Redwood Capital Bank Celebrates Tenth Anniversary with Record Profits –Increasing Dividend

EARNINGS RELEASE – April 30, 2014

EUREKA, CALIFORNIA – On April 30, 2014, REDWOOD CAPITAL BANCORP (RWCB.OB), 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, 2014. Redwood Capital Bank, the company’s wholly owned subsidiary, celebrated its ten year anniversary by reporting record profits and robust local loan growth while the Board of Directors announced an increase to its standing quarterly dividend.

John Dalby, President and CEO of the company, remarked, “Management and the Board of Directors are delighted with our excellent start in 2014, particularly with regard to strong profitability and our year over year loan growth. We look forward to serving the Arcata marketplace with the opening of our third branch this summer with the same passion and quality that we are known for in both Eureka and Fortuna.”

The company’s consistent track record of strong performance has not gone unnoticed. For 2013, Redwood Capital Bank has again been awarded the prestigious “Super Premier Performing” designation by The Findley Reports, a publication that provides a comprehensive analysis and evaluation of California’s banking industry. Additionally, Redwood Capital Bank received a 5-Star rating from Bauer Financial; one of the most well-known and respected financial rating agencies within the banking trade.

Redwood Capital Bancorp again posted strong growth in the major balance sheet categories of assets, loans and deposits. Total assets as of March 31, 2014 were $255 million, an increase of 4% from the same period last year. Total loans, net of unearned income, rose to $179.3 million as of March 31, 2014, an increase of 11% over the quarter ended March 31, 2013. Total deposits grew to $228.5 million as of March 31, 2014, an increase of 4% over the March 31, 2013 figure.

Net interest income for the quarter ended March 31, 2014 totaled $2,284,000, up 9% from the $2,090,000 reported for the three months ended March 2013. The company reported record net income after taxes and provision expenses in the first quarter of 2014 of $481,000, up a sharp 31% from the $368,000 reported for the first quarter of 2013. The increase was primarily attributed to improving credit quality and strong cost controls. “Being a community bank means that we serve as an economic foundation for Humboldt County. We operate locally, know the marketplace and put local deposits back to work in Humboldt County through loans to individuals, families and businesses,” stated Dalby.

Additionally, the Board of Directors declared a quarterly cash dividend of $0.06 per share, payable on May 9, 2014, to shareholders of record at the close of business on April 28, 2014. The dividend represents a 9% increase from the previous quarters and is equivalent to an annual rate of $0.24 per share or 2.70%, based upon a market price of $8.90 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 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, 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.