COBIZ FINANCIAL INC - FORM 8-K - EX-99.1

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8-K - 8-K - COBIZ FINANCIAL INC	f8-k.htm

Exhibit 99.1

CoBiz Financial Announces Second Quarter 2017 Results

Denver -- CoBiz Financial Inc. (Company) (NASDAQ: COBZ), a financial services company with $3.8 billion in assets, reported financial results for the second quarter of 2017.

Financial Highlights – Second quarter 2017

•Net income of $9.5 million for the second quarter of 2017, compared to $8.5 million in the second quarter of 2016.

•Diluted earnings per share of $0.23 for the second quarter of 2017, compared to $0.21 in the second quarter of 2016.

•Loans increased $247.3 million, or 8.8%, from June 30, 2016 and $73.9 million from March 31, 2017.

•Deposits increased $266.3 million, or 9.5%, from June 30, 2016 and $22.5 million from March 31, 2017.

•Nonperforming assets (NPAs) to total assets of 0.25% at June 30, 2017, compared to 0.32% at June 30, 2016 and 0.22% at March 31, 2017.

Financial Summary


	Quarter ended (unaudited)										2Q17 change vs.
(in thousands, except per share amounts)	2Q17			1Q17			2Q16			1Q17				2Q16
Net interest income before provision	$	32,005		$	30,078		$	28,533		$	1,927	6.4	%	$	3,472	12.2	%
Provision for loan losses		673			607			(1,652)			66	10.9	%		2,325	140.7	%
Net interest income after provision		31,332			29,471			30,185			1,861	6.3	%		1,147	3.8	%
Total noninterest income		8,311			8,328			7,812			(17)	(0.2)	%		499	6.4	%
Total noninterest expense		26,655			27,114			26,268			(459)	(1.7)	%		387	1.5	%
Net income before income taxes		12,988			10,685			11,729			2,303	21.6	%		1,259	10.7	%
Provision for income taxes		3,499			2,071			3,197			1,428	69.0	%		302	9.4	%
Net income	$	9,489		$	8,614		$	8,532		$	875	10.2	%	$	957	11.2	%

Diluted earnings per common share	$	0.23		$	0.20		$	0.21		$	0.03	13.6	%	$	0.02	8.2	%

KEY RATIOS
Net interest margin		3.76	%		3.77	%		3.72	%
Efficiency ratio - taxable equivalent *		62.83	%		67.33	%		68.71	%
Return on average assets		1.01	%		0.96	%		1.01	%
Return on average shareholders' equity		12.10	%		11.38	%		12.19	%
Noninterest income as a percentage of taxable equivalent operating revenue *		19.61	%		20.42	%		20.44	%

* See accompanying Reconciliation of Non-GAAP Measures to GAAP

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Loans


	Quarter ended (unaudited)							2Q17 change vs.
(in thousands)	2Q17		1Q17		2Q16		1Q17				2Q16
LOANS
Commercial	$	1,272,304	$	1,241,365	$	1,218,723	$	30,939	2.5	%	$	53,581	4.4	%
Owner-occupied real estate		481,180		473,775		446,699		7,405	1.6	%		34,481	7.7	%
Investor real estate		747,765		723,476		607,168		24,289	3.4	%		140,597	23.2	%
Construction & land		162,318		166,553		184,620		(4,235)	(2.5)	%		(22,302)	(12.1)	%
Consumer		287,790		271,751		258,773		16,039	5.9	%		29,017	11.2	%
Other		109,597		110,148		97,720		(551)	(0.5)	%		11,877	12.2	%
Total loans	$	3,060,954	$	2,987,068	$	2,813,703	$	73,886	2.5	%	$	247,251	8.8	%

•Loans at June 30, 2017 increased $247.3 million, or 8.8%, from June 30, 2016 and $73.9 million from March 31, 2017.

•Loans in the Arizona and Colorado markets increased $151.9 million and $95.4 million, respectively, from June 30, 2016. Compared to March 31, 2017, loans in the Arizona market increased $34.6 million while loans in the Colorado market increased $39.3 million.


