Market Overview

American Business Bank Announces Basic Earnings Per Share of $0.75 for the Quarter Ending September 30, 2012 versus $0.73 for the Quarter Ending September 30, 2011

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LOS ANGELES--(BUSINESS WIRE)--

AMERICAN BUSINESS BANK (Bank) (OTCBB: AMBZ) today reported net income of $3,333,000 for the third quarter of 2012, a 2.7% increase over the $3,246,000 earned in the third quarter of 2011. Earnings per share (basic) in the third quarter of 2012 increased to $0.75 versus $0.73 in the third quarter of 2011.

“Once again, the Bank was able to achieve its goals in the third quarter. We have had great success in our marketing efforts, as our seasoned Relationship Managers executed their plans, introduced new clients to the Bank and managed the needs of their customers,” said Leon Blankstein, President.

“American Business Bank continues to focus on a proven business model, banking well managed companies and working hard to contribute to their success,” said Don Johnson, Chief Executive Officer. Mr. Johnson added, “I am proud of the achievements that we have made over the period of my tenure as the founding CEO. We have successfully navigated through arguably the worst financial crisis since the 1930's and we have seen the most changes in the banking sector since then as well, including regulatory reform, consolidation, electronic innovations, etc. I am pleased to announce that effective at our next annual meeting in April of 2013, Leon Blankstein, President of American Business Bank, will also assume the title of Chief Executive Officer. This succession will allow the Bank to continue on as a well- run, customer oriented, profitable and growing company. I will continue on as Vice Chairman, Director, and a resource to the bank. It has been my privilege to have worked with Leon the last 29 years and I have watched him excel at every level.”

Total assets increased 12% or $139 million to $1.279 billion at September 30, 2012 as compared to $1.140 billion at September 30, 2011. The loan portfolio (net) increased 10% or $40 million to $438 million at September 30, 2012 as compared to $398 million at September 30, 2011, while investments and federal funds sold increased $84 million. Deposits increased 5%, or $51 million to $1.060 billion at September 30, 2012 as compared to $1.010 billion at the same period in 2011.

During the third quarter of 2012, Net Interest Income increased $1,063,000 or 12.3% to $9,705,000 from $8,642,000 during the same period in 2011.

Non-Interest expense for the third quarter increased $104,000 or 1.8% to $5,789,000 from $5,685,000 during the third quarter of 2011.

Asset quality at quarter-end remains excellent, with $220,000 non-performing loans and no OREO loans. At the end of September 2012, the allowance for loan losses stood at $9,846,000 or 2.20% of loans.

AMERICAN BUSINESS BANK headquartered in downtown Los Angeles offers a wide range of financial services to the business marketplace. Clients include wholesalers, manufacturers, service businesses, professionals and non-profits. The Bank has opened four Loan Production Offices in strategic areas including our Orange County Office in Irvine, our South Bay Office in Torrance, our San Fernando Valley Office in the Warner Center and our Inland Empire Office in Ontario.

American Business Bank                  
Figures in $000, except per share amounts
     
CONSOLIDATED BALANCE SHEET (unaudited)
 
 
For the period ended:    
September September Change
  2012               2011   %  
Assets:
Cash & Equivalents $ 49,261 $ 36,474 35.1 %
Fed Funds Sold 1,000 0 100.0 %
Interest Bearing Balances 28 1,033 -97.3 %
Investment Securities:
US Agencies 432,016 356,196 21.3 %
Mortgage Backed Securities 184,639 205,191 -10.0 %
State & Municipals 136,513 108,416 25.9 %
    Other             134               140   -4.3 %
Total Investment Securities 753,302 669,943 12.4 %
Gross Loans:
Commercial Real Estate 253,398 222,965 13.6 %
Commercial & Industrial 156,992 147,503 6.4 %
Other Real Estate 31,682 29,761 6.5 %
    Other             5,410               6,017   -10.1 %
Total Gross Loans 447,482 406,246 10.2 %
        Allowance for Loan & Lease Losses       (9,846 )             (8,377 ) 17.5 %
Net Loans 437,636 397,869 10.0 %
Premises & Equipment 793 1,174 -32.5 %
  Other Assets             37,723               33,751   11.8 %
    Total Assets           $ 1,279,743             $ 1,140,244   12.2 %
 
