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LOS ANGELES, April 22, 2026 (GLOBE NEWSWIRE) -- Preferred Bank (NASDAQ: PFBC), one of the larger independent California banks, today reported results for the quarter ended March 31, 2026. Preferred Bank (“the Bank”) reported net income of $31.1 million or $2.53 per diluted share for the first quarter of 2026. This represents a decrease in net income of $3.7 million from the prior quarter and an increase of $1.1 million over the same quarter last year. The increase compared to last year was primarily due to an increase in net interest income of $2.7 million. The decrease in net income from the prior quarter was due to a decrease in net interest income of $4.7 million coupled with a decrease in noninterest income of $3.8 million. The primary reason for the decrease in net interest income was due to the reversal of interest on loans which were placed on nonaccrual status during the quarter. This was previously detailed in a press release on February 23, 2026. The decrease in noninterest income was due to a $3.6 million gain on sale of OREO recorded in the fourth quarter of 2025 which did not recur.
Highlights for the Quarter:
Li Yu, Chairman and CEO, commented, “Net income for the first quarter ending March 31, 2026, was $31.1 million or $2.53 per diluted share compared to $34.8 million or $2.79 per diluted share recorded in the previous quarter. This quarter’s net income was negatively affected by the Fed’s rate cuts and reversal of interest income related to a large relationship which was placed on nonaccrual status.
“During the first quarter, we disclosed that we placed $117.6 million in loans related to one relationship on nonaccrual status. We have made good progress towards resolving these loans as well as other nonaccrual loans. We sold a $9.4 million loan at par during the quarter and also charged off the $2.0 million in C&I loans related to this relationship. In addition, on April 1, we sold two loans totaling $48.5 million also at par so this sale will not be reflected as of March 31, 2026. We are continuing to work with note buyers to resolve more of these loans.
“Total non-performing assets at March 31, 2026, to $172.1million, an increase of $117.3 million over the $54.8 million as of December 31, 2025. However, the $48.5 million loan sold in April 2026, it was included in the total above but is now gone as of today.
“Loans for the quarter have increased $68.6 million or 4.5% annualized. Deposits increased $74.7 million or 4.7% annualized. Competition remains intense for both loans and deposits as pricing remains tight. The Bank’s net interest margin decreased to 3.57% for the quarter as compared to 3.74% for the previous quarter, the decrease entirely due to the reversal of interest income related to new non-accrual loans.
“During the first quarter, we repurchased 402,299 shares of our common stock for total consideration of $35.8 million as part of our ongoing $125 million stock repurchase plan which was approved by shareholders in May of 2025.”
Results of Operations
Net Interest Income and Net Interest Margin. Net interest income before provision for credit losses was $65.3 million for the first quarter of 2026. This represents a $4.7 million decrease from the $70.0 million recorded in the prior quarter and a $2.7 million increase over the same quarter last year. The decrease compared to the prior quarter was due mainly to a $3.4 million net interest reversal due to loans placed on nonaccrual status during the quarter. The increase in net interest income over the same quarter last year was due to an increase in loan interest and a small decrease in total interest expense. The Bank’s net interest margin (“NIM”) contracted in the quarter to 3.57% due to the interest reversals from 3.74% last quarter and down from the 3.75% net interest margin recorded in the first quarter of 2025. Without the interest reversals this quarter, the NIM would have been 3.75%.
Noninterest Income. For the first quarter of 2026, noninterest income was $4.3 million compared with $4.0 million for the same quarter last year and compared to $8.1 million for the fourth quarter of 2025. The increase over the same quarter last year was mainly due to increases in letter of credit (“LC”) fee income and other income partially offset by a decrease in gain on sales of loans and service charges on deposits. In comparison to the prior quarter, noninterest income was down primarily due to a $3.6 million gain on sale of OREO recorded in the fourth quarter of 2025.
Noninterest Expense. Total noninterest expense was $23.5 million for the first quarter of 2026 compared to $24.4 million for the fourth quarter of 2025 and compared to $23.4 million recorded in the same period last year. The primary reason for the decrease from the prior quarter was mainly due to a $3.1 million decrease in OREO expense partially offset by an increase in personnel expense of $2.4 million. The small increase over the same quarter last year was due to an increase in personnel expense of $621,000 and an increase in other expense of $876,000 partially offset by a decrease in OREO expense of $1.2 million. The Bank’s efficiency ratio came in at 33.8% for the quarter, which compares to 31.2% last quarter and to 35.1% in the same quarter last year.
