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American Riviera Bank Reports over $600 Million in Assets

American Riviera Bank (OTC Markets: ARBV) announced today record unaudited net income of $5,890,000 ($1.32 per share) for the year ended December 31, 2018. This represents a 67% increase in net income from the $3,536,000 ($0.80 per share) for the same reporting period in the prior year. The annualized return on average assets of 1.03% and return on average equity of 10.19% represent an increase from the 0.73% and 6.61%, respectively, achieved for the same reporting period in the prior year. For the fourth quarter ended December 31, 2018, the Bank reported unaudited net income of $1,492,000 ($0.33 per share) compared to $35,000 ($0.01 per share) for the fourth quarter last year.

Prior year results were negatively impacted by a non-recurring $1,119,000 revaluation of deferred tax assets in the fourth quarter ended December 31, 2017 related to enacted federal tax reform. In 2018 the Bank benefited from the lower federal income tax rate associated with such reform, and reinvested by hiring 18 new employees and continued our expansion into San Luis Obispo County.

The Bank’s continued organic growth in Santa Barbara County and the opening of our full-service Paso Robles branch resulted in a 20% increase in total assets, with $616 million in total assets reported at December 31, 2018. Asset growth was driven by strong loan demand, with total loans increasing $94 million or 23% from December 31, 2017, reaching $508 million at December 31, 2018 with no loans that were 90 days or more past due and no other real estate owned. The Bank reported an annualized net interest margin of 4.51% for the year ended December 31, 2018.

As of December 31, 2018, the Bank reported $513 million in total deposits. This represents a $65 million or 14% increase from the same reporting period in the prior year. Checking accounts, comprised of non-interest bearing demand deposits and interest bearing NOW accounts, increased by $17 million or 8% from the same reporting period last year.

Jeff DeVine, President and Chief Executive Officer, stated, 2018 was an exciting year of growth for American Riviera Bank with assets increasing just over $100 million. Our bankers are creating lasting relationships with clients in our Central Coast communities by serving their deposit and credit needs. As a result, the Bank continues to grow our client base, asset size and earnings. We are looking forward to further expansion in 2019 with a full-service branch in the City of San Luis Obispo.”

As of December 31, 2018, American Riviera Bank maintained a strong capital position with a Tier 1 Capital Ratio of 10%; well above the regulatory guideline of 8% for well capitalized institutions. The tangible book value per share of American Riviera Bank common stock is $12.51 at December 31, 2018, a 12% increase from $11.16 at December 31, 2017.

Company Profile

American Riviera Bank is a full-service community bank focused on serving the lending and deposit needs of businesses and consumers on the Central Coast of California. The state-chartered bank opened for business on July 18, 2006, with the support of local shareholders. Full-service branches are located at 1033 Anacapa Street in Santa Barbara, 525 San Ysidro Road in Montecito, 5880 Calle Real in Goleta and 1601 Spring Street in Paso Robles. Commercial lending offices are located at 30 East Figueroa Street in Santa Barbara and 1085 Higuera Street in San Luis Obispo. Our residential loan production office is located at 18 East Figueroa Street in Santa Barbara. For eight consecutive years the Bank has been recognized for strong financial performance by the Findley Reports, and received the highest “Super Premier” rating from Findley for 2017. As of September 30, 2018, the Bank was rated five stars by BauerFinancial.

Statements concerning future performance, developments or events concerning expectations for growth and market forecasts, and any other guidance on future periods, constitute forward looking statements that are subject to a number of risks and uncertainties. Actual results may differ materially from stated expectations. Specific factors include, but are not limited to, effects of interest rate changes, ability to control costs and expenses, impact of consolidation in the banking industry, financial policies of the US government, and general economic conditions.

