East West Bancorp (EWBC) in Pasadena, Calif., reported a small rise in quarterly profit because of loan growth.
The $24.5 billion-asset company said Wednesday that its earnings rose 3% from a year earlier, to $73.2 million. Earnings per share were 53 cents were a penny below estimates from analysts polled by Bloomberg expected.
Net interest income rose 15% from a year earlier, to $254 million, as loans receivable rose 19% from the third quarter of last year, to $17.2 billion. Deposits increased by 15% from a year earlier, to $20.4 billion. East Wests net interest margin compressed by 51 basis points from a year earlier, to 3.44%.
East West recorded a noninterest loss of $41.4 million, compared with noninterest income of $2.8 million a year earlier. The loss was due to a reduction in its Federal Deposit Insurance Corp.indemnification asset. Fee revenue was strong, as branch fees, loan fees and fees from letters of credit all increased.
The loan-loss provision fell 66% from a year earlier, to $4.5 million. Net chargeoffs fell to $334,000, compared to $10.6 million a year earlier.
Noninterest expense fell less than 1% from a year earlier, to $100.4 million.
East West agreed last month to pay $273 million to buy MetroCorp, a deal that would greatly boost its presence in Texas. East West expects the deal to close in the first quarter.