First Community Bancorp Announces Results for the First Quarter of 2008

SAN DIEGO, April 17 /PRNewswire-FirstCall/ -- First Community Bancorp
(Nasdaq: FCBP) today announced a net loss for the first quarter of 2008 of
$272.7 million, or $10.05 per diluted share. The net loss was caused by a
$275.0 million write-off of goodwill made in response to the recent volatility
in the banking industry and the effect such volatility has had on the market
prices of banking stocks, including First Community Bancorp's. Net earnings
(loss) excluding the goodwill write-off (hereinafter referred to as "net
operating earnings") for the quarter ended March 31, 2008 totaled $2.3
million, or $0.08 per diluted share. This compares to net operating earnings
of $17.1 million, or $0.62 per diluted share, for the fourth quarter of 2007,
and net operating earnings of $28.5 million, or $0.98 per diluted share, for
the first quarter of 2007. The decrease in net operating earnings compared to
the net operating earnings for the fourth and first quarters of 2007 resulted
primarily from a higher provision for credit losses.
The discussion in this release of net earnings, earnings per share,
performance ratios and comparisons to prior periods will be based on net
operating earnings as described above and as shown in the following table.
The Company uses certain non-GAAP financial measures to provide meaningful
supplemental information regarding the Company's operational performance and
to enhance investors' overall understanding of such financial performance.
These non-GAAP financial measures are presented for supplemental informational
purposes only for understanding the Company's operating results and should not
be considered a substitute for financial information presented in accordance
with GAAP. Please refer to the table at the end of this release for a
presentation of performance ratios in accordance with GAAP and a
reconciliation of the non-GAAP financial measurements to the GAAP financial
measurements.

FIRST QUARTER RESULTS

First Fourth First
In thousands, except per Quarter Quarter Quarter
share data and percentages 2008 2007 2007

Net (loss) earnings as
reported ($272,723) $17,059 $28,546
Goodwill write-off 275,000 - -
Net operating earnings $2,277 $17,059 $28,546

Diluted (loss) earnings
per share $(10.05) $0.62 $0.98
Diluted net operating
earnings per share $0.08 $0.62 $0.98

Return on average assets (ROA) (21.10%) 1.32% 2.10%
Operating return on average
assets 0.18% 1.32% 2.10%

Return on average equity (ROE) (96.35%) 5.86% 9.91%
Operating return on average
equity 0.80% 5.86% 9.91%

