Sierra Vista Bank Reports Earnings in 4Q12

FOLSOM, CA--(Marketwire - Jan 28, 2013) - Sierra Vista Bank (OTCQB: SVBA) today reported earnings of $38,000, for the fourth quarter of 2012, compared to $64,000 for fourth quarter 2011. Sierra Vista Bank has now been profitable for nine consecutive months, including the second, third and fourth quarter of 2012. The Bank showed a net loss of $485,000 for the year ending December 31, 2012 due to a large loan loss provision and a specific reserve in the first quarter. All financial results are preliminary and unaudited.

The Bank continued to show a strong net interest margin of 5.07% for the fourth quarter 2012 and 4.92% for the year, fueled by a yield on earning assets of 5.29% and a cost of funds of 0.24%. "We are finding opportunity as our market area continues to experience slow but steady economic improvement," stated Gregory Patton, President & CEO. 

In the third quarter of 2012 the Bank completed a Public Offering increasing capital by over $2 million with an additional $235,000 contributed during the fourth quarter of the year from an Accredited Investor whom the Bank has entered in to an agreement with for an additional $1.4 million subject to regulatory approval. The capital received has substantially strengthened the Bank's balance sheet and increased the capital level on December 31, 2012 to $10 million creating a leverage ratio of 12.48%. This compares to a leverage ratio of 9.02% on March 31, 2012 and 10.01% on December 31, 2011.

Financial Highlights (at or for the quarter ended December 31, 2012)

• The net interest margin was 5.07% for the fourth quarter and 4.92% for the year.
• Non-interest bearing deposits represented 31.7% of total deposits at December 31, 2012.
• Provisions for loan losses for the quarter were $80,000, well below the $165,000 one year earlier.
• Capital levels increased and remain well above the regulatory "well-capitalized" minimum levels:
  • The Tier 1 Leverage Capital ratio improved to 12.48% compared to 10.01% as of December 31, 2011.
  • The Tier 1 Risk Based Capital ratio improved to 15.92% compared to 13.46% as of December 31, 2011. 
  • The Total Risk Based Capital ratio improved to 17.19% compared to 14.74% as of December 31, 2011. 

Sierra Vista Bank had total assets of $78.8 million at December 31, 2012, compared to $77.9 million at September 30, 2012. Net loans increased to $59.6 million at the end of December compared to $58.4 million at September 30, 2012. Deposits totaled $66.0 million at December 31, 2012, compared to $66.8 million at September 30, 2012. 

Non-performing assets totaled $4.1 million at the end of December 2012 compared to $4.4 million at the end of December 2011. Non-performing assets include loans classified as non-accrual of $2.5 million and real estate owned of $1.6 million at December 31, 2012. The real estate owned balance of $1.6 million includes the Bank's headquarters totaling $1.5 million. Non-performing loans to total loans as a ratio decreased substantially from 6.67% on December 31, 2011 to 4.07% on December 31, 2012. With the exception of $482,000, all non-accruing loans are current under their original terms or are paying as agreed under forbearance agreements.

About Sierra Vista Bank
Sierra Vista Bank is a locally owned community bank headquartered at 1710 Prairie City Road in Folsom, California since March 2007 and has a branch located in the Sam's Town Center in Cameron Park. The Bank prides itself on serving the financial needs of small businesses and professionals in Folsom and throughout the Highway 50 Corridor while remaining committed to community philanthropy. Additional information about Sierra Vista Bank can be found at www.sierravistabank.com or by calling (916) 850-1500.

Forward Looking Statement:
In addition to historical information, this press release includes forward-looking statements, such as statements regarding increases in non-interest income, future profitability, the bank's ability to address challenges impacting economy in which it operates and future loan losses, which reflect management's current expectations for the bank's future financial results and business prospects. Forward-looking statements are inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to: (a) changes in competitive pressures among depository and other financial institutions or in the bank's ability to compete effectively against larger financial institutions in its banking market; (b) actions of government regulators or changes in laws, regulations or accounting standards, that adversely affect the bank's business; (c) changes in interest rates and/or inflation; (d) changes in general economic or business conditions and the real estate market in the bank's market; and (e) other unexpected developments or changes in the bank's business or its customers' businesses. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. You should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

