| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

|  ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|------------------------------------------------------------------------------------------|

| California                      |   | 80-0123855                              |
|---------------------------------|--------|-----------------------------------------|
| (State or other jurisdiction of |   | (I.R.S. Employer Identification Number) |
| incorporation or organization)  |   |                                    |

| Large accelerated filer  ̈ | Accelerated filer  ̈ |   Non-accelerated filer  ̈ | Smaller reporting company x |
|--------------------------------|--------------------------|------------------------------------------|-----------------------------|
|                           |                     | (Do not check if a smaller               |                        |
|                           |                     | reporting company)                       |                        |

----

| PART I - FINANCIAL INFORMATION |                                                                                  |
|--------------------------------|---------------------------------------------------------------------------------------|
|                           |                                                                                  |   |
| Item 1                         | Financial Statements                                                                  |   |
|                           |                                                                                  |   |
|                           | Interim Consolidated Balance Sheets                                                   | 4 |
|                           |                                                                                  |   |
|                           | Interim Consolidated Statements of Operations                                         | 5 |
|                           |                                                                                  |   |
|                           | Interim Consolidated Statements of Cash Flows                                         | 6 |
|                           |                                                                                  |   |
|                           | Notes to Interim Consolidated Financial Statements                                    | 7 |
|                           |                                                                                  |   |
| Item 2                         | Management's Discussion and Analysis of Financial Condition and Results of Operations | 23 |
|                           |                                                                                  |   |
| Item 3                         | Quantitative and Qualitative Disclosures About Market Risk                            | 41 |
|                           |                                                                                  |   |
| Item 4                         | Controls and Procedures                                                               | 43 |
|                           |                                                                                  |   |
| PART II - OTHER INFORMATION    |                                                                                  |
|                           |                                                                                  |   |
| Item 1                         | Legal Proceedings                                                                     | 44 |
|                           |                                                                                  |   |
| Item 1A                        | Risk Factors                                                                          | 44 |
|                           |                                                                                  |   |
| Item 2                         | Unregistered Sales of Equity Securities and Use of Proceeds                           | 44 |
|                           |                                                                                  |   |
| Item 3                         | Defaults Upon Senior Securities                                                       | 44 |
|                           |                                                                                  |   |
| Item 4                         | Submission of Matters to a Vote of Security Holders                                   | 44 |
|                           |                                                                                  |   |
| Item 5                         | Other Information                                                                     | 44 |
|                           |                                                                                  |   |
| Item 6                         | Exhibits                                                                              | 44 |
|                           |                                                                                  |   |
| Signatures                     | 45                                                                                    |
|                           |                                                                                  |   |
| Index to Exhibits              | 46                                                                                    |

----

----

|                                                           |   | (unaudited) |    |   |         |   |
|----------------------------------------------------------------|--------|-------------|---------|--------|--------------|--------|
|                                                           |   | March 31,   |    |   | December 31, |   |
|                                                           |   | 2011        |    |   | 2010         |   |
| ASSETS                                                         |   |        |    |   |         |   |
| Cash and due from banks                                        |   | $           | 15,001  |   |         | $      | 8,676 |   |
| Federal funds sold                                             |   |        | 108,520 |   |         |   | 114,240 |   |
| Total cash and equivalents                                     |   |        | 123,521 |   |         |   | 122,916 |   |
|                                                           |   |        |    |   |         |   |   |   |
| Interest bearing deposits in other banks                       |   |        | 1,560   |   |         |   | 2,539 |   |
| Investment securities available for sale                       |   |        | 204,177 |   |         |   | 217,303 |   |
| Loans, net of allowance for credit losses of $15,171 at        |   |        |    |   |         |   |   |   |
| March 31, 2011 and $15,546 at December 31, 2010                |   |        | 615,079 |   |         |   | 634,557 |   |
| Premises and equipment, net                                    |   |        | 2,396   |   |         |   | 2,580 |   |
| Other real estate owned                                        |   |        | 9,666   |   |         |   | 6,645 |   |
| Accrued interest receivable                                    |   |        | 3,592   |   |         |   | 3,439 |   |
| Other assets                                                   |   |        | 38,446  |   |         |   | 39,752 |   |
| Total assets                                                   |   | $           | 998,437 |   |         | $      | 1,029,731 |   |
|                                                           |   |        |    |   |         |   |   |   |
| LIABILITIES AND SHAREHOLDERS' EQUITY                           |   |        |    |   |         |   |   |   |
| Deposits:                                                      |   |        |    |   |         |   |   |   |
| Demand noninterest-bearing                                     |   | $           | 475,287 |   |         | $      | 443,806 |   |
| Demand interest-bearing                                        |   |        | 5,096   |   |         |   | 5,275 |   |
| Savings                                                        |   |        | 305,113 |   |         |   | 355,772 |   |
| Time                                                           |   |        | 42,215  |   |         |   | 43,093 |   |
| Total deposits                                                 |   |        | 827,711 |   |         |   | 847,946 |   |
|                                                           |   |        |    |   |         |   |   |   |
| Junior subordinated debt securities                            |   |        | 17,527  |   |         |   | 17,527 |   |
| Other borrowings                                               |   |        | -       |   |         |   | 7,672 |   |
| Accrued interest payable                                       |   |        | 36      |   |         |   | 48 |   |
| Other liabilities                                              |   |        | 30,797  |   |         |   | 14,235 |   |
| Total liabilities                                              |   |        | 876,071 |   |         |   | 887,428 |   |
|                                                           |   |        |    |   |         |   |   |   |
| Commitments and contingencies                                  |   |        | -       |   |         |   | - |   |
|                                                           |   |        |    |   |         |   |   |   |
| SHAREHOLDERS' EQUITY                                           |   |        |    |   |         |   |   |   |
| Preferred stock, no par value; 10,000,000 shares authorized;   |   |        |    |   |         |   |   |   |
| no shares issued and outstanding at March 31, 2011 and         |   |        |    |   |         |   |   |   |
| 23,864 shares issued and outstanding at December 31, 2010      |   |        | -       |   |         |   | 23,864 |   |
| Common stock, no par value; 30,000,000 shares authorized;      |   |        |    |   |         |   |   |   |
| 15,066,670 shares issued and outstanding at March 31, 2011;    |   |        |    |   |         |   |   |   |
| 14,510,379 shares issued and outstanding at December 31, 2010; |   |        | 101,546 |   |         |   | 100,435 |   |
| Additional paid in capital                                     |   |        | 4,566   |   |         |   | 4,408 |   |
| Retained earnings                                              |   |        | 17,154  |   |         |   | 15,784 |   |
| Accumulated other comprehensive (loss) income                  |   |        | (900    | )      |         |   | (2,188 | ) |
| Total shareholders' equity                                     |   |        | 122,366 |   |         |   | 142,303 |   |
| Total liabilities and shareholders' equity                     |   | $           | 998,437 |   |         | $      | 1,029,731 |   |

----

|                                                  |   | Three months ended |       |
|-------------------------------------------------------|--------|--------------------|------------|
|                                                  |   | March 31,          |       |
|                                                  |   | 2011               |       |   | 2010 |   |
| INTEREST INCOME:                                      |   |               |       |
| Loans                                                 |   | $                  | 10,816     |   |   | $ | 10,106 |   |
| Federal funds sold                                    |   |               | 82         |   |   |   | 59 |   |
| Investment securities available for sale              |   |               | 802        |   |   |   | 547 |   |
| Interest bearing deposits in other banks              |   |               | 10         |   |   |   | 45 |   |
| Total interest income                                 |   |               | 11,710     |   |   |   | 10,757 |   |
|                                                  |   |               |       |   |   |   |   |   |
| INTEREST EXPENSE:                                     |   |               |       |   |   |   |   |   |
| Deposits:                                             |   |               |       |   |   |   |   |   |
| Interest-bearing demand                               |   |               | 1          |   |   |   | 2 |   |
| Money market and savings                              |   |               | 227        |   |   |   | 358 |   |
| Certificates of deposit                               |   |               | 78         |   |   |   | 281 |   |
| Other                                                 |   |               | 346        |   |   |   | 241 |   |
| Total interest expense                                |   |               | 652        |   |   |   | 882 |   |
|                                                  |   |               |       |   |   |   |   |   |
| Net interest income                                   |   |               | 11,058     |   |   |   | 9,875 |   |
| Provision for credit losses                           |   |               | 750        |   |   |   | 1,250 |   |
| Net interest income after provision for credit losses |   |               | 10,308     |   |   |   | 8,625 |   |
|                                                  |   |               |       |   |   |   |   |   |
| NON-INTEREST INCOME:                                  |   |               |       |   |   |   |   |   |
| Service charges on deposit accounts                   |   |               | 675        |   |   |   | 545 |   |
| Gain on sale of SBA loans                             |   |               | 641        |   |   |   | - |   |
| International fee income                              |   |               | 546        |   |   |   | 428 |   |
| Other non interest income                             |   |               | 684        |   |   |   | 653 |   |
| Total non-interest income                             |   |               | 2,546      |   |   |   | 1,626 |   |
|                                                  |   |               |       |   |   |   |   |   |
| OPERATING EXPENSES:                                   |   |               |       |   |   |   |   |   |
| Salaries and benefits                                 |   |               | 5,378      |   |   |   | 5,284 |   |
| Premises and fixed assets                             |   |               | 972        |   |   |   | 1,052 |   |
| Other                                                 |   |               | 3,887      |   |   |   | 3,317 |   |
| Total operating expenses                              |   |               | 10,237     |   |   |   | 9,653 |   |
|                                                  |   |               |       |   |   |   |   |   |
| Income before income taxes                            |   |               | 2,617      |   |   |   | 598 |   |
| Income taxes                                          |   |               | 1,047      |   |   |   | 233 |   |
| Net income                                            |   | $                  | 1,570      |   |   | $ | 365 |   |
|                                                  |   |               |       |   |   |   |   |   |
| Preferred dividends                                   |   |               | 200        |   |   |   | 1,060 |   |
| Net income (loss) available to common shareholders    |   |               | 1,370      |   |   |   | (695 | ) |
|                                                  |   |               |       |   |   |   |   |   |
| Basic income (loss) per share                         |   | $                  | 0.10       |   |   | $ | (0.11 | ) |
| Diluted income (loss) per share                       |   | $                  | 0.09       |   |   | $ | (0.11 | ) |
| Average common shares outstanding                     |   |               | 14,089,577 |   |   |   | 6,576,923 |   |
| Average common and equivalent shares outstanding      |   |               | 14,466,839 |   |   |   | 6,576,923 |   |

