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Citizens Bancorp Receives $10.4 Million Investment from the U.S. Treasury's Capital Purchase Program

^{Published on 2008-12-23 12:36:47, Last Modified on 2008-12-23 12:37:29 - Market Wire}
 

NEVADA CITY, Calif.--([ BUSINESS WIRE ])--Today, Citizens Bancorp (the "Company") (OTCBB:CZNB), the holding company of Citizens Bank of Northern California (the "Bank"), announced that it has received $10.4 million from the U.S. Treasury Department as a part of the Treasury's Capital Purchase Program. This voluntary program is available to strong and healthy financial institutions and will allow the Bank to increase credit availability to qualified businesses and consumers in the communities it serves.

"Citizens Bancorp is in a strong financial position and is considered "well-capitalized" by FDIC regulatory guidelines. The Company reported a total risk-based capital ratio of 11.96% as of September 30, 2008. We believe it is prudent in these economic times to bolster our already solid capital position," said Judy Hess, President & CEO. "Being selected to participate in this program is an important indication that the Treasury Department recognizes our stability," She continued. "Additional capital will enhance our ability to grow and expand on our already successful strategy of making quality, relationship-driven loans within our communities. This ultimately supports local economic activity," Hess concluded.

This $10.4 million funding marks the Company's successful completion of its sale to the Treasury of 10, 400 shares of preferred stock and a related warrant to purchase 520 shares of a second series of preferred stock. A summary of the Capital Purchase Program, including the terms of the preferred stock and warrant, can be found on the Treasury's web site at [ www.ustreas.gov/initiatives/eesa ] for "privately held institutions" or those institutions such as the Company, whose securities are not listed on a national securities exchange. The securities issued to the Treasury will be accounted for as components of regulatory Tier 1 capital. With the addition of this capital, the Bank's risk-based capital will exceed 14.00%.

Founded in February 1995, Citizens Bank, headquartered in Nevada City, became a wholly owned subsidiary of the Company in 2003. In addition to the new Auburn branch in Placer County, the Bank has six other branches in communities throughout Nevada County, including Nevada City, Grass Valley, Penn Valley, Lake of the Pines, and Truckee. The opening of the Auburn branch represents the Bank's first physical entry into neighboring Placer County. The Bank offers community banking services, including a wide variety of deposit products, commercial, residential and consumer loans, and other traditional banking products and services, designed to meet the needs of small and middle market businesses and individuals.