2006 ANNUAL REPORT - Far East National Bank

• Total equity surpassed $200 million forthe first time.• Total deposits stood at $1.3 billionat year end with a good balance ofoverseas and domestic customers.• FENB’s investment portfolio enjoyed asignificant increase in yield, and weexpect similar gains in 2007.• Our loans continued to grow, totaling$1.2 billion in 2006, a 6% increase.We reestablished growth in ourcommercial real estate lending,with commitments up 26%.Finally, we achieved these revenue andincome increases while holding ourexpenses flat, in real dollars, since 2004.A Focus on CommunityWe believe strongly in leading by exampleto make a difference in the lives ofothers, and as a community bank, weknow that this commitment starts inour own backyard.In 2006, we enhanced our communityservice program. FENB employeescontributed thousands of hours ofcommunity service to more than 30locally-based organizations.FENB made more than $33 million inCommunity Reinvestment Act-relatedcommitments in the past three years inour home state of California. In 2006, wewere awarded seven Federal Home LoanBank Alternative Housing Program Awards.Enhanced Leadership CapabilitiesWe continued to strengthen our leadershipteam in 2006, welcoming 20-yearFENB veteran Edward Kuo to our Boardof Directors. Mr. Kuo serves as ExecutiveWe believe strongly in leadingby example to make a differencein the lives of others, and as acommunity bank, we know thatthis commitment starts in ourown backyard.Vice President and Chief Credit Officer,heading the credit committee, ensuringthe safety and soundness of the loanportfolio, managing the credit originationprocess, and providing leadershipin maintaining the board-prescribedcredit and compliance culture.In addition, Sophie Cheng joined usas Executive Vice President and RetailBanking group head. Previously, Ms.Cheng was the General Manager ofBank SinoPac’s Los Angeles Branch.Looking AheadIn 2007, we look forward to an excellentyear. Because we worked hard in 2006to ensure that our internal standardsand processes kept pace with the rapidand diverse growth of the Bank, we willshift to an even more customer-centricfocus in 2007.We will further expand our relationshipbasedservices. In particular, we willfocus on our significant overseas customerbase, introducing new servicesfor enterprises and individuals in Taiwanand China, using our existing businessas a strong foundation.We will revitalize InterContinentalFinancial Services accounts, which representthe leading edge of cross-Pacific,multi-currency banking. These accountsare ideal financial management toolsfor overseas businesses or individualswishing to globalize assets, conductbusiness or family transactions betweenAsia and the United States, or diversifyinvestments while reducing the riskinherent in foreign exchange. We willcontinue to promote our TreasuryMarketing Unit and to provide servicesto companies and high net worthindividuals with specialized needs inforeign exchange trading.Our philosophy is embodied by theChinese character “Yuen” – the centerpieceof SinoPac Holdings’ corporatesymbol. “Yuen” denotes all that we wishfor you in the coming year – perpetualprosperity, balance, and harmony.It is our honor to serve our community,customers, stakeholders, and employees.We look forward to being a partner inyour success for many years to come.Respectfully,Paul C. Lo, ChairmanFrederick C. Copeland, Jr., Vice ChairmanRobert W. Sweeney, President05