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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM
10-K
 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2010
 Commission File Number 000-52584
 BIRMINGHAM BLOOMFIELD BANCSHARES, INC.
  Michigan
    
    20-3993452(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 33583 Woodward Avenue, Birmingham. MI 48009  (Address of principal executive offices, including zip code)
 (248) 723-7200  (Registrants telephone number, including area code)
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TABLE OF CONTENTS  PART IITEM 1. BusinessITEM 1A. Risk FactorsITEM 1B. Unresolved Staff CommentsITEM 2. PropertiesITEM 3. Legal ProceedingsITEM 4. ReservedPART IIITEM 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesITEM 6. Selected Financial DataITEM 7. Managements Discussion and Analysis of Financial Condition and Results of OperationsITEM 7A. Quantitative and Qualitative Disclosures about Market RiskITEM 8. Financial Statements and Supplemental DataITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial DisclosureITEM 9A. Controls and ProceduresITEM 9B. Other InformationPART IIIITEM 10. Directors, Executive Officers and Corporate GovernanceITEM 11. Executive CompensationITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersITEM 13. Certain Relationships and Related Transactions, and Director IndependenceITEM 14. Principal Accounting Fees and ServicesITEM 15. Exhibits and Financial Statement SchedulesSIGNATURESExhibit IndexEX-13EX-21EX-23EX-31.1EX-31.2EX-32.1EX-99.1EX-99.2    Table of Contents  Documents Incorporated by Reference:
  .
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Disclosure Regarding Forward Looking Statements
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BIRMINGHAM BLOOMFIELD BANCSHARES, INC.
 
 PART I
 
 ITEM 1. Business
 Overview
  Philosophy and strategy
   
    
    Capitalizing on the diverse community involvement, professional expertise and
personal and business contacts of our directors, organizers and executive officers;
 
    
    Hiring and retaining experienced and qualified banking personnel;
 
    
    Providing individualized attention with consistent, local decision-making authority;
 
    
    Utilizing technology and strategic outsourcing to provide a broad array of
convenient products and services;
 
    
    Operating from highly visible and accessible banking offices in close proximity to a
concentration of targeted commercial businesses and professionals;
    
    Attracting its customer base by offering competitive interest rates on deposit accounts.
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Market opportunities
  Local economy
   Competition
  5




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Business strategy
 Management philosophy
 Operating strategy
 
    
    Experienced senior management. The Banks senior management possesses extensive
experience in banking industry, as well as substantial business and banking contacts in
our primary service areas.
 
    
    Quality employees. Bank of Birmingham will strive to hire highly trained and
seasoned staff.
 
    
    Community-oriented board of directors. All of the Banks directors are either
experienced bankers or local business and community leaders. Most have significant
business ties to the Banks primary service areas, enabling them to be sensitive and
responsive to the needs of the community. Additionally, the board of directors
represents a wide variety of business experience and community involvement.
 
    
    Highly visible sites. The main office is highly visible and located in close
proximity to major traffic arteries. The main office is located at 33583 Woodward
Avenue, Birmingham, Michigan in an area that provides easy access to potential banking
customers traveling in the Birmingham area. We believe that this site gives the Bank a
highly visible presence in a market that is dominated by branch offices of banks
headquartered out of the area. We believe this enhances the Banks image as a strong
competitor.
 
    
    Individual customer focus. Bank of Birmingham focuses on providing individual
service and attention to our target customers, which include local businesses,
professionals and individuals. The Banks products and services are delivered
personally though one full-service offices and supported by effective technical and
non-technical service delivery systems. Clients will enjoy the convenience of on-site
visits by the Banks business relationship managers, a courier service for non-cash
deposits and business consultation services.
 
    
    Financial and information center.Bank of Birmingham serves as a financial and
information center for the community, and will assemble and sponsor professionals to
conduct seminars and workshops on a variety of subjects of interest to assist members
of our community in developing or enhancing their personal and professional
effectiveness.
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Growth strategies
 
    
    Capitalize on community orientation. We are capitalizing on the Banks position as
an independent, locally-owned community bank to attract individuals, professionals and
local business customers that may be underserved by larger banking institutions in our
market area.
 
    
    Emphasize local decision-making. The Bank emphasizes local decision-making by
experienced bankers. This will help the Bank attract local businesses and
service-minded customers.
 
    
    Attract experienced lending officers. Bank of Birmingham has hired experienced,
well-trained lending officers capable of soliciting loan business immediately.
 
