Mission Oaks National Bank Announces Results


TEMECULA, Calif. April 10, 2003 (PRIMEZONE) -- Mission Oaks National Bank (OTCBB:MKNB) in the first quarter of 2003 picked up where it left off at the end of 2002.

The Temecula-based community bank earned $225,000, or 29 cents a share in the first quarter. That compares with a loss of $24,000, or 3 cents a share, a year ago. It was the third consecutive profitable quarter for Mission Oaks, which finished 2002 with an annual profit of $337,000.

Founded in November 2000, the bank benefited from strong asset and loan growth and contributions from its fast-growing small business lending operation.

At year-end Mission Oaks was the fifth busiest small business lender in Riverside County and the 22nd busiest in Southern California, according to the Small Business Administration.

"We continue to build on the strong foundation that was put in place over the past two years," said Gary Votapka, Mission Oaks president and chief executive officer. "And we've been able to do this without any delinquent or non-performing loans."

Total assets as of March 31 reached $69.7 million, up more than 74 percent from the same period a year ago. In the last three months alone, bank assets grew by $11.3 million.

Loans at the end of the quarter reached $46.7 million, up 86.5 percent from a year ago.

Despite the rapid growth, Mission Oaks has kept expenses in line. While interest income increased 71.7 percent to $910,000, interest expense rose 59.7 percent to $206,000. As a result, Mission Oaks finished the quarter with net interest income of $704,000, up 75.6 percent from the same quarter a year ago.

Mission Oaks reported that non-interest income grew nearly three-fold to $335,000 from $105,000 a year ago.

Mission Oaks National Bank is a full-service community bank that serves Southwest Riverside and Northern San Diego counties.

For more on Mission Oaks National Bank visit its Web site at www.missionoaksbank.com.

Safe Harbor

Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to the company's current expectations regarding future operating results and growth in loans, deposits, and assets. These forward looking statements are subject to certain risks and uncertainties that could cause the actual results, performance or achievements to differ materially from those expressed, suggested or implied by the forwardlooking statements.

These risks and uncertainties include, but are not limited to: (1) the impact of changes in interest rates, a decline in economic conditions and increased competition among financial service providers on the company's results of operation, (2) the company's ability to continue its internal growth rate, (3) the company's ability to build net interest spread, (4) the quality of the company's earning assets, and (5) government regulations.



 MISSION OAKS NATIONAL BANK
 FIRST QUARTER REPORT / MARCH 31, 2003
 BALANCE SHEET
 (all amounts in whole dollars except share and per share information)

                    March 31,      March 31,      Increase   Increase
                      2003           2003        (Decrease) (Decrease)
                  -----------    -----------     ---------- ----------
 ASSETS
  Cash and due
   from banks     $ 1,837,000    $ 2,510,000      ($673,000)    -26.8%
  Due from banks
  - time              694,000        297,000        397,000     133.7%
  Federal funds
   sold             6,570,000      3,335,000      3,235,000      97.0%
  Securities -
   available for
   sale            12,653,000      6,963,000      5,690,000      81.7%
  Securities -
   held to
   maturity                 0      1,000,000     (1,000,000)   -100.0%

  Loans            46,740,000     25,063,000     21,677,000      86.5%
  Less allowance
   for loan
   losses            (565,000)      (325,000)      (240,000)     73.8%
                  -----------    -----------     ----------
  Loans, net       46,175,000     24,738,000     21,437,000      86.7%

  Bank premises
   and equipment,
   net                692,000        507,000        185,000      36.5%
  Other real
   estate owned,
   net                      0              0              0
  SBA - Loan
   servicing
   asset               69,000         18,000         51,000     283.3%
  Other assets      1,017,000        611,000        406,000      66.4%
                  -----------    -----------     ----------
                  $69,707,000    $39,979,000     29,728,000      74.4%
                  ===========    ===========     ==========

 LIABILIITIES AND
  STOCKHOLDERS' EQUITY

  Demand
   deposits       $16,138,000    $ 9,460,000    $ 6,678,000      70.6%
  Interest
   bearing
   deposits        46,110,000     24,023,000     22,087,000      91.9%
  Federal funds
   purchased and
   other
   borrowings               0              0              0
  Other
   liabilities        408,000        141,000        267,000     189.4%
                  -----------    -----------    -----------
  Total
   liabilities     62,656,000     33,624,000     29,032,000      86.3%
  Total
   stockholders'
   equity           7,051,000      6,355,000        696,000      11.0%
                  -----------    -----------    -----------
                  $69,707,000    $39,979,000    $29,728,000      74.4%
                  ===========    ===========    ===========

 STATEMENT OF
  OPERATIONS
                                   3 Mos ended       3 Mos ended
                                  March 31, 2003    March 31, 2002
                                  --------------    --------------
 Interest income                    $ 910,000         $ 530,000
 Interest expense                     206,000           129,000
                                    ---------         ---------
 Net interest income                  704,000           401,000
 Provision for loan losses             70,000            35,000
 Other income                         335,000           105,000
 Other expense                        779,000           495,000
                                    ---------         ---------
 Earnings (loss) before
  income taxes                        190,000           (24,000)
 Income taxes (benefit)               (35,000)                0
                                    ---------         ---------
 Net earnings (loss)                $ 225,000          ($24,000)
                                    =========         =========

 Average common shares
  & equivalents outstanding           763,471           761,907
 Basic earnings (loss) per share    $    0.29            ($0.03)
 Diluted earnings (loss) per share  $    0.26            ($0.03)
 Return on average assets
  (annualized)                           1.44%           -0.25%
 Return on average equity
  (annualized)                          13.29%           -1.51%

 SELECTED RATIOS
                                   March 31, 2003    March 31, 2002
                                   --------------    --------------
 Leveraged capital ratio               11.05%            17.00%
 Total risk based capital ratio        14.76%            23.20%
 Allowance for loan losses as a
  percent of total loans                1.20%             1.29%
 Nonperforming assets as a percent
  of total assets                       0.00%             0.00%
 Loan to deposit ratio                 75.44%            75.10%


            

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