2013 INDUSTRY VALUATION

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1 2013 INDUSTRY VALUATION The number of banks continued to dwindle in 2013, yet bank stocks recorded an exceptional year. At the end of 2013, there were 6,813 FDIC insured inancial institutions, a decline of 279 institutions over the year. That 3.9% drop essentially matched the percentage decline in 2012 and brought the number of banks to an historic low in the annuls of FDIC history. By the end of 2013, there were 17 fewer inancial institutions headquartered in California than at the start of the year. The number of publicly traded California banks declined, with 2013 ending with seven fewer banks in the Carpenter & Company tracking report. Scarcity may be a contributing factor for the exceptional stock performance of the California banking industry. Over 83% of the companies tracked in the Carpenter & company stock report recorded higher stock prices, and more than 85% of the companies with rising stock prices experienced price gains well in excess of 10%. Largely due to the run up in stock prices, the market capitalization of California s publicly traded banks and thrifts was 67% higher than at the end of NOTE: This analysis utilized data for bank assets, earnings, and share counts, as of September 30, INDUSTRY VALUATIONS: BANK MERGER AND ACQUISITION ACTIVITY The number of bank merger announcements in 2013 was essentially unchanged from the number of mergers announced in There were a total of 244 merger announcements involving U.S. inancial institutions made in 2012, according to SNL Financial. In 2013, the total number of inancial institution merger announcements equaled 242. Of the 2012 merger announcements, 218 were completed by year end 2013, ive were still pending, and 21 had been terminated. Through the irst 17 days of 2014, 143 of the mergers announced in 2013 had been completed, 85 were still pending, and 14 had been terminated. For the merger transactions with reported deal ratios, the average price to tangible book value (P/TBV) ratio for the 2013 announcements at 1.28x was slightly higher than the average P/TBV ratio of 1.20x for the 2012 merger announcements. Assets to be acquired under the 2012 non terminated merger announcements totaled $137.1 billion, compared with $111.6 billion for the non terminated merger announcements made in The largest merger by target size for the 2013 announcements was the pending acquisition by Umpqua of the $9.9 billion Sterling Financial. The largest merger from the 2012 announcements was M&T Bancorp s planned acquisition of the $43.6 billion Hudson City Bancorp. The M&T deal, which was announced on August 27, 2012, is currently scheduled to close by the end of According to company ilings, regulatory approval had been held up by BSA issues at M&T. CONTENTS Bank Merger activity... 1 National bank stock prices... 2 California bank stock prices... 3 CA banks under $125 million... 4 CA banks $125 $250 million... 6 CA banks $250 $500 million... 8 CA banks $500 million $1 billion... 9 CA banks $1 $5 billion CA banks $5 $10 billion CA banks $10 $100 billion CA thrifts California mergers LTM P/E ratios Price/Book ratios Ratio comparisons Stock performance under $125 million Stock performance $125 $250 million Stock performance $250 $500 million Stock performance $500 mln $1 bln Stock performance $1 $5 billion Stock performance $5 $10 billion Stock performance $10 $100 billion Stock performance thrifts Return rankings Carpenter & Company -1-

2 Industry Valuations For the merger announcements made in 2013, Texas was the state with the most merger targets at 29. The state in the distant second position for most mergers was Illinois at 14, and California was third with 13. The target asset size for the 2013 class of merger announcements ranged from $4.2 million (Oakwood State Bank) to $9.9 billion (Sterling Financial). The average asset size of the targets equaled $492 million, while the median size was $168 million. In 2012, the acquisition target size ranged between $7.4 million and $43.6 billion. The average target size for the 2012 merger announcements equaled $615 million, while the median merger size was $126 million. A total of 13 merger announcements in 2013 involved California institutions, compared with 14 announcements in All 14 of the 2012 California merger announcements were completed by year end 2013, while eight of the 13 announcements from 2013 were closed in Of the ive pending California acquisitions, two transactions involved the recapitalization of institutions by private investors, while the other three transactions will result in the further reduction in the number of banking charters in the state. For the irst 27 days of 2014, there had been 15 bank merger announcements made and involved $9.1 billion in target assets. Three of the announced acquisitions targeted institutions with more than $1 billion in assets. Reported deal ratios for the 2014 mergers announced through January 27 indicated a step up in pricing relative to tangible book value. Deal ratios were reported for 13 of the 15 merger announcements, with an average price to tangible book value of 1.45x. Two of the early 2014 announcements involved the acquisitions of publicly traded California banks, speci ically Bank on It, Inc. and North Valley Bancorp. INDUSTRY VALUATIONS: NATIONAL BANK STOCK PRICES One of the most featured economic news item in 2013 was the exceptional performance of the stock market. The Dow Jones Industrial Average climbed 26.5% in 2013 for the best market advance since In 2012, the increase from year end to year end for the Dow equaled 7.3%. In 2011, the gain was 5.5%. At no time over the course of last year was the Dow ever below its start of the year level. Over the 252 trading days in 2013, the Dow was higher in 146 of those days for a 58% ratio of up days. In addition, for 43 of the trading dates, the Dow increased by more than 100 points. The rise in equity market prices was broadly based. The S&P 500 index climbed 29.6% over the course of 2013, compared with the 13.4% rise in 2012 and no change in The trends for the NASDAQ were a decline of 1.8% in 2011, and gains of 15.9% in 2012 and 34.0% in The banking industry exceeded the exceptional stock performance of the broader market, as re lected in the results of the Dow, S&P 500, and NASDAQ indices. The KBW Bank stock index increased 35.1% over the course of 2013, besting the rise in the Dow by more than 8.5 percentage points. The 35.1% advance in the KBW index in 2013 followed the 30.2% advance that occurred in 2012, thus producing a two year increase in the KBW index of 76%. The two year gain in the Dow was 36%. 12/31= 1.0 Annual Change in DJIA J F M A M J J A S O N D 2013 Change in Stock Indices 1/1/13= KBW Bank 1.05 DJIA 1.00 J A J O Carpenter & Company -2-

