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Financial Data For East West Bank

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PART A: Executive Summary
For this paper, selected financial data for East West Bank (“EWB” or the “Bank”) and its Peer Group (“peers”) was obtained from the December 31, 2013 Uniform Bank Performance Report (“UBPR”) and various EWB documents ; as well as from interviews conducted with EWB management .

The Board of Directors’ Loan Policy Statements, presented in this Lending Policy Manual, set forth the lending philosophy of the Bank. They provide broad guidance to management in balancing loan quality and origination objectives to achieve the earnings objectives of the Bank.

Every institution needs to accept some risk in order to earn profits; in line with their accepted risk profile and within established risk appetite. EWB’s “Risk
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Consider using credit scoring for loans below risk threshold – auto decision
As such, it is expected that the level of losses will remain low and that the Company will not incur the same level of losses in the future that were incurred in the past during the credit crisis unless the economy is reversing its recovery. PART B: Strategic Credit Risk Management
In looking across the Continua, with each plotted “X” forming a reasonably straight line somewhat towards the middle, the magnitude of risk seems to be moderate, as analyzed below:
1. Priorities: The Bank is focused on “Growth”; while maintaining high credit quality and solid earnings. This is evidenced by the $2.5 billion or 14% increase in loan receivable balance as of December 31, 2014; largely due to the growth in commercial and industrial (“C&I”) loans. Management intends to further grow this portfolio in order to sustain its prominent market position, diversify the portfolio and increase fee-based income streams. Considering that management does not have high tolerance for risk, various steps have been taken, including hiring experienced RMs and providing training commensurate with the degree of unique risk and complexity of these specialized (wide-spectrum of industries) loans; and implementing changes to P&Ps to require heightened monitoring to manage volatility and avoid surprises.
2. Culture: “A bank’s credit culture reflects its
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