Bank of Commerce Grows Deposits and Loans, Posts Third Quarter Loss

CHARLOTTE, N.C., Oct. 20 /PRNewswire-FirstCall/ -- Bank of Commerce (OTC Bulletin Board: BONC) posted a net loss of $1,278,000 for the quarter ending September 30, 2009, compared to net income of $15,000 for the same period last year. Total assets have grown from $145.5 million at December 31, 2008 to $175.7 million as of September 30, 2009 with gross loans increasing to $124.6 million and deposits increasing to $111.1 million.

Strong operating earnings for the quarter were offset by a significant increase in loan loss reserves. Dramatic decreases in real estate value prompted the Bank to re-appraise many of the real estate backed loans in its portfolio to determine if they were adequately collateralized. For those that had a collateral deficiency the Bank either requested additional collateral from the borrower or increased loan loss reserves accordingly. This loan loss reserve expense is the direct cause of the third quarter loss. During the third quarter $1,679,000 was added to the allowance for loan losses primarily a result of loan charge-offs of $2,341,000.

"Bank of Commerce continues to exceed the FDIC's well capitalized standards," said Wes Sturges, President & CEO. "We have taken an aggressive approach in loan charge-offs, which we feel positions us appropriately in the current real estate market."

The Bank's net loss for the nine months ended September 30, 2009 was $3,848,000, compared to net income of $201,000 for the same period last year. During the year, $4,651,000 was added to the allowance for loan losses primarily as a result of loan charge-offs of $4,497,000.

Bank of Commerce serves the needs of independently owned businesses in the Charlotte, N.C. area. From a midtown Charlotte office at 100 Queens Road, we offer guidance to clients from experienced loan officers, in addition to start-up financing and other banking products, services and information. Online banking, courier service and extended deposit hours are additional hallmarks of Bank of Commerce. The Bank's common stock is quoted in the over-the-counter market through the OTC Bulletin Board under the symbol "BONC.OB." The FDIC has extended its coverage from $100,000 to $250,000 until December 31, 2013. Additionally, the Bank participates in the Transactional Account Guarantee Program that fully guarantees all balances in non-interest bearing transaction accounts until June 30, 2010. For additional information, contact Bank of Commerce Headquarters, 100 Queens Road, Charlotte, N.C. (telephone 704-971-7000) or visit

This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of Bank of Commerce. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Bank and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like "expect," "anticipate," "estimate" and "believe," variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. The Bank does not undertake an obligation to update any forward-looking statements.

    Bank of Commerce
    2009 Third Quarter Report

    Balance Sheets
    In Thousands
                                             September 30,     December 31,
                                                 2009             2008
                                                 ----             ----
    Assets                                   (unaudited)       (audited)
    Cash                                           $439             $555
    Federal funds sold                            6,387            3,805
    Investment securities                        40,469           29,438
    Loans, gross                                124,634          108,379
    Allowance for loan losses                    (1,677)          (1,523)
    Other assets                                  5,443            4,796
                                                  -----            -----
              Total assets                     $175,695         $145,450
                                               --------         --------

    Liabilities and Shareholders' Equity
    Deposits                                   $111,106          $83,820
    Borrowed funds                               48,481           43,557
    Other liabilities                               890            2,241
    Shareholders' equity                         15,218           15,832
                                                 ------           ------
              Total liabilities and
               shareholders' equity            $175,695         $145,450
                                               --------         --------
    Statements of Operations
    In Thousands

                         For the Quarter Ending      For Nine Months Ending
                       September 30, September 30, September 30, September 30,
                           2009          2008          2009          2008
                           ----          ----          ----          ----

    Total interest
     income               $2,024        $1,686        $5,725        $4,753
    Total interest
     expense                 777           673         2,403         1,876
                             ---           ---         -----         -----
    Net interest income    1,247         1,013         3,322         2,877
    Provision for loan
     losses                1,679           190         4,651           414
                           -----           ---         -----           ---
    Net interest income
     (loss) after
     provision for loan
     losses                 (432)          823        (1,329)        2,463
    Total other income       180            57           452           245
    Total other expense    1,026           865         2,971         2,507
                           -----           ---         -----         -----
        Income (loss)
         before taxes     (1,278)           15        (3,848)          201
    Provision for income
     taxes                     -             -             -             -
                             ---           ---           ---           ---
        Net income
         (loss)           (1,278)           15        (3,848)          201
    Preferred stock
     dividend                 48             -           139             -
                             ---           ---           ---           ---
        Net income (loss)
         applicable to
         shareholders    $(1,326)          $15       $(3,987)         $201
                         -------           ---       -------          ----

SOURCE Bank of Commerce


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