Efficiency ratio 481.6% 53.2% 42.2%
Operating efficiency ratio 54.8% 53.2% 42.2%

Net interest margin 5.58% 6.11% 6.33%

The decrease in net operating earnings of $14.8 million for the first
quarter of 2008 compared to the fourth quarter of 2007 is due to the
combination of lower net interest income ($2.9 million after tax), a higher
provision for credit losses ($13.3 million after tax), higher noninterest
income ($705,000 after tax), and lower operating noninterest expenses
($600,000 after tax). The fourth quarter of 2007 included prepayment
penalties on certain FHLB advances, a donation, and reorganization charges,
which totaled $1.6 million in the aggregate after tax; there were no such
items in the other periods presented. The increase in the operating
efficiency ratio in the first quarter of 2008 was due mostly to the combined
effects of lower net interest income, higher noninterest income and lower
overhead costs. The prepayment penalty, donation and reorganization charges
increased our efficiency ratio by 409 basis points in the fourth quarter of
2007.
The decrease in net operating earnings for the first quarter of 2008
compared to the first quarter of 2007 is attributed mostly to a higher
provision for credit losses and lower net interest income and noninterest
income. The decrease in both net interest income and noninterest income
relates, in part, to the sale of a participating interest of approximately
$353 million in commercial real estate mortgage loans at the end of the first
quarter of 2007; this sale generated an after-tax gain of $3.9 million and the
proceeds were used mostly to repay overnight borrowings. Noninterest income
also declined due to lower income related to discounts recognized on acquired
loans that have since been repaid.
Matt Wagner, Chief Executive Officer, stated, "During the first quarter,
we focused on asset quality and core deposit growth. We continue to manage
the loan portfolio aggressively, and we further reduced our exposure to
residential construction loans and other credits that carry heightened risk in
today's environment. The nonowner-occupied residential construction loan
portfolio declined by almost $63 million, and now represents 7.2% of our gross
loans." Mr. Wagner continued, "The favorable rate environment and our capital
strength enabled us to grow core deposits by $102 million during the first
quarter. While we remain cautious, we believe our healthy capital ratios and
allowance for credit losses position us favorably in the current environment
as we seek to attract core deposits and continue serving our customer base."
Vic Santoro, Executive Vice President and Chief Financial Officer,
commented, "Since its formation, the Company completed 19 acquisitions that
have increased its assets to nearly $5 billion, developed a sizable revenue
stream and created $761 million in goodwill, an asset which is not amortized
to expense. The disruption in the financial sector has caused the market
valuation for banking stocks to decline over the last few quarters, including
the market value of our common stock. As a result, in following the
accounting rules, we wrote off to expense $275 million in goodwill. This
expense write-off had no impact on our regulatory capital levels, cash flows,
or liquidity." Mr. Santoro continued, "Although the Federal Reserve's actions
to lower the Federal funds rate negatively affected our net interest margin,
we were able to reprice certain deposits throughout the first quarter. This
repricing along with the high level of our demand deposit balances enabled us
to lower our total deposit cost to 1.35% in March. The combination of our
strong net interest margin of 5.56% in March, reduced loan portfolio risk, our
credit loss reserve coverage and high regulatory capital levels position us to
take advantage of growth opportunities as they arise."
BALANCE SHEET CHANGES
Total loans, including loans held for sale and net of unearned income,
decreased $46.5 million to $4.0 billion at March 31, 2008, from December 31,
2007. The decrease is primarily due to the sale of $34.1 million of
nonaccrual loans and the continued emphasis on lowering residential
construction loan exposure offset by growth in commercial real estate loan
products. Deposits increased $74.0 million to $3.3 billion at March 31,
2008, from December 31, 2007. Since year end, demand deposits, including our
line of free checking products, increased $65.4 million to $1.3 billion at
March 31, 2008, and represented 38% of total deposits at that date. Core
transaction deposits, which are composed of demand deposits, money market
deposits and NOW accounts, increased $102.3 million to $2.8 billion at March
31, 2008 from December 31, 2007.
NET INTEREST INCOME
Net interest income totaled $57.9 million for the first quarter of 2008
compared to $62.9 million for the fourth quarter of 2007 and $69.4 million for
the first quarter of 2007. The decrease in net interest income compared to
the previous quarter was due mainly to lower loan yields from reductions in
our base lending rate and lower average construction loan balances. The
Federal Reserve lowered the Federal funds rate by 200 basis points since year
end, and our base lending rate was reduced by the same amount. On the funding
side, interest expense decreased $1.9 million compared to the fourth quarter
of 2007 due mostly to declining market rates and the effect such decline had
on our deposit pricing and the cost of wholesale funding through Federal Home
Loan Bank ("FHLB") advances. We continue to use FHLB advances to fund loan
growth and deposit flows as such funding has been cost effective during the
recent disruption in the financial markets.
The $11.6 million decrease in net interest income for the first quarter of
2008 compared to the same quarter of 2007 was mainly a result of reduced loan
interest income due to lower loan yields and average loan balances. Our
average loan yields have declined in line with the general decline in market
interest rates that began in September 2007. The lower average loan balances
resulted mostly from the sale of the participating interest of approximately
$353 million in commercial real estate mortgage loans at the end of March 2007
combined with our efforts to reduce our nonowner-occupied residential
construction loan exposure. Interest expense decreased $3.6 million for the
first quarter of 2008 compared to the same quarter of 2007 due mainly to a
decrease in the cost of our funding sources as market interest rates have
declined.
NET INTEREST MARGIN
Our net interest margin for the first quarter of 2008 was 5.58%, a
decrease of 53 basis points when compared to the fourth quarter of 2007 and a
decrease of 75 basis points when compared to the first quarter of 2007. The
net interest margin was 5.56% in March 2008, down from 5.91% in December 2007.
The declines in the net interest margin are due mainly to lower loan yields.
The yield on average earning assets was 7.47% for the first quarter of 2008
compared to 8.19% for the fourth quarter of 2007 and 8.44% for the first
quarter of 2007. The yield on average loans was 7.57% for the first quarter
of 2008 compared to 8.29% for the fourth quarter of 2007 and 8.55% for the
first quarter of 2007. Our average loan yield for March 2008 was 7.37%, a
decline of 73 basis points from our December 2007 loan yield of 8.10%. The
