Solera National Bancorp Reports Fourth Quarter, Full Year 2013 Financial Results Reflecting Restructuring and Strategic Refocus,

Solera National Bancorp Reports Fourth Quarter, Full Year 2013 Financial
Results Reflecting Restructuring and Strategic Refocus, Organic Loan Growth,
Asset Quality

LAKEWOOD, Colo., Jan. 31, 2014 (GLOBE NEWSWIRE) -- Solera National Bancorp,
Inc. (OTCQB:SLRK), the holding company for Solera National Bank, today
reported financial results for the three months and 12 months ended December
31, 2013.

For the quarter ended December 31, 2013, the Company reported a net loss of
$638,000, or $0.25 per share, compared to net income of $113,000 or $0.04 per
share for the three months ended December 31, 2012. For the year ended
December 31, 2013, Solera reported a net loss of $655,000 or $0.25 per share,
compared to net income of $281,000 or $0.11 per share for the year ended
December 31, 2012.

The Company's net loss in both periods reflect a restructuring charge taken in
the fourth quarter 2013 to terminate a lease on a facility in Cherry Creek, CO
and costs related to suspending plans to expand the Company's Boulder, CO loan
production office into a full-service banking facility. Fourth quarter and
2013 year-over-year comparisons reflected higher employee compensation and
benefits related to expanding the residential mortgage lending business.
Additionally, the Company incurred severance costs associated with the
separation of executives during the fourth quarter 2013, while reducing idle
overhead. The year's results also included severance costs related to the
retirement of the Company's former CEO in the third quarter 2013.

John P. Carmichael, President and CEO, commented: "The Company's results in
fourth quarter and full year 2013 reflected decisive action taken to
significantly scale back previous plans to expand Solera's residential
mortgage lending business. Higher interest rates and the rapid decline in
mortgage refinancing activity in the second half of 2013 made it clear that
mortgage activity, particularly refinancings, will return to more historical
levels, which has caused Solera to respond accordingly."

As a result, he explained, the Company will leverage its existing
infrastructure and capacity, continuing to support residential mortgage
lending, and heighten the Bank's traditional focus on commercial banking
through its loan production offices located in key market centers in Colorado.

"There is work ahead of us to reposition the Bank to operate productively,
efficiently and to capitalize on our core strengths," Carmichael said, "and we
believe Solera has the firm footing needed to immediately begin pursuing a
prudently revised set of objectives. Since joining Solera just prior to the
start of the fourth quarter 2013, I have had the opportunity to see that
Solera is uniquely positioned in an attractive demographic market, and I
believe there is a tremendous opportunity to build on our existing
infrastructure.

"We have an established presence, people and facilities in key Colorado market
centers, including the Metro Denver area, Boulder, Durango and Colorado
Springs. We have the capabilities to serve clients, win business and build
market share.

"I am encouraged that fourth quarter and full year 2013 results reflect a
number of positive ongoing trends. In particular, we are demonstrating growing
interest income. Our loan portfolio, including both commercial and residential
loans, increased by $20 million in 2013 compared to the previous year, with an
approximate 50/50 split between commercial and residential mortgage loan
growth. Increased deposits reflected organic growth and $6 million of acquired
deposits, providing inexpensive liquidity to fund accelerating lending
activity.

"The Bank ended the year exceeding accepted regulatory standards for a well
capitalized institution. Our asset quality was nothing short of outstanding,
including no non-performing loans, with no loan loss provision during the
year. While we had to make some difficult decisions with respect to the entire
operation to help ensure future efficiency and productivity, Solera's
fundamentals are sound and form a solid foundation to best position the entire
operation for a prosperous future."

Review of Operations

For the quarter ended December 31, 2013, the Company reported a net loss of
$638,000, or $0.25 per share, compared to net income of $113,000 or $0.04 per
share for the quarter ended December 31, 2012. Net interest income in fourth
quarter 2013 was $1.22 million compared with $1.00 million in fourth quarter
2012. Both periods contained no provision for loan and lease losses.

Interest and fees on loans increased to $970,000 in fourth quarter 2013
compared with $835,000 in fourth quarter 2012, primarily reflecting growth in
originated and retained residential mortgages, and growth in our commercial
loan portfolio. Total interest income was $1.54 million for the quarter ended
December 31, 2013 compared with $1.31 million for the quarter ended December
31, 2012.

