PBNK Pinnacle Bank (QB)

PBNK - Pinnacle Bank, headquartered in Gilroy, California, announced today unaudited net income for the three months ended March 31, 2014 of $160,000 compared to $109,000 in the same period of 2013.

As of March 31, 2014, total assets were $206.0 million, an 18% increase from the $175.2 million at March 31, 2013.

Loans were $148.8 million at March 31, 2014, an increase of $11.9 million (9%) from the March 31, 2013 balance of $136.9 million. The allowance for loan losses at March 31, 2014 was $3.4 million or 2.31% of loans compared to $2.7 million or 2.0% of loans at March 31, 2013. Nonperforming assets were reduced to $2.7 million (1.33% of assets) at March 31, 2014 from $3.2 million (1.85% of assets) a year earlier.

Non-interest bearing deposits at March 31, 2014, increased 44% to $66.7 million from $46.3 million at March 31, 2013. Total deposits at March 31, 2014, were $182.1 million compared to $157.3 million at March 31, 2013, a 16% increase.

“Our first quarter 2014 performance continues to build upon the achievements of 2013 and reflects additional growth in our loan and deposit portfolios in our local markets. The gradual and uneven improvement in local market conditions can be seen in recovering real estate values and other economic measures. We believe our markets continue to bear opportunities for organic growth with high quality loan demand and core deposits,” stated Susan K. Black, President and CEO. “The 44% year-over-year growth in non-interest bearing deposits highlights the solid local core business banking relationships we have added in the last year,” added Ms. Black. “Our commitment to Monterey County, as evidenced by our new director Paul Bruno and the new Salinas location which opened in the second quarter of 2013, has never been stronger. We are building a solid franchise and remain optimistic about future opportunities.”

The bank’s capital position remains above regulatory guidelines for well capitalized banks. At March 31, 2014, the Bank had a total risk based capital ratio of 11.32%. Book value per share at March 31, 2014 was $7.04. Net interest margin in the first quarter of 2014 was 4.77%.

For more information please go to www.pinnaclebankonline.com click on Investor Relations and March 2014 call report.

About Pinnacle Bank

Pinnacle Bank is a full-service business bank dedicated to providing quality depository and credit services in Santa Clara, San Benito and Monterey counties. The bank focuses on commercial banking services for small to medium-sized businesses, offering a variety of products and services that combine the best of personal touch with convenient technology-based delivery. Pinnacle Bank has locations in Morgan Hill, Gilroy and Salinas. For more information please go to www.pinnaclebankonline.com click on Investor Relations and March 2014 call report.

Forward-Looking Statements

This release may contain forward-looking statements, such as, among others, statements about plans, expectations and goals concerning growth and improvement. Forward-looking statements are subject to risks and uncertainties. Such risks and uncertainties may include, but are not necessarily limited to fluctuations in interest rates, inflation, government regulations and general economic conditions, including the real estate market in our primary service area and more generally in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. Pinnacle Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

        Summary Balance Sheet Year over year change (Unaudited, dollars in thousands) 3/31/2014   12/31/2013   3/31/2013   $   % Total assets $ 205,988 $ 189,728 $ 175,150 $ 30,838   18 % Gross loans $ 148,811 $ 147,199 $ 136,879 $ 11,932 9 % Allowance for loan losses $ (3,433 ) $ (3,460 ) $ (2,677 ) $ (756 ) 28 % Non-interest bearing deposits $ 66,746 $ 59,436 $ 46,258 $ 20,488 44 % Interest-bearing deposits $ 115,326 $ 106,687 $ 111,062 $ 4,264 4 % Total deposits $ 182,072 $ 166,123 $ 157,320 $ 24,752 16 % Shareholders' equity $ 23,174 $ 22,963 $ 16,743 $ 6,431 38 %           Summary Income Statement

(Unaudited, dollars in thousands

Quarter ended Quarter ended Change Quarter ended Change

except per share data)

3/31/2014   12/31/2013  

 

%

  3/31/2013  

 

%

Interest income $ 2,160 $ 1,897 14 % $ 1,833 18 % Interest expense   75     78 -4 %   93 -20 % Net interest income 2,085 1,818 15 % 1,740 20 % Provision for loan losses 0 0 0 % 94 -100 % Non-interest income 219 273 -20 % 172 28 % Non-interest expense 2,029 1,734 17 % 1,709 19 % Income tax expense   116     137 -15 %   0 nm Net income (loss) $ 160   $ 221 -28 % $ 109 46 %   Earnings (loss) per share $ 0.05 $ 0.07 -28 % $ 0.03 46 % Book value per share $ 7.04 $ 7.02 $ 5.09         Minimum required to be Capital Ratios 3/31/2014   12/31/2013   3/31/2013   well-capitalized Tier 1 leverage ratio 9.40 % 9.54 % 9.89 % 5.00 % Tier 1 risk-based capital ratio 10.06 % 10.21 % 10.32 % 6.00 % Total risk-based capital ratio 11.32 % 11.47 % 11.58 % 10.00 %       Nonperforming assets 3/31/2014   12/31/2013   3/31/2013 Nonperforming assets $ 2,738 $ 2,802 $ 3,233 Nonperforming assets to total assets 1.33 % 1.48 %

1.85

% Allowance for loan losses to nonperforming loans 247 % 238 % 195 %

Pinnacle BankSusan K. Black, 408-762-7140President & CEO