Santa Cruz County Bank Reports Record First Quarter 2010 Earnings

SANTA CRUZ, Calif., April 20 /PRNewswire-FirstCall/ -- Santa Cruz County Bank, (OTC Bulletin Board: SCZC), a locally owned and operated full-service community bank headquartered in Santa Cruz County, today announced earnings for the first quarter of 2010. For the quarter ended March 31, 2010, the Bank reported net income of $267,980, an increase of $196,733 over the $71,247 reported for the quarter ended December 31, 2009 and an increase of $245,471 over the quarter ended March 31, 2009.

The Bank's performance included sizable growth in interest income of 10% and non-interest income of 43%, while managing non-interest expense to a marginal increase of only 1% in comparing year to year first quarter results.

Total assets increased $30.3 million to $266.7 million at March 31, 2010, compared to $236.4 million at March 31, 2009. Gross loans increased $15.0 million, 11%, to $154.9 million over the same period for the prior year. While maintaining a focus on cost of funds, total deposits increased $28.7 million, 13%, from March 31, 2009 to March 31, 2010 with non interest bearing deposits increasing 20%.

Net interest income increased by $439,567 for the quarter ended March 31, 2010 compared to the same period for the prior year. This was attributable to an increase in interest income combined with a decrease of $166,187, 36%, in interest expense even though deposits grew 13%. For the quarter ended March 31, 2010 compared to the quarter ended December 31, 2009, net interest income increased by $78,088. Interest expense declined from $466,018 in the quarter ended March 31, 2009 to $299,831 in the comparable quarter in 2010. The Bank's non-interest income increased $142,058 during the quarter ended March 31, 2010 compared to the prior year.

The increase in non-interest expense was contained to $30,875 during the quarter ended March 31, 2010 compared to the same quarter one year ago. Non-interest expense declined by $64,428, 3%, during the quarter ended March 31, 2010 compared to the quarter ended December 31, 2009, as a result of management's ongoing emphasis on expense control and increased efficiencies.

During the quarter the Bank's Small Business Administration (SBA) and Business and Industry (B&I) Department ranked 13th in the Nation for providing $18.6 million in Business and Industry loans to small businesses during the USDA's fiscal year ended 2009. Also during the quarter, the Bank celebrated the one year anniversary of its Aptos banking office in February. This location has grown to nearly $10 million in deposits since opening.

President and Chief Executive Officer, David Heald stated, "We are pleased to report a record first quarter for 2010 and the ongoing accomplishments of our SBA Department. As always, we remain focused on building value for our shareholders."

Annual Meeting Notice

The Bank's Annual Meeting of Shareholders will be held on May 25, 2010 at Bittersweet Bistro, 787 Rio Del Mar Boulevard, Aptos, California at 3:00 p.m. Pacific Standard Time.

About Santa Cruz County Bank

Headquartered in Santa Cruz, Santa Cruz County Bank is a full service bank serving the banking needs of individuals and businesses throughout Santa Cruz County. The Bank operates five full-service banking offices and two self-serve banking centers, all of which have received a Green Business Certification Award by the Monterey Bay Area Green Business Program. The Bank's full-service banking offices are located in Aptos, Capitola, Santa Cruz, Scotts Valley and Watsonville. The Bank commenced operations on February 3, 2004 in Santa Cruz.

Santa Cruz County Bank's common stock is listed on the Over the Counter (OTC) Bulletin Board under the stock symbol SCZC. More information on the Bank may be obtained through its website: www.sccountybank.com or by calling 831.457.5000.

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 fluctuations in interest rates, inflation, government regulations and general economic conditions, and competition within the business areas in which the Bank is conducting its operations, including the real estate market in California and other factors beyond the Bank'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 Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

SOURCE Santa Cruz County Bank