"Even during the higher interest rate environment during the second half of
2013, purchase mortgage originations remained relatively consistent with the
prior two quarters," Carmichael said. "We continue to believe that new home
mortgages, and particularly non-conforming mortgages, will be a viable
contributor to our business going forward."

Solera's net interest margin was 3.00% in fourth quarter 2013, compared with
2.69% in fourth quarter 2012. On a consecutive quarter basis, the Bank grew
quarterly margins from 2.82% in second quarter 2013 and 2.92% in third quarter
2013.

"The continuing shift in mix from lower yielding investment securities to
commercial and residential mortgage loans contributed to the net interest
margin expansion in the fourth quarter 2013," noted Robert J. Fenton, COO and
CFO. "Additionally, the slowdown in refinance activity resulted in lower
premium amortization and therefore higher yields on our mortgage-backed
securities."

Total noninterest income in fourth quarter 2013 was $1.36 million compared
with $351,000 in fourth quarter 2012, primarily reflecting a gain on loans
sold of $1.17 million compared with $124,000 in fourth quarter 2012. On a
consecutive quarter basis, the slowing of mortgage refinancing activity was
reflected in a decline in gains on loans sold from $1.56 million in third
quarter 2013.

Total noninterest expense in fourth quarter 2013 totaled $3.23 million
compared with $1.24 million in fourth quarter 2012, reflecting expenses for
the residential mortgage lending business launched in December of 2012,
restructuring charges, and executive severance charges.

For the year ended December 31, 2013, the Company reported a net loss of
$655,000 or $0.25 per share, compared with net income of $281,000 or $0.11 per
share for the year ended December 31, 2012. Net interest income in 2013 was
$4.60 million compared with $4.06 million in 2012. Neither year reflected any
provision for loan and lease losses.

Interest and fees on loans was $3.58 million in 2013 compared with $3.27
million in 2012. Total interest income was $5.82 million in 2013 compared with
$5.34 million in 2012, with a $305,000 increase in interest and fees on loans
partially offset a $251,000 decrease in interest generated by investment
securities. Total interest expense was $1.22 million in 2013 compared with
$1.28 million in 2012. Net interest margin was 2.88% in 2013 compared with
2.79% in 2012.

Total noninterest income for the year ended December 31, 2013 was $7.40
million compared with $1.05 million for the year ended December 31, 2012,
reflecting a gain on loans sold of $6.75 million compared with $149,000 the
previous year. Despite the slowdown in the Company's residential mortgage
business, Carmichael said the Bank expects to continue to generate significant
gains from residential mortgages that it originates and sells.

Total noninterest expense in 2013 totaled $12.66 million compared with $4.83
million in 2012, primarily reflecting expenses for the residential mortgage
lending business launched in December 2012, restructuring charges in fourth
quarter 2013 of approximately $360,000, expenses incurred in the third quarter
in conjunction with the retirement of Solera's former President and CEO,
additional executive severance costs in the fourth quarter, and expenses
associated with one of the Bank's two OREO properties.

Balance Sheet Review, Credit Quality and Shareholder Value

The Company demonstrated year-over-year loan growth as net loans, after
allowance for loan and lease losses, increased to $78.17 million at December
31, 2013 compared with $58.74 million at December 31, 2012. Loans held for
sale were $7.95 million at December 31, 2013 compared with $180,000 at
December 31, 2012.

"We believe the year-over-year growth in loans held for investment, and the
quality of our loan portfolio, are very positive signs that Solera can build a
balanced high-quality commercial and residential loan portfolio," Carmichael
said. "The key to moving the Bank forward is to make a strategic transition
that places the emphasis on these core lending activities, while building the
business lines in a manner that is sustainable in many interest rate
environments. We plan to add experienced commercial bankers, and leverage our
status as a preferred Small Business Administration lender to develop SBA 7(a)
and 504 lending opportunities."

Total deposits at December 31, 2013 increased to $132.84 million compared with
$124.73 million at December 31, 2012. Noninterest-bearing demand deposits grew
88% year-over-year, reflecting both organic expansion and acquired deposits.

The Bank's loan quality measurements as of December 31, 2013, including a
ratio of non-performing loans to gross loans of 0% and an allowance for loan
losses to gross loans of 1.41%, indicate the Bank was able to prudently grow
lending and maintain strong credit and risk management. The Bank had no
non-performing loans as of December 31, 2013.

