Pacific Continental Corporation Reports Fourth-Quarter and Full-Year 2011 Results

EUGENE, Ore., Jan. 24, 2012/PRNewswire/ -- Pacific Continental Corporation (Nasdaq: PCBK), the holding company of Pacific Continental Bank, today reported financial results for the fourth quarter and full year 2011.

Recent highlights:

• Fiscal year 2011 net income up 4.9% over prior year.
• Reductions in nonperforming and classified assets continue.
• Commercial loans expand 12.2% year-to-date.
• Announced increase in fourth quarter 2011 cash dividend to shareholders.
• Total risk-based capital ratio of 19.22%, significantly above the 10.0% minimum for "well-capitalized" designation.
• Recognized once again as one of Oregon's most admired companies in the Portland Business Journal's annual Most Admired Companies Survey.
• Funded a $5 millionSBA guaranteed loan in the Portlandmarket, the highest-dollar loan guaranteed and approved by the U.S. Small Business Administration's PortlandDistrict.

Net Income
For the full year 2011, net income was $5.3 million, up 4.9% over 2010. Earnings per diluted share for 2011 were $0.29compared to $0.28in 2010. Return on average assets and return on average tangible equity for 2011 were 0.44% and 3.45% and were similar to 2010 results of 0.43% and 3.44%, respectively.

For the fourth quarter 2011, the Company recorded a net loss of $852 thousandor $0.05per share that compares unfavorably with 2010 fourth quarter net income of $1.2 millionor $0.06per diluted share. The fourth-quarter loss results primarily from increased loan loss provisioning and other real estate owned valuation impairments required upon receipt of appraisals on two isolated properties described more fully in the December 12, 2011, press release.

"We have achieved two consecutive years of profitability, and we are beginning to see increased lending activities as evidenced by the more than 12 percent growth in commercial loans," said Hal Brown, chief executive officer. "Despite the fourth quarter earnings setback, I am encouraged by the improvement in balance sheet fundamentals in what is still a very difficult economic environment," added Brown.

Classified assets, provisioning and loan statistics
Classified assets continued a six-quarter trend of decline, and at December 31, 2011, totaled $68.5 million, a decrease of $12.5 millionfrom the end of the prior quarter and down $41.3 million, or 38% from December 31, 2010. Nonperforming assets, a subcategory of classified assets, totaled $37.1 millionat December 31, 2011, or 2.92% of total assets, a decrease from 2010 year-end and 2011 third-quarter-end ratios of 3.82% and 3.56%, respectively.

Loans past-due 30-89 days (excluding nonaccrual loans) were 0.41% of total loans at December 31, 2011, down from 0.59% at the end of the third quarter 2011 and 0.77% at the end of 2010. This is the tenth consecutive quarter in which this ratio was near or below one percent, a trend that suggests stabilization in the migration of problem loans.

"Concerted efforts to significantly reduce classified and problem assets were successful in 2011 and will continue into 2012," said Roger Busse, president and chief operating officer. "This success now allows for talented bankers to shift more attention to additional business development and growth initiatives while we continue driving problem loan reductions," added Busse.

The Company's 2011 provision for loan losses totaled $12.9 milliondown from $15.0 millionin 2010. During the fourth quarter 2011, the provision totaled $7.0 million, compared to $3.3 millionof a year ago and $1.8 millionfor the third quarter 2011. The significant increase in the fourth quarter 2011 provision for loan losses is primarily related to a single loan secured by industrial zoned bare land. Previous appraisals of the subject land indicated sufficient collateral value; however, a December appraisal noted significant deterioration in value when compared to the prior appraisal performed in late 2010. As a result of the new appraised value, the Company recorded a charge-off of $5.2 millionon the collateral-dependent loan during the fourth quarter 2011.

The allowance for loan losses as a percentage of outstanding loans at December 31, 2011, was 1.82%, compared to 1.93% at December 31, 2010.

Commercial loan activity strengthens
Outstanding gross loans at December 31, 2011, were $820.8 million, down $7.7 millionfrom the end of third quarter 2011 and down $36.1 millionfrom one year ago, reflecting contraction in the construction and real estate portfolios. For the year, construction loans contracted $19.8 millionand real estate loans contracted an additional $44.4 million. During the fourth quarter, the bank received a payoff of $10.1 millionon a single non-owner occupied commercial real estate loan which otherwise masked fourth quarter growth in outstanding loans.

