##### 



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
 For the quarterly period ended March 31, 2007.
 OR
 o
    
    Transition Report under Section 13 or 15(d) of the Securities Exchange Act of 1934.
 For the transition period from  to .
 Commission File Number: 000-24947
 UCBH HOLDINGS, INC.
  Delaware
    
    94-3072450(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)555 Montgomery Street, San Francisco, California
    
    94111(Address of principal executive offices)
    
    (Zip Code)
 (415) 315-2800
 þ o
  þ o o
 o þ




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##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Table of Contents
 PagePART IItem 1 Financial Statements
    
    
    1Item 2 Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    16Item 3 Quantitative and Qualitative Disclosures About Market Risk
    
    
    39Item 4 Controls and Procedures
    
    
    39PART IIItem 1 Legal Proceedings
    
    
    40Item 1A Risk Factors
    
    
    40Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    40Item 3 Defaults Upon Senior Securities
    
    
    40Item 4 Submission of Matters to a Vote of Security Holders
    
    
    40Item 5 Other Information
    
    
    40Item 6 Exhibits
    
    
    41SIGNATURES
    
    
    44




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##### 



PART I  FINANCIAL INFORMATION
Item 1. Financial Statements
 UCBH HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
 March 31,
    
    
    December 31,2007
    
    
    2006ASSETSNoninterest bearing cash
    
    $
    90,769
    
    
    $
    112,343Interest bearing cash
    
    
    143,863
    
    
    
    92,049Federal funds sold
    
    
    208,091
    
    
    
    150,027Cash and cash equivalents
    
    
    442,723
    
    
    
    354,419Securities purchased under agreements to resell
    
    
    150,000
    
    
    
    175,000Investment and mortgage-backed securities available for sale, at fair value
    
    
    1,791,076
    
    
    
    2,149,456Investment and mortgage-backed securities held to maturity, at cost (fair value of
$292,877 and $295,446 at March 31, 2007, and December 31, 2006, respectively)
    
    
    288,451
    
    
    
    290,673Federal Home Loan Bank stock, Federal Reserve Bank stock and other equity investments
    
    
    111,248
    
    
    
    110,775Loans held for sale, net of valuation allowance
    
    
    115,548
    
    
    
    142,861Loans held in portfolio
    
    
    6,942,843
    
    
    
    6,635,660Allowance for loan losses
    
    
    (62,804
    )
    
    
    (62,015
    )Loans held in portfolio, net
    
    
    6,880,039
    
    
    
    6,573,645Accrued interest receivable
    
    
    53,088
    
    
    
    50,803Premises and equipment, net
    
    
    112,877
    
    
    
    115,610Goodwill
    
    
    228,555
    
    
    
    226,780Core deposit intangibles, net
    
    
    19,516
    
    
    
    28,325Mortgage servicing rights, net
    
    
    12,946
    
    
    
    13,273Other assets
    
    
    100,316
    
    
    
    114,794Total assets
    
    $
    10,306,383
    
    
    $
    10,346,414LIABILITIES AND STOCKHOLDERS EQUITYNoninterest bearing deposits
    
    $
    746,407
    
    
    $
    767,714Interest bearing deposits
    
    
    6,552,761
    
    
    
    6,435,131Total deposits
    
    
    7,299,168
    
    
    
    7,202,845Securities sold under agreements to repurchase
    
    
    300,000
    
    
    
    401,600Short-term borrowings
    
    
    441,879
    
    
    
    654,636Subordinated debentures
    
    
    240,549
    
    
    
    240,549Accrued interest payable
    
    
    21,241
    
    
    
    21,018Long-term borrowings
    
    
    1,079,747
    
    
    
    906,651Other liabilities
    
    
    102,298
    
    
    
    133,044Total liabilities
    
    
    9,484,882
    
    
    
    9,560,343Commitments and contingencies (Note 15)Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued and outstanding
    
    
    
    
    
    
    Common stock, $0.01 par value, 180,000,000 shares authorized at March 31, 2007, and
December 31, 2006; 99,900,138 and 99,448,181 shares issued and outstanding at March 31,
2007, and December 31, 2006, respectively
    
    
    999
    
    
    
    994Additional paid-in capital
    
    
    348,932
    
    
    
    341,616Retained earnings
    
    
    488,650
    
    
    
    464,616Accumulated other comprehensive loss
    
    
    (17,080
    )
    
    
    (21,155
    )Total stockholders equity
    
    
    821,501
    
    
    
    786,071Total liabilities and stockholders equity
    
    $
    10,306,383
    
    
    $
    10,346,414
  -1-




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##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
 Three Months Ended March 31,2007
    
    
    2006Interest and dividend income:Loans
    
    $
    131,651
    
    
    $
    105,538Investment and mortgage-backed securities:Taxable
    
    
    23,514
    
    
    
    13,757Tax exempt
    
    
    3,306
    
    
    
    2,692FHLB Stock
    
    
    922
    
    
    
    450Federal funds sold and deposits with banks
    
    
    2,289
    
    
    
    1,015Securities purchased under agreements to resell
    
    
    2,264
    
    
    
    Total interest and dividend income
    
    
    163,946
    
    
    
    123,452Interest expense:Deposits
    
    
    65,994
    
    
    
    44,396Securities sold under agreements to repurchase
    
    
    3,261
    
    
    
    29Short-term borrowings and federal funds purchased
    
    
    5,192
    
    
    
    3,445Subordinated debentures
    
    
    4,553
    
    
    
    2,715Long-term borrowings
    
    
    11,116
    
    
    
    7,287Total interest expense
    
    
    90,116
    
    
    
    57,872Net interest income
    
    
    73,830
    
    
    
    65,580Provision for loan losses
    
    
    1,048
    
    
    
    307Net interest income after provision for loan losses
    
    
    72,782
    
    
    
    65,273Noninterest income:Commercial banking fees
    
    
    4,745
    
    
    
    4,095Service charges on deposits
    
    
    1,529
    
    
    
    740Gain (loss) on sale of securities, net
    
    
    3,076
    
    
    
    (2
    )Gain on sale of SBA loans, net
    
    
    765
    
    
    
    581Gain on sale of multifamily and commercial real estate loans, net
    
    
    1,394
    
    
    
    3,911Lower of cost or market adjustment on loans held for sale
    
    
    (14
    )
    
    
    (97
    )Equity loss in other equity investments
    
    
    (473
    )
    
    
    (458
    )Acquisition termination fee
    
    
    
    
    
    
    5,000Other fees
    
    
    1,423
    
    
    
    307Total noninterest income
    
    
    12,445
    
    
    
    14,077Noninterest expense:Personnel
    
    
    24,264
    
    
    
    25,734Occupancy
    
    
    4,848
    
    
    
    3,699Data processing
    
    
    2,280
    
    
    
    1,969Furniture and equipment
    
    
    2,166
    
    
    
    1,660Professional fees and contracted services
    
    
    2,329
    
    
    
    3,385Deposit insurance
    
    
    292
    
    
    
    211Communication
    
    
    701
    
    
    
    599Core deposit intangible amortization
    
    
    1,008
    
    
    
    555Other general and administrative
    
    
    6,007
    
    
    
    4,936Total noninterest expense
    
    
    43,895
    
    
    
    42,748Income before income tax expense
    
    
    41,332
    
    
    
    36,602Income tax expense
    
    
    14,301
    
    
    
    13,183Net income
    
    $
    27,031
    
    
    $
    23,419Earnings per share:Basic
    
    $
    0.27
    
    
    $
    0.25Diluted
    
    $
    0.26
    
    
    $
    0.24Dividends declared per share
    
    $
    0.03
    
    
    $
    0.03
  -2-




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##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders Equity and Comprehensive Income
 AccumulatedAdditional
    
    
    
    
    
    
    Other
    
    
    TotalCommon Stock
    
    
    Paid-In
    
    
    Retained
    
    
    Comprehensive
    
    
    Stockholders
    
    
    ComprehensiveShares
    
    
    Amount
    
    
    Capital
    
    
    Earnings
    
    
    Loss(1)
    
    
    Equity
    
    
    IncomeBalance at December
31, 2005
    
    
    94,037,878
    
    
    $
    940
    
    
    $
    247,340
    
    
    $
    375,220
    
    
    $
    (19,986
    )
    
    $
    603,514Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,419
    
    
    
    
    
    
    
    23,419
    
    
    $
    23,419Other comprehensive
income, net of tax
benefit of $5,320
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,353
    )
    
    
    (7,353
    )
    
    
    (7,353
    )Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    16,066Stock options exercised,
including related tax
benefit
    
    
    199,809
    
    
    
    2
    
    
    
    1,862
    
    
    
    
    
    
    
    
    
    
    
    1,864Stock compensation charge
    
    
    
    
    
    
    
    
    
    
    308
    
    
    
    
    
    
    
    
    
    
    
    308Cash dividend of $0.030
per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,826
    )
    
    
    
    
    
    
    (2,826
    )Balance at March 31, 2006
    
    
    94,237,687
    
    
    $
    942
    
    
    $
    249,510
    
    
    $
    395,813
    
    
    $
    (27,339
    )
    
    $
    618,926Balance at December 31,
2006
    
    
    99,448,181
    
    
    $
    994
    
    
    $
    341,616
    
    
    $
    464,616
    
    
    $
    (21,155
    )
    
    $
    786,071Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,031
    
    
    
    
    
    
    
    27,031
    
    
    $
    27,031Other comprehensive
income, net of tax
$2,793
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,075
    
    
    
    4,075
    
    
    
    4,075Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    31,106Stock options exercised,
including related tax
benefit
    
    
    451,957
    
    
    
    5
    
    
    
    6,546
    
    
    
    
    
    
    
    
    
    
    
    6,551Stock compensation charge
    
    
    
    
    
    
    
    
    
    
    770
    
    
    
    
    
    
    
    
    
    
    
    770Cash dividend of $0.030
per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,997
    )
    
    
    
    
    
    
    (2,997
    )Balance at March 31, 2007
    
    
    99,900,138
    
    
    $
    999
    
    
    $
    348,932
    
    
    $
    488,650
    
    
    $
    (17,080
    )
    
    $
    821,501
 
 (1)
    
    Accumulated Other Comprehensive Loss arises solely from net unrealized losses on
investment and mortgage-backed securities available for sale, presented net of tax.  -3-




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UCBH HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
 Three Months Ended March 31,2007
    
    
    2006Cash flows from operating activities:Net income
    
    $
    27,031
    
    
    $
    23,419Adjustments to reconcile net income to net cash provided by operating activities:Provision for loan losses
    
    
    1,048
    
    
    
    307Amortization of net deferred loan fees
    
    
    (2,701
    )
    
    
    (1,767
    )Amortization of net securities premiums and discounts
    
    
    (611
    )
    
    
    (28
    )Federal Home Loan Bank stock dividend
    
    
    (700
    )
    
    
    (447
    )Amortization of intangibles
    
    
    1,921
    
    
    
    1,196Depreciation and amortization of premises and equipment
    
    
    2,628
    
    
    
    2,307Gain on sale of loans originated in held in portfolio, securities, and other assets, net
    
    
    (2,620
    )
    
    
    (3,979
    )Lower of cost or market adjustment on loans held for sale
    
    
    6
    
    
    
    97Equity loss in other equity investments
    
    
    523
    
    
    
    458Stock compensation expense, net of tax benefit related to nonqualified stock option grants
    
    
    650
    
    
    
    270Excess tax benefit from stock option exercises
    
    
    (1,233
    )
    
    
    Loss on extinguishment of secured borrowings
    
    
    
    
    
    
    5Other, net
    
    
    104
    
    
    
    326Changes in operating assets and liabilities:Decrease (increase) in loans originated in held for sale
    
    
    9,965
    
    
    
    (8,038
    )Increase in accrued interest receivable
    
    
    (2,285
    )
    
    
    (2,173
    )Decrease (increase) in other assets
    
    
    15,193
    
    
    
    (976
    )Increase (decrease) in accrued interest payable
    
    
    223
    
    
    
    (247
    )Decrease in other liabilities
    
    
    (30,798
    )
    
    
    (8,652
    )Net cash provided by operating activities
    
    
    18,344
    
    
    
    2,078Cash flows from investing activities:Payment of acquisition related expenditures
    
    
    
    
    
    
    (460
    )Purchase of securities purchased under agreements to resell
    
    
    (150,000
    )
    
    
    Proceeds from maturity of securities purchased under agreements to resell
    
    
    175,000
    
    
    
    Investment and mortgage-backed securities, available for sale:Principal payments and maturities
    
    
    577,155
    
    
    
    27,756Purchases
    
    
    (1,331,188
    )
    
    
    (9,894
    )Sales
    
    
    1,056,161
    
    
    
    7,231Called
    
    
    64,963
    
    
    
    Investment and mortgage-backed securities, held to maturity:Principal payments and maturities
    
    
    2,225
    
    
    
    3,662Proceeds from redemption of Federal Home Loan Bank stock
    
    
    1,908
    
    
    
    Purchase of Federal Home Loan Bank stock
    
    
    (1,651
    )
    
    
    (9,587
    )Proceeds from redemption of Federal Reserve Bank Stock
    
    
    1,267
    
    
    
    Funding of other equity investments
    
    
    (232
    )
    
    
    (505
    )Proceeds from the sale of loans originated in held in portfolio
    
    
    88,550
    
    
    
    185,288Loans originated in held in portfolio funded and purchased, net of principal collections
    
    
    (371,401
    )
    
    
    (247,246
    )Purchases of premises and other equipment
    
    
    (1,421
    )
    
    
    (1,873
    )Other investing activities, net
    
    
    16
    
    
    
    122Net cash provided by (used in) investing activities
    
    
    111,352
    
    
    
    (45,506
    )Cash flows from financing activities:Net increase (decrease) in demand deposits, NOW, money market and savings accounts
    
    
    72,543
    
    
    
    (22,949
    )Net increase in time deposits
    
    
    23,780
    
    
    
    35,281Net decrease in short-term borrowings
    
    
    (212,757
    )
    
    
    (39,197
    )Proceeds from securities sold under agreements to repurchase
    
    
    
    
    
    
    50,000Payments of securities sold under agreements to repurchase
    
    
    (101,600
    )
    
    
    Proceeds from long-term borrowings
    
    
    201,362
    
    
    
    1,267Principal payments of long-term borrowings
    
    
    (28,288
    )
    
    
    (2,291
    )Proceeds from stock option exercises
    
    
    5,318
    
    
    
    1,465Excess tax benefit from stock option exercises
    
    
    1,233Payment of cash dividend on common stock
    
    
    (2,983
    )
    
    
    (2,351
    )Net cash
(used in) provided by financing activities
    
    
    (41,392
    )
    
    
    21,225Net increase (decrease) in cash and cash equivalents
    
    
    88,304
    
    
    
    (22,203
    )Cash and cash equivalents at beginning of period
    
    
    354,419
    
    
    
    203,065Cash and cash equivalents at end of period
    
    $
    442,723
    
    
    $
    180,862
  -4-




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UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)
 1.
    
