Skip to contentSkip to footer

News Room

Press Releases from 2023


November 21, 2023

Exchange Bank Partners with FHLBank San Francisco to Award Dry Creek Rancheria Band of Pomo Indians $70,000 Grant

Santa Rosa, CA – (November 21, 2023) – Exchange Bank has collaborated with the Federal Home Loan Bank of San Francisco (FHLBank San Francisco) and its AHEAD Economic Development Grant Program to provide $70,000 in funding to Dry Creek Rancheria Band of Pomo Indians to promote indigenous self-sufficiency.

The AHEAD program enables FHLBank San Francisco members like Exchange Bank to give a critical boost to local programs and projects that target pressing community needs and bring greater opportunity to underserved populations. The Exchange Bank-sponsored grant will fund Dry Creek Rancheria Band of Pomo Indians, which is a federally recognized tribe in Northern California whose mission is to promote indigenous self-sufficiency through economic development, education, and affordable housing. The project will provide financial education trainings, computer literacy courses for seniors, and a public Wi-Fi hotspot for the community. AHEAD funds will support staff salaries, stipends for clients, computers, and other costs for a community computer lab.

“Exchange Bank is proud to participate in the AHEAD grant program, helping to make a positive impact in our community,” said Shari DeMaris, chief operating officer, Exchange Bank. “It aligns directly with the Bank’s mission of supporting local underserved groups.”

AHEAD grants are awarded annually and delivered through the FHLBank’s member financial institutions to local community organizations for projects and programs that benefit lower-income and underserved communities. Since the program inception in 2004, FHLBank San Francisco has awarded more than $25 million in AHEAD grants to over 800 economic development projects in Arizona, California, and Nevada. In 2023, the FHLBank’s board of directors allocated $4 million to the AHEAD program, more than doubling the funding in prior years, and awarded grants to 75 projects. Exchange Bank applied for the grant in partnership with Dry Creek Rancheria Band of Pomo Indians and was awarded the $70,000 after a competitive selection process.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville, Marin County and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity, and teamwork. Exchange Bank is known for its people who care about their customers, their company, and the communities where they live and work. Exchange Bank is an 18-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2023 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank.  www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer

###

Carolyn Cole-Schweizer
Marketing Services Manager
Exchange Bank
PO Box 403 Santa Rosa, CA 95402
707.541.1250
Carolyn.ColeSchweizer@exchangebank.com


November 13, 2023

Exchange Bank Announces Kelly Back, Vice President, Commercial Relationship Manager

Santa Rosa, CA – (November 13, 2023) – Exchange Bank announces the promotion of Kelly Back to vice president, commercial relationship manager, moving from his previous role as Sebastopol branch manager. In his new role, Kelly will focus on establishing and deepening relationships with commercial lending and commercial real estate customers as well as aligning retail branch and commercial banking activities.

Kelly has over 18 years of local banking experience. He joined Exchange Bank in 2018 and has been making a meaningful difference in the community while establishing connections with local business and community partners, growing branch deposits and loans and served as a member of the Sebastopol Rotary Club and Chamber of Commerce board. He will remain in his current role with the Sebastopol Chamber of Commerce as vice president, board director and plans to help the Sebastopol branch during this time of transition.

Kelly holds a bachelor’s degree in Business Administration and Marketing from Sonoma State University. He is active in the community and enjoys volunteering at community events along with many years of coaching youth sports.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.32 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville, Marin County and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 18-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2023 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank.  www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


October 30, 2023

Contact: Charlotte Radmilovic, SVP, Chief Financial Officer

707.521.3751

Exchange Bank Announces Third Quarter 2023 Earnings

Santa Rosa, CA – (October 30, 2023) – (October 30, 2023) – Exchange Bank (OTC: EXSR) today announced its unaudited financial results for the third quarter of 2023, reporting net income after taxes of $6.34 million, compared with $10.07 million for the same quarter of 2022, a decrease of 36.99% mainly due to the increased costs of deposits and interest expense related to borrowings.

THIRD QUARTER HIGHLIGHTS:

  • In the third quarter, loan growth for the Bank continued with gross loan balances increasing by $43.42 million from June 30, 2023. On a year-to-date basis, the Bank has grown loan balances by $81.20 million or 5.40%.
  • Loan quality remains strong, nonaccrual loans totaled $4.5 million, or 0.28% of gross loans, as of September 30, 2023.
  • The allowance for credit losses, which is based on estimating credit losses for the life of the loans in the portfolio, totaled $41.33 million, or 2.60% of total loans.
  • The Bank had year to date net income after taxes of $13.42 million, compared with $27.84 million for the nine months ended September 30, 2022. The decrease in income is related to a one-time charge of $9.10 million, net of taxes, related to the voluntary termination of the Exchange Bank Pension Plan in the second quarter of 2023 and an increase in cost of funds.
  • The Bank’s liquidity position remains healthy with more than $1.61 billion in available liquidity as of September 30, 2023.
  • The Bank remains well-capitalized, and all capital ratios were well above regulatory requirements with a total risk-based capital ratio of 18.92% on September 30, 2023.

INCOME STATEMENT:
The Bank’s net interest income decreased from $25.99 million during the three months ended September 30, 2022, to $21.54 million for the same period in 2023, a decrease of 17.13%. The decrease in net interest income is due to the increased costs of deposits and interest expense related to borrowings. Total funding costs for the third quarter of 2023 were $7.67 million as compared to $424,000 for the third quarter of 2022. Total funding costs are made up of interest paid to depositors of $5.17 million and $2.50 million paid on borrowings. The cost of deposits increased to 0.71% for the quarter while the cost of total funding increased to 0.99%. In the comparable 2022 quarter, the funding costs were all allocated to interest paid to depositors. The Bank expects funding costs to remain elevated throughout 2023 and into next year. The Bank’s net interest margin decreased from 2.91% in 2022 to 2.75% in 2023; the Bank anticipates the net interest margin will continue to decline throughout the remainder of 2023 as funding costs remain elevated.

