ex99-1.htm

FOR FURTHER INFORMATION AT THE COMPANY:

Irene Oh

Chief Financial Officer

(626) 768-6360

EAST WEST BANCORP REPORTS 46% INCREASE IN EARNINGS FOR THE SECOND QUARTER 2010 TO $36.3 MILLION AND NONPERFORMING ASSETS TO TOTAL ASSETS BELOW 1.00%

Pasadena, CA – July 27, 2010 – East West Bancorp, Inc. (Nasdaq: EWBC), parent company of East West Bank, one of the nation’s premier regional banks, today reported financial results for the second quarter of 2010. For the second quarter of 2010, net income was $36.3 million or $0.21 per diluted share.

“For the second quarter, East West increased net income 46% from $24.9 million in the previous quarter to $36.3 million. This continued profitability was driven by our improving asset quality, our ability to integrate the United Commercial Bank acquisition quickly and efficiently and the strong performance of our franchise,” stated Dominic Ng, Chairman and Chief Executive Officer of East West. “I am pleased to report that our credit indicators continue to trend in a positive direction. Quarter over quarter, our provision for loan losses decreased by $21.2 million or 28% and net charge-offs decreased $8.7 million or 14%. Further, our nonperforming assets to total assets ratio has remained below 1% for three consecutive quarters.”

Ng stated, “During the quarter, we acquired Washington First International Bank through an FDIC-assisted transaction and strengthened our operations in the greater Seattle area. This strategically attractive acquisition increased our market share in the Seattle region in a cost-effective, immediately accretive way.”

“For the remainder of 2010, East West will focus on growing our revenue and profitability and reinvesting in our business while remaining disciplined on expenses. For the past three consecutive quarters we have increased our profitability and expect to continue to do so for the remainder of 2010,” concluded Ng.

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Second Quarter 2010 Highlights

·	Second Quarter Earnings – For the second quarter 2010, net income was $36.3 million, an increase of $11.4 million over net income of $24.9 million reported in the first quarter of 2010 and an increase of $128.4 million over a net loss of $92.1 million reported in the second quarter of 2009.

Acquisition of Washington First International Bank – East West acquired the banking operations of Seattle-based Washington First International Bank (WFIB) in a purchase and assumption agreement with the Federal Deposit Insurance Corporation (FDIC) on June 11, 2010. East West acquired total assets of $492.6 million, including $313.9 million of loans (net of purchase accounting adjustments) and assumed $395.9 million in deposits.

·	Net Charge-offs Down 14% from Q1 2010, Down 59% from Q2 2009 – Net charge-offs declined to $55.2 million, a decrease of $8.7 million or 14% from the prior quarter and a decrease of $78.7 million or 59% from the second quarter of 2009.

·	Nonperforming Assets to Total Assets Below 1% – Nonperforming assets remain low at $195.6 million, or 0.98% of total assets, a decline of 51 basis points from June 30, 2009.

Strong Core Deposit Growth – Core deposits grew to a record $8.2 billion as of June 30, 2010, an increase of $444.1 million or 6% from March 31, 2010. At June 30, 2010 core deposits from WFIB totaled $84.2 million. Excluding the impact of the WFIB acquisition, East West grew core deposits by $359.9 million or 5% from March 31, 2010.

Strong Net Interest Margin – The net interest margin for the quarter totaled 4.66%. Excluding discount accretion on covered loan dispositions and recoveries, the net interest margin totaled 3.98% for the quarter, compared to 2.98% in the second quarter of 2009. (See reconciliation of the GAAP financial measure to this non-GAAP financial measure in the tables attached.)

·	Strong Capital Levels – As of June 30, 2010, East West’s Tier 1 risk-based capital and total risk-based capital ratios were 18.9% and 20.8%, respectively, significantly higher than the well capitalized requirements of 6% and 10%, respectively.

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Management Guidance

The Company is providing guidance for the third quarter of 2010. Management currently estimates that fully diluted earnings per share for the third quarter of 2010 will range from $0.19 to $0.22 per diluted share. This EPS guidance is based on the following assumptions:

·	Flat balance sheet growth

·	A stable interest rate environment and a net interest margin between 3.98% and 4.02%, excluding the impact of discount accretion on covered loan dispositions and recoveries

·	Provision for loan losses of approximately $35 million to $40 million for the quarter

·	Noninterest expense of approximately $105 million, net of FDIC reimbursable items

·	Effective tax rate of approximately 37%

FDIC-Assisted Acquisition of Washington First International Bank

On June 11, 2010, East West acquired the banking operations of Seattle-based WFIB in a purchase and assumption agreement with the FDIC. East West acquired total assets of $492.6 million and assumed $395.9 million in deposits, net of purchase accounting adjustments. This strategically attractive transaction expands East West’s footprint in the greater Seattle area, enhancing our ability to increase operating efficiencies and grow our customer base in this region.

In connection with the acquisition, East West entered into a loss-sharing agreement with the FDIC that covers approximately $420.0 million in loans and real estate owned. Pursuant to the terms of the loss-sharing arrangement, the FDIC is obligated to reimburse the Bank for 80% of all eligible losses on covered assets. As a result of this transaction, East West recorded a pre-tax gain of $19.5 million.

The integration of WFIB is progressing smoothly and we are on target for full integration of all systems by the end of October 2010.

All WFIB legacy loans were accounted for at fair value at the date of acquisition and recorded at a discount to book value. As such, losses that East West expects to incur have already been written off and considered in the fair value of loans acquired as of June 11, 2010.

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A summary of the net assets received from the FDIC is as follows:

	June 11, 2010
	(in thousands)
Assets
Cash and cash equivalents	$	67,186
Investment securities		37,532
Core deposit intangible		3,065
Loans covered by FDIC loss sharing (gross balance $395,156 and shown net of discount of $84,174)		310,982
Loans not covered by FDIC loss sharing		2,869
FDIC indemnification asset		41,131
Other real estate owned covered, net		23,443
Other Assets		6,380
Total Assets Acquired	$	492,588
Liabilities
Deposits		395,910
FHLB Advances		65,348
Securities sold under repurchase agreements		1,937
Other Liabilities		9,917
Total Liabilities Assumed	$	473,112
Net assets acquired	$	19,476

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Balance Sheet Summary

At June 30, 2010 total assets were $20.0 billion compared to $20.3 billion at March 31, 2010, and $12.7 billion at June 30, 2009. The decrease in total assets quarter over quarter was driven by prepayments on FHLB advances of $740.0 million, sales of consumer student loans of $227.3 million and sales of fixed rate investment securities of $208.7 million.

