UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDED March 31, 2010
 o
    
    TRANSITION REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES
EXCHANGE ACT OF 1934
 FOR THE TRANSITION PERIOD FROM  TO
 COMMISSION FILE NUMBER: 000-49883
 PLUMAS BANCORP
  California
    
    75-2987096(State or Other Jurisdiction of Incorporation or
    
    (I.R.S. Employer Identification No.)Organization)35 S. Lindan Avenue, Quincy, California
    
    95971(Address of Principal Executive Offices)
    
    (Zip Code)
 (530) 283-7305
 þ o
 Yes
o No
o
  Large Accelerated Filer o   
    Accelerated Filer o
    Non-Accelerated Filer o
    Smaller Reporting Company þ
 o þ




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##### 



PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
 PLUMAS BANCORP
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
 March 31,
    
    
    December 31,2010
    
    
    2009AssetsCash and cash equivalents
    
    $
    68,911
    
    
    $
    59,493Investment securities
    
    
    65,513
    
    
    
    87,950Loans, less allowance for loan losses of $8,266 at March 31, 2010
and $9,568 at December 31, 2009
    
    
    318,361
    
    
    
    323,408Premises and equipment, net
    
    
    15,257
    
    
    
    14,544Intangible assets, net
    
    
    605
    
    
    
    648Bank owned life insurance
    
    
    10,197
    
    
    
    10,111Real estate and vehicles acquired through foreclosure
    
    
    10,976
    
    
    
    11,269Accrued interest receivable and other assets
    
    
    19,824
    
    
    
    20,694Total assets
    
    $
    509,644
    
    
    $
    528,117Liabilities and Shareholders EquityDeposits:Non-interest bearing
    
    $
    106,099
    
    
    $
    111,958Interest bearing
    
    
    325,892
    
    
    
    321,297Total deposits
    
    
    431,991
    
    
    
    433,255Short-term borrowings
    
    
    
    
    
    
    20,000Long-term debt
    
    
    20,000
    
    
    
    20,000Accrued interest payable and other liabilities
    
    
    9,389
    
    
    
    6,321Junior subordinated deferrable interest debentures
    
    
    10,310
    
    
    
    10,310Total liabilities
    
    
    471,690
    
    
    
    489,886Commitments and contingencies (Note 5)
    
    
    
    
    
    
    Shareholders equity:Serial preferred stock, no par value; 10,000,000 shares
authorized; 11,949 issued and outstanding at March 31, 2010 and
December 31, 2009
    
    
    11,617
    
    
    
    11,595Common stock, no par value; 22,500,000 shares authorized; issued
and outstanding   4,776,339 shares at March 31, 2010 and
December 31, 2009
    
    
    5,898
    
    
    
    5,970Retained earnings
    
    
    20,007
    
    
    
    20,044Accumulated other comprehensive income
    
    
    432
    
    
    
    622Total shareholders equity
    
    
    37,954
    
    
    
    38,231Total liabilities and shareholders equity
    
    $
    509,644
    
    
    $
    528,117
   2




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##### 



PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
 For the Three MonthsEnded March 31,2010
    
    
    2009Interest Income:Interest and fees on loans
    
    $
    4,769
    
    
    $
    5,102Interest on investment securities:Taxable
    
    
    507
    
    
    
    334Exempt from Federal income taxes
    
    
    107
    
    
    
    119Other
    
    
    5
    
    
    
    Total interest income
    
    
    5,388
    
    
    
    5,555Interest Expense:Interest on deposits
    
    
    788
    
    
    
    764Interest on borrowings
    
    
    69
    
    
    
    17Interest on junior subordinated deferrable interest debentures
    
    
    74
    
    
    
    110Other
    
    
    1
    
    
    
    3Total interest expense
    
    
    932
    
    
    
    894Net interest income before provision for loan losses
    
    
    4,456
    
    
    
    4,661Provision for Loan Losses
    
    
    1,500
    
    
    
    2,900Net interest income after provision for loan losses
    
    
    2,956
    
    
    
    1,761Non-Interest Income:Service charges
    
    
    898
    
    
    
    906Gain on sale of investments
    
    
    570
    
    
    
    Earnings on Bank owned life insurance policies
    
    
    109
    
    
    
    107Other
    
    
    210
    
    
    
    217Total non-interest income
    
    
    1,787
    
    
    
    1,230Non-Interest Expenses:Salaries and employee benefits
    
    
    2,549
    
    
    
    2,881Occupancy and equipment
    
    
    713
    
    
    
    997Provision for losses on other real estate
    
    
    
    
    
    
    141Other
    
    
    1,448
    
    
    
    1,286Total non-interest expenses
    
    
    4,710
    
    
    
    5,305Income (loss) before provision for income taxes
    
    
    33
    
    
    
    (2,314
    )Benefit for Income Taxes
    
    
    (101
    )
    
    
    (1,037
    )Net income (loss)
    
    $
    134
    
    
    $
    (1,277
    )Preferred Stock Dividends and Discount Accretion
    
    
    (171
    )
    
    
    (116
    )Net (loss) available to common shareholders
    
    $
    (37
    )
    
    $
    (1,393
    )Basic (loss) per share
    
    $
    (0.01
    )
    
    $
    (0.29
    )Diluted (loss) per share
    
    $
    (0.01
    )
    
    $
    (0.29
    )
   3




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##### 



PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 For the Three MonthsEnded March 31,2010
    
    
    2009Cash Flows from Operating Activities:Net income (loss)
    
    $
    134
    
    
    $
    (1,277
    )Adjustments to reconcile net income to net cash provided by operating
activities:Provision for loan losses
    
    
    1,500
    
    
    
    2,900Change in deferred loan origination costs/fees, net
    
    
    (45
    )
    
    
    41Depreciation and amortization
    
    
    442
    
    
    
    506Stock-based compensation expense
    
    
    (72
    )
    
    
    66Amortization of investment security premiums
    
    
    159
    
    
    
