Bridge Capital Holdings (NASDAQ: BBNK), whose subsidiary is Bridge Bank, National Association, announced today its financial results for the third quarter and nine months ended September 30, 2011.

The Company reported net operating income of $2.2 million for the three months ended September 30, 2011 representing an increase of $417,000, or 23%, from $1.8 million in the quarter ended June 30, 2011 and an increase of $881,000, or 67%, compared to net operating income of $1.3 million for the same period one year ago.

For the quarter ended September 30, 2011, the Company reported earnings per diluted share of $0.15, which compares with $0.12 for the quarter ended June 30, 2011. This also compares with earnings per share of $0.09 for the quarter ended September 30, 2010, which included preferred dividend payments of $299,000. Due to the repayment of TARP funds in 2011, the Company no longer has any preferred dividend payments.

The Company reported net operating income of $5.5 million for the nine months ended September 30, 2011 representing an increase of $3.1 million, compared to net operating income of $2.4 million for the same period one year ago. Net income available to common shareholders was reduced by preferred dividends of $200,000 and $1.7 million during the nine months ended September 30, 2011 and 2010, respectively, resulting in earnings per diluted share of $0.37 and $0.08, respectively.

For the quarter ended September 30, 2011, the Company’s return on average assets and return on average equity were 0.81% and 6.94%, respectively, and compared to 0.73% and 5.82%, respectively, for the quarter ended June 30, 2011 and 0.58% and 4.65%, respectively, for the same period in 2010. For the nine months ended September 30, 2011, the Company’s return on average assets and return on average equity were 0.72% and 5.80%, respectively, and compared to 0.37% and 2.93%, respectively, for the same period in 2010.

“Our strong third quarter performance was driven by positive trends in revenue generation, operating efficiency, and asset quality,” said Daniel P. Meyers, President and Chief Executive Officer of Bridge Bank and Bridge Capital Holdings. “Our reputation among the business community for professionalism, responsiveness, and flexibility continues to grow, which helped us attract new business clients in all of our business lines, including commercial and industrial, structured finance, technology and emerging business, SBA, and international. This new client activity helped to drive a 10% increase in total loans and a 6% increase in total deposits during the third quarter. As our balance sheet grows, we are seeing steady increases in profitability, and higher returns on assets and equity. We continue to have a strong pipeline of quality new opportunities, which should drive improving performance going forward.”

Third Quarter Highlights

Third quarter results, compared to second quarter 2011 (unless otherwise noted), reflected strong performance across all areas of the Company’s business and included:
  • Pre-tax, pre-provision profit increased $1.9 million or 62%.
  • Net interest income of $12.7 million was the highest ever for a quarter and represented growth of $885,000, or 8%, compared to $11.8 million for the prior quarter.
  • Net interest margin benefited from loan growth and remained strong at 4.95%.
  • Total gross loans increased to $719.8 million, up from $653.2 million at June 30, 2011, driven by continued growth in the commercial and factoring and asset-based lending portfolios.
  • Allowance for credit losses remained stable at 2.54% of total gross loans and represented 150.60% of nonperforming loans.
  • Nonperforming loans declined to $12.1 million, or 1.69% of total gross loans.
  • Continued improvement in credit quality resulted in net loan recoveries of $170,000.
  • Provision for credit losses of $1.3 million due to the growth of the loan portfolio.
  • Total deposits of $936.0 million represented growth of $56.3 million, or 6%, compared to $879.7 million at June 30, 2011.
  • Total assets reached $1.1 billion at September 30, 2011.
  • Total Risk-Based Capital Ratio of 16.55%, Tier I Capital Ratio of 15.29%, and Tier I Leverage Ratio of 13.39%.