Commercial loans increased $14.7 millionduring the fourth quarter 2011 and were up $29.6 millionor 12.2% over December 31, 2010, outstanding loans. This growth continues to validate the Company's business model and focused strategy on meeting the credit needs of community-based businesses, nonprofit organizations, health care and professional service providers. Loans to health care professionals and dentists, in particular, have continued to grow. Dental practice loans now represent 25.4% of the total loan portfolio and continue to perform very well.

Core deposit growth slows
Company-defined core deposits continue to grow but at a slower pace than in previous quarters. Period-end core deposits grew by $5.1 millionfrom the end of third quarter 2011 while average core deposits for the quarter declined by $14.6 million. For the full year 2011, core deposits averaged $879.8 million, an increase of $52.7 millionor 6.4% from the average core deposits for 2010. At period-end, noninterest-bearing demand deposits totaled $278.6 millionand represent 31.4% of core deposits.

"We are beginning to see increased activity and subsequent volatility in larger depositor balances," said Hal Brown. "This would seem consistent with increased economic activity as commercial customers gain confidence and begin to employ otherwise idle funds," added Brown.

Capital levels
The Company's capital ratios continue to be well above the minimum FDIC well-capitalized designated levels. At December 31, 2011, the Company's Tier 1 leverage ratio, Tier 1 risk-based capital ratio, and Total risk-based capital ratio were 13.09%, 17.97% and 19.22% as compared to 13.38%, 15.86% and 17.10% at December 31, 2010. The FDIC's minimum well-capitalized designation ratios are 5.00%, 6.00% and 10.00%, respectively.

Net interest margin
For the full year 2011, the net interest margin averaged 4.61%, a decline of 12 basis points from the 4.73% reported for 2010. The contraction in the loan portfolio and concurrent growth in the lower yielding securities portfolio contributed to the year-over-year decline in the net interest margin. For 2011 the securities portfolio grew by $92.6 millionand at year-end represents 27% of total assets versus 21% of total assets one year ago.

The net interest margin for the fourth quarter 2011 was 4.59%, up 3 basis points from the 4.56% margin reported for third quarter 2011, and down 4 basis points from the 4.63% margin reported for fourth quarter 2010. The linked-quarter improvement in the net interest margin was primarily attributable to a lower cost of funds. The cost of interest-bearing funds fell 22 basis points during the quarter while the yield on average earning assets declined 11 basis points. The net interest margin for the current period and all prior periods has been adjusted to a tax-equivalent basis using a 35% tax rate.

Noninterest income and expense
Full-year noninterest income was $5.9 millionup from $4.6 millionin 2010. Excluding gains on sales of securities and impairment charges on investment securities, 2011 noninterest income was flat with 2010, with increases in merchant bankcard activity offset by declines in mortgage revenues. Noninterest income for the fourth quarter 2011 was down $173 thousandfrom the same quarter last year. Most of this difference is attributable to one-time revenues recorded during the fourth quarter 2010. On a linked-quarter basis, and excluding gains on the sale of securities in both quarters and a $140 thousandrental income benefit recorded in the third quarter, fourth quarter 2011 noninterest income was relatively flat compared with third quarter 2011. During the fourth quarter 2011, the Company made an investment of $15 millionin bank-owned life insurance ("BOLI") that is expected to add $125 to $150 thousandper quarter to noninterest income in 2012.

Noninterest expense in fourth quarter 2011 was up $996 thousandover fourth quarter 2010, and up $860 thousandon a linked-quarter basis. The linked-quarter increase was primarily attributable to foreclosed property expense that totaled $1.2 millionin the fourth quarter 2011. Approximately $977 thousandof the other real estate expense was valuation write downs on various properties the largest of which was $640 thousandand related to a single undeveloped commercial property previously announced in the December 12, 2011, press release. For the full year 2011, noninterest expense was up $4.0 millionor 12.0%. Expenses related to problem assets, specifically, legal fees, repossession and collection expense, and other real estate expense accounted for $2.3 millionof the total increase in expenses for the year.

Conference call and audio webcast:
Management will conduct a live conference call and audio webcast for interested parties relating to the Company's results for the fourth quarter 2011 on Wednesday, January 25, 2012, at 11:00 a.m. Pacific Time/ 2:00 p.m. Eastern Time. To listen to the conference call, interested parties should call [phone]. The webcast will be available via Pacific Continental's website (). To listen to the live audio webcast, click on the webcast presentation link on the Company's home page a few minutes before the presentation is scheduled to begin. An audio webcast replay is typically available within twenty-four hours following the live webcast and will be archived for one year on the Pacific Continental website. Any questions regarding the conference call presentation or webcast should be directed to Maecey Castle, vice president and director of corporate communications, at [phone].

