10-K – 2026-02-27 – ewbc-20251231.htm

The statutes and regulations that the CFPB enforces mandate certain disclosure and other requirements, and regulate the manner in which financial institutions must deal with consumers when taking deposits, making loans, collecting payments on loans, and providing other services. The CFPB’s rulemaking, examination and enforcement authority has affected and will continue to impact financial institutions that provide consumer financial products and services, including the Company and the Bank. These regulatory activities may limit the types of financial services and products the Company may offer. Failure to comply with federal and state laws prohibiting unfair, abusive, or fraudulent business practices, untrue or misleading advertising and unfair competition, can subject the Bank to various penalties, including, but not limited to, enforcement actions, injunctions, fines or criminal penalties, punitive damages, restitution to consumers, and the loss of certain contractual rights or business opportunities and may also result in significant reputational harm.

Federal Home Loan Bank and the Federal Reserve’s Reserve Requirements

The Bank is a member of the Federal Home Loan Bank (“FHLB”) of San Francisco. As an FHLB member, the Bank is required to own a certain amount of capital stock in the FHLB. The Bank may also access both short- and long-term secured credit from the FHLB.

The Federal Reserve requires all depository institutions to maintain reserves at specified levels against their transaction accounts either in the form of vault cash or an interest-bearing account at the Federal Reserve Bank (“FRB”), or a pass-through account as defined by the Federal Reserve. Reserve requirements are currently set at zero percent. The Bank is a member bank and stockholder of the FRB of San Francisco.

Dividends and Other Transfers of Funds

The principal source of liquidity of East West is dividends received from the Bank. Federal and California law limit the Bank’s ability to pay dividends to East West. Regulatory approval is required under federal law if the total of all dividends declared by the Bank in any calendar year would exceed the sum of the Bank’s net income for that year and its retained earnings for the preceding two years. Federal law also prohibits the Bank from paying dividends that would be greater than its undivided profits unless the Bank has received prior approval from the Federal Reserve. California law imposes its own limitations on capital distributions by California-chartered banks that could require the Bank to obtain the approval of the DFPI prior to making a distribution to East West. Furthermore, under the federal PCA regime, the Federal Reserve or FDIC may prohibit a bank holding company from paying any dividends if the holding company’s bank subsidiary is classified as “significantly undercapitalized” or, in some circumstances, “undercapitalized.” It is the Federal Reserve’s policy that a bank holding company should generally pay dividends on common stock only if the company’s net income available to common stockholders over the past four quarters, net of distributions, would be sufficient to fully fund the dividends, and if the prospective rate of earnings retention appears consistent with the company’s capital needs, asset quality and overall financial condition. It is also the Federal Reserve’s policy that a bank holding company should not maintain dividend levels that undermine the company’s ability to be a financial source of strength to its banking subsidiaries. The Federal Reserve requires bank holding companies to continuously review their dividend policy in light of their organizations’ financial condition and in compliance with regulatory capital requirements, and discourages payment ratios that are at maximum allowable levels, unless both asset quality and capital are strong.

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Transactions with Affiliates and Insiders

Pursuant to Sections 23A and 23B of the Federal Reserve Act, as implemented by the Federal Reserve’s Regulation W, banks are subject to restrictions that limit their ability to engage in transactions with their affiliates, including their parent bank holding companies. Regulation W limits the types, terms and amounts of these transactions and generally requires the transactions to be on an arm’s-length basis. In general, Regulation W requires that “covered transactions,” which include a bank’s extension of credit to or purchase of assets from an affiliate, be limited to 10% of the bank’s capital and surplus with respect to any one affiliate, and 20% of the bank’s capital and surplus with respect to the aggregate of all covered transactions with all affiliates. In addition, a bank generally may not extend credit to an affiliate unless the extension of credit is secured by specified amounts of collateral. The Dodd-Frank Act expanded the coverage and scope of the limitations on affiliate transactions by treating derivative transactions resulting in a bank’s credit exposure to an affiliate as covered transactions. In addition, the Volcker Rule under the Dodd-Frank Act establishes certain prohibitions, restrictions and requirements (known as “Super 23A” and “Super 23B”) on transactions between a covered fund and a banking entity that serves as an investment manager, investment adviser, organizer and offeror, or sponsor with respect to that covered fund, regardless of whether the banking entity has an ownership interest in the fund.

Federal law also limits a bank’s authority to extend credit to its directors, executive officers and principal stockholders, as well as to entities controlled by such persons (collectively, “insiders”). Among other things, extensions of credit to insiders are required to be made on terms that are substantially the same as, and follow credit underwriting procedures that are not less stringent than, those prevailing for comparable transactions with unaffiliated persons. The terms of such extensions of credit may not involve more than the normal risk of repayment or present other unfavorable features and may not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of the bank’s capital.

Community Reinvestment Act

Under the CRA, an IDI has a continuing and affirmative obligation to help serve the credit needs of its communities, including low- and moderate-income borrowers and neighborhoods. The Federal Reserve periodically evaluates a state member bank’s performance under applicable performance criteria and assigns a rating of “outstanding,” “satisfactory,” “needs to improve” or “substantial noncompliance.” The Federal Reserve takes this performance into account when reviewing applications by banks and their parent companies to expand branches, relocate, add subsidiaries and affiliates, expand into new financial activities and merge with or acquire other financial institutions. Unsatisfactory CRA performance may result in the denial of such applications.

On October 24, 2023, the federal banking agencies issued a final rule revising their framework for evaluating banks’ records of community investment under the CRA. On July 16, 2025, the agencies issued a proposal to rescind the October 2023 final rule and reinstate the CRA framework that existed prior to the October 2023 final rule. The Bank received a rating of “Outstanding” in its most recent performance evaluation, which was conducted as of August 12, 2024 using the CRA framework that existed prior to the October 2023 final rule.

FDIC Deposit Insurance Assessments

The FDIC insures the Bank’s customer deposits through the DIF up to $250,000 for each depositor, per FDIC-insured bank, for each account ownership category. The DIF is funded mainly through quarterly insurance assessments on insured banks based on their assessment base. The Dodd-Frank Act revised the FDIC’s fund management authority by establishing a minimum Designated Reserve Ratio of 1.35 percent of total estimated insured deposits and redefining the assessment base to be calculated as average consolidated total assets minus average tangible equity. The Bank’s DIF quarterly assessment is calculated by multiplying its assessment base by the applicable assessment rate. The assessment rate is calculated based on an institution’s risk profile, including capital adequacy, asset quality, management, earnings, liquidity and sensitivity to market risk ratings, certain financial measures to assess an institution’s ability to withstand asset related stress and funding related stress, and a measure of loss severity that estimates the relative magnitude of potential losses to the FDIC in the event of the Bank’s failure.

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A 2022 FDIC rule increased the initial base deposit insurance assessment rate schedules uniformly by two basis points (“bps”) beginning in the first quarterly assessment period of 2023, and this increase will remain in effect until the reserve ratio of the DIF meets or exceeds 2 percent. In November 2023, the FDIC approved a final rule to implement a special deposit insurance assessment for eight quarters, starting with the first quarter of 2024, to recover losses to the DIF arising from bank failures that occurred in the Spring of 2023. The Company recognized the entire initial FDIC special assessment charge (the “FDIC charge”) of approximately $70 million in the fourth quarter of 2023, and recognized additional charges of $9 million in 2024 due to changes in the FDIC’s estimate of the DIF losses. In December 2025, the FDIC updated the estimated DIF losses and projected that the amount collected through the initial eight-quarter collection period would recover the entire amount of estimated losses. Accordingly, the Company recorded $9 million of FDIC special assessment reversals in 2025.

The FDIC may terminate a depository institution’s deposit insurance upon a finding that the institution’s financial condition is unsafe or unsound, that the institution has engaged in unsafe or unsound practices, or that the institution has violated any applicable rule, regulation, condition, or order imposed by the FDIC.

Bank Secrecy Act and Anti-Money Laundering

The Bank Secrecy Act (“BSA”), Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001 (“PATRIOT Act”), the Anti-Money Laundering Act of 2020 and other federal laws and regulations impose obligations on U.S. financial institutions to implement and maintain a program reasonably designed to prevent, detect and report money laundering and the financing of terrorism, verify the identity of their customers, and comply with recordkeeping and other requirements. Regulatory agencies require that the Bank have an effective governance structure for the program that includes effective oversight by our Board of Directors and management. We regularly evaluate and continue to enhance our program to comply with the BSA, the PATRIOT Act and other anti-money laundering (“AML”) laws, regulations and initiatives. Failure of a financial institution to maintain and implement adequate BSA/AML programs, or to comply with all applicable laws or regulations, could have serious legal, compliance, operational, financial and reputational consequences for the institution.

Office of Foreign Assets Control Regulation

The U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) is responsible for helping to ensure that U.S. financial institutions do not engage in transactions with certain prohibited parties, as defined by various executive orders and Acts of Congress. Federal banking regulators also examine banks for compliance with regulations administered by the OFAC for economic sanctions against designated foreign countries, designated nationals, and others. OFAC publishes lists of persons and organizations suspected of aiding, harboring or engaging in terrorist acts, known as Specially Designated Nationals and Blocked Persons. Generally, if a bank identifies a transaction or account relating to a person or entity on an OFAC list, it must freeze the account, block or reject the transaction, file a suspicious activity report and/or notify the appropriate authorities. Failure to comply with these sanctions could have serious legal, compliance, operational, financial, and reputational consequences, and result in civil monetary penalties on the Company and the Bank.

Privacy and Cybersecurity

Federal statutes and regulations, including the GLBA, require banking organizations to take certain actions to protect nonpublic consumer financial information. The Bank has a privacy policy that it must disclose to consumers annually. In some cases, the Bank must obtain a consumer’s consent before sharing information with an unaffiliated third party, and the Bank must allow a consumer to opt out of the Bank’s sharing of information with its affiliates for marketing and certain other purposes. These additional conditions affect the Bank’s information exchanges with credit reporting agencies. The Bank’s privacy practices and the effectiveness of its systems to protect consumer privacy are subjects covered in the Federal Reserve’s periodic compliance examinations.

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The interagency council of the federal banking agencies, the Federal Financial Institutions Examination Council (“FFIEC”), as well as the SEC, regularly issue guidance on cybersecurity practices and procedures that is intended to enhance cybersecurity risk management among financial institutions and their holding companies and affiliates. For example, the FFIEC has issued several policy statements and other guidance for banks in light of the growing risk posed by cybersecurity threats. The FFIEC has continued to focus on such matters as compromised customer credentials, cyber resilience and business continuity planning. Examinations by the banking agencies now include review of an institution’s information technology and its ability to thwart or mitigate cyber-attacks. The federal banking agencies require banking organizations to notify their primary federal regulator of significant computer security incidents within 36 hours of determining that such an incident has occurred. Effective December 2023, the SEC also has imposed Form 8-K disclosure obligations for a material cybersecurity incident, among other cybersecurity related disclosure obligations.

On April 8, 2025, the U.S. Department of Justice (the “DOJ”) final rule implementing Executive Order 14117 (“Preventing Access to Americans’ Bulk Sensitive Personal Data and U.S. Government-Related Data by Countries of Concern”) took effect, with certain specified compliance requirements taking effect on October 6, 2025. The final rule prohibits or restricts certain transactions involving access by “countries of concern” or “covered persons” to “government-related data” or “bulk U.S. sensitive personal data.” The list of countries of concern includes, among others, the People’s Republic of China, including Hong Kong and Macau. The final rule imposes certain diligence, security, audit and record-keeping requirements, and the Bank and its subsidiary, EWCN, have taken the necessary steps to comply with the rule, including by restricting access to data by subsidiaries, affiliates, and vendors.

Consumer data privacy and data protection are also the subject of state laws. For example, the Bank is subject to the California Consumer Privacy Act. Among other provisions, this statute grants consumers several rights, including the right to request to access, correct, and delete their personal information (subject to certain exceptions), and the right to opt out of the sale of their personal information and sharing of personal information for certain targeted advertising purposes. However, a consumer does not have these rights with respect to information that is collected, processed, sold, or disclosed pursuant to the GLBA or the California Financial Information Privacy Act. California also adopted new rules effective January 1, 2026, with different timing requirements depending on obligations related to cyber audits, risk assessments, and automated decision-making. Despite these evolving requirements, the Bank is not in the business of selling consumer or customer data.

The Bank’s subsidiary, EWCN, operates under China’s privacy, cybersecurity, and data security regulatory framework, which includes the Personal Information Protection Law, the Cybersecurity Law as amended effective January 1, 2026, the Data Security Law, and the Network Data Security Management Regulation that was effective January 1, 2025. EWCN has taken the necessary steps to comply with these laws, including adherence to local laws and regulations related to cross-border data sharing, and maintains policies, controls, and governance procedures designed to comply with these requirements, and also conducts periodic reviews of its data handling and network security practices. As China’s regulatory framework continues to evolve, EWCN will monitor developments and update its compliance program as applicable.

Climate-Related Laws and Regulations

During 2025, the federal banking agencies reduced their emphasis on climate-related risks by acknowledging that existing safety and soundness standards already require effective risk management practices. However, certain states, such as California, have continued to highlight climate-related financial risks as part of their sustainability objectives.

In October 2023, California Senate Bill No. 253, the Climate Corporate Data Accountability Act (“SB 253”) and Senate Bill No. 261, the Climate-Related Financial Risk Act (“SB 261”) were signed into law. SB 253 requires U.S. companies with annual revenues exceeding $1 billion that do business in California to report their Scope 1 and 2 greenhouse gas (“GHG”) emissions annually starting in 2026; and Scope 3 GHG emissions starting in 2027. SB 261 applies to U.S. companies with annual revenues over $500 million that do business in California and requires disclosure of climate-related financial risks and mitigation measures taken to address such risks with the first report due on January 1, 2026, and biennially thereafter. On December 9, 2025, California Air Resources Board communicated an August 10, 2026 deadline for the initial Scope 1 and Scope 2 GHG emissions reports required under SB 253, while reporting under SB 261 is deferred pending the outcome of litigation challenging the legislation. The Company is a reporting entity under both SB 253 and SB 261 and has engaged a third-party firm to support compliance with these laws.

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Resolution Planning

FDIC rules require covered IDIs to develop and submit detailed plans demonstrating how they could be resolved in an orderly and timely manner in the event of receivership. IDIs with total assets of $100 billion or more are required to submit full resolution plans, and IDIs with total assets between $50 billion and $100 billion, including the Bank, are required to submit more limited informational filings. If the FDIC deemed a resolution plan or informational filing not credible and the IDI then failed to resubmit a credible plan, the IDI could become subject to an enforcement action. The Bank completed and submitted its informational filing on October 1, 2025.

2025 Legislative Developments

In June 2025, California enacted Senate Bill No. 132 (“SB 132”), requiring banks and financial institutions to adopt a single sales factor for income apportionment, effective for tax years beginning on or after January 1, 2025. Prior to SB 132, financial institutions had been required to use an equally weighted three-factor apportionment formula, which considered property, payroll and sales equally in apportioning income for California tax purposes.

In July 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, introducing significant tax changes. The OBBBA extends or makes permanent various tax provisions that were originally enacted in the 2017 Tax Cuts and Jobs Act and were set to expire at the end of 2025. The OBBBA features modified versions of individual and business tax relief proposals, and other new tax relief measures. In addition, it includes various revenue-raising measures, including changes to certain Inflation Reduction Act clean energy tax credits and various limits on business and individual tax deductions, that are intended to offset part of the cost of the legislation. The Company has been evaluating the impact of the OBBBA on its business and consolidated financial statements.

In July 2025, the Guiding and Establishing National Innovation for U.S. Stablecoins Act, or the “GENIUS Act,” was signed into law, establishing a federal licensing and supervisory framework for payment stablecoins and their issuers. The GENIUS Act may accelerate and increase the competition that non-traditional financial institutions pose to banks’ payment services, but may also create opportunities for banks to hold stablecoin reserve assets, custody stablecoins, or issue stablecoins. Several key provisions of the GENIUS Act require federal regulatory agencies to adopt implementing regulations, and the Act will take effect the earlier of 18 months after its enactment or 120 days after the agencies issue final implementing regulations.

Future Legislation, Regulation and Supervision Activities

New statutes, regulations and policies that contain wide-ranging proposals for altering the structures, regulations and competitive relationships of financial institutions and public companies are regularly adopted. Such changes to applicable statutes, regulations, and policies may change the Company’s operating environment in substantial and unpredictable ways, increase the Company’s cost of conducting business, impede the efficiency of internal business processes, subject the Company to increased supervision activities and disclosure and reporting requirements, and restrict or expand the activities in which the Company may engage. Accordingly, such changes may have a significant influence on our operations and activities, financial condition, results of operations, growth plans or future prospects, and the overall growth and distribution of loans, investments and deposits. We cannot predict whether or in what form any statute, regulation or policy will be proposed or adopted or the extent to which our business may be affected by any new statute, regulation or policy.

Available Information

The Company’s website is www.eastwestbank.com . The Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Proxy Statements, Current Reports on Form 8-K, amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, and other filings with the SEC are available free of charge at http://investor.eastwestbank.com under the heading “SEC Filings,” as soon as reasonably practicable after the Company electronically files such material with, or furnishes it to, the SEC. These reports are also available on the SEC’s website at www.sec.gov . In addition, the Company’s Code of Conduct, Corporate Governance Guidelines, charters of the Audit Committee, Compensation and Management Development Committee, Executive Committee, Risk Oversight Committee (“ROC”) and Nominating/Corporate Governance Committee, and other corporate governance materials are available on the Investor Relations section of the Company’s website. The information contained on the Company’s website as referenced in this report is not part of this report.

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Stockholders may also request a copy free of charge of any of the above-referenced reports and corporate governance documents by writing to: Investor Relations, East West Bancorp, Inc., 135 N. Los Robles Avenue, 7th Floor, Pasadena, California 91101; by calling (626) 768-6000; or by sending an e-mail to InvestorRelations@eastwestbank.com.

