Nara Bancorp Inc , which posted a better-than-expected third-quarter profit, said it had commenced an underwritten public offering of about $55 million of its common stock, nearly a fifth of its current market value.

The Los Angeles-based bank, which focuses on the Korean-American population, said the capital would be used to bolster its capital position and to support its pending merger with Center Financial Corp .

The proceeds will also be used to support growth in the banking business and to pay off debt, the bank said in a statement.

Nara Bancorp intends to grant the underwriters an option to purchase up to an additional 15 percent of the amount of common stock offered to cover over-allotments.

Separately, the company said it earned 23 cents per share in the third quarter, topping analysts estimate of 16 cents a share, according to Thomson Reuters I/B/E/S.

Shares of the company, that offers commercial banking loan and deposit products through its wholly-owned subsidiary Nara Bank, closed at $6.92 on Monday on Nasdaq.