61,189 1,361 3,529 102,124

Total $ 9,030,294 $ 10,960,065 $ 6,936,329 $ 4,082,547 $ 3,402,102 $ 5,723,462 $ 11,860,890 $ 215,093 $ 52,210,782

(1) $ 29 million, $ 26 million and $ 6 million of total commercial loans, primarily comprised of CRE revolving loans, converted to term loans during the years ended December 31, 2023, 2022 and 2021, respectively.

During the years ended December 31, 2023 and 2021, respectively, $ 44 million and $ 54 million of total consumer loans, comprised of HELOCs, converted to term loans.

For the year ended December 31, 2022, no consumer loans converted to term loans.

Total loans held-for-investment gross write-offs (2)

$ 350 $ 10,454 $ 424 $ 3,758 $ 9,748 $ 4,021 $ 1,593 $ 6 $ 30,354

(1) $ 7 million of total commercial loans, comprised of CRE and C&I revolving loans, were converted to term loans during the year ended December 31, 2024.

In comparison, $ 29 million and $ 26 million of total commercial loans, primarily comprised of CRE revolving loans, were converted to term loans during the years ended December 31, 2023 and 2022, respectively.

During the years ended December 31, 2024 and 2023, respectively, $ 22 million and $ 44 million of total consumer loans, comprised of HELOCs, were converted to term loans.

For the year ended December 31, 2022, no consumer loans were converted to term loans.

(2) Excludes gross write-offs associated with loans the Company sold or settled.

35 unchanged sentences

Total $ 51,984,909 $ 88,791 $ 34,208 $ 122,999 $ 102,874 $ 52,210,782

The following table presents the amortized cost of loans on nonaccrual status for which there was no related allowance for loan losses as of both December 31, 2023 and 2022.

The following table presents the amortized cost of loans on nonaccrual status for which there was no related allowance for loan losses as of December 31, 2024 and 2023.

Nonaccrual loans may not have an allowance for credit losses if the loan balances are well secured by collateral values and there is no loss expectation.

1 unchanged sentence

C&I $ 79,591 $ 33,089

CRE 22,653 22,944

Multifamily residential 4,210 4,235

Construction and land

Total commercial 95,117 59,977

8 unchanged sentences

Foreclosed assets, consisting of OREO and other nonperforming assets, are included in Other assets on the Consolidated Balance Sheet.

The Company had $ 11 million in foreclosed assets as of December 31, 2023, compared with $ 270 thousand as of December 31, 2022.

The Company had $ 35 million of foreclosed assets as of December 31, 2024, compared with $ 11 million as of December 31, 2023.

The Company commences the foreclosure process on consumer mortgage loans after a borrower becomes more than 120 days delinquent in accordance with the Consumer Financial Protection Bureau guidelines.

1 unchanged sentence

Loan Modifications to Borrowers Experiencing Financial Difficulty

Effective January 1, 2023, the Company adopted ASU 2022-02, which in part eliminated the accounting for TDR and enhanced disclosure requirements for loan modifications to borrowers experiencing financial difficulty.

See Note 1 — Summary of Significant Accounting Policies — Loan Modifications to the Consolidated Financial Statements in this Form 10-K for additional information.

As part of the Company’s loss mitigation efforts, the Company may agree to modify the contractual terms of a loan to assist borrowers experiencing financial difficulty.

6 unchanged sentences

Insignificant payment deferrals (three months or less in the last 12 months) are also not included in the disclosure.

The following table presents the amortized cost of loans that were modified during the year ended December 31, 2023 by loan class and modification type:

The following tables present the amortized cost of loans that were modified during the years ended December 31, 2024 and 2023 by loan class and modification type:

Year Ended December 31, 2024

1 unchanged sentence

($ in thousands) Term Extension Payment Delay Combination:

Term Extension/ Payment Delay

Rate Reduction/ Term Extension

Rate Reduction/ Payment Delay

Total Modification as a % of Loan Class

Term Extension/ Payment Delay Combination:

Rate Reduction/ Term Extension Combination:

Rate Reduction/ Payment Delay Total Modification as a % of Loan Class

C&I $ 57,102 $ 26,420 $ — $ — $ — $ 83,522 0.48 %

CRE 86,258 — — 6,052 — 92,310 0.63 %

Total CRE 13,939 — — 32,470 — 46,409

Total commercial 143,360 26,420 — 6,052 — 175,832

Residential mortgage:

Single-family residential — 15,397 222 — 140 15,759 0.11 %

— 10,202 3,967 — — 14,169 0.11 %

HELOCs — 14,303 — — 517 14,820 0.82 %

Total residential mortgage — 13,350 5,137 — 815 19,302

Total consumer — 29,700 222 — 657 30,579

Total $ 143,360 $ 56,120 $ 222 $ 6,052 $ 657 $ 206,411

The following table presents the financial effects of the loan modifications for the year ended December 31, 2023 by loan class and modification type:

Year Ended December 31, 2023

Modification Type

($ in thousands) Term Extension Payment Delay Combination:

Term Extension/ Payment Delay Combination:

Rate Reduction/ Term Extension Combination:

Rate Reduction/ Payment Delay Total Modification as a % of Loan Class

C&I $ 62,704 $ 6,842 $ — $ — $ — $ 69,546 0.42 %

CRE 13,939 — — 32,470 — 46,409 0.31 %

Total commercial 76,643 6,842 — 32,470 — 115,955

Single-family residential — 10,202 3,967 — — 14,169 0.11 %

HELOCs — 3,148 1,170 — 815 5,133 0.30 %

Total consumer — 13,350 5,137 — 815 19,302

Total $ 76,643 $ 20,192 $ 5,137 $ 32,470 $ 815 $ 135,257

The following tables present the financial effects of the loan modifications for the years ended December 31, 2024 and 2023 by loan class and modification type:

Financial Effects of Loan Modifications

Year Ended December 31, 2024

($ in thousands) Principal Forgiveness Weighted-Average Interest Rate Reduction Weighted-Average Term Extension

(in years) Weighted-Average Payment Delay

($ in thousands) Weighted-Average Interest Rate Reduction Weighted-Average Term Extension (in years) Weighted-Average Payment Delay

C&I — % 2.1 1.7

1.3 years 0.9 years

CRE — 3.00 % 2.1 years —

Single-family residential — — % 9.3 years 1.8 years

HELOCs — 0.11 % 14.2 years 4.6 years

(1) Comprised of C&I loans modified during the year ended December 31, 2023 where the interest rate is waived in addition to principal forgiveness.

CRE 1.28 % 2.7 —

Single-family residential 1.63 % 10.0 1.3

HELOCs 0.25 % — 1.7

Financial Effects of Loan Modifications

Year Ended December 31, 2023

($ in thousands) Principal Forgiveness Weighted-Average Interest Rate Reduction Weighted-Average Term Extension (in years) Weighted-Average Payment Delay

C&I $ 371 (1)

CRE — 3.00 % 2.1 —

Single-family residential — — % 9.3 1.8

HELOCs — 0.11 % 14.2 4.6

(1) Comprised of C&I loans modified during the year ended December 31, 2023 where the interest rate was waived in addition to principal forgiveness.

No recorded investment was outstanding as of December 31, 2023.

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

During the year ended December 31, 2023 , two residential mortgage loans that were modified as payment delay totaling $ 1 million subsequently defaulted.

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

The following table presents the performance of loans that were modified as of December 31, 2023 since the adoption of ASU 2022-02 on January 1, 2023:

The following tables present information on loans that defaulted during the years ended December 31, 2024 and 2023 that received modifications during the 12 months preceding payment default.

Loans Modified Subsequently Defaulted During the Year Ended December 31, 2024

($ in thousands) Term Extension Payment Delay Combination:

Rate Reduction/ Payment Delay Combination:

Term Extension/ Payment Delay Total

C&I $ 3,684 $ 4,937 $ — $ — $ 8,621

Total commercial 3,684 4,937 — — 8,621

Single-family residential — 10,223 141 2,462 12,826

HELOCs — 4,690 517 — 5,207

Total consumer — 14,913 658 2,462 18,033

Total $ 3,684 $ 19,850 $ 658 $ 2,462 $ 26,654

Loans Modified Subsequently Defaulted During the Year Ended December 31, 2023

($ in thousands) Term Extension Payment Delay Combination:

Rate Reduction/ Payment Delay Combination:

Term Extension/ Payment Delay Total

Single-family residential $ — $ 267 $ — $ — $ 267

HELOCs — 749 — — 749

Total consumer — 1,016 — — 1,016

Total $ — $ 1,016 $ — $ — $ 1,016

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

The following table presents the performance of loans that were modified during the years ended December 31, 2024 and 2023, respectively.

Payment Performance as of December 31, 2024

($ in thousands) Current 30-89 Days Past Due

90+ Days Past Due Total

($ in thousands) Current 30-89 Days Past Due 90+ Days Past Due Total

C&I $ 71,324 $ 12,198 $ — $ 83,522

CRE 92,310 — — 92,310

Total CRE 46,409 — — 46,409

Total commercial 163,634 12,198 — 175,832

Residential mortgage:

Single-family residential 9,082 4,218 2,459 15,759

HELOCs 8,591 3,069 3,160 14,820

Total residential mortgage 15,404 2,602 1,296 19,302

Total consumer 17,673 7,287 5,619 30,579

Total $ 181,307 $ 19,485 $ 5,619 $ 206,411

As of December 31, 2023, commitments to lend additional funds to borrowers whose loans were modified were $ 4 million.

