(OTCBB:PFCI) Pacific Commerce Bank

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Pacific Commerce Bank Announces 4th Quarter Results for 2008 and Confirms Receipt of TARP Funds

(OTCBB:PFCI) Pacific Commerce Bank (CA)

Wednesday January 28, 7:07 pm ET

LOS ANGELES-Pacific Commerce Bank , located at 420 E. Third Street, Los Angeles, California, announced its fourth quarter of 2008 results and confirmed receipt of TARP funds. Through December 31, 2008, the Bank has continued to experience healthy growth in total assets, loans and deposits. The Bank?s total assets grew 22% from $152.9 million at December 31, 2007 to $187.2 million at December 31, 2008. For the same period, total loans grew 26% from $120.6 million to $152.0 million and total deposits increased 23% from $120.8 million to $148.0 million. For the year, the Bank reported an operating profit of $460 thousand, prior to setting aside a one-time allocation of $2.0 million for potential future credit problems, resulting in a net loss of $1.54 million.

For the fourth quarter and year ended December 31, 2008, the Bank reported net losses of $2,014,000 and $1,540,000, respectively, compared to last year?s net income of $27,000 and $651,000 for the same reporting periods. The fourth quarter net loss primarily resulted from the aforementioned one-time additional provision of $2,000,000. It is management?s intention to keep the additional loan loss provision to cover credit exposure associated with existing and future credit risk. The net provision will increase the loss reserve as to total loans to 2.72% , an action which management considers prudent in this economy.

The Bank also confirmed that on December 23, 2008, it received $4.06 million in TARP funds from the U.S. Treasury Department?s Capital Purchase Program, which funds were evidenced by 4,060 shares of preferred stock certificates issued by the Bank in favor of the U.S. Treasury, as well as 203 preferred stock certificates which were issued in connection with warrants exercised by the Treasury. The preferred stock certificates bear annual dividend rates of 5% and 9%, respectively, and have terms of ten years. The investment by the Treasury in the Bank was made pursuant to the Private Bank TARP program.

On a year-over-year basis, net interest income and non-interest income increased by $1,145,000 and $124,000, respectively; non-interest expense increased by $1,018,000 and income tax benefits decreased by $475,000. The increase in non-interest expense was related to increases in outside services, personnel, and data processing expenses. The Bank?s operating income before loan loss provision, stock options and income tax benefits was $909,000 compared to $658,000 a year ago, an increase of $251,000 or 38%. The Bank was well-capitalized at year end with Total Risk-Based Capital Ratio of 13.40%, Tier 1 Risk-Based Capital Ratio of 12.13% and Tier 1 Leverage Ratio of 10.27%.

Brian H. Kelley, President and CEO, said, ?The economic outlook has certainly continued to weaken significantly and we feel it prudent to materially increase the loan loss reserve as an additional `cushion' against anticipated as well as unforeseen losses.? Mr. Kelley further stated, ?The timing of the capital infusion from the Treasury helps provide sufficient capital to meet the immediate growth goals of the Bank. We continue to maintain a capital position well in excess of that required by the regulators to be considered a `well capitalized' bank (13.4% versus the minimum 10.0% requirement under the measure of Total Risk-Based Capital).?

Established in 2002, Pacific Commerce Bank is a community bank with offices in Downtown Los Angeles and West Los Angeles. Founded by local business owners and professionals, it is focused on meeting the varied needs of those clients. It is publicly traded on the OTC Bulletin Board under the stock symbol PFCI. The Bank offers small business loans, asset-based loans, construction and permanent real estate financing, SBA government-guaranteed loans, as well as personal and professional credit lines. Information on the Bank as well as a copy of the Bank?s most recent newsletter and financial summary can be accessed through its website: ?www.pacificcommercebank.com? or by calling between 9:00am and 5:00pm at 213-617-0082.

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995:

The financial information in this press release is based on our unaudited financial results. Certain statements in this press release, including statements regarding the anticipated development and expansion of the Bank's business, and the intent, belief, and current expectations of the Bank, its directors, or its officers, are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements are subject to risks and uncertainties and therefore the Bank's actual results may differ materially from those expressed or implied by such forward-looking statements. The risks and uncertainties that the Bank is subject to include, but are not limited to, risks related to the local and national economy, including fluctuations in interest rates and costs and changes in economic policy; the ability of the Bank to perform in accordance with its plans; competition; regulatory matters; and other risks detailed in its filings with the State of California Department of Financial Institutions and the Federal Deposit Insurance Corporation. The Bank cautions readers not to place undue reliance on any forward-looking statements. The Bank does not undertake, and specifically disclaims any obligation, to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.



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