SIERRA VISTA BANK
CONSOLIDATED BALANCE SHEETS
(unaudited)
($000s)				12/31/12				09/30/12				12/31/11
ASSETS
Cash and due from banks				$	3,053			$	2,856			$	4,545
Federal funds sold					1,460				970				4,160
Investment securities, available-for-sale					11,858				12,762				10,938
Gross loans					61,025				59,805				61,130
	Net deferred (fees)				(31	)			(33	)			(39	)
	Allowance for loan losses				(1,391	)			(1,343	)			(2,033	)
		Net loans			59,603				58,429				59,058
Premises and equipment, net					735				750				813
Accrued interest receivable					277				247				253
Other real estate					1,571				1,581				339
Other assets					234				307				427
TOTAL ASSETS				$	78,791			$	77,902			$	80,533
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing demand deposits				$	20,926			$	23,416			$	22,024
Interest-bearing demand deposits					2,846				2,714				1,865
Savings and money market deposits					13,699				13,439				14,226
Time deposits					28,487				27,266				31,837
TOTAL DEPOSITS					65,958				66,835				69,952
FHLB borrowings					2,500				1,000				2,000
Accrued interest payable					16				17				31
Accounts payable and other liabilities					366				349				377
TOTAL LIABILITIES					68,840				68,201				72,360
Common stock					19,961				19,727				17,727
Additional paid-in capital					377				377				377
Accumulated deficit					(10,476	)			(10,517	)			(10,001	)
Accumulated other comprehensive income					89				114				70
TOTAL STOCKHOLDERS' EQUITY					9,951				9,701				8,173
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY				$	78,791			$	77,902			$	80,533

SIERRA VISTA BANK
CONSOLIDATED INCOME STATEMENTS
(unaudited)
				For the Three Months Ended:												For the Twelve Months Ended:
($000s, except per share data)				12/31/12				9/30/12				12/31/11				12/31/12				12/31/11
Interest income
	Loans			$	931			$	896			$	995			$	3,653			$	4,147
	Investment securities				67				67				63				291				339
	Federal Funds sold				2				2				3				11				11
		Total interest income			1,000				965				1,061				3,955				4,497
Interest expense
	Deposits				41				43				73				207				412
	FHLB borrowings				1				0				1				2				33
		Total interest expense			42				43				74				209				445
		Net interest income			958				922				987				3,746				4,052
Provision for loan and lease losses					80				60				165				1,030				645
		Net interest income after provision for loan losses			878				862				822				2,716				3,407
Noninterest income
	Customer service and other fees				100				121				66				432				234
	Gain (loss) on sale of loans				0				0				0				0				15
	Gain (loss) on sale of other real estate				0				0				0				56				6
	Gain (loss) on available-for-sale securities				41				20				77				193				301
		Total noninterest income			141				141				143				681				556
Noninterest expense
	Salaries and employee benefits				479				495				453				2,036				1,877
	Occupancy and equipment				156				157				159				619				665
	Other general and administrative				346				283				289				1,227				1,262
		Total noninterest expense			981				935				901				3,882				3,804
		Net income (loss)		$	38			$	68			$	64			$	(485	)		$	159
Earnings (loss) per share				$	0.01			$	0.03			$	0.03			$	(0.20	)		$	0.08
Tangible book value per share				$	2.96			$	3.00			$	4.02			$	2.96			$	4.02
Net interest margin					5.07	%			4.93	%			5.10	%			4.92	%			5.04	%
Asset Quality:
Non-performing loans to total loans					4.07	%			3.66	%			6.67	%			4.07	%			6.67	%
Non-performing assets to total loans and ORE					6.47	%			6.14	%			7.18	%			6.47	%			7.18	%
Non-performing assets to total assets					5.14	%			4.84	%			5.48	%			5.14	%			5.48	%
Allowance for loan losses to total loans					2.28	%			2.25	%			3.33	%			2.28	%			3.33	%
Allowance for loan losses to non-performing loans					56.04	%			61.30	%			49.89	%			56.04	%			49.89	%
Other real estate				$	1,571			$	1,581			$	339			$	1,571			$	339
Selected Financial Ratios:
Tier 1 leverage capital ratio					12.48	%			12.16	%			10.01	%			12.48	%			10.01	%
Tier 1 risk-based capital ratio					15.92	%			15.66	%			13.46	%			15.92	%			13.46	%
Total risk-based capital ratio					17.19	%			16.92	%			14.74	%			17.19	%			14.74	%