SOURCE: Beach Business Bank

January 24, 2007 17:00 ET

Beach Business Bank Reports Record Profit for 4th Quarter and Full Year

MANHATTAN BEACH, CA -- (MARKET WIRE) -- January 24, 2007 --Beach Business Bank (OTCBB: BBBC) (the "Bank") is pleased to report its results of operations for the fourth quarter and full year 2006. During the quarter, the Bank recorded after tax earnings of $574,000, a 150.7% increase over the Bank's reported profitability in the 4th quarter of 2005. The financial results demonstrated 15.4% growth in net loans over the previous quarter, and 114.7% growth in net loans over the same quarter of the prior year. Deposit growth was 26.3% over the previous quarter, and 74.6% over the same quarter of the prior year. Total new loan commitments in the quarter amounted to almost $39 million. The Bank reported a profit for the full year of $1,047,000, the Bank's first fully profitable year, compared to a loss in 2005 for the full year of ($451,000).

Robert Franko, president and chief executive of Beach Business Bank, commented, "We are extremely proud to be able to report these record earnings in only our second full year of operations. We have an outstanding team of bankers who have consistently demonstrated an ability to generate quality assets. We are also opening more core deposit accounts, as demonstrated by 97.9% growth in non-interest bearing demand deposit balances over the previous year, and 52.1% growth over the previous quarter."

Jim Gray, the co-chairman of the Bank's board of directors and the recent recipient of the Distinguished Banker of the Year Award from the California Bankers Association, commented, "Growth is clearly a major component of our strategy, but our major focus continues to be profitability. I am particularly pleased to see the growth in core deposits and the increase in community banking relationships."

For the fourth quarter, the Bank reported a Net Profit after Provision for Loan Losses of approximately $574,000. As of December 31, 2006, the Bank's Allowance for Loan Losses stands at 1.53% of total loans, net of loans available for sale. Net loan growth in the fourth quarter was $14.9 million and net deposits increased $20.6 million. As of December 31, 2006, the Bank had no non-performing assets and no loans 30 days or more past due. Other selected financial data is included in the table below.

The Bank ended the fourth quarter with Shareholders' Equity of $36.4 million, with 4,036,984 shares issued and outstanding at the end of the quarter.

Financial statements in the form of the Bank's Call Report, as filed with the FDIC, will be available on the Bank's web site at, and should be available for review or downloading from the FDIC web site at in approximately four weeks.

Since opening its doors on June 1, 2004, the Bank has grown from approximately $10.7 million in total assets to just over $136.6 million in total assets at the end of December, 2006.

Beach Business Bank is headquartered at 1230 Rosecrans Avenue, Lobby Level, in Manhattan Beach, and has a second full-service office at 180 E. Ocean Blvd. in Long Beach, CA. The Bank is first and foremost a community business bank serving Los Angeles, Long Beach, and the South Bay area residents and businesses. The Bank also has a division named The Doctors Bank, which serves physicians and dentists nationwide. In addition, Beach Business Bank provides loans to small businesses, focused around the SBA 7(a), 504, and Express lending programs. The Bank makes a special effort to serve minority-owned businesses. For more information on the Bank, please visit or call 866-862-3878 or 310-536-2260; in Long Beach, call 562-435-8600.

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995:

The financial information in this press release is based on our unaudited financial results. Certain statements in this press release, including statements regarding the anticipated development and expansion of the Bank's business, and the intent, belief, and current expectations of the Bank, its directors, or its officers, are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements are subject to risks and uncertainties and therefore the Bank's actual results may differ materially from those expressed or implied by such forward-looking statements. The risks and uncertainties that the Bank is subject to include, but are not limited to, risks related to the local and national economy, including fluctuations in interest rates and costs and changes in economic policy; the ability of the Bank to perform in accordance with its plans; competition; regulatory matters; and other risks detailed in its filings with the State of California Department of Financial Institutions and the Federal Deposit Insurance Corporation. The Bank cautions readers not to place undue reliance on any forward-looking statements. The Bank does not undertake, and specifically disclaims any obligation, to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

                    Beach Business Bank
                Selected Financial Data Table

                                     December 31, 2006   December 31, 2005
Balance Sheet Results (In thousands),
 except per share data:
     Total Assets                    $         136,695   $          83,843
     Total Net Loans                 $         111,891   $          52,213
     Allowance for Loan Losses       $          (1,565)  $            (816)
     Total Deposits                  $          98,917   $          56,656
     Non-performing Assets           $               -   $               -
     Total Shareholders' Equity      $          36,449   $          25,800
     Net Loans to Deposits                      113.12%              92.16%
     ALLL to Loans HTM                            1.53%               1.54%
     Equity to Assets                            26.66%              30.77%
     Ending Shares outstanding               4,036,984           3,035,450
     Ending Book Value per Share     $            9.03   $            8.50

                                                Three Months Ended
                                                   December 31,
                                             2006                2005
Quarterly Operating Results
 (In thousands):
     Net Interest Income             $           1,658   $             777
     Non-interest Income             $             470   $             799
     Non-interest Expense            $           1,493   $           1,184
     Income Before Provision & Taxes $             634   $             392
     Provision for Loan Losses       $              60   $             163
     Income Tax Expense              $               -   $               -
     Net Income                      $             574   $             229
     Quarterly Return on Average
      Assets*                                     1.87%               1.35%
     Quarterly Return on Average
      Equity*                                     6.39%               3.56%
     Quarterly Net Interest Margin*               5.38%               4.62%
     Quarterly Efficiency Ratio*                 70.19%              75.12%

                                              Year Ended December 31,
                                             2006                2005
YTD Operating Results
 (In thousands):
     Net Interest Income             $           5,409   $           2,154
     Non-interest Income             $           1,731   $           1,551
     Non-interest Expense            $           5,345   $           3,680
     Income Before Provision & Taxes $           1,796   $              26
     Provision for Loan Losses       $             749   $             476
     Income Tax Expense              $               1   $               1
     Net Income                      $           1,047   $            (451)
     YTD Return on Average Assets                 1.01%              -0.86%
     YTD Return on Average Equity                 3.25%              -2.54%
     YTD Net Interest Margin                      5.32%               4.18%
     YTD Efficiency Ratio                        74.84%              99.31%

     *Percentages are reported on an annualized basis.
     Source: FDIC quarterly Call Reports for Beach Business Bank for the
     periods indicated.

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