XML 41 R25.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Regulatory Requirements and Matters | 12 Months Ended
--- | ---
Dec. 31, 2017
Banking and Thrift [Abstract] |
Regulatory Requirements and Matters | Regulatory Requirements and Matters Capital Adequacy — The Company and the Bank are subject to regulatory capital adequacy requirements administered by the federal banking agencies. The Bank is a member bank of the Federal Reserve System and the Federal Reserve Bank is the Bank’s primary regulator. Effective January 1, 2015, the Company and the Bank are required to comply with the Basel III Capital Rules adopted by the Federal Reserve Bank. The capital requirements under the Basel III framework, among other things, prescribed a new standardized approach for determining risk-weighted assets used in calculating capital ratios, increased minimum required capital ratios, and introduced a minimum Common Equity Tier 1 (“CET1”) capital ratio to ensure that banking organizations hold sufficient high quality regulatory capital that is available to absorb losses on a going-concern basis. The Basel III Capital Rule requires that banking organizations maintain a minimum CET1 capital ratio of 4.5%, a Tier 1 capital ratio of 6.0%, and a total capital ratio of 8.0% to be considered adequately capitalized. Failure to meet minimum capital requirements can result in certain mandatory actions and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s Consolidated Financial Statements. The Federal Deposit Insurance Corporation Improvement Act of 1991 requires that the federal regulatory agencies adopt regulations defining capital categories for banks: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized. Consistent with the Basel III Capital Rules, the capital categories were augmented by including the CET1 capital measure, and revised risk-based capital measures to reflect the rule changes to the minimum risk-based capital ratios. As of December 31, 2017 and 2016, the Company and the Bank were both categorized as well capitalized based on applicable U.S. regulatory capital ratio requirements in accordance with Basel III standardized approaches, as set forth in the table below. The Company believes that no changes in conditions or events have occurred since December 31, 2017, which would result in changes that would cause the Company or the Bank to fall below the well capitalized level. The following table presents the regulatory capital information of the Company and the Bank as of December 31, 2017 and 2016:
|  | Basel III
|  | December 31, 2017 |  | December 31, 2016
($ in thousands) |  | Actual |  | Minimum Requirement |  | Well Capitalized Requirement |  | Actual |  | Minimum Requirement |  | Well Capitalized Requirement
| Amount |  | Ratio |  | Ratio |  | Ratio |  | Amount |  | Ratio |  | Ratio |  | Ratio
Total capital (to risk-weighted assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 3,838,516 |  |  | 12.9 | % |  | 8.0 | % |  | 10.0 | % |  | $ | 3,400,642 |  |  | 12.4 | % |  | 8.0 | % |  | 10.0 | %
East West Bank |  | $ | 3,679,261 |  |  | 12.4 | % |  | 8.0 | % |  | 10.0 | % |  | $ | 3,371,885 |  |  | 12.3 | % |  | 8.0 | % |  | 10.0 | %
Tier 1 capital (to risk-weighted assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 3,390,070 |  |  | 11.4 | % |  | 6.0 | % |  | 8.0 | % |  | $ | 2,976,002 |  |  | 10.9 | % |  | 6.0 | % |  | 8.0 | %
East West Bank |  | $ | 3,378,815 |  |  | 11.4 | % |  | 6.0 | % |  | 8.0 | % |  | $ | 3,095,245 |  |  | 11.3 | % |  | 6.0 | % |  | 8.0 | %
CET1 capital (to risk-weighted assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 3,390,070 |  |  | 11.4 | % |  | 4.5 | % |  | 6.5 | % |  | $ | 2,976,002 |  |  | 10.9 | % |  | 4.5 | % |  | 6.5 | %
East West Bank |  | $ | 3,378,815 |  |  | 11.4 | % |  | 4.5 | % |  | 6.5 | % |  | $ | 3,095,245 |  |  | 11.3 | % |  | 4.5 | % |  | 6.5 | %
Tier 1 leverage capital (to adjusted average assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 3,390,070 |  |  | 9.2 | % |  | 4.0 | % |  | 5.0 | % |  | $ | 2,976,002 |  |  | 8.7 | % |  | 4.0 | % |  | 5.0 | %
East West Bank |  | $ | 3,378,815 |  |  | 9.2 | % |  | 4.0 | % |  | 5.0 | % |  | $ | 3,095,245 |  |  | 9.1 | % |  | 4.0 | % |  | 5.0 | %
Risk-weighted assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 29,669,251 |  |  | N/A |  |  | N/A |  |  | N/A |  |  | $ | 27,357,753 |  |  | N/A |  |  | N/A |  |  | N/A |
East West Bank |  | $ | 29,643,711 |  |  | N/A |  |  | N/A |  |  | N/A |  |  | $ | 27,310,540 |  |  | N/A |  |  | N/A |  |  | N/A |
Adjusted quarterly average total assets (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 37,307,975 |  |  | N/A |  |  | N/A |  |  | N/A |  |  | $ | 34,209,827 |  |  | N/A |  |  | N/A |  |  | N/A |
East West Bank |  | $ | 37,283,273 |  |  | N/A |  |  | N/A |  |  | N/A |  |  | $ | 34,163,667 |  |  | N/A |  |  | N/A |  |  | N/A |
(1) | Reflects adjusted average total assets for the years ended December 31, 2017 and 2016.
