Commonwealth Business Bank Reports $261,000 or $0.08 Per Diluted Share for the Second...

Commonwealth Business Bank Reports $261,000 or $0.08 Per Diluted Share for the Second Quarter 2008

LOS ANGELES--(Business Wire)--
Commonwealth Business Bank (OTCBB:CWBB) today reported diluted
earning per share of $0.08 for the second quarter 2008, compared to $
0.13 for both the first quarter 2008 and the second quarter 2007.

"Our core operating income (excluding the impact of provision for
credit losses) for the second quarter 2008 was better than the first
quarter," noted Wun Hwa (Jack) Choi, President & CEO. "First quarter
noninterest income included a gain on sale of the unguaranteed portion
of the SBA loans which we recorded for the first time. Our service
charge and fee income for the second quarter were higher than that of
the preceding quarter."

At June 30, 2008, total assets were $287.9 million compared to
$272.4 million in the first quarter and $228.3 million for the first
quarter of 2007. Gross loans increased by $10.3 million or 4.7 percent
to $230.2 million at June 30, 2008, compared to $219.9 million at
March 31, 2008 and by $65.8 million when compared to $164.4 million
reported in the first quarter of 2007. Total deposits increased by
$15.5 million or 7.1 percent to $234.6 million as of June 30, 2008,
from $219.1 million reported last quarter. Total deposits increased by
$49.5 million or 26.7 percent when compared to $185.1 million reported
in the first quarter of 2007.

For the three months ended June 30, 2008, net interest income
before provision for credit losses totaled $2.32 million, compared to
$2.27 million for the preceding quarter. While loan volume grew, the
net interest margin experienced further compression at 3.48 percent
compared to 3.58 percent reported in the previous quarter. Although
our service charges and fee income increased, the total noninterest
income decreased to $354,000 from $631,000 reported in the first
quarter. This was due to an unordinary gain on sale of the
unguaranteed portion of the SBA loans that was booked during the first
quarter. Noninterest expenses also increased by $142,000 or 7.9
percent to $1.9 million as the Bank continued to expand and hired
additional manpower. The expenses for the credit losses, however,
decreased by $128,000 or to $259,000 when compared to the previous
quarter. Net income for the second quarter of 2008 was $261,000,
compared with $422,000 reported for the first quarter 2008. Return on
average assets (ROA) and return on average equity (ROE) for the second
quarter of 2008 decreased to 0.38 percent and 2.51 percent,
respectively, from 0.65 percent and 4.07 percent, respectively, of the
first quarter 2008.

For the six months ended June 30, 2008, net interest income
totaled $4.59 million, compared to $ 4.58 million reported in the
corresponding period in 2007. Noninterest income in the first six
months of 2008 increased to $985,000 from $820,000 of the comparable
period in 2007. Noninterest expense for the first six months of 2008
also increased to $3.7 million, compared with a $3.5 million increase
in the corresponding period in 2007. However, non-interest expense as
a percentage of average earning assets in the first six month of 2008
was lower at 2.91 percent, compared with 3.36 percent for the same
period a year ago. We reserved $646,000 in provision for credit losses
during the first half of 2008. This represented an increase of
$294,000 compared to the corresponding period a year ago. Net income
for the six-month period in 2008 totaled $683,000, equal to $0.21 per
diluted share. This compared to net income of $1,005,000, or $0.32 per
diluted share, in the same period of 2007. This was primarily due to
an increase in provision for credit losses and overhead expenses. ROA
and ROE for the first half of 2008 equaled 0.51 percent and 3.29
percent, respectively. For the first six months of 2007, ROA and ROE
was 0.94 percent and 5.08 percent, respectively.

"During the second quarter, financial institutions continued to be
challenged by pervasive asset quality problems and dwindling
profitability. Unfortunately, the problem is far from over," commented
CEO and President Wun Hwa (Jack) Choi. "Despite the slowing economy
and the adverse financial condition, our asset quality remains sound.
Given the overall market conditions, I am pleased with our second
quarter performance. Our core operating income and total assets grew
moderately. Also, the launching of our third branch in Irvine has been
successful. We continue to be vigilant in monitoring our credit
portfolio in consideration of further deterioration in macro economic
conditions. Until the real estate market stabilizes, we will remain
cautious. With the expertise of our seasoned staff, I am certain that
we have the capability and acumen to overcome the challenges," said
Wun Hwa (Jack) Choi, President and CEO.