    
    Offer fee-generating products and services. The Banks range of services, pricing
strategies, interest rates paid and charged and hours of operation are structured to
attract its target customers and increase its market share. Bank of Birmingham strives
to offer the small business person, professional, entrepreneur and consumer the best
loan services available while charging competitively for these services and utilizing
technology and strategic outsourcing to increase fee revenues.
 Lending services
 Lending policy
  Lending limits
 
    
    15% of the Banks capital and surplus; or
 
    
    upon a 2/3 vote of the Banks board of directors, 25% of its capital and surplus.
 Credit risks
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Real estate loans
 
    
    Commercial real estate. Commercial real estate loan terms generally will be limited
to five years or less, although payments may be structured on a longer amortization
basis. Interest rates may be fixed or adjustable. The Bank generally will require
personal guarantees from the principal owners of the property supported by a review by
Bank management of the principal owners personal financial statements. Risks
associated with commercial real estate loans include fluctuations in the value of real
estate, new job creation trends, tenant vacancy rates and the quality of the borrowers
management. The Bank will limit its risk by analyzing borrowers cash flow and
collateral value on an ongoing basis.
 
    
    Construction and development loans. Bank of Birmingham will consider making
owner-occupied construction loans with a pre-approved take-out loan. The Bank will
also consider construction and development loans on a pre-sold basis. If the borrower
has entered into an agreement to sell the property prior to beginning construction,
then the loan is considered to be on a pre-sold basis. If the borrower has not entered
into an agreement to sell the property prior to beginning construction, then the loan
is considered to be on a speculative basis. Construction and development loans are
generally made with a term of six to twelve months and interest is paid quarterly. The
ratio of the loan principal to the value of the collateral as established by
independent appraisal typically will not exceed industry standards. Speculative loans
will be based on the borrowers financial strength and cash flow position. Loan
proceeds will be disbursed based on the percentage of completion and only after the
project has been inspected by an experienced construction lender or third-party
inspector. Risks associated with construction loans include fluctuations in the value
of real estate and new job creation trends.
 
    
    Residential real estate. The Banks residential real estate loans will consist of
residential second mortgage loans, residential construction loans and traditional
mortgage lending for one-to-four family residences. The Bank expects that any
long-term fixed rate mortgages will be underwritten for resale to the secondary market.
It will offer primarily adjustable rate mortgages. The majority of fixed rate loans
will be sold in the secondary mortgage market. All loans will be made in accordance
with our appraisal policy with the ratio of the loan principal to the value of
collateral as established by independent appraisal not exceeding 80%, unless the
borrower has private mortgage insurance.Commercial loans. Bank of Birmingham expects that loans for commercial purposes in
various lines of businesses will be one of the larger components of the Banks loan portfolio. The
target commercial loan market will be small- to medium-sized businesses and the business
professional market. The terms of these loans will vary by purpose and by type of underlying
collateral. The commercial loans will primarily be underwritten on the basis of the borrowers
ability to service the loan from income. The Bank will typically make equipment loans for a term
of five years or less at fixed or variable rates, with the loan fully amortized over the term.
Loans to support working capital will typically have terms not exceeding one year and will usually
be secured by accounts receivable, inventory or personal guarantees of the principals of the
business. For loans secured by accounts receivable or inventory, principal will typically be
repaid as the assets securing the loan are converted into cash, and for loans secured with other
types of collateral, principal will typically be due at maturity. The quality of the commercial
borrowers management and its ability both to properly evaluate changes in the supply and demand
characteristics affecting its markets for products and services and to effectively respond to such
changes are significant factors in a commercial borrowers creditworthiness.
 Consumer loans
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Investments
  Asset and liability management
  Deposit services
  Other banking services
  Employees
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SUPERVISION AND REGULATION
 General
      The Corporation
 General .
 Investments and Activities .
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Capital Requirements .
    11




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Dividends .
   Recent Developments .
   12




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The Bank
 General .
 Business Activities .
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Branching .
 de novo
 Loans to One Borrower .
 Enforcement .
  Assessments and Fees .
 Regulatory Capital Requirements .
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Prompt Corrective Regulatory Action .
   Deposit Insurance .
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Payment of Dividends by the Bank
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Loans to Directors, Executive Officers, and Principal Shareholders .
 Certain Transactions with Related Parties .
  Standards for Safety and Soundness .
 Reserve Requirement .
 
    
    for transaction accounts totaling $10.7 million or less, a reserve of 0%; and
 
    
    for transaction accounts in excess of $10.7 million up to and including $58.8 million, a
reserve of 3%; and for transaction accounts totaling in excess of $58.8 million, a reserve
requirement of $1.443 million plus 10% of that portion of the total transaction accounts
greater than $58.8 million.
  