3 Industry Valuations INDUSTRY VALUATIONS: CALIFORNIA BANK STOCK PRICES The trend toward declining populations of California banks and thrifts continued in At year end 2013, there were a total of 224 California headquartered banks and thrifts, a reduction of 17 over year end Sixteen banks were acquired by other inancial institutions, and there was one voluntary liquidation of a banking charter. No California inancial institution failed in 2013, nor was there any bank established. The number of publicly and actively traded California banks and thrifts declined in 2013, in line with the general trends for the banking industry. Over the past three years, the number of banks listed in the Carpenter & Company stock tracking report declined by the following counts: ten in 2011, six in 2012, and seven in The seven bank reduction in 2013 occurred despite adding Capital Source Bank to the tracking report. At the end of 2013, there were 137 companies featured in the tracking report, down from 150 in 2011 and 144 in The decline occurred entirely in the commercial banking sector. At year end 2013, the tracking report followed six thrifts and 131 commercial banks. Bank stock prices continued on an increasingly upward course in In 2012, 78% of the stocks in the Carpenter study experienced stock price gains for the year. In 2013, the gaining ratio rose to 83%. The share of stocks with annual price declines fell from 22% in 2012 to 15% in In contrast, 59% of the tracked companies in 2011 reported stock price declines on a year end to year end basis. As a result of the impressive gains in stock prices in 2013, California banks achieved signi icant increases in price to tangible book value (P/TBV) ratios. At the end of 2011, only 39 of the 150 publicly traded inancial institutions, (a 26% share) carried valuations in excess of tangible book value. In 2012, 54 of the 144 publiclytraded inancial institutions (a 38% share) were priced above book value. By the end of 2013, 88 banks were valued above TBV for a 63% share. The number of severely undervalued stocks was signi icantly less last year. In 2011, there were 23 companies valued at less than 50% of tangible book value. There were seven institutions at less than 50% of TBV in 2012 and only ive in Banks were grouped by size within seven asset classi ications, and there was one class entirely of thrifts in the tracking report. All eight classes achieved increased ratios of average stock prices to tangible book value in Compared to the watershed year for valuations in 2006, however, only two asset classes reported higher P/TBV ratios in 2013 than in The asset classes that exceeded 2006 ratios were $5 $10 billion banks and the thrift industry. Except for the smallest banking asset class (under $125 million), the groups analyzed were priced above tangible book value in 2013, up from 2012 when only four of the eight groups were valued above TBV. The highest average ratio for P/TBV occurred for banks in the $10 $100 billion range, beating out the $5 $10 billion group, which had carried the highest P/TBV average in The following table displays the P/TBV averages for the eight asset classes used in the Carpenter & Company stock tracking report. Average Stock Price to Tangible Book Value (At Year end) Change Low to CA Bank Size <$125 million % 8.7% $125 $250 million % 50.0% $250 $500 million % 81.5% $500 million $1 billion % 91.9% $1 $5 billion % 62.4% $5 $10 billion % 93.5% $10 $100 billion % 59.2% All Thrifts % 346.3% NOTE: Recent low is in bold font Carpenter & Company -3-

4 Industry Valuations From 2006 through 2010, the thrift class had been the lowest performing group in terms of P/TBV. Thrifts were tied for the third lowest in performance in 2011 and climbed to third best of the eight in Thrifts recorded in 2013 the largest percentage increase in P/TBV among the asset classes, up 74%. The smallest gain in 2013 P/ TBV was the 9% advance for banks under $125 million. The market capitalization for the California publicly traded banks and thrifts tracked by Carpenter & Company increased 67% in 2013 to a total of $43.2 billion, compared with $26.8 billion in This gain in total market capitalization occurred despite the seven bank reduction in the number of banks. As a result, the per bank market capitalization in 2013 expanded 75% over the previous year. INDUSTRY VALUATIONS: BANKS UNDER $125 MILLION Banks were analyzed by asset size in the Carpenter & Company stock market report. The smallest asset size studied were banks under $125 million. At the end of 2013, there were 22 publicly traded California banks with assets less than $125 million. The assets for this group and for all of the asset classes in this report were based upon data available at year end 2013, which were information from the September 30, 2013 Call Reports. The reported data for assets, share counts, tangible book value, and last twelve month (LTM) earnings utilized information as of September 30, There were two fewer banks with less than $125 million in assets at the end of 2013 than a year earlier. The movement in this asset class included three banks that grew above $125 million, one bank that was acquired, and two banks that declined in assets to rejoin this class. Twenty banks carried over in this group from Mojave Desert Bank, N.A. was acquired in January 2013 by Mission Bancorp, the parent company of Mission Bank, which is headquartered in Bakers ield. The $7.1 million purchase of Mojave Desert Bank was a cash and stock transaction, priced at 0.82x tangible book value. The price represented a 42% premium to the preannouncement trading price of MOJA. Northern California National Bank, Paci ic Alliance Bank, and Vibra Bank grew above $125 million in assets over the course of 2013 to join the next larger asset class. Bank on It, Inc. and Coast Bancorp declined in size to rejoin this group. As the cost of compiling with banking regulations increased to represent a rising expense for banks of all sizes, investor perceptions often viewed that a certain size of operations was critical for pro itable and future growth. As a result, some investors held that very small banks may face operational and earnings challenges. The under $125 million class had the lowest share of rising stock prices among the eight asset classes analyzed. Only 54% of the 22 stocks in this group experienced stock price gains in The next lowest share of price gains was the $125 $250 million group with a 77% share of stock price gainers. In 2013, stock prices for 13 of the 22 banks in this group were higher over the year, while eight stocks declined in price, and one bank reported no change in stock price. In 2012, the group of 24 banks under $125 million reported 13 banks with price gains and 11 banks with price declines. The steepest percentage price gain in 2013 was the 122% advance in the price of Mission Oaks Bancorp, wherein its stock price increased $0.11 over the year from $0.09/share in 2012 to $0.20/share at the end of In total, ten of the banks in this category experienced signi icant percentage gains in stock prices. Signi icant price gains were de ined as increases in excess of 10%. In addition to Mission Oaks, other signi icant price gains were recorded by Mother Lode Bank, Sierra Vista Bank, Chino Commercial Bancorp, Coast Bancorp, Pan Paci ic Bank, Bank on It, Inc., Delta National Bancorp, Security First Bank, and Friendly Hills Bank. Of the 11 banks with declining stock prices last year, four stocks dropped by more than 35%. The steepest stock price decline was 60% for U.S. Metro Bank. Carpenter & Company -4-

