Plaza Bank Announces Financial Results for the Year and Quarter Ended December 31, 2015 (unaudited)

IRVINE, CA--(Marketwired - Feb 17, 2016) - Plaza Bancorp (OTCBB: PLZZ) (the "Company"), the holding company of Plaza Bank (the "Bank"), reported unaudited net income using the pooling of interest method, due to the Company's merger with Manhattan Bancorp, for the year ended December 31, 2015 of $4.67 million or $0.16 per share on a diluted basis. For the year ended December 31, 2014, the unaudited net income was $1.8 million or $0.06 per share on a diluted basis. For the year ended December 31, 2015, the Company's return on average assets was 0.44% and return on average equity was 4.24%, up from a return on average assets of 0.17% and a return on average equity of 1.36% for 2014.

Results for the year ended December 31, 2015 were affected by $4.9 million of expenses associated with the aforementioned merger and the sale of Manhattan Bancorp's mortgage division. Without these one-time expenses, the unaudited net income would have been $7.6 million or $0.25 per share on a diluted basis, the Company's return on average assets would have been 0.72% and return on average equity would have been 6.87%.

Net income for the quarter ended December 31, 2015 was $3.4 million or $0.11 per share on a diluted basis, a $2.2 million, or 72%, increase compared to the fourth quarter of 2014's results of $1.2 million or $0.04 per share on a diluted basis. For the quarter ended December 31, 2015, the Bank's return on average assets was 1.30% and return on average equity was 12.83%, up from a return on average assets of 0.47% and a return on average equity of 3.85% for the 2014 comparable period.

In the quarter ended December 31, 2015, the net income results benefited from one-time adjustments of $1.2 million for a tax correction related to the merger and $400,000 before income taxes for the termination of SouthWestUSA share loss agreements with the FDIC, respectively.

Gene Galloway, President and Chief Executive Officer of the Company and the Bank, commenting on the fourth quarter stated "The progress we have made in merging the two banks together is beginning to show results as we continue to revitalize and energize the branches we acquired. Our efficiency ratio and net interest margin improved over the third quarter of 2015 as we get more focus on running the combined institution rather than on merger related problems. Our loan volume in the fourth quarter topped $124 million, a record for the Bank and $53.4 million more than we did in the quarter following the merger. For 2016, we will continue to stride toward improving efficiency and profit by finalizing the blending of Manhattan and Plaza's cultures and employees together."

Highlights for quarter ended December 31, 2015 included:

• Loan originations by the Bank in the fourth quarter totaled $124.7 million
• Loans held for investment grew $52.9 million, or 25.5% annualized, to $882.2 million during the fourth quarter
• The Bank's loan to deposit ratio as of December 31, 2015 was 99.8%
• During the quarter, the Bank sold $16.7 million of SBA 7(a) loans that generated $1.0 million in gains
• For the quarter, the Company's and Bank's net interest margin ("NIM") improved five and seven basis points to 4.50% and 4.72%, respectively, compared to the quarter ended September 30, 2015
• Non-accrual loans totaled $1.4 million or 0.16% of the loans held for investment at December 31, 2015
• The ratio of allowance for loan losses to total loans was 1.30% at December 31, 2015
• The Company's efficiency ratio for the quarter improved to 60% compared to the prior quarter of 69%.
• Tangible book value per diluted share increased 9 cents to $3.22 during the fourth quarter.

Net interest income for the quarter ended December 31, 2015 totaled $11.3 million. Loan interest income totaled $12.5 million, the average of total outstanding loans for the quarter was $861.9 million and the annualized yield was 5.76%. Interest expense related to deposits was $916,000 for the quarter, or 41 basis points annualized. The interest expense related to the subordinated debentures for the quarter was $447,000, or 7.125 % annualized.

The Company recorded a $1.4 million provision for loan losses during the fourth quarter of 2015 as a result of the $52.9 million loan growth and $330,000 in net charge-offs during the quarter. Non-accrual loans totaled $1.2 million at 2015 year-end with one non-accrual loan totaling $108,000 being 90 days or more past due.

