NorCal Community Bancorp Reports First Quarter Earnings, Announces Reversal of Valuation Allowance on Deferred Tax Assets as of

  NorCal Community Bancorp Reports First Quarter Earnings, Announces Reversal
  of Valuation Allowance on Deferred Tax Assets as of March 31, 2013

Business Wire

ALAMEDA, Calif. -- April 19, 2013

NorCal Community Bancorp (the “Company”) (NCLC), parent company for Bank of
Alameda, today reported net income for the three months ended March 31, 2013
of $6.4 million, or $0.60 per diluted share. Included in the 2013 results is a
one-time income tax benefit of $5.9 million resulting from a deferred tax
asset (“DTA”) valuation allowance reversal, offset by a current book tax
provision of $293,000. Pretax income for the first quarter of 2013 was
$793,000, a 195% increase from the $269,000 reported in the first quarter of
2012. The reversal of the DTA valuation allowance combined with net earnings
resulted in tangible book value of $2.48 per share at March 31, 2013, an
increase of $0.59 per share, or 31% over December tangible book value of $1.89
per share. Net income in the first quarter of 2013 was further augmented by a
net gain on sale of other real estate of $585,000.

“The Company has reported profitability in six out of the last seven
consecutive quarters, with the second quarter of 2012 reporting a net loss.
The second quarter loss was determined to be an isolated event associated with
a large loan write-down. The improvement in asset quality, which has been
sustained into the first quarter of 2013, coupled with the removal of the
Bank’s informal agreement with its primary regulators in February 2013
prompted management to determine that those tax assets would more likely than
not be recovered through future taxable income and that maintaining the
valuation allowance was no longer necessary,” stated Jeanette E. Reynolds,
NorCal Community Bancorp’s Chief Financial Officer.

President and CEO, Stephen G. Andrews commented “The determination as to our
ability to realize the full amount of the deferred tax assets validates our
future outlook for the Company fueled by an improving Bay Area economy. The
removal of the informal agreement between the Bank, the FDIC and the
California Department of Financial Institutions in February 2013 was another
positive factor.”

Total loans and leases decreased $3.4 million, or 2.0% to $170.6 million at
March 31, 2013 compared to $174.0 million at March 31, 2012. Included in the
decrease in loans between these two periods was a $6.1 million reduction in
non-performing assets and restructured debt. Total non-performing assets and
restructured debt at March 31, 2013 was $3.1 million, or 1.16% of total
assets, compared to $9.2 million, or 3.4% to total assets at March 31, 2013.

Total deposits at March 31, 2013 were $228.7 million, a decrease of $9.8
million, or 4.1% at March 31, 2013 compared to March 31, 2012. The decrease is
attributed to fluctuating balances with our large depositors. The overall cost
of the deposit base has decreased 17 basis points to 0.19% for the quarter
ended March 31, 2013 compared to 0.36% for the same period in 2012.

In closing, Mr. Andrews stated “This quarter’s results reflect a significant
improvement in value for our shareholders. An improving local economy is
expected to lead to loan growth and improving operating results as we move
forward.”

A copy of the Company’s information and disclosure statement pursuant to
Securities and Exchange Commission Rule 15c2-11 can be found on the home page
of the Company’s website at www.bankofalameda.com under the Investor Relations
section.

Cautionary Statement: This release may contain certain forward-looking
statements that are subject to risks and uncertainties that could cause actual
results and events to differ materially from those stated herein. Words such
as “anticipate,” “believe,” “estimate,” “expect,” “should,” “intend,”
“project,” and words or phrases of similar meaning are intended to identify
forward-looking statements. Management’s assumptions and projections are based
on their anticipation of future events and actual performance may differ
materially from that projected.


NorCal Community Bancorp
FINANCIAL HIGHLIGHTS
(Dollar amounts in thousands, except share and per share data)
(Unaudited)
                                                             
                                               Three Months Ended
                                               March 31,        March 31,
FOR THE PERIOD                                 2013             2012
Total interest income                          $ 2,437          $ 2,625
Total interest expense                          126            194        
Net interest income before provision for         2,311            2,431
loan and lease losses
Provision for loan and lease losses             -              75         
Net interest income after provision for loan     2,311            2,356
and lease losses
Noninterest income                               965              305
Noninterest expense                             2,483          2,392      
Income before income tax benefit                 793              269
Income tax benefit                              (5,647     )    -          
Net Income                                     $ 6,440         $ 269        
                                                                
Basic income per share                         $ 0.61           $ 0.03
Diluted income per share                       $ 0.60           $ 0.03
                                                                
Average shares outstanding                       10,610,716       10,610,716
Diluted average shares for the period            10,660,413       10,611,777
                                                                
SELECTED FINANCIAL RATIOS
(Annualized)
Return on average assets                         10.06      %     0.43       %
Return on average equity                         129.15     %     5.11       %
Yield on earning assets                          3.89       %     4.22       %
Cost of funds                                    0.21       %     0.35       %
Net interest margin                              3.69       %     3.91       %
Efficiency ratio                                 75.80      %     87.43      %
Net charge-offs as a percentage of average       0.43       %     1.39       %
loans and leases
Loan loss provision as a percentage of           0.00       %     0.18       %
average loans and leases
                                                                

                                                         
Financial Highlights - Continued
                                              As of
                                              March 31,     March 31,   %
CONSOLIDATED BALANCE SHEET                    2013          2012        Change
ASSETS
Cash and due from banks
Non-interest bearing                          $ 1,762       $ 1,598     10   %
Interest bearing                                24,448        28,838    -15  %
Investment securities                           58,573        61,077    -4   %
Loans and leases                                170,602       173,999   -2   %
Allowance for loan and lease losses            (3,369  )    (4,305  ) -22  %
Net loans and leases                            167,233       169,694   -1   %
Other real estate                               547           1,734     -68  %
Other assets                                   12,128      6,290    93   %
TOTAL ASSETS                                  $ 264,691    $ 269,231  -2   %
                                                                        
LIABILITIES
Deposits
Non-interest bearing                          $ 72,334      $ 81,385    -11  %
Interest bearing                               156,335     157,118  0    %
Total deposits                                  228,669       238,503   -4   %
Subordinated debentures                         8,248         8,248     0    %
Other liabilities                              1,411       1,216    16   %
TOTAL LIABILITIES                              238,328     247,967  -4   %
                                                                        
SHAREHOLDERS' EQUITY                            26,363        21,264    24   %
TOTAL LIABILITIES AND                                      
SHAREHOLDERS' EQUITY                          $ 264,691    $ 269,231  -2   %
                                                                        
Book value per share                          $ 2.48        $ 2.00
                                                                        
REGULATORY CAPITAL RATIOS
Leverage ratio                                  11.50   %     10.42   %
Tier 1 risk-based capital ratio                 16.06   %     14.07   %
Total risk-based capital ratio                  18.08   %     16.77   %
                                                                        
ASSET QUALITY METRICS
ALLL as a percentage of total loans and         1.97    %     2.47    %
leases
Non-performing assets as a percentage of        0.97    %     2.38    %
total assets
Non-performing assets as a percentage of        8.64    %     25.03   %
total equity + ALLL (Texas ratio)
                                                                        

Contact:

NorCal Community Bancorp
Steve Andrews, 510-748-8468
www.norcalcommunitybancorp.net
 
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