5 Industry Valuations BANKS UNDER $125 MILLION (continued) Price to Book CA Banks < $125 Million Largest Price Gains Mission Oaks Bancorp % Mother Lode Bank % Sierra Vista Bank +63.2% Steepest Price Decline US Metro Bank 59.7% The under $125 million asset class was the only group with an average price/tangible book value ratio that was less than 1.0x, that is, valued under tangible book. Only three banks in this class traded above book value, notably Chino Commercial Bancorp, Mother Lode Bank, and Tri Valley Bank. Chino Commercial Bank had the highest P/TBV of 1.57x. There were three banks that traded at less than 50% of book value. The lowest P/TBV for this group and for all publicly traded institutions was 0.08x for Golden State Bank. The other banks priced under 50% of book value were California Business Bank and Delta National Bancorp. Four companies, Coast Bancorp, Mission Oaks Bancorp, Pan American Bank, and Saigon National Bank, did not have meaningful P/TBV ratios and were not included in the average. The average P/TBV for the group with meaningful P/TBV equaled 0.75x, up from the 0.69x in As a rule, when a P/E ratio exceeded 50x, it was determined that pro its were too low relative to pricing to yield a meaningful ratio. Hence, P/E ratios in excess of 50x were cited as NM or not meaningful. In addition, if the bank sustained losses, the P/E ratio was shown as NM. Twelve of the 22 banks reported pro its for the last twelve months (LTM) ending September 30, Of these 12 pro itable banks, ten of the banks had meaningful price earnings ratios, that is, a ratio below 50x. The meaningful price to LTM earnings ratios for this asset class ranged from 9.55x for Cornerstone Community Bank to 33.52x for Sutter Community Bank. The average P/E for this class equaled 16.6x in 2013, up slightly from the 16.3x average for The trading volume for these banks was generally quite small. The volume of outstanding shares, notably those shares not held by insiders, also tended be quite limited for this asset class. As a result, the per bank trading volume for this asset class was the smallest of any of the classes. Nonetheless, all of the banks traded over the course of the year, and only two banks did not trade during December. One bank had its last posted trade in May. The combined volume of shares traded over the course of the year equaled 4.1 million, an approximate annual volume of 187,500 shares per bank. This average trading volume in 2013 was 23% lower than the average volume for the $125 $250 million asset class. The stock with the highest annual volume of trades in 2013 was Americas United Bank with over 1 million shares traded. The lowest volume was the 324 shares traded for Delta National Bancorp. The bank with the largest market capitalization at the end of 2013 was Americas United Bank at $16.5 million. Two banks carried market capitalization of less than $1 million, notably California Business Bank at $784,426 and Golden State Bank at $341,251. The total market capitalization of this group equaled $151 million, down from the $172 million in 2012 market capitalization. At the end of 2013, there were two fewer banks than in the prior year. Market capitalization on a per bank basis, however, edged lower in 2013 to $6.8 million from $7.1 million at the end of Of the 22 companies in this group, ifteen reported year over year (YoY) increases in market capitalization, six were down over the year, and one was essentially unchanged. Recapitalization by a private investor brought $7.9 million of new capital to California Business Bank. Sierra Vista Bank generated $1.5 million in new capital over the last twelve months ending September 30, Carpenter & Company -5-

6 Industry Valuations INDUSTRY VALUATIONS: BANKS BETWEEN $125 AND $250 MILLION The asset category with the largest number of banks was in the range of $125 and $250 million banks based upon September 30, 2013 data. At the end of December 2012, there were 47 banks in this class. Over the course of the past year, this group declined by eight to 39 banks. Within this class, 36 banks remained in the group over the year. One of these carry over banks changed its name from Ojai Community Bank to OCB Bancorp. Eleven banks exited this class. Two banks declined in size to rejoin the smallest asset class. Three banks were acquired by other banks. Six banks grew in assets to join the $250 $500 million class. Three banks grew into this class from the under $125 million group. Three publicly traded banks from the $125 to $250 million group were acquired in Visalia Community Bank was acquired on July 1, 2013 by Central Valley Community Bancorp in a 50/50 cash/stock transaction. The $21.3 million deal for Visalia Community Bank was valued at 1.24x tangible book value. Paci ic Premier Bancorp closed on its acquisition of San Diego Trust Bank on June 24, The acquisition of San Diego Trust Bank was through a cash/stock transaction valued at $31.1 million or 1.21x tangible book value. Sterling Financial Corporation acquired Commerce National Bank on October 1, 2013 in a cash purchase valued at $42.9 million or 1.43x tangible book value. Subsequently, Sterling Financial Corp. of Washington became the acquisition target of Umpqua Holdings Corp. of Oregon. Growing into this asset class from the under $125 million group were Northern California National Bank, Paci ic Alliance Bank, and Vibra Bank. Leaving this asset class to rejoin the under $125 million group were Bank on It, Inc. and Coast Bancorp. Growing into the $250 $500 million group were Focus Business Bank, Mission Valley Bancorp, Open Bank, Redwood Capital Bancorp, and Seacoast Commerce Bank. Coronado First Bank acquired privately held San Diego Private Bank on April 2, 2013 in an all stock transaction valued at $13.6 million or 1.04x tangible book value. Coronado First Bank changed its name to San Diego Private Bank and its ticker symbol SDPB and grew into the $250 $500 million class. In addition to the completed transactions involving banks in this group, Independence Bank announced on November 4, 2013 its intention to acquire Premier Service Bank. This pending 55% cash/45% stock transaction was valued at $8.6 million for a price to tangible book value ratio of 1.26x. At the beginning of 2013, Premier Service Bank had been under a merger agreement with First California Financial Group, Inc.; this agreement was terminated on January 30, Of the 39 banks in the $125 $250 million group at the end of December 2013, 31 banks reported YoY gains in stock prices. Seven banks reported lower stock prices, and one bank was unchanged in stock price over the year. Twenty three banks reported stock price gains in excess of 10%. Only one of the price declines exceeded 10%, notably OCB Bancorp at 14%. AltaPaci ic Bank ended 2013 with no change in stock price, despite reporting stock trading activity. Acquisition target Premier Service Bank experienced the steepest price increase last year, up 583%. Other triple digit price gains were realized for CalWest Bancorp (278%), Valley Community Bank (221%), Northern California Bancorp, Inc. (200%), and Uniti Financial Corp (149%). Other signi icant stock price gains were recorded for American California Bank, American Riviera Bank, Bank of Napa, N.A., Bank of Santa Clarita, Community Business Bank, Community Bank of the Bay, Community 1 st Bank, Bank of Southern California, N.A., First Mountain Bank, Golden Valley Bancorp, Liberty Bancorp, Inc., MNB Holdings Corp., Orange County Business Bank, Pinnacle Bank, Paci ic Alliance Bank, Paci ic Commerce Bank, ProAmerica Bank, River Valley Community Bank, and Summit Bancshares, Inc. Carpenter & Company -6-