    20Accretion of investment security discounts
    
    
    (58
    )
    
    
    (11
    )Net loss on sale of other real estate
    
    
    19
    
    
    
    34Gain on sale of investments
    
    
    (570
    )
    
    
    Gain on sale of loans held for sale
    
    
    
    
    
    
    (10
    )Loans originated for sale
    
    
    (3,271
    )
    
    
    (765
    )Proceeds from secured borrowing
    
    
    3,446
    
    
    
    Proceeds from loan sales
    
    
    
    
    
    
    438Provision for losses on other real estate
    
    
    
    
    
    
    141Net (gain) loss on sale of other vehicles owned
    
    
    (3
    )
    
    
    30Earnings on bank-owned life insurance policies
    
    
    (86
    )
    
    
    (85
    )Decrease (increase) in accrued interest receivable and other assets
    
    
    945
    
    
    
    (1,174
    )(Decrease) in accrued interest payable and other liabilities
    
    
    (423
    )
    
    
    (639
    )Net cash provided by operating activities
    
    
    2,117
    
    
    
    215Cash Flows from Investing Activities:Proceeds from matured and called available-for-sale investment securities
    
    
    7,245
    
    
    
    4,000Proceeds from principal repayments from available-for-sale
government-guaranteed mortgage-backed securities
    
    
    1,897
    
    
    
    1,056Purchases of available-for-sale securities
    
    
    (1,100
    )
    
    
    (27,212
    )Proceeds from sale of available-for-sale securities
    
    
    14,540
    
    
    
    Net decrease in loans
    
    
    5,716
    
    
    
    4,523Proceeds from sale of other real estate
    
    
    1,436
    
    
    
    680Proceeds from sale of other vehicles
    
    
    34
    
    
    
    119Purchase of premises and equipment
    
    
    (1,053
    )
    
    
    (12
    )Net cash provided by (used in) investing activities
    
    
    28,715
    
    
    
    (16,846
    )
   4




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##### 



PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 For the Three MonthsEnded March 31,2010
    
    
    2009Cash Flows from Financing Activities:Net (decrease) increase in demand, interest bearing and savings deposits
    
    $
    (8,042
    )
    
    $
    12,510Net increase in time deposits
    
    
    6,778
    
    
    
    1,708Net decrease in short-term borrowings
    
    
    (20,000
    )
    
    
    (3,000
    )Net proceeds from exercise of stock options
    
    
    
    
    
    
    5Issuance of preferred stock, net of discount
    
    
    
    
    
    
    11,517Issuance of common stock warrant
    
    
    
    
    
    
    407Payment of cash dividends on preferred stock
    
    
    (150
    )
    
    
    Net cash (used in) provided by financing activities
    
    
    (21,414
    )
    
    
    23,147Increase in cash and cash equivalents
    
    
    9,418
    
    
    
    6,516Cash and Cash Equivalents at Beginning of Year
    
    
    59,493
    
    
    
    18,791Cash and Cash Equivalents at End of Period
    
    $
    68,911
    
    
    $
    25,307Supplemental Disclosure of Cash Flow Information:Cash paid during the period for:Interest expense
    
    $
    897
    
    
    $
    932Income taxes
    
    $
    
    
    
    $
    Non-Cash Investing Activities:Real estate and vehicles acquired through foreclosure
    
    $
    1,148
    
    
    $
    177Net change in unrealized gain/loss on available-for-sale securities
    
    $
    (190
    )
    
    $
    109
   5




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##### 



PLUMAS BANCORP
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 1. GENERAL
    2. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
     6




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##### 



3. INVESTMENT SECURITIES
  March 31, 2010Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueDebt securities:U.S. Treasury securities
    
    $
    1,051,000
    
    
    
    
    
    
    $
    (15,000
    )
    
    $
    1,036,000U.S. Government agencies
    
    
    45,561,000
    
    
    $
    239,000
    
    
    
    (17,000
    )
    
    
    45,783,000U.S. Government agencies
collateralized by mortgage
obligations
    
    
    16,997,000
    
    
    
    480,000
    
    
    
    
    
    
    
    17,477,000Obligations of states and
political subdivisions
    
    
    1,169,000
    
    
    
    48,000
    
    
    
    
    
    
    
    1,217,000$
    64,778,000
    
    
    $
    767,000
    
    
    $
    (32,000
    )
    
    $
    65,513,000
  December 31, 2009Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueDebt securities:U.S. Treasury securities
    
    $
    1,059,000
    
    
    
    
    
    
    $
    (7,000
    )
    
    $
    1,052,000U.S. Government agencies
    
    
    55,520,000
    
    
    $
    420,000
    
    
    
    (51,000
    )
    
    
    55,889,000U.S. Government agencies
collateralized by mortgage
obligations
    
    
    18,925,000
    
    
    
    362,000
    
    
    
    
    
    
    
    19,287,000Obligations of states and
political subdivisions
    
    
    11,387,000
    
    
    
    360,000
    
    
    
    (25,000
    )
    
    
    11,722,000$
    86,891,000
    
    
    $
    1,142,000
    
    
    $
    (83,000
    )
    
    $
    87,950,000
   7




---



##### 



Less than 12 MonthsFair
    
    
    UnrealizedValue
    
    
    LossesDebt securities:U.S. Treasury securities
    
    $
    1,036,000
    
    
    $
    15,000U.S. Government agencies
    
    
    2,132,000
    
    
    
    17,000$
    3,168,000
    
    
    $
    32,000
  Less than 12 MonthsFair
    
    
    UnrealizedValue
    
    
    LossesDebt securities:U.S. Treasury securities
    
    $
    1,052,000
    
    
    $
    7,000U.S. Government agencies
    
    
    10,787,000
    
    
    
    51,000Obligations of states and political subdivisions
    
    
    1,208,000
    
    
    