The increased interest costs were partially offset by positive trends in interest income. Interest income on assets increased $2.79 million, or 10.56%, from the third quarter of 2022 to $29.20 million for the third quarter of 2023. Interest and fees earned on loans increased $2.86 million in 2023 to $20.91 million for the quarter due to increased volume and repricing of variable rate loans. The increase in loan interest income was offset by a decrease in investment portfolio interest of $0.67 million compared to 2022 due to expected maturities.

Non-interest income for three months ended September 30, 2023, decreased from $6.50 million in 2022 to $5.88 million for the same three-month period in 2023.

Non-interest expenses decreased 0.17% from the quarter ended September 30, 2022, to $18.55 million for the third quarter of 2023. The decrease in non-interest expenses relates to several areas, partially offset by an increase in salary and benefit expense of $183,000 in the third quarter of 2023.

The quality of the Bank’s loan portfolio remains strong; the Bank did not take a provision for loan losses in 2022 nor 2023.

During the nine months ending September 30, 2023, the Bank achieved net earnings of $13.42 million after the one-time charge in the second quarter related to the voluntary termination of the Exchange Bank Pension Plan as, compared with net income of $27.84 million for the same period in 2022. Excluding this one-time charge, earnings from the operations of Exchange Bank for the first nine months of 2023 were $22.47 million.

BALANCE SHEET:
Total assets decreased to $3.36 billion as of September 30, 2023, down from $3.43 billion as of September 30, 2022.

The market value of the investment portfolio was $1.47 billion as of September 30, 2023, down $139 million from one year before and down $59 million from June 30, 2023. The change in investments in the third quarter of 2023 is related to principal payments and maturities totaling $36.10 million and a decrease in the current fair market value of securities of $30.05 million offset by purchases of $7.00 million. Based on current rate conditions; the Bank expects natural portfolio paydowns of approximately $182.75 million through the end of 2024. We continue to maintain our entire portfolio as available for sale, providing full transparency and management flexibility. The Bank’s portfolio has unrealized losses that are a direct result of increases in market interest rates and not a result of credit quality concerns.

Gross loans have increased, ending with $1.59 billion as of September 30, 2023, representing a $87.35 million increase from September 30, 2022. The Bank’s largest loan types are commercial real estate loans making up 39.56% of the portfolio followed by 23.44% in residential loans and 9.68% in multifamily loans. Of the commercial real estate total, approximately 20% or $125.97 million is considered owner occupied and the remaining 80% or $504.53 million are non-owner occupied. The portfolio is well diversified between industries with no significant concentrations, including no material concentration in office space.

Loan quality remains strong, nonaccrual loans totaled $4.50 million, or 0.28% of gross loans, as of September 30, 2023, compared to $3.76 million or 0.25% of gross loans as of September 30, 2022. The allowance for credit losses, which is based on estimating credit losses for the life of the loans in the portfolio, totaled $41.33 million, or 2.60% of total loans. Although the portfolio has grown, the Bank did not book provision expense as there is sufficient allowance for credit losses.

Deposits decreased $281.69 million, or 8.80%, in the 12 months ended September 30, 2023. Since December 31, 2022, deposits have decreased $148.59 million, or 4.85%, ending at $2.92 billion as of September 30, 2023. Deposits increased $81.78 million in the third quarter of 2023, or 2.88%.

Non-interesting bearing deposits made up 35.03% of total deposits as of September 30, 2023, compared to 38.90% as of September 30, 2022. In addition, we estimate approximately 75% of all deposits were fully insured by the FDIC as of September 30, 2023. The Bank’s combined on-balance sheet liquidity and contingent liquidity equate to 224% of the estimated uninsured deposits.

The Bank had borrowings of $175.00 million as of September 30, 2023.

The Bank believes that it is probable it will continue to experience additional runoff of the excess deposits gathered in 2020 and 2021 due to their unusual and short-term nature as they are used to support small business and consumer-related expenses over the next year. In addition, the competition for deposits has increased significantly in 2023. As noted above, with the increased competition for deposits, borrowing levels are likely to remain elevated along with overall funding costs as the Bank continues to be active in the lending market, fulfilling its core mission of providing needed credit facilities to our community.

The Bank’s capital ratios remain well in excess of the regulatory minimums to be considered “well capitalized.” As of September 30, 2023, the Bank reported a total risk-based capital ratio of 18.92%. The Bank’s book equity increased $13.90 million, or 7.33%, since September 30, 2022, to a total of $203.47 million. As previously noted, the unrealized losses on available for sale securities have arisen due to the significant increase in interest rates since the end of 2022. The Bank has the intent and ability to hold the investments until maturity, expects full collection of the carrying amount of these securities, and does not expect to recognize the unrealized losses.

The Bank does not view the temporary nature of the book unrealized losses to be a significant risk to its long-term capital position. The unrealized losses reduce the Bank’s accumulated other comprehensive income, which the Bank has opted to exclude from its common equity tier 1 capital. Therefore, the Bank’s regulatory capital is not impacted by the changes in the market value of the investment securities in the Bank’s investment portfolio. The Bank’s regulatory capital, as defined by the FDIC, was $388.30 million as of September 30, 2023, an increase of $15.05 million, or 4.03%, over the same period in 2022. Since December 31, 2022, regulatory capital has increased $8.04 million, or 2.12%.

On an ongoing basis, the Bank reviews its liquidity sources. As of September 30, 2023, the Bank has more than $1.61 billion in available liquidity. The Bank’s liquidity position was supplemented in March 2023 by the Federal Reserve Bank Term Funding Program (BTFP). While the Bank believes it had more than sufficient liquidity before the formation of the new program, the BTFP provides additional funding flexibility to the Bank as needed.

50.44% of the Bank’s cash dividend goes to the Doyle Trust which funds the Doyle Scholarships at the Santa Rosa Junior College.