Non-interest income for the fourth quarter of 2015 was $3.0 million. Non-interest income for the fourth quarter is primarily comprised of net gain from the sale of loans of $1.0 million, loan servicing income of $285,000, deposit fee income of $300,000, loan referral fee income of $321,000 and other fee income totaling $623,000.

The fourth quarter of 2015 non-interest expense including merger expense totaled $8.8 million down $645,000 compared to the prior quarter primarily due to a reduction in merger related professional expenses in the third quarter totaling $577,000.

For the year and fourth quarter of 2015, the Company's effective tax rates were 41.9% and 17.5%, respectively, for a total tax expense of $3.4 million for the year and $723,000 for the quarter. In the fourth quarter, the Company recognized a $1.2 million tax benefit as part of the true-up of Manhattan Bancorp's deferred tax assets.

At December 31, 2015, the Company's ratio of tangible common equity to total assets was 8.61%, with a tangible book value of $3.22 per diluted share and a diluted book value per share of $3.57 per share.

At December 31, 2015, the Bank exceeded all regulatory capital requirements with a ratio for tier 1 leverage capital of 10.48%, common equity tier 1 risk-based capital of 11.44%, tier 1 risked-based capital of 11.44% and total risk-based capital of 12.70%. These capital ratios exceeded the "well capitalized" standards defined by the federal banking regulators of 5.00% for tier 1 leverage capital, 6.5% for common equity tier 1 risk-based capital, 8.00% for tier 1 risk-based capital and 10.00% for total risk-based capital. At December 31, 2015, the Company had a ratio for tier 1 leverage capital of 8.61%, common equity tier 1 risk-based capital of 9.42%, tier 1 risk-based capital of 9.42% and total risk-based capital of 13.30%.

About Plaza Bancorp
Plaza Bancorp is the holding company of Plaza Bank. Plaza Bank is a full service community bank serving the business and professional communities in Southern California and Southern Nevada. The Bank is committed to meeting the financial needs of small to middle market businesses and professional firms with loans for working capital, equipment and owner-occupied commercial real estate financing and a full array of cash management services. Plaza Bank meets its customers' needs through its eight regional offices located in the cities of El Segundo, Glendale, Irvine, Las Vegas, Manhattan Beach, Montebello, Pasadena and San Diego. For more information, visit www.plazabank.com or call President and CEO Gene Galloway at (949) 502-4309 or (702) 277-2221.

Forward-Looking Statements

Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and are subject to the safe harbors created by that Act. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." Forward-looking statements are based on currently available information, expectations, assumptions, projections, and management's judgment about the Company, the Bank, the banking industry and general economic conditions. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management's views as of any subsequent date. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely.

Forward-looking statements involve significant risks and uncertainties and actual results may differ materially from those presented, either expressed or implied, in this press release. Factors that might cause such differences include, but are not limited to: the Bank's ability to successfully execute its business plans and achieve its objectives; changes in general economic, real estate and financial market conditions, either nationally or locally in areas in which the Bank conducts its operations; changes in interest rates; new litigation or claims or changes in existing litigation or claims; future credit loss experience; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Bank's operations or business; loss of key personnel; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies; and the ability to satisfy requirements related to the Sarbanes-Oxley Act and other regulation on internal control.

