WHITTIER, Calif., Oct. 31 /PRNewswire-FirstCall/ -- Friendly Hills
Bank (OTC:FHLB) (BULLETIN BOARD: FHLB) reported results for the
third quarter of 2008, its eighth full quarter of operations, since
opening on September 18, 2006. As of September 30, 2008, the bank
reported total assets of $60.9 million, a 34% increase from $45.5
million as of December 31, 2007. The bank's overall deposit base
has grown over 41% in the nine months ended September 30, 2008,
from $31.5 million as of December 31, 2007, to $46.9 million as of
September 30, 2008. Non-interest bearing deposits continue to form
a substantial part of the deposit base (37%), growing from $12.9
million at year-end to $17.4 million as of September 30, 2008.
During the same time period interest bearing deposits advanced over
60% from $18.0 million to $29.5 million on September 30, 2008. The
bank has no deposits which were sourced through brokers or
originated on the basis of above-market rate programs. The bank's
loan portfolio, net of an allowance for loan losses, also continued
to grow, more than doubling from $18.3 million as of December 31,
2007, to $36.8 million as of September 30, 2008. The portfolio
remains diversified with $9.8 million or 26% in Commercial &
Industrial Loans to local businesses and $16.7 million or 45% in
Commercial Real Estate Loans. Owner Occupied properties represent
the largest component of the Commercial Real Estate Portfolio (over
52%) with $8.5 million outstanding. The bank has an additional
$17.0 million in unfunded loan commitments with no non-performing
loans or residential 'sub-prime' mortgage loans. The bank's primary
source of income is Net Interest Income which increased by over 67%
from $1.1 million in the nine months ended September 30, 2007, to
$1.8 million in the nine months ended September 30, 2008. This
increase was a contributing factor in the bank reducing its net
loss for the nine months ended September 30, 2008, by 32% from
$854,610, or ($0.53) per diluted share of common stock for the nine
months ended September 30, 2007, to $578,916, or ($0.36) per
diluted share of common stock. These figures include a loan loss
provision of $237,313 for the nine months ended September 30, 2008,
which was 115% higher than the $110,227 provision for the same
period one year earlier. The increase in reserves reflects the
growth in the loan portfolio as the bank maintained its Allowance
for Loan Losses at 1.25% of loans outstanding. The net loss numbers
also reflect the impact of accounting rules that require companies
to include stock compensation as an expense. On October 10, 2008,
the bank opened its second banking office. This new full service
branch is located at 12070 East Telegraph Road, Suite #100, in the
City of Santa Fe Springs, California. "We all recognize the
unprecedented challenges which face the banking industry today,"
commented Jeffrey K. Ball, Chief Executive Officer. "Through the
course of our bank's history we have managed our institution with
an emphasis on balance sheet strength and cost efficiencies. This
strategy has enabled us to maintain a low cost of funds and a
thorough underwriting approach with strong asset quality focused on
well established local businesses and professionals. We feel that
these factors, combined with our current base of capital, have
positioned the bank very soundly for dealing with these uncertain
times in the market. We are proud to provide our market area with a
reliable, local banking alternative with continued access to credit
while other institutions have been forced to compromise on their
service and reliability. This approach has afforded us the
opportunity to open a second location in Santa Fe Springs ... a
market which has been highly receptive to our consultative approach
to banking. While the current economic environment provides a great
deal of uncertainty, we know that our clients, our employees and
our shareholders can feel confident in the current position of
Friendly Hills Bank." Friendly Hills Bank is a community bank which
was formed to primarily serve the Southern California communities
of Whittier, La Habra, Santa Fe Springs and La Habra Heights, as
well as the surrounding markets of Los Angeles and Orange Counties.
The bank was established in 2006 by prominent members of the local
community who were seeking an alternative to the larger financial
institutions in the area. The bank is headquartered at 16011 E.
Whittier Blvd. in Whittier, California with an additional branch
office at 12070 East Telegraph Road, Suite #100 in Santa Fe
Springs, California. For more information on the Bank, please visit
http://www.friendlyhillsbank.com/ or call 562-947-1920. Forward
Looking Statements: The numbers in this press release are
unaudited. Statements such as those regarding the anticipated
development and expansion of Friendly Hills Bank's business, and
the intent, belief or current expectations of the bank, its
directors or its officers, are "forward looking" statements (as
such term is defined in the Private Securities Litigation Reform
Act of 1995). Because such statements are subject to risks and
uncertainties, actual results may differ materially from those
expressed or implied by such forward looking statements. These
risks and uncertainties include, but are not limited to, risks
related to the local and national economy, the bank's performance,
including its ability to generate loan and deposit growth, changes
in interest rates, and regulatory matters. Friendly Hills Bank
Balance Sheet (Unaudited) 9/30/08 12/31/07 9/30/07 Assets Cash and
cash equivalents $2,145,156 $1,357,598 $1,486,188 Fed funds sold
5,090,000 7,365,000 13,825,000 Investment securities
available-for-sale 15,442,684 17,339,953 11,855,776 Loans, net of
unearned income 37,305,116 18,492,128 13,365,651 Allowance for loan
losses (468,584) (231,271) (166,913) Net loans 36,836,532
18,260,857 13,198,738 Premises and equipment, net 1,068,679 960,604
986,309 Accrued interest receivable and other assets 342,509
218,938 188,739 Total Assets $60,925,560 $45,502,950 $41,540,750
Liabilities Deposits Noninterest-bearing deposits $17,434,259
$12,935,372 $9,562,144 Interest-bearing deposits 29,481,871
18,025,171 17,531,193 Accrued interest payable and other
liabilities 109,417 94,926 61,314 Total Liabilities 47,025,547
$31,055,469 27,154,651 Stockholders' Equity Common stock
$15,957,620 $15,957,620 $15,957,620 Accumulated deficit (2,593,240)
(2,014,323) (1,799,918) Additional paid-in-capital 492,591 303,591
250,602 Accumulated other comprehensive gain (loss) 43,042 200,593
(22,205) Total Stockholders' Equity 13,900,013 14,447,481
14,386,099 Total Liability & Stockholders' Equity $60,925,560
$45,502,950 $41,540,750 Friendly Hills Bank Statement of Operations
(Unaudited) For the nine For the nine months ended months ended
9/30/08 9/30/07 Interest Income $2,152,793 $1,369,097 Interest
Expense 314,139 270,306 Net Interest Income 1,838,654 1,098,791
Provision for Credit Losses 237,313 110,227 Net Interest Income
after Provision for Credit Losses 1,601,341 988,564 Other Income
90,300 31,807 Operating Expenses 2,306,687 1,874,171 Gain (Loss) on
Securities 36,934 - Loss before Provision for Income Taxes
(578,112) (853,800) Provision for Income Taxes (804) (810) Net Loss
$(578,916) $(854,610) Basic Income (Loss) Per Share $(0.36) $(0.53)
Book Value Per Share $8.60 $8.90 Shares Outstanding 1,616,000
1,616,000 DATASOURCE: Friendly Hills Bank CONTACT: Jeffrey K. Ball,
Chief Executive Officer, or George W. Peterson, Chief Financial
Officer, both of Friendly Hills Bank, +1-562-947-1920 Web site:
http://www.friendlyhillsbank.com/
Copyright