    Basis of Presentation and Summary of Significant Accounting and Reporting PoliciesBasis of Presentation and Principles of ConsolidationThe unaudited interim consolidated financial statements include the accounts of UCBH Holdings, Inc.
(UCBH), the bank holding company of United Commercial Bank (UCB), and its consolidated
subsidiaries (collectively referred to as the Company, we, us and our). The consolidated
results exclude ten special purpose trusts owned by UCBH, which were created for issuing guaranteed
preferred beneficial interests in UCBHs junior subordinated debentures. In accordance with
Financial Accounting Standards Board (the FASB) Interpretation No. (FIN) 46R, Consolidation of
Variable Interest Entities, an interpretation of ARB No. 51, these special purpose trusts are
excluded from the consolidated results as UCBH is not considered to be the primary beneficiary of
these trusts. All significant intercompany transactions and balances have been eliminated in
consolidation. In the opinion of management, the unaudited consolidated financial statements
contain all adjustments consisting only of a normal and recurring nature, which are considered
necessary for a fair presentation of the financial condition and results of operations for such
periods. The unaudited consolidated financial statements should be read in conjunction with the
audited consolidated financial statements and related notes included in the Companys annual report
on Form 10-K for the year ended December 31, 2006.The unaudited consolidated financial statements of the Company have been prepared in accordance
with accounting principles generally accepted in the United States of America (GAAP) for interim
financial statements and the instructions to Form 10-Q pursuant to Rule 10-01, Interim Financial
Statements, of Regulation S-X promulgated by the Securities and Exchange Commission (the SEC).
Accordingly, the unaudited consolidated financial statements do not include all of the disclosures
required by GAAP for complete financial statements. The December 31, 2006, consolidated balance
sheet was derived from audited financial statements, but does not include all disclosures required
by GAAP. Results as of and for the three months ended March 31, 2007, are not necessarily
indicative of results that may be expected for any other interim period or the year as a whole.The results of operations for the three months ended March 31, 2007, include the results of
operations of Summit Bank Corporation, which was acquired on December 29, 2006.Use of Estimates in Preparation of Financial StatementsThe preparation of financial statements in conformity with GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period. Actual results could differ
from those estimated results.ReclassificationCertain reclassifications have been made to prior periods consolidated financial statements to
conform to the March 31, 2007, presentation.Allowance for Loan LossesThe allowance for loan losses represents our estimate of the losses that are inherent in the loans
held in portfolio. Similarly, loans held for sale are excluded from any of the information
included in Note 8, Loans Held in Portfolio and Allowance for Loan Losses. UCB continuously
monitors the quality of its loan portfolio and maintains an allowance for loan losses sufficient to
absorb losses inherent in the portfolio.In determining the general allowance, UCB applies loss factors, differentiated by an internal
credit risk rating system, to its major loan portfolio categories (based primarily on loan type).
The loss factors are developed from
 -5-




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UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 actual historic losses, and reflect comparative analysis with peer group loss rates and expected
losses, which is in turn based on estimated probabilities of default and loss given default.
Additionally, loss factors incorporate qualitative adjustments that reflect an assessment of
internal and external influences on credit quality that have not yet been reflected in the
historical loss or risk-rating data. These influences may include elements such as portfolio
credit quality trends and changes in concentrations, growth, or credit underwriting. UCBs
qualitative adjustments also include an economic surcharge factor to adjust loss factors in
recognition of the impact various macro-economic factors have on portfolio performance. The
quantitative analysis also resulted in establishing a minimum loss factor for each of the major
loan portfolio categories to better reflect minimum inherent loss in all portfolios including those
with limited historic loss experience.UCB also estimates a reserve related to unfunded commitments and other off-balance sheet credit
exposure. In assessing the adequacy of this reserve, UCB uses an approach similar to the approach
used in the development of the allowance for loan losses. The reserve for unfunded commitments is
included in other liabilities on the statement of financial position.2.
    
    Recent Accounting PronouncementsFair Value Option for Financial Assets and Financial LiabilitiesIn February 2007, the Financial Accounting Standards Board (the FASB) issued SFAS No. 159, The
Fair Value Option for Financial Assets and Financial Liabilities  Including an Amendment of FASB
Statement No. 115. SFAS No. 159 provides entities with an option to report selected financial
assets and liabilities at fair value. Unrealized gains and losses on items for which the fair
value option has been elected are reported in earnings. SFAS No. 159 is effective for fiscal years
beginning after November 15, 2007. Early adoption, effective January 1, 2007, is permitted as long
as companies adopt SFAS No. 157 concurrently with SFAS No. 159. The Company will adopt SFAS No.
159 effective January 1, 2008. In connection therewith, the Company is in the process of
evaluating the impact that adopting SFAS No. 159 will have on its financial position and results of
operations.Fair Value MeasurementsIn September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. SFAS No. 157 defines
fair value, establishes a framework for measuring fair value and expands disclosures about fair
value measurements. SFAS No. 157 clarifies the principle that fair value should be based on the
assumptions market participants would use when pricing an asset or liability and establishes a fair
value hierarchy that prioritizes the information used to develop those assumptions. Under the
standard, fair value measurements would be separately disclosed by level within the fair value
hierarchy. SFAS No. 157 is effective for financial statements issued for fiscal years beginning
after November 15, 2007, and interim periods within those fiscal years, with early adoption
permitted. The Company will adopt SFAS. No 157 effective January 1, 2008. In connection
therewith, the Company is in the process of evaluating the impact that adopting SFAS No. 157 will
have on its financial position and results of operations.Accounting for Uncertainty in Income TaxesIn July 2006, the FASB issued FIN 48, Accounting for Uncertainty in Income Taxes, an interpretation
of FASB Statement No. 109. FIN 48 clarifies the accounting for income tax uncertainties that have
been recognized in an enterprises financial statements in accordance with SFAS No. 109, Accounting
for Income Taxes. FIN 48 prescribes a recognition threshold and measurement attribute for the
financial statement recognition and measurement of a tax position taken or expected to be taken in
a tax return. FIN 48 requires that the Company recognize in the financial statements the impact of
a tax position, if that position is more likely than not of being sustained on audit, based on the
technical merits of the position. FIN 48 also provides additional guidance on accounting for tax
uncertainties, including derecognition, classification, interest and penalties, accounting in
interim
 -6-




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##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 periods, disclosure and transition. The provisions of FIN 48 are effective for fiscal years
beginning after December 15, 2006, with the cumulative effect of the change in accounting principle
recorded as an adjustment to opening retained earnings. The Company adopted the provisions of FIN
48 effective January 1, 2007. The impact of adopting FIN 48 resulted in a cumulative effect
adjustment with a $2.6 million decrease in goodwill, and an offsetting decrease in current taxes
payable. There were no cumulative effect adjustments to the Companys opening retained earnings as
of January 1, 2007. The Company accrued $393,000 in interest expense and no liability for penalties as of
March 31, 2007. Additionally, in connection with the adoption of FIN 48, the Company will continue
to classify interest and penalties related to unrecognized tax positions as components of interest
expense.Accounting for Servicing of Financial AssetsIn March 2006, the FASB issued SFAS No. 156, Accounting for Servicing of Financial Assets, an
amendment of FASB Statement No. 140. SFAS No. 156 permits entities to choose either to measure
servicing rights subsequent to initial valuation at fair value and report changes in fair value in
earnings or to amortize the servicing rights in proportion to and over the estimated net servicing
income or loss and assess the servicing rights for impairment or the need for an increased
obligation. SFAS No. 156 also clarifies when a servicer should separately recognize servicing
assets and liabilities, requires that all separately recognized assets and liabilities be initially
measured at fair value, if practicable, permits a one-time reclassification of available for sales
securities to trading securities by an entity with recognized servicing rights and requires
additional disclosures for all separately recognized servicing assets and liabilities. SFAS No.
156 is effective as of the beginning of an entitys fiscal year that begins after September 15,
2006. In accordance with SFAS No. 156, the Company will initially measure mortgage servicing
rights at fair value and will continue to subsequently amortize its mortgage servicing rights based
on estimated future net servicing income, with quarterly assessments for impairment. The Company
adopted the provisions of SFAS No. 156 effective January 1, 2007. The adoption did not have a
material impact on the Companys financial position or results of operations.Accounting for Certain Hybrid Financial InstrumentsIn February 2006, the FASB issued SFAS No. 155, Accounting for Certain Hybrid Financial
Instruments, an amendment of FASB Statements No. 133 and 140. SFAS No. 155 permits fair value
remeasurement for any hybrid financial instrument that contains an embedded derivative that
otherwise would require bifurcation; clarifies which interest-only strips and principal-only strips
are not subject to the requirements of SFAS No. 133; establishes a requirement to evaluate
interests in securitized financial assets to identify interests that are freestanding derivatives
or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation;
clarifies that concentrations of credit risk in the form of subordination are not embedded
derivatives; and amends SFAS No. 140 to eliminate the prohibition on a qualifying special-purpose
entity from holding a derivative financial instrument that pertains to a beneficial interest other
than another derivative financial instrument. The new standard is effective for all financial
instruments acquired or issued after the beginning of the Companys first fiscal year that begins
after September 15, 2006. The adoption of SFAS No. 155 did not have a material impact on the
Companys financial position or results of operations.3.
    
    Business CombinationsCAB Holding, LLCOn January 10, 2007, UCBH and CAB Holding, LLC (CAB), a Delaware limited liability company
registered under the Bank Holding Company Act of 1956, as amended, and the holding company of The
Chinese American Bank, entered into an Agreement and Plan of Merger. The value of the transaction
is approximately $130.7 million, which is comprised of $65.1 million in cash and the issuance of
3,711,580 shares of UCBH common stock valued at $65.6 million (based on the average closing price
for UCBHs common stock around the announcement date of January 11, 2007). CAB may terminate the
transaction for various reasons prior to the consummation of the merger,
 -7-




---



##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 including but not limited to a substantial decline in the
Average Closing Price (as defined in the agreement), unless UCBH
agrees to a corresponding increase in
the number of UCBH shares. Similarly, UCBH may terminate the transaction for various reasons prior to the
consummation of the merger, including but not limited to a substantial
increase in the Average Closing Price, unless CAB agrees to a
corresponding reduction in the number of UCBH shares. If either CAB or UCBH terminates the transaction upon certain
conditions, such party shall pay a break-up fee to the other. This acquisition increased the
Companys presence in the New York metropolitan area. The transaction, which is subject to
regulatory approval, is anticipated to close in the second quarter of 2007. CAB had total assets
of $333.0 million and total deposits of $281.7 million as of December 31, 2006.Business Development Bank Ltd.On March 26, 2007, UCB entered into two agreements to
purchase the Business Development
Bank Ltd. (BDB), a wholly foreign owned enterprise established and existing under the laws of the
Peoples Republic of China, for a total consideration of $205.0 million in cash. The parties to
the agreements may terminate the transaction for various reasons prior to the
consummation of the acquisition. This acquisition will provide the Company with bank branches in
Shanghai and Shantou, China and representative offices in Beijing and Guangzhou, China, which will
in turn accelerate the implementation of the Companys Greater China expansion strategy. The
transaction is subject to both U.S. regulatory and China Banking
Regulatory Commission approvals, and
is anticipated to close in the fourth quarter of 2007. BDB had total assets of $217.2 million,
total loans of $188.0 million and total deposits of $25.5 million as of December 31, 2006.4.
    
    Cash and Due from BanksUCB is required to maintain cash reserves in a noninterest-bearing account at the FRB of San
Francisco. Through the FRB, the cash in this account in excess of UCBs reserve requirement
(Federal Funds) is available for overnight and one day period sales to other institutions with
accounts at the FRB. UCB received interest on these sales at the prevailing federal funds rate.
At March 31, 2007, and December 31, 2006, the reserve requirement was $8.4 million and $7.6
million, respectively.5.
    
    Securities Purchased Under Agreements to ResellInformation regarding outstanding securities purchased under agreements to resell (the Resell
Agreements) as of and for the three months ended March 31, 2007, and as of and for the year ended
December 31, 2006, were as follows (dollars in thousands):
 March 31,
    
    December 31,2007
    
    2006Average balance outstanding
    
    $
    125,278
    
    
    $
    62,740Maximum amount outstanding at any month end period
    
    
    175,000
    
    
    
    175,000Balance outstanding at end of period
    
    
    150,000
    
    
    
    175,000Weighted average interest rate during the period
    
    
    7.23
    %
    
    
    7.41
    %Weighted average interest rate at end of period
    
    
    6.45
    %
    
    
    7.37
    %Weighted average remaining term to maturity at end of period (in years)
    
    
    9.9
    
    
    
    9.6
  -8-




---



##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 6.
    