Net Interest Income and Margin

Net interest income of $12.7 million for the quarter ended September 30, 2011 represented an increase of $885,000, or 8%, compared to $11.8 million for the quarter ended June 30, 2011 and an increase of $2.0 million, or 19%, compared to $10.7 million for the quarter ended September 30, 2010. The increase in net interest income from the second quarter of 2011 was primarily attributable to an increase in average earning assets. The increase in net interest income from the same period one year ago was primarily attributable to an increase in average earning assets combined with a lower cost of funds. Average earning assets of $1.0 billion for the quarter ended September 30, 2011 increased $83.8 million, or 9%, compared to $930.2 million for the quarter ended June 30, 2011 and increased $162.1 million, or 19%, compared to $852.0 million for the same quarter in 2010. The Company’s loan-to-deposit ratio, a measure of leverage, averaged 73.3% during the quarter ended September 30, 2011, which represented a decrease compared to an average of 75.8% for the quarter ended June 30, 2011 and a decrease compared to an average of 78.5% for the same quarter of 2010.

For the nine months ended September 30, 2011, net interest income of $35.5 million represented an increase of $4.8 million, or 16%, from $30.7 million for the nine months ended September 30, 2010 and was primarily attributed to an increase in average earning assets combined with a decrease in average nonperforming loans and a lower cost of funds. Average earning assets of $969.4 million for the nine months ended September 30, 2011 increased $149.0 million, or 18%, compared to $820.4 million for the same period one year ago. The Company’s loan-to-deposit ratio, a measure of leverage, averaged 74.3% during the nine months ended September 30, 2011, which represented a decrease compared to an average of 79.8% for the same period of 2010.

Changes in short-term interest rates impact growth in net interest income as the interest rate earned on a majority of the Company’s assets, specifically the loan portfolio, adjust with changes in short-term market rates. As such, the nature of the Company’s balance sheet is that over time, as short-term interest rates change, income on interest earning assets has a greater impact on net interest income than interest paid on liabilities. The Company’s prime rate has remained 3.25% throughout 2011 and 2010.

The Company’s net interest margin for the quarter ended September 30, 2011 was 4.95%, compared to 5.07% for the quarter ended June 30, 2011, and 4.97% for the same period one year earlier. The decrease in net interest margin from the second quarter of 2011 was primarily due to decreased loan fees. The negative impact on the net interest margin from decreased loan fees for the third quarter of 2011 compared to the second quarter of 2011 was 10 basis points. The negative impact of reversed or foregone interest (net of recovered interest) due to nonperforming assets for the third quarter of 2011 compared to the second quarter of 2011 was 3 basis points.

The decrease in net interest margin for the third quarter of 2011 compared to the same period one year ago was primarily due to higher reversed or forgone interest on nonperforming assets combined with lower balance sheet leverage, offset by increased loan fees related to the growth in the factoring and asset-based lending portfolio. The negative impact of reversed or foregone interest (net of recovered interest) due to nonperforming assets for the third quarter of 2011 compared to the third quarter of 2010 was 10 basis points. The positive impact on the net interest margin from increased loan fees for the third quarter of 2011 compared to the third quarter of 2010 was 12 basis points.

The Company’s net interest margin for the nine months ended September 30, 2011 was 4.89%, compared to 5.00% for the same period one year earlier. The decrease in net interest margin from prior year was primarily due to decreased balance sheet leverage and a less favorable mix in average earning assets, partially offset by increased loan fees related to the growth in the factoring and asset-based lending portfolio. The positive impact on the net interest margin from increased loan fees for the nine months ended September 30, 2011 compared to the same period one year ago was 13 basis points. The negative impact of reversed or foregone interest (net of recovered interest) due to nonperforming assets was 15 basis points in the nine months ended September 30, 2011 compared to 14 basis points for the same period one year earlier.

Non-Interest Income

The Company’s non-interest income for the quarters ending September 30, 2011, June 30, 2011, and September 30, 2010 was $3.3 million, $1.5 million, and $1.4 million, respectively. During the third quarter of 2011, the Company recognized a gain of $815,000 from the sale of SBA loans and a gain of $595,000 from the sale of securities. The Company did not sell any SBA loans or securities during the second quarter of 2011 or the third quarter of 2010.

