RWCB Redwood Capital Bancorp (QX)

On May 1, 2013, REDWOOD CAPITAL BANCORP (OTCBB:RWCB), the only locally owned and operated community bank holding company in Humboldt County, announced unaudited financial results for the three month period ended March 31, 2013. Redwood Capital Bank, the company's wholly owned subsidiary, celebrated its nine year anniversary by reporting record quarterly profits and robust local loan growth while the Board of Directors approved an increase to its standing quarterly dividend.

John Dalby, President and CEO of the company, remarked, "The Board of Directors and Management are delighted with our excellent start in 2013, particularly with regard to strong profitability and our year-over-year loan growth. We now look forward to opening our Arcata branch and becoming part of that vital community while at the same time, continuing to be aggressive in building new relationships throughout Humboldt County."

Dalby noted that the company's consistent track record of strong performance has not gone unnoticed. For 2012, Redwood Capital Bank has again been awarded the prestigious "Premier Performance" designation by The Findley Reports while also garnering a Bauer Financial rating of "Five Star" for the year. These high marks were earned from two of the most well-known and respected bank rating firms within the industry.

The company again posted strong growth in the major balance sheet categories of assets, loans and deposits. Total assets as of March 31, 2013 were $244.3 million, an increase of 3% from the same period last year. Total loans, net of unearned income, rose to $160.9 million as of March 31, 2013, an increase of 6% over the quarter ended March 31, 2012. Total deposits grew to $218.7 million as of March 31, 2013, an increase of 3% over the March 31, 2012 figure.

Net interest income for the quarter ended March 31, 2012 totaled $2,090,000, up 4% from the $2,019,000 reported for the three months ended March 2012. The company reported record net income after taxes and provision expenses in the first quarter of 2013 of $368,000, up a sharp 23% from the $298,000 reported for the first quarter of 2012. The increase was primarily attributed to increased Fannie Mae loan originations and strong overall credit quality. "Our lending activity continues at a brisk pace. The current marketplace is highly competitive and challenging; one that we are addressing with a focus on value and an unprecedented customer experience. Our lenders have a wide variety of loan products and services they are using to create wonderful solutions for our customers," stated Dalby.

Additionally, the Board of Directors declared a quarterly cash dividend of $0.055 per share, payable on May 14, 2013, to shareholders of record at the close of business on May1, 2013. The dividend represents a 10% increase from the previous quarters and is equivalent to an annual rate of $0.22 per share or 2.83%, based upon a market price of $7.75 per common share. CEO Dalby explained, "We are pleased to announce a dividend increase as a sign of our belief in the financial strength of the company and our confidence in the ability to profitably grow in the future. Our operating results have steadily improved over the last several years and our Board of Directors agreed that it was time to enhance the return to those that have entrusted us with their investment."

For more information regarding Redwood Capital Bancorp, please visit our website at www.redwoodcapitalbank.com, contact Fred Moore, CFO, at (707) 444-9840, or stop by our headquarters and main office at 402 "G" Street, Eureka, California 95501.

This press release may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties may include but are not necessarily limited to fluctuations in interest rates, inflation, government regulations and general economic conditions, and competition within the business areas in which the Bank is conducting its operations, including the real estate market in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

Redwood Capital Bancorp
Selected Consolidated Financial Results - Unaudited
(In Thousands - except share data)
	Period Ended		%
	3/31/2013	3/31/2012	Change
Balance Sheet Data (at period end)
Total assets	$244,302	$236,615	3%
Total deposits	218,733	211,926	3%
Total loans (net)	160,871	151,811	6%
Common equity	14,930	14,008	7%
Common shares outstanding	1,808,382	1,779,320	2%
Summary of Operations (Current Quarter)
Interest income	2,340	2,367	-1%
Interest expense	250	348	-28%
Net Interest Income	2,090	2,019	4%
Non-interest income	407	245	66%
Non-interest expense	1,871	1,716	9%
Net Income before provision	626	548	14%
Provision for loan losses	50	50	100%
Income before taxes	576	498	16%
Income taxes	208	200	4%
Net Income	368	298	23%
Earnings per share (fully diluted)	$0.20	$0.17	21%
Book value per common share	$8.27	$7.87	5%