    Investment and Mortgage-Backed Securities
 Gross
    
    
    Gross
    
    
    
    
    
    
    Less Than 12 Months
    
    
    12 Months or More
    
    
    TotalAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Market
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedDescription
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    Value
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesInvestment securities
available for sale:Collateralized debt
obligations
    
    $
    38,445
    
    
    $
    
    
    
    $
    (410
    )
    
    $
    38,035
    
    
    $
    29,731
    
    
    $
    (214
    )
    
    $
    8,304
    
    
    $
    (196
    )
    
    $
    38,035
    
    
    $
    (410
    )U.S. Government
sponsored
enterprises notes
    
    
    583,766
    
    
    
    146
    
    
    
    (3,809
    )
    
    
    580,103
    
    
    
    437,501
    
    
    
    (544
    )
    
    
    118,614
    
    
    
    (3,265
    )
    
    
    556,115
    
    
    
    (3,809
    )U.S. Government
sponsored
enterprises
discount notes
    
    
    161,865
    
    
    
    17
    
    
    
    
    
    
    
    161,882
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Municipals
    
    
    52,179
    
    
    
    119
    
    
    
    (213
    )
    
    
    52,085
    
    
    
    31,678
    
    
    
    (213
    )
    
    
    
    
    
    
    
    
    
    
    31,678
    
    
    
    (213
    )Other
    
    
    10,000
    
    
    
    
    
    
    
    (175
    )
    
    
    9,825
    
    
    
    9,825
    
    
    
    (175
    )
    
    
    
    
    
    
    
    
    
    
    9,825
    
    
    
    (175
    )Total investment
securities available
for sale
    
    
    846,255
    
    
    
    282
    
    
    
    (4,607
    )
    
    
    841,930
    
    
    
    508,735
    
    
    
    (1,146
    )
    
    
    126,918
    
    
    
    (3,461
    )
    
    
    635,653
    
    
    
    (4,607
    )Mortgage-backed
securities available
for sale:FNMA
    
    
    422,447
    
    
    
    8
    
    
    
    (11,267
    )
    
    
    411,188
    
    
    
    133,484
    
    
    
    (2,512
    )
    
    
    277,058
    
    
    
    (8,755
    )
    
    
    410,542
    
    
    
    (11,267
    )GNMA
    
    
    81,233
    
    
    
    6
    
    
    
    (2,656
    )
    
    
    78,583
    
    
    
    
    
    
    
    
    
    
    
    78,098
    
    
    
    (2,656
    )
    
    
    78,098
    
    
    
    (2,656
    )FHLMC
    
    
    263,171
    
    
    
    
    
    
    
    (8,215
    )
    
    
    254,956
    
    
    
    4,844
    
    
    
    (3
    )
    
    
    250,107
    
    
    
    (8,212
    )
    
    
    254,951
    
    
    
    (8,215
    )Other
    
    
    207,591
    
    
    
    264
    
    
    
    (3,436
    )
    
    
    204,419
    
    
    
    24,899
    
    
    
    (71
    )
    
    
    166,347
    
    
    
    (3,365
    )
    
    
    191,246
    
    
    
    (3,436
    )Total mortgage-backed
securities available
for sale
    
    
    974,442
    
    
    
    278
    
    
    
    (25,574
    )
    
    
    949,146
    
    
    
    163,227
    
    
    
    (2,586
    )
    
    
    771,610
    
    
    
    (22,988
    )
    
    
    934,837
    
    
    
    (25,574
    )Total investment and
mortgage-backed
securities available
for sale
    
    
    1,820,697
    
    
    
    560
    
    
    
    (30,181
    )
    
    
    1,791,076
    
    
    
    671,962
    
    
    
    (3,732
    )
    
    
    898,528
    
    
    
    (26,449
    )
    
    
    1,570,490
    
    
    
    (30,181
    )Investment securities
held to maturity:Municipal securities
    
    
    222,662
    
    
    
    6,276
    
    
    
    (32
    )
    
    
    228,906
    
    
    
    3,662
    
    
    
    (26
    )
    
    
    416
    
    
    
    (6
    )
    
    
    4,078
    
    
    
    (32
    )Mortgage-backed
securities held to
maturity:FNMA
    
    
    4,326
    
    
    
    
    
    
    
    (158
    )
    
    
    4,168
    
    
    
    
    
    
    
    
    
    
    
    4,168
    
    
    
    (159
    )
    
    
    4,168
    
    
    
    (159
    )GNMA
    
    
    60,925
    
    
    
    
    
    
    
    (1,641
    )
    
    
    59,284
    
    
    
    
    
    
    
    
    
    
    
    59,284
    
    
    
    (1,641
    )
    
    
    59,284
    
    
    
    (1,641
    )FHLMC
    
    
    538
    
    
    
    
    
    
    
    (19
    )
    
    
    519
    
    
    
    
    
    
    
    
    
    
    
    519
    
    
    
    (19
    )
    
    
    519
    
    
    
    (19
    )Total mortgage-backed
securities held to
maturity
    
    
    65,789
    
    
    
    
    
    
    
    (1,818
    )
    
    
    63,971
    
    
    
    
    
    
    
    
    
    
    
    63,971
    
    
    
    (1,819
    )
    
    
    63,971
    
    
    
    (1,819
    )Total investment and
mortgage-backed
securities held to
maturity
    
    
    288,451
    
    
    
    6,276
    
    
    
    (1,850
    )
    
    
    292,877
    
    
    
    3,662
    
    
    
    (26
    )
    
    
    64,387
    
    
    
    (1,825
    )
    
    
    68,049
    
    
    
    (1,851
    )Total securities
    
    $
    2,109,148
    
    
    $
    6,836
    
    
    $
    (32,031
    )
    
    $
    2,083,953
    
    
    $
    675,624
    
    
    $
    (3,758
    )
    
    $
    962,915
    
    
    $
    (28,274
    )
    
    $
    1,638,539
    
    
    $
    (32,032
    )
  -9-




---



##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 The municipal securities are issued by states and their political subdivisions in the U.S. These
securities either have bond insurance or guarantees that provide investment grade ratings of AAA or
AA. There have been no deteriorations of credit quality that would contribute to impairment. The
unrealized losses will decline as interest rates fall to the purchase yield and as the securities
approach contractual or expected maturity.Since UCB has the intent and ability to hold its available-for-sale securities until recovery of
the par amount, which could be maturity, UCB has concluded that the decline in value on these
securities is temporary.The amortized cost and approximate market value of investment and mortgage-backed securities
classified as available for sale and held to maturity, along with the portions of the portfolio
with unrealized loss positions at December 31, 2006, were as follows (dollars in thousands):
 Gross
    
    
    Gross
    
    
    
    
    
    
    Less Than 12 Months
    
    
    12 Months or More
    
    
    TotalAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Market
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedDescription
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    Value
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesInvestment securities
available for sale:Collateralized debt
obligations
    
    $
    38,445
    
    
    $
    5
    
    
    $
    (316
    )
    
    $
    38,134
    
    
    $
    14,888
    
    
    $
    (113
    )
    
    $
    8,296
    
    
    $
    (203
    )
    
    $
    23,184
    
    
    $
    (316
    )U.S. Government
sponsored
enterprises notes
    
    
    588,621
    
    
    
    120
    
    
    
    (5,701
    )
    
    
    583,040
    
    
    
    263,885
    
    
    
    (1,566
    )
    
    
    125,194
    
    
    
    (4,135
    )
    
    
    389,079
    
    
    
    (5,701
    )U.S. Government
sponsored
enterprises
discount notes
    
    
    249,024
    
    
    
    61
    
    
    
    
    
    
    
    249,085
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    U.S. Treasury Bills.
    
    
    73,183
    
    
    
    17
    
    
    
    
    
    
    
    73,200
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Municipals
    
    
    58,325
    
    
    
    
    
    
    
    
    
    
    
    58,325
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Commercial paper
    
    
    49,952
    
    
    
    
    
    
    
    
    
    
    
    49,952
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    10,000
    
    
    
    
    
    
    
    (125
    )
    
    
    9,875
    
    
    
    9,875
    
    
    
    (125
    )
    
    
    
    
    
    
    
    
    
    
    9,875
    
    
    
    (125
    )Total investment
securities available
for sale
    
    
    1,067,550
    
    
    
    203
    
    
    
    (6,142
    )
    
    
    1,061,611
    
    
    
    288,648
    
    
    
    (1,804
    )
    
    
    133,490
    
    
    
    (4,338
    )
    
    
    422,138
    
    
    
    (6,142
    )Mortgage-backed
securities available
for sale:FNMA
    
    
    515,711
    
    
    
    391
    
    
    
    (13,405
    )
    
    
    502,697
    
    
    
    148,236
    
    
    
    (3,025
    )
    
    
    284,506
    
    
    
    (10,380
    )
    
    
    432,742
    
    
    
    (13,405
    )GNMA
    
    
    87,866
    
    
    
    
    
    
    
    (3,261
    )
    
    
    84,605
    
    
    
    
    
    
    
    
    
    
    
    78,742
    
    
    
    (3,261
    )
    
    
    78,742
    
    
    
    (3,261
    )FHLMC
    
    
    313,991
    
    
    
    140
    
    
    
    (9,847
    )
    
    
    304,284
    
    
    
    7,424
    
    
    
    (32
    )
    
    
    255,779
    
    
    
    (9,815
    )
    
    
    263,203
    
    
    
    (9,847
    )Other
    
    
    200,832
    
    
    
    16
    
    
    
    (4,589
    )
    
    
    196,259
    
    
    
    
    
    
    
    
    
    
    
    171,423
    
    
    
    (4,589
    )
    
    
    171,423
    
    
    
    (4,589
    )Total mortgage-backed
securities available
for sale
    
    
    1,118,400
    
    
    
    547
    
    
    
    (31,102
    )
    
    
    1,087,845
    
    
    
    155,660
    
    
    
    (3,057
    )
    
    
    790,450
    
    
    
    (28,045
    )
    
    
    946,110
    
    
    
    (31,102
    )Total investment and
mortgage-backed
securities available
for sale
    
    
    2,185,950
    
    
    
    750
    
    
    
    (37,244
    )
    
    
    2,149,456
    
    
    
    444,308
    
    
    
    (4,861
    )
    
    
    923,940
    
    
    
    (32,383
    )
    
    
    1,368,248
    
    
    
    (37,244
    )Investment securities
held to maturity:Municipal securities
    
    
    222,638
    
    
    
    6,750
    
    
    
    (30
    )
    
    
    229,358
    
    
    
    4,531
    
    
    
    (24
    )
    
    
    416
    
    
    
    (6
    )
    
    
    4,947
    
    
    
    (30
    )Mortgage-backed
securities held to
maturity:FNMA
    
    
    4,372
    
    
    
    
    
    
    
    (172
    )
    
    
    4,200
    
    
    
    
    
    
    
    
    
    
    
    4,200
    
    
    
    (172
    )
    
    
    4,200
    
    
    
    (172
    )GNMA
    
    
    63,122
    
    
    
    
    
    
    
    (1,755
    )
    
    
    61,367
    
    
    
    
    
    
    
    
    
    
    
    61,367
    
    
    
    (1,755
    )
    
    
    61,367
    
    
    
    (1,755
    )FHLMC
    
    
    541
    
    
    
    
    
    
    
    (20
    )
    
    
    521
    
    
    
    
    
    
    
    
    
    
    
    521
    
    
    
    (20
    )
    
    
    521
    
    
    
    (20
    )Total mortgage-backed
securities held to
maturity
    
    
    68,035
    
    
    
    
    
    
    
    (1,947
    )
    
    
    66,088
    
    
    
    
    
    
    
    
    
    
    
    66,088
    
    
    
    (1,947
    )
    
    
    66,088
    
    
    
    (1,947
    )Total investment and
mortgage-backed
securities held to
maturity
    
    
    290,673
    
    
    
    6,750
    
    
    
    (1,977
    )
    
    
    295,446
    
    
    
    4,531
    
    
    
    (24
    )
    
    
    66,504
    
    
    
    (1,953
    )
    
    
    71,035
    
    
    
    (1,977
    )Total securities
    
    $
    2,476,623
    
    
    $
    7,500
    
    
    $
    (39,221
    )
    
    $
    2,444,902
    
    
    $
    448,839
    
    
    $
    (4,885
    )
    
    $
    990,444
    
    
    $
    (34,336
    )
    
    $
    1,439,283
    
    
    $
    (39,221
    )
 As of December 31, 2006, the net unrealized loss on securities was $31.7 million. The net
unrealized loss on securities that are available for sale was $36.5 million. Net of a tax benefit
of $15.3 million, the unrealized $21.2 million loss is included in other comprehensive loss as a
reduction to stockholders equity. The $4.8 million net unrealized gain between the carrying value
and market value of securities that are held to maturity has not been recognized in the
consolidated financial statements for the year ended December 31, 2006.7.
    
    Loans Held for SaleThe components of loans held for sale as of March 31, 2007, and December 31, 2006, were as follows
(dollars in thousands):
 March 31,
    
    
    December 31,2007
    
    
    2006Commercial:Secured by real estate  nonresidential
    
    $
    113,172
    
    
    $
    141,348Business
    
    
    1,181
    
    
    
    1,203Total commercial loans
    
    
    114,353
    
    
    
    142,551Consumer:Residential mortgage (one to four family)
    
    
    1,195
    
    
    
    310Loans held for sale (1)
    
    $
    115,548
    
    
    $
    142,861
 
 (1)
    
    Amounts reflect net unamortized deferred loan fees,
purchase premiums and discounts of $198,000 and $213,000 at March 31, 2007,
and December 31, 2006, respectively. -10-




---



##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 8.
    
    Loans Held in Portfolio and Allowance for Loan LossesThe components of loans held in portfolio as of March 31, 2007, and December 31, 2006, were as
follows (dollars in thousands):
 March 31,
    
    
    December 31,2007
    
    
    2006Commercial:Secured by real estate  nonresidential
    
    $
    2,479,457
    
    
    $
    2,341,572Secured by real estate  multifamily
    
    
    1,313,606
    
    
    
    1,275,594Construction
    
    
    1,154,176
    
    
    
    1,054,302Business
    
    
    1,488,723
    
    
    
    1,461,322Total commercial loans
    
    
    6,435,962
    
    
    
    6,132,790Consumer:Residential mortgage (one-to-four family)
    
    
    455,328
    
    
    
    448,895Other (1)
    
    
    51,553
    
    
    
    53,975Total consumer loans
    
    
    506,881
    
    
    
    502,870Loans held in portfolio (2)
    
    
    6,942,843
    
    
    
    6,635,660Allowance for loan losses
    
    
    (62,804
    )
    
    
    (62,015
    )Net loans held in portfolio
    
    $
    6,880,039
    
    
    $
    6,573,645
 
 (1)
    
    Amount includes deposit overdrafts of $2.4 million and $999,000 at March
31, 2007, and December 31, 2006, respectively.(2)
    
    Amounts reflect net unamortized deferred loan fees, purchase premiums
and discounts of $21.0 million and $25.8 million at March 31, 2007, and
December 31, 2006, respectively.  2007
    
    
    2006Allowance for
    
    
    
    
    
    
    
    
    
    
    Allowance forLosses 
    
    
    Total
    
    
    
    
    
    
    Losses 
    
    
    TotalAllowance for
    
    
    Unfunded
    
    
    Allowance for
    
    
    Allowance for
    
    
    Unfunded
    
    
    Allowance forLoan Losses
    
    
    Commitments
    
    
    Losses
    
    
    Loan Losses
    
    
    Commitments
    
    
    LossesBalance at beginning of period
    
    $
    62,015
    
    
    $
    6,833
    
    
    $
    68,848
    
    
    $
    64,542
    
    
    $
    3,402
    
    
    $
    67,944Provision for losses
    
    
    2,545
    
    
    
    (1,497
    )
    
    
    1,048
    
    
    
    (4
    )
    
    
    311
    
    
    
    307Loans charged off
    
    
    (1,772
    )
    
    
    
    
    
    
    (1,772
    )
    
    
    (2,853
    )
    
    
    
    
    
    
    (2,853
    )Recoveries of loans previously charged off
    
    
    16
    
    
    
    
    
    
    
    16
    
    
    
    121
    
    
    
    
    
    
    
    121Balance at end of period
    
    $
    62,804
    
    
    $
    5,336
    
    
    $
    68,140
    
    
    $
    61,806
    
    
    $
    3,713
    
    
    $
    65,519
   -11-




---



##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 9.
    
