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Preferred Bank

Houston, TX · Cert 32265

FDIC · 5 branches

Q3 2019

Board Package

Performance Trends and Peer Comparison

Part 1Performance Trends, own institution only2
Part 2Peer Comparison, not published for this institution and quartern/a

Basis

Quarter: Q3 2019, the quarter ended September 30, 2019, on both parts.

Income statement: year to date as filed, annualized, on both parts.

Balance sheet: as filed at quarter end.

Peer group

No peer standings are published for this institution and quarter.

Peer groups below the disclosure floor are suppressed.

Source: FFIEC Call Report (031/041/051), as filed. Dollar figures derived from reported amounts in thousands. Ratios computed by CallReports.ai using published regulatory formulas.

CallReports · callreports.ai · Board PackageGenerated 2026-10-11

Preferred Bank

Houston, TX · Cert 32265

FDIC · 5 branches

Q3 2019

$331.6MAssets
$162.8MLoans
$291.0MDeposits
$37.7MEquity
Loan mix
94%RE $126.5M6%C&I $8.0M0%Consumer $0.1MQ3 2018Q3 2019
Deposit mix
60%Interest-bearing $174.0M40%Noninterest $117.0MQ3 2018Q3 2019

NIM

4.14%Q3 ’174.03%Q3 ’181.29%Q3 ’19-4%-70%

Non-interest income vs. expense

2.75%Q3 ’172.48%Q3 ’180.78%Q3 ’19-10%-69%

Market Position · Houston-The Woodlands-Sugar Land, TX · 2019 SOD (annual) · 0.1% share · #53 of 95 inst. · $0.2B of $249.6B

0.1% Harris
0.2% Montgomery

Executive Summary

  • Earnings: ROA of 0.30%, down 71 bps year over year; NIM at 1.10%.
  • Asset quality: problem loans at 1.04% of loans (+14 bps YoY), with net charge-offs at 0.00%.
  • Capital: tier 1 leverage ratio of 8.27%, down 765 bps from a year ago.
  • Funding: loans stand at 55.95% of deposits as of Q3 2019.

Financial Results

Return on Assets (YTD, annualized)

0.30%-71 bps YoY

Net Interest Margin (YTD, annualized)

1.10%-258 bps YoY

Efficiency Ratio (YTD, annualized)

69.02%+367 bps YoY

Tier 1 Leverage Ratio

8.27%-765 bps YoY

Year to date, annualized, through each quarter.

MetricQ3 2018Q4 2018Q1 2019Q2 2019Q3 2019YoY ΔTrend
Earnings
Return on Assets1.01%1.13%0.87%-0.60%0.30%-71 bps
Return on Equity6.92%7.68%5.53%-3.88%2.10%-481 bps
Net Interest Margin3.68%3.73%4.01%4.02%1.10%-258 bps
Efficiency Ratio65.35%64.06%70.86%111.15%69.02%+367 bps
Non-Interest Burden2.37%2.30%2.80%4.49%0.74%-162 bps
Growth
Asset Growth (YoY)0.92%-3.00%0.86%-2.16%22.49%+2,158 bps
Loan Growth (YoY)-0.13%8.97%8.89%6.51%0.49%+62 bps
Deposit Growth (YoY)0.07%-4.52%-0.12%-3.66%28.07%+2,800 bps
Asset Quality
Nonperforming Loans / Loans0.90%1.09%0.60%2.06%1.04%+14 bps
Net Charge-Offs / Loans-0.04%-0.14%0.00%-0.07%0.00%+3 bps
Allowance / Loans1.10%1.04%1.01%1.03%0.04%-107 bps
Allowance Coverage of NPLs1.2x1.0x1.7x0.5x0.0x-1.2x
Capital
Tier 1 Leverage Ratio15.92%16.44%17.55%16.60%8.27%-765 bps
Total Risk-Based Capital28.59%28.21%28.97%29.20%16.62%-1,196 bps
Equity / Assets15.57%15.30%16.32%14.73%11.37%-420 bps
Liquidity & Funding
Loans / Deposits71.31%72.20%79.05%71.66%55.95%-1,536 bps
Liquid Assets / Assets36.39%36.27%31.15%36.58%39.38%+299 bps
CRE / Total Capitaln/an/an/an/an/an/an/a