Carolina Bank Holdings, Inc. Reports EPS of $0.75 for the Six Months Ended June 30, 2013

Carolina Bank Holdings, Inc. Reports EPS of $0.75 for the Six Months Ended
June 30, 2013

GREENSBORO, N.C., July 29, 2013 (GLOBE NEWSWIRE) -- Carolina Bank Holdings,
Inc. (Nasdaq:CLBH) today reported second quarter 2013 results with highlights
as follows:

Second Quarter 2013 Financial Highlights

  oCarolina Bank, the subsidiary of Carolina Bank Holdings, Inc., continued
    to maintain 'Well Capitalized' status, the highest regulatory capital
    measure. Capital ratios at June 30, 2013 for Carolina Bank improved to
    9.39% for Tier 1 leverage, 12.67% for Tier 1 risk-based, and 15.79% for
    total risk-based.
  oThe warrant to purchase 357,675 shares of common shares was repurchased
    from the U. S. Treasury in April 2013.
  o$5 million of the $16 million in outstanding preferred stock is scheduled
    to be retired in August 2013.
  oAverage non-interest-bearing demand deposits increased 31.3% in the first
    six months of 2013 from the first six months of 2012.
  oNet loan charge-offs declined to $208,000, or 0.20% of average loans
    (annualized), in the second quarter of 2013 from $1,379,000, or 1.18% of
    average loans (annualized), in the second quarter of 2012.
  oNon-performing assets to total assets decreased to 3.07% at June 30, 2013
    from 4.16% at June 30, 2012
  oDiluted net income per common share decreased to $0.75 for the six months
    ended June 2013 from $0.85 for the same period in 2012. Diluted net income
    per common share was $0.34 and $0.58 for the second quarters of 2013 and
    2012, respectively.
  oNet income was $3,188,000 for the six months ended June 30, 2013 compared
    to $3,496,000 for the six months ended June 30, 2012. Net income was
    $1,470,000 and $2,268,000 in the second quarters of 2013 and 2012,
    respectively.
  oNet income available to common shareholders was $1,164,000 in the second
    quarter of 2013 compared to $1,961,000 in the second quarter of 2012.
  oThe net interest margin, computed on a fully taxable basis, was 3.65% in
    the second quarter of 2013 compared to 3.86% in the second quarter of
    2012.

"We continued our goal of building shareholder value in 2013 by increasing our
capital and by strengthening our relationships with customers. We plan to
retire $5 million of our $16 million in preferred stock in August 2013 which
should be accretive to earnings per share," said President and Chief Executive
Officer Robert T. Braswell. "Average loans declined during the first six
months of 2013 due to a challenging commercial lending environment, but we
continued our focus on increasing our commercial relationships as evidenced by
a 31.3% increase in average non-interest-bearing demand deposits in the first
six months of 2013 from the same period in 2012. Our commercial loan pipeline
appears to be strengthening."

"Our mortgage banking revenue for the first six months of 2013 was basically
flat with the first six months of 2012; however, we have seen a shift in the
loan purpose to a higher percentage of originations used for purchasing homes
in 2013 than in 2012. We believe that the ability to maintain our mortgage
banking revenues in the face of the changing mortgage environment speaks well
for our service quality."

"We are continuing our focus in reducing non-performing and classified assets
in 2013 and are pleased that loan charge-offs and classified assets declined
during 2013," said Braswell. "Our net loan charge-offs declined to $208,000 in
the second quarter of 2013 from $1,379,000 in the second quarter of 2012 and
we are striving for additional improvements in our loan quality during the
remainder of 2013."

About the Company

Carolina Bank, the banking subsidiary of Carolina Bank Holdings, Inc., began
banking operations on November 25, 1996. The parent company is a North
Carolina corporation organized in 2000. The bank is engaged in lending and
deposit gathering activities in the Piedmont Triad of North Carolina, with
operations in four counties: Guilford, Alamance, Forsyth and Randolph. The
bank has eight full-service banking locations, four in Greensboro, one in
Asheboro, one in High Point, one in Burlington, and one in Winston-Salem.
Residential mortgage loan production offices are located in Burlington, Chapel
Hill, Hillsborough, and Raleigh in addition to a wholesale residential
mortgage operation in Greensboro. The Company's stock is listed on the NASDAQ
Global Market under the symbol CLBH. Further information is available on the
Company's web site: www.carolinabank.com.

This press release contains forward-looking statements regarding future
events. These statements are only predictions and are subject to risks and
uncertainties that could cause the actual events or results to differ
materially. These risks and uncertainties include risks of managing our
growth, substantial changes in financial markets, regulatory changes, changes
in interest rates, loss of deposits and loan demand to other financial
institutions, and changes in real estate values and the real estate market.
Additional information concerning factors that could cause actual results to
be materially different from those in the forward-looking statements is
contained in the Company's filings with the Securities and Exchange
Commission. Carolina Bank Holdings, Inc. undertakes no obligation to update or
clarify forward-looking statements, whether as a result of new information,
future events or otherwise.


Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Balance Sheets
                                            
                                            June 30,         December 31,
                                            2013             2012
                                            (unaudited)      
                                            (in thousands, except share data)
Assets                                                       
Cash and due from banks                      $6,904         $7,913
Interest-bearing deposits with banks         93,245          7,186
Securities available-for-sale, at fair value 49,445          42,036
Securities held-to-maturity                  9,294           211
Loans held for sale                          56,403          131,762
Loans                                       418,158         461,728
Less allowance for loan losses               (10,131)        (9,944)
Net loans                                   408,027         451,784
Premises and equipment, net                  17,362          17,732
Other real estate owned                      4,031           5,940
Bank-owned life insurance                    10,948          10,765
Other assets                                 13,830          16,539
Total assets                                 $669,489       $691,868
                                                            
Liabilities and Stockholders' Equity                         
Deposits                                                     
Non-interest bearing demand                  $76,754        $73,032
NOW, money market and savings                337,446         343,740
Time                                         167,204         174,153
Total deposits                               581,404         590,925
                                                            
Advances from the Federal Home Loan Bank     2,934           15,982
Securities sold under agreements to          3,237           1,950
repurchase
Subordinated debentures                      19,601          19,563
Other liabilities and accrued expenses       8,121           9,586
Total liabilities                            615,297         638,006
                                                            
Stockholders' equity                                         
Preferred stock, no par value, authorized
1,000,000 shares; issued and outstanding     15,783          15,573
16,000 shares
Common stock, $1 par value; authorized
20,000,000 shares; issued and outstanding    3,419           3,387
3,419,013 in 2013 and 3,387,045 in 2012
Common stock warrants                        --              1,841
Additional paid-in capital                   16,168          15,906
Retained earnings                           17,985          15,408
Stock in directors' rabbi trust              (1,186)         (1,050)
Directors' deferred fees obligation          1,186           1,050
Accumulated other comprehensive income      837             1,747
Total stockholders' equity                   54,192          53,862
Total liabilities and stockholders' equity   $669,489       $691,868



Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Statements of Income (unaudited)
                                                                 
                                        Three Months      Six Months
                                        Ended June30,   Ended June30,
                                        2013     2012     2013      2012
                                        (in thousands, except per share data)
Interest income                                                   
Loans                                    $6,122 $6,887 $12,841 $ 13,972
Investment securities, taxable           260     313     508      619
Investment securities, non taxable       107     100     213      207
Interest from deposits in banks          67      21      85       31
Total interest income                    6,556   7,321   13,647   14,829
                                                                 
Interest expense                                                  
NOW, money market and savings            276     521     596      1,069
Time deposits                            503     664     1,023    1,373
Other borrowed funds                     187     197     375      399
Total interest expense                   966     1,382   1,994    2,841
                                                                 
Net interest income                      5,590   5,939   11,653   11,988
Provision for loan losses                100     --      500      1,460
Net interest income after provision for  5,490   5,939   11,153   10,528
loan losses
Non-interest income                                               
Service charges                          295     318     547      601
Mortgage banking income                  3,586   4,356   7,481    7,525
Gain on sale of investment securities    170     --      192      --
available-for-sale
Other                                    155     134     300      301
Total non-interest income                4,206   4,808   8,520    8,427
                                                                 
Non-interest expense                                              
Salaries and benefits                    4,610   4,404   9,358    8,434
Occupancy and equipment                  747     677     1,494    1,359
Foreclosed property expense              547     574     878      973
Professional fees                        355     263     541      520
Outside data processing                  195     215     454      421
FDIC insurance                           79      207     248      422
Advertising and promotion                285     205     491      380
Stationery, printing and supplies        181     167     334      302
Other                                    535     613     1,118    1,024
Total non-interest expense               7,534   7,325   14,916   13,835
                                                                 
Income before income taxes               2,162   3,422   4,757    5,120
Income tax expense                      692     1,154   1,569    1,624
Net income                              1,470   2,268   3,188    3,496
Dividends and accretion on preferred     306     307     611      609
stock
Net income available to common           $1,164 $1,961 $2,577  $2,887
stockholders
Net income per common share                                       
Basic                                    $0.34  $0.58  $0.76   $0.85
Diluted                                  $0.34  $0.58  $0.75   $0.85

                                                                           
                                                                           
Carolina Bank Holdings, Inc.                                                
Consolidated Financial Highlights                                          
Second Quarter 2013                                                         
(unaudited)                                                                 
                Quarterly                                        Years Ended
                2nd Qtr   1st Qtr   4th Qtr   3rd Qtr   2nd Qtr            
($ in thousands
except for share 2013      2013      2012      2012      2012      2012      2011
data)
                                                                      
