Santa Cruz County Bank Reports Unaudited Results for the First Quarter Ended March 31, 2012

Bank reports double digit percentage year to year increases in assets, loans, deposits and net income

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Apr 17, 2012, 05:26 ET

SANTA CRUZ, Calif., April 17, 2012 /PRNewswire/ -- Santa Cruz County Bank, (SCZC.OB), a locally owned and operated full-service community bank headquartered in Santa Cruz County, today announced earnings for the first quarter ended March 31, 2012. For the three month period ended March 31, 2012, the bank reported a 26% increase in net income after tax to $573,485 compared to $453,538 for the same period ended March 31, 2011. Pretax income increased by $184,286, 25%, to $911,607 comparing March 31, 2012 to March 31, 2011. For the same period, net interest income improved by $229 thousand, 8%, over the prior year to $3.2 million.

David Heald, President and CEO commented; "Our strong year over year growth demonstrates the focus and commitment of our Board and Management team to enhance shareholder value and the community's support of our customer service, delivery systems and products. Our business strategy will continue to focus on the needs of the community we serve. Once again we are honored to be recognized by the Findley Reports as a Super Premier Performing Bank for a second consecutive year."

Shareholders' equity for the period ended March 31, 2012 increased by $2.8 million, 12%, over the prior period ended March 31, 2011. Basic earnings per share increased to $0.30 for the quarter ended March 31, 2012 as compared to $0.24 for the quarter ended March 31, 2011.

FIRST QUARTER: MARCH 31, 2012 COMPARED TO DECEMBER 31, 2011
Total deposits increased $7.1 million, 2% to $295.3 million
Gross loans increased $8.5 million, 4% to $199.8 million
Total assets increased $5.5 million, 2% to $325.7 million
Net income decreased $101 thousand, -15% to $573 thousand

YEAR TO YEAR: MARCH 31, 2012 COMPARED TO MARCH 31, 2011
Total deposits increased $43.2 million, 17% to $295.3million
Gross loans increased $32.8 million, 20% to $199.8 million
Total assets increased $45.6 million, 16% to $325.7 million
Net income increased $120 thousand, 26% to $573 thousand
Non-interest bearing deposits represented 37% of total deposits as of March 31, 2012.

FIRST QUARTER HIGHLIGHTS:
Santa Cruz County Bank was designated as a Super Premier Performing Bank by The Findley Reports for its 2011 performance.

Santa Cruz County Bank received a 4-Star "Excellent" rating from Bauer Financial Reports, Inc. for its fourth quarter 2011 performance.

Harvey Nickelson was appointed to the Santa Cruz County Bank Board of Directors to replace outgoing Director Steve John.

Loans grew by $8.5 million in the first quarter on $18.2 million in new production and $32.8 million year over year through the focused efforts of our Relationship Officers.

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. 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.

Selected Financial Data (unaudited)
March 31, 2012

			Change			Change
	Quarter ended 3/31/12	Quarter ended 12/31/11	$	%	Quarter ended 3/31/11	$	%

Balance Sheet

Total assets	$325,677,638	$320,165,655	$5,511,983	2%	$280,088,758	$45,588,880	16%
Gross loans	199,839,134	191,369,556	8,469,578	4%	167,010,330	32,828,804	20%
Allowance for loan losses	4,411,570	4,305,290	106,280	2%	3,581,729	829,841	23%
Non interest-bearing deposits	109,706,475	113,014,682	(3,308,207)	-3%	89,057,968	20,648,507	23%
Total deposits	295,348,484	288,206,914	7,141,570	2%	252,172,712	43,175,772	17%
Shareholders' equity	26,968,401	26,285,045	683,356	3%	24,176,792	2,791,609	12%

Income Statement

Interest income	3,367,116	3,151,070	216,046	7%	$ 3,172,337	194,779	6%
Interest expense	120,896	129,697	(8,801)	-7%	154,686	(33,790)	-22%
Net interest income	3,246,220	3,021,373	224,847	7%	3,017,651	228,569	8%

Provision for loan losses	300,000	300,000	-	0%	582,500	(282,500)	-48%
Non-interest income	526,869	838,435	(311,566)	-37%	882,225	(355,356)	-40%
Non-interest expense	2,561,482	2,446,035	115,447	5%	2,590,055	(28,573)	-1%
Net income before taxes	911,607	1,113,773	(202,166)	-18%	727,321	184,286	25%
Income tax expense	338,122	439,688	(101,566)	-23%	273,783	64,339	23%
Net income after taxes	$ 573,485	$ 674,085	(100,600)	-15%	$ 453,538	119,947	26%

BASIC EARNINGS PER SHARE	$ 0.30	$ 0.35			$ 0.24
BOOK VALUE PER SHARE	$ 14.02	$ 13.67			$ 12.67

Ratios
Net interest margin	4.29%	4.01%			4.65%
Equity capital-to-total assets	8.3%	8.2%			8.6%