N/A — Not applicable. Reserve Requirement — The Bank is required to maintain a percentage of its deposits as reserves at the Federal Reserve Bank of San Francisco (the “FRB”). The daily average reserve requirement was approximately $699.4 million and $503.8 million as of December 31, 2017 and 2016, respectively. Regulatory Matters — The Bank entered into a Written Agreement, dated November 9, 2015, with the Federal Reserve Bank of San Francisco (the “Written Agreement”), to correct less than satisfactory Bank Secrecy Act (“BSA”) and Anti-Money Laundering (“AML”) programs detailed in a joint examination by the FRB and the California Department of Business Oversight (“DBO”). The Bank also entered into a related MOU with the DBO in 2015. The Written Agreement, among other things, requires the Bank to enhance the compliance programs related to the BSA and AML and Office of Foreign Assets Control (“OFAC”) laws, rules and regulations and retain an independent firm to conduct a review of the account and transaction activity covering a six-month period to determine whether any suspicious activity was properly identified and reported in accordance with applicable regulatory requirements. The Company believes that it is making progress in executing the compliance plans and programs required by the Written Agreement and MOU, although there can be no assurances that our plans and progress will be found to be satisfactory by our regulators. To date, the Company has added significant resources to comply with the Written Agreement and MOU, and to address any additional findings or recommendations by the regulators. If additional compliance issues are identified or if the regulators determine that the Bank has not satisfactorily complied with the terms of the Written Agreement, the regulators could take further actions with respect to the Bank and, if such further actions were taken, such actions could have a material adverse effect on the Bank. The operating and other conditions in the BSA and AML program and the auditing and oversight of the program that led to the Written Agreement and MOU could also lead to an increased risk of being subject to additional actions by the FRB and DBO, an increased risk of future examinations that may downgrade the regulatory ratings of the Bank, and an increased risk investigations by other government agencies may result in fines, penalties, increased expenses or restrictions on operations.

X
- References No definition available. + Details
Name: | us-gaap_BankingAndThriftAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for banks, savings institutions, and credit unions, for regulatory capital requirements imposed by the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office of Thrift Supervision (OTS) or for any state imposed capital requirements, as applicable. The disclosure may include (1) a description of regulatory capital requirements (a) for capital adequacy purposes and (b) established by the prompt corrective action provisions of Section 38 of the Federal Depository Insurance Act; (2) the actual or possible material effects of noncompliance with such requirements; (3) whether the entity is in compliance with the regulatory capital requirements including (a) required and actual ratios and amounts of Tier 1 leverage, Tier 1 risk-based, and total risk-based capital, tangible capital (for savings institutions), and Tier 3 capital for market risk (for certain banks and bank holding companies), (b) factors that may significantly affect capital adequacy; (4) the prompt corrective action category in which the entity was classified as of its most recent notification; (5) whether management believes any conditions or events since notification have changed the entity's category. Also may include additional information that might be disclosed in situations where substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1G -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958577-112826 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1C -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958572-112826 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1E -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958574-112826 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1H -URI http://asc.fasb.org/extlink&oid=84167132&loc=d3e65071-112826 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958569-112826 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958570-112826 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1F -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958575-112826 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958568-112826 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1D -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958573-112826 + Details
Name: | us-gaap_RegulatoryCapitalRequirementsUnderBankingRegulationsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration