Business & Finance
Business and Finance
Business and Finance
Tue, February 24, 2009
Mon, February 23, 2009 Premier Service Bank Receives $4,000,000 in New Capital from the U.S. Treasury under the Treasury?s Capital Purchase Program
RIVERSIDE, Calif.--([ BUSINESS WIRE ])--Premier Service Bank (OTCBB:PSBK) today announced that on February 20, 2009, the Bank received $4,000,000 in new capital through the U.S. Treasury's Capital Purchase Program (CPP).
Premier Service Bank's total risk-based capital ratio of 10.94% at December 31, 2008 was already above the regulatory requirement of 10% for a "well capitalized" institution. With the additional $4,000,000 of Tier 1 capital from the sale of preferred stock to the Treasury, the Bank's total risk-based capital ratio increased to 13.9%. Additionally, the Bank's Tier 1 leverage capital ratio increased to 11.1%, from 8.9% at December 31, 2008.
"We are pleased to be among the nation's financially strong banks that were accepted by the Treasury for participation in this program," said Kerry Pendergast, President and Chief Executive Officer. "The CPP funds will enhance our capacity to lend and our ability to support economic activity for the benefit of the markets we serve."
Under the terms of the Capital Purchase Program, Premier Service Bank issued to the U.S. Department of the Treasury, in exchange for aggregate consideration of $4,000,000, a total of 4,000 shares of Series A Fixed-Rate Non-Cumulative Perpetual Preferred Stock and a warrant for the purchase of 200 shares of Warrant Preferred Stock. The warrant was exercised immediately upon close of the transaction. The dividend rate on the $4,000,000 of Series A Preferred Stock is 5% per year for five years and then increases to 9% per year, payable $50,000 per quarter for the first five years, and the dividend rate on the $200,000 liquidation value of the Warrant Preferred Stock is 9% per year, payable $4,500 per quarter.
Premier Service Bank is a California state-chartered bank with two offices, its headquarters office in Riverside and a full-service banking office in Corona. The Bank provides commercial banking services, including a wide variety of checking accounts, investment services with competitive deposit rates, on-line banking products, and real estate, construction, commercial and consumer loans, to small and medium-sized businesses, professionals and individuals. Additional information about Premier Service Bank is available at its website at [ www.premierservicebank.com ].
Forward-looking Statements
This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about Premier Service Bank's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and in the following: Premier Service Bank's ability to increase its assets, deposits and total loans, control expenses, retain critical personnel, manage interest rate risk, manage technological changes, address regulatory requirements, and other risks discussed from time to time in Premier Service Bank's filings and reports with the Federal Deposit Insurance Corporation. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and Premier Service Bank does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
For a more complete discussion of risks and uncertainties, investors and security holders are urged to read Premier Service Bank's annual report on Form 10-K, quarterly reports on Form 10-Q and other reports filed by Premier Service Bank with the FDIC.
