CLFC Center Financial Corporation (MM)

Center Financial Corporation (NASDAQ: CLFC) today reported financial results for its 2011 first quarter, posting net income of $4.9 million and net income available to common shareholders of $4.1 million, equal to $0.10 per diluted common share, and continued improvements in all asset quality metrics.

“Center Financial’s 2011 first quarter results demonstrate sustainability in the company’s operational performance and ongoing improvements in asset quality and capital strength,” said Richard S. Cupp, president and chief executive officer. “Notwithstanding these positive trends, we recognize the economic conditions in our core markets continue to be challenging on numerous fronts. While our focus on returning to growth was overcome this quarter by higher-than-usual levels of pay-offs and pay-downs, we are pleased that our new business development efforts have led to a growing loan pipeline. Given our proactive identification and management of the risks associated with our portfolio, we are optimistic that our credit metrics will continue to steadily improve. We continue to make progress with preparations for and look forward to completion of the pending combination with Nara Bancorp.”

2011 FIRST QUARTER FINANCIAL HIGHLIGHTS

    At or for the Three Months Ended       3/31/2011     12/31/2010     3/31/2010 Non-covered nonperforming loans, net of SBA guarantee     $ 34,142       $ 42,225       $ 65,720   Delinquent non-covered loans 30 to 89 days past due, net of SBA guarantee     $ 10,352       $ 12,732       $ 28,006   Non-covered net loan charge-offs     $ 7,037       $ 7,413       $ 4,532   Provision for loan losses     $ 6,000       $ 6,010       $ 7,000   Allowance for non-covered loan losses       3.53 %       3.41 %       4.01 % Gross non-covered loans     $ 1,447,777       $ 1,528,266       $ 1,522,439   Total deposits     $ 1,779,606       $ 1,770,994       $ 1,625,312   Noninterest-bearing deposits as a % of total deposits       23.0 %       22.4 %       22.2 % Annualized average cost of deposits       1.05 %       1.09 %       1.31 % Net interest margin       3.49 %       3.28 %       3.41 % Gain on sale of loans     $ 3,752       $ (100 )    

$

─

Income before income tax provision (benefit)     $ 5,390       $ 3,366       $ 4,254   Income tax provision (benefit)     $ 505       $ (3,084 )     $ 1,487   Net income     $ 4,885       $ 6,450       $ 2,767   Net income (loss) available to common shareholders     $ 4,135       $ 5,700       $ (26,985 ) Net income (loss) per diluted common share     $ 0.10       $ 0.14       $ (1.27 ) Total risk-based capital ratio       20.42 %       18.87 %       18.23 % Tier 1 leverage ratio       12.85 %       12.74 %       12.82 %        

Loans acquired in the April 16, 2010 FDIC-assisted transaction are subject to a loss-sharing agreement and are referred to as “covered loans.” Center’s legacy portfolio is referred to as “non-covered.”

ASSET QUALITY

At March 31, 2011, total non-covered nonperforming assets net of SBA guarantees declined to $34.3 million from $43.2 at year-end 2010. As a percentage of gross non-covered loans and other real estate owned (OREO), total non-covered nonperforming assets net of SBA guarantees declined to 2.36% at March 31, 2011 from 2.82% at December 31, 2010. As of March 31, 2011, the company’s non-covered OREO portfolio declined to a carrying value of $144,000. This is down from $937,000 at December 31, 2010.

Non-covered nonperforming loans net of SBA guarantees at March 31, 2011 declined to $34.1 million from $42.2 million at December 31, 2010. The company said new inflows into nonperforming status totaled $7.9 million, a moderate reduction from the 2010 fourth quarter inflow of $8.4 million. Commercial real estate (CRE) loans accounted for 90% of new nonaccruals, reflecting the still challenging CRE market conditions. Inflows were more than offset by outflows of $15.2 million. Outflows included two loans aggregating $5.5 million transferred to loans held for sale at a carrying value of $4.6 million.

Delinquent non-covered loans 30 to 89 days past due net of SBA guarantees declined to $10.4 million at March 31, 2011 from $12.7 million at December 31, 2010. As with non-covered nonperforming loans, inflows into non-covered delinquencies also moderately declined to $9.0 million during the 2011 first quarter from $9.9 million during the preceding 2010 fourth quarter. Performing troubled debt restructurings (TDRs) that are not accounted for in non-covered nonaccrual or delinquent loans increased to $24.5 million at March 31, 2011 from $21.4 million at December 31, 2010.

