FRESNO, Calif., Dec. 19 /PRNewswire-FirstCall/ -- Dennis R. Woods, President and Chief Executive Officer of United Security Bancshares http://www.unitedsecuritybank.com/ reported that the Board of Directors of United Security Bancshares declared a first quarter 2009 stock dividend of one percent (1%). The stock dividend replaces the quarterly cash dividend and reflects a similar value. The stock dividend will be paid to shareholders of record on January 9, 2009 and the dividend shares will be issued on January 21, 2009.
Regarding the announcement, Woods said, "The Company paid out $25 million from shareholders equity over the past two years in cash dividends and by purchasing shares for retirement, to benefit shareholders. The change in the dividend from cash to stock was employed last quarter as a precaution against the uncertainties in the 1-4 family residential real estate market and its impact on the Company's construction and related land and lot loan portfolio. Those conditions persist but the Company's capital position remains strong. However, the Board of Directors once again decided, given the current uncertainties in the economy and unprecedented declines in real estate valuations in our markets, it is prudent to retain capital in this environment.
Many of our shareholders use the cash dividends to purchase additional shares each quarter and the stock dividend will make that unnecessary. Shareholders who prefer cash may sell all or a portion of the stock dividend shares in the open market to meet their cash needs. This change in dividend policy is in concert with managing the capital of the Company in the best interest of the shareholders. After the uncertainties in the economy subside, the Board of Directors expects to resume paying the quarterly cash dividend."