declines in loan yield resulted from reductions in our base lending rate and
lower average construction loan balances.
The cost of deposits and other funding has declined steadily with the
decrease in market interest rates. During the first quarter, we adjusted our
deposit rates downward as market rates declined. The average cost of deposits
was 1.46% for the first quarter of 2008 compared to 1.67% for the fourth
quarter of 2007 and 1.51% for the first quarter of 2007. On a monthly basis,
deposit cost declined steadily to 1.35% in March 2008 from 1.64% in December
2007. Our relatively low cost of deposits is driven by demand deposit
balances, which averaged 39% of average total deposits during the first
quarter of 2008. Further, for the first quarter of 2008 the cost of money
market deposits was 2.57%, a decline of 49 basis points from the prior
quarter, and the cost of time deposits was 3.77%, a decline of 25 basis points
from the prior quarter. The overall cost of interest-bearing liabilities
decreased to 2.87% for the first quarter of 2008 compared to 3.28% for the
fourth quarter of 2007 and 3.41% for the first quarter of 2007 due mostly to
lower market interest rates. In line with deposit cost trends, the cost of
interest bearing liabilities declined to 2.67% in March 2008 from 3.23% in
December 2007. We increased our reliance on FHLB advances during the first
quarter of 2008 as a cost-effective source to fund loan growth and deposit
flows.
NONINTEREST INCOME
Noninterest income for the first quarter of 2008 totaled $6.6 million
compared to $5.4 million in the fourth quarter of 2007 and $14.4 million
earned in the first quarter of 2007. The increase compared to the fourth
quarter of 2007 is due mostly to increased gain on sale of loans and other
income. The net gain on sale of SBA loans was $269,000 for the first quarter
of 2008 compared to a net loss of $543,000 for the fourth quarter of 2007.
Other income includes the recognition of discounts related to the payoffs of
acquired loans; such amounts were $446,000 for the first quarter of 2008 and
$187,000 for the fourth quarter of 2007.
The decrease in noninterest income compared to the first quarter of 2007
is due mostly to the sale of the participating interest in commercial real
estate mortgage loans in March 2007, which generated a gain of $6.6 million,
and net gains of $876,000 on the sale of SBA loans. The other income category
for the first quarter of 2007 included $1.9 million from the recognition of
discounts related to payoffs of acquired loans.
NONINTEREST EXPENSE
Excluding the goodwill write-off, first quarter of 2008 noninterest
expense totaled $35.3 million compared to $36.3 million for the fourth quarter
of 2007 and $35.4 million for the first quarter of 2007. The decrease in
operating noninterest expense compared to the fourth quarter of 2007 is due to
the prior quarter including a $1.4 million prepayment penalty on certain FHLB
advances, a $1.0 million donation to the San Diego Foundation, and $390,000 of
reorganization charges; there were no such items in the first quarter of 2008.
These decreases were offset, in part, by higher compensation costs.
Noninterest expense includes amortization of time-based and performance-
based restricted stock, which is included in compensation, and intangible
asset amortization. Restricted stock amortization totaled $952,000 for the
first quarter of 2008 compared to $1.2 million for the fourth quarter of 2007
and $2.1 million for the first quarter of 2007. The decline in the restricted
stock amortization compared to the first quarter of 2007 is due to the
suspension in the fourth quarter of 2007 of amortization of certain
performance-based restricted stock awards whose vesting is dependent on the
attainment of specific long-term financial targets. At that time, we
concluded that attainment of these financial targets was less than probable.
If and when the attainment of such financial targets is deemed probable in
future periods, a catch-up adjustment will be recorded and amortization of
such performance-based restricted stock will recommence. Amortization expense
for all time-based and performance-based restricted stock awards is estimated
to be $4.8 million for 2008. Intangible asset amortization totaled $2.5
million for the first quarter of 2008 and is estimated to be $9.4 million for
2008. The 2008 estimates of both restricted stock award expense and
intangible asset amortization are subject to change.
GOODWILL WRITE-OFF
As disclosed in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2007, the Company's market capitalization was less than our total
shareholders' equity at December 31, 2007. Since this trend continued through
the end of the first quarter of 2008, we are required under generally accepted
accounting principles to determine whether and to what extent our goodwill
asset is impaired. We engaged an independent valuation consultant to assist
us in evaluating a potential goodwill write-off. Based on the evaluation, we
wrote off $275.0 million of our goodwill as a non-cash charge to earnings in
the first quarter of 2008. Such charge had no effect on the Company's or the
Bank's cash balances or liquidity. In addition, because goodwill and other
intangible assets are not included in the calculation of regulatory capital,
the Company's and the Bank's well-capitalized regulatory ratios are not
affected by this non-cash expense.
TAXES
The effective tax rate on net operating earnings for the first quarter of
2008 was 26.9% compared to 41.1% for the fourth quarter of 2007 and 41.0 % for
the first quarter of 2007. The effective tax rates shown reflect reductions
for credits on certain investments and tax-exempt income. The first quarter
of 2008 goodwill write-off is not deductible for tax purposes.
CREDIT QUALITY
Credit quality was impacted mostly by three events during the first
quarter of 2008: the sale of certain nonaccrual loans, the provision for
credit losses, and the reduction in our construction loan exposure. In mid-
March we sold $34.1 million of construction related nonaccrual loans at a loss
of $16.2 million which was charged to the allowance for credit losses. These
loans were collateralized by both residential construction projects and
residential land, and we estimated that it would take several quarters to work
out these troubled credits. We decided to sell these loans at a substantial
discount in order to eliminate from our portfolio the risks presented by these
loans and to reduce the distraction their work out would have caused. The
credit loss provision for the first quarter of 2008 was $26.0 million and was
based on our reserve methodology and considered, among other factors, the
charge-off from the loan sale, the level and trends of classified, criticized,
and nonaccrual loans, portfolio concentrations and general market conditions.
The construction loan portfolio declined $55.6 million during the first
quarter of 2008 to $661.8 million at the end of March. Within our
construction loan portfolio, we reduced our exposure to nonowner-occupied
residential construction loans by $62.6 million to $287.5 million at the end
of March from year end 2007. The details regarding the nonowner-occupied
residential construction loan portfolio as of the dates indicated follows:

