Parent Company Condensed Financial Statements

12 Months Ended

Dec. 31, 2021

Condensed Financial Information Disclosure [Abstract]

Parent Company Condensed Financial Statements

Parent Company Condensed Financial StatementsThe principal sources of East West’s income (on a Parent Company-only basis) are dividends from the Bank. In addition to dividend restrictions set forth in statutes and regulations, the banking agencies have the authority to prohibit or to limit the Bank from paying dividends, if, in the banking regulator’s opinion, payment of a dividend would constitute an unsafe or unsound practice in light of the financial condition of the Bank. The Bank declared $200.0 million, $511.0 million and $190.0 million of dividends to East West during the years ended December 31, 2021, 2020 and 2019, respectively.

The following tables present the Parent Company-only condensed financial statements:

CONDENSED BALANCE SHEET

($ in thousands, except shares)	December 31,
	2021		2020
ASSETS
Cash and cash equivalents due from subsidiary bank	$	345,018	$	439,065
Investments in subsidiaries:
Bank	5,626,975		5,048,896
Nonbank	9,136		6,738
Investments in tax credit investments, net	4,082		6,586
Other assets	9,407		3,072
TOTAL	$	5,994,618	$	5,504,357
LIABILITIES
Long-term debt	$	147,658	$	147,376
Accrued income tax payable	—		81,741
Other liabilities	9,742		6,065
Total liabilities	157,400		235,182
STOCKHOLDERS’ EQUITY
Common stock, $0.001 par value, 200,000,000 shares authorized; 167,790,645 and 167,240,600 shares issued in 2021 and 2020, respectively	168		167
Additional paid-in capital	1,893,557		1,858,352
Retained earnings	4,683,659		4,000,414
Treasury stock, at cost 25,882,691 shares in 2021 and 25,675,371 shares in 2020	(649,785)		(634,083)
AOCI, net of tax	(90,381)		44,325
Total stockholders’ equity	5,837,218		5,269,175
TOTAL	$	5,994,618	$	5,504,357

CONDENSED STATEMENT OF INCOME

($ in thousands)	Year Ended December 31,
	2021		2020		2019
Dividends from subsidiaries:
Bank	$	200,000	$	511,000	$	190,000
Nonbank	82		109		189
Other income	11		3		425
Total income	200,093		511,112		190,614
Interest expense on long-term debt	2,974		3,877		6,482
Compensation and employee benefits	6,370		6,210		5,479
Amortization of tax credit and other investments	425		1,248		8,437
Other expense	1,306		1,184		1,487
Total expense	11,075		12,519		21,885
Income before income tax benefit and equity in undistributed income of subsidiaries	189,018		498,593		168,729
Income tax benefit	3,005		4,158		6,737
Undistributed earnings of subsidiaries, primarily bank	680,958		65,046		498,569
Net income	$	872,981	$	567,797	$	674,035

CONDENSED STATEMENT OF CASH FLOWS

($ in thousands)	Year Ended December 31,
	2021		2020		2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	872,981	$	567,797	$	674,035
Adjustments to reconcile net income to net cash provided by operating activities:
Undistributed earnings of subsidiaries, principally bank	(680,958)		(65,046)		(498,569)
Amortization expense	1,877		1,523		8,703
Deferred income tax expense (benefit)	2,721		491		(10,132)
Net change in other assets	(5,685)		40		10,246
Net change in other liabilities	(81,706)		77,052		(18)
Net cash provided by operating activities	109,230		581,857		184,265
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in investments in tax credit investments	(346)		(172)		(292)
Distributions received from equity method investees	436		4,096		2,577
Net increase in investments in and advances to nonbank subsidiaries	(1,476)		(2,732)		(3,314)
Other investing activities	—		—		(157)
Net cash (used in) provided by investing activities	(1,386)		1,192		(1,186)
CASH FLOWS FROM FINANCING ACTIVITIES
Common stock:
Proceeds from issuance pursuant to various stock compensation plans and agreements	2,573		2,326		3,383
Stock tendered for payment of withholding taxes	(15,702)		(8,253)		(14,635)
Repurchased of common stock pursuant to the Stock Repurchase Program	—		(145,966)		—
Cash dividends paid	(188,762)		(158,222)		(155,107)
Net cash used in financing activities	(201,891)		(310,115)		(166,359)
Net (decrease) increase in cash and cash equivalents	(94,047)		272,934		16,720
Cash and cash equivalents, beginning of year	439,065		166,131		149,411
Cash and cash equivalents, end of year	$	345,018	$	439,065	$	166,131