EARNINGS                                                               
Net interest     $ 5,590   6,063     6,351     5,848     5,939     24,187   24,095
income
Provision for    $ 100     400       300       600       --       2,360    6,850
loan loss
NonInterest      $ 4,206   4,314     5,655     5,568     4,808     19,650   11,182
income
NonInterest      $ 7,534   7,382     8,323     8,085     7,325     30,243   25,473
expense
Net income      $ 1,470   1,718     2,187     1,819     2,268     7,502    2,397
Net income
available to     $ 1,164   1,413     1,884     1,505     1,961     6,276    1,223
common
stockholders
Basic earnings   $ 0.34    0.42      0.56      0.44      0.58      1.85     0.36
per share
Diluted earnings $ 0.34    0.42      0.55      0.44      0.58      1.85     0.36
per share
Average common
shares           3,403,347 3,387,813 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045
outstanding
Average diluted
common shares    3,423,373 3,398,070 3,420,396 3,387,045 3,387,045 3,395,383 3,387,045
outstanding
                                                                      
PERFORMANCE                                                            
RATIOS
Return on        0.70%     0.84%     1.11%     0.89%     1.18%     0.93%     0.18%
average assets *
Return on
average common   12.04%    14.68%    19.99%    16.75%    23.44%    18.05%    4.03%
equity *
Net interest
margin           3.65%     3.94%     4.01%     3.71%     3.86%     3.89%     3.92%
(fully-tax
equivalent) *
Efficiency ratio 76.50%    70.78%    69.02%    70.55%    67.85%    68.68%    71.66%
# full-time
equivalent       215       215       208       206       200       208       174
employees -
period end
                                                                      
CAPITAL                                                                
Equity to
period-end       8.09%     8.21%     7.79%     7.68%     7.40%     7.79%     6.91%
assets
Common tangible  5.74%     5.89%     5.53%     5.39%     5.13%     5.53%     4.66%
equity to assets
Tier 1 leverage
capital ratio -  9.39%     9.34%     9.23%     9.00%     8.79%     9.23%     8.02%
Bank
Tier 1
risk-based       12.67%    12.23%    11.27%    11.14%    11.12%    11.27%    9.60%
capital ratio -
Bank
Total risk-based
capital ratio -  15.79%    15.28%    14.18%    14.09%    14.12%    14.18%    12.50%
Bank
Book value per   $11.23   11.72    11.30    10.75    10.27    11.30    9.26
common share
                                                                      
ASSET QUALITY                                                          
Net charge-offs $ 208     105       1,080     988       1,379     4,209    7,416
Net charge-offs
to average loans 0.20%     0.09%     0.95%     0.86%     1.18%     0.90%     1.49%
*
Allowance for    $ 10,131  10,239    9,944     10,725    11,112    9,944     11,793
loan losses
Allowance for
loan losses to   2.42%     2.37%     2.15%     2.33%     2.42%     2.15%     2.42%
loans held
invst.
Nonperforming    $16,501  10,806   13,067   21,387   21,771   13,067   22,915
loans
Performing
restructured     $ 14,151  14,391    13,822    11,192    12,207    13,822    18,502
loans
Other real       $ 4,031   7,555     5,940     4,751     6,384     5,940     6,728
estate owned
Nonperforming
loans to loans   3.95%     2.50%     2.83%     4.66%     4.74%     2.83%     4.71%
held for
investment
Nonperforming
assets to total  3.07%     2.72%     2.75%     3.87%     4.16%     2.75%     4.40%
assets
                                                                      
END OF PERIOD                                                          
BALANCES
Total assets     $ 669,489 674,764   691,868   675,746   677,476   691,868   673,325
Total loans held $ 418,158 431,754   461,728   459,323   459,144   461,728   487,031
for investment
Total deposits   $ 581,404 585,954   590,925   588,672   592,103   590,925   596,639
Stockholders'    $ 54,192  55,389    53,862    51,879    50,143    53,862    46,558
equity
                                                                      
AVERAGE BALANCES                                                       
Total assets     $ 671,745 678,373   675,573   675,569   670,339   671,376   668,753
Total earning    $ 627,855 629,687   635,170   631,347   624,183   626,736   621,889
assets
Total loans held $ 423,587 449,704   456,738   459,800   466,412   465,478   498,683
for investment
Total
interest-bearing $ 532,286 512,562   519,595   527,545   528,463   526,237   542,402
deposits
Common
stockholders'    $ 38,764  39,044    37,487    35,750    33,649    34,778    30,337
equity
                                                                      
* annualized for
all periods                                                            
presented
return on average assets and on average common equity are computed using net income     
available to common stockholders

CONTACT: Carolina Bank Holdings, Inc.
         T. Allen Liles, EVP and CFO
         Telephone: 336-286-8746
         Email: a.liles@carolinabank.com