What does commercial banking — charge for funds used mean?

The internal cost charged to the commercial banking unit for the capital it uses to fund loans.

How do you interpret commercial banking — charge for funds used?

An increase reflects higher internal funding costs, which can compress segment margins if not offset by higher loan yields.

How does commercial banking — charge for funds used compare across companies?

Standard internal transfer pricing metric used by large banks to measure segment profitability.

East-West Bancorp EWBC Commercial Banking — Charge For Funds Used

Discontinued — last reported Q1 '19

Similar metrics at other companies

WALCommercial Segment — Interest Expense, Funds Transfer Pricing

$69.7M-47.1%

WALCorporate & Other — Interest Expense, Funds Transfer Pricing

$183.23M+113%

WALConsumer Related Segment — Interest Expense, Funds Transfer Pricing

-$305.4M-13.1%

FHNCommercial, Consumer & Wealth — Funds transfer pricing

$93M-15.5%

WALCorporate And Other Segment — Interest Expense, Funds Transfer Pricing

$235.7M+70.3%

WALInterest Expense, Funds Transfer Pricing

$0—

Other financials

Income statement

See full

Revenue$773.7M+11.8%

Net income$357.8M+23.3%

EPS (diluted)$2.57+23.6%

Balance sheet

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Cash & equivalents$4.4B+28.7%

Total debt$184.3M+49.8%

Total equity$9.0B+13.5%

Total assets$82.9B+8.8%

Cash flow

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Operating cash flow$428.6M+54.2%

CapEx$99.0M+3,852%

Free cash flow$329.6M+19.7%

Valuation

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Market cap$17.37B+18.2%

Enterprise value$13.12B+14.7%

P/E12.5×-0.1×

P/S5.8×+0.2×

Profitability

See full

Net margin46.2%+2.2pp

FCF margin58%—

Returns & leverage

See full

Return on equity16.5%+0.8pp

Debt / equity0×0.0×

Where this comes from

Reported directly by East-West Bancorp in its filing.

Tagged under the XBRL concept ewbc:ChargeForFundsUsed.

The official record: East-West Bancorp’s 10-Q, filed May 8, 2019, on SEC EDGAR. View the filing →

Questions, answered.

What does commercial banking — charge for funds used mean?: The internal cost charged to the commercial banking unit for the capital it uses to fund loans.
How do you interpret commercial banking — charge for funds used?: An increase reflects higher internal funding costs, which can compress segment margins if not offset by higher loan yields.
How does commercial banking — charge for funds used compare across companies?: Standard internal transfer pricing metric used by large banks to measure segment profitability.