    25,000$
    13,047,000
    
    
    $
    83,000
   EstimatedAmortized
    
    
    FairCost
    
    
    ValueAfter one year through five years
    
    $
    46,612,000
    
    
    $
    46,819,000After five years through ten years
    
    
    1,169,000
    
    
    
    1,217,00047,781,000
    
    
    
    48,036,000Investment securities not due at a
single maturity date:Government-guaranteed mortgage-
backed securities
    
    
    16,997,000
    
    
    
    17,477,000$
    64,778,000
    
    
    $
    65,513,000
   8




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##### 



4. LOANS
  March 31,
    
    
    December 31,2010
    
    
    2009Commercial
    
    $
    40,653
    
    
    $
    37,056Agricultural
    
    
    40,485
    
    
    
    41,722Real estate  mortgage
    
    
    156,140
    
    
    
    161,397Real estate  construction and land development
    
    
    37,080
    
    
    
    38,061Consumer
    
    
    51,925
    
    
    
    54,442326,283
    
    
    
    332,678Deferred loan costs, net
    
    
    344
    
    
    
    298Allowance for loan losses
    
    
    (8,266
    )
    
    
    (9,568
    )$
    318,361
    
    
    $
    323,408
    March 31,
    
    
    December 31,2010
    
    
    2009Balance, beginning of year
    
    $
    9,568
    
    
    $
    7,224Provision charged to operations
    
    
    1,500
    
    
    
    14,500Losses charged to allowance
    
    
    (2,850
    )
    
    
    (12,500
    )Recoveries
    
    
    48
    
    
    
    344Balance, end of period
    
    $
    8,266
    
    
    $
    9,568
  March 31,
    
    
    December 31,2010
    
    
    2009Balance of impaired loans carried at cost
    
    $
    4,104
    
    
    $
    5,512Balance of impaired loans carried at fair value
    
    
    11,990
    
    
    
    9,435Total recorded investment in impaired loans
(net of allocated allowance of $3,003 at March
31, 2010 and $4,281 at December 31, 2009)
    
    $
    16,094
    
    
    $
    14,947
   9




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##### 



5. COMMITMENTS AND CONTINGENCIES
     6. EARNINGS PER SHARE
  For the Three MonthsEnded March 31,(In thousands, except per share data)
    
    2010
    
    
    2009Net Income (loss):Net income (loss)
    
    $
    134
    
    
    $
    (1,277
    )Dividends accrued and discount accreted on preferred shares
    
    
    (171
    )
    
    
    (116
    )Net (loss) available to common shareholders
    
    $
    (37
    )
    
    $
    (1,393
    )Earnings (Loss) Per Share:Loss per share
    
    $
    (0.01
    )
    
    $
    (0.29
    )Weighted Average Number of Shares Outstanding:
    
    
    4,776
    
    
    
    4,776
   10




---



##### 



7. COMPREHENSIVE LOSS
   8. STOCK-BASED COMPENSATION
    WeightedAverageWeighted
    
    
    RemainingAverage
    
    
    ContractualExercise
    
    
    Term
    
    
    Intrinsic ValueShares
    
    
    Price
    
    
    (in years)
    
    
    (in thousands)Options outstanding at December 31, 2009
    
    
    403,966
    
    
    $
    13.56Options granted
    
    
    
    
    
    
    Options exercised
    
    
    
    
    
    
    Options cancelled
    
    
    (14,126
    )
    
    $
    14.26Options outstanding at March 31, 2010
    
    
    389,840
    
    
    $
    13.53
    
    
    
    4.5
    
    
    $
    Options exercisable at March 31, 2010
    
    
    325,597
    
    
    $
    13.40
    
    
    
    4.2
    
    
    $
    Expected to vest after March 31, 2010
    
    
    55,783
    
    
    $
    14.20
    
    
    
    5.5
    
    
    $
    
   11




---



##### 



9. INCOME TAXES
      12




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##### 



10. FAIR VALUE MEASUREMENT
 Fair Value of Financial Instruments
  March 31, 2010
    
    
    December 31, 2009Carrying
    
    
    Fair
    
    
    Carrying
    
    
    FairAmount
    
    
    Value
    
    
    Amount
    
    
    ValueFinancial assets:Cash and cash equivalents
    
    $
    68,911,000
    
    
    $
    68,911,000
    
    
    $
    59,493,000
    
    
    $
    59,493,000Investment securities
    
    
    65,513,000
    
    
    
    65,513,000
    
    
    
    87,950,000
    
    
    
    87,950,000Loans
    
    
    318,361,000
    
    
    
    317,028,000
    
    
    
    323,408,000
    
    
    
    325,589,000Bank owned life insurance
    
    
    10,197,000
    
    
    
    10,197,000
    
    
    
    10,111,000
    
    
    
    10,111,000Accrued interest receivable
    
    
    2,003,000
    
    
    
    2,003,000
    
    
    
    2,487,000
    
    
    
    2,487,000Financial liabilities:Deposits
    
    $
    431,991,000
    
    
    $
    432,117,000
    
    
    $
    433,255,000
    
    
    $
    433,311,000Short-term borrowings
    
    
    
    
    
    
    
    
    
    
    20,000,000
    
    
    
    20,000,000Long-term debt
    
    
    20,000,000
    
    
    
    20,065,000
    
    
    
    20,000,000
    
    
    
    19,817,000Junior subordinated deferrable
interest debentures
    
    
    10,310,000
    
    
    
    2,928,000
    
    
    
    10,310,000
    
    
    
    2,909,000Accrued interest payable
    
    
    512,000
    
    
    
    512,000
    
    
    
    476,000
    
    
    
    476,000
   Cash and cash equivalents:
 Investment securities:
 Loans:
  Bank owned life insurance:
  13




---



##### 



Deposits:
 Short-term borrowings:
 Long-term borrowings:
 Junior subordinated deferrable interest debentures:
 Commitments to extend credit and letters of credit:
        14




---



##### 



Fair Value Measurements at March 31, 2010 UsingQuoted Prices inActive Markets for
    