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ITEM 1A.  RISK FACTORS

We, like other financial institutions, face numerous risks inherent to our business, results of operations, and financial condition, many of which are beyond our control. The risk factors described below relate to known risks that could materially impact our business, results of operations, financial condition and the outcome of any matter as to which forward-looking statements contained in this Form 10-K are made. Although these risks are organized by headings and each risk is discussed separately, many are interrelated. In addition, there may be additional risks and uncertainties that may materially impact us in an adverse manner that are not presently known, that are not currently believed to be significant, or that are common to all businesses.

Risks Related to Geographic and Political Uncertainties

Unfavorable general economic, market, political or industry conditions, either domestically or internationally, may adversely affect our business, results of operations, and financial condition.

Our business and results of operations are affected by the financial markets and general economic conditions globally, particularly in the U.S. and Asia, including factors such as the level and volatility of short- and long-term interest rates, inflation, deflation, residential and commercial property prices, collateral asset prices, unemployment and under-employment levels, rental rates and occupancy levels, market or supply chain disruption, labor shortages, bankruptcies, household income, consumer behavior, fluctuations in both debt and equity capital markets and currencies, liquidity of the global financial markets, the availability and cost of capital and credit, government spending and the federal debt ceiling, investor sentiment and confidence in the financial markets, and sustainability of economic growth in the U.S. and Asia. The deterioration of any of these conditions could adversely affect our consumer and commercial business, securities and derivatives portfolios, the level of charge-offs and provision for credit losses, the carrying value of deferred tax assets, capital levels, liquidity, and results of operations. In addition, because our operations and the collateral securing our real estate lending portfolio are primarily concentrated in California, we may be particularly susceptible to adverse economic conditions in California. Any unfavorable economic, market, political, or industry conditions in California and other regions where we operate could lead to the following outcomes, among others:
• greater than expected losses in our credit exposure due to unforeseen economic conditions, which may, in turn, adversely impact our results of operations and financial condition;
• failure of our borrowers to make timely repayments of their loans, or a decrease in the value of real estate or other collateral securing the payment of such loans, which could result in credit losses, delinquencies, foreclosures and customer bankruptcies, and in turn have a material adverse effect on our results of operations and financial condition;
• a decrease in deposit balances and in the demand for loans and other products and services;
• disruptions in the capital markets or other events, including adverse actions by rating agencies and deteriorating investor expectations, which may result in an inability to borrow on favorable terms or at all from other financial institutions;
• an adverse effect on the value of the debt securities portfolio as a result of debt defaults; and
• a loss of confidence in the financial services industry, our market sector and the equity markets by investors, placing pressure on our stock price.

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We face risks associated with international operations.

A substantial number of our customers have economic and cultural ties to Asia. The Bank’s international presence includes locations in Hong Kong, China and Singapore. Our presence in Asia carries certain risks, including risks relating to our ability to generate revenues from foreign operations and to leverage and conduct business on an international basis, due to legal, regulatory, and tax requirements and restrictions, including restrictions relating to transactions involving access to certain data by persons outside of the U.S.; tariffs, trade barriers, or other trade restrictions; uncertainties regarding liability; difficulties in staffing and managing foreign operations; political and economic risks; and financial risks including currency and payment risks. For example, economic trade and political tensions, including tariffs and other punitive trade policies and disputes between the U.S. and other countries pose a risk to our business and customers. During 2025, the U.S. significantly increased tariffs on various trading partners, however, some of these tariffs were subsequently reversed or reduced. The timing and scope of future policy shifts remain uncertain. The imposition of tariffs, retaliatory tariffs, export controls or other trade restrictions on products, materials or other goods that our customers import or export could impact prices, reduce demand, or otherwise negatively impact our customers’ businesses and their ability to service debt. We may also experience a decrease in the demand for loans and other financial products or a deterioration in the credit quality of the loans extended to customers in industry sectors that are most sensitive to the trade restrictions.

Further, a downturn in economic growth, or in stock or real estate markets in Asia, among other things, may negatively impact asset values and the profitability and liquidity of our customers operating in that region. These risks could adversely affect the success of our international operations and could have a material adverse effect on our overall business, results of operations, and financial condition. In addition, we face risks that our employees and affiliates may fail to comply with applicable U.S. and foreign laws and regulations governing our international operations, including the U.S. Foreign Corrupt Practices Act and other anti-corruption laws. Failure to comply with such laws and regulations could, among other things, result in enforcement actions and fines against us, limitations on our conduct and reputational harm, any of which could have a material adverse effect on our business, results of operations and financial condition. Changes in such laws and regulations, regulatory oversight, foreign exchange controls, tariffs, or geopolitical conflict also may adversely impact our international operations.

Natural disasters, the effects of climate change and geopolitical events beyond our control could adversely affect our business, results of operations, and financial condition.

Natural disasters such as wildfires, earthquakes, extreme weather conditions, hurricanes, floods, droughts, widespread health emergencies or pandemics and other acts of nature, and geopolitical events involving political unrest, terrorism, or military conflicts have in the past, and may in the future, cause substantial damage and loss to real and personal property. These events can seriously harm our customers and adversely affect our business operations, including by impairing borrowers’ ability to service their loans, decreasing the level and duration of deposits by customers, eroding the value of loan collateral, or resulting in an increase in nonperforming assets, net charge-offs, and provision for credit losses. In addition, natural disasters and geopolitical events could also create macroeconomic challenges such as supply-chain shortages, volatile energy prices, tightened monetary policy and inflation, and economic instability, and otherwise cause a material adverse effect on our business, results of operations and financial condition.

Climate change also presents physical risks to us and our customers, including from discrete weather events, changing climate patterns and other disruptions, as well as transition risks of a shift to a low-carbon economy, including changes in policies, regulations, technologies, consumer sentiment and preferences. Regulatory changes regarding climate risk management and practices may result in higher regulatory and compliance risks and costs. Our reputation and client relationships may be damaged as a result of our practices related to climate change, including our direct or indirect involvement in, or decision not to participate in, certain industries or projects associated with causing climate change, as well as any decisions to conduct or change our activities in response to climate change considerations. Our ability to attract and retain employees may also be harmed if our response to climate change is perceived to be ineffective or insufficient. These climate-driven changes could materially and negatively impact our and our customers’ business, results of operations, financial condition and reputation.

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Risks Related to Financial Matters

A significant portion of our loan portfolio is secured by real estate and at a higher degree of risk from a downturn in real estate markets.

Since many of our loans are secured by real estate, a decline in the real estate markets could impact our business and financial condition. Real estate values and real estate markets are generally affected by changes in general economic conditions and employment levels, fluctuations in interest rates, the availability of loans to potential purchasers and the availability and demand for types of real property investments, changes in tax laws and other governmental statutes, regulations and policies, and natural disasters, such as wildfires and earthquakes, which are particularly prevalent in California, where a significant portion of our real estate collateral is located. If real estate values decline, the value of real estate collateral securing our loans could be significantly reduced. Our ability to recover on defaulted loans by foreclosing and selling the real estate collateral would be further diminished, and we would be more likely to suffer losses on defaulted loans. Furthermore, commercial real estate (“CRE”) loans typically involve larger balances to single borrowers or groups of related borrowers. Payments on these loans are often dependent on the successful operation or management of the properties, as well as the business and financial condition of the borrowers. Repayment of such loans may be subject to adverse conditions in the real estate market such as declining property values, rising interest rates, higher vacancy rates or tenant defaults, adverse economic conditions, shifts in demand for different types of properties, or changes in applicable government regulations. Borrowers’ inability to repay such loans may have an adverse effect on our business, results of operations and financial condition.

Our business is subject to interest rate risk and variations in interest rates may have a material adverse effect on our financial performance.

Our financial results depend substantially on net interest income, which is the difference between the interest income we earn on interest-earning assets and the interest expense we pay on interest-bearing liabilities. Interest-earning assets primarily include loans extended, securities held in our investment portfolio, and excess cash held to manage short-term liquidity. We fund our assets using deposits and borrowings. We offer interest-bearing deposit products, and a portion of our deposit balances are from noninterest-bearing products. We also enter into interest rate derivatives to manage interest rate risk exposure. The interest rates we receive on our interest-earning assets and pay on our interest-bearing liabilities could be affected by various factors, including macroeconomic challenges, Federal Reserve policies, market interest rate changes in response to inflation, competition, regulatory requirements or a change in our product mix. Changes in key variable market interest rates, such as the federal funds, national prime, or U.S. Treasury rates generally impact our interest rate spread. Because of the differences in maturities and repricing characteristics of our interest-earning assets and interest-bearing liabilities, changes in interest rates do not produce equivalent changes in interest income earned on interest-earning assets and interest expense paid on interest-bearing liabilities. Rising interest rates may cause our funding costs to increase at a faster pace than the yield we earn from our assets, which would cause our net interest margin to decrease. Higher interest rates may also result in lower loan production and increased charge-offs in certain segments of our loan portfolio. Falling interest rates may put negative pressure on net interest margin if interest-earning assets reprice faster than interest-bearing liabilities. Declining interest rates could also lead to higher loan refinancing activity, which, in turn, would increase the likelihood of prepayments of loans and mortgage related securities. Changes in interest rates also impact the value of our investments in debt securities, particularly debt securities with longer maturities. Accordingly, changes in levels of interest rates could materially and adversely affect our net interest income, net interest margin, cost of deposits, loan origination volume, average loan portfolio balance, asset quality, liquidity, and overall profitability.

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Inflation can have an adverse impact on our business and on our customers.

Inflation results in the value of assets or income from investments being worth less in the future due to a decrease in the value of money. Interest rates are likely to be higher during periods of elevated inflation and, together, these factors typically cause the value of our investment securities, particularly those with longer maturities, to decrease, although this effect is less pronounced for floating rate instruments than for fixed-rate instruments. Prolonged periods of inflation also may impact our profitability by negatively impacting our costs and expenses, including increasing funding costs and expenses related to talent acquisition and retention, and negatively impacting the demand for our products and services. Moreover, our customers are also affected by inflation and the rising costs of goods and services used in their households and businesses, which could have a negative impact on their ability to repay their loans. Adverse changes in inflation and interest rates could negatively impact consumer and business confidence, and adversely affect the economy as well as our business, results of operations and financial condition.

The monetary policies of the federal government and its agencies could have a material adverse effect on our earnings.

The Federal Reserve Board regulates the supply of money and credit in the U.S. Its policies determine in large part the cost of funds for lending and investing and affect the return earned on those loans and investments, both of which in turn affect our net interest margin. It can also materially decrease the value of financial assets we hold. Federal Reserve policies may also adversely affect borrowers, potentially increasing the risk that they may fail to repay their loans, or could adversely create asset bubbles resulting from prolonged periods of accommodative policy. This, in turn, may result in volatile markets and rapidly declining collateral values. Changes in Federal Reserve personnel and policies are beyond our control. Consequently, the impact of these changes on our business, results of operations and financial condition is difficult to predict. While we monitor and manage exposure to changes in monetary policy through asset liability management and risk mitigation strategies, there can be no assurance that shifts in monetary policy, including as a result of the appointment of a new Chairman of the Federal Reserve, will not adversely affect our business, results of operations, and financial condition.

Further downgrades of the U.S. credit rating, potential automatic spending cuts or government shutdowns could negatively impact our business, results of operations and financial condition.

Over the past few years, U.S. debt ceiling and budget deficit concerns have increased the possibility of U.S. government shutdowns, automatic spending cuts, additional U.S. credit rating downgrades and economic slowdowns, or a recession in the U.S. As the federal debt level rises and interest rates remain at elevated levels, the cost of servicing the debt may increase and the perceived creditworthiness of the U.S. government may decrease. The impact of any further downgrades to the U.S. government’s sovereign credit rating or its perceived creditworthiness could adversely affect the U.S. and global financial markets and economic conditions. Adverse political and economic conditions could have an adverse effect on our business, results of operations and financial condition.

We are subject to fluctuations in foreign currency exchange rates.

Our foreign currency translation exposure derives, in part, from our China subsidiary that has its functional currency denominated in Chinese Renminbi (“RMB”). In addition, as we continue to expand our cross-border business, we have a higher volume of customer transactions in foreign currencies. We have entered into derivative instruments to offset some of the impact of foreign exchange fluctuations. However, given the volatility of exchange rates, there is no assurance that we will be able to effectively manage foreign currency translation risk. Fluctuations in foreign currency exchange rates could have a material unfavorable impact on our net income, therefore adversely affecting our business, results of operations, and financial condition.

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Risks Related to Our Capital Resources and Liquidity

As a regulated entity, we are subject to capital requirements, and failure to meet these standards could adversely affect our financial condition.

We and the Bank are subject to certain capital and liquidity rules, including the Basel III Capital Rules, which establish the minimum capital adequacy requirements and may require us to increase our regulatory capital levels and/or targets even in the absence of actual adverse economic conditions or forecasts, and enhance capital planning based on hypothetical future adverse economic scenarios. As of December 31, 2025, we met the requirements of the Basel III Capital Rules, including the capital conservation buffer. Compliance with capital requirements may limit capital-intensive operations and increase operational costs, and we may be limited or prohibited from distributing dividends or repurchasing our stock. This could adversely affect our ability to expand or maintain present business levels, which may adversely affect our business, results of operations and financial condition. Additional information on the regulatory capital requirements applicable to us and the Bank is set forth in Item 1. Business — Supervision and Regulation — Regulatory Capital Requirements in this Form 10-K.

As a holding company, we depend on dividends and distributions from the Bank for our liquidity.

We derive most of our cash flow from dividends paid by the Bank. These dividends are the primary source from which we pay dividends on our common stock and principal and interest on our debt obligations. Various federal and California laws and regulations, as well as regulatory expectations, limit the amount of dividends that the Bank may pay to us. See Item 1. Business — Supervision and Regulation — Dividends and Other Transfers of Funds in this Form 10-K for a discussion of regulatory requirements applicable to dividends by us and the Bank. Although we have historically declared cash dividends on our common stock, we are not required to do so and there may be circumstances under which we would reduce or eliminate our common stock dividend in the future. This could adversely affect the market price of our common stock.

We are subject to liquidity risk, which could negatively affect the level or cost of our funding.

Market conditions or other events could negatively affect the level of or cost of funding, which in turn could affect our ongoing ability to accommodate liability maturities and deposit withdrawals, meet contractual obligations, or fund asset growth and new business initiatives at a reasonable cost, in a timely manner and without adverse consequences. Although we have implemented strategies to maintain sufficient and diverse sources of funding to accommodate planned, as well as unanticipated changes in assets, liabilities, and off-balance sheet commitments under various economic conditions, a substantial, unexpected or prolonged change in the level or cost of liquidity could have a material adverse effect on our business, results of operations, and financial condition. If the cost effectiveness or the availability of supply in the credit or wholesale funding markets is reduced for a prolonged period of time, our funding needs may require us to access funding and manage liquidity by other means. These alternatives may include generating client deposits, securitizing or selling loans, and further managing loan growth and investment opportunities. These alternative means of funding may not be available under stressed market conditions or realized in a timely fashion.

Any downgrades in our credit ratings could have a material adverse effect on our liquidity, cost of funding, cash flows, business, results of operations and financial condition.

Credit rating agencies evaluate us regularly, and their ratings are based on several factors, including our financial strength, capital adequacy, liquidity, asset quality and ability to generate earnings. Some of these factors are not entirely within our control, including conditions affecting the financial services industry as a whole. Severe downgrades in our credit ratings could impact our business and reduce our profitability in different ways, including a reduction in our access to capital markets, triggering additional collateral or funding obligations which could negatively affect our liquidity. In addition, our counterparties, as well as our clients, rely on our financial strength and stability and evaluate the risks of doing business with us on a regular basis. A decline in our credit ratings could result in a decrease in the number of counterparties and clients who may be willing to transact with us. Our borrowing costs may also be affected by various external factors, including market volatility and concerns or perceptions about the financial services industry. There can be no assurance that we can maintain our credit ratings nor that they will not be changed in the future.

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The proportion of our deposit account balances that exceed FDIC insurance limits may expose us to enhanced liquidity risk.

Deposits that exceed applicable FDIC insurance limits, and the possibility of the withdrawal of such deposits over a short period of time, pose a liquidity risk and have been a source of instability in the banking system during prior periods of stress. The ease and speed of the electronic withdrawals may increase this risk. If a significant portion of our deposits were to be withdrawn within a short period of time such that additional sources of funding would be required to meet withdrawal demands, we may be unable to obtain funding at favorable terms, which may have an adverse effect on our net interest margin. Moreover, obtaining adequate funding to meet our deposit obligations may be more challenging during periods of elevated interest rates and financial industry instability. Our ability to attract depositors during a time of actual or perceived distress or instability in the marketplace may be limited. Further, interest rates paid for borrowing generally exceed the interest rates paid on deposits. This spread may be exacerbated by higher prevailing interest rates. In addition, because our available-for-sale (“AFS”) debt securities lose value when interest rates rise, our ability to cover liquidity needs from sale or pledging of these securities may be negatively impacted during periods of elevated interest rates. Under these circumstances, we may be required to access additional funding from other sources in order to manage our liquidity risk.

Risks Related to Credit Matters

Our allowance for credit losses may not be adequate to cover actual losses.

We establish an allowance for credit losses in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), which includes the allowance for loan and lease losses (“ALLL”) and the reserve for unfunded credit commitments. Our ALLL is based on our evaluation of risks associated with our loans held-for-investment portfolio, including historical loss experience, current borrower characteristics, current economic conditions, reasonable and supportable forecasts of future economic conditions, delinquencies, performing status, the size and composition of the loan portfolio, and concentrations within the portfolio. The allowance estimation process requires subjective and complex judgments, including analysis of economic conditions and how these economic conditions might impair the ability of our borrowers to repay their loans. Unexpected changes in economic, market, operating and other conditions in the U.S. and in the international markets could result in, among other things, greater than expected deterioration in credit quality of our loan portfolio or in the value of collateral securing these loans. Due to the inherent risk associated with accounting estimates, our ALLL and our reserve for losses associated with our unfunded credit commitments, which is determined using a similar methodology as that used to establish our ALLL, may not be adequate to absorb actual losses, and future provisions for such losses could have a material adverse effect on our business, results of operations, and financial condition.

We may be subject to increased credit risk and higher credit losses to the extent our loans are concentrated by loan type, industry segment, borrower type, or location of the borrower or collateral.