Plaza Bank
Statements of Financial Condition
(Unaudited)
			December 31,				September 30,				December 31,
ASSETS			2015				2015				2014*
Cash and cash equivalents			$	97,576,000			$	135,225,000			$	96,386,000
Investment securities - available for sale				28,215,000				29,149,000				43,550,000
Loans held for sale				4,535,000				4,972,000				36,368,000
Loans held for investment				882,199,000				829,280,000				821,722,000
Allowance for possible credit losses				(11,506,000	)			(10,398,000	)			(9,426,000	)
Net loans held for investment				870,693,000				818,882,000				812,296,000
Goodwill and other intangibles				12,411,000				12,447,000				20,609,000
Idemnification asset				762,000				762,000				1,920,000
Accrued interest and other assets				30,473,000				29,147,000				40,142,000
TOTAL ASSETS			$	1,044,665,000			$	1,030,584,000			$	1,051,271,000
LIABILITIES AND STOCKHOLDER'S EQUITY
Deposits
Noninterest-bearing demand			$	320,265,000			$	299,398,000			$	311,351,000
Savings, now and money market accounts				356,343,000				358,713,000				322,241,000
Time deposits				211,998,000				221,863,000				251,729,000
	Total Deposits		$	888,606,000			$	879,974,000			$	885,321,000
Borrowings				24,000,000				24,000,000				29,000,000
Accrued interest and other liabilities				10,770,000				9,552,000				13,425,000
	Total Liabilities			923,376,000				913,526,000				927,746,000
Total Shareholder's Equity				121,289,000				117,058,000				123,525,000
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY			$	1,044,665,000			$	1,030,584,000			$	1,051,271,000
Capital Ratios End of Period:
	Tier 1 leverage ratio			10.48	%			10.12	%
	Tier 1 risk-based capital ratio			11.44	%			11.62	%
	Common equity tier 1 capital ratio			11.44	%			11.62	%
	Risk-based capital ratio			12.70	%			12.87	%

Plaza Bank
Statements of Operations
For the Quarter and Year Ended
(Unaudited)
		Quarter				Quarter				Year-to-Date				Year-to-Date
		December 31,				December 31,				December 31,				December 31,
		2015				2014*				2015*				2014*
Interest income			12,722,000				12,558,000				51,059,000				46,703,000
Interest expense			982,000				1,146,000				4,073,000				4,624,000
Net interest income		$	11,740,000			$	11,412,000			$	46,986,000			$	42,079,000
Provisions for loan losses			1,428,000				629,000				2,367,000				2,132,000
Net interest income after
provisions for loan losses			10,312,000				10,783,000				44,619,000				39,947,000
Noninterest income			2,736,000				5,069,000				10,830,000				23,493,000
Merger expense			(239,000	)			134,000				2,814,000				134,000
Noninterest expense			8,601,000				13,523,000				41,507,000				57,424,000
Income before income taxes			4,686,000				2,195,000				11,128,000				5,882,000
Provisions for income taxes			149,000				1,043,000				3,713,000				3,885,000
Net income		$	4,537,000			$	1,152,000			$	7,415,000			$	1,997,000
RETURN ON ASSETS			1.75	%			0.44	%			0.71	%			0.20	%
RETURN ON EQUITY			15.24	%			3.97	%			6.06	%			1.62	%
*Pooling of Interest

Plaza Bank
Loan Held for Investment Portfolio Composition
		December 31,				September 30,				December 31,
		2015				2015				2014*
		(unaudited)				(unaudited)				(unaudited)
Construction and land development			12,906,000				11,394,000				10,281,000
Commercial real estate and other			522,739,000				506,150,000				483,572,000
Commercial			162,485,000				149,310,000				183,097,000
Residential real estate			131,051,000				112,511,000				95,359,000
Consumer			56,656,000				53,238,000				52,001,000
Total		$	885,837,000			$	832,603,000			$	824,310,000
Allowance for loan losses			(11,506,000	)			(10,398,000	)			(9,426,000	)
Deferred loan fees and discounts, net of costs			(3,638,000	)			(3,323,000	)			(2,588,000	)
Total net loans		$	870,693,000			$	818,882,000			$	812,296,000
Non-Performing Assets
		December 31,				September 30,				December 31,
		2015				2015				2014*
		(unaudited)				(unaudited)				(unaudited)
Non-Accrual Assets
Loans		$	1,236,000			$	1,716,000			$	3,059,000
OREO			-				-				-
Delinquency
30 - 89 Days past due		$	3,487,000			$	667,000			$	2,504,000
90 days and greater			109,000				109,000				236,000