Gross loans at June 30, 2010 totaled $13.7 billion, compared to $13.8 billion at March 31, 2010. Noncovered loan balances decreased $82.7 million during the quarter to $8.5 billion as of June 30, 2010. During the quarter, growth in commercial loans of $84.1 million and single family loans of $71.7 million was offset by decreases in consumer loans resulting from the sale of student loans and paydowns on commercial real estate, construction and land loans.

Covered loans totaled $5.3 billion at June 30, 2010, as compared to $5.2 billion at March 31, 2010. The increase in covered loans was a result of the addition of $311.0 million in loans from the acquisition of WFIB, partially offset by a reduction in loan balances from United Commercial Bank.

Deposit balances totaled $14.9 billion at June 30, 2010, compared to $14.6 billion at March 31, 2010. During the quarter East West assumed $395.9 million in deposits from the acquisition of WFIB, reduced brokered deposits by $174.5 million and increased deposits organically by $90.6 million. Total core deposits increased to a record $8.2 billion as of June 30, 2010, or an increase of $444.1 million or 6% from March 31, 2010. The average cost of deposits decreased to 0.80% for the second quarter, an improvement of 13 basis points from the first quarter of 2010 and an improvement of 67 basis points from the second quarter of 2009.

During the second quarter of 2010, East West continued to execute on its strategy to lower borrowing costs, prepaying $740.0 million in FHLB advances with an average cost of 1.72% during the quarter. As of June 30, 2010, FHLB advances totaled $1.0 billion, a decline of $747.4 million or 42% from March 31, 2010. As a result of the prepayments, East West incurred a prepayment penalty of $3.9 million, net of purchase accounting adjustments recorded, which is included in noninterest expense. The average cost of funds decreased to 1.17% for the second quarter of 2010, down 11 basis points from the first quarter of 2010 and down 95 basis points from the second quarter of 2009.

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Second Quarter 2010 Operating Results

Net Interest Income

Despite a prolonged and challenging low interest rate environment, net interest income has remained stable. As previously discussed, East West has grown low-cost core deposits, reducing the cost of deposits to 0.80% for the second quarter of 2010, down from 0.93% in the first quarter of 2010. Further, East West prepaid higher-cost FHLB advances, improving the cost of funds.

Included in net interest income is discount accretion on early payoffs and recoveries on covered loans of $29.8 million in the second quarter of 2010, compared to $81.3 million in the first quarter of 2010. Excluding the impact of discount accretion, the net interest margin was 3.98% for the second quarter of 2010, compared to 4.02% in the prior quarter and an increase from 2.98% in the second quarter of 2009.

The adjustments to net interest income are summarized in the table below:

Reconciliation of Net Interest Income to Adjusted Net Interest Income

	June 30, 2010					March 31, 2010
	Interest		Yield			Interest		Yield
Net interest income and net interest margin	$	203,623		4.66	%	$	261,724		5.92	%
Less yield adjustment related to:
Covered loan disposition and recoveries		29,755					81,343
Repurchase agreement termination gain		-					2,536
Total yield adjustment		29,755				$	83,879
Net interest income and net interest margin, excluding
yield adjustment	$	173,868		3.98	%	$	177,845		4.02	%

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Noninterest Income

Noninterest income for the second quarter totaled $35.7 million, compared to a loss of $8.5 million in the first quarter of 2010 and a loss of $26.2 million in the second quarter of 2009. The loss in the first quarter of 2010 was primarily due to a $43.6 million decrease in the FDIC indemnification asset and receivable compared to a $9.4 million decrease in the second quarter of 2010. The decreases in the FDIC indemnification asset and receivable in both the first and second quarters are primarily due to early payoffs on covered loans, resulting in a net reduction in the FDIC indemnification asset and receivable. The loss in the second quarter of 2009 was primarily due to impairment losses on investment securities of $37.4 million compared to $4.6 million of impairment losses in the second quarter of 2010.

As previously mentioned, during the second quarter we sold $227.3 million in student loans and $208.7 million in fixed rate investment securities at gains of $8.1 million and $5.8 million, respectively. Noninterest income for the second quarter also included a gain of $19.5 million as a result of the acquisition of WFIB.

During the second quarter we recorded impairment losses on investment securities totaling $4.6 million, of which $2.4 million was recorded on pooled trust preferred securities and $2.2 million was recorded on agency preferred stock. As of June 30, 2010, the agency preferred stock was written down to zero.

As compared to the second quarter of 2009, branch fees increased by $3.2 million or 65%, letters of credit fees and commissions increased $935 thousand or 48%, and ancillary loan fees increased $1.0 million or 75%, primarily due to the acquisition of UCB. Excluding the impact of the decrease in the FDIC indemnification asset and receivable, gains on sales of investment securities and loans, gain on acquisition, and impairment charges on investment securities, noninterest income for the second quarter totaled $16.4 million, a $6.8 million or a 71% increase as compared to the second quarter of 2009. See reconciliation of the GAAP financial measure to this non-GAAP financial measure in the tables attached. A summary of these second quarter 2010 noninterest income items is detailed below:


	Quarter Ended
	June 30, 2010
Noninterest income	$	35,685
Add:
Impairment loss on investment securities		4,642
Net gain on sale of investment securities		(5,847	)
Net gain on sale of loans		(8,073	)
Gain on acquisition		(19,476	)
Decrease in FDIC indemnification asset and FDIC receivable		9,424
Operating noninterest income	$	16,355

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Noninterest Expense

Noninterest expense totaled $125.3 million for the second quarter of 2010 compared to $138.9 million for the first quarter of 2010. Second quarter noninterest expense includes $28.7 million of expenses that are either not expected to be ongoing expenses in future quarters or are reimbursable from the FDIC, as detailed in the table below:

	Quarter Ended
	June 30, 2010
Noninterest Expense:	$	125,318
Prepayment penalty for FHLB advances		3,900
Expenses related to the integration of UCB		3,602

Expenses for UCB covered assets, reimbursable from the FDIC:
OREO expenses		15,258
Loan related expenses		4,062
Legal expenses		1,877
Total reimbursable expenses on covered assets		21,197
Noninterest expense excluding prepayment penalty on FHLB advances, integration costs related to the acqusition of UCB, and reimbursable expenses	$	96,619

Included in noninterest expense are integration expenses of $3.6 million, of which $1.5 million is related to severance costs. In addition, under the loss share agreement with the FDIC, 80% of eligible expenses on covered assets are reimbursable from the FDIC. In the second quarter, we incurred $26.5 million in expenses on covered loans and REO assets, 80%, or $21.2 million of which we expect to be reimbursed by the FDIC. As discussed above, East West also prepaid $740.0 million in FHLB advances and paid a prepayment penalty of $3.9 million. Management anticipates that in the third quarter of 2010, noninterest expense will total approximately $105 million, net of FDIC reimbursable items.