The company’s covered loans that are subject to a loss-sharing agreement with the FDIC are reported separately in the consolidated statements of financial condition.

Non-covered loan net charge-offs during the 2011 first quarter totaled $7.0 million, down from $7.4 million in the preceding 2010 fourth quarter. As a percentage of average loans on an annualized basis, non-covered loan net charge-offs equaled 1.91% of average non-covered loans for the 2011 first quarter, compared with 1.84% for the 2010 fourth quarter.

Center Financial recorded a provision for loan losses of $6.0 million for the 2011 first quarter, all of which is related to non-covered loans. In the preceding 2010 fourth quarter, the company recorded an aggregate provision for loan losses of $6.0 million, including $5.0 million related to non-covered loans and $1.0 million related to covered loans.

As a result of the improving asset quality trends, the company’s allowance for loan losses was reduced to $51.0 million at March 31, 2011 from $52.0 million at December 31, 2010. Due to the decline in the company’s loan portfolio from the year-end, the allowance for loan losses as a percentage of gross non-covered loans rose to 3.53% at March 31, 2011 from 3.41% at December 31, 2010.

LOANS & DEPOSITS

Non-covered loans declined to $1.45 billion at March 31, 2011 from $1.53 billion at December 31, 2010. The company said new loan production during the 2011 first quarter was more than offset by higher levels of pay-offs, as well as several significant pay-downs in commercial lines of credit. Covered loans at March 31, 2011 declined to $111.8 million from $117.3 million at December 31, 2010. Total loans at March 31, 2011 amounted to $1.56 billion.

Total deposits at March 31, 2011 rose to $1.78 billion from $1.77 billion at December 31, 2010. Noninterest-bearing demand deposits as a percentage of total deposits rose to 23.0 % at March 31, 2011 from 22.4% at year-end 2010. The company’s loan-to-deposit ratio equaled 84.7% at March 31, 2011, compared with 89.9% at December 31, 2010.

The average cost of interest-bearing deposits continued to decline, decreasing to 1.34% for the three months ended March 31, 2011 from 1.39% for the 2010 fourth quarter. Total cost of deposits declined to 1.05% for the 2011 first quarter, compared with 1.09% for the preceding 2010 fourth quarter.

BALANCE SHEET SUMMARY & CAPITAL

Total assets at March 31, 2011 amounted to $2.26 billion, compared with $2.27 billion at December 31, 2010. The decrease principally reflects the reduction in the company’s non-covered loan portfolio. Average interest-earning assets equaled $1.94 billion for the 2011 first quarter, compared with $2.05 billion for the 2010 fourth quarter.

Total shareholders’ equity at March 31, 2011 rose to $278.9 million from $274.0 million at December 31, 2010. Tangible common equity as a percentage of tangible assets, which is a non-GAAP financial measure, rose to 9.91% at March 31, 2011 from 9.65% at December 31, 2010.

With five consecutive profitable quarters of operations, Center Financial’s capital position continued to be well in excess of minimum guidelines for “well-capitalized” institutions. At March 31, 2011, Total Risk-Based capital ratio was 20.42%, Tier 1 Risk-Based capital ratio equaled 19.14% and Tier 1 Leverage ratio amounted to 12.85%, all reflecting increases from the levels at December 31, 2010.

2011 FIRST QUARTER OPERATIONAL HIGHLIGHTS

Net interest income before provision for loan losses totaled $16.7 million for the 2011 first quarter, compared with $16.9 million for the 2010 fourth quarter and $16.4 million in the prior-year first quarter. The average yield on loans for the 2011 first quarter declined to 5.51% from 5.64% for the preceding fourth quarter of 2010 and from 5.67% for the 2010 first quarter.

The company’s net interest margin (NIM) for the 2011 first quarter increased 21 basis points to 3.49% from 3.28% in the 2010 fourth quarter and 8 basis points from 3.41% in the first quarter of 2010. The company attributed the sequential quarter NIM expansion to a reduction in lower yielding interest-earning assets during the quarter, in addition to the reduced cost of funds.