###

Forward-Looking Information:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors—many of which are beyond the Company’s control—could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville, Marin County and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity, and teamwork. Exchange Bank is known for its people who care about their customers, their company, and the communities where they live and work. Exchange Bank is an 18-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2023 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank.  www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


October 26, 2023

Contact: Carolyn Cole-Schweizer, Marketing Services Manager

707.541.1250

Exchange Bank Announces AJ Vazquez as Vice President, Branch Manager

Santa Rosa, CA – (October 26, 2023) – On October 26, 2023, Exchange Bank announced AJ Vazquez as vice president and branch manager supporting the St. Francis office at 136 Calistoga Road, Santa Rosa, CA. AJ will report to Thomas Sands, vice president, regional sales manager.

AJ has been in banking for 16 years, most recently working for Umpqua Bank in Novato, where she served on retail advisory committees and was a bank ambassador for their recent merger with Columbia Bank.

As vice president and branch manager of Exchange Bank’s St. Francis branch, AJ looks forward to developing and growing relationships with existing customers, her team, and the community.

Active in the community, AJ volunteers to teach financial literacy classes for middle schoolers and adults at North Marin Community Services. She has also served as Board Director at the Novato Chamber since 2019. She is a Novato Leadership 2019 graduate, has been involved in 10,000 Degrees for college career days, and is team treasurer for Santa Rosa United.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.32 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville, Marin County and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 18-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2023 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


September 6, 2023

Contact: Carolyn Cole-Schweizer, Marketing Services Manager

707.541.1250

Exchange Bank Wins Top Corporate Philanthropist Award for 2nd Straight Year

Santa Rosa, CA – (September 6, 2023) – Exchange Bank is honored to announce that it was named a top corporate philanthropist in the San Francisco Business Times’ annual Top 100 Corporate Philanthropy Companies list. The rankings recognize the financial contributions of corporate citizens in the Bay Area. This was Exchange Bank’s second year in a row to be honored for its contributions to local nonprofits.

Exchange Bank was ranked #46 out of 100, donating $798,000 to 280 nonprofit and charitable organizations in 2022. Exchange Bank’s total income before taxes in 2022 was $50 million, placing the Bank well over the threshold of 1% in cash contributions relative to income before taxes.

“We will continue to strengthen and support nonprofit customers and partnerships in our markets to help make a sustainable, lasting impact in our community,” said Beth Ryan, Community Engagement Officer.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.32 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville, Marin County and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is an 18-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2023 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


July 26, 2023

Contact: Shari DeMaris, EVP, Chief Financial Officer

707.524.3067

Exchange Bank Announces Second Quarter 2023 Results; Declaration of Third Quarter Cash Dividend

Santa Rosa, CA – Exchange Bank (OTC: EXSR) today announced results for the second quarter of 2023, reporting a net loss after taxes of $2.14 million. The net loss is after a one-time charge of $9.10 million, net of taxes, related to the voluntary termination of the Exchange Bank Pension Plan (the “Plan”). Excluding this one-time charge, recurring net earnings from the operations of Exchange Bank for the second quarter of 2023 were $6.96 million as compared with net earnings of $9.52 million for the same quarter of 2022.

With this level of core profitability, on July 18, 2023, the Board of Directors of the Bank declared a third quarter dividend of $1.30 per share, the same amount as paid in the prior quarter of 2023, payable on September 15, 2023, to shareholders of record as of September 1, 2023.

The Bank booked this one-time after-tax expenditure of $9.10 million in connection with fully retiring and settling all of its obligations to retirees and certain active employees who were once a part of the now terminated Plan. Mr. Sanderson remarked, “Similar to decisions made over the years by many other companies, this long-contemplated action by the Bank to terminate the Plan, which was initiated in mid-2022, follows 70 years of managing through complex and costly accounting and regulatory Plan requirements. The Bank believes this action now eliminates all future actuarial and regulatory risks for the Bank related to the Plan, as well as the administrative expenses to manage it.” All former Plan members were made completely whole through either lump-sum distributions or the provision of individual annuities.

Through the reversal of certain accruals and tax treatments related to the Plan, the Bank’s final net adjustment to capital specifically related to the Plan’s termination was a negative $3.2 million. The Bank believes this one-time reduction of Bank capital, equal to less than 1% of the Bank’s current total regulatory capital, will likely be offset in the coming years by savings tied to the elimination of the costs to administer the Plan. Further, the Bank believes that termination of the Plan eliminates the risk of any future monetary contributions that could be required by the Bank due to negative future changes in the market value of the assets that were held in the Plan. After the one-time charge related to the Plan termination, and as of June 30, 2023, the Bank reported a total risk-based capital ratio of 18.86% and a leverage ratio of 10.30%. Both ratios are well in excess of  minimums to be considered “well-capitalized” for regulatory purposes.

 The Bank’s net interest income decreased from $24.54 million during the three months ended June 30, 2022, to $22.83 million for the same period in 2023, a decrease of 7%. The decrease in net interest income is due to the increased costs of deposits and interest expense related to borrowings. Total funding costs for the second quarter of 2023 were $5.78 million as compared to $407,000 for the second quarter of 2022. Total funding costs are made up of interest paid to depositors of $3.41 million and $2.37 million paid on borrowings. The cost of deposits increased to 0.47% for the quarter while the cost of total funding increased to 0.76%. In the comparable 2022 quarter, the funding costs were all allocated to interest paid to depositors. The Bank expects funding costs to remain elevated throughout 2023. The Bank’s net interest margin increased from 2.80% in 2022 to 3.07% in 2023; however, the Bank anticipates the net interest margin will decline throughout the remainder of 2023 as funding costs remain elevated.