The effective tax rate for the second quarter was 38.1% compared to 41.1% in the prior year period. The effective tax rate is reduced from the statutory tax rate primarily due to the utilization of tax credits related to affordable housing investments.

-8-

Credit Management

Credit indicators have continued to be strong. Nonperforming assets have remained low at $195.6 million as of June 30, 2010. Nonperforming assets, excluding covered assets, to total assets was 0.98% at June 30, 2010, compared to 1.49% of total assets at June 30, 2009. Nonperforming assets, excluding covered assets, as of June 30, 2010 included nonaccrual loans totaling $179.1 million and REO assets totaling $16.6 million.

The provision for loan losses was $55.3 million for the second quarter of 2010, a decrease of $21.2 million or 28% compared to the previous quarter and a decrease of $96.2 million or 64% from the second quarter of 2009. Total net charge-offs fell to $55.2 million for the second quarter, a decrease of $8.7 million or 14% from the previous quarter and a decrease of $78.7 million or 59% from the second quarter of 2009. Management expects that the provision for loan losses and net charge-offs will continue to decrease for the second half of 2010 and range from $35 million to $40 million for the third quarter of 2010.

Credit metrics on our seasoned commercial real estate portfolio have remained strong. Nonperforming commercial real estate loans were 0.52% of total commercial real estate loans as of June 30, 2010 and net charge-offs on commercial real estate loans were 1.34% of total average commercial real estate loans (annualized) for the second quarter. Further, land and construction loan balances are down to only 5% of total gross loans receivable.

Notwithstanding the improvements noted above, we have maintained a strong allowance for loan losses at $249.5 million or 2.94% of non-covered loans receivable at June 30, 2010, to cover inherent losses in the portfolio, as compared to allowance for loan losses of $250.5 million or 2.93% at March 31, 2010 and $223.7 million or 2.62% of outstanding loans at June 30, 2009.

All loans acquired from UCB and WFIB were recorded at estimated fair value as of the acquisition dates. East West entered into loss sharing agreements with the FDIC that covers future losses incurred on nearly all the UCB and WFIB legacy loans. As of June 30, 2010, we believe no allowance is required for these covered loans.

Capital Strength


Capital Strength
(Dollars in millions)
				Well Capitalized Regulatory Requirement			Total Excess Above Well Capitalized Requirement

	June 30, 2010

Tier 1 leverage capital ratio		10.5	%		5.00	%	$	1,077
Tier 1 risk-based capital ratio		18.9	%		6.00	%		1,397
Total risk-based capital ratio		20.8	%		10.00	%		1,175
Tangible common equity to tangible asset		7.90	%		N/A			N/A
Tangible common equity to risk weighted assets ratio		14.2	%		4.00	% *		1,110

*As there is no stated regulatory guideline for this ratio, the SCAP guideline of 4.00% tangible common equity has been used.

East West remains committed to maintaining strong capital levels that exceed regulatory requirements. As of the end of the second quarter of 2010, our Tier 1 leverage capital ratio increased to 10.5%, Tier 1 risk-based capital ratio totaled 18.9% and the total risk-based capital ratio totaled 20.8%. East West exceeds well capitalized requirements for all regulatory guidelines by over $1.0 billion.

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Dividend Payout

East West’s Board of Directors has declared third quarter dividends on the common stock and Series A Preferred Stock. The common stock cash dividend of $0.01 is payable on or about August 24, 2010 to shareholders of record on August 10, 2010. The dividend on the Series A Preferred Stock of $20.00 per share is payable on August 1, 2010 to shareholders of record on July 15, 2010.

About East West

East West Bancorp is a publicly owned company with $20.0 billion in assets and is traded on the Nasdaq Global Select Market under the symbol “EWBC”. The Company’s wholly owned subsidiary, East West Bank, is one of the largest independent commercial banks headquartered in California with over 130 locations worldwide, including the U.S. markets of California, New York, Georgia, Massachusetts, Texas and Washington. In Greater China, East West’s presence includes a full service branch in Hong Kong and representative offices in Beijing, Shanghai, Shenzhen and Taipei. Through a wholly-owned subsidiary bank, East West’s presence in Greater China also includes full service branches in Shanghai and Shantou and representative offices in Beijing and Guangzhou. For more information on East West Bancorp, visit the Company's website at www.eastwestbank.com.

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 Dec. 31, 2009 (See Item I -- Business, and Item 7 -- Management’s Discussion and Analysis of Consolidated Financial Condition and Results of Operations), 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 borrowers to perform as required under the terms of their loans; effect of additional provisions for loan losses; effect of any goodwill impairment, the ability of EWBC and its subsidiaries to increase its customer base; the effect of regulatory and legislative action, including California tax legislation and an announcement by the state’s Franchise Tax Board regarding the taxation of Registered Investment Companies; 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 event.

