Third quarter 2026
Filed Oct 20, 2026EAST WEST BANCORP REPORTS RECORD QUARTERLY NET INCOME OF $382 MILLION AND RECORD QUARTERLY DILUTED EARNINGS PER SHARE OF $2.76 ON RECORD TOTAL REVENUE
Record total revenue, pre-tax pre-provision income, net income and diluted EPS were accompanied by quarterly and year-over-year loan and deposit growth, a higher net interest margin versus the prior quarter, and lower operating noninterest expense. Credit provisioning and nonperforming assets increased sequentially, while book value declined because of available-for-sale debt securities net of tax.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Q3 2026 total revenuenon-GAAP | $822.7M | 4.0% | 5.7% |
| Q3 2026 net interest income before provision for credit lossesGAAP | $718.9M | 5.0% | 6.1% |
| Q3 2026 total noninterest incomeGAAP | $103.9M | (2.5)% | 3.3% |
| Q3 2026 total fee incomeGAAP | $93.48M | (2.5)% | 2.2% |
| Q3 2026 commercial and consumer deposit-related feesGAAP | $32.60M | 3.1% | 14.8% |
| Q3 2026 lending and loan servicing feesGAAP | $25.79M | (7.8)% | (6.6)% |
| Q3 2026 foreign exchange incomeGAAP | $17.80M | 19.2% | 22.8% |
| Q3 2026 wealth management feesGAAP | $15.54M | (20.1)% | 6.7% |
| Q3 2026 customer derivative incomeGAAP | $1.75M | (7.7)% | (72.9)% |
| Q3 2026 derivative mark-to-market and credit valuation adjustmentsGAAP | $6.33M | NM | NM |
| Q3 2026 net gains on AFS debt securitiesGAAP | $290K | (90.1)% | 408.8% |
| Q3 2026 other investment income (loss)GAAP | $1.70M | NM | 141.0% |
| Q3 2026 other incomeGAAP | $2.06M | (75.7)% | (76.0)% |
| Q3 2026 total noninterest expenseGAAP | $283.0M | (2.6)% | 2.2% |
| Q3 2026 total operating noninterest expenseGAAP | $259.3M | (3.2)% | (0.7)% |
| Q3 2026 amortization of tax credit and CRA investmentsGAAP | $23.73M | 4.1% | 51.2% |
| Q3 2026 income before income taxesGAAP | $494.7M | 5.8% | 6.4% |
| Q3 2026 income tax expenseGAAP | $112.5M | 8.4% | 16.3% |
| Q3 2026 effective tax rateGAAP | 22.74 % | 53 bps | 194 bps |
| Q3 2026 net incomeGAAP | $382.2M | 5.1% | 3.7% |
| Q3 2026 basic EPSGAAP | $2.78 | 5.1% | 3.9% |
| Q3 2026 diluted EPSGAAP | $2.76 | 4.8% | 4.0% |
| Q3 2026 pre-tax, pre-provision incomenon-GAAP | $539.7M | 7.8% | 7.7% |
| Q3 2026 net interest marginGAAP | 3.49 % | 6 bps | (4) bps |
| Q3 2026 efficiency ratioGAAP | 34.40 % | (233) bps | (119) bps |
| Q3 2026 return on average assetsGAAP | 1.79 % | 4 bps | (5) bps |
| Q3 2026 return on average common equityGAAP | 16.30 % | 29 bps | (114) bps |
| Q3 2026 return on average tangible common equitynon-GAAP | 17.17 % | 29 bps | (131) bps |
| Q3 2026 provision for credit lossesGAAP | $45M | 36.4% | 25.0% |
| Q3 2026 net charge-offsGAAP | $22M | – | – |
| Q3 2026 annualized quarterly net charge-offs to average loans HFIother | 0.15 % | – | – |
| September 30, 2026 total assetsGAAP | $86.01B | 1.5% | 8.0% |
| September 30, 2026 depositsGAAP | $71.49B | 2.0% | 7.4% |
| September 30, 2026 total loans HFIGAAP | $59.71B | 1.3% | 7.1% |
| September 30, 2026 total loansGAAP | $59.73B | 1.3% | 7.1% |
| September 30, 2026 allowance for loan and lease lossesGAAP | $864.6M | 2.7% | 9.4% |
| September 30, 2026 nonperforming assetsGAAP | $256.1M | – | – |
| September 30, 2026 stockholders’ equityGAAP | $9.04B | (2.2)% | 5.3% |
| September 30, 2026 book value per shareGAAP | $65.97 | (2.2)% | 5.7% |
| September 30, 2026 tangible book value per sharenon-GAAP | $62.55 | (2.4)% | 6.1% |
| September 30, 2026 total stockholders’ equity to assets ratioGAAP | 10.51 % | (40) bps | (26) bps |
| September 30, 2026 tangible common equity rationon-GAAP | 10.02 % | (39) bps | (22) bps |
| Nine months ended September 30, 2026 total revenuenon-GAAP | $2.39B | – | 9.8% |
| Nine months ended September 30, 2026 net incomeGAAP | $1.10B | – | 13.9% |