Non-interest income for the nine months ending September 30, 2011 and 2010 was $7.3 million and $4.8 million, respectively. Non-interest income for the nine months ending September 30, 2011 included a $1.4 million gain on the sale of SBA loans. The Company did not sell any SBA loans during the first nine months of 2010. Non-interest income for the nine months ending September 30, 2011 also included international fee income of $1.8 million and depositor service charges of $2.1 million compared to $1.3 million and $1.8 million, respectively, for the same period one year earlier.

Net interest income and non-interest income comprised total revenue of $15.9 million for the three months ended September 30, 2011 compared to $13.3 million for the three months ended June 30, 2011 and $12.1 million for the same period one year earlier. For the nine months ended September 30, 2011, total revenue of $42.8 million represented an increase of $7.3 million, or 21%, from $35.5 million for the nine months ended September 30, 2010.

“Third quarter revenue of $15.9 million was the highest for any quarter in the history of the Company,” said Thomas A. Sa, Executive Vice President and Chief Financial Officer of Bridge Capital Holdings, “After backing out gains on sales of SBA loans and securities, core revenue grew 9 percent on a linked quarter basis. Our success was broad-based and we’re very pleased with the momentum of the business coming out of the second quarter and carrying through the quarter ended September 30, 2011.”

Non-Interest Expense

Non-interest expense was $10.9 million for the quarter ended September 30, 2011, compared to $10.2 million and $9.3 million for the quarters ended June 30, 2011 and September 30, 2010, respectively. Non-interest expense for the nine months ended September 30, 2011 was $31.4 million compared to $28.6 million for the same period one year ago.

Salary and benefits expense for the quarter ended September 30, 2011 was $6.2 million compared to $5.9 million and $5.1 million for the quarters ended June 30, 2011 and September 30, 2010, respectively. Salary and benefits expense for the third quarter of 2011 included additional accruals for incentive compensation due to strong performance from loan generation. Salary and benefits expense for the nine months ended September 30, 2011 was $17.5 million compared to $15.4 million for the same period one year ago. As of September 30, 2011, the Company employed 184 full-time equivalents (FTE) compared to 172 FTE at June 30, 2011 and 164 FTE at September 30, 2010.

“Other real estate owned” and loan related charges were $224,000 for the quarter ended September 30, 2011 compared to $395,000 and $259,000 for the quarters ended June 30, 2011 and September 30, 2010, respectively. “Other real estate owned” and loan related charges were $1.2 million for the nine months ended September 30, 2011 compared to $1.4 million for the same period one year ago. The decrease in “other real estate owned” and loan related charges was primarily attributed to a decline in nonperforming assets.

The Company’s efficiency ratio, the ratio of non-interest expense to revenues, was 68.66%, 76.86%, and 76.59% for the quarters ended September 30, 2011, June 30, 2011, and September 30, 2010, respectively. The efficiency ratio was 73.30% for the nine months ended September 30, 2011 compared to 80.60% for the same period one year earlier.

Balance Sheet

Bridge Capital Holdings reported total assets at September 30, 2011 of $1.09 billion, compared to $1.03 billion at June 30, 2011 and $940.0 million on the same date one year ago. The increase in total assets of $60.0 million, or 6%, from June 30, 2011 was primarily due to new commercial and factoring loans funded at the end of the third quarter. The increase in total assets of $154.0 million, or 16%, compared to September 30, 2010 was primarily due to a higher balance of investment securities available for sale and higher loan balances as a result of liquidity from increased low cost deposits.

The Company reported total gross loans outstanding at September 30, 2011 of $719.8 million, which represented an increase of $66.6 million, or 10%, over $653.2 million at June 30, 2011 and an increase of $114.6 million, or 19%, over $605.2 million at September 30, 2010. The increase in total gross loans from June 30, 2011 and September 30, 2010 was primarily attributable to continued growth in the commercial and factoring and asset-based lending portfolios.

