PBNK Pinnacle Bank (QB)

PBNK - Pinnacle Bank, headquartered in Gilroy, California, announced today unaudited net income for the three months ended June 30, 2014 of $236,000 compared to $145,000 in the same period of 2013.

As of June 30, 2014, total assets were $212.1 million, a 20% increase from the $177.5 million at June 30, 2013.

Loans were $153.3 million at June 30, 2014, an increase of $17.9 million (13%) from the June 30, 2013 balance of $135.4 million. The allowance for loan losses at June 30, 2014 was $3.5 million or 2.26% of loans compared to $2.9 million or 2.12% of loans at June 30, 2013. Nonperforming assets were $3.0 million (1.39% of assets) at June 30, 2014 compared to $3.5 million (1.98% of assets) a year earlier.

Non-interest bearing deposits at June 30, 2014, increased 26% to $72.5 million from $57.6 million at June 30, 2013. Total deposits at June 30, 2014, were $187.3 million compared to $159.6 million at June 30, 2013, a 17% increase.

“We are very pleased to report strong second quarter 2014 performance with quality growth in our loan and deposit portfolios and increased non-interest income,” stated Susan K. Black, President and CEO. “We continue to build the Bank by growing core relationships as evidenced by the 26% year-over-year growth in non-interest bearing deposits. More and more businesses and professionals in Santa Clara, Monterey and San Benito counties are choosing to work with our team of professional bankers and are enjoying the Pinnacle brand of community banking,” she added. “We remain optimistic about the potential for further organic growth as we build franchise value in our local markets.”

The bank’s capital position remains above regulatory guidelines for well capitalized banks. At June 30, 2014, the Bank had a total risk based capital ratio of 11.41%. Book value per share at June 30, 2014 was $7.12. Net interest margin in the second quarter of 2014 was 4.20%.

For more information please go to www.pinnaclebankonline.com click on Investor Relations and June 2014 call report.

About Pinnacle Bank

Pinnacle Bank is a full-service business bank dedicated to providing quality depository and credit services in Santa Clara, San Benito and Monterey counties. The bank focuses on commercial banking services for businesses and nonprofit organizations, offering a variety of products and services that combine the best of personal touch with convenient technology-based delivery. Pinnacle Bank has locations in Morgan Hill, Gilroy and Salinas. For more information please go to www.pinnaclebankonline.com click on Investor Relations and June 2014 call report.

Forward-Looking Statements

This release may contain forward-looking statements, such as, among others, statements about plans, expectations and goals concerning growth and improvement. Forward-looking statements 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, including the real estate market in our primary service area and more generally 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. Pinnacle Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

        Summary Balance Sheet Year over year change (Unaudited, dollars in thousands)   6/30/2014       3/31/2014       6/30/2013       $     %   Total assets $ 212,121 $ 205,988 $ 177,478 $ 34,643   20 % Gross loans $ 153,279 $ 148,811 $ 135,370 $ 17,909 13 % Allowance for loan losses $ (3,465 ) $ (3,433 ) $ (2,873 ) $ (592 ) 21 % Non-interest bearing deposits $ 72,532 $ 66,746 $ 57,571 $ 14,961 26 % Interest-bearing deposits $ 114,742 $ 115,326 $ 101,996 $ 12,746 12 % Total deposits $ 187,275 $ 182,072 $ 159,567 $ 27,708 17 % Shareholders' equity $ 23,451 $ 23,174 $ 16,772 $ 6,679 40 %   Summary Income Statement           (Unaudited, dollars in thousands Quarter ended Quarter ended Change Quarter ended Change except per share data)   6/30/2014     3/31/2014   %     6/30/2013   % Interest income $ 1,997 $ 2,160 -8 % $ 1,799 11 % Interest expense   78     75 4 %   84 -7 % Net interest income 1,919 2,085 -8 % 1,715 12 % Provision for loan losses 0 0 0 % 79 -100 % Non-interest income 338 219 54 % 226 50 % Non-interest expense 1,860 2,029 -8 % 1,717 8 % Income tax expense   161     116 39 %   0 0 % Net income $ 236   $ 160 48 % $ 145 63 %   Earnings per share $ 0.07 $ 0.05 48 % $ 0.04 63 % Book value per share $ 7.12 $ 7.04 $ 5.09           Minimum required to be Capital Ratios 6/30/2014   3/31/2014   6/30/2013   well-capitalized Tier 1 leverage ratio 9.28 % 9.40 % 9.87 % 5.00 % Tier 1 risk-based capital ratio 10.15 % 10.06 % 10.39 % 6.00 % Total risk-based capital ratio 11.41 % 11.32 % 11.65 % 10.00 %   Nonperforming assets   6/30/2014   3/31/2014   6/30/2013 Nonperforming assets $ 2,956   $ 2,738   $ 3,517 Nonperforming assets to total assets 1.39 % 1.33 % 1.98 % Allowance for loan losses to nonperforming loans 216 % 247 % 173 %

Pinnacle BankSusan K. Black, 408-762-7140President & CEO