3rd Quarter 2011 Shareholders Report (click here for full PDF version with Financial Supplement)

September 30, 2011 —

Dear Shareholders,

Once again we are very excited to share the continued progress and successes at Ojai Community Bank. Our core deposits, earnings, credit administration, and regulatory relationships continue very positively. The economy continues to be slow from an incremental growth standpoint, but we continue to make progress on numerous fronts each day.

Our progress in many areas has resulted in a very positive action on the regulatory front. After only five and a half months our FDIC Consent Order was been lifted on September 16, 2011. This is incredibly positive news and confirms the progress management has been able to make in moving the Bank forward on a healthy solid track.

Total assets of the Bank remain at approximately $125 million at September 30, 2011. Core earnings for the first nine months were approximately $790 thousand, and after a loan loss provision expense of $490 thousand, our net income was $300 thousand. This compares very favorably to the $290 thousand loss for the first nine months of 2010. We believe our allowance for loan loss reserve at 2.66% of total loans provides a sufficient cushion against our current loan portfolio’s credit quality. These financial results confirm the positive trend in core earnings that we have established for future years.

Our Tier 1 Capital Ratio has increased to 8.77% with a goal of 9.5% by year end. As we continue our profitability trend, we feel this goal is very attainable. Our balance sheet continues to be liquid and stable. With good quality loan growth, we can expect stronger earnings in the future.
In the credit administration area, the Bank continues to manage relationships very closely and work with borrowers to resolve situations in an orderly fashion. We do not see additional migration of bad loans at this time and see exit strategies for some of those that challenge us today. Decreasing problem loans is still a top priority.

We continue to be very proud of our local support of the community and working with customers. As we focus on the financial success of the Bank we are very much aware of our social responsibility within the communities we serve. It feels good to help others in these difficult times and you, as a shareholder, are part of the solution and we thank you for that support.
As big banks come under public scrutiny, we believe there will be opportunity for smaller community banks in the near and long term. We are here to answer any questions you may have and encourage you to contact us or stop by if we can be of more help. Contact can be made to Dave Brubaker, President/CEO, at the office located at 402 W. Ojai Ave, Ojai CA 93023, dbrubaker@ojaicommunitybank.com or 805-646-9909.

Sincerely,

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