ICB Financial 2010 Financial Performance

ONTARIO, Calif., Jan. 24, 2011 /PRNewswire/ -- ICB Financial (OTC Bulletin Board: ICBN)

Letter to Our Customers and Shareholders

While local economic conditions and markets again proved to be challenging in 2010, ICB Financial (ICBF) and its subsidiary, Inland Community Bank, N.A. (ICB), remain financially strong and through the tireless efforts of our management team we continued to build on steps taken in the previous year to return to profitability. ICB contributed a net profit of $1.551 million for 2010 compared to a net loss of $4.854 million in 2009.

In an economy that has been slow to recover we have continued to play a significant role in supporting businesses by helping them rebound from a serious recession, create jobs, and spur economic growth. Our focus is to remain competitive to attract new business with responsible lending practices.

Despite a declining interest rate environment and competitive pricing that continues to pressure margins, we were able to maintain a healthy annualized net interest margin of 4.11%. This compares favorably to 3.96%, the net interest margin of our regulatory peer group.

Our area's economic conditions as well as our work to continue strengthening the loan portfolio resulted in a 10% decrease in loan volume from the previous year. Total Held to Maturity (HTM) loans were $168.5 million, compared to $188.1 million at December 31, 2009. Although our loan losses from the sluggish business climate in the Inland Empire required a provision for loss of $585,000, this was a substantial decrease from the $6.9 million loan loss provision in 2009. Expenses such as $336,000 for FDIC insurance remain high.

We have been consistent in providing the necessary reserves to adequately cover all identified and potential losses in our loan portfolio, resulting in an increase in our Allowance for Loan Losses from 2.19% of total HTM loans at the end of 2009 to 2.58% of total HTM loans at the end of 2010, and we will be diligent in this effort in the year ahead. We continue to emphasize a strong governance and risk framework for disciplined risk management.

While it has been difficult in the past year to expand our banking franchise, we are committed to building a foundation for long-term growth and profitability. ICB has continued to navigate through the complex regulatory and business environment and exceeds the "well capitalized" benchmarks established by the regulators. We further strengthened the ICB capital ratios in 2010, which now stand at 15.25% for Total Risk-Based Capital (the minimum for "well-capitalized" status is 10%) and 10.25% for Tier 1 Leverage Capital (the minimum for "well-capitalized" status is 5%). Our strong capital position enables us to withstand the challenges of an uncertain economy. We will continue to fortify our capital and liquidity positions; cash and securities increased 33% in 2010 over 2009, which also substantially increased our liquidity position.

The improvement in our capital position has been due to efforts on the part of ICB's management team in controlling asset quality and operating expenses. The increase in ICBF's consolidated net income from a loss of $5.6 million in 2009 to a profit of $886,000 in 2010 demonstrates management's strong commitment to operate a sound community bank that provides outstanding service to the businesses in its service area.  

With a 21-year track record as a vital and strong community bank, we move into 2011 confident in our core strengths and capabilities to manage the economic challenges and position ourselves to expand our franchise as the business climate turns more positive. The ICB team of banking professionals continues to focus on remaining a reliable source of strength that offers tangible assistance and tools for the business community to recover and thrive in the years ahead.

As we remain committed to creating long-term value for the ICB franchise and meeting the needs of the business community in the Inland Empire, we once again appreciate the dedication of our employees and recognize the valuable and ongoing support of our customers and shareholders.

James S. Cooper

President and Chief Executive Officer

Financial Performance benchmarks for the year ended December 31, 2010 include:

• Total assets decreased 6.3%; $285.5 million at December 31, 2009 compared to $267.6 million at December 31, 2010, a decrease of $17.9 million.
• Total HTM loans of $168.5 million in 2010, which represented a 10% decrease compared to $188.1 million in 2009.
• Total deposits for 2010 were down 7.0% or $17.5 million compared to 2009.
• The efficiency ratio for 2010 was 75.5%, a significant improvement from 97.5% in 2009.
• Non-performing assets increased to 4.4% of total assets at December 31, 2010 compared to 3.4% at December 31, 2009.
• Provision for loan and lease losses for ICBF was $585,000 for 2010 compared to $7,471,000 for 2009.
• Net earnings per common share for 2010 were $0.17 compared to net loss of ($1.09) in 2009.
• Gross interest revenue of $13.1 million for 2010 compared to $13.8 million for 2009, a decrease of 5.3%.
• Important ICB Ratios at December 31, 2010:
  • Total Risk-Based Capital – 15.25%; minimum for well capitalized under regulatory guidelines is 10.00%.
  • Tier 1 Leverage Capital – 10.0%; minimum for well capitalized under regulatory guideline is 5.0%.
  • ALLL as a percent of HTM loans – 2.62%.
  • Net charge-offs for 2010 as a percent of 2010 average total loans – 0.21%.
  • Total OREO, Delinquent and Non-accrual loans to total risk-based capital – 32.2%, which is also equivalent to 6.1% of total loans at December 31, 2010.
  • Average Net Interest Margin for 2010 was a healthy 4.28%.

Forward-looking statements      

Certain statements in this press release constitute forward-looking statements that are based upon current management expectations and, therefore, are subject to certain risks and uncertainties that could cause actual results, performance, or achievements to differ materially from those expressed, suggested, or implied. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. Often, they include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may."  Forward-looking statements are effective only as of the date that they are made, and ICB Financial assumes no obligation to update this information to reflect occurrences or unanticipated events or circumstances after the date of such statements.

SOURCE Inland Community Bank, N.A.