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

	June 30, 2010			December 31, 2009
Assets
Cash and cash equivalents	$	1,185,944		$	835,141
Short-term investments		447,168			510,788
Securities purchased under resale agreements		230,000			227,444
Investment securities		2,077,011			2,564,081
Loans receivable, excluding covered loans (net of allowance for
loan losses of $249,462 and $238,833)		8,177,966			8,246,685
Covered loans		5,275,492			5,598,155
Total loans receivable, net		13,453,458			13,844,840
Federal Home Loan Bank and Federal Reserve stock		223,395			217,002
FDIC indemnification asset		947,011			1,091,814
Other real estate owned, net		16,562			13,832
Other real estate owned covered, net		113,999			44,273
Premiums on deposits acquired, net		86,106			89,735
Goodwill		337,438			337,438
Other assets		849,229			782,824
Total assets	$	19,967,321		$	20,559,212

Liabilities and Stockholders' Equity
Deposits	$	14,918,694		$	14,987,613
Federal Home Loan Bank advances		1,022,011			1,805,387
Securities sold under repurchase agreements		1,051,192			1,026,870
Subordinated debt and trust preferred securities		235,570			235,570
Other borrowings		35,504			67,040
Accrued expenses and other liabilities		365,386			152,073
Total liabilities		17,628,357			18,274,553
Stockholders' equity		2,338,964			2,284,659
Total liabilities and stockholders' equity	$	19,967,321		$	20,559,212
Book value per common share	$	13.31		$	14.47
Number of common shares at period end		147,939			109,963

Ending Balances
	June 30, 2010			December 31, 2009
Loans receivable
Real estate - single family	$	1,033,155		$	930,840
Real estate - multifamily		985,194			1,025,849
Real estate - commercial		3,500,273			3,606,179
Real estate - land		297,364			370,394
Real estate - construction		354,547			458,292
Commercial		1,528,863			1,512,709
Consumer		774,746			624,784
Total loans receivable, excluding covered loans		8,474,142			8,529,047
Covered loans		5,275,492			5,598,155
Total loans receivable		13,749,634			14,127,202
Unearned fees, premiums and discounts		(46,714	)		(43,529	)
Allowance for loan losses		(249,462	)		(238,833	)
Net loans receivable	$	13,453,458		$	13,844,840

Deposits
Noninterest-bearing demand	$	2,396,087		$	2,291,259
Interest-bearing checking		685,572			667,177
Money market		4,162,128			3,138,866
Savings		946,043			991,520
Total core deposits		8,189,830			7,088,822
Time deposits		6,728,864			7,898,791
Total deposits	$	14,918,694		$	14,987,613

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EAST WEST BANCORP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(unaudited)

	Quarter Ended
	June 30, 2010			March 31, 2010			June 30, 2009

Interest and dividend income	$	253,533		$	318,703		$	146,333
Interest expense		(49,910	)		(56,979	)		(58,073	)
Net interest income before provision for loan losses		203,623			261,724			88,260
Provision for loan losses		(55,256	)		(76,421	)		(151,422	)
Net interest income after provision for loan losses		148,367			185,303			(63,162	)
Noninterest income (loss)		35,685			(8,451	)		(26,199	)
Noninterest expense		(125,318	)		(138,910	)		(57,912	)
Income (loss) before benefit for income taxes		58,734			37,942			(147,273	)
Provision (benefit) for income taxes		22,386			13,026			(60,548	)
Net income (loss) before extraordinary item		36,348			24,916			(86,725	)
Extraordinary item, net of tax		-			-			(5,366	)
Net income (loss) after extraordinary item	$	36,348		$	24,916		$	(92,091	)
Preferred stock dividend, inducement, and amortization of preferred stock discount		(6,147	)		(6,138	)		(23,623	)
Net income (loss) available to common stockholders	$	30,201		$	18,778		$	(115,714	)
Net income (loss) per share, basic	$	0.21		$	0.17		$	(1.83	)
Net income (loss) per share, diluted	$	0.21		$	0.13		$	(1.83	)
Shares used to compute per share net loss:
- Basic		146,372			109,961			63,105
- Diluted		147,131			146,865			63,105


	Quarter Ended
	June 30, 2010			March 31, 2010			June 30, 2009
Noninterest income (loss):
Decrease in FDIC indemnification asset and FDIC receivable	$	(9,424	)	$	(43,572	)	$	-
Impairment loss on investment securities		(4,642	)		(4,799	)		(37,447	)
Net gain on sale of investment securities		5,847			16,111			1,680
Gain on acquisition		19,476			8,095			-
Branch fees		8,219			8,758			4,991
Net gain on sale of loans		8,073						3
Letters of credit fees and commissions		2,865			2,740			1,930
Ancillary loan fees		2,369			1,689			1,356
Other operating income		2,902			2,527			1,288
Total noninterest income (loss)	$	35,685		$	(8,451	)	$	(26,199	)

Noninterest expense:
Compensation and employee benefits	$	41,579		$	50,779		$	16,509
Other real estate owned expense		20,983			18,012			8,682
Occupancy and equipment expense		13,115			11,944			6,297
Legal expense		6,183			2,907			1,755
Prepayment penalty for FHLB advances		3,900			9,932			-
Deposit insurance premiums and regulatory assessments		4,528			11,581			9,568
Amortization of premiums on deposits acquired		3,310			3,384			1,092
Data processing		3,046			2,482			1,141
Amortization of investments in affordable housing partnerships		2,638			3,037			1,652
Consulting expense		1,919			2,141			672
Loan related expenses		5,254			2,997			1,642
Other operating expense		18,863			19,714			8,902
Total noninterest expense	$	125,318		$	138,910		$	57,912

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EAST WEST BANCORP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(unaudited)

	Year To Date
	June 30, 2010			June 30, 2009

Interest and dividend income	$	572,236		$	291,256
Interest expense		(106,889	)		(123,315	)
Net interest income before provision for loan losses		465,347			167,941
Provision for loan losses		(131,677	)		(229,422	)
Net interest income after provision for loan losses		333,670			(61,481	)
Noninterest income (loss)		27,234			(12,405	)
Noninterest expense		(264,228	)		(109,318	)
Income (loss) before benefit for income taxes		96,676			(183,204	)
Provision (benefit) for income taxes		35,412			(74,013	)
Net loss before extraordinary item		61,264			(109,191	)
Extraordinary item, net of tax		-			(5,366	)
Net income (loss) after extraordinary item	$	61,264		$	(114,557	)
Preferred stock dividend, inducement, and amortization of preferred stock discount		(12,285	)		(32,366	)
Net income (loss) available to common stockholders	$	48,979		$	(146,923	)
Net income (loss) per share, basic	$	0.40		$	(2.33	)
Net income (loss) per share, diluted	$	0.34		$	(2.33	)
Shares used to compute per share net loss:
- Basic		123,445			63,052
- Diluted		142,143			63,052