| Nine months ended September 30, 2026 diluted EPSGAAP | $7.97 | – | 14.4% |
| Nine months ended September 30, 2026 total provision for credit lossesGAAP | $114,000 | – | (12.3)% |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Commercial and industrial loansLoans held-for-investment balance as of September 30, 2026. | $19,786,324 | (0.4) % | 9.9 % |
| Total commercial real estate loansLoans held-for-investment balance as of September 30, 2026. | $22,094,897 | 2.0 % | 5.0 % |
| Total residential mortgage loansLoans held-for-investment balance as of September 30, 2026. | $17,767,023 | 2.3 % | 6.6 % |
| Noninterest-bearing demand depositsDeposit product balance as of September 30, 2026. | $18,539,391 | 1.0 % | 14.9 % |
| Money market depositsDeposit product balance as of September 30, 2026. | $16,934,855 | 4.2 % | 8.5 % |
| Time depositsDeposit product balance as of September 30, 2026. | $25,852,416 | 1.2 % | 2.2 % |
Capital returns
- The common stock cash dividend of $0.80 per share is payable on November 17th, 2026 to shareholders of record as of November 2nd, 2026.
- East West did not repurchase any shares of common stock during the third quarter of 2026.
- $117 million of East West’s share repurchase authorization remains available.
What drove it
- Record quarterly net interest income of $718,896 increased 5.0% quarter-over-quarter and 6.1% year-over-year.
- Net interest margin was 3.49 %, up 6 basis points quarter-over-quarter.
- Average interest-earning assets increased 2.2% quarter-over-quarter to $81,830,917, including a $1.0 billion increase in average securities and a $0.7 billion increase in average total loans outstanding.
- Average total deposits increased 2.3% quarter-over-quarter to $70,291,734, led by growth in average noninterest-bearing demand, money market, interest-bearing checking, and time deposits.
- Commercial and consumer deposit-related fees and foreign exchange income rose quarter-over-quarter, reflecting higher customer activity.
- Total operating noninterest expense declined 3.2% quarter-over-quarter, led by lower other operating expense, compensation and employee benefits expense, and OREO expense.
Concerns
- Provision for credit losses increased to $45,000 from $33,000 in the prior quarter.
- Nonperforming assets increased to $256,142 from $246,959 in the prior quarter, primarily driven by an increase in OREO.
- Criticized loans increased to $1,353,608 from $1,287,724 in the prior quarter.
- Noninterest income declined 2.5% quarter-over-quarter, including lower wealth management fees, lending and loan servicing fees, and other income.
- Book value per share declined to $65.97 from $67.48 and tangible book value per share declined to $62.55 from $64.06, primarily reflecting changes in the value of AFS debt securities net of tax.
- Net interest margin of 3.49 % was 4 basis points below 3.53 % in the third quarter of 2025.
What to watch
- Progression of provision for credit losses, the allowance for loan losses, criticized loans and nonperforming assets.
- Whether record deposit growth, including 14.9 % year-over-year growth in noninterest-bearing demand deposits, continues.
- Net interest margin following the third-quarter 6 basis-point sequential increase.
- Trends in fee income, particularly wealth management fees and lending and loan servicing fees.
- The value of AFS debt securities net of tax and its effect on book value and tangible book value.
- Use of the remaining $117 million share repurchase authorization.
Balance sheet and cash flow
- Total assets were $86.0 billion as of September 30, 2026, an increase of $1.2 billion, or 1%, from $84.8 billion as of June 30, 2026.
- Total loans reached a record $59.7 billion as of September 30, 2026, an increase of $0.7 billion, or 1%, from $59.0 billion as of June 30, 2026.