----

|                                                                              |   | Three months ended March 31, |    |
|-----------------------------------------------------------------------------------|--------|------------------------------|---------|
|                                                                              |   | 2011                         |    |   | 2010 |   |
|                                                                              |   |                         |    |   |   |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:                                             |   |                         |    |   |   |   |
| Net income                                                                        |   | $                            | 1,570   |   |   | $ | 365 |   |
| Adjustments to reconcile net income to net cash provided by operating activities: |   |                         |    |   |   |   |   |   |
| Provision for credit losses                                                       |   |                         | 750     |   |   |   | 1,250 |   |
| Depreciation and amortization                                                     |   |                         | 294     |   |   |   | 672 |   |
| Net (gain) loss on sale of other real estate owned                                |   |                         | (262    | ) |   |   | - |   |
| Stock based compensation                                                          |   |                         | 282     |   |   |   | 345 |   |
| Loans originated for sale                                                         |   |                         | (6,141  | ) |   |   | (6,592 | ) |
| Proceeds from loan sales                                                          |   |                         | 10,763  |   |   |   | - |   |
| Net (gain) loss on sale of securities                                             |   |                         | 93      |   |   |   | 164 |   |
| Deferred income tax (credit)                                                      |   |                         | 112     |   |   |   | - |   |
| (Increase) decrease in accrued interest receivable and other assets               |   |                         | 1,153   |   |   |   | 902 |   |
| Increase (decrease) in accrued interest payable and other liabilities             |   |                         | 16,550  |   |   |   | (1,679 | ) |
| Net cash (used in) provided by operating activities                               |   |                         | 25,164  |   |   |   | (4,573 | ) |
|                                                                              |   |                         |    |   |   |   |   |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                             |   |                         |    |   |   |   |   |   |
| Purchase of securities available for sale                                         |   |                         | (70,074 | ) |   |   | (36,437 | ) |
| Proceeds from sale of securities available for sale                               |   |                         | 21,392  |   |   |   | 21,142 |   |
| Proceeds from maturity of securities available for sale                           |   |                         | 62,890  |   |   |   | 13,060 |   |
| Proceeds from the sale of other real estate owned                                 |   |                         | 3,051   |   |   |   | 3,697 |   |
| Net decrease (increase)  in loans                                       |   |                         | 8,296   |   |   |   | (7,588 | ) |
| Net decrease (increase) in interest bearing deposits in other banks               |   |                         | 979     |   |   |   | 1,927 |   |
| Purchase of fixed assets                                                          |   |                         | (110    | ) |   |   | (116 | ) |
| Net cash (used in) provided by investing activities                               |   |                         | 26,424  |   |   |   | (4,315 | ) |
|                                                                              |   |                         |    |   |   |   |   |   |
| CASH FLOW FROM FINANCING ACTIVITIES:                                              |   |                         |    |   |   |   |   |   |
| Net (decrease) increase  in deposits                                    |   |                         | (20,235 | ) |   |   | 13,578 |   |
| (Decrease) in other borrowings                                                    |   |                         | (7,672  | ) |   |   | - |   |
| Common stock issued                                                               |   |                         | 988     |   |   |   | 31,477 |   |
| Redemption of preferred stock                                                     |   |                         | (23,864 | ) |   |   | (30,000 | ) |
| Payment of cash dividends                                                         |   |                         | (200    | ) |   |   | (257 | ) |
| Net cash provided by (used in) financing activities                               |   |                         | (50,983 | ) |   |   | 14,798 |   |
|                                                                              |   |                         |    |   |   |   |   |   |
| NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS:                                  |   |                         | 605     |   |   |   | 5,910 |   |
| Cash and equivalents at beginning of period                                       |   |                         | 122,916 |   |   |   | 119,153 |   |
| Cash and equivalents at end of period                                             |   | $                            | 123,521 |   |   | $ | 125,063 |   |
|                                                                              |   |                         |    |   |   |   |   |   |
| OTHER CASH FLOW INFORMATION:                                                      |   |                         |    |   |   |   |   |   |
| Cash paid for interest                                                            |   | $                            | 576     |   |   | $ | 630 |   |
| Cash paid for income taxes                                                        |   | $                            | 18      |   |   | $ | 88 |   |
|                                                                              |   |                         |    |   |   |   |   |   |
| NON-CASH INVESTING ACTIVITIES:                                                    |   |                         |    |   |   |   |   |   |
| Loans transferred to other real estate owned                                      |   | $                            | 5,810   |   |   | $ | 3,814 |   |

----

----

|                                                                                         |   | Three months ended |   |
|----------------------------------------------------------------------------------------------|--------|--------------------|--------|
| (dollars in thousands)                                                                       |   | March 31,          |   |
|                                                                                         |   | 2011               |   |   | 2010 |   |
|                                                                                         |   |               |   |   |   |   |
| Net income                                                                                   |   | $                  | 1,570  |   |   | $ | 365 |   |
|                                                                                         |   |               |   |   |   |   |   |   |
| Other comprehensive earnings- Net unrealized gains (losses) on securities available for sale |   |               | 1,175  |   |   |   | 327 |   |
| Net unrealized gains (losses) on supplemental executive retirement plan                      |   |               | 6      |   |   |   | 7 |   |
| Net unrealized gains (losses) on cash flow hedges                                            |   |               | 107    |   |   |   | (282 | ) |
|                                                                                         |   |               |   |   |   |   |   |   |
| Total comprehensive income (loss)                                                            |   | $                  | 2,858  |   |   | $ | 417 |   |

----

----

|                                                      |   | Three months ended |       |
|-----------------------------------------------------------|--------|--------------------|------------|
| (dollars in thousands, except per share amounts)          |   | March 31,          |       |
|                                                      |   | 2011               |       |   | 2010 |   |
|                                                      |   |               |       |   |   |   |
| Net income                                                |   | $                  | 1,570      |   |   | $ | 365 |   |
| Less:  dividends on preferred shares            |   |               | (200       | ) |   |   | (1,060 | ) |
| Net income (loss) available to common shareholders        |   |               | 1,370      |   |   |   | (695 | ) |
|                                                      |   |               |       |   |   |   |   |   |
| Weighted average shares used in computing                 |   |               |       |   |   |   |   |   |
| basic earnings (loss) per share                           |   |               | 14,089,577 |   |   |   | 6,576,923 |   |
| Diluted potential common shares related to stock options, |   |               |       |   |   |   |   |   |
| restricted stock, and preferred stock                     |   |               | 377,262    |   |   |   | - |   |
| Total average common shares and equivalents               |   |               | 14,466,839 |   |   |   | 6,576,923 |   |
|                                                      |   |               |       |   |   |   |   |   |
| Basic earnings (loss) per share                           |   | $                  | 0.10       |   |   | $ | (0.11 | ) |
| Diluted earnings (loss) per share                         |   | $                  | 0.09       |   |   | $ | (0.11 | ) |

----

| (dollars in thousands)              |   | As of March 31, 2011 |    |
|-------------------------------------|--------|----------------------|---------|
|                                |   |                 |    |   | Gross Unrealized |   |   | Fair |   |
|                                |   | Cost                 |    |   | Gains |   |   | Losses |   |   | Value |   |
| Debt Securities:                    |   |                 |    |   |   |   |   |   |   |   |   |   |
| U.S. government agencies            |   | $                    | 31,849  |   |   | $ | 68 |   |   | $ | (126 | ) |   | $ | 31,791 |   |
| Mortgage backed securities          |   |                 | 127,335 |   |   |   | 969 |   |   |   | (276 | ) |   |   | 128,028 |   |
| Collateralized mortgage obligations |   |                 | 17,680  |   |   |   | 43 |   |   |   | (3 | ) |   |   | 17,720 |   |
| Corporate bonds                     |   |                 | 26,634  |   |   |   | 44 |   |   |   | (40 | ) |   |   | 26,638 |   |
| Total debt securities               |   |                 | 203,498 |   |   |   | 1,124 |   |   |   | (445 | ) |   |   | 204,177 |   |
| Equity Securities:                  |   |                 | -       |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Total securities available for sale |   |                 | 203,498 |   |   |   | 1,124 |   |   |   | (445 | ) |   |   | 204,177 |   |
|                                |   |                 |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total investment securities         |   | $                    | 203,498 |   |   | $ | 1,124 |   |   | $ | (445 | ) |   | $ | 204,177 |   |

|                                |   | As of December 31, 2010 |    |
|-------------------------------------|--------|-------------------------|---------|
|                                |   |                    |    |   | Gross Unrealized |   |   | Fair |   |
|                                |   | Cost                    |    |   | Gains |   |   | Losses |   |   | Value |   |
| Debt Securities:                    |   |                    |    |   |   |   |   |   |   |   |   |   |
| U.S. government agency notes        |   | $                       | 49,417  |   |   | $ | 218 |   |   | $ | (61 | ) |   | $ | 49,574 |   |
| Mortgage backed securities          |   |                    | 121,105 |   |   |   | 360 |   |   |   | (1,845 | ) |   |   | 119,620 |   |
| Collateralized mortgage obligations |   |                    | -       |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Corporate bonds                     |   |                    | 7,908   |   |   |   | 48 |   |   |   | - |   |   |   | 7,956 |   |
| Total debt securities               |   |                    | 178,430 |   |   |   | 626 |   |   |   | (1,906 | ) |   |   | 177,150 |   |
| Equity Securities:                  |   |                    | 40,153  |   |   |   |   |   |   |   |   |   |   |   | 40,153 |   |
| Total Securities Available for Sale |   |                    | 218,583 |   |   |   | 626 |   |   |   | (1,906 | ) |   |   | 217,303 |   |
|                                |   |                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Investment Securities         |   | $                       | 218,583 |   |   | $ | 626 |   |   | $ | (1,906 | ) |   | $ | 217,303 |   |

| (dollars in thousands)                     |   | March 31, 2011 |    |
|--------------------------------------------|--------|----------------|---------|
|                                       |   | Amortized      |    |   | Fair |   |
|                                       |   | Cost           |    |   | Value |   |
|                                       |   |           |    |   |   |   |
| Due in one year or less                    |   | $              | 13,446  |   |   | $ | 13,582 |   |
| Due after one year through five years      |   |           | 80,801  |   |   |   | 81,271 |   |
| Due after five years through ten years     |   |           | 45,209  |   |   |   | 45,394 |   |
| Due after ten years                        |   |           | 64,042  |   |   |   | 63,930 |   |
| Total debt securities available for sale   |   |           | 203,498 |   |   |   | 204,177 |   |
|                                       |   |           |    |   |   |   |   |   |
| Total equity securities available for sale |   |           | -       |   |   |   | - |   |
|                                       |   |           |    |   |   |   |   |   |
| Total investment securities                |   | $              | 203,498 |   |   | $ | 204,177 |   |