The Company’s total deposits were $936.0 million as of September 30, 2011, which represented an increase of $56.3 million, or 6%, compared to $879.7 million at June 30, 2011 and an increase of $140.5 million, or 18%, compared to $795.5 million at September 30, 2010. The increase in deposits from June 30, 2011 and September 30, 2010 was primarily attributable to continued growth in noninterest-bearing demand deposits.

Demand deposits represented 58.1% of total deposits at September 30, 2011, compared to 59.4% at June 30, 2011 and 55.1% for the same period one year ago. Core deposits represented 96.5% of total deposits at September 30, 2011, up from 96.2% at June 30, 2011 and 94.2% at September 30, 2010.

Credit Quality

Nonperforming assets decreased to $21.4 million, or 1.96% of total assets, as of September 30, 2011, compared to $22.3 million, or 2.16% of total assets, as of June 30, 2011 and $28.3 million, or 3.01% of total assets, at September 30, 2010. The nonperforming assets at September 30, 2011 consisted of loans on nonaccrual or 90 days or more past due totaling $12.1 million, and “other real estate owned” (OREO) valued at $9.3 million.

Nonperforming loans at September 30, 2011 were comprised of loans with legal contractual balances totaling approximately $16.7 million reduced by $1.1 million received in non-accrual interest and impairment charges of $3.5 million which have been charged against the allowance for credit losses.

Nonperforming loans decreased to $12.1 million, or 1.69% of total gross loans, as of September 30, 2011, compared to $12.6 million, or 1.93% of total gross loans, as of June 30, 2011 and $19.6 million, or 3.25% of total gross loans, at September 30, 2010.

The carrying value of OREO was $9.3 million as of September 30, 2011, compared to $9.7 million as of June 30, 2011 and $8.6 million as of September 30, 2010.

The Company charged-off $280,000 during the three months ended September 30, 2011 compared to $380,000 charged-off during the three months ended June 30, 2011 and $1.3 million charge-off during the three months ended September 30, 2010. During the nine months ended September 30, 2011, the Company charged-off balances totaling $2.4 million which compared to $5.8 million charged-off during the same period of 2010.

During the three months ended September 30, 2011, the Company recognized $450,000 in loan recoveries compared to $2.1 million and $1.0 million, respectively, in loan recoveries for the three months ended June 30, 2011 and September 30, 2010. During the nine months ended September 30, 2011, the Company recognized $3.2 million in loan recoveries which compared to $2.3 million in loan recoveries for the same period one year ago.

The allowance for loan losses was $18.3 million, or 2.54% of total loans, at September 30, 2011, compared to $16.9 million, or 2.58% of total loans, at June 30, 2011 and $15.2 million, or 2.52% of total loans, at September 30, 2010. The provision for credit losses was $1.3 million and $350,000, respectively, for the quarters ending September 30, 2011 and 2010. The Company did not record a provision for credit losses for the three months ended June 30, 2011 due to the improving condition of the loan portfolio combined with the loan recoveries recognized during that quarter. The provision for credit losses for the third quarter of 2011 was due to the growth of the loan portfolio. The provision for credit losses for the nine months ending September 30, 2011 and September 30, 2010 was $2.0 million and $2.8 million, respectively. The decrease in the provision for credit losses for the first nine months of 2011 compared to the same period one year ago reflects lower charge-offs and greater recoveries experienced during the current year combined with the improving condition of the Company’s loan portfolio.

Capital Adequacy

The Company’s capital ratios at September 30, 2011 substantially exceed the regulatory definition for being “well capitalized” with a Total Risk-Based Capital Ratio of 16.55%, a Tier I Capital Ratio of 15.29%, and a Tier I Leverage Ratio of 13.39%. Additionally, the Company’s tangible common equity ratio at September 30, 2011 was 11.52% and book value per common share was $8.33, representing an increase of $0.14, or 2%, from $8.19 at June 30, 2011 and an increase of $0.20, or 2%, from September 30, 2010.