Income Taxes. The Bank recorded a provision for income taxes of $13.4 million for the first quarter of 2026. This represents an effective tax rate (“ETR”) of 30.1% which is up from the 29.5% ETR for the same quarter last year and the same as the 29.5% ETR recorded in the fourth quarter of 2025. The Bank’s ETR will fluctuate slightly from quarter to quarter within a fairly small range due to the timing of taxable events throughout the year.
Balance Sheet Summary
Total gross loans at March 31, 2026 were $6.12 billion, an increase of $68.6 million from the total of $6.05 billion as of December 31, 2025. Total deposits were $6.42 billion, an increase of $74.7 million from the $6.35 billion as of December 31, 2025. Total assets were $7.65 billion, an increase of $53.5 million over the total of $7.60 billion as of December 31, 2025.
Asset Quality
Non-accrual loans and loans 90 days or more past due and still accruing totaled $169.1 million, an increase of $117.8 million over the $51.3 million reported as of December 31, 2025. The increase was from the previously mentioned large relationship that was placed on nonaccrual status during the first quarter. As previously mentioned, the Bank sold two of the nonaccrual notes totaling $48.5 million on April 1, 2026, at par so total nonperforming loans are $120.6 million as of this writing. Total net charge-offs (recoveries) on loans for the quarter were $5.5 million compared to $0 in the prior quarter and compared to net recoveries of ($97,000) in the first quarter of 2025. Total classified assets decreased to $171.7 million as of March 31, 2026 compared to $225.3 million as of December 31, 2025. The table below lists the Bank’s nonperforming loans and their associated property appraised values:
| C&I | SFR | CRE | Total | |||||||||||
| Balance | Appraised Value | Balance | Appraised Value | Balance | Appraised Value | Balance | Appraised Value | |||||||
| $ | 4,519,590 | $ | 461,638 | $ | 780,000 | $ | 649,036 | $ | 1,550,000 | |||||
| 46,156 | 144,542 | 1,275,000 | 4,037,500 | 4,250,000 | ||||||||||
| 63,744 | 924,624 | 1,308,000 | 3,690,251 | 6,260,000 | ||||||||||
| 3,526 | 658,067 | 967,246 | 6,265,056 | 7,100,000 | ||||||||||
| 19,500,000 | 48,300,000 | |||||||||||||
| 19,950,000 | 41,300,000 | |||||||||||||
| 48,458,994 | 65,650,000 | |||||||||||||
| 29,882,035 | 67,230,000 | |||||||||||||
| 7,914,950 | 12,890,000 | |||||||||||||
| 21,881,109 | 27,000,000 | |||||||||||||
| $ | 4,633,016 | $ | 2,188,871 | $ | 4,330,246 | $ | 162,228,931 | $ | 281,530,000 | $ | 169,050,818 | $ | 285,860,246 | |
| Note: | ||||||||||||||
| 1) Weighted LTV: 57.5% (Total Nonperforming Loans / Total Appraisal Value) | ||||||||||||||
| 2) $48.5 million CRE sold at par on 4/1/26 | ||||||||||||||
Allowance for Credit Losses
The provision for credit losses for the first quarter of 2026 was $1.5 million compared to $4.3 million in the prior quarter and compared to $700,000 in the same quarter last year. The Bank’s allowance coverage ratio was 1.24% of total loans held for investment compared to 1.30% last quarter and compared to 1.28% in the first quarter of 2025.
Capitalization
As of March 31, 2026, the Bank’s tangible common equity ratio was 10.05%, the leverage ratio was 10.37%, the common equity tier 1 capital ratio was 10.87% and the total capital ratio stood at 13.98%. As of December 31, 2025, the Bank’s tangible common equity ratio was 10.38%, the Bank’s leverage ratio was 10.54%, the common equity tier 1 ratio was 11.26% and the total capital ratio was 14.47%.
Conference Call and Webcast
A conference call with simultaneous webcast to discuss Preferred Bank’s first quarter 2026 financial results will be held this afternoon, April 22, 2026 at 2:00 p.m. Eastern / 11:00 a.m. Pacific. Interested participants and investors may access the conference call by dialing 844-826-3037 (domestic) or 412-317-5182 (international) and referencing “Preferred Bank.” There will also be a live webcast of the call available at the Investor Relations section of Preferred Bank's website at www.preferredbank.com.
Preferred Bank's Chairman and CEO Li Yu, President and Chief Operating Officer Wellington Chen, Chief Financial Officer Edward J. Czajka, and Deputy Chief Operating Officer Johnny Hsu will discuss Preferred Bank's financial results, business highlights and outlook. After the live webcast, a replay will be available at the Investor Relations section of Preferred Bank's website. A replay of the call will also be available at 855-669-9658 (domestic) or 412-317-0088 (international) through February 5, 2026; the passcode is 4064016.