----

| (dollars in thousands)                     |   | December 31, 2010 |    |
|--------------------------------------------|--------|-------------------|---------|
|                                       |   | Amortized         |    |   | Fair |   |
|                                       |   | Cost              |    |   | Value |   |
|                                       |   |              |    |   |   |   |
| Due in one year or less                    |   | $                 | 23,924  |   |   | $ | 24,050 |   |
| Due after one year through five years      |   |              | 67,159  |   |   |   | 67,142 |   |
| Due after five years through ten years     |   |              | 38,207  |   |   |   | 37,364 |   |
| Due after ten years                        |   |              | 49,140  |   |   |   | 48,594 |   |
| Total debt securities available for sale   |   |              | 178,430 |   |   |   | 177,150 |   |
|                                       |   |              |    |   |   |   |   |   |
| Total equity securities available for sale |   |              | 40,153  |   |   |   | 40,153 |   |
|                                       |   |              |    |   |   |   |   |   |
| Total investment securities                |   | $                 | 218,583 |   |   | $ | 217,303 |   |

|                              |   | March 31, |    |   | December 31, |   |
|-----------------------------------|--------|-----------|---------|--------|--------------|--------|
| (dollars in thousands)            |   | 2011      |    |   | 2010         |   |
|                              |   |      |    |   |         |   |
| Commercial                        |   | $         | 256,865 |   |         | $      | 269,034 |   |
| Real estate construction          |   |      | 35,291  |   |         |   | 40,705 |   |
| Land loans                        |   |      | 8,235   |   |         |   | 9,072 |   |
| Real estate other                 |   |      | 139,499 |   |         |   | 138,633 |   |
| Factoring and asset based lending |   |      | 122,052 |   |         |   | 122,542 |   |
| SBA                               |   |      | 65,537  |   |         |   | 67,538 |   |
| Other                             |   |      | 4,193   |   |         |   | 4,023 |   |
| Total gross loans                 |   |      | 631,672 |   |         |   | 651,547 |   |
| Unearned fee income               |   |      | (1,422  | )      |         |   | (1,444 | ) |
| Total loan portfolio              |   |      | 630,250 |   |         |   | 650,103 |   |
| Less allowance for credit losses  |   |      | (15,171 | )      |         |   | (15,546 | ) |
| Loans, net                        |   | $         | 615,079 |   |         | $      | 634,557 |   |

----

| Risk category of loans:           |   |
|-----------------------------------|--------|
| (dollars in thousands)            |   |
|                              |   | As of March 31, 2011 |   |
|                              |   |   |   |   | Performing |   |   |   |   |   |   |   |
|                              |   | Pass |   |   | (Criticized) |   |   | Impaired |   |   | Total |   |
|                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                        |   | $ | 244,715 |   |   | $ | 10,785 |   |   | $ | 1,365 |   |   | $ | 256,865 |   |
| Real estate construction          |   |   | 33,309 |   |   |   | 1,982 |   |   |   | - |   |   |   | 35,291 |   |
| Land loans                        |   |   | 4,281 |   |   |   | 1,359 |   |   |   | 2,595 |   |   |   | 8,235 |   |
| Real estate other                 |   |   | 96,395 |   |   |   | 35,452 |   |   |   | 7,652 |   |   |   | 139,499 |   |
| Factoring and asset based lending |   |   | 117,595 |   |   |   | 4,457 |   |   |   | - |   |   |   | 122,052 |   |
| SBA                               |   |   | 57,785 |   |   |   | 7,543 |   |   |   | 209 |   |   |   | 65,537 |   |
| Other                             |   |   | 837 |   |   |   | 3,356 |   |   |   | - |   |   |   | 4,193 |   |
| Total gross loans                 |   | $ | 554,918 |   |   | $ | 64,933 |   |   | $ | 11,821 |   |   | $ | 631,672 |   |

|                              |   | As of December 31, 2010 |    |
|-----------------------------------|--------|-------------------------|---------|
|                              |   |                    |    |   | Performing |   |   |   |   |   |   |   |
|                              |   | Pass                    |    |   | (Criticized) |   |   | Impaired |   |   | Total |   |
|                              |   |                    |    |   |   |   |   |   |   |   |   |   |
| Commercial                        |   | $                       | 258,336 |   |   | $ | 9,568 |   |   | $ | 1,130 |   |   | $ | 269,034 |   |
| Real estate construction          |   |                    | 31,395  |   |   |   | 3,968 |   |   |   | 5,342 |   |   |   | 40,705 |   |
| Land loans                        |   |                    | 4,384   |   |   |   | 1,512 |   |   |   | 3,176 |   |   |   | 9,072 |   |
| Real estate other                 |   |                    | 93,959  |   |   |   | 38,041 |   |   |   | 6,633 |   |   |   | 138,633 |   |
| Factoring and asset based lending |   |                    | 121,753 |   |   |   | 789 |   |   |   | - |   |   |   | 122,542 |   |
| SBA                               |   |                    | 60,315  |   |   |   | 6,995 |   |   |   | 228 |   |   |   | 67,538 |   |
| Other                             |   |                    | 822     |   |   |   | 3,014 |   |   |   | 187 |   |   |   | 4,023 |   |
| Total gross loans                 |   | $                       | 570,964 |   |   | $ | 63,887 |   |   | $ | 16,696 |   |   | $ | 651,547 |   |

----

| Past due and nonaccrual loans:    |   |
|-----------------------------------|--------|
| (dollars in thousands)            |   | As of March 31, 2011 |   |
|                              |   | Still Accruing |   |   |   |   |
|                              |   | 30-89 Days |   |   | Over 90 Days |   |   | Nonaccrual / |   |
|                              |   | Past Due |   |   | Past Due |   |   | Impaired |   |
|                              |   |   |   |   |   |   |   |   |   |
| Commercial                        |   | $ | - |   |   | $ | - |   |   | $ | 1,365 |   |
| Real estate construction          |   |   | - |   |   |   | - |   |   |   | - |   |
| Land loans                        |   |   | 399 |   |   |   | - |   |   |   | 2,595 |   |
| Real estate other                 |   |   | - |   |   |   | 2,442 |   |   |   | 7,652 |   |
| Factoring and asset based lending |   |   | - |   |   |   | - |   |   |   | - |   |
| SBA                               |   |   | 49 |   |   |   | - |   |   |   | 209 |   |
| Other                             |   |   | 0 |   |   |   | - |   |   |   | - |   |
| Total gross loans                 |   | $ | 448 |   |   | $ | 2,442 |   |   | $ | 11,821 |   |

| (dollars in thousands)            |   | As of December 31, 2010 |   |
|-----------------------------------|--------|-------------------------|--------|
|                              |   | Still Accruing          |   |   |   |   |
|                              |   | 30-89 Days              |   |   | Over 90 Days |   |   | Nonaccrual / |   |
|                              |   | Past Due                |   |   | Past Due |   |   | Impaired |   |
|                              |   |                    |   |   |   |   |   |   |   |
| Commercial                        |   | $                       | 1,860  |   |   | $ | - |   |   | $ | 1,130 |   |
| Real estate construction          |   |                    | -      |   |   |   | - |   |   |   | 5,342 |   |
| Land loans                        |   |                    | -      |   |   |   | - |   |   |   | 3,176 |   |
| Real estate other                 |   |                    | -      |   |   |   | - |   |   |   | 6,633 |   |
| Factoring and asset based lending |   |                    | -      |   |   |   | - |   |   |   | - |   |
| SBA                               |   |                    | 19     |   |   |   | - |   |   |   | 228 |   |
| Other                             |   |                    | -      |   |   |   | - |   |   |   | 187 |   |
| Total gross loans                 |   | $                       | 1,879  |   |   | $ | - |   |   | $ | 16,696 |   |

| Impaired loans:                   |   |
|-----------------------------------|--------|
| (dollars in thousands)            |   | As of March 31, 2011 |   |
|                              |   | Upaid |   |   |   |   |   | Average |   |
|                              |   | Principal |   |   | Recorded |   |   | Recorded |   |
|                              |   | Balance |   |   | Investment |   |   | Investment |   |
|                              |   |   |   |   |   |   |   |   |   |
| Commercial                        |   | $ | 2,586 |   |   | $ | 1,365 |   |   | $ | 1,041 |   |
| Real estate construction          |   |   | - |   |   |   | - |   |   |   | 2,111 |   |
| Land loans                        |   |   | 4,619 |   |   |   | 2,595 |   |   |   | 3,654 |   |
| Real estate other                 |   |   | 9,483 |   |   |   | 7,652 |   |   |   | 6,343 |   |
| Factoring and asset based lending |   |   | - |   |   |   | - |   |   |   | - |   |
| SBA                               |   |   | 374 |   |   |   | 209 |   |   |   | 221 |   |
| Other                             |   |   | - |   |   |   | - |   |   |   | 97 |   |
| Total gross loans                 |   | $ | 17,062 |   |   | $ | 11,821 |   |   | $ | 13,467 |   |