	Year To Date
	June 30, 2010			June 30, 2009
Noninterest income (loss):
Decrease in FDIC indemnification asset and FDIC receivable	$	(52,996	)	$	-
Impairment loss on investment securities		(9,441	)		(37,647	)
Net gain on sale of investment securities		21,958			5,201
Gain on acquisition		27,571			-
Branch fees		16,977			9,784
Net gain on sale of loans		8,073			11
Letters of credit fees and commissions		5,605			3,784
Ancillary loan fees		4,058			3,585
Other operating income		5,429			2,877
Total noninterest income (loss)	$	27,234		$	(12,405	)

Noninterest expense:
Compensation and employee benefits	$	92,358		$	33,617
Other real estate owned expense		38,995			15,713
Occupancy and equipment expense		25,059			13,688
Deposit insurance premiums and regulatory assessments		16,109			12,893
Prepayment penalty for FHLB advances		13,832			-
Legal expense		9,090			3,533
Amortization of premiums on deposits acquired		6,694			2,217
Amortization of investments in affordable housing partnerships		5,675			3,412
Data processing		5,528			2,283
Consulting expense		4,060			1,120
Loan related expenses		8,251			3,077
Other operating expense		38,577			17,765
Total noninterest expense	$	264,228		$	109,318

-13-

EAST WEST BANCORP, INC.
QUARTERLY ALLOWANCE FOR LOAN LOSSES RECAP
(In thousands)
(unaudited)
	Quarter Ended
	6/30/2010			3/31/2010			12/31/2009			9/30/2009			6/30/2009
LOANS
Allowance balance, beginning of period	$	250,517		$	238,833		$	230,650		$	223,700		$	195,450
Allowance for unfunded loan commitments and letters of credit		(1,115	)		(808	)		(1,161	)		(1,051	)		1,442
Provision for loan losses		55,256			76,421			140,000			159,244			151,422
Impact of desecuritization		-			-			-			-			9,262

Net Charge-offs:
Real estate - single family		3,257			3,426			7,083			8,034			14,058
Real estate - multifamily		7,552			4,860			8,425			7,231			2,256
Real estate - commercial		11,836			8,201			13,305			23,105			12,472
Real estate - land		9,765			26,828			20,390			39,988			33,183
Real estate - residential construction		3,086			11,642			48,919			32,535			30,634
Real estate - commercial construction		8,548			2,029			21,355			23,051			28,602
Commercial		10,563			6,422			5,789			14,956			11,577
Trade finance		(88	)		(54	)		2,569			2,256			774
Consumer		677			575			2,821			87			320
Total net charge-offs (recovery)		55,196			63,929			130,656			151,243			133,876
Allowance balance, end of period	$	249,462		$	250,517		$	238,833		$	230,650		$	223,700

UNFUNDED LOAN COMMITMENTS AND LETTERS OF CREDIT:
Allowance balance, beginning of period	$	8,927		$	8,119		$	6,958		$	5,907		$	7,349
Provision for unfunded loan commitments and letters of credit		1,115			808			1,161			1,051			(1,442	)
Allowance balance, end of period	$	10,042		$	8,927		$	8,119		$	6,958		$	5,907
GRAND TOTAL, END OF PERIOD	$	259,504		$	259,444		$	246,952		$	237,608		$	229,607

Nonperforming assets to total assets (1)		0.98	%		0.89	%		0.91	%		1.84	%		1.49	%
Allowance for loan losses to total gross non-covered loans at end of period		2.94	%		2.93	%		2.80	%		2.74	%		2.62	%
Allowance for loan losses and unfunded loan commitments to total gross non-covered loans at end of period		3.06	%		3.03	%		2.90	%		2.82	%		2.69	%
Allowance to non-covered nonaccrual loans at end of period		139.31	%		143.62	%		137.91	%		112.82	%		137.94	%
Nonaccrual loans to total loans (2)		1.30	%		1.27	%		1.23	%		2.43	%		1.90	%

(1) Nonperforming assets excludes covered loans and REOs. Total assets includes covered assets.
(2) Nonaccrual loans excludes covered loans. Total loans includes covered loans.

-14-

EAST WEST BANCORP, INC
TOTAL NON-PERFORMING ASSETS, EXCLUDING COVERED ASSETS
(in thousands)
(unaudited)
AS OF JUNE 30, 2010
	Total Nonaccrual Loans
	90+ Days Delinquent		Under 90+ Days Delinquent		Total Nonaccrual Loans		REO Assets		Total Non-Performing Assets
Loan Type
Real estate - single family	$	14,835	$	-	$	14,835	$	395	$	15,230
Real estate - multifamily		13,180		5,521		18,701		3,131		21,832
Real estate - commercial		15,778		2,569		18,347		7,047		25,394
Real estate - land		43,775		5,292		49,067		2,541		51,608
Real estate - residential construction		1,454		23,370		24,824		2,272		27,096
Real estate - commercial construction		22,997		449		23,446		830		24,276
Commercial		19,310		8,994		28,304		-		28,304
Trade Finance		-		-		-		-		-
Consumer		1,436		104		1,540		346		1,886
Total	$	132,765	$	46,299	$	179,064	$	16,562	$	195,626

AS OF MARCH 31, 2010
	Total Nonaccrual Loans
	90+ Days Delinquent		Under 90+ Days Delinquent		Total Nonaccrual Loans		REO Assets		Total Non-Performing Assets
Loan Type
Real estate - single family	$	13,673	$	-	$	13,673	$	-	$	13,673
Real estate - multifamily		12,444		4,780		17,224		712		17,936
Real estate - commercial		28,484		4,127		32,611		2,979		35,590
Real estate - land		27,077		32,266		59,343		2,007		61,350
Real estate - residential construction		3,188		782		3,970		379		4,349
Real estate - commercial construction		15,066		9,652		24,718		830		25,548
Commercial		7,209		13,722		20,931		-		20,931
Trade Finance		-		505		505		-		505
Consumer		1,218		234		1,452		-		1,452
Total	$	108,359	$	66,068	$	174,427	$	6,907	$	181,334