Payment Performance as of December 31, 2023

($ in thousands) Current 30-89 Days Past Due 90+ Days Past Due Total

C&I $ 52,087 $ 8,153 $ 9,306 $ 69,546

CRE 46,409 — — 46,409

Total commercial 98,496 8,153 9,306 115,955

Single-family residential 11,197 2,425 547 14,169

HELOCs 4,207 177 749 5,133

Total consumer 15,404 2,602 1,296 19,302

Total $ 113,900 $ 10,755 $ 10,602 $ 135,257

As of December 31, 2024 and 2023, commitments to lend additional funds to borrowers whose loans were modified were $ 10 million and $ 4 million, respectively.

Troubled Debt Restructurings Prior to the Adoption of ASU 2022-02

1 unchanged sentence

ASU 2022-02 eliminated TDR accounting prospectively for all restructurings occurring on or after January 1, 2023.

The following table presents the additions to TDRs for the years ended December 31, 2022, and 2021:

The following table presents the additions to TDRs for the year ended December 31, 2022:

Loans Modified as TDRs During the Year Ended

December 31, 2022 December 31, 2021

($ in thousands) Number of Loans Pre-Modification Outstanding Recorded Investment

Post-Modification Outstanding Recorded Investment (1)

Financial Impact (2)

Number of Loans Pre-Modification Outstanding Recorded Investment

Post-Modification Outstanding Recorded Investment (1)

December 31, 2022

($ in thousands) Number of Loans Pre-Modification Outstanding Recorded Investment Post-Modification Outstanding Recorded Investment (1)

Financial Impact (2)

C&I 7 $ 69,050 $ 38,415 $ 12,638

Multifamily residential — — — — 1 1,101 1,066 —

Total CRE — — — — 1 1,101 1,066 —

Total commercial 7 69,050 38,415 12,638

Residential mortgage:

HELOCs 2 662 697 2

Total residential mortgage 2 662 697 2 — — — —

Total consumer 2 662 697 2

Total 9 $ 69,712 $ 39,112 $ 12,640

(1) Includes subsequent payments after modification and reflects the balance as of December 31, 2022 and 2021.

(1) Includes subsequent payments after modification and reflects the balance as of December 31, 2022.

(2) Includes charge-offs and specific reserves recorded since the modification date.

Loans modified more than once are reported in the period they were first modified.

The following table presents the TDR post-modification outstanding balances by the primary modification type for the years ended December 31, 2022 and 2021:

The following table presents the TDR post-modification outstanding balances by the primary modification type for the year ended December 31, 2022:

Modification Type During the Year Ended

December 31, 2022 December 31, 2021

December 31, 2022

($ in thousands) Principal (1)

Interest Rate Reduction

Total Principal (1)

Interest Rate Reduction

C&I $ 24,238 $ 14,177 $ 38,415

Multifamily residential — — — — 1,066 — — 1,066

Total CRE — — — — 1,066 — — 1,066

Total commercial 24,238 14,177 38,415

Residential mortgage:

HELOCs 697 — 697

Total residential mortgage 697 — — 697 — — — —

Total consumer 697 — 697

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A TDR may become delinquent and result in payment default (generally 90 days past due) subsequent to restructuring.

The following table presents information on loans that entered into default during the years ended December 31, 2022 and 2021 that were modified as TDRs during the 12 months preceding payment default:

Loans Modified as TDRs that Subsequently Defaulted

During the Year Ended December 31,

($ in thousands) Number of Loans

Recorded Investment

Number of Loans

Recorded Investment

The following table presents information on loans that entered into default during the year ended December 31, 2022 that were modified as TDRs during the 12 months preceding payment default:

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

($ in thousands) Number of Loans Recorded Investment

C&I 2 $ 10,296

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Single-family residential and HELOCs FICO score, delinquency status, maturity date, collateral value, and geographic location Unemployment rate, GDP, and Home Price Indices

Other consumer Loss rate approach Immaterial (2)

(1) Macroeconomic variables were updated due to model redevelopment.

(2) Macroeconomic variables are included in the qualitative estimate.

Other consumer Loss rate approach Immaterial - Macroeconomic variables are included in the qualitative estimate.

Quantitative Component — Allowance for Loan Losses for the Commercial Loan Portfolio

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The lifetime loss rate model’s reasonable and supportable period spans eight quarters, thereafter immediately reverting to the historical average loss rate, expressed through the loan-level lifetime loss rate.

To generate estimates of expected loss at the loan level for CRE, multifamily residential, and construction and land loans, projected PDs and LGDs are applied to the estimated exposure at default, considering the term and payment structure of the loan.

To generate estimates of expected loss at the loan level for CRE, multifamily residential, and construction and land loans, projected probabilities of default (“PDs”) and loss given defaults (“LGDs”) are applied to the estimated exposure at default, considering the term and payment structure of the loan.

The forecast of future economic conditions returns to long-run historical economic trends within the reasonable and supportable period.

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For other consumer loans, the Company uses a loss rate approach.

Qualitative Component — The Company also considers the following qualitative factors in the determination of the collectively evaluated allowance if these factors have not already been captured by the quantitative model.

Qualitative Component — The Company considers the following qualitative factors in the determination of the collectively evaluated allowance if these factors have not already been captured by the quantitative model.

Such qualitative factors may include, but are not limited to:

– loan growth trends;

– the volume and severity of past due financial assets, and the volume and severity of criticized or adversely classified financial assets;

– the volume and severity of past due financial assets, and criticized or adversely classified financial assets;

– the Company’s lending policies and procedures, including changes in lending strategies, underwriting standards, collection, write-off and recovery practices;

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In comparison, collateral-dependent commercial and consumer loans totaled $ 30 million and $ 12 million, respectively, as of December 31, 2023.

The collateral-dependent loans decreased from December 31, 2022, predominantly driven by the adoption of ASU 2022-02 which eliminated TDR guidance.

The Company's collateral-dependent loans were secured by real estate.

As of both December 31, 2023 and 2022, the collateral value of the properties securing the collateral-dependent loans, net of selling costs, exceeded the recorded value of the loans.

As of both December 31, 2024 and 2023, the collateral value of the properties securing the collateral-dependent loans, net of selling costs, exceeded the recorded value of the majority of the loans.

The following tables summarize the activity in the allowance for loan losses by portfolio segments for the years ended December 31, 2024, 2023 and 2022:

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CRE Residential Mortgage

($ in thousands) C&I CRE Multifamily Residential

Construction and Land

Single-Family Residential

HELOCs Other Consumer Total

Allowance for loan losses, December 31, 2022 $ 371,700 $ 149,864 $ 23,373 $ 9,109 $ 35,564 $ 4,475 $ 1,560 $ 595,645

Impact of ASU 2022-02 adoption 5,683 337 6 — 1 1 — 6,028

($ in thousands) C&I CRE Multifamily Residential Construction and Land Single-Family Residential HELOCs Other Consumer Total

Allowance for loan losses, beginning of period $ 392,685 $ 170,592 $ 34,375 $ 10,469 $ 55,018 $ 3,947 $ 1,657 $ 668,743

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CRE Residential Mortgage

($ in thousands) C&I CRE Multifamily Residential

Construction and Land

Single-Family Residential

HELOCs Other Consumer Total

($ in thousands) C&I CRE Multifamily Residential Construction and Land Single-Family Residential HELOCs Other Consumer Total

Allowance for loan losses, December 31, 2022 $ 371,700 $ 149,864 $ 23,373 $ 9,109 $ 35,564 $ 4,475 $ 1,560 $ 595,645

Impact of ASU 2022-02 adoption 5,683 337 6 — 1 1 — 6,028

Allowance for loan losses, beginning of period 377,383 150,201 23,379 9,109 35,565 4,476 1,560 601,673

$ 338,252 $ 150,940 $ 14,400 $ 15,468 $ 17,160 $ 3,435 $ 1,924 $ 541,579

Provision for (reversal of) credit losses on loans (a) 45,319 27,007 10,454 11,537 19,384 ( 424 ) 294 113,571

Gross charge-offs ( 36,573 ) ( 7,048 ) ( 3 ) ( 10,413 ) — ( 138 ) ( 197 ) ( 54,372 )

( 18,738 ) ( 10,871 ) ( 7,237 ) — ( 775 ) ( 193 ) ( 106 ) ( 37,920 )

Gross recoveries 6,803 432 545 236 69 33 — 8,118

16,824 1,583 559 74 312 109 — 19,461

Total net (charge-offs) recoveries ( 29,770 ) ( 6,616 ) 542 ( 10,177 ) 69 ( 105 ) ( 197 ) ( 46,254 )

( 1,914 ) ( 9,288 ) ( 6,678 ) 74 ( 463 ) ( 84 ) ( 106 ) ( 18,459 )

Foreign currency translation adjustment ( 247 ) — — — — — — ( 247 )

3 unchanged sentences

CRE Residential Mortgage

($ in thousands) C&I CRE Multifamily Residential

Construction and Land

Single-Family Residential

HELOCs Other Consumer Total

($ in thousands) C&I CRE Multifamily Residential Construction and Land Single-Family Residential HELOCs Other Consumer Total

Allowance for loan losses, beginning of period $ 338,252 $ 150,940 $ 14,400 $ 15,468 $ 17,160 $ 3,435 $ 1,924 $ 541,579

(Reversal of) provision for credit losses on loans (a) ( 39,732 ) 14,282 ( 15,076 ) 7,576 1,965 745 1,286 ( 28,954 )

Provision for (reversal of) credit losses on loans (a) 37,604 8,212 15,651 ( 6,433 ) 18,867 1,124 ( 258 ) 74,767

Gross charge-offs ( 18,738 ) ( 10,871 ) ( 7237 ) — ( 775 ) ( 193 ) ( 106 ) ( 37,920 )

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See Note 12 — Commitments and Contingencies to the Consolidated Financial Statements in this Form 10-K for additional information related to unfunded credit commitments.