Liabilities:
Demand Deposits $ 532,999 $ 427,856 24.6 %
Money Market 446,893 479,488 -6.8 %
  Time Deposits and Savings           80,244               102,215   -21.5 %
Total Deposits 1,060,136 1,009,559 5.0 %
FHLB Advances / Other Borrowings 100,000 33,300 200.3 %
  Other Liabilities             19,210               14,141   35.8 %
    Total Liabilities           $ 1,179,346             $ 1,057,000   11.6 %
 
Shareholders' Equity:
Common Stock & Retained Earnings $ 87,799 $ 77,002 14.0 %
  Accumulated Other Comprehensive Income       12,598               6,242   101.8 %
    Total Shareholders' Equity         $ 100,397             $ 83,244   20.6 %
    Total Liabilities & Shareholders' Equity     $ 1,279,743             $ 1,140,244   12.2 %
 
Capital Adequacy:
Tangible Common Equity / Tangible Assets 7.85 % 7.30 % --
Tier 1 Leverage Ratio 7.25 % 7.03 % --
Tier 1 Capital Ratio / Risk Weighted Assets 17.50 % 16.67 % --
Total Risk-Based Ratio 18.76 % 17.93 % --
 
Per Share Information:
Common Shares Outstanding 4,432,331 4,427,620 --
Book Value Per Share $ 22.65 $ 18.80 20.5 %
Tangible Book Value Per Share $ 22.65 $ 18.80 20.5 %
 
 
American Business Bank    
Figures in $000, except per share amounts
               
CONSOLIDATED INCOME STATEMENT (unaudited)
 
 
For the 3-month period:  
September September Change
  2012             2011   %  
Interest Income:
Loans & Leases $ 5,856 $ 5,496 6.6 %
  Investment Securities           4,473             4,048   10.5 %
Total Interest Income 10,329 9,544 8.2 %
 
 
Interest Expense:
Money Market, NOW Accounts & Savings 426 613 -30.5 %
Time Deposits 123 222 -44.6 %
  Repurchase Agreements / Other Borrowings       75             67   11.9 %
Total Interest Expense 624 902 -30.8 %
 
 
Net Interest Income 9,705 8,642 12.3 %
  Provision for Loan Losses           (300 )           (375 ) -20.0 %
Net Interest Income After Provision 9,405 8,267 13.8 %
 
 
Non-Interest Income:
Deposit Fees 259 257 0.8 %
Realized Securities Gains / (Losses) 937 1,332 -29.7 %
  Other                 263             460   -42.8 %
Total Non-Interest Income 1,459 2,049 -28.8 %
 
 
Non-Interest Expense:
Compensation & Benefits 3,583 3,247 10.3 %
Occupancy & Equipment 532 541 -1.7 %
  Other                 1,674             1,897   -11.8 %
Total Non-Interest Expense 5,789 5,685 1.8 %
 
 
Pre-Tax Income 5,075 4,631 9.6 %
  Provision for Income Tax           (1,742 )           (1,385 ) 25.8 %
 
 
Net Income             $ 3,333           $ 3,246   2.7 %
 
 
 
Per Share Information:
Average Shares Outstanding (for the quarter) 4,432,331 4,427,620 --
Earnings Per Share - Basic $ 0.75 $ 0.73 2.6 %
 
American Business Bank      
Figures in $000, except per share amounts
                   
 
 
September September Change
  2012             2011   %  
 
Performance Ratios
Return on Average Assets (ROAA) 1.06 % 1.15 % --
Return on Average Equity (ROAE) 13.58 % 16.23 % --
 
 
 
Asset Quality Overview
Non-Performing Loans $ - $ 2,255 -100.0 %
  Loans 90+Days Past Due           220             0     100.0 %
Total Non-Performing Loans $ 220 $ 2,255 -90.2 %
 
Restructured Loans (TDR's) $ 4,928 $ 140 3420.0 %
 
Other Real Estate Owned 0 0 --
 
ALLL / Gross Loans 2.20 % 2.06 % --
ALLL / Non-Performing Loans * 4475.45 % 371.49 % --
Non-Performing Loans / Total Loans * 0.05 % 0.56 % --
Non-Performing Assets / Total Assets * 0.02 % 0.20 % --
Net Charge-Offs $ - $ - --
Net Charge-Offs / Average Gross Loans 0.00 % 0.00 % --
 
* Excludes Restructured Loans
 

American Business Bank
Wes E. Schaefer
Vice Chairman and Chief Financial Officer
(213) 430-4000

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