East West Bancorp Sets New Records in Q3 2026 with Strong Performance and Prudent Growth
East West Bancorp delivered a remarkable performance in the third quarter of 2026, setting new records for revenue, net interest income, pre-tax, pre-provision income, and diluted earnings per share. The company's Chairman and Chief Executive Officer, Dominic Ng, highlighted the value of its customers' relationships and the resilience of its business model as key factors behind these achievements.
Deposits reached new record levels, with over $1.4 billion in net deposit growth, driven by inflows of money market deposits. Notably, East West reduced its average deposit cost in the third quarter by 2 basis points, even as it grew balances to record levels. This controlled approach to deposit costs will continue into the fourth quarter, according to Ng.
Lending also hit records this quarter, with prudent growth led by residential and multifamily lending. The company's balance sheet growth contributed to record net interest income, which is up 9.5% year-over-year for the nine months through September. As a result, East West raised its full-year guidance today.
Asset quality remained solid, with charge-offs, non-performing assets, and criticized loans well-controlled and within expectations. Given this performance, the company also updated its net charge-off guidance lower for the year. East West's diversified business model, conservatively managed balance sheet, and industry-leading profitability enable it to deliver an over 17% return on average tangible common equity while maintaining a greater than 10% tangible common equity ratio.
Chris Del Moral-Niles, Chief Financial Officer, provided a more detailed review of the company's financial results. He highlighted the broad-based deposit growth quarter and encouraged by strong money market deposit growth. Non-interest-bearing demand deposits continue to represent over 26% of total deposits at quarter end, providing stable funding and supporting deposit cost management.
Loans grew 7% year-over-year, consistent with East West's full-year 2026 guidance. Residential mortgage came in as the standout this quarter, with nearly $400 million of net growth. The company continues to expect residential mortgage to be a key contributor to its growth due to its robust current pipeline.
The net interest margin expanded by 6 basis points quarter-over-quarter, driven by positive asset repricing and flat liability costs. Given September's rate hike and the strong third quarter performance, East West now expects full-year NII growth of 9-10%. This guidance assumes short-term rates remain at current levels through December.
