Bank Of The Cascades Second Quarter 2013 Results With Continued Earnings Resulting From A Non-Recurring Tax Benefit Arising From

   Bank Of The Cascades Second Quarter 2013 Results With Continued Earnings
    Resulting From A Non-Recurring Tax Benefit Arising From Recognition Of
                              Deferred Tax Asset

PR Newswire

BEND, Ore., Aug. 9, 2013

BEND, Ore., Aug. 9, 2013 /PRNewswire/ --Cascade Bancorp (NASDAQ: CACB)
("Company") the holding company for Bank of the Cascades ("Bank"), announced
2013 second quarter results showing continued growth. Net income and
shareholder equity was significantly and positively affected by the
non-recurring release of our deferred tax asset ("DTA") valuation allowance.
The release of the DTA allowance is recorded as a non-recurring $51.7 million
benefit to income taxes in the Company's income statement. The recognition of
DTA indicates that it is more likely than not that future taxable income will
be sufficient to realize the benefit of the Company's tax profile over time.
Also during the second quarter of 2013 the Company recorded non-recurring
charges which we anticipate will position the Company for improved
profitability going forward. The largest of these charges was a $3.8 million
prepayment penalty to extinguish high rate FHLB advances. This payoff is
expected to reduce Company borrowing costs in the future by approximately $500
thousand per quarter.

With the release of DTA at June 30, 2013, stockholders' equity increased to
$187.9 million or $3.95 per share as compared to $140.8 million or $2.97 per
share at December 31, 2012 when net DTA was nil.

The full details of the Company's second quarter 2013 results were filed with
the SEC in the Company's quarterly report on Form 10-Q on August 9, 2013.

Financial Highlights of the Second Quarter and period ended June 30, 2013

  oNet Income for the Second Quarter of 2013: After recognizing the
    non-reoccurring DTA, partially offset by the $3.8 million prepayment
    penalty to extinguish high rate FHLB advances, the Bank reported second
    quarter 2013 net income of $46.4 million.
  oEarnings per Share: Diluted earnings per share for the six months ended
    June 30, 2013, which were largely influenced by recognition of the
    non-recurring DTA, were $1.02 per common share compared to $0.06 per share
    for the six months ended June 30, 2012.
  oStockholder Equity/Book Value Per Share: Stockholder equity increased to
    $187.9 million or $3.95 per share at June 30, 2013 as compared to $140.8
    million or $2.97 per share at December 31, 2012 due to DTA recognition.
  oLoans: Gross loans up $54.4 million or 6.34% compared to December 31,
    2012.
  oDeposits: Total deposits up $28.0 million or 2.60% compared to December
    31, 2012.
  oCredit Quality: Reserve for loan losses at June 30, 2013 was $22.7 million
    or 2.49% of loans compared to $27.3 million or 3.17% of loans at December
    31, 2012.
  oCredit Quality: Non-performing assets were 0.84% of total assets at June
    30, 2013 compared to 1.94% at December 31, 2012.
  oCredit Quality: Substandard loans were reduced by 54.06% to $58.2 million
    at June 30, 2013 as compared to December 31, 2012. Net charge-offs for the
    quarter were $2.9 million mainly related to resolution of substandard
    loans.
  oNet Interest Margin ("NIM"): NIM was 3.75% at June 30, 2013 compared to
    4.11% at December 31, 2012.

"Recognition of the deferred tax asset is a regular occurrence at banks that
have rebounded from periods of operating losses. We believe the DTA was
already largely built into Cascade's current stock price," commented Terry
Zink, President and Chief Executive Officer. "However with the DTA recognition
it reinforces the strength of our capital and our confidence in sustainable
profitability into the future. In doing so we believe this action underscores
that Cascade has fully returned to its standing as a premier banking franchise
in the Northwest." 

Zink continued, "Most importantly for our customers, this means Cascade stands
strong in providing business and consumer credit as well as mortgage loans and
advanced technology to make community banking convenient. We are committed to
growing the health and prosperity of our local economies by partnering with
customers and neighbors who chose the advantages of investing in their
communities by banking local."

Total loans outstanding increased to $928.3 million at June 30, 2013, a year
to date increase of $69.6 million. The growth was attributable to local
lending including owner-occupied commercial real estate, small business loans
and lines, consumer lending, including residential mortgages and increased
shared national credits in the commercial and industrial portfolio.

Loan quality continued to improve with remediation of special mention and
substandard loans. These adversely risk rated loans totaled $107.1 million at
June 30, 2013 as compared to $175.6 million at December 31, 2012. Remediation
was accomplished through payoffs/pay downs, note sales and/or charge offs
related to the restructure of adversely risk rated loans as well as credit
upgrades owing to improved obligor cash flows. Also, non-performing assets as
of June 30, 2013 improved to 0.84% of total assets as compared to 1.94% at
December 31, 2012. During the second quarter of 2013, management made a
provision for loan losses of $1.0 million partially offsetting $2.9 million in
net charge offs, a portion of which relates to the remediation of legacy
substandard loans.

Deposit balances increased to $1.1 billion at June 30, 2013, a year-to-date
increase of $28.0 million as the Bank worked with existing customer
relationships to expand relationships while also earning the business of new
customers choosing Bank of the Cascades. 