AS OF DECEMBER 31, 2009
	Total Nonaccrual Loans
	90+ Days Delinquent		Under 90+ Days Delinquent		Total Nonaccrual Loans		REO Assets		Total Non-Performing Assets
Loan Type
Real estate - single family	$	3,262	$	-	$	3,262	$	264	$	3,526
Real estate - multifamily		10,631		-		10,631		2,118		12,749
Real estate - commercial		11,654		18,450		30,104		5,687		35,791
Real estate - land		27,179		42,666		69,845		4,393		74,238
Real estate - residential construction		17,179		-		17,179		540		17,719
Real estate - commercial construction		-		17,132		17,132		830		17,962
Commercial		8,002		16,765		24,767		-		24,767
Trade Finance		-		-		-		-		-
Consumer		114		146		260		-		260
Total	$	78,021	$	95,159	$	173,180	$	13,832	$	187,012

AS OF JUNE 30, 2009
	Total Nonaccrual Loans
	90+ Days Delinquent		Under 90+ Days Delinquent		Total Nonaccrual Loans		REO Assets		Total Non-Performing Assets
Loan Type
Real estate - single family	$	5,181	$	-	$	5,181	$	4,921	$	10,102
Real estate - multifamily		7,938		-		7,938		281		8,219
Real estate - commercial		19,786		4,590		24,376		2,887		27,263
Real estate - land		35,660		1,656		37,316		13,307		50,623
Real estate - residential construction		46,176		-		46,176		4,154		50,330
Real estate - commercial construction		20,629		-		20,629		-		20,629
Commercial		8,034		8,067		16,101		626		16,727
Trade Finance		3,706		-		3,706		211		3,917
Consumer		339		412		751		801		1,552
Total	$	147,449	$	14,725	$	162,174	$	27,188	$	189,362

-15-

EAST WEST BANCORP, INC.
QUARTER TO DATE AVERAGE BALANCES, YIELDS AND RATES PAID
(In thousands)
(unaudited)

	Quarter Ended
	June 30, 2010								June 30, 2009
	Average								Average
	Volume			Interest		Yield (1)			Volume			Interest		Yield (1)

ASSETS
Interest-earning assets:
Short-term investments and interest bearing deposits in other banks	$	948,361		$	1,502		0.64	%	$	876,386		$	2,509		1.15	%
Securities purchased under resale agreements		455,743			2,630		2.28	%		51,374			1,292		9.95	%
Investment securities (2)		2,202,676			14,741		2.68	%		2,612,998			30,440		4.67	%
Loans receivable		8,556,680			116,916		5.48	%		8,244,850			111,669		5.43	%
Loans receivable - covered		5,137,863			116,867		9.12	%		-			-		-
Federal Home Loan Bank and Federal Reserve Bank stocks		224,473			877		1.56	%		123,514			545		1.76	%
Total interest-earning assets		17,525,796			253,533		5.80	%		11,909,122			146,455		4.93	%

Noninterest-earning assets:
Cash and due from banks		603,907								113,853
Allowance for loan losses		(255,904	)							(198,802	)
Other assets		2,012,470								794,849
Total assets	$	19,886,269							$	12,619,022


LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Checking accounts		663,936			527		0.32	%		356,756			324		0.36	%
Money market accounts		3,968,293			8,336		0.84	%		1,822,470			6,140		1.35	%
Savings deposits		961,374			1,274		0.53	%		415,828			659		0.64	%
Time deposits		6,714,972			18,995		1.13	%		4,548,935			23,767		2.10	%
Federal Home Loan Bank advances		1,238,400			6,175		2.00	%		1,273,640			13,142		4.14	%
Securities sold under repurchase agreements		1,042,305			12,045		4.57	%		1,006,614			12,004		4.72	%
Subordinated debt and trust preferred securities		235,570			1,591		2.67	%		235,570			2,034		3.42	%
Other borrowings		49,785			967		7.68	%		4,849			3		0.24	%
Total interest-bearing liabilities		14,874,635			49,910		1.35	%		9,664,662			58,073		2.41	%

Noninterest-bearing liabilities:
Demand deposits		2,300,228								1,300,676
Other liabilities		400,783								123,431
Stockholders' equity		2,310,623								1,530,253
Total liabilities and stockholders' equity	$	19,886,269							$	12,619,022

Interest rate spread							4.45	%							2.52	%

Net interest income and net interest margin				$	203,623		4.66	%				$	88,382		2.98	%

Net interest income and net interest margin adjusted (3)				$	173,868		3.98	%

(1) Annualized
(2) Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.
(3) Amounts exclude yield adjustment related to covered loan disposition and recoveries of $29,755 for the three months ended June 30, 2010.

-16-

EAST WEST BANCORP, INC.
YEAR TO DATE AVERAGE BALANCES, YIELDS AND RATES PAID
(In thousands)
(unaudited)

	Year To Date
	June 30, 2010								June 30, 2009
	Average								Average
	Volume			Interest		Yield (1)			Volume			Interest		Yield (1)

ASSETS
Interest-earning assets:
Short-term investments and interest bearing deposits in other banks	$	1,119,912		$	5,043		0.91	%	$	804,379		$	5,485		1.38	%
Securities purchased under resale agreements		358,074			8,893		4.94	%		50,691			2,542		9.97	%
Investment securities (2)		2,194,322			34,931		3.21	%		2,658,478			59,905		4.54	%
Loans receivable		8,582,214			238,944		5.61	%		8,221,143			222,485		5.46	%
Loans receivable - covered		5,256,293			282,783		10.85	%		-			-		-
Federal Home Loan Bank and Federal Reserve Bank stocks		223,097			1,656		1.48	%		121,786			1,051		1.73	%
Total interest-earning assets		17,733,912			572,250		6.51	%		11,856,477			291,468		4.96	%

Noninterest-earning assets:
Cash and due from banks		485,965								118,351
Allowance for loan losses		(254,700	)							(192,465	)
Other assets		2,195,865								775,633
Total assets	$	20,161,042							$	12,557,996


LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Checking accounts		651,655			1,141		0.35	%		358,492			717		0.40	%
Money market accounts		3,716,606			16,302		0.88	%		1,655,476			11,834		1.44	%
Savings deposits		976,695			2,416		0.50	%		413,046			1,361		0.66	%
Time deposits		7,013,720			42,721		1.23	%		4,681,241			54,051		2.33	%
Federal Home Loan Bank advances		1,634,910			15,180		1.87	%		1,279,323			27,019		4.26	%
Securities sold under repurchase agreements		1,035,539			24,586		4.72	%		1,002,621			23,876		4.74	%
Subordinated debt and trust preferred securities		235,570			3,138		2.65	%		235,570			4,451		3.76	%
Other borrowings		74,893			1,405		3.73	%		3,653			6		0.33	%
Total interest-bearing liabilities		15,339,588			106,889		1.41	%		9,629,422			123,315		2.58	%