Conference Call and Webcast

Management will host a conference call today at 5:00 p.m. Eastern time/2:00 p.m. Pacific time to discuss the Company’s financial results and answer questions.

Individuals interested in participating in the conference call may do so by dialing 877.941.8631 from the United States, or 480.629.9772 from outside the United States, and providing the conference ID 4481624. Those interested in listening to the conference call live via the Internet may do so by visiting the Investor Relations section of the Company's Web site at www.bridgebank.com.

A telephone replay will be available through November 8, 2011 by dialing 800.406.7325 from the United States, or 303.590.3030 from outside the United States, and entering the conference ID 4481624. A webcast replay will be available for 90 days.

About Bridge Capital Holdings

Bridge Capital Holdings is the holding company for Bridge Bank, National Association. Bridge Capital Holdings was formed on October 1, 2004 and holds a Global Select listing on The NASDAQ Stock Market under the trading symbol BBNK. For additional information, visit the Bridge Capital Holdings website at http://www.bridgecapitalholdings.com.

About Bridge Bank, N.A.

Bridge Bank, N.A. is Silicon Valley’s full-service professional business bank. The Bank is dedicated to meeting the financial needs of small, middle market, and emerging technology businesses. Bridge Bank provides its clients with a comprehensive package of business banking solutions delivered through experienced, professional bankers. For additional information, visit the Bridge Bank website at http://www.bridgebank.com.

Forward-Looking Statements

Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and are subject to the safe harbors created by that Act. 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 are based on currently available information, expectations, assumptions, projections, and management’s judgment about the Company, the banking industry and general economic conditions. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely.

Forward-looking statements involve significant risks and uncertainties and actual results may differ materially from those presented, either expressed or implied, in this press release. Factors that might cause such differences include, but are not limited to: the Company’s ability to successfully execute its business plans and achieve its objectives; changes in general economic, real estate and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; new litigation or changes in existing litigation; future credit loss experience; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company’s operations or business; loss of key personnel; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies; and the ability to satisfy requirements related to the Sarbanes-Oxley Act and other regulation on internal control.

The reader should refer to the more complete discussion of such risks in Bridge Capital Holdings’ annual reports on Forms 10-K and quarterly reports on Forms 10-Q on file with the Securities and Exchange Commission. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

-Financial Tables Follow-
BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in Thousands)
           
Three months ended Nine months ended
  09/30/11     06/30/11     09/30/10     09/30/11     09/30/10  
 
INTEREST INCOME
Loans $ 11,615 $ 11,132 $ 10,649 $ 33,563 $ 31,053
Federal funds sold 64 56 66 202 188
Investment securities available for sale 1,501 1,104 632 3,407 1,771
Other   -     9     22     19     104  
Total interest income   13,180     12,301     11,369     37,191     33,116  
 
INTEREST EXPENSE
Deposits 259 262 426 827 1,587
Other   270     273     275     889     831  
Total interest expense   529     535     701     1,716     2,418  
 
Net interest income 12,651 11,766 10,668 35,475 30,698
Provision for credit losses   1,250     -     350     2,000     2,750  

Net interest income after provision for credit losses
  11,401     11,766     10,318     33,475     27,948  
 
NON-INTEREST INCOME
Service charges on deposit accounts 707 720 638 2,102 1,761
International Fee Income 704 530 415 1,780 1,321
Other non-interest income   1,846     261     380     3,432     1,680  
Total non-interest income   3,257     1,511     1,433     7,314     4,762  
 
OPERATING EXPENSES
Salaries and benefits 6,207 5,927 5,103 17,512 15,400
Premises and fixed assets 945 924 1,012 2,841 3,081
Other   3,771     3,354     3,153     11,012     10,099  
Total operating expenses   10,923     10,205     9,268     31,365     28,580  
 
