Headquartered in Los Angeles, Preferred Bank (NASDAQ: PFBC) (“Preferred” or “the bank”) is an FDIC designated minority depository institution strategically serving the Chinese American community, though the bank has been evolving into a mainstream bank over time (as of YE23, ethnic Chinese clients account for ~45% of deposits and ~20% of loans.)
Established in 1991, the bank currently operates 16 branches across the U.S., predominately located in SoCal, and, to lesser extent, NYC, San Francisco, and Houston multi-ethnicity metro regions. Preferred’s growth strategy has been largely organic in recent years.
The bank’s loan portfolio is commercially oriented, with investor CRE (including multi-family) constituting the largest segment, followed by C&I.
Key Credit Considerations
Preferred Bank’s ratings are underpinned by its solid bottom line profitability, primarily as the result of a robust NIM (4.46% for FY23) supported by a…
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