2001 Annual Report A Year of Growth Focus and discipline were our guiding principles during 2001, providing the strategic cornerstones for a year of extraordinary achievement. Our unwavering focus on the ethnic Chinese market and the development of enduring customer relationships, as well as our commitment to attentive and consistent client service, continue to be the foundation upon which we build our business. TABLE OF CONTENTS Financial Highlights 2 September 11, 2001 4 Letter to Fellow Shareholders 5 An Overview of 2001 8 Financial Statements 17 Corporate and Shareholder Information 69 Branch Office Locations 70 UCBH HOLDINGS, INC. FINANCIAL HIGHLIGHTS Company Profile UCBH Holdings, Inc. is the holding company for United Commercial Bank (UCB), a mid-sized financial institution with 31 offices located in the San Francisco Bay Area, Sacramento, Stockton, and Greater Los Angeles, and with a representative office in Hong Kong. The leading California bank serving the ethnic Chinese community, UCB provides a wide range of consumer banking services to individuals, and commer- cial banking services to small- and medium-sized businesses and professionals in a variety of industries. Net Income Core Deposits Loans dollars in thousands dollars in thousands dollars in thousands $30,488 $877,073 $2,264,303 $1,931,822 $24,128 $632,290 $1,686,695 $19,068 $458,133 1999 2000 2001 1999 2000 2001 1999 2000 2001 2 UCBH HOLDINGS, INC. FINANCIAL HIGHLIGHTS (dollars in thousands, except for earnings per share data) At, or for, the year ended December 31, 2001 2000 1999 Profitability Measures Net income $ 30,488 $ 24,128 $ 19,068 Return on assets 1.12% 1.02% 0.87% Return on equity 19.58% 20.12% 18.00% Efficiency ratio 46.79% 45.70% 49.74% Net interest margin (1) 3.73% 3.62% 3.34% Net interest spread (1) 3.34% 3.28% 3.09% Per Share Data Diluted earnings per share $ 1.53 $ 1.24 $ 1.01 Dividends per share $ 0.16 $ 0.10 $ – Balance Sheet Highlights Total assets $ 2,932,043 $ 2,502,119 $2,284,800 Securities 593,393 487,240 512,361 Loans 2,264,303 1,931,822 1,686,695 Core deposits 877,073 632,290 458,133 Total deposits 2,466,152 2,064,019 1,676,148 Borrowings 238,000 260,558 449,612 Stockholders’ equity 174,124 133,645 110,107 Total risk-based capital ratio (2) 10.91% 10.97% 11.29% Tier I leverage ratio (2) 7.26% 6.95% 6.58% Loan Highlights New commercial loan commitments $ 1,024,540 $ 675,512 $ 661,694 Consumer loan originations 144,741 49,671 69,496 Total loan originations $ 1,169,281 $ 725,183 $ 731,190 Nonperforming loans $ 991 $ 2,516 $ 4,632 Other real estate owned $ 0 $ 115 $ 722 Ratio of allowance for loan losses to total loans 1.53% 1.50% 1.16% Ratio of nonperforming loans to total loans 0.04% 0.13% 0.27% (1) Calculated on a tax equivalent basis (2) United Commercial Bank 3 .. All of us at UCBH were deeply affected by the horrific events in New York and Washington, D.C. on September 11. Satisfaction in our accomplishments is tempered by sadness at the loss of so many colleagues and friends in the World Trade Center attack. Our hearts go out to those who lost loved ones, and our sympathies, to those who lost jobs or homes. We are filled with admiration for the unsung heroes – those men and women who volunteered, personally or professionally, to assist in search and cleanup operations. Rather than destroying us, these events have reawakened and reinforced the values that made this country strong. Our complacency may be shattered, and our nation’s sense of security may be shaken, but we stand together, united in purpose and resolve. LETTER TO FELLOW SHAREHOLDERS In my letter to you last year, I discussed the fact that Focus and Growth would be our strategic watchwords going forward. Our strategy has served us well, and I am pleased to report that 2001 was a year of tremendous growth for UCBH Holdings, Inc. The company, operating through its subsidiary, United Commercial Bank, achieved record earnings for the year, generating net income of $30.5 million, an increase of $6.4 million, or 26%, over the previous year. Total assets increased 17.2%, from $2.50 billion to $2.93 billion. Total deposits increased from $2.06 billion to $2.47 billion, up 19%. Our unwavering focus on the ethnic Chinese market and the devel- opment of enduring customer relationships, and our commitment to attentive and consistent client service, continue to be the foundation upon which we build our business. Core deposits—checking and savings accounts—grew by 39% to $877.1 million in 2001, a remarkable achievement in an economic environment characterized by continuous cuts in market interest rates. While deposit generation slowed in the banking industry as a whole, we were able to increase our deposit base sub- stantially. Core deposits play an important role in a