CFNB SECOND QUARTER EARNINGS DOWN 34% IN ABSENCE OF
INVESTMENT GAINS AND ON LOWER LOAN INCOME

IRVINE, CALIFORNIA, January 26, 2012 -- California First National Bancorp (NASDAQ: CFNB; "CalFirst Bancorp") today announced net earnings of $2.1 million for the second quarter ended December 31, 2011, a decline of 34% from net earnings of $3.1 million for the second quarter of fiscal 2011. For the six months ended December 31, 2011, net earnings were down just 5% to $4.5 million from $4.8 million for the first six months of fiscal 2011. Diluted earnings per share in the second quarter of $0.20 were down 34% from $0.30 from the second quarter of fiscal 2011, while diluted earnings per share of $0.44 for the first six months of fiscal 2012 were down 5% from $0.46 per share for the same period of fiscal 2011.

The decline in net earnings from the second quarter and first six months of fiscal 2011 is largely due to large gains realized on the sale of investment securities during the prior year periods. Excluding investment gains from both periods, gross profit during second quarter declined by 6%, while gross profit for the first six months of fiscal 2012 is up 10% from the prior year.

Gross profit of $6.4 million for the second quarter ended December 31, 2011 declined from the second quarter of the prior year by $1.6 million, or 20%. Total direct finance, loan and interest income for the second quarter of fiscal 2012 decreased 9% to $5.9 million from $6.5 million during the second quarter of the prior year. A $662,000, or 39%, decline in commercial loan income accounted for the decrease and was due to a 14% decrease in average loan balances and a 196 basis point decline in average yield. Interest expense paid on deposits and borrowings during the second quarter of fiscal 2012 decreased by $57,000, or 7%, reflecting a 34 basis point drop in average interest rates paid offset by a 21% increase in average balances. For the second quarter of fiscal 2012, the Company did not record a provision for credit losses, compared to a $500,000 provision during the second quarter of fiscal 2011. The lack of provision in 2012 is due to a 9% decline in the commercial loan portfolio from $93.7 million at June 30, 2011 to $85.0 million at December 31, 2011, along with some improvement in credit metrics. All of these factors led to a $60,000, or 1%, decrease in net direct finance and interest income after provision for credit losses to $5.1 million.

Total non-interest income of $1.3 million for the second quarter of fiscal 2012 was down 54% from $2.8 million for the same period of the prior year. Included in non-interest income during the second quarter of fiscal 2012 was $56,000 of gains realized on retirement of a security, while fiscal 2011 included investment gains of $1.2 million. Excluding such investment gains, other non-interest income of $1.2 million declined from $1.6 million during the second quarter of the prior year primarily due to lower income realized from the re-lease of property on leases reaching the end of term during the period.

For the six months ended December 31, 2011, gross profit of $13.5 million was 1% below $13.7 million for the same period of the prior year. Total direct finance, loan and interest income for the first six months of fiscal 2012 decreased 3% to $12.0 million due to an $872,000 decrease in commercial loan income that was offset only partly by a $423,000 increase in direct finance income. During the first six months of fiscal 2012, the average investment in commercial loans fell 3% to $87.3 million, while the average investment in leases increased 15% to $228.8 million, and the average yield on leases and loans held in the Company's own portfolio decreased by 92 basis points to 6.58%. The average yield on cash and investments decreased 43 basis points to 2.04% for the six months ended December 31, 2011, while average balances increased 25% to $161 million. For the six months ended December 31, 2011, interest expense on deposits and borrowings decreased by $98,000 to $1.7 million, reflecting a 36 basis point decrease in average rates paid on average balances that increased by 23% to $279.1 million. For the first six months of fiscal 2012, the Company did not record a provision for credit losses, compared to a provision of $775,000 in fiscal 2011. The large provision during the first six months of fiscal 2011 was largely due to significant growth in the commercial loan portfolio to $108.3 million at December 31, 2010, which has since been reduced to $85.0 million at December 31, 2011.

Total non-interest income of $3.2 million for the first six months of fiscal 2012 was down 17% from $3.8 million during the comparable period of fiscal 2011. Fiscal 2011 non-interest income included $1.4 million of gains realized on the sale of investment securities while the first six months of fiscal 2012 included investment gains of $56,000. Excluding such investment gains, other non-interest income for the six months ended December 31, 2011 was $3.1 million, up 30% from $2.4 million for the first six months of the prior year. This increase in other income was largely due to higher income realized from the sale or re-lease of property on leases reaching the end of term during the period.