Profile: Wilshire Bancorp Inc (WIBC.O)
7 Mar 2014
Wilshire Bancorp, Inc., incorporated in December 2003, is a bank holding company offering a range of financial products and services primarily through its main subsidiary, Wilshire State Bank (the Bank), a California state-chartered commercial bank. It operates in three primary business segments: Banking Operations, Trade Finance Services, and Small Business Administration (SBA) Lending Services. In addition, the Bank has 24 full-service branch offices in Southern California, Texas, New Jersey, and the greater New York City metropolitan area. It also has six loan production offices (LPOs), utilized primarily for the origination of loans under its SBA, lending program in Colorado, Georgia, Texas (two offices), and Virginia. The Bank operates a community bank focused on the general commercial banking business. At December 31, 2010, the Bank had approximately $2.97 billion in assets, $2.33 billion in total loans, and $2.46 billion in deposits. In October 2013, the Company acquired BankAsiana. Effective November 20, 2013, Wilshire Bancorp, Inc announced the completion of its acquisition of Saehan Bancorp.
The Bank’s lending activities include commercial real estate and home mortgage lending, commercial business lending and trade finance, SBA lending, consumer loans and construction lending. It offers commercial real estate loans to finance the acquisition of, or to refinance the existing mortgages on commercial properties, which include retail shopping centers, office buildings, industrial buildings, warehouses, hotels, automotive industry facilities, and apartment buildings. Its commercial real estate loans are typically collateralized by first or junior deeds of trust on specific commercial properties, and, when possible, subject to corporate or individual guarantees from financially capable parties. The properties collateralizing real estate loans are principally located in the markets where its retail branches are located. These locations include Southern California, Texas, New Jersey, and the greater New York City metropolitan area. However, it also provides commercial real estate loans through its LPOs. Real estate loans typically bear an interest rate that floats with its base rate, the prime rate, or another established index. It also offers fixed rate commercial mortgage loans with maturities that do not exceed seven years. At December 31, 2010, real estate loans constituted approximately 85.3% of its loan portfolio.
Commercial real estate loans typically have seven-year maturities with up to 25-year amortization of principal and interest and loan-to-value ratios of 60-70% of the appraised value or purchase price, whichever is lower. Its total home mortgage loan portfolio outstanding during the year ended December 31, 2010, was $47.7 million. It offers commercial business loans to sole proprietorships, partnerships, and corporations. These loans include business lines of credit and business term loans to finance operations, to provide working capital, or for specific purposes, such as to finance the purchase of assets, equipment, or inventory.
The Bank’s SBA market area includes the geographic areas encompassed by its full-service banking offices in Southern California, Texas, New Jersey, and the New York City metropolitan area, as well as the multi-ethnic population areas surrounding its LPOs in other states. Consumer loans include personal loans, auto loans, and other loans typically made by banks to individual borrowers. As of December 31, 2010, its consumer loan portfolio represented 0.7% of the loan portfolio.
As of December 31, 2010, the Bank’s investment portfolio was primarily comprised of United States government agency securities, accounting for 88.5% of the entire investment portfolio. Its United States government agency securities holdings are all prime/conforming mortgage backed securities (MBS), and collateralized mortgage obligations (CMOs), guaranteed by Federal National Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC), or Government National Mortgage Association (GNMA).
Sources of Funds
The Bank’s primary sources of funds are deposits and loan repayments. It offers a variety of accounts for depositors which are designed to attract both short-term and long-term deposits. These accounts include certificates of deposit (CDs), regular savings accounts, money market accounts, checking and negotiable order of withdrawal (NOW) accounts, installment savings accounts, and individual retirement accounts (IRAs). It offers several types of CDs with a maximum maturity of five years. The majority of its CDs have maturities of 1 to 12 months and typically pays simple interest credited monthly or at maturity.
The Bank offers savings accounts that allow for unlimited deposits and withdrawals, provided that depositors maintain a $100 minimum balance. Money market accounts pay a variable interest rate that is tiered depending on the balance maintained in the account. Checking and NOW accounts are generally noninterest and interest bearing accounts, respectively, and may include service fees based on activity and balances. The Bank borrows funds in the form of advances from the Federal Home Loan Bank of San Francisco.
Trade Finance Services
Trade Finance products include the issuance and negotiation of commercial and standby letters of credit, as well as handling of documentary collections. On the export side, it provides advising and negotiation of commercial letters of credit, and it transfers and issues back-to-back letters of credit. It also provides importers with trade finance lines of credit, which allow for issuance of commercial letters of credit and financing of documents received under such letters of credit, as well as documents received under documentary collections.
Internet Banking and Other Services
The Bank offers Internet banking, which allows its customers to access their deposit and loan accounts through the Internet. Customers are able to obtain transaction history and account information, transfer funds between accounts, make on-line bill payments, and open deposit accounts. It also offers automated teller machine (ATMs) located at selected branch offices, customer access to an ATM network, and armored carrier services.
Wilshire Bancorp Inc
Suite 1400, 3200 Wilshire Boulev
LOS ANGELES CA 90010