East West Bancorp, Inc.: 2Q26 Review

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East West Bancorp, Inc.: 2Q26 Review

Barclays | East West Bancorp, Inc.

management raised FY loan growth guidance to 6-8% from 5-7%. While our outlook for 2H26 is

generally unchanged, we reduce our FY26 loan growth assumption to 7.0% but are keeping our

expectations for 27/28 unchanged in the 6-6.5% range.

Fees/Expenses: Fee income remains a positive differentiator even after several strong quarters

in a row. Core fee income of $104.3MM increased 0.3% Q/Q from a record 1Q level and was 21%

higher Y/Y, supported by lending fees, deposit-related fees and wealth management. Wealth

management fees declined $2.8MM sequentially following an exceptionally strong 1Q, though

revenue remains up 71% Y/Y through the first half of the year as management continues to

invest in advisors, platforms and product capabilities. Total fee income of $106MM exceeded our

estimate by ~7%. Expenses were the primary offset, with 2Q's $290.6MM coming in ~4% above

our estimate. Management attributed much of the increase to deferred compensation and a

change in vacation-related accruals, both of which should moderate in 2H26. As a result,

expense guidance was narrowed to 8-9% growth from the prior range of +7-9% while

maintaining expectations for industry-leading efficiency.

Credit/Capital: Credit quality remains strong and capital levels are at the top of the group.

Provision expense declined to $33MM from $36MM, reserves remained stable at 1.43% of loans,

and management reiterated confidence in the quality of the portfolio. NCOs increased to 0.10%

from 0.08% in 1Q, though management characterized asset quality trends as broadly stable and

continues to expect full-year NCOs within the 15-25bp range. NPAs increased modestly to 0.29%