The Federal Reserve Board has approved Community West Bancshares' (CWBC) request to pay dividends on preferred stock.
An April 2012 written agreement with the Fed precluded the Goleta, Calif.-based Community West from paying dividends without prior regulatory approval. Community West now expects to pay $1.4 million in dividends, which were deferred between May 15, 2012, and Nov. 15, 2013. The payment will be distributed in January, according to a press release Thursday.
Community West's written agreement with the Fed requires the $532 million-asset company to develop a capital plan. The company is also operating under a January 2012 consent order issued by the Office of the Comptroller of the Currency that requires it to clean up its loan portfolio and maintain Tier 1 capital of at least 9% and total risk-based capital of at least 12%.
The company had a 12.1% Tier 1 leverage ratio and a 17.62% total risk-based capital ratio as of Sept. 30, according to the release.
Community West reported earnings of $2.6 million in the third quarter, up 24% from the same period in 2012. It earned $5.9 million in the first nine months of the year, a 600% increase from the first nine months of the previous year.