The following table summarizes the activities in the allowance for unfunded credit commitments for the years ended December 31, 2023, 2022 and 2021:

The following table summarizes the activity in the allowance for unfunded credit commitments for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,

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Allowance for unfunded credit commitments, beginning of period $ 37,699 $ 26,264 $ 27,514

Provision for (reversal of) credit losses on unfunded credit commitments

(b) 11,429 ( 1,267 ) ( 6,046 )

Provision for (reversal of) credit losses on unfunded credit commitments (b) 1,824 11,429 ( 1,267 )

Foreign currency translation adjustments 3 6 17

Allowance for unfunded credit commitments, end of period 39,526 37,699 26,264

Provision for (reversal of) credit losses (a) + (b) $ 125,000 $ 73,500 $ ( 35,000 )

Provision for credit losses (a) + (b) $ 174,000 $ 125,000 $ 73,500

The allowance for credit losses was $ 742 million as of December 31, 2024, compared with $ 706 million as of December 31, 2023.

The increase in the allowance for credit losses was primarily driven by net loan growth and economic forecasts that reflect continued caution regarding inflation, the high interest rate environment and the CRE market outlook.

The increase in the allowance for credit losses was primarily driven by the Company’s net loan growth, qualitative risk assessment and economic outlook that reflected continued caution regarding inflation, the high-interest rate environment and certain CRE markets.

The Company considers multiple economic scenarios to develop the estimate of the allowance for loan losses.

The scenarios may consist of a baseline forecast representing management's view of the most likely outcome, and downside or upside scenarios that reflect possible worsening or improving economic conditions.

As of both December 31, 2023 and 2022, the Company assigned the same weightings to its baseline, upside, and downside scenarios.

The current baseline economic forecast continues to reflect key risks such as high inflation, high interest rates, concerns over global conflicts and oil prices.

Compared with the December 2022 forecast, the 2023 baseline forecast projected lower annual GDP growth for 2023 and beyond, and a similarly higher unemployment rate for 2023 and beyond.

The downside scenario assumed the economy falls into recession in the first quarter of 2024 as a result of an extended federal government shutdown, global and domestic political tensions, high inflation, and increased unemployment.

The upside scenario assumed a more optimistic economic outlook for 2024, including stronger growth, stable financial market, and full employment starting in the first quarter of 2024.

As of December 31, 2024, the Company assigned the same weightings to its baseline, while slightly higher and lower weightings were applied to the upside and downside scenarios, respectively, as compared with December 31, 2023.

The current baseline economic forecast continues to reflect key risks such as still-elevated interest rates, inflation, concerns over global conflicts and oil prices.

Compared to December 2023, the December 2024 baseline forecast for GDP growth showed improvement in the near-term (full year 2025) and worsening for longer-term (2026 and beyond).

The unemployment rate has remained low with the December 2024 forecast showing a small uptick beginning in 2026, compared with the December 2023 forecast for the same periods.

The downside scenario assumed the economy falls into recession in the first quarter of 2025 as a result of tariffs, rising inflation, high interest rates, global and domestic political tensions, and reduced credit availability.

The upside scenario assumed a more optimistic economic outlook, including stronger growth, stable financial market, and full employment starting in the first quarter of 2025.

Loan Transfers, Sales and Purchases

The Company’s primary business focus is on directly originated loans.

The Company also purchases loans and participates in loan financing with other banks.

In the normal course of doing business, the Company also provides other financial institutions with the ability to participate in commercial loans that it originates, by selling loans to such institutions.

The Company also purchases loans from and participates in loan financing with other banks.

In the normal course of business, the Company also provides other financial institutions with the ability to participate in commercial loans that it originates, by selling loans to such institutions.

Purchased loans may be transferred from held-for-investment to held-for-sale, and write-downs to allowance for loan losses are recorded, when appropriate.

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CRE Residential Mortgage

($ in thousands) C&I CRE Multifamily Residential

Construction and Land

Single-Family Residential

($ in thousands) C&I CRE Construction and Land Single-Family Residential Total

Loans transferred from held-for-investment to held-for-sale (1)

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CRE Residential Mortgage

($ in thousands) C&I CRE Multifamily Residential

Construction and Land

Single-Family Residential

($ in thousands) C&I CRE Construction and Land Single-Family Residential Total

Loans transferred from held-for-investment to held-for-sale (1)

$ 647,943 $ 83,282 $ 8,154 $ — $ 739,379

Loans transferred from held-for-sale to held-for-investment $ — $ — $ — $ — $ 631 $ 631

$ 674,919 $ 86,749 $ 8,154 $ — $ 769,822

4 unchanged sentences

CRE Residential Mortgage

($ in thousands) C&I CRE Multifamily Residential

Construction and Land

Single-Family Residential

($ in thousands) C&I CRE Construction and Land Single-Family Residential Total

Loans transferred from held-for-investment to held-for-sale (1)

$ 530,524 $ 88,075 $ — $ 5,178 $ 623,777

Loans transferred from held-for-sale to held-for-investment $ — $ — $ — $ 631 $ 631

$ 501,289 $ 88,075 $ — $ 6,403 $ 595,767

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(2) Includes originated loans sold of $ 508 million, $ 513 million and $ 388 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Originated loans sold consisted primarily of C&I and CRE loans for all periods.

(3) Includes $ 256 million of purchased loans sold in the secondary market for the year ended December 31, 2023, compared with $ 208 million for each of the years ended December 31, 2022 and 2021.

(4) C&I loan purchases were comprised primarily of syndicated C&I term loans.

Note 7 — Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net and Variable Interest Entities

Originated loans sold consisted primarily of C&I loans for the year ended December 31, 2024 and C&I and CRE loans for the years ended December 31, 2023 and 2022.

(3) Includes $ 156 million, $ 256 million and $ 208 million of purchased loans sold in the secondary market for the years ended December 31, 2024, 2023 and 2022, respectively.

(4) C&I loan purchases were comprised of syndicated C&I term loans.

Note 7 — Affordable Housing Partnership, Tax Credit and Community Reinvestment Act Investments, Net

The CRA encourages banks to meet the credit needs of their communities, particularly low- and moderate-income individuals and neighborhoods.

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These entities are formed to develop and operate apartment complexes designed as high-quality affordable housing for lower income tenants throughout the U.S.

To fully utilize the available tax credits, each of these entities must meet the regulatory affordable housing requirements for a 15-year minimum compliance period.

In addition to affordable housing projects, the Company invests in small business investment companies and new market tax credit projects that qualify for CRA consideration, as well as eligible projects that qualify for renewable energy and historic tax credits.

Investments in renewable energy tax credits help promote the development of renewable energy sources, and investments in historic tax credits promote the rehabilitation of historic buildings and economic revitalization of the surrounding areas.

For the Company’s accounting policies on tax credit investments, see Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Securities and Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net in this Form 10-K.

For discussion on the Company’s impairment evaluation and monitoring process of tax credit investments, refer to Note 2 — Fair Value Measurement and Fair Value of Financial Instruments — Investments in Qualified Affordable Housing Partnerships, Tax Credit and Other Investments, Net to the Consolidated Financial Statements in this Form 10-K.

The following table presents the investments and unfunded commitments of the Company’s qualified affordable housing partnerships, tax credit, and other investments, net as of December 31, 2023 and 2022:

To fully utilize the available tax credits, each of these entities must meet the affordable housing regulatory requirements for a 15-year minimum compliance period.

The Company also invests in small business investment companies and new markets tax credit projects that qualify for CRA consideration, as well as eligible projects that qualify for production, historic and renewable energy tax credits.

Investments in new markets tax credits promote development in low-income communities, investments in production and renewable energy tax credits help promote the development of renewable energy sources, and investments in historic tax credits promote the rehabilitation of historic buildings and economic revitalization of the surrounding areas.

The majority of affordable housing partnership, tax credit and CRA investments discussed above are variable interest entities where the Company is a limited partner in these investments, and an unrelated third party is typically the general partner or managing member who has control over the significant activities of these investments.