financial institution such as ours, since they provide a stable and relatively inexpensive funding source and improve our net interest margin. Adopting a proactive stance in the pursuit of these deposits, we established a committee that focuses solely on deposit generation and instituted an employee incentive program to bring in more of these accounts. Our success in this area was one of the drivers of our growth for the year. Loan originations also contributed to our success in 2001, as our loan portfolios grew significantly. United Commercial Bank originated $1.17 billion in loans last year, 88% of which were commercial and 12%, con- sumer. A conservative but responsive approach, a strong risk management process, and a strict adherence to stringent credit criteria helped us maintain excellent credit quality. Our nonperforming asset ratio was down to a historic low of 0.03% at year-end. We had increased our allowance for loan losses to 1.53% in 2001, from 1.50% in 2000. It gives me great pleasure to report that the bank had no net charge-offs for the entire year of 2001, and that net loan recoveries were $29,000 for the year. Last year we achieved a balanced ratio between the Northern and Southern California regions in new business generation, a goal we thought would not be achievable until 2002. We continue to see tremendous business opportunities in Southern California, an area of focus in growing our franchise. Trans-Pacific traffic, both in and out of the ports in Long Beach and Los Angeles, is increasing as more companies in the United States are taking advantage of the favorable business environments in Mainland China. We anticipate that this business trend will continue to grow rapidly as a result of the entry of China and Taiwan into the World Trade Organization in 2001. 5 LETTER TO FELLOW SHAREHOLDERS Working closely with the Commercial Banking Division, our International Banking Division, established in December 2000, is expanding its presence throughout California. In 2001 we further enhanced our capabili- ties in this area by automating our trade finance system. Through our interactive, bilingual Internet portal, ibankUNITED.com, which is available in both English and Chinese, trade finance customers can now view their accounts and the status of all trade-related transactions online. Customers can also open letters of credit online, which improves our efficiency and turn-around time significantly. Portal traffic increased dramatically in 2001, as both commercial and consumer customers logged on to conduct transactions and manage their accounts. There was an exponential increase in monthly page views in the last quarter of the year. Our Asia Banking Division, established in July 2000, had a very successful year, as well. The division’s mandate is to build relationships with high net worth individuals whose business interests straddle the Pacific Rim, and to provide them with a superior level of personalized service. To that end, we recently opened an office in Hong Kong. Bank representatives in this office are able to facilitate trade transactions for California-based customers who conduct business with companies in Hong Kong and Mainland China. The restructuring of our balance sheet from a thrift-oriented institution to a commercial bank will be com- pleted by 2003, as planned. Our achievements have securely positioned UCBH for future growth in size and profitability, as we remain focused on the niche market we have served so successfully. We believe it is our discipline and our focus on proven business strategies that have fueled our consistent growth over the past three and one-half years. Our stock price appreciated 22% in 2001. UCBH Holdings, Inc. is now included in the Russell 2000 Index, the S&P Small-Cap 600 Index and the NASDAQ-100 Financial Index. We will continue to solidify our position as the nation’s premier ethnic Chinese bank and to build shareholder value. I do not want to end my discussion of our achievements without acknowledging the horrific events that occurred in New York and Washington, D.C. on September 11th. All of us at UCBH have been deeply affected by the tragedy. Satisfaction in our accomplishments is tempered by sadness at the loss of so many colleagues and friends in the World Trade Center attack. Rather than destroying us, however, these events have reawak- ened and reinforced the values that made this country strong. Our complacency may have been shattered, and our nation’s sense of security may have been shaken, but we stand together, united in purpose and resolve. Our continuing success would not be possible without the loyalty of our customers, the hard work and dedi- cation of our employees, the confidence of our shareholders and the guidance of our Board of Directors.