Preferred Bank Introduces $125 Million Stock Repurchase Plan
Preferred Bank Reveals Stock Buyback Initiative
Preferred Bank (NASDAQ: PFBC), one of California's leading independent commercial banks, has announced a significant development regarding its stock repurchase strategy. The shareholders have approved a new stock buyback plan valued at $125 million. This move highlights the Bank's commitment to enhancing shareholder value and reflects its robust financial health.
Completion of Previous Stock Repurchase Program
On May 8, 2025, the Bank successfully completed its prior stock repurchase initiative. This final segment of the $150 million program, authorized by shareholders in 2023, saw the repurchase of 818,059 shares, amounting to $65.7 million throughout the first two quarters of 2025. In total, the Bank repurchased 2,146,252 shares at an average price of $70.13 per share during this previous initiative.
Importance of the New Stock Buyback Plan
The newly approved $125 million stock buyback plan will require regulatory approval due to the Bank's unique corporate structure that lacks a holding company. Nevertheless, it is anticipated that these approvals will be acquired in a timely manner, enabling the Bank to follow through with its repurchase intentions.
Chairman’s Insights on Growth and Capital Management
Chairman and CEO Li Yu shared insights on the reasoning behind the buyback initiative, stating, "As organic growth has slowed, the Bank’s capital ratios will continue to climb due to our high level of profitability. In this setting, buying back our common stock is a great use of the Bank’s excess capital and an indirect way of returning capital to our shareholders." This sentiment underscores the Bank's strategic focus on creating value for its stakeholders.
About Preferred Bank
Preferred Bank is a prominent independent commercial bank based in California, chartered by the State of California. Its deposits are insured by the Federal Deposit Insurance Corporation (FDIC) to the extent permitted by law. The Bank operates from its main office in Los Angeles and has twelve full-service branch offices across several California cities including Alhambra, Century City, City of Industry, Torrance, and more. Additionally, it boasts branches in New York and a Loan Production Office in Sunnyvale, California.
The Bank's Services and Clientele
Preferred Bank offers a wide array of deposit and loan products tailored for both commercial and consumer clients. It aims to provide personalized banking services while focusing on real estate finance, commercial loans, and trade finance, particularly catering to small and medium-sized businesses, entrepreneurs, and high net worth individuals. Although originally established as a Chinese-American bank, it now serves a diverse clientele, benefitting from the ongoing migration of ethnic Chinese from East Asia to California.
Contact Information
AT THE COMPANY:
Edward J. Czajka
Executive Vice President
Chief Financial Officer
(213) 891-1188
AT FINANCIAL PROFILES:
Jeffrey Haas
General Information
(310) 622-8240
PFBC@finprofiles.com
Frequently Asked Questions
What is the total amount of the new stock repurchase plan?
The new stock repurchase plan is valued at $125 million.
How many shares did Preferred Bank repurchase in the last program?
In the last program, Preferred Bank repurchased a total of 2,146,252 shares.
Who approved the stock buyback plan?
The stock buyback plan was approved by the shareholders of Preferred Bank.
What is the primary reason for the stock buyback?
The buyback is intended to utilize excess capital and return value to shareholders amid slowed organic growth.
When did Preferred Bank complete its previous stock repurchase?
Preferred Bank completed its previous stock repurchase on May 8, 2025.
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