7 Industry Valuations BANKS BETWEEN $125 AND $250 MILLION (continued) Banks within the $125 $250 million asset class were valued, on average, in excess of tangible book value for the irst time since In 2013, this asset class carried a P/TBV of 1.05x, up from 0.93x in Despite the 50% recovery from the 2009 low in P/TBV for this asset class, this valuation ratio was still 51% below the peak ratio of Twenty of the 39 banks in this class were valued in excess of tangible book value. For the second consecutive year, Capital Bank generated the highest price to TBV for this class with its P/TBV ratio of 2.05x. Of the 10 banks in this class that were valued below tangible book value, two banks had not meaningful P/TBV ratios. Two banks were valued at less than 0.50x tangible book value, speci ically Northern California Bancorp and Valley Community Bank. Banks that reported pro its for the last twelve months through September 30, 2013 represented 87% of the asset class. Only ive of the 39 banks had LTM losses. Three of the pro itable banks, speci ically AltaPaci ic Bank, Northern California Bancorp, and Vibra Bank, produced price/earnings ratios that exceeded 50x, thus were counted as having not meaningful ratios. The range of ratios for the 31 banks with meaningful P/E ratios equaled 3.05x for Pinnacle Bank to 36.25x for Orange County Business Bank. The average P/E ratio for this asset group was 16.14x, down from 17.2x in The total of number of shares traded last year for this asset class equaled 9.5 million. The per bank trading volume averaged 242,417, a 31% increase over the per bank trading volume in Share liquidity for this asset class was limited, nearly comparable to the smallest asset class. The lowest volumes of shares traded in 2013 were 1,439 for Bank of Southern California, while the most shares traded were posted by Community 1 st Bank at 911,327 shares. All but four of the stocks recorded a trade in December. Only one stock, American California Bank, did not record a trade in the fourth quarter of The market capitalization of this asset class equaled $683 million at the end of 2013, based upon year end stock prices and September 2013 share counts. The 2013 market capitalization for this class contrasted with the $760 million market capitalization at the end of With this class reporting eight fewer banks than at the end of 2012, the per bank market capitalization actually rose 16.4% over the year from $15.03 million at the end of 2012 to $17.50 million at the end of The bank with the highest reported market capitalization at the end of 2013 was AltaPaci ic Bank at $39.2 million. That bank had the highest market capitalization in 2012 as well. The bank with the lowest market capitalization continued to be Northern California Bancorp, although at $2.1 million, that bank s market capitalization was up 200% from its value at year end The signi icant gains in stock prices experienced by the majority of this asset class were the primary factors for the step up in per bank market capitalization in Capital Bank acquired nearly $2 million in additional capital during the twelve months ending September 30, Five of the 39 banks experienced reductions in market capitalization in Price to Book CA Banks $125 $250 Million Largest Price Gains Premier Service Bank % CalWest Bancorp % Northern CA Bancorp % Carpenter & Company -7-

8 Industry Valuations INDUSTRY VALUATIONS: BANKS BETWEEN $250 AND $500 MILLION The number of banks in the $250 $500 million asset class was unchanged in 2013 at 23 for the third consecutive year. Despite the consistency in the number of banks, the composition of banks within this asset class varied over the year. As in 2012, there were 17 carry over banks from the previous year. Six banks joined this class from the $125 $250 million group. Five banks grew to join the $500 million to $1 billion class. One bank was acquired by a larger in state bank. Joining this class in 2013 from the smaller group were Focus Business Bank, Mission Valley Bancorp, Open Bank, Redwood Capital Bancorp, Seacoast Commerce Bank, and San Diego Private Bank. Five of these six banks experienced organic asset growth, while the growth in San Diego Private Bank was assisted by the merger of equals between Coronado First Bank and in market San Diego Private Bank. Growing into the next larger asset class were California First National Bancorp, Commonwealth Business Bank, 1 st Century Bancshares, Inc., Plumas Bancorp, and Security California Bancorp. Bank of Alameda, the subsidiary bank of NorCal Community Bancorp, was acquired on November 29, 2013 by Bank of Marin Bancorp. Bank of Marin paid $32.5 million or 1.23x TBV in a cash/stock transaction for Bank of Alameda. The acquisition of NCAL Bancorp by privately held Grandpoint Capital, Inc. was terminated on January 28, On September 16, 2013, an announcement was made that a private investor would infuse $23.5 million in new capital to obtain a majority ownership of NCAL Bancorp, and existing directors will invest an additional $1.5 million into the company. This transaction was anticipated to close in the irst half of Heritage Oaks Bancorp announced on October 21, 2013 its intention to acquire in market Mission Community Bancorp. This cash stock transaction included the assumption of debt in a deal valued at $56.0 million or 1.63x tangible book value. Over the course of 2013, nineteen banks in this class experienced stock price gains, while four stocks declined in price. Following the termination of the announced acquisition by Grandpoint, the price of NCAL edged steadily lower over the year to produce the steepest annual stock price decline of 72%. Seventeen of the 19 stocks recorded signi icant, over 10%, gains in stock prices in The steepest price gain was recorded for Open Bank, up 257%. Other double digit rates of stock price gains were reported for Avidbank Holdings, Inc., Bay Commercial Bank, California Bank of Commerce, CommerceWest Bank, Focus Business Bank, Mission Community Bancorp, Manhattan Bancorp, Mission Valley Bancorp, Presidio Bank, Plaza Bank, Redwood Capital Bancorp, Seacoast Commerce Bank, Santa Cruz County Bank, San Diego Private Bank, Summit State Bank, and Valley Commerce Bancorp. Price to Book CA Banks $250 $500 Mln Largest Price Gains Open Bank % Mission Community Bancorp +92.9% Seacoast Commerce Bank +77.8% Steepest Price Decline NCAL Bancorp 71.8% Carpenter & Company -8-

9 Industry Valuations BANKS BETWEEN $250 AND $500 MILLION (continued) The average price to tangible book value for this asset class equaled 1.18x in 2013, up signi icantly from the 0.87x average in Eighteen of the 23 banks were priced above tangible book value. Four of the remaining ive banks were valued within 11 basis points of tangible book value. The valuation for United American Bank was deemed to be not meaningful. The highest valuation was carried by Seacoast Commerce Bank at 2.03x, while the banks with the lowest meaningful P/TBV were tied at 0.89x for Bay Commercial Bank and NCAL Bancorp. The P/TBV ratio for this asset class rallied greatly from its 2009 cyclical low, increasing 82% through the end of Despite this recovery, the P/TBV ratio at the end of 2013 was still 55% below the peak ratio that had occurred in Only two banks in this group of 23 inancial institutions sustained losses for the last twelve months through September 30, 2013, notably NCAL Bancorp and United American Bank. LTM pro its at Seacoast Commerce Bank produced a P/E ratio in excess of 50x and, therefore, the ratio for that company was deemed to be not meaningful. The average P/E ratio for the remaining 30 companies averaged 17.88x at the end of 2013, compared to the 15.31x ratio in The P/E ratios ranged from 8.72x for Redwood Capital Bancorp to 36.85x for Presidio Bank. Trading activity for banks in the $250 $500 million class was more robust than for the two smaller asset classes. All 23 bank stocks traded in December, and all but two banks posted trades during the inal week of the year. The sum of all trades in 2013 for this class equaled 11.1 million shares for a per bank average trading volume of 480,884 shares or 156% more than the under $125 million bank group. The volume of trades ranged from 25,009 shares for Valley Republic Bank to 1.47 million shares for Summit State Bank. The market capitalization for this class equaled $898 million, up marginally from $830 million in The average per bank market capitalization equaled $39.0 million compared to $36.1 million in The relative stability of the year over year market capitalization comparison could be slightly misleading. The banks that grew out of this group reported aggregate market capitalization of $334 million, while the banks coming into this class had a total market capitalization of $196 million, or $138 million less than the exiting group. The range in market capitalization at the end of 2013 equaled a low of $1.3 million for NCAL Bancorp to a high of $60.3 million for CommerceWest Bank. Within this asset group, increases in market capitalization occurred for all of the banks, except Greater Sacramento Bancorp. The annual rise in market capitalization resulted from the steep increases stock prices that were experienced by the majority of these companies. In addition to the price driven increase in market capitalization, two banks generated merger related increases in share count and capital. San Diego Private Bank recognized merger related increases in capital of $16.2 million. Mission Bank reported a $3.5 million increase in capital as a result of its merger. Two other banks reported stock offering or conversions that added more than $1 million in capital, speci ically the $1.5 million capital increase for 1 st Capital and the $7.9 million offering by Avidbank. INDUSTRY VALUATIONS: BANKS BETWEEN $500 MILLION AND $1 BILLION The number of California banks with assets in the range of $500 million and $1 billion grew by three in the year ending December The three bank gain was achieved through the addition of six banks to this class and the elimination of three banks. Five banks joined this class from the $250 to $500 million class. One bank declined in assets to rejoin the group from the over $1 billion class. As the result of an acquisition, one bank grew above $1 billion in assets. Two banks from this class were acquired by larger banks. There was a carryover of 13 banks from the previous year. Carpenter & Company -9-