Our credit risk and credit losses can increase if our loans are concentrated in borrowers engaged in the same or similar activities, industries, or geographies or to borrowers who as a group may be uniquely or disproportionately affected by economic or market conditions, which could result in materially higher credit losses. For example, the Bank has a concentration of real estate loans in California. Potential deterioration in the California commercial or residential real estate markets or economic conditions could result in additional loan charge-offs and provision for loan losses, which could have a material adverse effect on our business, results of operations, and financial condition. If any industry, market sector, or collateral type were to experience economic difficulties, loan collectability from customers operating in those industries or sectors or holding such collateral types may deteriorate, which could have a material adverse impact on our business, results of operations, and financial condition.

A portion of our lending portfolio is made to non-depository financial institutions to fund their lending activities. Adverse conditions affecting these entities or broader market conditions could result in increased credit risk to us. In addition, a downturn in sectors served by these institutions could increase credit risk to us and negatively impact our business, results of operations, and financial condition.

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Risks Related to Our Operations

A cyber-attack, information or security breach, or failure of our operational or security systems or infrastructure, or those of third-party vendors, could disrupt our business, and adversely impact our results of operations, financial condition, cash flows, and liquidity, as well as damage our reputation.

Our business is highly dependent on the security and efficacy of our infrastructure, computer, network and data management systems, as well as those of third parties with which we interact. We face risks of loss resulting from, but not limited to, errors relating to transaction processing and technology, breaches of our internal control system or external compliance requirements, fraud or unauthorized transactions by employees or third parties, cybersecurity incidents, ineffective business continuation and disaster recovery activities. The potential for operational loss exposure exists throughout our organization and among our interactions with third parties, and is expected to increase as we expand our interconnectivity with our customers and other third parties. Any of these operational risk exposures, if realized, could adversely impact our results of operations, financial condition, cash flows, and liquidity, and result in regulatory action, significant litigation exposure and harm to our reputation.

Our ability to process transactions, provide service and conduct our business may be adversely affected by significant disruptions to us or our vendors, which can be caused by events that are wholly or partially beyond our control. These events include, and are not limited to, electrical, telecommunications, networking or other major physical infrastructure outages, cybersecurity incidents, pandemics, natural disasters, and political or social events, including terrorist acts, wars and civil disturbances. We have taken measures to implement backup systems and safeguards and frequently update our systems to support our operations and growth, requiring significant costs and creating risks associated with implementing and integrating new systems. To date, we have not experienced any known cybersecurity incidents resulting in a material impact on our business, financial condition, or operating results. However, we can provide no assurance that all of our security measures will be effective.

Third parties that facilitate our business activities could also be sources of operational and security risks to us. Our ability to implement backup systems or other safeguards with respect to third-party systems is limited. Furthermore, an attack on or failure of a third-party system may not be revealed to us in a timely manner, which could compromise our ability to respond effectively. Some third parties may engage vendors of their own, which introduces the risk that these “fourth parties” could be the source of operational and security failures. If a third party or fourth party with access to the customer account data on our systems experiences a breach or misappropriates such data, we and our customers could suffer material harm, including heightened risk of fraudulent transactions, losses from fraudulent transactions, increased operational costs to remediate any security breach, and reputational harm.

Cybersecurity risks, including ransomware, malware, social engineering, and phishing attacks, for financial institutions have significantly increased in recent years in part because of the proliferation of new technologies, the use of the internet and telecommunication technologies to conduct financial transactions, the significant increased use of remote workstations by employees in recent years, and the increased sophistication and activities of organized crime, hackers, terrorists, nation-states, and other threat actors. Our business and many of our customers may have experienced, and may experience again in the future, losses incurred due to fraud or theft related to customers, employees or third parties. These losses may negatively affect our business, results of operations, financial condition, reputation and prospects. We have limited ability to assure the safety and security of our customers’ transactions with us to the extent our customers are using their own devices or are a victim of cyberattacks, fraud or other scams by threat actors. Failure to mitigate breaches of security, or to comply with increasingly demanding new and changing industry standards and regulatory requirements could also result in violation of applicable privacy laws, reputational damage, regulatory fines, litigation exposure, increased security compliance costs, and could have an adverse effect on our business, results of operations and financial condition.

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Failure to keep pace with technological change could adversely affect our business. We may face risks associated with the utilization of information technology systems to support our operations effectively.

The financial services industry is continuously undergoing rapid technological change with frequent introductions of new technology-driven products and services, including recent rapid developments in artificial intelligence. The effective use of technology increases efficiency and enables financial institutions to better serve customers and to reduce costs. Our future success depends, in part, on our ability to address the needs of our customers by using technology to provide products and services that will satisfy customer demands, as well as to create additional efficiencies in our operations. Many of our competitors have substantially greater resources to invest in technological solutions. We may not be able to effectively implement new technology-driven products and services or be successful in marketing these products and services to our customers, and our efforts to use technological developments to improve the efficiency of our operations may not be effective or may lag our competitors. Failure to successfully keep pace with technological change affecting the financial services industry could have a material adverse impact on our business and, in turn, our results of operations and financial condition. In addition, if we do not implement systems effectively or if our outsourcing business partners do not perform their functions properly, there could be an adverse effect on us. There can be no assurance that we will be able to effectively maintain or improve our systems and processes, or utilize outsourced talent, to meet our business needs successfully. Any such failure could adversely affect our business, results of operations, financial condition and reputation.

We may be impacted by the actions, soundness or creditworthiness of other financial institutions, which can cause disruption within the industry and increase expenses.

Financial services institutions are interrelated as a result of trading, clearing, counterparty, or other relationships. We execute transactions with various counterparties in the financial industry, including broker-dealers, commercial banks, and investment banks. Defaults or failures of financial services institutions and instability in the financial services industry in general can lead to market-wide liquidity problems, increased credit risk and withdrawals of uninsured deposits. Such events could adversely affect our business, results of operations, and financial condition, as well as the market price and volatility of our common stock.

Bank failures may increase the risk of a recession or lead to regulatory changes and initiatives, such as enhanced capital, liquidity, or risk management requirements, which could adversely impact us. Changes to laws or regulations, or the imposition of additional restrictions through supervisory or enforcement activities, could have a material impact on our business. Regulatory changes could also adversely impact our ability to access funding, increase the cost of funding, limit our access to capital markets, and negatively impact our overall financial condition. The 2023 bank failures also resulted in a special assessment by the FDIC to replenish the DIF, which has increased our deposit insurance costs.

Our enterprise risk management program, and our controls and procedures, may not be effective at mitigating the risks to which we are subject, based upon our size, scope, and complexity.

We have established corporate governance and enterprise risk management policies and procedures intended to identify, measure, monitor, report, and analyze the types of risk to which we are subject, including capital, market, liquidity, credit, operational, compliance, legal, strategic, technology and reputational risks. Although we seek to manage our exposure to such risks, and employ a broad and diverse set of risk monitoring and mitigation techniques in the process, including internal controls and disclosure controls and procedures, those techniques are inherently limited because they cannot anticipate the existence or development of risks that are currently unknown or unanticipated. Any system of control and any system to reduce risk exposure, however well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the system are met. Further, in some cases we use analytical or forecasting models in our management of risks. If the models are inadequate, or are subject to ineffective governance, our risk management program may also prove ineffective. Actions taken to mitigate identified risks may prove less effective than anticipated. If our risk management program proves ineffective, we could suffer unexpected losses and reputational damage.

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We are dependent on key personnel and the loss of one or more of those key personnel may materially and adversely affect our prospects.

Competition for qualified personnel in the banking industry is intense and there is a limited number of qualified people with knowledge of, and experience in, the regional banking industry, especially in the West Coast markets, and in international banking operations, especially in Asia. The process of recruiting personnel with the combination of skills and attributes required to carry out our strategies is often lengthy. The labor market is currently challenging, with high employee turnover and increased wage pressure. In addition, the proliferation of hybrid work environments may exacerbate the challenges of attracting and retaining talented employees as job markets may be less constrained by physical geography. Our success depends, to a significant degree, on our ability to attract and retain highly-skilled and qualified personnel, as well as the continued contributions of those individuals. In particular, our success has been and continues to be highly dependent upon the abilities of certain key executives. Accordingly, we believe that our future success is dependent upon the development and, when needed, implementation of adequate succession plans. Although both the Board of Directors and management monitor our succession planning for our senior management team, the loss of key personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on our business, financial condition, and operating results.

We face strong competition in the financial services industry, and we could lose business or suffer margin declines as a result.

We operate in a highly competitive environment. Our competitors include, but are not limited to, commercial banks, savings and loan associations, finance companies, brokerage firms, insurance companies, credit unions, mortgage banks, nonbank financial institutions, and other regional, national, and global financial institutions. Some of our major competitors include multinational financial service companies whose greater resources may afford them a marketplace advantage by enabling them to maintain numerous locations and mount extensive promotional and advertising campaigns. Areas of competition include interest rates on loans and deposits, customer service, and range of price and quality of products and services, including new technology-driven products and services. We also face competition from products outside of the traditional finance system, such as stablecoins. The enactment of the GENIUS Act in July 2025 has the potential to accelerate stablecoin adoption. If consumers and businesses shift to stablecoins for payments and liquidity management, we may face reduced demand for our traditional products. Ongoing or increased competition may put pressure on the pricing for our products and services or may cause us to lose market share, particularly with respect to traditional banking products such as loans and deposits. Failure to attract and retain banking customers may adversely impact our loan and deposit growth and in turn, our revenues.

We have engaged in and may continue to engage in further expansion through acquisitions, which could cause disruption to our business and may dilute existing stockholders’ interests.

There are risks associated with expanding through mergers and acquisitions. These risks include, among others, incorrectly assessing the asset quality of a bank acquired in a particular transaction, incurring greater than anticipated costs in integrating acquired business, failing to retain customers or employees, and the inability to profitably deploy assets acquired or realize synergies from a transaction. Additional country or region-specific risks are associated with transactions outside the U.S., including in China. To the extent we issue capital stock in connection with acquisition transactions, these transactions and related stock issuances may have a dilutive effect on our earnings per share (“EPS”) and share ownership.

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New products and services may subject us to additional risks.

From time to time, we may seek to implement new business arrangements or new lines of business or offer new products and services within existing lines of business. There are substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed. We may invest significant time and resources in developing and marketing new business arrangements, lines of business and/or new products and services. Initial timetables for the introduction and development of new business initiatives, new lines of business and/or new products or services may not be achieved, and price and profitability targets may not prove feasible, which could in turn have a material negative effect on our operating results. New business arrangements, new lines of business and/or new products or services also could subject us to additional regulatory requirements, increased scrutiny by our regulators and other legal risks. For example, we and other regional banks are increasingly partnering with fintech and other providers to distribute or market our products and services. Bank regulators have, and may in the future, hold banks responsible for the activities of these fintech companies, including in respect of BSA/AML and consumer compliance matters, or may take the view that these relationships present safety and soundness issues.

Our investments in certain tax-advantaged projects may not generate returns as anticipated, which could result in an adverse impact on our results of operations.

We invest in certain tax-advantaged investments that support qualified affordable housing projects, community development, and renewable energy resources. Our investments in these projects are designed to generate a return in part through the realization of federal and state income tax credits, and other tax benefits, over specified time periods. We are subject to the risk that previously recorded tax credits, which remain subject to recapture by taxing authorities based on compliance features required to be met at the project level, may fail to meet certain government compliance requirements and may not be able to be realized. The risk of not being able to realize, or of subsequently incurring a recapture of, the tax credits and other tax benefits depends on various factors, some of which are outside of our control, including changes in the applicable tax code, as well as the continued economic viability of the project and project operator. The OBBBA accelerated the phase‑out of many renewable energy tax credits, including solar and wind-related investment and production tax credits, which could require us to shift our tax credit investment strategy in the future. Any modification, repeal, expiration, delay or reinterpretation of applicable tax incentive regimes, or a project’s failure to satisfy evolving qualification or compliance standards, could reduce or eliminate anticipated tax benefits. The possible inability to realize these tax credits and other tax benefits would have a negative impact on our financial results.

Risks Related to Regulatory, Compliance and Legal Matters

Changes in regulation may require us to change our business practices, increase our costs, limit our ability to make investments and generate revenue, or otherwise adversely affect our business operations and/or competitiveness.

We are subject to extensive regulation under federal and state laws, as well as supervision and examinations by the DFPI, FDIC, Federal Reserve, SEC, CFPB in the U.S. and foreign regulators and other government authorities. We are also subject to enforcement oversight by the DOJ and state attorneys general. In addition, we face certain legal, reputational, and financial risks as a result of serving customers in new or evolving industries that are subject to changing, and at times conflicting laws. Changes to statutes, regulations or regulatory policies, including changes in interpretation or implementation of statutes, regulations, or policies could affect the manner in which we conduct business. Such changes could also subject us to additional costs and may limit the types of financial services and products we offer, and the investments we make. Further, as we increase in size additional regulatory requirements may become applicable to us.

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Given that banks operate in an extensively regulated environment under federal and state law, good standing with our regulators is of fundamental importance to the continuation and growth of our business. In the performance of their supervisory and enforcement duties, the U.S. federal and state regulators, and non-U.S. regulators, have significant discretion and power to initiate enforcement actions for violations of laws and regulations, and unsafe and unsound practices. Further, regulators and bank supervisors continue to exercise qualitative supervision of our industry and specific business operations and related matters. Violations of laws and regulations or deemed deficiencies in risk management or other qualitative practices also may be incorporated into our confidential bank supervisory ratings. A downgrade in these ratings, or other regulatory settlements, enforcement actions or supervisory criticisms, could impose additional risk management and other regulatory oversight requirements, limit our ability to pursue acquisitions or conduct other expansionary activities, require new or additional regulatory approvals before engaging in certain other business activities, and result in civil monetary penalties, other sanctions, and damage to our reputation, all of which could adversely affect our business, financial condition, results of operations and future prospects.

Failure to comply with laws, regulations, or policies could result in civil or criminal sanctions by U.S. federal and state, and non-U.S. agencies, the loss of FDIC insurance, the revocation of our banking charter, civil or criminal monetary penalties, and/or reputational damage, which could have a material adverse impact on our business, results of operations, and financial condition. We continue to adjust our business and operations, capital, policies, procedures, and controls to comply with these laws and regulations, final rulemaking, supervisory requirements and interpretations from the regulatory authorities. See Item 1. Business — Supervision and Regulation in this Form 10-K for more information about the regulations to which we are subject.

Changes to fiscal policies and tax legislation may adversely affect our business.

From time to time, the U.S. government may introduce new fiscal policies and tax laws or make substantial changes to existing tax legislation. These changes could have a material impact on our business and our customers’ business, results of operations, and financial condition. Our positions or our actions taken prior to such changes may be compromised by such changes. In addition, our actions taken in response to, or in reliance upon, such changes in the tax laws may impact our tax position in a manner that may result in an adverse financial condition. We also provide for current and deferred taxes in our financial statements, based on our results of operations and financial condition. We may take tax return filing positions for which the final determination of tax is uncertain, and our income tax expense could be increased if a federal, state, or local authority were to assess additional taxes that have not been provided for in our consolidated financial statements. There can be no assurance that we will achieve our anticipated effective tax rate. The U.S. government could further introduce new tax legislation or amend current tax laws in a manner that would adversely affect us.

In July 2025, the OBBBA was signed into law, introducing significant tax changes. The OBBBA extends or makes permanent various tax provisions that were originally enacted in the 2017 Tax Cuts and Jobs Act and were set to expire at the end of 2025. The OBBBA features modified versions of individual and business tax relief proposals, and other new tax relief measures. In addition, it includes various revenue-raising measures, including certain changes to the Inflation Reduction Act and various limits on business and individual tax deductions, that are intended to offset part of the cost of the legislation. We are currently evaluating the impact of the OBBBA on our business and future tax strategies.

Complying with the Bank Secrecy Act and other anti-money laundering and sanctions statutes and regulations can increase our compliance costs and risks.

The BSA, the PATRIOT Act, and other laws and regulations require us and other financial institutions to institute and maintain an effective AML program and file suspicious activity reports and currency transaction reports when appropriate. We may provide banking services to customers considered to be higher risk customers, which subjects us to greater enforcement risk under the BSA and requires us to ensure our third-party vendors adhere to the BSA and related regulations. The Financial Crimes Enforcement Network may impose significant civil monetary penalties for violations of those requirements and has been engaging in coordinated enforcement efforts with the federal and state banking regulators, as well as the DOJ, Drug Enforcement Administration, and the Internal Revenue Service.

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We are also required to comply with the U.S. economic and trade sanctions administered by the OFAC regarding, among other things, the prohibition of transacting business with, and the need to freeze assets of, certain persons and organizations identified as a threat to the national security, foreign policy, or the U.S. economy. A violation of any AML or OFAC-related law or regulation could subject us to significant civil and criminal penalties as well as regulatory enforcement actions, which may include restrictions on our ability to pay dividends and the necessity to obtain regulatory approvals to proceed with certain aspects of our business plan, including any acquisition plans. Any of these violations could have a material adverse effect on our business, results of operations, financial condition, reputation, and future prospects.

We could face material legal and reputational harm if we fail to safeguard personal information.

We are subject to complex and evolving laws and regulations, both inside and outside the U.S., governing the privacy and protection of personal information. Individuals whose personal information may be protected by law can include our customers (and in some cases our customers’ customers), prospective customers, job applicants, employees, and the employees of our suppliers, and third parties. Complying with laws and regulations applicable to our collection, use, transfer, and storage of personal information can increase operating costs, impact the development and marketing of new products or services, and reduce operational efficiency. Any mishandling or misuse of personal information by us or a third party affiliated with us could expose us to litigation or regulatory fines, penalties or other sanctions. See Item 1. Business — Supervision and Regulation — Privacy and Cybersecurity in this Form 10-K for more information about the regulations governing customer data to which we are subject.

We are subject to significant financial and reputational risk arising from lawsuits and other legal proceedings.

