Nara Bancorp, the holding company of Nara Bank, has closed bulk sale of its problem loans that were transferred to loans held-for-sale at 30 June 2010.

After subtracting the loan sale advisor fee, the company received cash proceeds of $38.8m from the sale of $61.1m of these loans.

The loan sale consisted of commercial real estate loans secured by hospitality (44.6%), retail (21.8%), gas station/car wash (17.9%), and mixed-use (15.7%) properties.

Approximately 43% of the loans sold were related to properties located in California, primarily in markets outside of the major metropolitan areas. The remainder of the loans related to properties located outside of California.

Nara Bancorp president and CEO of Alvin Kang said that the bulk sale was an efficient mechanism for disposing of problem assets outside of our primary markets and improving our credit quality in the process.

“Following this sale, we have significantly reduced our exposure to areas that have experienced the most economic weakness and have had the most significant declines in collateral valuations. We will continue to be aggressive in further reducing our level of problem assets, which could include additional loan sales,” Kang said.

Keefe, Bruyette & Woods served as the loan sale adviser to Nara Bank for the bulk sale.