    BorrowingsSecurities Sold Under Agreements to RepurchaseInformation regarding outstanding securities sold under agreements to repurchase (the Repurchase
Agreements) as of and for the three months ended March 31, 2007, and as of and for the year ended
December 31, 2006, were as follows (dollars in thousands):
 March 31,
    
    December 31,2007
    
    2006Average balance outstanding
    
    
    318,956
    
    
    $
    162,124Maximum amount outstanding at any month end period
    
    
    312,215
    
    
    
    401,600Balance outstanding at end of period
    
    
    300,000
    
    
    
    401,600Weighted average interest rate during the period
    
    
    4.09
    %
    
    
    3.56
    %Weighted average interest rate at end of period
    
    
    4.43
    %
    
    
    3.71
    %Weighted average remaining term to maturity at end of period (in years)
    
    
    7.9
    
    
    
    6.1
  Short-Term Borrowings
  March 31,
    
    
    December 31,Federal Home Loan Bank advances and other short-term borrowings:
    
    2007
    
    
    2006Average balance outstanding
    
    $
    401,428
    
    
    $
    224,234Maximum amount outstanding at any month end period
    
    
    637,787
    
    
    
    654,636Balance outstanding at end of period
    
    
    441,879
    
    
    
    654,636Weighted average interest rate during the period
    
    
    5.16
    %
    
    
    4.52
    %Weighted average interest rate at end of period
    
    
    5.29
    %
    
    
    5.21
    %Weighted average remaining term to maturity at end of period (in years)
    
    
    
    
    
    
    
 Short-term borrowings with the FHLB totaled $340 million at March 31, 2007, and $534.2 million at
December 31, 2006. At March 31, 2007, the advances were secured with $38.7 million of
mortgage-backed securities and $3.77 billion of loans, and at December 31, 2006, the advances were
secured with $41.6 million of mortgage-backed securities and $3.34 billion of loans secured the
advances.10.
    
    Earnings Per ShareThe antidilutive outstanding stock options of UCBH common stock that were excluded from the
computation of diluted earnings per share for the three months ended March 31, 2007 and 2006, were
2,856,300 shares and 6,424,849 shares, respectively. The stock options of UCBH common stock are
considered antidilutive if assumed proceeds per share exceed the average market price of UCBHs
common stock during the relevant periods. Assumed proceeds include proceeds from the exercise of
stock options of UCBH common stock, as well as unearned compensation and certain deferred tax
benefits related to stock options.
  Income
    
    
    Shares
    
    
    Per Share(Numerator)
    
    
    (Denominator)
    
    
    AmountThree months ended March 31, 2007:Net income  basic
    
    $
    27,031
    
    
    
    99,731,221
    
    
    $
    0.27Effect of stock options
    
    
    
    
    
    
    3,531,505Net income  diluted
    
    $
    27,031
    
    
    
    103,262,726
    
    
    $
    0.26Three months ended March 31, 2006:Net income  basic
    
    $
    23,419
    
    
    
    94,114,819
    
    
    $
    0.25Effect of stock options
    
    
    
    
    
    
    3,744,738Net income  diluted
    
    $
    23,419
    
    
    
    97,859,557
    
    
    $
    0.24
 -12-




---



##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 11.
    
    Stock-Based CompensationThe Company has one stock option plan, the 2006 Equity Incentive Plan, as amended (the Plan).
The Plan was approved by its stockholders and provides for the granting of stock-based compensation
awards, including options, to eligible officers, employees and directors of the Company. Stock
option awards are approved by UCBHs Board of Directors and are granted at the fair market value of
UCBHs common stock on the date of the grant. The options vest over a period determined at the time
the options are granted, generally three years of continuous service, and have a maximum term of
ten years. Certain options awards provide for accelerated vesting if there is a change in control,
as defined in the Plan. As of March 31, 2007, the Company had 456,818 shares of common stock
reserved for the issuance of options under the Plan.The Company used the modified prospective method of adoption. Under this adoption method,
compensation expense recognized subsequent to adoption includes (a) compensation cost for all
share-based payments granted prior to but not yet vested as of January 1, 2006, based on the grant
date fair value estimated in accordance with the original provisions of SFAS No. 123, and (b)
compensation cost for all share-based payments granted subsequent to January 1, 2006, based on the
grant date fair value estimated in accordance with the provisions of SFAS No. 123R. Awards granted
after January 1, 2006 are valued at fair value in accordance with provisions of SFAS 123R and
recognized on a straight-line basis over the service periods of each award. No share-based employee
compensation cost has been reflected in the Companys results of operations prior to the adoption
of SFAS No. 123R and the results for prior periods have not been restated. The Company estimated
forfeiture rates for the first quarter of 2007 based on its historical experience.In order to estimate the fair value of stock options, the Company used the Black-Scholes option
valuation model, which was developed for use in estimating the fair value of publicly traded
options which have no vesting restrictions and are fully transferable. Option valuation models
require the input of highly subjective assumptions and these assumptions can vary over time.
  WeightedWeighted
    
    AverageAverage
    
    Remaining
    
    AggregateNumber of
    
    Exercise
    
    Contractual
    
    IntrinsicShares
    
    Price
    
    Term
    
    ValueOptions outstanding at December 31, 2006
    
    
    14,834,395
    
    
    $
    12.78
    
    
    
    5.82
    
    
    $
    70,878Granted
    
    
    472,600
    
    
    
    17.61Exercised
    
    
    (451,957
    )
    
    
    11.77Canceled
    
    
    (16,933
    )
    
    
    17.35Expired
    
    
    (39,400
    )
    
    
    20.56Options outstanding at March 31, 2007
    
    
    14,798,705
    
    
    $
    12.94
    
    
    
    5.79
    
    
    $
    191,513
    Weighted
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    Average
    
    
    
    
    
    AverageOptions
    
    Exercise
    
    Remaining
    
    Options
    
    ExerciseExercise Price
    
    Outstanding
    
    Price
    
    Life
    
    Exercisable
    
    Price$1.88-$2.25
    
    
    1,481,402
    
    
    $
    1.88
    
    
    
    1.75
    
    
    
    1,481,402
    
    
    $
    1.88$2.26-$4.51
    
    
    126,324
    
    
    
    2.90
    
    
    
    3.00
    
    
    
    126,324
    
    
    
    2.90$4.52-$6.77
    
    
    3,750,458
    
    
    
    6.15
    
    
    
    4.07
    
    
    
    3,750,458
    
    
    
    6.15$6.78-$9.03
    
    
    264,158
    
    
    
    7.21
    
    
    
    4.76
    
    
    
    264,158
    
    
    
    7.21$9.04-$11.29
    
    
    523,666
    
    
    
    10.12
    
    
    
    5.55
    
    
    
    523,666
    
    
    
    10.12$11.30-$13.55
    
    
    299,433
    
    
    
    12.38
    
    
    
    6.05
    
    
    
    299,433
    
    
    
    12.38$13.56-$15.81
    
    
    493,164
    
    
    
    15.00
    
    
    
    6.78
    
    
    
    401,664
    
    
    
    14.82$15.82-$18.07
    
    
    1,921,500
    
    
    
    17.37
    
    
    
    8.64
    
    
    
    832,201
    
    
    
    17.15$18.08-$20.33
    
    
    5,233,800
    
    
    
    18.84
    
    
    
    7.11
    
    
    
    5,004,634
    
    
    
    18.83$20.33-$22.59
    
    
    704,800
    
    
    
    21.28
    
    
    
    6.15
    
    
    
    704,800
    
    
    
    21.28Total/Average
    
    
    14,798,705
    
    
    
    12.94
    
    
    
    5.79
    
    
    
    13,388,740
    
    
    
    12.44
  -13-




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##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 12.
    
    Income Tax ExpenseThe Company adopted the provisions of FIN 48 on January 1, 2007. The impact of adopting FIN 48
was a cumulative effect adjustment with a $2.6 million decrease in goodwill, and an
offsetting decrease in current taxes payable. There were no cumulative effect adjustments to the
Companys opening retained earnings as of January 1, 2007.
The Company accrued $393,000 in
interest expense and no liability for penalties as of March 31, 2007. Additionally, in connection with the
adoption of FIN 48, the Company will continue to classify interest and penalties related to
unrecognized tax positions as components of interest expense.The fiscal years 2003 through 2005 remain open for Internal Revenue Service audit purposes, the
years 2002 through 2005 remain open for California Franchise Tax Board purposes and the years 2003
through 2005 remain open for New York State, New York City and Massachusetts purposes. The 2006
federal and state income tax returns have not yet been filed.13.
    
    Related Party TransactionsSeveral members of the Board of Directors and executive officers of the Company have deposits with
UCB that are made in the ordinary course of business with the same terms and conditions, including
interest rates, as those prevailing at the same time for comparable transactions with other
customers. The total deposits for these related parties were $7.4 million and $6.7 million at
March 31, 2007, and December 31, 2006, respectively. Additionally, UCB has adopted a policy that
prohibits loans or extensions of credit to members of the Board of Directors and affiliated persons
of the Company, and their related interests.14.
    
    Derivative Financial Instruments and Financial Instruments with Off-Balance-Sheet RiskThe contractual or notional amounts of derivative financial instruments and financial instruments
with off-balance-sheet risk as of March 31, 2007, and December 31, 2006, were as follows (dollars
in thousands):
 March 31,
    
    
    December 31,2007
    
    
    2006Commitments to extend credit:Consumer (including residential mortgage)
    
    $
    81,237
    
    
    $
    83,648Commercial (excluding construction)
    
    
    1,296,061
    
    
    
    1,150,599Construction
    
    
    948,911
    
    
    
    889,294Letters of credit
    
    
    148,480
    
    
    
    140,684Foreign exchange contracts receivable
    
    
    (464,584
    )
    
    
    (385,301
    )Foreign exchange contracts payable
    
    
    195,423
    
    
    
    220,515Put options to buy
    
    
    13,766
    
    
    
    5,329Put options to sell
    
    
    (13,766
    )
    
    
    (5,329
    )Interest rate swap contract
    
    
    
    
    
    
    25,000Interest rate floor contract
    
    
    25,000
    
    
    
    25,000Unfunded CRA investment commitments
    
    
    3,463
    
    
    
    3,623Total
    
    $
    2,234,491
    
    
    $
    2,153,062
 15.
    
    Contingent LiabilitiesThe Company is subject to pending or threatened actions and proceedings arising in the normal
course of business. In the opinion of management, the ultimate disposition of all pending or
threatened actions and proceedings will not have a material adverse effect on the Companys results
of operations or financial condition.
 -14-




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##### 



UCBH HOLDINGS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements-Continued
(Unaudited)
 16.
    
    Supplemental Cash Flow InformationThe supplemental cash flow information for the three months ended March 31, 2007 and 2006, was as
follows (dollars in thousands):
 2007
    
    2006Cash paid during the period for:Interest
    
    $
    89,893
    
    
    $
    58,118Income taxes
    
    
    13,817
    
    
    
    13,754Noncash investing and financing activities:Stock warrants acquired with issuance of commercial loans
    
    $
    
    
    
    $
    (129
    )Income tax benefit from stock options exercised
    
    
    
    
    
    
    399Transfer of loans from held for sale to held in portfolio
    
    
    36,253
    
    
    
    827Transfer of loans to held for sale from held in portfolio
    
    
    39,746
    
    
    
    248,644Transfer of other real estate owned to other assets from loans held in portfolio
    
    
    
    
    
    
    
 17.
    
    Segment InformationThe Company designates the internal organization that is used by management for making operating
decisions and assessing performance as the source of its reportable segments. The Company has
determined that its reportable segments are those that are based on the Companys method of
internal reporting. The Company has determined that it has two reportable segments, Domestic
Banking and Other. Other segment
consists of the Companys Hong Kong operations, UCB Investment
Services, Inc. and
UCB Asset Management, Inc. The UCBH Holdings, Inc. column consists of UCBH, which reflects the
holding company activities. The intersegment column consists of the UCBH and UCB elimination
units, which reflects the elimination of intersegment transactions. Substantially all interest
income was earned in the United States and in Hong Kong, China. The determination of interest
income earned by country is impracticable and is not disclosed.The segment information as of March 31, 2007, and December 31, 2006, and for the three months ended
March 31, 2007 and 2006, were as follows (dollars in thousands):
 UCBHDomestic
    
    
    
    
    
    Total
    
    Holdings,Banking
    
    Other
    
    Segments
    
    Inc.
    