While the Company’s interest in some of the investments may exceed 50% of the outstanding equity interests, the Company does not consolidate these investments due to the general partner’s or managing member’s ability to manage the entity, which is indicative of the general partner’s or managing member’s power over the entity.

The Company’s maximum exposure to loss in connection with these partnerships consists of the unamortized investment balance and any tax credits claimed that may become subject to recapture.

The Company records its investments in qualifying affordable housing partnerships, net, using PAM.

Following the adoption of ASU 2023-02 on January 1, 2024, the Company elects to account for its tax credit investments using PAM on a program-by-program basis if certain conditions are met.

For the Company’s accounting policies on tax credit investments, see Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Securities and Affordable Housing Partnership, Tax Credit and CRA Investments, Net in this Form 10-K.

For discussion on the Company’s impairment evaluation and monitoring process of tax credit investments, refer to Note 2 — Fair Value Measurement and Fair Value of Financial Instruments — Affordable Housing Partnership, Tax Credit and CRA Investments, Net to the Consolidated Financial Statements in this Form 10-K.

The following table presents the investments and unfunded commitments of the Company’s affordable housing partnership, tax credit, and CRA investments, net as of December 31, 2024 and 2023:

($ in thousands) Assets Liabilities - Unfunded Commitments (1)

Assets Liabilities - Unfunded Commitments (1)

Investments in qualified affordable housing partnerships, net $ 419,785 $ 251,746 $ 413,253 $ 266,654

Investments in tax credit and other investments, net 485,251 298,990 350,003 185,797

Affordable housing partnership investments $ 500,217 $ 280,919 $ 419,785 $ 251,746

Tax credit and CRA investments 160,429 21,202 — —

Equity method of accounting and other:

Tax credits and CRA investments 265,994 105,743 485,251 298,990

Total $ 926,640 $ 407,864 $ 905,036 $ 550,736

(1) Included in Accrued expenses and other liabilities on the Consolidated Balance Sheet.

Investments in tax credit and other investments, net presented in the table above include equity securities that are mutual funds with readily determinable fair values of $ 25 million and $ 24 million, as of December 31, 2023 and 2022, respectively.

The Company invests in these mutual funds for CRA purposes.

The following table presents additional information related to the investments in qualified affordable housing partnerships, tax credit and other investments for the years ended December 31, 2023, 2022 and 2021:

The following table presents additional information related to the investments in affordable housing partnership, tax credit and CRA investments for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,

($ in thousands) 2024 2023 2022

Investments in qualified housing partnerships, net

Tax credits and other tax benefits recognized $ 60,939 $ 52,132 $ 50,643

Amortization expense included in income tax expense $ 43,041 $ 38,759 $ 33,248

Investments in tax credit and other investments, net

Amortization of tax credit and other investments (1)

Tax credits and benefits (1) :

Affordable housing partnership investments $ 70,335 $ 60,939 $ 52,132

Tax credit and CRA investments 110,260 — —

Equity method of accounting and other:

Tax credit and CRA investments 64,720 124,433 116,132

Total tax credits and benefits $ 245,315 $ 185,372 $ 168,264

Amortization:

Affordable housing partnership investments (2)

$ 46,113 $ 43,041 $ 38,759

Unrealized gains (losses) on equity securities with readily determinable values $ 255 $ ( 2,958 ) $ ( 746 )

(1) Includes net impairment recoveries of $ 1 million, $ 469 thousand and $ 1 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Tax credit and CRA investments (3)

Equity method of accounting and other:

Tax credit and CRA investments (4) (5)

54,242 120,299 113,358

Total amortization $ 190,468 $ 163,340 $ 152,117

(1) Included in Income tax expense on the Consolidated Statement of Income for the years ended December 31, 2024, 2023 and 2022.

(2) Amortization related to investments in qualified affordable housing partnerships under PAM was recorded in Income tax expense on the Consolidated Statement of Income for the years ended December 31, 2024, 2023 and 2022.

(3) Due to the adoption of ASU 2023-02 on January 1, 2024, amortization related to qualifying tax credit investments under PAM was recorded in Income tax expense on the Consolidated Statement of Income for the year ended December 31, 2024.

(4) Amortization related to tax credit and CRA investments was recognized in Amortization of tax credit and CRA investments as part of noninterest expense on the Consolidated Statement Income for the years ended December 31, 2024, 2023 and 2022.

(5) Includes impairment of $ 1 million for the year ended December 31, 2024, and net impairment recoveries of $ 1 million and $ 469 thousand for the years ended December 31, 2023 and 2022, respectively.

The activity was primarily related to historic and/or energy tax credits.

As of December 31, 2023, the Company’s unfunded commitments related to investments in qualified affordable housing partnerships, tax credit and other investments, net are estimated to be funded as follows:

As of December 31, 2024, the Company’s unfunded commitments related to investments in affordable housing partnership, tax credit and CRA investments, net are estimated to be funded as follows:

($ in thousands) Amount

2 unchanged sentences

Total $ 407,864

Variable Interest Entities

The majority of both the investments in affordable housing partnerships and tax credit and other investments discussed above are variable interest entities where the Company is a limited partner in these partnerships, and an unrelated third party is typically the general partner or managing member who has control over the significant activities of these investments.

The Company’s maximum exposure to loss in connection with these partnerships consists of the unamortized investment balance and any tax credits claimed that may become subject to recapture.

Other Investments

The Company acquired a 49.99 % equity interest in Rayliant during the third quarter of 2023.

Rayliant is an asset manager specializing in asset allocation and investment in developed and emerging markets.

This investment will expand the Bank’s wealth management business and provide its customers with additional access to institutional-quality investment management products and services.

The investment in Rayliant is accounted for under the equity method of accounting and is included in Other assets on the Consolidated Balance Sheet.

The Company paid $ 95 million in cash and granted performance-based RSUs that are contingently issuable at vesting.

The performance-based RSUs will vest on September 1, 2028 into a variable number of the Company’s shares of common stock, ranging from 20 % to 200 % of the 349,138 shares initially underlying such performance-based RSUs, based on Rayliant’s achievement of certain financial performance targets during the future performance period.

For additional information related to these equity contracts accounted for as derivative liability, refer to Note 2 — Fair Value Measurement and Fair Value of Financial Instruments and Note 5 — Derivatives to the Consolidated Financial Statements in this Form 10-K.

The carrying value of the Company's investment in Rayliant was $ 109 million as of December 31, 2023, of which $ 101 million was comprised of equity method goodwill.

The Company also held equity securities without readily determinable fair values totaling $ 147 million and $ 146 million as of December 31, 2024 and 2023, respectively.

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The Company’s goodwill impairment test is performed annually, as of December 31, or more frequently as events occur or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying value.

The Company completed its annual goodwill impairment test as of December 31, 2023 by using a quantitative assessment, and concluded goodwill was no t impaired.

The Company completed its annual goodwill impairment test as of December 31, 2024 by using a qualitative assessment, and concluded goodwill was not impaired.

Additional information pertaining to the Company’s accounting policy for goodwill is summarized in Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Goodwill to the Consolidated Financial Statements in this Form 10-K.

The Company has an equity method investment in Rayliant and its carrying value was $ 108 million as of December 31, 2024, of which $ 101 million was comprised of equity method goodwill.

Note 9 — Deposits

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Note 10 — Short-Term Borrowings and Long-Term Debt

The following table presents details of the Company’s junior subordinated debt and short-term borrowings as of December 31, 2023 and 2022,

($ in thousands) Interest Rate

Maturity Dates

Amount Amount

The following table presents details of the Company’s BTFP borrowings, FHLB advances, and long-term debt as of December 31, 2024 and 2023:

($ in thousands) Interest Rate Maturity Dates Amount Amount

Parent company

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6.17 % 12/15/2035 $ 32,001 $ 148,249

2034 — 2037 $ 148,249 $ 147,950

Short-term borrowings 4.37 % 3/19/2024 $ 4,500,000 $ —

(1) The weighted-average contractual interest rates for junior subordinated debt were 6.87 % and 3.49 % as of December 31, 2023 and 2022, respectively.

(2) During the third quarter of 2023, all junior subordinated debt that referenced London Interbank Offered Rate transitioned to a Secured Overnight Financing Rate (“SOFR”)-based replacement rate plus the applicable stated margin.

Short-Term Borrowings — Bank Term Funding Program

As of December 31, 2023 , the Company’s short-term borrowings consisted of funds from the Bank Term Funding Program (“BTFP”), which was designed by the Federal Reserve to provide additional liquidity to U.S.

depository institutions.

The advances are limited to the par value of eligible collateral pledged by the borrower, for a term of up to one year.

federally insured depository institutions can request advances under the BTFP until at least March 11, 2024.

The Company pledged eligible U.S.

government agency and U.S.

government-sponsored enterprise debt and mortgage-backed securities, and U.S.

Treasury securities as collateral for the borrowings under the BTFP.

As of December 31, 2023, the carrying amount of the Company’s pledged securities to the BTFP totaled $ 4.3 billion with a remaining borrowing capacity of $ 121 million.

In comparison, there were no short-term borrowings as of December 31, 2022.

Long-Term Debt — Junior Subordinated Debt

As of December 31, 2023, East West had six statutory business trusts for the purpose of issuing junior subordinated debt to third party investors.