About Pacific Continental Bank
Pacific Continental Bank, the operating subsidiary of Pacific Continental Corporation, delivers highly personalized services through fourteen banking offices in Oregonand Washington. The Bank also operates a loan production office in Tacoma, Washington. Pacific Continental, with $1.3 billionin assets, has established one of the most unique and attractive metropolitan branch networks in the Pacific Northwest with offices in three of the region's largest markets including Seattle, Portlandand Eugene. Pacific Continental targets the banking needs of community-based businesses, health care professionals, professional service providers and nonprofit organizations.

Since its founding in 1972, Pacific Continental Bank has been honored with numerous awards and recognitions from highly regarded third-party organizations including The Seattle Times, the Portland Business Journal and Oregon Business magazine. A complete list of the company's awards and recognitions - as well as supplementary information about Pacific Continental Bank - can be found online at . Pacific Continental Corporation's shares are listed on the Nasdaq Global Select Market under the symbol "PCBK" and are a component of the Russell 2000 Index.

Forward-Looking Statement Safe Harbor
This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 ("PSLRA"). Such forward-looking statements include but are not limited to statements about future suggested problem loan migration, and are subject to risks and uncertainties that may cause actual results to differ materially from those projected, including but not limited to the following: the high concentration of loans of the company's banking subsidiary in commercial and residential real estate lending; adverse economic trends in the United Statesand the markets we serve affecting the Bank's borrower base; a continued decline in the housing and real estate market; a continued increase in unemployment or sustained high levels of unemployment; continued erosion or sustained low levels of consumer confidence; changes in the regulatory environment and increases in associated costs, particularly ongoing compliance expenses and resource allocation needs; vendor quality and efficiency; the company's ability to control risks associated with rapidly changing technology both from an internal perspective as well as for external providers; increased competition among financial institutions; fluctuating interest rate environments; a tightening of available credit and other risks and uncertainties discussed in the sections titled "Risk Factors", "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations", as applicable, from Pacific Continental's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Readers are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date on which they are made and reflect management's current estimates, projections, expectations and beliefs. Pacific Continental Corporation undertakes no obligation to publicly revise or update the forward-looking statements to reflect events or circumstances that arise after the date of this release. This statement is included for the express purpose of invoking PSLRA's safe harbor provisions.

PACIFIC CONTINENTAL CORPORATION
Consolidated Income Statements
(In thousands, except share and per share amounts)
(Unaudited)
		Three months ended				Twelve months ended
		December 31,		December 31,		December 31,		December 31,
		2011		2010		2011		2010
Interest and dividend income
Loans		$          12,606		$          13,577		$          50,753		$          56,810
Securities		2,315		1,867		9,025		6,612
Federal funds sold & interest-bearing deposits with banks		1		5		6		11
		14,922		15,449		59,784		63,433
Interest expense
Deposits		1,218		2,224		6,544		9,293
Federal Home Loan Bank & Federal Reserve borrowings		481		538		1,894		2,325
Junior subordinated debentures		37		116		136		510
Federal funds purchased		9		5		41		44
		1,745		2,883		8,615		12,172
Net interest income		13,177		12,566		51,169		51,261
Provision for loan losses		7,000		3,250		12,900		15,000
Net interest income after provision for loan losses		6,177		9,316		38,269		36,261
Noninterest income
Service charges on deposit accounts		487		464		1,816		1,711
Other fee income, principally bankcard		368		427		1,576		1,505
Loan servicing fees		24		30		106		94
Mortgage banking income		67		125		191		270
Bank-owned life insurance income		38		-		38		-
Gain on sale of investment securities		59		-		884		45
Impairment losses on investment securities (OTTI)		(10)		-		(10)		(226)
Other noninterest income		284		444		1,265		1,250
		1,317		1,490		5,866		4,649
Noninterest expense
Salaries and employee benefits		4,738		4,603		18,875		17,657
Premises and equipment		839		882		3,444		3,462
Bankcard processing		146		170		618		594
Business development		390		342		1,521		1,273
FDIC insurance assessment		424		667		1,692		2,143
Other real estate expense		1,161		413		3,307		1,316
Other noninterest expense		2,086		1,711		7,619		6,649
		9,784		8,788		37,076		33,094
Income before provision for income taxes		(2,290)		2,018		7,059		7,816
Provision for income taxes		(1,438)		827		1,718		2,724
Net income		$              (852)		$            1,191		$            5,341		$            5,092
Earnings per share:
Basic		$             (0.05)		$              0.06		$              0.29		$              0.28
Diluted		$             (0.05)		$              0.06		$              0.29		$              0.28
Weighted average shares outstanding:
Basic		18,434,519		18,405,939		18,427,657		18,399,245
Common stock equivalents
attributable to stock-based awards		-		11,741		91,890		13,284
Diluted		18,434,519		18,417,680		18,519,547		18,412,529
PERFORMANCE RATIOS
Return on average assets		-0.27%		0.39%		0.44%		0.43%
Return on average equity (book)		-1.86%		2.73%		3.01%		2.98%
Return on average equity (tangible) (1)		-2.12%		3.13%		3.45%		3.44%
Net interest margin (2)		4.59%		4.63%		4.61%		4.73%
Efficiency ratio (3)		67.50%		62.52%		65.01%		59.19%
(1) Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions.
(2) Net interest margin is reported on a tax-equivalent yield basis at a 35% tax rate.
(3) Efficiency ratio is noninterest expense divided by operating revenues.  Operating revenues are net interest
income plus noninterest income.