	Quarter ended (unaudited)
(in thousands)	2Q17		1Q17		4Q16		3Q16		2Q16
Loans - beginning balance	$	2,987,068	$	2,934,105	$	2,827,105	$	2,813,703	$	2,716,888
New credit extended		190,431		151,241		273,195		154,319		201,018
Credit advanced		129,633		113,458		105,122		108,074		135,294
Paydowns & maturities		(245,976)		(211,630)		(270,167)		(248,760)		(239,447)
Gross loan charge-offs		(202)		(106)		(1,150)		(231)		(50)
Loans - ending balance	$	3,060,954	$	2,987,068	$	2,934,105	$	2,827,105	$	2,813,703

Net change - loans outstanding	$	73,886	$	52,963	$	107,000	$	13,402	$	96,815

•New credit extensions and advances were $320.1 million in the second quarter of 2017, compared to $336.3 million in the second quarter of 2016 and $264.7 million in the quarter-ended March 31, 2017 (linked-quarter).

•Commercial line utilization was 32.6% at June 30, 2017, compared to 36.3% and 32.9%, respectively, at June 30, 2016 and March 31, 2017.

Deposits and Customer Repurchase Agreements



	Quarter ended (unaudited)							2Q17 change vs.
(in thousands)	2Q17		1Q17		2Q16		1Q17				2Q16
DEPOSITS AND CUSTOMER REPURCHASE AGREEMENTS
Money market	$	898,615	$	910,089	$	853,815	$	(11,474)	(1.3)	%	$	44,800	5.2	%
Interest-bearing demand		696,971		704,659		591,355		(7,688)	(1.1)	%		105,616	17.9	%
Savings		22,748		20,192		19,097		2,556	12.7	%		3,651	19.1	%
Certificates of deposits under $100		18,748		19,045		19,836		(297)	(1.6)	%		(1,088)	(5.5)	%
Certificates of deposits $100 and over		79,103		81,611		89,008		(2,508)	(3.1)	%		(9,905)	(11.1)	%
Reciprocal CDARS		42,046		41,200		49,210		846	2.1	%		(7,164)	(14.6)	%
Total interest-bearing deposits		1,758,231		1,776,796		1,622,321		(18,565)	(1.0)	%		135,910	8.4	%
Noninterest-bearing demand deposits		1,314,408		1,273,305		1,184,023		41,103	3.2	%		130,385	11.0	%
Total deposits		3,072,639		3,050,101		2,806,344		22,538	0.7	%		266,295	9.5	%
Customer repurchase agreements		69,203		59,825		37,908		9,378	15.7	%		31,295	82.6	%
Total deposits and customer repurchase agreements	$	3,141,842	$	3,109,926	$	2,844,252	$	31,916	1.0	%	$	297,590	10.5	%

•Total deposits at June 30, 2017 increased $266.3 million, or 9.5%, from June 30, 2016 and $22.5 million from March 31, 2017.

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•Noninterest-bearing demand accounts at June 30, 2017 increased $130.4 million from June 30, 2016, and increased $41.1 million from March 31, 2017 and were 42.8% of total deposits at June 30, 2017.

Credit Quality


	Quarter ended (unaudited)
(in thousands)	2Q17			1Q17			2Q16
ALLOWANCE FOR LOAN LOSSES
Beginning allowance for loan losses	$	34,211		$	33,293		$	35,285
Provision for loan losses		673			607			(1,652)
Net recovery (charge-off)		741			311			711
Ending allowance for loan losses	$	35,625		$	34,211		$	34,344

CREDIT QUALITY
Nonaccrual loans	$	3,830		$	3,048		$	5,994
Loans 90 days or more past due and accruing interest		664			-			-
Total nonperforming loans		4,494			3,048			5,994
OREO and repossessed assets		5,079			5,079			5,079
Total nonperforming assets	$	9,573		$	8,127		$	11,073

Performing renegotiated loans	$	31,482		$	23,324		$	27,240
Classified loans	$	50,587		$	54,291		$	58,163

ASSET QUALITY MEASURES
Nonperforming assets to total assets		0.25	%		0.22	%		0.32	%
Nonperforming loans to total loans		0.15	%		0.10	%		0.21	%
Nonperforming loans and OREO to total loans and OREO		0.31	%		0.27	%		0.39	%
Allowance for loan losses to total loans		1.16	%		1.15	%		1.22	%
Allowance for loan losses to nonperforming loans		792.72	%		1,122.41	%		572.97	%

•NPAs increased $1.4 million from March 31, 2017 and decreased $1.5 million from June 30, 2016, and were $9.6 million at June 30, 2017.