The junior subordinated debt was issued in connection with the East West’s various pooled trust preferred securities offerings.

The Trusts issued both fixed and variable rate capital securities, representing undivided preferred beneficial interests in the assets of the Trusts, to third party investors.

East West is the owner of all the beneficial interests represented by the common securities of the Trusts.

The junior subordinated debt is recorded as a component of long-term debt and includes the value of the common stock issued by six of East West’s wholly-owned subsidiaries in conjunction with these transactions.

The common stock is recorded in Other assets on the Consolidated Balance Sheet for the amount issued in connection with these junior subordinated debt issuances.

The proceeds from these issuances represent liabilities of East West to the Trusts and are reported as a component of L o ng-term debt on the Consolidated Balance Sheet.

Interest payments on these securities are disbursed quarterly and are deductible for tax purposes.

The following table presents the outstanding junior subordinated debt issued by each trust as of December 31, 2023 and 2022:

December 31, 2023 December 31, 2022

Issuer Stated Maturity (1)

Stated Interest Rate

Current Rate Aggregate Principal Amount of Trust Securities

Aggregate Principal Amount of the Junior Subordinated Debt

Aggregate Principal Amount of Trust Securities

Aggregate Principal Amount of the Junior Subordinated Debt

($ in thousands)

East West Capital Trust V November 2034 3-month CME Term SOFR + 2.06 %

7.44 % $ 464 $ 15,000 $ 464 $ 15,000

East West Capital Trust VI September 2035 3-month CME Term SOFR + 1.76 %

7.15 % 619 20,000 619 20,000

East West Capital Trust VII June 2036 3-month CME Term SOFR + 1.61 %

BTFP borrowings

4.37 % 3/19/2024 $ — $ 4,500,000

East West Capital Trust VIII June 2037 3-month CME Term SOFR + 1.66 %

FHLB advances (2) :

4.56 % — 4.61 %

East West Capital Trust IX September 2037 3-month CME Term SOFR + 2.16 %

2025 $ 3,000,000 $ —

MCBI Statutory Trust I December 2035 3-month CME Term SOFR + 1.81 %

Fixed 3.87 % — 3.95 %

2026 500,000 —

Total $ 4,641 $ 148,000 $ 4,641 $ 148,000

(1) The debt instruments above mature in more than five years after December 31, 2023 and are subject to call options where early redemption requires appropriate notice.

Total FHLB advances $ 3,500,000 $ —

(1) As of December 31, 2024, the remaining junior subordinated debt outstanding was issued by MCBI Statutory Trust I that had a stated interest rate of 3-month CME Term Secured Overnight Financing Rate ("SOFR") + 1.81 %.

The weighted-average contractual interest rates for junior subordinated debt were 6.17 % and 6.87 % as of December 31, 2024 and 2023, respectively.

(2) The weighted-average interest rate for FHLB advances was 4.48 % as of December 31, 2024.

(3) Floating interest rates are based on the SOFR plus the established spread.

Bank Term Funding Program

As of December 31, 2023, the Company’s short-term borrowings consisted of funds from the BTFP, which were repaid upon maturity in March 2024.

FHLB Advances

The Bank’s available borrowing capacity from FHLB advances totaled $ 9.9 billion as of December 31, 2024.

The Bank’s available borrowing capacity from the FHLB is derived from its portfolio of loans that are pledged to the FHLB, reduced by any outstanding FHLB advances.

As of December 31, 2024, all advances were secured by real estate loans.

In comparison, there were no FHLB advances borrowings as of December 31, 2023 .

Long-Term Debt — Junior Subordinated Debt

As of December 31, 2024, East West had one statutory business trust for the purpose of holding junior subordinated debt issued to third party investors.

The proceeds from these issuances represent liabilities of East West to the Trust and are reported as a component of L o ng-term debt on the Consolidated Balance Sheet.

Interest payments on these securities are disbursed quarterly and are deductible for tax purposes.

During the first quarter of 2024, the Company redeemed approximately $ 117 million of junior subordinated debt.

The remaining outstanding principal amounts included $ 35 million of junior subordinated debt and $ 1 million of t rust preferred securities as of December 31, 2024.

Note 11 — Income Taxes

2 unchanged sentences

($ in thousands) 2024 2023 2022

Current income tax expense (benefit):

Current income tax expense:

Federal $ 166,268 $ 172,428 $ 163,797

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Foreign ( 2,234 ) ( 1,405 ) 1,331

Total deferred income tax (benefit) expense

Total deferred income tax benefit

( 14,283 ) ( 49,139 ) ( 43,988 )

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federal income tax effect 7.7 8.1 7.8

Tax credits and benefits, net of related expenses

Tax credits and benefits, net of amortization

( 7.4 ) ( 9.9 ) ( 8.9 )

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Allowance for credit losses and nonperforming assets valuation allowance $ 233,879 $ 217,731

Investments in qualified affordable housing partnerships, tax credit and other investments, net 28,216 21,011

Net unrealized losses on AFS debt and transferred securities

223,814 246,835

Stock compensation and other accrued compensation 41,118 33,169

Interest income on nonaccrual loans 7,034 5,185

State taxes 9,885 13,259

Net unrealized losses on debt securities and derivatives 242,303 309,837

Premises and equipment 1,782 3,827

Lease liabilities 27,644 32,636

FDIC special assessment charge 16,843 22,212

Basis difference in investments

17,708 28,216

State capital loss and tax credit carryforwards

Nonaccrual loans’ interest income

State taxes 5,808 9,885

Other 14,665 10,535

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Deferred tax liabilities:

Operating lease right-of-use assets $ 25,647 $ 30,272

Basis difference in investments

25,587 23,103

Equipment lease financing 10,395 15,564

Investments in qualified affordable housing partnerships, tax credit and other investments, net

Prepaid expenses 2,319 2,981

FHLB stock dividends 1,961 1,947

Mortgage servicing assets 1,678 2,102

Acquired debts 1,398 1,477

Prepaid expenses 2,981 2,478

Operating lease right-of-use assets 30,272 32,606

Other 20,479 13,801

1 unchanged sentence

Net deferred tax assets $ 513,344 $ 518,749

The Company has not repatriated and does not intend to repatriate earnings from its foreign subsidiary.

The Company determined such earnings are to be indefinitely reinvested in the local jurisdiction.

The related unrecognized deferred tax liability on these earnings is immaterial.

As of December 31, 2024, the Company had deferred tax assets of $ 8 million and $ 3 million related to state capital loss carryforwards and state tax credit carryforwards, respectively.

These carryforwards are expected to be fully utilized before they start to expire in 2027.

As of both December 31, 2024 and 2023, the Company concluded that no valuation allowance was necessary to reduce the deferred tax assets since estimated future taxable income will be sufficient to utilize these assets.

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Ending balance $ 4,670 $ 1,193 $ 477

(1) In 2024, the increase in positions related to prior years primarily related to proposed adjustments resulting from examination of the Company’s state tax returns.

(2) In 2022, the Company settled an issue regarding previously claimed tax credits related to DC Solar and affiliates.

The Company recognizes interest and penalties, as applicable, related to the underpayment of income taxes as a component of Income tax expense on the Consolidated Statement of Income.

The amount of net interest and penalties related to unrecognized tax benefits was immaterial for all periods presented.

The Company recorded net interest expense of $ 1 million for the year ended December 31, 2024.

In comparison, the net interest and penalties related to unrecognized tax benefits were immaterial for the years ended December 31, 2023 and 2022.

Total accrued interest included in Accrued expenses and other liabilitie s on the Consolidated Balance Sheet was $ 1 million as of December 31, 2024 and immaterial as of December 31, 2023.

The Company files federal income tax returns, as well as returns in various state and foreign jurisdictions.

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The Company is subject to federal income tax examination for the tax years 2021 and forward.

The Company is also subject to tax examination in various state and local jurisdictions for the tax years 2017 and forward.

With few exceptions, the Company is also subject to tax examination in various state and local jurisdictions for the tax years 2020 and forward.

The Company does not believe that the outcome of unresolved issues or claims in any of the tax jurisdictions is likely to be material on the Company’s Consolidated Financial Statements.

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The following table presents the Company’s credit-related commitments as of December 31, 2024 and 2023:

($ in thousands) Expire in One Year or Less Expire After One Year Through Three Years

Expire After Three Years Through Five Years

Expire After Five Years Total Total

($ in thousands) Expire in One Year or Less Expire After One Year Through Three Years Expire After Three Years Through Five Years Expire After Five Years Total Total

Loan commitments $ 4,741,319 $ 3,640,167 $ 661,403 $ 85,151 $ 9,128,040 $ 9,141,447

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In comparison, as of December 31, 2023, total letters of credit of $ 2.6 billion consisted of SBLCs of $ 2.6 billion and commercial letters of credit of $ 24 million.

As of both December 31, 2023 and 2022, substantially all SBLCs were graded “Pass” using the Bank’s internal credit risk rating system.

As of both December 31, 2024 and 2023, substantially all letters of credit were graded “Pass” using the Bank’s internal credit risk rating system.

The Company applies the same credit underwriting criteria to extend loans, commitments and conditional obligations to customers.

