LOS ANGELES, April 20, 2016 (GLOBE NEWSWIRE) -- Preferred Bank (NASDAQ:PFBC), an independent commercial bank, today reported results for the quarter ended March 31, 2016. Preferred Bank (“the Bank”) reported net income of $7.8 million or $0.56 per diluted share for the first quarter of 2016. This compares to net income of $6.7 million or $0.48 per diluted share for the first quarter of 2015 and compares to net income of $7.5 million or $0.54 per diluted share for the fourth quarter of 2015. Net income for the fourth quarter was impacted by merger-related costs which totaled $658,000 on a pre-tax basis during the quarter.
Highlights from the first quarter of 2016:
| -- Linked quarter loan growth | $97.5 million or 4.8% | |||
| -- Linked quarter deposit growth | $71.3 million or 3.1% | |||
| -- Return on average assets | 1.21 | % | ||
| -- Return on beginning equity | 11.94 | % | ||
| -- Efficiency ratio | 44.1 | % | ||
| -- Net interest margin | 3.79 | % | ||
Li Yu, Chairman and CEO commented, “Our Bank continued its pattern of growth in the first quarter of 2016. Loans increased by $97.5 million or 4.8% on a linked quarter basis. On that same basis, deposits increased $71.3 million or 3.1%. Net income for the quarter was $7.8 million or $0.56 per diluted share. Net income was negatively impacted by the correction of an error in prior year’s interest income of $805,000. Without this and the partial offset of an interest recovery our net interest margin would have been 3.89% instead of the 3.79% we reported.
“Our efficiency ratio was 44.1% in the first quarter of 2016. First quarter expenses included full quarter expense for the New York operations as well as a $665,000 increase in employer-paid taxes related to bonus payouts which occur each first quarter. In addition, the Bank is continually adding front line personnel as well as personnel in compliance-related areas.
“The Bank’s allowance for loan losses increased by $1.02 million consisting of a provision for loan losses of $800,000 as well as a $223,000 loan recovery.
“All other aspects of our Bank are progressing according to plan and we feel strongly about our continued success through 2016.”
Net Interest Income and Net Interest Margin. Net interest income before provision for loan and lease losses was $23.9 million for the first quarter of 2016. This compares favorably to the $19.4 million recorded in the first quarter of 2015 and to the $22.3 million recorded in the fourth quarter of 2015. The increase over both comparable periods is due primarily to loan growth, and was aided by the UIB acquisition which closed on November 20, 2015. The Bank’s taxable equivalent net interest margin was 3.79% for the first quarter of 2016, a 4 basis point decrease from the 3.83% achieved in the first quarter of 2015 and a 9 basis point decrease from the 3.88% recorded in the fourth quarter of 2015. During the quarter, we noted errors in the accrual of interest on several loans which had been charged-off as early as 2011. The amount involved was deemed to be immaterial and this event, which caused the late filing of our 10-K, was confirmed to be isolated after a review of all other loans like these. The total cumulative amount involved was $805,000 and this amount was recorded in the first quarter of 2016 as a reduction of loan interest income. Separately, interest income of $253,000 was collected from the payoff of a loan previously on nonaccrual status. Combining these two items, our net interest margin was impacted by approximately 10 basis points.
Noninterest Income. For the first quarter of 2016, noninterest income was $1,163,000 compared with $868,000 for the same quarter last year and compared to $954,000 for the fourth quarter of 2015. Service charges on deposits were primarily flat compared to the same period last year but were up by $40,000 over the fourth quarter of 2015. Trade finance income was $417,000 for the first quarter of 2016, an increase of $110,000 compared to the same period last year and a decrease of $36,000 compared to the fourth quarter of 2015. Other income was $331,000, an increase of $152,000 over the first quarter of 2015 and an increase of $169,000 from the fourth quarter of 2015. The increase over both comparable periods was due to the receipt of $153,000 in life insurance proceeds due to the passing of a former officer.
