East West Bancorp Reports Another Quarter of Record EPS; Continued Gains in Net Interest Margin and Efficiency Ratio Drive 46% Increase in EPS.

Business Editors

SAN MARINO, Calif.--(BUSINESS WIRE)--April 13, 2000

Cash EPS Climbs 58% Year Over Year and 14% from 4th Quarter 1999

ROE Climbs to 23%, 44% Above Prior Year

Management Anticipates Another Record Year of Earnings in 2000

East West Bancorp, Inc. (Nasdaq:EWBC), parent company of East West Bank, one of the nation's best performing community banks and a leading financial institution focused on the Chinese-American and other niche markets, today announced record financial results for the first quarter of 2000. Contributing to another quarter of record earnings were continued increases in the net interest margin, efficiency ratio and strong asset growth.

Highlights for the quarter included:

-- Net interest income rose 35% while the net interest margin

climbed to 4.01% due to strong growth in loans and only a

modest rise in the cost of funds;

-- 43% increase in average loans outstanding to $1.6 billion,

including 30% organic growth, compared to the first quarter of

1999;

-- Issuance of $10.8 million of trust preferred securities to fund

future growth;

-- Closing of the American International Bank ("AIB") acquisition;

-- Average total deposits grew 28% to $1.7 billion, reflecting a

79% increase in average non-interest bearing deposits, compared

to the first quarter of 1999;

-- Efficiency ratio of 38%, with additional savings expected from

continued integration of AIB.

Net income for the quarter ended March 31, 2000 rose by 45% to a record $8.7 million, with diluted earnings per share increasing 46% over the prior year to $0.38. Cash earnings, which exclude the amortization of intangible items, were $9.2 million, or $0.41, 58% greater than in the first quarter of 1999 and 14% above the $0.36 cash EPS reported for the fourth quarter of 1999. Return on average assets for the first quarter was 1.50%, while return on average equity was 23.08%, compared to 1.19% and 15.98% for the prior year period, respectively.

Dominic Ng, Chairman, President and Chief Executive Officer, stated, "The record financial results for the first quarter not only demonstrate the success of our growth strategy and operational strength, but also serve as an indication of our ability to generate yet another record year of performance. Through increased penetration of our core corporate middle market, we achieved both strong organic loan growth and further portfolio diversification. As a result of both our internal efforts and benefits accrued through our acquisitions, we generated increases in our core deposits that provided a more balanced deposit mix and restrained the growth in our cost of funds. Combined, these two successes helped East West attain our net interest margin goal of 4.00%, even in the face of a rising interest rate environment, while maintaining our exceptional efficiency and asset quality ratios. In addition, we successfully completed the acquisition of American International Bank, achieving meaningful cost reductions and increasing our liquidity through the addition of substantial amounts of low cost core deposits. Late in the quarter, we completed the private issuance of nearly $11 million of trust preferred securities to provide capital support for future expansion. In addition, we also hired a number of new senior managers that added several new key capabilities. In all, the achievements and actions completed during the first quarter confirm the success of our strategy to serve as California's financial bridge and position us well for continued success throughout the remainder of the year."

Operating Results

East West generated $8.7 million in net income for the first quarter, a 45% increase over the amount reported for the first quarter of 1999. Net income, excluding the amortization of intangibles, grew by 50% to $9.2 million. Net income per diluted share climbed to $0.38, 46% greater than the $0.26 reported in the prior year period. Cash income per diluted share rose by 58% to $0.41. Strong gains in the commercial loan portfolio, continued improvements in the net interest margin and increased efficiencies contributed to the growth in net income.

Building upon the success of the bank's strategic plan, the first quarter witnessed healthy growth in total assets, loans and deposits. Total average assets for the quarter rose by 15% to $2.3 billion, resulting from a mix of internal growth and through the acquisitions of AIB and First Central Bank ("FCB"). Total average loans climbed 43% over the prior year quarter, with the acquisitions of AIB and FCB contributing $146 million, or 13%, to the growth in average loans. The yield on earning assets during the first quarter rose to 8.08%, 13% greater than in the first quarter of 1999, due primarily to the increase in the proportion of loans to earning assets and to a general increase in the bank's lending rates. Ng commented on the growth in the loan portfolio: "During the first quarter, we continued to originate a diverse mix of commercial real estate and commercial operating loans to increase the range of borrowers."