 The increased interest costs were partially offset by positive trends in interest income. Interest income on assets increased $3.65 million, or 14.64%, from the second quarter of 2022 to $28.60 million for the second quarter of 2023. The investment portfolio interest grew to $8.21 million which was a $0.97 million increase in 2023 compared to 2022. Interest and fees earned on loans increased $2.69 million in 2023 to $20.39 million for the quarter due to repricing of variable rate loans. These positive changes in loan yields were somewhat offset by a decrease in PPP loan fees of $1.1 million from 2022 to 2023.

 Non-interest income for three months ended June 30, 2023, decreased from $6.1 million in 2022 to $5.8 million for the same three month period in 2023.

 Non-interest expenses increased 9.79% from the quarter ended June 30, 2022, to $19.18 million for the second quarter of 2023. The increase in non-interest expenses relates to several areas. Salary and benefit expense increased $1.1 million in the second quarter of 2023. Software and professional fees related to technology increased $544,000 during the same three-month period.

 The quality of the Bank’s loan portfolio remains strong; the Bank did not take a provision for loan losses in 2022 nor 2023.

Total assets decreased to $3.32 billion as of June 30, 2023, down from $3.47 billion as of June 30, 2022.

The market value of the investment portfolio was $1.533 billion as of June 30, 2023, down $100 million from one year before and down $62 million from March 31, 2023. The change in investments in the second quarter of 2023 is related to principal payments totaling $44.36 million and a decrease in the current fair market value of securities of $17.64 million. Based on current rate conditions, the Bank expects natural portfolio paydowns of approximately $221 million through the end of 2024. We continue to maintain our entire portfolio as available for sale, providing full transparency and management flexibility.

Gross loans have increased ending with $1.55 billion as of June 30, 2023, representing a $24.01 million increase from June 30, 2022.

Deposits decreased $367.76 million, or 11.48%, in the 12 months ended June 30, 2023. Since December 31, 2022, deposits have decreased $230.36 million, or 7.51%, ending at $2.836 billion as of June 30, 2023. Deposits decreased $83.21 million in the second quarter of 2023, or 2.85%. While there was initially some deposit outflow due to industry concerns in March 2023, the Bank believes the majority of deposit outflows have been related to the expected use of excess deposits, rate competition and normal business activities.

Non-interesting bearing deposits made up 36.53% of total deposits as of June 30, 2023, compared to 38.18% as of June 30, 2022. In addition, we estimate approximately 74% of all deposits were fully insured by the FDIC as of June 30, 2023.

The Bank had borrowings of $207 million as of June 30, 2023.

The Bank believes that it is probable it will continue to experience additional runoff of the excess deposits gathered in 2020 and 2021 due to their unusual and short-term nature as they are used to support small business and consumer-related expenses over the next year. In addition, the competition for deposits has increased significantly over the first two quarters of 2023. As noted above, with the increased competition for deposits, borrowing levels are likely to remain elevated along with overall funding costs as the Bank continues to be active in the lending market, fulfilling its core mission of providing needed credit facilities to our community.

During the six months ending June 30, 2023, the Bank achieved net earnings of $7.08 million after the one-time charge related to the termination of the Plan as, compared with net income of $17.78 million for the same period in 2022. Excluding this one-time charge, earnings from the operations of Exchange Bank for the first six months of 2023 were $16.18 million. The change in operating income was driven mainly by changes in net interest income as described previously. Net interest income increased $0.65 million from $46.92 million for the six months ended June 30, 2022, to $47.57 million for the same period in 2023. $2.19 million of PPP loan fees are included in 2022 net interest income. Interest income on investments increased $3.44 million to $16.36 million in the first six months during 2023. For the 2023 period, interest and fee income on loans increased $4.86 million to a total of $39.67 million. Offsetting these increases in interest income was an increase in interest expense of $7.65 million in the first six months of 2023. This increase in interest expenses is due to increased rates paid to customers on deposit accounts of $4.09 million and $3.56 million related to borrowings. The cost of deposits increased to 0.34% year-to-date while the cost of total funding increased to 0.56%.

The Bank’s capital ratios remain well in excess of the regulatory minimums to be considered “well capitalized.” As reported previously, as of June 30, 2023, the Bank reported a total risk-based capital ratio of 18.86%. The Bank’s book equity decreased $16.28 million, or 6.89%, since June 30, 2022, to a total of $220.02 million. As previously noted, the unrealized losses on available for sale securities have arisen due to the significant increase in interest rates since the end of 2022 and account for $34.99 million of the decrease. The Bank has the intent and ability to hold the investments until maturity, expects full collection of the carrying amount of these securities, and does not expect to recognize the unrealized losses.

The Bank does not view the temporary nature of the book unrealized losses to be a significant risk to its long-term capital position. The unrealized losses reduce the Bank’s accumulated other comprehensive income, which the Bank has opted to exclude from its common equity tier 1 capital. Therefore, the Bank’s regulatory capital is not impacted by the changes in the market value of the investment securities in the Bank’s investment portfolio. The Bank’s regulatory capital, as defined by the FDIC, was $358.31 million as of June 30, 2023, an increase of $18.04 million, or 5.30%, over the same period in 2022. Since December 31, 2022, regulatory capital has increased $2.62 million, or 0.74%.

On an ongoing basis, the Bank reviews its liquidity sources. As of June 30, 2023, the Bank has more than $1.79 billion in available liquidity. The Bank’s liquidity position was supplemented in March 2023 by the Federal Reserve Bank Term Funding Program (BTFP). While the Bank believes it had more than sufficient liquidity before the formation of the new program, the BTFP provides additional funding flexibility to the Bank as needed.

With respect to the cash dividend declared by the Board, 50.44% of the Bank’s cash dividend goes to the Doyle Trust which funds the Doyle Scholarships at Santa Rosa Junior College.

