CYBA Canyon Bancorp (CE)

Canyon Bancorp (OTCBB:CYBA) today announced total assets have grown to $300 million with net loans receivable exceeding $250 million and net income for the first quarter 2008 of $52,000 or $0.02 per diluted share. Like many Southern California banks, the Company�s earnings were affected by�the current residential real estate market conditions that impacted construction loans. The provision for loan losses increased from $90,000 in the first quarter of 2007 to $1,160,000 in the first quarter of 2008 due to these factors and increases in classified loans and loan charge-offs. President and CEO Stephen G. Hoffmann said, �In view of the challenging economy, particularly real estate in Southern California, it is encouraging to report solid growth in assets, loans, deposits and shareholders equity compared to the first quarter 2007.� Other financial highlights for the first quarter 2008 compared to the same period in 2007: Total assets increased $32.5 million or 12.1 percent to $300.2 million. Net loans receivable increased $40.1 million or 19.0 percent to $250.8 million. Total deposits increased $8.8 million or 3.7 percent to $248.7 million. Book value per share increased $1.04 or 9.9 percent to $11.55. Total shareholders� equity increased by $2.8 million or 11.0 percent to $28.6 million. Capital to assets ratio for the first quarter 2008 was 9.54 percent compared to 9.64 percent for the same period in 2007. Canyon Bancorp is a bank holding company with one banking subsidiary, Canyon National Bank, a full-service commercial bank and member of the FDIC. Palm Springs branch locations are at 1711 East Palm Canyon Drive at the Smoke Tree Village Shopping Center and 901 East Tahquitz Canyon Way. Palm Desert branch locations are at 74-150 Country Club Drive and 77-933 Las Montanas Road across from Sun City. Shares of the Company�s common stock are traded on the Over the Counter Bulletin Board � stock symbol CYBA. This release may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements. CANYON BANCORP & SUBSIDIARY Consolidated Balance Sheets (Dollars in thousands, except per share amounts) � � � � � � � � 3/31/2008 (Unaudited) 12/31/2007 (Audited) 3/31/2007 (Unaudited) Assets � Cash and cash equivalents $ 24,234 $ 13,562 $ 32,583 Interest-bearing deposits in other financial institutions � � 1,600 Investment securities available for sale 10,018 12,196 11,956 Federal Home Loan Bank, Federal Reserve Bank and Pacific Coast Bankers' Bank restricted stock, at cost 1,890 1,890 1,573 Loans held for sale 636 123 1,420 Loans receivable, net 250,800 248,468 210,709 Furniture, fixtures and equipment 5,561 5,680 4,436 Income tax receivable 889 909 � Deferred tax asset 1,420 1,430 1,706 Foreclosed assets 3,090 3,073 � Other assets 1,640 1,825 � 1,690 � � Total Assets $ 300,178 $ 289,156 � $ 267,673 � � Liabilities and Stockholders� Equity � Deposits: Demand deposits $ 79,786 $ 73,961 $ 87,045 NOW accounts 13,346 14,223 13,102 Savings and money market 95,747 79,262 81,553 Time certificate of deposits 59,840 63,181 � 58,228 � � Total Deposits 248,719 230,627 � 239,928 � � Other borrowed funds 20,899 28,160 Other liabilities 1,911 1,795 � 1,938 � � Total Liabilities 271,529 260,582 � 241,866 � � Commitments and contingencies � � � � � � Stockholders� Equity: Serial Preferred Stock, $5.00 par value; authorized 10,000,000 shares; none issued or outstanding � � � Common Stock; authorized 10,000,000 shares; 2,479,927 shares issued and outstanding as of March 31, 2008 and December 31, 2007, and 2,338,627 shares issued and outstanding as of March 31, 2007 � � 23,513 23,513 21,103 Additional paid-in capital � � � Accumulated other comprehensive income: Unrealized gain (loss) on investment securities available-for-sale 8 (15 ) (93 ) Retained earnings 5,128 5,076 � 4,797 � � Total Stockholders� Equity 28,649 28,574 25,807 � Total Liabilities and Stockholders� Equity $ 300,178 $ 289,156 � $ 267,673 � CANYON BANCORP & SUBSIDIARY Consolidated Statement of Operations (Unaudited) For the three months ended March 31, 2008 and 2007 (Dollars in thousands, except per share amounts) � � � Three months ended March 31, 2008 � 2007 Interest income: Loans receivable $ 4,854 $ 4,820 Federal funds sold 80 179 Interest bearing deposits in other financial institutions � 17 Investment securities available for sale 132 � 141 Total interest income 5,066 5,157 Interest expense Deposits 1,325 1,343 Other borrowed funds 289 � � Total interest expense 1,614 1,343 � Net interest income 3,452 3,814 � Provision for loan losses 1,160 � 90 � Net interest income after provision for loan losses 2,292 � 3,724 Noninterest income: Service charges and fees 193 166 Loan related fees 36 178 Lease administration fees 96 222 Automated teller machine fees 179 163 Net loss on sale of foreclosed assets (19 ) � Net gain on sale of investment securities 21 � � Total noninterest income 506 � 729 Noninterest expenses: Salaries and employee benefits 1,358 1,429 Occupancy and equipment expense 395 372 Professional fees 53 70 Data processing 166 144 Marketing and advertising expense 135 115 Director and shareholder expense 146 112 Foreclosed asset expense, net 26 � Other operating expense 447 � 409 Total noninterest expenses 2,726 � � 2,651 � Earnings before income taxes 72 1,802 � Income tax expense 20 � 731 � Net earnings $ 52 � $ 1,071 Earnings per share: Basic $ 0.02 $ 0.44 Diluted $ 0.02 $ 0.42 Weighted average shares outstanding: Basic 2,479,927 2,439,174 Diluted 2,536,790 2,543,346 CANYON BANCORP & SUBSIDIARY Selected Ratios (Unaudited) � � � � � � � � Three Months Ended 1 � 3/31/2008 � � 3/31/2007 � � Return on average equity 0.72 % 17.24 % Return on average assets 0.07 % 1.66 % Yield on interest-earning assets 7.32 % 8.57 % Cost of interest-bearing liabilities 3.39 % 3.73 % Net interest margin 4.99 % 6.34 % Non-interest income / average assets 0.68 % 1.13 % Non-interest expense / average assets 3.65 % 4.11 % Net non-interest expense / average assets 2.97 % 2.98 % Net charge-offs/(recoveries) to average loans 0.85 % 0.28 % � as of: � 3/31/2008 � � 3/31/2007 � � Capital to assets ratio 9.54 % 9.64 % Allowance for loan losses / gross loans 1.43 % 1.56 % Loan to deposit ratio 102.7 % 87.8 % Adversely classified loans to gross loans 7.2 % 1.0 % Non-accrual loans to gross loans 2.6 % 0.8 % Demand deposit accounts / total deposit accounts 32.1 % 36.3 % Book value per share2 $ 11.55 $ 10.51 � 1Interim periods annualized 2Prior year restated for past stock dividends and splits