We operate in a heavily regulated industry and face significant risks from lawsuits and proceedings brought by customers, borrowers, bank regulators and counterparties. These actions include claims for monetary damages, penalties, fines, and demands for injunctive relief. If these lawsuits or proceedings, whether founded or unfounded, are not resolved in a favorable manner to us, they could lead to significant financial obligations for us, as well as restrictions or changes to how we conduct our business. Although we establish accruals for legal matters when and as required by U.S. GAAP and certain expenses and liabilities in connection with such matters may or may not be covered by insurance, the amount of loss ultimately incurred in relation to those matters may be substantially higher than the amounts accrued and/or insured. As a participant in the financial services industry, we expect to continue to incur significant risks arising from litigation and government scrutiny related to our businesses and operations. Substantial legal liability and government scrutiny could adversely affect our business, results of operations, and financial condition. In addition, we may suffer significant reputational harm as a result of lawsuits and proceedings, adversely impacting our ability to attract and retain customers, employees, and investors. Moreover, it may be difficult to predict the outcome of certain legal proceedings, which may present additional uncertainty to our business prospects.

General Risk Factors

Changes in accounting standards or changes in how the accounting standards are interpreted or applied could materially impact our financial statements.

The preparation of our financial statements is based on accounting standards established by the Financial Accounting Standards Board (“FASB”) and the SEC. From time to time, these accounting standards may change, and such changes may have a material impact on our financial statements. In addition, the FASB, SEC, banking regulators, and our independent registered public accounting firm may amend or reverse their previous interpretations or positions on how various standards should be applied. These changes may be difficult to predict and could impact how we prepare and report our financial statements. In some cases, we could be required to adopt a new or revised standard retrospectively, potentially resulting in restatements to a prior period’s financial statements.

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Our consolidated financial statements are based in part on assumptions and estimates which, if incorrect, could cause unexpected losses in the future.

Pursuant to U.S. GAAP, we are required to use certain assumptions and estimates in preparing our financial statements, including in determining the allowance for credit loss, accrued liability for litigation, and the fair value of certain financial assets and liabilities, among other items. Our assumptions and estimates may be inaccurate or subjective, particularly in times of market stress or under unforeseen circumstances. Inaccurate assumptions or inadequate design of our forecasting models could result in incorrect or misleading information, and in turn could lead to inappropriate business decisions, such as an inadequate reserve for credit losses, and adversely impact our business, results of operations, and financial condition. Our significant accounting policies and use of estimates are fundamental to understanding our results of operations and financial condition. Some accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments. In addition, some significant accounting policies require significant judgments in applying complex accounting principles to individual transactions and determining the most appropriate treatment. We have procedures and processes in place to facilitate making these judgments. For a description of these policies, refer to Note 1 — Summary of Significant Accounting Policies to the consolidated financial statements and Item 7. MD&A – Critical Accounting Estimates in this Form 10-K.

Impairment of goodwill could result in a charge against earnings and thus a reduction in stockholders’ equity.

We test goodwill for impairment on an annual basis, or more frequently, if necessary. A significant decline in our expected future cash flows, a material change in interest rates, a significant adverse change in the business climate, slower growth rates, or a significant or sustained decline in the price of our common stock may necessitate taking future charges related to the impairment of goodwill. If we determine that a future write-down of goodwill is necessary, the amount of such an impairment charge could be significant and could adversely affect earnings as well as capital.

Anti-takeover provisions could negatively impact our stockholders.

Provisions of Delaware and California law and of our certificate of incorporation, as amended, and bylaws, as amended and restated, could make it more difficult for a third party to acquire control of us or could have the effect of discouraging a third party from attempting to acquire control of us. For example, our certificate of incorporation, as amended, requires the approval of the holders of at least two-thirds of the outstanding shares of voting stock to approve certain business combinations. We are also subject to Section 203 of the Delaware General Corporation Law, which would make it more difficult for another party to acquire us without the approval of the Board of Directors. Additionally, our certificate of incorporation, as amended, authorizes the Board of Directors to issue preferred stock which could be issued as a defensive measure in response to a takeover proposal.

Additionally, prior approval of the Federal Reserve and the DFPI is generally required for any person to acquire control of us, and control for these purposes may be presumed to exist when a person owns 10% or more of our outstanding common stock. Federal Reserve approval is also generally required for a bank holding company to acquire more than 5% of our outstanding common stock. These and other provisions could make it more difficult for a third party to acquire us, even if an acquisition might be in the best interest of the stockholders.

Managing reputational risk is important to attracting and maintaining customers, investors, and employees.

Threats to our reputation can come from many sources, including unethical practices, employee misconduct, failure to deliver minimum standards of service or quality, compliance deficiencies, and questionable or fraudulent activities of our customers or other threat actors. We have policies and procedures, including our Code of Conduct, in place to govern the personal conduct, action and work relationship of our employees with customers, fellow employees, competitors, governmental officials, and suppliers under both official and unofficial situations, in which employees may reasonably be perceived by others as acting as representatives of us. In addition, employees who fail to comply with the Code of Conduct may be subject to disciplinary action, termination of employment, and/or prosecution. However, these policies and procedures may not be fully effective. Negative publicity regarding our business, employees or customers, with or without merit, may result in the loss of customers, investors and employees, costly litigation, a decline in revenues and increased governmental scrutiny.

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The price of our common stock may be volatile or may decline.

The price of our common stock may fluctuate in response to various factors, some of which are outside our control. These factors include the risk factors discussed herein, as well as:
• actual or anticipated quarterly fluctuations in our results of operations and financial condition;
• changes in revenue or earnings estimates or publication of research reports and recommendations by financial analysts and rating agencies;
• speculation or changes in perception in the press or investment community;
• strategic actions and announcements by us or our competitors, such as acquisitions or restructurings;
• actions by institutional stockholders;
• addition or departure of key personnel;
• fluctuations in the stock price and operating results of our competitors;
• general market conditions and, in particular, market conditions in the financial services industry;
• anticipated, proposed or adopted regulatory changes or developments;
• cyclical fluctuations;
• trading volume of our common stock; and
• anticipated or pending investigations, proceedings or litigation that involve or affect us.

Industry factors, general economic and political conditions and events, such as cybersecurity incidents or terrorist attacks, economic downturn or recessions, interest rate changes, credit default trends, currency fluctuations, changes to fiscal, monetary or trade policies, or public health issues could also cause our stock price to decline regardless of our operating results. A significant decline in our stock price could result in substantial losses for stockholders.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 1C. CYBERSECURITY

Risk Management and Strategy

The Company maintains an Information Security Program to support the management of cybersecurity risk as an integral component of the Company’s enterprise risk management (“ERM”) framework. The Information Security Program encompasses the Company’s cybersecurity policies and practices, which focus on prevention, detection, mitigation and recovery from cybersecurity incidents. In addition, as part of the Information Security Program, the Company has a Security Incident Response Policy and Plan to enable a coordinated response to protect the integrity, security and resiliency of the Company’s information systems, to mitigate the risk of cybersecurity incidents and to escalate information regarding certain cybersecurity incidents to the appropriate management personnel and Board members in a timely fashion. The Information Security Program follows the Cyber Risk Institute Profile, which is a framework aligned with regulatory expectations for managing cyber risk in financial institutions.

The Information Security Program is supported by our three lines of defense model of risk management. The Information Security Team is the first line of defense under the Chief Information Security Officer and provides day-to-day cybersecurity operations including identification and reporting of internal and external threats, access control, data security, protective controls, detection of malicious or unauthorized activity, incident response, recovery planning, performance of vulnerability and third party information security assessments, and employee awareness and training programs. In addition, the Information Security Team works in coordination with the individual business lines that have direct and primary responsibility and accountability for identifying, controlling and monitoring cybersecurity risk embedded in their business activities.

30

The Information Security Team uses industry service providers for security operations, monitoring, investigation and incident response, and the Bank also conducts periodic assessments in collaboration with consulting firms with cybersecurity domain expertise. As the second line of defense, the ERM Team under the Chief Risk Officer independently monitors the cybersecurity risk framework across the Company, as well as the effectiveness of the Information Security Program, and third party vendors’ vulnerability and penetration tests against the Company’s network. Furthermore, the Third-Party Risk Management Team, in conjunction with the ERM Team and the Information Security Team, oversees, identifies, monitors, investigates and addresses material risks from cybersecurity threats associated with the Company’s use of third-party service providers. The Third-Party Risk Management Team is also part of the independent risk management function of the Bank and included in the second line of defense. The ERM Team reports the status of the annual assessment of the effectiveness of the Information Security Program to the Chief Risk Officer, who reports to the Board’s ROC. When applicable, the Company obtains Statement on Standards for Attestation Engagement No. 18 reports or equivalent reports for vendor products and services hosted by third parties. Internal Audit serves as the third line of defense and provides additional independent assurance and evaluates the effectiveness of cybersecurity risk management. In addition, the Company regularly engages independent external assessors to perform assessments of its cybersecurity control environment and operating effectiveness.

In addition, the Company uses several internal training methods, through annual mandatory courses on security and privacy for all employees, as well as multiple simulated phishing attacks and regularly providing information security awareness materials throughout the year. The Company also maintains cybersecurity insurance.

Board Oversight

The Board’s ROC has primary oversight responsibility for management’s efforts to mitigate cybersecurity risk and respond to cybersecurity incidents. The ROC receives quarterly cybersecurity reports, including any reportable incidents, and reviews and approves the Information Security Program at least annually or whenever significant changes are made to the program. These updates include information regarding management’s ongoing efforts to manage cybersecurity risk and the steps management has taken to address and mitigate the evolving cybersecurity threat environment. The ROC members include independent directors from the Board who have expertise in areas relevant to their responsibilities over cybersecurity, including senior leadership experience in financial services and information technology.

Role of Management

At the management level, the Information Technology Steering Committee has overall responsibility for identifying, assessing, and managing information security risks, including cybersecurity risk. The Information Technology Steering Committee provides cybersecurity reports periodically to the ROC and is comprised of the Company’s senior information technology, information security and third party risk management leaders, including the Chief Risk Officer and Chief Information Security Officer. The Chief Risk Officer is responsible for managing cybersecurity risk and coordinating with the Chief Information Security Officer to ensure the Company’s cybersecurity risk profile is managed in a manner consistent with its risk appetite. The Chief Risk Officer also provides periodic reports to the Board’s ROC, outlining the overall status of the Company’s Information Security Program and its compliance with regulatory guidelines, and coordinating and reporting on incident response. The Chief Information Security Officer is responsible for the day-to-day management of the Information Security Program and Security Incident Response Policy and Plan. The Chief Risk Officer has held various leadership roles at the bank, including over 13 years previously serving as the Company’s Chief Financial Officer. The Chief Information Security Officer has over 25 years of work experience in technology and cybersecurity at financial institutions. The majority of Information Security Team members have over 10 years of cybersecurity experience and cumulatively hold over 80 active professional certifications in related fields.

Material Cybersecurity Threat Risk

To date, the Company has not experienced any known cybersecurity incidents that have materially affected its business strategy, results of operations or financial condition. However, we can provide no assurance that all of our security measures will be effective. For additional information regarding cybersecurity threats, please refer to Item 1, Business – Supervision and Regulation – Privacy and Cybersecurity and Item 1A, Risk Factors – Risks Related to Our Operations .

31

ITEM 2. PROPERTIES

East West’s corporate headquarters is located at 135 North Los Robles Avenue, Pasadena, California, an eight-story office building, of which it owns 50%. The Company operates in 20 owned and over 90 leased locations in the U.S. and Asia. In the U.S., the Bank’s main operations and administrative offices are located in Southern California. All properties occupied by the Bank are available to be used across all business segments and for corporate purposes.

The Company believes that its facilities are adequate and suitable for its business needs. It evaluates its current and projected space needs and may determine that certain premises or facilities are no longer necessary for its operations. The Company believes that, if necessary, it could secure alternative properties on similar terms without adversely affecting its operations.

ITEM 3. LEGAL PROCEEDINGS

See Note 12 — Commitments and Contingencies — Litigation to the Consolidated Financial Statements in this Form 10-K, which is incorporated herein by reference.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.
32

PART II  

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information, Holders of Common Stock and Dividends

The Company’s common stock is traded on the Nasdaq Global Select Market under the symbol “EWBC”. As of January 31, 2026, the Company had 652 stockholders of record of the Company’s common stock. The actual number of stockholders is greater than this number of record holders and includes stockholders who are beneficial owners but whose shares are held in street name by banks, brokers and other nominees.

A discussion of dividend restrictions is set forth in Item 1. Business — Supervision and Regulation — Dividends and Other Transfers of Funds and Note 16 — Regulatory Requirements and Matters to the Consolidated Financial Statements in this Form 10-K. For information regarding dividends, see Item 7. MD&A — Balance Sheet Analysis — Capital in this Form 10-K.

Securities Authorized for Issuance under Equity Compensation Plans

For information regarding securities authorized for issuance under the Company’s equity compensation plans, see Note 13 — Stock Compensation Plans to the Consolidated Financial Statements and Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters in this Form 10-K.

Five-Year Stock Performance

The following graph and table compare the Company’s five-year cumulative total return on its common stock with the cumulative total return of the Standard & Poor’s (“S&P”) 500 Index and the Keefe, Bruyette & Woods Nasdaq Bank Index (“BKX Index”). The cumulative total shareholder return assumes the investment of $100 in the Company’s common stock and in each index on December 31, 2020 and the reinvestment of common stock dividends. The returns shown are based on historical results and are not intended to suggest future performance.

The S&P 500 Index is utilized as a benchmark against performance and is a commonly referenced U.S. equity benchmark consisting of leading companies from different economic sectors. The BKX Index is designed to track the performance of the leading banks and thrifts that are publicly-traded in the U.S., and comprises 24 banking stocks representing the large U.S. national money centers, regional banks and thrift institutions.

December 31,
Index 2020 2021 2022 2023 2024 2025
East West Bancorp, Inc. $100.00 $157.99 $135.17 $152.37 $211.44 $254.35
BKX Index
$100.00 $128.71 $105.40 $133.10 $166.40 $196.16
S&P 500 Index $100.00 $138.33 $108.73 $107.76 $147.85 $196.01

Repurchases of Equity Securities by the Issuer and Affiliated Purchasers

The following table summarizes the Company’s common stock repurchase activity during the fourth quarter of 2025:

Calendar Month Total Number of Shares Purchased (1)
Average Price Paid per Share of Common Stock Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) (2)(3)

October —  $ —  —  $ 216 
November 10,428  $ 99.83  10,428  $ 215 
December —  $ —  —  $ 215 
Fourth quarter 10,428   $ 99.83   10,428  

(1) Excludes the repurchase of common stock pursuant to various stock compensation plans and agreements.
(2) Excludes excise taxes and commissions. As part of the Inflation Reduction Act of 2022, a 1% excise tax was imposed on net share repurchases effective January 1, 2023.
(3) On January 22, 2025, the Company’s Board of Directors authorized the repurchase of up to $300 million of East West stock, which will remain valid until December 31, 2026.

Refer to Item 7. MD&A — Balance Sheet Analysis — Capital and Item 8. Financial Statements — Note 14 — Stockholders’ Equity and Earnings Per Share for information regarding repurchases under the Company’s common share repurchase program.

ITEM 6. [RESERVED]
33

EAST WEST BANCORP, INC.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
TABLE OF CONTENTS

Page

Overview
35

Financial Review
36

Results of Operations
37

Net Interest Income
37

Noninterest Income
42

Noninterest Expense
43

Income Taxes
44

Operating Segment Results
44

Balance Sheet Analysis
47

Debt Securities
47

Loan Portfolio
49

Foreign Outstandings
55

Deposits
56

Capital
57

Regulatory Capital and Ratios
58

Risk Management
58

Credit Risk Management
59

Liquidity Risk Management
63

Market Risk Management
66

Critical Accounting Estimates
71

Reconciliation of GAAP to Non-GAAP Financial Measures
74

34

Overview

The following discussion provides information about the results of operations, financial condition, liquidity and capital resources of the Company, including its subsidiary bank, East West Bank. This information is intended to facilitate the understanding and assessment of significant changes and trends related to the Company’s results of operations and financial condition. This discussion and analysis should be read in conjunction with the Consolidated Financial Statements and the accompanying notes presented elsewhere in this Form 10-K. For information on our business, see Item 1. Business in this Form 10-K.

Current Economic Developments

Evolving trade policies and tariffs and recent government shutdowns raised concerns about inflation, supply chain disruptions, and slower economic growth. The uncertain business environment led to a softening in the labor market, as companies adopted more cautious hiring practices, while reduced immigration further limited labor supply. The residential mortgage and CRE markets moderated but housing affordability pressures remained elevated. The Federal Reserve, which resumed lowering interest rates in late 2025, now faces heightened policy complexity in 2026. The transition to a new Chairman of the Federal Reserve, which is expected after Chairman Jerome Powell’s term expires in May 2026, adds additional uncertainty, particularly as leadership debates continue over balancing inflation risks against labor market softening. The economic uncertainty caused by these factors could result in decreased consumer spending and curb business investments. The Company monitors changes in economic and industry conditions and their impacts on the Company’s business, customers, employees, communities and markets.

Further discussion of the potential impacts on the Company’s business due to the economic environment has been provided in Item 1A. — Risk Factors — Risks Related to Geographic and Political Uncertainties and — Risks Related to Financial Matters in this Form 10-K.

35

Financial Review

Our MD&A analyzes the financial condition and results of operations of the Company for 2025 and 2024. Some tables include additional periods to comply with disclosure requirements or to illustrate trends in greater depth. The page locations of specific sections that we refer to are presented in the table of contents. To review our financial condition and results of operations for 2024 and a comparison between 2024 and 2023 results, see Item 7. MD&A of our 2024 Form 10-K, which was filed with the SEC on February 28, 2025.

