Center Financial Reports Solid Loan Growth for 2007 First Quarter.Company's Asset Quality Maintained at Excellent Levels LOS ANGELES Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. -- Center Financial Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CLFC CLFC Creating Lasting Family Connections (New Hampshire) CLFC Clear Lake Fencing Club (Texas) ), the holding company of Center Bank, today reported financial results for the three months ended March 31, 2007, and posted another quarter of steady growth in net loans while maintaining excellent asset quality. 2007 first quarter highlights include: * Net loans increased by $42.6 million to $1.58 billion from Q4 2006; up 30% from Q1 2006 * Net loans represented 84.4% of total assets, versus 83.4% at year-end 2006 * Provision for loan loss of $1.3 million, compared with $257,000 in Q1 2006 * Allowance for loan loss maintained at 1.12% * Total non-performing assets of $3.9 million, or 0.24% of total loans, versus $3.3 million, or 0.21% of total loans, at December 31, 2006 * Non-interest bearing deposits stable at 27% of total deposits * Company did not sell any of its loans held for sale, compared with a gain on sale of loans of $674,000 posted in Q1 2006, and $714,000 in Q4 2006 * Net income totaled $5.9 million, or $0.35 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared with $5.8 million, or $0.35 per diluted share, for Q1 2006 * Net interest margin narrowed to 4.39% from 4.40% for Q1 2006 * Efficiency ratio improved to 51.9%, compared with 55.8% for Q1 2006 * Return on average assets equaled 1.29%, compared with 1.47% for Q1 2006 * Return on average equity equaled 16.43%, versus 19.43% for Q1 2006 * Quarterly cash dividend of $0.04 per share "I am pleased with the steadfast performance of Center Bank's entire team, particularly given the difficult operating environment In computing, an operating environment is the environment in which users run programs, whether in a command line interface, such as in MS-DOS or the Unix shell, or in a graphical user interface, such as in the Macintosh operating system. characterized char·ac·ter·ize tr.v. character·ized, character·iz·ing, character·iz·es 1. To describe the qualities or peculiarities of: characterized the warden as ruthless. 2. by strong competition from both the ethnic and mainstream institutions for quality loans and deposits," said Jae Whan (J.W.) Yoo, president and chief executive officer. "Working through the challenges that also included a transitional period at the executive management level during the first quarter, we maintained our focus and worked cohesively to deliver another quarter of solid net loan growth while preserving the integrity of our loan portfolio." For the three months ended March 31, 2007, net interest income before provision for loan losses rose 12% to $18.6 million from $16.7 million in the 2006 first quarter, reflecting the growth in the company's earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin driven by loan production, partially offset by considerably higher interest expense on borrowed funds. The company's yield on interest-earning assets averaged 8.02% for the three months ended March 31, 2007, compared with 7.54% in the 2006 first quarter. The net interest margin for the 2007 first quarter narrowed to 4.39% from 4.50% in the preceding fourth quarter and from 4.40% in the year-ago first quarter. The company's provision for loan losses increased to $1.3 million in the 2007 first quarter, versus $257,000 in the prior-year's first quarter. Allowance for loan losses to gross loans was maintained at 1.12% for the current first quarter, equal to the same level throughout 2006. Noninterest income in the first quarter of 2007 narrowed to $3.7 million from $5.0 million in the year-ago period. In the current period, the company did not sell any of its loans held for sale, electing to retain the assets for future sales. In the year-ago period, Center Financial posted a gain on sale of loans of $674,000. In addition, the intentional in·ten·tion·al adj. 1. Done deliberately; intended: an intentional slight. See Synonyms at voluntary. 2. Having to do with intention. closure of higher risk operating accounts that, while generating service charges, were deemed inconsistent with the company's risk management policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental resulted in a general decline in account and service related fees. Noninterest expense for the 2007 first quarter declined 5% to $11.5 million from $12.1 million a year earlier, principally reflecting lower professional service fees incurred in the current period versus the same period a year ago in which the company posted a non-recurring consulting fee of $1.4 million related to a concentrated effort to strengthen its BSA 1. BSA - Business Software Alliance. 2. BSA - Bidouilleurs Sans Argent. infrastructure. The company's efficiency ratio improved to 51.9% for the three months ended March 31, 2007 from 55.8% for the same period in 2006. Net income for the 2007 first quarter totaled $5.9 million, or $0.35 per diluted share, compared with $5.8 million, or $0.35 per diluted share, in the corresponding period a year ago. Return on average assets and return on average equity decreased to 1. 29% and 16.43%, respectively, for the three months ended March 31, 2007, compared with 1.36% and 17.88%, respectively, for the three months ended December 31, 2006, and 1.47% and 19.43% during the first quarter of 2006. Gross loans at March 31, 2007 rose 3% sequentially to $1.60 billion from $1.56 billion at year-end 2006 and reflected an increase of 30% over the year-ago first quarter. As of March 31, 2007, commercial real estate loans continued to represent the largest component of the company's total loan portfolio, accounting for 66% of total loans, compared with 67% at year-end 2006. Real estate construction loans increased by $10.0 million over December 31, 2006 and accounted for 3% of total loans at March 31, 2007. Commercial and industrial loans, including commercial, trade finance and SBA SBA abbr. Small Business Administration Noun 1. SBA - an independent agency of the United States government that protects the interests of small businesses and ensures that they receive a fair share of government loans, represented 26%, and consumer loans totaled 5% of the gross loan portfolio at the end of the 2007 first quarter. The company continued to maintain excellent asset quality with total non-performing assets of $3.9 million, or 0.24% of total loans, at March 31, 2007, compared with $3.3 million, or 0.21% of total loans, at December 31, 2006. Net charge-offs in the 2007 first quarter amounted to $857,000, compared with $516,000 in the 2006 fourth quarter and $239,000 in year-ago first quarter. The allowance for loan losses increased to $17.9 million, or 1.12% of gross loans, at March 31, 2007, reflecting the continued expansion