East West Bancorp Inc (EWBC) 2004 Q4 法說會逐字稿

Good morning. My name is Michelle, and I will be your conference facilitator. At this time, I would like to welcome everyone to the East West Bankcorp fourth-quarter earnings conference call. (OPERATOR INSTRUCTIONS). Mr. Canup, you may begin your conference.

早安.我叫米歇爾，我將擔任本次會議的主持人。現在，我謹代表華美銀行歡迎各位參加第四季業績電話會議。 （操作說明）卡納普先生，您可以開始您的會議了。

Good morning, everyone, and thank you for joining us to discuss East West's financial results for the third quarter and full year of 2004. In a moment Dominic Ng, our Chairman, President and Chief Executive Officer, will provide highlights for the quarter. Then Julia Gouw, our Executive Vice President and Chief Financial Officer, will review the financial details. We will then open the call to questions.

各位早安，感謝各位參加本次會議，共同探討東西方集團2004年第三季及全年的財務表現。稍後，我們的董事長、總裁兼執行長 Dominic Ng 將介紹本季的亮點。然後，我們的執行副總裁兼財務長朱莉婭·高將審查財務細節。接下來我們將開放提問環節。

First, I would like to caution participants that during the course of the conference call today management may make projections or other forward-looking statements regarding the events or future financial performance of the Company within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. We wish to caution you that these forward-looking statements may differ materially from actual results due to a number of risks and uncertainties. For a more detailed description of factors that affect the Company's operating results, we refer you to our filings with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended December 31, 2003.

首先，我想提醒各位參與者，在今天的電話會議期間，管理層可能會根據 1995 年《私人證券訴訟改革法案》的安全港條款，對公司的事件或未來財務業績做出預測或其他前瞻性陳述。我們謹此提醒您，由於許多風險和不確定因素，這些前瞻性陳述可能與實際結果有重大差異。有關影響公司經營績效的因素的更詳細說明，請參閱我們向美國證券交易委員會提交的文件，包括截至 2003 年 12 月 31 日止年度的 10-K 表格年度報告。

Today's call is also being recorded and will be available in replay format at eastwestbank.com and streetevents.com. I will now turn the call over to Dominic.

今天的電話會議也將被錄音，並將在 eastwestbank.com 和 streetevents.com 上以回放形式提供。現在我將把電話交給多明尼克。

Thank you, Steven. Good morning and thank you for joining today's call. We were pleased to announce our eighth year of record earnings this morning, as well as fourth quarter net income that was the highest for any quarter in the bank's history.

謝謝你，史蒂文。早安，感謝各位參加今天的電話會議。今天上午，我們很高興地宣布，我們連續第八年創下獲利紀錄，同時第四季淨收入也創下該行歷史上任何季度的最高紀錄。

For the full-year 2004, we reported net income of 78 million or net earnings per share of $1.49. For the quarter, net income totaled 22.6 million or 38 percent above a year ago. Our earnings per share totaled 42 cents, 27 percent higher than the fourth quarter of 2003.

2004 年全年，我們報告淨收入為 7,800 萬美元，即每股淨收益 1.49 美元。本季淨收入總計2,260萬，較去年同期成長38%。我們的每股盈餘總計 42 美分，比 2003 年第四季成長了 27%。

Excluding the gain on sales of our corporate office, earnings per share for the quarter totaled 40 cents. Julia will provide a brief summary of the financial details of the quarter shortly, but I would first like to comment on the main contributors to our financial performance for 2004 and give you our initial outlook for 2005.

若不計入公司總部出售收益，本季每股收益總計 40 美分。Julia 稍後將簡要概述本季度的財務詳情，但我首先想評論一下 2004 年我們財務業績的主要貢獻者，並向大家介紹我們對 2005 年的初步展望。

During the year, we took a number of important strategic actions, including the addition of experienced lending officers and corporate executives as part of our commitment to further expand market penetration in both our commercial and retail markets. We realize that the benefits of these investments in the record level of assets, loans and deposits with all of our operations making contributions to this performance.

今年，我們採取了一系列重要的策略行動，包括增加經驗豐富的信貸員和企業主管，以進一步擴大我們在商業和零售市場的滲透率。我們意識到，這些投資帶來的好處體現在資產、貸款和存款均達到歷史新高，我們所有的業務都為此業績做出了貢獻。

Our new hires played a key role in our market expansion during the year. We added a significant number of seasoned lending officers throughout our commercial operations, including several that specialized in generating commercial deposits. The new clients brought to East West by these new officers are the natural fit into our customer profiles, and we look forward to building lasting relationships with them.

今年，新進員工在我們拓展市場的過程中發揮了關鍵作用。我們在商業營運中增加了大量經驗豐富的信貸員，其中包括幾位專門負責商業存款的信貸員。這些新員工為東西方帶來新客戶，與我們的客戶群非常契合，我們期待與他們建立長期的合作關係。

In the third quarter, through our acquisition of Trust Bank, we also added four branches and many of these employees. This allowed us to expand on the products and service offers to the customer base of Trust Bank and enhance our geographic coverage of our core ethnic Chinese American market.

第三季度，透過收購 Trust Bank，我們也新增了四家分行和許多員工。這使我們能夠擴大對 Trust Bank 客戶群的產品和服務範圍，並擴大我們核心華裔美國人市場的地理覆蓋範圍。

Finally, our assisting employees and branches all made strong contributions to the year's performance, both adding new clients as well as capturing additional business from existing clients. The end result of these actions not only generated the record performance for the year, but also positioned us for another record year in 2005.

最後，我們的輔助員工和分公司都為今年的業績做出了巨大貢獻，既增加了新客戶，也從現有客戶那裡獲得了更多業務。這些舉措的最終結果不僅使公司在當年取得了創紀錄的業績，而且還為我們在 2005 年再創佳績奠定了基礎。

Strong growth in both loans and deposits highlight our performance for both the fourth quarter and the full year. Net organic loan growth for the year equaled 52 percent or 1.7 billion. Our ability to grow the portfolio at these rates is largely attributable to the depth of the market in California. Based on reporting from a leading title insurance company in the state, East West Bank was the third-largest originator of commercial real estate and multi-family loans in Los Angeles County through the third quarter of 2004.

貸款和存款的強勁成長凸顯了我們第四季和全年的業績。本年度淨有機貸款成長52%，即17億。我們能夠以這樣的速度成長投資組合，很大程度上要歸功於加州市場的深度。根據該州一家領先的產權保險公司的報告，截至 2004 年第三季度，華美銀行是洛杉磯縣商業房地產和多戶住宅貸款的第三大發起機構。

While this ranking is noteworthy, our total market share for the same period was just over 3 percent. Given the vast potential to increase market share in California, we believe that as long as we continue to provide responsive value-added solutions to our client base we can achieve our goals for loan growth into the foreseeable future.

雖然這項排名值得關注，但我們同期市佔率總和僅略高於 3%。鑑於加州市佔率成長的巨大潛力，我們相信，只要我們繼續為客戶群提供響應迅速、增值的解決方案，我們就能在可預見的未來實現貸款成長的目標。

We were also very pleased with deposit growth for the year, organic deposit growth equal to 1 billion or 31 percent to 2004. Average core deposits for the year increased by over 400 million or by 25 percent. We have always focused on growing low-cost stable deposits in order to increase our net interest margin and net income.