Income before income taxes 3,735 3,072 2,483 9,424 4,130
Income tax expense 1,532 1,286 1,161 3,865 1,688
         
NET INCOME $ 2,203   $ 1,786   $ 1,322   $ 5,559   $ 2,442  
 
Preferred dividends   -     -     299     200     1,657  

Net income (loss) available to common shareholders
$ 2,203   $ 1,786   $ 1,023   $ 5,359   $ 785  
 
EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share $ 0.15   $ 0.13   $ 0.10   $ 0.38   $ 0.09  
Diluted earnings (loss) per share $ 0.15   $ 0.12   $ 0.09   $ 0.37   $ 0.08  
Average common shares outstanding   14,297,806     14,263,583     10,417,094     14,217,752     9,112,264  

Average common and equivalent shares outstanding
  14,699,419     14,652,766     10,843,374     14,610,302     9,524,004  
 
PERFORMANCE MEASURES
Return on average assets 0.81 % 0.73 % 0.58 % 0.72 % 0.37 %
Return on average equity 6.94 % 5.82 % 4.65 % 5.80 % 2.93 %
Efficiency ratio 68.66 % 76.86 % 76.59 % 73.30 % 80.60 %
 
BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
INTERIM CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in Thousands)
         
  09/30/11     06/30/11     03/31/11     12/31/10     09/30/10  
 
ASSETS
Cash and due from banks $ 18,836 $ 28,299 $ 15,001 $ 8,676 $ 17,599
Federal funds sold 85,075 110,330 108,520 114,240 125,155
Interest-bearing deposits 335 335 1,560 2,539 3,028
Investment securities available for sale 232,758 207,275 204,177 217,303 151,119
Loans:
Commercial 295,916 265,621 256,865 269,034 245,894
SBA 76,430 69,396 65,537 67,538 60,005
Real estate construction 40,897 38,615 35,291 40,705 39,416
Land and land development 6,046 5,808 8,235 9,072 9,558
Real estate other 141,539 137,199 139,499 138,633 141,245
Factoring and asset-based lending 153,230 132,182 122,052 122,542 105,172
Other   5,727     4,415     4,193     4,023     3,917  
Loans, gross 719,785 653,236 631,672 651,547 605,207
Unearned fee income (2,448 ) (1,573 ) (1,422 ) (1,444 ) (1,509 )
Allowance for credit losses   (18,292 )   (16,872 )   (15,171 )   (15,546 )   (15,248 )
Loans, net 699,045 634,791 615,079 634,557 588,450
Premises and equipment, net 2,184 2,223 2,396 2,580 2,833
Accrued interest receivable 3,317 3,313 3,592 3,439 3,185
Other assets   52,433     47,399     48,112     46,397     48,606  
Total assets $ 1,093,983   $ 1,033,965   $ 998,437   $ 1,029,731   $ 939,975  
 
LIABILITIES
Deposits:
Demand noninterest-bearing $ 538,987 $ 515,622 $ 475,287 $ 443,806 $ 432,714
Demand interest-bearing 4,325 6,505 5,096 5,275 5,164
Money market and savings 359,634 324,079 305,113 355,772 311,107
Time   33,046     33,467     42,215     43,093     46,460  
Total deposits   935,992     879,673     827,711     847,946     795,445  
 
Junior subordinated debt securities 17,527 17,527 17,527 17,527 17,527
Other borrowings - - - 7,672 -
Accrued interest payable 27 41 36 48 60
Other liabilities   14,392     13,092     30,797     14,235     13,978  
Total liabilities   967,938     910,333     876,071     887,428     827,010  
 
