TEMECULA, Calif., May 25, 2006 (PRIMEZONE) -- Mission Oaks Bancorp (OTCBB:MOKB) announced that it completed a private issuance of $7.5 million in trust preferred securities as part of a pooled securitization transaction with several other financial institutions.
Mission Oaks Bancorp, whose principal subsidiary is Temecula-based Mission Oaks National Bank, intends to use the net proceeds from the transaction for general corporate purposes, including support for continued growth of the bank.
The additional capital increases Mission Oaks' lending limit to $3.4 million and ensures it remains a well-capitalized institution as assets grow beyond $150 million.
"With this very cost-effective infusion of capital, the bank will be able to grow to well over $200 million in assets," said Gary Votapka, president and chief executive officer of the bank. "This is one of the reasons why we created a bank holding company last fall."
In September 2005, Mission Oaks created Mission Oaks Bancorp, a bank holding company that makes it easier to raise additional capital, repurchase stock, borrow money, acquire other banks and non-bank entities and issue stock.
With an effective after-tax cost of capital of less than 4 percent, the preferred trust transaction gives Mission Oaks access to inexpensive capital. Over the last five years Mission Oaks has raised more than $22.5 million to support its growth.
The trust preferred securities will bear interest at a fixed rate of 7.15 percent until June 15, 2011 and a floating interest rate thereafter of three-month LIBOR plus 1.65 percent. The floating interest rate resets quarterly once it commences in 2011. The securities will mature on June 15, 2036. The trust preferred securities were issued through a newly formed trust, Mission Oaks Statutory Trust I.
Mission Oaks National Bank is a federally chartered community bank that is committed to serving consumers and businesses in Southern California. The bank offers personalized services and products through three full-service branch offices in Temecula and Ontario and loan production offices in San Diego and Phoenix.
Mission Oaks Bancorp common stock is traded over the counter under the stock symbol MOKB.OB.
For more on Mission Oaks National Bank visit its Web site at missionoaksbank.com.
The Mission Oaks National logo is available at http://media.primezone.com/prs/single/?pkgid=471
Safe Harbor
Certain statements in this press release, including statements regarding the anticipated development and expansion of the Bank's business, and the intent, belief or current expectations of the Bank, its directors or its officers, are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995.) Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, risks related to the local and national economy, the Bank's performance, regulatory matters and those discussed in filings by the Bank with the Office of the Comptroller of the Currency.