    Intersegment
    
    ConsolidatedThree Months Ended March 31, 2007:Total interest and dividend income
    
    $
    158,605
    
    
    $
    8,434
    
    
    $
    167,039
    
    
    $
    2
    
    
    $
    (3,095
    )
    
    $
    163,946Total interest expense
    
    
    (83,182
    )
    
    
    (5,445
    )
    
    
    (88,627
    )
    
    
    (4,585
    )
    
    
    3,096
    
    
    
    (90,116
    )Net interest income (expense)
    
    
    75,423
    
    
    
    2,989
    
    
    
    78,412
    
    
    
    (4,582
    )
    
    
    
    
    
    
    73,830Core deposit intangible impairment loss
    
    
    (1,008
    )
    
    
    
    
    
    
    (1,008
    )
    
    
    
    
    
    
    
    
    
    
    (1,008
    )Income tax benefit (expense)
    
    
    (16,364
    )
    
    
    (168
    )
    
    
    (16,532
    )
    
    
    2,231
    
    
    
    
    
    
    
    (14,301
    )Net income (loss)
    
    
    29,902
    
    
    
    948
    
    
    
    30,850
    
    
    
    27,031
    
    
    
    (30,850
    )
    
    
    27,031Three Months Ended March 31, 2006:Total interest and dividend income
    
    
    120,498
    
    
    
    4,450
    
    
    
    124,948
    
    
    
    
    
    
    
    (1,496
    )
    
    
    123,452Total interest expense
    
    
    (53,468
    )
    
    
    (3,168
    )
    
    
    (56,636
    )
    
    
    (2,732
    )
    
    
    1,496
    
    
    
    (57,872
    )Net interest income (expense)
    
    
    67,030
    
    
    
    1,282
    
    
    
    68,312
    
    
    
    (2,732
    )
    
    
    
    
    
    
    65,580Core deposit intangible impairment loss
    
    
    (294
    )
    
    
    
    
    
    
    (294
    )
    
    
    
    
    
    
    
    
    
    
    (294
    )Income tax benefit (expense)
    
    
    (13,564
    )
    
    
    (63
    )
    
    
    (13,627
    )
    
    
    444
    
    
    
    
    
    
    
    (13,183
    )Net income (loss)
    
    
    26,131
    
    
    
    (1,486
    )
    
    
    24,645
    
    
    
    23,416
    
    
    
    (24,642
    )
    
    
    23,419
 18.
    
    Subsequent EventsOn April 26, 2007, UCBHs Board of Directors declared a quarterly cash dividend of $0.03 per share
of common stock. The dividend will be paid on July 12, 2007, to stockholders of record as of June 30, 2007.
 -15-




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##### 



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 FORWARD LOOKING STATEMENTS
 This document, including information included or incorporated by reference in this document,
contains certain forward-looking statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements provide current expectations or forecasts of future
events and include, among other things:
 
    
    statements with respect to UCBH Holdings, Inc. and its
consolidated subsidiaries (collectively, the Company) beliefs,
plans, objectives, goals, guidelines, expectations, anticipations,
and future financial condition, results of operations and
performance; and
 
    
    statements preceded or identified by words, such as expects,
anticipates, intends, plans, believes, seeks,
estimates, will, should, could, projects and may,
might or words of similar import.
 These forward-looking statements are based upon managements current beliefs and expectations and
are not guarantees of future performance, nor should they be relied upon as representing
managements views as of any subsequent date. These forward-looking statements are also inherently
subject to significant business, economic and competitive uncertainties, risks and contingencies,
many of which are difficult to predict and generally beyond managements control. In addition,
these forward-looking statements are subject to assumptions with respect to future business
strategies and decisions that are subject to change and actual results, performance or achievements
may be materially different from the anticipated results, performance or achievements discussed,
expressed or implied by these forward-looking statements. Factors that might cause such
differences include, but are not limited to the following:
 
    
    the Companys ability to successfully execute its business plans and achieve its objectives;
 
    
    changes in political and economic conditions, including the economic effects of terrorist attacks against the United
States and related events;
 
    
    changes in financial market conditions, either nationally, internationally or locally in areas in which the Company
conducts its operations;
 
    
    expansion into new market areas;
 
    
    fluctuations in the equity and fixed-income markets;
 
    
    changes in interest rates;
 
    
    asset and liability sensitivity of our balance sheet;
 
    
    acquisitions and integration of acquired businesses;
 
    
    deterioration in asset or credit quality;
 
    
    increases in the levels of losses, customer bankruptcies, claims and assessments;
 
    
    deposit renewals and ability to attract and retain core deposits;
 
    
    changes in the availability of capital;
 
    
    continuing consolidation in the financial services industry;
 
    
    new litigation or changes in existing litigation;
 
    
    success in gaining regulatory approvals, when required;
 
    
    changes in consumer spending and savings habits;
 
    
    increased competitive challenges and expanding product and pricing pressures among financial institutions, whether
banks, investment banks, insurance companies or others, in the Companys markets;
 
    
    technological changes;
 
    
    demographic changes;
 
    
    legislation or regulatory changes which adversely affect the Companys operations and businesses;
 
    
    the Companys ability to meet regulatory requirements; and
 
    
    changes in accounting principles generally accepted in the United States of America.
 You are cautioned not to place undue reliance on these forward-looking statements, which speak only
as of the date of this document or the date of any document incorporated by reference in this
document. All subsequent written and oral forward-looking statements concerning matters addressed
in this document and attributable to the Company or any person acting on the Companys behalf are
expressly qualified in their entirety by the cautionary
 -16-




---



##### 



statements contained or referred to in this section. Except to the extent required by applicable
law or regulation, the Company undertakes no obligation to update these forward-looking statements
to reflect events, developments or circumstances after the date of this document or to reflect the
occurrence of future events.
 MANAGEMENT OVERVIEW
    CORPORATE DEVELOPMENTS
 Acquisition
of CAB Holding, LLC
 Acquisition of Business Development Bank Ltd.
 CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT ESTIMATES
  Allowance for Loan Losses
  -17-




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##### 



-18-




---



##### 



Income Taxes
     Recent Accounting Pronouncements
 Fair Value Option for Financial Assets and Financial Liabilities
 The
Fair Value Option for Financial Assets and Financial Liabilities  Including an Amendment of FASB
Statement No. 115
 Fair Value Measurements
 Fair Value Measurements
 Accounting for Uncertainty in Income Taxes
 Accounting for Uncertainty in Income Taxes, an interpretation
of FASB Statement No. 109 Accounting
for Income Taxe
 -19-




---



##### 



Accounting for Servicing of Financial Assets
 Accounting for Servicing of Financial Assets, an
amendment of FASB Statement No. 140
 Accounting for Certain Hybrid Financial Instruments
 Accounting for Certain Hybrid Financial
Instruments, an amendment of FASB Statements No. 133 and 140
 -20-




---



##### 



RESULTS OF OPERATIONS
 Financial Highlights
 Three Months Ended March 31,Increase (Decrease)2007
    
    
    2006
    
    
    Amount
    
    
    %Operating Data:Total interest & dividend income
    
    $
    163,946
    
    
    $
    123,452
    
    
    $
    40,494
    
    
    
    32.80
    %Total interest expense
    
    
    (90,116
    )
    
    
    (57,872
    )
    
    
    32,244
    
    
    
    55.72Net interest income
    
    
    73,830
    
    
    
    65,580
    
    
    
    8,250
    
    
    
    12.58Provision for loan losses
    
    
    (1,048
    )
    
    
    (307
    )
    
    
    741
    
    
    
    241.37Net interest income after provision for loan losses
    
    
    72,782
    
    
    
    65,273
    
    
    
    7,509
    
    
    
    11.50Total noninterest income
    
    
    12,445
    
    
    
    14,077
    
    
    
    (1,632
    )
    
    
    (11.59
    )Total noninterest expense
    
    
    (43,895
    )
    
    
    (42,748
    )
    
    
    1,147
    
    
    
    2.68Income before income tax expense
    
    
    41,332
    
    
    
    36,602
    
    
    
    4,730
    
    
    
    12.92Income tax expense
    
    
    (14,301
    )
    
    
    (13,183
    )
    
    
    1,118
    
    
    
    8.48Net income
    
    $
    27,031
    
    
    $
    23,419
    
    
    $
    3,612
    
    
    
    15.42Per Share Data:Basic earnings per share
    
    $
    0.27
    
    
    $
    0.25
    
    
    $
    0.02
    
    
    
    8.00
    %Diluted earnings per share
    
    $
    0.26
    
    
    
    0.24
    
    
    
    0.02
    
    
    
    8.33Dividends declared per share
    
    $
    0.030
    
    
    
    0.030
    
    
    
    
    
    
    
    Return on average assets
    
    
    1.09
    %
    
    
    1.18
    %
    
    
    (9
    )*
    
    
    (7.63
    )%Return on average equity
    
    
    13.43
    
    
    
    15.36
    
    
    
    (193
    )
    
    
    (12.57
    )Efficiency ratio (1)
    
    
    50.88
    
    
    
    53.66
    
    
    
    (278
    )
    
    
    (5.18
    )Noninterest expense to average assets
    
    
    1.77
    
    
    
    2.15
    
    
    
    (38
    )
    
    
    (17.67
    )Average equity to average assets
    
    
    8.11
    
    
    
    7.68
    
    
    
    43
    
    
    
    5.60Dividend payout ratio (2)
    
    
    11.54
    
    
    
    12.50
    
    
    
    (96
    )
    
    
    (7.68
    )Net loan charge-offs to average loans held in portfolio
    
    
    0.10
    
    
    
    0.18
    
    
    
    (8
    )
    
    
    (44.44
    )Interest rate spread (3)
    
    
    2.79
    
    
    
    3.14
    
    
    
    (35
    )
    
    
    (11.15
    )Net interest margin (3)
    
    
    3.26
    
    
    
    3.54
    
    
    
    (28
    )
    
    
    (7.91
    )
 March 31,
    
    December 31,
    
    Increase (Decrease)2007
    
    2006
    
    Amount
    
    %Financial Condition and Other Data:Loans held in portfolio, net
    
    $
    6,880,039
    
    
    $
    6,573,645
    
    
    $
    306,394
    
    
    
    4.66
    %Securities purchased under agreements to resell
    
    
    150,000
    
    
    
    175,000
    
    
    
    (25,000
    )
    
    
    (14.29
    )Securities available for sale
    
    
    1,791,076
    
    
    
    2,149,456
    
    
    
    (358,380
    )
    
    
    (16.67
    )Securities held to maturity
    
    
    288,451
    
    
    
    290,673
    
    
    
    (2,222
    )
    
    
    (0.76
    )Total assets
    
    
    10,306,383
    
    
    
    10,346,414
    
    
    
    (40,031
    )
    
    
    (0.39
    )Deposits
    
    
    7,299,168
    
    
    
    7,202,845
    
    
    
    96,323
    
    
    
    1.34Securities sold under agreements to repurchase
    
    
    300,000
    
    
    
    401,600
    
    
    
    (101,600
    )
    
    
    (25.30
    )Subordinated debentures
    
    
    240,549
    
    
    
    240,549
    
    
    
    
    
    
    
    Short-term borrowings
    
    
    441,879
    
    
    
    654,636
    
    
    
    (212,757
    )
    
    
    (35.50
    )Long-term borrowings
    
    
    1,079,747
    
    
    
    906,651
    
    
    
    173,096
    
    
    
    19.09Total liabilities
    
    
    9,484,882
    
    
    
    9,560,343
    
    
    
    (75,461
    )
    
    
    (0.79
    )Stockholders equity (4)
    
    
    821,501
    
    
    
    786,071
    
    
    
    35,430
    
    
    
    4.51Nonperforming assets
    
    
    24,657
    
    
    
    15,198
    
    
    
    9,459
    
    
    
    62.24Ratio of stockholders equity to total assets
    
    
    7.97
    %
    
    
    7.60
    %
    
    
    37
    *
    
    
    4.87Asset Quality Data:Loan delinquency ratio
    
    
    0.93
    %
    
    
    0.84
    %
    
    
    9
    *
    
    
    10.71
    %Nonperforming assets to total assets
    
    
    0.24
    
    
    
    0.15
    
    
    
    9
    
    
    
    60.00Nonperforming loans to loans held in portfolio
    
    
    0.31
    
    
    
    0.19
    
    
    
    12
    
    
    
    63.16Allowance for loan losses to loans held in portfolio
    
    
    0.91
    
    
    
    0.93
    
    
    
    (3
    )
    
    
    (3.23
    )Allowance for loan losses to nonperforming loans
    
    
    288.48
    
    
    
    503.73
    
    
    
    (21,525
    )
    
    
    (42.73
    )Total loan to deposit ratio
    
    
    96.70
    
    
    
    94.11
    
    
    
    259
    
    
    
    2.72
 -21-




---



##### 



Three Months Ended March 31,Increase (Decrease)2007
    
    2006
    

Amount
    
    %Bank Regulatory Capital Ratios:United Commercial Bank and subsidiaries:Tier 1 risk-based capital
    
    
    9.66
    %
    
    
    9.67
    %
    
    
    (1
    )*
    
    
    (0.10
    )%Total risk-based capital
    
    
    10.49
    
    
    
    10.53
    
    
    
    (4
    )
    
    
    (0.38
    )Tier 1 leverage
    
    
    8.21
    
    
    
    9.30
    
    
    
    (109
    )
    
    
    (11.72
    )UCBH Holdings, Inc. and subsidiaries:Tier 1 risk-based capital
    
    
    10.03
    
    
    
    9.86
    
    
    
    17
    
    
    
    1.72Total risk-based capital
    
    
    10.86
    
    
    
    10.72
    
    
    
    13
    
    
    
    1.21Tier 1 leverage ratio
    
    
    8.50
    
    
    
    9.50
    
    
    
    (100
    )
    
    
    (10.53
    )
 
 (1)
    
    Represents noninterest expense divided by the total of our net interest income
before provision for loan losses and our noninterest income.(2)
    
    Dividends declared per share as a percentage of diluted earnings per share.(3)
    
    Calculated on a tax equivalent basis. Interest income from tax-exempt investment
securities calculated on a tax equivalent basis was $2.1 million and $1.4 million for the
three months ended March 31, 2007 and 2006, respectively.(4)
    
    In conjunction with the acquisition of Summit Bank Corporation on December 29, 2006,
UCBH issued 4.8 million shares of common stock.*
    
    Basis point Three Months Ended March 31, 2007, Compared to Three Months Ended March 31, 2006
  -22-




---



##### 



Net Interest Income and Net Interest Margin
 2007
    
    
    2006Average
    
    
    
    
    
    
    
    
    
    
    AverageInterest
    
    
    Yields
    
    
    
    
    
    
    Interest
    
    
    YieldsAverage
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/Balance
    
    
    Expense
    
    
    Rates Paid
    
    
    Balance
    
    
    Expense
    
    
    Rates PaidNontaxable equivalent basis:Interest-earning assetsLoans (1)(2)
    