Noninterest-bearing liabilities:
Demand deposits		2,260,847								1,270,716
Other liabilities		258,399								122,326
Stockholders' equity		2,302,208								1,535,532
Total liabilities and stockholders' equity	$	20,161,042							$	12,557,996

Interest rate spread							5.10	%							2.38	%

Net interest income and net interest margin				$	465,361		5.29	%				$	168,153		2.86	%

Net interest income and net interest margin adjusted (3)				$	351,728		4.00	%

(1) Annualized
(2) Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate.
(3) Amounts exclude yield adjustment related to covered loan disposition and recoveries of $111,097 and repurchase agreement termination gain of $2,536 for the six months ended June 30, 2010.

-17-

EAST WEST BANCORP, INC.
SELECTED FINANCIAL INFORMATION
(In thousands)
(unaudited)

Average Balances	Quarter Ended
	June 30, 2010			March 31, 2010			June 30, 2009
Loans receivable
Real estate - single family	$	989,744		$	931,318		$	686,073
Real estate - multifamily		998,090			1,071,910			823,890
Real estate - commercial		3,530,045			3,601,112			3,516,257
Real estate - land		317,291			356,908			523,799
Real estate - construction		383,846			449,272			1,072,319
Commercial		1,492,560			1,472,451			1,387,257
Consumer		845,104			731,771			235,255
Total loans receivable, excluding covered loans		8,556,680			8,614,742			8,244,850
Covered loans		5,137,863			5,369,328			-
Total loans receivable		13,694,543			13,984,070			8,244,850
Investment securities		2,202,676			2,185,875			2,612,998
Earning assets		17,525,796			17,940,933			11,909,122
Total assets		19,886,269			20,398,717			12,619,022

Deposits
Noninterest-bearing demand	$	2,300,228		$	2,222,104		$	1,300,676
Interest-bearing checking		663,936			636,039			356,756
Money market		3,968,293			3,464,234			1,822,470
Savings		961,374			992,186			415,828
Total core deposits		7,893,831			7,314,563			3,895,730
Time deposits		6,714,972			7,315,789			4,548,935
Total deposits		14,608,803			14,630,352			8,444,665
Interest-bearing liabilities		14,874,635			15,763,168			9,664,662
Stockholders' equity		2,310,623			2,293,712			1,530,253


Selected Ratios	Quarter Ended
	June 30, 2010			March 31, 2010			June 30, 2009
For The Period
Return on average assets		0.73	%		0.49	%		-2.92	%
Return on average common equity		6.26	%		4.71	%		-43.81	%
Interest rate spread (2)		4.45	%		5.73	%		2.52	%
Net interest margin (2)		4.66	%		5.92	%		2.98	%
Net interest margin adjusted (4)		3.98	%		4.02	%		2.98	%
Yield on earning assets (2)		5.80	%		7.20	%		4.93	%
Cost of deposits		0.80	%		0.93	%		1.47	%
Cost of funds		1.17	%		1.28	%		2.12	%
Noninterest expense/average assets (1)		2.32	%		2.40	%		1.75	%
Efficiency ratio (3)		56.56	%		58.45	%		55.12	%

(1) Excludes the amortization of intangibles, amortization and impairment loss of premiums on deposits acquired, amortization of investments in affordable housing partnerships and prepayment penalty for FHLB advances.
(2) Yields on certain securities have been adjusted upward to a "fully taxable equivalent" basis in order to reflect the effect of income which is exempt from federal income taxation at the current statutory tax rate.
(3) Represents noninterest expense, excluding the amortization of intangibles, amortization and impairment loss of premiums on deposits acquired, investments in affordable housing partnerships and prepayment penalty for FHLB advances, divided by the aggregate of net interest income before provision for loan losses, excluding nonrecurring adjustments and noninterest income, excluding impairment loss on investment securities and gain on acquisition and the decrease in FDIC indemnification asset and FDIC receivable.
(4) ) Amounts exclude yield adjustment related to covered loan disposition and recoveries of $29,755 for the quarter ended June 30, 2010. and yield adjustment related to covered loan disposition of $74,439 for the quarter ended December 31, 2009.

-18-

EAST WEST BANCORP, INC.
SELECTED FINANCIAL INFORMATION
(In thousands)
(unaudited)

Average Balances	Year To Date
	June 30, 2010			June 30, 2009
Loans receivable
Real estate - single family	$	961,800		$	596,913
Real estate - multifamily		1,034,830			758,744
Real estate - commercial		3,563,975			3,491,166
Real estate - land		336,990			552,917
Real estate - construction		416,378			1,151,836
Commercial		1,479,533			1,437,732
Consumer		788,708			231,835
Total loans receivable, excluding covered loans		8,582,214			8,221,143
Covered loans		5,256,293			-
Total loans receivable		13,838,507			8,221,143
Investment securities		2,194,322			2,658,478
Earning assets		17,733,912			11,856,477
Total assets		20,161,042			12,557,996

Deposits
Noninterest-bearing demand	$	2,260,847		$	1,270,716
Interest-bearing checking		651,655			358,492
Money market		3,716,606			1,655,476
Savings		976,695			413,046
Total core deposits		7,605,803			3,697,730
Time deposits		7,013,720			4,681,241
Total deposits		14,619,523			8,378,971
Interest-bearing liabilities		15,339,588			9,629,422
Stockholders' equity		2,302,208			1,535,532


Selected Ratios	Year To Date
	June 30, 2010			June 30, 2009
For The Period
Return on average assets		0.61	%		-1.82	%
Return on average common equity		5.55	%		-27.66	%
Interest rate spread (2)		5.10	%		2.38	%
Net interest margin (2)		5.29	%		2.86	%
Net interest margin adjusted (4)		4.00	%		2.86	%
Yield on earning assets (2)		6.51	%		4.96	%
Cost of deposits		0.86	%		1.64	%
Cost of funds		1.22	%		2.28	%
Noninterest expense/average assets (1)		2.36	%		1.65	%
Efficiency ratio (3)		57.52	%		53.51	%

