UPDATE: Sierra Vista Bank Reports 1Q12 Results

Takes Elevated Provisions for Specific Reserves on Two Restructured Loans
Net Interest Margin Remains Strong and Fee Income Increases

FOLSOM, Calif., April 23, 2012 (GLOBE NEWSWIRE) -- Sierra Vista Bank (OTCBB:SVBA) today reported that following a $810,000 provision for loan losses that included $600,000 in specific reserves for two restructured loans to one borrower, it lost $697,000, or $0.35 per share, in the first quarter of 2012. This compares to a loss of $21,000, or $0.01 per share, for the first quarter a year ago and a profit of $64,000, or $0.03 per share, in the fourth quarter of 2011. All financial results are preliminary and unaudited.

"The Bank's core operations continue to reflect fundamentals with a healthy net interest margin and increasing non-interest income," said Gregory Patton, President and CEO. "We continue to focus on positioning ourselves to be able to utilize our net operating loss carry-forward as we return to profitability. Additionally, our platform has helped us attract highly qualified bankers including Ken Sheffer, our new Chief Credit Officer. Ken has over 34 years of experience working in credit administration."

"We are building a franchise with support from our local community in the greater Sacramento and Folsom market," Patton continued. "Total deposits increased over 4% from the previous quarter and now nearly one third of our deposits consist of non-interest bearing deposits. Our deposit costs have continued to decline and were 0.38% for the most recent quarter. As our deposit balances have increased, so has our non-interest income."

For the first quarter of fiscal 2012, Sierra Vista Bank's net interest margin was 4.80%, compared 5.10% for the fourth quarter of 2011 and 5.06% in the first quarter a year ago. 

Financial Highlights (at or for the quarter ended March 31, 2012)

• Reporting its first profitable year in 2011 since beginning operations in 2007, the Bank's profitability was interrupted with a loss in the 1^st quarter of 2012. The loss stems primarily from the restructuring of two loans to one borrower requiring specific reserves totaling $600,000.
• Loan loss reserves to gross loans totaled 3.44% at March 31, 2012, compared to 2.80% one year earlier.
• Capital levels continued to remain well above the regulatory "well-capitalized" minimum levels:

• The Tier 1 Leverage Capital ratio was 9.02% at March 31, 2012 compared to 9.03% one year earlier.
• The Tier 1 Risk Based Capital ratio was 12.56%; at the end of the first quarter compared to 12.51% a year ago.
• The Total Risk Based Capital ratio was 13.84% at March 31, 2012 compared to 13.78% at March 31, 2011.

• Book value was $3.68 per share at March 31, 2012 compared to $3.93 per share at March 31, 2011.
• Non-performing assets as a percent of total assets were 5.68% at March 31, 2012 compared to 4.23% a year ago.
• The Bank had no past due loans at either March 31, 2012 or 2011.

Sierra Vista had total assets of $82.7 million at March 31, 2012, an increase of $2.2 million from December 31, 2011. Net Loans totaled $55.2 million at the end of March compared to $59.1 million at December 31, 2011.  Deposits totaled $72.9 million at March 31, 2012 compared to $70.0 million at December 31, 2011. Non-interest bearing deposits totaled $23.8 million or 32.7% of total deposits at March 31, 2012, compared to $22.0 million or 31.5% of total deposits the previous quarter. 

"We are continuing to address the challenges that are impacting our industry and remain confident that our core operations are solid," noted Lesa Fynes, Chief Financial Officer. "While we took our headquarters building into other real estate this quarter which increased our nonperforming assets, the building has other tenants and we believe we have a number of solid options for the property going forward."

Non-performing assets totaled $4.70 million at the end of March 2012 compared to $3.55 million at the end of March 2011. Non-performing assets include loans classified as non-accrual of $3.12 million and real estate owned of $1.58 million at March 31, 2012. "With the exception of $225,000, all non-accruing loans are either paying as agreed and current, or paying as agreed under forbearance agreements," Fynes noted. In the first quarter, Sierra Vista sold one of its two foreclosed properties for $280,000 generating a gain on sale of $56,000. The real estate owned balance of $1.58 million includes the Bank's headquarters valued at $1.47 million.

About Sierra Vista Bank

Sierra Vista Bank is a locally owned community bank headquartered at 1710 Prairie City Road in Folsom, California since March 2007 and has a branch located in the Sam's Town Center in Cameron Park. The Bank prides itself on serving the financial needs of small businesses and professionals in Folsom and throughout the Highway 50 Corridor while remaining committed to community philanthropy. Additional information about Sierra Vista Bank can be found at www.sierravistabank.com or by calling (916) 850-1500.

Forward Looking Statement:

In addition to historical information, this press release includes forward-looking statements, such as statements regarding increases in non-interest income, future profitability, the bank's ability to address challenges impacting economy in which it operates and future loan losses, which reflect management's current expectations for the bank's future financial results and business prospects. Forward-looking statements are inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to: (a) changes in competitive pressures among depository and other financial institutions or in the bank's ability to compete effectively against larger financial institutions in its banking market; (b) actions of government regulators or changes in laws, regulations or accounting standards, that adversely affect the bank's business; (c) changes in interest rates and/or inflation; (d) changes in general economic or business conditions and the real estate market in the bank's market; and (e) other unexpected developments or changes in the bank's business or its customers' businesses. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. You should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.