Community Business Bank Reports Earnings for 2007.

WEST SACRAMENTO, Calif. -- Community Business Bank (OTCBB:CBBC) today reported earnings for 2007 of $134,000, or $.06 per diluted share, compared with a loss of $2.1 million, or -$0.97 per diluted share for the comparable period one year ago. The Bank realized net income of $43,000, or $.02 per diluted share for the fourth quarter ended December 31, 2007, compared with a loss of $361,000, or -$0.17 per diluted share for the comparable period one year ago.

Financial Highlights

* Total loans increased by 45%, or $34 million to $109 million, compared with $75 million in Q4 2006

* Allowance for loan loss was 1.13% of total loans, compared with 1.34% in Q4 2006

* Deposits increased by 43%, or $28 million to $93 million, compared with $65 million in Q4 2006

* Noninterest bearing deposits increased 55%, or $4.5 million to $12.8 million, compared with $8.3 million in Q4 2006

* Other borrowings decreased by 23%, or $1.7 million to $5.5 million, compared with $7.2 million in Q4 2006

Operating Results

Net interest income for the year ending December 2007 increased $1.9 million, or 74% over that of December 2006. Net interest income for the fourth quarter of 2007 increased 36% to $1.2 million compared with the same period in 2006. This improvement was primarily a result of average earning assets increasing by $38 million.

Noninterest income for the year ended December 31, 2007 increased by $717,000, ending the year at $775,000. In the fourth quarter 2007, non-interest income grew by $373,000 to $401,000, compared with the like timeframe in 2006. This growth was primarily due to an increase in other noninterest income related to the sale of the Bank's Lodi branch building and subsequent leaseback. Approximately $300,000 of a $769,000 gain was recognized in the fourth quarter of 2007. An increase in gains on sale of loans was responsible for the majority of the remaining increase.

On a year-to-date basis, noninterest expense increased by $1.0 million to $4.7 million. Noninterest expense rose $357,000 in the fourth quarter of 2007 over the same period in 2006. This reflects higher salaries and employee benefits associated with an increase in the number of staff as well as a full year's occupancy expense related to new Bank facilities. Higher regulatory assessments and data processing expense related to the Bank's growth also contributed to this increase.

The provision for loan losses decreased $653,000 from year-end 2006, ending at $297,000 on December 2007. The provision was down $60,000 in the fourth quarter 2007 to $222,000 from $282,000 in the like period of 2006. Management's assessment of the adequacy of the ALLL takes into consideration changes in loan volumes, concentrations and other qualitative factors including loan growth, which declined in 2007 as compared to 2006.

Net income for the year ended December 31, 2007 totaled $134,000, or $0.06 per diluted share, compared with a loss of $2.1 million, or -$0.97 per diluted share for the corresponding period in 2006. Net income for the quarter ended December 31, 2007 totaled $43,000, or $0.02 per diluted share, compared with a loss of $361,000, or -$0.17 per diluted share for the corresponding period in 2006.

Balance Sheet Summary

As of December 31, 2007, total loans grew by 45% or $34 million to $107 million from $74 million at the end of the fourth quarter of 2006. Construction loans accounted for the largest percentage of the total loan portfolio at 30% of total loans, down from 44% one year ago. The concentration of commercial real estate loans increased slightly to 27%, compared with 25% one year ago.

As of December 31, 2007, the allowance for loan and lease losses (ALLL) was $1.23 million, or 1.13% of gross loans, compared with $1,000,000, or 1.34% of gross loans at the end of the fourth quarter 2006. Management's assessment of the adequacy of the ALLL takes into consideration changes in loan volumes, concentrations and other qualitative factors including loan growth, which declined in 2007 as compared to 2006. The Bank continues to maintain strong asset quality overall, however, Management recognizes that 2008 will pose new credit challenges for which it must be prepared to manage.

Total deposits were $93 million at December 30, 2007 compared with $65 million a year ago. The largest growth was from wholesale and retail certificates of deposit. Wholesale certificates of deposits increased by $29.9 million compared with a year ago. Management has implemented a Liability Management Strategy in order to drive down its cost of funds. Replacement of high-cost promotional retail CDs with wholesale funding is part of the initial phase of this program. Noninterest Bearing DDA increased $4.5 million since December 2006, as calling efforts start to reap benefits. Retail CDs decreased $6.6 million from a year ago, once again primarily due to the run-off of higher-cost "specials" and replacement with alternative funding sources.

Shareholders' equity at December 31, 2007 increased by $300,000 to $19.0 million from $18.7 million a year ago. These increases were primarily due to reaching profitability during 2007 as well as accounting for stock options. The Bank continues to be "well-capitalized" under all regulatory categories.

"We achieved many goals in 2007, one of which was attaining positive earnings for the year," said John DiMichele, President and Chief Executive Officer. "The Bank has been open for just over two years and has accomplished a number of key objectives. We are in the process of gearing the Bank up to grow even further. This is not without its challenges. The current banking environment has been in tremendous turmoil and continues to show signs of weakness in its deposit and loan origination ability.

"The Sub-Prime debacle in the mortgage area has caused rippling effects throughout the financial services industry. Margin compression and weakened credit quality will adversely impact on the banking industry in 2008. Although we are subject to same concerns that the banking industry as a whole must live with in today's setting, we do not originate or hold Sub-Prime mortgages.

"We know 2008 will be a tough year, but as the old saying goes, 'When times are tough, the tough get going,'" stated DiMichele. "We are prepared to compete and take advantages of the market opportunities available to us. We will be successful in 2008."

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The Bank's Call Reports are available for review or download directly from the FDIC website at www.fdic.gov, or through the link at the Bank's website at www.communitybizbank.com.

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 involve known and unknown risks, uncertainties and factors such as: (1) the impact of changes in interest rates, (2) fluctuation in economic conditions, (3) competition in the Company's defined market, (4) the Company's ability to sustain its internal growth rate and to preserve its earning assets quality, and (5) government regulations. Although the Company believes the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct.