exv10w3






EXHIBIT 10.3




UNITED STATES OF AMERICA

BEFORE THE

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

WASHINGTON, D.C.




	 	 	 	 
	 	 	 
	Written Agreement by and between
	 	 	 
	 

	 	 	          Docket No. 09-128-WA/RB-HC
	UCBH HOLDINGS, INC.
	 	 	 
	San Francisco, California
	 	 	 
	 
	 	 	 
	and
	 	 	 
	 
	 	 	 
	FEDERAL RESERVE BANK OF 

SAN FRANCISCO
	 	 	 
	San Francisco, California
	 	 	 
	 
	 	 	 
	 	 
	 





          WHEREAS, UCBH Holdings, Inc., San Francisco, California (“UCBH”), a registered bank holding
company, owns and controls United Commercial Bank, San Francisco, California (the “Bank”), a state
chartered nonmember bank, and various nonbank subsidiaries;




          WHEREAS, it is the common goal of UCBH and the Federal Reserve Bank of San Francisco (the
“Reserve Bank”) to maintain the financial soundness of UCBH so that UCBH may serve as a source of
strength to the Bank;




          WHEREAS, UCBH and the Reserve Bank have mutually agreed to enter into this Written Agreement
(the “Agreement”); and




          WHEREAS, on September 9, 2009, the board of directors of UCBH, at a duly constituted meeting,
adopted a resolution authorizing and directing Joseph J. Jou to enter into this Agreement on behalf
of UCBH, and consenting to compliance with each and every provision of this Agreement by UCBH and
its institution-affiliated parties, as defined in sections 3(u) and




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8(b)(3) of the Federal Deposit Insurance Act, as amended (the “FDI Act”) (12 U.S.C. §§ 1813(u) and
1818(b)(3)).




          NOW, THEREFORE, UCBH and the Reserve Bank agree as follows:




Source of Strength




          1.      The board of directors of UCBH shall take appropriate steps to ensure that the Bank
complies with any order, or other supervisory action, entered into with the Bank’s federal or state
regulators.




Capital Plan




          2.      Within 60 days of this Agreement, UCBH shall submit to the Reserve Bank an acceptable
written plan to maintain sufficient capital at UCBH, on a consolidated basis, and at the Bank, as a
separate legal entity on a stand-alone basis. The plan shall, at a minimum, address, consider, and
include:




                    (a)      The consolidated organization’s and the Bank’s current and future capital requirements,
including compliance with the Capital Adequacy Guidelines for Bank Holding Companies: Risk-Based
Measure and Tier 1 Leverage Measure, Appendices A and D of Regulation Y of the Board of Governors
of the Federal Reserve System (the “Board of Governors”)(12 C.F.R. Part 225, App. A and D) and the
applicable capital adequacy guidelines for the Bank issued by the Bank’s federal regulator;



                    (b)      the adequacy of the Bank’s capital in relation to its risk profile, taking into account
the volume of criticized and classified credits, migration analysis of loan grades, concentrations
of credit, allowance for loan and lease losses (“ALLL”), current and projected asset growth, and
projected retained earnings;



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                    (c)      the results of loan portfolio stress tests that are backtested and updated on a quarterly
basis to reflect changes in loss experience, changes in the economic outlook, and changes in other
model assumptions;



                    (d)      the source and timing of additional funds necessary to fulfill the consolidated
organization’s and the Bank’s future capital requirements;



                    (e)      supervisory requests for additional capital at the Bank or the requirements of any
supervisory action imposed on the Bank by its federal or state regulator; and



                    (f)      the requirements of section 225.4(a) of Regulation Y of the Board of Governors (12 C.F.R.
§ 225.4(a)) that UCBH serve as a source of strength to the Bank.



          3.      UCBH shall notify the Reserve Bank, in writing, no more than 30 days after the end of any
quarter in which UCBH’s consolidated capital ratios or the Bank’s capital ratios (total risk-based,
tier 1 risk-based, or leverage) fall below the plan’s minimum ratios. Together with the
notification, UCBH shall submit an acceptable written plan that details the steps UCBH will take to
increase its and/or the Bank’s capital ratios above the plan’s minimums.




Dividends and Distributions




          4.      (a)      UCBH shall not declare or pay any dividends without the prior written approval of the
Reserve Bank and the Director of the Division of Banking Supervision and Regulation (the
“Director”) of the Board of Governors.




                   (b)      UCBH shall not directly or indirectly take dividends or any other form of payment
representing a reduction in capital from the Bank without the prior written approval of the Reserve
Bank.



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                    (c)      UCBH and its nonbank subsidiaries shall not make any distributions of interest, principal,
or other sums on subordinated debentures or trust preferred securities without the prior written
approval of the Reserve Bank and the Director.



                    (d)      All requests for prior approval shall be received by the Reserve Bank at least 30 days
prior to the proposed dividend declaration date, proposed distribution on subordinated debentures,
and required notice of deferral on trust preferred securities. All requests shall contain, at a
minimum, current and projected information on UCBH’s capital, earnings, and cash flow; the Bank’s
capital, asset quality, earnings, and ALLL (including updated stress test results); and
identification of the sources of funds for the proposed payment or distribution. For requests to
declare or pay dividends, UCBH must also demonstrate that the requested declaration or payment of
dividends is consistent with the Board of Governors’ Policy Statement on the Payment of Cash
Dividends by State Member Banks and Bank Holding Companies, dated November 14, 1985 (Federal
Reserve Regulatory Service, 4-877 at page 4-323).



