Community Bank Reports Record Performance in Earnings to $25.6 Million

Community Bank Reports Record Performance in Earnings to $25.6 Million

PASADENA, Calif.--(BUSINESS WIRE)-- Community Bank, an independent business bank with 17 business centers in Los Angeles, San Bernardino, Riverside, Ventura and Orange counties, today reported a 2.4% increase in net income to $6.9 million for the fourth quarter of 2012 compared to $6.7 million for the similar quarter in 2011. For the year ended December 31, 2012, the Bank reported record net income of $25.6 million compared to $25.2 million in 2011.

Net interest income for the fourth quarter of 2012 increased 2.1% over the prior year, totaling $23.9 million in 2012 versus $23.5 million in the prior year. For the year ended December 31, 2012, net interest income increased 0.9% over 2011, totaling $93.8 million in 2012 versus $93.0 million 2011. The improvement during 2012 was due to lower funding costs combined with earning asset growth which resulted in net interest margins of 3.35% and 3.51% for the fourth quarter and year ended December 31, 2012 respectively, compared to 3.70% and 3.75% for the fourth quarter and year ended December 31, 2011.

The Bank's reserve for loan losses as of December 31, 2012 was $34.9 million or 1.79% of total loans compared to $37.5 million or 2.12% of total loans as of December 31, 2011. The provision for loan losses totaled $0.0 million and $0.3 million for the fourth quarter and year ended December 31, 2012, respectively, compared to $1.2 million and $3.1 million for the fourth quarter and year ended December 31, 2011. The reduction in reserve levels is reflective of improving conditions in credit quality which is further evidenced by the 34.5% decrease in non-performing loans year over year.

Total loans as of December 31, 2012 increased to $1.94 billion as compared to $1.77 billion as of the prior year end. Total deposits as of December 31, 2012 increased to $2.21 billion as compared to $1.94 billion as of December 31, 2011. Community Bank's capital ratios continue to exceed regulatory requirements with Tier 1 Leverage, Tier 1 Risk-based Capital and Total Risk-based Capital Ratios of 8.17%, 10.21%, and 11.46%, respectively, as of December 31, 2012. Regulatory requirements for a "well-capitalized bank" are 5%, 6%, and 10%, respectively.

David Malone, Chairman of the Board. President and Chief Executive Officer, commented, "We have successfully increased earnings in a very challenging year. Despite a significant reduction in interest rate margin caused by continuing record low interest rates, the Bank recorded its highest earnings ever. Earnings were aided by very good loan growth and a reduction in the loan loss provision occasioned by improving credit quality. We are very pleased in achieving total assets of over $3 billion. We are very proud of this achievement and are grateful to reach a new milestone for the Bank.

"The Bank's capital ratios remain strong and coupled with continuing strong earnings allowed the Bank to pay record dividends of $35 million during the year. During 2012, the Bank added two new locations-West Los Angeles and Ventura County. We now have 17 business centers conveniently located throughout Southern California. During 2013 the Bank plans on introducing a new residential lending platform as well as enhancing and streamlining our SBA lending program.

"We thank all of our clients, shareholders, employees and vendors for their loyalty and support and wish all of you a year filled with prosperity and happiness."

Community Bank, with assets of $3.1 billion, was founded in 1945 and is headquartered in Pasadena. The Bank is a regional Southern California Bank with offices in Anaheim, Burbank, Commerce, Corona, Fontana, Glendale, Huntington Beach, Irvine, Ontario, Pasadena, Redlands, Santa Clarita, Santa Fe Springs, South Bay, Ventura, West Los Angeles, and Woodland Hills. For more information, visit the Community Bank Website at www.cbank.com.

This press release contains certain forward-looking statements, including certain plans, expectations, goals and projections, which are subject to numerous assumptions, risks and uncertainties. Actual results could differ materially from those contained in or implied by such statements for a variety of factors including: changes in economic conditions; movements in interest rates; competitive pressures on product pricing and services; success and timing of business strategies; the nature and extent of governmental actions and reforms; and rapidly changing technology and evolving banking industry standards.