Community Bank of the Bay Names William S. Keller Chief Executive Officer and Announces 2012 First Quarter Earnings

OAKLAND, CA--(Marketwire - May 24, 2012) - Community Bank of the Bay (OTCBB: CBYAA), a San Francisco Bay Area bank with locations in Oakland, Danville and San Jose, named banking veteran William Keller as its Chief Executive Officer and announced operating results for its first quarter ended March 31, 2012.

Mr. Keller has been serving as the Bank's President and Chief Operating Officer since early 2009 and brings over twenty years of banking experience to his position at Community Bank. Prior to joining the Bank, Mr. Keller was Chief Operating Officer at Diablo Valley Bank from its inception in 2003 to its successful sale. Preceding Diablo Valley Bank, he was Chief Executive Officer of Bay Bank of Commerce and Executive Vice President of Mid Peninsula Bank, both wholly owned subsidiaries of Greater Bay Bancorp, where he was a member of the Senior Management Committee and managed the Bank's initial expansion into the East Bay. Prior to joining Greater Bay Bancorp in 1999, Mr. Keller was with Oakland-based Civic Bank of Commerce for nine years, where he was a senior vice president and regional manager.

"Bill was instrumental in developing and executing the business and capital plan that allowed Community Bank to expand into two new markets and set the ground work for our goal of becoming the premier relationship bank in the Bay Area," said Frank Tsai, Chairman of Community Bank. "Bill's experience, market knowledge, client relationships and leadership capabilities make him uniquely qualified for this position and we are extremely pleased that he will be leading our team."

"In the last three years Community Bank has developed a presence in both the Diablo Valley and Silicon Valley regions to complement its traditionally strong Oakland market position," said Mr. Keller. "The fact that this was accomplished during an extremely difficult economic period is a testament to the deep relationships our bankers have within their communities. I am proud to be part of this team of dedicated and hard working professionals who truly believe in their clients and want to provide them with the best in personalized banking services."

2012 First Quarter Earnings

• Net Income for the 2012 First Quarter totaled $256 thousand, or $0.06 diluted earnings per share, an increase of $150 thousand, or 141 percent, from $106 thousand, or $0.03 diluted earnings per share, reported in the 2011 First Quarter.
  
  
• 2012 First Quarter Net Income included $158 thousand of income from the sale of securities verse $373 thousand in the 2011 First Quarter.
  
  
• Deposits grew $5.1 million to $110.4 million in the First Quarter 2012. Deposits have grown $13.0 million, or 13.4 percent, since the end of the 2011 First Quarter.
  
  
• Loans declined $2.2 million to $95.7 million in the First Quarter 2012. Loans have grown $7.5 million, or 8.5 percent, since the end of the 2011 First Quarter.
  
  
• Non-Accrual Loans increased to $4.9 million, or 5.11 percent of Total Loans, at March 31, 2012, versus $3.8 Million, or 3.84%, at the end of the 2011 Fourth Quarter and $4.0 million, or 4.53 percent, at the end of the 2011 First Quarter.
  
  
• Net Interest Margin increased one basis point to 4.69 percent, compared with 4.68 percent for the 2011 Fourth Quarter and 4.46 percent for the 2011 First Quarter
  
  
• Capital Levels remains well above FDIC "Well Capitalized" standards. First Quarter 2012 Equity of $15.5 million resulted in Tier 1 Leverage 11.71 percent and Tier 1 Risk-Based and Total Risk-Based Capital Ratios of 15.63 percent and 16.89 percent respectively.
  
  

Net income for the 2012 first quarter totaled $256 thousand, or $0.06 diluted earnings per share, versus $106 thousand, or $0.03 diluted earnings per share, for the 2011 first quarter. The increase in net income for the 2012 first quarter, versus the comparable quarter last year, is primarily due to a $154 thousand increase in net interest income after loan loss provision and $153 thousand decrease in non-interest expenses. These two positive factors were partially offset by a $215 thousand decrease in securities gains, primarily gains on sale of SBA loans.

The growth in net interest income for the 2012 first quarter increased primarily due to growth in average interest-earning assets. Total assets reached $135.0 million at March 31, 2012, an increase of $12.2 million, or 9.9 percent, from $122.9 million at March 31, 2011. Average earning assets for the 2012 first quarter reached $108.3 million, an increase of $8.0 million, or 7.2 percent, compared with the 2011 first quarter.

Deposits for the first quarter increased $5.1 million, or 4.9 percent, to $110.4 million at March 31, 2012. When compared with deposits at March 31, 2011, overall deposit growth for the last twelve months was $13.0 million, or 13.4 percent.

"We are extremely pleased with the way 2012 started. This is the first quarter since our mid-2010 capital raise and expansion effort that the Bank has reported a net profit after loan loss provision and before potentially one-time earnings such as gain on sale of securities and SBA loans and the Bank Enterprise Award. We look forward to building on these positive results; however, we recognize that we have considerable work ahead of us as we continue to expend effort and resources to improve our asset quality, while we continue to serve our clients and communities," stated William S. Keller, President and Chief Executive Officer.

Loans for the first quarter declined $2.2 million, or 2.2 percent, to $95.7 million at March 31, 2012. When compared with March 31, 2011, loan growth over the last twelve months was $7.5 million, or 8.5 percent. In addition the Bank sourced and sold for a premium $6.4 million of SBA guaranteed loans.

Non-Accrual Loans for the first quarter were $4.9 million, or 5.11 percent of Total Loans, at March 31, 2012, including $894 thousand of loans guaranteed by the U.S. Small Business Administration.

Frank Tsai, Chairman of the Board added, "This is an exciting time for our Bank. We have appointed a new CEO who has a demonstrated record of successfully growing financial institutions, and after three years which included a successful capital campaign and the addition of five new Directors, our Bank is beginning to see the results of its strategy. The attainment of 'core-profitability' in first quarter is an important milestone on our journey."

About Community Bank of the Bay

Community Bank of the Bay (OTCBB: CBYAA) serves the financial needs of closely held businesses and professional service firms, as well as their owner-operators and non-profit organizations throughout the San Francisco Bay Area. Community Bank of the Bay is a member of the FDIC, an SBA Preferred Lender, and a CDARS depository institution, headquartered in Oakland, with offices in San Jose, and Danville, CA. The bank is recognized for establishing the Bay Area Green Fund to provide financing to sustainable businesses and supports environmentally responsible values. Additional information on the bank is available online at www.communitybankbay.com.