Dollar Bank Deposit Secrecy Law

MetroCorp Bancshares, Inc. Announces 2013 First Quarter Results.

Net Income of $3.0 Million – 9.4% Improvement Over 2012

EPS

 of $0.16 per
Diluted
  
tr.v. di·lut·ed, di·lut·ing, di·lutes
1. To make thinner or less concentrated by adding a liquid such as water.

2. To lessen the force, strength, purity, or brilliance of, especially by admixture.
 Share.

Nonperforming Assets Declined.

HOUSTON
 city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837.
Economy

The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry;
, April 19, 2013 /PRNewswire/ — MetroCorp Bancshares, Inc.
(Nasdaq:
MCBI

), a Texas corporation, which provides community banking
services through its subsidiaries, MetroBank, N.A., serving Texas, and

Metro

 United Bank, serving
California
 , most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W).
, today announced the operating
results for the first quarter of 2013.

(Logo: http://photos.prnewswire.com/prnh/20110119/MM32884LOGO)

Financial Highlights

* Net income of $3.0 million for the first quarter of 2013 improved
9.4% from $2.8 million for the first quarter of 2012.

* As a result of the TARP
preferred stock

 repurchased in 2012, net
income available to common shareholders of $3.0 million for the first
quarter of 2013 increased 39.5% from $2.2 million for the first quarter
of 2012.

* Earnings per diluted share for the first quarter of 2013 was $0.16
(on 18.7 million diluted shares) compared with $0.16 (on 13.3 million
diluted shares) for first quarter of 2012.

* Total loans grew $24.4 million to $1.12 billion at March 31, 2013
compared with $1.10 billion at
December
 see month.
 31, 2012.

* Total nonperforming assets (“NPA”) at March 31, 2013
declined $7.8 million or 18.7% on a linked quarter basis to $33.8
million compared with $41.5 million at December 31, 2012, or declined
$23.7 million or 41.2% compared with $57.4 million at March 31,
2012.

* Subsequent to March 31, 2013, NPA was further reduced by an
additional $6.3 million.

* The ratio of nonperforming assets to total assets declined to
2.13% at March 31, 2013 compared with 2.73% at December 31, 2012, and
3.83% at March 31, 2012.

* Net charge-offs of $1.3 million for the first quarter of 2013 were
0.12% of total loans, compared with $60,000 for fourth quarter 2012, and
$655,000 for the first quarter of 2012.

* Provision for loan losses was a
reversal
 n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its
 of ($450,000) for first
quarter 2013 compared with a reversal of ($890,000) for fourth quarter
2012, and a provision of $400,000 for first quarter 2012.

* The ratio of the allowance for loan losses to total loans at March
31, 2013 was 2.03% compared with 2.23% at December 31, 2012 and 2.68% at
March 31, 2012.

* Net interest margin was 3.61% for the first quarter of 2013
compared with 3.78% for the fourth quarter of 2012, and 3.93% for the
first quarter of 2012.

* Total
risk-based capital ratio

 was 17.75% at March 31, 2013
compared with 17.95% at December 31, 2012.

George M. Lee, Co-Chairman, President and
CEO

 of MetroCorp
Bancshares, Inc. stated, “Management is pleased with and encouraged
by the Company’s first quarter 2013 performance. Key financial
trends and results in terms of earnings, asset quality, loan growth and
capital ratios improved overall as compared with the fourth quarter of
2012 and the first quarter of 2012. As reported in the preceding
“Financial Highlights” section above, the Company has made
meaningful progress in all areas of performance. We have met and in some
cases exceeded our objectives, especially with respect to asset quality
improvement.

“NPA declined $7.8 million during the first quarter 2013, and
the ratio of NPA to total assets declined to 2.13% as of March 31, 2013,
closing in on the 2% target we previously set for the fourth quarter
2013. Moreover, subsequent to March 31, 2013, management was very
pleased to complete two other major NPA transactions and further reduce
NPA by $6.3 million. These two subsequent reductions of nonaccrual loans
included a payoff of a $4.9 million loan and a note sale of $1.4
million. With the additional reductions, the Company’s NPA to total
assets ratio would be below our 2% target.

