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1st Enterprise Bank Announces Record Quarterly Net Income of
$1.5 Million for the 1st Quarter of 2014

LOS ANGELES, CA  – (Marketwired - Apr 16, 2014) – 1st Enterprise Bank ("the Bank") (OTCBB: FENB), an independent full-service commercial bank serving the Southern California business community, reported net income of $1.5 million for the quarter ending March 31, 2014.

Financial Highlights

  • Net income for the quarter ending March 31, 2014 was $1.5 million, a 27% increase over the prior quarter and a 48% increase over the prior year
  • Diluted earnings per common share were $.35 for the quarter, compared to $.28 in the fourth quarter of 2013 and $.24 in the first quarter of 2013
  • Total Assets grew by $74 million, from $702 million at March 31, 2013 to $776 million at March 31, 2014
  • Total Loans outstanding grew by $88 million, from $419 million at March 31, 2013 to $507 million at March 31, 2014
  • Total Deposits grew by $50 million, from $601 million at March 31, 2013 to $652 million at March 31, 2014
  • Income before taxes, loan loss provision and gain on sale of securities was $2.3 million for the quarter, a 16% increase over the prior year

John Black, CEO, stated, "We continue to be very pleased with the Bank's earnings and asset growth. Once again I am excited to announce record quarterly earnings, as well as loan growth that exceed 20% over the last 12 months." Brian Horton, President, added, "This growth validates our customers' appreciation for the importance of relationship banking and is the result of the efforts of a very talented staff."

For the three months ended March 31, 2014, net interest income before provision was $6.1 million, an increase of 17% compared to the first quarter of 2013 and an increase of 5% compared to the fourth quarter of 2013. The year-over-year growth in net interest income was the result of both growth in earning assets and expansion in net interest margin. Earning assets were $704 million in the first quarter of 2014, an 8% or $51 million increase over the prior year. The net interest margin was 3.50% during the first quarter of 2014, compared to 3.23% for the prior year. The increase in net interest margin was the result of a .27% increase in the earning asset yield over the prior year. The growth in net interest income over the prior quarter was mostly the result of an increase in the net interest margin from 3.30% to 3.50%. This increase resulted from the yield on earning assets increasing by 0.20% from the prior quarter as loan balances grew from 68% of earning assets to 73% and the yield on investment securities increased by .26%. There was no provision for loan loss during the quarter, compared to a provision of $542,000 in the first quarter of 2013 and a provision of $710,000 in the fourth quarter of 2013. There were no loan charge-offs during the first quarter of 2014 or the fourth quarter of 2013, compared to net loan charge-offs during the first quarter of 2013 that totaled $349,000. As of March 31, 2014 there was one non-accrual loan that totaled $1.7 million.

Non-interest income, excluding gain on sale, was $900,000 for the quarter, which was a 20% increase year over year, but declined by $124,000 sequentially due to lower loan related income. Growth in non-interest income from the prior year was generally due to increased deposit related fees.

Non-interest expense increased by $720,000 or 18% over the prior year and increased by $128,000 or 3% over the prior quarter. The year over year increase is mostly the result of continued investment in staffing levels to support current and future customer growth. The sequential increase in non-interest expense was due to a $112,000 increase in the Bank's off-balance sheet reserves due to growth in unused loan commitments.

About 1st Enterprise Bank

Founded in 2006, 1st Enterprise Bank is a full service independent commercial banking institution, whose highly experienced bankers personally serve Southern California entrepreneurial businesses, professional firms and nonprofit organizations, along with their owners and key managers. Headquartered in the Los Angeles financial district, with full service regional banking offices in Irvine and Ontario and an LPO in Woodland Hills, 1st Enterprise Bank offers a full range of credit and depository services, with special emphasis on superior customer service, sophisticated cash management services and direct access to bank decision makers. Customers work directly with a dedicated Relationship Manager, a seasoned professional who understands their unique challenges serving as a sounding board and an active participant in their client's success. For more information on 1st Enterprise Bank, please visit www.1stenterprisebank.com.

Forward-Looking Statement:

This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about 1st Enterprise Bank's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and the following: 1st Enterprise Bank's timely implementation of new products and services, technological changes, changes in consumer spending and savings habits and other risks discussed from time to time in 1st Enterprise Bank's reports and filings with banking regulatory agencies. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and 1st Enterprise Bank does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

1st Enterprise Bank
Condensed Statements of Financial Condition

 
3/31/2014
 
12/31/2013
 
3/31/2013
Assets
unaudited
 
unaudited
 
audited
      Cash and due from banks
$ 33,270
 
$ 12,126
 
$ 16,393
       Interest earning deposits in other banks
29,461
 
5,793
 
14,560
            Total cash and cash equivalents 62,731   17,919   30,953
      Certificates of deposit in other banks -   -   2,490
      Investment securities - available-for-sale 113,071   148,809   164,580
      Investment securities - held-to-maturity 61,769   62,118   55,753
      Loans, net of deferred loan fees 513,360   505,258   425,009
      Allowance for loan losses
(6,519)
 
