Pasadena-based East West Bank is entering 2026 on firm footing.
In a banking sector still recalibrating after a volatile interest rate cycle, balance sheet strength and capital remain king. East West Bank, serving business clients across the U.S. and Asia, closed 2025 with a record net income of roughly $1.3 billion, alongside loan and deposit growth, according to its year-end filing.
Organic growth and strategic branch openings have made East West Bank, founded in Chinatown in 1973, the largest independently owned bank based in Southern California by assets – of which it counts $80.4 billion.
In the current environment, defined by unpredictable macroeconomic shifts and regulatory scrutiny, it seems East West’s nest egg is serving it well – and pleasing investors. Shares of the bank’s parent company, East West Bancorp Inc., rose 24% year-over-year, closing at $116.50 on Thursday. East West has traded publicly since 1999.
For a look at where the bank is placing its bets this year and how it’s thinking about capital and risk, the Business Journal sat down with Chief Financial Officer Christopher Del Moral-Niles.
What areas of focus is East West Bank leaning into in 2026?
We certainly have had a focused effort to expand our penetration of small business banking across the region, specifically in Southern California. That was a particular source of success in 2025 and helped us garner over half a billion dollars of new predominantly small business checking deposits in 2025.
We’ve been very pleased by the ability of our branch managers to connect with the businesses in their communities, to support our community based partners across the Southern California region, and to make more inroads along Valley Boulevard and Rosie Boulevard and Huntington in our various markets, along with in our surrounding markets, in places like Encino and Glendale and Irvine. Our expansion is particularly notable in Texas, where we’ve had great success and made great strides in deepening our deposit base.
In markets such as Boston and Long Island in the New York metro area, I have found additional opportunities where East West could meaningfully expand and drive additional deposit creation and business opportunities and really support the furthering and continued expansion of our core customers in the growing communities they’re expanding into.
To prevent the fallout that sank a handful of California’s regional banks in 2023, supervisors have continued to press banks to demonstrate liquidity and loss-absorbing capacity. How are evolving regulations influencing East West Bank’s approach to capital planning and risk appetite?
The environment has shifted dramatically over the last 18 to 24 months. In particular, under the current administration, I would say that the focus has shifted towards things that drive safety and soundness as regulatory primary forces that the regulators have turned their attention to.
It’s become less about checklists and reporting and more about, “Is your bank strong and liquid enough to weather through whatever storm may come next?”
This plays particularly well into East West’s strength, as we are amongst the best capitalized banks in the industry, and we are amongst the most liquid banks, certainly in our peer group. We clearly see ourselves as very well positioned for how the regulatory winds are shifting.
East West Bank recently announced a partnership with Worldpay for payment solutions. What is this agreement’s strategic importance? What changes are you seeing to your clients’ payments needs?
Providing payment solutions is everyday business at East West Bank and, given our global client base, providing payments to them on a global basis is very important to us and something we want to make sure we have the fullest suite of solutions in our ecosystem to support all of their needs.
We’ve seen, specifically on the smaller retailers along the prototypical Valley Boulevard or Rosemead Boulevard or Huntington here in the San Gabriel Valley, their needs evolved from just being a point-of-sale terminal at some central desk to, in the case of restaurants, handheld devices and, in the case of small businesses, multiple smaller devices that can be positioned closer to entries or exits for the customers.
WorldPay has provided us with some of those hardware solutions that have made that easier. On the other hand, from a global payment perspective, we at East West Bank have internally developed a more rapid way of transmitting funds (and) better facilitating our ability to transmit real-time funds transfers between the U.S. and Hong Kong, which is generating additional wire activity and additional foreign exchange activity.
Even with easing stress in the commercial real estate sector, East West Bank’s CRE growth remains constrained. What factors are keeping CRE cautious for the bank?
The bank has been trying to persistently meet the expectations and demands of our CEO (Dominic Ng), who has laid out a vision for the bank to be very well-diversified: a third core commercial-and-industrial-oriented, a third single-family-oriented, and a third commercial-real estate-oriented. We are moving the portfolio mix from a risk profile and diversification and long-term strategic perspective.
That’s not to say that we’re shrinking our CRE activities. We’re really focusing our growth on our core CNI and single-family portfolios going forward, and only on supporting our customers in the CRE space today. That is not driven by a market constraint. There’s plenty of market out there. It’s driven by our discipline and recognition that to be the strong, sustained growth, sustained risk, managed bank that we want to be, we will be better served to be a better diversified bank over time, and that we shouldn’t let ourselves become CRE-centric.
The deposit market has tightened significantly, and rate expectations are shifting to a “higher-for-longer” scenario. How is the bank navigating the current environment, and how will it achieve its 5-7% planned loan and net interest income growth?
In 2025, (we saw) record levels of deposits, record levels of loans and record levels of earnings for East West Bank. We clearly see our ability to attract deposits as core to our sustainable competitive advantage.
We expect to grow our net interest income in line with our overall loan growth profile. We expect to fully fund our growth with deposits from our customers, and so we think all of that goes together to support an expanding balance sheet. We already have the capital support and therefore a growing net interest income profile.
Expectations have shifted a bit, and I think there was probably an expectation, at least at some point in 2025, that there will be multiple rate cuts in 2026. I think the plausibility of that outlook, following the most recent employment numbers and GDP numbers, has dialed back a bit, but East West Bank is well-positioned to benefit from a higher-for-longer environment. In fact, we are what the industry refers to as asset-sensitive, so lower rates in general would have an effect of dampening our net interest income growth, and higher-for-longer would actually have the effect of increasing our management growth. That does cut against another side: Higher rates will make CRE deals more difficult for people to finance or refinance. However, since that’s not a growth engine for us, higher-for-longer is just better for us.
Are there any other headwinds you foresee as potential obstacles to reaching those growth figures?
One we do foresee in a higher-for-longer world is the likelihood of a tightening deposit market overall. We’ve been the beneficiaries over the last two years of fairly consistent lower and lower, quarter over quarter, deposit cost and deposit pricing as the Fed has continuously lowered rates since mid-2024.
As we look forward through 2026, it’s interesting that deposit pricing from even the largest banks in the country no longer reflects them lowering rates for six-month, nine-month, 12-month (certificates of deposit savings accounts) in lockstep with the Federal Reserve (federal funds rate). This tells us that even some of the largest banks in the country are already seeing evidence of deposit pricing pressure and pushing on deposit pricing as a lever to maintain their funding over time.
East West comes at this from a different angle. We have the liquidity in our investment portfolio, and we have the strength of a customer profile, so we’re pretty confident we don’t need to stretch for deposits today, but we see evidence that the biggest banks are out there competing for deposits on pricing terms. That tells us the market is going to be more competitive, and that will be a pressure point. An additional pressure point is if the Fed actually reverses course and takes rates higher. I think that would have some steeper challenges for a number of banks. And while we’re prepared better than others, because we have more capital and more liquidity, it would still be a flash or pressure point for us.