我們對本年度的存款成長也感到非常滿意，有機存款成長達到 10 億，比 2004 年成長了 31%。該年度平均核心礦藏量增加了 4 億多百萬，增幅達 25%。我們一直專注於發展低成本的穩定存款，以提高淨利差和淨收入。

As previously discussed, core deposit growth will be a major focus for us in 2005. We believe that with the value and service level that we can provide to a wide range of small to medium-sized commercial customers, as well as our core ethnic retail customers, we will be able to grow our demand and other core deposit categories even in an increasingly competitive deposit market.

如同先前討論過的，核心礦床的成長將是我們2005年的主要關注點。我們相信，憑藉我們能夠為眾多中小商業客戶以及我們的核心少數族裔零售客戶提供的價值和服務水平，即使在競爭日益激烈的存款市場中，我們也能夠增長需求和其他核心存款類別。

During the fourth quarter of 2004, we generated a net interest margin of 4.34 percent compared to 4.24 percent for the third quarter of 2004. We continue to experience moderate gains in our margins for both higher market interest rates and our ability to hold deposit costs down.

2004 年第四季，我們的淨利差為 4.34%，而 2004 年第三季為 4.24%。由於市場利率上升以及我們能夠將存款成本控制在較低水平，我們的利潤率持續穩定成長。

Looking to our guidance for 2005, we have set an initial earnings per share estimate of between $1.76 and $1.78, an increase of approximately 20 percent from 2004. This guidance is based on the following assumptions -- loan growth for the year of 18 to 20 percent; deposit growth for the year of 15 to 17 percent; an increasing total non-interest expense in 2005 of 19 to 23 percent, resulting in an efficiency ratio of between 36 and 38 percent; an effective tax rate of between 38 and 39 percent, and a stable interest rate environment resulting in net interest margin of 4.35 to 4.4 percent.

展望 2005 年，我們初步預測每股收益在 1.76 美元至 1.78 美元之間，比 2004 年增長約 20%。該指導意見基於以下假設——當年貸款增長率為 18% 至 20%；當年存款增長率為 15% 至 17%；2005 年非利息支出總額增長 19% 至 23%，導致效率比率在 36% 至 38% 之間；有效稅率在 38% 至 39% 至 39% 之間。

I will now turn the call over to Julia.

現在我將把通話轉給茱莉亞。

Thank you, Dominic. This morning's release contained a detailed discussion of the financial results for the quarter, so I will focus on a few key items, including our loan portfolio.

謝謝你，多米尼克。今天早上發布的報告詳細討論了本季度的財務業績，因此我將重點關注幾個關鍵項目，包括我們的貸款組合。

Our net interest margins for the quarter equaled 4.34 percent, equal to the margin a year ago and up 10 basis points from last quarter. Compared to the third quarter of 2004, the yield on earnings assets increased by 26 basis points to 5.63 percent, while the cost of funds increased by 16 basis points to 1.35 percent. About 54 percent of our loan portfolio repriced immediately -- 14 percent repriced under one year, and 21 percent repriced between three and five years. We maintain a slight asset sensitivity and believe that with the growth in our loan portfolio and our core deposit base we can achieve a margin in 2005 between 4.35 and 4.40 percent, assuming no further increasing in Fed funds.

本季淨利差為 4.34%，與去年同期持平，較上一季成長 10 個基點。與 2004 年第三季相比，收益資產收益率上升了 26 個基點，達到 5.63%，而資金成本上升了 16 個基點，達到 1.35%。我們約 54% 的貸款組合立即重新定價——14% 的貸款在一年內重新定價，21% 的貸款在三到五年內重新定價。我們保持輕微的資產敏感性，並相信隨著貸款組合和核心存款基礎的增長，假設聯邦基金利率不再增加，我們可以在 2005 年實現 4.35% 至 4.40% 的利潤率。

Core non-interest income for the quarter decreased 2.3 million, primarily due to the shift in the demand from fixed-rate mortgages, which we saw into the secondary market, to variable loans which we retain in our portfolio.

本季核心非利息收入減少了 230 萬，主要是由於需求從固定利率抵押貸款（我們看到這些貸款進入了二級市場）轉向了我們保留在投資組合中的浮動利率貸款。

Asset quality. We are very pleased that our credit quality remains very excellent. Nonperforming assets equaled 5.2 million or 9 basis points of total assets. 11 total loans are on nonperforming status, including three single-family loans. The majority of the balance of the nonperforming assets are represented by three trade finance loans and two C&I loans.

資產品質。我們非常高興我們的信用品質依然非常優秀。不良資產為520萬美元，佔總資產的9個基點。共有11筆貸款處於不良狀態，其中包括3筆單戶住宅貸款。不良資產餘額的大部分由三筆貿易融資貸款和兩筆工商貸款構成。

Non-accrual loans totaled 4.9 million or 10 basis points of total loans. Net charge-off for the quarter equaled 837,000 or an annualized 7 basis points of average loans. For the year, net charge-offs equaled 12 basis points of average loans. We continue to anticipate a nonperforming asset level at or below 50 basis points and total charge-offs at or below 35 basis points.

非應計貸款總額為 490 萬，佔貸款總額的 10 個基點。本季淨沖銷額為 837,000，相當於年化平均貸款額的 7 個基點。該年度淨沖銷額相當於平均貸款額的 12 個基點。我們繼續預期不良資產水準將維持在 50 個基點或以下，總核銷額將維持在 35 個基點或以下。

Our loan portfolios remain well diversified and secured. Portfolio characteristics include commercial real estate loans as of December 31st had an average balance of 1.2 million, average loan to value of 57.3 percent, and average seasoning of 1.7 years. Multi-family loans had an average balance of 500,000, an average loan to value of 61.2 percent, and seasoning of 1.7 years. Construction loans had an average balance of 1.6 million, loan to value of 64.2 percent, and seasoning of one year. Finally, single-family loans have an average balance of 312,000, loan to value of 58.9 percent, and seasoning of 1.4 years.

我們的貸款組合保持了良好的多元化和安全性。截至 12 月 31 日，投資組合的特點包括商業房地產貸款的平均餘額為 120 萬，平均貸款價值比為 57.3%，平均帳齡為 1.7 年。多戶住宅貸款的平均餘額為 500,000，平均貸款價值比為 61.2%，貸款期限為 1.7 年。建築貸款的平均餘額為 160 萬，貸款價值比為 64.2%，期限為一年。最後，單戶住宅貸款的平均餘額為 312,000，貸款價值比為 58.9%，貸款期限為 1.4 年。

In addition to the average loan to value ratio for each category, I would like to provide an overview of the range of the loan to value ratio for a few of our loan categories. For commercial real estate loans, the distribution of the loan to values are as follows. Less than 50 percent of loan to value, 22 percent of the portfolio. Between 50 to 60 percent loan to value, 30 percent of the portfolio. Between 60 to 70 percent loan to value, 40 percent of the portfolio. And over 70 percent loan to value, only 6.5 percent of our commercial real estate portfolio. For multi-family loans, 12 percent of the portfolio have a loan to value less than 50 percent. 19 percent of the portfolio have loan to value between 50 to 60 percent. 48 percent of the portfolio have loan to value between 60 to 70 percent, and 21 percent of the portfolio have loan to value between 70 to 80 percent.