10 Industry Valuations BANKS BETWEEN $500 MILLION AND $1 BILLION (continued) Price to Book CA Banks $500 Mln $1 Bln Largest Price Gains Commonwealth Business Bank % Community West Bancshares +95.8% Plumas Bancorp +90.8% California First National Bancorp, Commonwealth Business Bank, 1 st Century Bancshares, Plumas Bancorp, and Security California Bancorp exceeded $500 million in assets by September 30, 2013 to join this asset class. Paci ic Mercantile Bancorp declined below $1 billion in assets to rejoin this class. Central Valley Community Bank, by virtue of its acquisition of the $200 million Visalia Community Bank, grew above $1 billion during Banc of California completed its acquisition of The Private Bank of California on July 1, This stock/cash transaction was valued at $52.0 million or 1.28x tangible book value. The Private Bank of California acquisition was in two phases. First, Beach Business Bank was merged into The Private Bank of California, and later The Private Bank of California was merged into Banc of California. Wilshire State Bank acquired the Korean American focused Saehan Bank in a cash/stock transaction valued at $105.0 million. The Wilshire Saehan deal was valued at 1.81x of tangible book value and closed on November 20, Of the 19 banks in the $500 million to $1 billion asset class, 18 experienced stock price gains, while one bank sustained a minimal price decline over the year. Sixteen of the 18 stock price gains were considered to be signi icant increases, that is in excess of 10%. The steepest stock price gain was the 139% advance for Commonwealth Business Bank. The price of Paci ic City Financial Corp. stock increased 122%. Double digit percentage increases in stock prices occurred for American River Bancshares, Bank of Commerce Holdings, California Republic Bank, Community West Bancshares, 1 st Century Bancshares, 1 st Enterprise Bank, FNB Bancorp, First Northern Community Bancorp, North Valley Bancorp, Oak Valley Bancorp, Plumas Bancorp, Security California Bancorp, Sunwest Bank, and United Security Bancshares. The number of banks trading above tangible book value increased to 13 by the end of A year earlier, the number of banks within this class with a price/tangible book value ratio over 1.0x was ive. In addition to the 13 banks trading above tangible book value, there were four banks within striking distance of 1.0x, with ratios ranging between 0.96x and 0.99x. The highest P/TBV was carried by California Republic Bank at 2.13x. This was the second consecutive year that California Republic Bank had the highest P/TBV for this asset class. The lowest P/TBV was for the thinly traded Sunwest Bank at 0.78x. The average P/TBV ratio for this asset category equaled 1.19x at the end of That ratio was up from the 0.97x average P/TBV at the end of Since the 2009 low in the ratio, the P/TBV average for this group recovered 92%. Nonetheless, P/TBV for this group was 57% below the 2004 peak ratio of 2.77x. Only one bank in this group recorded a loss for the last twelve months ending September 30, Therefore, out of the 19 banks, there was only one not meaningful P/E ratio at the end of The average price/ earnings ratio for this class equaled 14.74x, compared with the 14.19x P/E at the end of The lowest reported P/E was 5.31x for Paci ic City Financial Corp. The highest P/E was 40.23x for North Valley Bancorp. Carpenter & Company -10-

11 Industry Valuations BANKS BETWEEN $500 MILLION AND $1 BILLION (continued) The total number of shares traded in 2013 for the $500 million to $1 billion asset group equaled 33.3 million for an average volume per bank of 1.75 million shares. This average trading activity represented a 35% increase over the volume in Sunwest Bank, with its $33,000 average share price and its closely held ownership, reported the fewest number of shares traded at 198 shares for the entire year. In contrast, the largest number of shares traded occurred for Paci ic Mercantile Bancorp at 9.0 million shares. Within this asset class, eight of the 19 banks had trading volumes in excess of 1 million shares in The market capitalization of this class in 2013 totaled $1.6 billion, up from $988 million in Part of the 63% increase in total market capitalization was the addition over the year of three banks to this group. Nonetheless, the per bank market capitalization increased 37% to $84.6 million from $61.7 million in The lowest market capitalization was $29.7 million for Plumas Bancorp. The largest market capitalization was held by California First National Bancorp at $157.8 million, which was more than 4 times greater than Plumas Bancorp. Only Oak Valley Bancorp sustained a YoY reduction in market capitalization. INDUSTRY VALUATIONS: BANKS BETWEEN $1 AND $5 BILLION The number of banks in the $1 $5 billion asset class decreased by two in 2013 to 18. The two bank reduction matched the reduction in the size of this class that had occurred in There was considerable movement in this asset class. Central Valley Community Bank, through its acquisition of Visalia Community Bank, grew above $1 billion in assets. Farmers & Merchants Bank grew above $5 billion to join the next larger asset class. First California Financial Group was acquired by PacWest Bancorp. Paci ic Mercantile Bank dropped below $1 billion in assets to rejoin the smaller asset class. Seventeen banks carried over in this class from the prior year. All 18 banks in this class reported annual gains in stock prices. All but one bank reported double digit rates of increase in stock prices. The Farmers & Merchant Bancorp of Long Beach stock price increase of 3.0% was the smallest gain of the group. Wilshire Bancorp, Inc. experienced the steepest increase of 86%. Other stock price gains in excess of 50% were recorded by Hanmi Financial Corp., Paci ic Premier Bancorp, and Trico Bancshares. Only three banks in this group were valued below 1.0x price/tangible book value, notably Mechanics Bank, Exchange Bank, and River City Bank. Mechanics Bank with its 0.85x P/TBV carried the lowest ratio of the group. Westamerica Bancorp at 3.75x P/TBV had the highest valuation of the group and had the second highest ratio of all the publicly traded companies analyzed. Bridge Capital Holdings and Wilshire Bancorp, Inc. traded above 2.0x P/TBV. Price to Book CA Banks $1 $5 Billion Largest Price Gains Wilshire Bancorp +86.2% Trico Bancshares +69.4% Hanmi Financial Corp +61.1% Carpenter & Company -11-

12 Industry Valuations BANKS BETWEEN $1 AND $5 BILLION (continued) The average ratio of price to tangible book value for the entire class equaled 1.64x in 2013, up from 1.23x in The average price to tangible book value for this class ranked fourth highest of the eight asset classes analyzed. From its low in P/TBV in 2009, the ratio expanded 62% through year end All banks in this group reported pro its for the twelve months ending September All of the P/E ratios were meaningful statistics. The range in the price/earnings ratios for this class varied between 8.69x for Exchange Bank to 25.80x for Paci ic Premier Bancorp. The average ratio was 16.89x, a steep rise from the 12.21x ratio in The total volume of shares traded for this asset class equaled million shares, representing an average per company trading volume of 14.1 million shares. The 14.1 million shares per company trading volume matched the comparable statistic for Three stocks in the class, speci ically Farmers & Merchants Bancorp of Long Beach, Mechanics Bank, and River City Bank, were priced at or above $100 per share. For that reason, there was considerable variation in trading volumes between the companies in this group. Mechanics Bank, which closed 2013 at a price of $13,000 per share, had the lowest annual trading volume at 269 shares. In contrast, Wilshire Bancorp, Inc. recorded 93.5 million shares traded during This class of banks was active in the acquisition of inancial institutions. Seven of the 18 banks in this class announced and/or completed bank acquisitions, including the late January 2014 announcement by Trico Bancshares of its intention to acquire North Valley Bancorp. Bank of Marin Bancorp acquired the $243 million Bank of Alameda on November 29, Central Valley Community Bancorp acquired the $200 million Visalia Community Bank on July 1, Hanmi Financial Corp. announced on December 16, 2013 its intention to acquire the $1.6 billion Central Bank of Garland, Texas. Heritage Oaks Bancorp entered into a merger agreement on October 21, 2013 with the $447 million Mission Community Bank. Paci ic Premier Bancorp completed two acquisitions in 2013, speci ically the acquisitions of the $375 million First Associates Bank of Dallas, Texas, and the $242 million San Diego Trust Bank. Wilshire Bancorp, Inc. closed on its acquisition of the $542 million Saehan Bancorp on November 20, The market capitalization for the entire class equaled $6.5 billion, a 22% increase over 2012 s market capitalization of $5.4 billion. With two fewer banks than in 2012, the per bank market capitalization expanded 36% to $362.9 million, up from 2012 s average of $267.7 million. All of the banks in this category reported increases in market capitalization last year. Market capitalization for this group ranged from a low of $118.3 million for Exchange Bank to $1.5 billion for Westamerica Bancorp. The following banks reported stock conversion and/or capital acquisition in lows in excess of $1 million during the year ending September 30, 2013: American Business Bank, Bridge Capital Holdings, Bank of Marin Bancorp, CU Bancorp, and Preferred Bank. In addition, Central Valley Community Bancorp realized a $24 million increase to capital as a result of its acquisition of Visalia Community Bank. INDUSTRY VALUATIONS: BANKS BETWEEN $5 AND $10 BILLION At the end of 2013, the number of banks with assets, as of September 2013, between $5 and $10 billion equaled ive, a two bank increase over year end Farmers & Merchants Bank grew into this class from the under $5 billion group. The tracking report initiated coverage in 2013 of Capital Source, Inc. BBCN, CVB Financial Corp., and PacWest Bancorp were carry overs from the previous year. On July 22, 2013, PacWest Bancorp announced its intention to acquire $8.9 billion Capital Source, Inc. in a mixed transaction valued at $2.4 billion or 1.71x tangible book value. Additionally, PacWest closed on its acquisition of First California Financial Group on May 31, Carpenter & Company -12-

13 Industry Valuations BANKS BETWEEN $5 AND $10 BILLION (continued) Price to Book CA Banks $5 $10 Billion Largest Price Gains Capital Source, Inc % PacWest Bancorp +70.4% CVB Financial Corp +64.1% For the second consecutive year, all of the banks in the $5 to $10 billion range experienced annual stock price gains. In 2013, all ive banks reported stock price gains in excess of 20%. The steepest gain occurred for merger target Capital Source, Inc., up 90%. The second largest price increase was for the acquirer of Capital Source, notably PacWest Bancorp, which registered a 70% stock price gain. Four of the ive banks in this class traded above tangible book value. The exception was Farmers Merchants Bank at 0.91x tangible book value. The highest price/tangible book value ratio was carried by PacWest Bancorp at 3.35x. The group s average price to tangible book value equaled 2.14x, the second highest price to tangible book value of the eight classes analyzed, and was 94% above the recession s low ratio in The ive banks all reported pro its for the twelve months ending September 2013, and each bank had meaningful price/earnings ratios. The P/E ratios ranged from 11.3x for Farmers & Merchants Bank to 27.2x for PacWest Bancorp. The average price/earnings ratio for this group equaled 18.47x, the second highest P/E of the eight classes and was up from the 15.72x ratio at the end of The combined annual trading volume for the ive banks equaled million shares in 2013, producing an average share volume per bank of million shares. Farmers & Merchants Bank, with its $5,226 price per share, reported the fewest shares traded in 2013 at 4,417. In contrast, Capital Source, Inc. experienced an annual trading volume of million shares. The total market capitalization for banks between $5 and 410 billion equaled $8.6 billion, producing a perbank market capitalization of $1.7 billion, compared with $973 million in 2012,. The per bank market capitalization increased 76% last year. All of the banks reported a step up in market capitalization. The lowest market capitalization was $684 million for Farmers & Merchants Bank, while Capital Source had the highest market capitalization at $2.8 billion. Capital Source, BBCN Bancorp, and PacWest Bancorp experienced additions to capital that exceeded $1 million during the year ending September 30, INDUSTRY VALUATIONS: BANKS BETWEEN $10 AND $100 BILLION The number and composition of the California publicly traded banks with assets between $10 and $100 billion held steady, as of year end All ive banks reported signi icant gains in stock prices during 2013, with the price advances ranging from 37% to 87%. The steepest increase occurred for SVB Financial Group, while Cathay General Bancorp had the lowest percentage gain in stock prices. The rise in stock prices for City National Corp, East West Bancorp, and First Republic Bank were all around the narrow range of 60% to 63%. Carpenter & Company -13-