###

Forward-Looking Information:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking statements about the Bank, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings, or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Bank’s control — could cause actual conditions, events, or results to differ significantly from those described in the forward-looking statements. These factors include: local, regional, national and international economic conditions and events, including the effects of recent bank failures, and the impact they may have on us and our customers, and in particular in our market areas; the effects resulting from termination of the Plan; our ability to attract deposits and other sources of liquidity; our ability to maintain adequate liquidity levels; oversupply of property inventory and deterioration in values of California real estate, both residential and commercial;  premature payoffs in our loan portfolio; a prolonged slowdown or decline in construction activity; changes in the financial performance and/or condition of our borrowers; changes in the level of non-performing assets and charge-offs; the cost or effect of acquisitions or dispositions we have made or we may make in the future;  the effect of changes in laws and regulations (including laws, regulations and judicial decisions concerning financial reform, capital requirements, taxes, banking, securities, employment, executive compensation, insurance, and information security) with which we must comply; changes in estimates of future reserve requirements and minimum capital requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; inflation, interest rates, securities market and monetary fluctuations; cyber-security threats including loss of system functionality, or theft, or loss of data; political instability;  acts of war or terrorism, or natural disasters, such as earthquakes, or the effects of pandemic disease (including Covid-19) and flu; destabilization in international economies; the timely development and acceptance of new banking products and services and perceived overall value of these products and services by users; changes in consumer spending, borrowing and savings habits; technological changes; the ability to increase market share, retain customers and control expenses;  our ability to attract and retain key management and personnel; changes in the competitive environment among financial and bank holding companies and other financial service providers; volatility in the credit and equity markets and its effect on the general economy; changes in interest rates; the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board and other accounting standard setters; changes in our organization, management, compensation and benefit plans, and our ability to retain or expand our management team; the costs and effects of legal and regulatory developments including the resolution of legal proceedings, or regulatory, or other governmental inquiries and the results of regulatory examinations or reviews; our success at managing the risks involved in the foregoing items.

Forward-looking statements speak only as of the date they are made. The Bank does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made except as required by law.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.32 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville, Marin County and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2023 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank.  www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer

###
Troy Sanderson
President & CEO, Exchange Bank  |  707.524.3111
Shari DeMaris
EVP, Chief Operating Officer, Exchange Bank  |  707.524.3067

June 26, 2023

Contact: Carolyn Cole-Schweizer, Marketing Services Manager

707.541.1250

Exchange Bank Welcomes Debbie Campas, Vice President, Personal Trust Officer to their new Trust & Investment Management Office in Marin

Santa Rosa, CA – Exchange Bank welcomes Debbie Campas, VP, personal trust officer, reporting to Emily Menjou, VP, trust fiduciary manager. Debbie will be based at their new Trust & Investment Management Office in Marin working with Bill Ryan, VP, investment officer, managing customer relationships and developing the Bank’s presence in that market.

Debbie has over 30 years in the financial services industry. She worked as a real estate appraiser at Great Western Savings & Loan, a sales and client service assistant for financial advisors at Linsco Private Ledger, and as a client services manager for a commodities fund company at Phoenix American Financial Service. Her most recent position was with Bank of Marin in the Wealth Management & Trust Department as a trust officer, vice president.

Debbie graduated with a bachelor’s degree in Economics from California State University, Northridge. She completed her CTFA designation from the American Bankers Association, Trust levels, I, II and III from Cannon Financial Institute, State of California real estate brokers license, and is a graduate of Novato Chamber of Commerce Leadership class of 2022.

Debbie has lived in Novato for 35 years and has been actively involved in local school and sports activities for 30 years. Debbie is an active parishioner of St. Anthony’s of Padua Catholic Church where she serves as a finance council member..

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity, and teamwork. Exchange Bank is known for its people who care about their customers, their company, and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank 2023 by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


June 26, 2023

Contact: Carolyn Cole-Schweizer, Marketing Services Manager

707.541.1250

Exchange Bank Announces Paul Yeomans as Senior Vice President, Senior Lending Officer

Santa Rosa, CA – Exchange Bank announces the expansion of Paul Yeomans’ role from SVP, wholesale banking sales manager to SVP, senior lending officer, combining the Commercial Banking and Construction and Mortgage Lending departments into a single commercial lending origination force under his executive leadership. This includes Exchange Bank’s Roseville Commercial team and SBA loan production.

Paul joined Exchange Bank in 2018. His extensive local knowledge, coupled with his 30 years of experience in commercial lending within Sonoma County, make him exceptionally well-suited for this expanded role. He will lead the commercial lending department, fostering a “team approach” to build strong relationships to meet customer needs, and establishing strong collaborations with other Bank departments.

Paul is active in the local community. He has lived in Sonoma County since 1990 and in West County since 1992. He is a previous board chair of the Santa Rosa Junior College Foundation, a member of the Sebastopol Rotary Club, and a board member of North Coast Builders and Sonoma County Alliance.

Paul is a graduate of American University with a degree in Economics, holds a master’s degree in business from Golden Gate University and is a graduate of Pacific Coast Banking School.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank 2023 by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


June 21, 2023

Contact: Carolyn Cole-Schweizer, Marketing Services Manager

707.541.1250

Exchange Bank’s Shari DeMaris Takes on New Role as Executive Vice President and Chief Operating Officer

Santa Rosa, CA – On June 21, 2023, Exchange Bank announced the transition of EVP and Chief Financial Officer Shari DeMaris to a new role as EVP, chief operating officer. Still reporting to Troy Sanderson, president and chief executive officer, DeMaris will manage the daily business operations of the Bank, working closely with department heads to implement company strategies and oversee daily operations.

Ms. DeMaris joined Exchange Bank in October 2020, serving as EVP, chief financial officer. Her impressive executive management skills and her contributions in that capacity make her an excellent fit for this new role.

Shari has over 25 years of technical accounting and financial leadership experience and is a licensed CPA with bachelor’s degrees in both Accounting and Spanish from DePaul University and the University of Iowa, respectively.

Active in the community, Shari serves on the board of the Santa Rosa Symphony and was honored to receive the 2023 North Bay Business Journal’s “Influential Women Award.”

