21
Sale Price of the Company’s
Approximate
Calendar
Common Stock (per share)
Trading Volume
Quarter Ended
High
Low
In Shares
March 31, 2013
$13.35
$11.45
1,115,428
June 30, 2013
$14.93
$12.01
1,365,473
September 30, 2013
$17.04
$13.74
1,375,776
December 31, 2013
$19.89
$15.77
1,274,075
March 31, 2014
$17.00
$14.86
1,853,833
June 30, 2014
$16.25
$14.68
1,830,309
September 30, 2014
$17.95
$14.66
1,423,854
December 31, 2014
$18.00
$15.53
1,303,554
(b) Holders
As of January 31, 2015 there were an estimated 4,375 shareholders of the Company’s Common Stock. There were
543 registered holders of record on that date, and per Broadridge, an investor communication company, there were
also 3,832 beneficial holders with shares held under a street name, including “objecting beneficial owners” whose
names and addresses are unavailable.
(c)
Dividends
The Company paid cash dividends totaling $4.8 million, or $0.34 per share in 2014, and $3.7 million, or $0.26 per
share in 2013. This represents 31% of annual net earnings for dividends paid in 2014 and 28% in 2013. The Com-
pany’s general dividend policy is to pay cash dividends within the range of typical peer payout ratios, provided that
such payments do not adversely affect the Company’s financial condition and are not overly restrictive to its growth
capacity. However, in the recent past when many of our peers elected to suspend dividend payments, the Company’s
Board concluded that we should maintain the payment of a certain level of dividend as long as our core operating
performance was adequate and policy or regulatory restrictions did not preclude such payments, without regard to
peer payout ratios. While we have paid a consistent level of quarterly dividends in the past few years, no assurance
can be given that our financial performance in any given year will justify the continued payment of a certain level of
cash dividend, or any cash dividend at all.
As a bank holding company that currently has no significant assets other than its equity interest in the Bank, the
Company’s ability to declare dividends depends upon cash on hand as supplemented by dividends from the Bank.
The Bank’s dividend practices in turn depend upon the Bank’s earnings, financial position, regulatory standing,
current and anticipated capital requirements, and other factors deemed relevant by the Bank’s Board of Directors.
The power of the Bank’s Board of Directors to declare cash dividends is also subject to statutory and regulatory
restrictions. Under California banking law, the Bank may declare dividends in an amount not exceeding the lesser of
its retained earnings or its net income for the last three years (reduced by dividends paid during such period) or, with
the prior approval of the California Commissioner of Business Oversight, in an amount not exceeding the greatest of
(i) the retained earnings of the Bank, (ii) the net income of the Bank for its last fiscal year, or (iii) the net income of
the Bank for its current fiscal year. The payment of any cash dividends by the Bank will depend not only upon the
Bank’s earnings during a specified period, but also on the Bank meeting certain regulatory capital requirements.
The Company’s ability to pay dividends is also limited by state law. The California General Corporation Law allows
a California corporation to pay dividends if the company’s retained earnings equal at least the amount of the pro-
posed dividend. If a California corporation does not have sufficient retained earnings available for the proposed
dividend, it may still pay a dividend to its shareholders if immediately after the dividend the sum of the company’s
assets (exclusive of goodwill and deferred charges) would be at least equal to 125% of its liabilities (not including
deferred taxes, deferred income and other deferred liabilities) and the current assets of the company would be at least
equal to its current liabilities, or, if the average of its earnings before income taxes and before interest expense for the
two preceding fiscal years was less than the average of its interest expense for the two preceding fiscal years, at least
equal to 125% of its current liabilities. In addition, during any period in which the Company has deferred payment of
interest otherwise due and payable on its subordinated debt securities, it may not make any dividends or distributions
with respect to its capital stock (see “Item 7, Management’s Discussion and Analysis of Financial Condition and
Results of Operations – Capital Resources”).
