East West Bancorp (NASDAQ:EWBC) executives said 2025 marked a “record-breaking year,” with the company posting new full-year highs across several key financial line items and outlining expectations for continued growth in 2026 despite an uncertain rate and economic backdrop.
On the company’s fourth-quarter 2025 earnings call, Chairman and CEO Dominic Ng said East West reached record levels for revenue, net interest income, fees, non-interest income, earnings per share, loans, and deposits. Ng added that the bank’s performance reflects a business model built to “deliver meaningful values to clients,” particularly during periods of uncertainty. He also highlighted shareholder metrics, saying the bank delivered 17% tangible book value per share growth and a 17% return on tangible common equity in 2025.
Deposits and loan growth highlighted in 2025 results
Chief Financial Officer Chris Del Moral-Niles said East West’s core deposit growth helped fund loan growth and improve liquidity. The bank grew end-of-period deposits by 6% year over year, with Ng noting traction in both non-interest-bearing deposits and time deposits.
Del Moral-Niles said the bank prioritized deposit growth through a business checking campaign during 2025 and plans to keep that focus in 2026. He added that DDA levels improved 1% in the fourth quarter to 25% of total deposits.
On the lending side, East West grew end-of-period loans by 6% year over year, with Del Moral-Niles saying average loans rose 4% for the year, led by commercial and industrial (C&I) growth. He described fourth-quarter C&I growth as driven primarily by new relationships and said the pipeline suggests C&I will continue to lead lending growth in 2026. Residential mortgage production was also described as strong in the fourth quarter, with pipelines “full” going into the first quarter.
For 2026, management guided to total loan growth of 5% to 7%, driven by C&I and residential mortgages. Responding to questions about whether loan growth could exceed that range, Del Moral-Niles said the bank wanted to be mindful of seasonality and patterns observed in prior years. Ng added that while 2026 “is looking pretty good,” economic forecasting can be difficult, and the bank remains focused on outperforming peers through varying conditions.
Net interest income benefits from deposit repricing and mix
Del Moral-Niles said fourth-quarter net interest income was $658 million, supported by balance sheet growth, favorable deposit mix shifts, and “short-term liability sensitivity” during a quarter that included two interest rate cuts. He said the bank continued to reduce deposit costs, with period-end cost of deposits down another 23 basis points quarter over quarter.
Looking back to the beginning of the rate-cutting cycle, Del Moral-Niles said East West lowered interest-bearing deposit costs by 105 basis points against 175 basis points of Federal Reserve cuts, producing a down-cycle beta of 0.6 while growing total deposits by nearly $4 billion over the year. In response to an analyst question, he said the bank expects deposit betas to “exceed 0.5” as rates move lower, while acknowledging that additional reductions become more challenging as rates grind down.
For 2026, the bank guided to net interest income growth of 5% to 7%, which Del Moral-Niles said should be driven by expected balance sheet growth even as the bank is “modestly otherwise asset-sensitive.” He noted that his outlook assumption included three rate cuts totaling 75 basis points over the course of 2026 and a gradually steepening yield curve implied by year-end forwards. Later in the call, management also discussed near-term dynamics, describing a short-term benefit immediately following rate cuts and a reversion to the broader asset-sensitive profile after the initial period.
Fee income and expense outlook
Management emphasized fee-based momentum. Del Moral-Niles said fee income grew 12% in 2025, driven by “sustained quality execution” across wealth management, derivatives, foreign exchange, deposit fees, and lending fees. He said investments in the global treasury group have produced traction in treasury management activity, while wealth management fee growth has been supported by hiring financial consultants and licensed bankers.
For 2026, Del Moral-Niles said the company aspires to grow fee income faster than balance sheet growth and reiterated a desire to continue delivering double-digit fee growth over time. He also told analysts the bank remains open to inorganic opportunities to supplement organic growth, but stressed that the bar for acquisitions is high given the pace of organic fee expansion and the need to weigh “buy versus build.”
On expenses, Del Moral-Niles highlighted what he called “industry-leading efficiency,” citing a 34.5% efficiency ratio in the fourth quarter. Total operating non-interest expense rose 7.5% in 2025 as the bank invested in expertise, systems, and technology to support growth. For 2026, East West expects operating expenses to increase 7% to 9%, driven by headcount additions and IT-related expenditures. When asked where spending is concentrated, Del Moral-Niles pointed to technology costs such as data processing, software, and computer expenses, as well as consulting costs and hiring across wealth, commercial banking, technology, and risk management.
Asset quality remains strong; capital and hedging discussed
Oh said asset quality metrics “continue to broadly outperform the industry.” The bank recorded net charge-offs of 8 basis points, or $12 million, in the fourth quarter and 11 basis points, or $60 million, for full-year 2025. Provision for credit losses was $30 million in the fourth quarter versus $36 million in the third quarter. Non-performing assets were stable at 26 basis points of total assets at year-end, and criticized loans declined to 2.01% from 2.14% in the prior quarter.
For 2026, the bank projected net charge-offs of 20 to 30 basis points. Oh said the guidance reflects the reality that “from time to time, individual credits can turn,” while adding there are “no systemic issues” visible in current metrics. She also said the allowance for credit losses increased to $810 million from $791 million in the fourth quarter, maintaining a reserve ratio of 1.42%, and that the portfolio is “appropriately reserved” under the bank’s CECL framework and macroeconomic assumptions.
On capital, Oh said regulatory ratios remain well above requirements. East West reported a Common Equity Tier 1 ratio of 15.1% and a tangible common equity ratio of 10.5%. Management said strong capital supports the bank’s client service model and provides resilience amid potential volatility. Ng also said share repurchases will remain “opportunistic,” with flexibility preserved for organic growth and potential inorganic opportunities.
Executives also addressed hedging and securities positioning. Del Moral-Niles said cash hedge headwinds narrowed to $2 million in the fourth quarter from more than $20 million per quarter earlier in the year, and he expects hedges to become tailwinds in 2026 as rate cuts continue. On securities, management said it has leaned more toward fixed-rate purchases based on relative value and expectations for additional rate cuts.
About East West Bancorp (NASDAQ:EWBC)
East West Bancorp, Inc is a bank holding company and the parent of East West Bank, one of the largest independent banks headquartered in Southern California. As a full-service commercial bank, it provides a broad range of financial products and services to business and individual customers, including commercial and residential real estate lending, working capital lines of credit, trade finance, and deposit and treasury management services. The company caters to both large and middle-market businesses, leveraging its expertise to serve clients engaged in cross-border trade and investment between the United States and Greater China.
Founded in Los Angeles in the early 1970s, East West Bank has grown steadily through organic expansion and strategic branch openings.
