Earnings Review and Free Research Report: Cathay General Q2 Net Income Surged 47.6% Y-o-Y

Research Desk Line-up: PacWest Bancorp Post Earnings Coverage

LONDON, UK / ACCESSWIRE / July 25, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Cathay General Bancorp (NASDAQ: CATY), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=CATY, following the Company’s reporting of its financial results on July 19, 2017, for the second quarter fiscal 2017 (Q2 FY17). Los Angeles, California-based Company’s net income rose 47.6% y-o-y. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member’s account at:

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Get more of our free earnings reports coverage from other constituents of the Regional – Pacific Banks industry. Pro-TD has currently selected PacWest Bancorp (NASDAQ: PACW) for due-diligence and potential coverage as the Company announced on July 18, 2017, its financial results for Q2 2017. Register for a free membership today, and be among the early birds that get access to our report on PacWest Bancorp when we publish it.

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on CATY; also brushing on PACW. With the links below you can directly download the report of your stock of interest-free of charge at:

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Earnings Reviewed

During the quarter ended June 30, 2017, Cathay General’s net interest income before provision for credit losses rose 15.3% to $117.35 million from $101.78 million in Q2 FY16. The growth in net interest income is primarily attributable to an increase in interest income from loans and a decrease in interest expense from securities sold under agreements to repurchase. The Company’s non-interest income declined 32.1% to $6.15 million in Q2 FY17 from $9.06 million in the year ago same quarter. The Company had reported securities gains of $1.7 million in Q2 FY16. Additionally, the non-interest expenses were down by 17.7% in Q2 FY17 to $56.66 million from $68.88 million in Q2 FY16.

The holding Company for Cathay Bank reported a record net income of $51.42 million, or $0.64 per diluted common share, in Q2 FY17 versus $34.83 million, or $0.44 per diluted common share, in Q2 FY16. Meanwhile, Wall Street had expected the Company to report net income of $0.61 per diluted share.

Earnings Metrics

During the reported quarter, the Company’s return on average assets was 1.48% versus 1.07% in the prior year’s comparable quarter. The return on average common stockholders’ equity came in at 10.96% in Q2 FY17 compared to 8.00% reported in the year ago same period. Furthermore, the bank’s efficiency ratio was 45.88% during Q2 FY17 compared to 62.15% in Q2 FY16.

Net interest margin for the reported quarter increased to 3.63% from 3.38% in Q2 FY16. The bank’s yield on total earning assets improved during Q2 FY17 to 4.19% from 4.05% in the year ago comparable period. In Q2 FY17, average total earning assets increased to $12.97 billion from $12.11 billion in the previous year’s corresponding quarter.

The Company’s allowance for loan losses was $115.81 million, or 1.00% of gross loans, at June 30, 2017, compared to $122.95 million, or 1.17% of gross loans, as on June 30, 2016.

Balance Sheet Analyzed

Cathay General’s gross loan balance increased to $11.57 billion during the quarter ended June 30, 2017, from $10.52 billion in Q2 FY16. Total average interest-bearing deposits were $9.08 billion as on June 30, 2017, compared to $8.37 billion recorded as on June 30, 2016. Furthermore, the bank had total assets worth $14.34 billion as on June 30, 2017, up from $13.49 billion as on June 30, 2016.

As on June 30, 2017, the Banks’s nonperforming assets to total assets was 0.6% compared to 0.5% as on December 31, 2016. Furthermore, total charge-offs during Q2 FY17 was $0.53 million versus $7.63 million in the quarter ended June 30, 2016.

As on June 30, 2017, the Company’s common equity Tier 1 capital ratio of 13.26% versus 12.73% as on June 30, 2016. The Company’s tier 1 risk based capital ratio of 14.27% as on June 30, 2017, compared to 13.79% as on June 30, 2016. Total risk-based capital ratio was15.35% at the end of reported quarter versus 14.97% at the close of the last year’s comparable quarter. Furthermore, Tier 1 leverage capital ratio was 12.08% as on June 30, 2017, compared to 11.80% on June 30, 2016.

Acquisition

On July 14, 2017, the Company announced the completion its previously-announced acquisition of SinoPac Bancorp, parent Company of Far East National Bank (FENB). FENB currently has nine branches in California and a representative office in Beijing.

Under the stock purchase agreement, the total consideration was approximately $351.6 million plus additional post closing payments based on the realization of certain assets of FENB. In consideration, the Company had issued 926,192 shares of its common stock as consideration and the remainder of the consideration is payable in cash.

Stock Performance

At the closing bell, on Monday, July 24, 2017, Cathay General Bancorp’s stock rose slightly by 0.34%, ending the trading session at $38.33. A total volume of 313.18 thousand shares has exchanged hands. The Company’s stock price surged 3.04% in the last one month, 5.80% in the past six months, and 26.42% in the previous twelve months. Moreover, the stock gained 0.79% since the start of the year. The stock is trading at a PE ratio of 15.81 and has a dividend yield of 2.19%. The stock currently has a market cap of $3.07 billion.

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