FORT LAUDERDALE, FL--(Marketwire - Jan 31, 2012) - Stonegate Bank (OTCBB: [ SGBK ])

Fourth Quarter 2011 Highlights:

• Total assets grew to $855 million from $638 million year over year
• 24 straight quarters of profitability
• 4.06% December net interest margin
• Net income of $2,800,000 for the fourth quarter of 2011, up 203% quarter over quarter
• Net income of $11.5 million for fiscal year 2011, up 228% year over year
• Tier 1 risk based capital ratio of 17.4% at December 31, 2011
• Non-interest bearing deposits grew 62% in 2011
• Total organic loan growth was 9.0% in 2011

Stonegate Bank (OTCBB: [ SGBK ]) reported net income of $2,800,000 or 34 cents per share for the fourth quarter of 2011, as compared to net income of $925,000 or 12 cents per share in the fourth quarter of 2010, a 203% increase. The Bank earned $11,544,000 or $1.40 per share in fiscal year 2011 as compared to $3,520,000 or 45.6 cents a share in fiscal year 2010, a 228% increase.

Income and Expenses:
Total interest income increased from $7.8 million in the fourth quarter of 2010 to $10.5 million in the fourth quarter of 2011. This $2.7 million increase is largely due to an increase of $179 million in total loans period to period. Total interest expense remained flat at $1.94 million in the fourth quarter of 2011 compared to $1.90 million in the fourth quarter of 2010. This occurred even though total deposits increased $201 million period to period. Further, the Bank's cost of funds decreased 33 basis points period to period with 25% of new deposit generation non-interest bearing. This resulted in net interest income improving from $5.9 million in the fourth quarter of 2010 to $8.6 million in the fourth quarter of 2011. During 2011, the Bank recognized bargain purchase gains of $18.8 million on the acquisitions of Southwest Capital Bank, an open bank transaction, and First Commercial Bank of Tampa Bay, an FDIC assisted transaction. This gain largely represents the difference in the purchase or bid price and the fair market value of the assets acquired. Total non-interest income, excluding the bargain purchase gain, increased to $835,000 in the fourth quarter of 2011 from $300,000 in the fourth quarter of 2010. Most of this increase came from fees associated with interest rate swaps entered into with our customers, mortgage fee income and increased service charge income. Non-interest expense increased to $6.4 million for the fourth quarter of 2011 from $4.1 million for the fourth quarter of 2010. The higher than normal expense is directly related to the Tampa Bay acquisition.

Margin and Cost of Funds:
Total cost of funds declined from a 1.20% September 2011 month to date average to 1.11% December 2011 month to date average. Stonegate Bank's net interest margin increased from a September 2011 month to date average of 3.91 % to December 2011 month to date average of 4.06%.

Balance Sheet and Capital:
Total assets grew from $638 million on December 31, 2010 to $855 million on December 31, 2011, a $217 million increase. Total loans increased $179 million from $421 million on December 31, 2010 to $600 million on December 31, 2011. Total deposits increased $201 million from $472 million on December 31, 2010 to $673 million on December 31, 2011. Slightly more than 15.0% of total deposits are non-interest bearing. Total capital grew from $95.7 million on December 31, 2010 to $118 million on December 31, 2011. This resulted in an undiluted book value of $14.32 per share on December 31, 2011.

Asset Quality:

Legacy

First Commercial Bank of Tampa Bay

Total Stonegate Bank

The loan quality detail is presented by showing the legacy Stonegate portfolio as well as the Bank's second quarter FDIC acquisition of First Commercial Bank of Tampa Bay. This is presented in order to provide additional clarity on the legacy portfolio trends as well as the Bank's progress in reducing non-performing loans and REO on the recent acquisition. The Bank's legacy non-performing assets increased slightly from $5.6 million on September 30, 2011 to $5.8 million on December 31, 2011. Overall, legacy non-performing assets represent 1.06% of total legacy loans. Total non-performing loans decreased from $11.6 million at September 30, 2011 to $10.3 million at December 31, 2011. Approximately half of the $10.3 million in non-performing loans are in the acquired First Commercial Bank of Tampa Bay portfolio. It should be noted that the First Commercial Bank of Tampa Bay portfolio continues to improve as reflected by the decline in non-performing loans from $6.8 million on June 30, 2011 to $4.5 million at December 31, 2011. Total Bank wide non-performing loans represent 1.21% of assets and 1.72% of total loans on December 31, 2011.

Management believes all non-performing assets and REO are written down to fair market value. Real estate owned decreased from $6.6 million on September 30, 2011 to $5.9 million on December 31, 2011.

The Bank's loan loss reserve was $14.4 million on December 31, 2011. This reserve represents 139% of all non-performing loans and 2.4% of total loans. Total loans past due more than 30 days remained relatively the same at 685,000 on September 30, 2011 and $655,000 on December 31, 2011.

"Clearly 2011 was the best year for Stonegate since our inception in 2005," said Dave Seleski, President and Chief Executive Officer. "Not only did the Bank have record earnings but some very compelling growth numbers. The Bank's assets increased $217 million. We also increased our non-interest bearing deposits 62%. Consequently, our overall non-interest bearing deposits increased to 15% of total deposits. Finally, organic loan growth was robust at 9.0%. The Bank also made significant strides in improving our asset quality in Tampa. We are going to continue to focus on organic growth in 2012 while being opportunistic in terms of acquisitions."

The Bank cautions that certain statements contained in this press release are "forward-looking statements" as defined under the Private Securities Litigation Reform Act of 1995, which statements are made pursuant to the "safe harbor" provisions of such Act. These forward-looking statements describe future plans or strategies and may include the Bank's expectations of future financial results. The words "believe," "expect," "anticipate," "estimate," "project," and similar expressions identify forward-looking statements. The Bank's ability to predict results or the effect of future plans or strategies or qualitative or quantitative changes is inherently uncertain. Actual results may differ materially from stated expectations. Specific factors include, but are not limited to, changes in general market interest rates, changes in general economic conditions and those specific to the Bank's market area, legislative/regulatory changes, monetary and fiscal policies of the U.S. Treasury and the Federal Reserve, changes in the quality or composition of the Bank's loan portfolios, demand for loan products, changes in deposit flows, real estate values, and competition and other economic, competitive, governmental, regulatory and technological factors affecting the Bank's operations, pricing, products and services. The Bank makes periodic filings to the Federal Deposit Insurance Corporation which contain various Bank financial information, copies of which are available from the Bank without charge. The Bank disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any forward-looking statements contained in this release to reflect future events or developments.