1st Century Bancshares Inc. said its directors have authorized the purchase of up to $5 million worth of its common stock over the next 24 months, which represents 9.2 percent of total common shares.

Shares of the Los Angeles parent of 1st Century Bank have fallen 20 percent since the credit crunch hit last summer. The bank holding company last month reported that second quarter net income had fallen 76 percent to $59,000 compared to the same period a year ago.

“The decision to implement a repurchase program reflects our strong belief in the value of the company,” said Chief Executive Alan Rothenberg in a statement on Thursday. “We continue to be one of the best capitalized banks among our peer group, far exceeding the standard of 10 percent, for being well-capitalized with a total risk-based capital ratio of 24.85 percent.”

1st Century shares, whose price was unchanged on Thursday, were down 25 cents, or 4.6 percent, in Friday morning trading on the Over-the-Counter Bulletin Board.