SHAREHOLDERS' EQUITY
Preferred stock - - - 23,864 23,864
Common stock 105,918 105,239 106,112 104,843 74,322
Retained earnings 21,143 18,939 17,154 15,784 15,933
Accumulated other comprehensive (loss)   (1,016 )   (546 )   (900 )   (2,188 )   (1,154 )
Total shareholders' equity   126,045     123,632     122,366     142,303     112,965  
Total liabilities and shareholders' equity $ 1,093,983   $ 1,033,965   $ 998,437   $ 1,029,731   $ 939,975  
 
CAPITAL ADEQUACY
Tier I leverage ratio 13.39 % 14.30 % 13.68 % 16.67 % 14.44 %
Tier I risk-based capital ratio 15.29 % 16.64 % 16.98 % 19.61 % 17.18 %
Total risk-based capital ratio 16.55 % 17.89 % 18.23 % 20.87 % 18.45 %
Total equity/ total assets 11.52 % 11.96 % 12.26 % 13.82 % 12.02 %
Book value per common share $ 8.33 $ 8.19 $ 8.12 $ 8.16 $ 8.13
 
BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
INTERIM CONSOLIDATED AVERAGE BALANCE SHEET AND YIELD DATA (UNAUDITED)
(Dollars in Thousands)
             
Three months ended September 30,
2011 2010
 
Yields Interest Yields Interest
Average or Income/ Average or Income/
Balance Rates Expense Balance Rates Expense
ASSETS
Interest earning assets (2):
Loans (1) $ 673,464 6.84 % $ 11,615 $ 599,566 7.05 % $ 10,649
Federal funds sold 107,063 0.24 % 64 112,348 0.23 % 66
Investment securities 233,202 2.55 % 1,501 136,014 1.84 % 632
Other   335 0.00 %   -   4,071 2.14 %   22
Total interest earning assets   1,014,064 5.16 %   13,180   851,999 5.29 %   11,369
 
Noninterest-earning assets:
Cash and due from banks 25,066 18,811
All other assets (3)   36,189   36,656
TOTAL $ 1,075,319 $ 907,466
 

LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits:
Demand $ 7,115 0.06 % $ 1 $ 6,227 0.06 % $ 1
Money market and savings 324,282 0.27 % 220 323,358 0.34 % 280
Time 32,948 0.46 % 38 50,253 1.14 % 145
Other   17,527 6.11 %   270   17,527 6.22 %   275
Total interest-bearing liabilities   381,872 0.55 %   529   397,365 0.70 %   701
 
Noninterest-bearing liabilities:
Demand deposits 554,001 384,035

Accrued expenses and other liabilities
13,596 13,210
Shareholders' equity   125,850   112,856
TOTAL $ 1,075,319 $ 907,466
       
Net interest income and margin 4.95 % $ 12,651 4.97 % $ 10,668
 

(1)

Loan fee amortization of $1.5 million and $1.0 million, respectively, is included in interest income. Nonperforming loans have been included in average loan balances.

(2)

Interest income is reflected on an actual basis, not a fully taxable equivalent basis. Yields are based on amortized cost.

(3)

Net of average allowance for credit losses of $16.9 million and $15.0 million, respectively.
 
BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
INTERIM CONSOLIDATED AVERAGE BALANCE SHEET AND YIELD DATA (UNAUDITED)
(Dollars in Thousands)
             
Nine months ended September 30,
2011 2010
 
Yields Interest Yields Interest
Average or Income/ Average or Income/
Balance Rates Expense Balance Rates Expense
ASSETS
Interest earning assets (2):
Loans (1) $ 643,149 6.98 % $ 33,563 $ 583,235 7.12 % $ 31,053
Federal funds sold 115,167 0.23 % 202 107,604 0.23 % 188
Investment securities 209,843 2.17 % 3,407 122,843 1.93 % 1,771
Other   1,222 2.08 %   19   6,731 2.07 %   104
Total interest earning assets   969,381 5.13 %   37,191   820,413 5.40 %   33,116
 