Balance Number of loans Average loan balance
As of As of As of
Loan Category 12/31/07 3/31/08 3/31/08 3/31/08
(Dollars in thousands) (Dollars in
thousands)
Residential land $80,848 $57,174 42 $1,361
Residential
nonowner-occupied
single family 133,694 96,381 61 1,580
Unimproved
residential
land 51,014 49,761 10 4,976
Residential
multifamily 84,533 84,215 19 4,432
$350,089 $287,531 132 $2,178

Nonperforming assets totaled $38.0 million at the end of March, up $12.8
million from the $25.3 million at the end of December. Nonaccrual loans
increased $9.5 million to $32.0 million and other real estate owned ("OREO")
increased $3.3 million to $6.1 million as of March 31, 2008. Our ratio of
nonaccrual loans to total loans, including loans held for sale, increased to
0.81% at March 31, 2008 from 0.56% at December 31, 2007. The types of loans
included in the nonaccrual category as of March 31, 2008 and December 31, 2007
follows:

Balance
As of
Loan category 12/31/07 3/31/08
(Dollars in thousands)

SBA 7(a) $7,006 $11,011
SBA 504 3,351 4,461
Residential construction 9,475 7,857
Commercial real estate 519 4,754
Commercial 1,507 3,213
Residential other 6 295
Residential land 220 220
Other, including foreign 389 144
$22,473 $31,955

The increase in OREO is due mostly to foreclosures on a land loan for 8
improved lots in Temecula and a condo project in San Diego, which combined
total $4.0 million. The ratio of nonperforming assets to loans and real
estate owned was 0.96% at March 31, 2008 compared to 0.63% at December 31,
2007.
The credit loss reserve ratio to net loans increased to 1.76% at the end
of March compared to 1.55% at the end of 2007. The allowance for credit
losses totaled $68.9 million at March 31, 2008 and $61.0 million at December
31, 2007.
No part of the allowance for credit losses is allocated to loans held for
sale as they are carried at the lower of aggregate cost or fair value and are
shown separately on our balance sheet. The allowance for credit losses
applies only to loans held for investment purposes and loan commitments.
REGULATORY CAPITAL MEASURES ARE ABOVE THE WELL-CAPITALIZED MINIMUMS
First Community and its wholly-owned banking subsidiary, Pacific Western
Bank, each remained well capitalized at March 31, 2008.

