Market Overview

Preferred Bank Reports Borrower Default


LOS ANGELES, April 30, 2018 (GLOBE NEWSWIRE) -- Preferred Bank (NASDAQ:PFBC), (the"Bank") an independent commercial bank, today reported that after substantial efforts to resolve a loan relationship, it had foreclosed on two (2) luxury 5-unit apartment properties in New York. The properties were new upon origination and the loans were originated in June of 2017 and July of 2017, respectively and are located on the Upper Eastside of Manahattan, below are the details:

General Location Current Loan Balance Appraised Value at Origination Loan-to-Value
E. 67th Street, NY $19,855,536 $31,600,000 62.8 %
E. 64th Street, NY $21,882,702 $32,000,000 68.4 %

In addition to those, the Bank may file foreclosure actions on two (2) luxury single family residential properties underlying loans made to the same individual as the managing member of separate LLC's. These loans were originated in March of 2017, below are the details:

General Location Current Loan Balance Appraised Value at Origination Loan-to-Value
Southhampton, NY $2,999,000 $5,000,000 60.0 %
Purchase, NY $2,600,000 $4,000,000 65.0 %

The Bank is currently working with a number of parties in order to bring this defaulted relationship to a satisfactory conclusion. Because of the current values of the underlying properties and the loan amounts outstanding, the Bank does not expect a material impact to its results of operations or financial condition.

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, Pico Rivera, Tarzana and San Francisco (2), 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 2016 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

AT THE COMPANY:           
Edward J. Czajka                     
Executive Vice President         
Chief Financial Officer            
(213) 891-1188

Kristen Papke
General Information
(425) 615-0051 

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