Birmingham Bloomfield Bancshares - FORM 8-K - EX-99.1 - PRESS RELEASE, DATED JULY 24, 2012

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EXHIBIT 99.1

LOGO

Birmingham Bloomfield Bancshares, Inc.

33583 Woodward Avenue

Birmingham, MI 48009

248-723-7200

July 24, 2012

Birmingham Bloomfield Bancshares, Inc.

Announces increase in pre-tax income and loan growth for the period ended June 30, 2012

BIRMINGHAM, MI—Birmingham Bloomfield Bancshares, Inc. (OTC Bulletin Board: BBBI.OB) (“the Company”), the holding company for Bank of Birmingham, today announced unaudited results for the quarter and six month periods ended June 30, 2012. The performance generated an increase in pre-tax earnings and produced growth in portfolio loans.

The Company reported net income of $208,000 or $0.11 per common share for the second quarter of 2012 compared to net income of $261,000 or $0.15 per common share for the same period of 2011. Net income for the six month period ended June 30, 2012 was $544,000 or $0.30 per common share compared to $676,000 or $0.38 per common share for the same period last year. The overall performance was impacted by the recognition of income tax expense in 2012 not required in 2011. Excluding tax expense of $111,000 and $283,000 for the three and six month periods, pre-tax net income before preferred dividends was $341,000 and 860,000, respectively, this represents an increase of 10.1% and 11.4% relative to the comparable periods of 2011.

Chief Executive Officer, Rob Farr, issued the results and commented, “We continue to see positive improvements in the core operations of the Bank and the results for the first six months of 2012 represent a record profit for the Company on a pre-tax basis. We have been able to successfully grow the institution with quality loan opportunities and improve the profitability of the balance sheet. Our net interest margin was 4.91% for the quarter and total assets reached $139.9 million, an increase of 12.4% from December 31, 2011. The results demonstrate the earnings capacity of the Bank and our focus on increasing franchise value for our shareholders. We are optimistic about the remainder of 2012 and are excited about the future possibilities for the organization.”

Results of Operation

The Company reported net interest income of $1.496 million for the second quarter of 2012, a 19.6% increase relative to the same quarter of 2011 and a 7.3% increase compared to the most recent linked quarter. The improvement was the result of portfolio loan growth and a reduction in the average cost of deposits. Net interest margin for the quarter was 4.91%, the highest

quarterly margin reported by the Company. This was achieved by improving the earning asset mix and lowering funding costs. Net interest income for the first six months of 2012 increased 15.1% to $2.889 million compared to the same period of 2011. Net interest margin for the year to date period ended June 30, 2012 was 4.86% compared to 4.50% in 2011.

Revenue from non-interest income sources continues to positively impact operating results. Total non-interest income for the three and six month periods ended June 30, 2012 was $112,000 and $596,000, respectively. Relative to 2011, total non-interest income declined for both reportable periods as a result of lower SBA loan volume but the impact of the lost revenue was offset by an increase in earnings on residential mortgages sold in the secondary market, additional ancillary fee income and a gain from the sale of a bank owned property. The additional Mortgage Banking income was the result of increased volume in sales of qualified residential loans due to the favorable interest rate environment.

Total non-interest expense for the second quarter of 2012 was $1.216 million, compared to $1.207 million for the second quarter of 2011 and $1.338 million for the first quarter of 2012. Year to date non-interest expense for 2012 was $2.555 million, an increase of $265,000 relative to the same period in 2011. The increase in expenses was the result of hiring new personnel to accommodate future growth, expansion of infrastructure, investment in operating systems to improve services, costs associated with additional volume from residential mortgage activity, and dedicating resources to business marketing efforts to increase market share.

Balance Sheet

Total assets as of June 30, 2012 were $139.9 million, a 17.9% increase from the prior year. The increase was a result of a focused effort to generate core, organic loan growth in our primary market. Total portfolio loans reached $113.1 million at the end of the second quarter, an increase of $6.4 million from March 31, 2012 and $13.0 million from June 30, 2011. The increase was primarily concentrated in commercial real estate and mortgage related loans. The asset quality of the Company remains solid; there were no non-performing asset outstanding and the allowance for loan loss was 1.45% of total portfolio loans. Total deposits as of June 30, 2012 were $122.6 million, an increase of 15.4% from the same period in 2011. The Bank also continues to be classified as well capitalized based on regulatory guidelines and the Tier 1 ratio was 9.82% for the quarter.