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The Company is obligated to repurchase up to the recourse component of the loans if the loans default.

The following table presents the carrying amounts of loans sold or securitized with recourse and the maximum potential future payments as of December 31, 2023 and 2022:

The following table presents the maximum potential future payments and carrying value of loans sold or securitized with recourse as of December 31, 2024 and 2023:

Maximum Potential Future Payments Carrying Value (1)

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2024 2023 2024 2023

($ in thousands) Expire in One Year or Less Expire After One Year Through Three Years Expire After Three Years Through Five Years

Expire After Five Years Total Total Total Total

($ in thousands) Expire in One Year or Less Expire After One Year Through Three Years Expire After Three Years Through Five Years Expire After Five Years Total Total Total Total

Single-family residential loans sold or securitized with recourse $ 10 $ — $ 40 $ 4,325 $ 4,375 $ 5,888 $ 4,375 $ 5,888

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Total $ 10 $ — $ 185 $ 19,176 $ 19,371 $ 20,884 $ 22,145 $ 24,908

(1) Represents the unpaid principal balance.

The Company’s recourse reserve related to these guarantees is included in the allowance for unfunded credit commitments and totaled $ 34 thousand and $ 40 thousand as of December 31, 2024 and 2023, respectively.

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Thus, the Company’s exposure and ultimate losses may be higher, and possibly significantly more than the amounts accrued.

While it is impossible to ascertain the ultimate resolution or range of financial liability, based on information known to

the Company as of December 31, 2023, the Company does not believe there are any pending legal proceedings to which the Company is a party that, individually or in the aggregate, would reasonably be expected to have a material adverse effect on the Company’s financial condition.

While it is impossible to ascertain the ultimate resolution or range of financial liability, based on information known to the Company as of December 31, 2024, the Company does not believe there are any pending legal proceedings to which the Company is a party that, individually or in the aggregate, would reasonably be expected to have a material adverse effect on the Company’s financial condition.

In light of the inherent uncertainty in legal proceedings, however, there can be no assurance that the ultimate resolution will not exceed established reserves and it is possible that the outcome of a particular matter, or a combination of matters, may be material to the Company’s financial condition for a particular period, depending upon the size of the loss and the Company’s income for that particular period.

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($ in thousands) 2024 2023 2022

2023 2022 2021

Stock compensation costs $ 45,535 $ 39,867 $ 37,601

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Time-Based RSUs Performance-Based RSUs

Shares Weighted-Average Grant Date Fair Value

Shares Weighted-Average Grant Date Fair Value Shares Weighted-Average Grant Date Fair Value

Outstanding, January 1, 2024

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Diluted EPS $ 8.33 $ 8.18 $ 7.92

For the years ended December 31, 2023, 2022 and 2021, approximately 283 thousand, 3 thousand and 6 thousand weighted-average shares of anti-dilutive RSUs, respectively, were excluded from the diluted EPS computation.

Approximately six thousand, 283 thousand and three thousand weighted-average shares of anti-dilutive RSUs were excluded from the diluted EPS computation for the years ended December 31, 2024, 2023 and 2022,respectively.

Stock Repurchase Program — In 2020, the Company’s Board of Directors authorized a stock repurchase program to buy back up to $ 500 million of the Company’s common stock.

In 2023, the Company repurchased 1,506,091 shares at an average price of $ 54.56 per share at a total cost of $ 82 million.

In 2022, the Company repurchased 1,385,517 shares at an average price of $ 72.17 per share at a total cost of $ 100 million.

The Company did no t repurchase any shares in 2021.

As of December 31, 2023, the Company had approximately $ 172 million available for repurchases under its stock repurchase program.

Note 15 — Accumulated Other Comprehensive Income (Loss)

The following table presents the activity under the Company’s common share repurchase program for the periods indicated:

Year Ended December 31,

($ in thousands, except shares and per share data) Shares Repurchased

Average Price per Share

2024 1,943,346 $ 74.33 $ 144,446

2023 1,506,091 $ 54.56 $ 82,174

2022 1,385,517 $ 72.17 $ 99,990

Note 15 — Accumulated Other Comprehensive (Loss) Income

The following table presents the changes in the components of AOCI balances for the years ended December 31, 2024, 2023 and 2022:

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Balance, December 31, 2021 $ ( 85,703 ) $ 257 $ ( 4,935 ) $ ( 90,381 )

Net unrealized (losses) gains arising during the period ( 136,846 ) 866 1,757 ( 134,223 )

Net unrealized losses arising during the period ( 620,870 ) ( 52,623 ) ( 16,348 ) ( 689,841 )

Amounts reclassified from AOCI 11,758 2,835 — 14,593

1 unchanged sentence

Balance, December 31, 2022 $ ( 694,815 ) $ ( 49,531 ) $ ( 21,283 ) $ ( 765,629 )

Net unrealized losses arising during the period ( 620,870 ) ( 52,623 ) ( 16,348 ) ( 689,841 )

Net unrealized gains (losses) arising during the period 76,930 ( 4,277 ) ( 56 ) 72,597

Amounts reclassified from AOCI 16,004 56,432 — 72,436

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The functional currency and reporting currency of the Company’s foreign subsidiary was RMB and USD, respectively.

The following table presents the components of other comprehensive income (loss), reclassifications to net income and the related tax effects for the years ended December 31, 2023, 2022 and 2021:

The following table presents the components of other comprehensive (loss) income, reclassifications to net income and the related tax effects for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,

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Reclassification adjustments:

Net realized losses (gains) on AFS debt securities reclassified into net income (1)

Net realized (gains) losses on AFS debt securities reclassified into net income (1)

( 2,069 ) 612 ( 1,457 ) 6,862 (2)

( 2,029 ) 4,833 ( 1,306 ) 386 ( 920 )

Amortization of unrealized losses on transferred securities (3)

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Cash flow hedges:

Net unrealized (losses) gains arising during the period ( 5,767 ) 1,490 ( 4,277 ) ( 74,069 ) 21,446 ( 52,623 ) 1,210 ( 344 ) 866

Net unrealized losses arising during the period ( 124,382 ) 36,935 ( 87,447 ) ( 5,767 ) 1,490 ( 4,277 ) ( 74,069 ) 21,446 ( 52,623 )

Net realized losses reclassified into net income (4)

2 unchanged sentences

Foreign currency translation adjustments, net of hedges:

Net unrealized gains (losses) arising during the period 698 ( 754 ) ( 56 ) ( 15,059 ) ( 1,289 ) ( 16,348 ) 463 1,294 1,757

Net unrealized (losses) gains arising during the period

( 809 ) ( 173 ) ( 982 ) 698 ( 754 ) ( 56 ) ( 15,059 ) ( 1,289 ) ( 16,348 )

Net change ( 809 ) ( 173 ) ( 982 ) 698 ( 754 ) ( 56 ) ( 15,059 ) ( 1,289 ) ( 16,348 )

Other comprehensive income (loss) $ 50,534 $ ( 15,198 ) $ 35,336 $ 206,712 $ ( 61,679 ) $ 145,033 $ ( 949,946 ) $ 274,698 $ ( 675,248 )

$ 206,712 $ ( 61,679 ) $ 145,033 $ ( 949,946 ) $ 274,698 $ ( 675,248 ) $ ( 193,420 ) $ 58,714 $ ( 134,706 )

(1) Pre-tax amounts were reported in Net (losses) gains on AFS debt securities on the Consolidated Statement of Income.

(1) Pre-tax amounts were reported in Net gains (losses) on AFS debt securities on the Consolidated Statement of Income.

(2) Represents the net loss related to an AFS debt security that was written-off in the first quarter of 2023 and subsequently sold during the fourth quarter of 2023.

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Note 16 — Regulatory Requirements and Matters

The Company and the Bank are subject to regulatory capital adequacy requirements administered by the respective federal banking agencies.

The Bank is a member bank of the Federal Reserve System and is primarily regulated by the Federal Reserve and the California Department of Financial Protection and Innovation.

The Company and the Bank are required to comply with the Basel III Capital Rules adopted by the federal banking agencies.

The Company and the Bank are subject to regulatory capital adequacy requirements administered by the respective federal banking agencies that are based largely under the Basel III Capital Rules.

As standardized approaches institutions, the Basel III Capital Rules require that banking organizations, such as the Company and the Bank, to maintain a minimum Common Equity Tier 1 (“CET1”) capital ratio of at least 4.5 %, a Tier 1 capital ratio of at least 6.0 %, a total capital ratio of at least 8.0 %, and a Tier 1 leverage ratio of a least 4.0 % to be considered adequately capitalized.

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Under the agencies’ Prompt Corrective Action regulations, failure of a bank to be well capitalized results in an escalating series of adverse regulatory consequences.

Effective January 1, 2020, the Company adopted the ASU 2016-13 Financial Instruments — Credit Losses (Topic 326) Measurement of Credit Losses on Financial instrument that introduced the CECL methodology .

In March 2020, the federal banking agencies issued the Interim Final Rule that provided banking organizations that adopted the CECL with the phase-in option to delay the estimated impact of CECL on regulatory capital.