14 Industry Valuations BANKS BETWEEN $10 AND $100 BILLION (continued) Price to Book CA Banks $10 $100 Billion Largest Price Gains SVB Financial Group +87.4% East West Bancorp +62.7% City National Corp +60.0% All of the banks were priced above tangible book value, with four of the banks valued over 2.30x tangible book value. The lowest ratio was the 1.90x for Cathay General Bancorp, while East West Bancorp, Inc. had the highest P/TBV at 2.50x. The average price to tangible book value for banks between $10 and $100 billion equaled 2.34x, the highest ratio of the eight asset classes studied. The 2013 price to TBV average ratio compared to 1.55x in 2012 and represented a 59% increase over the 2009 cyclical low in the ratio. Despite the run up in the ratio during 2013, the P/TBV for this class of banks remained 6.0% below its 2006 rate. All ive banks reported meaningful price/earnings ratios based upon the last twelve month earnings through September 30, The P/E for the entire group averaged 19.42x in 2013, up from 13.59x in This was the highest ratio of the eight classes analyzed. The range in price/earnings ratios was relatively narrow between 16.67x for First Republic Bank and 23.10x for SVB Financial Group. This class of banks had signi icant stock market liquidity and active stock trading. The total annual number of shares traded for this class equaled million shares, down 4.9% from the million share volume in The per bank average shares traded in 2013 was million shares, down from the 2012 average of million shares. The only stocks trading above the class average volume were East West Bancorp and First Republic Bank. The lowest trading volume was 65.4 million shares for SVB Financial. First Republic reported the largest volume of trades at million shares. The total market capitalization for the $10 $100 billion asset category in 2013 equaled $23.0 billion, compared to the 2012 market capitalization of $14.0 billion. On a per institution basis, the average market capitalization in 2013 equaled $4.6 billion, up from $2.8 billion in The 2013 growth in market capitalization equaled 64%. All of the banks reported increased market capitalization for the past year. The highest market capitalization was held by First Republic at $6.9 billion. First Republic held the largest market capitalization of all of 137 stocks in the tracking report. Cathay General had the lowest market capitalization at $2.1 billion. All of the banks in this class, except for City National Corp., reported additions or conversions to corporate stock that exceeded $1 million for the year ending September 30, Industry Valuations: California Thrifts The number and composition of publicly traded California thrifts held steady in This class of inancial institutions remained constant at six. The only change in this class was the name change from First PacTrust to Banc of California. Based upon September 2013 data, thrifts ranged in size from $345 million to $3.7 billion. Broadway Financial Corp was at the low end of the assets, while Banc of California, especially after its recent Carpenter & Company -14-

15 Industry Valuations CALIFORNIA THRIFTS (continued) Price to Book CA Thrifts Largest Price Gains BOFI Holdings Inc % Broadway Financial +40.8% acquisitions of three commercial banks, ranked as the largest publicly traded thrift in California with $3.7 billion in September 2013 assets. BOFI Holdings also exceeded $3.0 billion in assets. Five of the six thrifts experienced YoY stock price gains in Only Provident Financial Holdings, Inc. reported a decline in stock price for the year. The largest annual advance in stock prices was the 182% increase in the stock price of BOFI Holdings, Inc. Other notable increases were the gains of 41% for Broadway Financial Corp. and the 14% rise in the stock price of Malaga Financial Corp. BOFI Holdings, Inc. reported the highest price to tangible book ratio of all of the stocks analyzed in this report. The P/TBV for BOFI Holdings, Inc. climbed to 3.90x in 2013 from 1.70x in Also trading above tangible book value were Banc of California at 1.29x and Malaga Financial Corp at 1.19x. The ratios for Broadway Financial Corp. and Provident Financial Holdings were deemed to be not meaningful. The average price to tangible book value ratio for the entire class equaled 1.83x, a steep increase from the 2008 low and brought the thrift P/TBV to its highest ratio since Five of the six thrifts reported pro its for the last twelve months ending September The P/E ratio for Banc of California exceeded 50x, causing the ratio be considered not meaningful. Broadway Financial Corp. sustained a loss in LTM earnings. The resultant four meaningful P/E ratios produced a 16.45x average, up from 12.75x in The P/E ratios ranged from 8.72x for Provident Financial Corp. to 25.55x for BOFI Holdings. As a result of the wide differential in the asset size of the California thrifts, there was a signi icant variation in the market capitalization within the group. Broadway Financial Corp. carried a market capitalization of $18.1 million. BOFI Holdings reported the largest market capitalization of any thrift at $1.1 billion, which was a 200% increase over its 2012 market capitalization. Total market capitalization of California thrifts climbed from $931 million in 2012 to $1.8 billion at the end of This 89% increase in total market capitalization was primarily due to the steep increases in market capitalization at BOFI and Banc of California. Provident Financial Holdings and Simplicity reported reductions in the levels of their market capitalization over the past year. The total trading volume in 2013 for thrifts equaled 87.8 million shares for a per institution average of 14.6 million shares traded. The 2013 trading volume was up 132% over The highest annual trading volume was for BOFI Holdings at 42.9 million shares, an 186% pick up from The lowest volumes were the 276,342 shares traded for Malaga Financial. Carpenter & Company -15-

16 Industry Valuations CALIFORNIA FINANCIAL INSTITUTIONS CLOSED IN 2013 (Sorted by asset size of seller) Institution Name City Inactive Date Total Assets ($000) Traded* Outcome First California Bank Westlake Village 1 Jun 13 1,741,192 yes Acquired by PacWest Bancorp at 1.709x TBV The Private Bank of California Los Angeles 11 Oct 13 1,065,164 no Merged into Banc of California The Private Bank of California Los Angeles 1 Jul ,622 yes Saehan Bank Los Angeles 21 Nov ,998 yes Acquired by FirstPacTrust Bancorp at 1.279x TBV and merged with Beach Business Bank Acquired by Wilshire Bancorp at 1.805x TBV Regents Bank, N.A. La Jolla 20 Sep ,550 no Merged into Grandpoint Capital, Inc. Centennial Bank Fountain Valley 1 May ,292 no Bank of Alameda Alameda 30 Nov ,640 yes Commerce National Bank Newport Beach 1 Oct ,834 yes San Diego Trust Bank San Diego 26 Jun ,898 yes Visalia Community Bank Visalia 1 Jul ,465 yes Acquired out of bankruptcy by Western Alliance Bancorp at 0.66x TBV Acquired by Bank of Marin Bancorp at 1.233x TBV Acquired by Sterling Financial Corp. at 1.425x TBV Acquired by Pacific Premier Bancorp at 1.210x TBV Acquired by Central Valley Community Bancorp at 1.236x TBV Los Angeles National Bank Buena Park 17 May ,793 no Acquired by RBB Bancorp Gilmore Bank Los Angeles 26 Sep ,102 no Acquired by Grandpoint Capital, Inc. Borrego Springs Bank, N.A. La Mesa 1 Mar ,708 no Acquired by Sterling Financial Corp. at 0.507x TBV San Diego Private Bank La Jolla 3 Apr ,262 no Merged with Coronado First Bank Mojave Desert Bank, N.A. Mojave 25 Jan ,504 yes Acquired by Mission Bancorp at 0.824x TBV Evergreen International Bank Long Beach 2 Jan 13 22,473 no Voluntarily liquidated charter * Traded: yes means publicly traded and no means privately held TBV= Tangible book value Carpenter & Company -16-

