Bank of Marin Announces Stock Dividend and Strong First Quarter Earnings.

CORTE MADERA, Calif. -- Bank of Marin (NASDAQ:BMRC) Chairman Judith O'Connell Allen and President and CEO Robert Griswold announced that earlier today at its regularly scheduled meeting, the Board of Directors approved a resolution declaring a 5% stock dividend. The stock dividend is payable May 2, 2006 to shareholders of record on April 24, 2006. With this announcement, the Bank has declared a shareholder dividend for twelve consecutive years.

Bank of Marin also announced strong first quarter earnings of $2.9 million, an increase of 15.3% over the same period in 2005. Diluted earnings per share were $0.52 in the first quarter of 2006, compared to $0.46 in the first quarter of 2005. These amounts have been restated for the 5% stock dividend declared today.

On January 1, 2006, the company implemented Statement of Financial Accounting Standard No.123R (SFAS 123R), "Share-Based Payment," which requires the Bank to estimate an expense for stock-based compensation, including stock options, and record their fair value as compensation expense in the income statement. Net income for periods prior to January 1, 2006 do not reflect such expenses. For comparability purposes, excluding the effect of SFAS 123R and related tax benefits, earnings per share would have been $0.54 in the first quarter of 2006.

Quarter-end total assets of $843 million represented a 10.69% increase over the $761 million reported at March 31, 2005. Loans and deposits continued their upward trend. Loans totaled $677 million at quarter end, a 13.61% increase over $596 million a year ago. Deposits also showed strong growth, with a 12.06% increase to $740 million from $661 million a year ago. Total loan quality remained strong, with one non-performing loan at quarter end totaling $65 thousand. Net loan charge-offs totaled $35 thousand in the first quarter of 2006.

Net interest income of $10.4 million for the first quarter 2006 increased $1.3 million or 14.2% over the same quarter a year ago. The Bank's net interest margin improved from 5.27% in the first quarter of 2005 to 5.31% in the first quarter of 2006.

Non-interest income in the first quarter 2006 improved by 8.28% from $870 thousand a year ago to $942 thousand, while non-interest expense increased 12.47% from $5.6 million to $6.2 million as the Bank grows and builds infrastructure.

"We are pleased to have opened our eleventh branch in the Redwood Gateway Shopping Center in north Petaluma on April 2, 2006. As our branch network grows, we continue to offer our legendary personal service to all of our clients, which sets us apart from our peers and has contributed to our ongoing financial strength," said Russell Colombo, the Bank's Chief Operating Officer.

This release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact the Bank's earnings in future periods. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words "believe," "expect," "intend," "estimate" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may." Factors that could cause future results to vary materially from current management expectations include, but are not limited to, general economic conditions, changes in interest rates, deposit flows, real estate values, and competition; changes in accounting principles, policies or guidelines; changes in legislation or regulation; and other economic, competitive, governmental, regulatory and technological factors affecting the Bank's operations, pricing, products and services. These and other important factors are detailed in various Federal Deposit Insurance Corporation filings made periodically by the Bank, copies of which are available from the Bank without charge. The Bank undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.

BANK OF MARIN
                         FINANCIAL HIGHLIGHTS
                       Year To Year Comparison
                             Mar 31 2006

FIRST QUARTER          QTR 2006      QTR 2005       CHANGE    % CHANGE
-------------------- ------------- ------------- ------------ --------

  NET INCOME           $2,910,000    $2,523,000     $387,000    15.34%

  DILUTED EARNINGS
   PER SHARE(1)             $0.52         $0.46        $0.06    13.04%

  RETURN ON ASSETS
   (ROA)                     1.40%         1.35%        0.05%    3.70%

  RETURN ON EQUITY
   (ROE)                    14.65%        15.03%       -0.38%    2.53%

AT PERIOD END         Mar 31 2006   Mar 31 2005     CHANGE    % CHANGE
-------------------- ------------- ------------- ------------ --------

  TOTAL ASSETS       $842,599,000  $761,235,000  $81,364,000    10.69%

  TOTAL DEPOSITS     $740,483,000  $660,796,000  $79,687,000    12.06%

  TOTAL LOANS        $676,825,000  $595,723,000  $81,102,000    13.61%

  LOAN LOSS RESERVE
   TO LOANS                  1.08%         1.07%        0.01%    0.93%

  TOTAL
   NONPERFORMING
   LOANS                  $65,000       $83,000     ($18,000) (21.69%)

  SHAREHOLDERS'
   EQUITY             $81,574,000   $68,720,000  $12,854,000    18.70%

  BOOK VALUE PER
   SHARE(1)                $15.46        $13.37        $2.09    15.63%

  TOTAL CAPITAL TO
   ASSETS                    9.68%         9.03%        0.65%    7.20%

  TOTAL RISK BASED
   CAPITAL RATIO            12.06%        11.55%        0.51%    4.42%

(1) Restated 2006 and 2005 for a 5% stock dividend declared April 2006