除了各類別平均貸款成數之外，我還想概述我們部分貸款類別的貸款價值比範圍。對於商業房地產貸款，貸款與價值的分配如下。貸款成數低於 50%，佔投資組合的 22%。貸款成數在 50% 到 60% 之間，佔投資組合的 30%。貸款成數在 60% 到 70% 之間，佔投資組合的 40%。超過 70% 的貸款價值比，僅占我們商業房地產投資組合的 6.5%。在多戶住宅貸款中，12%的貸款組合的貸款價值比低於50%，19%的貸款組合的貸款價值比在50%至60%之間，48%的貸款組合的貸款價值比在60%至70%之間，21%的貸款組合的貸款價值比在70%至80%之間。

I will now turn the call over to Dominic.

現在我將把電話交給多明尼克。

Thank you, Julia. Again, thank you for joining today's call. We appreciate your continued support and interest, and we are very pleased to generate another year of record earnings for our shareholders. We believe that we are well positioned to continue to capture market opportunities and make 2005 our ninth consecutive year of record earnings.

謝謝你，茱莉亞。再次感謝您參加今天的電話會議。感謝您一直以來的支持與關注，我們非常高興能夠為股東們再創佳績，實現又一個創紀錄的獲利。我們相信，我們已做好充分準備，繼續抓住市場機遇，使 2005 年成為我們連續第九年創下獲利紀錄。

I will now open the call to questions.

現在開始接受提問。

(OPERATOR INSTRUCTIONS). Lana Chan, Advest.

（操作說明）Lana Chan，廣告。

Good morning. My first question is, if you could update us on your asset sensitivity for every 25 basis point increase in the prime of Fed funds rate, what happens to the margin?

早安.我的第一個問題是，如果聯準會最優惠基金利率每上升 25 個基點，您的資產對利差的敏感度會發生什麼變化，請您更新資料。

Our estimate is for every 25 basis point increase in the Fed funds rate it will translate to about 5 basis point interest in our net interest margin, and that translates about 3 cents of earnings per share.

我們估計，聯邦基金利率每上升 25 個基點，我們的淨利差就會增加約 5 個基點，相當於每股盈餘增加約 3 美分。

Okay. That is a little bit lower than before. Does that have anything to do with the declining yield curve?

好的。比之前略低一些。這跟殖利率曲線下降有關係嗎？

Well, you know as the rates go higher and higher, the incremental increase would be reduced. In addition, we are also positive that the deposit rates have been very competitive.

你知道，隨著利率越來越高，增量就會減少。此外，我們也確信存款利率非常有競爭力。

Okay. In terms of the deposit campaign that you alluded to in the press release on the small middle market side, could you be more specific about what you're doing there?

好的。關於您在新聞稿中提到的針對中小市場的存款活動，您能否更具體地說明您正在採取哪些措施？

We have a promotion brought to (inaudible) system together, especially the small to middle market demand deposit accounts. So we have attractive product and some gift items for customers and also incentives for the staff to bring these types of deposits.

我們正在向（聽不清楚）系統推出促銷活動，特別是針對中小市場活期存款帳戶。因此，我們有吸引人的產品和一些禮品贈送給顧客，同時也有獎勵措施鼓勵員工帶來這類存款。

Okay. And my next question is related to the expense guidance for 2005. It seems like that was higher than what you had previously guided to, the 19 to 23 percent. Could you talk about what is going into that higher expense growth rate?

好的。我的下一個問題與 2005 年的費用指引有關。看來這個數字比你之前預測的 19% 到 23% 還要高。能談談導致成本成長率上升的原因嗎？

Well, with the high growth that we are experiencing, you know we have to add more staff, so a lot of the increase is in the compensation, and some other expenses that would contribute. Occupancy expense will increase, other expenses, marketing, you know some deposit expenses will continue to increase. So we do project that for 2005 our expenses will increase 19 to 23 percent compared to this year through 2004.

嗯，由於我們正經歷高速成長，你知道我們必須增加員工，所以成長的大部分體現在薪酬和其他一些開支。租金支出將會增加，其他支出、行銷費用，以及一些押金支出也會持續增加。因此，我們預計 2005 年的支出將比 2004 年到今年增加 19% 至 23%。

Does it include any additional hires of lenders and/or expansion with the 99 branch stores?

是否包括額外招募貸款人員和/或擴建99家分店？

Yes, we do include the projection of opening two install branches this year and additional hiring as we continue to grow.

是的，我們預計今年將開設兩家安裝分公司，並隨著業務的持續成長而增加招募。

Okay. Thank you.

好的。謝謝。

Andrea Jao, Lehman Brothers.

Andrea Jao，雷曼兄弟公司。

Given organic loan growth in excess of 50 percent in 2004, could you talk about the dynamics you're seeing into 2005 that encourages you to pull back your projected loan growth to the 20 percent area? And why such a dramatic pullback?

鑑於 2004 年有機貸款成長率超過 50%，您能否談談您認為 2005 年有哪些因素促使您將預期貸款成長率下調至 20% 左右？為什麼會出現如此劇烈的回調？

I would not call it a pullback. I think that what we look at in 2004 versus 2005 is that the loan growth has a combination of both low origination and also payoff, and we have experienced a very good year in 2004 in terms of payoffs. Frankly, if we look at 2001, 2002, 2003, we always have very high loan origination, but due to the refinance market, a lot of customers who were back in 2002, 2003 were just refinancing their mortgages and so forth, which caused also very high payoff.

我不會稱之為回調。我認為，我們比較 2004 年和 2005 年的情況來看，貸款成長既包括較低的貸款發放量，也包括較低的貸款償還量，而 2004 年我們在貸款償還方面取得了非常好的成績。坦白說，如果我們回顧 2001 年、2002 年、2003 年，貸款發放量一直很高，但由於再融資市場，很多在 2002 年、2003 年的客戶只是在進行抵押貸款再融資等等，這也導致了非常高的還款額。

Now in 2004 that had changed quite dramatically and which resulted in our net loan growth to be dramatically higher. In addition to obviously we hired a substantial more new lending officers. We're planning to continue to hire more lending officers; however, we at this stage right now do not anticipate the same kind of magnitude of hiring like what we did in 2004.

到了 2004 年，情況發生了相當大的變化，導致我們的淨貸款成長率大幅提高。除了這些，我們還聘請了更多新的信貸員。我們計劃繼續招募更多信貸員；但是，就目前而言，我們預期招募規模不會像 2004 年那麼大。

I mean that -- so it is a combination of both the expectation of maybe payoff will go back up a little bit higher to the normal rate rather than what happened in 2004. That is one. Secondly is that if we're not going to be hiring as many people as well we did in 2004, we would also expect that that may not have as substantial of a growth. Because keep in mind that once we grow to our size today, because of the magnitude of the growth, the base, the initial base is much higher. So that 20 percent growth from a $5 billion portfolio is still a billion. So it is not a small number. It is much harder than a growth of from $3 billion portfolio. So I think it's a combination of all these reasons, and we are being cautious and want to make sure that we do not sort of like have overly optimistic kind of view.

