Center Financial Corp.'s stock fell sharply Thursday on news that the Los Angeles company had found "material weakness" in its internal controls and had requested an extension for the filing of its annual report.
To help correct accounting deficiencies, the $1.3 billion-asset parent of Center Bank said it has beefed up its accounting staff and hired Patrick Hartman, a longtime California banker, as its chief financial officer.
Center Financial announced after the market closed Wednesday that it had identified weaknesses in implementing "various complex accounting principles" in what it termed "nonroutine business transactions." It also revealed that on March 16 it asked the Securities and Exchange Commission for a 15-day extension in filing its 10-K for 2004.
On Thursday, Center's stock fell 10.5%, to $18.80 a share, in heavy trading.
Center Bank, which largely targets Korean-Americans, has 15 branches in southern California and Chicago and loan production offices in nine other U.S. cities.
Mr. Hartman, 56, was the CFO at two California community banks between 1979 and 1997. Since then he had worked at a consulting firm he founded.
Center Financial also said last week that it had hired Thomas Levine as its general counsel. Mr. Levine, 53, has served in a similar capacity at several community banks over the last two decades. He was once a staff attorney with the Federal Deposit Insurance Corp.