Net interest income was $11.5 million for the second quarter of 2013, down
$1.0 million compared to the second quarter of 2012 and down $2.5 million year
to date June 30, 2013 as compared to the year ago period. These declines were
mainly due to reductions in yields on earnings assets as a result of the
historically low interest rate market environment. Interest expense for the
second quarter of 2013 decreased $0.4 million compared to the second quarter
of 2012 and $0.9 million for the six months ended June 30, 2013 compared to
the year ago period. This decrease in interest expense was due to the
decreased rates on deposits in the low market rate environment. During the
second quarter of 2013, the Company prepaid $60.0 million of FHLB advances
bearing a weighted average rate of 3.17% which is intended to reduce future
interest expense by approximately $0.5 million per quarter.

Non-interest income in the second quarter of 2013 was comparable to the second
quarter of 2012, while non-interest expense in the second quarter of 2013 was
$5.1 million higher than the second quarter of 2012 primarily due to the $3.8
million prepayment penalty of FHLB advances and the $1.3 million recorded for
one-time human resource related items including incentive and severance
obligations and $0.4 million associated with branch consolidation costs.

As the Bank moves into the second half of the year, it is investing in
enhancing the convenience to customers with new online banking and bill pay
services. The new platforms pave the way for mobile banking and mobile deposit
services later in the year. According to Zink, "We are committed to being an
attractive alternative to big bank competitors and offering customer access
and conveniences that deliver the advantages of local banking anytime and
anywhere." Additionally, the Bank continues to expand its offering of mortgage
services and its team of experienced mortgage lenders to help customers
realize home ownership opportunities.

On July 9, 2013 Bank of the Cascades announced its intention to purchase the
Klamath Falls branch of AmericanWest Bank and the customer relationships of
the AmericanWest Bank (known locally as Premier West) branches in Bend and
Redmond, Oregon. According to Zink, "We look forward to welcoming new
customers to our bank and expanding our franchise to serve customers in the
Klamath Basin. We are especially pleased that we are able to provide
continuing career opportunities for the employees of the branches we are
purchasing, and provide them with the benefits of continued employment."

About Cascade Bancorp and Bank of the Cascades

Cascade Bancorp (NASDAQ: CACB), headquartered in Bend, Oregon, and its wholly
owned subsidiary, Bank of the Cascades, operate in Oregon and Idaho markets.
Founded in 1977, Bank of the Cascades offers full-service community banking
through 30 branches in Central, Southern and Northwest Oregon, as well as in
the greater Boise/Treasure Valley, Idaho area. The Bank has a business
strategy that focuses on delivering the best in community banking for the
financial well-being of customers and shareholders. It executes its strategy
through the consistent delivery of full relationship banking focused on
attracting and retaining value-driven customers. For further information,
please visit our website at www.botc.com.

FORWARD LOOKING STATEMENTS

This release contains forward-looking statements about Cascade Bancorp's plans
and anticipated results of operations and financial condition. These
statements include, but are not limited to, our plans, objectives,
expectations, and intentions and are not statements of historical fact. When
used in this report, the word "expects," "believes," "anticipates," "could,"
"may," "will," "should," "plan," "predicts," "projections," "continue" and
other similar expressions constitute forward-looking statements, as do any
other statements that expressly or implicitly predict future events, results
or performance, and such statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Certain
risks and uncertainties and Cascade Bancorp's success in managing such risks
and uncertainties could cause actual results to differ materially from those
projected, including among others, the risk factors described in our annual
report on Form 10-K filed with the Securities and Exchange Commission (the
"SEC") for the year ended December 31, 2012, as well as the following factors:
local and national economic conditions could be less favorable than expected
or could have a more direct and pronounced effect on us than expected and
adversely affect our results of operations and financial condition; the local
housing/real estate market could continue to decline for a longer period than
we anticipate; the risks presented by a continued economic recession, which
could continue to adversely affect credit quality, collateral values,
including real estate collateral and OREO properties, investment values,
liquidity and loan originations, reserves for loan losses and charge offs of
loans and loan portfolio delinquency rates and may be exacerbated by our
concentration of operations in the States of Oregon and Idaho generally, and
Central, Southern and Northwest Oregon, as well as the greater Boise/Treasure
Valley, Idaho area, specifically; interest rate changes could significantly
reduce net interest income and negatively affect funding sources; competition
among financial institutions could increase significantly; competition or
changes in interest rates could negatively affect net interest margin, as
could other factors listed from time to time in Cascade Bancorp's SEC reports;
the reputation of the financial services industry could further deteriorate,
which could adversely affect our ability to access markets for funding and to
acquire and retain customers; and existing regulatory requirements, changes in
regulatory requirements and legislation (including without limitation, the
Dodd-Frank Wall Street Reform and Consumer Protection Act) and our inability
to meet those requirements, including capital requirements and increases in
our deposit insurance premium, could adversely affect the businesses in which
we are engaged, our results of operations and financial condition. These
forward-looking statements speak only as of the date of this release. Cascade
Bancorp undertakes no obligation to publish revised forward-looking statements
to reflect the occurrence of unanticipated events or circumstances after the
date hereof. Readers should carefully review all disclosures filed by Cascade
Bancorp from time to time with the SEC.

Information contained herein, other than information at December 31, 2012, and
for the twelve months then ended, is unaudited. All financial data should be
read in conjunction with the notes to the consolidated financial statements of
Cascade Bancorp and subsidiary as of and for the fiscal year ended December
31, 2012, as contained in the Company's Annual Report on Form 10-K for such
fiscal year.

SOURCE Cascade Bancorp

Website: http://www.botc.com
Contact: Terry E. Zink, President and Chief Executive Officer, Cascade Bancorp
(541) 617-3527; Gregory D. Newton, EVP and Chief Financial Officer, Cascade
Bancorp (541) 617-3526
 
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