“Loan growth of $24.4 million (8.9% on an
annualized

Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared.
 basis)
between the quarters ending December 31, 2012 and March 31, 2013 was on
pace with management’s target of annualized high single
digit

 growth. Barring any unforeseen macro economic crisis, the Company
expects the same encouraging trend to continue. We are looking forward
to a new era of growth and progress.”

Interest income and expense Net interest income for the three months
ended March 31, 2013 was $12.8 million, a decrease of $822,000 or 6.0%
compared with $13.6 million for the same period in 2012, primarily due
to a decline in the yield on loans, partially offset by lower cost and
volume of deposits. On a linked-quarter basis, net interest income
decreased $480,000 compared with the three months ended December 31,
2012.

The net interest margin for the three months ended March 31, 2013
was 3.61%, a decrease of 32 basis points compared with 3.93% for the
same period in 2012. The yield on average
earning assets

 decreased 50
basis points, and the cost of average earning assets decreased 18 basis
points for the same periods. On a linked-quarter basis, the net interest
margin for the three months ended March 31, 2013 decreased 17 basis
points compared with 3.78% for the three months ended December 31, 2012.
The yield on average earning assets decreased 18 basis points, and the
cost of average earning assets decreased one basis point compared with
the yields at December 31, 2012.

Interest income for the three months ended March 31, 2013 was $15.0
million, down $1.4 million or 8.4% compared with $16.4 million for the
same period in 2012, primarily due to lower yield on loans and
securities, partially offset by an increase in the volume of loans.
Average earning assets increased $44.5 million or 3.2% to $1.44 billion
for the first quarter of 2013, compared with $1.40 billion for the same
period in 2012. Average total loans increased $46.7 million or 4.5% to
$1.10 billion for the first quarter of 2013 compared with $1.05 billion
for the first quarter of 2012. The yield on average earning assets for
the first quarter of 2013 was 4.23% compared with 4.73% for the first
quarter of 2012.

Interest expense for the three months ended March 31, 2013 was $2.2
million, down $559,000 or 20.3% compared with $2.8 million for the same
period in 2012, primarily due to lower cost on savings, money market and
time deposit accounts. Average
interest-bearing

 deposits were $974.5
million for the first quarter of 2013, a decrease of $26.4 million or
2.6% compared with $1.00 billion for the same period of 2012. The cost
of interest-bearing deposits for the first quarter of 2013 was 0.68%
compared with 0.87% for the first quarter of 2012. Average other
borrowings, excluding junior
subordinated

 debentures, were $28.8 million
for the first quarter of 2013, an increase of $2.8 million or 10.9%
compared with $26.0 million for the first quarter of 2012. The cost of
other borrowings for the first quarter of 2013 was 3.28% compared with
3.82% for the first quarter of 2012.

Noninterest income and expense Noninterest income for the three
months ended March 31, 2013 was $1.7 million, a decrease of $153,000 or
8.5% compared with $1.8 million for the same period in 2012. The
decrease for the three months ended March 31, 2013 was primarily due to
a decline in service fees.

Noninterest expense for the three months ended March 31, 2013 was
$10.3 million, a decrease of $631,000 or 5.8% compared with $10.9
million for the same period in 2012. The decrease was mainly the result
of $974,000 in net gains on sales of ORE properties as well as a decline
in ORE expenses, but partially offset by increases in other noninterest
expense and salaries and employee benefits. Other noninterest expense
increased primarily due to an increase in
data processing
 or  operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a
 expenses as a
result of a core processing system conversion, and increases in the
provision for unfunded commitments and operational losses.

Salaries and employee benefits expense for the three months ended
March 31, 2013 was $6.3 million, an increase of $371,000 or 6.3%
compared with $5.9 million for the same period in 2012. The increase was
primarily due to increased
headcount
 or head·count
n.
1. The act of counting people in a particular group.