About Preferred Bank
Preferred Bank is one of the larger independent commercial banks headquartered 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 Bank conducts its banking business from its main office in Los Angeles, California, and through twelve full-service branch banking offices in California (Alhambra, Century City, City of Industry, Torrance, Arcadia, Irvine (2), Diamond Bar, Pico Rivera, Tarzana and San Francisco (2)), two branches in New York (Manhattan and Flushing, Queens) and a branch office in the Houston, Texas suburb of Sugar Land. In addition, the Bank also operates a loan production office in Sunnyvale, California. 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 2025 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: | AT FINANCIAL PROFILES: |
| Edward J. Czajka | Evan Niu |
| Executive Vice President | General Information |
| Chief Financial Officer | (310) 622-8243 |
| (213) 891-1188 | PFBC@finprofiles.com |
Financial Tables to Follow
| PREFERRED BANK | ||||||||
| Condensed Consolidated Statements of Operations | ||||||||
| (unaudited) | ||||||||
| (in thousands, except for net income per share and shares) | ||||||||
| For the Quarter Ended | ||||||||
| March 31, | December 31, | March 31, | ||||||
| 2026 | 2025 | 2025 | ||||||
| Interest income: | ||||||||
| Loans, including fees | $ | 103,382 | $ | 109,747 | $ | 101,491 | ||
| Investment securities | 13,301 | 14,677 | 12,810 | |||||
| Fed funds sold | 192 | 209 | 228 | |||||
| Total interest income | 116,875 | 124,633 | 114,529 | |||||
| Interest expense: | ||||||||
| Interest-bearing demand | 15,120 | 16,952 | 16,590 | |||||
| Savings | 54 | 55 | 69 | |||||
| Time certificates | 33,373 | 34,543 | 33,887 | |||||
| FHLB borrowings | 1,690 | 1,783 | - | |||||
| Subordinated debt | 1,325 | 1,325 | 1,325 | |||||
| Total interest expense | 51,562 | 54,658 | 51,871 | |||||
| Net interest income | 65,313 | 69,975 | 62,658 | |||||
| Provision for credit losses | 1,500 | 4,300 | 700 | |||||
| Net interest income after provision for credit losses | 63,813 | 65,675 | 61,958 | |||||
| Noninterest income: | ||||||||
| Fees & service charges on deposit accounts | 516 | 545 | 716 | |||||
| Letters of credit fee income | 2,737 | 2,408 | 2,244 | |||||
| BOLI income | 105 | 105 | 103 | |||||
| Net gain on sale of other real estate owned | - | 3,609 | - | |||||
| Net gain on called and sale of investment securities | 59 | 132 | - | |||||
| Net gain on sale of loans | 24 | 93 | 275 | |||||
| Other income | 869 | 1,202 | 660 | |||||
| Total noninterest income | 4,310 | 8,094 | 3,998 | |||||
| Noninterest expense: | ||||||||
| Salary and employee benefits | 15,460 | 13,101 | 14,839 | |||||
| Net occupancy expense | 2,426 | 2,430 | 2,294 | |||||
| Business development and promotion expense | 203 | 163 | 462 | |||||
| Professional services | 1,647 | 2,091 | 1,651 | |||||
| Office supplies and equipment expense | 358 | 375 | 386 | |||||
| OREO valuation allowance and related expense | 363 | 3,465 | 1,531 | |||||
| Other | 3,082 | 2,752 | 2,206 | |||||
| Total noninterest expense | 23,539 | 24,377 | 23,369 | |||||
| Income before provision for income taxes | 44,584 | 49,392 | 42,587 | |||||
| Income tax expense | 13,440 | 14,570 | 12,563 | |||||
| Net income | $ | 31,144 | $ | 34,822 | $ | 30,024 | ||
| Income per share available to common shareholders | ||||||||
| Basic | $ | 2.57 | $ | 2.85 | $ | 2.27 | ||
| Diluted | $ | 2.53 | $ | 2.79 | $ | 2.23 | ||
