Shares in Preferred Bank Los Angeles dropped 12 percent Friday after shares in the bank were downgraded by D.A. Davidson.

The investment firm said the Los Angeles-based independent commercial bank’s construction portfolio has become a source of credit issues now that “economic conditions have changed for the worse.”

The firm said PFBC’s construction exposure to the Inland Empire of roughly $23.8 million, or 1.9 percent of its total loans, and the $53.2 million in commercial real estate loans, or 4.4 percent of total loans, has become more of a concern as this market continues to weaken.

Shares in Preferred Bank dropped 12 percent to $8.28 in early trading Friday. Shares have shed 66 percent so far this year.