Noninterest Expense. Total noninterest expense was $11.0 million for the first quarter of 2016, an increase of $2.4 million over the same period last year and an increase of $1.1 million over the fourth quarter of 2015. Salaries and benefits expense totaled $7.0 million for the first quarter of 2016 compared to $5.3 million recorded for both the same period last year and the fourth quarter of 2015. The increase over the same period last year was due primarily to staffing/merit increases of $729,000 (much of that due to UIB), payroll taxes of $260,000 and an increase in the bonus accrual. The increase over the fourth quarter of 2015 was due to an increase in payroll taxes of $666,000, an increase in salaries/staffing of $461,000, and an increase in vacation expense of $248,000. Occupancy expense totaled $1.2 million compared to the $851,000 recorded in the same period in 2015 and the $1.0 million recorded in the fourth quarter of 2015. The increase over the prior year was due mainly to the addition of the New York office with the UIB acquisition as well as a new administrative office which the Bank opened in November 2015 in El Monte, California. Professional services expense was $962,000 for the first quarter of 2016 compared to $1.1 million for the same quarter of 2015 and $1.4 million recorded in the fourth quarter of 2015. The reductions were mainly a result of lower legal fees. The Bank incurred $199,000 in costs related to its one OREO property. This compares to OREO expense of $89,000 in the first quarter of 2015. Other expenses were $1.1 million for the first quarter of 2016 compared to $920,000 for the same period last year and $1.7 million for the fourth quarter of 2015. The fourth quarter of 2015 was impacted by $658,000 of acquisition-related charges.
Income Taxes
The Bank recorded a provision for income taxes of $5.4 million for the first quarter of 2016. This represents an effective tax rate (“ETR”) of 40.6% for the quarter. This is up from the ETR of 39.8% for the first quarter of 2015 but down from the 42.2% ETR recorded in the fourth quarter of 2015. The high level in the fourth quarter of 2015 was due mainly to tax adjustments associated with the UIB acquisition. The increase over the prior year is due primarily to the Bank’s growing profitability relative to tax exempt income and deductible items.
Balance Sheet Summary
Total gross loans and leases at March 31, 2016 were $2.16 billion, an increase of $98.6 million or 4.8% over the total of $2.06 billion as of December 31, 2015. The tables below indicate loans by type as of March 31, 2016 as compared to the end of 2015:
Loans by Type
| Loan Type (000’s) | March 31, 2016 | December 31, 2015 | $ Change | % Change | ||||||||
| R/E – Residential/Multifamily | $ | 401,708 | $ | 415,097 | $ | (13,389 | ) | -3.2 | % | |||
| R/E – Land | 16,654 | 16,713 | (59 | ) | -0.4 | % | ||||||
| R/E – Commercial | 924,913 | 861,317 | 63,596 | 7.4 | % | |||||||
| R/E – Construction | 148,789 | 131,404 | 17,385 | 13.2 | % | |||||||
| Commercial & Industrial | 665,922 | 635,465 | 30,457 | 4.8 | % | |||||||
| Total | $ | 2,157,986 | $ | 2,059,996 | $ | 97,990 | 4.8 | % | ||||
Total deposits as of March 31, 2016 were $2.36 billion, an increase of $71.3 million from the $2.29 billion at December 31, 2015. As of March 31, 2016 compared to December 31, 2015; noninterest-bearing demand deposits decreased by $30.8 million or 5.5%, interest-bearing demand and savings deposits increased by $53.8 million or 6.9% and time deposits increased by $48.3 million or 5.1%. Total assets were $2.68 billion, an $84.5 million or 3.3% increase from the total of $2.60 billion as of December 31, 2015.
Asset Quality
As of March 31, 2016 nonaccrual loans totaled $1.0 million, down from the $2.0 million total as of December 31, 2015. Total net charge-offs (recoveries) for the first quarter of 2016 were ($223,000) compared to $1.7 million in the fourth quarter of 2015 and compared to $86,000 for the first quarter of 2015. The Bank recorded a provision for loan losses of $800,000 for the first quarter of 2016. Although nonperforming loan and economic trends continue to be positive, management believes that due to growth and other factors, this provision is appropriate in order to maintain an allowance level deemed sufficient for probable incurred losses. This is an increase from the $500,000 provision recorded in the same quarter last year and to the $300,000 provision recorded in the fourth quarter of 2015. The allowance for loan loss at March 31, 2016 was $23.7 million or 1.10% of total loans compared to $22.7 million or 1.10% of total loans at December 31, 2015.