PACIFIC CONTINENTAL CORPORATION
Consolidated Balance Sheets
(In thousands, except share amounts)
(Unaudited)
		December 31,		December 31,
		2011		2010
ASSETS
Cash and due from banks		$          19,807		$          25,424
Interest-bearing deposits with banks		52		267
Total cash and cash equivalents		19,859		25,691
Securities available-for-sale		346,542		253,907
Loans held-for-sale		1,058		2,116
Loans, less allowance for loan losses and net deferred fees		805,211		839,815
Interest receivable		4,725		4,371
Federal Home Loan Bank stock		10,652		10,652
Property and equipment, net of accumulated depreciation		20,177		20,883
Goodwill and intangible assets		22,235		22,458
Deferred tax asset		7,308		10,188
Taxes receivable		1,671		-
Other real estate owned		11,000		14,293
Prepaid FDIC assessment		2,782		4,387
Bank-owned life insurance		15,038		-
Other assets		1,974		1,415
Total assets		$     1,270,232		$     1,210,176
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Noninterest-bearing demand		$        278,576		$        234,331
Savings and interest-bearing checking		545,856		574,333
Time $100,000 and over		72,436		63,504
Other time		68,386		86,791
Total deposits		965,254		958,959
Federal funds and overnight funds purchased		12,300		-
Federal Home Loan Bank borrowings		101,500		67,000
Junior subordinated debentures		8,248		8,248
Accrued interest and other payables		4,064		3,731
Total liabilities		1,091,366		1,037,938
Shareholders' equity
Common stock, shares authorized:  50,000,000
shares issued and outstanding:  18,435,084 at
December 31, 2011 and 18,415,132 at December 31, 2010		137,844		137,062
Retained earnings		37,468		33,969
Accumulated other comprehensive income		3,554		1,207
		178,866		172,238
Total liabilities and shareholders' equity		$     1,270,232		$     1,210,176
CAPITAL RATIOS
Total capital (to risk weighted assets)		19.22%		17.10%
Tier I capital (to risk weighted assets)		17.97%		15.86%
Tier I capital (to leverage assets)		13.09%		13.38%
Tangible common equity (to tangible assets)(1)		12.55%		12.61%
Tangible common equity (to risk-weighted assets)(1)		17.47%		15.18%
OTHER FINANCIAL DATA
Shares outstanding at end of period		18,435,084		18,415,132
Tangible shareholders' equity(1)		$         156,631		$         149,780
Book value per share		$               9.70		$               9.35
Tangible book value per share		$               8.50		$               8.13
(1) Tangible shareholders' equity excludes goodwill and core deposit intangible assets related to
acquisitions.