Noninterest income for the 2011 first quarter rose to $7.7 million from $4.9 million in the 2010 fourth quarter. The company attributed the increase primarily to a $3.8 million gain on sale of loans, which includes gains recognized from the SBA loan transfer in the 2010 fourth quarter, as well as 2011 first quarter SBA loan sale gains, as a result of an SBA rule change effected during the first quarter . In the year-ago first quarter, noninterest income amounted to $5.7 million and included a $2.2 million gain on sale of securities.

Total noninterest expense for the 2011 first quarter equaled $13.0 million, compared with $12.5 million in the preceding 2010 fourth quarter, and $10.9 million for the 2010 first quarter. The company’s efficiency ratio for the 2011 first quarter improved to 53.26% from 57.12% for the 2010 fourth quarter, but was higher when compared with 49.12% for the prior-year first quarter.

For the 2011 first quarter, Center Financial posted net income of $4.9 million and net income available to common shareholders of $4.1 million, equal to $0.10 per diluted common share. This includes a net income tax provision of $505,000, reflecting a reduction in the deferred tax asset valuation allowance by approximately $1.5 million from the December 31, 2010 balance. For the preceding 2010 fourth quarter, net income amounted to $6.5 million and net income available to common shareholders of $5.7 million, equal to $0.14 per diluted common share. The 2010 fourth quarter net income includes a net income tax benefit of $3.1 million.

In the 2010 first quarter, the company posted net income of $2.8 million and a net loss available to common shareholders of $27.0 million, equal to a net loss of $1.27 per common share. As previously announced, the company incurred a net loss available to common shareholders due to the beneficial conversion feature of the company’s Series B Preferred Stock issued in December 2009, which reduced net income by an intrinsic value of the beneficial conversion in the amount of $29.0 million.

For the 2011 first quarter, Center Financial posted a return on average assets (ROAA) of 0.86% and a return on average equity (ROAE) of 7.17%. This compares with an ROAA of 1.12% and an ROAE of 9.35% for the 2010 fourth quarter. For the year-ago first quarter, the company reported an ROAA of 0.53% and an ROAE of 4.34% .

Use of Non-GAAP Financial Measures

This news release includes “non-GAAP financial measures” within the meaning of the Securities and Exchange Commission rules. Tangible common equity per common share and tangible common equity to tangible assets are non-GAAP financial measures. Tangible common equity was calculated as total shareholders’ equity less preferred stock and related dividend and accretion of preferred stock discount and net intangible assets. Tangible common equity to tangible assets represents tangible common equity divided by total assets less net intangible assets. The calculation of tangible common equity may differ among companies in light of diversity in presentation in the marketplace. Management believes that these measures are useful when comparing banks with preferred stock due to TARP funding to banks without preferred stock on their balance sheet and for evaluating a company’s capital levels. This information is being provided in response to market participant interest in these financial metrics. This information is not intended to be considered in isolation or as a substitute for the relevant measures calculated in accordance with U.S. GAAP. The reconciliations of these non-GAAP financial measures to GAAP financial measure included in this news release are attached herein.

Investor Conference Call

The company will host an investor conference call on Thursday, April 28, 2011 at 9 a.m. PDT (12 noon EDT) to review financial results for its 2011 first quarter. The institutional investment community is invited to participate in the call by dialing 866-700-7173 (domestic) or 617-213-8838 (international) and entering passcode 59594845. Other interested parties are invited to listen to the live call through a listen-only audio Web broadcast via the Internet in the Investor Relations section of www.centerbank.com. Listeners are encouraged to visit the Web site at least 15 minutes prior to the start of the scheduled presentation to register, download and install any necessary audio software. For those who are not available to listen to the live broadcast, the audio broadcast will be archived for one year. A telephonic replay of the call will be available through Thursday, May 5, 2011 by dialing 888-286-8010 (domestic) or 617-801-6888 (international) and entering replay passcode 49727640.

About Center Financial Corporation

Center Financial Corporation is the holding company of Center Bank, a community bank offering a full range of financial services for diverse ethnic and small business customers. Founded in 1986 and specializing in commercial and SBA loans and trade finance products, Center Bank has grown to be one of the nation’s leading financial institutions focusing on the Korean-American community, with total assets of $2.26 billion at March 31, 2011. Headquartered in Los Angeles, Center Bank operates a total of 22 full-service branches and two loan production offices. The company has 16 full-service branches located throughout Southern California and three branches in Northern California. Center Bank also operates two branches and one loan production office in the Seattle area, one branch in Chicago and a loan production office in Denver. Center Bank is a California state-chartered institution and its deposits are insured by the FDIC to the extent provided by law. For additional information on Center Bank, visit the company’s Web site at www.centerbank.com.