| Weighted-average common shares outstanding | ||||||||
| Basic | 12,105,359 | 12,210,077 | 13,226,582 | |||||
| Diluted | 12,292,237 | 12,479,124 | 13,453,176 | |||||
| Cash dividends per common share | $ | 0.80 | $ | 0.80 | $ | 0.75 | ||
| PREFERRED BANK | |||||||
| Condensed Consolidated Statements of Financial Condition | |||||||
| (unaudited) | |||||||
| (in thousands) | |||||||
| March 31, | December 31, | ||||||
| 2026 | 2025 | ||||||
| (Unaudited) | (Audited) | ||||||
| Assets | |||||||
| Cash and due from banks | $ | 805,161 | $ | 807,098 | |||
| Fed funds sold | 20,000 | 20,000 | |||||
| Cash and cash equivalents | 825,161 | 827,098 | |||||
| Securities held-to-maturity, at amortized cost | 18,458 | 18,749 | |||||
| Securities available-for-sale, at fair value | 553,184 | 566,186 | |||||
| Loans held for sale, at lower of cost or fair value | 76,324 | - | |||||
| Loans | 6,046,544 | 6,054,264 | |||||
| Less allowance for credit losses | (75,036 | ) | (78,992 | ) | |||
| Less amortized deferred loan fees, net | (7,923 | ) | (9,030 | ) | |||
| Loans, net | 5,963,585 | 5,966,242 | |||||
| Other real estate owned and repossessed assets | 3,010 | 3,510 | |||||
| Bank furniture and fixtures, net | 8,972 | 8,064 | |||||
| Bank-owned life insurance | 10,782 | 10,712 | |||||
| Accrued interest receivable | 34,811 | 34,233 | |||||
| Investment in affordable housing partnerships | 66,394 | 69,978 | |||||
| Federal Home Loan Bank stock, at cost | 15,000 | 15,000 | |||||
| Deferred tax assets | 43,492 | 41,976 | |||||
| Income tax receivable | - | 3,884 | |||||
| Operating lease right-of-use assets | 29,593 | 30,531 | |||||
| Other assets | 5,871 | 5,002 | |||||
| Total assets | $ | 7,654,637 | $ | 7,601,165 | |||
| Liabilities and Shareholders' Equity | |||||||
| Deposits: | |||||||
| Noninterest bearing demand deposits | $ | 716,777 | $ | 699,160 | |||
| Interest bearing deposits: | 2,200,374 | 2,205,914 | |||||
| Savings | 26,822 | 30,376 | |||||
| Time certificates of $250,000 or more | 1,795,883 | 1,754,273 | |||||
| Other time certificates | 1,680,291 | 1,655,723 | |||||
| Total deposits | 6,420,147 | 6,345,446 | |||||
| Advances from Federal Home Loan Bank | 200,000 | 200,000 | |||||
| Subordinated debt issuance, net | 148,766 | 148,706 | |||||
| Commitments to fund investment in affordable housing partnerships | 18,873 | 23,327 | |||||
| Operating lease liabilities | 34,383 | 35,107 | |||||
| Accrued interest payable | 16,754 | 16,513 | |||||
| Other liabilities | 45,515 | 42,589 | |||||
| Total liabilities | 6,884,438 | 6,811,688 | |||||
| Shareholders' equity | 770,199 | 789,477 | |||||
| Total liabilities and shareholders' equity | $ | 7,654,637 | $ | 7,601,165 | |||
| Book value per common share | $ | 65.04 | $ | 64.83 | |||
| Number of common shares outstanding | 11,841,866 | 12,177,588 | |||||
| PREFERRED BANK | |||||||||||||||||||
| Selected Consolidated Financial Information | |||||||||||||||||||
| (unaudited) | |||||||||||||||||||
| (in thousands, except for ratios) | |||||||||||||||||||
| For the Quarter Ended | |||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
| 2026 | 2025 | 2025 | 2025 | 2025 | |||||||||||||||
| Unaudited historical quarterly operations data: | |||||||||||||||||||
| Interest income | $ | 116,875 | $ | 124,633 | $ | 126,850 | $ | 120,443 | $ | 114,529 | |||||||||
| Interest expense | 51,562 | 54,658 | 55,540 | 53,569 | 51,871 | ||||||||||||||
