Preferred Bank Announces Completion of $62.5 Million Private Placement of Subordinated Notes
June 13 2016 - 4:01PM
Preferred Bank (NASDAQ:PFBC), an independent
commercial bank, today announced the completion of a private
placement of $62.5 million in principal amount of fixed-to-floating
rate subordinated notes to certain qualified investors. The
proceeds from the placement of the notes will be used for general
corporate purposes, capital management and to support future
growth.
Terms of the Subordinated Notes The
subordinated notes have a maturity date of June 15, 2026 and bear
interest, payable semi-annually, at the rate of 6.0% per annum
until June 15, 2021. On that date, the interest rate will be
adjusted to float at a rate equal to the three-month LIBOR rate
plus 467.3 basis points (4.673%) until maturity. The notes include
a right of prepayment, on or after June 15, 2021 and, in certain
limited circumstances, before that date. The indebtedness evidenced
by the subordinated notes, including principal and interest, is
unsecured and subordinate and junior in right to payment to general
and secured creditors and depositors of Preferred Bank. The
subordinated notes have been structured to qualify as Tier 2
capital for regulatory purposes.
Sandler O’Neill + Partners, LP acted as placement agent for the
private placement of the subordinated notes. Manatt, Phelps &
Phillips, LLP acted as issuer’s counsel and King, Holmes, Paterno
and Soriano, LLP acted as placement agent’s counsel.
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.
Preferred Bank 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 continues to benefit from the significant migration to
California of ethnic Chinese from China and other areas of East
Asia.
Forward-Looking StatementsThis 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 third
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 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.
AT THE COMPANY:
Edward J. Czajka
Executive Vice President
Chief Financial Officer
(213) 891-1188
AT FINANCIAL PROFILES:
Kristen Papke
General Information
(310) 663-8007
kpapke@finprofiles.com
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