LOS ANGELES - Preferred Bank (NASDAQ:PFBC), a prominent independent commercial bank in California, announced today an increase in its quarterly cash dividend. The bank's Board of Directors has approved a rise from $0.70 to $0.75 per share, marking a 7.1% increase. This enhanced dividend is slated for payment on January 23, 2025, to shareholders who are on record as of January 9, 2025. According to InvestingPro data, this continues the bank's impressive track record of raising dividends for 4 consecutive years, with a current yield of 3.2%.
Preferred Bank operates from its main office in Los Angeles and maintains a network of branch offices across California, including locations such as Alhambra, Century City, and San Francisco, among others. It also has a presence in Flushing, New York, and Sugar Land, Texas. The bank offers a variety of deposit and loan services catering to commercial and consumer clients, ranging from real estate finance and commercial loans to trade finance. With a market capitalization of $1.16 billion and a P/E ratio of 8.6x, the bank has demonstrated strong financial performance, as highlighted in the comprehensive analysis available on InvestingPro.
The bank's customer base is diverse, initially founded to serve the Chinese-American community, but now it extends services to a broader mainstream market while continuing to benefit from the influx of ethnic Chinese from China and other East Asian regions.
This dividend increase reflects Preferred Bank's financial growth and commitment to providing value to its shareholders. The bank's operations include a loan production office in Sunnyvale, California, and a satellite office in Manhattan, New York, enabling it to offer personalized banking services to a wide range of customers, including small to mid-sized businesses, entrepreneurs, real estate developers, professionals, and individuals with high net worth.
The information for this report is based on a press release statement from Preferred Bank. The bank is chartered by the State of California and has its deposits insured by the Federal Deposit Insurance Corporation (FDIC) to the maximum extent permitted by law.
In other recent news, Preferred Bank posted strong Q3 results, with a net income of $33.6 million or $2.46 per share, showing significant loan growth and an improved net interest margin. The bank has also managed to successfully reduce non-performing loans with no charge-offs, achieving an interest recovery of $800,000. However, it experienced a rise in criticized loans and a slight decrease in deposits.
Financial services firm Stephens has maintained an Overweight rating on Preferred Bank, raising its price target from $90.00 to $94.00, following the bank's recent quarterly financial results. The new operating earnings per share (EPS) forecast for 2025 is set at $8.55, up from the previous $7.87 estimate, mainly due to a stronger-than-expected net interest margin (NIM) and net interest income (NII).
Despite a robust NIM performance in the third quarter, Stephens expects a decline in the fourth quarter. The anticipated moderation is attributed to the bank's certificate of deposit (CD) heavy deposit portfolio, which may take longer to reprice compared to the 74% of loans that are floating rate.
Looking ahead, Stephens predicts that NIM will begin to stabilize in the second half of 2025, with potential for modest expansion thereafter. Preferred Bank is expanding operations in strategic markets and hiring experienced bankers, indicating a robust strategy for future growth. These are some of the recent developments concerning Preferred Bank.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.