我的意思是——所以這是兩種預期的結合，即收益可能會回升到正常水平，而不是像 2004 年那樣。這是其中之一。其次，如果我們不能像 2004 年那樣招募那麼多人，我們也預期成長幅度可能不會那麼大。因為請記住，當我們長到今天的體型時，由於增長的幅度，基數，也就是初始基數，要高得多。所以，即使50億美元的投資組合成長20%，還是10億美元。所以這並非一個小數字。這比從30億美元的投資組合中成長要難得多。所以我認為這是所有這些原因的綜合作用，我們保持謹慎，希望確保我們不會抱持過於樂觀的看法。

Secondly is that I want to point out that if opportunity arises, that we continue to attract great talent and commercial bankers in the market, we are not going to hesitate to hire them. It is just that right at the beginning of the year for us to make an assumption that we're going to be able to hire a lot of people to generate a substantial growth like we did last year, I think at this point it would be somewhat premature.

其次，我想指出，如果機會出現，我們繼續在市場上吸引優秀人才和商業銀行家，我們將毫不猶豫地聘用他們。只是在年初就假設我們能夠像去年一樣招募很多人以實現大幅成長，我認為現在這樣做還為時過早。

Understood. Fair enough. Would you also care to comment on how competitive it is in terms of the credit markets in terms of granting loans? You already mentioned earlier that deposit taking is becoming more competitive. How about the loan side?

明白了。很公平。您能否也談談信貸市場在貸款發放的競爭情況？您之前已經提到過，存款業務的競爭越來越激烈。貸款方面情況如何？

It has always been competitive. In fact, I don't anticipate it would slow down. In fact, I would expect that the intensity is even going to go further. I think one of the advantages that we have is that while the market has been extremely competitive, as far as East West is concerned, we I think had worked very hard several years ago to really aggressively build our name recognition beyond just the Chinese market, and we have yet better and better recognition in the mainstream market for the last few years. I think that if you look at 2004, it is not just as I said earlier, beyond just the fact that we have a substantial number of new hires that came in and helped the production, our existing staff has done a tremendous job in terms of growing the loan portfolio. That has to do with the last several years of active marketing in the mainstream market that is now paying off.

競爭一直都很激烈。事實上，我預計它不會放緩。事實上，我預期這種強度還會進一步增強。我認為我們的優勢之一是，雖然市場競爭非常激烈，但就東西方而言，我認為我們幾年前就付出了巨大的努力，積極地將我們的品牌知名度擴展到中國市場之外，而且在過去的幾年裡，我們在主流市場的知名度也越來越高。我認為，如果你回顧 2004 年，你會發現，正如我之前所說，除了我們大量新員工的加入和對生產的幫助之外，我們現有的員工在擴大貸款組合方面也做出了巨大的貢獻。這與過去幾年在主流市場積極進行行銷活動，如今終於有成效有關。

Campbell Chaney, Sanders Morris Harris.

坎貝爾·錢尼，桑德斯·莫里斯·哈里斯。

I've got some reconciliation on your asset sensitivity. I think Julia said for every 25 basis point move in the Fed funds rate that is 5 basis points to the margin or 3 cents a share. How many Fed funds rate increases is that guidance good for? Because your guidance for the year is more or less a flat to up 5 basis point margin?

我有一些關於您資產敏感性的核對結果。我認為茱莉亞說過，聯邦基金利率每變動 25 個基點，利差就會變動 5 個基點，也就是每股 3 美分。這樣的指導意見適用於多少次聯準會升息？因為你們今年的業績指引大致是持平或略微上調5個基點？

That 5 basis point is for up to 100 basis point breakeven. So we are projecting for up to 100 basis point, it would be about 20 basis point increase in net interest margin.

這 5 個基點適用於損益平衡點最高為 100 個基點的情況。因此，我們預計利率將上漲至多 100 個基點，這將使淨利差增加約 20 個基點。

Okay, so still 100 basis points up?

好的，所以還是會上漲100個基點？

That is correct.

沒錯。

And then I noticed in the quarter your borrowings you increased home loan bank advances to fund the loan growth, which I certainly understand. What are the terms of those home loan bank advances, and how quickly can you replace those if your deposit programs get more traction than you think?

然後我注意到，本季你們增加了房屋貸款銀行的貸款，以資助貸款成長，這我當然可以理解。這些房屋貸款銀行預付款的條款是什麼？如果您的存款計劃比您預想的更受歡迎，您能多快彌補這些預付款？

Now, most of them are variable, are very short overnight federal home loan bank advances. So we can always pay down at any time the majority of the additional increases. We locked in the longer-term fixed-rate of advances in the early part of the year.

現在，它們大多是浮動利率，是聯邦住房貸款銀行提供的非常短的隔夜預付款。因此，我們可以隨時償還大部分新增款項。今年年初，我們鎖定了長期固定貸款利率。

Okay. So all the increase in the Q4 was just overnight funds?

好的。所以第四季的所有成長都只是隔夜資金流入？

That is correct.

沒錯。

One last question about expenses. Can you give us some color if there were any kind of special fourth-quarter item type expenses there that may not be repeated in the first quarter?

關於費用方面，最後一個問題。能否詳細說明一下，第四季是否存在一些特殊的、可能不會在第一季重複出現的項目支出？

(multiple speakers)

（多位發言者）

-- for advertising or things like that.

——用於廣告或其他類似用途。

Actually the total expenses for the first quarter will be slightly higher than the fourth quarter. I don't expect the total expenses to go down because in the compensation we did increase the bonus accrual in the fourth quarter by about 350,000. However, going forward, we do have to increase our bonus accrual based upon the higher salary base as an expense. And although we do have some additional marketing expenses and Sarbanes-Oxley compliance fees that we paid, other expenses will go up to offset those. So I do not expect first quarter of 2005 that total expense would be below the fourth quarter of 2004.

實際上，第一季的總支出將略高於第四季。我不認為總支出會下降，因為在薪資方面，我們在第四季將獎金提列增加了約 35 萬。但是，展望未來，由於薪資基數提高，我們必須增加獎金計提，這筆費用將增加到薪資基數更高的水平。雖然我們支付了一些額外的行銷費用和薩班斯-奧克斯利法案合規費用，但其他費用將會增加以抵消這些費用。因此，我不認為 2005 年第一季的總支出會低於 2004 年第四季。

Kathy Steinbrecher, Piper Jaffray.

凱西·斯坦布雷徹，派珀·賈弗雷。

Good quarter. Just a couple of more questions on the deposit side. What is your compensation structure for paying these officers that are focused on the deposit side, and how is that going to affect the compensation cost going forward? Should we expect it to be about the same as what it is now, or will there be more variable expenses associated with these, generating these higher deposits?

本季表現不錯。關於存款方面，還有幾個問題。貴公司針對專注於存款業務的這些管理階層制定了怎樣的薪酬結構？這將如何影響未來的薪資成本？我們應該預期它會和現在差不多，還是會有更多相關的變動費用，從而導致更高的存款？

Well, in general we pay our officers with a salary plus a year-end bonus. Once in a while we do these internal competition like with we set aside a certain dollar amount of funds, and then whoever -- I mean the winner or the second prize or third prize or fourth prize, and we do have a few of those kind of incentive programs going. But we do not currently have a companywide sort of commission programs for the -- as an incentive for employees to bring deposits in and so forth. So it is all pretty much an annual salary and then a year-end bonus is what we currently have.