- Total deposits reached a record $71.5 billion as of September 30, 2026, an increase of $1.4 billion, or 2%, from $70.1 billion as of June 30, 2026.
- Cash and cash equivalents, and deposits with banks were $4,647,504 as of September 30, 2026.
- FHLB advances were $3,000,000 as of September 30, 2026.
- Long-term debt and finance lease liabilities were $35,380 as of September 30, 2026.
- The loan-to-deposit ratio was 83.54 % as of September 30, 2026.
Analysis
East West reported a record third quarter, with total revenue of $822,749, pre-tax, pre-provision income of $539,706, net income of $382,196 and diluted EPS of $2.76. Revenue increased 4.0% from the prior quarter and 5.7% from the third quarter of 2025. Net income increased 5.1% sequentially and 3.7% year-over-year, while diluted EPS increased 4.8% sequentially and 4.0% year-over-year. The nine-month results also showed growth, with total revenue of $2,387,641, net income of $1,103,692 and diluted EPS of $7.97.
Net interest income was the principal revenue driver. It rose to $718,896, up 5.0% from the prior quarter and 6.1% from the prior year, while net interest margin increased to 3.49 % from 3.43 % in the prior quarter. Average interest-earning assets increased to $81,830,917, and average total loans increased to $58,906,728. Period-end total loans reached $59,728,142 and deposits reached $71,492,639. Noninterest-bearing demand deposits grew 14.9 % year-over-year to $18,539,391 and represented 26% of total deposits.
Noninterest income was $103,853, down 2.5% sequentially despite higher foreign exchange income and commercial and consumer deposit-related fees. The quarter included a $6,325 gain from derivative mark-to-market and credit valuation adjustments, compared with a $(732) loss in the prior quarter. Total operating noninterest expense fell 3.2% sequentially to $259,312, supporting an efficiency ratio of 34.40 % versus 36.73 % in the prior quarter. Total noninterest expense increased 2.2% from the prior year, with amortization of tax credit and CRA investments increasing 51.2%.
Credit costs increased sequentially. Provision for credit losses was $45,000 compared with $33,000 in the second quarter, and the allowance for loan and lease losses increased to $864,631, or 1.45 % of loans HFI. Net charge-offs declined to $22 million from $27 million. Nonperforming assets increased to $256,142 from $246,959, driven primarily by higher OREO, while criticized loans rose to $1,353,608 from $1,287,724. These credit measures are the principal counterweight to the record earnings performance.
Capital remained above the reported well-capitalized requirements, with a CET1 capital ratio of 15.41 %, a total capital ratio of 16.72 %, and a leverage ratio of 11.11 %. Stockholders’ equity declined to $9,039,762, and book value per share declined to $65.97 from $67.48, primarily reflecting changes in the value of AFS debt securities net of tax. The company declared a $0.80 per share fourth-quarter dividend, did not repurchase shares during the quarter, and retained $117 million under its repurchase authorization. The filing did not provide forward financial guidance.
Management, verbatim
I am pleased to report another record-breaking quarter for East West. Revenue, net interest income, pre-tax pre-provision income (“PTPP”), net income, and diluted earnings per share all set new records. Deposits and loans also finished the quarter at record levels, with noninterest-bearing demand deposits increasing nearly 15% year-over-year. This deposit growth underscores the success of our small business checking strategy and reflects our ability to build broader, more valuable relationships with our customers.
Dominic Ng, Chairman and Chief Executive Officer
Fee income remained strong, increasing 11% year-over-year during the first nine months of 2026, supported by solid third-quarter growth in commercial deposit account fees. Our disciplined approach to credit and expense management continued to bear fruit this quarter. Asset quality remained resilient, and given continued uncertainty in the economic outlook, we further bolstered our allowance for loan losses.
Dominic Ng, Chairman and Chief Executive Officer
Not in the filing
stated, not guessed- Forward guidance was not provided.
- Previous-release outlook was not provided.
- Gross margin was not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Revenue by operating segment was not reported. The segments listed are loan and deposit categories rather than reported revenue segments.
- Q3 2026 GAAP gross profit and operating income were not reported because these are not presented as banking line items.
- Q3 2026 non-GAAP EPS was not reported as a separate non-GAAP measure. Adjusted diluted EPS was $2.76, but it is presented as an adjusted reconciliation measure rather than labeled non-GAAP EPS.
- Year-over-year percentage changes for net charge-offs, nonperforming assets and criticized loans were not printed on their respective rows.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.