•The Company had net recoveries of $0.7 million in the second quarter of 2017.

•A provision for loan losses of $0.7 million was recorded in the second quarter of 2017.

•The resulting allowance for loan losses was 1.16% of total loans at June 30, 2017.

Shareholders’ Equity


	Quarter ended (unaudited)
(in thousands, except per share amounts)	2Q17			1Q17			2Q16
EQUITY MEASURES
Common shareholders' equity	$	319,470		$	310,209		$	286,052

Common shares outstanding at period end		41,771			41,731			41,433

Book value per common share	$	7.65		$	7.43		$	6.90
Tangible book value per common share *	$	7.62		$	7.41		$	6.86

Tangible common equity to tangible assets *		8.37	%		8.28	%		8.23	%
Tier 1 capital ratio		**			11.46	%		10.75	%
Total risk-based capital ratio		**			14.30	%		13.77	%

* See accompanying Reconciliation of Non-GAAP Measures to GAAP

** Ratios unavailable at the time of release

•On July 20, 2017, the Board of Directors of the Company declared a quarterly cash dividend of $0.055 per common share. The dividend will be paid on August 7, 2017 to shareholders of record on July 31, 2017.

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Net Interest Income and Margin

•Net interest income on a taxable-equivalent basis (NII) was $34.1 million for the second quarter of 2017, an increase of $3.7 million, or 12.0%, from the quarter ended June 30, 2016. From the quarter ended March 31, 2017, NII increased $1.6 million, or 4.9%.

•Net interest margin (NIM) was 3.76% for the second quarter of 2017, compared to 3.72% in the prior-year quarter and 3.77% in the first quarter of 2017.

•The average yield on interest-earning assets was 4.08% for the second quarter of 2017, compared to 4.02% in the prior-year quarter and 4.06% in the first quarter of 2017.

•Items impacting NII and the NIM in the second quarter of 2017 were:

A tax-exempt loan prepaid during the quarter that resulted in the accelerated amortization of a $0.2 million loan premium which, on a taxable-equivalent basis, reduced NIM four basis points in the second quarter of 2017.

Quarterly average loans increased $259.2 million, or 9.3%, from the prior-year quarter, and $107.9 million from the linked-quarter.

Quarterly average investments increased $88.1 million, or 18.1%, from the prior-year quarter, and $36.2 million from the linked-quarter. The growth in investments in the first half of 2017 increased the ratio of average investments to average interest-earning assets to 15.8% at June 30, 2017 from 14.0% at December 31, 2016.

Quarterly average deposits increased $211.2 million, or 7.5%, from the prior-year quarter, and decreased $13.5 million from the linked-quarter. The decline in average deposits during the second quarter of 2017 is a result of typical outflows by our commercial clients as they make distributions and tax payments during the quarter.

Including noninterest-bearing deposits, the Company’s deposit interest cost has remained stable at 0.13% for the current, prior-year and linked-quarters.

Average noninterest-bearing demand accounts increased $99.5 million, or 8.2%, from the prior-year quarter and $11.4 million from the linked-quarter.

Average other short-term borrowings increased $91.2 million, or 68.3%, from the prior-year quarter, and increased $134.7 million from the linked-quarter. The shift in funding mix from core deposits into more expensive short–term borrowings reduces the NIM.