    $
    6,839,200
    
    
    $
    131,652
    
    
    
    7.70
    %
    
    $
    6,037,540
    
    
    $
    105,538
    
    
    
    6.99
    %Taxable securities (3)
    
    
    1,857,226
    
    
    
    23,514
    
    
    
    5.06
    
    
    
    1,179,163
    
    
    
    13,757
    
    
    
    4.67Tax exempt securities (3)
    
    
    274,676
    
    
    
    3,306
    
    
    
    4.81
    
    
    
    225,580
    
    
    
    2,692
    
    
    
    4.77FHLB Stock
    
    
    68,805
    
    
    
    922
    
    
    
    5.36
    
    
    
    44,474
    
    
    
    450
    
    
    
    4.05Securities purchased under agreements to resell
    
    
    125,278
    
    
    
    2,264
    
    
    
    7.23
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    154,056
    
    
    
    2,289
    
    
    
    5.94
    
    
    
    96,818
    
    
    
    1,015
    
    
    
    4.19Total interest-earning assets
    
    
    9,319,241
    
    
    
    163,947
    
    
    
    7.04
    
    
    
    7,583,575
    
    
    
    123,452
    
    
    
    6.51Noninterest-earning assets
    
    
    600,442
    
    
    
    
    
    
    
    
    
    
    
    358,413
    
    
    
    Total assets
    
    $
    9,919,683
    
    
    $
    163,947
    
    
    
    
    
    
    $
    7,941,988
    
    
    $
    123,452Interest-bearing liabilities:Deposits:NOW, checking and money market accounts
    
    $
    1,478,541
    
    
    $
    12,477
    
    
    
    3.38
    
    
    $
    1,212,276
    
    
    $
    7,774
    
    
    
    2.57Savings accounts
    
    
    692,003
    
    
    
    1,726
    
    
    
    1.00
    
    
    
    779,183
    
    
    
    2,278
    
    
    
    1.17Time deposits
    
    
    4,230,874
    
    
    
    51,791
    
    
    
    4.90
    
    
    
    3,622,005
    
    
    
    34,344
    
    
    
    3.79Total interest-bearing deposits
    
    
    6,401,418
    
    
    
    65,994
    
    
    
    4.12
    
    
    
    5,613,464
    
    
    
    44,396
    
    
    
    3.16Securities sold under agreements to repurchase
    
    
    318,956
    
    
    
    3,261
    
    
    
    4.09
    
    
    
    2,778
    
    
    
    29
    
    
    
    4.18Short-term borrowings and federal funds purchased
    
    
    401,428
    
    
    
    5,192
    
    
    
    5.17
    
    
    
    360,357
    
    
    
    3,445
    
    
    
    3.82Long-term borrowings
    
    
    943,810
    
    
    
    11,116
    
    
    
    4.71
    
    
    
    580,093
    
    
    
    7,287
    
    
    
    5.02Subordinated debentures
    
    
    240,549
    
    
    
    4,553
    
    
    
    7.57
    
    
    
    146,050
    
    
    
    2,715
    
    
    
    7.44Total interest-bearing liabilities
    
    
    8,306163
    
    
    
    90,116
    
    
    
    4.34
    
    
    
    6,702,742
    
    
    
    57,872
    
    
    
    3.45Noninterest-bearing deposits
    
    
    695,668
    
    
    
    
    
    
    
    
    
    
    
    511,445
    
    
    
    Other noninterest-bearing liabilities
    
    
    113,038
    
    
    
    
    
    
    
    
    
    
    
    117,871
    
    
    
    Stockholders equity
    
    
    804,814
    
    
    
    
    
    
    
    
    
    
    
    609,930
    
    
    
    Total liabilities and stockholders equity
    
    $
    9,919,683
    
    
    $
    90,116
    
    
    
    
    
    
    $
    7,941,988
    
    
    $
    57,872Net interest-earning assets/net interest
income/net interest rate spread (4)
    
    $
    1,013,078
    
    
    $
    73,831
    
    
    
    2.70
    %
    
    $
    880,833
    
    
    $
    65,580
    
    
    
    3.06
    %Net interest margin (5)
    
    
    
    
    
    
    
    
    
    
    3.17
    %
    
    
    
    
    
    
    
    
    
    
    3.46
    %Ratio of interest-earning assets to
interest-bearing liabilities
    
    
    1.12
    x
    
    
    
    
    
    
    
    
    
    
    1.13
    xTax equivalent basis:Total interest-earning assets (6)
    
    $
    9,319,241
    
    
    
    166,033
    
    
    
    7.13
    %
    
    $
    7,583,575
    
    
    
    124,902
    
    
    
    6.59
    %Total interest-bearing liabilities
    
    
    8,306,163
    
    
    
    90,116
    
    
    
    4.34
    
    
    
    6,702,742
    
    
    
    57,872
    
    
    
    3.45Net interest-earning assets/net interest
income/net interest rate spread (4)
    
    $
    1,013,078
    
    
    $
    75,917
    
    
    
    2.79
    %
    
    $
    880,833
    
    
    $
    67,030
    
    
    
    3.14
    %Net interest margin (5)
    
    
    
    
    
    
    
    
    
    
    3.26
    %
    
    
    
    
    
    
    
    
    
    
    3.54
    %Average cost of deposits:Total interest-bearing deposits
    
    $
    6,401,418
    
    
    $
    65,994
    
    
    
    4.12
    %
    
    $
    5,613,464
    
    
    $
    44,396
    
    
    
    3.16
    %Noninterest-bearing deposits
    
    
    695,668
    
    
    
    
    
    
    
    
    
    
    
    511,445
    
    
    
    Total deposits
    
    $
    7,097,086
    
    
    $
    65,994
    
    
    
    3.72
    %
    
    $
    6,124,909
    
    
    $
    44,396
    
    
    
    2.90
    %
 -23-




---



##### 



(1)
    
    Nonaccrual loans are included in the table for computation purposes; however,
interest for such loans is recognized on a cash basis.(2)
    
    Average loans include loans held for sale.(3)
    
    Average yield on investment securities is computed using historical cost balances;
the yield information does not give effect to changes in fair value that are reflected as a
component of stockholders equity.(4)
    
    Interest rate spread represents the difference between the average yield on
interest-earning assets and the average cost of interest-bearing liabilities.(5)
    
    Net interest margin represents net interest income divided by average
interest-earning assets.(6)
    
    Interest income from nontaxable securities has been adjusted to a tax equivalent
basis using a statutory Federal income tax rate of 35.0%. Interest income from nontaxable
investment securities calculated on a tax equivalent basis was $2.1 million and $1.4 million
for the three months ended March 31, 2007 and 2006, respectively.   Provision for Loan Losses
 Noninterest Income
 Noninterest Expense
 Income Tax Expense
 -24-




---



##### 



BALANCE SHEET ANALYSIS
 Investment Securities
  Gross
    
    
    Gross
    
    
    
    
    
    
    Less Than 12 Months
    
    
    12 Months or More
    
    
    TotalAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Market
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedDescription
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    Value
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesInvestment securities
available for sale:Collateralized debt
obligations
    
    $
    38,445
    
    
    $
    
    
    
    $
    (410
    )
    
    $
    38,035
    
    
    $
    29,731
    
    
    $
    (214
    )
    
    $
    8,304
    
    
    $
    (196
    )
    
    $
    38,035
    
    
    $
    (410
    )U.S. Government
sponsored
enterprises notes
    
    
    583,766
    
    
    
    146
    
    
    
    (3,809
    )
    
    
    580,103
    
    
    
    437,501
    
    
    
    (544
    )
    
    
    118,614
    
    
    
    (3,265
    )
    
    
    556,115
    
    
    
    (3,809
    )U.S. Government
sponsored
enterprises
discount notes
    
    
    161,865
    
    
    
    17
    
    
    
    
    
    
    
    161,882
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Municipals
    
    
    52,179
    
    
    
    119
    
    
    
    (213
    )
    
    
    52,085
    
    
    
    31,678
    
    
    
    (213
    )
    
    
    
    
    
    
    
    
    
    
    31,678
    
    
    
    (213
    )Other
    
    
    10,000
    
    
    
    
    
    
    
    (175
    )
    
    
    9,825
    
    
    
    9,825
    
    
    
    (175
    )
    
    
    
    
    
    
    
    
    
    
    9,825
    
    
    
    (175
    )Total investment
securities available
for sale
    
    
    846,255
    
    
    
    282
    
    
    
    (4,607
    )
    
    
    841,930
    
    
    
    508,735
    
    
    
    (1,146
    )
    
    
    126,918
    
    
    
    (3,461
    )
    
    
    635,653
    
    
    
    (4,607
    )Mortgage-backed
securities available
for sale:FNMA
    
    
    422,447
    
    
    
    8
    
    
    
    (11,267
    )
    
    
    411,188
    
    
    
    133,484
    
    
    
    (2,512
    )
    
    
    277,058
    
    
    
    (8,755
    )
    
    
    410,542
    
    
    
    (11,267
    )GNMA
    
    
    81,233
    
    
    
    6
    
    
    
    (2,656
    )
    
    
    78,583
    
    
    
    
    
    
    
    
    
    
    
    78,098
    
    
    
    (2,656
    )
    
    
    78,098
    
    
    
    (2,656
    )FHLMC
    
    
    263,171
    
    
    
    
    
    
    
    (8,215
    )
    
    
    254,956
    
    
    
    4,844
    
    
    
    (3
    )
    
    
    250,107
    
    
    
    (8,212
    )
    
    
    254,951
    
    
    
    (8,215
    )Other
    
    
    207,591
    
    
    
    264
    
    
    
    (3,436
    )
    
    
    204,419
    
    
    
    24,899
    
    
    
    (71
    )
    
    
    166,347
    
    
    
    (3,365
    )
    
    
    191,246
    
    
    
    (3,436
    )Total mortgage-backed
securities available
for sale
    
    
    974,442
    
    
    
    278
    
    
    
    (25,574
    )
    
    
    949,146
    
    
    
    163,227
    
    
    
    (2,586
    )
    
    
    771,610
    
    
    
    (22,988
    )
    
    
    934,837
    
    
    
    (25,574
    )Total investment and
mortgage-backed
securities available
for sale
    
    
    1,820,697
    
    
    
    560
    
    
    
    (30,181
    )
    
    
    1,791,076
    
    
    
    671,962
    
    
    
    (3,732
    )
    
    
    898,528
    
    
    
    (26,449
    )
    
    
    1,570,490
    
    
    
    (30,181
    )Investment securities
held to maturity:Municipal securities
    
    
    222,662
    
    
    
    6,276
    
    
    
    (32
    )
    
    
    228,906
    
    
    
    3,662
    
    
    
    (26
    )
    
    
    416
    
    
    
    (6
    )
    
    
    4,078
    
    
    
    (32
    )Mortgage-backed
securities held to
maturity:FNMA
    
    
    4,326
    
    
    
    
    
    
    
    (158
    )
    
    
    4,168
    
    
    
    
    
    
    
    
    
    
    
    4,168
    
    
    
    (159
    )
    
    
    4,168
    
    
    
    (159
    )GNMA
    
    
    60,925
    
    
    
    
    
    
    
    (1,641
    )
    
    
    59,284
    
    
    
    
    
    
    
    
    
    
    
    59,284
    
    
    
    (1,641
    )
    
    
    59,284
    
    
    
    (1,641
    )FHLMC
    
    
    538
    
    
    
    
    
    
    
    (19
    )
    
    
    519
    
    
    
    
    
    
    
    
    
    
    
    519
    
    
    
    (19
    )
    
    
    519
    
    
    
    (19
    )Total mortgage-backed
securities held to
maturity
    
    
    65,789
    
    
    
    
    
    
    
    (1,818
    )
    
    
    63,971
    
    
    
    
    
    
    
    
    
    
    
    63,971
    
    
    
    (1,819
    )
    
    
    63,971
    
    
    
    (1,819
    )Total investment and
mortgage-backed
securities held to
maturity
    
    
    288,451
    
    
    
    6,276
    
    
    
    (1,850
    )
    
    
    292,877
    
    
    
    3,662
    
    
    
    (26
    )
    
    
    64,387
    
    
    
    (1,825
    )
    
    
    68,049
    
    
    
    (1,851
    )Total securities
    
    $
    2,109,148
    
    
    $
    6,836
    
    
    $
    (32,031
    )
    
    $
    2,083,953
    
    
    $
    675,624
    
    
    $
    (3,758
    )
    
    $
    962,915
    
    
    $
    (28,274
    )
    
    $
    1,638,539
    
    
    $
    (32,032
    )
   -25-




---



##### 



Gross
    
    
    Gross
    
    
    
    
    
    
    Less Than 12 Months
    
    
    12 Months or More
    
    
    TotalAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Market
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedDescription
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    Value
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesInvestment securities
available for sale:Collateralized debt
obligations
    
    $
    38,445
    
    
    $
    5
    
    
    $
    (316
    )
    
    $
    38,134
    
    
    $
    14,888
    
    
    $
    (113
    )
    
    $
    8,296
    
    
    $
    (203
    )
    
    $
    23,184
    
    
    $
    (316
    )U.S. Government
sponsored
enterprises notes
    
    
    588,621
    
    
    
    120
    
    
    
    (5,701
    )
    
    
    583,040
    
    
    
    263,885
    
    
    
    (1,566
    )
    
    
    125,194
    
    
    
    (4,135
    )
    
    
    389,079
    
    
    
    (5,701
    )U.S. Government
sponsored
enterprises
discount notes
    
    
    249,024
    
    
    
    61
    
    
    
    
    
    
    
    249,085
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    U.S. Treasury Bills.
    