Minimum Actual
Regulatory
Requirements
Well Pacific Company
Capitalized Western Consolidated
Tier 1 leverage capital ratio 5.00% 9.09% 9.98%
Tier 1 risk-based capital ratio 6.00% 9.61% 10.55%
Total risk-based capital 10.00% 10.87% 11.80%

REINCORPORATION PROPOSAL
On March 10, 2008, First Community announced its intention to
reincorporate in Delaware from California under the name PacWest Bancorp.
Subject to the receipt of shareholder approval at the special meeting on April
23, 2008, we intend to reincorporate effective May 14, 2008 following our
Annual Meeting of Shareholders to be held on May 13, 2008.
Other than the change of the Company's name and corporate domicile, the
reincorporation would not result in any change in the business, location,
management, assets, liabilities or net worth of the Company, nor will it
result in any change in location of Company employees, including the Company's
management. Additionally, the reincorporation itself would not alter any
shareholder's ownership interest in the Company.
Additional information on the proposed reincorporation is available in the
Company's proxy statement filed with the Securities and Exchange Commission on
March 25, 2008.
ABOUT FIRST COMMUNITY BANCORP
First Community Bancorp is a bank holding company with $4.9 billion in
assets as of March 31, 2008, with one wholly-owned banking subsidiary, Pacific
Western Bank. Through 60 full-service community banking branches, Pacific
Western provides commercial banking services, including real estate,
construction and commercial loans, to small and medium-sized businesses.
Pacific Western's branches are located in Los Angeles, Orange, Riverside, San
Diego and San Bernardino Counties. Through its subsidiary BFI Business
Finance and its divisions First Community Financial and Pacific Western SBA
Lending, Pacific Western also provides working capital financing to growing
companies located throughout the Southwest, primarily in the states of
Arizona, California and Texas. Additional information regarding First
Community Bancorp is available on the Internet at
www.firstcommunitybancorp.com. Information regarding Pacific Western Bank is
also available on the Internet at www.pacificwesternbank.com.
FORWARD-LOOKING STATEMENTS
This press release contains certain forward-looking information about
First Community that is intended to be covered by the safe harbor for
"forward-looking statements" provided by the Private Securities Litigation
Reform Act of 1995. All statements other than statements of historical fact
are forward-looking statements. Such statements involve inherent risks and
uncertainties, many of which are difficult to predict and are generally beyond
the control of the Company. We caution readers that a number of important
factors could cause actual results to differ materially from those expressed
in, implied or projected by, such forward-looking statements. Risks and
uncertainties include, but are not limited to: planned acquisitions and
related cost savings cannot be realized or realized within the expected time
frame; lower than expected revenues; credit quality deterioration which could
cause an increase in the allowance for credit losses and a reduction in net
earnings; increased competitive pressure among depository institutions; the
Company's ability to complete announced acquisitions, to successfully
integrate acquired entities, or to achieve expected synergies and operating
efficiencies within expected time-frames or at all; the integration of
acquired businesses costs more, takes longer or is less successful than
expected; the possibility that personnel changes will not proceed as planned;
the cost of additional capital is more than expected; a change in the interest
rate environment reduces interest margins; asset/liability repricing risks and
liquidity risks; pending legal matters may take longer or cost more to resolve
or may be resolved adversely to the Company; general economic conditions,
either nationally or in the market areas in which the Company does or
anticipates doing business, are less favorable than expected; environmental
conditions, including natural disasters, may disrupt our business, impede our
operations, negatively impact the values of collateral securing the Company's
loans or impair the ability of our borrowers to support their debt
obligations; the economic and regulatory effects of the continuing war on
terrorism and other events of war, including the war in Iraq; legislative or
regulatory requirements or changes adversely affecting the Company's business;
changes in the securities markets; regulatory approvals for any acquisitions
cannot be obtained on the terms expected or on the anticipated schedule; and,
other risks that are described in First Community's public filings with the
U.S. Securities and Exchange Commission (the "SEC"). If any of these risks or
uncertainties materializes or if any of the assumptions underlying such
forward-looking statements proves to be incorrect, First Community's results
could differ materially from those expressed in, implied or projected by such
forward-looking statements. First Community assumes no obligation to update
such forward-looking statements.
For a more complete discussion of risks and uncertainties, investors and
security holders are urged to read First Community Bancorp's annual report on
Form 10-K, quarterly reports on Form 10-Q and other reports filed by First
Community with the SEC. The documents filed by First Community with the SEC
may be obtained at First Community Bancorp's website at
www.firstcommunitybancorp.com or at the SEC's website at www.sec.gov. These
documents may also be obtained free of charge from First Community by
directing a request to: First Community Bancorp c/o Pacific Western Bank, 275
North Brea Boulevard, Brea, CA 92821. Attention: Investor Relations.
Telephone 714-671-6800.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