(6,517)
 
(5,703)
      Loans, net of allowance for loan losses 506,841   498,741   419,306
      Bank Owned Life Insurance 16,538   16,411   16,017
      Premises and equipment, net 2,372   2,453   2,700
       Accrued interest receivable and other assets
12,590
 
13,550
 
9,985
            Total Assets
$ 775,912
 
$ 760,001
 
$ 701,784
Liabilities          
      Non-interest-bearing demand deposits
$ 321,500
 
$ 315,888
 
$ 268,584
      Interest bearing transaction accounts 43,770   39,358   35,250
      Money market, savings accounts 270,219   277,035   278,610
      Time deposits
16,083
 
10,518
 
18,996
            Total Deposits 651,572   642,799   601,440
      Federal Home Loan Bank borrowings 50,000   44,000   30,500
      Other liabilities
3,253
 
3,923
 
3,484
            Total Liabilities 704,825   690,722   635,424
Shareholders' Equity          
      Serial Preferred Stock 16,380   16,380   16,380
      Common Stock 43,378   43,142   43,048
      Retained Earnings 11,245   9,781   5,918
       Accumulated other comprehensive income
84
 
(24)
 
1,014
            Total Shareholders' Equity
71,087
 
69,279
 
66,360
Total Liabilities and Shareholders' Equity
$ 775,912
 
$ 760,001
 
$ 701,784

1st Enterprise Bank
Condensed Statements of Operations

 
Three Months Ended
 
unaudited
Interest Income
3/31/2014
 
12/31/2013
 
3/31/2013
      Interest and fees on loans
$ 5,293
 
$ 5,036
 
$ 4,428
      Interest on investment securities 972   944   952
      Other interest income
3
 
8
 
10
            Total interest income 6,268   5,988   5,198
Interest Expense
191
 
189
 
542
Net Interest Income 6,077   5,089   4,656
Provision for loan losses
-
 
710
 
513
Net Interest Income After Provision for Loan Losses 6,077   5,089   4,656
Non-interest Income          
Service charges, fees and other income 900   1,024   749
Gain/(Loss) on sale of investment sercurities
41
 
-
 
-
      Total non-interest Income 941   1,024   749
Non-interest Expenses          
      Compensation and benefit expenses 2,876   2,846   2,431
      Occupancy and equipment expenses 379   393   374
      Data processing 268   269   256
      Professional and legal 401   382   328
      Other expenses
761
 
667
 
575
            Total non-interest expense 4,685   4,557   3,964
Income Before Income Taxes
2,334
 
1,557
 
1,442
Provision for income taxes
829
 
369
 
425
Net Income
$ 1,505
 
$ 1,187
 
$ 1,017
Preferred dividends & Warrant amortization
41
 
41
 
41
Net Income Applicable to Common Shareholders
$ 1,464
 
$ 1,146
 
$ 976
Earnings Per Share:          
Basic earnings per share
$ 0.38
 
$ 0.30
 
$ 0.26
Diluted earnings per share
$ 0.35
 
$ 0.28
 
$ 0.24
Average shares outstanding 3,803,389   3,798,213   3,793,150
Average fully diluted shares 4,182,521   4,149,582   4,062,894
Total Shares outstanding at end of period 3,840,938   3,823,939   3,815,089
Capital Ratios:          
Tier 1 leverage ratio 9.5 %   9.3 %   9.4 %
Tier 1 risk-based capital ratio 11.1 %   11.0 %   11.9 %
Total risk-based capital ratio 12.2 %   12.0 %   13.0 %
Book value per share
$ 14.24
 
$ 13.83
 
$ 13.10
Performance Ratios:          
Return on average assets 0.81 %   0.63 %   0.59 %
Return on average common equity 10.98 %   8.57 %   7.95 %
Net interest margin 3.50 %   3.30 %   3.23 %
Cost of Funds 0.11 %   0.11 %   0.12 %
Efficiency ratio 66.80 %   66.41 %   66.70 %
Average Balances:          
Total Assets
$ 751,031
 
$ 742,247
 
$ 695,576
Earning Assets 704,112   696,826   653,274
Total Loans 512,559   477,186   415,003
Total Securities 188,384   209,826   230,343
Total Deposits 634,225   656,444   606,208
Common Equity 54,075   53,091   49,812

Contact:
John C. Black
CEO
213-430-7070
Copyright 2012, 1st Enterprise Bank, Inc. All rights reserved.