The Bank and the Company have elected the CECL phase-in option in 2020 and delayed the impact of CECL on regulatory capital through 2021, after which the effects are being phased in over a three-year period from January 1, 2022 through December 31, 2024.

As of both December 31, 2024 and 2023, the Company and the Bank were both categorized as well capitalized based on applicable U.S.

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The following table presents the regulatory capital information of the Company and the Bank as of December 31, 2024 and 2023:

December 31, 2023 December 31, 2022

($ in thousands) Amount Ratio Amount Ratio Minimum Capital Ratios

Fully Phased-in Minimum Capital Ratios (2)

December 31, 2024 (1)

December 31, 2023 (1)

($ in thousands) Amount Ratio Amount Ratio Minimum Regulatory Requirements Minimum Regulatory Requirements including Capital Conservation Buffer (3)

Well-Capitalized Requirement

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East West Bank $ 7,367,996 13.4 % $ 6,732,946 12.6 % 4.5 % 7.0 % 6.5 %

Tier 1 leverage capital (to adjusted average assets)

Tier 1 leverage capital (to adjusted quarterly average assets)

$ 7,839,816 10.4 % $ 7,140,778 10.2 % 4.0 % 4.0 % N/A

East West Bank $ 7,367,996 9.8 % $ 6,732,946 9.6 % 4.0 % 4.0 % 5.0 %

Risk-weighted assets

Company $ 53,663,392 N/A $ 50,036,719 N/A N/A N/A N/A

East West Bank $ 53,539,980 N/A $ 50,024,772 N/A N/A N/A N/A

Adjusted quarterly average total assets

Company $ 70,406,008 N/A $ 65,221,597 N/A N/A N/A N/A

East West Bank $ 70,270,449 N/A $ 65,198,267 N/A N/A N/A N/A

N/A — Not applicable.

(1) Reflected a delay of the estimated impact of CECL on regulatory capital in accordance with regulatory capital rules.

(2) The well-capitalized requirements for CET1 capital and Tier 1 leverage capital apply only to the Bank since there is no CET1 capital ratio or Tier 1 leverage capital ratio component in the definition of a well-capitalized bank holding company.

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(2) Commercial Banking;

and (3) Other.

and (3) Treasury and Other.

These segments are defined by the type of customers served, and the related products and services provided.

The segments reflect how financial information is currently evaluated by management.

Operating segment results are based on the Company’s internal management reporting process, which reflects assignments and allocations of certain balance sheet and income statement items.

The information presented is not indicative of how the segments would perform if they operated as independent entities.

The CODM is the Chairman and Chief Executive Officer (“CEO”) of the Company.

The CODM regularly reviews the Company’s operating results to allocate resources and assess performance.

Operating segment results are also based on the Company’s internal management reporting process, which reflects the allocations of certain balance sheet and income statement line items.

The CODM uses certain performance measures such as segment net income and considers variances of actual results from forecast results on a quarterly basis when making decisions on resource allocations between segments.

The segment information presented is not indicative of how the segments would perform if they operated as independent entities.

The Consumer and Business Banking segment primarily provides financial products and services to consumer and commercial customers through the Company’s domestic branch network and digital banking platforms.

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It also originates commercial loans for small- and medium-sized enterprises through the Company’s branch network.

Other products and services provided by this segment include wealth management, treasury management, interest rate risk hedging and foreign exchange services.

The Commercial Banking segment primarily generates commercial loan and deposit products.

Commercial loan products include CRE lending, construction financing, commercial business lending, working capital lines of credit, trade finance, letters of credit, affordable housing lending, asset-based lending, asset-backed finance, project finance and equipment financing.

Other products and services provided by this segment include wealth management, private banking, treasury management, interest rate risk hedging and foreign exchange services.

The Commercial Banking segment primarily generates domestic commercial loan and deposit products.

Commercial loan products include CRE lending, construction finance, commercial business lending, working capital lines of credit, trade finance, letters of credit, affordable housing lending, asset-based lending, asset-backed finance, project finance and equipment financing.

Commercial deposit products and other financial services include treasury management, foreign exchange services and interest rate and commodity risk hedging.

The remaining centralized functions, including the corporate treasury activities of the Company and eliminations of inter-segment amounts, have been aggregated and included in the Other segment, which provides broad administrative support to the two core segments, namely the Consumer and Business Banking and the Commercial Banking segments.

The remaining centralized functions, including the corporate treasury activities of the Company, eliminations of inter-segment amounts, and centrally managed departments, have been aggregated and included in the Treasury and Other segment.

The Company utilizes an internal reporting process to measure the performance of the three operating segments within the Company.

The internal reporting process derives operating segment results by utilizing allocation methodologies for revenues and expenses.

Net interest income of each segment represents the difference between actual interest earned on assets and interest incurred on liabilities of the segment, adjusted for funding charges or credits through the Company’s internal funds transfer pricing (“FTP”) process.

Noninterest income and noninterest expense directly attributable to a business segment are assigned to that segment.

Indirect costs, including technology-related costs and corporate overhead, are allocated based on a segment’s estimated usage using factors including but not limited to, full-time equivalent employees, net interest income, and loan and deposit volume.

Charge-offs are recorded to the segment directly associated with the respective loans charged off, and provision for credit losses is recorded to the segments based on the related loans for which allowances are evaluated.

The Company’s internal reporting process utilizes a full-allocation methodology.

Under this methodology, corporate and indirect expenses incurred by the Other segment are allocated to the Consumer and Business Banking and the Commercial Banking segments, except certain corporate treasury-related expenses and insignificant unallocated expenses.

The corporate treasury function within the Other segment is responsible for the Company’s liquidity and interest rate management, and the internal FTP process.

The Company’s internal reporting process consists of certain allocation methodologies for revenues and expenses, and the internal funds transfer pricing (“FTP”) process.

The FTP process is formulated with the goal of encouraging loan and deposit growth that is consistent with the Company’s overall profitability objectives, as well as providing a reasonable and consistent basis for the measurement of its business segments’ net interest margins and profitability.

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FTP credits for deposits reflect the long-term value generated by the deposits.

The net spread between the total internal FTP charges and credits is recorded as part of net interest income in the Other segment.

The FTP process transfers the corporate interest rate risk exposure to the treasury function within the Other segment, where such exposures are centrally managed.

The net spread between the total internal FTP charges and credits is recorded as part of net interest income in the Treasury and Other segment.

The corporate treasury function within the Treasury and Other segment is responsible for the Company’s liquidity and interest rate management and manages the corporate interest rate risk exposure.

The Company’s internal FTP assumptions and methodologies are reviewed at least annually to ensure that the process is reflective of current market conditions.

Each segment’s net interest income represents the difference between actual interest earned on assets and interest incurred on liabilities of the segment, adjusted for funding charges or credits through the Company’s FTP process.

Noninterest income and noninterest expense directly attributable to a business segment are assigned to that segment.

Loan charge-offs and provision for credit losses are recorded to the segments, where the loans are recorded.

Significant corporate overhead expenses incurred by centralized support areas in the Treasury and Other segment are allocated to the Consumer and Business Banking and Commercial Banking segments based on the segment’s estimated usage factors including, but not limited to, full-time equivalent employees, net interest income, and loan and deposit volume.

Amortization of tax credit and CRA investments and certain types of administrative expenses are generally not allocated to segments.

During the third quarter of 2024, the Company refined its segment allocation methodology and reclassified certain deposits and their related income or expenses from the “Consumer and Business Banking” segment to the “Commercial Banking” or “Treasury and Other” segments, and certain loan balances and their related income or expenses from the “Commercial Banking” segment to the “Treasury and Other” segment.

Balances for the prior years have been reclassified for comparability.

The following tables present the operating results and other key financial measures for the individual operating segments as of and for the years ended December 31, 2024, 2023 and 2022:

($ in thousands) Consumer and Business Banking

Commercial Banking

($ in thousands) Consumer and Business Banking Commercial Banking Treasury and Other Total

Year Ended December 31, 2024

Net interest income before provision for credit losses $ 1,152,033 $ 1,125,931 $ 752 $ 2,278,716

$ 1,238,829 $ 992,519 $ 80,906 $ 2,312,254

Provision for credit losses 18,422 106,578 — 125,000

Noninterest income 108,773 197,780 28,665 335,218

Noninterest expense 477,622 382,865 162,261 1,022,748

Total revenue before provision for credit losses 1,260,806 1,323,711 29,417 2,613,934

Provision for (reversal of) credit losses

8,691 166,953 ( 1,644 ) 174,000

Compensation and employee benefits 217,612 234,240 98,882 550,734

Other noninterest expense (1)

234,494 161,969 10,876 407,339

Total noninterest expense 452,106 396,209 109,758 958,073

Segment income (loss) before income taxes 800,009 760,549 ( 78,697 ) 1,481,861

Segment net income $ 563,218 $ 535,652 $ 66,716 $ 1,165,586

Average balances:

Loans $ 18,966,662 $ 32,996,221 $ 405,897 $ 52,368,780

Deposits $ 30,815,912 $ 25,820,956 $ 3,036,171 $ 59,673,039

As of December 31, 2024

Segment assets $ 20,084,814 $ 35,646,939 $ 20,244,722 $ 75,976,475

($ in thousands) Consumer and Business Banking

Commercial Banking

($ in thousands) Consumer and Business Banking Commercial Banking Treasury and Other Total