March 31, December 31,
2008 2007
(In thousands, except share date)
Assets:
Cash and due from banks $129,653 $99,363
Federal funds sold - 2,000
Total cash and cash equivalents 129,653 101,363

Interest-bearing deposits in financial
institutions 286 420

Federal Home Loan Bank stock, at cost 32,768 26,649
Securities available-for-sale, at estimated
fair value 117,696 106,888
Total securities 150,464 133,537

Loans, held for sale 57,309 63,565

Loans, net of unearned income 3,909,007 3,949,218
Allowance for loan losses (60,199) (52,557)
Net loans 3,848,808 3,896,661

Premises and equipment 25,702 26,327
Other real estate owned, net 6,055 2,736
Intangible assets 528,171 805,775
Cash surrender value of life insurance 68,598 67,846
Other assets 77,670 80,810
Total assets $4,892,716 $5,179,040

Liabilities and Shareholders' Equity:
Liabilities:
Noninterest-bearing deposits $1,277,302 $1,211,946
Interest-bearing deposits 2,041,842 2,033,200
Total deposits 3,319,144 3,245,146

Accrued interest payable and other liabilities 45,286 45,054
Borrowings 539,800 612,000
Subordinated debentures 130,173 138,488
Total liabilities 4,034,403 4,040,688

Shareholders' Equity:
Common stock 937,559 936,608
Retained earnings (accumulated deficit) (80,333) 201,220
Accumulated other comprehensive income:
Unrealized gain on securities
available-for-sale, net 1,087 524
Total Shareholders' Equity 858,313 1,138,352
Total Liabilities and Shareholders'
Equity $4,892,716 $5,179,040

Shares outstanding (including 999,189 shares
and 861,269 shares at March 31, 2008 and
December 31, 2007, underlying unvested
stock awards) 28,147,608 28,002,382

Book value per share $30.49 $40.65

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

Quarters Ended
3/31/08 12/31/07 3/31/07
(In thousands, except per share data)
Interest income:
Interest and fees on loans $75,653 $82,742 $90,949
Interest on federal funds sold 40 251 214
Interest on time deposits in
other financial institutions 3 4 6
Interest on investment securities 1,701 1,358 1,376
Total interest income 77,397 84,355 92,545

Interest expense:
Interest expense on deposits 11,821 14,391 13,425
Interest expense on borrowings 5,307 4,306 6,752
Interest expense on subordinated
debentures 2,409 2,715 2,933
Total interest expense 19,537 21,412 23,110
Net interest income before
provision for credit losses 57,860 62,943 69,435
Provision for credit losses 26,000 3,000 -
Net interest income after
provision for credit losses 31,860 59,943 69,435

Noninterest income:
Service charges on deposit
accounts 3,224 3,029 2,817
Other commissions and fees 1,519 1,817 1,323
Gain (loss) on sale of loans 269 (543) 7,525
Increase in cash surrender value
of life insurance 587 649 616
Other income 968 400 2,070
Total noninterest income 6,567 5,352 14,351

Noninterest expense:
Compensation 18,846 16,669 18,922
Occupancy 4,731 4,871 4,761
Furniture and equipment 1,139 1,183 1,293
Data processing 1,543 1,475 1,558
Other professional services 1,415 1,495 1,437
Business development 756 1,709 707
Communications 824 779 832
Insurance and assessments 540 464 413
Intangible asset amortization 2,530 2,621 2,174
Reorganization charges - 390 258
Goodwill write-off 275,000 - -
Other 2,986 4,689 3,038
Total noninterest expense 310,310 36,345 35,393
(Loss) earnings before income
taxes (271,883) 28,950 48,393
Income taxes 840 11,891 19,847
Net (loss) earnings $272,723 $17,059 $28,546

Per share information
Number of shares (weighted average):
Basic 27,145.2 27,645.0 28,867.2
Diluted 27,145.2 27,703.0 28,995.1
(Loss) earnings per share
Basic (loss) earnings per
share $(10.05) $0.62 $0.99
Diluted (loss) earnings
per share $(10.05) $0.62 $0.98

Net operating earnings per share:
Basic net operating earnings
per share $ 0.08 $0.62 $0.99
Diluted net operating earnings
per share $ 0.08 $0.62 $0.98