Noninterest-earning assets:
Cash and due from banks 22,671 17,901
All other assets (3)   37,145   34,754
TOTAL $ 1,029,197 $ 873,068
 

LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Deposits:
Demand $ 6,836 0.06 % $ 3 $ 6,094 0.11 % $ 5
Money market and savings 323,298 0.27 % 652 301,765 0.42 % 954
Time 37,419 0.61 % 172 62,713 1.34 % 628
Other   21,123 5.63 %   889   17,600 6.31 %   831
Total interest-bearing liabilities   388,676 0.59 %   1,716   388,172 0.83 %   2,418
 
Noninterest-bearing liabilities:
Demand deposits 498,553 360,365

Accrued expenses and other liabilities
13,809 13,226
Shareholders' equity   128,159   111,305
TOTAL $ 1,029,197 $ 873,068
       
Net interest income and margin 4.89 % $ 35,475 5.00 % $ 30,698
 

(1)

Loan fee amortization of $4.3 million and $2.8 million, respectively, is included in interest income. Nonperforming loans have been included in average loan balances.

(2)

Interest income is reflected on an actual basis, not a fully taxable equivalent basis. Yields are based on amortized cost.

(3)

Net of average allowance for credit losses of $16.5 million and $15.6 million, respectively.
 
BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
INTERIM CONSOLIDATED CREDIT DATA (UNAUDITED)
(Dollars in Thousands)
         
  09/30/11     06/30/11     03/31/11     12/31/10     09/30/10  
 
ALLOWANCE FOR CREDIT LOSSES
Balance, beginning of period $ 16,872 $ 15,171 $ 15,546 $ 15,248 $ 15,137
Provision for credit losses, quarterly 1,250 - 750 1,950 350
Charge-offs, quarterly (280 ) (380 ) (1,757 ) (2,340 ) (1,268 )
Recoveries, quarterly   450     2,081     632     688     1,029  
Balance, end of period $ 18,292   $ 16,872   $ 15,171   $ 15,546   $ 15,248  
 
 
 
 
NONPERFORMING ASSETS
Loans accounted for on a non-accrual basis $ 12,146 $ 12,627 $ 11,821 $ 16,696 $ 19,641

Loans with principal or interest contractually past due 90 days or more and still accruing interest
  -     -     2,442     -     -  
Nonperforming loans 12,146 12,627 14,263 16,696 19,641
Other real estate owned   9,255     9,661     9,666     6,645     8,625  
Nonperforming assets $ 21,401   $ 22,288   $ 23,929   $ 23,341   $ 28,266  
 

Loans restructured and in compliance with modified terms
  10,569     4,926     4,456     4,494     4,474  
Nonperforming assets and restructured loans $ 31,970   $ 27,214   $ 28,385   $ 27,835   $ 32,740  
 
 
Nonperforming Loans by Asset Type:
Commercial $ 1,235 $ 1,262 $ 1,365 $ 1,130 $ 1,081
SBA 714 643 209 228 252
Construction - - - 5,342 6,481
Land 583 638 2,595 3,176 4,333
Other real estate 7,006 7,370 10,094 6,820 7,385
Factoring and asset-based lending   2,608     2,714     -     -     109  
Nonperforming loans $ 12,146   $ 12,627   $ 14,263   $ 16,696   $ 19,641  
 
 
 
 
ASSET QUALITY
Allowance for credit losses / gross loans 2.54 % 2.58 % 2.40 % 2.39 % 2.52 %
Allowance for credit losses / nonperforming loans 150.60 % 133.62 % 106.37 % 93.11 % 77.63 %
Nonperforming assets / total assets 1.96 % 2.16 % 2.40 % 2.27 % 3.01 %
Nonperforming loans / gross loans 1.69 % 1.93 % 2.26 % 2.56 % 3.25 %
Net quarterly charge-offs / gross loans -0.02 % -0.26 % 0.18 % 0.25 % 0.04 %

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