($ and shares in thousands, except per share, and ratio data) 2025 2024
Summary of operations:

Net interest income before provision for credit losses $ 2,552,629  $ 2,278,716 
Noninterest income 379,227  335,218 
Total revenue 2,931,856  2,613,934 
Provision for credit losses 160,000  174,000 

Noninterest expense 1,046,396  958,073 
Income before income taxes 1,725,460  1,481,861 
Income tax expense 400,272  316,275 

Net income $ 1,325,188  $ 1,165,586 
Per share:
Basic earnings $ 9.58  $ 8.39 
Diluted earnings $ 9.52  $ 8.33 

Dividends declared $ 2.40  $ 2.20 
Weighted-average number of shares outstanding:
Basic 138,342  138,898 
Diluted 139,130  139,958 
Performance metrics:
Return on average assets (“ROA”) 1.70  % 1.60  %
Return on average common equity (“ROAE”) 16.01  % 15.93  %
Return on average tangible common equity (“ROATCE”) (1)
16.99  % 17.05  %

Common dividend payout ratio 25.30  % 26.58  %
Net interest margin 3.41  % 3.27  %

Efficiency ratio (2)
35.69  % 36.65  %

At year end:
Total assets $ 80,434,997  $ 75,976,475 
Total loans $ 56,899,148  $ 53,726,637 

Total deposits $ 67,082,701  $ 63,175,023 
Common shares outstanding at period-end 137,579  138,437 
Book value per share $ 64.68  $ 55.79 
Tangible book value per share (1)
$ 61.27  $ 52.39 

(1) For additional information regarding the reconciliation of these non-U.S. GAAP financial measures, refer to Item 7. MD&A — Reconciliation of GAAP to Non-GAAP Financial Measures in this Form 10-K.
(2) Efficiency ratio is calculated as noninterest expense divided by total revenue .

The Company’s 2025 net income was $1.3 billion, a $160 million or 14% increase from 2024. The increase was primarily driven by higher net interest income before provision for credit losses, increased noninterest income and a decrease in provision for credit losses, partially offset by higher noninterest expense and income tax expense. Noteworthy items about the Company’s performance for 2025 included:

• Net interest income and net interest margin. Year-over-year net interest income before provision for credit loss es increased $274 million or 12% to $2.6 billion in 2025. Full year 2025 net interest margin was 3.41%, a 14 bp increase year-over-year.

36

• Earnings per share growth. Full year 2025 basic EPS and diluted EPS both expanded 14% to $9.58 and $9.52, respectively.

• Profitability ratios. Full year 2025 ROA and ROAE of 1.70% and 16.01%, respectively, expanded 10 bps and 8 bps, respectively, year-over-year. Full year 2025 ROATCE was 16.99%. ROATCE is a non-GAAP financial measure. For additional information regarding the reconciliation of non-GAAP financial measures, refer to Item 7. MD&A — Reconciliation of GAAP to Non-GAAP Financial Measures in this Form 10-K.

• Efficiency ratio. The efficiency ratio was 35.69% in 2025, a 96 bp improvement compared with 2024. The improvement in the efficiency ratio primarily reflected a year-over-year increase in net interest income before provision for credit losses.

• Asset growth. Total assets reached $80.4 billion as of December 31, 2025, an increase of $4.5 billion or 6% year-over-year, primarily driven by loan growth of $3.0 billion or 6%, and an increase in AFS debt securities of $2.4 billion or 22%.

• Deposit growth. Total deposits were $67.1 billion as of December 31, 2025, an increase of $3.9 billion or 6% year-over-year, primarily reflecting growth in time deposits and noninterest-bearing demand deposits.

• Capital levels. Stockholders’ equity was $8.9 billion as of December 31, 2025, up $1.2 billion or 15%, from December 31, 2024. Book value per share of $64.68 as of December 31, 2025, increased $8.89 or 16% from December 31, 2024. Tangible book value per share of $61.27 as of December 31, 2025, increased $8.88 or 17% from December 31, 2024. Tangible book value per share is a non-GAAP financial measure. For additional details, see the reconciliation of non-GAAP financial measures presented under Item 7. MD&A — Reconciliation of GAAP to Non-GAAP Financial Measures in this Form 10-K.

Results of Operations

Net Interest Income

The Company’s primary source of revenue is net interest income, which is the interest income earned on interest-earning assets less interest expense paid on interest-bearing liabilities. Net interest margin is the ratio of net interest income to average interest-earning assets. Net interest income and net interest margin are impacted by several factors, including changes in average balances and the composition of interest-earning assets and funding sources, market interest rate fluctuations and the slope of the yield curve, repricing characteristics and maturity of interest-earning assets and interest-bearing liabilities, the volume of noninterest-bearing sources of funds, and asset quality.

Net interest income and net interest margin for 2025 increased year-over-year. The $274 million or 12% year-over-year increase in 2025 net interest income is primarily due to lower interest-bearing deposit funding costs and increases in the average balances of deposits, AFS debt securities and loans, partially offset by lower loan yields. The 14 bps year-over-year increase in 2025 net interest margin primarily reflected lower interest-bearing deposit costs, partially offset by an increase in AFS securities and decreases in the yield and balances of interest-bearing cash and deposits with banks.

37

Average interest-earning assets increased $5.2 billion or 7% to $74.9 billion in 2025. The year-over-year increase in average interest-earning assets primarily reflected increases in AFS debt securities and loan growth. The yield on average interest-earning assets was 5.73% in 2025, a decrease of 28 bps from 2024. The year-over-year decrease in the yield on average interest-earning assets primarily reflected the impact of lower benchmark interest rates of the loan portfolio.

The average loan yield was 6.40% in 2025, a decrease of 27 bps from 2024. The year-over-year decrease in the average loan yield primarily reflected the loan portfolio’s sensitivity to lower benchmark interest rates. Excluding the $32 million discount accretion and interest recoveries from the full payment on purchased credit impaired and workout loans from the 2025 loans’ interest income, the adjusted average loan yield for 2025 was 6.34%, compared with 6.67% in 2024. Adjusted average loan yield is a non-GAAP financial ratio. For additional details, refer to Item 7. MD&A — Reconciliation of GAAP to Non-GAAP Financial Measures in this Form 10-K. Approximately 58% of loans held-for-investment were variable-rate as of both December 31, 2025 and 2024.

38

Deposits are an important source of funds and impact both net interest income and net interest margin. Average deposits of $64.8 billion in 2025, increased $5.2 billion or 9% from 2024. Average noninterest-bearing deposits of $15.6 billion in 2025, increased $799 million or 5% from 2024. Average noninterest-bearing deposits made up 24% and 25% of average deposits in 2025 and 2024, respectively.

The average cost of deposits was 2.46% in 2025, a decrease of 42 bps from 2024. The average cost of interest-bearing deposits was 3.24% in 2025, a decrease of 59 bps from 2024. These year-over-year decreases primarily reflected the impacts of lower benchmark interest rates and the Company’s efforts to reduce deposit costs.

The average cost of funds calculation includes deposits, short-term borrowings, FHLB advances, assets sold under repurchase agreements (“repurchase agreements”) and long-term debt. In 2025, the average cost of funds was 2.56%, a decrease of 46 bps from 2024. The year-over-year decrease was mainly driven by the change in the average cost of deposits as discussed above.

The Company utilizes various tools to manage interest rate risk. Refer to the Interest Rate Risk Management section of Item 7. MD&A — Risk Management — Market Risk Management for details.

39

The following table presents the interest spread, net interest margin, average balances, interest income and expense, and the average yield/rate by asset and liability component in 2025, 2024 and 2023:

Year Ended December 31,
2025 2024 2023
($ in thousands) Average Balance Interest Average Yield/Rate Average Balance Interest Average Yield/Rate Average Balance Interest Average Yield/Rate
ASSETS
Interest-earning assets:
Interest-bearing cash and deposits with banks $ 4,264,056  $ 159,081  3.73 % $ 4,936,550  $ 231,794  4.70 % $ 4,638,630  $ 220,643  4.76 %
Assets purchased under resale agreements (“resale agreements”) (1)
425,000  6,475  1.52 % 519,263  11,254  2.17 % 691,223  20,164  2.92 %
Debt securities:
AFS (2)(3)
12,516,569  572,959  4.58 % 8,811,274  399,280  4.53 % 6,105,999  225,592  3.69 %
Held-to-maturity (“HTM”) (2)
2,890,503  48,978  1.69 % 2,935,937  49,785  1.70 % 2,976,237  50,598  1.70 %
Total debt securities (2)
15,407,072  621,937  4.04 % 11,747,211  449,065  3.82 % 9,082,236  276,190  3.04 %
Loans:
Commercial and industrial (“C&I”) (2)
17,447,333  1,242,165  7.12 % (4)
16,492,472  1,294,451  7.85 % 15,499,899  1,190,940  7.68 %
CRE (2)
20,709,803  1,281,156  6.19 % 20,316,013  1,292,973  6.36 % 19,824,272  1,227,795  6.19 %
Residential mortgage 16,420,367  968,689  5.90 % 15,504,795  900,514  5.81 % 14,155,784  750,813  5.30 %
Other consumer 47,456  2,651  5.59 % 55,500  3,041  5.48 % 65,181  3,198  4.91 %
Total loans (2)(5)(6)
54,624,959  3,494,661  6.40 % (4)
52,368,780  3,490,979  6.67 % 49,545,136  3,172,746  6.40 %
Restricted equity securities 161,400  11,242  6.97 % 147,080  10,104  6.87 % 82,177  4,062  4.94 %
Total interest-earning assets $ 74,882,487   $ 4,293,396   5.73 % $ 69,718,884   $ 4,193,196   6.01 % $ 64,039,402   $ 3,693,805   5.77 %
Noninterest-earning assets:
Cash and due from banks 386,798  345,056  555,689 
Allowance for loan, lease, and securities’ losses (763,105) (688,448) (625,785)
Other assets 3,393,682  3,446,350  3,788,199 
Total assets $ 77,899,862   $ 72,821,842   $ 67,757,505  
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing liabilities:
Checking deposits $ 7,589,980  $ 183,262  2.41 % $ 7,731,828  $ 221,367  2.86 % $ 7,658,414  $ 179,200  2.34 %
Money market deposits 15,685,199  488,496  3.11 % 13,970,375  525,870  3.76 % 11,680,540  399,482  3.42 %
Savings deposits 1,719,422  13,519  0.79 % 1,770,041  17,764  1.00 % 2,128,943  15,573  0.73 %
Time deposits 24,256,155  909,252  3.75 % 21,400,834  955,173  4.46 % 16,301,856  611,295  3.75 %
Total interest-bearing deposits 49,250,756  1,594,529  3.24 % 44,873,078  1,720,174  3.83 % 37,769,753  1,205,550  3.19 %
Bank Term Funding Program (“BTFP”), short-term borrowings and federal funds purchased 740  22  2.97 % 962,061  42,163  4.38 % 3,591,114  157,002  4.37 %
FHLB advances 3,181,509  141,472  4.45 % 2,752,733  147,269  5.35 % 123,288  6,430  5.22 %
Repurchase agreements 46,199  2,082  4.51 % 3,613  197  5.45 % 34,443  1,497  4.35 %
Long-term debt and finance lease liabilities 35,780  2,662  7.44 % 58,467  4,677  8.00 % 152,790  11,072  7.25 %
Total interest-bearing liabilities $ 52,514,984   $ 1,740,767   3.31 % $ 48,649,952   $ 1,914,480   3.94 % $ 41,671,388   $ 1,381,551   3.32 %
Noninterest-bearing liabilities and stockholders’ equity:
Demand deposits 15,598,605  14,799,961  17,192,978 
Accrued expenses and other liabilities 1,509,865  2,056,755  2,410,154 
Stockholders’ equity 8,276,408  7,315,174  6,482,985 
Total liabilities and stockholders’ equity $ 77,899,862   $ 72,821,842   $ 67,757,505  
Interest rate spread 2.42 % 2.07 % 2.45 %
Net interest income and net interest margin $ 2,552,629   3.41 % $ 2,278,716   3.27 % $ 2,312,254   3.61 %

(1) Includes the average balances and interest income for securities and loans purchased under resale agreements for 2023. There were no loans purchased under resale agreements for both 2025 and 2024.
(2) Yields on tax-exempt debt securities and loans are not presented on a tax-equivalent basis.
(3) Includes the amortization of net premiums on AFS debt securities of $26 million, $35 million and $31 million for 2025, 2024 and 2023, respectively.
(4) Includes $32 million of additional interest income from discount accretion and interest recoveries from the full payment on purchased credit impaired and workout loans during the twelve months ended December 31, 2025. Refer to Item 7. MD&A — Reconciliation of GAAP to Non-GAAP Financial Measures in this Form 10-K.
(5) Average balances include nonperforming loans and loans held-for-sale.
(6) Includes the accretion of net deferred loan fees and amortization of net premiums, which totaled $81 million for 2025 and $53 million for each of 2024 and 2023.
40

The following table summarizes the extent to which changes in (1) interest rates, and (2) volume of average interest-earning assets and average interest-bearing liabilities affected the Company’s net interest income for the periods presented. The total change for each category of interest-earning assets and interest-bearing liabilities is segmented into changes attributable to variations in volume and yield/rate. Changes that are not solely due to either volume or yield/rate are allocated proportionally based on the absolute value of the change related to average volume and average yield/rate.

Year Ended December 31,
2025 vs. 2024 2024 vs. 2023
Changes Due to Changes Due to
($ in thousands) Total Change Volume Yield/Rate Total Change Volume Yield/Rate
Interest-earning assets:
Interest-bearing cash and deposits with banks $ (72,713) $ (28,990) $ (43,723) $ 11,151  $ 14,019  $ (2,868)
Resale agreements (1)
(4,779) (1,813) (2,966) (8,910) (4,382) (4,528)
Debt securities:
AFS 173,679  169,573  4,106  173,688  114,930  58,758 
HTM (807) (770) (37) (813) (684) (129)
Total debt securities 172,872  168,803  4,069  172,875  114,246  58,629 
Loans:
C&I (52,286) 72,271  (124,557) 103,511  77,492  26,019 
CRE (11,817) 24,775  (36,592) 65,178  30,853  34,325 
Residential mortgage 68,175  53,837  14,338  149,701  74,955  74,746 
Other consumer (390) (448) 58  (157) (506) 349 
Total loans 3,682  150,435  (146,753) 318,233  182,794  135,439 
Restricted equity securities 1,138  996  142  6,042  4,045  1,997 
Total interest and dividend income $ 100,200  $ 289,431  $ (189,231) $ 499,391  $ 310,722  $ 188,669 
Interest-bearing liabilities:
Checking deposits $ (38,105) $ (3,994) $ (34,111) $ 42,167  $ 1,734  $ 40,433 
Money market deposits (37,374) 59,918  (97,292) 126,388  83,521  42,867 
Savings deposits (4,245) (495) (3,750) 2,191  (2,930) 5,121 
Time deposits (45,921) 118,165  (164,086) 343,878  213,823  130,055 
Total interest-bearing deposits (125,645) 173,594  (299,239) 514,624  296,148  218,476 
BTFP, short-term borrowings and federal funds purchased (42,141) (42,104) (37) (114,839) (115,219) 380 
FHLB advances (5,797) 21,081  (26,878) 140,839  140,669  170 
Repurchase agreements 1,885  1,925  (40) (1,300) (1,606) 306 
Long-term debt and finance lease liabilities (2,015) (1,707) (308) (6,395) (7,443) 1,048 
Total interest expense $ (173,713) $ 152,789  $ (326,502) $ 532,929  $ 312,549  $ 220,380 
Changes in net interest income
$ 273,913   $ 136,642   $ 137,271   $ (33,538) $ (1,827) $ (31,711)

(1) Includes the average balances and interest income for securities and loans purchased under resale agreements for 2023. There were no loans purchased under resale agreements for both 2025 and 2024.

41

Noninterest Income

The following table presents the components of noninterest income for the periods indicated:

Year Ended December 31,

($ in thousands) 2025 2024 % Change from 2024 2023
Commercial and consumer deposit-related fees $ 111,844  $ 103,880  8  % $ 93,811 
Lending and loan servicing fees 107,988  98,455  10  % 83,876 
Foreign exchange income 58,905  54,605  8  % 48,276 
Wealth management fees 50,000  38,627  29  % 26,994 
Customer derivative income, net of mark-to-market adjustments:
Customer derivative income 19,053  14,923  28  % 23,216 
Derivative mark-to-market and credit valuation adjustments (2,197) 1,478  NM (3,016)
Total customer derivative income, net of mark-to-market adjustments 16,856  16,401  3  % 20,200 
Net gains (losses) on AFS debt securities
963  2,069  (53) % (6,862)

Other investment income 10,868  5,611  94  % 9,348 
Other income 21,803  15,570  40  % 17,469 
Total noninterest income $ 379,227   $ 335,218   13   % $ 293,112  
Noninterest income as a percentage of total revenue
13   % 13   % 11   %

NM — Not meaningful.

Noninterest income comprised 13% of total revenue in both 2025 and 2024. Noninterest income for 2025 was $379 million, a $44 million or 13% increase compared with 2024. The increase was primarily due to higher wealth management fees, lending and loan servicing fees, commercial and consumer deposit-related fees, other income, other investment income, and foreign exchange income.

Commercial and consumer deposit-related fees were $112 million in 2025, an increase of $8 million or 8%, compared with 2024. This year-over-year increase was primarily due to analysis service fees, which reflected higher commercial customer activity and fee increases.

Lending and loan servicing fees were $108 million in 2025, an increase of $10 million or 10%, compared with 2024. The year-over-year increase was primarily due to higher trade finance and credit enhancement fees driven by increased customer activity.

Foreign exchange income was $59 million, an increase of $4 million or 8%, compared with 2024. The year-over-year increase was primarily due to increased customer activity and the favorable valuation of certain foreign currency denominated balance sheet items, partially offset by losses on foreign exchange trades.

Wealth management fees were $50 million in 2025, an increase of $11 million or 29%, compared with 2024. The year-over-year increase primarily reflected higher customer demand for wealth management products such as fixed-rate corporate bonds and fixed annuities.

Other investment income was $11 million in 2025, an increase of $5 million or 94% compared with 2024. The year-over-year increase primarily reflected $5 million of recoveries, $3 million of which were related to the Company’s previous investment in DC Solar recorded in other investment income, $1 million of fair value gains from the derivative liability-classified equity contract related to the 2023 Rayliant investment, and higher distributions from affordable housing partnership investments.

Other income was $22 million in 2025, an increase of $6 million or 40% compared with 2024. The year-over-year increase primarily reflected $4 million increased income from bank-owned life insurance and a structuring fee received from an energy tax credit investment.