| Interest income before provision for credit losses | 65,313 | 69,975 | 71,310 | 66,874 | 62,658 | ||||||||||||||
| Provision for credit losses | 1,500 | 4,300 | 2,500 | 1,600 | 700 | ||||||||||||||
| Noninterest income | 4,310 | 8,094 | 3,665 | 3,762 | 3,998 | ||||||||||||||
| Noninterest expense | 23,539 | 24,377 | 21,498 | 22,445 | 23,369 | ||||||||||||||
| Income tax expense | 13,440 | 14,570 | 15,038 | 13,744 | 12,563 | ||||||||||||||
| Net income | $ | 31,144 | $ | 34,822 | $ | 35,939 | $ | 32,847 | $ | 30,024 | |||||||||
| Earnings per share | |||||||||||||||||||
| Basic | $ | 2.57 | $ | 2.85 | $ | 2.90 | $ | 2.61 | $ | 2.27 | |||||||||
| Diluted | $ | 2.53 | $ | 2.79 | $ | 2.84 | $ | 2.57 | $ | 2.23 | |||||||||
| Ratios for the period: | |||||||||||||||||||
| Return on average assets | 1.67 | % | 1.82 | % | 1.93 | % | 1.85 | % | 1.76 | % | |||||||||
| Return on average equity | 15.89 | % | 17.59 | % | 18.64 | % | 17.55 | % | 15.62 | % | |||||||||
| Net interest margin (Fully-taxable equivalent) | 3.57 | % | 3.74 | % | 3.92 | % | 3.85 | % | 3.75 | % | |||||||||
| Noninterest expense to average assets | 1.26 | % | 1.27 | % | 1.16 | % | 1.26 | % | 1.37 | % | |||||||||
| Efficiency ratio | 33.81 | % | 31.22 | % | 28.67 | % | 31.78 | % | 35.06 | % | |||||||||
| Net charge-offs (recoveries) to average loans (annualized) | 0.37 | % | 0.00 | % | 0.11 | % | 0.00 | % | -0.01 | % | |||||||||
| Ratios as of period end: | |||||||||||||||||||
| Tangible common equity ratio | 10.05 | % | 10.38 | % | 10.38 | % | 10.26 | % | 10.96 | % | |||||||||
| Tier 1 leverage capital ratio | 10.37 | % | 10.54 | % | 10.66 | % | 10.73 | % | 11.52 | % | |||||||||
| Common equity tier 1 risk-based capital ratio | 10.87 | % | 11.26 | % | 11.34 | % | 11.18 | % | 11.86 | % | |||||||||
| Tier 1 risk-based capital ratio | 10.87 | % | 11.26 | % | 11.34 | % | 11.18 | % | 11.86 | % | |||||||||
| Total risk-based capital ratio | 13.98 | % | 14.47 | % | 14.56 | % | 14.43 | % | 15.15 | % | |||||||||
| Allowances for credit losses to loans at end of period | 1.24 | % | 1.30 | % | 1.27 | % | 1.29 | % | 1.28 | % | |||||||||
| Allowance for credit losses to non-performing loans | 0.8x | 1.54x | 4.24x | 1.41x | 0.91x | ||||||||||||||
| Average balances: | |||||||||||||||||||
| Total securities | $ | 580,248 | $ | 586,950 | $ | 583,302 | $ | 503,861 | $ | 402,754 | |||||||||
| Total loans | 6,037,241 | 5,947,814 | 5,753,801 | 5,623,010 | 5,555,010 | ||||||||||||||
| Total earning assets | 7,437,232 | 7,439,767 | 7,234,568 | 6,984,272 | 6,780,438 | ||||||||||||||
| Total assets | 7,563,705 | 7,585,940 | 7,382,265 | 7,121,047 | 6,905,249 | ||||||||||||||
| Total time certificate of deposits | 3,451,924 | 3,402,304 | 3,330,241 | 3,321,327 | 3,164,766 | ||||||||||||||
| Total interest bearing deposits | 5,644,722 | 5,651,369 | 5,501,767 | 5,345,308 | 5,244,243 | ||||||||||||||
| Total deposits | 6,311,446 | 6,336,242 | 6,169,728 | 6,005,486 | 5,886,163 | ||||||||||||||
| Total interest bearing liabilities | 5,993,452 | 6,000,042 | 5,850,376 | 5,614,737 | 5,392,735 | ||||||||||||||
| Total equity | 794,931 | 785,581 | 764,766 | 750,535 | 779,339 | ||||||||||||||
| PREFERRED BANK | |||||||||||||||||||
| Selected Consolidated Financial Information | |||||||||||||||||||
| (unaudited) | |||||||||||||||||||
| (in thousands, except for ratios) | |||||||||||||||||||
| As of | |||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
| 2026 | 2025 | 2025 | 2025 | 2025 | |||||||||||||||