----

| (dollars in thousands)            |   | As of December 31, 2010 |   |
|-----------------------------------|--------|-------------------------|--------|
|                              |   | Upaid                   |   |   |   |   |   | Average |   |
|                              |   | Principal               |   |   | Recorded |   |   | Recorded |   |
|                              |   | Balance                 |   |   | Investment |   |   | Investment |   |
|                              |   |                    |   |   |   |   |   |   |   |
| Commercial                        |   | $                       | 2,116  |   |   | $ | 1,130 |   |   | $ | 1,020 |   |
| Real estate construction          |   |                    | 7,653  |   |   |   | 5,342 |   |   |   | 5,632 |   |
| Land loans                        |   |                    | 5,288  |   |   |   | 3,176 |   |   |   | 4,132 |   |
| Real estate other                 |   |                    | 7,861  |   |   |   | 6,633 |   |   |   | 6,441 |   |
| Factoring and asset based lending |   |                    | -      |   |   |   | - |   |   |   | 77 |   |
| SBA                               |   |                    | 390    |   |   |   | 228 |   |   |   | 369 |   |
| Other                             |   |                    | -      |   |   |   | 187 |   |   |   | 189 |   |
| Total gross loans                 |   | $                       | 23,308 |   |   | $ | 16,696 |   |   | $ | 17,860 |   |

----

| Analysis of the allowance for credit losses: |   |
|----------------------------------------------|--------|
| (dollars in thousands)                       |   | March 31, |   |   | March 31, |   |
|                                         |   | 2011 |   |   | 2010 |   |
|                                         |   |   |   |   |   |   |
| Balance, beginning of period                 |   | $ | 15,546 |   |   | $ | 16,012 |   |
| Loans charged off by category:               |   |   |   |   |   |   |   |   |
| Commercial and other                         |   |   | 727 |   |   |   | 889 |   |
| Real estate construction                     |   |   | - |   |   |   | - |   |
| Real estate land                             |   |   | 340 |   |   |   | 20 |   |
| Real estate other                            |   |   | 690 |   |   |   | 537 |   |
| Factoring and asset-based lending            |   |   | - |   |   |   | - |   |
| Consumer                                     |   |   | - |   |   |   | 606 |   |
| Total charge-offs                            |   |   | 1,757 |   |   |   | 2,051 |   |
| Recoveries by category:                      |   |   |   |   |   |   |   |   |
| Commercial and other                         |   |   | 38 |   |   |   | 159 |   |
| Real estate construction                     |   |   | 491 |   |   |   | 778 |   |
| Real estate land                             |   |   | 102 |   |   |   | 7 |   |
| Real estate other                            |   |   | - |   |   |   | - |   |
| Factoring and asset-based lending            |   |   | - |   |   |   | - |   |
| Consumer                                     |   |   | - |   |   |   | - |   |
| Total recoveries                             |   |   | 632 |   |   |   | 944 |   |
| Net charge-offs (recoveries)                 |   |   | 1,125 |   |   |   | 1,107 |   |
| Provision charged to expense                 |   |   | 750 |   |   |   | 1,250 |   |
| Balance, end of period                       |   | $ | 15,171 |   |   | $ | 16,155 |   |

|  5. | Premises and Equipment |
|----------|------------------------|

| (dollars in thousands)  |   | March 31, 2011 |   |
|-------------------------|--------|----------------|--------|
|                    |   |           |   |   | Accumulated |   |   | Net Book |   |
|                    |   | Cost           |   |   | Depreciation |   |   | Value |   |
|                    |   |           |   |   |   |   |   |   |   |
| Leasehold improvements  |   | $              | 5,434  |   |   | $ | (3,667 | ) |   | $ | 1,767 |   |
| Furniture and fixtures  |   |           | 1,092  |   |   |   | (973 | ) |   |   | 119 |   |
| Capitalized software    |   |           | 3,259  |   |   |   | (3,004 | ) |   |   | 255 |   |
| Equipment               |   |           | 2,403  |   |   |   | (2,148 | ) |   |   | 255 |   |
| Construction in process |   |           | -      |   |   |   | - |   |   |   | - |   |
| Totals                  |   | $              | 12,188 |   |   | $ | (9,792 | ) |   | $ | 2,396 |   |

----

| (dollars in thousands)  |   | December 31, 2010 |   |
|-------------------------|--------|-------------------|--------|
|                    |   |              |   |   | Accumulated |   |   | Net book |   |
|                    |   | Cost              |   |   | Depreciation |   |   | Value |   |
|                    |   |              |   |   |   |   |   |   |   |
| Leasehold improvements  |   | $                 | 5,427  |   |   | $ | (3,506 | ) |   | $ | 1,921 |   |
| Furniture and fixtures  |   |              | 1,075  |   |   |   | (952 | ) |   |   | 123 |   |
| Capitalized software    |   |              | 3,220  |   |   |   | (2,938 | ) |   |   | 282 |   |
| Equipment               |   |              | 2,356  |   |   |   | (2,102 | ) |   |   | 254 |   |
| Construction in process |   |              | -      |   |   |   | - |   |   |   | - |   |
| Totals                  |   | $                 | 12,078 |   |   | $ | (9,498 | ) |   | $ | 2,580 |   |

----

|                    |   | Three months ended March 31, |   |
|-------------------------|--------|------------------------------|--------|
|                    |   | 2011                         |   |   | 2010 |   |
|                    |   |                         |   |   |   |   |
| Expected life           |   | 75 months                    |   |   | 75 months |   |
|                    |   |                         |   |   |   |   |
| Stock volatility        |   |                         | 35.00  | % |   |   | 45.00 | % |
|                    |   |                         |   |   |   |   |   |   |
| Risk free interest rate |   |                         | 2.50   | % |   |   | 2.69 | % |
|                    |   |                         |   |   |   |   |   |   |
| Dividend yield          |   |                         | 0.00   | % |   |   | 0.00 | % |
|                    |   |                         |   |   |   |   |   |   |
| Fair value per share    |   | $                            | 3.56   |   |   | $ | 3.35 |   |

| (dollars in thousands)        |   | As of March 31, 2011 |    |
|-------------------------------|--------|----------------------|---------|
|                          |   |                 |    |   |   |   |   |   |   |   |   |   |
|                          |   | Total                |    |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|                          |   |                 |    |   |   |   |   |   |   |   |   |   |
| Securities available for sale |   | $                    | 204,177 |   |   | $ | - |   |   | $ | 204,177 |   |   | $ | - |   |
| Cash flow hedge               |   |                 | (1,572  | ) |   |   | - |   |   |   | (1,572 | ) |   |   | - |   |
| Warrant portfolio             |   |                 | 724     |   |   |   | - |   |   |   | - |   |   |   | 724 |   |
|                          |   |                 |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                         |   | $                    | 203,329 |   |   | $ | - |   |   | $ | 202,605 |   |   | $ | 724 |   |

----

| (dollars in thousands)        |   | As of December 31, 2010 |    |
|-------------------------------|--------|-------------------------|---------|
|                          |   |                    |    |   |   |   |   |   |   |   |   |   |
|                          |   | Total                   |    |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|                          |   |                    |    |   |   |   |   |   |   |   |   |   |
| Securities available for sale |   | $                       | 217,303 |   |   | $ | - |   |   | $ | 217,303 |   |   | $ | - |   |
| Cash flow hedge               |   |                    | (1,750  | ) |   |   | - |   |   |   | (1,750 | ) |   |   | - |   |
| Warrant portfolio             |   |                    | 724     |   |   |   | - |   |   |   | - |   |   |   | 724 |   |
|                          |   |                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                         |   | $                       | 216,277 |   |   | $ | - |   |   | $ | 215,553 |   |   | $ | 724 |   |

| (dollars in thousands)                   |   | March 31, 2011 |    |   | December 31, 2010 |   |
|------------------------------------------|--------|----------------|---------|--------|-------------------|--------|
|                                     |   | Carrying       |    |   | Fair              |   |   | Carrying |   |   | Fair |   |
|                                     |   | Value          |    |   | Value             |   |   | Value |   |   | Value |   |
|                                     |   |           |    |   |              |   |   |   |   |   |   |   |
| Financial assets:                        |   |           |    |   |              |   |   |   |   |   |   |   |
| Cash and due from banks                  |   | $              | 15,001  |   |              | $      | 15,001 |   |   | $ | 8,676 |   |   | $ | 8,676 |   |
| Federal funds sold                       |   |           | 108,520 |   |              |   | 108,520 |   |   |   | 114,240 |   |   |   | 114,240 |   |
| Interest bearing deposits in other banks |   |           | 1,560   |   |              |   | 1,560 |   |   |   | 2,539 |   |   |   | 2,539 |   |
| Investments securities                   |   |           | 204,177 |   |              |   | 204,177 |   |   |   | 217,303 |   |   |   | 217,303 |   |
| Loans and leases, gross                  |   |           | 630,250 |   |              |   | 637,311 |   |   |   | 650,103 |   |   |   | 663,030 |   |
| Bank owned life insurance                |   |           | 10,490  |   |              |   | 10,490 |   |   |   | 10,393 |   |   |   | 10,393 |   |
|                                     |   |           |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Financial liabilities:                   |   |           |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                 |   |           | 827,711 |   |              |   | 826,208 |   |   |   | 847,946 |   |   |   | 846,701 |   |
| Trust preferred securities               |   |           | 17,527  |   |              |   | 17,895 |   |   |   | 17,527 |   |   |   | 17,607 |   |
| Other borrowings                         |   |           | -       |   |              |   | - |   |   |   | 7,672 |   |   |   | 7,650 |   |
| Cash flow hedge                          |   |           | (1,572  | )      |              |   | (1,572 | ) |   |   | (1,750 | ) |   |   | (1,750 | ) |