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Noninterest Expense

The following table presents the components of noninterest expense for the periods indicated:

Year Ended December 31,

($ in thousands) 2025 2024 % Change from 2024 2023
Compensation and employee benefits $ 618,753  $ 550,734  12  % $ 508,538 
Occupancy and equipment expense 66,129  64,399  3  % 64,528 
Deposit account expense 35,218  47,390  (26) % 43,143 
Computer and software related expenses 54,737  47,271  16  % 44,475 
Deposit insurance premiums and regulatory assessments 31,725  45,736  (31) % 103,308 

Other operating expense 165,039  148,301  11  % 136,305 
Amortization of tax credit and CRA investments
74,795  54,242  38  % 120,299 

Total noninterest expense $ 1,046,396   $ 958,073   9   % $ 1,020,596  

Noninterest expense was $1.0 billion in 2025, an increase of $88 million or 9%, compared with 2024. The increase was primarily due to higher compensation and employee benefits, amortization of tax credit and CRA investments, other operating expense, and computer and software related expenses, partially offset by lower deposit insurance premiums and regulatory assessments, and deposit account expense.

Compensation and employee benefits were $619 million in 2025, an increase of $68 million or 12%, compared with 2024. The year-over-year increase was primarily driven by $31 million of additional compensation expense recognized from the change in equity award expense recognition for retirement eligible employees, while the remaining increase was due to merit increases and staffing growth. Refer to Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Stock-Based Compensation for details related to the change in the timing of recognition for awards granted to retirement-eligible employees.

Deposit account expense was $35 million in 2025, a decrease of $12 million or 26%, compared with 2024. The year-over-year decrease was primarily driven by lower balances and referral rates paid on certain deposit accounts.

Computer and software related expenses were $55 million in 2025, an increase of $7 million or 16% compared with 2024. The year-over-year increases primarily reflected higher software expenses and data processing costs to support the Company’s growth.

Deposit insurance premiums and regulatory assessments were $32 million in 2025, a decrease of $14 million or 31%, compared with 2024. The year-over-year decrease was primarily due to lower FDIC charges, which reflected a decrease in the estimated losses to the FDIC’s DIF. For additional information related to the FDIC charge, see Item 1. Business — Supervision and Regulation — FDIC Deposit Insurance Assessments in this Form 10-K.

Other operating expense was $165 million in 2025, an increase of $17 million or 11%, compared with 2024. The year-over-year increase was primarily due to problem loan related expenses, higher consulting expenses for various Company initiatives, and other real estate owned (“OREO”) write-downs, partially offset by a decrease in interest paid on cash collateral.

Amortization of tax credit and CRA investments was $75 million in 2025, an increase of $21 million or 38%, compared with 2024. The year-over-year increase was primarily due to the timing of tax credit investments that closed in a given period.

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Income Taxes

The following table presents income before income taxes, income tax expense and effective tax rate for the periods indicated:

Year Ended December 31,
($ in thousands) 2025 2024 % Change from 2024 2023
Income before income taxes $ 1,725,460  $ 1,481,861  16% $ 1,459,770 
Income tax expense $ 400,272  $ 316,275  27% $ 298,609 
Effective tax rate 23.2  % 21.3  % 20.5  %

Income tax expense for 2025, compared with 2024, increased $84 million or 27%, primarily due to higher pre-tax income, and the one-time revaluation of deferred tax assets due to the adoption of the California single sales factor apportionment method in 2025, partially offset by favorable adjustments driven by a lower California state tax apportionment. The differences between the 2025 and 2024 effective tax rates from the federal statutory rate of 21% were primarily due to state taxes, partially offset by tax credits associated with energy, affordable housing, historic and new market tax credit investments. Refer to Note 11 — Income Taxes to the Consolidated Financial Statements in this Form 10-K.

Operating Segment Results

The Company organizes its operations into three reportable operating segments: (1) Consumer and Business Banking; (2) Commercial Banking; and (3) Treasury and Other. These segments are defined based on customer type, the channels where customers are served, and the products and services provided. For a description of the Company’s internal management reporting process, including the segment cost allocation methodology, see Note 17 — Business Segments to the Consolidated Financial Statements in this Form 10-K.

Segment net interest income represents the difference between actual interest earned on assets and interest incurred on liabilities of the segment, adjusted for funding charges or credits through the Company’s internal funds transfer pricing process.

Consumer and Business Banking

The Consumer and Business Banking segment primarily provides financial products and services to consumer and commercial customers through the Company’s domestic branch network and digital banking platforms. This segment offers consumer and commercial deposits, mortgage and home equity loans, and other products and services. It also originates commercial loans for small- and medium-sized enterprises through the Company’s branch network. Other products and services provided by this segment include wealth management, private banking, treasury management, interest rate risk hedging and foreign exchange services.

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The following table presents financial information for the Consumer and Business Banking segment for the periods indicated:

Year Ended December 31,
Change from 2024

($ in thousands) 2025 2024 $ % 2023
Net interest income before provision for credit losses
$ 1,079,288  $ 1,152,033  $ (72,745) (6) % $ 1,225,954 
Noninterest income 120,779  108,773  12,006  11  % 103,210 
Total revenue before provision for credit losses
1,200,067  1,260,806  (60,739) (5) % 1,329,164 
Provision for credit losses 26,044  8,691  17,353  200  % 21,454 
Compensation and employee benefits 240,500  217,612  22,888  11  % 203,387 
Other noninterest expense 229,833  234,494  (4,661) (2) % 261,406 
Total noninterest expense 470,333  452,106  18,227  4  % 464,793 
Segment income before income taxes 703,690  800,009  (96,319) (12) % 842,917 
Income tax expense 201,003  236,791  (35,788) (15) % 247,952 
Segment net income $ 502,687  $ 563,218  $ (60,531) (11) % $ 594,965 
Average loans $ 20,313,671  $ 18,966,662  $ 1,347,009  7  % $ 17,739,984 
Average deposits $ 33,384,458  $ 30,815,912  $ 2,568,546  8  % $ 28,174,781 

Consumer and Business Banking segment net income decreased $61 million or 11% year-over-year to $503 million in 2025, primarily due to a $73 million decrease in net interest income, a $23 million increase in compensation and employee benefits, and a $17 million increase in provision for credit losses, partially offset by a $12 million increase in noninterest income.

The decrease in net interest income before provision for credit losses was primarily driven by the year-over-year decline in interest rates. The increase in noninterest income was mainly driven by higher wealth management fees in 2025. The increase in provision for credit losses was driven by loan growth and the worsening macroeconomic outlook in the residential mortgage loan sector in 2025. The increase in compensation and employee benefits was primarily due to staffing growth and increased wealth management commissions. The decrease in other noninterest expense was primarily driven by decreased deposit insurance premiums and regulatory assessments, from lower FDIC charges.

Commercial Banking

The Commercial Banking segment primarily generates commercial loan and deposit products. Commercial loan products include CRE lending, construction finance, commercial business lending, working capital lines of credit, trade finance, letters of credit, affordable housing lending, asset-based lending, asset-backed finance, project finance, equipment financing, and loan syndication. Commercial deposit products and other financial services include treasury management, foreign exchange services, and interest rate and commodity risk hedging.

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The following table presents financial information for the Commercial Banking segment for the periods indicated:

Year Ended December 31,
Change from 2024

($ in thousands) 2025 2024 $ % 2023
Net interest income before provision for credit losses
$ 1,028,314  $ 1,125,931  $ (97,617) (9) % $ 1,116,013 
Noninterest income 218,177  197,780  20,397  10  % 168,502 
Total revenue before provision for credit losses
1,246,491  1,323,711  (77,220) (6) % 1,284,515 
Provision for credit losses 152,085  166,953  (14,868) (9) % 100,391 
Compensation and employee benefits 246,303  234,240  12,063  5  % 217,663 
Other noninterest expense 157,616  161,969  (4,353) (3) % 158,949 
Total noninterest expense 403,919  396,209  7,710  2  % 376,612 
Segment income before income taxes 690,487  760,549  (70,062) (9) % 807,512 
Income tax expense 196,979  224,897  (27,918) (12) % 237,359 
Segment net income $ 493,508  $ 535,652  $ (42,144) (8) % $ 570,153 
Average loans $ 34,000,936  $ 32,996,221  $ 1,004,715  3  % $ 31,365,547 
Average deposits $ 27,137,950  $ 25,820,956  $ 1,316,994  5  % $ 23,304,066 

Commercial Banking segment net income decreased $42 million or 8% year-over-year to $494 million in 2025, primarily driven by a $98 million decrease in net interest income, partially offset by a $20 million increase in noninterest income and a $15 million decrease in provision for credit losses.

The net interest income decrease was primarily driven by the year-over-year decline in interest rates. The noninterest income increase was primarily due to increases in lending and loan servicing fees, commercial deposit-related fees, and wealth management fees. The decrease in provision for credit losses was primarily driven by lower net charge-offs in the C&I portfolio. The increase in compensation and employee benefits was primarily driven by staffing growth. The decrease in other noninterest expense was primarily driven by the decreases in deposit account expense and deposit insurance premiums and regulatory assessments, partially offset by increased loan related expenses.

Treasury and Other

Centralized functions, including the corporate treasury activities of the Company, tax credit investment activity, eliminations of inter-segment amounts, and centrally managed departments, have been aggregated and included in the Treasury and Other segment.

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The following table presents financial information for the Treasury and Other segment for the periods indicated:

Year Ended December 31,
Change from 2024

($ in thousands) 2025 2024 $ % 2023
Net interest income (loss) before (reversal of) provision for credit losses $ 445,027  $ 752  $ 444,275  NM $ (29,713)
Noninterest income 40,271  28,665  11,606  40  % 21,400 
Total revenue (loss) before (reversal of) provision for credit losses
485,298  29,417  455,881  NM (8,313)
(Reversal of) provision for credit losses
(18,129) (1,644) (16,485) NM 3,155 
Compensation and employee benefits 131,950  98,882  33,068  33  % 87,488 
Other noninterest expense 40,194  10,876  29,318  270  % 91,703 
Total noninterest expense 172,144  109,758  62,386  57  % 179,191 
Segment income (loss) before income taxes
331,283  (78,697) 409,980  NM (190,659)
Income tax expense (benefit)
2,290  (145,413) 147,703  NM (186,702)
Segment net income (loss)
$ 328,993  $ 66,716  $ 262,277  393  % $ (3,957)
Average loans $ 310,352  $ 405,897  $ (95,545) (24) % $ 439,605 
Average deposits $ 4,326,953  $ 3,036,171  $ 1,290,782  43  % $ 3,483,884 

NM — Not meaningful.

Treasury and Other segment income before income taxes increased $410 million in 2025, primarily driven by a $444 million increase in net interest income and $16 million increase in reversal of credit losses, partially offset by a $33 million increase in compensation and employee benefits and a $29 million increase in other noninterest expense.

The net interest income increase was mainly driven by higher AFS debt securities’ interest income due to higher average balances and higher loan interest income, primarily due to $32 million of additional interest income from discount accretion and interest recoveries from the full payment on purchased credit impaired and workout loans. The increase in reversal of credit losses was primarily due to an $18 million reversal of credit losses related to the payoff of purchased credit impaired loans in the third quarter of 2025. The increase in compensation and employee benefits was primarily driven by additional compensation expense from a change in equity award expense recognition for retirement eligible employees recorded in the third quarter of 2025. Refer to Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Stock-Based Compensation to the Consolidated Financial Statements in this Form 10-K for further details related to the change in the timing of recognition for awards granted to retirement-eligible employees. The increase in other noninterest expense was primarily driven by higher amortization of tax credit and CRA investments.

Income tax expense is allocated to the Consumer and Business Banking and the Commercial Banking segments by applying statutory income tax rates to the respective segment income before income taxes. The income tax expense or benefit in the Treasury and Other segment consists of the remaining unallocated income tax expense or benefit after allocating income tax expense to the two core segments, and reflects the impact of tax credit investment activity.

Balance Sheet Analysis

Debt Securities

The Company maintains a portfolio of high quality and liquid debt securities with a moderate duration profile. It closely manages the overall portfolio credit, interest rate and liquidity risks. The Company’s debt securities provide:
• interest income for earnings and yield enhancement;
• funding availability for needs arising during the normal course of business;
• the ability to execute interest rate risk management strategies in response to changes in economic or market conditions; and
47

• collateral to support pledging agreements as required and/or to enhance the Company’s borrowing capacity.

While the Company does not intend to sell its debt securities, it may sell AFS debt securities in response to changes in the balance sheet and related interest rate risk to meet liquidity, regulatory and strategic requirements.

The following table presents the distribution of the Company’s AFS and HTM debt securities portfolio as of December 31, 2025 and 2024, and by credit ratings as of December 31, 2025:

December 31, 2025
December 31, 2024
Rating as of December 31, 2025 (1)

($ in thousands) Amortized Cost Fair Value % of Fair Value Amortized Cost Fair Value % of Fair Value AAA/AA A BBB BB and Lower No Rating (2)

AFS debt securities:
U.S. Treasury securities $ 1,010,053  $ 993,913  7 % $ 676,300  $ 638,265  6 % 100 % — % — % — % — %
U.S. government agency and U.S. government-sponsored enterprise debt securities 287,687  257,654  2 % 308,220  262,587  3 % 100 % — % — % — % — %
U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities (3)
10,544,278  10,397,991  79 % 8,447,303  8,164,474  75 % 100 % — % — % — % — %
Municipal securities 277,275  243,102  2 % 287,301  250,153  2 % 100 % — % — % — % — %
Non-agency mortgage-backed securities 667,195  584,735  4 % 808,762  692,078  6 % 95 % 3 % — % 2 % — %

Corporate debt securities 554,158  464,981  4 % 653,500  526,166  5 % — % 38 % 59 % 3 % — %
Foreign government bonds 247,249  238,455  2 % 244,803  233,880  2 % 46 % 54 % — % — % — %
Asset-backed securities 31,886  31,389  0 % 35,086  34,715  0 % 30 % 17 % 53 % — % — %
Collateralized loan obligations —  —  — % 44,500  44,493  1 % — % — % — % — % — %

Total AFS debt securities $ 13,619,781   $ 13,212,220   100 % $ 11,505,775   $ 10,846,811   100 % 95 % 3 % 2 % 0 % — %
HTM debt securities:
U.S. Treasury securities $ 540,666  $ 524,887  21 % $ 535,080  $ 499,858  21 % 100 % — % — % — % — %
U.S. government agency and U.S. government-sponsored enterprise debt securities 1,007,055  860,134  35 % 1,004,479  804,220  34 % 100 % — % — % — % — %
U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities (4)
1,136,874  943,227  38 % 1,190,221  943,134  39 % 100 % — % — % — % — %
Municipal securities 185,463  151,498  6 % 187,633  140,542  6 % 100 % — % — % — % — %
Total HTM debt securities $ 2,870,058   $ 2,479,746   100 % $ 2,917,413   $ 2,387,754   100 % 100 % — % — % — % — %
Total debt securities $ 16,489,839   $ 15,691,966   $ 14,423,188   $ 13,234,565  

(1) Credit ratings represent independent assessments of the credit quality of debt securities. The Company determines the credit rating of a debt security based on the lowest rating assigned by any of the nationally recognized statistical rating organizations (“NRSROs”) that have rated the security. Investment grade debt securities are those with ratings similar to BBB- or above (as defined by NRSROs) and are generally considered by the rating agencies and market participants to be low credit risk. Ratings percentages are allocated based on fair value.
(2) For debt securities not rated by NRSROs, factors such as the priority in collections within the securitization structure, and whether contractual payments have historically been on time are considered in determining the credit risk of such securities.
(3) Includes Government National Mortgage Association (“GNMA”) AFS debt securities totaling $9.6 billion of both amortized cost and fair value as of December 31, 2025, and $7.3 billion of amortized cost and $7.2 billion of fair value as of December 31, 2024.
(4) Includes GNMA HTM debt securities totaling $79 million of amortized cost and $65 million of fair value as of December 31, 2025, and $86 million of amortized cost and $68 million of fair value as of December 31, 2024.

48

As of December 31, 2025, the Company’s AFS and HTM debt securities portfolios had an effective duration (defined as the sensitivity of the value of the portfolio to interest rate changes) of 3.0 and 5.9, respectively, compared with 2.0 and 6.2, respectively, as of December 31, 2024. The effective duration of AFS debt securities increased primarily due to the longer maturities of newly purchased AFS securities, while the HTM debt securities’ effective duration declined slightly due to the general runoff of the portfolio.

Available-for-Sale Debt Securities

AFS debt securities increased $2.4 billion or 22% to $13.2 billion in 2025 from December 31, 2024, primarily due to the purchases of GNMA securities. The Company’s AFS debt securities are carried at fair value with non-credit related unrealized gains and losses, net of tax, reported in Other comprehensive income (loss) on the Consolidated Statement of Comprehensive Income. Pre-tax net unrealized losses on AFS debt securities were $406 million as of December 31, 2025, compared with $659 million as of December 31, 2024.

Of the AFS debt securities with gross unrealized losses, substantially all were rated investment grade as of both December 31, 2025 and 2024. There was $2 million of allowance for credit losses against AFS debt securities as of December 31, 2025, which was recognized as Provision for credit losses on the Consolidated Statement of Income. In comparison, there was no allowance for credit losses against AFS debt securities as of December 31, 2024.

Held-to-Maturity Debt Securities

All HTM debt securities were issued, guaranteed, or supported by the U.S. government or government-sponsored enterprises. Accordingly, the Company applied a zero credit loss assumption for these securities and no allowance for credit loss was recorded as of both December 31, 2025 and 2024.

For additional information on AFS and HTM securities, see Note 1 — Summary of Significant Accounting Policies, Note 2 — Fair Value Measurement and Fair Value of Financial Instruments and Note 4 — Securities to the Consolidated Financial Statements in this Form 10-K.

Loan Portfolio

The Company offers a broad range of financial products designed to meet the credit needs of its borrowers. The Company’s loan portfolio segments include commercial loans, which consist of C&I, CRE, multifamily residential, and construction and land loans, as well as consumer loans, which consist of single-family residential, home equity lines of credit (“HELOCs”) and other consumer loans. The composition of the loan portfolio as of December 31, 2025 was similar to the composition as of December 31, 2024.

