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Royal American Bank

Inverness, IL · Cert 33370

FDIC

Q2 2006

$556.4MAssets
$500.6MLoans
$468.0MDeposits
$51.0MEquity
Loan mix
34%RE $79.3M66%C&I $156.4M0%Consumer $0.1MQ2 2005Q2 2006
Deposit mix
73%Interest-bearing $342.4M27%Noninterest $125.6MQ2 2005Q2 2006

NIM

4.77%Q2 ’045.83%Q2 ’056.85%Q2 ’06+5%+6%

Non-interest income vs. expense

2.84%Q2 ’042.78%Q2 ’052.19%Q2 ’06-4%-22%

Executive Summary

  • Earnings: ROA of 1.43%, up 22 bps year over year; NIM at 4.35%.
  • Asset quality: problem loans at 0.00% of loans (0 bps YoY), with net charge-offs at 0.01%.
  • Funding: loans stand at 106.97% of deposits as of Q2 2006.

Financial Results

Return on Assets (quarter, annualized)

1.43%+22 bps YoY

Net Interest Margin (quarter, annualized)

4.35%+25 bps YoY

Efficiency Ratio (quarter, annualized)

43.87%-1,308 bps YoY

Tier 1 Leverage Ratio

n/a

Discrete quarter, annualized.

MetricQ2 2005Q3 2005Q4 2005Q1 2006Q2 2006YoY ΔTrend
Earnings
Return on Assets1.21%1.19%1.13%1.23%1.43%+22 bps
Return on Equity13.54%13.38%12.81%13.61%15.47%+193 bps
Net Interest Margin4.09%3.99%4.09%4.15%4.35%+25 bps
Efficiency Ratio56.95%55.22%59.05%55.71%43.87%-1,308 bps
Non-Interest Burden2.00%1.91%2.16%2.04%1.55%-45 bps
Growth
Asset Growth (YoY)27.32%25.99%28.42%17.77%17.65%-967 bps
Loan Growth (YoY)34.46%28.42%19.33%12.29%23.28%-1,118 bps
Deposit Growth (YoY)26.15%24.37%29.76%23.14%12.44%-1,370 bps
Asset Quality
Nonperforming Loans / Loans0.00%0.00%0.00%0.00%0.00%0 bps
Net Charge-Offs / Loans0.00%0.00%0.04%-0.01%0.01%+1 bps
Allowance / Loans1.14%1.09%1.14%1.17%1.07%-7 bps
Allowance Coverage of NPLsn/an/an/an/an/an/an/a
Capital
Tier 1 Leverage Ration/an/an/an/an/an/an/a
Total Risk-Based Capital10.54%10.55%10.79%11.11%10.28%-26 bps
Equity / Assets8.94%8.92%8.79%9.28%9.17%+23 bps
Liquidity & Funding
Loans / Deposits97.57%98.65%92.85%96.16%106.97%+940 bps
Liquid Assets / Assets0.06%0.14%0.07%0.04%0.01%-5 bps
CRE / Total Capitaln/an/an/an/an/an/an/a