Birmingham Bloomfield Bancshares, Inc. is the holding company for Bank of Birmingham, a full-service community bank serving Oakland County. Bank of Birmingham is dedicated to providing financial services to small and medium sized businesses; their owners and employees; professionals; and individuals who work or reside in the Oakland County market area. Every Bank of Birmingham customer has a relationship manager who serves a single point of contact empowered to provide all the bank’s services. Birmingham Bloomfield Bancshares, Inc. marketmakers include Howe Barnes Hoefer and Arnett (acquired by Raymond James), Chicago; Monroe Securities, Chicago; and Hudson Securities, Inc., Jersey City, New Jersey.

Forward-Looking Statements

This news release contains comments or information that constitute forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995), which involve significant risks and uncertainties. Actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include: changes in interest rates and interest-rate relationships; changes in the national and local economy; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking regulations; changes in tax laws; changes in prices, levies, and assessments; our ability to successfully integrate acquisitions into our existing operations, and the availability of new acquisitions, joint ventures and alliance opportunities; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; and other factors included in the Company’s filings with the Securities and Exchange Commission, available free via EDGAR. The Company assumes no responsibility to update forward-looking statements.

(Unaudited Consolidated Financial Statements Follow)

Birmingham Bloomfield Bancshares, Inc.

Consolidated Balance Sheet (Unaudited)


	June 30, 2012			December 31, 2011			June 30, 2011
ASSETS
Cash and due from banks	$	17,114,837		$	4,693,585		$	13,251,574
Federal funds sold		—			—			—

Total cash and cash equivalents		17,114,837			4,693,585			13,251,574
Securities available-for-sale		3,932,096			4,594,761			2,951,686
Securities held-to-maturity		—			—			—
Federal Home Loan Bank Stock		218,100			169,900			169,900

Total securities		4,150,196			4,764,661			3,121,586
Loans held for sale		—			2,484,829			793,209
Portfolio loans
Consumer loans		1,163,050			1,305,501			1,065,737
Mortgage loans		14,503,119			11,572,620			10,545,335
Commercial loans		97,408,101			93,419,805			88,467,511

Total loans		113,074,270			106,297,926			100,078,583
Less: Allowance for loan loss		1,644,350			1,574,350			1,502,099

Net loans		111,429,920			104,723,576			98,576,484
Premises and equipment, net		1,327,169			1,395,187			1,480,407
Bank owned life insurance		2,141,791			2,100,000			—
Accrued interest receivable and other assets		3,687,380			4,235,623			1,380,689

*TOTAL ASSETS*	$	139,851,293		$	124,397,461		$	118,603,949

LIABILITIES
Deposits
Noninterest-bearing	$	20,714,602		$	19,662,283		$	16,374,765
Interest-bearing		101,935,329			88,015,546			89,930,476

Total deposits		122,649,931			107,677,829			106,305,241
Short term borrowings		—			—			—
Accrued interest payable, taxes and other liabilities		655,566			755,090			602,245

Total liabilities		123,305,497			108,432,919			106,907,486
SHAREHOLDERS’ EQUITY
Senior preferred stock A								1,635,000
Discount on senior preferred stock A								(51,826	)
Warrant preferred stock B								82,000
Premium on warrant preferred stock B								5,633
Senior preferred stock C								1,744,000
Senior preferred stock, series D		4,621,000			4,621,000			—
Common Stock, no par value		17,105,618			17,066,618			17,034,330
Authorized—9,000,000 shares, Issued and outstanding—1,824,662
1,812,662 and 1,800,000 shares respectively
Accumulated other comprehensive income		93,209			95,168			139,975
Additional paid in capital—share based payments		493,154			493,154			493,154
Accumulated deficit		(5,767,185	)		(6,311,398	)		(9,385,803	)

Total shareholders’ equity		16,545,796			15,964,542			11,696,463

*TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY*	$	139,851,293		$	124,397,461		$	118,603,949

*Book value per share*	$	6.54		$	6.26		$	4.60

Birmingham Bloomfield Bancshares, Inc.

Consolidated Statement of Income (Unaudited)


	For the three months ended				For the six months ended
	June 30,				June 30,
	2012		2011		2012		2011
Interest Income
Interest and fees on loans
Commercial loans	$	1,487,392	$	1,401,178	$	2,915,068	$	2,814,965
Installment loans		16,221		13,459		34,278		26,547
Mortgage loans		61,775		15,644		111,493		35,169
Home Equity loans		93,516		97,661		187,738		195,592
Late charges and fees		31,610		6,302		34,253		17,780

*Total loan interest and fee income*		1,690,514		1,534,244		3,282,831		3,090,053
Interest bearing deposits		3,176		5,733		6,590		10,351
Federal Funds Sold		—		—		—		13
Interest on investment securities
Taxable		24,252		24,811		48,940		52,722
Tax-exempt		1,000		—		2,008		—