Noninterest Income


	Quarter ended (unaudited)							2Q17 change vs.
(in thousands)	2Q17		1Q17		2Q16		1Q17				2Q16
Noninterest income:
Deposit service charges	$	1,714	$	1,745	$	1,470	$	(31)	(1.8)	%	$	244	16.6	%
Investment advisory income		1,500		1,531		1,430		(31)	(2.0)	%		70	4.9	%
Insurance income		3,427		3,122		3,112		305	9.8	%		315	10.1	%
Other investments		372		375		420		(3)	(0.8)	%		(48)	(11.4)	%
Derivative valuation		(80)		(57)		(163)		(23)	(40.4)	%		83	50.9	%
Other income		1,378		1,612		1,543		(234)	(14.5)	%		(165)	(10.7)	%
Total noninterest income	$	8,311	$	8,328	$	7,812	$	(17)	(0.2)	%	$	499	6.4	%

•Noninterest income increased $0.5 million, or 6.4%, from the prior-year quarter and was flat with the linked-quarter.

•Noninterest income as a percentage of taxable equivalent operating revenue* was 19.6% for the second quarter of 2017, compared to 20.4% for both the prior-year and linked-quarters.

* See accompanying reconciliation of Non-GAAP Measures to GAAP

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Operating Expenses


	Quarter ended (unaudited)							2Q17 change vs.
(in thousands)	2Q17		1Q17		2Q16		1Q17				2Q16
Noninterest expense:
Salaries and employee benefits	$	18,335	$	19,120	$	17,984	$	(785)	(4.1)	%	$	351	2.0	%
Occupancy expenses, premises and equipment		3,685		3,605		3,517		80	2.2	%		168	4.8	%
Amortization of intangibles		150		150		150		-	-	%		-	-	%
Other operating expenses		4,453		4,584		4,610		(131)	(2.9)	%		(157)	(3.4)	%
Net (gain) loss on OREO, repossessed assets and other		32		(345)		7		377	109.3	%		25	3.6	%
Total noninterest expense	$	26,655	$	27,114	$	26,268	$	(459)	(1.7)	%	$	387	1.5	%

•Noninterest expense increased $0.4 million, or 1.5%, from the prior-year quarter and decreased $0.5 million from the linked-quarter. The increase in noninterest expense compared to the prior-year quarter was due to an increase in salaries and employee benefits from an increase in full-time equivalent employees and an annual merit increase. The decrease in noninterest expense compared to the linked-quarter was from a decline in medical costs due to lower self-insured medical claims and a decline in payroll taxes.

•The taxable-equivalent efficiency ratio* was 62.8% for the second quarter of 2017, compared to 68.7% and 67.3%, respectively, for the prior-year and linked-quarters.

Provision for Income Taxes

The Company’s effective tax rate for the second quarter of 2017 was 26.9%, compared to 27.3% in the prior year quarter and 19.4% in the first quarter of 2017. The linked-quarter increase in the effective tax rate was due to an increased projection of earnings and the ratio of taxable to tax-exempt earnings for fiscal 2017 combined with a decline in stock compensation tax benefits.

Earnings Conference Call

In conjunction with this release, you are invited to listen to the Company's conference call on Friday, July 21, 2017 at 9:00 am MDT with Steve Bangert, chairman and CEO of CoBiz Financial Inc. The call can be accessed via the Internet at https://www.webcaster4.com/Webcast/Page/989/21434 or by telephone at 877.493.9121 (conference ID # 36524896).

Explanation of the Company’s Use of Non-GAAP Financial Measures

This earnings release contains GAAP financial measures and non-GAAP financial measures where management believes it to be helpful in understanding our results of operations and reflects the basis on which management internally reviews financial performance and capital adequacy. The Company believes these measures are useful supplementary financial measures that enable investors to assess the performance of the Company’s operations and for comparison to the Company’s peers. However, you should not rely on non-GAAP financial measures alone as measures of our performance. Please see the accompanying Reconciliation of Non-GAAP Measures to GAAP for additional information.

Contact Information

CoBiz Financial Inc.

Lyne Andrich 303.312.3458

* See accompanying reconciliation of Non-GAAP Measures to GAAP

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About CoBiz Financial

CoBiz Financial (NASDAQ:COBZ) is a $3.8 billion financial services company that serves the complete financial needs of businesses, business owners and professionals in Colorado and Arizona. The Company provides banking services through Colorado Business Bank, Arizona Business Bank and CoBiz Private Bank; wealth planning and investment management through CoBiz Wealth Management; and property and casualty insurance brokerage and employee benefits through CoBiz Insurance.

