Cathay General Bancorp (CATY) Q3 2023 Earnings: Net Income Drops to $82.4 Million
Cathay General Bancorp (NASDAQ:CATY) reports Q3 2023 net income of $82.4 million, down from $93.2 million in Q2 2023.
Total deposits increased by $538.6 million, or 11.6% annualized, to $19.6 billion in Q3 2023.
Total gross loans increased by $71.0 million, or 1.6% annualized, to $19.0 billion in Q3 2023.
Diluted earnings per share decreased to $1.13 for Q3 2023 compared to $1.28 for Q2 2023.
On October 23, 2023, Cathay General Bancorp (NASDAQ:CATY) announced its unaudited financial results for the third quarter of 2023. The company reported a net income of $82.4 million, or $1.13 per share, marking a decrease from the previous quarter's net income of $93.2 million.
Financial Performance
The company's financial performance for the third quarter of 2023 showed a decrease in net income and diluted earnings per share compared to the second quarter of 2023. The net income for the quarter ended September 30, 2023, was $82.4 million, a decrease of $10.8 million, or 11.6%, compared to the net income of $93.2 million for the second quarter of 2023. Diluted earnings per share for the third quarter of 2023 was $1.13 per share compared to $1.28 per share for the second quarter of 2023.
For the third quarter of 2023, our total deposits increased by $538.6 million or 11.6% annualized to $19.6 billion. Our net interest margin declined slightly from 3.44% in the second quarter to 3.38% in the third quarter, commented Chang M. Liu, President and Chief Executive Officer of the Company.
Income Statement Review
The company's net interest income before provision for credit losses increased $4.1 million, or 2.3%, to $185.6 million during the third quarter of 2023, compared to $181.5 million in the second quarter of 2023. The increase was due primarily to an increase in interest income from loans and securities, partially offset by an increase in deposit interest expense.
Balance Sheet Review
As of September 30, 2023, the company's gross loans were $19.02 billion, an increase of $71.0 million, or 0.4%, from $18.95 billion as of June 30, 2023. Total deposits were $19.64 billion as of September 30, 2023, an increase of $538.6 million, or 2.8%, from $19.10 billion as of June 30, 2023.
Asset Quality Review
As of September 30, 2023, total non-accrual loans were $77.3 million, an increase of $8.3 million, or 12.0%, from $69.0 million as of June 30, 2023. The allowance for loan losses was $154.6 million and the allowance for off-balance sheet unfunded credit commitments was $11.4 million as of September 30, 2023.
Capital Adequacy Review
As of September 30, 2023, the Companys Tier 1 risk-based capital ratio of 12.70%, total risk-based capital ratio of 14.21%, and Tier 1 leverage capital ratio of 10.44%, calculated under the Basel III capital rules, continue to place the Company in the well capitalized category for regulatory purposes.
The company will host a conference call to discuss its third quarter 2023 financial results on Monday, October 23, 2023, at 3:00 p.m., Pacific Time.
This article first appeared on GuruFocus.
