Regulators have terminated an agreement with Preferred Bank in Los Angeles that required improvements to its data-security system.
The $1.9 billion-asset company said in a press release Wednesday that the Federal Deposit Insurance Corp. and the California Department of Business Oversight terminated the year-old memorandum of understanding.
The memorandum was meant to correct certain data-security deficiencies found during an exam last year, explained Edward J. Czajka, executive vice president and chief financial officer. "All the provisions of the MOU were related to our [Bank Secrecy Act] and [e-mail data exchange] programs," he said.
It also required that the bank build its Tier 1 capital ratio to 10%.
"We are pleased to have this chapter behind us," Li Yu, the bank's chairman and chief executive officer, said in the release. "Going forward, we will now be able to pay dividends and manage our capital in a more effective manner."
Originally founded as a Chinese-American commercial bank, Preferred now serves a broader market through 10 branches across California.