The following charts present the composition of the Company’s total loan portfolio by loan type as of December 31, 2025 and 2024:

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Total loans held-for-investment of $56.9 billion as of December 31, 2025 increased $3.2 billion or 6% from December 31, 2024, reflecting well-balanced growth across major loan types. For additional information on the Company’s loans held-for-investment outstanding balances, see Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K.

Commercial

The commercial loan portfolio, which includes C&I and total CRE loans, comprised 70% of total loans held-for-investment as of both December 31, 2025 and 2024. The Company actively monitors the commercial lending portfolio for credit risk and reviews credit exposures for sensitivity to changing economic conditions.

Commercial — Commercial and Industrial Loans. Total C&I loan commitments were $27.7 billion and $25.8 billion as of December 31, 2025 and 2024, respectively, with a utilization rate of 67% as of both dates. As of December 31, 2025, total C&I loans were $18.7 billion, up $1.3 billion or 7% from December 31, 2024. The C&I loan portfolio includes loans and financing for businesses across a wide spectrum of industries. The Company offers a variety of C&I products, including but not limited to commercial business lending, working capital lines of credit, trade finance, letters of credit, asset-based lending, asset-backed finance, project finance and equipment financing. Additionally, the Company has a portfolio of broadly syndicated C&I loans, which represent revolving or term loan facilities that are marketed and sold primarily to institutional investors. This portfolio totaled $1.0 billion and $845 million as of December 31, 2025 and 2024, respectively. The Company also has a portfolio of loans to non-depository financial institutions. This portfolio totaled $7.6 billion and $6.0 billion as of December 31, 2025 and 2024, respectively, which primarily consisted of capital call lending and other credit facilities extended to these institutions. The majority of the C&I loans had variable interest rates as of both December 31, 2025, and 2024.

The C&I portfolio is well-diversified by industry. The Company monitors concentrations within the C&I loan portfolio by industry and customer exposure, and has exposure limits by industry and loan product. The following table presents the industry mix within the Company’s C&I loan portfolio as of December 31, 2025, and 2024:

December 31, 2025 December 31, 2024
($ in thousands) Amount % Amount %
Industry:
Real estate investment & management $ 2,319,896  13 % $ 2,381,186  14 %
Capital call lending 2,258,895  12 % 2,230,457  13 %
Media & entertainment 2,227,571  12 % 2,031,242  12 %
Manufacturing & wholesale 1,162,245  6 % 1,074,073  6 %
Financial services 1,160,853  6 % 1,005,216  6 %
Infrastructure & clean energy 1,113,387  6 % 963,165  5 %
Food production & distribution 1,109,996  6 % 664,135  4 %
Healthcare 703,769  4 % 685,550  4 %
Technology & telecommunications 679,036  4 % 770,521  4 %
Hospitality & leisure 646,926  3 % 575,815  3 %
Oil & gas 595,102  3 % 576,605  3 %
Art finance 503,326  3 % 548,065  3 %
Equipment finance 447,117  2 % 470,132  3 %
General & Other 3,722,636  20 % 3,420,996  20 %
Total C&I $ 18,650,755   100 % $ 17,397,158   100 %

Commercial — Total Commercial Real Estate Loans. The total CRE portfolio consists of CRE, multifamily residential, and construction and land loans. The Company’s underwriting parameters for CRE loans are established in compliance with supervisory guidance and include property type, geography and loan-to-value (“LTV”).

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The Company’s total CRE loan portfolio is well-diversified by property type with an average CRE loan size of $3 million as of both December 31, 2025 and 2024. The following table summarizes the Company’s total CRE loans by property type as of December 31, 2025 and 2024:

December 31, 2025 December 31, 2024
($ in thousands) Amount % Weighted-Avg. LTV (%) (1)
Amount % Weighted-Avg. LTV (%) (1)

Property types:
Multifamily $ 5,112,328  24 % 50 % $ 4,953,442  24 % 51 %
Retail
4,509,328  21 % 47 % 4,347,032  21 % 48 %
Industrial
4,213,307  20 % 46 % 3,972,389  20 % 46 %
Hotel
2,482,765  12 % 51 % 2,404,385  12 % 52 %
Office
2,233,910  11 % 52 % 2,125,210  11 % 54 %
Healthcare
858,653  4 % 51 % 788,806  4 % 52 %
Construction and land 742,357  3 % 51 % 666,162  3 % 49 %
Other
1,109,125  5 % 49 % 1,017,518  5 % 50 %
Total CRE loans $ 21,261,773   100 % 49 % $ 20,274,944   100 % 50 %

(1) Weighted-average LTV is based on most recent LTV, using the most recent available appraisal and current loan commitment.

The following tables provide a summary of the Company’s CRE, multifamily residential, and construction and land loans by geography as of December 31, 2025 and 2024. The distribution of the total CRE loan portfolio largely reflects the Company’s geographical branch footprint, which is primarily concentrated in California:

December 31, 2025
($ in thousands) CRE % Multifamily Residential % Construction and Land % Total CRE %
Geographic markets:
Southern California $ 7,908,374  51 % $ 2,387,149  47 % $ 252,265  34 % $ 10,547,788  50 %
Northern California 2,760,043  18 % 914,479  18 % 149,090  20 % 3,823,612  18 %
California 10,668,417  69 % 3,301,628  65 % 401,355  54 % 14,371,400  68 %
Texas 1,129,088  7 % 488,276  10 % 154,241  21 % 1,771,605  8 %
New York 831,276  6 % 349,909  7 % 35,397  5 % 1,216,582  6 %
Washington 504,643  3 % 158,186  3 % 14,036  2 % 676,865  3 %
Arizona 339,272  2 % 205,264  4 % 38,192  5 % 582,728  3 %
Nevada 321,332  2 % 160,103  3 % 883  0 % 482,318  2 %
Other markets 1,613,060  11 % 448,962  8 % 98,253  13 % 2,160,275  10 %
Total loans $ 15,407,088   100 % $ 5,112,328   100 % $ 742,357   100 % $ 21,261,773   100 %

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December 31, 2024
($ in thousands) CRE % Multifamily Residential % Construction and Land % Total CRE %
Geographic markets:
Southern California $ 7,516,638  51 % $ 2,316,404  47 % $ 230,297  35 % $ 10,063,339  50 %
Northern California 2,693,768  19 % 992,406  20 % 163,633  24 % 3,849,807  19 %
California 10,210,406  70 % 3,308,810  67 % 393,930  59 % 13,913,146  69 %
Texas 1,091,626  8 % 467,796  9 % 131,963  20 % 1,691,385  8 %
New York 732,694  5 % 249,357  5 % 44,597  7 % 1,026,648  5 %
Washington 493,972  3 % 155,022  3 % 10,401  1 % 659,395  3 %
Arizona 348,877  2 % 182,955  4 % 23,903  4 % 555,735  3 %
Nevada 293,927  2 % 139,292  3 % —  — % 433,219  2 %
Other markets 1,483,838  10 % 450,210  9 % 61,368  9 % 1,995,416  10 %
Total loans $ 14,655,340   100 % $ 4,953,442   100 % $ 666,162   100 % $ 20,274,944   100 %

The percentage of total CRE loans located in California was 68% and 69% as of December 31, 2025 and 2024, respectively. Changes in California’s economy and real estate values could have a significant impact on the collectability of these loans and the required level of allowance for loan losses. For additional information related to the higher degree of risk from a downturn in the California economic and real estate markets, see Item 1A. Risk Factors — Risks Related to Geographic and Political Uncertainties and Risks Related to Financial Matters in this Form 10-K.

Commercial — Commercial Real Estate Loans. The Company focuses on providing financing to experienced real estate investors and developers who have moderate levels of leverage, many of whom are long-time customers of the Bank. The Company seeks to underwrite loans with conservative standards for cash flows, debt service coverage and LTV. Owner-occupied properties comprised 20% of the CRE loans as of both December 31, 2025 and 2024. The remainder were non-owner-occupied properties, where 50% or more of the debt service for the loan is typically provided by rental income from an unaffiliated third party.

Interest rates on CRE loans may be fixed, variable or hybrid. The Company offers derivative hedging products to our customers to manage their interest rate risks. As of December 31, 2025, of the 58% of our CRE portfolio that had variable rates , 52% had customer-level interest rate derivative contracts in place. In comparison, as of December 31, 2024, of the 57% of our CRE portfolio that had variable rates, 54% had customer-level interest rate derivative contracts in place.

Commercial — Multifamily Residential Loans. The multifamily residential loan portfolio is largely comprised of loans secured by residential properties with five or more units. The Company offers a variety of first lien mortgages, including fixed- and variable-rate loans, as well as hybrid loans with interest rates that adjust annually after an initial fixed rate period of three to ten years. The Company also offers hedging products to our customers to manage their interest rate risks. As of December 31, 2025, of th e 51% of our multifamily residential portfolio that had variable rates, 50% had customer-level interest rate derivative contracts in place. In comparison, as of December 31, 2024, of the 50% of our multifamily residential loan portfolio that was variable rate, half had customer-level interest rate derivative contracts in place.

Commercial — Construction and Land Loans. Construction and land loans provide financing for a portfolio of projects diversified by real estate property type. Construction loan exposure was comprised of $544 million in loans outstanding, and $419 million in unfunded commitments as of December 31, 2025, compared with $506 million in loans outstanding, and $391 million in unfunded commitments as of December 31, 2024. Land loans totaled $198 million and $160 million as of December 31, 2025 and 2024, respectively.

52

Consumer

Residential mortgage loans are primarily originated through the Bank’s branch network . The average residential mortgage loan size was $439 thousand and $437 thousand as of December 31, 2025 and 2024, respectively. The following tables summarize the Company’s single-family residential and HELOC loan portfolios by geography and lien priority as of December 31, 2025 and 2024:

December 31, 2025
($ in thousands) Single-Family Residential % HELOCs % Total Residential Mortgage %
Geographic markets:
Southern California $ 6,031,124  40 % $ 914,803  48 % $ 6,945,927  41 %
Northern California 2,026,767  14 % 392,461  20 % 2,419,228  14 %
California 8,057,891  54 % 1,307,264  68 % 9,365,155  55 %
New York 4,067,708  27 % 286,995  15 % 4,354,703  26 %
Washington 761,739  5 % 188,146  10 % 949,885  6 %
Massachusetts 566,462  4 % 68,375  4 % 634,837  4 %
Georgia 520,039  3 % 21,500  1 % 541,539  3 %
Nevada 493,670  3 % 38,072  2 % 531,742  3 %
Texas 513,038  4 % —  — % 513,038  3 %
Other markets 22,002  0 % 1,545  0 % 23,547  0 %
Total $ 15,002,549   100 % $ 1,911,897   100 % $ 16,914,446   100 %
Lien priority:
First mortgage $ 15,002,549  100 % $ 1,337,066  70 % $ 16,339,615  97 %
Junior lien mortgage —  — % 574,831  30 % 574,831  3 %
Total $ 15,002,549   100 % $ 1,911,897   100 % $ 16,914,446   100 %

December 31, 2024
($ in thousands) Single-Family Residential % HELOCs % Total Residential Mortgage %
Geographic markets:
Southern California $ 5,475,929  39 % $ 853,858  47 % $ 6,329,787  39 %
Northern California 1,825,462  13 % 379,692  21 % 2,205,154  14 %
California 7,301,391  52 % 1,233,550  68 % 8,534,941  53 %
New York 4,303,815  31 % 266,529  15 % 4,570,344  29 %
Washington 715,968  5 % 187,220  10 % 903,188  6 %
Massachusetts 457,147  3 % 66,181  4 % 523,328  3 %
Georgia 466,790  3 % 20,040  1 % 486,830  3 %
Nevada
447,097  3 % 32,578  2 % 479,675  3 %
Texas
468,461  3 % —  — % 468,461  3 %
Other markets 14,777  0 % 5,530  0 % 20,307  0 %
Total $ 14,175,446   100 % $ 1,811,628   100 % $ 15,987,074   100 %
Lien priority:
First mortgage $ 14,175,446  100 % $ 1,322,957  73 % $ 15,498,403  97 %
Junior lien mortgage —  — % 488,671  27 % 488,671  3 %
Total $ 14,175,446   100 % $ 1,811,628   100 % $ 15,987,074   100 %

53

Consumer — Single-Family Residential Loans. The Company offers a variety of single-family residential mortgage loan programs, including fixed- and variable-rate loans, as well as hybrid loans with interest rates that adjust on a regular basis, typically annually, after an initial fixed rate period. The Company was in a first lien position in all of its single-family residential loans as of both December 31, 2025 and 2024. Many of these loans are reduced documentation loans, for which a substantial down payment is required, resulting in a low LTV ratio at origination, typically 65% or less. The weighted-average LTV ratio was 52% as of both December 31, 2025 and 2024. These loans have historically experienced low delinquency and loss rates.

Consumer — Home Equity Lines of Credit. Total HELOC commitments were $5.5 billion and $5.3 billion as of December 31, 2025 and 2024, respectively, with a utilization rate of 35% as of December 31, 2025, compared with 34% as of December 31, 2024. Substantially all of the Company’s unfunded HELOC commitments are unconditionally cancellable. The Company was in a first lien position for 70% and 73% of total outstanding HELOCs as of December 31, 2025 and 2024, respectively. Many of these loans are reduced documentation loans, which have a low LTV ratio at origination, typically 65% or less. The weighted-average LTV ratio was 46% as of both December 31, 2025 and 2024. As a result, these loans have historically experienced low delinquency and loss rates. Substantially all of the Company’s HELOCs were variable-rate loans as of both December 31, 2025 and 2024.

All originated commercial and consumer loans are subject to the Company’s conservative underwriting guidelines and loan origination standards. Management believes that the Company’s underwriting criteria and procedures adequately consider the unique risks associated with these products. The Company conducts quality control procedures and periodic audits, including the review of lending and legal requirements, to ensure that the Company is in compliance with these requirements.

The following table presents the contractual loan maturities by loan category and the contractual distribution of loans to changes in interest rates as of December 31, 2025:

($ in thousands) Due within one year Due after one year through five years Due after five years through fifteen years Due after fifteen years Total
Commercial:
C&I $ 7,205,052  $ 10,007,972  $ 1,271,071  $ 166,660  $ 18,650,755 
CRE:
CRE 1,617,809  8,270,872  5,305,762  212,645  15,407,088 
Multifamily residential 248,996  1,466,639  1,695,988  1,700,705  5,112,328 
Construction and land 360,801  350,819  883  29,854  742,357 
Total CRE 2,227,606  10,088,330  7,002,633  1,943,204  21,261,773 
Total commercial 9,432,658   20,096,302   8,273,704   2,109,864   39,912,528  
Consumer:
Residential mortgage:
Single-family residential 1,706  4,662  1,225,792  13,770,389  15,002,549 
HELOCs 18  2,086  69,382  1,840,411  1,911,897 
Total residential mortgage 1,724  6,748  1,295,174  15,610,800  16,914,446 
Other consumer 16,894  30,335  3,969  —  51,198 
Total consumer 18,618   37,083   1,299,143   15,610,800   16,965,644  
Total loans held-for-investment $ 9,451,276   $ 20,133,385   $ 9,572,847   $ 17,720,664   $ 56,878,172  

Distribution of loans to changes in interest rates:
Variable-rate loans $ 7,576,769  $ 16,565,061  $ 4,484,401  $ 4,710,511  $ 33,336,742 
Fixed-rate loans 1,803,047  2,443,855  2,041,943  4,859,312  11,148,157 
Hybrid adjustable-rate loans 71,460  1,124,469  3,046,503  8,150,841  12,393,273 
Total loans held-for-investment $ 9,451,276   $ 20,133,385   $ 9,572,847   $ 17,720,664   $ 56,878,172  

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Foreign Outstandings

The Company’s international branches, which include the branch in Hong Kong and the subsidiary bank’s branches in China, are subject to the general risks inherent in conducting business in foreign countries, such as regulatory, economic and political uncertainties, and foreign currency exchange rate risks. The following table presents the major financial assets held in the Company’s international branches as of December 31, 2025 and 2024:

December 31,
2025 2024
($ in thousands) Amount % of Total Consolidated Assets Amount % of Total Consolidated Assets
Hong Kong branch:
Cash and cash equivalents $ 860,332  1 % $ 730,227  1 %

AFS debt securities (1)
$ 684,513  1 % $ 752,840  1 %
Loans held-for-investment (2)
$ 1,133,442  1 % $ 968,973  1 %
Total assets $ 2,692,309  3 % $ 2,474,447  3 %

China subsidiary bank branches:

Cash and cash equivalents $ 640,986  1 % $ 656,971  1 %

AFS debt securities (3)
$ 128,600  0 % $ 127,582  0 %
Loans held-for-investment (2)
$ 1,223,236  2 % $ 1,141,444  2 %
Total assets $ 2,012,751  3 % $ 1,971,922  3 %

(1) Comprised of U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities, U.S. Treasury securities, and foreign government bonds as of both December 31, 2025 and 2024.
(2) Primarily comprised of C&I loans as of both December 31, 2025 and 2024.
(3) Comprised of foreign government bonds as of both December 31, 2025 and 2024.

