Preferred Bank Files Definitive Proxy Statement Seeking Approval for One-For-Five Reverse Stock Split

LOS ANGELES, April 28, 2011 /PRNewswire/ -- Preferred Bank (NASDAQ: PFBC), an independent commercial bank focusing on the Chinese-American and diversified Southern California mainstream market, today reported that it had filed its Definitive Proxy Statement with the Federal Deposit Insurance Corporation for the annual meeting of shareholders to be held on May 24, 2011 at 1:00 pm. Among the proposals on which shareholders will vote is Preferred Bank's proposal to effect a one-for-five reverse stock split of its common stock.  As stated in the Definitive Proxy Statement, Preferred Bank is proposing the reverse stock split with a view to increasing the share trading price of the common stock. Other reasons include:

• Increase in eligible investors. A reverse stock split could allow for a broader range of institutional investors to own the stock, especially those who have minimum stock price requirements for investment.
• Increased analyst and broker interest. A reverse stock split could have the effect of increasing analyst and broker interest in the stock as their policies often discourage them from recommending investing in companies with low stock prices.

Other information concerning the proposed reverse stock split, including a description of the potential effects of the reverse stock split, are contained in the Definitive Proxy Statement.

About Preferred Bank

Preferred Bank is one of the largest independent commercial banks in California focusing on the Chinese-American market. 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 Company conducts its banking business from its main office in Los Angeles, California, and through nine full-service branch banking offices in Alhambra, Century City,  City of Industry, Torrance, Arcadia, Irvine, Diamond Bar, Anaheim and Pico Rivera, 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.  Preferred Bank continues to benefit from the significant migration to Southern California of ethnic Chinese from China and other areas of East Asia.  While its business is not solely dependent on the Chinese-American market, it represents an important element of the bank's operating strategy, especially for its branch network and deposit products and services. Preferred Bank believes it is well positioned to compete effectively with the smaller Chinese-American community banks, the larger commercial banks and other major banks operating in Southern California by offering a high degree of personal service and responsiveness, experienced multi-lingual staff and substantial lending limits.

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 Preferred Bank's future financial and operating results, Preferred 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 Preferred 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 Preferred Bank takes title; and the threat of terrorism. Additional factors that could cause Preferred Bank's results to differ materially from those described in the forward-looking statements can be found in Preferred Bank's 2010 Annual Report on Form 10-K filed with the Federal Deposit Insurance Corporation ("FDIC") 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 Preferred 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 Preferred Bank's website at www.preferredbank.com.

Important Information for Investors and Shareholders

This press release relates to a proposed reverse stock split that is the subject of a proxy statement filed by Preferred Bank with the FDIC on April 28, 2011. The definitive proxy statement and the 2010 Annual Report on Form 10-K are publicly available free of charge on Preferred Bank's website at http://preferredbank.com/proxymaterials/.  Copies of these materials may also be obtained from the FDIC at the Public Reference Section, Room F-6043, 550 17th Street, N.W., Washington, DC 20429. These materials were disseminated to shareholders on or about April 28, 2011.  This press release is not a substitute for the proxy statement. Investors and security holders are urged to read the proxy statement and any other relevant documents, because such materials contain important information about the proposed reverse stock split.

Participants in the Solicitation

Preferred Bank and its respective directors and executive officers may be deemed under the rules of the FDIC to be participants in the solicitation of proxies from the shareholders of Preferred Bank.  A list of the names of those directors and executive officers and descriptions of their interests in Preferred Bank is contained in the proxy statement filed by Preferred Bank with the FDIC.  Shareholders may obtain additional information about the interests of the directors and executive officers in the proposed action by reading the proxy statement.

SOURCE Preferred Bank