SOUTH SAN FRANCISCO, CA--(Marketwire - Apr 25, 2012) - FNB Bancorp (OTCBB: [ FNBG ]), parent company of First National Bank of Northern California (the "Bank"), today announced net earnings available to common shareholders for the first quarter of 2012 of $1,102,000 or $0.31 per diluted share, compared to net earnings available to common shareholders of $589,000 or $0.17 per diluted share for the first quarter of 2011. Dividend payments on the preferred shares outstanding were made as required by the Treasury Department's Small Business Lending Program. Total assets as of March 31, 2012 were $746,649,000 compared to $696,590,000 as of March 31, 2011. Our net loans decreased by $16,443,000 or 3.5% year over year. However, our deposits increased by $42,249,000 or 6.9% during the same period. At March 31, 2012, the Company had considerable liquid assets on hand as evidenced by $205,353,000 in available for sale securities and $45,118,000 in cash and cash equivalents.

During March, 2012, FNB Bancorp entered into a Stock Purchase Agreement whereby FNB Bancorp agreed to acquire all the outstanding shares of Oceanic Bank Holding, Inc., the sole shareholder of Oceanic Bank, in San Francisco, CA. This purchase is subject to regulatory approval.

"We are looking forward to integrating Oceanic Bank into our existing operations. The Oceanic purchase allows us the opportunity to expand our customer base; primarily within our existing geographic footprint. The operations of Oceanic Bank are currently profitable and with over 30 years of experience, they are familiar with their customers and how to meet their financial needs. In times like these, where quality loan and deposit relationships are difficult to find, the Oceanic Bank acquisition is a welcome opportunity," stated Tom McGraw, Chief Executive Officer.

"During the first quarter of 2012, the Bank charged off over $2 million dollars in expected credit losses against our allowance for loan losses. These credit losses were factored into our previously projected loss calculations and no material change to our loss provision for the quarter was warranted. Over half of this charge-off amount was related to a single lending relationship. Management believes the quality of our loan portfolio continues to improve as we work with our borrowers who may be having temporary financial difficulties," continued Mr. McGraw.

"During the first quarter of 2012, the Bank sadly recognized a $370,000 gain on life insurance proceeds related to the death of the Bank's previous Chief Executive Officer and Chairman of the Board, Mr. Mike Wyman. Mike's contribution to the success of our Bank is still evident throughout our organization. He mentored many here at the Bank, including myself. He will surely be missed," stated Tom McGraw.

"Our balance sheet continues to grow, funded primarily through increased deposit balances invested in investment securities. Our loan pipeline has recently shown signs of improvement and we hope to be able to fund more loans and increase the size of our loan portfolio in the near future. We have recently hired an additional loan officer for our Sunnyvale loan production center in the belief that we have significant lending opportunities there. It is our intent to eventually apply to make this location a full service branch. We believe the key to the success of our Bank is the ability to grow through means that make sense. We believe that our growth is best achieved through thoughtful strategic acquisitions, such as the Oceanic Bank purchase, as well as organic growth and branch expansion, as evidenced by our commitment to our Chestnut Street branch and our Sunnyvale loan production office," continued Mr. McGraw.

Cautionary Statement: This release contains certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those stated herein. Management's assumptions and projections are based on their anticipation of future events and actual performance may differ materially from those projected. Risks and uncertainties which could impact future financial performance include, among others, (a) competitive pressures in the banking industry; (b) changes in the interest rate environment; (c) general economic conditions, either nationally or regionally or locally, including fluctuations in real estate values; (d) changes in the regulatory environment; (e) changes in business conditions or the securities markets and inflation; (f) possible shortages of gas and electricity at utility companies operating in the State of California, and (g) the effects of terrorism, including the events of September 11, 2001, and thereafter, and the conduct of war on terrorism by the United States and its allies. Therefore, the information set forth herein, together with other information contained in the periodic reports filed by FNB Bancorp with the Securities and Exchange Commission, should be carefully considered when evaluating its business prospects. FNB Bancorp undertakes no obligation to update any forward-looking statements contained in this release.