Solera's total assets were $169.68 million at December 31, 2013 compared with
$153.90 million at December 31, 2012, primarily reflecting growth in the
Bank's loan portfolio, loans held for sale, and bank-owned life insurance,
partially offset by lower investment securities related to changes in the
Bank's mix of investments as previously noted.

The Bank's capital ratios exceed regulatory requirements for a
well-capitalized financial institution, with a tier 1 leverage ratio of 9.6%,
a total risk-based capital ratio of 15.4% and tier 1 risk-based capital ratio
of 14.4%.

Tangible book value per share, excluding accumulated other comprehensive
income, was $6.96 at December 31, 2013, compared with $7.39 at December 31,
2012. Total stockholders' equity was $16.98 million at December 31, 2013
compared with $19.94 million at December 31, 2012, primarily reflecting a
$2.56 million reduction in accumulated other comprehensive income as a result
of the fair value of the Bank's available-for-sale investment portfolio.

Carmichael concluded: "Even after refocusing our operation and branching
efforts, we have the capacity to support and build residential mortgage and
commercial banking efforts. We have an experienced team in place. Going
forward, Solera intends to focus on its strongest opportunities in Colorado
market centers we serve, including the Metro Denver area, Boulder, Durango and
Colorado Springs.

"Solera offers a full range of commercial loan and deposit capabilities,
complemented by treasury management services. We have a well-established
tradition of serving the needs of small- and mid-sized businesses, and a
specialty in meeting the banking needs of emerging markets. As we reposition
the Bank's operations, we plan to build on our successes and seek
opportunities to grow and operate efficiently."

About Solera National Bancorp, Inc.

Solera National Bancorp, Inc. was incorporated in 2006 to organize and serve
as the holding company for Solera National Bank, which opened for business in
September 2007. Solera National Bank is a community bank serving emerging
businesses in Lakewood, Colorado with five additional loan production offices
throughout the state. At the core of Solera National Bank is welcoming,
inclusive and respectful customer service, a focus on supporting a growing and
diverse Colorado economy, and a passion to serve the Hispanic community
through service, education and volunteerism. For more information, please
visit http://www.SoleraBank.com.

Cautions Concerning Forward-Looking Statements

This press release contains statements that may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. The statements contained in this release, which are not historical
facts and that relate to future plans or projected results of Solera National
Bancorp, Inc. ("Company") and its wholly-owned subsidiary, Solera National
Bank ("Bank"), are forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. These forward-looking statements are subject to risks and
uncertainties that could cause actual results to differ materially from those
projected, anticipated or implied. These risks and uncertainties can include
the risks associated with the ability to grow the Bank and the services it
provides, the ability to successfully integrate new business lines and expand
into new markets, competition in the marketplace, general economic conditions
and many other risks described in the Company's Securities and Exchange
Commission filings. The most significant of these uncertainties are described
in our Annual Report on Form 10-K and Quarterly reports on Form 10-Q all of
which any reader of this release is encouraged to study (including all
amendments to those reports) and exhibits to those reports, and include (but
are not limited to) the following: the Company has a limited operating history
upon which to base an estimate of its future financial performance; general
economic conditions may be less favorable than expected, causing an adverse
impact on our financial performance; and the Company is subject to extensive
regulatory oversight, which could restrain its growth and profitability. We
undertake no obligation to update or revise any forward-looking statement.
Readers of this release are cautioned not to put undue reliance on
forward-looking statements.

SOLERA NATIONAL BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
($000s)                                       12/31/2013 9/30/2013  12/31/2012
ASSETS                                                            
                                                                 
Cash and due from banks                       $742     $1,432   $1,038
Federal funds sold                            1,600     390       1,700
Interest-bearing deposits with banks          257       257       257
Investment securities, available-for-sale     69,839    77,648    84,710
FHLB and Federal Reserve Bank stocks, at cost 2,346     2,395     1,189
Gross loans                                   79,240    72,595    59,632
Net deferred (fees)/expenses                  46        47        175
Allowance for loan and lease losses           (1,116)   (1,101)   (1,063)
Net loans                                     78,170    71,541    58,744
Loans held for sale                           7,951     9,672     180
Premises and equipment, net                   888       937       998
Other real estate owned                       1,746     1,776     1,776
Accrued interest receivable                   705       679       707
Bank-owned life insurance                     4,316     4,277     2,067
Other assets                                  1,117     1,293     531
TOTAL ASSETS                                  $169,677 $172,297 $153,897
                                                                 
