LOS ANGELES, CA--(Marketwire - Jan 31, 2013) - 1st Enterprise Bank ("the Bank") (OTCBB: FENB), an independent full-service commercial bank serving the Southern California business community, announced full year net income of $3.7 million for 2012, an 18% increase over 2011.

Financial Highlights

• Net income for 2012 was $3,732,000, an 18% increase over 2011 net income of $3,152,000
• Diluted earnings per common share were $.98 for 2012, compared to $.85 in 2011
• Net income was $1,230,000 for the fourth quarter of 2012, a 28% increase over the fourth quarter of 2011 and a 90% increase over the third quarter of 2012
• Diluted earnings per common share were $.29 for the fourth quarter, compared to $.32 for the fourth quarter of 2011 and $.15 for the third quarter of 2012
• Total Assets grew by 25% in 2012, ending the year at $706 million
• Total Loans outstanding grew by 40% in 2012, ending the year at $409 million
• Total Deposits grew by 23% in 2012, ending the year at $612 million
• The Bank continues to be well capitalized with a Tier 1 Leverage Ratio of 9.4% and Total Risk Based Capital Ratio of 13.2%

John Black, CEO, stated, "We are pleased to announce that 1^st Enterprise Bank achieved record full year earnings of $3.7 million in 2012 and record quarterly earnings of $1.2 million in the fourth quarter. The Bank continued to generate strong growth in both loans and deposits, as loans grew by an annualized rate of 29% and deposits grew by 14%, during the fourth quarter of 2012. Net interest income continued to grow, as reflected in the 25% increase over the prior year. Excluding gain on the sale of securities, the Bank grew non-interest income by 42%. In addition to our strong financial performance during 2012, we also were successful in adding five highly experienced bankers to our team. They included two experienced commercial relationship managers that will open and lead our new San Fernando regional loan production office opening in March of this year."

Net interest income before provision was $18.9 million in 2012, a $3.9 million or 26% increase over the prior year. The growth in net interest income was the result of both growth in earning assets and an increase in net interest margin. Earning assets grew by $93 million or 19% over 2011. Net interest margin increased from 3.03% in 2011 to 3.23% in 2012, as a result of both an increase in the earning asset yield and a decrease in the Bank's cost of funds. The provision for loan loss was $1,508,000 in 2012, a $373,000 increase over 2011. Net loan charge-offs for 2012 and for the fourth quarter totaled $598,000 and non-accrual loans totaled $471,000 at December 31, 2012. "While we were disappointed to have experienced our first charge-off and non-accrual loans (all related to the same borrower), these levels are still far below industry averages, as reflected in the net charge-off ratio of 0.17% for all of 2012 and a non-performing asset ratio of 0.44% at year end," stated Mr. Black.

Non-interest income, excluding gain on sale of securities was $3.1 million in 2012, an increase of more than $900,000 or 42% over 2011. Gain on sale of securities was approximately $900,000 in 2012, a 24% decline from the $1.2 million in gains recorded in 2011.

Non-interest expense grew by $3 million over 2011 to $16 million for 2012. The majority of this growth was attributable to increased staff and benefit expense as the Bank continued to expand its staffing levels to maintain high levels of customer service and to accommodate continued growth in the coming years. 

For the three months ended December 31, 2012, net interest income before provision was $5.1 million, an increase of more than $1 million or 25% compared to the fourth quarter of 2011 and an increase of more than $300,000 or 6% compared to the third quarter of 2012. The growth in net interest income was the result of both growth in earning assets and an increase in net interest margin. Average earning assets were $649 million in the fourth quarter of 2012, a 22% increase over the prior year and a 4% increase from the prior quarter. Net interest margin was 3.13% for the fourth quarter, compared to 3.04% and 3.08% for the prior year and prior quarter, respectively. The increase in net interest margin resulted from both an increase in the earning asset yield and a decrease in the Bank's cost of funds. The provision for loan loss was $513,000 in the fourth quarter of 2012 compared to $565,000 in the fourth quarter of 2011 and $745,000 in the third quarter of 2012.

Non-interest income was $1.4 million in the fourth quarter of 2012, including gains on sale of securities of $629,000. Excluding the gains, non-interest income declined by $36,000 and $194,000 over the prior year and prior quarter, respectively. Non-interest expense in the fourth quarter of 2012 grew by more than $800,000 or 26% over 2011, but grew by only 2% over the third quarter of 2012.

Brian Horton, President, concluded, "We are very pleased with these results and the Bank's ability to successfully navigate the economic headwinds that we have faced the last five years. We want to thank our loyal staff for their efforts and our loyal customers, because they are the drivers of our success."

About 1st Enterprise Bank
Founded in 2006, 1st Enterprise Bank is a full service 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, 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
$000
				Unaudited				Unaudited				Audited
Assets				12/31/2012				9/30/2012				12/31/2011
	Cash and due from banks			$	14,520			$	21,058				17,344
	Interest earning deposits in other banks				23,386				15,357				8,389
		Total cash and cash equivalents			37,906				36,415				25,733
	Certificates of deposit in other banks				2,490				498				5,522
	Investment securities - available-for-sale				180,491				167,518				173,155
	Investment securities - held-to-maturity				56,026				56,114				53,127
	Loans, net of deferred loan fees				408,767				381,307				292,587
	Allowance for loan losses				(5,510	)			(5,595	)			(4,600	)
	Loans, net of allowance for loan losses				403,257				375,712				287,987
	Bank owned life insurance				13,389				13,276				10,462
	Premises and equipment, net				2,256				2,274				2,464
	Accrued interest receivable and other assets				10,323				10,022				8,611
		Total Assets		$	706,138			$	661,829			$	567,061
Liabilities
	Non-interest-bearing demand deposits			$	286,800			$	273,197			$	215,355
	Interest bearing transaction accounts				39,428				43,884				37,075
	Money market and savings accounts				274,088				264,056				233,537
	Time deposits				11,784				10,739				10,976
		Total Deposits			612,100				591,876				496,943
	Federal Home Loan Bank Borrowings				24,000				-				17,000
	Other liabilities				4,647				4,913				2,881
		Total Liabilities			640,747				596,789				516,824
Shareholders' Equity
	Serial Preferred Stock				16,380				16,380				16,380
	Common Stock				43,034				43,008				30,958
	Retained Earnings				4,942				3,752				1,374
	Accumulated other comprehensive income				1,035				1,900				1,525
		Total Shareholders' Equity			65,391				65,040				50,237
Total Liabilities and Shareholders' Equity				$	706,138			$	661,829			$	567,061