| Unaudited quarterly statement of financial position data: | |||||||||||||||||||
| Assets: | |||||||||||||||||||
| Cash and cash equivalents | $ | 825,161 | $ | 827,098 | $ | 815,459 | $ | 796,257 | $ | 925,183 | |||||||||
| Securities held-to-maturity, at amortized cost | 18,458 | 18,749 | 19,034 | 19,456 | 19,745 | ||||||||||||||
| Securities available-for-sale, at fair value | 553,184 | 566,186 | 569,115 | 577,040 | 390,096 | ||||||||||||||
| Loans: | |||||||||||||||||||
| Real estate – Mortgage: | |||||||||||||||||||
| Real estate—Residential | $ | 738,508 | $ | 783,136 | $ | 793,217 | $ | 767,620 | $ | 779,462 | |||||||||
| Real estate—Commercial | 3,105,331 | 3,028,762 | 2,890,990 | 2,868,308 | 2,897,956 | ||||||||||||||
| Total Real Estate – Mortgage | 3,843,839 | 3,811,898 | 3,684,207 | 3,635,928 | 3,677,418 | ||||||||||||||
| Real estate – Construction: | |||||||||||||||||||
| R/E Construction — Residential | 265,748 | 282,808 | 285,623 | 291,343 | 306,283 | ||||||||||||||
| R/E Construction — Commercial | 343,598 | 387,759 | 323,897 | 303,354 | 269,065 | ||||||||||||||
| Total real estate construction loans | 609,346 | 670,567 | 609,520 | 594,697 | 575,348 | ||||||||||||||
| Commercial and industrial | 1,584,984 | 1,563,504 | 1,570,423 | 1,501,188 | 1,374,379 | ||||||||||||||
| SBA | 8,087 | 8,053 | 7,630 | 7,741 | 7,104 | ||||||||||||||
| Consumer and others | 288 | 242 | 231 | 56 | 164 | ||||||||||||||
| Gross loans | 6,046,544 | 6,054,264 | 5,872,011 | 5,739,610 | 5,634,413 | ||||||||||||||
| Allowance for credit losses on loans | (75,036 | ) | (78,992 | ) | (74,692 | ) | (73,830 | ) | (72,274 | ) | |||||||||
| Net deferred loan fees | (7,923 | ) | (9,030 | ) | (9,956 | ) | (11,940 | ) | (9,652 | ) | |||||||||
| Net loans, excluding loans held for sale | $ | 5,963,585 | $ | 5,966,242 | $ | 5,787,363 | $ | 5,653,840 | $ | 5,552,487 | |||||||||
| Loans held for sale | $ | 76,324 | $ | - | $ | - | $ | - | $ | - | |||||||||
| Net loans | $ | 6,039,909 | $ | 5,966,242 | $ | 5,787,363 | $ | 5,653,840 | $ | 5,552,487 | |||||||||
| Other real estate owned and repossessed assets | $ | 3,010 | $ | 3,510 | $ | 52,609 | $ | 13,755 | $ | 13,650 | |||||||||
| Investment in affordable housing partnerships | 66,394 | 69,978 | 73,874 | 74,783 | 63,612 | ||||||||||||||
| Federal Home Loan Bank stock, at cost | 15,000 | 15,000 | 15,000 | 15,000 | 15,000 | ||||||||||||||
| Other assets | 133,521 | 134,402 | 135,340 | 128,629 | 120,319 | ||||||||||||||
| Total assets | $ | 7,654,637 | $ | 7,601,165 | $ | 7,467,794 | $ | 7,278,760 | $ | 7,100,092 | |||||||||
| Liabilities: | |||||||||||||||||||
| Deposits: | |||||||||||||||||||
| Demand | $ | 716,777 | $ | 699,160 | $ | 654,302 | $ | 675,102 | $ | 730,270 | |||||||||
| Interest bearing demand | 2,200,374 | 2,205,914 | 2,205,865 | 2,004,135 | 2,099,987 | ||||||||||||||
| Savings | 26,822 | 30,376 | 31,087 | 34,333 | 32,631 | ||||||||||||||
| Time certificates of $250,000 or more | 1,795,883 | 1,754,273 | 1,699,757 | 1,681,026 | 1,531,715 | ||||||||||||||
| Other time certificates | 1,680,291 | 1,655,723 | 1,638,662 | 1,683,737 | 1,678,132 | ||||||||||||||
| Total deposits | $ | 6,420,147 | $ | 6,345,446 | $ | 6,229,673 | $ | 6,078,333 | $ | 6,072,735 | |||||||||
| Advance from Federal Home Loan Bank | 200,000 | 200,000 | 200,000 | 200,000 | - | ||||||||||||||
| Subordinated debt issuance, net | 148,766 | 148,706 | 148,647 | 148,588 | 148,529 | ||||||||||||||