一般來說，我們給員工的薪酬包括基本工資和年終獎金。我們偶爾會舉辦一些內部競賽，例如撥出一定金額的資金，然後無論誰獲得第一名、第二名、第三名或第四名，我們都會進行一些這樣的激勵計劃。但我們目前還沒有公司範圍內的佣金計劃，作為激勵員工帶來存款等的手段。所以目前我們的薪資制度基本上就是年薪加年終獎金。

So as you hire these possibly additional deposit gatherers, that portion of compensation, you expect that to be about what it is, or do you expect that to continue to grow?

所以，當你僱用這些可能額外的存款收取人員時，你預期這部分報酬會保持不變，還是會繼續成長？

Well, when we bring in the additional people, obviously I mean the total compensation cost will continue to rise based on the number of hires that we have, and in fact our projection of 19 to 23 percent of expense growth in 2005 are mainly attributed to the fact that we are planning to hire possibly some additional people.

嗯，當我們增加人手時，很明顯，我的意思是總薪酬成本會根據我們招聘的人數繼續上升，事實上，我們預計 2005 年支出增長 19% 到 23%，這主要是因為我們計劃可能再招聘一些員工。

Okay and then just another question on the deposits. As interest rates go up and deposits become more difficult, I would imagine that the cost of those deposits is going to rise. What is your strategy on that as far as minimizing those costs, or you're planning to be more of a price leader?

好的，關於存款方面還有一個問題。隨著利率上升，存款變得越來越困難，我認為存款成本也會上升。您在降低成本方面有什麼策略？或者您打算成為價格領導者？

No, I think in terms of -- our philosophy at the bank has always been we are trying to attract the low stabilized core deposits. I mean when I say low interest rates stabilized -- I mean stable cost of core deposits.

不，我認為就我們銀行的理念而言——我們一直致力於吸引低利率的穩定核心存款。我的意思是，當我說低利率趨於穩定時——我的意思是核心存款成本趨於穩定。

And in terms of our strategy, it has always been focus first and foremost on the small to medium-sized commercial business, checking accounts, and then obviously together with that, sometimes there are money market accounts that we do have to pay competitive interest rates. But when we have money market accounts that we pay competitive interest rates coupled with a DDA account that we don't pay interest rate, averaged out we get a lower-cost of deposit versus the other peer banks.

就我們的策略而言，我們始終將重點放在中小型商業企業的支票帳戶上，當然，除此之外，有時我們也會提供貨幣市場帳戶，並支付有競爭力的利率。但是，當我們擁有支付有競爭力的利率的貨幣市場帳戶，以及不支付利率的活期存款帳戶時，平均下來，我們的存款成本比其他同類銀行要低。

On the other hand, in our retail banking side, we continue to stay aggressive in terms of attracting low-cost core deposits from the retail market. That is also the reason why in 2005 in the first quarter we plan to open two more in-store branches to help us to continue to drive our growth in the retail segment.

另一方面，在零售銀行業務方面，我們持續保持積極進取的態度，努力從零售市場吸引低成本的核心存款。這也是為什麼我們計劃在 2005 年第一季再開設兩家店內分店，以幫助我們繼續推動零售業務的成長。

Okay. And then also on your tax rate, I know you mentioned in your release that you expect that to go up this year. Any thoughts maybe towards the end of the year as far as trying to mitigate that tax rate?

好的。另外，關於稅率，我知道您在新聞稿中提到預計今年的稅率會上升。在年底之前，大家有沒有辦法降低稅率？

Well, the tax rate is driven on the lower of the tax rate, primarily from the investment in low income housing. That really depends. If we can find attractive investment, we may purchase some to reduce the tax rate. However, the yield is not as attractive as it used to be.

稅率主要取決於較低的稅率，這主要源於對低收入住房的投資。那真的要看情況。如果能找到有吸引力的投資項目，我們可能會購買一些來降低稅率。然而，目前的收益率已不如以往理想了。

Okay. And then just on the selling of the two corporate offices, was that from the Trust Bank?

好的。那麼，關於出售這兩棟公司辦公大樓的事情，是信託銀行做的嗎？

No, this is the East West Bank offices. Yes.

不，這裡是華美銀行的辦公地點。是的。

Joe Morford, RBC Capital Markets.

Joe Morford，加拿大皇家銀行資本市場。

I guess a couple of questions. First was a follow-up to Andrea's question on the loan growth. If you look at the -- in the fourth quarter, sequential growth was 8.7 percent, and you are guiding toward 18 to 20 percent. So the assumption would be that throughout the year kind of the growth rate is decelerating. Where do you see that kind of settling into as kind of a more sustainable normalized growth rate that we would be running at later in '05?

我想問幾個問題。首先是對 Andrea 關於貸款成長問題的後續問題。如果你看一下——第四季度，環比成長率為 8.7%，而你們預計成長率將達到 18% 至 20%。因此，可以假設全年成長率呈下降趨勢。您認為到 2005 年下半年，我們會達到怎樣的更可持續的正常成長率？

In the long run, we always believe that 15 percent loan growth is sustainable in the long period of time. We were just so fortunate that last year the loan growth was so extraordinary. But I think that you know in the next couple of years it probably settles down to 15 percent.

從長遠來看，我們始終認為15%的貸款成長率在長期內是可持續的。我們真是太幸運了，去年的貸款成長非常驚人。但我認為，在接下來的幾年裡，這個數字可能會穩定在 15%。

And in '05, do you see more opportunity on the construction side, as well that could be a bigger growth area?

那麼，在 2005 年，您是否認為建築業方面會有更多機會，這可能是更大的成長領域？

As of now it is. I guess our position is that we wanted to be very cautious about the market conditions. The last two or three years has been just an extraordinary market. Actually if you look at Southern California, it has been pretty extraordinary for the last several years.

目前來看確實如此。我想我們的立場是，我們希望對市場狀況保持非常謹慎的態度。過去兩三年市場行情非比尋常。事實上，如果你看看南加州，你會發現它近幾年來的發展相當出色。

How long will that last? We don't know. So to take a very cautious kind of approach, we need to be somewhat conservative in our expectation in the future. However, there is going to be a likelihood that the Southern California real estate market just never dies. I think that in about four months to six months we will know better, and at that point, we will have to make sure that we look at our guidance and see whether that is still appropriate.

這種情況會持續多久？我們不知道。因此，為了採取非常謹慎的態度，我們需要對未來抱持一定的保守預期。然而，南加州房地產市場很可能永遠不會消亡。我認為大約四到六個月後，我們會更清楚情況，到那時，我們將不得不重新審視我們的指導方針，看看它是否仍然適用。

Okay. And then I guess the other question would be just trying to get a little better understanding of why such a high-growth rate and expenses in the fourth quarter -- it did not seem like there was per se a surge in hiring. If anything, it was more spread out throughout the year. Some of the bigger hires were earlier in the year. You talked about maybe some outside stuff for regulatory costs. But I don't know, maybe you could comment a little bit more about why such a high-growth rate in the fourth quarter.

