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American Riviera Bank Posts $3.4 Million in Net Income for 2011

The bank also sees big increases in deposits and loans compared with a year ago

American Riviera Bank reported Wednesday unaudited net income of $3,404,000 ($1.35 per share) for the year
ended Dec. 31, 2011, compared with $1,024,000 (41 cents per share) for the year ended Dec. 31, 2010.

The 2011 net income includes recognition of $2,481,000 in federal and state tax benefits made possible by reversal of a valuation allowance on deferred tax assets.

American Riviera Bank focuses on providing relationship banking services delivered through knowledgeable bankers and innovative technology. This combination of service and technology has resulted in significant growth in customers and relationships. In 2011, the bank opened almost 500 new checking, savings and money market accounts.

Non-interest bearing demand deposits grew 46 percent compared with one year ago, reaching $23 million, or 20 percent of total deposits as of Dec. 31, 2011. Loans outstanding increased 15 percent compared with one year ago, reaching $108 million at Dec. 31, 2011.

The bank was able to grow deposits and loans without sacrificing net interest margin. Net interest margin was 4.87 percent for the year ended Dec. 31, 2011, up slightly from 4.75 percent for the same period last year.

“Despite the challenging economy, our bank was able to report another profitable year and grow loans within our community due to our strong capital position and expanding deposit base,” President/CEO Jeff DeVine said. “We are thankful for the trust of our clients, and look forward to continuing to serve their needs in 2012.”

As a result of residential real estate market deterioration in the latter half of 2011, the bank absorbed $1.4 million in loan charge-offs during 2011, compared with $54,000 in 2010. The bank recorded $810,000 in loan loss provision for the year ended Dec. 31, 2011, compared with $648,000 for the year ended Dec. 31, 2010.

As a result of focused efforts, loan quality was improved during the year and the bank reported no nonaccrual or past due loans at Dec. 31, 2011. Management and the Board of Directors believe that the allowance for loan losses at 2.35 percent of total loans is adequate at Dec. 31, 2011.

The bank has $142 million in total assets, and maintains a strong capital position with Tier 1 Capital to total average assets of almost 15 percent as of Dec. 31, 2011 — well above the regulatory guideline of 5 percent for well-capitalized institutions. Book value and tangible book value of one share of American Riviera Bank stock is $8.88 at Dec. 31, 2011, an increase from $7.48 at Dec. 31, 2010.

— Michelle Martinich is senior vice president and chief financial officer for American Riviera Bank.

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