OREO
As of March 31, 2016 and December 31, 2015, the Bank held one OREO property, a $4.1 million multi-family property located outside of California.
Capitalization
As of March 31, 2016, the Bank’s leverage ratio was 10.29%, the common equity tier 1 capital ratio was 10.74% and the total capital ratio was 11.70%. As of December 31, 2015, the Bank’s leverage ratio was 10.46%, the common equity tier 1 ratio was 11.03% and the total risk based capital ratio was 12.0%.
Conference Call and Webcast
A conference call with simultaneous webcast to discuss Preferred Bank’s first quarter 2016 financial results will be held tomorrow, April 21st at 2:00 p.m. Eastern / 11:00 a.m. Pacific. Interested participants and investors may access the conference call by dialing 866-652-5200 (domestic) or 412-317-6060 (international) and referencing “Preferred Bank.” There will also be a live webcast of the call available at the Investor Relations section of Preferred Bank's website at www.preferredbank.com. Web participants are encouraged to go to the website at least 15 minutes prior to the start of the call to register, download and install any necessary audio software.
Preferred Bank's Chairman and CEO Li Yu, President and COO Wellington Chen, Chief Financial Officer Edward J. Czajka, and Chief Credit Officer Nick Pi will be present to discuss Preferred Bank's financial results, business highlights and outlook. After the live webcast, a replay will remain available in the Investor Relations section of Preferred Bank's website. A replay of the call will also be available at 877-344-7529 (domestic) or 412-317-0088 (international) through May 5, 2016; the passcode is 10084215.
About Preferred Bank
Preferred Bank is one of the larger independent commercial banks in California. The bank is chartered by the State of California, and its deposits are insured by the Federal Deposit Insurance Corporation, or FDIC, to the maximum extent permitted by law. The Company conducts its banking business from its main office in Los Angeles, California, and through eleven full-service branch banking offices in the California cities of Alhambra, Century City, City of Industry, Torrance, Arcadia, Irvine, Diamond Bar, Anaheim, Pico Rivera, Tarzana and San Francisco, and one office in Flushing, New York. Preferred Bank offers a broad range of deposit and loan products and services to both commercial and consumer customers. The bank provides personalized deposit services as well as real estate finance, commercial loans and trade finance to small and mid-sized businesses, entrepreneurs, real estate developers, professionals and high net worth individuals. Although originally founded as a Chinese-American Bank, Preferred Bank now derives most of its customers from the diversified mainstream market but does continue to benefit from the significant migration to California of ethnic Chinese from China and other areas of East Asia.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the Bank’s future financial and operating results, the Bank's plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of the Bank’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: changes in economic conditions; changes in the California real estate market; the loss of senior management and other employees; natural disasters or recurring energy shortage; changes in interest rates; competition from other financial services companies; ineffective underwriting practices; inadequate allowance for loan and lease losses to cover actual losses; risks inherent in construction lending; adverse economic conditions in Asia; downturn in international trade; inability to attract deposits; inability to raise additional capital when needed or on favorable terms; inability to manage growth; inadequate communications, information, operating and financial control systems, technology from fourth party service providers; the U.S. government’s monetary policies; government regulation; environmental liability with respect to properties to which the bank takes title; and the threat of terrorism. Additional factors that could cause the Bank's results to differ materially from those described in the forward-looking statements can be found in the Bank’s 2015 Annual Report on Form 10-K filed with the Federal Deposit Insurance Corporation which can be found on Preferred Bank’s website. The forward-looking statements in this press release speak only as of the date of the press release, and the Bank assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those contained in the forward-looking statements. For additional information about Preferred Bank, please visit the Bank’s website at www.preferredbank.com.
