MOREHEAD CITY, N.C., July 21 /PRNewswire-FirstCall/ -- Sound Bank (OTC:SNBN) (BULLETIN BOARD: SNBN) reported today that pre-tax income for the first six months of 2006 was $735,000, an 86% increase when compared with pre-tax income of $396,000 for the same period of 2005. For the second quarter of 2006, pre-tax income was $418,000 compared with $231,000 for the same period of 2005, an increase of 81%. The Bank also reported net income of $261,000 for the three-month period and $454,000 for the six-month period ended June 30, 2006, or $0.38 and $0.67 per diluted share, respectively. These results reflect increases in net income of 13% and 15%, respectively, when compared with 2005 three-month net income of $231,000, $0.33 per diluted share, and six-month net income of $396,000, $0.56 per diluted share. Having used all of the net operating losses it incurred in the first few years of operations as a result of its cumulative profitability in recent years, Sound Bank began recording income tax expense in 2006. For the three- month and six-month periods ended June 30, 2006, the Bank's income tax expense was $157,000 and $281,000, respectively, compared to no income tax expense for the same periods of 2005. Total assets were $99 million on June 30, 2006, up 26% when compared with June 30, 2005. As of June 30, 2006, loans outstanding were $75 million while deposits amounted to $89 million, resulting in increases of 26% and 30%, respectively, when compared with 2005. Commenting on the Bank's results, Phil Collins, President and CEO, said, "We are very pleased with our performance thus far in 2006. Loans and deposits are growing at a steady pace while earnings continue to set records each quarter. To provide additional capital for future growth, the Bank issued $2 million of subordinated debt in June. Although the Bank had sufficient capital to carry it into 2007, favorable rates and terms made it advantageous to issue the debt at this time. Subordinated debt is treated as an addition to the Bank's capital in computing regulatory capital, thereby increasing our ability to grow." Sound Bank provides a full range of financial services to individuals, businesses and professional partnerships such as personal and corporate accounts, mortgage and retail loans, business vehicle and equipment leasing, certificates of deposit, personal and corporate lines of credit, retirement accounts, wealth management, and on-line banking Additional information about Sound Bank is available on its web site at http://www.soundbanking.net/. The information as of and for the quarter ended June 30, 2006 as presented is unaudited. This news release contains forward-looking statements. The actual results might differ materially from those projected in the forward- looking statements for various reasons, including our limited operating history, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other savings and financial institutions, and changes in real estate values and the real estate market. DATASOURCE: Sound Bank CONTACT: Phil Collins of Sound Bank, +1-252-727-5558 Web site: http://www.soundbanking.net/

Copyright