    
    Significant Other
    
    
    SignificantTotal Fair
    
    
    Identical Assets
    
    
    Observable Inputs
    
    
    UnobservableValue
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    Inputs (Level 3)Assets:Available-for-sale
securities
    
    $
    65,513,000
    
    
    $
    48,036,000
    
    
    $
    17,477,000
  Fair Value Measurements at December 31, 2009 UsingQuoted Prices inActive Markets for
    
    
    Significant Other
    
    
    SignificantTotal Fair
    
    
    Identical Assets
    
    
    Observable Inputs
    
    
    UnobservableValue
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    Inputs (Level 3)Assets:Available-for-sale
securities
    
    $
    87,950,000
    
    
    $
    68,663,000
    
    
    $
    19,287,000
   Fair Value Measurements at March 31, 2010 UsingQuoted Prices inActive Markets for
    
    
    Significant Other
    
    
    SignificantTotal Fair
    
    
    Identical Assets
    
    
    Observable Inputs
    
    
    UnobservableValue
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    Inputs (Level 3)Assets:Impaired
loans
    
    $
    11,990,000
    
    
    
    
    
    
    $
    11,990,000Other real estate
    
    
    10,921,000
    
    
    
    
    
    
    
    10,921,000$
    22,911,000
    
    
    
    
    
    
    $
    22,911,000
  15




---



##### 



Fair Value Measurements at December 31, 2009 UsingQuoted Prices inActive Markets for
    
    
    Significant Other
    
    
    SignificantTotal Fair
    
    
    
    Identical Assets
    
    
    Observable Inputs
    
    
    UnobservableValue
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    Inputs (Level 3)Assets:Impaired
loans
    
    $
    9,435,000
    
    
    
    
    
    
    $
    9,435,000Other real estate
    
    
    11,204,000
    
    
    
    
    
    
    
    11,204,000$
    20,639,000
    
    
    
    
    
    
    $
    20,639,000
    11. Adoption of New Financial Accounting Standards
 Accounting for Transfers of Financial Assets
   16




---



##### 



Transfers and Servicing
  Fair Value Measurements and Disclosures
   17




---



##### 



PART I  FINANCIAL INFORMATION
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
   INTRODUCTION
   CRITICAL ACCOUNTING POLICIES AND ESTIMATES
   OVERVIEW
   18




---



##### 



RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2010
 Net interest income before provision for loan losses.
  19




---



##### 



20




---



##### 



For the Three Months Ended March 31, 2010
    
    
    For the Three Months Ended March 31, 2009Average Balance
    
    
    Interest
    
    
    Yield/
    
    
    Average Balance
    
    
    Interest
    
    
    Yield/(in thousands)
    
    
    (in thousands)
    
    
    Rate
    
    
    (in thousands)
    
    
    (in thousands)
    
    
    RateInterest-earning assets:Loans (1) (2)
    
    $
    327,796
    
    
    $
    4,769
    
    
    
    5.90
    %
    
    $
    362,439
    
    
    $
    5,102
    
    
    
    5.71
    %Investment securities (1)
    
    
    84,142
    
    
    
    614
    
    
    
    2.96
    %
    
    
    45,838
    
    
    
    453
    
    
    
    4.01
    %Other
    
    
    8,300
    
    
    
    5
    
    
    
    0.24
    %
    
    
    43
    
    
    
    
    
    
    
    2.28
    %Total interest-earning assets
    
    
    420,238
    
    
    
    5,388
    
    
    
    5.20
    %
    
    
    408,320
    
    
    
    5,555
    
    
    
    5.52
    %Cash and due from banks
    
    
    41,211
    
    
    
    
    
    
    
    
    
    
    
    17,565Other assets
    
    
    49,559
    
    
    
    
    
    
    
    
    
    
    
    33,755Total assets
    
    $
    511,008
    
    
    
    
    
    
    
    
    
    
    $
    459,640Interest-bearing liabilities:NOW deposits
    
    $
    103,724
    
    
    
    156
    
    
    
    0.61
    %
    
    $
    78,357
    
    
    
    109
    
    
    
    0.56
    %Money market deposits
    
    
    44,534
    
    
    
    75
    
    
    
    0.68
    %
    
    
    40,871
    
    
    
    85
    
    
    
    0.84
    %Savings deposits
    
    
    49,687
    
    
    
    20
    
    
    
    0.16
    %
    
    
    49,726
    
    
    
    23
    
    
    
    0.19
    %Time deposits
    
    
    127,296
    
    
    
    537
    
    
    
    1.71
    %
    
    
    98,489
    
    
    
    547
    
    
    
    2.25
    %Total deposits
    
    
    325,241
    
    
    
    788
    
    
    
    0.98
    %
    
    
    267,443
    
    
    
    764
    
    
    
    1.16
    %Short-term borrowings
    
    
    4,000
    
    
    
    5
    
    
    
    0.51
    %
    
    
    26,462
    
    
    
    17
    
    
    
    0.26
    %Long-term borrowings
    
    
    20,000
    
    
    
    64
    
    
    
    1.30
    %
    
    
    
    
    
    
    
    
    
    
    
    %Other interest-bearing liabilities
    
    
    138
    
    
    
    1
    
    
    
    2.94
    %
    
    
    222
    
    
    
    3
    
    
    
    5.48
    %Junior subordinated debentures
    
    
    10,310
    
    
    
    74
    
    
    
    2.91
    %
    
    
    10,310
    
    
    
    110
    
    
    
    4.33
    %Total interest-bearing liabilities
    
    
    359,689
    
    
    
    932
    
    
    
    1.05
    %
    
    
    304,437
    
    
    
    894
    
    
    
    1.19
    %Non-interest bearing deposits
    
    
    106,087
    
    
    
    
    
    
    
    
    
    
    
    105,906Other liabilities
    
    
    6,365
    
    
    
    
    
    
    
    
    
    
    
    5,378Shareholders equity
    
    
    38,867
    
    
    
    
    
    
    