2. The number of people counted in this way.

Noun 1.
 and share-based compensation
costs.

Provision for loan losses The following table summarizes the
provision for loan losses and net charge-offs as of and for the quarters
indicated:

The (reduction in) provision for loan losses for the three months
ended March 31, 2013 was a reversal of ($450,000), a decrease of
$850,000 compared with a provision of $400,000 for the same period in
2012, primarily as a result of a reduction in nonperforming and
classified assets.

Net charge-offs for the three months ended March 31, 2013 were $1.3
million or 0.12% of total loans compared with net charge-offs of
$655,000 or 0.06% of total loans for the same period in 2012. The net
charge-offs for the first quarter of 2013 consisted of $921,000 in loans
from Texas and $389,000 in loans from California.

Asset Quality The following table summarizes nonperforming assets as
of the dates indicated:

Total nonperforming assets at March 31, 2013 were $33.8 million
($25.9 million from Texas and $7.9 million from California) compared
with $41.5 million at December 31, 2012 ($32.5 million from Texas and
$9.0 million from California), a decrease of $7.8 million or 18.7%. The
ratio of total nonperforming assets to total assets decreased to 2.13%
at March 31, 2013 from 2.73% at December 31, 2012. The decrease in
nonperforming assets in Texas consisted primarily of declines of $5.7
million in nonaccrual loans, $871,000 in nonaccrual troubled debt
restructurings (“TDRs”), and a net reduction of $64,000 in
ORE. In Texas, nonaccrual loans including nonaccrual TDRs decreased
primarily due to a $6.7 million loan transfer to ORE and $1.0 million in
charge-offs, but partially offset by the addition of three loans
totaling
approximately
  
adj.
1. Almost exact or correct:

2.
 $878,000. The decrease in nonperforming assets in
California primarily consisted of decreases of $354,000 in nonaccrual
loans, $400,000 in accruing TDRs, $45,000 in nonaccrual TDRs and
$340,000 in ORE.

ORE at March 31, 2013 decreased $403,000 compared with December 31,
2012, which included a net reduction of $64,000 in Texas and $340,000 in
California. The decrease in Texas was primarily the result of a $6.7
million loan transferred to ORE but was subsequently sold during first
quarter 2013, and writedowns of two other properties. The decrease in
California was primarily the result of the sale of two properties.

Approximately $21.5 million or 99.3% of nonaccrual loans and
nonaccruing TDRs at March 31, 2013, are collateralized by real estate.
Management is closely monitoring the loan portfolio and actively working
on problem loan resolutions; however, uncertain economic conditions
could further impact the loan portfolio.

Management conference call. On
Monday
 see week.
, April 22, 2013, the Company
will hold a conference call at 10:00 a.m. Central (11:00 a.m. Eastern)
to discuss the first quarter 2013 results. A brief management
presentation will be followed by a question and answer period. To
participate by phone, U.S. callers may dial 1.877.407.8291(International
callers may dial 1.201.689.8345) and ask for the MetroCorp conference.
The call will be webcast by Shareholder.com and can be accessed at
MetroCorp’s web site at www.metrobank-na.com. An audio
archive

 of
the call will be available approximately one hour after the call and
will be accessible at www.metrobank-na.com in the
Investor Relations

 section.

MetroCorp Bancshares, Inc. provides a full range of commercial and
consumer banking services through its wholly owned subsidiaries,
MetroBank, N.A. and Metro United Bank. The Company has thirteen
full-service banking locations in the greater Houston and
Dallas, Texas
 or
 metropolitan areas, and six full service banking locations in the
greater
San Diego
 , city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay.
,
Los Angeles
 , city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850.
 and
San Francisco, California
 
 metropolitan areas. As of March 31, 2013, the Company had
consolidated
  
v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates

v.tr.
1. To unite into one system or whole; combine:
 assets of $1.6 billion. For more information, visit the Company’s
web site at www.metrobank-na.com.

