Regional Bank 1st Capital Shows Loan Growth

California-based regional bank 1st Capital Bank Thursday announced its continued growth, with total assets growing to $114 million since its inception in 2006. But the young bank, as with most in this operating environment, posted a loss in its most recent quarter.

Total assets increased by $44 million or 65 percent from December of last year, and $6 million or six percent, since the quarter ended June 30, 2008.

Loan growth was a main driver of overall asset growth. Loans totaled $86 million in the quarter ended September 30, 2008, including net allowance for loan losses totaling $1 million, an increase of $50 million or 140 percent from the quarter ended December 31, 2007, and $5 million or six percent from the quarter ended June 30, 2008.

Deposits totaled $86 million, an increase of 114 percent from the year-ago quarter, and nine percent from the quarter ended June 30, 2008.

Net operating losses totaled $220,000 for the third calendar quarter of 2008. Net losses decreased $526,000 or 71 percent from the year-ago quarter.

In a press release, Fred Rowden, President and CEO of 1st Capital Bank said, “Asset quality is a major determinant of the viability of any banking institution. Liquidity provides funding for normal bank operations and represents a reserve for unanticipated funding needs while capital provides protection against loss.”

As many larger national banks suffer losses from mortgage investments, many small regional banks are faring well focusing on local lending.

At the end of the most recent quarter, 1st Capital Bank held $12 million in federal funds sold, and has federal funds borrowing lines and other borrowing facilities available as a means to provide additional liquidity and funding for future loan growth.

As of September 30, 2008, 1st Capital Bank had a Total Risk Weighted Capital ratio of 30.4 percent, which was over three times the regulatory required minimum for this ratio.