Forward-Looking Information

This release contains forward-looking statements that describe CoBiz's future plans, strategies and expectations. Forward-looking statements include statements about future performance and results of operations. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning, or future or conditional verbs such as "would”, "could", “should” or "may." Forward-looking statements speak only as of the date they are made. All forward-looking statements are based on assumptions and involve risks and uncertainties, many of which are beyond our control and which may cause our actual results, performance or achievements to differ materially from the results, performance or achievements contemplated by the forward-looking statements. Such risks and uncertainties include, among other things:

•Risks and uncertainties described in our reports filed with the Securities and Exchange Commission, including our most recent Form 10-K.

•Competitive pressures among depository and other financial institutions nationally and in our market areas may increase significantly.

•Adverse changes in the economy or business conditions, either nationally or in our market areas, could increase credit-related losses and expenses and/or limit growth.

•Increases in defaults by borrowers and other delinquencies could result in increases in our provision for losses on loans and related expenses.

•Our ability to manage growth effectively could adversely affect our results of operations and prospects.

•Fluctuations in interest rates and market prices could reduce our net interest margin and asset valuations and increase our expenses.

•The consequences of continued bank acquisitions and mergers in our market areas, resulting in fewer but much larger and financially stronger competitors, could increase competition for financial services to our detriment.

•Changes in legislative or regulatory requirements applicable to us and our subsidiaries and implementation of current legislative or regulatory requirements could increase costs, limit certain operations and adversely affect results of operations.

•Changes in tax requirements, including tax rate changes, new tax laws and revised tax law interpretations may increase our tax expense or adversely affect our customers' businesses.

In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements in this release. We undertake no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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CoBiz Financial Inc.

June 30, 2017

(unaudited)


	Three months ended June 30,				Six months ended June 30,
(in thousands, except per share amounts)	2017		2016		2017			2016
INCOME STATEMENT DATA
Interest income	$	35,406	$	31,500	$	68,487		$	62,695
Interest expense		3,401		2,967		6,404			5,933
NET INTEREST INCOME BEFORE PROVISION		32,005		28,533		62,083			56,762
Provision for loan losses		673		(1,652)		1,280			(1,282)
NET INTEREST INCOME AFTER PROVISION		31,332		30,185		60,803			58,044
Noninterest income		8,311		7,812		16,639			15,500
Noninterest expense		26,655		26,268		53,769			52,100
INCOME BEFORE INCOME TAXES		12,988		11,729		23,673			21,444
Provision for income taxes		3,499		3,197		5,570			5,547
NET INCOME	$	9,489	$	8,532	$	18,103		$	15,897

EARNINGS PER COMMON SHARE
Basic	$	0.23	$	0.21	$	0.43		$	0.39
Diluted	$	0.23	$	0.21	$	0.43		$	0.38

EQUITY MEASURES
Common shares outstanding at period end (in thousands)						41,771			41,433
Book value per common share					$	7.65		$	6.90
Tangible book value per common share *					$	7.62		$	6.86
Tangible common equity to tangible assets *						8.37	%		8.23	%

* See accompanying Reconciliation of Non-GAAP Measures to GAAP

PERIOD END BALANCES
Total assets					$	3,803,490		$	3,457,516
Investments						568,181			477,617
Loans						3,060,954			2,813,703
Intangible assets						1,026			1,626
Deposits						3,072,639			2,806,344
Subordinated debentures						131,318			131,236
Common shareholders' equity						319,470			286,052
Interest-earning assets						3,656,377			3,325,368
Interest-bearing liabilities						2,140,752			1,956,402

BALANCE SHEET AVERAGES
Average assets					$	3,703,281		$	3,373,024
Average investments						557,378			497,553
Average loans						2,983,284			2,739,636
Average deposits						3,019,399			2,754,991
Average subordinated debentures						131,297			131,216
Average shareholders' equity						310,831			278,739
Average interest-earning assets						3,563,477			3,257,867
Average interest-bearing liabilities						2,053,971			1,887,362

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CoBiz Financial Inc.