17 Industry Valuations Merger Announcements and/or Completions in 2013/2014 Deal Announce Seller Deal Completed Buyer Seller Value P/TBV Buyer/Target Date City Status Date Assets ($000) ($000) (x) Bank of Marin Bancorp/ NorCal Community Bancorp 7/1/2013 Alameda Completion 11/29/2013 1,427, , Bay Commercial Bank/ Bank On It, Inc. 1/16/2014 Stockton Pending 327, , Central Valley Community Bancorp/ Visalia Community Bank 12/20/2012 Visalia Completion 7/1/ , , Coronado First Bank/ San Diego Private Bank 11/27/2012 La Jolla Completion 4/2/ , , First California Financial Group, Inc./ Premier Service Bank 2/28/2012 Riverside Termination 1/30/2013 1,876, , First PacTrust Bancorp, Inc./ Private Bank of California 8/22/2012 Los Angeles Completion 7/1/2013 1,115, , Grandpoint Capital, Inc./ California Community Bank 1/19/2012 Escondido Completion 11/30/2012 1,179, , Grandpoint Capital, Inc./ Gilmore Bank 7/2/2013 Los Angeles Completion 9/26/2013 2,188, ,922 NA NA Grandpoint Capital, Inc./ NCAL Bancorp 6/11/2012 Los Angeles Termination 1/28/2013 1,551, ,894 NA NA Heritage Oaks Bancorp/ Mission Community Bancorp 10/21/2013 San Luis Obispo Pending 1,096, , Independence Bank/ Premier Service Bank 11/4/2013 Riverside Pending 311, , Mission Bancorp/ Mojave Desert Bank, N.A. 7/24/2012 Mojave Completion 1/24/ , , Pacific Premier Bancorp, Inc./ San Diego Trust Bank 3/6/2013 San Diego Completion 6/24/2013 1,173, , PacWest Bancorp/ CapitalSource Inc. 7/22/2013 Los Angeles Pending 5,299,905 8,482,677 2, PacWest Bancorp/ First California Financial Group, Inc. 11/6/2012 Westlake Village Completion 5/31/2013 5,538,502 1,990, Private investor Mr. Richard Tan/ California Business Bank 1/23/2013 Los Angeles Completion 7/19/2013 NA 57,910 NA NA Private Investor Mr. Tieming Chen/ Orient Bancorporation 10/1/2012 San Francisco Completion 2/8/2013 NA 544,102 NA NA Private investor/ NCAL Bancorp 9/16/2013 Los Angeles Pending NA 377,977 NA NA Private investors/ First National Bank of Southern California 12/10/2013 Riverside Pending NA 144,480 NA NA RBB Bancorp/ Los Angeles National Bank 1/8/2013 Buena Park Completion 5/17/ , ,942 NA NA Sterling Financial Corporation/ American Heritage Holdings 10/22/2012 La Mesa Completion 2/28/2013 9,599, , Sterling Financial Corporation/ Commerce National Bank 5/2/2013 Newport Beach Completion 10/1/2013 9,256, , TriCo Bancshares/ North Valley Bancorp 1/21/2014 Redding Pending 2,632, , Western Alliance Bancorporation/ Centennial Bank 1/22/2013 Fountain Valley Completion 4/30/2013 7,403, , Wilshire Bancorp, Inc./ Saehan Bancorp 7/15/2013 Los Angeles Completion 11/20/2013 2,756, , Carpenter & Company -17-

18 STOCK PERFORMANCE: 2013 Annual Report Carpenter and Company Stock Performance Report Average LTM P/E Ratios by Asset Group Average LTM* P/E Ratio 12/31/2013 revious Mon 12/31/2012 Change Mon % Change YTD Total Assets: Under $125M % 1.74% $125M - $250M % -6.14% $250M - $500M % 16.75% $500M - $1Bn % 3.87% $1Bn - $5Bn % 38.35% $5Bn - $10Bn % 17.48% Over $10Bn % 42.96% CA Thrifts % 29.06% Under $125M $125M - $250M $250M - $500M $500M - $1Bn $1Bn - $5Bn $5Bn - $10Bn Over $10Bn CA Thrifts 12/31/ /31/2013 *LTM= Last Twelve Months. LTM P/E calculated based on last twelve months earnings through 9/30/2013. Information is gathered from sources believed to be reliable, however, the accuracy of the data cannot be guaranteed. Carpenter & Company -18-

19 STOCK PERFORMANCE Carpenter and Company Stock Performance Report Price/Book Ratios by Asset Group Average Price/T. Book Ratio 12/31/2013 Previous Month 12/31/2012 Change Month % Change YTD Total Assets: Under $125M % 8.61% $125M - $250M % 12.38% $250M - $500M % 34.72% $500M - $1Bn % 22.65% $1Bn - $5Bn % 33.07% $5Bn - $10Bn % 32.02% Over $10Bn % 50.52% CA Thrifts % 74.14% Under $125M $125M - $250M $250M - $500M $500M - $1Bn $1Bn - $5Bn $5Bn - $10Bn Over $10Bn CA Thrifts 12/31/ /31/2013 Information is gathered from sources believed to be reliable, however, the accuracy of the data cannot be guaranteed. Carpenter & Company -19-

20 STOCK PERFORMANCE Carpenter and Company Stock Performance Report Industry-wide Ratio Comparisons Carpenter California Banks - SNL Bank Index: Price/Tangible Book Ratio (x) 12/31/2013 Previous Month 12/31/2012 California Banks SNL Banks ifornia BaNL Bank California Banks SNL Banks Total Assets: Less than $250M Less than $500M $250M - $500M $500M - $1Bn $1Bn - $5Bn $5Bn - $10Bn Over $10Bn Thrifts /31/2013 Comparison 0.00 Less than $250M Less than $500M $250M - $500M $500M - $1Bn $1Bn - $5Bn $5Bn - $10Bn Over $10Bn Thrifts California Banks SNL Banks Carpenter California Banks - SNL Bank Index: Price/LTM EPS Ratio (x) 12/31/2013 Previous Month 12/31/2012 California Banks SNL Banks ifornia BaNL Bank California Banks SNL Banks Total Assets: Less than $250M NA Less than $500M $250M - $500M $500M - $1Bn $1Bn - $5Bn $5Bn - $10Bn Over $10Bn Thrifts /31/2013 Comparison 0.00 Less than $250M Less than $500M $250M - $500M $500M - $1Bn $1Bn - $5Bn $5Bn - $10Bn Over $10Bn Thrifts California Banks SNL Banks Information is gathered from sources believed to be reliable, however, the accuracy of the data cannot be guaranteed. Carpenter & Company -20-