CommerceWest Bank Reports Increased Earnings for the Year, Favorable Loan Growth, Cost of Funds and Expense Management Trends

CommerceWest Bank (OTCBB: CWBK) reported earnings for the three months ended December 31, 2011 of $402,000 or $0.09 per basic common share and $0.09 per diluted common share, compared with net income of $36,000 or $0.01 per basic common share and $0.01 per diluted common share for the three months ended December 31, 2010, an increase of 800%. Net income for the twelve months ended December 31, 2011 was $1,406,000 or $0.32 per basic common share and $0.32 per diluted common share, compared with net income of $546,000 or $0.12 per basic common share and $0.12 per diluted common share for the twelve months ended December 31, 2010, an increase of 167%.

Financial performance highlights for the three months ended December 31, 2011:

• Loan growth of 8.50% as of December 31, 2011 as compared to September 30, 2011
• Cost of funds reduced 17% for the three months ended December 31, 2011 as compared to the three months ended December 31, 2010
• Non-interest expense reduction of 11% for the three months ended December 31, 2011 as compared to the three months ended December 31, 2010
• Earnings growth of 44% for the three months ended December 31, 2011 as compared to the three months ended September 30, 2011

Financial performance highlights for the twelve months ended December 31, 2011:

• 158% increase in net income year over year
• 18% increase in non-interest income year over year
• 13% increase in non-interest bearing deposits year over year
• Allowance for loan losses as a percent of CommerceWest Bank loans was 2.63%
• A fortress balance sheet, with a tier 1 leverage ratio of 13.75% and total risk based capital ratio of 22.51%
• Nonaccrual loans as a percent of total assets are 0.85% down from 1.71% or 51% year over year
• Strong liquidity with $116 million in cash and liquid investment securities

Mr. Ivo Tjan, Chairman and CEO, commented, "Management is pleased with the year end 2011 financial results for the Bank. The Bank made tremendous progress reducing the level of classified assets in 2011. The reduction in problem loan levels has allowed the team to focus more on a balanced approach of offense and defense. The results are evidenced by loan growth in the fourth quarter. Loans outstanding increased by $11.7 million or 8.50% from the previous quarter end."

Mr. Tjan continued, "We are optimistic about 2012. The runway is clear and we will execute on our strategy of organic growth. It's a simple plan of just getting back to the basics of banking. Our balance sheet is poised to bring in new profitable clients and cross sell products to our existing clients that will save them time and money to support client retention."

Total assets decreased $5.6 million as of December 31, 2011, a decrease of 2% as compared to the same period one year ago. Total loans decreased $9.1 million as of December 31, 2011, a decrease of 6% over the prior year. The Bank added $11.7 million or 8.50% to outstanding loans in the fourth quarter. Cash and due from banks decreased $27.1 million or 41%. Total investments increased $32.0 million or 51% from the prior year.

Total deposits decreased $8.5 million as of December 31, 2011, a decrease of 3% from December 31, 2010. However, of note is the Bank's increase in non-interest bearing deposits as a percent of total deposits from year over year. Non-interest bearing deposits as a percent of total deposits on December 31, 2010 were 26%. Non-interest bearing deposits as a percent of total deposits increased to 31% as of December 31, 2011, an increase of 19%. "As I mentioned in my third quarter comments," said CEO Ivo Tjan, "with the lack of robust loan demand or attractive investment options, coupled with a flat interest rate environment for the foreseeable future, we reviewed our depository accounts during the third quarter. Our goal was to reduce the number of transactional accounts, defined as high rate accounts with no other relationship with the Bank or no opportunities for future relationship growth. These accounts are not advantageous or profitable in this environment. We continued to execute on this strategic initiative in the fourth quarter, which resulted in the Bank improving its NIM, lowered our cost of funds, and improved the company's overall profitability. Our strategy now in 2012 is to organically grow our deposit base by applying this discipline."

Non-interest expense trends for the last three quarters are favorable, as management remains focused on improving the efficiency ratio. Noninterest expense was down 8% for the three months ended June 30, 2011 as compared to the three months ended March 31, 2011, noninterest expense was down 5% for the three months ended September 30, 2011 as compared to the three months ended June 30, 2011, and noninterest expense was down 1% for the three months ended December 31, 2011 as compared to the three months ended September 30, 2011.

Total nonperforming assets decreased $3.2 million as of December 31, 2011, a decrease of 44% as compared to the same period one year ago. Provision for loan losses for the twelve months ended December 31, 2011 was $190,000 compared to $2,840,000 for the twelve months ended December 31, 2010, a decrease of 93%. The Bank's allowance for loan losses as a percent of total loans was 2.63% for the CommerceWest Bank portfolio on December 31, 2011 as compared to 4.36% on December 31, 2010, a decrease of 40%.

Non-interest income for the three months ended December 31, 2011 was $432,000 compared to $501,000 for the same period last year, a decrease of 14%. Non-interest income for the twelve months ended December 31, 2011 was $1.9 million compared to $1.7 million for the same period last year, an increase of 18%.

Capital ratios for the Bank remain well above the levels required for a "well capitalized" institution as designated by regulatory agencies. As of December 31, 2011, the leverage ratio was 13.75%, the tier 1 capital ratio was 21.25%, and the total risk-based capital ratio was 22.51%.

CommerceWest Bank is headquartered at 2111 Business Center Drive in Irvine, CA, with Regional Offices in Orange County, Riverside County, Los Angeles County and San Diego County. We are a full service business bank and offer a wide range of commercial banking services, including concierge services, remote deposit solution, full-service internet banking, lines of credit, term loans, commercial real estate lending, SBA lending, and full cash management.

Mission Statement: CommerceWest Bank will create a complete banking experience for each client, catering to businesses and their specific banking needs, while accommodating our clients and providing them high-quality, low stress and personally tailored banking and financial services.

Please visit www.cwbk.com to learn more about the bank. "BANK ON THE DIFFERENCE"

Statements concerning future performance, developments or events, expectations for growth and income forecasts, and any other guidance on future periods, constitute forward-looking statements that are subject to a number of risks and uncertainties.Actual results may differ materially from stated expectations.Specific factors include, but are not limited to, loan production, balance sheet management, expanded net interest margin, the ability to control costs and expenses, interest rate changes, financial policies of the United States government and general economic conditions.The Company disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any forward-looking statements contained in this release to reflect future events or developments.