Balance Sheets (unaudited)
(dollars in thousands)
Dec 31,Dec 31,One Year
20182017Change
Assets
Cash & Due From Banks $ 41,271 $ 42,999 -4 %
Fed Funds Sold - 4,040 -100 %
Securities 46,010 33,534 37 %
Loans 508,397 414,165 23 %
Allowance For Loan Losses (5,542 ) (4,260 ) 30 %
Net Loans 502,855 409,905 23 %
Fixed Assets 5,299 3,903 36 %
Goodwill and Other Intangibles 5,516 5,695 -3 %
Other Assets 15,501 15,046 3 %
Total Assets 616,452 515,122 20 %
Liabilities & Shareholders' Equity
Demand Deposits 169,549 148,332 14 %
NOW Accounts 73,652 77,483 -5 %
Other Interest Bearing Deposits 270,106 222,941 21 %
Total Deposits 513,307 448,756 14 %
Borrowed Funds 40,000 10,000 300 %
Other Liabilities 2,258 1,681 34 %
Total Liabilities 555,565 460,437 21 %
Common Stock 46,477 45,895 1 %
Retained Earnings 14,831 8,915 66 %
Other Capital (421 ) (125 ) -237 %
Total Shareholders' Equity 60,887 54,685 11 %
Total Liabilities & Shareholders' Equity $ 616,452 $ 515,122 20 %
Book Value Per Share $ 13.74 $ 12.45 10 %
Tangible Book Value Per Share $ 12.51 $ 11.16 12 %
Statements of Income (unaudited)
(dollars in thousands)
Quarter Ended12 Months Ended
Dec 31,Dec 31,Dec 31,Dec 31,
20182017Change20182017Change
Interest Income
Interest and Fees on Loans $ 6,533 $ 5,272 24 % $ 23,827 $ 20,235 18 %
Net Fair Value Amortization Income 423 96 341 % 847 916 -8 %
Interest on Securities 297 120 148 % 999 265 277 %
Interest on Fed Funds 0 21 -100 % 12 100 -88 %
Interest on Due From Banks 165 132 25 % 601 450 34 %
Total Interest Income 7,418 5,641 32 % 26,286 21,966 20 %
Interest Expense
Interest Expense on Deposits 681 276 147 % 1,895 1,014 87 %
Interest Expense on Borrowings 73 1 7200 % 199 25 695 %
Total Interest Expense 754 277 172 % 2,094 1,039 101 %
Net Interest Income 6,664 5,364 24 % 24,192 20,927 16 %
Provision for Loan Losses 369 207 78 % 1,294 914 42 %
Net Interest Income After Provision 6,295 5,157 22 % 22,898 20,013 14 %
Non-Interest Income
Service Charges, Commissions and Fees 289 231 25 % 1,531 1,094 40 %
Other Non-Interest Income (53 ) 76 -170 % 205 316 -35 %
Total Non-Interest Income 236 307 -23 % 1,736 1,410 23 %
Non-Interest Expense
Salaries and Employee Benefits 2,633 2,186 20 % 9,694 8,066 20 %
Occupancy and Equipment 503 397 27 % 1,806 1,553 16 %
Other Non-Interest Expense 1,212 1,005 21 % 4,797 4,109 17 %
Total Non-Interest Expense 4,348 3,588 21 % 16,297 13,728 19 %
Net Income Before Provision for Taxes 2,183 1,876 16 % 8,337 7,695 8 %
Provision for Taxes 691 722 -4 % 2,447 3,040 -19 %
Non Recurring Tax Provision - 1,119 100 % - 1,119 100 %
Net Income $ 1,492 $ 35 4223 % $ 5,890 $ 3,536 67 %
Shares (end of period) 4,461,068 4,402,841 1 % 4,461,068 4,402,841 1 %
Earnings Per Share - Basic $ 0.33 $ 0.01 3259 % $ 1.32 $ 0.80 65 %
Return on Average Assets (annualized) 0.95 % 0.00 % 1.03 % 0.73 %
Return on Average Equity (annualized) 9.60 % 0.00 % 10.19 % 6.61 %
Net Interest Margin (annualized) 4.61 % 4.42 % 4.51 % 4.61 %

Contacts:

American Riviera Bank
www.americanrivierabank.com
805-965-5942
Michelle Martinich

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