Overview

• U.S. regional bank's Q2 net income and EPS rose from prior quarter

• Net interest margin increased to 3.48% in Q2 from 3.43% in Q1

• Board approved increase in share repurchase authorization and partial redemption of trust preferred securities

Outlook

• Company did not provide specific financial guidance for the current or future periods

Result Drivers

• NET INTEREST INCOME - Higher net interest income, driven by increased interest income from loans and securities and lower deposit interest expense, boosted results

• LOAN AND DEPOSIT GROWTH - Loan growth was led by commercial and commercial real estate loans, while deposit growth was driven by non-interest-bearing and NOW deposits

• NON-INTEREST INCOME - Non-interest income rose, mainly due to a reduction in losses from investment securities repositioning and higher wealth management fees, partially offset by lower unrealized gains from equity securities

Company press release: ID:nBw5TQFmva

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q2 EPS		$1.37
Q2 Net Income		$92.20 mln
Q2 Net Interest Margin (%)		3.48%

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy"

• Wall Street's median 12-month price target for Cathay General Bancorp is $56.00, about 9.8% below its July 21 closing price of $62.06

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 9 three months ago

Reuters Recommended Reads

• July 21 - Hanmi Financial Q2 net income rises on deposit growth, lower credit loss

• July 21 - East West Bancorp Q2 revenue beats, EPS up

• July 21 - Century Next Financial Q2 net income rises on net interest margin expansion

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