*Total investment income*		25,252		24,811		50,948		52,722
*Total interest income*		1,718,942		1,564,788		3,340,369		3,153,139
Interest Expense
Interest on deposits		223,390		313,877		450,947		627,932
Interest on borrowed funds		—		—		64		14,509

*Total interest expense*		223,390		313,877		451,011		642,441

*Net Interest Income*		1,495,552		1,250,911		2,889,358		2,510,698
Provision for loan losses		50,000		15,000		70,000		54,000

*Net Interest Income After Provision for Loan Losses*		1,445,552		1,235,911		2,819,358		2,456,698
Non-interest Income
Service charge income		20,499		12,589		39,297		24,161
Mortgage banking activities		34,039		47,322		196,867		58,761
SBA loan sales		26,958		209,439		148,749		500,733
Other income		30,130		10,814		210,702		21,618

*Total non-interest income*		111,626		280,164		595,615		605,273
Non-interest Expense
Salaries and employee benefits		640,169		643,368		1,401,839		1,225,385
Occupancy expense		114,936		125,583		234,667		243,685
Equipment expense		51,127		42,188		100,279		77,588
Advertising		47,874		44,697		90,468		80,743
Data Processing		58,039		60,560		117,041		109,573
Professional fees		159,267		145,916		276,301		257,440
Loan origination expense		38,044		22,681		107,056		49,050
Regulatory Assessments		23,715		33,901		48,975		82,327
Other expense		83,059		87,625		178,099		164,144

*Total non-interest expense*		1,216,230		1,206,519		2,554,725		2,289,935
*Net Income Before Income Taxes*		340,948		309,556		860,248		772,036
Income tax expense		111,298		—		282,651		—

*Net Income*		229,650		309,556		577,597		772,036
Dividend and accretion on preferred stock		21,831		48,182		33,384		96,365

*Net Income applicable to common shareholders*	$	207,819	$	261,374	$	544,213	$	675,671

*Income per share—basic*	$	0.11	$	0.15	$	0.30	$	0.38

Birmingham Bloomfield Bancshares, Inc.

Financial Summary and Selected Ratios (Unaudited)

(Dollars in thousands except per share data)


	Year to Date
	June 30,						Change
	2012			2011			Amount			Percentage
INCOME STATEMENT
Interest Income	$	3,340		$	3,153		$	187			5.9	%
Interest Expense		451			642			(191	)		-29.8	%

Net Interest Income		2,889			2,511			379			15.1	%
Provision for loan loss		70			54			16			29.6	%
Non-interest income		596			605			(10	)		-1.6	%
Non-interest expense		2,555			2,290			265			11.6	%

Net Income before Income Taxes		860			772			88			11.4	%
Income tax expense		283			—			283			0.0	%

Net Income		578			772			(194	)		-25.2	%
Dividend and accretion on preferred stock		33			96			(63	)		-65.4	%

Net Income—common shareholders	$	544		$	676		$	(131	)		-19.5	%

Income per share—basic & diluted	$	0.30		$	0.38		$	(0.08	)		-20.1	%

BALANCE SHEET DATA
Total assets		139,851			118,604			21,247			17.9	%
Average Assets		130,437			116,223			14,214			12.2	%
Total loans		113,074			100,079			12,996			13.0	%
Allowance for loan loss (ALLL)		1,644			1,502			142			9.5	%
Total deposits		122,650			106,305			16,345			15.4	%
Other borrowings		—			—			—			0.0	%
Shareholders’ equity		16,546			11,696			4,849			41.5	%
Average Equity		16,308			11,325			4,983			44.0	%
ASSET QUALITY
Other real estate owned (OREO)		—			298			(298	)		-100.0	%
Net charge-offs		—			—			—			0.0	%
Non-accrual loans		—			—			—			0.0	%
(2) Non-performing assets (NPA)		—			298			(298	)		-100.0	%
Non-accrual loans / total loans		0.00	%		0.00	%		0.00	%		0.0	%
Allowance for loan loss / total loans		1.45	%		1.50	%		-0.05	%		-3.1	%
PERFORMANCE MEASUREMENTS
Net interest margin (tax equivalent)		4.86	%		4.50	%		0.36	%		8.0	%
(1) Return on average assets (annualized)		0.89	%		1.34	%		-0.45	%		-33.6	%
(3) Return on average assets (annualized)		1.43	%		1.43	%		0.00	%		-0.2	%
(1) Return on average common equity (annualized)		9.94	%		19.68	%		-9.74	%		-49.5	%
(3) Return on average common equity (annualized)		16.01	%		21.05	%		-5.04	%		-23.9	%
Efficiency ratio		73.31	%		73.49	%		-0.18	%		-0.2	%
Tier 1 Leverage Ratio (Bank only)		9.82	%		8.54	%		1.28	%		14.99	%
Equity / Assets		11.83	%		9.86	%		1.97	%		20.0	%
Total loans / Total deposits		92.2	%		94.1	%		-1.95	%		-2.1	%
Book value per share	$	6.54		$	4.60		$	1.93			42.0	%
Income (loss) per share—basic & diluted	$	0.30		$	0.38		$	(0.08	)		-20.1	%
Shares outstanding		1,824,662			1,800,000			24,662			1.4	%
Average shares outstanding		1,814,442			1,800,000			14,442			0.8	%