PACIFIC CONTINENTAL CORPORATION
Loans by Type and Allowance for Loan Losses
(In thousands)
(Unaudited)
		December 31,
		2011				2010
		Dollars		Percent		Dollars		Percent
LOANS BY TYPE
Real estate secured loans:
Permanent loans:
Multifamily residential		$          51,897		6.3%		$          57,850		6.8%
Residential 1-4 family		61,717		7.5%		76,692		8.9%
Owner-occupied commercial		207,008		25.2%		201,286		23.5%
Nonowner-occupied commercial		139,581		17.0%		163,071		19.0%
Other loans secured by real estate		18,263		2.2%		23,950		2.8%
Total permanent real estate loans		478,466		58.3%		522,849		61.0%
Construction loans:
Multifamily residential		2,574		0.3%		6,192		0.7%
Residential 1-4 family		17,960		2.2%		22,683		2.6%
Commercial real estate		10,901		1.3%		11,730		1.4%
Commercial bare land and acquisition & development		19,496		2.4%		25,587		3.0%
Residential bare land and acquisition & development		12,707		1.5%		17,263		2.0%
Total construction real estate loans		63,638		7.8%		83,455		9.7%
Total real estate loans		542,104		66.0%		606,304		70.7%
Commercial loans		272,600		33.2%		243,034		28.4%
Consumer loans		4,569		0.6%		5,900		0.7%
Other loans		1,556		0.2%		1,730		0.2%
Gross loans		820,829		100.0%		856,968		100.0%
Deferred loan origination fees		(677)				(583)
		820,152				856,385
Allowance for loan losses		(14,941)				(16,570)
		$        805,211				$        839,815
Real estate loans held-for-sale		$            1,058				$            2,116
		Three months ended				Twelve months ended
		December 31,		December 31,		December 31,		December 31,
ALLOWANCE FOR LOAN LOSSES		2011		2010		2011		2010
Balance at beginning of period		$          15,287		$          17,769		$          16,570		$          13,367
Provision for loan losses		7,000		3,250		12,900		15,000
Loan charge offs		(7,720)		(5,325)		(15,805)		(15,514)
Loan recoveries		374		876		1,276		3,717
Net charge offs		(7,346)		(4,449)		(14,529)		(11,797)
Balance at end of period		$          14,941		$          16,570		$          14,941		$          16,570

PACIFIC CONTINENTAL CORPORATION
Selected Other Financial Information and Ratios
(In thousands)
(Unaudited)
		Three months ended				Twelve months ended
		December 31,				December 31,
		2011		2010		2011		2010
BALANCE SHEET AVERAGES
Loans(1)		$        825,988		$        868,044		$        833,643		$        905,245
Allowance for loan losses		(15,250)		(19,278)		(15,728)		(17,651)
Loans, net of allowance		810,738		848,766		817,915		887,594
Securities and short-term deposits		341,563		234,405		304,620		199,083
Earning assets		1,152,301		1,083,171		1,122,535		1,086,677
Noninterest-earning assets		105,416		113,863		104,180		102,612
Assets		$     1,257,717		$     1,197,034		$     1,226,715		$     1,189,289
Interest-bearing core deposits(2)		$        597,550		$        640,777		$        615,864		$        610,928
Noninterest-bearing core deposits(2)		275,212		229,526		263,915		216,154
Core deposits(2)		872,762		870,303		879,779		827,082
Noncore interest-bearing deposits		73,988		68,663		65,408		77,087
Deposits		946,750		938,966		945,187		904,169
Borrowings		124,775		80,077		100,653		111,623
Other noninterest-bearing liabilities		4,616		4,671		3,619		2,739
Liabilities		1,076,141		1,023,714		1,049,459		1,018,531
Shareholders' equity (book)		181,576		173,320		177,256		170,758
Liabilities and equity		$     1,257,717		$     1,197,034		$     1,226,715		$     1,189,289
Shareholders' equity (tangible)(3)		$        159,313		$        150,834		$        154,908		$        148,187
SELECTED MARKET DATA
Eugene market gross loans, period end		$        250,345		$        257,562
Portland market gross loans, period end		406,316		404,965
Seattle market gross loans, period end		164,168		194,441
Total gross loans, period end		$        820,829		$        856,968
Eugene market core deposits, period end(2)		$        526,928		$        538,011
Portland market core deposits, period end(2)		237,230		239,991
Seattle market core deposits, period end(2)		121,685		117,836
Total core deposits, period end(2)		885,843		895,838
Other deposits, period end		79,411		63,121
Total		$        965,254		$        958,959
Eugene market core deposits, average(2)		$        509,882		$        525,937		$        510,324		$        510,366
Portland market core deposits, average(2)		239,459		225,769		247,309		199,341
Seattle market core deposits, average(2)		123,421		118,597		122,146		117,375
Total core deposits, average(2)		872,762		870,303		879,779		827,082
Other deposits, average		73,988		68,663		65,408		77,087
Total		$        946,750		$        938,966		$        945,187		$        904,169
NET INTEREST MARGIN RECONCILIATION
Yield on average loans		6.17%		6.35%		6.21%		6.40%
Yield on average securities(4)		2.88%		3.31%		3.14%		3.42%
Yield on average earning assets(4)		5.19%		5.69%		5.37%		5.85%
Rate on average interest-bearing core deposits		0.58%		1.15%		0.86%		1.28%
Rate on average interest-bearing non-core deposits		1.81%		2.13%		1.91%		1.89%
Rate on average interest-bearing deposits		0.72%		1.24%		0.96%		1.35%
Rate on average borrowings		1.68%		3.26%		2.06%		2.58%
Cost of interest-bearing funds		0.87%		1.45%		1.10%		1.52%
Interest rate spread(4)		4.32%		4.24%		4.27%		4.33%
Net interest margin(4)		4.59%		4.63%		4.61%		4.73%
(1) Includes loans held-for sale.
(2) Core deposits include all demand, savings, and interest checking accounts plus all local time deposits including local
time deposits in excess of $100.
(3) Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions.
(4) Tax-exempt income has been adjusted to a tax-equivalent basis at a 35% tax rate.  The amount of such adjustment was
an addition to recorded income of approximately $162 thousand and $83 thousand for the three months ended
December 31, 2011 and 2010, respectively and $529 thousand and $176 thousand for the twelve months ended December 31. 2011 and 2010, respectively.