Additional Information and Where to Find It

In connection with the proposed merger of Center Financial Corporation and Nara Bancorp, Inc., Nara has filed a Registration Statement on Form S-4 (Registration No. 333-173511) with the Securities and Exchange Commission (SEC) that includes a Joint Proxy Statement/Prospectus of Center Financial Corporation and Nara Bancorp, as well as other relevant documents concerning the proposed merger. Shareholders are urged to read the Registration Statement and the Joint Proxy Statement/Prospectus regarding the merger and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information about the transaction. You may obtain a free copy of the Joint Proxy Statement/Prospectus, as well as other filings containing information about Nara Bancorp and Center Financial at the SEC’s Web site (www.sec.gov). You may also obtain these documents free of charge from Center at http://www.centerbank.com or from Nara at http://www.narabank.com under the tab “Investor Relations” and then under the heading “SEC Filings.”

Participants in Solicitation

Center Financial, Nara Bancorp and their respective directors, executive officers, management and employees may be deemed to be participants in the solicitation of proxies in respect of the merger. Information concerning Center Financial’s participants is set forth in its Form 10-K Annual Report filed with the SEC for the year ended December 31, 2010. Information concerning Nara Bancorp’s participants is set forth in its Form 10-K Annual Report for the year ended December 31, 2010, as amended by its Form 10-K/A filed with the SEC on April 26, 2011. Additional information regarding the interests of participants of Center Financial and Nara Bancorp in the solicitation of proxies in respect of the merger is included in the Registration Statement and Joint Proxy Statement/Prospectus filed with the SEC.

This release contains forward-looking statements, which are included in accordance with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and actual results and performance in future periods may be materially different from any future results or performance suggested by the forward-looking statements in this release. Factors that might cause such differences include, but are not limited to, those identified in our cautionary statements contained in Center Financial Corp.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010 (See Business, and Management’s Discussion and Analysis), and other filings with the SEC are incorporated herein by reference. These factors include, but are not limited to: the health of the national and California economies; competition in the financial services market for both deposits and loans; the ability of Center Financial and its subsidiaries to increase its customer base; customers’ service expectations; changes in interest rates; loan portfolio performance; the company’s ability to sustain profitable operations; the company’s ability to capitalize on strategic growth opportunities. Factors also include, but are not limited to: the successful completion of the proposed merger of equals between Center Financial Corporation and Nara Bancorp; difficulties and delays in integrating the two institutions and achieving anticipated synergies, cost savings and other benefits from the transaction; higher than anticipated transaction costs; deposit attrition, operating costs, customer loss and business disruption following the merger, including difficulties in maintaining relationships with employees; the companies’ ability to receive required regulatory and shareholder approvals. Such forward-looking statements speak only as of the date of this release. Center Financial expressly disclaims any obligation to update or revise any forward-looking statements found herein to reflect any changes in the company’s expectations of results or any change in events.

    CENTER FINANCIAL CORPORATION CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited) (Dollars in thousands)     3/31/2011 12/31/2010 ASSETS Cash and due from banks $ 33,858 $ 29,237 Federal funds sold 150 136,180 Money market funds and interest-bearing deposits in other banks   283,807   93,503 Cash and cash equivalents 317,815 258,920   Securities available for sale, at fair value 312,336 289,551 Non-covered loans held for sale, at the lower of cost or fair value 65,677 60,234 Federal Home Loan Bank and Pacific Coast Bankers Bank stock, at cost 14,426 15,019 Non-covered loans, net of allowance for loan losses of $51,010 as of March 31, 2011 and $52,047 as of December 31, 2010 1,330,122 1,415,646

Covered loans, net of allowance for loan losses of $51,010 as of March 31, 2011 and $52,047 as of December 31, 2010

