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Community 1st Bank Receives Capital Through the U.S. Treasury Capital Purchase Program

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^{Published in Business and Finance on Wednesday, February 4th 2009 at 4:07 GMT, Last Modified on 2009-02-04 04:08:09 by Market Wire}  

ROSEVILLE, Calif.--([ BUSINESS WIRE ])--Community 1^st Bank (OTCBB: CFBN), announced today that it has received $2,550,000 as an approved participant in the U.S. Treasury Department's TARP Capital Purchase Program. The Bank issued 2,550 shares of Series A preferred stock and a related warrant for 128 shares of Series B preferred stock, which represents 5% of the Series A preferred stock amount or $127,500, to the U.S. Treasury.

The TARP Capital Purchase Program, created by the U.S. Treasury, is a voluntary program in which selected, healthy financial institutions were encouraged to participate. Such participation is intended to support the economic development of the community and thereby restore the health of the local and national economy.

Mark A. Lund, President and Chief Executive Officer of Community 1^st Bank, characterized the Bank's participation in the program by saying, "The U.S. Treasury Capital Purchase Program further strengthens our balance sheet, assuring sufficient capital to maintain our growth rate through this uncertain economic time. We expect to profitably leverage this capital infusion through lending and community based investments, fulfilling our mission as an outstanding corporate citizen."

Before receiving the TARP funds, Community 1^st Bank was well-capitalized as measured by all regulatory guidelines. On December 31, 2008, the Company's Tier 1 Leverage Capital Ratio was 11.9%, and its Total Risk-Based Capital Ratio was 16.7%. Based on the December 31, 2008 financial statements, the addition of new capital through the Treasury's Capital Purchase Program will increase the Bank's Tier 1 Leverage Capital Ratio to approximately 14.0% and Total Risk-Based Capital Ratio to approximately 19.4%.

The Series A preferred stock issued by the Bank will pay a 5% dividend for the first 5 years, after which the rate will increase to 9% if the Bank does not redeem the preferred shares. The Series B preferred stock issued by the Bank will pay a 9% dividend. These preferred shares do not carry voting rights, except in certain limited circumstances. The Bank issued the preferred shares and warrants only to the U.S. Treasury, not to any other third parties. Terms and conditions of the transaction and the preferred stock will conform to those provided by the U.S. Treasury. A summary of the Capital Purchase Program can be found at the Treasury's web site: [ www.ustreas.gov/initiatives/eesa ].

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.