 ITEM 1A. Risk Factors
  
 ITEM 1B. Unresolved Staff Comments.
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ITEM 2. Properties.
    
 ITEM 3. Legal Proceedings.
  
 ITEM 4. Reserved.
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PART II
 
 ITEM 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities.
  Dividends
   Recent Sales of Unregistered Securities
  
 ITEM 6. Selected Financial Data
  
 ITEM 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.
  
 ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk
 .
 
 ITEM 8. Financial Statements and Supplemental Data.
  
 ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
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ITEM 9A. Controls and Procedures.
 Disclosure Controls and Procedures
   Managements Annual Report on Internal Control over Financial Reporting
  Changes in Internal Controls
  
 ITEM 9B. Other Information
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PART III
  
 ITEM 10. Directors, Executive Officers and Corporate Governance.
   www.bankofbirmingham.net
   
 ITEM 11. Executive Compensation.
   
 ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters.
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Number of securitiesremaining available forNumber of securities to
    
    Weighted-average
    
    future issuance underbe issued upon exercise
    
    exercise price of
    
    equity compensationof outstanding options,
    
    outstanding options,
    
    plans (excludingwarrants and rights
    
    warrants and rights
    
    securities in column (a))Plan category
    
    (a)
    
    (b)
    
    (c)Equity compensation plans approved by security holders
    
    
    180,000
    
    
    $
    10.00
    
    
    
    45,000Equity compensation plans not approved by security holders (1)
    
    
    184,000
    
    
    $
    10.00
    
    
    
    0Total
    
    
    364,000
    
    
    $
    10.00
    
    
    
    45,000
 
 (1)
    
    Organizers of the Company were granted warrants pursuant to the Companys
registration statement dated November 14, 2005. 
 ITEM 13. Certain Relationships and Related Transactions, and Director Independence.
  
 ITEM 14. Principal Accounting Fees and Services.
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ITEM 15. Exhibits and Financial Statement Schedules
 Number
    
    Description3.1(i)
    
    Articles of Incorporation are incorporated by reference from Exhibit 3.1 of the
Corporations quarterly report on Form 10-Q for the quarter ended June 30, 2009.3.1(ii)
    
    Certificate of Designations for the Series C Preferred Stock (incorporated by
reference from Form 8-K filed on December 21, 2009).3.2
    
    Bylaws (incorporated by reference from Exhibit 3.2 of the Corporations
Registration Statement on Form SB-2 dated September 6, 2005).4.1
    
    Specimen common stock certificate (incorporated by reference from Exhibit 4.1 of
the Corporations Registration Statement on Form SB-2 dated September 6, 2005).4.2
    
    Form of Birmingham Bloomfield Bancshares, Inc. Organizers Warrant Agreement
(incorporated by reference from Exhibit 4.2 of the Corporations Registration
Statement on Form SB-2 dated September 6, 2005).10.1
    
    Birmingham Bloomfield Bancshares, Inc. 2006 Stock Incentive Plan (incorporated
by reference from Exhibit 10.1 of the Corporations Quarterly Report on Form
10-QSB for the Quarter Ended March 31, 2007).10.2
    
    Lease Agreement dated January 28, 2005, by and between Irving I. Rosen Family
Limited Partnership and Birmingham Bloomfield Bancshares, Inc. (incorporated by
reference from Exhibit 10.10 of the Corporations Registration Statement on Form
SB-2 dated September 6, 2005).10.3
    
    Form of Incentive Stock Option Agreement (incorporated by reference from
Quarterly Report on Form 10-QSB for the quarter ended March 31, 2007).10.4
    
    Letter Agreement dated April 24, 2009 including the Securities Purchase
Agreement  Standard Terms incorporated by reference therein between the
Company and the U.S. Treasury (incorporated by reference from Form 8-K filed on
April 30, 2009).10.5
    
    Form of Waiver of Senior Executive Officers (incorporated by reference from Form
8-K filed on April 30, 2009).10.6
    
    Form of Omnibus Amendment Agreement (incorporated by reference from Form 8-K
filed on April 30, 2009).10.7
    
    Side Letter Agreement dated April 24, 2009 between the Company and the U.S.
Treasury (incorporated by reference from Form 8-K filed on April 30, 2009).10.8
    
    Executive Employment Agreement with Robert E. Farr (incorporated by reference
from Form 8-K filed on May 21, 2009).10.9
    
    Executive Employment Agreement with Lance N. Krajacic, Jr. (incorporated by
reference from Form 8-K filed on May 21, 2009).10.10
    