Total average deposits grew by 28% during the first quarter, reaching $1.7 billion, a result of both internal growth and the AIB and FCB acquisitions. Non-interest bearing deposits increased by 79% over the first quarter of 1999, reflecting $78 million in growth from the first quarter of 1999 and a $43 million increase from the fourth quarter of 1999. Deposits acquired from AIB and FCB contributed $237 million, or 18%, to the increase in average total deposits during the first quarter of 2000. The total average cost of deposits for the first quarter rose to 3.64%, compared to 3.55% for the prior year quarter. This modest increase in the average cost of deposits reflects the strength of the company's customer relationships.

Due to the combination of loan growth, increased yields on earning assets and moderate growth in the cost of funds, the bank reached its targeted goal for net interest margin during the quarter, generating a 4.01% margin and $22.0 million of net interest income. This represents increases of 20% and 35% over the first quarter of 1999, respectively. Ng commented that East West was especially pleased to reach this goal in the first quarter of the year, in light of the recent increase in the interest rate environment. "East West has worked diligently to create both a solid and stable core deposit franchise as well as profitable lending niches. We believe that the increase in our net interest margin during the past several quarters, in a range of interest rate environments, demonstrates the success of those efforts. While we believe that additional gains are available from our operations, we do not anticipate future increases in the net interest margin to be as high as they have been in the past."

East West recorded a $1.4 million provision for loan loss during the quarter, compared to $1.2 million in 1999. While the asset quality and loss ratios for the bank remain solid, management continues to increase the loss allowance to compensate for the overall growth in the loan portfolio and the continued shift in the composition of the loan portfolio toward commercial loan products.

Non-interest income grew to $4.4 million during the first quarter, a 32% increase from the prior year quarter. Higher branch fees, primarily the result of the bank's recent acquisition activities, contributed $0.5 million of the growth, while gains from the sale of affordable housing partnerships of $0.5 million and a $0.1 million increase in letter of credit fees accounted for the remainder of the growth.

Total non-interest expense for the quarter rose to $11.7 million, 33% above the level for the first quarter of 1999. Higher net occupancy and other operating costs contributed $1.7 million to the increase, while greater amortization of intangible assets and investments in affordable housing partnerships contributed $1.0 million. East West continues to operate as one of the most efficient financial institutions in the nation, reporting a 38.02% efficiency ratio, excluding the amortization of intangible assets and investments in affordable housing partnerships. The improved efficiency ratio reflects the higher net interest margin achieved from the shift in earning assets, flat employee compensation and leverage achieved in the bank's extensive operating infrastructure. Ng noted that senior management was particularly pleased with the efficiency ratio given the continued integration of AIB, which historically reported efficiencies in the 90% range. Management continues to set a long-term efficiency ratio target of 40%.

Asset Quality

Total non-performing assets as of March 31, 2000 equaled $15.4 million, or 0.67% of total assets, compared to $13.7 million, or 0.69% of total assets as of March 31, 1999. Nonaccrual loans at the quarter end totaled $10.4 million, or 0.63% of total loans, compared to $4.0 million, or 0.34% of total loans, as of March 31, 1999. The allowance for losses increased to $24.0 million at the end of the first quarter, compared to $17.6 million as of March 31, 1999. The allowance represents 1.45% of total loans and 230.3% of nonaccrual loans. The bank believes that the combination of strong reserve coverage, sound underwriting standards and the financial health of its customer base are the primary contributors to its solid asset quality.

