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Manhattan Bancorp Reports Continued Growth in Core Deposits and Loans at March 31, 2010

^{Published on 2010-05-18 06:06:52 - Market Wire}
 

LOS ANGELES--([ BUSINESS WIRE ])--Manhattan Bancorp (aCompanya) (OTCBB:MNHN), the holding company of Bank of Manhattan, N. A. (aBanka), a national bank, and MBFS Holdings, Inc., which owns a majority interest in Banc of Manhattan Capital, LLC, announced today strong growth in loans and core deposits, along with an improvement in its net interest margin for the period ended March 31, 2010.

• Total loans grew 38% to $85 million.
• Deposits increased 95% to $101 million, with non-interest bearing deposits reaching $31 million, or 30% of total deposits.
• Credit quality remains strong with no past-due loans, no non-performing loans and no Other Real Estate Owned.
• The Allowance for Loan and Lease Losses represented 1.74% of total outstanding loans as of March 31, 2010 compared with 1.85% of total outstanding loans as of March 31, 2009.
• The quarterly net interest margin for the first quarter of 2010 expanded to 3.99% compared to 3.60% for the first quarter of 2009.
• Capital ratios exceed the levels required to be considered awell-capitalizeda under generally applicable regulatory guidelines (the highest level determined by the regulatory agencies), with a Total Risk-Based Capital Ratio of 30%, Tier 1 Risk-Based Capital Ratio of 28% and Tier 1 Leverage Ratio of 20%.
• Banc of Manhattan Capital achieved profitability in the first quarter.

aThe Company is off to a good start in 2010. The Bank grew its loans base during the first quarter by 7% to $85 million. During that same period, core deposits grew 13%. The Bank continues to benefit from its strong capital base and healthy balance sheet, focusing on improving its core competency, investing in necessary infrastructure and exploring varied ways to meet customer needs and drive operational efficiencies,a said Deepak Kumar, the Company President and Chief Executive Officer.

At March 31, 2010, the Company had $134 million in assets and $27 million in shareholdersa™ equity, while reporting $1.3 million in losses for the quarter. The Bank continues to take a conservative approach by growing the loan loss reserve in the continued uncertain times. During this period, the Company increased its loan loss reserves to 1.74% by adding $370,000 to the provision for loan losses. It also incurred a one-time charge attributable to the transition of the Companya™s new CEO. Despite that, the Company achieved cash flow positive status for the month of March, 2010. The Company achieved positive cash flow for the month of March, 2010 which is calculated by reducing the consolidated net loss by non-cash expenditures, primarily the loan loss provision, depreciation and amortization, and stock-based compensation. To better reflect the nature of its core business, management has changed the policy of using FHLB advances at the end of the quarter to increase assets. The impact of this change reduced assets by approximately $8 millionas of March 31, 2010.

Bank of Manhattan, which opened for business on August 15, 2007, is a full service bank headquartered in the South Bay area of Los Angeles, California. Bank of Manhattana™s primary focus is relationship banking to entrepreneurs, family-owned and closely-held middle market businesses, real estate investors and professional service firms. At October 1, 2009, Manhattan Bancorp, through its wholly owned subsidiary, MBFS Holdings, Inc., acquired a 70% interest in Banc of Manhattan Capital, LLC, a full service mortgage-centric broker/dealer. Additional information is available at [ www.BankManhattan.com ].

FORWARD LOOKING STATEMENTS

Certain matters discussed in this release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements relate to the Companya™s current expectations regarding deposit and loan growth, operating results and the strength of the local economy. These forward looking statements are subject to certain risks and uncertainties that could cause the actual results, performance or achievements to differ materially from those expressed, suggested or implied by the forward looking statements. These risks and uncertainties include, but are not limited to: (1) the impact of changes in interest rates, a decline in economic conditions and increased competition among financial service providers on Bank of Manhattana™s operating results, ability to attract deposit and loan customers and the quality of Bank of Manhattana™s earning assets; (2) government regulation; and (3) the other risks set forth in the Companya™s December 31, 2009 10-K, ITEM 1A. Risk Factors filed with the Securities and Exchange Commission. The Company does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.