The following table presents the total revenue generated by the Company’s international branches in 2025, 2024 and 2023:

Year Ended December 31,
2025 2024 2023
($ in thousands) Amount % of Total Consolidated Revenue Amount % of Total Consolidated Revenue Amount % of Total Consolidated Revenue
Hong Kong branch:

Total revenue $ 73,938  3 % $ 69,809  3 % $ 55,747  2 %

China subsidiary bank branches:
Total revenue $ 29,351  1 % $ 29,790  1 % $ 32,569  1 %

55

Deposits

Deposits are the Company’s primary source of funding, the cost of which has a significant impact on the Company’s net interest income and net interest margin. Additional funding is provided by short- and long-term borrowings, and long-term debt. See Item 7. MD&A — Risk Management — Liquidity Risk Management in this Form 10-K for a discussion of the Company’s liquidity management. The following table summarizes the Company’s deposits by product type as of December 31, 2025 and 2024:

December 31, 2025 December 31, 2024 Change
($ in thousands) Amount % Amount % $ %

Deposits by product:
Noninterest-bearing demand $ 16,697,099  25  % $ 15,450,428  24  % $ 1,246,671  8  %
Interest-bearing checking 7,989,255  12  % 7,940,692  13  % 48,563  1  %
Money market 15,439,729  23  % 14,816,511  23  % 623,218  4  %
Savings 1,671,804  2  % 1,751,620  3  % (79,816) (5) %
Time deposits 25,284,814  38  % 23,215,772  37  % 2,069,042  9  %
Total deposits $ 67,082,701   100   % $ 63,175,023   100   % $ 3,907,678   6  %

The Company’s strategy is to grow and retain relationship-based deposits to provide a stable and low-cost source of funding and liquidity. The Company offers a wide variety of deposit products to meet the needs of its consumer and commercial customers. As a result, we believe our deposit base is seasoned, stable and well-diversified. Total deposits of $67.1 billion as of December 31, 2025 increased $3.9 billion or 6%, compared with the prior year, primarily due to growth in time and noninterest-bearing demand deposits.

The following table provides a breakdown of the Company’s deposits by segment and region as of December 31, 2025 and 2024:

Change

($ in thousands)
December 31, 2025
December 31, 2024
$ %
Deposits by segment/region:

Consumer and Business Banking - U.S. (1)
$ 34,494,368  $ 32,832,926  $ 1,661,442  5  %
Commercial Banking - U.S. (1)
24,367,113  23,405,769  961,344  4  %
International Branches (2)
3,875,631  3,412,262  463,369  14  %
Treasury and Other - U.S. (3)
4,345,589  3,524,066  821,523  23  %
Total deposits $ 67,082,701   $ 63,175,023   $ 3,907,678   6   %

(1) Excludes deposits presented under International Branches.
(2) Deposits of our Hong Kong branch and China subsidiary bank branches are a subset of Commercial Banking segment deposits.
(3) Treasury and Other segment deposits reflect wholesale, public funds, and brokered deposits, primarily managed by the Company’s Treasury department.

Customer deposit accounts in the U.S. offices are insured by the FDIC for up to $250,000. The deposits in the Company’s subsidiary bank in China and the branch in Hong Kong are insured by each jurisdiction’s deposit insurance authority for up to 500,000 RMB and 800,000 Hong Kong Dollars, respectively. Uninsured deposits represent the portion of deposit accounts that exceed the insurance limits of the FDIC and each foreign jurisdiction. The Company calculates its uninsured deposits based on the methodologies and assumptions used for regulatory reporting.

The following table presents total uninsured deposits by location as of December 31, 2025 and 2024:

($ in thousands) Domestic China Hong Kong Total

Uninsured deposits as of 12/31/2025
$ 33,431,037  $ 1,525,527  $ 2,230,760  $ 37,187,324 
Uninsured deposits as of 12/31/2024
$ 32,767,680  $ 1,453,223  $ 1,848,652  $ 36,069,555 

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Uninsured time deposits totaled $15.2 billion as of December 31, 2025. The following table presents the maturity distribution for uninsured customer time deposits by location as of December 31, 2025:

($ in thousands) Domestic China Hong Kong Total
Three months or less $ 5,675,930  $ 245,779  $ 1,390,501  $ 7,312,210 
Over three months through six months 4,613,729  170,569  80,090  4,864,388 
Over six months through 12 months 2,262,244  242,880  24,867  2,529,991 
Over 12 months 46,229  402,128  —  448,357 
Total $ 12,598,132   $ 1,061,356   $ 1,495,458   $ 15,154,946  

Uninsured deposits, per regulatory requirements, represent the portion of deposit accounts in U.S. offices that exceed the FDIC insurance limit as reported on Schedule RC-O Memo, Item 2 of the Bank’s Call Report. Management believes that presenting uninsured domestic deposits with an adjustment to exclude collateralized and affiliate deposits provides a more accurate view of the deposits at risk, given that collateralized deposits are secured, and affiliate deposits are not customer-facing and are eliminated in consolidation.

The following table summarizes the Company’s uninsured domestic deposit balances reported on Schedule RC-O Memo, Item 2 of the Bank’s Call Report as of December 31, 2025 and 2024, after certain adjustments:

($ in thousands) December 31, 2025 December 31, 2024
Uninsured deposits, per regulatory requirements (1)
$ 33,431,037  $ 32,767,680 
Less: Collateralized deposits (4,464,567) (4,781,377)
Affiliate deposits (131,106) (485,824)
Uninsured deposits, excluding collateralized and affiliate deposits (a) $ 28,835,364   $ 27,500,479  

Total domestic deposits per Call Report (b) $ 63,460,378   $ 60,326,394  
Uninsured deposits, excluding collateralized and affiliate deposits, ratio (a) / (b) 45   % 46   %

(1) Uninsured deposits, per regulatory requirements, represent the portion of deposit accounts in U.S. branches that exceed the FDIC insurance limit as reported on Schedule RC-O Memo, Item 2 of the Bank’s Call Report.

Additional information regarding the impact of deposits on net interest income, with a comparison of average deposit balances and rates, is provided in Item 7 — MD&A — Results of Operations — Net Interest Income in this Form 10-K. See also the discussion of the impact of deposits on liquidity in Item 7. MD&A — Liquidity Risk Management in this Form 10-K.

Capital

The Company maintains a strong capital base to support its anticipated asset growth, operating needs, and credit risk exposures, and to ensure that the Company and the Bank are in compliance with all regulatory capital guidelines. The Company engages in regular capital planning processes on at least an annual basis to optimize the use of available capital and to appropriately plan for future capital needs, allocating capital to existing and future business activities. Furthermore, the Company conducts capital stress tests as part of its capital planning process. The stress tests enable the Company to assess the impact of adverse changes in the economy and interest rates on its capital base.

The Company’s stockholders’ equity increased $1.2 billion or 15% from $7.7 billion as of December 31, 2024 to $8.9 billion as of December 31, 2025. This increase was primarily due to $1.3 billion of net income and $240 million of other comprehensive income, partially offset by $335 million of cash dividends declared and $134 million from open-market common stock repurchases and tax withheld in the form of stock repurchase on vested RSUs. For other factors that contributed to the changes in stockholders’ equity, refer to Item 8. Financial Statements — Consolidated Statement of Changes in Stockholders’ Equity in this Form 10-K.

On January 22, 2025, the Company’s Board of Directors authorized the repurchase of up to $300 million of East West common stock, which will remain valid until December 31, 2026. The Company repurchased $115 million and $144 million of its common stock in 2025 and 2024, respectively.
57

The Company paid a cash dividend of $2.40 and $2.20 per share in 2025 and 2024, respectively. In January 2026, the Company’s Board of Directors declared a first quarter 2026 cash dividend of $0.80 per share, which represents a 33%, or 20 cents per common share, increase from the previous quarterly cash dividend of $0.60 per common share. The dividend was paid on February 17, 2026, to stockholders of record as of February 2, 2026.

Regulatory Capital and Ratios

The federal banking agencies have risk-based capital adequacy requirements intended to ensure that banking organizations maintain capital that is commensurate with the degree of risk associated with their operations. The Company and the Bank are each subject to these regulatory capital adequacy requirements. See Item 1. Business — Supervision and Regulation — Regulatory Capital Requirements and Regulatory Capital - Related Development in this Form 10-K for additional details.

The following table presents the Company’s and the Bank’s capital ratios as of December 31, 2025 and 2024 under the Basel III Capital Rules, and those required by regulatory agencies for capital adequacy and well-capitalized classification purposes:

Basel III Capital Rules
December 31, 2025 December 31, 2024 (1)

Company Bank Company Bank Minimum Regulatory Requirements Minimum Regulatory Requirements including Capital Conservation Buffer Well-Capitalized Requirements
Risk-based capital ratios:
CET1 capital (2)
15.1 % 13.9 % 14.3 % 13.4 % 4.5 % 7.0 % 6.5 %
Tier 1 capital (3)
15.1 % 13.9 % 14.3 % 13.4 % 6.0 % 8.5 % 8.0 %
Total capital 16.4 % 15.1 % 15.6 % 14.7 % 8.0 % 10.5 % 10.0 %
Tier 1 leverage (2)
10.9 % 10.0 % 10.4 % 9.8 % 4.0 % 4.0 % 5.0 %

(1) The Current Expected Credit Losses (“CECL”) transition provision permits certain banking organizations to exclude from regulatory capital the initial adoption impact of CECL, plus 25% of the cumulative changes in the allowance for credit losses under CECL for each period until December 31, 2021, followed by a three-year phase-out period in which the aggregate benefit is reduced by 25% in 2022, 50% in 2023 and 75% in 2024. Our capital ratios as of December 31, 2024 include a delay of 25% of the estimated impact of CECL on regulatory capital. The CECL transition was no longer in effect as of December 31, 2025.
(2) CET1 capital and Tier 1 leverage well-capitalized requirements apply to the Bank only. There are no well-capitalized requirements on CET1 capital ratio or Tier 1 leverage ratio for bank holding companies.
(3) Well-capitalized Tier 1 capital ratio requirements for the Company and the Bank are 6.0% and 8.0%, respectively.

The Company is committed to maintaining strong capital levels to assure its investors, customers and regulators that the Company and the Bank are financially sound. As of both December 31, 2025 and 2024, the Company and the Bank continued to exceed all “well-capitalized” capital requirements and the required minimum capital requirements under the Basel III Capital Rules. Total risk-weighted assets increased $2.8 billion from December 31, 2024 to $57.8 billion as of December 31, 2025, primarily due to loan growth.

Risk Management

Overview

In the normal course of business, the Company is exposed to a variety of risks, some of which are inherent to the financial services industry and others which are more specific to the Company’s business. The Company operates under a Board-approved ERM program. The Company’s ERM program outlines the company-wide approach to risk management and oversight, and describes the structures and practices employed to manage current and emerging risks inherent to the Company. The Company’s ERM program incorporates risk management throughout the organization in identifying, managing, monitoring, and reporting risks. It identifies the Company’s major risk categories as: credit, liquidity, market, operational, reputational, legal, compliance, BSA/AML & OFAC, strategic, and technology risk.

58

The ROC of the Board of Directors monitors the ERM program through such identified enterprise risk categories and provides oversight of the Company’s risk appetite and control environment. The ROC provides focused oversight of the Company’s identified enterprise risk categories on behalf of the full Board of Directors. Under the authority of the ROC, management committees apply targeted strategies to manage the risks to which the Company’s operations are exposed.

The Company’s ERM program is executed along the three lines of defense model, which provides for a consistent and standardized risk management control environment across the enterprise. The first line of defense is comprised of revenue generating, operational and support units. The second line of defense is comprised of risk management and control functions that provide independent risk oversight of first line activities and report to the Chief Risk Officer. The Chief Risk Officer reports to both the ROC and the Chief Executive Officer. The third line of defense is comprised of the Internal Audit and Independent Asset Review (“IAR”) functions. Internal Audit reports to the Chief Audit Executive (“CAE”) who reports to the Board’s Audit Committee. Internal Audit provides assurance and evaluates the effectiveness of risk management, control, and governance processes as established by the Company. IAR serves as an internal loan review and independent credit risk monitoring function within the Bank that works under the direction of the CAE and reports to the Audit Committee. IAR provides management and the Audit Committee with an objective and independent assessment of the Bank’s credit profile and credit risk management processes. Further discussion and analysis of selected primary risk areas are discussed in the following subsections of Risk Management.

Credit Risk Management

Credit risk is the risk that a borrower or a counterparty will fail to perform according to the terms and conditions of a loan, investment or derivative and expose the Company to loss. Credit risk exists with many of the Company’s assets and exposures such as loans, debt securities and certain derivatives. The majority of the Company’s credit risk is associated with lending activities.

The ROC has primary oversight responsibility for the identified enterprise risk categories including credit risk. The ROC monitors management’s assessment of asset quality, credit risk trends, credit quality administration, underwriting standards, and portfolio credit risk management strategies and processes, such as diversification and liquidity, all of which enable management to control credit risk. At the management level, the Credit Risk Management Committee has primary oversight responsibility for credit risk. The Senior Credit Supervision function manages credit policy for the line of business transactional credit risk, assuring that all exposure is risk-rated according to the requirements of the credit risk rating policy. The Senior Credit Supervision function in connection with the ERM function, also evaluates and reports the overall credit risk exposure to senior management and the ROC including concentration limits and key risk indicators. Reporting directly to the Board’s Audit Committee, the IAR function provides additional validation support to the Company’s robust credit risk management culture by performing an independent and objective assessment of underwriting and documentation quality and serves as an assurance function for the risk rating of the Company’s loan portfolios. A key focus of our credit risk management is adherence to a well-controlled underwriting and loan monitoring process.

The Company assesses the overall performance and credit quality of the loans held-for-investment portfolio through an integrated analysis of specific performance ratios. This approach forms the basis of the discussion in the sections immediately following: Credit Quality, Nonperforming Assets, and Allowance for Credit Losses.

Credit Quality

The Company utilizes a credit risk rating system to assist in monitoring credit quality. Loans are evaluated using the Company’s internal credit risk rating of 1 through 10. For more information on the Company’s credit quality indicators and internal credit risk ratings, refer to Note 6 — Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements in this Form 10-K.

59

The following table presents the Company’s criticized loans as of December 31, 2025 and 2024:

Change
($ in thousands) December 31, 2025
December 31, 2024
$ %
Criticized loans:
Special mention loans $ 344,876  $ 447,290  $ (102,414) (23) %
Classified loans (1)
796,273  725,863  70,410  10  %
Total criticized loans (2)
$ 1,141,149   $ 1,173,153   $ (32,004) (3) %

Special mention loans to loans held-for-investment 0.61  % 0.83  %
Classified loans to loans held-for-investment 1.40  % 1.35  %
Criticized loans to loans held-for-investment 2.01  % 2.18  %

(1) Consists of substandard, doubtful and loss categories.
(2) Excludes loans HFS.

Criticized loans decreased by $32 million or 3%, to $1.1 billion from December 31, 2024, primarily driven by decreases in C&I and multifamily residential loans, partially offset by increases in CRE and construction and land loans.

Nonperforming Assets

Nonperforming assets are comprised of nonaccrual loans, OREO and other nonperforming assets. Other nonperforming assets and OREO are repossessed assets and properties, respectively, acquired through foreclosure, or through full or partial satisfaction of loans held-for-investment. Nonperforming assets may also include nonperforming loans HFS.

The following table presents nonperforming assets information as of December 31, 2025 and 2024:

Change
($ in thousands) December 31, 2025
December 31, 2024
$ %
Commercial:
C&I $ 52,244  $ 86,165  $ (33,921) (39) %
CRE:
CRE 38,546  2,430  36,116  NM
Multifamily residential 292  4,572  (4,280) (94) %
Construction and land 27,810  11,316  16,494  146  %
Total CRE 66,648  18,318  48,330  264  %
Consumer:
Residential mortgage:
Single-family residential 29,641  32,423  (2,782) (9) %
HELOCs 17,167  22,046  (4,879) (22) %
Total residential mortgage 46,808  54,469  (7,661) (14) %
Other consumer 142  66  76  115  %
Total nonaccrual loans 165,842  159,018  6,824  4  %
OREO, net 21,183  35,077  (13,894) (40) %

Nonperforming loans HFS 20,976  —  20,976  100  %
Total nonperforming assets $ 208,001   $ 194,095   $ 13,906   7   %
Nonperforming assets to total assets 0.26 % 0.26 %
Nonaccrual loans to loans held-for-investment 0.29 % 0.30 %
ALLL to nonaccrual loans 488.28 % 441.49 %

NM — Not meaningful.

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Loans are generally placed on nonaccrual status at the earlier of when they become 90 days past due or when the full collection of principal or interest becomes uncertain regardless of the length of past due status. Collectability is generally assessed based on economic and business conditions, the borrower’s financial condition and the adequacy of collateral, if any. For additional details regarding the Company’s nonaccrual loan policy, see Note 1 — Summary of Significant Accounting Policies — Significant Accounting Policies — Loans Held-for-Investment to the Consolidated Financial Statements in this Form 10-K.

Nonaccrual loans of $166 million as of December 31, 2025 increased $7 million or 4% from December 31, 2024, primarily driven by increases in CRE and construction and land due to additional loans being transferred to nonaccrual status, partially offset by a decrease in C&I nonaccrual loans due to charge offs and transfers to OREO. As of December 31, 2025, $27 million or 16% of nonaccrual loans were less than 90 days delinquent. In comparison, $49 million or 31% of nonaccrual loans were less than 90 days delinquent as of December 31, 2024.

The following table presents the accruing loans past due by portfolio segment as of December 31, 2025 and 2024:

Total Accruing Past Due Loans (1)
Change Percentage of Total Loans Outstanding

($ in thousands) December 31, 2025
December 31, 2024
$ % December 31, 2025
December 31, 2024

Commercial:
C&I $ 26,044  $ 22,855  $ 3,189  14  % 0.14  % 0.13  %
CRE:
CRE 13,994  5,640  8,354  148  % 0.09  % 0.04  %
Multifamily residential 1,253  931  322  35  % 0.02  % 0.02  %
Construction and land —  927  (927) (100) % 0.00  % 0.14  %
Total CRE 15,247  7,498  7,749  103  % 0.07  % 0.04  %
Total commercial 41,291   30,353   10,938   36   % 0.10   % 0.08   %
Consumer:
Residential mortgage:
Single-family residential 73,684  54,937  18,747  34  % 0.49  % 0.39  %
HELOCs 34,650  19,364  15,286  79  % 1.81  % 1.07  %
Total residential mortgage 108,334  74,301  34,033  46  % 0.64  % 0.46  %
Other consumer 77  107  (30) (28) % 0.15  % 0.16  %
Total consumer 108,411   74,408   34,003   46   % 0.64   % 0.46   %
Total $ 149,702   $ 104,761   $ 44,941   43   % 0.26   % 0.19   %

(1) There were no accruing loans past due 90 days or more as of both December 31, 2025 and 2024.

Allowance for Credit Losses