Editor’s note: Story replaces an earlier version that incorrectly stated Commerce National’s capitalization ratio, assets and loan amounts.
Newport Beach based Commerce National Bank is set to receive a $5 million investment from the government to stimulate lending.
Commerce National’s application to receive money as part of the government’s Capital Purchase Plan was pre-approved, the bank said in a release Wednesday.
The money, which will be exchanged for preferred stock and warrants, will increase the health of the bank’s balance sheet, it said.
Its core capital ratio, a measure of financial health for banks, stood at 11.8% as of Sept. 30, according to the government.
Bank regulators prefer to see at least a 5% ratio for healthy capitalization.
Commerce National had $262 million in assets as of Sept. 30.
With boosted lending power, the bank will be able to better serve its business customers, Commerce National said.
The government is investing money in healthy banks as part of a plan that also includes shoring up the balance sheets of nine of the nation’s largest banks.
In October, the government invested $1.2 million in Westminster-based Saigon National Bank.
Started in 2005, Saigon National lends to businesses in the Vietnamese-American enclave of Little Saigon, which covers parts of Westminster, Garden Grove, Santa Ana and Huntington Beach.