UNAUDITED AVERAGE BALANCE SHEETS Quarters Ended
3/31/08 12/31/07 3/31/07
(Dollars in thousands)
Average Assets:
Loans, net of unearned income $4,019,224 $3,960,621 $4,316,266
Investment securities 143,379 105,995 113,278
Federal funds sold 5,032 21,437 16,590
Interest-bearing deposits in
financial institutions 324 425 486
Average earning assets 4,167,959 4,088,478 4,446,620
Other assets 1,030,130 1,037,646 1,061,067
Average total assets $5,198,089 $5,126,124 $5,507,687

Average Liabilities and Shareholders' Equity:
Average liabilities
Noninterest-bearing deposits $1,273,173 $1,332,259 $1,530,242

Interest checking 369,841 363,756 274,303
Money market accounts 1,089,672 1,182,456 1,089,677
Savings 104,905 113,398 138,517
Time deposits 413,712 423,668 571,930
Interest-bearing deposits 1,978,130 2,083,278 2,074,427
Average deposits 3,251,303 3,415,537 3,604,669
Subordinated debentures 137,829 138,553 149,173
Borrowings 620,349 366,196 528,490
Other liabilities 50,207 50,339 56,959
Average liabilities 4,059,688 3,970,625 4,339,291
Average equity 1,138,401 1,155,499 1,168,396
Average liabilities and
shareholders' equity $5,198,089 $5,126,124 $5,507,687

Yield Analysis:
Average earning assets $4,167,959 $4,088,478 $4,446,620
Yield 7.47% 8.19% 8.44%
Average interest-bearing
deposits $1,978,130 $2,083,278 $2,074,427
Yield 2.40% 2.74% 2.62%
Average deposits $3,251,303 $3,415,537 $3,604,669
Cost 1.46% 1.67% 1.51%
Average interest-bearing
liabilities $2,736,308 $2,588,027 $2,752,090
Cost 2.87% 3.28% 3.41%
Average subordinated debentures 137,829 138,553 149,173
Cost 7.03% 7.77% 7.97%
Average borrowings 620,349 366,196 528,490
Cost 3.44% 4.67% 5.18%
Average interest sensitive
liabilities $4,009,481 $3,920,286 $4,282,332
Cost 1.96% 2.17% 2.19%

Interest spread 4.60% 4.89% 5.03%
Net interest margin 5.58% 6.11% 6.33%

DEPOSITS (unaudited)
As of the Dates Indicated
3/31/08 12/31/07 3/31/07
(Dollars in thousands)
Transaction accounts:
Demand deposits $1,277,302 $1,211,946 $1,524,895
Interest checking 373,145 366,191 273,270
Total transaction accounts 1,650,447 1,578,137 1,798,165
Non-transaction accounts:
Money market 1,165,336 1,135,307 1,182,324
Savings 100,505 108,223 136,822
Time deposits under $100,000 136,476 138,750 227,387
Time deposits over $100,000 266,379 284,729 334,324
Total non-transaction
accounts 1,668,696 1,667,009 1,880,857
Total deposits $3,319,143 $3,245,146 $3,679,022

LOAN CONCENTRATION (unaudited)
As of the Dates Indicated
3/31/08 12/31/07 9/30/07 6/30/07 3/31/07
(Dollars in thousands)
Loan Category:
Domestic:
Commercial * $855,228 $858,708 $864,114 $882,426 $792,877
Real estate-
construction 661,782 717,419 795,272 839,564 918,086
Commercial real
estate-mortgage * 2,361,365 2,335,099 2,144,323 2,124,225 2,124,768
Consumer 47,506 49,943 48,550 46,355 46,755
Foreign:
Commercial 48,737 59,916 57,538 69,236 75,548
Other 906 1,206 5,879 5,848 6,342
Total gross loans,
including loans
held for sale $3,975,524 $4,022,291 $3,915,676 $3,967,654 $3,964,376

*Commercial and commercial real estate-mortgage include loans held for
sale.

COMPONENTS OF ALLOWANCE FOR
CREDIT LOSSES, NONPERFORMING
ASSETS AND CREDIT
QUALITY MEASURES (Unaudited)
As of or for the:
Quarter Ended Year Ended Quarter Ended
3/31/08 12/31/07 3/31/07
(Dollars in thousands)
ALLOWANCE FOR CREDIT LOSSES:
Allowance for loan losses $60,199 $52,557 $50,352
Reserve for unfunded loan
commitments 8,671 8,471 8,271
Allowance for credit losses $68,870 $61,028 $58,623

NONPERFORMING ASSETS:
Nonaccrual loans $31,955 $22,473 $27,572
Other real estate owned 6,055 2,736 479
Total nonperforming assets $38,010 $25,209 $28,051