					PACIFIC CONTINENTAL CORPORATION
					Nonperforming Assets and Asset Quality Ratios
					(In thousands)
					(Unaudited)
							December 31,		December 31,
							2011		2010
			NONPERFORMING ASSETS
Non-accrual loans
	Real estate secured loans:
		Permanent loans:
			Multifamily residential				$                    -		$            1,010
			Residential 1-4 family				3,426		6,123
			Owner-occupied commercial				5,138		1,622
			Nonowner-occupied commercial				525		8,428
			Other loans secured by real estate				50		538
				Total permanent real estate loans			9,139		17,721
		Construction loans:
			Multifamily residential				-		1,985
			Residential 1-4 family				757		2,493
			Commercial real estate				933		1,671
			Commercial bare land and acquisition & development				7,837		91
			Residential bare land and acquisition & development				1,929		1,032
			Other				-		-
				Total construction real estate loans			11,456		7,272
					Total real estate loans		20,595		24,993
	Commercial loans						5,999		8,033
	Consumer loans						-		-
	Other loans						-		-
						Total nonaccrual loans	26,594		33,026
90-days past due and accruing interest							-		-
	Total nonperforming loans						26,594		33,026
		Nonperforming loans guaranteed by government					(495)		(1,056)
			Net nonperforming loans				26,099		31,970
Other real estate owned							11,000		14,293
			Total nonperforming assets, net of guaranteed loans				$          37,099		$          46,263
			ASSET QUALITY RATIOS
				Allowance for loan losses as a percentage of total loans
					outstanding		1.82%		1.93%
				Allowance for loan losses as a percentage of total
					nonperforming loans, net of government guarantees		57.25%		51.83%
				Net loan charge offs (recoveries) as a percentage of
					average loans, annualized		1.74%		1.30%
				Net nonperforming loans as a percentage of total loans			3.18%		3.73%
				Nonperforming assets as a percentage of total assets			2.92%		3.82%
				Consolidated classified asset ratio(1)			38.91%		63.39%
				Past due as a percentage of total loans			0.41%		0.77%

(1) Classified asset ratio is defined as the sum of all loan-related contingent liabilities and loans internally      graded substandard or worse, impaired loans (net of government guarantees), adversely classified securities,      and other real estate owned, divided by total consolidated Tier 1 capital plus the allowance forloan losses. (2) Defined as loans past due more than 30 days and still accruing interest, as a percentage of total loans, net of deferred fees.