(1) Excludes the amortization of intangibles, amortization and impairment loss of premiums on deposits acquired, amortization of investments in affordable housing partnerships and prepayment penalty for FHLB advances.
(2) Yields on certain securities have been adjusted upward to a "fully taxable equivalent" basis in order to reflect the effect of income which is exempt from federal income taxation at the current statutory tax rate.
(3) Represents noninterest expense, excluding the amortization of intangibles, amortization and impairment loss of premiums on deposits acquired, investments in affordable housing partnerships and prepayment penalty for FHLB advances, divided by the aggregate of net interest income before provision for loan losses, excluding nonrecurring adjustments and noninterest income, excluding impairment loss on investment securities and gain on acquisition and the decrease in FDIC indemnification asset and FDIC receivable.
(4) Amounts exclude yield adjustment related to covered loan disposition and recoveries of $111,097 and repurchase agreement termination gain of $2,536 for the six months ended June 30, 2010.

-19-

EAST WEST BANCORP, INC.
GAAP TO NON-GAAP RECONCILIATION
(In thousands)
(Unaudited)

The tangible common equity to risk weighted asset and tangible common equity to tangible asset ratios is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company's performance to provide additional disclosure. As the use of tangible common equity to tangible asset is more prevalent in the banking industry and with banking regulators and analysts, we have included the tangible common equity to risk-weighted assets and tangible common equity to tangible asset ratios.

	As of
	June 30, 2010
Stockholders' Equity	$	2,338,964
Less:
Preferred Equity		(369,695	)
Goodwill and other intangible assets		(424,746	)
Tangible common equity	$	1,544,523

Risk-weighted assets		10,863,240

Tangible Common Equity to risk-weighted assets		14.2	%

	As of
	June 30, 2010
Total assets	$	19,967,321
Less:
Goodwill and other intangible assets		(424,746	)
Tangible assets	$	19,542,575

Tangible common equity to tangible asset ratio		7.90	%

Operating noninterest income is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company's performance to provide additional disclosure. There are noninterest income line items that are non-core in nature. Operating noninterest income excludes such non-core noninterest income line items. The Company believes that presenting the operating noninterest income provides more clarity to the users of financial statements regarding the core noninterest income amounts.

	Quarter Ended
	June 30, 2010
Noninterest income	$	35,685
Add:
Impairment loss on investment securities		4,642
Net gain on sale of investment securities		(5,847	)
Net gain on sale of loans		(8,073	)
Gain on acquisition		(19,476	)
Decrease in FDIC indemnification asset and FDIC receivable		9,424
Operating noninterest income (non-GAAP)	$	16,355


	Quarter Ended
	June 30, 2009
Noninterest income	$	(26,199	)
Add:
Impairment loss on investment securities		37,447
Net gain on sale of investment securities		(1,680	)
Net gain on sale of loans		(3	)
Gain on acquisition		-
Decrease in FDIC indemnification asset and FDIC receivable		-
Operating noninterest income (non-GAAP)	$	9,565

-20-

EAST WEST BANCORP, INC.
GAAP TO NON-GAAP RECONCILIATION
(In thousands)
(Unaudited)

Operating noninterest expense is a non-GAAP disclosure. The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company's performance to provide additional disclosure. There are noninterest expense line items that are non-core in nature. Operating noninterest expense excludes such non-core noninterest expense line items. The Company believes that presenting the operating noninterest expense provides more clarity to the users of financial statements regarding the core noninterest exepense amounts.
	Quarter Ended
	June 30, 2010
Noninterest Expense:	$	125,318
Prepayment penalty for FHLB advances		3,900
Expenses related to the integration of UCB		3,602

Expenses for UCB covered assets, reimbursable from the FDIC:
OREO Expenses		15,258
Loan related expenses		4,062
Legal expenses		1,877
Total reimbursable expenses on covered assets		21,197
Noninterest expense excluding prepayment penalty on FHLB advances, integration costs related to the acqusition of UCB, and reimbursable expenses	$	96,619

	Quarter Ended
	March 31, 2010
Noninterest Expense:	$	138,910
Prepayment penalty for FHLB advances		9,932
Expenses related to the integration of UCB
Compensation and employee benefits		6,240
Other integration expenses		3,664
Total integration costs related to the acquisition of UCB that are not expected to be ongoing expenses in future quarters		9,904
REO expense for UCB covered assets, reimbursable from the FDIC		11,092
Non interest expense excluding prepayment penalty on FHLB advances, integration costs related to the acqusition of UCB, and reimbursable REO expenses	$	107,982

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EAST WEST BANCORP, INC.
GAAP TO NON-GAAP RECONCILIATION
(In thousands)
(Unaudited)

The Company uses certain non-GAAP financial measures to provide supplemental information regarding the Company's performance to provide additional disclosure. For the second quarter of 2010, the quarter to date net interest income and net interest margin includes a yield adjustment of $29,755 related to covered loan disposition, the year to date net interest income and net interest margin includes a yield adjustment of $111,097 related to covered loan disposition and recoveries and repurchase agreement termination gain of $2,536. For the first quarter of 2010 net interest income and net interest margin includes a yield adjustment of $81,343 related to covered loan disposition and recoveries and repurchase agreement termination gain of $2,536. These amounts are nonrecurring in nature. As such, the Company believes that presenting the net interest income and net interest margin excluding these nonrecurring items provides additional clarity to the users of financial statements regarding the core net interest income and net interest margin.

	Quarter Ended June 30, 2010
	Average Volume		Interest		Yield
Total interest-earning assets	$	17,525,796	$	253,533		5.80	%
Net interest income and net interest margin			$	203,623		4.66	%
Less yield adjustment related to:
Covered loan disposition and recoveries				29,755
Net interest income and net interest margin, excluding
yield adjustment			$	173,868		3.98	%

	Quarter Ended March 31, 2010
	Average Volume		Interest		Yield
Total interest-earning assets	$	17,940,933	$	318,717		7.20	%
Net interest income and net interest margin			$	261,724		5.92	%
Less yield adjustment related to:
Covered loan disposition and recoveries				81,343
Repurchase agreement termination gain				2,536
Total yield adjustment			$	83,879
Net interest income and net interest margin, excluding
yield adjustment			$	177,845		4.02	%

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