    Letter Agreement dated December 18, 2009 including the Securities Purchase
Agreement  Standard Terms incorporated by reference therein between the
Company and the U.S. Treasury (incorporated by reference from Form 8-K filed on
December 24, 2009).10.11
    
    Form of Waiver of Senior Executive Officers (incorporated by reference from Form
8-K filed on December 24, 2009).10.12
    
    Side Letter Agreement No. 1 dated December 18, 2009 between the Company and the
U.S. Treasury (incorporated by reference from Form 8-K filed on December 24,
2009).10.13
    
    Side Letter Agreement No. 2 dated December 18, 2009 between the Company and the
U.S. Treasury (incorporated by reference from Form 8-K filed on December 24,
2009).10.14
    
    Executive Employment Agreement with Thomas H. Dorr (incorporated by reference
from Form 8-K filed on November 17, 2010).11
    
    Computation of Per Share Earnings is incorporated by reference from the
Corporations 2010 Shareholder Report on Form 10-K13
    
    2010 Shareholder Report (except for portions of the 2010 Shareholder Report that
are expressly incorporated by reference into this Annual Report of Form 10-K,
the 2010 Shareholder Report shall not be deemed filed as apart hereof.)14
    
    Code of Ethics (incorporated by reference from Form 10-K filed on March 31, 2010)21
    
    List of Subsidiaries.23
    
    Consent of Plante & Moran, PLLC.31.1
    
    Certification of Chief Executive Officer Pursuant to Rule 15d-15(e) of the
securities Exchange Act.
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Number
    
    Description31.2
    
    Certification of Chief Financial Officer Pursuant to Rule 15d-15(e) of the
securities Exchange Act.32
    
    Certification Pursuant to Rule 14d-14(b) of the Securities Exchange Act and 18
U.S.C. section 135099.1
    
    31 C.F.R. Section 30.15 Certification of Principal Executive Officer99.2
    
    31 C.F.R. Section 30.15 Certification of Principal Financial Officer
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BIRMINGHAM BLOOMFIELD BANCSHARES, INC.Date: March 21, 2011
    By:
    /s/ Robert E. FarrRobert E. FarrPresident and Chief Executive Officer  SIGNATURE
    
    TITLE
    
    DATE/s/ Harry Cendrowski
    
    Director
    
    March 21, 2011Harry Cendrowski/s/ Donald E. Copus
    
    Director
    
    March 21, 2011Donald E. Copus/s/ John M. Erb
    
    Director
    
    March 21, 2011John M. Erb/s/ Robert E. Farr
    
    Director, President & Chief
    
    March 21, 2011Robert E. Farr
    
    Executive
Officer(Principal Executive Officer)/s/ Charles Kaye
    
    Director
    
    March 21, 2011Charles Kaye/s/ Lance N. Krajacic, Jr.
    
    Director
    
    March 21, 2011Lance N. Krajacic, Jr./s/ Scott McCallum
    
    Director
    
    March 21, 2011Scott McCallum/s/ Daniel P. ODonnell
    
    Director
    
    March 21, 2011Daniel P. ODonnell/s/ Charles T. Pryde
    
    Director
    
    March 21, 2011Charles T. Pryde/s/ Walter G. Schwartz
    
    Director
    
    March 21, 2011Walter F. Schwartz/s/ Henry Spellman
    
    Director
    
    March 21, 2011Henry Spellman/s/ Bruce Nyberg
    
    Director
    
    March 21, 2011Bruce Nyberg
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SIGNATURE
    
    TITLE
    
    DATE/s/ Thomas J. Wagner
    
    Director
    
    March 21, 2011Thomas J. Wagner/s/ Thomas H. Dorr
    
    Chief Financial Officer
(Principal Financial and
    
    March 21, 2011Thomas H. Dorr
    
    Accounting
Officer)
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Exhibit Index
 Number
    
    Description13
    
    2010 Shareholder Report (except for portions of the 2010
Shareholder Report that are expressly incorporated by reference
into this Annual Report of Form 10-K, the 2010 Shareholder Report
shall not be deemed filed as a part hereof.)21
    
    List of Subsidiaries23
    
    Consent of Plante & Moran, PLLC31.1
    
    Certification of Chief Executive Officer Pursuant to Rule 15d-15(e)
of the securities Exchange Act.31.2
    
    Certification of Chief Financial Officer Pursuant to Rule 15d-15(e)
of the securities Exchange Act.32
    
    Certification Pursuant to Rule 14d-14(b) of the Securities Exchange
Act and 18 U.S.C. section 135099.1
    
    31 C.F.R. Section 30.15 Certification of Principal Executive Officer99.2
    
    31 C.F.R. Section 30.15 Certification of Principal Financial Officer
 27