110,753 116,283 Premises and equipment, net 13,160 13,532 Core deposit intangible, net 449 464 Customers' liability on acceptances 1,819 2,287 Non-covered other real estate owned 144 937 Covered other real estate owned 1,405 1,459 Accrued interest receivable 5,489 5,509 Deferred income taxes, net 14,556 14,383 Investments in affordable housing partnerships 10,469 10,824 Cash surrender value of life insurance 12,890 12,791 Income tax receivable 13,298 14,277 Prepaid assessment fees 6,902 7,864 FDIC loss share receivable 21,849 23,991 Other assets   6,559   6,308 Total $ 2,260,118 $ 2,270,279   LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Deposits: Noninterest-bearing $ 408,843 $ 396,973 Interest-bearing   1,370,763   1,374,021 Total deposits 1,779,606 1,770,994   Acceptances outstanding 1,819 2,287 Accrued interest payable 4,771 5,113 Other borrowed funds 167,749 188,670 Long-term subordinated debentures 18,557 18,557 Accrued expenses and other liabilities   8,709   10,646 Total liabilities 1,981,211 1,996,267 Commitments and Contingencies Shareholders' Equity Preferred stock, Series A 53,472 53,409 Common stock 187,892 187,754 Retained earnings 36,135 32,000 Accumulated other comprehensive income, net of tax   1,408   849 Total shareholders' equity   278,907   274,012 Total $ 2,260,118 $ 2,270,279     Tangible common equity per common share $ 5.61 $ 5.49 Tangible common equity to tangible assets 9.91 % 9.65 %         CENTER FINANCIAL CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited)       Three Months

Ended

3/31/2011 12/31/2010 3/31/2010   Interest and Dividend Income: Interest and fees on loans $ 21,161 $ 21,879 $ 20,599 Interest on federal funds sold 42 125 60 Interest on investment securities   1,784     1,708     2,944   Total interest and dividend income 22,987 23,712 23,603   Interest Expense: Interest on deposits 4,634 4,954 5,461 Interest expense on long-term subordinated debentures 142 145 140 Interest on borrowed funds   1,542     1,677     1,603   Total interest expense 6,318 6,776 7,204   Net interest income before provision for loan losses 16,669 16,936 16,399 Provision for loan losses   6,000     6,010     7,000   Net interest income after provision for loan losses 10,669 10,926 9,399   Noninterest Income: Customer service fees 1,800 1,947 2,031 Fee income from trade finance transactions 616 750 658 Wire transfer fees 313 334 281 Gain on sale of loans 3,752 (100 ) - Net gain on sale of securities available for sale - - 2,209 Loan service fees 662 473 160 Increase in FDIC loss share receivable 49 Other income   508     1,526     379   Total noninterest income 7,700 4,930 5,718   Noninterest Expense: Salaries and employee benefits 5,113 5,086 4,340 Occupancy 1,345 1,372 1,195 Furniture, fixtures, and equipment 603 672 507 Data processing 669 730 464 Legal fees 397 329 306 Accounting and other professional service fees 572 344 315 Business promotion and advertising 354 467 257 Supplies and communication 348 478 264 Security service 293 293 235 Regulatory assessment 1,053 1,033 986 Merger related expenses 437 717 - OREO related expenses