Year Ended December 31, 2023

Net interest income (loss) before provision for credit losses $ 1,225,954 $ 1,116,013 $ ( 29,713 ) $ 2,312,254

Provision for credit losses 27,197 46,303 — 73,500

Noninterest income 103,890 168,502 22,872 295,264

Noninterest expense 397,882 314,185 147,326 859,393

Total revenue (loss) before provision for credit losses 1,329,844 1,284,515 ( 6,841 ) 2,607,518

Provision for credit losses 21,454 100,391 3,155 125,000

Compensation and employee benefits 203,387 217,663 87,488 508,538

Other noninterest expense (1)

262,086 158,949 93,175 514,210

Total noninterest expense 465,473 376,612 180,663 1,022,748

Segment income (loss) before income taxes 842,917 807,512 ( 190,659 ) 1,459,770

Segment net income $ 608,120 $ 507,467 $ 12,496 $ 1,128,083

Segment net income (loss) $ 594,965 $ 570,153 $ ( 3,957 ) $ 1,161,161

Average balances:

Loans $ 17,739,984 $ 31,365,547 $ 439,605 $ 49,545,136

Deposits $ 28,174,781 $ 23,304,066 $ 3,483,884 $ 54,962,731

As of December 31, 2023

Segment assets $ 19,165,172 $ 35,020,106 $ 15,427,606 $ 69,612,884

($ in thousands) Consumer and Business Banking

Commercial Banking

($ in thousands) Consumer and Business Banking Commercial Banking Treasury and Other Total

Year Ended December 31, 2022

Net interest income before reversal of provision for credit losses $ 697,101 $ 766,202 $ 68,268 $ 1,531,571

Reversal of provision for credit losses ( 4,998 ) ( 30,002 ) — ( 35,000 )

Net interest income (loss) before provision for credit losses $ 1,061,238 $ 988,158 $ ( 3,515 ) $ 2,045,881

Noninterest income 113,722 174,365 10,579 298,666

Noninterest expense 364,635 275,649 155,805 796,089

Total revenue before provision for credit losses 1,174,960 1,162,523 7,064 2,344,547

Provision for (reversal of) credit losses 25,983 48,248 ( 731 ) 73,500

Compensation and employee benefits 195,394 211,355 70,886 477,635

Other noninterest expense (1)

196,581 102,018 83,159 381,758

Total noninterest expense 391,975 313,373 154,045 859,393

Segment income (loss) before income taxes 757,002 800,902 ( 146,250 ) 1,411,654

Segment net income $ 537,754 $ 569,982 $ 20,347 $ 1,128,083

Average balances:

Loans $ 15,534,259 $ 29,321,701 $ 463,498 $ 45,319,458

Deposits $ 27,276,151 $ 23,252,073 $ 3,771,355 $ 54,299,579

As of December 31, 2022

Segment assets $ 17,183,425 $ 32,770,772 $ 14,157,953 $ 64,112,150

(1) The Treasury and Other segment's other noninterest expense is primarily comprised of amortization of tax credit and CRA investments, and other operating expenses.

The Consumer and Business Banking segment's other noninterest expense is primarily comprised of corporate overhead allocated expenses, occupancy and equipment expense, other operating expenses, and deposit insurance premiums and regulatory assessments.

The Commercial Banking segment’s other noninterest expense is primarily comprised of corporate overhead allocated expenses, deposit account expense, occupancy and equipment expense, and deposit insurance premiums and regulatory assessments.

Note 18 — Parent Company Condensed Financial Statements

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($ in thousands) 2024 2023

Cash and cash equivalents due from subsidiary bank $ 445,770 $ 228,531

Cash and cash equivalents due from banks

$ 394,919 $ 445,770

Investments in subsidiaries:

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Nonbank 10,423 13,502

Investments in tax credit investments, net — 1,925

Other assets 125,552 120,742

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Compensation and employee benefits 7,283 7,204 6,708

(Impairment recoveries) amortization of tax credit and other investments ( 2,901 ) ( 786 ) 425

Other expense 1,815 2,040 1,306

Other expense (income) (1)

1,839 ( 1,086 ) 1,254

Total expense 13,629 17,007 13,412

Income before income tax benefit and equity in undistributed income of subsidiaries

525,575 684,577 226,745

Income tax benefit 4,143 5,844 4,269

1 unchanged sentence

Net income $ 1,165,586 $ 1,161,161 $ 1,128,083

(1) Includes $ 3 million and $ 2 million in DC Solar recoveries for the years ended December 31, 2023 and 2022, respectively.

CONDENSED STATEMENT OF CASH FLOWS

6 unchanged sentences

Deferred income tax expense (benefit) 2,788 948 ( 2,193 )

948 ( 2,193 ) 2,721

Net change in other assets ( 6,912 ) ( 4,160 ) 4,250

1 unchanged sentence

Other operating activities, net 1,265 2,443 1,333

2,443 1,333 1,877

Net cash provided by operating activities 526,057 689,605 235,183

CASH FLOWS FROM INVESTING ACTIVITIES

Net increase in investments in tax credit investments — ( 1,612 ) ( 346 )

Distributions received from equity method investees 1,594 410 436

Redemption of trust preferred securities 3,558 — —

Other investing activities, net ( 494 ) ( 95,095 ) ( 7,390 )

( 96,689 ) ( 6,188 ) ( 1,476 )

Net cash used in investing activities

Net cash provided by (used in) investing activities

3,064 ( 95,095 ) ( 7,390 )

CASH FLOWS FROM FINANCING ACTIVITIES

Long-term debt:

Repayment of junior subordinated debt

( 116,558 ) — —

Common stock:

Proceeds from issuance pursuant to various stock compensation plans and agreements 3,023 3,208 3,178

3,208 3,178 2,573

Stock tendered for payment of withholding taxes ( 14,877 ) ( 23,751 ) ( 19,087 )

Repurchase of common stock pursuant to the stock repurchase program ( 143,082 ) ( 82,174 ) ( 99,990 )

( 82,174 ) ( 99,990 ) —

Cash dividends paid ( 308,478 ) ( 274,554 ) ( 228,381 )

Net cash used in financing activities ( 579,972 ) ( 377,271 ) ( 344,280 )

Net increase (decrease) in cash and cash equivalents 217,239 ( 116,487 ) ( 94,047 )

Net (decrease) increase in cash and cash equivalents

( 50,851 ) 217,239 ( 116,487 )

Cash and cash equivalents, beginning of year 445,770 228,531 345,018

1 unchanged sentence

Note 19 — Subsequent Events

Declaration of Dividend — On January 23, 2024, the Company’s Board of Directors declared first quarter 2024 cash dividends for the Company’s common stock.

Declaration of Dividend and Repurchase Authorization — On January 23, 2025, the Company’s Board of Directors declared first quarter 2025 cash dividends for the Company’s common stock.

The common stock cash dividend of $ 0.60 per share was paid on February 17, 2025 to stockholders of record as of February 3, 2025.

Redemption of Junior Subordinated Debt and Trust Preferred Securities Issued by East West Capital Trusts — In January 2024, the Company provided notice that it would redeem $ 113 million of the principal face value of junior subordinated debt and $ 4 million of the principal face value of trust preferred securities issued by the East West Capital Trusts.

Of these amounts, $ 16 million was redeemed in February 2024 and the remaining $ 101 million is scheduled to be redeemed in March 2024.

Increase in FDIC Special Assessment — In November 2023, the FDIC approved a final rule to implement a special deposit insurance assessment to recover losses to the DIF arising from the protection of uninsured depositors following the receiverships of failed institutions in the spring of 2023 .

The Company recorded a pre-tax $ 70 million special assessment charge based on the November 2023 final rule.

In February 2024, the FDIC estimated the losses attributable to the protection of uninsured depositors at Silicon Valley Bank and Signature Bank to increase approximately $ 4.1 billion from $ 16.3 billion, as described in the November 2023 final rule, to $ 20.4 billion.

As the loss estimates resulting from the failures of Silicon Valley Bank and Signature Bank may be further subject to change pending the projected and actual outcome of loss share agreements, joint ventures, and outstanding litigation, the exact amount of losses incurred will be determined when the FDIC terminates the receiverships.

As of the date of this filing, the Bank cannot reasonably estimate whether the FDIC’s increased estimate of losses attributable to the protection of uninsured depositors will result in an increase in or modifications to the Bank’s special assessment charge.

The FDIC plans to provide depository institutions that are subject to the special assessment with an updated estimate of each institution’s quarterly and total special assessment expense with its first quarter 2024 special assessment invoice in June 2024.

In addition, on January 22, 2025, East West’s Board of Directors authorized the repurchase of up to an additional $ 300 million of East West stock.

Southern California Wildfires — In January 2025, several wildfires affected Los Angeles and its surrounding areas.

Based on the Company’s assessment of available information regarding its loan portfolio and related collateral within the affected areas, the Company has determined that the impact to its consolidated financial statements is immaterial through the date of filing of this Form 10-K.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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 8. Financial Statements and Supplementary Data