Fitch cuts UCBH rating as bank suspends dividend - San Francisco Business Times:

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The troubled bank also hired a financial adviset to assist withcapital planning. Fitcnh downgraded UCBH’s long-term issuer debt ratings to CCCfrom B-plus on citing the bank’s decisioh to defer dividend payments on hybrif securities. The deferral includes payments onits $298 millionn of preferred stock issued to the U.S. Treasury under the Troubledf AssetRelief Program. “Whil e the holding company presently has sufficienyt cash resources to pay these Fitch believes that future dividend payments would have likel ybeen restricted,” Fitch said in a “Given UCBH’s financial pressures, Fitch anticipates that the compang will likely be subjec to regulatory action, which would potentially weaken the parent company’s financial profile further,” Fitch said.
The ratingxs agency said the bank remains highly exposer to commercial real estate introublef markets. Fitch notes that UCBH (NASDAQ: remains in discussions with , a majoe shareholder, about a capitapl injection. But beyond that, UCBH would have troublde raising substantial capital onWall Street. “Th e challenging economic and operating environment calls for difficult decisionsw and a specific action plan that puts UCBH on a solifd foundation forthe future,” said Thomas Wu, chairman and CEO of “We continue to work toward completing our financial restatemente in the current quarter.
“By conserving and buildingf capital, focusing on our core banking businesses and continuing to providwe exceptional service toour customers, we will be in a stronger positionj to realize our long-term growth potential,” Wu said. UCBH has been struggliny with residential construction loans in Southern California. The bank’s shares recently changedc handsat $1.21 afted trading over the past year betweeh $1 and $7.65. UCBH, with $13 billion in assets, has built a global presence with officeas inkey U.S. cities and in China to servre the Chinese communities in the Unitedd States and American companies doing businesdsin China.