Bank of Sacramento Reports Financial Results For Fourth Quarter and Year of 1998.

SACRAMENTO, Calif.--(BUSINESS WIRE)--Jan. 25, 1998--December 31, 1998 marked the end of the first calendar year of operation for the Bank of Sacramento, which opened its doors for business on July 13, 1998. A summarized unaudited balance sheet and income statement is included for your review.

The year end total assets were $28,241,000 or 31% greater than quarter ending September 30, 1998. Net loans grew $3.5 million (56%) during the three-month period from $6.20 million on September 30, 1998 to $9.7 million on December 31, 1998 while deposits closed the year at $18.2 million up $7.2 million (64%) from $11.1 million at the end of the third quarter.

For the fourth quarter of 1998, the bank showed a net operating loss of $500 thousand. That coupled with a third quarter operating loss of $505 thousand resulted in a net operating loss for the year of $1,005,000. This operating loss combined with the 1998 preopening expenses of $447 thousand resulted in a reported net loss of $1,452,000 for the year ended December 31, 1998.

Taking into account both the operating loss and preopening costs, the bank's capital position at year end of $9.9 million represented 35% of total assets.

The loss from operation was expected and is normal for a start up bank which must grow its asset base in order to generate revenues. The most encouraging news for Bank of Sacramento is that loan and deposit growth is trending well.

During the fourth quarter of 1998, two positive trends appear to have materialized which will have a beneficial effect on the bank moving toward profitability. First, significant initial expenses, which were associated with establishing ourselves during our first few months of operation, seem to be behind us. Second, the pace and volume of deposit and loan growth is accelerating as the marketing efforts made by our banking staff and the Directors begin to show results.

The bank continues to mount a concerted marketing effort spearheaded by the Board and management. The marketing strategies are designed to ensure safe and sound growth and to achieve a goal of monthly profitablity.

Forward Looking Statement Disclosure

Statements made in this release may constitute Forward Looking Statements within the meaning of the Private Securities Litigation Reform Act of 1995 and any such statements are subject to risks and uncertainties that could cause actual results to differ materially. Such risks and uncertainties include those related to the economic environment, particularly in the region where Bank of Sacramento operates, competitive products and pricing, general interest rate changes and the fiscal and monetary policies of the US Government, credit risk management, regulatory actions, and other risks and uncertainties. -0-

                          BANK OF SACRAMENTO
                      1998 Financial Highlights
                      (In Thousands)(Unaudited)
                       AS OF DECEMBER 31, 1998

CONDENSED BALANCE SHEET


ASSETS
  Cash and due from banks                           $           836
  Securities, at fair value                                   7,184
  Federal funds sold                                          7,660
  Net Loans                                                   9,745
  Premises and equipment, (net of
   depreciation)                                              1,004
  Other assets                                                1,812
                                                            -------
TOTAL ASSETS                                        $        28,241

LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES
  Deposits
   Noninterest bearing                              $         2,517
   Interest bearing                                          15,724
                                                            -------
   Total Deposits                                            18,241
  Other borrowed funds                                           75
  Other liabilities                                              51
                                                            -------
TOTAL LIABILITIES                                            18,367

SHAREHOLDERS' EQUITY
  Common Stock(a)                                            11,444
  Retained earnings(b)                                       (1,570)
                                                            -------
TOTAL SHAREHOLDERS' EQUITY                                    9,874

TOTAL LIABILITIES & SHAREHOLDERS' EQUITY            $        28,241

(a)Includes $68 thousand of offering expenses incurred in 1998.
(b)Includes $91 thousand of organizational expenses incurred in 1997.

CONDENSED STATEMENT OF INCOME

                                 Results of operation
                                     Three Months        Year to Date
                                 Ending Dec. 31, 1998   Dec. 31, 1998

Net interest income                   $      226         $      364
Provision for possible
 loan losses                                  75                135
                                         -------             -------
Net interest income after
 provision for possible
 loan losses                                 151                229

Noninterest income                             8                  9
Noninterest expense                          659              1,242
Income before taxes                         (500)            (1,004)

Income taxes                                   -                  1
                                         -------             -------
NET INCOME FROM ONGOING OPERATIONS    $     (500)        $   (1,005)

Preopening expense                             -                447(c)

NET INCOME                                  (500)            (1,452)

(c)Includes $447 thousand of organizational expenses incurred in 1998.

The total of the footnotes above equals $606 thousand, preopening and
offering expenses.