好的。那麼，我想問的另一個問題是，為什麼第四季成長率和支出如此之高——看起來並沒有出現招募激增的情況。如果有什麼不同的話，那就是它更加分散在全年的各個時段。一些較大的招募是在年初進行的。你提到可能還有一些外部監管成本。但我不知道，或許您可以再多解釋為什麼第四季的成長率如此之高。

Actually the hiring in the third quarter we do -- the second half we do have quite a few hirings also. And also the Trust Bank acquisition happened in August. So that is the impact in the fourth quarter. We have the highest level of the compensation, and then we have to increase our bonus accrual. That is right. If you are just comparing it to the third quarter, it becomes a pretty big chunk.

實際上，我們在第三季確實會招募——下半年我們也會招募不少人。此外，信託銀行的收購也發生在八月。這就是第四季的影響。我們擁有最高的薪資水平，因此我們必須提高獎金累積額度。沒錯。如果只與第三季相比，這確實是一大塊。

Yes, it is a quarter to quarter comparison. So the fourth quarter of 2003 you know obviously did not have all of those hirings that we have throughout the year of 2004. And Trust Bank, you know we got finally a full quarter of employees that came from another bank. Unlike the third quarter, we only get about half of it. So it is a combination of all the effects that create that kind of high percentage of growth quarter to quarter from 2003 to 2004.

是的，這是季度間的比較。所以，很顯然，2003 年第四季並沒有像 2004 年全年那樣進行那麼多招募。你知道，Trust Bank 終於招募了四分之一的員工，他們都是來自另一家銀行的。與第三季不同，我們只能得到大約一半的時間。因此，正是所有這些因素的綜合作用，才使得 2003 年至 2004 年的季度成長率如此之高。

Brett Rabatin, FTN Securities.

Brett Rabatin，FTN Securities。

I wanted to discuss -- we are talking about Southern California real estate and if the market could continue and what not. I'm curious to hear some thoughts on real estate and interest rates and what if the yield curve moves up a little bit -- let's say 100 basis points; it's obviously going to climb some -- but as interest rates move up, how much of an impact are you guys thinking about that having on real estate originations?

我想討論一下——我們現在談論的是南加州房地產市場，以及市場能否繼續發展等等。我很想聽聽大家對房地產和利率的看法，如果殖利率曲線稍微上升——比如說上升 100 個基點；顯然它會上升一些——但隨著利率上升，你們認為這會對房地產貸款發放產生多大的影響？

Well, I think it depends on how the rates are going up. When you talk about 100 basis point -- even with 100 basis point increase, let's say by the end of 2005, if you look at on a historical perspective, it is still a not very high rate. There are many people in Southern California who are making a lot of money in real estate at a much higher rate environment back then than what it is today.

嗯，我覺得這取決於利率上漲的趨勢。當你談到 100 個基點時——即使成長 100 個基點，比如說到 2005 年底，從歷史角度來看，這仍然不是一個很高的利率。在南加州，很多人透過房地產投資賺了很多錢，而當時的房地產市場利率遠高於現在。

So I still still feel that that should not be a big negative impact. I think that the negative impact would mostly come from the sentiment of all the psychology of the investors. And, for example, instead of like a 25 basis point, 25 basis point and a very systematic increase throughout the year, if we suddenly have a surge of 50 or 75 basis points and then immediately tact on another 25 and then be done with for a while, that type of situation obviously something must have spooked the Federal Reserve Bank to decide to do such an action. And if that is the case, I would think that the market will react very very differently.

所以我仍然認為這不應該造成很大的負面影響。我認為負面影響主要來自投資者的各種心理因素。例如，與其像往年那樣每年穩步加息 25 個基點，不如突然猛增 50 或 75 個基點，然後立即再加息 25 個基點，之後就暫停一段時間，這種情況顯然一定是美聯儲受到了某種驚嚇，才決定採取這樣的行動。如果真是那樣，我認為市場反應會完全不同。

So psychology in my mind is the most important factor versus just a pure academic discussion about 100 basis point growth. And in fact, not only are the effects to the real estate investment market per se in Southern California, when you see, let's say, a two in a row 50 basis point, 50 basis point increase in, let's say, within a two-month period of time, it will also completely change the dynamic of a lot of these banks in terms of their interest rate sensitivity. Because when that kind of change, even though at the end of the year is only 100 basis points, it is very different than a very smooth systematic increase you know that many people projected.

所以在我看來，心理因素才是最重要的，而不是只進行關於100個基點成長的純粹學術討論。事實上，如果利率在兩個月內連續上漲 50 個基點，不僅會對南加州的房地產投資市場本身產生影響，還會徹底改變許多銀行的利率敏感度。因為這種變化，即使到年底只有 100 個基點，也與許多人預測的非常平穩的系統性成長截然不同。

Let's just say I'm a commercial real estate investor, and I'm assuming you guys are doing 200 basis point shocks on your CRA portfolio or your originations. If rates moved up 200 basis points on a commercial real estate loan, you don't think that -- do you think that would be more -- the demand would not decrease from that as a result?

假設我是一名商業房地產投資者，我假設你們正在對你們的 CRA 投資組合或貸款發放進行 200 個基點的衝擊。如果商業房地產貸款利率上漲 200 個基點，你認為——或者說，如果利率上漲更多——需求不會因此而下降嗎？

When you say 200 basis points or 100 basis points?

你說的是200個基點還是100個基點？

Well, 200 -- I mean -- what are you (multiple speakers) -- on your shocks are you doing 100 or 200 basis point shocks?

嗯，200－我的意思是－你們（多位發言者）－你們的衝擊是100個基點還是200個基點？

In terms of our portfolio, we shocked at 200 basis points to make sure that it is still at that service. But that is the type of (inaudible). We wanted to make sure that our customers can get service.

就我們的投資組合而言，我們大幅調整了 200 個基點，以確保它仍然能提供該服務。但那是那種（聽不清楚）。我們希望確保我們的客戶能夠獲得服務。

Yes, that would be more on the credit -- credit risk concern. I mean I will say that we are very comfortable with our loan in terms of asset quality. In terms of asset quality, we are very comfortable that even with a 200 basis point increase our debt service is still adequate for our customers. However, when you talk about loan origination, the market sentiment, you know I would think that that would have to have a negative impact. Again, the negative impact would be very benign if we talk about a very very gradual slow increase. But if it is going to be a big jump, you know, off 100 basis point and then another big jump, it is going to have a very very negative impact to the market.

是的，那更多的是信用方面的問題──信用風險的擔憂。我的意思是，就資產品質而言，我們對這筆貸款非常有信心。就資產品質而言，我們非常有信心，即使利率上升 200 個基點，我們的償債能力仍然足以滿足客戶的需求。但是，說到貸款發放和市場情緒，我認為這肯定會產生負面影響。再說一遍，如果成長速度非常非常緩慢，那麼負面影響將非常輕微。但如果是大幅上漲，例如先上漲 100 個基點，然後再大幅上漲，將會對市場產生非常非常負面的影響。

Okay. And the other question I wanted to ask was, is going back to the sale of the corporate offices, what exactly were those and what is your growth? I guess I am a little confused. Are you moving branches or offices or what is going on?