474

441 959 Other operating expenses  

1,321

    528     1,035   Total noninterest expense   12,979     12,490     10,863     Income before income tax provision (benefit) 5,390 3,366 4,254 Income tax provision (benefit)   505     (3,084 )   1,487     Net income 4,885 6,450 2,767   Preferred stock dividends and accretion of preferred stock discount   (750 )   (750 )   (29,752 ) Net income (loss) available to common shareholders   4,135     5,700     (26,985 )   Other comprehensive income - unrealized gain (loss) on available-for-sale securities, net of income tax expense (benefit)   408     (2,573 )   (1,248 )   Comprehensive income $ 5,293   $ 3,877   $ 1,519     Earnings (loss) per share: Basic $ 0.10   $ 0.14   $ (1.27 ) Diluted $ 0.10   $ 0.14   $ (1.27 )   Weighted average shares outstanding - basic   39,825,609     39,909,816     21,286,403   Weighted average shares outstanding - diluted   39,897,740     39,990,291     21,286,403           CENTER FINANCIAL CORPORATION SELECTED FINANCIAL DATA (Unaudited) (Dollars in thousands)   Three Months Ended 3/31/2011   12/31/2010   3/31/2010   Annualized   Annualized   Annualized Average Rate/ Average Rate/ Average Rate/ Balance Yield Balance Yield Balance Yield Assets:   Interest-earning assets: Loans $ 1,556,504 5.51 % $ 1,535,008 5.64 % $ 1,474,122 5.67 % Federal funds sold 72,653 0.23 212,010 0.23 103,624 0.23 Investments   306,637 2.36   303,262 2.23   376,699 3.17 Total interest-earning assets   1,935,794 4.82   2,050,280 4.58   1,954,445 4.90 Noninterest - earning assets: Cash and due from banks 247,881 122,498 84,983 Bank premises and equipment, net 13,432 13,729 13,231 Customers' acceptances outstanding 2,138 1,853 2,193 Accrued interest receivables 4,945 5,133 6,437 Other assets   92,925   93,296   70,425 Total noninterest-earning assets   361,321   236,509   177,269   Total assets $ 2,297,115 $ 2,286,789 $ 2,131,714   Liabilities and Shareholders' Equity: Interest-bearing liabilities: Deposits: Money market and NOW accounts $ 525,538 1.10 % $ 505,401 1.09 % $ 492,797 1.07 % Savings 87,790 2.58 88,269 2.62 91,507 2.71 Time certificates of deposit over $100,000 461,539 1.25 505,930 1.33 522,126 1.83 Other time certificates of deposit   325,146 1.54   317,901 1.60   234,163 2.06 1,400,013 1.34 1,417,501 1.39 1,340,593 1.65 Other borrowed funds 184,910 3.38 168,804 3.94 148,239 4.39 Long-term subordinated debentures   18,557 3.10   18,557 3.10   18,557 3.06 Total interest-bearing liabilities   1,603,480 1.60   1,604,862 1.68   1,507,389 1.94 Noninterest-bearing liabilities: Demand deposits   396,251   390,479   350,135 Total funding liabilities 1,999,731 1.28 % 1,995,341 1.35 % 1,857,524 1.57 % Other liabilities   21,171   17,762   15,742 Total noninterest-bearing liabilities 417,422 408,241 365,877 Shareholders' equity   276,213   273,686   258,448 Total liabilities and shareholders' equity $ 2,297,115 $ 2,286,789 $ 2,131,714   Net interest income Cost of deposits 1.05 % 1.09 % 1.31 % Net interest spread 3.22 % 2.91 % 2.97 % Net interest margin 3.49 % 3.28 % 3.41 %         CENTER FINANCIAL CORPORATION SELECTED FINANCIAL DATA (Unaudited) (Dollars in thousands)           Non-covered Loans 3/31/11 12/31/10 9/30/10 6/30/10 3/31/10 Real Estate: Construction $ 14,182 $ 14,803 $ 14,987 $ 15,052 $ 16,620 Commercial 880,723 914,003 918,882 937,792 985,479 Commercial: Commercial 276,180 315,285 279,450 296,195 299,738 Trade Finance 66,243 71,174 65,666 53,342 43,370 SBA 100,712 101,683 69,029 60,531 65,460 Others: Consumer 69,699 71,279 68,968 71,895 71,980 Other   40,038     40,039     50,219   40,024   39,792 Non-covered Loans 1,447,777 1,528,266 1,467,201 1,474,831 1,522,439   Less: Allowance for Losses 51,010 52,047 54,460 58,435 61,011 Deferred Loan Fee (Cost) (649 ) (523 ) 31 188 290 Discount on SBA Loans Retained   1,617     862     936   997   799 Net Non-covered Loans $ 1,395,799   $ 1,475,880   $ 1,411,774 $ 1,415,211 $ 1,460,339     Covered Loans 3/31/11 12/31/10 9/30/10 6/30/10 Real Estate: Construction $ - $ - $ - $ - Commercial 67,525 72,249 73,043 76,280 Commercial Commercial 9,589 8,977 9,698 12,388 Trade Finance - - - - SBA 34,355 35,152 29,022 32,438 Others: Consumer - - - - Other   294     915     911   1,256 Covered Loans 111,763 117,293 112,674 122,362   Less: Allowance for Losses   1,010     1,010     -   - Net Covered Loans $ 110,753   $ 116,283   $ 112,674 $ 122,362     Total Loans 3/31/11 12/31/10 9/30/10 6/30/10 3/31/10 Real Estate: Construction $ 14,182 $ 14,803 $ 14,987 $ 15,052 $ 16,620 Commercial 948,248 986,252 991,925 1,014,072 985,479 Commercial: Commercial 285,769 324,262 289,148 308,583 299,738 Trade Finance 66,243 71,174 65,666 