ICB Financial First Quarter 2011 Financial Performance

ONTARIO, Calif., April 25, 2011 /PRNewswire/ -- ICB Financial (OTC Bulletin Board: ICBN)

Letter to Our Customers and Shareholders

Although the business climate in the Inland Empire is showing signs of improving, community banking in the area is still recovering slowly from the business downturn that began in 2007. ICB Financial (ICBF) and its subsidiary, Inland Community Bank, N.A. (ICB), have started off the first quarter of 2011 with a focus on consolidation, strategic retrenchment, and emphasis on the sound business principles that have been the foundation of our success during the past 21 years.

While first quarter results reflect both a slow economic recovery and our diligent loan portfolio management to control asset quality, we remain competitive and driven to develop new business based on prudent and responsible lending practices. In an economy where interest rates have continued to drop, ICB's yield on earning assets is still a healthy 4.95% and is beginning to show signs of improving. Our cost of funds has also remained low at well under 1.0%, due in part to an increase in noninterest-bearing deposits of 5.5%. Total deposits, however, fell 10.8% due in part to a drop in high rate brokered funds that matured and were not renewed during the first quarter of 2011.

Although non-performing assets have increased slightly, we plan to continue to reduce problem assets as the year progresses. Meanwhile, the provision for loan losses has not only held stable but has dropped compared to the first quarter of 2010 due to the hard work of our loan administration department and its special assets group. Our dedicated team of loan professionals also helped ICB achieve an almost 50% reduction in other real estate owned (OREO) since March 2010.

The loan loss reserve now stands at 2.61% of total loans and we are committed to maintaining the reserve at a level that we consider adequate to absorb any further potential losses in our loan portfolio. We continue to emphasize a strong governance and risk framework for disciplined risk management of our loan exposures as we continue to make ongoing progress in our credit risk exposure.

Management remains diligent in controlling non-interest expenses and even with FDIC insurance expense of just over $400M per year and the amortization of a core deposit intangible of over $450M per year, we were able to show a decrease in non-interest expense for the quarter. We will continue to monitor these expenses and work toward further reductions for the remainder of the year.

ICB is situated in one of the most economically hard hit, yet vibrant economic landscapes in California, positioned on the major shipping line from the Ports of Los Angeles and Long Beach. As business increases at these hubs, the opportunities to provide financial services for the businesses facilitating the movement of goods and the necessary services will also grow, and we expect to increase our market share from these businesses.  

Our conservative approach to capital and liquidity, as well as maintaining ample loan loss reserves, places ICB in a position to pursue opportunities for growth in earnings and loans as the economy improves.

We remain committed to creating long-term value for the ICB franchise and to serving as a valuable and trusted financial resource for the business community in the Inland Empire. As always, we deeply appreciate the dedication of our employees and recognize the valuable and ongoing support of our customers and shareholders.

James S. Cooper  

President and Chief Executive Officer

Financial Performance benchmarks for the quarter ended March 31, 2011 include:

• Total loans including Available for Sale were $162.7 million in 2011, down 12% compared to $185.4 million for the same period in 2010.
• Non-interest bearing deposits were up were up 5.5% or $3.4 million while total deposits in 2011 were down 10.8% or $26.9 million compared to the same period in 2010. (The drop in total deposits was due in part to a run-off of brokered funds that were not replaced, and our continuing effort to rebalance the deposit portfolio.)
• The Efficiency ratio for the first quarter of 2011 was 86.1% compared to 76.4% in the first quarter of 2010. This increase was due in part to an increased core deposit intangible amortization over $100M in the first three months of 2011.
• Non-performing assets increased to 5.03% of total assets at March 31, 2011 compared to 3.35% at March 31, 2010.
• Provision for loan and lease losses was reduced to $150,000 for the first quarter of 2011 compared to $263,000 for the first quarter of 2010.
• Net earnings per common share for 2011 were $0.01 compared to net earnings of $0.04 in the same quarter of 2010.
• Gross interest revenue of $2.9 million for 2011 was down from $3.3 million in 2010, a decrease of 13.2%.
• Tangible book value per share increased from $4.78 in the first quarter of 2010 to $4.83 in the first quarter of 2011, an increase of 1.0%.
• Total Risk-based capital ratio at March 31, 2011 is 18.75%, compared to 15.25% at year-end 2010 (the minimum well-capitalized designated ratio under regulatory guidelines is 10.00%).

Forward-looking statements

Certain statements in this press release constitute forward-looking statements that are based upon current management expectations and, therefore, are subject to certain risks and uncertainties that could cause actual results, performance, or achievements to differ materially from those expressed, suggested, or implied. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. Often, they include the words "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may."  Forward-looking statements are effective only as of the date that they are made, and ICB Financial assumes no obligation to update this information to reflect occurrences or unanticipated events or circumstances after the date of such statements.

Contact:
Mr. James S. Cooper
President and CEO
ICB Financial
3999 Inland Empire Blvd.
Ontario, CA
91764
909-481-8706, Ext. 280

SOURCE ICB Financial