Financial Tables to Follow
| PREFERRED BANK | |||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||
| (unaudited) | |||||||||||||||
| (in thousands, except for net income per share and shares) | |||||||||||||||
| For the Quarter Ended | |||||||||||||||
| March 31, | December 31, | March 31, | |||||||||||||
| 2016 | 2015 | 2015 | |||||||||||||
| Interest income: | |||||||||||||||
| Loans, including fees | $ | 25,460 | $ | 23,792 | $ | 20,355 | |||||||||
| Investment securities | 1,784 | 1,585 | 1,457 | ||||||||||||
| Fed funds sold | 77 | 46 | 34 | ||||||||||||
| Total interest income | 27,321 | 25,423 | 21,846 | ||||||||||||
| Interest expense: | |||||||||||||||
| Interest-bearing demand | 1,050 | 871 | 786 | ||||||||||||
| Savings | 18 | 14 | 15 | ||||||||||||
| Time certificates | 2,315 | 2,150 | 1,649 | ||||||||||||
| FHLB borrowings | 59 | 70 | 32 | ||||||||||||
| Total interest expense | 3,442 | 3,105 | 2,482 | ||||||||||||
| Net interest income | 23,879 | 22,318 | 19,364 | ||||||||||||
| Provision for loan losses | 800 | 300 | 500 | ||||||||||||
| Net interest income after provision for loan losses | 23,079 | 22,018 | 18,864 | ||||||||||||
| Noninterest income: | |||||||||||||||
| Fees & service charges on deposit accounts | 294 | 254 | 299 | ||||||||||||
| Trade finance income | 417 | 453 | 307 | ||||||||||||
| BOLI income | 85 | 86 | 83 | ||||||||||||
| Net gain (loss) on sale of investment securities | 36 | - | - | ||||||||||||
| Other income | 331 | 161 | 179 | ||||||||||||
| Total noninterest income | 1,163 | 954 | 868 | ||||||||||||
| Noninterest expense: | |||||||||||||||
| Salary and employee benefits | 7,021 | 5,248 | 5,312 | ||||||||||||
| Net occupancy expense | 1,203 | 1,024 | 851 | ||||||||||||
| Business development and promotion expense | 222 | 227 | 109 | ||||||||||||
| Professional services | 962 | 1,359 | 1,083 | ||||||||||||
| Office supplies and equipment expense | 351 | 336 | 254 | ||||||||||||
| Other real estate owned related (income)expense and valuation allowance on LHFS | 199 | 1 | 89 | ||||||||||||
| Other | 1,080 | 1,696 | 920 | ||||||||||||
| Total noninterest expense | 11,038 | 9,890 | 8,618 | ||||||||||||
| Income before provision for income taxes | 13,204 | 13,081 | 11,114 | ||||||||||||
| Income tax expense | 5,361 | 5,518 | 4,424 | ||||||||||||
| Net income | $ | 7,843 | $ | 7,563 | $ | 6,690 | |||||||||
| Income per share available to common shareholders | |||||||||||||||
| Basic | $ | 0.56 | $ | 0.55 | $ | 0.49 | |||||||||
| Diluted | $ | 0.56 | $ | 0.54 | $ | 0.48 | |||||||||
| Weighted-average common shares outstanding | |||||||||||||||
| Basic | 13,796,892 | 13,547,197 | 13,397,140 | ||||||||||||
| Diluted | 13,911,195 | 13,743,157 | 13,805,504 | ||||||||||||
| Dividends per share | $ | 0.15 | $ | 0.15 | $ | 0.12 | |||||||||
| PREFERRED BANK | |||||||||||
| Condensed Consolidated Statements of Financial Condition | |||||||||||
| (unaudited) | |||||||||||
| (in thousands) | |||||||||||
| March 31, | December 31, | ||||||||||
| 2016 | 2015 | ||||||||||
| (Unaudited) | (Audited) | ||||||||||
| Assets | |||||||||||
| Cash and due from banks | $ | 251,047 | $ | 296,175 | |||||||