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank 2023 by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


June 21, 2023

Contact: Carolyn Cole-Schweizer, Marketing Services Manager

707.541.1250

Exchange Bank Announces Charlotte Radmilovic, Senior Vice President, Chief Financial Officer

Santa Rosa, CA – On June 21, 2023, Exchange Bank welcomed Charlotte Radmilovic, senior vice president and chief financial officer, reporting to Troy Sanderson, president and chief executive officer. Charlotte will work closely with all areas of the Bank, overseeing all financial activities and initiatives.

Charlotte is a seasoned financial professional with over 15 years of experience in the banking and financial industries. She most recently served as executive vice president, chief financial officer for Pacific Valley Bank in Monterey County. Prior to this, she was the director of finance for Summit Funding Inc. in Sacramento, chief accounting officer for Rabobank, N.A. in Roseville, and held other key roles in the industry.

Charlotte attended Saint Mary’s College of California and holds a degree in Business Administration, Accountancy. She is passionate about community involvement and has served as a volunteer board member and held leadership roles for the Keaton’s Child Cancer Alliance, Blue Line Arts, the Monterey State Historic Parks Association, the Arts Council for Monterey County, and the Hospice Giving Foundation.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank 2023 by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


May 23, 2023

Contact: Shari DeMaris, EVP, Chief Financial Officer

707.524.3067

Exchange Bank Declares Second Quarter 2023 Cash Dividend

Santa Rosa, CA – (May 23, 2023) – On May 16, 2023, the Exchange Bank Board of Directors declared a quarterly cash dividend of $1.30 per share on common stock outstanding to shareholders of record at the close of business on June 2, 2023. The dividend is payable on June 16, 2023. The cash dividend is unchanged from the prior quarter.

50.44% of the Bank’s cash dividend goes to the Doyle Trust which funds the Doyle Scholarships at the Santa Rosa Junior College.

###

Forward-Looking Information:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company’s control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2023 and the Bohemian Magazine’s Best of the North Bay 2023 named Exchange Bank Best Business Bank and Best Consumer Bank.  www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


April 27, 2023

Contact: Shari DeMaris, EVP, Chief Financial Officer

707.524.3067

Exchange Bank Announces First Quarter 2023 Earnings

Santa Rosa, CA – Exchange Bank (OTC: EXSR) today announced results for the first quarter of 2023, reporting net income after taxes of $9.22 million, compared with $8.26 million for the same quarter of 2022, an increase of 11.57%.

The Bank’s net interest income increased from $22.38 million during the three months ended March 31, 2022 to $24.75 million the same period in 2023, an increase of 10.57%. The increase in interest income is due in large part to a growth in core earning assets. The investment portfolio interest grew to $7.98 million which was a $2.47 million increase in 2023 compared to 2022. Interest earned on loans increased $3.48 million in 2023 to $19.28 million for the quarter due to repricing of variable rate loans. These positive changes were somewhat offset by a decrease in PPP loans fees of $1.14 million from 2022 to 2023 and an increase in funding costs.

Total funding costs for the first quarter of 2023 were $2.68 million vs. $401,000 for the first quarter of 2022. The Bank expects funding costs to remain elevated throughout 2023. The Bank’s net interest margin increased from 3.01% in 2022 to 3.21% in 2023.

Non-interest income remained flat with $6.1 million in 2022 to $6.0 million in 2023. An OREO property sold in the first quarter of 2023 for a gain of $672,000. This was offset by a decrease of $605,000 in income generated by the Bank’s Trust Department resulting from overall subdued market conditions.

Non-interest expenses increased 5.98% from 2021 to $18.12 million for 2023. The increase in non-interest expenses relates to several areas. Salary and benefit expenses increased $168,000 for 2023. Software and professional fees related to technology have increased $506,000 to $3.73 million for 2023.

The quality of the Bank’s loan portfolio remains strong; the Bank did not take a provision for loan losses in 2022 nor 2023.

Total assets decreased to $3.36 billion as of March 31, 2023, down from $3.54 billion as of March 31, 2022. The Bank’s cash position has normalized at $51 million which is down $257 million from March 31, 2022.

The investment portfolio was $1.594 billion as of March 31, 2023 vs. $1.61 billion one year before. The market value of the investment portfolio remains relatively unchanged since December 31, 2022 when it was $1.592 billion. The change in investments in the first quarter of 2023 is related to principal payments totaling $28.47 million and an improvement in the fair market value of securities of $31.18 million. Based on current rate conditions, the Bank expects natural portfolio paydowns of approximately $263 million through the end of 2024. We maintain our entire portfolio as available for sale, providing full transparency and management flexibility.

Gross loans have increased ending with $1.53 billion as of March 31, 2023. This represents loan growth of $38.88 million over March 31, 2022. The change in loans was composed of core loan growth of $69.83 million offset by a decrease of $30.95 million from forgiveness of PPP loans.

Deposits decreased $316.99 million, or 9.80%, in the 12 months ended March 31, 2023. Since December 31, 2022, deposits have decreased $147.15 million, or 4.80%, ending the quarter at $2.919 billion. While there has been some deposit outflow due to industry concerns in March 2023, the majority of deposit outflows have been related to the expected use of excess deposits, rate competition and normal business activities.

Non-interest bearing deposits made up 37.97% of total deposits as of March 31, 2023 compared to 38.22% as of March 31, 2022. In addition, we estimate that 68% of all deposits were fully insured by the FDIC as of March 31, 2023.

To offset the decrease in deposits, the Bank had borrowings of $155 million as of March 31, 2023.

It is probable that the Bank will continue to experience additional runoff of the excess deposits gathered in 2020 and 2021 due to their unusual and short-term nature as they are used to support small business and consumer-related expenses over the next year. In addition, the competition for deposits has increased significantly over the month of March 2023. As noted above, with the increased competition for deposits, borrowing levels are likely to remain elevated along with overall funding costs.

