Founders Community Bank Announces Third Quarter Results

SAN LUIS OBISPO, Calif., Oct. 19, 2012 /PRNewswire/ -- Founders Community Bank, a wholly-owned subsidiary of Founders Bancorp (OTCBB: FBCP) today reported net income of $262 thousand for the three months ended September 30, 2012, up 117 percent from $121 thousand in net income for the quarter ended September 30, 2011.  Net income for the nine months ended September 30, 2012 was $614 thousand versus $258 thousand for the nine months ended September 30, 2011, an increase of 138 percent.

"We are very pleased to continue our established pattern of growth and profitability for another quarter. As of September 30, 2012 the Bank reported total loans of $87.6 million versus $83.3 million at September 30, 2011, an increase of $4.3 million or 5 percent," said Chief Executive Officer Thomas J. Sherman.

"The growth in the loan portfolio this quarter was enhanced by the opening of the Bank's Morro Bay branch, our third full-service branch.  In addition the Bank opened a Loan Production Office in Atascadero last November.  These two opportunities have allowed the Bank to provide services to an extended market with San Luis Obispo County.  In addition to the loan growth, the Bank experienced growth in non-interest bearing deposits in the last 12 months of $7.4 million, going from $44.5 million at September 30, 2011 to $51.9 million at September 30, 2012, an increase of 17 percent.  Non-interest bearing deposits now represent 46 percent of the Bank's total deposits.  As a result, net interest income for the nine months ended September 30, 2012 was $4.4 million versus $3.7 million for the same period in 2011, an increase of $666 thousand."

"The Bank also continued to enhance its strong credit quality this quarter with no loans past due more than 30 days and no loans on non-accrual.  Additionally, Other Real Estate Owned totaled $754 thousand at September 30, 2012, down $256 thousand from $1.0 million at September 30, 2011," said Sherman.    

Third Quarter 2012 Highlights
(at or for the quarter ended September 30, 2012, compared to September 30, 2011 unless otherwise noted)

• Net income grew by $141 thousand in the third quarter 2012 to $262 thousand or 117 percent over the same period in 2011.
• Net income before Provision for Income Tax Expense grew by $321 thousand in the third quarter 2012 to $452 thousand or 245 percent over the third quarter 2011.
• Total interest income for the quarter increased to $1.6 million, up $221 thousand or 16 percent from the third quarter 2011 primarily due to organic loan growth.
• Net interest margin was 4.25 percent in the third quarter 2012 up from 4.23 percent in the second quarter 2011.
• Total asset growth of $4.6 million or 3.7 percent from September 30, 2011.
• Total loans grew to $87.6 million, a $4.4 million or 5 percent increase from September 30, 2011.
• Continued strong loan quality with net recoveries of $9 thousand for the nine months ending September 30, 2012, versus net charge-offs of $179 thousand for the nine months ending September 30, 2011.
• Total deposits grew to $113 million, a $3.7 million or 3.4 percent increase from September 30, 2011.
• Noninterest bearing deposits increased to $51.9 million or 46 percent of total deposits at September 30, 2012.  Noninterest bearing deposits grew $7.4 million or 16.7 percent from September 30, 2011.
• Cost of deposits declined to 0.22 percent versus 0.36 percent at September 30, 2011.  Interest expense fell to $65 thousand for the third quarter 2012 versus $105 thousand in the third quarter of September 30, 2011, a decline of 38 percent.
• Capital Ratios continued to exceed all regulatory requirements to be "well-capitalized", the highest regulatory category:

For additional information please review the Bank's website at www.fcbslo.com.

Founders Community Bank - Built on a foundation of success

Forward-Looking Statement Disclaimer –
This release may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties may include but are not necessarily limited to the Company's ability to sustain dividend payments, fluctuations in interest rates, monetary policy established by the Federal Reserve, inflation, government regulations, general economic conditions, and competition within the business areas in which the Company is conducting its operations, including the real estate market in California, the ability to recognize identified cost savings, and other factors beyond the Company's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

Press Release Contact:         Mandy Leastman 
Phone:                                      805.547.2527

SOURCE Founders Community Bank