WHITTIER, Calif., July 24 /PRNewswire-FirstCall/ -- Friendly Hills Bank (OTC Bulletin Board: FHLB) reported results for the second quarter of 2008, its seventh full quarter of operations, since opening on September 18, 2006. As of June 30, 2008, the bank reported total assets of $55.5 million, a 22% increase from $45.5 million as of December 31, 2007.

The bank's overall deposit base has grown over 34% in the current year from $31.0 million as of December 31, 2007, to $41.6 million as of June 30, 2008. Non-interest bearing core deposits continue to form a substantial part of the deposit base (35%) growing from $12.9 million at year-end to $14.5 million as of June 30, 2008. During the same time period interest bearing deposits advanced over 50% from $18.0 million to $27.1 million on June 30, 2008. The bank has no deposits which were sourced through brokers or originated on the basis of above-market rate programs.

The bank's loan portfolio, net of an allowance for loan losses, also continued to grow, increasing over 61% from $18.3 million as of December 31, 2007, to $29.5 million as of June 30, 2008. The portfolio remains diversified with $8.9 million or 32% in Commercial & Industrial Loans to local businesses and $14.6 million or 49.5% in Commercial Real Estate Loans. Owner Occupied properties represent the largest component of the Commercial Real Estate Portfolio (over 52%) with $7.6 million outstanding as of June 30, 2008. The bank has an additional $14.3 million in unfunded loan commitments and no non- performing loans or residential 'sub-prime' mortgage loans.

The bank's primary generator of income is Net Interest Income which increased by over 65% from $693,563 in the six months ending June 30, 2007, to $1,146,744 in the six months ending June 30, 2008. This increase was a contributing factor in the bank reducing its net loss by 28% from $607,229, or ($0.38) per share of common stock for the six months ending June 30, 2007, to $438,919, or ($0.27) per share of common stock.