The Bank’s capital ratios remain well in excess of the regulatory minimums to be considered “well capitalized.” As of March 31, 2023, the Bank reported a total risk-based capital ratio of 20.56%. The Bank’s book equity decreased $38.93 million, or 14.42%, since March 31, 2022, to a total of $230.97 million. The unrealized losses have arisen due to the significant increase in interest rates since the end of 2021. The Bank has the intent and ability to hold the investments until maturity, expects full collection of the carrying amount of these securities, and does not expect to recognize the unrealized losses.

The Bank does not view the temporary nature of the unrealized losses to be a significant risk to its long-term capital position. The unrealized losses reduce the Bank’s accumulated other comprehensive income, which the Bank has opted to exclude from its common equity tier 1 capital. Therefore, the Bank’s regulatory capital is not impacted by the changes in the market value of the investment securities in the Bank’s investment portfolio. The Bank’s regulatory capital, as defined by the FDIC, was $362.67 million as of March 31, 2023, an increase of $29.86 million, or 8.97%, over the same period in 2022. Since December 31, 2022, regulatory capital has increased $6.99 million, or 1.96%.

On an ongoing basis, the Bank reviews its liquidity sources. As of March 31, 2023, the Bank has in excess of $1.7 billion in available liquidity. The Bank’s liquidity position was supplemented in March 2023 by the new Federal Reserve Bank Term Funding Program. While the Bank had more than sufficient liquidity before the formation of the new program, the BTFP provides additional funding flexibility to the Bank. The Bank’s available liquidity sources account for 59% of total deposits and 184% of estimated uninsured deposits as of March 31, 2023.

50.44% of the Bank’s cash dividend goes to the Doyle Trust which funds the Doyle Scholarships at the Santa Rosa Junior College.

###

Forward-Looking Information:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company’s control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.36 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2022 and the Bohemian Magazine’s Best of the North Bay 2022 named Exchange Bank Best Business Bank and Best Consumer Bank.  www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


February 27, 2023

Contact: Shari DeMaris, EVP, Chief Financial Officer

707.524.3067

Exchange Bank Declares First Quarter 2023 Cash Dividend

Santa Rosa, CA – (February 27, 2023) – On February 22, 2023, the Exchange Bank Board of Directors declared a quarterly cash dividend of $1.30 per share on common stock outstanding to shareholders of record at the close of business on March 6, 2023. The dividend is payable March 17, 2023. The cash dividend increased $0.05 from the prior quarter’s dividend of $1.25 per share.

50.44% of the Bank’s cash dividend goes to the Doyle Trust which funds the Doyle Scholarships at the Santa Rosa Junior College.

###

Forward-Looking Information:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company’s control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.33 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2022 and the Bohemian Magazine’s Best of the North Bay 2022 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer

February 15, 2023

Exchange Bank Employees Deliver Community Support through Nonprofit Board Membership

Santa Rosa, CA – (February 15, 2023) – Exchange Bank (OTC: EXSR) is pleased to announce the appointment of four employees to Sonoma County-based nonprofit boards. Supporting the community is the cornerstone of Exchange Bank’s culture, and employees donate thousands of hours a year in support of local charities and nonprofit organizations.

Shaun Vongphakham, vice president, branch manager of the St. Francis branch, joined the board of the Sonoma County Regional Parks Foundation, which sponsors park programs for under-served communities, seniors and youth, supports the development of environmental education programs, funds natural resources projects to restore habitats and protect wildlife, and provides financial support to develop new parks and trails.

Chad Barbieri, vice president, SBA business development officer, joined the board of TLC Child and Family Services, supporting vulnerable youth and families during their greatest time of need through comprehensive, quality foster care and adoption services, residentially-based services, special education services, transition age youth housing and counseling.

Stacey Powers, vice president, commercial relationship manager, has been appointed to the Sonoma County Fair and Exposition Board, representing District 2, which includes Petaluma, Penngrove and Cotati. Nominated by Supervisor David Rabbitt, Stacey’s appointment was approved at the County of Sonoma Board of Supervisors’ meeting on December 6, 2022.

Carolyn Cole-Schweizer, marketing services manager, joined the board of 6th Street Playhouse, which creates theatre and programs that engage, inspire and educate Sonoma County’s diverse community through professional, quality productions and educational programs.

“Exchange Bank is an integral part of the local community, and giving our time and expertise to nonprofits is a big part of how we give back. We currently have 60 Exchange Bank employees who serve on nonprofit boards, and our employees as a whole volunteer with over 250 organizations,” said Beth Ryan, Exchange Bank’s community engagement officer.


February 7, 2023

Contact: Carolyn Cole-Schweizer, Marketing Services Manager

707.541.1250

Exchange Bank’s Trust & Investment Management Expands into Marin County

Santa Rosa, CA – February 7, 2023 – Exchange Bank (OTC: EXSR) announces the expansion of their Trust and Investment Management services into Marin County. Their new office will be located near the Marin Civic Center at 3950 Civic Center Drive in San Rafael and will open this summer. Exchange Bank has been offering full-service Trust and Investment Management services for 60 years in Sonoma County and has one of the largest community bank trust departments in California with over $1.3 billion in assets under administration.

Emily Menjou, vice president, personal trust fiduciary manager, will initially head up the new office, bringing 20 years of experience in trust administration and estate settlement. Menjou is a recent recipient of the American Banking Association’s Under 40 Wealth Management Award, which recognizes wealth management and fiduciary professionals who are committed to the highest standards of achievement at work and in their communities. Exchange Bank plans to expand the team with experienced local professionals in Marin County.

“We are excited to bring our community banking style of fiduciary services and investment management to Marin County,” said Troy Sanderson, Exchange Bank, president and CEO.  “We look forward to forging strong relationships with families and businesses in Marin County.”

