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Community 1st Bank Reports Results for the Quarter and Year ended December 31, 2008

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^{Published in Business and Finance on Tuesday, February 3rd 2009 at 15:14 GMT, Last Modified on 2009-02-03 15:16:23 by Market Wire}  

ROSEVILLE, Calif.--([ BUSINESS WIRE ])--Community 1st Bank (OTCBB:CFBN), with $127.9 million in assets, today reported results for the quarter and year ended December 31, 2008.

Total assets at December 31, 2008 were $127.9 million, an increase of $58.0 million, or 83.0%, from December 31, 2007 and an increase of $31.2 million, or 32.3% from September 30, 2008. Community 1st Bank (the "Bank") was successful in growing its total deposits from $54.0 million at December 31, 2007 to $103.4 million at December 31, 2008, an increase of $49.4 million, or 91.6%. When compared to September 30, 2008, total deposits increased $23.3 million, or 29.1%. Total loans increased $18.4 million, or 28.6%, to total $82.8 million at December 31, 2008 from $64.4 million at December 31, 2007. Total loans increased $3.6 million, or 4.5% from September 30, 2008.

The Bank reported a net loss for the fourth quarter ended December 31, 2008 of $506,000, of which $406,000 represented provision for loan losses, compared to a net loss of $250,000, of which $152,000 represented provision for loan losses for the same period in 2007. This represents an increase in net loss of $256,000, or 102.4%, while provision for loan losses increased by $254,000, or 167.1% compared to the fourth quarter of 2007. Interest income increased by $406,000, or 31.9%, to $1.7 million for the fourth quarter ended December 31, 2008 compared to $1.3 million for the same period in 2007. Interest expense increased by $22,000, or 4.3%, to total $537,000 for the quarter ended December 31, 2008 compared to $515,000 for the same period in 2007. Net interest income increased by $384,000, or 50.6%, for the fourth quarter of 2008 compared to the same period in 2007. The increase in interest income and net interest income is the result of the Bank's success in growing its earning assets, which primarily consist of loans, investment securities, and Federal funds sold, while limiting the increase in interest expense.

The Bank reported a net loss for the year ended December 31, 2008 of $1,121,000, of which $874,000 represented provision for loan losses, compared to a net loss of $948,000, of which $415,000 represented provision for loan losses for the same period in 2007. This represents an increase in net loss of $173,000, or 18.3%, while provision for loan losses increased by $459,000, or 110.6%. Noninterest expense was $4.2 million for the year ended December 31, 2008 compared to $3.3 million for the same period in 2007, which is an increase of $842 thousand, or 25.2%. The increase in noninterest expense is due to the Bank's creation of the infrastructure necessary for balance sheet growth and expenses associated with the opening of our new branch in downtown Auburn, on the property purchase announced on September 5, 2008. This is the Bank's 3^rd full-service branch.

The allowance for loan losses at December 31, 2008 was $1.4 million, or 1.66% of total loans, compared to $865,000, or 1.34% of total loans at December 31, 2007. The increase in provision for loan losses during the quarter and year ended December 31, 2008, compared to the same periods in 2007, reflects our conservative view of the current economic climate, resulting in increased reserve, and charge-offs during the year of $361,000. Nonperforming assets consisted of other real estate owned and totaled $566,000 at December 31, 2008, which is 0.44% of total assets and no nonperforming assets at December 31, 2007.

The Bank continues to maintain a strong capital position with a Tier 1 Leverage ratio of 11.9%, Tier 1 Risk-based Capital ratio of 15.4% and Total Risk-based Capital ratio of 16.7%. The Bank's capital is well in excess of that required to be considered "well-capitalized" by regulatory standards.

Mark A. Lund, President and Chief Executive Officer, commented, "We enjoyed tremendous growth in deposits in the fourth quarter, as a result of our relationship banking supported by a full range of product offerings and online access. The economic environment remains challenging and we have not been immune from loan losses. We have significantly increased our reserve against the possibility of further impacts. Although we had one REO property at year-end, we believe our loan portfolio remains sound. We believe the new downtown Auburn branch will provide continued growth in 2009. As a well capitalized and liquid bank, we are well positioned for 2009, and for a return of more normal economic conditions."

Community 1^st Bank is headquartered in Roseville, California, with branches in Roseville, downtown Auburn and north Auburn, California. Community 1^st Bank offers a wide range of business and consumer deposit products including remote deposit capture, health savings accounts, online banking, and cash management services. The Bank also offers a full complement of loan products, including commercial, consumer, and real estate loans. For more information about the Bank, visit the Bank's website at [ www.community1bank.com ].

Forward-Looking Statements

Statements concerning future performance, developments or events, expectations for growth and income forecasts, and any other guidance on future periods, constitute forward-looking statements that are subject to a number of risks and uncertainties.Actual results may differ materially from stated expectations.Specific factors include, but are not limited to, loan production, competitive pressure in the banking industry, balance sheet management, net interest margin variations, the ability to control costs and expenses, changes in the interest rate environment and financial policies of the United States government and general economic conditions.The Bank disclaims any obligation to update any such factors.