    
    73,183
    
    
    
    17
    
    
    
    
    
    
    
    73,200
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Municipals
    
    
    58,325
    
    
    
    
    
    
    
    
    
    
    
    58,325
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Commercial paper
    
    
    49,952
    
    
    
    
    
    
    
    
    
    
    
    49,952
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    10,000
    
    
    
    
    
    
    
    (125
    )
    
    
    9,875
    
    
    
    9,875
    
    
    
    (125
    )
    
    
    
    
    
    
    
    
    
    
    9,875
    
    
    
    (125
    )Total investment
securities available
for sale
    
    
    1,067,550
    
    
    
    203
    
    
    
    (6,142
    )
    
    
    1,061,611
    
    
    
    288,648
    
    
    
    (1,804
    )
    
    
    133,490
    
    
    
    (4,338
    )
    
    
    422,138
    
    
    
    (6,142
    )Mortgage-backed
securities available
for sale:FNMA
    
    
    515,711
    
    
    
    391
    
    
    
    (13,405
    )
    
    
    502,697
    
    
    
    148,236
    
    
    
    (3,025
    )
    
    
    284,506
    
    
    
    (10,380
    )
    
    
    432,742
    
    
    
    (13,405
    )GNMA
    
    
    87,866
    
    
    
    
    
    
    
    (3,261
    )
    
    
    84,605
    
    
    
    
    
    
    
    
    
    
    
    78,742
    
    
    
    (3,261
    )
    
    
    78,742
    
    
    
    (3,261
    )FHLMC
    
    
    313,991
    
    
    
    140
    
    
    
    (9,847
    )
    
    
    304,284
    
    
    
    7,424
    
    
    
    (32
    )
    
    
    255,779
    
    
    
    (9,815
    )
    
    
    263,203
    
    
    
    (9,847
    )Other
    
    
    200,832
    
    
    
    16
    
    
    
    (4,589
    )
    
    
    196,259
    
    
    
    
    
    
    
    
    
    
    
    171,423
    
    
    
    (4,589
    )
    
    
    171,423
    
    
    
    (4,589
    )Total mortgage-backed
securities available
for sale
    
    
    1,118,400
    
    
    
    547
    
    
    
    (31,102
    )
    
    
    1,087,845
    
    
    
    155,660
    
    
    
    (3,057
    )
    
    
    790,450
    
    
    
    (28,045
    )
    
    
    946,110
    
    
    
    (31,102
    )Total investment and
mortgage-backed
securities available
for sale
    
    
    2,185,950
    
    
    
    750
    
    
    
    (37,244
    )
    
    
    2,149,456
    
    
    
    444,308
    
    
    
    (4,861
    )
    
    
    923,940
    
    
    
    (32,383
    )
    
    
    1,368,248
    
    
    
    (37,244
    )Investment securities
held to maturity:Municipal securities
    
    
    222,638
    
    
    
    6,750
    
    
    
    (30
    )
    
    
    229,358
    
    
    
    4,531
    
    
    
    (24
    )
    
    
    416
    
    
    
    (6
    )
    
    
    4,947
    
    
    
    (30
    )Mortgage-backed
securities held to
maturity:FNMA
    
    
    4,372
    
    
    
    
    
    
    
    (172
    )
    
    
    4,200
    
    
    
    
    
    
    
    
    
    
    
    4,200
    
    
    
    (172
    )
    
    
    4,200
    
    
    
    (172
    )GNMA
    
    
    63,122
    
    
    
    
    
    
    
    (1,755
    )
    
    
    61,367
    
    
    
    
    
    
    
    
    
    
    
    61,367
    
    
    
    (1,755
    )
    
    
    61,367
    
    
    
    (1,755
    )FHLMC
    
    
    541
    
    
    
    
    
    
    
    (20
    )
    
    
    521
    
    
    
    
    
    
    
    
    
    
    
    521
    
    
    
    (20
    )
    
    
    521
    
    
    
    (20
    )Total mortgage-backed
securities held to
maturity
    
    
    68,035
    
    
    
    
    
    
    
    (1,947
    )
    
    
    66,088
    
    
    
    
    
    
    
    
    
    
    
    66,088
    
    
    
    (1,947
    )
    
    
    66,088
    
    
    
    (1,947
    )Total investment and
mortgage-backed
securities held to
maturity
    
    
    290,673
    
    
    
    6,750
    
    
    
    (1,977
    )
    
    
    295,446
    
    
    
    4,531
    
    
    
    (24
    )
    
    
    66,504
    
    
    
    (1,953
    )
    
    
    71,035
    
    
    
    (1,977
    )Total securities
    
    $
    2,476,623
    
    
    $
    7,500
    
    
    $
    (39,221
    )
    
    $
    2,444,902
    
    
    $
    448,839
    
    
    $
    (4,885
    )
    
    $
    990,444
    
    
    $
    (34,336
    )
    
    $
    1,439,283
    
    
    $
    (39,221
    )
 Loans
  March 31,
    
    
    December 31,2007
    
    
    2006Commercial:Secured by real estate  nonresidential
    
    $
    2,479,457
    
    
    $
    2,341,572Secured by real estate  multifamily
    
    
    1,313,606
    
    
    
    1,275,594Construction
    
    
    1,154,176
    
    
    
    1,054,302Business
    
    
    1,488,723
    
    
    
    1,461,322Total commercial
    
    
    6,435,962
    
    
    
    6,132,790Consumer:Residential mortgage (one-to-four family)
    
    
    455,328
    
    
    
    448,895Other
    
    
    51,553
    
    
    
    53,975Total consumer
    
    
    506,881
    
    
    
    502,870Loans held in portfolio (1)
    
    
    6,942,843
    
    
    
    6,635,660Allowance for loan losses
    
    
    (62,804
    )
    
    
    (62,015
    )Loans held in portfolio, net
    
    $
    6,880,039
    
    
    $
    6,573,645
 
 (1)
    
    Amounts reflect net unamortized deferred loan fees, purchase premiums discounts
of $21.0 million and $25.8 million at March 31, 2007, and December 31, 2006, respectively.  -26-




---



##### 



March 31,
    
    
    December 31,2007
    
    
    2006Commercial:Secured by real estate  nonresidential
    
    $
    113,172
    
    
    $
    141,348Business
    
    
    1,181
    
    
    
    1,203Total commercial
    
    
    114,353
    
    
    
    142,551Consumer:Residential mortgage (one-to-four family)
    
    
    1,195
    
    
    
    310Loans held for sale (1)
    
    $
    115,548
    
    
    $
    142,861
 
 (1)
    
    Amounts reflect net unamortized deferred loan fees of $198,000 and $213,000 at
March 31, 2007, and December 31, 2006, respectively.   March 31,
    
    
    March 31,2007
    
    
    2006Loans held for sale:Commercial:Secured by real estate  nonresidential
    
    $
    16,331
    
    
    $
    22,325Secured by real estate  multifamily
    
    
    
    
    
    
    Total commercial loans
    
    
    16,331
    
    
    
    22,325Consumer:Residential mortgage (one-to-four family)
    
    
    1,190
    
    
    
    Total loans held for sale commitments (1)
    
    
    17,521
    
    
    
    22,325Loans held in portfolio:Commercial:Secured by real estate  nonresidential
    
    
    270,118
    
    
    
    185,081Secured by real estate  multifamily
    
    
    117,913
    
    
    
    85,122Construction
    
    
    284,657
    
    
    
    178,891Business
    
    
    288,678
    
    
    
    230,519Total commercial loans
    
    
    961,366
    
    
    
    679,613Consumer:Residential mortgage (one-to-four family)
    
    
    30,701
    
    
    
    18,865Other
    
    
    6,513
    
    
    
    7,256Total consumer loans
    
    
    37,214
    
    
    
    26,121Total loans held in portfolio commitments (1)
    
    
    998,580
    
    
    
    705,734Total loan commitments (1)
    
    $
    1,016,101
    
    
    $
    728,059
 
 (1)
    
    Amounts do not reflect commitments related to loan participations.  -27-




---



##### 



IntermediateAdjustable
    
    
    Fixed
    
    
    Fixed
    
    
    TotalCommercial:Secured by real estate  nonresidential
    
    $
    965,732
    
    
    $
    436,070
    
    
    $
    1,095,128
    
    
    $
    2,496,930Secured by real estate  multifamily
    
    
    367,426
    
    
    
    818,972
    
    
    
    124,297
    
    
    
    1,310,695Construction
    
    
    1,060,553
    
    
    
    
    
    
    
    99,648
    
    
    
    1,160,201Business
    
    
    1,361,654
    
    
    
    2,297
    
    
    
    124,995
    
    
    
    1,488,946Total commercial
    
    
    3,755,365
    
    
    
    1,257,339
    
    
    
    1,444,068
    
    
    
    6,456,772Consumer:Residential mortgage (one-to-four family)
    
    
    70,733
    
    
    
    210,593
    
    
    
    174,166
    
    
    
    455,492Other
    
    
    48,681
    
    
    
    
    
    
    
    2,871
    
    
    
    51,552Total consumer
    
    
    119,414
    
    
    
    210,593
    
    
    
    177,037
    
    
    
    507,044Gross loans held in portfolio (1)
    
    $
    3,874,779
    
    
    $
    1,467,932
    
    
    $
    1,621,105
    
    
    $
    6,963,816
 
 (1)
    
    Amounts do not reflect net deferred loan fees, purchase premiums and
discounts of $21.0 million at March 31, 2007.  Deposits
  March 31, 2007
    
    
    December 31, 2006Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    AverageAmount
    
    
    Rate
    
    
    Amount
    
    
    RateNOW, checking and money market accounts
    
    $
    2,268,672
    
    
    
    2.16
    %
    
    $
    2,194,176
    
    
    
    2.18
    %Savings accounts
    
    
    940,719
    
    
    
    2.09
    
    
    
    942,672
    
    
    
    2.14Time deposits:Less than $100,000
    
    
    1,262,422
    
    
    
    4.36
    
    
    
    1,410,162
    
    
    
    4.60$100,000 or greater
    
    
    2,827,355
    
    
    
    4.69
    
    
    
    2,655,835
    
    
    
    4.91Total time deposits
    
    
    4,089,777
    
    
    
    4.89
    
    
    
    4,065,997
    
    
    
    4.80Total deposits
    
    $
    7,299,168
    
    
    
    3.68
    %
    
    $
    7,202,845
    
    
    
    3.66
    %
   -28-




---



##### 



Borrowings
  March 31,
    
    December 31,2007
    
    2006Securities sold under agreements to repurchase:Average balance outstanding
    
    $
    318,956
    
    
    $
    162,124Maximum amount outstanding at any month end period
    
    
    312,215
    
    
    
    401,600Balance outstanding at end of period
    
    
    300,000
    
    
    
    401,600Weighted average interest rate during the period
    
    
    4.09
    %
    
    
    3.56
    %Weighted average interest rate at end of period
    
    
    4.43
    %
    
    
    3.71
    %Weighted average remaining term to maturity at end of period (in years)
    
    
    7.9
    
    
    
    6.1Short-term borrowings:FHLB advances and other short-term borrowings:Average balance outstanding
    
    $
    401,428
    
    
    $
    224,234Maximum amount outstanding at any month end period
    
    
    637,787
    
    
    
    654,636Balance outstanding at end of period
    
    
    441,879
    
    
    
    654,636Weighted average interest rate during the period
    
    
    5.16
    %
    
    
    4.52
    %Weighted average interest rate at end of period
    
    
    5.29
    %
    
    
    5.21
    %Weighted average remaining term to maturity at end of period (in years)
    
    
    
    
    
    
    Long-term borrowings:FHLB advances:Average balance outstanding
    
    $
    943,810
    
    
    $
    683,978Maximum amount outstanding at any month end period
    
    
    1,079,747
    
    
    
    906,651Balance outstanding at end of period
    
    
    1,079,747
    
    
    
    906,651Weighted average interest rate during the period
    
    
    4.71
    %
    
    
    4.89
    %Weighted average interest rate at end of period
    
    
    4.65
    %
    
    
    4.72
    %Weighted average remaining term to maturity at end of period (in years)
    
    
    6.0
    
    
    
    5.4
  Subordinated Debentures
  -29-




---



##### 



RISK ELEMENTS
   
    
    Enterprise Risk Management Committee, which reviews credit, operational, market and liquidity risk;
 
    
    Credit Risk Management Committee, which reviews credit policies, products and problem assets risk;
 
    
    Market Risk Management Committee, which reviews securities, loans and borrowings to assess yield, and interest rate and
market risk; and
 
    
    Operational Risk Management Committee, which reviews those risks not covered by the Credit Risk Management and Market
Risk Management Committees.
  Credit Risk Management
    -30-




---



##### 



March 31, 2007
    
    
    December 31, 2006Amount
    
    
    %
    
    
    Amount
    
    
    %Commercial:Secured by real estate  nonresidential
    
    $
    2,479,457
    
    
    
    35.71
    
    
    $
    2,341,572
    
    
    
    35.29Secured by real estate  multifamily
    
    
    1,313,606
    
    
    
    18.92
    
    
    
    1,275,594
    
    
    
    19.22Construction
    
    
    1,154,176
    
    
    
    16.62
    
    
    
    1,054,302
    
    
    
    15.89Business
    
    
    1,488,723
    
    
    
    21.44
    
    
    
    1,461,322
    
    
    
    22.02Total commercial
    
    
    6,435,962
    
    
    
    92.69
    
    
    
    6,132,790
    
    
    
    92.42Consumer:Residential mortgage (one-to-four family)
    
    
    455,328
    
    
    
    6.56
    
    
    
    448,895
    
    
    
    6.76Other
    
    
    51,553
    
    
    
    0.75
    
    
    
    53,975
    
    
    
    0.82Total consumer
    
    
    506,881
    
    
    
    7.31
    
    
    
    502,870
    
    
    
    7.58Loans held in portfolio (1)
    
    $
    6,942,843
    
    
    
    100.00
    
    
    $
    6,635,660
    
    
    
    100.00
 
 (1)
    
    Amounts reflect net unamortized deferred loan fees, purchase premiums
and discounts of $21.0 million and $25.8 million at March 31, 2007, and December 31, 2006,
respectively.   Nonperforming Assets
  -31-




---



##### 



March 31,
    
    
    December 31,2007
    
    
    2006Commercial loans:Secured by real estate  nonresidential
    
    $
    5,549
    
    
    $
    5,604Secured by real estate  multifamily
    
    
    914
    
    
    
    Construction
    
    
    9,221
    
    
    
    Business
    
    
    5,723
    
    
    
    6,339Total commercial loans
    
    
    21,407
    
    
    
    11,943Consumer loans:Residential mortgage (one-to-four family)
    
    
    363
    
    
    
    368Other
    
    
    
    
    
    
    Total consumer loans
    
    
    363
    
    
    
    368Total nonaccrual loans from loans held in portfolio
    
    
    21,770
    
    
    