53,342 43,370 SBA 135,067 136,835 98,051 92,969 65,460 Others: Consumer 69,699 71,279 68,968 71,895 71,980 Other   40,332     40,954     51,130   41,280   39,792 Total Loans 1,559,540 1,645,559 1,579,875 1,597,193 1,522,439   Less: Allowance for Losses 52,020 53,057 54,460 58,435 61,011 Deferred Loan Fees (649 ) (523 ) 31 188 290 Discount on SBA Loans Retained   1,617     862     936   997   799 Net Loans   1,506,552     1,592,163     1,524,448   1,537,573   1,460,339     As a percentage of total loans: 3/31/11 12/31/10 9/30/10 6/30/10 3/31/10 Real Estate: Construction 0.9 % 0.9 % 0.9 % 0.9 % 1.1 % Commercial 60.8 59.9 62.8 63.5 64.7 Commercial: Commercial 18.3 19.7 18.3 19.3 19.7 Trade Finance 4.2 4.3 4.2 3.3 2.8 SBA 8.7 8.3 6.2 5.8 4.3 Others: Consumer 4.5 4.3 4.4 4.5 4.7 Other   2.6     2.5     3.2   2.6   2.6 Total Loans   100.0     100.0     100.0   100.0   100.0     3/31/11 12/31/10 9/30/10 6/30/10 3/31/10 Deposits Demand deposits (noninterest-bearing) $ 408,843 $ 396,973 $ 383,508 $ 397,598 $ 360,520 Money market accounts and NOW 531,580 471,132 497,362 505,217 445,999 Savings   88,423     87,484     89,067   94,486   90,294 1,028,846 955,589 969,937 997,301 896,813 Time deposits Less than $100,000 309,311 334,341 302,745 303,441 227,909 $100,000 or more   441,449     481,064     519,599   499,253   500,590 Total deposits $ 1,779,606   $ 1,770,994   $ 1,792,281 $ 1,799,995 $ 1,625,312   As a percentage of total deposits: Demand deposits (noninterest-bearing) 23.0 % 22.4 % 21.4 % 22.1 % 22.2 % Money market accounts and NOW 29.9 26.6 27.8 28.1 27.4 Savings   5.0     4.9     4.9   5.2   5.6 57.8 53.9 54.1 55.4 55.2 Time deposits Less than $100,000 17.4 18.9 16.9 16.9 14.0 $100,000 or more   24.8     27.2     29.0   27.7   30.8 Total deposits   100.0     100.0     100.0   100.0   100.0         CENTER FINANCIAL CORPORATION SELECTED FINANCIAL DATA (Unaudited) (Dollars in thousands) 3/31/11   12/31/10   3/31/10 Non-covered nonperforming loans: Real estate: Construction $ 5,738 $ 6,108 $ 7,008 Commercial - Real Estate 21,490 29,167 49,088 Commercial Commercial - Business 5,263 5,696 8,871 Trade Finance 100 - 1,498 SBA 5,278 3,896 3,612 Other Consumer 383 651 348 Other   -   -   - Total non-covered nonperforming loans 38,252 45,518 70,425 Guaranteed portion of nonperforming SBA loans   4,110   3,293   4,705 Total non-covered nonperforming loans, net of SBA guarantees 34,142 42,225 65,720 Other real estate owned   144   937   2,993   Total non-covered nonperforming assets, net of SBA guarantees $ 34,286 $ 43,162 $ 68,713   Performing TDR's not included above $ 24,541 $ 21,377 $ 9,811   Ratios: Nonperforming loans, net of SBA guarantees as a percent of total non-covered loans 2.36 % 2.76 % 4.32 % Nonperforming assets, net of SBA guarantees as a percent of non-covered loans and OREO 2.37 2.82 4.81 Allowance for loan losses to non-covered nonperforming loans, net of SBA guarantees 149.4 123.3 92.8   Delinquency: Delinquent non-covered loans 30-89 days past due, net of SBA guarantees $ 10,352 $ 12,732 $ 28,006 Total non-covered nonperforming loans, net of SBA guarantees   34,142   42,225   65,720 Total delinquent non-covered loans $ 44,494 $ 54,957 $ 93,726   Covered nonperforming assets: Covered nonperforming loans $ 14,273 $ 15,021 $ 10,890 Covered other real estate owned   1,405   1,459   1,459 Total covered nonperforming assets $ 15,678 $ 16,480 $ 12,349   Ratios: Covered nonperforming loans to total covered loans 12.77 % 13.33 % 9.67 % Covered nonperforming assets to total assets 0.69 0.73 0.54   Total nonperforming assets, net of SBA guarantees (combined): Total nonperforming loans, net of SBA guarantees $ 48,415 $ 57,246 $ 76,610 Other real estate owned   1,549   2,396   4,452 Total nonperforming assets, net of SBA guarantees $ 49,964 $ 59,642 $ 81,062   Ratios (combined): Nonperforming loans, net of SBA guarantees to total gross loans 3.10 % 3.48 % 3.42 % Nonperforming assets, net of SBA guarantees to total assets 2.21 2.63 2.65     Three Months Year Three Months Ended Ended Ended 3/31/11 12/31/10 3/31/10 Balances (non-covered loans): Average total non-covered loans outstanding during the period $ 1,494,492 $ 1,493,526 $ 1,534,369 Total non-covered loans outstanding at end of period $ 1,446,808 $ 1,527,928 $ 1,521,350   Allowance for Loan Losses (non-covered loans): Balance at beginning of period $ 52,047 $ 58,543 $ 58,543 Charge-offs: Construction Real Estate 371 947 - Commercial Real Estate 5,246 20,296 3,659 Commercial - Business 1,251 8,114 532 Trade Finance 200 767 - SBA 370 1,075 331 Consumer 303 1,448 190 Other   -   -   - Total charge-offs 7,741 32,647 4,712 Recoveries Construction Real Estate 366 561 43

