NEW YORK (
East West Bancorp
said Wednesday it's repaid $306.5 million of preferred stock issued to the U.S. Treasury, completing its exit from the TARP Capital Purchase Program.
The Pasadena, Calif.-based bank holding company said it used available cash to clear its bailout tab, and make a final $1.8 million dividend payment. The company expects the transaction to reduce fourth-quarter earnings by 14 cents a share, reflecting accounting for the discount the preferred stock was issued at as well as the final dividend payment.
East West said the TARP repayment eliminates preferred dividend payments of $15.3 million, or 10 cents a share, on an annual basis, and that it plans to repurchase a warrants to buy 1.5 million of its common shares from the Treasury in the first quarter.
On a pro forma basis reflecting the TARP repayment, the bank said its Tier 1 leverage capital ratio was 9.2%, its Tier 1 risk-based capital ratio was 15.3%, and its total risk-based capital ratio was 17.1% as of Sept. 30.
The stock closed Wednesday's regular session at $19.57, down 0.9%, and it ticked up 2.2% to $20 on volume of around 34,000, according to
. Year-to-date, the shares have appreciated 25%.
Written by Michael Baron in New York.
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