PACIFIC CONTINENTAL CORPORATION
Nonperforming Loan Rollforward
(In thousands)
(Unaudited)
				Balance at September 30, 2011		Additions to Non-performing		Reclassification		Net Paydowns		Returns to Performing		Charge-offs		Transfers to OREO		Balance at December 31, 2011
Real estate loans
	Multifamily residential			$                               -		$                -		$                 -		$                -		$                -		$                -		$                    -		$                               -
	Residential 1-4 family			3,393		802		-		(504)		-		(182)		(83)		3,426
	Owner-occupied commercial			4,704		1,189		-		(28)		(127)		(383)		(217)		5,138
	Nonowner-occupied commercial			1,191		36		-		-		-		(458)		(244)		525
	Other real estate loans			122		-		-		(14)		-		(58)		-		50
		Total real estate loans		9,410		2,027		-		(546)		(127)		(1,081)		(544)		9,139
Construction
Multifamily residential				-		-		-		-		-		-		-		-
Residential 1-4 family				1,596		-		-		(639)		-		(150)		(50)		757
Commercial real estate				1,500		-		-		-		-		(567)		-		933
Commercial bare land and acquisition & development				13,027		-		-		-		-		(5,190)		-		7,837
Residential bare land and acquisition & development				1,451		729		-		(233)		-		(18)		-		1,929
	Total  construction loans			17,574		729		-		(872)		-		(5,925)		(50)		11,456
Commercial and other				6,732		-		-		(352)		-		(381)		-		5,999
Consumer				-		-		-		-		-				-		-
Total				$                       33,716		$           2,756		$                 -		$         (1,770)		$            (127)		$         (7,387)		$                (594)		$                       26,594
				Balance at December 31, 2010		Additions to Non-performing		Reclassification		Net Paydowns		Returns to Performing		Charge-offs		Transfers to OREO		Balance at December 31, 2011
Real estate loans
	Multifamily residential			$                         1,010		$              250		$                 -		$         (1,186)		$                -		$              (74)		$                    -		$                               -
	Residential 1-4 family			6,123		5,522		-		(3,142)		-		(1,789)		(3,288)		3,426
	Owner-occupied commercial			1,622		5,010		-		(443)		(127)		(407)		(517)		5,138
	Nonowner-occupied commercial			8,428		35		-		(1,271)		-		(1,723)		(4,944)		525
	Other real estate loans			538		1,340		(499)		(881)		-		(448)		-		50
		Total real estate loans		17,721		12,157		(499)		(6,923)		(127)		(4,441)		(8,749)		9,139
Construction
Multifamily residential				1,985		-		-		(1,985)		-		-		-		-
Residential 1-4 family				2,493		797		-		(1,689)		-		(600)		(244)		757
Commercial real estate				1,671		-		-		-		-		(738)		-		933
Commercial bare land and acquisition & development				91		13,027		-		-		-		(5,281)		-		7,837
Residential bare land and acquisition & development				1,032		3,048		-		(484)		-		(1,631)		(36)		1,929
	Total  construction loans			7,272		16,872		-		(4,158)		-		(8,250)		(280)		11,456
Commercial and other				8,033		1,424		499		(2,449)		(461)		(1,047)		-		5,999
Consumer				-		11		-		-		-		(11)		-		-
Total				$                       33,026		$         30,464		$                 -		$       (13,530)		$            (588)		$       (13,749)		$             (9,029)		$                       26,594

PACIFIC CONTINENTAL CORPORATION

Other Real Estate Owned Rollforward

(In thousands)