1st Enterprise Bank
Condensed Statements of Operations
$000
				For the Years Ended
				Unaudited				Audited
				12/31/2012				12/31/2011
Interest Income
	Interest and fees on loans			$	15,355			$	11,536
	Interest on investment securities				4,141				4,423
	Other interest income				90				149
		Total interest income			19,586				16,108
Interest Expense					723				1,120
Net Interest Income					18,862				14,988
Provision for loan losses					1,508				1,135
Net Interest Income After Provision for Loan Losses					17,355				13,853
Non-interest Income
Service charges, fees and other income					3,138				2,210
Gain on sale of investment sercurities					899				1,177
		Total non-interest Income			4,037				3,387
Non-interest Expenses
	Compensation and benefit expenses				9,663				7,513
	Occupancy and equipment expenses				1,443				1,325
	Data processing				1,007				818
	Professional and legal				1,269				1,226
	Other operating expenses				2,683				2,138
		Total non-interest expense			16,065				13,020
Income Before Income Taxes					5,327				4,220
Provision for income taxes					1,595				1,067
Net Income				$	3,732			$	3,152
Preferred dividends & Warrant amortization					164				655
Net Income Applicable to Common Shareholders				$	3,568			$	2,497
Earnings Per Share
Basic earnings per share				$	1.04			$	0.89
Diluted earnings per share				$	0.98			$	0.85
Average shares outstanding					3,431,886				2,818,497
Average fully diluted shares					3,622,251				2,951,985
Total Shares outstanding at end of period					3,815,089				2,848,500
Capital Ratios
Tier 1 leverage ratio					9.4	%			8.5	%
Tier 1 risk-based capital ratio					12.1	%			12.0	%
Total risk-based capital ratio					13.2	%			13.2	%
Book value per share				$	12.85			$	11.89
Performance Ratios
Return on average assets					0.60	%			0.59	%
Return on average common equity					8.17	%			7.62	%
Net interest margin					3.23	%			3.03	%
Cost of Funds					0.13	%			0.23	%
Efficiency ratio					70.16	%			70.86	%
Average Balances
Total Assets				$	626,527			$	534,397
Earning Assets					584,500				491,909
Total Loans					343,601				245,632
Total Securities					212,171				229,754
Total Deposits					560,741				484,172
Common Equity					43,677				32,774

1st Enterprise Bank
Condensed Statements of Operations
$000
				Three Months Ended
				Unaudited
				12/31/2012				9/30/2012				12/31/2011
Interest Income
	Interest and fees on loans			$	4,291			$	3,957			$	3,150
	Interest on investment securities				963				987				1,136
	Other interest income				23				35				18
		Total interest income			5,277				4,979				4,304
Interest Expense					174				179				231
Net Interest Income					5,103				4,800				4,073
Provision for loan losses					513				745				565
Net Interest Income After Provision for Loan Losses					4,590				4,055				3,508
Non-interest Income
Service charges, fees and other income					733				927				769
Gain on sale of investment sercurities					629				18				0
		Total non-interest Income			1,362				945				769
Non-interest Expenses
	Compensation and benefit expenses				2,543				2,341				1,912
	Occupancy and equipment expenses				364				359				352
	Data processing				268				278				222
	Professional and legal				318				417				368
	Other operating expenses				679				683				451
		Total non-interest expense			4,172				4,078				3,305
Income Before Income Taxes					1,781				922				972
Provision for income taxes					550				273				11
Net Income				$	1,230			$	649			$	961
Preferred dividends & Warrant amortization					41				41				41
Net Income Applicable to Common Shareholders				$	1,189			$	608			$	920
Earnings Per Share
Basic earnings per share				$	0.31			$	0.16			$	0.33
Diluted earnings per share				$	0.29			$	0.15			$	0.32
Average shares outstanding					3,791,905				3,790,359				2,818,500
Average fully diluted shares					4,039,003				4,002,707				2,843,250
Total Shares outstanding at end of period					3,815,089				3,814,539				2,848,500
Capital Ratios
Tier 1 leverage ratio					9.4	%			9.6	%			8.5	%
Tier 1 risk-based capital ratio					12.1	%			12.1	%			12.0	%
Total risk-based capital ratio					13.2	%			13.3	%			13.2	%
Book value per share				$	12.85			$	12.76			$	11.89
Performance Ratios
Return on average assets					0.71	%			0.39	%			0.66	%
Return on average common equity					9.56	%			4.97	%			10.85	%
Net interest margin					3.13	%			3.08	%			3.04	%
Cost of Funds					0.11	%			0.12	%			0.18	%
Efficiency ratio					70.16	%			72.37	%			70.86	%
Average Balances
Total Assets				$	689,361			$	660,792			$	575,479
Earning Assets					648,523				620,656				531,685
Total Loans					389,321				356,425				268,464
Total Securities					222,696				210,271				242,694
Total Deposits					617,678				591,691				521,104
Common Equity					49,473				48,692				33,652