Plaza Bank Reports Results for the Quarter Ended June 30, 2008

SEATTLE--(BUSINESS WIRE)--Plaza Bank (OTCBB:PZBW) is pleased to report its operating results for the quarter ended June 30, 2008.

Total assets increased to $82.8 million from $57.1 million at June 30, 2007, a $25.7 million increase, and $74.0 million at December 31, 2007. Net loans increased to $69.0 million from $41.9 million, an increase of $27.1 million. Net interest income increased to $772 thousand for the six months ended June 30, 2008 from $645 thousand for the comparable period last year.

Plaza Bank reported a loan loss reserve of $1.0 million at June 30, 2008, or 1.45% of total loans, an increase from $319 thousand, or 0.75% of total loans, at June 30, 2007 and $646 thousand, or 1.10% of total loans at December 31, 2007. Plaza placed two loans totaling $1.95 million on non-accrual in the second quarter, $1.90 million of which is secured with commercial real estate in Seattle. While Plaza believes that it has adequately provided for any possible loan loss related to this one loan, it has recently received and reviewed a new appraisal to determine the extent to which the loan may be impaired.

Shareholder Equity at June 30, 2008 totaled $16.1 million, or $7.32 per outstanding share. Plaza Bank trades on the Over the Counter Bulletin Board (OTCBB) under the ticker symbol “PZBW.OB”.

“Unfortunately, the decline in real estate development has impacted us as well,” reports Carlos Guangorena, President & CEO. “We determined that it would be prudent to place the $1.9 million development loan, which we participate with other banks, on non-accrual even though it was not past due. We have received a new appraisal, which values the property securing the loan for more than the loan balance, we have reviewed it and related circumstances carefully and have determined the value of the property in Seattle is supported, and that no additional portion of the loan is impaired and needs to be charged-off at this time.

“We have not had any significant charge-offs at this time and feel confident our reserves are more than adequate. While our loan loss reserve is higher than forecast, we feel it is prudent, based on what we have seen to build our reserve in the current economic environment based on the financial conditions at play in the market.

“On the positive side, Plaza Bank continues to grow and move towards our financial goals. Again we have not been involved directly with the residential or sub-prime lending and feel confident our emphasis on basic commercial business to the local community will continue to pay dividends.”

Please visit www.plazabankwa.com for additional information.

UNAUDITED FINANCIAL HIGHLIGHTS (IN $000’s)
SUMMARY INCOME STATEMENT
		Three Months Ended				Three Months Ended				Six Months Ended				Six Months Ended				Year Ended
		June 30, 2008				June 30, 2007				June 30, 2008				June 30, 2007				Dec. 31, 2007
Interest Income		$	1,182			$	836			$	2,438			$	1,357			$	3,688
Interest Expense			632				335				1,292				467				1,685
Interest Income Before Loan Loss Provision			550				501				1,146				890				2,003
Loan Loss Provision			211				154				374				244				571
Net Interest Income			339				347				772				646				1,432
Non-interest Income			42				20				76				32				91
Non-interest Expense			1,054				865				2,114				1,636				3,791
Net Income (Loss)		$	(673	)		$	(498	)		$	(1,266	)		$	(958	)		$	(2,268	)
SUMMARY STATEMENT OF CONDITION
		June 30, 2008				June 30, 2007				Dec. 31, 2007
Total Assets		$	82,874			$	57,129			$	74,054
Total Loans			69,050				41,985				57,969
Total Deposits			58,477				33,129				54,848
Allowance for Loan Losses			1,020				319				646
Shareholders’ Equity			16,131				18,637				17,447

About Plaza Bank

Plaza Bank, a state chartered commercial bank, is headquartered in Seattle, Washington with a branch office in the Seattle suburb of Kent. The bank was founded in April 2006 with an equity capital base of $22.0 million, at the time the most capital raised by a Washington de novo bank. Plaza Bank is a commercial bank with an emphasis on the Latino market, the first de novo bank in Washington to target the growing Latino market.

Forward Looking Statements

This document contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Those factors include, but are not limited to: the impact of national and regional economic trends on small business loan demand in the Puget Sound area; loan delinquency rates; the Bank’s ability to continue to attract quality commercial business; interest rate movements; changes in the demographic make-up of the Bank’s market area; fluctuation in demand for the Bank’s products and services; the Bank’s ability to attract and retain qualified people, and other factors. These factors should be considered in evaluating the forward-looking statements and undue reliance should not be placed on such statements. The Bank shall not be responsible to update any such forward-looking statements.