----

|                              |   |              |   | Fair Value |   |
|-----------------------------------|--------|-------------------|--------|------------|--------|
| Derivatives Designated as Hedging |   | Balance Sheet     |   | March 31,  |   |   | December 31, |   |
| Instruments Under SFAS 133        |   | Location          |   | 2010       |   |   | 2010 |   |
|                              |   |              |   |       |   |   |   |   |
| Interest rate contracts           |   | Other liabilities |   | $          | 1,572  |   |   | $ | 1,750 |   |
|                              |   |              |   |       |   |   |   |   |   |   |
| Total hedged derivatives          |   |              |   | $          | 1,572  |   |   | $ | 1,750 |   |

----

|                                                                                                                   |   | Interest Income             |   |   | Non-Interest Income         |   |   | Total Income                |   |
|------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|--------|--------|-----------------------------|--------|--------|-----------------------------|--------|
|                                                                                                                   |   | Three monthsended March 31, |   |   | Three monthsended March 31, |   |   | Three monthsended March 31, |   |
|                                                                                                                   |
|                                                                                                                   |   | 2011                        |   |   | 2010                        |   |   | 2011                        |   |   | 2010 |   |   | 2011 |   |   | 2009 |   |
|                                                                                                                   |   |                        |   |   |                        |   |   |                        |   |   |   |   |   |   |   |   |   |   |
| Amount of gain reclassified from AOCI into income - effective portion                                                  |   | $                           | (113   | )      |                        | $      | 57     |                        |   | $ | - |   |   | $ | 21 |   |   | $ | (113 | ) |   | $ | 78 |   |
|                                                                                                                   |   |                        |   |   |                        |   |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Amount of gain recognized in income on derivative - ineffective portion and amount excluded from effectiveness testing |   |                        | -      |   |                        |   | -      |                        |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                                                   |   |                        |   |   |                        |   |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total derivative income                                                                                                |   | $                           | (113   | )      |                        | $      | 57     |                        |   | $ | - |   |   | $ | 21 |   |   | $ | (113 | ) |   | $ | 78 |   |

----

----

----

----

| (dollars in thousands, except per share data)         |   | Three months ended |      |
|-------------------------------------------------------|--------|--------------------|-----------|
|                                                  |   | March 31,          |      |
|                                                  |   | 2011               |      |   | 2010 |   |
| Statement of Operations Data:                         |   |               |      |   |   |   |
|                                                  |   |               |      |   |   |   |
| Interest income                                       |   | $                  | 11,710    |   |   | $ | 10,757 |   |
| Interest expense                                      |   |               | 652       |   |   |   | 882 |   |
| Net interest income                                   |   |               | 11,058    |   |   |   | 9,875 |   |
| Provision for credit losses                           |   |               | 750       |   |   |   | 1,250 |   |
| Net interest income after provision for credit losses |   |               | 10,308    |   |   |   | 8,625 |   |
| Other income                                          |   |               | 2,546     |   |   |   | 1,626 |   |
| Other expenses                                        |   |               | 10,237    |   |   |   | 9,653 |   |
| Income before income taxes                            |   |               | 2,617     |   |   |   | 598 |   |
| Income taxes                                          |   |               | 1,047     |   |   |   | 233 |   |
| Net income                                            |   | $                  | 1,570     |   |   | $ | 365 |   |
| Preferred dividends                                   |   |               | 200       |   |   |   | 1,060 |   |
| Net income (loss) available to common shareholders    |   | $                  | 1,370     |   |   | $ | (695 | ) |
|                                                  |   |               |      |   |   |   |   |   |
| Per Share Data:                                       |   |               |      |   |   |   |   |   |
| Basic earnings (loss) per share                       |   | $                  | 0.10      |   |   | $ | (0.11 | ) |
| Diluted earnings (loss) per share                     |   |               | 0.09      |   |   |   | (0.11 | ) |
| Shareholders' equity per share                        |   |               | 8.12      |   |   |   | 8.00 |   |
| Cash dividend per common share                        |   |               | -         |   |   |   | - |   |
|                                                  |   |               |      |   |   |   |   |   |
| Balance Sheet Data:                                   |   |               |      |   |   |   |   |   |
| Balance sheet totals:                                 |   |               |      |   |   |   |   |   |
| Assets                                                |   | $                  | 998,437   |   |   | $ | 858,771 |   |
| Loans, net                                            |   |               | 615,079   |   |   |   | 568,093 |   |
| Deposits                                              |   |               | 827,711   |   |   |   | 718,625 |   |
| Shareholders' equity                                  |   |               | 122,366   |   |   |   | 110,493 |   |
|                                                  |   |               |      |   |   |   |   |   |
| Average balance sheet amounts:                        |   |               |      |   |   |   |   |   |
| Assets                                                |   | $                  | 1,024,796 |   |   | $ | 843,770 |   |
| Loans, net                                            |   |               | 610,257   |   |   |   | 553,386 |   |
| Deposits                                              |   |               | 850,633   |   |   |   | 702,621 |   |
| Shareholders' equity                                  |   |               | 135,635   |   |   |   | 109,754 |   |
|                                                  |   |               |      |   |   |   |   |   |
| Selected Ratios:                                      |   |               |      |   |   |   |   |   |
| Return on average assets                              |   |               | 0.62      | % |   |   | 0.18 | % |
| Return on average equity                              |   |               | 4.69      | % |   |   | 1.35 | % |
| Efficiency ratio                                      |   |               | 75.25     | % |   |   | 83.93 | % |
| Risk based capital ratio                              |   |               | 18.23     | % |   |   | 19.23 | % |
| Net chargeoffs to average gross loans                 |   |               | 0.18      | % |   |   | 0.19 | % |
| Allowance for loan losses to total loans              |   |               | 2.40      | % |   |   | 2.76 | % |
| Average equity to average assets                      |   |               | 13.24     | % |   |   | 13.01 | % |

----

|                                               |   | Three months ended |   |   |     |   |
|----------------------------------------------------|--------|------------------------------|--------|--------|----------|--------|
|                                               |   | March 31,               |   |   | Increase |   |
| (dollars in thousands)                   |   | 2011                         |   |   | 2010     |   |   | (Decrease) |   |
|                                               |   |                         |   |   |     |   |   |   |   |
| Interest income                                    |   | $                            | 11,710 |   |     | $      | 10,757 |   |   | $ | 953 |   |
| Interest expense                                   |   |                         | 652    |   |     |   | 882 |   |   |   | (230 | ) |
|                                               |   |                         |   |   |     |   |   |   |   |   |   |   |
| Net interest income                                |   |                         | 11,058 |   |     |   | 9,875 |   |   |   | 1,183 |   |
| Provision for credit losses                        |   |                         | 750    |   |     |   | 1,250 |   |   |   | (500 | ) |
|                                               |   |                         |   |   |     |   |   |   |   |   |   |   |
| Net interest income after provision                |   |                         |   |   |     |   |   |   |   |   |   |   |
| for credit losses                                  |   |                         | 10,308 |   |     |   | 8,625 |   |   |   | 1,683 |   |
| Other income                                       |   |                         | 2,546  |   |     |   | 1,626 |   |   |   | 920 |   |
| Other expenses                                     |   |                         | 10,237 |   |     |   | 9,653 |   |   |   | 584 |   |
| Income before income taxes                         |   |                         | 2,617  |   |     |   | 598 |   |   |   | 2,019 |   |
|                                               |   |                         |   |   |     |   |   |   |   |   |   |   |
| Income taxes                                       |   |                         | 1,047  |   |     |   | 233 |   |   |   | 814 |   |
| Net income                                         |   | $                            | 1,570  |   |     | $      | 365 |   |   | $ | 1,205 |   |
|                                               |   |                         |   |   |     |   |   |   |   |   |   |   |
| Preferred dividends                                |   |                         | 200    |   |     |   | 1,060 |   |   |   | (860 | ) |
| Net income (loss) available to common shareholders |   | $                            | 1,370  |   |     | $      | (695 | ) |   | $ | 2,065 |   |

