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Service 1st Bank

Stockton, CA · Cert 35215

FDIC

Q3 2008

$231.1MAssets
$130.7MLoans
$197.1MDeposits
$18.4MEquity
Loan mix
70%RE $61.0M30%C&I $25.7M0%Consumer $0.3MQ3 2007Q3 2008
Deposit mix
87%Interest-bearing $170.5M13%Noninterest $26.6MQ3 2007Q3 2008

NIM

6.86%Q3 ’066.89%Q3 ’075.71%Q3 ’08-8%+15%

Non-interest income vs. expense

2.86%Q3 ’062.42%Q3 ’072.31%Q3 ’08-14%-3%

Executive Summary

  • Earnings: ROA of -1.71%, down 249 bps year over year; NIM at 3.77%.
  • Asset quality: problem loans at 0.00% of loans (0 bps YoY), with net charge-offs at 2.93%.
  • Funding: loans stand at 66.31% of deposits as of Q3 2008.

Financial Results

Return on Assets (quarter, annualized)

-1.71%-249 bps YoY

Net Interest Margin (quarter, annualized)

3.77%+48 bps YoY

Efficiency Ratio (quarter, annualized)

58.16%-1,015 bps YoY

Tier 1 Leverage Ratio

n/a

Discrete quarter, annualized.

MetricQ3 2007Q4 2007Q1 2008Q2 2008Q3 2008YoY ΔTrend
Earnings
Return on Assets0.78%-0.08%0.55%0.90%-1.71%-249 bps
Return on Equity8.77%-0.95%6.22%10.35%-20.41%-2,917 bps
Net Interest Margin3.29%3.03%3.30%3.22%3.77%+48 bps
Efficiency Ratio68.31%77.78%64.83%58.99%58.16%-1,015 bps
Non-Interest Burden2.17%2.31%2.07%1.64%2.11%-6 bps
Growth
Asset Growth (YoY)8.08%1.47%15.17%7.99%-0.77%-885 bps
Loan Growth (YoY)11.13%-0.18%11.83%7.52%5.84%-529 bps
Deposit Growth (YoY)10.35%1.22%16.65%8.77%-4.13%-1,448 bps
Asset Quality
Nonperforming Loans / Loans0.00%0.00%0.00%0.00%0.00%0 bps
Net Charge-Offs / Loans0.00%2.81%0.00%0.64%2.93%+293 bps
Allowance / Loans1.25%1.36%1.45%1.60%1.72%+47 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 Capital12.95%13.47%12.31%13.10%12.68%-28 bps
Equity / Assets8.77%9.05%8.60%8.77%7.96%-82 bps
Liquidity & Funding
Loans / Deposits60.06%56.67%59.60%61.39%66.31%+625 bps
Liquid Assets / Assets5.95%5.89%7.04%7.64%7.65%+171 bps
CRE / Total Capitaln/an/an/an/an/an/an/a