Plaza Bancorp
Statement of Financial Condition
For the Quarter and Year Ended
(Unaudited)
		December 31,			September 30,			December 31,
ASSETS		2015			2015			2014*
Cash and cash equivalents		$	97,576,000		$	135,225,000		$	96,888,000
Investment securities - available for sale			28,215,000			29,149,000			43,551,000
Loans held for sale			4,535,000			4,972,000			36,369,000
Loans held for investment			882,199,000			829,280,000			822,118,000
Allowance for possible credit losses			(11,506,000	)		(10,398,000	)		(9,426,000	)
Net loans held for investment			870,693,000			818,882,000			812,692,000
Goodwill and other intangibles			12,411,000			12,447,000			20,547,000
Idemnification asset			762,000			762,000			1,920,000
Accrued interest and other assets			36,540,000			36,737,000			42,964,000
TOTAL ASSETS		$	1,050,732,000		$	1,038,174,000		$	1,054,931,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits
Noninterest-bearing demand		$	316,516,000		$	295,096,000		$	305,601,000
Savings, now and money market accounts			355,515,000			357,899,000			326,630,000
Time deposits			211,998,000			221,863,000			251,729,000
	Total Deposits	$	884,029,000		$	874,858,000		$	883,960,000
Borrowings			48,696,000			49,000,000			29,000,000
Accrued interest and other liabilities			10,738,000			10,125,000			13,714,000
	Total Liabilities		943,463,000			933,983,000			926,674,000
Total Shareholders' Equity			107,269,000			104,191,000			128,257,000
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$	1,050,732,000		$	1,038,174,000		$	1,054,931,000
BASIC BOOK VALUE PER SHARE		$	3.57		$	3.47		$	4.35
TANGIBLE BOOK VALUE PER DILUTED SHARE		$	3.22		$	3.11		$	3.88
BASIC SHARES OUTSTANDING AT PERIOD END			30,034,244			30,040,003			29,509,737
DILUTED SHARES OUTSTANDING AT PERIOD END			30,296,867			30,363,214			30,368,310
Capital Ratios End of Period:
	Tier 1 leverage ratio		8.61	%		8.27	%
	Tier 1 risk-based capital ratio		9.42	%		9.44	%
	Common equity tier 1 capital ratio		9.42	%		9.44	%
	Risk-based capital ratio		13.30	%		13.46	%

Plaza Bancorp
Statement of Operations
For the Quarter and Year Ended
(Unaudited)
			Quarter				Quarter				Year-to-Date				Year-to-Date
			December 31,				December 31,				December 31,				December 31,
			2015				2014*				2015*				2014
Interest income				12,722,000				12,560,000				51,071,000				46,703,000
Interest expense				1,429,000				1,146,000				4,990,000				4,642,000
	Net Interest Income		$	11,293,000			$	11,414,000			$	46,081,000			$	42,061,000
Provisions for loan losses				1,428,000				629,000				2,367,000				2,132,000
Net interest income after
	Provisions for Loan Losses			9,865,000				10,785,000				43,714,000				39,929,000
Noninterest income				3,043,000				5,173,000				12,067,000				23,774,000
Merger expense				(215,000	)			134,000				4,916,000				134,000
Noninterest expense				9,002,000				13,554,000				42,838,000				57,921,000
Income before income taxes				4,121,000				2,270,000				8,027,000				5,648,000
Provisions for income taxes				723,000				1,037,000				3,362,000				3,897,000
Net Income			$	3,398,000			$	1,233,000			$	4,665,000			$	1,751,000
EARNINGS PER SHARE - BASIC			$	0.11			$	0.04			$	0.16			$	0.06
EARNINGS PER SHARE - DILUTED			$	0.11			$	0.04			$	0.16			$	0.06
BASIC WEIGHTED AVERAGE SHARES				30,038,188				29,509,737				29,775,876				29,509,737
DILUTED WEIGHTED AVERAGE SHARES				30,293,267				30,369,240				30,028,376				30,368,310
RETURN ON ASSETS				1.30	%			0.47	%			0.44	%			0.17	%
RETURN ON EQUITY				12.83	%			3.85	%			4.24	%			1.36	%
*Pooling of Interest