(1)	Amount is computed on net income before preferred dividends.

(2)	Non-performing assets includes non-accrual loans and other real estate owned.

(3)	Amount is computed on pre-tax, pre-provision earnings before preferred dividends

Birmingham Bloomfield Bancshares, Inc.

Financial Summary and Selected Ratios (Unaudited)

(Dollars in thousands except per share data)


	Quarter Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2012			2012			2011			2011			2011
INCOME STATEMENT
Interest Income	$	1,719		$	1,621		$	1,630		$	1,582		$	1,565
Interest Expense		223			228			280			301			314

Net Interest Income		1,496			1,394			1,350			1,281			1,251
Provision for loan loss		50			20			75			105			15
Non-interest income		112			484			309			319			280
Non-interest expense		1,216			1,338			1,484			1,317			1,207

Net Income before Income Taxes		341			519			100			177			310
Income tax expense (benefit)		111			171			(2,885	)		—			—

Net Income		230			348			2,985			177			310
Dividend and accretion on preferred stock		22			12			20			68			48

Net Income applicable to common shareholders	$	208		$	336		$	2,965		$	109		$	261

Income per share—basic & diluted	$	0.11		$	0.19		$	1.64		$	0.06		$	0.15

BALANCE SHEET DATA
Total assets		139,851			128,663			124,397			124,743			118,604
Average Assets		134,375			126,499			123,317			121,526			117,002
Total loans		113,074			106,628			106,298			102,580			100,079
Allowance for loan loss (ALLL)		1,644			1,594			1,574			1,499			1,502
Total deposits		122,650			111,774			107,678			111,171			106,305
Other borrowings		—			—			—			—			—
Shareholders’ equity		16,546			16,297			15,965			13,056			11,696
Average Equity		16,410			16,206			13,584			12,520			11,481
ASSET QUALITY
Other real estate owned (OREO)		—			—			298			298			298
Net charge-offs		—			—			—			108			—
Non-accrual loans		—			—			—			—			—
(2) Non-performing assets (NPA)		—			—			298			298			298
Non-accrual loans / total loans		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%
Allowance for loan loss / total loans		1.45	%		1.50	%		1.48	%		1.46	%		1.50	%
PERFORMANCE MEASUREMENTS
Net interest margin (tax equivalent)		4.91	%		4.80	%		4.61	%		4.44	%		4.51	%
(1) Return on average assets (annualized)		0.69	%		1.11	%		9.60	%		0.58	%		1.06	%
(3) Return on average assets (annualized)		1.17	%		1.71	%		0.56	%		0.92	%		1.11	%
(1) Return on average common equity (annualized)		7.84	%		12.08	%		132.13	%		8.50	%		15.39	%
(3) Return on average common equity (annualized)		13.34	%		18.72	%		7.77	%		13.54	%		16.13	%
Efficiency ratio		75.67	%		71.28	%		89.43	%		82.37	%		78.80	%
Tier 1 Leverage Ratio (Bank only)		9.82	%		10.13	%		9.94	%		9.22	%		8.54	%
Equity / Assets		11.83	%		12.67	%		12.83	%		10.47	%		9.86	%
Total loans / Total deposits		92.2	%		95.4	%		98.7	%		92.3	%		94.1	%
Book value per share	$	6.54		$	6.44		$	6.26		$	4.65		$	4.60
Income (loss) per share—basic & diluted	$	0.11		$	0.19		$	1.64		$	0.06		$	0.15
Shares outstanding		1,824,662			1,812,662			1,812,662			1,812,662			1,800,000
Average shares outstanding		1,816,222			1,812,662			1,812,662			1,801,652			1,800,000

(1)	Amount is computed on net income before preferred dividends.

(2)	Non-performing assets includes non-accrual loans and other real estate owned.

(3)	Amount is computed on pre-tax, pre-provision earnings before preferred dividends

For Immediate Release:

Robert M. Farr

Chief Executive Officer

Birmingham Bloomfield Bancshares, Inc.