Capitalization 

The bank remained "well capitalized" under every regulatory category, with a total risk based capital ratio of 10.04%, a Tier 1 risk based capital ratio of 8.78%, and a Tier 1 leverage ratio of 6.83%. In order to provide ample capital for anticipated growth, East West issued $10.8 million of trust preferred securities in a private placement during the quarter, with a 10.875% coupon. Ng commented on the capital raising: "Management at East West is continually monitoring the capital markets in order to prudently finance our growth and maximize shareholder value. During the quarter, we negotiated the opportunity to raise a level of capital that we believed could be effectively utilized in the next several quarters at a rate that proved much more accretive to our shareholders than the issuance of common stock. While we anticipate that our current capital level, combined with internally generated capital, is sufficient to fund our growth, we remain committed to maximizing the value of our shareholders through the issuance of capital at attractive prices."

Acquisitions

The Bank completed the acquisition of AIB on January 14, 2000. The Bank anticipates to complete the integration of AIB's operations in August 2000. The acquisition of AIB strengthened East West Bank's deposit franchise among the Chinese-American community and provided additional liquidity and lending opportunities through AIB's low cost deposit base. Management continues to evaluate a number of acquisition candidates, but anticipates a lower level of acquisition activity during 2000. As in the past, all acquisitions are expected to be accretive to earnings and returns in the first year of consolidated operations.

Forward Looking Statements

This release may contain forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and accordingly, the cautionary statements contained in East West Bancorp's Annual Report on form 10-K for the year ended December 31, 1999 (See Item I -- Business, and Item 6 -- Management's Discussion and Analysis of Plan of Operation), and other filings with the Securities and Exchange Commission are incorporated herein by reference. These factors include, but are not limited to: the effect of interest rate and currency exchange fluctuations; competition in the financial services market for both deposits and loans; EWBC's ability to efficiently incorporate acquisitions into its operations; the ability of EWBC and its subsidiaries to increase its customer base; and regional and general economic conditions. Actual results and performance in future periods may be materially different from any future results or performance suggested by the forward-looking statements in this release. Such forward-looking statements speak only as of the date of this release. East West expressly disclaims any obligation to update or revise any forward-looking statements found herein to reflect any changes in the Bank's expectations of results or any change in events.

For more information on East West Bancorp (via fax and at no cost), call 800/PRO-INFO and dial client code "EWBC." If calling from outside the United States, dial 732/544-2850. The company's Web site can be reached at www.eastwestbank.com.

                        EAST WEST BANCORP, INC.
                 CONDENSED CONSOLIDATED BALANCE SHEETS
                              (unaudited)
               (In thousands, except per share amounts)

                                    March 31,    December 31,
                                      2000          1999      % Change

Assets
Cash and cash equivalents         $   44,922    $   43,497        3
Investment securities                480,647       496,426       (3)
Loans (net of allowance for loan
 losses of $24,012 and $20,844)    1,634,967     1,486,641       10
Other assets                         157,867       126,066       25
Total assets                      $2,318,403    $2,152,630        8
Liabilities and Stockholders'
 Equity
Deposits                          $1,763,108    $1,500,529       17
Short-term borrowings                 36,000           600    5,900
FHLB advances                        328,000       482,000      (32)
Accrued expenses and other
 liabilities                          22,122        17,393       27
Junior subordinated debt
 securities                           10,750            --      n/a
  Total liabilities                2,159,980     2,000,522        8
Negative intangibles                   1,924         2,028       (5)
Stockholders' equity                 156,499       150,080        4
Total liabilities and
 stockholders' equity             $2,318,403    $2,152,630        8
Book value per share              $     6.98    $     6.69        4
Number of shares at period end(a)     22,422        22,423       (0)


              CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                              (unaudited)
               (In thousands, except per share amounts)

                                  For the three months ended March 31,
                                      2000          1999      % Change

Interest and dividend income      $   44,241    $   34,662       28
Interest expense                     (22,257)      (18,431)      21
Net interest income                   21,984        16,231       35
Provision for loan losses             (1,400)       (1,200)      17
Net interest income after
 provision for loan losses            20,584        15,031       37
Noninterest income                     4,393         3,332       32
Noninterest expense                  (11,734)       (8,817)      33
Income before taxes                   13,243         9,546       39
Income taxes                          (4,530)       (3,534)      28
Net income                        $    8,713    $    6,012       45
Net income per share, basic(a)    $     0.39    $     0.26       50
Net income per share, diluted(a)  $     0.38    $     0.26       46
Cash income per share,
 basic(a)(b)                      $     0.41    $     0.26       58
Cash income per share,
 diluted(a)(b)                    $     0.41    $     0.26       58
Shares used to compute per
 share net income:
-- Basic(a)                           22,331        23,559       (5)
-- Diluted(a)                         22,677        23,559       (4)