Debt and Stock Redemption




          5.      (a)      UCBH and any nonbank subsidiary shall not, directly or indirectly, incur, increase, or
guarantee any debt without the prior written approval of the Reserve Bank. All requests for prior
written approval shall contain, but not be limited to, a statement regarding the purpose of the
debt, the terms of the debt, and the planned source(s) for debt repayment, and an analysis of the
cash flow resources available to meet such debt repayment.




                   (b)      UCBH shall not, directly or indirectly, purchase or redeem any shares of its stock without
the prior written approval of the Reserve Bank.



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Cash Flow Projections




          6.      Within 60 days of this Agreement, UCBH shall submit to the Reserve Bank a written statement
of UCBH’s planned sources and uses of cash for debt service, operating expenses, and other purposes
(“Cash Flow Projection”) for the remainder of 2009 and 2010. UCBH shall submit to the Reserve Bank
a Cash Flow Projection for each calendar year subsequent to 2010 at least one month prior to the
beginning of that calendar year.




Compliance with Laws and Regulations




          7.      (a)      In appointing any new director or senior executive officer, or changing the
responsibilities of any senior executive officer so that the officer would assume a different
senior executive officer position, UCBH shall comply with the notice provisions of section 32 of
the FDI Act (12 U.S.C. § 1831i) and Subpart H of Regulation Y of the Board of Governors (12 C.F.R.
§§ 225.71 et seq.).




                    (b)      UCBH shall comply with the restrictions on indemnification and severance payments of
section 18(k) of the FDI Act (12 U.S.C. § 1828(k)) and Part 359 of the Federal Deposit Insurance
Corporation’s regulations (12 C.F.R. Part 359).



Progress Reports




          8.      Within 30 days after the end of each calendar quarter following the date of this Agreement,
the board of directors shall submit to the Reserve Bank written progress reports detailing the form
and manner of all actions taken to secure compliance with the provisions of this Agreement and the
results thereof, and a parent company only balance sheet, income statement, and, as applicable,
report of changes in stockholders’ equity.




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Approval and Implementation of Plan




          9.      (a)      UCBH shall submit a written capital plan that is acceptable to the Reserve Bank within
the applicable time period set forth in paragraph 2 of this Agreement.




                   (b)      Within 10 days of approval by the Reserve Bank, UCBH shall adopt the approved capital
plan. Upon adoption, UCBH shall promptly implement the approved plan, and thereafter fully comply
with it.



                   (c)      During the term of this Agreement, the approved capital plan shall not be amended or
rescinded without the prior written approval of the Reserve Bank.



Communications




          10.     All communications regarding this Agreement shall be sent to:





	 	(a)	 	Mr. Richard J. Shershenovich

Examining Officer

Regional and Foreign Institutions Group

Banking Supervision and Regulation

Federal Reserve Bank of San Francisco

Los Angeles Branch

950 South Grand Avenue

Los Angeles, California 90015
	 
	 	(b)	 	Mr. Joseph J. Jou

Chairman

UCBH Holdings, Inc.

555 Montgomery Street

San Francisco, California 94111
	 
	 	(c)	 	Ms. Doreen Woo Ho

Acting President and Chief Executive Officer

UCBH Holdings, Inc.

555 Montgomery Street

San Francisco, California 94111




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Miscellaneous




          11.     Notwithstanding any provision of this Agreement, the Reserve Bank may, in its sole
discretion, grant written extensions of time to UCBH to comply with any provision of this
Agreement.




          12.     The provisions of this Agreement shall be binding upon UCBH and its institution-affiliated
parties, in their capacities as such, and their successors and assigns.




          13.     Each provision of this Agreement shall remain effective and enforceable until stayed,
modified, terminated, or suspended in writing by the Reserve Bank.




          14.     The provisions of this Agreement shall not bar, estop, or otherwise prevent the Board of
Governors, the Reserve Bank, or any other federal or state agency from taking any other action
affecting UCBH, the Bank, any nonbank subsidiary of UCBH, or any of their current or former
institution-affiliated parties and their successors and assigns.




          15.     Pursuant to section 50 of the FDI Act (12 U.S.C. § 1831aa), this Agreement is enforceable
by the Board of Governors under section 8 of the FDI Act (12 U.S.C. § 1818).




          IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the 9th day of
September, 2009.




	 	 	 	 	 	 	 
	UCBH HOLDINGS, INC.	 	FEDERAL RESERVE BANK

OF SAN FRANCISCO
	 
	 	 	 	 	 	 
	By:

	 	/s/ Joseph J. Jou
	 	By:
	 	/s/ Kenneth R. Binning
	 

	 	Joseph J. Jou
	 	 	 	Kenneth R. Binning
	 

	 	Chairman
	 	 	 	Vice President







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