| Fed funds sold | 42,500 | 13,000 | |||||||||
| Cash and cash equivalents | 293,547 | 309,175 | |||||||||
| Securities held to maturity, at amortized cost | 5,550 | 5,830 | |||||||||
| Securities available-for-sale, at fair value | 162,654 | 169,502 | |||||||||
| Loans and leases | 2,157,986 | 2,059,392 | |||||||||
| Less allowance for loan and lease losses | (23,681 | ) | (22,658 | ) | |||||||
| Less net deferred loan fees | (3,065 | ) | (3,012 | ) | |||||||
| Net loans and leases | 2,131,240 | 2,033,722 | |||||||||
| Other real estate owned | 4,112 | 4,112 | |||||||||
| Customers' liability on acceptances | 969 | 897 | |||||||||
| Bank furniture and fixtures, net | 5,745 | 5,601 | |||||||||
| Bank-owned life insurance | 8,651 | 8,763 | |||||||||
| Accrued interest receivable | 8,014 | 8,128 | |||||||||
| Investment in affordable housing | 25,499 | 16,052 | |||||||||
| Federal Home Loan Bank stock | 6,965 | 7,162 | |||||||||
| Deferred tax assets | 23,733 | 23,802 | |||||||||
| Income tax receivable | 1,637 | 299 | |||||||||
| Other asset | 5,034 | 5,801 | |||||||||
| Total assets | $ | 2,683,350 | $ | 2,598,846 | |||||||
| Liabilities and Shareholders' Equity | |||||||||||
| Liabilities: | |||||||||||
| Deposits: | |||||||||||
| Demand | $ | 528,126 | $ | 558,906 | |||||||
| Interest-bearing demand | 803,374 | 748,918 | |||||||||
| Savings | 30,002 | 30,703 | |||||||||
| Time certificates of $250,000 or more | 339,971 | 321,537 | |||||||||
| Other time certificates | 656,386 | 626,495 | |||||||||
| Total deposits | $ | 2,357,859 | $ | 2,286,559 | |||||||
| Acceptances outstanding | 969 | 897 | |||||||||
| Advances from Federal Home Loan Bank | 26,601 | 26,635 | |||||||||
| Commitments to fund investment in affordable housing partnership | 11,454 | 3,958 | |||||||||
| Accrued interest payable | 2,131 | 1,919 | |||||||||
| Other liabilities | 10,762 | 14,733 | |||||||||
| Total liabilities | 2,409,776 | 2,334,701 | |||||||||
| Commitments and contingencies | |||||||||||
| Shareholders' equity: | |||||||||||
| Preferred stock. Authorized 25,000,000 shares; no issued and outstanding shares at March 31, 2016 and December 31, 2015 | — | — | |||||||||
| Common stock, no par value. Authorized 100,000,000 shares; issued and outstanding 14,057,755 and 13,884,942 shares at March 31, 2016 and December 31, 2015, respectively | 167,213 | 166,560 | |||||||||
| Treasury stock | (19,115 | ) | (19,115 | ) | |||||||
| Additional paid-in-capital | 37,682 | 34,672 | |||||||||
| Accumulated income | 86,715 | 81,046 | |||||||||
| Accumulated other comprehensive income: | |||||||||||
| Unrealized gain on securities, available-for-sale, net of tax of $783 and $713 at March 31, 2016 and December 31, 2015 | 1,079 | 982 | |||||||||
| Total shareholders' equity | 273,574 | 264,145 | |||||||||
| Total liabilities and shareholders' equity | $ | 2,683,350 | $ | 2,598,846 | |||||||
| PREFERRED BANK | ||||||||||||||||||||||||
| Selected Consolidated Financial Information | ||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||
| (in thousands, except for ratios) | ||||||||||||||||||||||||
| For the Quarter Ended | ||||||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||||
