Opus Bank (NYSE: OPB)
A class action has been filed in the United States District Court for the Central District of California on behalf of purchasers of Opus Bank (NYSE: OPB) common stock between July 28, 2014 and October 17, 2016 (the “Class Period”).
The complaint charges Opus and certain of its officers with violations of the Securities Exchange Act of 1934. Opus is a California-chartered commercial bank that provides various banking products, services and solutions for small to mid-sized companies, entrepreneurs, real estate investors, professionals and high net worth individuals. It offers demand deposits, checking accounts, money market accounts, savings accounts and certificates of deposit.
The complaint alleges that throughout the Class Period, defendants made materially false and misleading statements and/or failed to disclose material adverse facts about the Company's business, operations, and prospects, including that certain of the Company's loans were of poor quality and the Company was over-representing the quality of its loans to the public. As a result, the Company had failed to properly account for the loans in violation of Generally Accepted Accounting Principles and would be forced to recognize large charge-offs associated with the loans. As a result of these false statements and/or omissions, Opus securities traded at artificially inflated prices during the Class Period, with its stock price reaching a high of over $39 per share.
Then on October 17, 2016, Opus announced its preliminary third quarter 2016 financial results and disclosed that, “[a]s part of the credit review process of impaired loans, new developments supported charge-offs being recognized on eight loan relationships through the allowance for loan losses at September 30, 2016. Charge-offs were recorded on these eight loan relationships, which have been impacting the provision for loan losses and earnings for the past eight quarters.” As a result of these charge-offs, Opus’s third quarter earnings “will include a $0.59 per diluted share impact,” which is “expected to result in a net loss of approximately $0.05 per diluted share for the third quarter of 2016.” On this news, the price of Opus stock fell $7.25 per share, or 21%, to close at $27.20 per share on October 17, 2016. The stock’s price continued to fall over the next week, declining another $7.10 per share to close at $20.10 per share on October 26, 2016.
If you are a current shareholder and purchased stock between July 28, 2014 and October 17, 2016, and would like to discuss your options of exercising your rights as a shareholder, please contact us.
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