好的。我想問的另一個問題是，回到出售公司辦公大樓這件事上，這些辦公大樓具體是什麼？你們的成長情況如何？我有點糊塗了。你們是要搬遷分公司還是辦公室？或有什麼其他情況？

We are moving. In fact, we have been in this headquarters in San Marino for over 20 years, and we have outgrown ourselves a long long time. For so for that reason, we have decided that we need to move on to get more space. And then so we have signed on a long-term lease that will give us a substantial more space in Pasadena. So we are basically -- just two buildings are the corporate head office.

我們要搬家了。事實上，我們在聖馬力諾的總部已經超過 20 年了，我們早就發展壯大，不再適合現在的規模了。因此，出於這個原因，我們決定搬遷以獲得更大的空間。因此，我們簽訂了一份長期租賃合同，這將使我們在帕薩迪納擁有更大的辦公空間。所以基本上，我們只有兩棟大樓作為公司總部。

Okay. So you are moving the headquarters to a new location?

好的。所以你們要把總部遷到新的地點？

We're not moving until the latter part of this year.

我們今年下半年才會搬家。

And you are moving to an existing facility?

你們是要搬到現有的辦公室嗎？

An existing building in Pasadena that would allow us -- you have more space, so that will allow us to consolidate some of the satellite offices that we have around here.

帕薩迪納現有的一棟建築將為我們提供更大的空間，這將使我們能夠整合我們在這裡的一些衛星辦公室。

Andrea Jao, Lehman Brothers.

Andrea Jao，雷曼兄弟公司。

Just a short follow-up housekeeping type question. In your guidance, have you included the impact of option expense if any in the back half of '05?

還有一個簡短的後續問題。在您的指導方針中，是否考慮了 2005 年下半年選擇權費用的影響（如有）？

The impact based upon the stock options that exists at this point is very minimal. It is about 1 cent for 2005 because we have not been granting stock options in a large amount in the last couple of years anticipating that this will be expensed. So we have been granting restrictive stocks. We have been expensing all along. So our estimate is for the unvested portioned starting July 1 through the end of the year the impact is about 1 cent.

目前基於現有股票選擇權的影響非常小。2005 年約為 1 美分，因為過去幾年我們沒有大量授予股票選擇權，預計這部分支出將被計入費用。所以我們一直在授予限制性股票。我們一直都是按費用報銷的。因此，我們估計，從 7 月 1 日到年底，未歸屬部分的影響約為 1 美分。

And that is included already?

那已經包含在內了嗎？

Yes.

是的。

Perfect. Thank you.

完美的。謝謝。

James Abbott, FBR.

James Abbott，FBR。

I wanted to see if I could understand on the commercial -- obviously some very strong performance out of both of those, both the trade finance and the commercial business. I wanted to see if that was a drawdown or the majority of that was drawing upon lines of credit, existing lines of credit, new issues of lines of credit. Maybe if you can give us some color on there, and then I have a follow-up question related to the mortgage portfolio.

我想看看我是否能理解商業方面的情況——顯然，貿易融資和商業業務都取得了非常強勁的業績。我想看看這筆錢是提取的，還是大部分是動用了信貸額度、現有信貸額度或新發行的信貸額度。如果您能提供一些細節訊息，或許會有幫助。另外，我還有一個關於抵押貸款組合的後續問題。

It is a combination. We do have an increase in the outstanding, the commitment balance, along with that with the drawdown on the commercial business and trade finance.

它是組合體。由於商業業務和貿易融資的提取，我們的未償債務和承諾餘額確實增加。

Would you say it is a fairly strong increase in the lines of credit to try I mean you saw (multiple speakers)

您認為信貸額度大幅成長是否算是嘗試？我的意思是，您也看到了（多位發言者）

I guess in terms of percentage, we looked at it in terms of a gross total. We still need to work very hard to improve these two segments obviously. But the base is small relatively speaking compared with our real estate loans. So that the increase, even though it is pretty substantial in terms of percentage, but obviously it should not be as difficult as like, for example, if we look at commercial real estate, we already have 2.5 billion. Any kind of percentage increase ought to be a lot harder in the future simply because that means that we have to really do a lot of loans to get even a 20 percent increase.

我想，就百分比而言，我們是根據總額來計算的。顯然，我們還需要非常努力地改進這兩個面向。但與我們的房地產貸款相比，這個基數相對較小。因此，儘管成長幅度相當大，但顯然不應該像例如商業房地產那麼困難，我們已經有 25 億。未來任何百分比的成長都應該會變得更加困難，因為這意味著我們必須發放大量貸款才能實現即使 20% 的成長。

But in terms of the commercial business and trade finance, it is a very very competitive market here in California. But we are continuing to bring in more seasoned lenders, and hopefully that would help us to help these two line items to get bigger. That also is the reason attributable to our expectation of compensation increase in 2005.

但就商業和貿易融資而言，加州的市場競爭非常非常激烈。但我們正在繼續引進更多經驗豐富的貸款機構，希望這能幫助我們擴大這兩個計畫的規模。這也是我們預期 2005 年薪酬會成長的原因。

The commitments for both the business and trade finance during the year for the 12 months increased about 250 million. So that contributed to the increase in the outstanding balance.

過去 12 個月，商業和貿易融資承諾額增加了約 2.5 億。因此，這導致了未償餘額的增加。

Then, it adds 250 million for the whole year for commercial business?

那麼，它全年的商業活動就增加2.5億嗎？

And trade finance. (multiple speakers) and the commitment. That is the commitment amount. (multiple speakers)

還有貿易融資。 （多位發言人）以及承諾。這就是承諾金額。 （多人發言）

Commitment for both of them combined.

他們兩人共同做出的承諾。

Okay, for the full year. Okay. I appreciate that. That is very good color. I appreciate that. I wondered if on the mortgage portfolio, I wondered if there was a decline at all in the pipeline between, say, the October timeframe and last time we had a conference call and then the January timeframe? Have you seen any market decline in the pipeline?

好的，一整年。好的。我很感激。這個顏色真好看。我很感激。我想知道，在抵押貸款組合方面，比如說，從 10 月份到我們上次電話會議，再到 1 月份這段時間，待處理的貸款項目是否有所減少？您認為未來市場會出現下滑趨勢嗎？

Not that much only because we're doing more and more bigger size loans, which we do not offer fixed-rate. We offer adjustables, and that market is not as competitive as the conforming loans. So in total production so far it has been quite stabilized, and the pipeline seems to be okay.

之所以沒有那麼多，只是因為我們發放的貸款金額越來越大，而這類貸款我們不提供固定利率。我們提供可調利率貸款，但這個市場的競爭不如標準貸款市場激烈。所以到目前為止，總產量已經相當穩定，生產線似乎也沒問題。

Are you talking about residential mortgage?

您說的是房屋抵押貸款嗎？

I was actually primarily thinking of the commercial --

我當時其實主要想到的是那則廣告——

You are talking about all the mortgage --

你說的都是房貸的事兒——

Yes.

是的。

I'm sorry. You know what? I was referring to the single-family mortgages. In talking about the pipeline in total, it is still a pretty healthy pipeline.