June 30, 2017

(unaudited)


	Three months ended June 30,						Six months ended June 30,
(in thousands)	2017			2016			2017			2016
PROFITABILITY MEASURES
Net interest margin		3.76	%		3.72	%		3.76	%		3.73	%
Efficiency ratio - taxable equivalent *		62.83	%		68.71	%		65.04	%		68.67	%
Return on average assets		1.01	%		1.01	%		0.99	%		0.95	%
Return on average shareholders' equity		12.10	%		12.19	%		11.74	%		11.47	%
Noninterest income as a percentage of taxable equivalent operating revenue *		19.61	%		20.44	%		20.01	%		20.43	%

CREDIT QUALITY
Nonperforming loans
Nonaccrual loans							$	3,830		$	5,994
Loans 90 days or more past due and accruing interest								664			-
Total nonperforming loans								4,494			5,994
OREO & repossessed assets								5,079			5,079
Total nonperforming assets							$	9,573		$	11,073

Performing renegotiated loans							$	31,482		$	27,240
Classified loans							$	50,587		$	58,163

Charge-offs							$	(308)		$	(6,423)
Recoveries								1,360			1,363
Net recoveries (charge-offs)							$	1,052		$	(5,060)

Nonperforming assets to total assets								0.25	%		0.32	%
Nonperforming loans to total loans								0.15	%		0.21	%
Nonperforming loans and OREO to total loans and OREO								0.31	%		0.39	%
Allowance for loan losses to total loans								1.16	%		1.22	%
Allowance for loan losses to nonperforming loans								792.72	%		572.97	%


										Total		NPAs as a
NONPERFORMING ASSETS BY MARKET	Colorado			Arizona			Total			in Category		%
Commercial	$	2,997		$	442		$	3,439		$	1,272,304	0.27	%
Real estate - mortgage		664			245			909			1,228,945	0.07	%
Construction & land		-			-			-			162,318	-	%
Consumer		146			-			146			287,790	0.05	%
Other loans		-			-			-			109,597	-	%
OREO & repossessed assets		4,903			176			5,079			5,079	-
NPAs	$	8,710		$	863		$	9,573		$	3,066,033	0.31	%

Total loans	$	1,963,177		$	1,097,777		$	3,060,954
Total loans and OREO		1,968,080			1,097,953			3,066,033
Nonperforming loans to loans		0.19	%		0.06	%		0.15	%
Nonperforming loans and OREO to total loans and OREO		0.44	%		0.08	%		0.31	%

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CoBiz Financial Inc.

June 30, 2017

(unaudited)


	Three months ended
	June 30,			March 31,			December 31,			September 30,			June 30,
(in thousands, except per share amounts)	2017			2017			2016			2016			2016
Interest income	$	35,406		$	33,081		$	32,779		$	32,308		$	31,500
Interest expense		3,401			3,003			2,891			2,907			2,967
Net interest income before provision		32,005			30,078			29,888			29,401			28,533
Provision for loan losses		673			607			349			(1,168)			(1,652)
Net interest income after provision		31,332			29,471			29,539			30,569			30,185
Noninterest income:
Deposit service charges	$	1,714		$	1,745		$	1,551		$	1,553		$	1,470
Investment advisory income		1,500			1,531			1,418			1,416			1,430
Insurance income		3,427			3,122			3,286			3,120			3,112
Other investments		372			375			215			1,348			420
Derivative valuation		(80)			(57)			737			-			(163)
Other income		1,378			1,612			2,167			1,849			1,543
Total noninterest income		8,311			8,328			9,374			9,286			7,812
Noninterest expense:
Salaries and employee benefits	$	18,335		$	19,120		$	18,378		$	17,480		$	17,984
Occupancy expenses, premises and equipment		3,685			3,605			3,934			4,025			3,517
Amortization of intangibles		150			150			150			150			150
Other operating expenses		4,453			4,584			4,659			4,486			4,610
Net (gain) loss on securities, other assets and OREO		32			(345)			(33)			(98)			7
Total noninterest expense		26,655			27,114			27,088			26,043			26,268
Net income before income taxes		12,988			10,685			11,825			13,812			11,729
Provision for income taxes		3,499			2,071			3,092			3,543			3,197
Net income	$	9,489		$	8,614		$	8,733		$	10,269		$	8,532