Allowance for credit losses
to loans, net of unearned
income 1.76% 1.55% 1.54%
Allowance for credit losses
to nonaccrual loans 215.52% 271.6% 212.6%
Allowance for credit losses
to nonperforming assets 181.19% 242.1% 209.0%
Nonperforming assets to
total loans, including
loans held for sale,
and other real estate owned 0.96% 0.63% 0.71%
Nonaccrual loans to total
loans, including loans held
for sale 0.81% 0.56% 0.70%

ALLOWANCE FOR CREDIT LOSSES ROLLFORWARD
AND NET CHARGE-OFF MEASUREMENT (unaudited)
As of or for the:
Quarter Ended Year Ended Quarter Ended
3/31/08 12/31/07 3/31/07
(Dollars in thousands)
Balance at beginning of period $61,028 $61,179 $61,179
Loans charged-off:
Commercial (108) (2,091) (463)
Real estate-construction (17,565) (660) -
Real estate-mortgage (838) (454) (22)
Consumer (38) (166) (36)
Foreign - (1,414) -
Total loans charged-off (18,549) (4,785) (521)

Recoveries on loans charged-off:
Commercial 356 1,591 162
Real estate-mortgage 26 163 -
Consumer 9 122 103
Foreign - 73 -
Total recoveries on loans
charged-off 391 1,949 265
Net (charge-offs) recoveries (18,158) (2,836) (256)
Provision for credit losses 26,000 3,000 -
Reduction for loans sold - (2,461) (2,300)
Additions due to acquisitions - 2,146 -
Balance at end of period $68,870 $61,028 $58,623

Annualized net (charge-offs)
recoveries to average loans (1.82%) (0.07%) (0.02%)

The Company has disclosed in this release certain non-GAAP financial
measures to provide meaningful supplemental information regarding the
Company's operational performance and to enhance investor's overall
understanding of the Company's operating financial performance. Management
believes that these non-GAAP financial measures allow for additional
transparency and are used by some investors, analysts and other users of the
Company's financial information as performance measures. These non-GAAP
financial measures are presented for supplemental informational purposes only
for understanding the Company's operating results and should not be considered
a substitute for financial information presented in accordance with GAAP.
These non-GAAP financial measurers presented by the Company may be different
from non-GAAP financial measures used by other companies. The following table
presents performance ratios in accordance with GAAP and a reconciliation of
the non-GAAP financial measurements to the GAAP financial measurements.

Non GAAP Measurements (Unaudited)

Quarter Ended Quarter Ended Quarter Ended
In thousands, except per March 31, 2008 December 31, March 31, 2007
share data and percentages 2007

Net (loss) earnings as
reported $(272,723) $17,059 $28,546
Goodwill write-off 275,000 - -
Net operating earnings $2,277 $17,059 $28,546

GAAP basic shares
outstanding 27,145.2 27,645.0 28,867.2
Effect of restricted stock
and dilutive stock options (a) - 58.0 127.9
GAAP diluted shares
outstanding 27,145.2 27,703.0 28,995.1

Operating earnings basic
shares outstanding 27,145.2 27,645.0 28,867.2
Effect of restricted stock
and dilutive stock options 18.1 58.0 127.9
Operating earnings diluted
shares outstanding 27,163.3 27,703.0 28,995.1

GAAP basic and diluted
earnings (loss) per share $(10.05) $0.62 $0.98
Net operating diluted
earnings per share $0.08 $0.62 $0.98

GAAP return on average assets (21.10%) 1.32% 2.10%
Net operating return on
average assets 0.18% 1.32% 2.10%

GAAP return on average equity (96.35%) 5.86% 9.91%
Net operating return on
average equity 0.80% 5.86% 9.91%

Noninterest expense as
reported $310,310 $36,345 $35,393
Goodwill write-off (275,000) - -
Operating noninterest expense $35,310 $36,345 $35,393

GAAP efficiency ratio 481.6% 53.2% 42.2%
Net operating efficiency ratio 54.8% 53.2% 42.2%

(a) Anti-dilutive for the quarter ended March 31, 2008.

SOURCE First Community Bancorp

Matthew P. Wagner, Chief Executive Officer, +1-310-728-1020, Fax,
+1-310-201-0498, or Victor R. Santoro, Executive Vice President and Chief
Financial Officer, +1-310-728-1021, Fax, +1-310-201-0498, both of First
Community Bancorp