對不起。你知道嗎？我指的是獨棟住宅抵押貸款。從整體來看，這條管道仍然相當健康。

As of now, I would say that we do not see any sign of any kind of dramatic slowdown or anything like that a long time, just as healthy as it was. But you know with anticipation of rate, let's say continuing to increase, we just think that naturally you have to slow down a little bit. We just have not seen it yet.

就目前而言，我認為我們沒有看到任何跡象表明經濟會大幅放緩或類似的情況，經濟狀況將長期保持健康。但是，你知道，如果預期利率繼續上升，我們自然會認為必須稍微放慢速度。我們只是還沒看到而已。

Okay. And then I guess the last question I had is a more macro question on the LA area. I saw an article recently that the vacancy rates of office buildings anyway -- I think it was Cushman Wakefield put the study together -- had dropped into the 14 level range, down fairly substantially over the last six months. What sort of color can you give us on that? Obviously it is very strong business development in the area, but do you see -- do you anticipate a lot of new developments going up as we approach the 10 percent level? Do we see a 10 percent level? What can you give us on that?

好的。最後，我想問的是一個關於洛杉磯地區的更宏觀的問題。我最近看到一篇文章，說辦公大樓的空置率已經降至 14 級左右——我想這項研究是由 Cushman Wakefield 完成的——在過去六個月裡下降了相當大一部分。你能提供我們什麼樣的顏色？顯然，該地區的商業發展非常強勁，但是，隨著我們接近 10% 的水平，您是否看到——您是否預計會有很多新的開發項目拔地而起？我們會看到10%的水平嗎？您能提供什麼資訊？

I think it is a very healthy market in terms of the business seems to be hiring more people. There are more expansion per se and, therefore, fill up the -- I mean reduce the vacancy rate you know to a pretty -- to a very healthy level.

我認為這是一個非常健康的市場，從商業角度來看，企業似乎正在招募更多員工。擴張本身會更多，因此——我的意思是，將空置率降低到相當健康的水平。

I guess what I'm looking at in terms of whether there will be a lot of new development the answer is that at this point due to the limitation of space there is only so much development that can be done there. However, I mean there is no question that one of the most significant developments in Los Angeles has been this change of the demographic view of the urban infield housing. Something that I would say five, 10 years ago, is absolutely not possible in Southern California to have people to not live in a three-bedroom, two-car garage type of home with a backyard. But it seems like that most of the housing development that has been happening in Southern California for the last 12 months or so has been in like downtown and in these urban infield in terms of like loft apartments, condos, in high-rise, that type of development, which I think is very healthy for the Southern California.

我想，就未來是否會有許多新的發展而言，答案是，目前由於空間有限，那裡能進行的發展也僅限於此。然而，毫無疑問，洛杉磯最重要的發展之一就是城市中心住宅人口結構觀念的轉變。五年前、十年前，在南加州，人們絕對不可能不住在三房、雙車位車庫、有後院的房子。但似乎過去 12 個月左右，南加州的大部分住房開發都集中在市中心和城市腹地，例如閣樓公寓、公寓、高層建築等類型的開發，我認為這對南加州來說是非常健康的。

Because as long as people are now willing to live closer in town, live closer to work, are willing to walk to work and so forth, as long as that trend continues, I think that by and large also helps solve some of the housing problem and transportation problem and the desirability of living in Los Angeles because of the huge commuting time. Because now people do have choices. They wanted to commute in five minutes. They can just live in an apartment on the fifth floor that is closer to work than, you know, an hour and 20 minutes away from the suburb.

因為只要人們現在願意住在離城鎮更近的地方，離工作地點更近的地方，願意步行上班等等，只要這種趨勢繼續下去，我認為這在很大程度上也有助於解決一些住房問題、交通問題以及由於通勤時間過長而導致的洛杉磯居住吸引力問題。因為現在人們有了選擇。他們希望通勤時間縮短到五分鐘。他們可以住在五樓的公寓裡，這樣離工作地點更近，而不是像現在這樣，離郊區一個小時二十分鐘車程。

So that has been happening. So I would say that would this healthy increase of occupancy which we do see a vacancy rate give us the comfort that that as of now even if rates still keep rising, I don't think it is going to severely hurt the Southern California market.

事情就是這樣發生的。所以我認為，入住率的健康成長（我們看到空置率下降）讓我們感到安心，即使房價繼續上漲，我認為也不會對南加州市場造成嚴重損害。

Fantastic, appreciate it and great job on the quarter again.

太棒了，非常感謝，本季又做得非常出色。

(OPERATOR INSTRUCTIONS). Campbell Chaney, Sanders Morris Harris.

（操作說明）坎貝爾·錢尼，桑德斯·莫里斯·哈里斯。

I'm just coming back to this margin issue again. I can't figure it out in my head how a 5 basis point move is going to be 5 basis points of the margin. Is it really that the 25 basis points Fed funds rate will have a 5 percent favorable impact on the margin, or is it going to be a 25 basis point move will have a bottom-line move in the margin?

我又要重新討論利潤率問題了。我實在想不明白，5個基點的變動怎麼會是5個基點的利潤率變動。聯邦基金利率上調 25 個基點真的會對利潤率產生 5% 的有利影響嗎？還是說，這 25 個基點的變動會對利潤率產生根本性的影響？

No. The way we calculate the 25 basis point increase in the Fed funds rate translates to 5 basis point increase in that interest margin. So if we start with 4.34, then we are estimating that it will become 4.39.

不。我們計算聯邦基金利率上調 25 個基點的方式，相當於該利率利差上調 5 個基點。所以如果我們從 4.34 開始，那麼我們估計它會變成 4.39。

Okay. If that is the case, then why such a low guidance for the year on your margin of only 5 basis points?

好的。如果真是這樣，那麼為什麼你們的利潤率只有 5 個基點，卻給出瞭如此低的全年業績預期？

Because we are assuming no rate increases.

因為我們假設利率不會上漲。

None whatsoever?

一個也沒有？

None, none. Because we just don't like to speculate how much rates will increase. So we just assume no rate increases, and we give you guidance for what would happen to the margin when the rate increased.

沒有，沒有。因為我們不喜歡猜測利率會上漲多少。因此，我們假設利率不會上漲，並為您提供利率上漲時利潤率會發生什麼變化的指引。

So hypothetically if the Fed continues its measured pace, your margin will increase 5 basis points for the next 100 basis points up. So you could be updating your guidance then everything else being equal.

因此，假設聯準會繼續保持其穩健的步伐，那麼在接下來的 100 個基點上漲中，你的利潤率將增加 5 個基點。所以，在其他條件相同的情況下，你可以更新你的指導方針。

If the rate increases, yes.

如果利率上升，是的。

I've got you. Okay. Thank you. That clears it up.

我罩著你。好的。謝謝。這樣就清楚了。

Thank you. I would now like to turn the call back over to Mr. Steven Canup for closing remarks.

謝謝。現在我謹將電話交還給史蒂文·卡納普先生，請他作總結發言。

Well, thank you all for attending our conference call. If there are no more questions, we plan to talk to you all again in April. Thank you.

感謝各位參加我們的電話會議。如果沒有其他問題，我們計劃在四月再次與大家見面。謝謝。

Thank you. Ladies and gentlemen, this concludes today's conference call. You may now disconnect.

謝謝。女士們、先生們，今天的電話會議到此結束。您現在可以斷開連線了。