Cathay General Bancorp

At this time, all participant lines are in a listen-only mode. Following the prepared remarks, there will be a question-and-answer session. If you would like to participate in this portion of the call, please press star, followed by one at any time during the conference. If assistance is needed any time during the call, please press star, followed by zero, and a coordinator will be happy to assist you. Today's call is being recorded and will be available for replay at www.sageneralbancorp.com. Now I would like to turn the call over to Georgia Lo, Investor Relations of Cathay General Bancorp. May I please begin?

Thank you, Justin, and good afternoon. Here to discuss the financial results today are Mr. Pin Tai, our Chief Executive Officer, Mr. Chang Liu, Cathay Bank's President and Chief Operating Officer, and Mr. Hang Chen, our Executive Vice President and Chief Financial Officer. Before we begin, we wish to remind you that the speakers on this call may make forward-looking statements within the meaning of the applicable provisions of the Private Securities Litigation Reform Act of 1995 concerning future results and events, and that these statements are subject to certain risks and uncertainties that could cause actual results to differ materially. These results and uncertainties are further described in the company's annual report on Form 10-K for the year ended December 31, 2019, at Item 1A in particular, and in other reports and filings with the Securities Exchange Commission from time to time. As such, we caution you not to place undue reliance on such forward-looking statements. Any forward-looking statement speaks only as of the date of which it is made and except as required by law. We undertake no obligations to update or review any forward-looking statements to reflect future circumstances, developments or events or the occurrence of unanticipated events. This afternoon, Cafe General Bancorp issued an earnings release outlining its first quarter 2020 results. To obtain a copy, please visit our website at www.cafegeneralbancorp.com. After comments by management today, we will open up this call for questions. I will now turn the call over to our Chief Executive Officer, Mr. Pintai.

Thank you, Georgia, and good afternoon. Welcome to our 2020 First Quarter Earnings Conference Call. I will acknowledge Our commitment and focus today is on supporting our clients, team members, and communities during the COVID-19 pandemic. This afternoon, we reported net income of $46.9 million for the first quarter of 2020, a 29.7% decrease when compared to our net income of $66.7 million for the first quarter of 2019. Valued earnings per share decreased 29% to $0.59 per share for the first quarter of 2020 compared to $0.83 per share for the same quarter a year ago. The first quarter 2020 results include a special loan loss provision of $22 million for loans losses due to deteriorations in economic conditions in the closing weeks of the quarter. related to COVID-19. This special provision reduced earnings per share by 19 cents. In the first quarter of 2020, our gross loans grew by $458.7 million to $15.5 billion, or an increase of 12.2% on an annualized basis. The increase in loans for the first quarter of 2020 was primarily driven by the growth in commercial loans of 194.3 million due in part to higher drawdown by our borrowers or 28% annualized. Commercial mortgage loans of 147.3 million or 8.1% annualized and residential mortgage loans of 85.3 million or 8.3% annualized. For the first quarter of 2020, our total deposits increased 397.8 million or 10.8% annualized to $15.1 billion primarily as the result of new depositors and additional wholesale deposits. We continue our stock buyback program and we purchase 400,000 shares of our stock at an average cost of $32.20 per share in the first quarter of 2020. We will not be buying back any additional shares until further notice. We will continue to monitor the impact of the COVID-19 pandemic on our financial results as well as demand for loans, deposits, services and products during the second quarter of 2020 and beyond. With that, I'll turn the floor over to the Bank's President and Chief Operating Officer, Chang Liu, to discuss our first quarter asset quality in more detail and our COVID-19 initiatives for our borrowers.