Mr. Choi added that "We are optimistic about the regulatory
approval of the Hana Financial Group's investment. We are putting a
concerted effort towards expediting the approval process and although
currently the exact date is unknown, we expect to conclude the deal
soon."

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*T
BALANCE SHEETS (Unaudited)
($ in thousands)

As of As of As of
06/30/2008 3/31/2008 06/30/2007
Cash & Due From Banks $ 8,479 $ 3,666 $ 4,770
Interest-Bearing Due From Banks 0 0 4,455
Fed Funds Sold 13,270 13,500 23,350
Investment Securities 30,795 30,068 27,513
Loans, net of Deferred Fees 230,225 219,925 164,422
Allowance for Loan Losses (2,874) (2,734) (1,669)
Net Loans 227,351 217,191 162,753
Premises and Equipments, Net 1,804 1,751 1,538
Accrued Interest Receivable 1,079 1,199 1,074
Customer Liability on Acceptances 37 435 565
Other Assets 5,071 4,559 2,328
TOTAL ASSETS $ 287,886 $272,369 $ 228,346

Non-interest-Bearing Deposits $ 32,696 $ 27,552 $ 24,683
Interest-Bearing Deposits 201,901 191,507 160,458
Total Deposits 234,597 219,059 185,141
FHLB Advance 9,000 9,000 0
Accrued Interest Payable 1,303 1,113 1,094
Bank Liability on Acceptances 37 435 565
Other Liabilities 1,297 1,293 1,226
TOTAL LIABILITY 246,234 230,900 188,026
Total Shareholders' Equity 41,652 41,469 40,320
TOTAL LIAB & SHAREHOLDERS' EQUITY $ 287,886 $272,369 $ 228,346
*T

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*T
STATEMENTS OF INCOME (Unaudited)
($ in thousands, except per share amounts)

Three Months Ended
06/30/2008 3/31/2008 06/30/2007
---------- --------- ----------
Interest Income $ 4,207 $ 4,376 $ 4,329
Interest Expense 1,884 2,110 1,927
Net Interest Income 2,323 2,266 2,402
Provision for Loan Losses 259 387 35
Non Interest Income 354 631 414
Non Interest Expense 1,942 1,800 1,817
Income Before Income Taxes 476 710 964
Income Tax Provision 215 288 524
NET INCOME 261 422 440
Basic EPS 0.08 0.14 0.14
Diluted EPS 0.08 0.13 0.13

INCOME STATEMENT RATIOS
ROA 0.38% 0.65% 0.80%
ROE 2.51% 4.07% 4.37%
Net Interest Margin 3.48% 3.58% 4.52%
Efficiency Ratio 72.54% 62.13% 64.52%
*T

-0-
*T
STATEMENTS OF INCOME (Unaudited)
($ in thousands, except per share amounts)

Six Months Ended
06/30/2008 06/30/2007
---------- ----------
Interest Income $ 8,583 $ 6.994
Interest Expense 3,994 3.707
Net Interest Income 4,589 4,577
Provision for Loan Losses 646 294
Non Interest Income 985 820
Non Interest Expense 3,742 3,480
Income Before Income Taxes 1,186 1,623
Income Tax Provision 503 618
NET INCOME 683 1,005
Basic EPS 0.22 0.33
Diluted EPS 0.21 0.32

INCOME STATEMENT RATIOS
ROA 0.51% 0.94%
ROE 3.29% 5.08%
Net Interest Margin 3.56% 4.41%
Efficiency Ratio 67.13% 64.48%
*T

The Bank's Call Reports are available for review or download
directly from the FDIC website at www.fdic.gov, or through the link at
the Bank's website at www.cwbbank.com.

Certain matters discussed in this press release constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements involve known and unknown risks, uncertainties and factors
such as: (1) the impact of changes in interest rates, (2) fluctuation
in economic conditions, (3) competition in the Bank's defined market,
(4) the Bank's ability to sustain its internal growth rate and to
preserve its earning assets quality, and (5) government regulations.
Although the Bank believes the expectations reflected in these
forward-looking statements are reasonable, it can give no assurance
that these expectations will prove to have been correct.

Commonwealth Business Bank
K. Kaye Kim, CFO, 323-988-3007
Kayek@cwbbank.com

Copyright Business Wire 2008