| 2016 | 2015 | 2015 | 2015 | 2015 | ||||||||||||||||||||
| Unaudited historical quarterly operations data: | ||||||||||||||||||||||||
| Interest income | $ | 27,321 | $ | 25,423 | $ | 24,380 | $ | 23,053 | $ | 21,846 | ||||||||||||||
| Interest expense | 3,442 | 3,105 | 2,783 | 2,486 | 2,482 | |||||||||||||||||||
| Interest income before provision for credit losses | 23,879 | 22,318 | 21,597 | 20,567 | 19,364 | |||||||||||||||||||
| Provision for credit losses | 800 | 300 | 500 | 500 | 500 | |||||||||||||||||||
| Noninterest income | 1,163 | 954 | 940 | 1,131 | 868 | |||||||||||||||||||
| Noninterest expense | 11,038 | 9,890 | 8,740 | 8,462 | 8,618 | |||||||||||||||||||
| Income tax expense | 5,361 | 5,518 | 5,396 | 5,147 | 4,424 | |||||||||||||||||||
| Net income | 7,843 | 7,563 | 7,901 | 7,589 | 6,690 | |||||||||||||||||||
| Earnings per share | ||||||||||||||||||||||||
| Basic | $ | 0.56 | $ | 0.55 | $ | 0.57 | $ | 0.55 | $ | 0.49 | ||||||||||||||
| Diluted | $ | 0.56 | $ | 0.54 | $ | 0.57 | $ | 0.55 | $ | 0.48 | ||||||||||||||
| Ratios for the period: | ||||||||||||||||||||||||
| Return on average assets | 1.21 | % | 1.28 | % | 1.42 | % | 1.44 | % | 1.28 | % | ||||||||||||||
| Return on beginning equity | 11.94 | % | 11.67 | % | 12.55 | % | 12.49 | % | 11.54 | % | ||||||||||||||
| Net interest margin (Fully-taxable equivalent) | 3.79 | % | 3.88 | % | 4.00 | % | 4.01 | % | 3.83 | % | ||||||||||||||
| Noninterest expense to average assets | 1.70 | % | 1.67 | % | 1.58 | % | 1.60 | % | 1.65 | % | ||||||||||||||
| Efficiency ratio | 44.08 | % | 42.50 | % | 38.78 | % | 39.00 | % | 42.60 | % | ||||||||||||||
| Net charge-offs (recoveries) to average loans (annualized) | -0.04 | % | 0.36 | % | 0.05 | % | 0.03 | % | 0.02 | % | ||||||||||||||
| Ratios as of period end: | ||||||||||||||||||||||||
| Tier 1 leverage capital ratio | 10.29 | % | 10.46 | % | 11.47 | % | 11.59 | % | 11.26 | % | ||||||||||||||
| Common equity tier 1 risk-based capital ratio | 10.74 | % | 11.03 | % | 11.80 | % | 11.91 | % | 12.10 | % | ||||||||||||||
| Tier 1 risk-based capital ratio (1) | 10.74 | % | 11.03 | % | 11.80 | % | 11.91 | % | 12.10 | % | ||||||||||||||
| Total risk-based capital ratio (1) | 11.70 | % | 12.00 | % | 12.93 | % | 13.07 | % | 13.30 | % | ||||||||||||||
| Allowances for credit losses to loans and leases at end of period (2) | 1.10 | % | 1.10 | % | 1.31 | % | 1.36 | % | 1.40 | % | ||||||||||||||
| Allowance for credit losses to non-performing loans and leases | 2346.18 | % | 1140.29 | % | 303.27 | % | 299.06 | % | 288.16 | % | ||||||||||||||
| Average balances: | ||||||||||||||||||||||||
| Total loans and leases (3) | $ | 2,067,047 | $ | 1,876,544 | $ | 1,741,762 | $ | 1,673,710 | $ | 1,612,556 | ||||||||||||||
| Earning assets | $ | 2,550,821 | $ | 2,297,154 | $ | 2,160,075 | $ | 2,070,542 | $ | 2,064,435 | ||||||||||||||
| Total assets | $ | 2,605,907 | $ | 2,345,319 | $ | 2,201,060 | $ | 2,117,610 | $ | 2,115,354 | ||||||||||||||
| Total deposits | $ | 2,291,764 | $ | 2,039,567 | $ | 1,907,719 | $ | 1,832,688 | $ | 1,834,920 | ||||||||||||||
