HNB Herald National Bank Common Stock

Herald National Bank (NYSE AMEX: HNB), a New York-based full-service commercial bank, announced today financial results for the second quarter of 2009, the bank's second full quarter of operations since opening in November 2008. As of June 30, 2009, the bank reported a total of $261 million in assets and $216 million in deposits.

Loan originations of $56 million drove asset growth during the quarter, with loan totals increasing from $43 million to $99 million, or 130%. The bank’s assets also increased from $160 million to $261 million, or 63%, while deposits increased 89% during the quarter, from $114 million to $216 million, of which 90% are considered core deposits.

In addition, Herald National Bank also announced that the bank’s Tier 1 capital ratios currently stand at 16.9%, well in excess of the 5% benchmark necessary to be designated a "well capitalized" institution by the FDIC. Net loss for the quarter totaled $7 million, a 9% improvement from the previous quarter, which was in line with the new bank’s business plan.

According to data provided by SNL Financial, the bank's asset growth by percentage was the fastest during the second quarter (Q2 vs. Q1 2009) among all commercial banks headquartered in the New York Metropolitan Statistical Area (MSA) that have reported to date. This marks the second straight quarter that Herald National Bank has held that position in the NY Metropolitan Statistical Area (MSA). Nationally, Herald ranked number three in percentage asset growth for the period and first in year to date percentage asset growth among all “de novo” banks formed from 2006 through year end 2008.

"Our rapid growth is a clear indication that businesses in the New York metropolitan area have embraced Herald National Bank as a valued business partner," said David S. Bagatelle, Herald National Bank's President and Chief Executive Officer. "We are actively lending and supporting our clients' businesses through one-on-one dedicated service across all product lines, from business cash management to personal financial solutions," he added.

About Herald National Bank

Herald National Bank is a relationship-based banking institution dedicated to serving the commercial and private banking needs of small to mid-size businesses, their owners, executives and senior managers, as well as high net worth individuals in the New York metropolitan area. Herald National Bank presently has three offices located in Manhattan (623 Fifth Avenue), Brooklyn (1333 60th Street), and Melville, Long Island (58 South Service Road).

For more information, visit www.heraldnb.com.

Forward Looking Statements Disclaimer

Certain matters in this press release constitute forward-looking statements that involve assumptions and potential risks and uncertainties, which are made in a manner consistent with the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance and achievements of Herald National Bank to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. These factors include: general economic, capital market and business conditions; risks arising from litigation or similar proceedings; interest rate fluctuations; levels of delinquent loans; employee turnover; government regulation; and those other factors discussed in the filings of Herald National Bank with the Office of the Comptroller of the Currency. Herald National Bank undertakes no obligation, and expressly disclaims any obligation, to update publicly or revise any forward looking statement, which speaks only as of the date it is made, whether as a result of new information, future events or otherwise.

Herald National Bank

Financial Highlights

(unaudited)

(dollars in thousands, except per share data)

    Three months ended Six months ended June 30, June 30, Statement of Operations (1)   2009       2008     2009       2008   Interest income $ 1,505 $ 37 $ 2,074 $ 42 Interest expense   672     -     952     -   Net interest income 833 37 1,122 42 Provision for loan losses 633 - 987 - Noninterest income 71 - 92 1,059 Noninterest expense, net   7,278     1,573     14,969     1,059   Pretax income (7,007 ) (1,536 ) (14,742 ) (1,017 ) Tax expense   4     38     8     25   Net income $ (7,011 ) $ (1,574 ) $ (14,750 ) $ (1,042 )   (1) During the three and six month periods ending June 30, 2008, the Bank was a development stage corporation and the Bank was in formation.   Basic earnings per share $ (1.13 ) n/a $ (2.38 ) n/a Weighted average shares - basic 6,201 n/a 6,201 n/a Selected Balance Sheet         Data at End of Period   6/30/2009     3/31/2009     12/31/2008   Total loans $ 98,876 $ 42,927 $ 10,249 Allowance for loan losses 1,092 459 105 Securities available for sale 90,042 70,714 28,885 Securities held to maturity 30,713 - - Total assets 261,475 160,097 74,817 Total deposits 216,147 114,686 22,069 Stockholders' equity 36,176 42,998 50,430   Capital Ratios Equity to Assets 13.84 % 26.86 % 67.40 % Tier 1 Leverage Ratio 16.90 % 37.73 % 189.75 % Tier 1 Risk-based Capital Ratio 24.34 % 53.00 % 139.24 % Total Risk-based Capital Ratio 25.07 % 53.56 % 139.53 %