of the company's loan portfolio. This compares with allowance for losses of $17.4 million, or 1.12% of gross loans, at December 31, 2006. Total deposits were modestly higher at $1.44 billion at March 31, 2007, compared with $1.43 billion at year-end 2006. Non-interest bearing deposits of $389.4 million at the close of the 2007 first quarter represented 27% of total deposits, equal to the same level at year-end 2006. Total time deposits accounted for 55% of total deposits at March 31, 2007, versus 54% at December 31, 2006. Net loans as a percentage of total assets increased to 84.4% at March 31, 2007, compared with 83.4% at year-end 2006. The company's loan-to-deposit ratio at the end of the 2007 first quarter rose to 109.5% from 107.5% at December 31, 2006. The average cost of interest-bearing deposits for the first quarter of 2007 increased to 4.68% from 4.43% in the immediately preceding fourth quarter and from 4.14% in the 2006 first quarter, reflecting increases in the prime rate and strong competition in the deposit market. The average cost of total deposits rose to 3.36% for the 2007 first quarter from 3.09% in the year-ago period. Total assets at March 31, 2007 increased to $1.87 billion from $1.84 billion at year-end 2006, principally reflecting the growth in the company's loan portfolio. Average interest-earning assets totaled $1.72 billion at the end of the 2007 first quarter, compared with $1.58 billion at December 31, 2006. Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. at March 31, 2007 increased to $146.9 million from $140.7 million at December 31, 2006. At first quarter-end 2007, Center Financial continued to be "well-capitalized" under all regulatory categories, with a Tier 1 risk-based capital ratio Risk-based capital ratio Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset. of 9.71%, a total risk-based capital ratio of 10.82%, and a Tier 1 leverage ratio of 8.79%. Yoo added: "Although the demand for loans has slightly softened soft·en v. soft·ened, soft·en·ing, soft·ens v.tr. 1. To make soft or softer. 2. To undermine or reduce the strength, morale, or resistance of. 3. as we entered 2007, the core markets that we operate in continue to show signs of growth and opportunities. With a streamlined and strengthened organizational structure  This article has no lead section.To comply with Wikipedia's lead section guidelines, one should be written. to drive performance and a strong credit culture of strict compliance to our underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. and credit administration, we believe Center Financial is well poised to continue delivering quality growth in 2007 and beyond." Investor Conference Call The company will host an investor conference call at 11:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT (8:00 a.m. PDT PDT abbr. Pacific Daylight Time PDT Pacific Daylight Time PDT n abbr (US) (= Pacific Daylight Time) → hora de verano del Pacífico PDT ) on Thursday, April 26, 2007 to review the financial results for its 2007 first quarter. The call will be open to all interested investors through a live, listen-only audio Web broadcast via the Internet at www.centerbank.com and www.earnings.com. Listeners are encouraged to visit the Web site at least 15 minutes prior to the start of the scheduled presentation to register, download and install any necessary audio software. For those who are not available to listen to the live broadcast, the call will be archived for one year at both Web sites. A telephone replay of the call will be available through 8:00 p.m. EDT, Thursday, May 3, 2007 by dialing 888-286-8010 (domestic) or 617-801-6888 (international) and entering passcode 16864928. About Center Financial Corporation Center Financial Corporation is the holding company of Center Bank, a community bank offering a full range of financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. for diverse ethnic and small business customers. Founded in 1986 and specializing in commercial and SBA loans and trade finance products, Center Bank has grown to be one of the nation's largest financial institutions focusing on the Korean-American community, with total assets of $1.87 billion at March 31, 2007. Headquartered in Los Angeles, Center Bank operates 26 branch and loan production offices. Of the company's 17 full-service branches, 15 are located throughout Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, , along with one branch each in Chicago and Seattle. Center Bank's nine loan production offices are strategically located in Phoenix, Seattle, Denver, Washington D.C., Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. , Atlanta, Honolulu, Houston and Dallas. Center Bank is a California state-chartered institution and its deposits are insured by the FDIC FDIC See: Federal Deposit Insurance Corporation FDIC See Federal Deposit Insurance Corporation (FDIC). to the extent provided by law. For additional information on Center Bank, visit the company's Web site at www.centerbank.com. This release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , which are included in accordance with the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These forward-looking statements include, but are not limited to, statements regarding the anticipated growth of Center Financial and Center Bank in 2007, the company's ability to continue process improvement and the company's ability to reduce excess liquidity and price-sensitive deposits from its balance sheet. The forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and actual results and performance in future periods may be materially different from any future results or performance suggested by the forward-looking statements in this release. Factors that might cause such differences include, but are not limited to, those identified in our cautionary statements contained in Center Financial Corp.'s Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended December 31, 2006 (See Business, and Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial ), and other filings with the Securities and Exchange Commission (SEC) are incorporated herein by reference. These factors include, but are not limited to: competition in the financial services market for both deposits and loans; the ability of Center Financial and its subsidiaries to increase its customer base; changes in interest rates; new litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. or changes or adverse developments in existing litigation; and regional and general economic conditions. Such forward-looking statements speak only as of the date of this release. Center Financial expressly disclaims any obligation to update or revise any forward-looking statements found herein to reflect any changes in the company's expectations of results or any change in events. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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