    
    
    
    
    43,919Total liabilities & equity
    
    $
    511,008
    
    
    
    
    
    
    
    
    
    
    $
    459,640Cost of funding interest-earning assets (3)
    
    
    
    
    
    
    
    
    
    
    0.90
    %
    
    
    
    
    
    
    
    
    
    
    0.89
    %Net interest income and margin (4)
    
    
    
    
    
    $
    4,456
    
    
    
    4.30
    %
    
    
    
    
    
    $
    4,661
    
    
    
    4.63
    %
 
 (1)
    
    Not computed on a tax-equivalent basis.(2)
    
    Net loan fee (costs) included in loan interest income for the three-month periods ended March
31, 2010 and 2009 were $11,000 and $(65,000), respectively.(3)
    
    Total annualized interest expense divided by the average balance of total earning assets.(4)
    
    Annualized net interest income divided by the average balance of total earning assets.  21




---



##### 



2010 over 2009 change in net interest incomefor the three months ended March 31(in thousands)Volume (1)
    
    
    Rate (2)
    
    
    Mix (3)
    
    
    TotalInterest-earning assets:Loans
    
    $
    (488
    )
    
    $
    171
    
    
    $
    (16
    )
    
    $
    (333
    )Investment securities
    
    
    379
    
    
    
    (119
    )
    
    
    (99
    )
    
    
    161Other
    
    
    46
    
    
    
    
    
    
    
    (41
    )
    
    
    5Total interest income
    
    
    (63
    )
    
    
    52
    
    
    
    (156
    )
    
    
    (167
    )Interest-bearing liabilities:NOW deposits
    
    
    35
    
    
    
    9
    
    
    
    3
    
    
    
    47Money market deposits
    
    
    7
    
    
    
    (16
    )
    
    
    (1
    )
    
    
    (10
    )Savings deposits
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    (3
    )Time deposits
    
    
    160
    
    
    
    (132
    )
    
    
    (38
    )
    
    
    (10
    )Short-term borrowings
    
    
    (14
    )
    
    
    16
    
    
    
    (14
    )
    
    
    (12
    )Long-term borrowings
    
    
    
    
    
    
    
    
    
    
    64
    
    
    
    64Other
    
    
    (1
    )
    
    
    (1
    )
    
    
    
    
    
    
    (2
    )Junior subordinated debentures
    
    
    
    
    
    
    (36
    )
    
    
    
    
    
    
    (36
    )Total interest expense
    
    
    187
    
    
    
    (163
    )
    
    
    14
    
    
    
    38Net interest income
    
    $
    (250
    )
    
    $
    215
    
    
    $
    (170
    )
    
    $
    (205
    )
 
 (1)
    
    The volume change in net interest income represents the change in average balance multiplied by
the previous years rate.(2)
    
    The rate change in net interest income represents the change in rate multiplied by the previous
years average balance.(3)
    
    The mix change in net interest income represents the change in average balance multiplied by
the change in rate. Provision for loan losses.
    22




---



##### 



Non-interest income.
   For the ThreeMonthsEnded March 31
    
    
    Dollar
    
    
    Percentage2010
    
    
    2009
    
    
    Change
    
    
    ChangeService charges on deposit accounts
    
    $
    898
    
    
    $
    906
    
    
    $
    (8
    )
    
    
    -0.9
    %Gain on sale of securities
    
    
    570
    
    
    
    
    
    
    
    570
    
    
    
    100
    %Earnings on life insurance policies
    
    
    109
    
    
    
    107
    
    
    
    2
    
    
    
    1.9
    %Merchant processing income
    
    
    53
    
    
    
    51
    
    
    
    2
    
    
    
    3.9
    %Customer service fees
    
    
    39
    
    
    
    28
    
    
    
    11
    
    
    
    39.3
    %Safe deposit box and night depository income
    
    
    17
    
    
    
    17
    
    
    
    
    
    
    
    0.0
    %Investment services income
    
    
    13
    
    
    
    30
    
    
    
    (17
    )
    
    
    -56.7
    %Gain on sale of loans
    
    
    
    
    
    
    10
    
    
    
    (10
    )
    
    
    -100.0
    %Other
    
    
    88
    
    
    
    81
    
    
    
    7
    
    
    
    8.6
    %Total non-interest income
    
    $
    1,787
    
    
    $
    1,230
    
    
    $
    557
    
    
    
    45.3
    %
 Non-interest expenses.
   23




---



##### 



For the ThreeMonthsEnded March 31
    
    
    Dollar
    
    
    Percentage2010
    
    
    2009
    
    
    Change
    
    
    ChangeSalaries and employee benefits
    
    $
    2,549
    
    
    $
    2,881
    
    
    $
    (332
    )
    
    
    -11.5
    %Occupancy and equipment
    
    
    713
    
    
    
    997
    
    
    
    (284
    )
    
    
    -28.5
    %Outside service fees
    
    
    304
    
    
    
    199
    
    
    
    105
    
    
    
    52.8
    %FDIC Insurance and assessments
    
    
    253
    
    
    
    146
    
    
    
    107
    
    
    
    73.3
    %Professional fees
    
    
    179
    
    
    
    168
    
    
    
    11
    
    
    
    6.5
    %OREO Expense
    
    
    160
    
    
    
    59
    
    
    
    101
    
    
    
    171.2
    %Telephone and data communication
    
    
    90
    
    
    
    105
    
    
    
    (15
    )
    
    
    -14.3
    %Business development
    
    
    66
    
    
    
    74
    
    
    
    (8
    )
    
    
    -10.8
    %Loan and collection expenses
    
    
    63
    
    
    
    68
    
    
    
    (5
    )
    
    
    -7.4
    %Postage
    
    
    59
    
    
    
    58
    
    
    
    1
    
    
    
    1.7
    %Advertising and shareholder relations
    
    
    58
    
    
    
    78
    
    
    
    (20
    )
    
    
    -25.6
    %Director compensation and retirement
    
    
    56
    
    
    