| (1) Risk-based capital ratios were calculated under BASEL III rules, which became effective on January 1, 2015. Ratios for the prior periods were calculated under Basel I rules. | ||||||||||||||||||||||||
| (2) Loans held for sale are excluded | ||||||||||||||||||||||||
| (3) Loans held for sale are included | ||||||||||||||||||||||||
| PREFERRED BANK | ||||||||||||||||||||||
| Selected Consolidated Financial Information | ||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||
| (in thousands, except for ratios) | ||||||||||||||||||||||
| As of | ||||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||
| 2016 | 2015 | 2015 | 2015 | 2015 | ||||||||||||||||||
| Unaudited quarterly statement of financial position data: | ||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||
| Cash and cash equivalents | $ | 293,547 | $ | 309,175 | $ | 232,707 | $ | 208,015 | $ | 242,053 | ||||||||||||
| Securities held-to-maturity, at amortized cost | 5,550 | 5,830 | 6,307 | 6,806 | 7,139 | |||||||||||||||||
| Securities available-for-sale, at fair value | 162,654 | 169,502 | 164,378 | 161,775 | 165,330 | |||||||||||||||||
| Loans and Leases: | ||||||||||||||||||||||
| Real estate - Single and multi-family residential | $ | 401,708 | $ | 415,003 | $ | 328,124 | $ | 290,186 | $ | 306,284 | ||||||||||||
| Real estate - Land for housing | 14,838 | 14,408 | 14,429 | 13,102 | 11,658 | |||||||||||||||||
| Real estate - Land for income properties | 1,816 | 1,795 | 1,876 | 1,891 | 1,906 | |||||||||||||||||
| Real estate - Commercial | 924,913 | 861,317 | 770,494 | 712,383 | 676,034 | |||||||||||||||||
| Real estate - For sale housing construction | 82,153 | 73,858 | 79,406 | 71,945 | 50,458 | |||||||||||||||||
| Real estate - Other construction | 66,636 | 57,546 | 48,438 | 49,413 | 84,065 | |||||||||||||||||
| Commercial and industrial | 626,599 | 596,887 | 555,680 | 570,408 | 502,453 | |||||||||||||||||
| Trade finance and other | 39,323 | 38,578 | 38,602 | 40,403 | 38,234 | |||||||||||||||||
| Gross loans | 2,157,986 | 2,059,392 | 1,837,049 | 1,749,731 | 1,671,092 | |||||||||||||||||
| Allowance for loan and lease losses | (23,681 | ) | (22,658 | ) | (24,055 | ) | (23,758 | ) | (23,388 | ) | ||||||||||||
| Net deferred loan fees | (3,065 | ) | (3,012 | ) | (2,476 | ) | (2,179 | ) | (2,216 | ) | ||||||||||||
| Total loans, net | $ | 2,131,240 | $ | 2,033,722 | $ | 1,810,518 | $ | 1,723,794 | $ | 1,645,488 | ||||||||||||
| Other real estate owned | $ | 4,112 | $ | 4,112 | $ | - | $ | - | $ | 8,811 | ||||||||||||
| Investment in affordable housing | 25,499 | 16,052 | 16,589 | 17,059 | 17,529 | |||||||||||||||||
| Federal Home Loan Bank stock | 6,965 | 7,162 | 6,677 | 6,677 | 6,155 | |||||||||||||||||
| Other assets | 53,783 | 53,291 | 45,370 | 46,030 | 45,208 | |||||||||||||||||
| Total assets | $ | 2,683,350 | $ | 2,598,846 | $ | 2,282,546 | $ | 2,170,156 | $ | 2,137,713 | ||||||||||||
| Liabilities: | ||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||
| Demand | $ | 528,126 | $ | 558,906 | $ | 477,523 | $ | 519,501 | $ | 493,440 | ||||||||||||
| Interest-bearing demand | 803,374 | 748,918 | 697,402 | 568,243 | 585,286 | |||||||||||||||||
| Savings | 30,002 | 30,703 | 21,159 | 23,855 | 24,056 | |||||||||||||||||