Commercial Real Estate

191 1,357 -

Commercial - Business

63 2,890 53 Trade Finance - - - SBA 18 189 40 Consumer 66 154 44 Other   -   -   - Total recoveries   704   5,151   180 Net loan charge-offs 7,037 27,496 4,532 Provision for loan losses (non-covered loans)   6,000   21,000   7,000 Balance at end of period $ 51,010 $ 52,047 $ 61,011   Ratios (non-covered loans): Net loan charge-offs to average non-covered loans 1.91 % 1.84 % 1.20 % Provision for loan losses to average non-covered loans 1.63 1.41 1.85 Allowance for loan losses to gross non-covered loans at end of period 3.53 3.41 4.01 Allowance for loan losses to non-covered nonperforming loans 133.35 114.34 86.63 Net loan charge-offs to allowance for loan losses at end of period 55.95 52.83 30.13 Net loan charge-offs to provision for loan losses 117.28 130.93 64.74         CENTER FINANCIAL CORPORATION SELECTED FINANCIAL DATA (Unaudited)           As of and

for the three months ended

Performance ratios: 3/31/11 12/31/10 3/31/10 Return on average assets 0.86 % 1.12 % 0.53 % Return on average equity 7.17 9.35 4.34 Efficiency ratio 53.26 57.12 49.12 Net loans to total deposits at period-end 84.66 89.90 89.85 Net loans to total assets at period-end 66.66 70.07 70.15   Capital ratios: Leverage capital ratio Consolidated Company 12.85 % 12.74 % 12.82 % Center Bank 12.67 12.50 12.46 Tier 1 risk-based capital ratio Consolidated Company 19.14 17.60 16.94 Center Bank 18.86 17.26 16.45 Total risk-based capital ratio Consolidated Company 20.42 18.87 18.23 Center Bank 20.14 18.53 17.73         CENTER FINANCIAL CORPORATION RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES (Unaudited) (Dollars in thousands, except per share data)       3/31/11 12/31/10 3/31/10   Total shareholders' equity $ 278,907 $ 274,012 $ 257,124 Less: Preferred stock (53,472 ) (53,409 ) (53,227 ) Common stock warrant (1,026 ) (1,026 ) (1,026 ) Intangible assets, net (449 ) (464 ) - Tangible common equity $ 223,960 $ 219,113 $ 202,871   Total assets $ 2,260,118 $ 2,270,279 $ 2,081,618 Less: Intangible assets, net (449 ) (464 ) - Tangible assets $ 2,259,669 $ 2,269,815 $ 2,081,618   Common shares outstanding 39,908,514 39,914,686 39,895,661   Tangible common equity per common share $ 5.61 $ 5.49 $ 5.09 Tangible common equity to tangible assets 9.91 % 9.65 % 9.75 %