PACIFIC STATE BANCORP 
By
-- Net income for the quarter ended March 31, 2008 decreased 17.5% to
$1,094,000 from the first quarter of 2007.
-- Total Assets as of March 31, 2008 increased 2.9% or 11.7% annualized to
$443,680,000 from December 31, 2007.
Mr. Rosso noted that the decreased income performance is primarily the
result of the Bank experiencing a contraction in its net interest margin. The
contraction of the net interest margin is the result of the Bank's interest
earning assets repricing downward more quickly, after the federal reserve rate
cuts, than the Bank's interest bearing liabilities. During the second and
third quarters of 2008, approximately
In addition to a contracting net interest margin, the Bank has also
experienced a decline in non-interest income of
The Bank has also experienced an increase in nonperforming loans from
The increase of
PSBC financial performance information for the three month period ending
Income Statement:
-- Total Interest Income: $7,301,000, a decrease of $205,000 or 2.7%.
-- Total Interest Expense: $3,382,000, an increase of $207,000 or 6.5%.
-- Net Interest Income: $3,919,000, a decrease of $412,000 or 9.5%.
-- Non-Interest Income: $472,000, a decrease of $214,000 or 31.2%.
-- Non-Interest Expense: $2,495,000, a decrease of $215,000 or 7.9%.
-- Provision for loan losses: $210,000, an increase of $45,000 or 27.3%.
-- Net Income: $1,094,000, a decrease of $232,000 or 17.5%.
-- Efficiency Ratio: 56.8% deteriorating from 54.0%.
-- Basic Earnings Per Share: $0.30 a decrease of $0.06 per share or 17.9%.
-- Diluted Earnings Per Share: $0.27, a decrease of $0.06 per share or
17.5%.
-- ROAA: Annualized rate of 1.05%, a decrease of 37 basis points from
1.42%
-- ROAE: Annualized rate of 12.85%, a decrease of 5.61% from 18.46%
PSBC
Balance Sheet:
-- Total Federal Funds and Investment Securities: $72,255,000, a decrease
of $3,977,000 or an annualized 21.2%.
-- Net Loans: $325,041,000, an increase of $16,583,000 or an annualized
21.9%.
-- Total Assets: $443,680,000, an increase of $12,606,000 or an annualized
11.9%.
-- Non-Interest Bearing Deposits: $60,318,000, a decrease of $6,753,000 or
an annualized 40.9%.
-- Total Deposits: $355,316,000, an increase of $13,495,000 or an
annualized 16.1%.
-- Total Borrowings: Remained at $40,000,000.
-- Total Shareholders Equity: $35,129,000, an increase of $1,093,000 or an
annualized 13.1%.
Attached are certain unaudited financial statements supporting the
financial information summarized above. Further inquiries should be directed
to Mr. Rosso at 209-870-3214, or by mail to P.O. Box 1649,
SAFE HARBOR: Except for historical information contained herein, the statements contained in this press release are forward-looking statements within the meaning of the "safe harbor" provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to risks and uncertainties. Actual results may differ materially from those set forth in or implied by forward-looking statements. These risks are described from time to time in Pacific State Bancorp's Securities and Exchange Commission filings, including its Annual Reports on Form 10-K and quarterly reports on Form 10-Q. Pacific State Bancorp disclaims any intent or obligation to update these forward-looking statements.
PACIFIC STATE BANCORP AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited March 31, December 31,
(Dollars in thousands) 2008 2007
ASSETS
Cash and due from banks $13,130 $13,794
Federal funds sold 21,716 31,880
Total cash and cash equivalents 34,846 45,674
Interest bearing deposits at other banks 3,000 3,000
Investment securities 47,539 41,352
Loans, less allowance for loan losses
of $3,629 in 2008 and $3,948 in 2007 325,041 308,458
Premises and equipment, net 14,659 14,269
Company owned life insurance 8,101 8,025
Accrued interest receivable and other assets 10,494 10,296
Total assets $443,680 $431,074
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Non-interest bearing $60,318 $67,071
Interest bearing 294,998 274,750
Total deposits 355,316 341,821
Other borrowings 40,000 40,000
Subordinated debentures 8,764 8,764
Accrued interest payable and other liabilities 4,471 6,453
Total liabilities 408,551 397,038
Commitments and contingencies
Shareholders' equity:
Preferred stock - 2,000,000 shares
authorized; none issued or outstanding - -
Common stock - no par value;
24,000,000 shares authorized;
issued and outstanding - 3,703,207 shares
in 2008 and 3,703,207 shares in 2007 10,504 10,418
Retained earnings 25,098 24,004
Accumulated other comprehensive
loss, net of taxes (473) (386)
Total shareholders' equity 35,129 34,036
Total liabilities and
shareholders' equity $443,680 $431,074
PACIFIC STATE BANCORP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) Three Months Ended March 31,
(Dollars in thousands, except per share data) 2008 2007
Interest income:
Interest and fees on loans $6,476 $6,842
Interest on Federal funds sold 115 321
Interest on investment securities 710 343
Total interest income 7,301 7,506
Interest expense:
Interest on deposits 2,798 2,917
Interest on borrowings 430 66
Interest on subordinated debentures 154 192
Total interest expense 3,382 3,175
Net interest income before provision
for loan losses 3,919 4,331
Provision for loan losses 210 165
Net interest income after provision
for loan losses 3,709 4,166
Non-interest income:
Service charges 237 221
Gain on sale of loans 19 9
Other income 216 456
Total non-interest income 472 686
Non-interest expenses:
Salaries and employee benefits 1,268 1,482
Occupancy 263 286
Furniture and equipment 179 167
Other expenses 785 775
Total non-interest expenses 2,495 2,710
Income before provision for income taxes 1,686 2,142
Provision for income taxes 592 816
Net income $1,094 $1,326
Basic earnings per share $0.30 $0.36
Diluted earnings per share $0.27 $0.33
PACIFIC STATE BANCORP
Yield Analysis
For Year Ended March 31,
(Dollars in thousands) 2008 2007
Interest Average Interest Average
Income Yield Income Yield
Average or or Average or or
Assets: Balance Expense Cost Balance Expense Cost
Interest-earning assets:
Loans $321,423 $6,476 8.10% $292,410 $6,842 9.49%
Investment securities 48,044 704 5.89% 26,737 343 5.20%
Federal funds sold 13,167 115 3.51% 26,149 321 4.98%
Interest Bearing
Deposits in Banks 3,000 6 0.80% 0 0 0.00%
Total average
earning assets $385,634 $7,301 7.61% $345,296 7,506 8.82%
Non-earning assets:
Cash and due from banks 12,944 18,802
Bank premises
and equipment 14,458 11,987
Other assets 16,104 9,058
Allowance for loan loss (4,009) (2,544)
Total average assets $425,131 $382,599
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
Deposits
Interest-bearing
Demand $69,081 $389 2.26% $87,840 $608 2.81%
Savings 5,359 7 0.53% 5,595 14 1.01%
Time Deposits 200,610 2,402 4.82% 179,076 2,295 5.20%
Other borrowing 49,116 584 4.78% 13,787 258 7.59%
Total average
interest-bearing
liabilities $324,166 $3,382 4.20% $286,298 $3,175 4.50%
Noninterest-bearing
liabilities:
Demand deposits 61,640 65,347
Other liabilities 4,708 1,488
Total average
liabilities 390,514 353,133
Shareholders' equity: 34,617 29,466
Total average
liabilities and
shareholders' equity $425,131 $382,599
Net interest income $3,919 $4,331
Net interest margin 4.09% 5.09%
SOURCE Pacific State Bancorp
