PBNK Pinnacle Bank (QB)

PBNK.OB - Pinnacle Bank, headquartered in Gilroy, California, announced today net income for the second quarter of 2013 of $145,000 compared to $267,000 in the comparable quarter of 2012. The Q2 2013 provision for loan losses was $79,000 while there was no provision in Q2 2012.

As of June 30, 2013, total assets were $177.5 million, an 11% increase from the $160.0 million at June 30, 2012.

Loans were $135.4 million at June 30, 2013, an increase of $10.9 million (9%) from the June 30, 2012, balance of $124.5 million.

Non-interest bearing deposits at June 30, 2013, increased 50% to $57.6 million from $38.5 million at June 30, 2012. Total deposits at June 30, 2013, were $159.6 million compared to $141.8 million at June 30, 2012, a 13% increase.

“Our local markets saw continued but uneven economic improvements in the second quarter of 2013. We see opportunities for organic growth in our balance sheet. These opportunities include high quality loan demand and core deposits,” stated Susan K. Black, President and CEO. “The 50% year-over-year growth in non-interest bearing deposits highlights the core business banking relationships we have added in the last year,” added Ms. Black. “Our new Salinas location which opened in the second quarter enhances our visibility and reinforces our commitment to Monterey County. While the environment for community banks remains challenging, we are building a solid franchise and remain optimistic about future opportunities.”

The bank’s capital position remains above regulatory guidelines for well capitalized banks. At June 30, 2013, the Bank had a total risk based capital ratio of 11.65%.

For more information please go to www.pinnaclebankonline.com click on Investor Relations and June 2013 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 small to medium-sized businesses, 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 2013 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) 6/30/2013 3/31/2013 6/30/2012 $   % Total assets $ 177,478 $ 175,150 $ 160,024 $ 17,454 11 % Gross loans $ 135,370 $ 136,879 $ 124,480 $ 10,890 9 % Allowance for loan losses $ (2,873 ) $ (2,677 ) $ (2,765 ) $ 108 4 % Deposits: Non-interest bearing $ 57,571 $ 46,258 $ 38,457 $ 19,115 50 % Interest-bearing $ 101,996 $ 111,062 $ 103,379 $ (1,383 ) -1 % Total deposits $ 159,567 $ 157,320 $ 141,836 $ 17,732 13 % Shareholders' equity $ 16,772 $ 16,743 $ 16,989 $ (217 ) -1 %   Summary Income Statement         (Unaudited, dollars in thousands Quarter ended Quarter ended Quarter ended except per share data) 6/30/2013 3/31/2013 6/30/2012 Interest income $ 1,799 $ 1,833 $ 1,834 Interest expense 84 93 128 Net interest income 1,715 1,740 1,705 Provision for loan losses 79 94 0 Non-interest income 226 172 134 Non-interest expense 1,717 1,709 1,572 Income tax expense 0 0 0 Net income $ 145 $ 109 $ 267   Earnings per share $ 0.04 $ 0.03 $ 0.08 Net interest margin 4.42 % 4.54 % 4.69 %                   Minimum required to be Capital Ratios 6/30/2013     3/31/2013     6/30/2012     well-capitalized Tier 1 leverage ratio 9.87% 9.89% 10.64% 5.00% Tier 1 risk-based capital ratio 10.39% 10.32% 11.52% 6.00% Total risk-based capital ratio 11.65% 11.58% 12.78% 10.00%

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