----

|                               |   | Three months ended March 31, |      |
|------------------------------------|--------|--------------------------------------------------|-----------|
| (dollars in thousands)   |   | 2011                                             |      |   | 2010 |   |
|                               |   |                                             |      |   | Yields |   |   | Interest |   |   |   |   |   | Yields |   |   | Interest |   |
|                               |   | Average                                          |      |   | or |   |   | Income/ |   |   | Average |   |   | or |   |   | Income/ |   |
|                               |   | Balance                                          |      |   | Rates |   |   | Expense |   |   | Balance |   |   | Rates |   |   | Expense |   |
| ASSETS                             |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest earning assets (2):       |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans (1)                          |   | $                                                | 627,315   |   |   |   | 7.0 | % |   | $ | 10,816 |   |   | $ | 571,049 |   |   |   | 7.2 | % |   | $ | 10,106 |   |
| Federal funds sold                 |   |                                             | 142,862   |   |   |   | 0.2 | % |   |   | 82 |   |   |   | 101,928 |   |   |   | 0.2 | % |   |   | 59 |   |
| Investment securities              |   |                                             | 188,549   |   |   |   | 1.7 | % |   |   | 802 |   |   |   | 111,235 |   |   |   | 2.0 | % |   |   | 547 |   |
| Other                              |   |                                             | 4,544     |   |   |   | 0.9 | % |   |   | 10 |   |   |   | 9,056 |   |   |   | 2.0 | % |   |   | 45 |   |
| Total interest earning assets      |   |                                             | 963,270   |   |   |   | 4.9 | % |   |   | 11,710 |   |   |   | 793,268 |   |   |   | 5.5 | % |   |   | 10,757 |   |
|                               |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Noninterest-earning assets:        |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash and due from banks            |   |                                             | 21,994    |   |   |   |   |   |   |   |   |   |   |   | 16,495 |   |   |   |   |   |   |   |   |   |
| All other assets (3)               |   |                                             | 39,532    |   |   |   |   |   |   |   |   |   |   |   | 34,007 |   |   |   |   |   |   |   |   |   |
| TOTAL                              |   | $                                                | 1,024,796 |   |   |   |   |   |   |   |   |   |   | $ | 843,770 |   |   |   |   |   |   |   |   |   |
|                               |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES AND                    |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| SHAREHOLDERS' EQUITY               |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest bearing liabilities:      |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits:                          |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand                             |   | $                                                | 6,545     |   |   |   | 0.1 | % |   |   | 1 |   |   | $ | 6,058 |   |   |   | 0.1 | % |   | $ | 2 |   |
| Savings                            |   |                                             | 345,187   |   |   |   | 0.3 | % |   |   | 227 |   |   |   | 274,861 |   |   |   | 0.5 | % |   |   | 358 |   |
| Time                               |   |                                             | 43,608    |   |   |   | 0.7 | % |   |   | 78 |   |   |   | 75,335 |   |   |   | 1.5 | % |   |   | 281 |   |
| Other                              |   |                                             | 24,436    |   |   |   | 5.7 | % |   |   | 346 |   |   |   | 17,749 |   |   |   | 5.5 | % |   |   | 241 |   |
| Total interest bearing liabilities |   |                                             | 419,776   |   |   |   | 0.6 | % |   |   | 652 |   |   |   | 374,003 |   |   |   | 1.0 | % |   |   | 882 |   |
|                               |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Noninterest-bearing liabilities:   |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                    |   |                                             | 455,292   |   |   |   |   |   |   |   |   |   |   |   | 346,367 |   |   |   |   |   |   |   |   |   |
| Accrued expenses and               |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| other liabilities                  |   |                                             | 14,093    |   |   |   |   |   |   |   |   |   |   |   | 13,646 |   |   |   |   |   |   |   |   |   |
| Shareholders' equity               |   |                                             | 135,635   |   |   |   |   |   |   |   |   |   |   |   | 109,754 |   |   |   |   |   |   |   |   |   |
| TOTAL                              |   | $                                                | 1,024,796 |   |   |   |   |   |   |   |   |   |   | $ | 843,770 |   |   |   |   |   |   |   |   |   |
|                               |   |                                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income and margin     |   |                                             |      |   |   |   | 4.7 | % |   | $ | 11,058 |   |   |   |   |   |   |   | 5.0 | % |   | $ | 9,875 |   |

----

| (1) | Loan fee amortization of $1.2 million and $897,000, respectively, is included in interest income.  Nonperforming loans have been included in average loan balances. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Interest income is reflected on an actual basis, not a fully taxable equivalent basis.  Yields are based on amortized cost. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Net of average allowance for credit losses of $15.7 million and $16.2 million, respectively. |
|-----|----------------------------------------------------------------------------------------------|

| (dollars in thousands) |   | Three months ended March 31,        |   |
|----------------------------------|--------|---------------------------------------------------------|--------|
|                             |   | 2011 vs. 2010                                 |   |
|                             |   |  Increase(decrease)due to change in |   |
|                             |   | Average                                                 |   |   | Average |   |   | Total |   |
|                             |   | Volume                                                  |   |   | Rate |   |   | Change |   |
| Interest income:                 |   |                                                    |   |   |   |   |   |   |   |
| Loans                            |   | $                                                       | 970    |   |   | $ | (260 | ) |   | $ | 710 |   |
| Federal funds sold               |   |                                                    | 23     |   |   |   | (0 | ) |   |   | 23 |   |
| Investment securities            |   |                                                    | 329    |   |   |   | (74 | ) |   |   | 255 |   |
| Other                            |   |                                                    | (10    | ) |   |   | (25 | ) |   |   | (35 | ) |
| Total interest income            |   |                                                    | 1,313  |   |   |   | (360 | ) |   |   | 953 |   |
|                             |   |                                                    |   |   |   |   |   |   |   |   |   |   |
| Interest expense:                |   |                                                    |   |   |   |   |   |   |   |   |   |   |
| Demand                           |   |                                                    | 0      |   |   |   | (1 | ) |   |   | (1 | ) |
| Savings                          |   |                                                    | 46     |   |   |   | (177 | ) |   |   | (131 | ) |
| Time                             |   |                                                    | (57    | ) |   |   | (146 | ) |   |   | (203 | ) |
| Other                            |   |                                                    | 95     |   |   |   | 10 |   |   |   | 105 |   |
| Total interest expense           |   |                                                    | 84     |   |   |   | (314 | ) |   |   | (230 | ) |
|                             |   |                                                    |   |   |   |   |   |   |   |   |   |   |
| Change in net interest income    |   | $                                                       | 1,228  |   |   | $ | (45 | ) |   | $ | 1,183 |   |

----

|                             |   | Three months ended |   |
|----------------------------------|--------|------------------------------|--------|
| (dollars in thousands) |   | March 31,               |   |
|                             |   | 2011                         |   |   | 2010 |   |
|                             |   |                         |   |   |   |   |
| Balance, beginning of period     |   | $                            | 15,546 |   |   | $ | 16,012 |   |
| Provision for credit losses      |   |                         | 750    |   |   |   | 1,250 |   |
| Charge-offs                      |   |                         | (1,757 | ) |   |   | (2,051 | ) |
| Recoveries                       |   |                         | 632    |   |   |   | 944 |   |
| Balance, end of period           |   | $                            | 15,171 |   |   | $ | 16,155 |   |

----

| (dollars in thousands) |   | March 31, 2011 |   |   | December 31, 2010 |   |
|----------------------------------|--------|--------------------------|--------|--------|-----------------------------|--------|
|                             |   |                     |   |   | Percent of             |   |   |   |   |   | Percent of |   |
|                             |   |                     |   |   | ALLL in each      |   |   |   |   |   | ALLL in each |   |
|                             |   |                     |   |   | category to            |   |   |   |   |   | category to |   |
|                             |   | Amount                   |   |   | gross loans            |   |   | Amount |   |   | gross loans |   |
|                             |   |                     |   |   |                        |   |   |   |   |   |   |   |
| Commercial                       |   | $                        | 4,606  |   |                        |   | 0.7 | % |       | $ | 4,616 |   |   |   | 0.7 | % |
| Real estate construction         |   |                     | 1,159  |   |                        |   | 0.2 | % |   | $ | 1,628 |   |   |   | 0.2 | % |
| Land loans                       |   |                     | 637    |   |                        |   | 0.1 | % |   | $ | 622 |   |   |   | 0.1 | % |
| Real estate other                |   |                     | 5,158  |   |                        |   | 0.8 | % |   | $ | 5,358 |   |   |   | 0.8 | % |
| SBA                              |   |                     | 1,760  |   |                        |   | 0.3 | % |   | $ | 1,670 |   |   |   | 0.3 | % |
| Factoring/ABL                    |   |                     | 1,764  |   |                        |   | 0.3 | % |   | $ | 1,575 |   |   |   | 0.2 | % |
| Other                            |   |                     | 87     |   |                        |   | 0.0 | % |   | $ | 77 |   |   |   | 0.0 | % |
|                             |   | $                        | 15,171 |   |                        |   | 2.3 | % |   | $ | 15,546 |   |   |   | 2.4 | % |

----

|                                                                                              |   | March 31, |   |   | December 31, |   |
|---------------------------------------------------------------------------------------------------|--------|----------------|--------|--------|-------------------|--------|
| (dollars in thousands)                                                                  |   | 2011           |   |   | 2010              |   |
|                                                                                              |   |           |   |   |              |   |
| Loans accounted for on a non-accrual basis                                                        |   | $              | 11,821 |   |              | $      | 16,696 |   |
| Other loans with principal or interest contracturally past due 90 days or more and still accruing |   |           | 2,442  |   |              |   | - |   |
| Nonperforming loans                                                                               |   |           | 14,263 |   |              |   | 16,696 |   |
| Other real estate owned                                                                           |   |           | 9,666  |   |              |   | 6,645 |   |
| Nonperforming assets                                                                              |   | $              | 23,929 |   |              | $      | 23,341 |   |
|                                                                                              |   |           |   |   |              |   |   |   |
| Loans restructured and in compliance with modified terms                                          |   |           | 4,456  |   |              |   | 4,494 |   |
|                                                                                              |   |           |   |   |              |   |   |   |
| Nonperforming assets and restructured loans                                                       |   | $              | 28,385 |   |              | $      | 27,835 |   |

| March 31, 2010        |
|---------------------------------|
|  Classification       |   | Amount |   | Collateral |
|                            |   |   |   |   |
|  Land                      |   |   | 1,723 |   | Lots for retail development in Sacramento County |
|  Land                      |   |   | 627 |   | Lots for single family homes in Santa Clara County |
|  Land                      |   |   | 205 |   | Lots for single family homes in Idaho |
|  Land                      |   |   | 40 |   | Lot for commercial development in Calaveras County |
|                            |   |   | 2,595 |   |   |
|                            |   |   |   |   |   |
|  Real estate other         |   |   | 6,518 |   | Special purpose facility in Santa Cruz County |
|  Real estate other         |   |   | 758 |   | Commercial building in Santa Clara County |
|  Real estate other         |   |   | 600 |   | Single family residence in Placer County |
|  Real estate other         |   |   | 349 |   | Single family residence in Santa Clara County |
|  Real estate other         |   |   | 191 |   | Commercial office space in Santa Clara County |
|  Real estate other         |   |   | 185 |   | Single family residence in San Francisco County |
|  Real estate other         |   |   | 62 |   | Single family residence in Santa Cruz County |
|  Real estate other         |   |   | 12 |   | Light industrial warehouse space in Stanislaus County |
|  Real estate other         |   |   | 6 |   | Single family residence in Santa Clara County |
|                            |   |   | 8,681 |   |   |
|                            |   |   |   |   |   |
|  Commercial                |   |   | 286 |   | Business assets |
|  Commercial                |   |   | 259 |   | Business assets |
|                            |   |   | 545 |   |   |
|                            |   |   |   |   |   |
|  Total nonperforming loans |   | $ | 11,821 |   |   |