                    SELECTED FINANCIAL INFORMATION
                              (unaudited)
                        (Dollars in thousands)

                                                    For the
                                              three months ended
                                                   March 31,
Selected Ratios                        2000          1999      %Change

For The Period
Return on average assets               1.50%         1.19%        26
Return on average equity              23.08%        15.98%        44
Interest rate spread                   3.56%         2.95%        21
Net interest margin                    4.01%         3.35%        20
Noninterest expense/average assets(c)  1.72%         1.61%         7
Efficiency ratio(c)                   38.02%        41.61%        (9)
Net chargeoffs to average loans        0.03%         0.01%       200
Period End
Tier 1 risk-based capital ratio
 (Bank)                                8.78%        10.14%       (13)
Total risk-based capital ratio
 (Bank)                               10.04%        11.35%       (12)
Tier 1 leverage ratio (Bank)           6.83%         7.24%        (6)
Nonperforming assets to total assets   0.67%         0.69%        (3)
Nonaccrual loans to total loans        0.63%         0.34%        85
Allowance for loan losses to total
 loans                                 1.45%         1.48%        (2)
Allowance for loan losses to
 nonaccrual loans                    230.31%       440.87%       (48)


                    SELECTED FINANCIAL INFORMATION
                              (unaudited)
                        (Dollars in thousands)

                                  For the three months ended March 31,
Average Balances                      2000          1999      % Change

Loans
Residential first mortgage        $  288,756    $  255,810        13
Real estate -- multifamily           311,571       177,471        76
Real estate -- commercial            579,782       360,813        61
Real estate -- construction          133,056        85,003        57
Commercial                           158,881       125,007        27
Trade finance                        109,604       106,727         3
Consumer                              31,782        20,861        52
Total loans                       $1,613,432    $1,131,692        43
Investment securities                541,080       688,515       (21)
Earning assets                     2,191,374     1,939,075        13
Assets                             2,317,226     2,017,563        15
Deposits
Noninterest-bearing                  176,613        98,837        79
Interest-bearing, core               945,434       813,515        16
Total core deposits                1,122,047       912,352        23
Time deposits -- $100,000 and
 over                                538,176       383,412        40
Total deposits                     1,660,223     1,295,764        28
Interest-bearing liabilities       1,971,551     1,753,867        12
Stockholders' equity                 151,035       150,472         0


                    SELECTED FINANCIAL INFORMATION
                              (unaudited)
                        (Dollars in thousands)

                                                     For the
                                               three months ended
                                                    March 31,
                                        2000          1999     %Change

Noninterest income:
Loan fees                         $      528    $      528         0
Branch fees                            1,216           728        67
Letter of credit fees and
 commissions                           1,082           982        10
Gain on securities                       323           398       (19)
Gain on sale of investment in
 affordable housing partnerships         905           402       125
Amortization of negative
 intangibles                             104           103         1
Other                                    235           191        23
Total                             $    4,393    $    3,332        32
Noninterest expense:
Compensation and other employee
 benefits                         $    4,593    $    4,674        (2)
Net occupancy of premises              1,780         1,364        30
Deposit insurance premiums and
 regulatory assessments                   96           208       (54)
Data processing                          442           332        33
Amortization of positive intangibles     780           310       152
Amortization of investments in
 affordable housing partnerships         965           410       135
OREO operations, net                      30          (284)     (111)
Other                                  3,048         1,803        69
Total                             $   11,734    $    8,817        33

(a) Per share data adjusted to reflect the 118,875 for 550,000 reverse
    stock split effective June 11, 1998.

(b) Excludes the amortization of intangibles.

(c) Excludes the amortization of intangibles and investments in
    affordable housing partnerships.