| Commitments to fund investment in affordable housing partnerships | 18,873 | 23,327 | 24,874 | 30,645 | 20,956 | ||||||||||||||
| Other liabilities | 96,652 | 94,209 | 88,958 | 73,534 | 79,268 | ||||||||||||||
| Total liabilities | $ | 6,884,438 | $ | 6,811,688 | $ | 6,692,152 | $ | 6,531,100 | $ | 6,321,488 | |||||||||
| Equity: | |||||||||||||||||||
| Common stock, no par value | $ | 210,882 | $ | 210,882 | $ | 210,882 | $ | 210,882 | $ | 210,882 | |||||||||
| Additional paid-in capital | 108,853 | 105,105 | 103,235 | 101,088 | 99,603 | ||||||||||||||
| Treasury stock | (334,490 | ) | (293,406 | ) | (277,351 | ) | (271,005 | ) | (214,406 | ) | |||||||||
| Retained earnings | 802,308 | 780,637 | 755,587 | 728,891 | 705,360 | ||||||||||||||
| Accumulated other comprehensive income | (17,354 | ) | (13,741 | ) | (16,711 | ) | (22,196 | ) | (22,835 | ) | |||||||||
| Total shareholders' equity | $ | 770,199 | $ | 789,477 | $ | 775,642 | $ | 747,660 | $ | 778,604 | |||||||||
| Total liabilities and shareholders' equity | $ | 7,654,637 | $ | 7,601,165 | $ | 7,467,794 | $ | 7,278,760 | $ | 7,100,092 | |||||||||
| PREFERRED BANK | |||||||||||||||||||||||
| QUARTER-TO-DATE AVERAGE BALANCES, YIELD AND RATES | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three months ended March 31, | Three months ended December 31, | Three months ended March 31, | |||||||||||||||||||||
| 2026 | 2025 | 2025 | |||||||||||||||||||||
| Interest | Average | Interest | Average | Interest | Average | ||||||||||||||||||
| Average | Income or | Yield/ | Average | Income or | Yield/ | Average | Income or | Yield/ | |||||||||||||||
| Balance | Expense | Rate | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||
| ASSETS | (Dollars in thousands) | ||||||||||||||||||||||
| Interest earning assets: | |||||||||||||||||||||||
| Loans(1,2) | $ | 6,051,465 | $ | 103,382 | 6.93 | % | $ | 5,947,986 | $ | 109,747 | 7.32 | % | $ | 5,556,521 | $ | 101,491 | 7.41 | % | |||||
| Investment securities(3) | 580,248 | 5,712 | 3.99 | % | 586,950 | 5,883 | 3.98 | % | 402,754 | 4,093 | 4.12 | % | |||||||||||
| Federal funds sold | 20,507 | 192 | 3.80 | % | 20,337 | 209 | 4.08 | % | 20,222 | 228 | 4.57 | % | |||||||||||
| Other earning assets | 785,012 | 7,681 | 3.97 | % | 884,494 | 8,886 | 3.99 | % | 800,941 | 8,816 | 4.46 | % | |||||||||||
| Total interest earning assets | 7,437,232 | 116,967 | 6.38 | % | 7,439,767 | 124,725 | 6.65 | % | 6,780,438 | 114,628 | 6.86 | % | |||||||||||
| Deferred loan fees, net | (8,334 | ) | (9,739 | ) | (9,189 | ) | |||||||||||||||||
| Allowance for credit losses on loans | (78,986 | ) | (74,738 | ) | (71,550 | ) | |||||||||||||||||
| Noninterest earning assets: | |||||||||||||||||||||||
| Cash and due from banks | 10,685 | 11,055 | 11,513 | ||||||||||||||||||||
| Bank furniture and fixtures | 8,509 | 7,887 | 8,439 | ||||||||||||||||||||
| Right of use assets | 30,195 | 28,344 | 15,201 | ||||||||||||||||||||
| Other assets | 164,404 | 183,364 | 170,397 | ||||||||||||||||||||
| Total assets | $ | 7,563,705 | $ | 7,585,940 | $ | 6,905,249 | |||||||||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||||||||||||
| Interest bearing liabilities: | |||||||||||||||||||||||
| Deposits: | |||||||||||||||||||||||
| Interest bearing demand and savings | $ | 2,192,798 | $ | 15,174 | 2.81 | % | $ | 2,249,065 | $ | 17,007 | 3.00 | % | $ | 2,079,477 | $ | 16,659 | 3.25 | % | |||||
| TCD $250K or more | 1,773,086 | 16,886 | 3.86 | % | 1,725,674 | 17,220 | 3.96 | % | 1,482,324 | 15,640 | 4.28 | % | |||||||||||
