Preferred Bank (NASDAQ:PFBC) Q1 2024 Earnings Call Transcript

David Feaster: Okay. That’s helpful. And maybe I just want to squeeze one more. You’ve been real active in repurchasing stock. Curious, maybe with potential for gaining growth to accelerate the move in the stock that we’ve seen. Curious your capital priorities and your appetite for additional buybacks?

Li Yu: We have always been letting our shareholders know that growth in the normal situation is our preference as it represents the best long-term value. But within the last three, four years, starting from the pandemic with the inflation and so on, where the bank is making over 20% return with the cost of alternative costs in the 5% range, it does not seem a good idea that had the idle cash, which we’re not doing much, nobody is doing much along those. With idle cash being staying there making 5%, buyback on stock represents a pre-tax 33% return, so economics tells me that our shareholders would like to trade it over the long term if we do that.

David Feaster: Makes a lot of sense. All right, thanks everybody.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Li Yu for any closing remarks.

Li Yu: Thank you very much. As I said that we’re very happy with the quarter and hopefully that, I personally believe that finally things started to getting stabilized and going forward. I hope it can only be better for the banking industry. Thank you.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.