Earnings per common share
Basic	$	0.23		$	0.21		$	0.21		$	0.25		$	0.21
Diluted	$	0.23		$	0.20		$	0.21		$	0.25		$	0.21

PROFITABILITY MEASURES
Net interest margin		3.76	%		3.77	%		3.75	%		3.74	%		3.72	%
Efficiency ratio - taxable equivalent *		62.83	%		67.33	%		65.57	%		64.50	%		68.71	%
Return on average assets		1.01	%		0.96	%		0.98	%		1.18	%		1.01	%
Return on average shareholders' equity		12.10	%		11.38	%		11.56	%		14.04	%		12.19	%
Noninterest income as a percentage of taxable equivalent operating revenue *		19.61	%		20.42	%		22.66	%		22.91	%		20.44	%

EQUITY MEASURES
Common shares outstanding at period end (in thousands)		41,771			41,731			41,555			41,465			41,433
Diluted weighted average common shares outstanding (in thousands)		41,713			41,584			41,371			41,192			41,105
Book value per common share	$	7.65		$	7.43		$	7.27		$	7.13		$	6.90
Tangible book value per common share *	$	7.62		$	7.41		$	7.24		$	7.10		$	6.86

Tangible common equity to tangible assets *		8.37	%		8.28	%		8.29	%		8.53	%		8.23	%
Tier 1 capital ratio		**	%		11.46	%		11.59	%		11.52	%		10.75	%
Total risk-based capital ratio		**	%		14.30	%		14.48	%		14.47	%		13.77	%

* See accompanying Reconciliation of Non-GAAP Measures to GAAP

** Ratios unavailable at the time of release

9 | Page

CoBiz Financial Inc.

June 30, 2017

(unaudited)


	At
	June 30,			March 31,			December 31,			September 30,			June 30,
(in thousands)	2017			2017			2016			2016			2016
PERIOD END BALANCES
Total assets	$	3,803,490		$	3,731,342		$	3,630,313		$	3,452,498		$	3,457,516
Investments		568,181			572,106			510,387			455,082			477,617
Loans		3,060,954			2,987,068			2,934,105			2,827,105			2,813,703
Deposits		3,072,639			3,050,101			3,029,783			2,937,193			2,806,344
Common shareholders' equity		319,470			310,209			302,310			295,837			286,052

LOANS
Commercial	$	1,272,304		$	1,241,365		$	1,217,732		$	1,196,088		$	1,218,723
Real estate - mortgage		1,228,945			1,197,251			1,171,123			1,098,983			1,053,867
Construction & land		162,318			166,553			174,451			170,594			184,620
Consumer		287,790			271,751			267,013			263,871			258,773
Other		109,597			110,148			103,786			97,569			97,720
Gross loans		3,060,954			2,987,068			2,934,105			2,827,105			2,813,703
Less allowance for loan losses		(35,625)			(34,211)			(33,293)			(33,529)			(34,344)
Total net loans	$	3,025,329		$	2,952,857		$	2,900,812		$	2,793,576		$	2,779,359
Gross Loans - Colorado	$	1,963,177		$	1,923,932		$	1,869,086		$	1,868,582		$	1,867,772
Gross Loans - Arizona	$	1,097,777		$	1,063,136		$	1,065,019		$	958,523		$	945,931

DEPOSITS AND CUSTOMER REPURCHASE AGREEMENTS
Money market	$	898,615		$	910,089		$	861,856		$	854,928		$	853,815
Interest-bearing demand		696,971			704,659			714,062			681,256			591,355
Savings		22,748			20,192			19,561			20,403			19,097
Certificates of deposits under $100		18,748			19,045			19,899			20,151			19,836
Certificates of deposits $100 and over		79,103			81,611			87,692			87,593			89,008
Reciprocal CDARS		42,046			41,200			44,250			46,316			49,210
Total interest-bearing deposits		1,758,231			1,776,796			1,747,320			1,710,647			1,622,321
Noninterest-bearing demand deposits		1,314,408			1,273,305			1,282,463			1,226,546			1,184,023
Total deposits	$	3,072,639		$	3,050,101		$	3,029,783		$	2,937,193		$	2,806,344

