“Operating expenses declined for the first quarter compared to the preceding quarter and the first quarter a year ago, largely due to lower costs associated with the real estate owned portfolio, particularly valuation adjustments,” said Grescovich. “These credit costs should continue to decline as further problem asset resolution occurs.”Total other operating expenses (non-interest expenses) were $37.9 million in the first quarter of 2012, compared to $38.7 million in the preceding quarter and $38.1 million in the first quarter of 2011. The decrease was largely a result of decreased costs related to real estate owned and FDIC deposit insurance, partially offset by increased compensation-related expenses. *Earnings information excluding fair value and other-than-temporary impairment (OTTI) adjustments (alternately referred to as other operating income from core operations or revenues from core operations) represent non-GAAP (Generally Accepted Accounting Principles) financial measures. Management has presented these non-GAAP financial measures in this earnings release because it believes that they provide useful and comparative information to assess trends in the Company’s core operations reflected in the current quarter’s results. Where applicable, the Company has also presented comparable earnings information using GAAP financial measures. Balance Sheet Review “Loan balances declined slightly compared to the previous quarter, primarily as a result of the expected seasonal pay down of agricultural loans, the impact of refinancing activity on residential mortgage loans and further reductions in land development loans. Production levels for targeted loans remained encouraging, resulting in a consistent pipeline of lending opportunities and modest growth in commercial business loans. While we expect a continued challenging economic environment, we believe that our well-focused marketing efforts to attract business clients will allow us to capitalize on additional lending opportunities going forward,” said Grescovich. Net loans were $3.15 billion at March 31, 2012, compared to $3.21 billion at December 31, 2011 and $3.23 billion a year ago. Commercial and agricultural business loans were $798.5 million at March 31, 2012 compared to $819.6 million at December 31, 2011 and $765.9 million a year ago. Commercial real estate and multi-family real estate loans were $1.21 billion at March 31, 2012, compared to $1.23 billion at both December 31, 2011 and at March 31, 2011.