    75
    
    
    
    (19
    )
    
    
    -25.3
    %Armored car and courier
    
    
    56
    
    
    
    67
    
    
    
    (11
    )
    
    
    -16.4
    %Deposit premium amortization
    
    
    43
    
    
    
    43
    
    
    
    
    
    
    
    0.0
    %Stationery and supplies
    
    
    34
    
    
    
    51
    
    
    
    (17
    )
    
    
    -33.3
    %Loss on sale of OREO and OVO
    
    
    16
    
    
    
    64
    
    
    
    (48
    )
    
    
    -75.0
    %Provision for OREO losses
    
    
    
    
    
    
    141
    
    
    
    (141
    )
    
    
    -100
    %Other
    
    
    11
    
    
    
    31
    
    
    
    (20
    )
    
    
    -64.5
    %Total non-interest expense
    
    $
    4,710
    
    
    $
    5,305
    
    
    $
    (595
    )
    
    
    -11.2
    %
 Benefit for income taxes.
  24




---



##### 



FINANCIAL CONDITION
 Fair value.
 Notes to Condensed Consolidated Financial Statements
 Loan portfolio composition.
   25




---



##### 



Asset Quality.
     Nonperforming loans.
  26




---



##### 



Nonperforming assets.
  Analysis of allowance for loan losses.
    27




---



##### 



For the Three MonthsEnded March 31,2010
    
    
    2009Balance at January 1,
    
    $
    9,568
    
    
    $
    7,224Charge-offs:Commercial and agricultural
    
    
    (377
    )
    
    
    (150
    )Real estate mortgage
    
    
    (781
    )
    
    
    (61
    )Real estate construction
    
    
    (1,567
    )
    
    
    (138
    )Consumer
    
    
    (125
    )
    
    
    (180
    )Total charge-offs
    
    
    (2,850
    )
    
    
    (529
    )Recoveries:Commercial and agricultural
    
    
    5
    
    
    
    Real estate mortgage
    
    
    3
    
    
    
    Real estate construction
    
    
    
    
    
    
    Consumer
    
    
    40
    
    
    
    53Total recoveries
    
    
    48
    
    
    
    53Net charge-offs
    
    
    (2,802
    )
    
    
    (476
    )Provision for loan losses
    
    
    1,500
    
    
    
    2,900Balance at March 31,
    
    $
    8,266
    
    
    $
    9,648Annualized net charge-offs during the three-month
period to average
loans
    
    
    3.47
    %
    
    
    0.53
    %Allowance for loan losses to total loans
    
    
    2.53
    %
    
    
    2.67
    %
 Investment securities.
 Premises and equipment.
  28




---



##### 



Deposits.
  Short-term borrowing arrangements.
    Long-term borrowing arrangements.
 CAPITAL RESOURCES
    29




---



##### 



30




---



##### 



March 31, 2010
    
    
    December 31, 2009Amount
    
    
    Ratio
    
    
    Amount
    
    
    RatioTier 1 Leverage RatioPlumas Bancorp and Subsidiary
    
    $
    40,878
    
    
    
    8.1
    %
    
    $
    40,564
    
    
    
    7.9
    %Minimum regulatory requirement
    
    
    20,118
    
    
    
    4.0
    %
    
    
    20,652
    
    
    
    4.0
    %Plumas Bank
    
    
    40,883
    
    
    
    8.1
    %
    
    
    38,172
    
    
    
    7.4
    %Minimum requirement for
Well-Capitalized institution
under the prompt corrective
action plan
    
    
    25,186
    
    
    
    5.0
    %
    
    
    25,848
    
    
    
    5.0
    %Minimum regulatory requirement
    
    
    20,149
    
    
    
    4.0
    %
    
    
    20,678
    
    
    
    4.0
    %Tier 1 Risk-Based Capital RatioPlumas Bancorp and Subsidiary
    
    
    40,878
    
    
    
    11.1
    %
    
    
    40,564
    
    
    
    10.4
    %Minimum regulatory requirement
    
    
    14,682
    
    
    
    4.0
    %
    
    
    15,641
    
    
    
    4.0
    %Plumas Bank
    
    
    40,883
    
    
    
    11.1
    %
    
    
    38,172
    
    
    
    9.8
    %Minimum requirement for
Well-Capitalized institution
under the prompt corrective
action plan
    
    
    22,067
    
    
    
    6.0
    %
    
    
    23,433
    
    
    
    6.0
    %Minimum regulatory requirement
    
    
    14,712
    
    
    
    4.0
    %
    
    
    15,622
    
    
    
    4.0
    %Total Risk-Based Capital RatioPlumas Bancorp and Subsidiary
    
    
    45,513
    
    
    
    12.4
    %
    
    
    45,512
    
    
    
    11.6
    %Minimum regulatory requirement
    
    
    29,363
    
    
    
    8.0
    %
    
    
    31,281
    
    
    
    8.0
    %Plumas Bank
    
    
    45,528
    
    
    
    12.4
    %
    
    
    43,113
    
    
    
    11.0
    %Minimum requirement for
Well-Capitalized institution
under the prompt corrective
action plan
    
    
    36,779
    
    
    
    10.0
    %
    
    
    39,056
    
    
    
    10.0
    %Minimum regulatory requirement
    
    
    29,423
    
    
    
    8.0
    %
    
    
    31,244
    
    
    
    8.0
    %
 LIQUIDITY
    31




---



##### 



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK
  ITEM 4T. CONTROLS AND PROCEDURES
   PART II  OTHER INFORMATION
 ITEM 1. LEGAL PROCEEDINGS
  ITEM 1A RISK FACTORS
   32




---



##### 



ITEM 2. UNREGISTERD SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
    ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  ITEM 4. (REMOVED AND RESERVED)
  ITEM 5. OTHER INFORMATION
   33