    12,311Other real estate owned
    
    
    2,887
    
    
    
    2,887Total nonperforming assets
    
    $
    24,657
    
    
    $
    15,198Nonperforming assets to total assets
    
    
    0.24
    %
    
    
    0.15
    %Nonaccrual loans to loans held in portfolio
    
    
    0.31
    
    
    
    0.19Nonperforming assets to loans held in portfolio and other real estate owned
    
    
    0.36
    
    
    
    0.23Loans held in portfolio
    
    $
    6,942,843
    
    
    $
    6,635,660Gross interest income recognized on impaired loans
    
    
49
    
    
    
    80Gross interest income not recognized on nonaccrual loans
    
    
    948
    
    
    
    955Accruing loans contractually past due 90 days or more
    
    
    16,476
    
    
    
    4,339Loans classified as troubled debt restructurings and not included above
    
    
    8,571
    
    
    
    8,614
     -32-




---



##### 



Allowances for Credit Losses
 Allowance for Loan Losses
      -33-




---



##### 



2007
    
    
    2006Balance at
beginning of period:Allowance for loan losses
    
    $
    62,015
    
    
    $
    64,542Allowance for losses  unfunded commitments
    
    
    6,833
    
    
    
    3,402Total allowance for losses at beginning of year
    
    
    68,848
    
    
    
    67,944Provision for loan losses
    
    
    1,048
    
    
    
    307Charge-offs:Commercial:Secured by real estate  nonresidential
    
    
    
    
    
    
    452Business
    
    
    1,772
    
    
    
    2,351Total commercial
    
    
    1,772
    
    
    
    2,803Consumer:Other
    
    
    
    
    
    
    50Total charge-offs
    
    
    1,772
    
    
    
    2,853Recoveries:Commercial:Secured by real estate  nonresidential
    
    
    2
    
    
    
    81Business
    
    
    12
    
    
    
    30Total commercial
    
    
    14
    
    
    
    111Consumer:Residential mortgage (one-to-four family)
    
    
    
    
    
    
    Other
    
    
    2
    
    
    
    10Total consumer
    
    
    2
    
    
    
    10Total recoveries
    
    
    16
    
    
    
    121Net recoveries (charge-offs)
    
    
    (1,756
    )
    
    
    (2,732
    )Total
allowance for losses at end of period
    
    $
    68,140
    
    
    $
    65,519Allowance for loan losses
    
    $
    62,804
    
    
    $
    61,806Allowance for losses  unfunded commitments
    
    
    5,336
    
    
    
    3,713Total allowance for losses at end of year
    
    $
    68,140
    
    
    $
    65,519Allowance for loan losses to loans held in portfolio
    
    
    0.91
    %
    
    
    1.08
    %Net charge-offs to average loans held in portfolio
    
    
    0.10
    
    
    
    0.18
    Allowance for Unfunded Commitments
 -34-




---



##### 



Market Risk Management
      -35-




---



##### 



Operational Risk Management
    Liquidity Risk
 Liquidity Management
     -36-




---



##### 



CAPITAL MANAGEMENT
    -37-




---



##### 



March 31,
    
    
    December 31,2007
    
    
    2006United Commercial Bank:Tier 1 leverage
    
    
    8.21
    %
    
    
    9.30
    %Tier 1 risk-based capital
    
    
    9.65
    
    
    
    9.67Total risk-based capital
    
    
    10.48
    
    
    
    10.53UCBH Holdings, Inc. and subsidiaries:Tier 1 leverage
    
    
    8.5
    %
    
    
    9.50
    %Tier 1 risk-based capital
    
    
    10.03
    
    
    
    9.86Total risk-based capital
    
    
    10.86
    
    
    
    10.72
   -38-




---



##### 



Item 3. Quantitative and Qualitative Disclosures About Market Risk
  Item 4. Controls and Procedures
  -39-




---



##### 



PART II  OTHER INFORMATION
 Item 1. Legal Proceedings
  Item 1A. Risk Factors
   Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  Item 3. Defaults Upon Senior Securities
  Item 4. Submission of Matters to a Vote of Security Holders
  Item 5. Other Information
  -40-




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##### 



Item 6. Exhibits
 Index to Exhibits
 Exhibit
    
    
    
    Incorporated by Reference
    
    FiledNumber
    
    Exhibit Description
    
    Form
    
    File No.
    
    Exhibit
    
    Filing Date
    
    Herewith2.1
    
    Agreement and Plan of Merger by and
among UCBH Holdings, Inc. (Buyer),
UCBH Merger Sub, Inc., a wholly owned
subsidiary of Buyer, and Pacifica
Bancorp, Inc. dated May 23, 2005
    
    10-Q
    
    000-24947
    
    
    2.1
    
    
    August 9, 20052.2
    
    Agreement and Plan of Merger by and
among UCBH Holdings, Inc. (Buyer),
United Commercial Bank, a wholly
owned subsidiary of Buyer, and Asian
American Bank & Trust Company dated
August 2, 2005
    
    10-Q
    
    000-24947
    
    
    2.2
    
    
    November 9, 20052.3
    
    Agreement and Plan of Merger by and
among UCBH Holdings, Inc. (Buyer),
United Commercial Bank, a wholly
owned subsidiary of Buyer, and Great
Eastern Bank dated October 13, 2005
    
    S-4
    
    000-24947
    
    
    2.1
    
    
    December 12, 20052.4
    
    Agreement and Plan of Merger by and
among UCBH Holdings, Inc. (Buyer),
UCB Merger, LLC, a wholly owned
subsidiary of Buyer, and Summit Bank
Corporation dated September 18, 2006
    
    10-Q
    
    000-24947
    
    
    2.4
    
    
    November 14, 20062.5
    
    Agreement and Plan of Merger by and
among UCBH Holdings, Inc. (Buyer),
UCB Merger II, LLC, a wholly owned
subsidiary of Buyer, CAB Holding, LLC, CAB International Holding
Limited, and Dr. Paul
Shi H. Huang dated January 10, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    ü2.6
    
    Sale and Purchase Agreement among
United Commercial Bank, Charoen Pokphand Group Co., Ltd., M. Thai Group
Limited and DEG  Deutsche Investitions and
Entwicklungsgesellschaft mbH dated March 26, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    ü2.7
    
    Agreement for Transfer of Equity
Interest in Business Development Bank Limited by and among
Kasikornbank Public Co., Ltd., Charoen Pokphand Group Company Limited,
and United Commercial Bank dated March 26, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    ü3.1
    
    Second Amended and Restated
Certificate of Incorporation of UCBH
Holdings, Inc.
    
    10-Q
    
    000-24947
    
    
    3.1
    
    
    May 10, 20043.2
    
    Amended and Restated Bylaws of UCBH
Holdings, Inc., as amended and
restated
    
    10-Q
    
    000-24947
    
    
    3.2
    
    
    May 10, 20043.3
    
    Certificate of Designation,
Preferences and Rights of Series A
Participating Preferred Stock (filed
as Exhibit A to Exhibit 4.7 hereto)
    
    8-K
    
    000-24947
    
    
    1
    
    
    January 29, 20034.0
    
    Form of Stock Certificate of UCBH
Holdings, Inc.
    
    S-1
    
    333-58325
    
    
    4.0
    
    
    July 1, 19984.1
    
    Indenture of UCBH Holdings, Inc.,
dated April 17, 1998, between UCBH
Holdings, Inc. and Wilmington Trust
Company, as trustee
    
    S-4
    
    333-58335
    
    
    4.1
    
    
    July 1, 19984.2
    
    Form of Certificate of Series B
Junior Subordinated Debenture
    
    S-4
    
    333-58335
    
    
    4.2
    
    
    July 1, 19984.3
    
    Certificate of Trust of UCBH Trust Co.
    
    S-4
    
    333-58335
    
    
    4.3
    
    
    July 1, 19984.4
    
    Amended and Restated Declaration of
Trust of UCBH Trust Co.
    
    S-4
    
    333-58335
    
    
    4.4
    
    
    July 1, 19984.5
    
    Form of Series B Capital Security
Certificate for UCBH Trust Co.
    
    S-4
    
    333-58335
    
    
    4.5
    
    
    July 1, 1998
 -41-




---



##### 



Exhibit
    
    
    
    Incorporated by Reference
    
    FiledNumber
    
    Exhibit Description
    
    Form
    
    File No.
    
    Exhibit
    
    Filing Date
    
    Herewith4.6
    
    Form of Series B Guarantee of the
Company relating to the Series B
Capital Securities
    
    S-4
    
    333-58335
    
    
    4.6
    
    
    July 1, 19984.7
    
    Rights Agreement dated as of January
28, 2003
    
    8-K
    
    000-24947
    
    
    1
    
    
    January 29, 20034.8
    
    Indenture of UCBH Holdings, Inc.,
dated September 22, 2005, between
UCBH Holdings, Inc. and Wilmington
Trust Company, as trustee
    
    10-Q
    
    000-24947
    
    
    2.2
    
    
    November 9, 20054.9
    
    Indenture between UCBH Holdings, Inc.
and Wilmington Trust Company, as
trustee, dated December 15, 2006
    
    10-K
    
    000-24947
    
    
    4.9
    
    
    March 1, 20074.10
    
    Junior subordinated indenture between
UCBH Holdings, Inc. and Wilmington
Trust Company, as trustee, dated
December 28, 2006
    
    10-K
    
    000-24947
    
    
    4.10
    
    
    March 1, 20074.11
    
    Junior Subordinated Indenture between
Summit Bank Corporation and The Bank
of New York, as trustee, dated
September 30, 2003
    
    10-K
    
    000-24947
    
    
    4.11
    
    
    March 1, 20074.12
    
    Registration Rights, Lockup and
Standstill Agreement by and among UCBH Holdings, Inc., CAB
International Holding Limited and Dr. Paul Shi H. Huang
    
    
    
    
    
    
    
    
    
    
    
    
    
    ü10.1
    
    Employment Agreement between UCBH
Holdings, Inc., United Commercial
Bank and Thomas S. Wu
    
    10-Q
    
    000-24947
    
    
    10.1
    
    
    November 9, 200410.2
    
    Form of Change in Control Agreement
among UCBH Holdings, Inc., United
Commercial Bank and Jonathan H.
Downing
    
    8-K
    
    000-24947
    
    
    10.2
    
    
    June 13, 200510.3
    
    Form of Change in Control Agreement
among UCBH Holdings, Inc., United
Commercial Bank and Sylvia Loh as
well as certain other Executive Vice
Presidents of UCBH Holdings, Inc. or
United Commercial Bank
    
    10-Q
    
    000-24947
    
    
    10.3
    
    
    November 9, 200410.4
    
    Form of Change in Control Agreement
among UCBH Holdings, Inc., United
Commercial Bank and Ka Wah (Tony)
Tsui as well as certain other Senior
Vice Presidents of UCBH Holdings,
Inc. or United Commercial Bank
    
    10-Q
    
    000-24947
    
    
    10.4
    
    
    November 9, 200410.5
    
    Form of Change in Control Agreement
among UCBH Holdings, Inc., United
Commercial Bank and Daniel Gautsch
    
    8-K
    
    000-24947
    
    
    10.1
    
    
    June 8, 200510.6
    
    Form of Change in Control Agreement
among UCBH Holdings, Inc., United
Commercial Bank and Dennis Wu
    
    8-K
    
    000-24947
    
    
    10.1
    
    
    June 13, 2005
 -42-




---



##### 



Exhibit
    
    
    
    Incorporated by Reference
    
    FiledNumber
    
    Exhibit Description
    
    Form
    
    File No.
    
    Exhibit
    
    Filing Date
    
    Herewith10.7
    
    Form of Change in Control Agreement
among UCBH Holdings, Inc., United
Commercial Bank and certain Senior
Vice Presidents of UCBH Holdings,
Inc. or United Commercial Bank
    
    10-Q
    
    000-24947
    
    
    10.1
    
    
    April 27, 200610.8
    
    UCBH Holdings, Inc. 2006 Equity
Incentive Plan, (formerly known as
UCBH Holdings, Inc. 1998 Stock Option
Plan)
    
    10-Q
    
    000-24947
    
    
    10.8
    
    
    August 9, 200610.9
    
    UCBH Holdings, Inc. Senior Executive
Annual Incentive Plan
    
    10-Q
    
    000-24947
    
    
    10.9
    
    
    August 9, 200610.10
    
    Form of Indemnification Agreement of
UCBH Holdings, Inc.
    
    8-K
    
    000-24947
    
    
    10.1
    
    
    May 18, 200610.11
    
    Form of Indemnification Agreement of
United Commercial Bank.
    
    8-K
    
    000-24947
    
    
    10.2
    
    
    May 18, 200610.12
    
    Post Retirement Compensation
Agreement between Pin Pin Chau, Chief
Executive Officer of Summit Bank
Corporation, and Summit Bank
Corporation dated December 20, 2004
    
    10-K
    
    000-24947
    
    
    10.12
    
    
    March 1, 200714.1
    
    Code of Conduct, as amended on August
14, 2004.
    
    8-K
    
    000-24947
    
    
    14.1
    
    
    September 1, 200421.0
    
    Subsidiaries of UCBH Holdings, Inc.
    
    10-K
    
    000-24947
    
    
    21.0
    
    
    March 1, 200731.1
    
    Certificate pursuant to Rule
13a-14(a) of the Securities Exchange
Act of 1934, as amended, signed and
dated by Thomas S. Wu.
    
    
    
    
    
    
    
    
    
    
    

ü31.2
    
    Certificate pursuant to Rule
13a-14(a) of the Securities Exchange
Act of 1934, as amended, signed and
dated by Dennis Wu.
    
    
    
    
    
    
    
    
    
    
    
    ü32.0
    
    Certificate pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act
of 2002, signed and dated by Thomas
S. Wu and Dennis Wu.
    
    
    
    
    
    
    
    
    
    
    
    
    (1
    )
 
 (1)
    
    Furnished herewith -43-




---



##### 



SIGNATURES
  UCBH HOLDINGS, INC.Date: May 10, 2007
    
    /s/ Thomas S. WuThomas S. WuChairman, President and
Chief Executive Officer(Principal Executive Officer)Date: May 10, 2007
    
    /s/ Dennis WuDennis WuDirector, Executive Vice President and
Chief Financial Officer(Principal Financial and Accounting Officer)
 -44-