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.33 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2022 and the Bohemian Magazine’s Best of the North Bay 2022 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


January 31, 2023

Contact: Shari DeMaris, EVP, Chief Financial Officer

707.524.3067

Exchange Bank Announces Fourth Quarter and Year Ending 2022 Earnings

Santa Rosa, CA – Exchange Bank (OTC: EXSR) today announced results for the fourth quarter and year ending 2022, reporting net income after taxes of $9.64 million in the fourth quarter of 2022, compared with $9.85 million for the same quarter of 2021, a decrease of 2.16%. The Bank achieved net income for the year of $37.48 million, compared to $36.41 million in 2021, an increase of 2.94%.

The Bank’s net interest income increased from $93.55 million during the 12 months ended December 31, 2021 to $99.14 million the same period in 2022, an increase of 5.97%. The increase in interest income is due in large part to a growth in core earning assets and interest income earned on the Bank’s investment portfolio. The investment portfolio interest grew to $29.77 million which was a $12.35 million increase in 2022 compared to 2021. In addition, interest earned on fed funds increased $1.22 million in 2022. These positive changes were offset by a decrease in PPP loans fees of $6.61 million from 2021 to 2022. The Bank’s net interest margin increased from 2.87% in 2021 to 3.01% in 2022.

Non-interest income increased from $23.65 million in 2021 to $24.37 million in 2022. This improvement can be attributed to a life insurance benefit of $800,000 and an increase of $1.42 million in consumer and business-related usage fees including interchange fees and ATM network fees. These improvements were offset by a decrease of $776,000 in income generated by the Bank’s Trust & Investment Management resulting from overall market conditions.

Non-interest expenses increased 13.57% from 2021 to $73.42 million for 2022. The increase in non-interest expenses relates to several areas. Salary and benefit expense increased $4.66 million for 2022 as compared to 2021. The Bank was able to fill open positions during 2022 and provided cost of living and annual pay adjustments for its employees. Software and professional fees related to technology have increased $2.50 million to $14.24 million for 2022. In 2021, the Bank utilized credits of $1.2 million from its core conversion to offset these expenses.

The quality of the Bank’s loan portfolio remains strong; the Bank did not take a provision for loan losses in 2022. There was a provision for loan losses of $2 million in 2021.  

Total assets decreased to $3.33 billion as of December 31, 2022, down from $3.54 billion at the end of 2021. The Bank’s cash position has normalized at $48 million which is down $425 million from $473 million in 2021.

The investment portfolio was $1.58 billion as of December 31, 2022 vs. $1.41 billion one year before. Gross loans remained stable ending with $1.51 billion for both 2021 and 2022. Overall, loan balances decreased $199,000. The change in loans was composed of core loan growth of $57.48 million offset by a decrease of $57.68 million from forgiveness of PPP loans.

Deposits decreased 3.55% in 2022 to a total of $112.84 million, ending 2022 at $3.07 billion as compared to $3.18 billion as of December 31, 2021. The decrease in deposits has been spread among all account types with demand deposit accounts decreasing $62.18 million, money market accounts decreasing $28.23 million and certificates of deposit decreasing $21.80 million. Savings accounts balances have remained stable. It is possible the Bank could continue to experience an additional runoff of the excess deposits due to their unusual and short-term nature as they are used to support small business and consumer-related expenses over the next year.

The Bank’s capital ratios remain well in excess of the regulatory minimums to be considered “well capitalized.” As of December 31, 2022, the Bank reported total risk-based capital of 19.54%. The Bank’s book equity decreased $117.2 million, or 36.71%, since December 31, 2021. This change in the Bank’s book equity is due to the unrealized losses associated with the investment portfolio. The unrealized losses have arisen due to the significant increase in interest rates since the end of 2021. The Bank has the intent and ability to hold the investments until maturity, expects full collection of the carrying amount of these securities, and does not expect to recognize the losses. On an ongoing basis, the Bank reviews its liquidity sources. As of December 31, 2022, the Bank has in excess of $1 billion in available liquidity. The Bank does not view the temporary nature of the book unrealized losses to be a significant risk to its long-term capital position. The unrealized losses reduce the Bank’s accumulated other comprehensive income, which the Bank has opted to exclude from its common equity tier 1 capital. Therefore, the Bank’s regulatory capital is not impacted by the changes in the market value of the investment securities in the Bank’s investment portfolio. The Bank’s regulatory capital, as defined by the FDIC, was $355.7 million as of December 31, 2022, an increase of $29.08 million, or 8.90%, over the same period in 2021. 

50.44% of the Bank’s cash dividend goes to the Doyle Trust which funds the Doyle Scholarships at the Santa Rosa Junior College.

###

Forward-Looking Information:

The following appears in accordance with the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking statements about the Company, including descriptions of plans or objectives of its management for future operations, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.”

Forward-looking statements, by their nature, are subject to risks and uncertainties. A number of factors — many of which are beyond the Company’s control — could cause actual conditions, events or results to differ significantly from those described in the forward-looking statements. Forward-looking statements speak only as of the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date forward looking statements are made.

###

About Exchange Bank

Headquartered in Sonoma County and founded in 1890, Exchange Bank is a full-service community bank with assets of $3.33 billion. Exchange Bank provides a wide range of personal, commercial and trust and investment management services with 16 retail branches in Sonoma County, a commercial branch in Roseville and Trust & Investment Management offices in Santa Rosa, Roseville and Silicon Valley. The Bank’s legacy of financial leadership and community support is grounded in its core values of commitment, respect, integrity and teamwork. Exchange Bank is known for its people who care about their customers, their company and the communities where they live and work. Exchange Bank is a 17-year winner of the North Bay Business Journal’s Best Places to Work survey and the 2022 San Francisco Business Times Corporate Philanthropy Award. Exchange Bank was named Best Consumer Bank by the NorthBay biz Magazine’s Best of the North Bay readers’ poll. The Petaluma Argus Courier People’s Choice Awards named Exchange Bank Best Local Bank 2022 and the Bohemian Magazine’s Best of the North Bay 2022 named Exchange Bank Best Business Bank and Best Consumer Bank. www.exchangebank.com

Member FDIC — Equal Housing Lender — Equal Opportunity Employer


Loading