---



##### 



ITEM 6. EXHIBITS
  3.1
    
    
    Articles of Incorporation as amended of Registrant included as exhibit 3.1 to the Registrants
Form S-4, File No. 333-84534, which is incorporated by reference herein.3.2
    
    
    Bylaws of Registrant as amended on January 21, 2009, is included as exhibit 3.2 to the
Registrants 10-K for December 31, 2008, which is incorporated by this reference herein.3.3
    
    
    Amendment of the Articles of Incorporation of Registrant dated November 1, 2002, is included
as exhibit 3.3 to the Registrants 10-Q for September 30, 2005, which is incorporated by this
reference herein.3.4
    
    
    Amendment of the Articles of Incorporation of Registrant dated August 17, 2005, is included as
exhibit 3.4 to the Registrants 10-Q for September 30, 2005, which is incorporated by this
reference herein.4
    
    
    Specimen form of certificate for Plumas Bancorp included as exhibit 4 to the Registrants
Form S-4, File No. 333-84534, which is incorporated by reference herein.4.1
    
    
    Certificate of Determination of Fixed Rate Cumulative Perpetual Preferred Stock, Series A, is
included as exhibit 4.1 to Registrants 8-K filed on January 30, 2009, which is incorporated
by this reference herein.10.1
    
    
    Executive Salary Continuation Agreement of Andrew J. Ryback dated December 17, 2008, is
included as exhibit 10.1 to the Registrants 10-K for
December 31, 2008, which is incorporated
by this reference herein.10.2
    
    
    Split Dollar Agreement of Andrew J. Ryback dated August 23, 2005, is included as Exhibit 10.2
to the Registrants 8-K filed on October 17, 2005, which is incorporated by this reference
herein.10.5
    
    
    Employment Agreement of Douglas N. Biddle dated February 18, 2009, is included as
Exhibit 10.05 to the Registrants 8-K filed on February 19, 2009, which is incorporated by
this reference herein.10.6
    
    
    Executive Salary Continuation Agreement as amended of Douglas N. Biddle dated June 2, 1994, is
included as Exhibit 10.6 to the Registrants 10-QSB for June 30, 2002, which is incorporated
by this reference herein.10.7
    
    
    Split Dollar Agreements of Douglas N. Biddle dated January 24, 2002, is included as
Exhibit 10.7 to the Registrants 10-QSB for June 30, 2002, which is incorporated by this
reference herein.10.8
    
    
    Director Retirement Agreement of John Flournoy dated March 21, 2007, is included as Exhibit
10.8 to Registrants 10-Q for March 31, 2007, which is incorporated by this reference herein.10.11
    
    
    First Amendment to Executive Salary Continuation Agreement of Robert T. Herr dated
September 15, 2004, is included as Exhibit 10.11 to the Registrants 8-K filed on September 17,
2004, which is incorporated by this reference herein.10.18
    
    
    Amended and Restated Director Retirement Agreement of Daniel E. West dated May 10, 2000, is
included as Exhibit 10.18 to the Registrants 10-QSB for June 30, 2002, which is incorporated
by this reference herein.10.19
    
    
    Consulting Agreement of Daniel E. West dated May 10, 2000, is included as Exhibit 10.19 to the
Registrants 10-QSB for June 30, 2002, which is incorporated by this reference herein.
  34




---



##### 



10.20
    
    
    Split Dollar Agreements of Robert T. Herr dated September 15, 2004, is included as
Exhibit 10.20 to the Registrants 8-K filed on September 17, 2004, which is incorporated by
this reference herein.10.21
    
    
    Amended and Restated Director Retirement Agreement of Alvin G. Blickenstaff dated April 19,
2000, is included as Exhibit 10.21 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.22
    
    
    Consulting Agreement of Alvin G. Blickenstaff dated May 8, 2000, is included as Exhibit 10.22
to the Registrants 10-QSB for June 30, 2002, which is incorporated by this reference herein.10.24
    
    
    Amended and Restated Director Retirement Agreement of Gerald W. Fletcher dated May 10, 2000,
is included as Exhibit 10.24 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.25
    
    
    Consulting Agreement of Gerald W. Fletcher dated May 10, 2000, is included as Exhibit 10.25 to
the Registrants 10-QSB for June 30, 2002, which is incorporated by this reference herein.10.27
    
    
    Amended and Restated Director Retirement Agreement of Arthur C. Grohs dated May 9, 2000, is
included as Exhibit 10.27 to the Registrants 10-QSB for June 30, 2002, which is incorporated
by this reference herein.10.28
    
    
    Consulting Agreement of Arthur C. Grohs dated May 9, 2000, is included as Exhibit 10.28 to the
Registrants 10-QSB for June 30, 2002, which is incorporated by this reference herein.10.33
    
    
    Amended and Restated Director Retirement Agreement of Terrance J. Reeson dated April 19, 2000,
is included as Exhibit 10.33 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.34
    
    
    Consulting Agreement of Terrance J. Reeson dated May 10, 2000, is included as Exhibit 10.34 to
the Registrants 10-QSB for June 30, 2002, which is incorporated by this reference herein.10.35
    
    
    Letter Agreement, dated January 30, 2009 by and between Plumas Bancorp, Inc. and the United
States Department of the Treasury and Securities Purchase Agreement  Standard Terms attached
thereto, is included as exhibit 10.1 to Registrants 8-K filed on January 30, 2009, which is
incorporated by this reference herein.10.36
    
    
    Form of Senior Executive Officer letter agreement, is included as exhibit 10.2 to Registrants
8-K filed on January 30, 2009, which is incorporated by this reference herein.10.37
    
    

Deferred
Fee Agreement of Alvin Blickenstaff is included as Exhibit 10.37 to
the Registrants 10-Q for March 31, 2009, which is
incorporated by this reference herein.10.40
    
    
    2001 Stock Option Plan as amended is included as exhibit 99.1 of the Form S-8 filed July 23,
2002, File No. 333-96957, which is incorporated by this reference herein.10.41
    
    