----

----

|                                         |   | Three months ended March 31, |   |
|----------------------------------------------|--------|------------------------------|--------|
|  (dollars in thousands)  |   | 2011                         |   |   | 2010 |   |
|                                         |   | Amount                       |   |   | Percent |   |   | Amount |   |   | Percent |   |
|                                         |   |                         |   |   |   |   |   |   |   |   |   |   |
| Depositor service charges                    |   | $                            | 675    |   |   |   | 26.5 | % |   | $ | 545 |   |   |   | 33.5 | % |
| Gain on sale of SBA loans                    |   |                         | 641    |   |   |   | 25.2 | % |   |   | - |   |   |   | 0.0 | % |
| Foreign exchange upcharge                    |   |                         | 546    |   |   |   | 21.4 | % |   |   | 428 |   |   |   | 26.3 | % |
| Gain on Sale of OREO                         |   |                         | 262    |   |   |   | 10.3 | % |   |   | 199 |   |   |   | 12.2 | % |
| Warrant income                               |   |                         | 187    |   |   |   | 7.3 | % |   |   | - |   |   |   | 0.0 | % |
| Increase in value of life insurance          |   |                         | 97     |   |   |   | 3.8 | % |   |   | 97 |   |   |   | 6.0 | % |
| SBA loan servicing income                    |   |                         | 80     |   |   |   | 3.1 | % |   |   | 107 |   |   |   | 6.6 | % |
| Net gain (loss) on sale of securities        |   |                         | (93    | ) |   |   | -3.7 | % |   |   | 164 |   |   |   | 10.1 | % |
| Other income-cash flow hedge                 |   |                         | -      |   |   |   | 0.0 | % |   |   | 21 |   |   |   | 1.3 | % |
| Other operating income                       |   |                         | 151    |   |   |   | 5.9 | % |   |   | 65 |   |   |   | 4.0 | % |
|                                         |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                         |   | $                            | 2,546  |   |   |   | 100.0 | % |   | $ | 1,626 |   |   |   | 100.0 | % |

----

|                                         |   | Three months ended March 31, |   |
|----------------------------------------------|--------|--------------------------------------------------|--------|
|  (dollars in thousands)  |   | 2011                                             |   |   | 2010 |   |
|                                         |   | Amount                                           |   |   | Percent |   |   | Amount |   |   | Percent |   |
|                                         |   |                                             |   |   |   |   |   |   |   |   |   |   |
|  Salaries and benefits                  |   | $                                                | 5,378  |   |   |   | 2.3 | % |   | $ | 5,284 |   |   |   | 2.2 | % |
|  Occupancy                              |   |                                             | 839    |   |   |   | 0.4 | % |   |   | 841 |   |   |   | 0.4 | % |
|  Data processing                        |   |                                             | 737    |   |   |   | 0.3 | % |   |   | 718 |   |   |   | 0.3 | % |
|  Marketing/Advertising                  |   |                                             | 305    |   |   |   | 0.1 | % |   |   | 236 |   |   |   | 0.1 | % |
|  Deposit services                       |   |                                             | 246    |   |   |   | 0.1 | % |   |   | 203 |   |   |   | 0.1 | % |
|  Legal and professional                 |   |                                             | 578    |   |   |   | 0.2 | % |   |   | 642 |   |   |   | 0.3 | % |
|  Loan/OREO                              |   |                                             | 586    |   |   |   | 0.2 | % |   |   | 340 |   |   |   | 0.1 | % |
|  Furniture and equipment                |   |                                             | 133    |   |   |   | 0.1 | % |   |   | 211 |   |   |   | 0.1 | % |
|  Other                                  |   |                                             | 1,435  |   |   |   | 0.6 | % |   |   | 1,178 |   |   |   | 0.5 | % |
|                                         |   |                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                         |   | $                                                | 10,237 |   |   |   | 4.3 | % |   | $ | 9,653 |   |   |   | 4.1 | % |

----

| (dollars in thousands)  |   | March 31, |    |   | December 31, |   |
|-----------------------------------|--------|----------------|---------|--------|-------------------|--------|
|                              |   | 2011           |    |   | 2010              |   |
|                              |   |           |    |   |              |   |
| Commercial                        |   | $              | 256,865 |   |              | $      | 269,034 |   |
| Real estate construction          |   |           | 35,291  |   |              |   | 40,705 |   |
| Land loans                        |   |           | 8,235   |   |              |   | 9,072 |   |
| Real estate other                 |   |           | 139,499 |   |              |   | 138,633 |   |
| Factoring and asset based lending |   |           | 122,052 |   |              |   | 122,542 |   |
| SBA                               |   |           | 65,537  |   |              |   | 67,538 |   |
| Other                             |   |           | 4,193   |   |              |   | 4,023 |   |
| Total gross loans                 |   |           | 631,672 |   |              |   | 651,547 |   |
| Unearned fee income               |   |           | (1,422  | )      |              |   | (1,444 | ) |
| Total  loans            |   |           | 630,250 |   |              |   | 650,103 |   |
| Less allowance for credit losses  |   |           | (15,171 | )      |              |   | (15,546 | ) |
| Total loans, net                  |   | $              | 615,079 |   |              | $      | 634,557 |   |
|                              |   |           |    |   |              |   |   |   |
| Commercial                        |   |           | 40.7    | %      |              |   | 41.3 | % |
| Real estate construction          |   |           | 5.6     | %      |              |   | 6.2 | % |
| Land loans                        |   |           | 1.3     | %      |              |   | 1.4 | % |
| Real estate other                 |   |           | 22.1    | %      |              |   | 21.3 | % |
| Factoring and asset based lending |   |           | 19.3    | %      |              |   | 18.8 | % |
| SBA                               |   |           | 10.4    | %      |              |   | 10.4 | % |
| Other                             |   |           | 0.7     | %      |              |   | 0.6 | % |
| Total gross loans                 |   |           | 100.0   | %      |              |   | 100.0 | % |

----

| (dollars in thousands)      |   | March 31, |    |   | December 31, |   |
|---------------------------------------|--------|----------------|---------|--------|-------------------|--------|
|                                  |   | 2011           |    |   | 2010              |   |
|                                  |   | Amount         |    |   | Percent           |   |   | Amount |   |   | Percent |   |
|                                  |   |           |    |   |              |   |   |   |   |   |   |   |
| Noninterest-bearing  demand |   | $              | 475,287 |   |              |   | 57.42 | % |   | $ | 443,806 |   |   |   | 52.34 | % |
| Interest-bearing demand               |   |           | 5,096   |   |              |   | 0.62 | % |   |   | 5,275 |   |   |   | 0.62 | % |
| Money market and savings              |   |           | 305,113 |   |              |   | 36.86 | % |   |   | 355,772 |   |   |   | 41.96 | % |
| Certificates of deposit:              |   |           |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Less than $100                        |   |           | 5,024   |   |              |   | 0.61 | % |   |   | 9,212 |   |   |   | 1.09 | % |
| $100 and more                         |   |           | 37,191  |   |              |   | 4.49 | % |   |   | 33,881 |   |   |   | 4.00 | % |
|                                  |   |           |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Total deposits                        |   | $              | 827,711 |   |              |   | 100.00 | % |   | $ | 847,946 |   |   |   | 100.00 | % |

----

----

----

----

|                               |   | As of March 31, |    |   | As of December 31, |   |
|------------------------------------|--------|--------------------------------|---------|--------|-----------------------------------|--------|
| (dollars in thousands)   |   | 2011                           |    |   | 2010                              |   |
|                               |   | Amount                         |    |   | Ratio                             |   |   | Amount |   |   | Ratio |   |
|                               |   |                           |    |   |                              |   |   |   |   |   |   |   |
| Company Capital Ratios             |   |                           |    |   |                              |   |   |   |   |   |   |   |
| Tier 1 Capital                     |   | $                              | 140,215 |   |                              |   | 16.98 | %   |   | $ | 161,448 |   |   |   | 19.61 | % |
| (to Risk Weighted Assets)          |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Tier 1 capital minimum requirement |   | $                              | 49,559  |   |                              |   | 6.00 | % |   | $ | 49,403 |   |   |   | 6.00 | % |
|                               |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Total Capital                      |   | $                              | 150,599 |   |                              |   | 18.23 | % |   | $ | 171,634 |   |   |   | 20.84 | % |
| (to Risk Weighted Assets)          |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Total capital minimum requirement  |   | $                              | 82,598  |   |                              |   | 10.00 | % |   | $ | 82,339 |   |   |   | 10.00 | % |
|                               |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Company Leverage                   |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Tier 1 Capital                     |   | $                              | 140,215 |   |                              |   | 13.68 | % |   | $ | 161,448 |   |   |   | 16.67 | % |
| (to Average Assets)                |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Tier 1 capital minimum requirement |   | $                              | 51,239  |   |                              |   | 5.00 | % |   | $ | 48,429 |   |   |   | 5.00 | % |
|                               |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
|                               |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Bank Capital Ratios                |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Tier 1 Capital                     |   | $                              | 117,010 |   |                              |   | 14.37 | % |   | $ | 117,010 |   |   |   | 14.37 | % |
| (to Risk Weighted Assets)          |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Tier 1 capital minimum requirement |   | $                              | 48,860  |   |                              |   | 6.00 | % |   | $ | 48,860 |   |   |   | 6.00 | % |
|                               |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Total Capital                      |   | $                              | 127,239 |   |                              |   | 15.63 | % |   | $ | 127,239 |   |   |   | 15.63 | % |
| (to Risk Weighted Assets)          |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Total capital minimum requirement  |   | $                              | 81,433  |   |                              |   | 10.00 | % |   | $ | 81,433 |   |   |   | 10.00 | % |
|                               |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Bank Leverage                      |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Tier 1 Capital                     |   | $                              | 117,010 |   |                              |   | 11.45 | % |   | $ | 117,010 |   |   |   | 11.45 | % |
| (to Average Assets)                |   |                           |    |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| Tier 1 capital minimum requirement |   | $                              | 51,086  |   |                              |   | 5.00 | % |   | $ | 51,086 |   |   |   | 5.00 | % |

