A securities class-action lawsuit against Wilshire Bancorp Inc. in Los Angeles has been dismissed after the plaintiffs failed to file an amended complaint in the case.
The lawsuit, filed in March 2011 in the U.S. District Court for the Central District of California, alleged that Wilshire, former Chief Executive Joanne Kim and current Chief Financial Officer Alex Ko provided misleading statements and failed to disclose deficiencies in its underwriting, origination and renewal process, according to a 10-K filing on Thursday. The suit also claimed that the company lacked adequate internal controls.
The $2.7 billion-asset Wilshire had previously discovered a problem with its loan underwriting, approval and renewal processes for originations and asset sales associated with a former senior marketing officer. An investigation found that the process lacked supervision and oversight, Wilshire said in the regulatory filing.
Kim subsequently resigned and Jae Whan Yoo, former president and CEO at Center Financial Corp. in Los Angeles, was hired in February 2011 as president and CEO.
Wilshire's motion to dismiss the case was granted on Feb. 8 but the plaintiffs had until Feb. 29 to file an amended complaint. The plaintiffs did not and a judge dismissed the case on March 5, the regulatory filing said.
The company also said Thursday in a news release that it had corrected problems with its internal controls for loan underwriting, approval and renewals for certain originations and asset sales.
"With the dismissal of the class-action lawsuit and the remediation of the material weakness, we are very pleased to have resolved two issues that required significant attention from the management team and board of directors," Yoo said Thursday in a news release. "Now that these issues are behind us, we can increase our focus on other initiatives that will more directly contribute to the profitable growth of the company."