| Other time certificates | 1,678,838 | 16,487 | 3.98 | % | 1,676,630 | 17,323 | 4.10 | % | 1,682,442 | 18,247 | 4.40 | % | |||||||||||
| Total interest bearing deposits | 5,644,722 | 48,547 | 3.49 | % | 5,651,369 | 51,551 | 3.62 | % | 5,244,243 | 50,546 | 3.91 | % | |||||||||||
| Advance from Federal Home Loan Bank | 200,000 | 1,690 | 3.43 | % | 200,000 | 1,783 | 3.54 | % | - | - | 0.00 | % | |||||||||||
| Subordinated debt, net | 148,728 | 1,325 | 3.61 | % | 148,673 | 1,325 | 3.54 | % | 148,492 | 1,325 | 3.62 | % | |||||||||||
| Total interest bearing liabilities | 5,993,452 | 51,562 | 3.49 | % | 6,000,042 | 54,658 | 3.61 | % | 5,392,735 | 51,871 | 3.90 | % | |||||||||||
| Noninterest bearing liabilities: | |||||||||||||||||||||||
| Demand deposits | 666,724 | 684,873 | 641,920 | ||||||||||||||||||||
| Lease liability | 34,885 | 32,626 | 18,963 | ||||||||||||||||||||
| Other liabilities | 73,713 | 82,818 | 72,292 | ||||||||||||||||||||
| Total liabilities | 6,768,774 | 6,800,359 | 6,125,910 | ||||||||||||||||||||
| Shareholders’ equity | 794,931 | 785,581 | 779,339 | ||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 7,563,705 | $ | 7,585,940 | $ | 6,905,249 | |||||||||||||||||
| Net interest income | $ | 65,405 | $ | 70,067 | $ | 62,757 | |||||||||||||||||
| Net interest spread | 2.89 | % | 3.04 | % | 2.96 | % | |||||||||||||||||
| Net interest margin | 3.57 | % | 3.74 | % | 3.75 | % | |||||||||||||||||
| Cost of Deposits: | |||||||||||||||||||||||
| Noninterest bearing demand deposits | $ | 666,724 | $ | 684,873 | $ | 641,920 | |||||||||||||||||
| Interest bearing deposits | 5,644,722 | 48,547 | 3.49 | % | 5,651,369 | 51,551 | 3.62 | % | 5,244,243 | 50,546 | 3.91 | % | |||||||||||
| Total Deposits | $ | 6,311,446 | $ | 48,547 | 3.12 | % | $ | 6,336,242 | $ | 51,551 | 3.23 | % | $ | 5,886,163 | $ | 50,546 | 3.48 | % | |||||
| 1) Includes non-accrual loans and loans held for sale | |||||||||||||||||||||||
| 2) Net loan fee income of $1.2 million, $1.4 million and $865,000 or the quarter ended March 31, 2026, December 31, 2025 and March 31, 2025, respectively, are included in the yield computations | |||||||||||||||||||||||
| 3) Yields on securities have been adjusted to a tax-equivalent basis | |||||||||||||||||||||||
| Preferred Bank | |||||||
| Loan and Credit Quality Information | |||||||
| Allowance For Credit Losses History | |||||||
| Quarter Ended | Year Ended | ||||||
| March 31, 2026 | December 31, 2025 | ||||||
| (Dollars in 000's) | |||||||
| Allowance For Credit Losses | |||||||
| Balance at Beginning of Period | $ | 78,992 | $ | 71,477 | |||
| Charge-Offs | |||||||
| Commercial & Industrial | 2,545 | 8 | |||||
| Mini-perm Real Estate | 3,833 | 1,749 | |||||
| Total Charge-Offs | 6,378 | 1,757 | |||||
| Recoveries | |||||||
| Commercial & Industrial | 73 | 172 | |||||
| Mini-perm Real Estate | 849 | - | |||||
| Total Recoveries | 922 | 172 | |||||
| Net Charge-Offs | 5,456 | 1,585 | |||||
| Provision for Credit Losses: | 1,500 | 9,100 | |||||
| Balance at End of Period | $ | 75,036 | $ | 78,992 | |||
| Average Loans Held for Investment | $ | 6,037,241 | $ | 5,721,077 | |||
| Loans Held for Investment at End of Period | $ | 6,046,544 | $ | 6,054,264 | |||
| Net Charge-Offs to Average Loans | 0.37 | % | 0.03 | % | |||
| Allowances for Credit Losses to Loans at End of Period | 1.24 | % | 1.30 | % | |||
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