----

| (dollars in thousands)                       |   | As of March 31, 2011 |    |
|--------------------------------------------------------|--------|------------------------------------------|---------|
|                                                   |   |                                     |    |   | After three |   |   | After six |   |   | After one |   |   |   |   |   |   |   |
|                                                   |   | Within                                   |    |   | months but |   |   | months but |   |   | year but |   |   | After |   |   |   |   |
|                                                   |   | three                                    |    |   | within six |   |   | within one |   |   | within |   |   | five |   |   |   |   |
|                                                   |   | months                                   |    |   | months |   |   | year |   |   | five years |   |   | years |   |   | Total |   |
|                                                   |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal funds sold                                     |   | $                                        | 108,520 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | 108,520 |   |
| Interest bearing deposits in other banks               |   |                                     | 1,225   |   |   |   | 302 |   |   |   | 33 |   |   |   | - |   |   |   | - |   |   |   | 1,560 |   |
| Investment securities                                  |   |                                     | 6,031   |   |   |   | 4,291 |   |   |   | 3,260 |   |   |   | 81,271 |   |   |   | 109,324 |   |   |   | 204,177 |   |
| Loans                                                  |   |                                     | 214,100 |   |   |   | 46,556 |   |   |   | 69,365 |   |   |   | 167,548 |   |   |   | 134,103 |   |   |   | 631,672 |   |
| Total earning assets                                   |   | $                                        | 329,876 |   |   | $ | 51,149 |   |   | $ | 72,658 |   |   | $ | 248,819 |   |   | $ | 243,427 |   |   | $ | 945,929 |   |
|                                                   |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest checking, money  market and savings |   |                                     | 310,209 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 310,209 |   |
| Certificates of deposit:                               |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less than $100,000                                     |   |                                     | 2,395   |   |   |   | 1,959 |   |   |   | 530 |   |   |   | 140 |   |   |   | - |   |   |   | 5,024 |   |
| $100,000 or more                                       |   |                                     | 18,955  |   |   |   | 10,638 |   |   |   | 7,346 |   |   |   | 252 |   |   |   | - |   |   |   | 37,191 |   |
| Total interest-bearing liabilities                     |   | $                                        | 331,559 |   |   | $ | 12,597 |   |   | $ | 7,876 |   |   | $ | 392 |   |   | $ | - |   |   | $ | 352,424 |   |
|                                                   |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest rate gap                                      |   | $                                        | (1,683  | ) |   | $ | 38,552 |   |   | $ | 64,782 |   |   | $ | 248,427 |   |   | $ | 243,427 |   |   | $ | 593,505 |   |
| Cumulative interest rate gap                           |   | $                                        | (1,683  | ) |   | $ | 36,869 |   |   | $ | 101,651 |   |   | $ | 350,078 |   |   | $ | 593,505 |   |   |   |   |   |
|                                                   |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest rate gap ratio                                |   |                                     | (0.01   | ) |   |   | 0.75 |   |   |   | 0.89 |   |   |   | 1.00 |   |   |   | 1.00 |   |   |   |   |   |
| Cumulative interest rate gap ratio                     |   |                                     | (0.01   | ) |   |   | 0.10 |   |   |   | 0.22 |   |   |   | 0.50 |   |   |   | 0.63 |   |   |   |   |   |

----

| (dollars in thousands) |   | As of March 31, 2011 |    |
|----------------------------------|--------|------------------------------------------|---------|
|                             |   |                                     |    |   |   |   |   | Due after one |   |   |   |   |
|                             |   |                                     |    |   | Due one year |   |   | year through |   |   | Due after |   |
|                             |   | Amount                                   |    |   | or less |   |   | five years |   |   | five years |   |
|                             |   |                                     |    |   |   |   |   |   |   |   |   |   |
| Commercial and other             |   | $                                        | 256,865 |   |   | $ | 133,900 |   |   | $ | 86,343 |   |   | $ | 23,429 |   |
| SBA                              |   |                                     | 65,537  |   |   |   | 2,503 |   |   |   | 394 |   |   |   | 53,140 |   |
| Real estate construction         |   |                                     | 35,291  |   |   |   | 16,615 |   |   |   | 13,656 |   |   |   | 4,059 |   |
| Land loans                       |   |                                     | 8,235   |   |   |   | 9,033 |   |   |   | 1,020 |   |   |   | 2,192 |   |
| Real estate-other                |   |                                     | 139,499 |   |   |   | 29,451 |   |   |   | 36,608 |   |   |   | 79,900 |   |
| Factoring / Asset-Based Lending  |   |                                     | 122,052 |   |   |   | 81,861 |   |   |   | 6,266 |   |   |   | - |   |
| Other                            |   |                                     | 4,193   |   |   |   | 4,473 |   |   |   | 923 |   |   |   | - |   |
| Total loans                      |   | $                                        | 631,672 |   |   | $ | 277,836 |   |   | $ | 145,210 |   |   | $ | 162,720 |   |

|                              |   | As of December 31, 2010 |    |
|-----------------------------------|--------|---------------------------------------------|---------|
|                              |   |                                        |    |   |   |   |   | Due after one |   |   |   |   |
|                              |   |                                        |    |   | Due one year |   |   | year through |   |   | Due after |   |
|                              |   | Amount                                      |    |   | or less |   |   | five years |   |   | five years |   |
|                              |   |                                        |    |   |   |   |   |   |   |   |   |   |
| Commercial                        |   | $                                           | 269,034 |   |   | $ | 143,890 |   |   | $ | 103,977 |   |   | $ | 21,167 |   |
| Real estate construction          |   |                                        | 40,705  |   |   |   | 17,153 |   |   |   | 17,386 |   |   |   | 6,166 |   |
| Real estate land                  |   |                                        | 9,072   |   |   |   | 4,239 |   |   |   | 1,603 |   |   |   | 3,230 |   |
| Real estate other                 |   |                                        | 138,633 |   |   |   | 20,446 |   |   |   | 47,380 |   |   |   | 70,807 |   |
| Factoring and asset based lending |   |                                        | 122,542 |   |   |   | 98,722 |   |   |   | 23,820 |   |   |   |   |   |
| SBA                               |   |                                        | 67,538  |   |   |   | 2,867 |   |   |   | 1,245 |   |   |   | 63,426 |   |
| Other                             |   |                                        | 4,023   |   |   |   | 2,873 |   |   |   | 1,150 |   |   |   |   |   |
| Total loans                       |   | $                                           | 651,547 |   |   | $ | 290,190 |   |   | $ | 196,561 |   |   | $ | 164,796 |   |

| · | Any obligation under a guarantee contract that has the characteristics as defined in accounting guidance related to Guarantor’s Accounting and Disclosure Requirements for Guarantee including Indirect Guarantees of Indebtedness to Others; |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | A retained or contingent interest in assets transferred to an unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to that entity for such assets, such as a subordinated retained interest in a pool of receivables transferred to an unconsolidated entity; |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Any obligation, including a contingent obligation, under a contract that would be accounted for as a derivative instrument, except that it is both indexed to the registrant’s own stock and classified in stockholders’ equity; or |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Any obligation, including contingent obligations, arising out of a material variable interest, as defined in accounting guidance, in an unconsolidated entity that provides financing, liquidity, market risk or credit risk support to the registrant, or engages in leasing, hedging or research and development services with the registrant. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| · | Standby Letters of Credit in the amount of $15.0 million. |
|--------|-----------------------------------------------------------|

| (dollars in thousands) |   | As of March 31, 2011 |   |
|----------------------------------|--------|------------------------------------------|--------|
|                             |   | Payments due by period    |   |
|                             |   |                                     |   |   | Less than |   |   | 1 - 3 |   |   | 3 - 5 |   |   | More than |   |
|                             |   | Total                                    |   |   | 1 year |   |   | years |   |   | years |   |   | 5 years |   |
|                             |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term contracts              |   | $                                        | 9,271  |   |   | $ | 1,741 |   |   | $ | 3,469 |   |   | $ | 2,923 |   |   | $ | 1,138 |   |
|                             |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating leases                 |   |                                     | 4,104  |   |   |   | 798 |   |   |   | 1,392 |   |   |   | 1,392 |   |   |   | 522 |   |
|                             |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                            |   | $                                        | 13,375 |   |   | $ | 2,539 |   |   | $ | 4,861 |   |   | $ | 4,315 |   |   | $ | 1,660 |   |

----

----

|               |   | BRIDGE CAPITAL HOLDINGS                      |
|--------------------|--------|----------------------------------------------|
|               |   |                                         |
| Dated: May 5, 2011 | By:    | /s/ Daniel P. Myers                          |
|               |   |                                         |
|               |   | Daniel P. Myers                              |
|               |   | President and Chief Executive Officer        |
|               |   | (Principal Executive Officer)                |
|               |   |                                         |
| Dated: May 5, 2011 | By:    |   /s/ Thomas A. Sa                      |
|               |   |                                         |
|               |   | Thomas A. Sa                                 |
|               |   | Executive Vice President                     |
|               |   | Chief Financial Officer                      |
|               |   | (Principal Financial and Accounting Officer) |

----

| Exhibit |         |                                                                                                   |
|---------|--------------|--------------------------------------------------------------------------------------------------------|
| Number  |         | Description of Exhibit                                                                                 |
|    |         |                                                                                                   |
| (31.1)  |         | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|    |         |                                                                                                   |
| (31.2)  |         | Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|    |         |                                                                                                   |
| (32.1)  |         | Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350                        |
|    |         |                                                                                                   |
| (32.2)  |    | Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350                        |

----