California First National Bancorp (NASDAQ: CFNB) (“CalFirst Bancorp” or the “Company”) today announced net earnings of $2.5 million for the first quarter ended September 30, 2011, up 50% from $1.7 million earned during the first quarter of fiscal 2011. Diluted earnings per share for the first quarter were $0.24 as compared to $0.16 per share reported for the same period of the prior year. The increase in net earnings from the first quarter of the prior year is largely due to a $1.2 million increase in income realized on the investment in residuals coming to end of term during the period and a 12% increase in net interest income after provision for credit losses. Net direct finance, loan and interest income after provision for credit losses increased by $532,000, or 11%, to $5.2 million. Total direct finance, loan and interest income for the first quarter ending September 30, 2011 increased 4% to $6.1 million, compared to $5.9 million for the first quarter of fiscal 2011. This increase includes a $428,000, or 12%, increase in direct finance income related to an 18% increase in the average investment in leases while the average yield earned declined by 46 basis points. Commercial loan income decreased by $211,000 as the average yield declined 153 basis points on average balance that increased 9% to $87.9 million compared to $80.5 million for the first quarter of the prior year. The average yield on all leases and loans held in the Company’s portfolio decreased 74 basis points to 6.80% while the average yield on cash and investments of 2.0% was down 39 basis points from the first quarter of fiscal 2011. Interest expense paid on deposits and borrowings decreased 4% due to lower average interest rate paid of 1.26%, down 39 basis points from 1.65% during the comparable period in fiscal 2011, which offset the 26% increase in the average balance of deposits and borrowings to $280.8 million. There was a $275,000 decrease in the provision for credit losses as no provision was made during the quarter ending September 30, 2011 due to stability in the lease portfolio and an 8% decline in the commercial loan portfolio from $93.7 million at June 30, 2011 to $87.3 million at September 30, 2011.