| Time certificates of $250,000 or more | 339,971 | 321,537 | 263,949 | 260,205 | 243,360 | |||||||||||||||||
| Other time certificates | 656,386 | 626,495 | 527,602 | 510,394 | 510,809 | |||||||||||||||||
| Total deposits | $ | 2,357,859 | $ | 2,286,559 | $ | 1,987,635 | $ | 1,882,198 | $ | 1,856,950 | ||||||||||||
| Advances from Federal Home Loan Bank | $ | 26,601 | $ | 26,635 | $ | 20,000 | $ | 20,000 | $ | 20,000 | ||||||||||||
| Commitments to fund investment in affordable housing partnership | 11,454 | 3,958 | 4,139 | 4,139 | 7,726 | |||||||||||||||||
| Other liabilities | 13,862 | 17,549 | 13,590 | 13,954 | 9,299 | |||||||||||||||||
| Total liabilities | $ | 2,409,776 | $ | 2,334,701 | $ | 2,025,364 | $ | 1,920,291 | $ | 1,893,974 | ||||||||||||
| Equity: | ||||||||||||||||||||||
| Net common stock, no par value | $ | 185,780 | $ | 182,118 | $ | 180,310 | $ | 179,360 | $ | 177,978 | ||||||||||||
| Retained earnings | 86,715 | 81,046 | 75,629 | 69,431 | 63,545 | |||||||||||||||||
| Accumulated other comprehensive income | 1,079 | 982 | 1,243 | 1,074 | 2,216 | |||||||||||||||||
| Total shareholders' equity | $ | 273,574 | $ | 264,145 | $ | 257,182 | $ | 249,865 | $ | 243,739 | ||||||||||||
| Total liabilities and shareholders' equity | $ | 2,683,350 | $ | 2,598,846 | $ | 2,282,546 | $ | 2,170,156 | $ | 2,137,713 | ||||||||||||
| Preferred Bank | ||||||||||||||
| Loan and Credit Quality Information | ||||||||||||||
| Allowance For Credit Losses & Loss History | ||||||||||||||
| For the Quarter Ended | Year Ended | |||||||||||||
| March 31, 2016 | December 31, 2015 | |||||||||||||
| (Dollars in 000's) | ||||||||||||||
| Allowance For Credit Losses | ||||||||||||||
| Balance at Beginning of Period | $ | 22,658 | $ | 22,974 | ||||||||||
| Charge-Offs | ||||||||||||||
| Commercial & Industrial | - | 1,475 | ||||||||||||
| Mini-perm Real Estate | - | 1,793 | ||||||||||||
| Construction - Residential | - | - | ||||||||||||
| Construction - Commercial | - | - | ||||||||||||
| Land - Residential | - | - | ||||||||||||
| Land - Commercial | - | - | ||||||||||||
| Others | - | - | ||||||||||||
| Total Charge-Offs | - | 3,268 | ||||||||||||
| Recoveries | ||||||||||||||
| Commercial & Industrial | 196 | 131 | ||||||||||||
| Mini-perm Real Estate | - | 144 | ||||||||||||
| Construction - Residential | - | - | ||||||||||||
| Construction - Commercial | - | 20 | ||||||||||||
| Land - Residential | - | 100 | ||||||||||||
| Land - Commercial | 27 | 757 | ||||||||||||
| Total Recoveries | 223 | 1,152 | ||||||||||||
| Net Loan Charge-Offs | (223 | ) | 2,116 | |||||||||||
| Provision for Credit Losses | 800 | 1,800 | ||||||||||||
| Balance at End of Period | $ | 23,681 | $ | 22,658 | ||||||||||
| Average Loans and Leases* | $ | 2,067,047 | $ | 1,731,871 | ||||||||||
| Loans and Leases at end of Period* | $ | 2,157,986 | $ | 2,059,392 | ||||||||||
| Net Charge-Offs to Average Loans and Leases | -0.04 | % | 0.12 | % | ||||||||||
| Allowances for credit losses to loans and leases at end of period ** | 1.10 | % | 1.10 | % | ||||||||||
| * Loans held for sale are included | ||||||||||||||
| ** Loans held for sale are excluded | ||||||||||||||