Form of
Indemnification Agreement (Plumas Bancorp). is included as Exhibit
10.41 to
the Registrants 10-Q for March 31, 2009, which is
incorporated by this reference herein.10.42
    
    

Form of
Indemnification Agreement (Plumas Bank). is included as Exhibit 10.42 to
the Registrants 10-Q for March 31, 2009, which is
incorporated by this reference herein.10.43
    
    
    Plumas Bank 401(k) Profit Sharing Plan as amended is included as exhibit 99.1 of the Form S-8
filed February 14, 2003, File No. 333-103229, which is incorporated by this reference herein.10.44
    
    
    Executive Salary Continuation Agreement of Robert T. Herr dated June 4, 2002, is included as
Exhibit 10.44 to the Registrants 10-Q for March 31, 2003, which is incorporated by this
reference herein.
  35




---



##### 



10.46
    
    
    1991 Stock Option Plan as amended is included as Exhibit 10.46 to the Registrants 10-Q for
September 30, 2004, which is incorporated by this reference herein.10.47
    
    
    Specimen form of Incentive Stock Option Agreement under the 1991 Stock Option Plan is included
as Exhibit 10.47 to the Registrants 10-Q for September 30, 2004, which is incorporated by
this reference herein.10.48
    
    
    Specimen form of Non-Qualified Stock Option Agreement under the 1991 Stock Option Plan is
included as Exhibit 10.48 to the Registrants 10-Q for September 30, 2004, which is
incorporated by this reference herein.10.49
    
    
    Amended and Restated Plumas Bancorp Stock Option Plan is included as Exhibit 10.49 to the
Registrants 10-Q for September 30, 2006, which is incorporated by this reference herein.10.50
    
    
    Executive Salary Continuation Agreement of Rose Dembosz, is included as exhibit 10.50 to the
Registrants 10-K for December 31, 2008, which is incorporated by this reference herein.10.51
    
    
    First Amendment to Split Dollar Agreement of Andrew J. Ryback, is included as exhibit 10.51 to
the Registrants 10-K for December 31, 2008, which is incorporated by this reference herein.10.52
    
    
    Executive Salary Continuation Agreement of Douglas N. Biddle dated December 17, 2008, is
included as exhibit 10.52 to the Registrants 10-K for December 31, 2008, which is
incorporated by this reference herein.10.53
    
    
    Second Amendment to Executive Salary Continuation Agreement of Douglas N. Biddle dated June 2,
1994 and Amended February 16, 2000, is included as exhibit 10.53 to the Registrants 10-K for
December 31, 2008, which is incorporated by this reference herein.10.54
    
    
    First Amendment to Addendum A of Split Dollar Agreements of Douglas N. Biddle dated
January 24, 2002, is included as exhibit 10.54 to the Registrants 10-K for December 31, 2008,
which is incorporated by this reference herein.10.55
    
    
    First Amendment to Addendum B of Split Dollar Agreements of Douglas N. Biddle dated
January 24, 2002, is included as exhibit 10.55 to the Registrants 10-K for December 31, 2008,
which is incorporated by this reference herein.10.56
    
    
    Second Amendment to Executive Salary Continuation Agreement of Robert T. Herr dated
June 4, 2002 and Amended September 15, 2004, is included as exhibit 10.56 to the Registrants
10-K for December 31, 2008, which is incorporated by this reference herein.10.57
    
    
    First Amendment to Split Dollar Agreements of Robert T. Herr dated September 15, 2004, is
included as exhibit 10.57 to the Registrants 10-K for December 31, 2008, which is
incorporated by this reference herein.10.58
    
    
    Executive Salary Continuation Agreement of Robert T. Herr dated December 17, 2008, is included
as exhibit 10.58 to the Registrants 10-K for December 31, 2008, which is incorporated by this
reference herein.10.64
    
    
    First Amendment to the Plumas Bank Amended and Restated Director Retirement Agreement for
Alvin Blickenstaff adopted on September 19, 2007, is included as Exhibit 10.64 to the
Registrants 8-K filed on September 25, 2007, which is incorporated by this reference herein.10.65
    
    
    First Amendment to the Plumas Bank Amended and Restated Director Retirement Agreement for
Arthur C. Grohs adopted on September 19, 2007, is included as Exhibit 10.65 to the
Registrants 8-K filed on September 25, 2007, which is incorporated by this reference herein.
  36




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##### 



10.67
    
    
    First Amendment to the Plumas Bank Amended and Restated Director Retirement Agreement for
Terrance J. Reeson adopted on September 19, 2007, is included as Exhibit 10.67 to the
Registrants 8-K filed on September 25, 2007, which is incorporated by this reference herein.10.69
    
    
    First Amendment to the Plumas Bank Amended and Restated Director Retirement Agreement for
Daniel E. West adopted on September 19, 2007, is included as Exhibit 10.69 to the Registrants
8-K filed on September 25, 2007, which is incorporated by this reference herein.10.70
    
    
    First Amendment to the Plumas Bank Amended and Restated Director Retirement Agreement for
Gerald W. Fletcher adopted on October 9, 2007, is included as Exhibit 10.70 to the
Registrants 10-Q for September 30, 2007, which is incorporated by this reference herein.11
    
    
    Computation of per share earnings appears in the attached 10-Q under Plumas Bancorp and
Subsidiary Notes to Condensed Consolidated Financial Statements as Footnote 5  Earnings Per
Share.31.1
    
    
    Rule 13a-14(a) [Section 302] Certification of Principal Financial Officer dated April 28, 2010.31.2
    
    
    Rule 13a-14(a) [Section 302] Certification of Principal Executive Officer dated April 28, 2010.32.1
    
    
    Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, As Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated April 28, 2010.32.2
    
    
    Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, As Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated April 28, 2010.
 SIGNATURES
  PLUMAS BANCORP
  /s/ Richard L. BelstockRichard L. BelstockInterim  Chief Financial Officer/s/ Andrew J. RybackAndrew J. RybackInterim President and Chief Executive Officer  37