LIABILITIES AND STOCKHOLDERS' EQUITY                               
Noninterest-bearing demand deposits           $6,362   $4,742   $3,387
Interest-bearing demand deposits              10,559    9,562     8,218
Savings and money market deposits             51,185    52,429    55,358
Time deposits                                 64,738    60,639    57,769
Total deposits                                132,844   127,372   124,732
                                                                 
Accrued interest payable                      63        78        56
FHLB borrowings                               18,308    25,447    8,500
Accounts payable and other liabilities        1,487     1,143     668
TOTAL LIABILITIES                             152,702   154,040   133,956
                                                                 
Common stock                                  26        26        26
Additional paid-in capital                    26,558    26,493    26,206
Accumulated deficit                           (8,015)   (7,377)   (7,359)
Accumulated other comprehensive income        (1,492)   (885)     1,068
Treasury stock, at cost, 14,208 shares        (102)     —         —
TOTAL STOCKHOLDERS' EQUITY                    16,975    18,257    19,941
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $169,677 $172,297 $153,897


SOLERA NATIONAL BANCORP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
                        Three Months Ended              Twelve Months Ended
                                                               
($000s, except per share 12/31/2013 9/30/2013 12/31/2012 12/31/2013 12/31/2012
data)
Interest and dividend                                           
income
Interest and fees on     $970    $949   $835    $3,577  $3,272
loans
Interest on loans held   75       112     —         402      —
for sale
Investment securities    473      432     465      1,762    2,013
Dividends on bank stocks 16       17      11       67       40
Other                    3        3       3        9        10
Total interest income    1,537    1,513   1,314    5,817    5,335
Interest expense                                                
Deposits                 273      271     277      1,058    1,140
FHLB borrowings          41       40      33       160      131
Other                    —         —        1        —         5
Total interest expense   314      311     311      1,218    1,276
Net interest income      1,223    1,202   1,003    4,599    4,059
Provision for loan and   —         —        —         —         —
lease losses
Net interest income
after provision for loan 1,223    1,202   1,003    4,599    4,059
and lease losses
Noninterest income                                              
Customer service and     32       31      19       106      73
other fees
Other income             65       39      47       160      96
Gain on loans sold       1,174    1,564   124      6,750    149
Gain on sale of
available-for-sale       93       49      161      387      730
securities
Total noninterest income 1,364    1,683   351      7,403    1,048
Noninterest expense                                             
Employee compensation    1,917    2,429   727      8,426    2,516
and benefits
Occupancy                256      257     113      1,033    480
Professional fees        109      187     106      503      451
Other general and        943      650     295      2,695    1,379
administrative
Total noninterest        3,225    3,523   1,241    12,657   4,826
expense
Net (loss) income        $(638)   $(638)  $113    $(655)   $281
                                                               
Earnings (Loss) per      $(0.25)  $(0.25) $0.04   $(0.25)  $0.11
share
Tangible book value per  $6.96   $7.21  $7.39   $6.96   $7.39
share
Net interest margin      3.00 %     2.92 %    2.69 %     2.88 %     2.79 %
                                                               
Asset Quality:                                                  
Non-performing loans to  —%         —%        0.02 %               
gross loans
Non-performing assets to 1.03 %     1.03 %    1.16 %               
total assets
Allowance for loan       1.41 %     1.52 %    1.78 %               
losses to gross loans
Allowance for loan
losses to non-performing NM*        NM*       NM*                  
loans
Other real estate owned  $1,746  $1,776 $1,776            
* Not meaningful due to
the insignificant amount                    
of non-performing loans.
                                                               
Selected Financial Ratios: (Solera                               
National Bank Only)
Tier 1 leverage ratio    9.6 %      9.8 %     10.8 %               
Tier 1 risk-based        14.4 %     15.0 %    18.1 %               
capital ratio
Total risk-based capital 15.4 %     16.0 %    19.3 %               
ratio

CONTACT: SOLERA NATIONAL BANCORP, INC.
         JOHN P. CARMICHAEL, PRESIDENT & CEO
         (303) 937-6422
         ROBERT J. FENTON, EVP & CFO
         (303) 202-0933
 
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