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The Complaint charges UCBH and certain of the Company's current and former executive officers with violations of federal securities laws. UCBH operates as the bank holding company for United Commercial Bank, which provides personal and commercial banking services to small- and medium-sized businesses, business executives, professionals and other individuals, and primarily engages in generating deposits and originating loans.
The Complaint alleges that throughout the Class Period defendants knew or recklessly disregarded that their public statements concerning UCBH's business, operations and prospects were materially false and misleading. Specifically, the defendants made false and/or misleading statements and/or failed to disclose that: (1) loan terms were inappropriately modified, including the extension of terms, the lowering of interest rates, and the improper use of interest reserve accounts to delay negative consequences; (2) the Company had delayed the recognition of risk rating downgrades and specific reserves; (3) the Defendants misrepresented the credit risk of the Company's loan portfolio; (4) the Company failed to properly reserve for loan losses and record impairment losses on non-performing loans and other real estate owned assets; (5) Defendants misstated the Company's loan loss provision and related allowance, including charge-offs and the resulting change in non-performing loan levels; (6) the Company's financial results were not prepared in accordance with Generally Accepted Accounting Principles ("GAAP"); (7) the Company lacked adequate internal and financial controls; and (8) as a result of the above, the Company's financial statements were overstated and materially false and misleading at all relevant times.
On September 8, 2009, UCBH shocked investors when the Company disclosed the conclusions of an Investigation Subcommittee of the Board Audit Committee regarding the recognition of impairment losses on nonperforming loans and other real estate owned assets. According to the Company, the Subcommittee's report identified problems resulting both from weaknesses in the Bank's internal controls and from deliberate and improper actions and omissions of certain Bank Officers, and concluded that those problems were driven by an apparent desire to downplay deteriorating financial conditions by delaying or abating risk rating downgrades and minimizing the Bank's overall loan loss allowance. Moreover, UCBH disclosed that the report raised serious concerns regarding the actions of certain current and former officers at various levels of the Bank's management.
As a result of this news, shares of UCBH declined $0.17 per share, or 14.29%, to close on September 8, 2009, at $1.02 per share, on unusually heavy volume.
If you are a member of the class described above, you may, no later than November 10, 2009, request that the court appoint you lead plaintiff of the class. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs make important decisions that could affect the overall recovery for class members, including decisions concerning settlement.
If you wish to discuss this action, or have any questions concerning this notice or your rights, please contact us, toll free, at (888) 529-4787 or by email at info.newcases@kmllp.com
Kirby McInerney LLP has specialized in complex litigation, including securities class actions, for several decades. The firm has repeatedly demonstrated its expertise in this field, and has been recognized by various courts that have appointed the firm to major positions in consolidated and multi-district litigation. The firm's efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling hundreds of millions of dollars, and the firm's achievements and quality of service have been chronicled in numerous published decisions. More information about the firm, class actions in general, or about the role of the lead plaintiffs in a securities class action can be obtained through Kirby McInerney LLP's website at http://www.kmllp.com
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: Kirby McInerney LLP
CONTACT: Kirby McInerney LLP Francisco Loya floya@kmllp.com Steven Cohn, Esq. 888-529-4787 825 Third Avenue, 16th Floor New York, NY 10022
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