Record Third Quarter Earnings – Cash Dividend Continued

EARNINGS RELEASE – October 29, 2014

EUREKA, CALIFORNIA – On October 29, 2014, REDWOOD CAPITAL BANCORP (RWCB.OB), the holding company for Redwood Capital Bank, announced unaudited consolidated financial results for three and nine month period ended September 30, 2014. The only locally owned and operated community bank holding company reported record earnings and a continuation of dividend payments during its ninth consecutive year of profitability.

John Dalby, President and CEO of the company, commented, “The Board of Directors, management team and I are pleased to report continued positive earnings and growth. We have a top-notch staff and the results are a direct reflection of their work and dedication. Redwood Capital is banking on Humboldt County and we remain grateful that Humboldt County is banking with us.”

Total assets as of September 30, 2014 were $273.7 million; an increase of 4% over the June 30, 2014 and 9% from the September 30, 2013 reported figures. Total deposits stood at $245.8 million as of September 30, 2014, an increase of 5% over the June 30, 2014 and 9% over the September 30, 2013 figures. The company also reported robust loan growth for the quarter. Total loans as of September 30, 2014, net of unearned income, were $200 million, up 6% from the prior quarter and up 20% over the quarter ended September 30, 2013.

CEO Dalby continued, “The community bank is the economic backbone of rural economies. We take this role seriously and remain committed to helping local business owners create jobs that stimulate our economy. Now more than ever, Humboldt County needs a strong, engaged community bank and Redwood Capital Bank fills that role by providing superior customer service and customized loan products designed for the north coast. We are and will continue to be the attractive choice for customers looking for a true financial partner.”

Net interest income for the three and nine months ended September 30, 2014 totaled $2,772,000 and $7,797,000, respectively, representing an increase of 7% over both the three month ended June 30, 2014 and nine months ended September 30, 2013. The company also reported record net income for the third quarter of 2014 of $633,000 while earnings for the first nine months of 2014 totaled $1,564,000. The earnings represented a 41% increase over the June 30, 2014 quarter and an increase of 9% over the first nine months of 2013. The large increase in net income was attributed to decreasing credit costs, increasing non-interest income and strong net interest margin. Book value per common share, a common measurement of shareholder value, stood at $9.20 as of September 30, 2014, a 3% increase over the previous quarter and a 10% increase over the September 30, 2013 amount.

Additionally, the Board of Directors declared a quarterly cash dividend of $0.06 per share, payable on November 7, 2014, to shareholders of record at the close of business on October 27, 2014. The dividend is equivalent to an annual rate of $0.24 per share or 2.51%, based upon a market price of $9.55 per common share.

For more information regarding Redwood Capital Bancorp, please visit our website at, contact Fred Moore, CFO, at (707) 444-9840, or stop by the headquarters and main office at 402 “G” Street, Eureka, CA 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.