PACIFIC CONTINENTAL CORPORATION
Aged Analysis of Loans Receivable (Unaudited)
(In thousands)
As of December 31, 2011
								Greater Than 90 Days Still Accruing
				30-59 Days Past Due Still Accruing		60-89 Days Past Due Still Accruing
										Nonaccrual		Total Past Due and Nonaccrual		Total Current		Total Loans Receivable
Real estate loans
Multifamily residential				$                -		$                -		$                -		$                -		$                -		$      51,897		$              51,897
Residential 1-4 family				251		210		-		3,426		3,887		57,830		61,717
Owner-occupied commercial				151		190		-		5,138		5,479		201,529		207,008
Nonowner-occupied commercial				-		-		-		525		525		139,056		139,581
Other real estate loans				-		-		-		50		50		18,213		18,263
Total real estate loans				402		400		-		9,139		9,941		468,525		478,466
Construction
Multifamily residential				-		-		-		-		-		2,574		2,574
Residential 1-4 family				67		-		-		757		824		17,136		17,960
Commercial real estate				1,635		-		-		933		2,568		8,333		10,901
Commercial bare land and acquisition & development				-		-		-		7,837		7,837		11,659		19,496
Residential bare land and acquisition & development				52		175		-		1,929		2,156		10,551		12,707
Total  construction loans				1,754		175		-		11,456		13,385		50,253		63,638
Commercial and other				634		-		-		5,999		6,633		267,523		274,156
Consumer				-		-		-		-		-		4,569		4,569
Totals				$          2,790		$             575		$                -		$        26,594		$        29,959		$    790,870		$            820,829
PACIFIC CONTINENTAL CORPORATION
Aged Analysis of Loans Receivable (Unaudited)
(In thousands)
As of December 31, 2010
								Greater Than 90 Days Still Accruing
				30-59 Days Past Due Still Accruing		60-89 Days Past Due Still Accruing
										Nonaccrual		Total Past Due andNonaccrual		Total Current		Total Financing Receivables
Real estate loans
Multifamily residential				$          2,549		$                -		$                -		$          1,010		$          3,559		$      54,291		$              57,850
Residential 1-4 family				110		366		-		6,123		6,599		70,093		76,692
Owner-occupied commercial				2,694		356		-		1,622		4,672		196,614		201,286
Nonowner-occupied commercial				-		-		-		8,428		8,428		154,643		163,071
Other real estate loans				195		-		-		538		733		23,217		23,950
Total real estate loans				5,548		722		-		17,721		23,991		498,858		522,849
Construction
Multifamily residential				-		-		-		1,985		1,985		4,207		6,192
Residential 1-4 family				-		-		-		2,493		2,493		20,190		22,683
Commercial real estate				-		-		-		1,671		1,671		10,059		11,730
Commercial bare land and acquisition & development				-		-		-		91		91		25,496		25,587
Residential bare land and acquisition & development				175		-		-		1,032		1,207		16,056		17,263
Total construction loans				175		-		-		7,272		7,447		76,008		83,455
Commercial and other				102		32		-		8,033		8,167		236,597		244,764
Consumer				7		5		-		-		12		5,888		5,900
Total				$          5,832		$             759		$                -		$        33,026		$        39,617		$    817,351		$            856,968

PACIFIC CONTINENTAL CORPORATION
Credit Quality Indicators (Unaudited)
(In thousands)
As of December 31, 2011
			Loan Grade
			Pass		Special Mention		Substandard		Doubtful		Totals
Real estate loans
Multifamily residential			$            50,547		$                    -		$              1,350		$                    -		$            51,897
Residential 1-4 family			51,622		-		10,095		-		61,717
Owner-occupied commercial			194,250		-		11,143		1,615		207,008
Nonowner-occupied commercial			137,438		-		2,143		-		139,581
Other real estate loans			17,367				896		-		18,263
Total real estate loans			451,224		-		25,627		1,615		478,466
Construction
Multifamily residential			2,574		-		-		-		2,574
Residential 1-4 family			14,036		-		3,924		-		17,960
Commercial real estate			7,075		-		3,826		-		10,901
Commercial bare land and acquisition & development			11,000		-		8,496		-		19,496
Residential bare land and acquisition & development			9,929		-		2,778		-		12,707
Total  construction loans			44,614		-		19,024		-		63,638
Commercial and other			264,415		-		9,663		78		274,156
Consumer			4,486		-		83		-		4,569
Totals			$          764,739		$                    -		$            54,397		$              1,693		$          820,829
PACIFIC CONTINENTAL CORPORATION
Credit Quality Indicators (Unaudited)
(In thousands)
As of December 31, 2010
			Loan Grade
			Pass
					Special Mention		Substandard		Doubtful		Totals
Real estate loans
Multifamily residential			$            55,105		$                    -		$              2,745		$                    -		$            57,850
Residential 1-4 family			60,544		-		15,658		490		76,692
Owner-occupied commercial			185,362		-		14,274		1,650		201,286
Nonowner-occupied commercial			153,088		-		9,983		-		163,071
Other real estate loans			20,343		-		3,607		-		23,950
Total real estate loans			474,442		-		46,267		2,140		522,849
Construction
Multifamily residential			4,206		-		1,986		-		6,192
Residential 1-4 family			19,532		-		3,151		-		22,683
Commercial real estate			7,114		-		4,616		-		11,730
Commercial bare land and acquisition & development			11,771		-		13,816		-		25,587
Residential bare land and acquisition & development			11,886		-		5,377		-		17,263
Total  construction loans			54,509		-		28,946		-		83,455
Commercial and other			231,358		-		13,406		-		244,764
Consumer			5,860		-		-		40		5,900
Totals			$          766,169		$                    -		$            88,619		$              2,180		$          856,968

SOURCE Pacific Continental Corporation