The statements contained in this release that are not historical
facts may constitute forward-looking statements within the meaning of
the
Private Securities Litigation Reform Act

 of 1995. Forward-looking
statements describe the Company’s future plans, projections,
strategies and expectations, are based on assumptions and involve a
number of risks and uncertainties, many of which are beyond the
Company’s control. Important factors that could cause actual
results to differ materially from the results anticipated or projected
include, but are not limited to, the following: (1) general business and
economic conditions in the markets the Company serves may be less

favorable
  
adj.
1. Advantageous; helpful:

2. Encouraging; propitious:

3.
 than expected which could decrease the demand for loan,
deposit and other
financial services

 and increase loan delinquencies and
defaults; (2) changes in the interest rate environment which could
reduce the Company’s net interest margin or result in increased
loan
prepayments

; (3) the failure of or changes in management’s
assumptions regarding the adequacy of the allowance for loan losses; (4)
an adverse change in the real estate market in the Company’s
primary market areas; (5) increased credit risk in the Company’s
assets and increased
operating risk

 caused by a material change in
commercial, consumer and/or real estate loans as a percentage of the
total loan portfolio; (6) increased asset levels and changes in the
composition of assets and the resulting impact on the Company’s
capital levels and
regulatory
  
tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates
1. To control or direct according to rule, principle, or law.

2.
 capital ratios; (7) legislative or
regulatory developments including changes in laws concerning taxes,
banking, securities, insurance and other aspects of the financial
services industry, or possible noncompliance and enforcement action with
the
Bank Secrecy Act

 and other anti-money laundering
statues

 and
regulations; (8) the effect of compliance, or failure to comply within
stated deadlines, with the provisions of the Formal Agreement between
MetroBank and the
Office of the Comptroller of the Currency

; (9)
increases in the level of nonperforming assets; (10) changes in the
availability of funds which could increase costs or decrease liquidity
or
impair
  
tr.v. im·paired, im·pair·ing, im·pairs
To cause to diminish, as in strength, value, or quality:
 the Company’s ability to raise additional capital; (11)
the effects of competition from other financial institutions operating
in the Company’s market areas and elsewhere, including institutions
operating locally, regionally, nationally and internationally, together
with such competitors offering banking products and services by mail,
telephone, computer and the
Internet

; (12) changes in accounting
principles, policies or
guidelines

n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks.
; (13) a
deterioration

n.
The process or condition of becoming worse.
 or
downgrade

 in
the credit quality and credit agency ratings of the securities in the
Company’s securities portfolio; (14) the
incurrence

n. 1. The act of incurring, bringing on, or subjecting one’s self to (something troublesome or burdensome); as, the  of guilt, debt, responsibility, etc. s>

Noun 1.
 and possible

impairment

 of goodwill associated with an acquisition; (15) the timing,
impact and other uncertainties of the Company’s ability to enter
new markets successfully and
capitalize on
   

v. t. 1. To turn (an opportunity) to one’s advantage; to take advantage of (a situation); to profit from; as, to  an opponent’s mistakes s>.
 growth opportunities; (16)
the inability to fully realize the Company’s net deferred tax
asset; (17) the Company’s ability to adapt successfully to
technological changes to meet customers’ needs and developments in
the marketplace, or potential interruptions or breaches in security of
the Company’s information systems; (18) potential environmental
risk and associated cost on the Company’s foreclosed real estate
assets; and (19) the loss of senior management or operating personnel
and the potential inability to hire qualified personnel at reasonable
compensation levels. All written or oral forward-looking statements are
expressly qualified in their entirety by these cautionary statements.
These and other risks and factors are further described from time to
time in the Company’s 2012 Annual Report on Form 10-K and other
reports and other documents filed with the Securities and Exchange
Commission.

For more information contact: MetroCorp Bancshares, Inc., Houston
George Lee, Executive Vice Chairman, President & CEO, (713)
776-3876, or David
Choi

, Executive Vice President&
CFO

, (713)
776-3876

SOURCE MetroCorp Bancshares, Inc.