Greater Sacramento Bancorp 2011 Net Income More Than Triples 2010 Income

SACRAMENTO, Calif., Feb. 7, 2012 /PRNewswire/ -- For the full year of 2011 Greater Sacramento Bancorp (OTC: GSCB.OB) (GSB), parent company of Bank of Sacramento (BOS), reported Net Income of $2,338,000 ($.89 per share diluted) compared to Net Income of $713,000 ($.27 per share diluted) for the full year of 2010 representing a 228% increase.

Net Income for the Fourth Quarter of 2011 of $601,000 ($.23 per share diluted) represents the seventh consecutive quarter of positive earnings and was down slightly (2%) from the Fourth Quarter 2010 Net Income figure of $612,000 ($.23 per share diluted).

The substantial improvement in the income for the full year of 2011 compared to 2010 was primarily due to the significant improvement in the overall quality of the loan portfolio.  During 2010 loan loss provision expenses were $4,030,000 compared to $1,095,000 in 2011; a 73% reduction.  Likewise OREO carrying expense and valuation allowance which was $2,253,000 in 2010 fell 64% to $800,000 in 2011.

Net Interest Income for the year 2011 was $14,283,000 or 8% less than 2010's Net Interest Income figure of $15,449,000.  This reduction was a reflection of both falling interest rates during 2011 and a reduction in loan outstandings.

Regarding GSB's performance during 2011 CEO and Chairman, William J. Martin, commented: "Management and the Board are extremely pleased with the present financial condition of the Bank following the economic and financial crisis that swept not only our market but the nation as a whole.  During the past several years we have diligently and successfully addressed our problem loans and the results of these efforts are witnessed by our 2011 earnings performance.  While the local economy has been slow resulting in very low loan demand, we are beginning to see increased activity and demand and are guardedly optimistic that 2012 will see an improvement in our core earnings as well as a continuation of our high level of asset quality."

Key asset quality indicators for BOS over the past five quarters witness the improvement in quality:

• Ratio of Non-Performing Loans plus OREO to Total Assets:

• Ratio of Non-Performing Assets to Equity Capital plus Loan Loss Reserve ("Texas Ratio"):

• OREO Balance ('000s omitted):

• Allowance for Loan Loss to Total Loans:

Of particular note concerning the Bank's December 31, 2011 Loan Loss Reserve, the reserve is 853% of non-current loans (Loans past due 90 days or more plus non-accrued loans).  This is significantly more than the Third Quarter 2011 national average of 64% for our peer banks and demonstrates our substantial coverage for future losses.

As of December 31, 2011 the Bank's Tier One Capital stood at $38,159,000 and GSB's Tier One Capital was $39,131,000.  The Leverage Capital Ratio for the Bank and GSB were 9.36% and 9.58%, respectively.  By all regulatory measures the Bank and GSB are considered well capitalized.

Comparing income statements and balance sheets for the years ending December 31, 2011 and December 31, 2010 the following highlights are noted:

• Net Interest Income in 2011, as mentioned earlier, was down 8% ($1,166,000) from 2010.  For the Fourth Quarter 2011 Net Interest Income was down 6% ($226,000) from Fourth Quarter 2010.  The 5% decrease in loan outstandings in 2011 and falling rates caused this reduction.  For the comparative twelve month periods Net Interest Margin fell from 4.52% in 2010 to 4.06% in 2011.
• Non-Interest Income year to year was down 7% in 2011:  $2,379,000 in 2010 and $2,214,000 in 2011.  While service charges and fees increased year to year by $359,000, gains on the sales of securities decreased in 2011 by $524,000.
• Non-Interest Expense in 2011, excluding OREO Expense and Valuation Allowance, was virtually unchanged from 2010:  $11,044,000 in 2010 compared to $11,160,000 in 2011.
• The Provision for Possible Loan Losses plus OREO Expense and Valuation Allowance for 2011 was $1,895,000 representing a 70% improvement over the 2010 total of $6,283,000.
• Total Deposits at December 31, 2011 stood at $343,062,000, an 11% increase over the December 31, 2010 figure of $310,121,000.
• Total Loans at December 31, 2011 were $227,667,000, down 5% from Total Loans at December 31, 2010 of $239,227,000.  The year to year reduction was reflective of various factors:  The culling of problem loans; the deleveraging actions taken by certain borrowers; and the general slowness of the economy.

A copy of the company's information and disclosure statement pursuant to Securities and Exchange Commission Rule 15c2-11 can be found on the home page of the company's website at www.bankofsacramento.com under the title Investor Relations.

Contact:          William J. Martin, CEO and Chairman, 916-648-2100

This report may contain forward-looking statements that are subject to risks and uncertainties.  Such risks and uncertainties may include but are not necessarily limited to fluctuations in interest rates, inflation, government regulations and general economic conditions, and competition within the business areas in which the Company is conducting its operations, including the real estate market in California 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.

SOURCE Greater Sacramento Bancorp