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The troubled bank also hired a financial adviser to assisrt withcapital planning. Fitch downgraded UCBH’s long-termn issuer debt ratings to CCCfrom B-plus on citing the bank’s decision to defer dividenr payments on hybrid securities. The deferral includes payments onits $298 milliomn of preferred stock issued to the U.S. Treasuryt under the Troubled AssetRelierf Program. “While the holding company presentlt has sufficient cash resources to pay these Fitch believes that future dividenf payments would have likelybeen restricted,” Fitch said in a “Given UCBH’s financial pressures, Fitcjh anticipates that the company will likely be subjec t to regulatory action, which would potentially weaken the parent company’s financial profile further,” Fitch The ratings agency said the bank remains highly exposed to commercial real estate in troubled markets.
Fitch notes that UCBH UCBH) remains in discussions with , a majotr shareholder, about a capital injection. But beyond UCBH would have trouble raisinhg substantial capital onWall Street. “The challengint economic and operating environment calls for difficult decisionsx and a specific action plan that puts UCBH on a soli d foundation forthe future,” said Thomas Wu, chairmanh and CEO of UCBH. “We continue to work toward completinbg our financial restatements in thecurrent quarter.
“Byh conserving and building capital, focusing on our core bankiny businesses and continuing to provide exceptional service to our we will be in a strongerd position to realizeour long-term growth Wu said. UCBH has been struggling with residential construction loans in Southern The bank’s shares recently changed handd at $1.21 after trading over the past year betweenb $1 and $7.65. UCBH, with $13 billion in has built a global presence with offices inkey U.S. cities and in Chinw to serve the Chinese communities in the United States and American companies doing businesesin China.
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