California Business Bank Announces First Quarter 2009 Results

California Business Bank (OTCBB:CABB) announces financial results today for the first quarter ended, March 31, 2009. The Bank reported an After Tax Loss of ($172,000) or 9 cents per share for the quarter, and the diluted book balance per share was $8.11. We have noted in the first quarter an improvement to our Net Interest Margin by 30 basis points resulting from improved pricing, and decreasing our funding cost. The bank is forecasting further improvement to our Net Interest Margin throughout this fiscal year.

The bank took proactive action in the fourth quarter of 2008 to increase the provision to Allowance for Loan Lease Loss (ALLL) to $2.035MM, or 2.45% of loans outstanding, and the establishment of an OREO reserve, equating to 20% of our OREO balance. Mr. Charles Wood, president and CEO, stated, �Management took these measures because of extraordinary economic conditions the financial system experienced in 2008 where several financial icons collapsed. This has affected the core of our financial system and caused both the United States Treasury and Federal Reserve System to adopt numerous programs to assist with the stabilization of the financial system. According to various economists, we expect see signs of improvement within the economy sometime in the 2nd to 3rd quarter of 2009.�

California Business Bank is a participant in the FDIC Temporary Liquidity Guarantee Program (TLGP) which insures all non-interest deposits up to 100% of the funds on deposit, and the increased FDIC insurance limits to $250,000 per depositor. The bank is committed to maintain strong capital and will participate in prudent programs to protect our depositor funds.

Significant indicators for the first quarter ended March, 31, 2009 include:

Total Assets increased by 13% to $120MM compared to $106.7MM as of December, 31, 2008;
Loans outstanding increased by 4% to $88.2MM, mainly in the commercial and industrial areas;
Total Deposits increased by 18% to $100MM at quarter end along with increase in our Demand Deposits by 10% to $20.1MM or 20% of total deposits;
The Loan-to-Deposit ratio improved to 88%, and the bank has $9.0 MM in fed fund facilities available, plus $10.0 MM in borrowing capacity at the Federal Home Loan Bank;
The ALLL remained unchanged at $2.035MM, and decreased to 2.3% of loans outstanding, (and when cash secured loans are not considered, the ratio increases to 2.6%);
The bank continues to be categorized as �well-capitalized� under regulatory guidelines; Tier 1 leverage capital ratio of 12.84%; Tier 1 risk-based capital ratio of 16.21%; and, Total risk-based capital ratio of 17.48%.
Bank Stock has been trading over the past 52 weeks between $10.40 & $6.10 per share, compared to our book value of $8.11 per share. The 1st quarter volume was approximately 16M shares.

California Business Bank offers a wide range of financial services to individuals, small and medium size businesses in Los Angeles, and the surrounding communities in Southern California. Our commitment is to deliver the highest quality financial services and products. We have added mobile banking and on-line account origination. Please visit our web-page to open-up your personal account on line, or add mobile banking to your existing personal or business accounts.

CALIFORNIA BUSINESS BANK IS IN THE BUSINESS OF MAKING LOANS AND ESTABLISHING BANK RELATIONSHIPS! IT�S THAT SIMPLE!

Forward Looking Statements

Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and are subject to the safe harbors created by the act. These forward-looking statements refer to the Company�s current expectations regarding future operating results, and growth in loans, deposits, and assets. These forward looking statements are subject to certain risks and uncertainties that could cause the actual results, performance, or achievements to differ materially from those expressed, suggested, or implied by the forward looking statements. These risks and uncertainties include, but are not limited to (1) the impact of changes in interest rates, a decline in economic conditions, and increased competition by financial service providers on the Company�s results of operation, (2) the Company�s ability to continue its internal growth rate, (3) the Company�s ability to build net interest spread, (4) the quality of the Company�s earning assets, and (5) governmental regulations.

California Business Bank (CE) (USOTC:CABB)
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