BALANCE SHEET AVERAGES
Average assets	$	3,772,484		$	3,633,308		$	3,538,428		$	3,456,974		$	3,394,960
Average investments		575,363			539,195			475,750			462,766			487,309
Average loans		3,036,949			2,929,024			2,871,288			2,822,334			2,777,790
Average deposits		3,012,706			3,026,167			3,021,429			2,909,307			2,801,499
Average shareholders' equity		314,669			306,951			300,665			290,973			281,617
Average interest-earning assets		3,633,412			3,492,768			3,397,679			3,322,596			3,286,863
Average interest-bearing liabilities		2,115,642			1,991,616			1,887,410			1,869,875			1,883,198

ALLOWANCE FOR LOAN AND CREDIT LOSSES
Beginning allowance for loan losses	$	34,211		$	33,293		$	33,529		$	34,344		$	35,285
Provision for loan losses		673			607			349			(1,168)			(1,652)
Net recovery (charge-off)		741			311			(585)			353			711
Ending allowance for loan losses	$	35,625		$	34,211		$	33,293		$	33,529		$	34,344

CREDIT QUALITY
Nonperforming loans
Nonaccrual loans	$	3,830		$	3,048		$	2,638		$	5,046		$	5,994
Loans 90 days or more past due and accruing interest		664			-			657			-			-
Total nonperforming loans		4,494			3,048			3,295			5,046			5,994
OREO and repossessed assets		5,079			5,079			5,079			5,079			5,079
Total nonperforming assets	$	9,573		$	8,127		$	8,374		$	10,125		$	11,073
Performing renegotiated loans	$	31,482		$	23,324		$	23,612		$	25,291		$	27,240
Classified loans	$	50,587		$	54,291		$	57,905		$	58,376		$	58,163

ASSET QUALITY MEASURES
Nonperforming assets to total assets		0.25	%		0.22	%		0.23	%		0.29	%		0.32	%
Nonperforming loans to total loans		0.15	%		0.10	%		0.11	%		0.18	%		0.21	%
Nonperforming loans and OREO to total loans and OREO		0.31	%		0.27	%		0.28	%		0.36	%		0.39	%
Allowance for loan losses to total loans		1.16	%		1.15	%		1.13	%		1.19	%		1.22	%
Allowance for loan losses to nonperforming loans		792.72	%		1,122.41	%		1,010.41	%		664.47	%		572.97	%

10 | Page

CoBiz Financial Inc.

June 30, 2017

(unaudited)


	For the three months ended,
	June 30, 2017							March 31, 2017							June 30, 2016
				Interest		Average					Interest		Average					Interest		Average
	Average			earned		yield		Average			earned		yield		Average			earned		yield
(in thousands)	balance			or paid		or cost		balance			or paid		or cost		balance			or paid		or cost
ASSETS
Federal funds sold and other	$	21,100		$	54	1.01	%	$	24,549		$	56	0.91	%	$	21,764		$	25	0.45	%
Investment securities		575,363			3,999	2.78	%		539,195			3,796	2.82	%		487,309			3,364	2.76	%
Loans		3,036,949			33,409	4.35	%		2,929,024			31,608	4.32	%		2,777,790			29,985	4.27	%
Total interest-earning assets	$	3,633,412		$	37,462	4.08	%	$	3,492,768		$	35,460	4.06	%	$	3,286,863		$	33,374	4.02	%
Noninterest-earning assets		139,072							140,540							108,097
Total assets	$	3,772,484						$	3,633,308						$	3,394,960

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Money market	$	888,217		$	586	0.26	%	$	900,608		$	592	0.27	%	$	844,471		$	567	0.27	%
Interest-bearing demand		645,243			234	0.15	%		651,655			245	0.15	%		565,028			216	0.15	%
Savings		20,429			3	0.06	%		18,949			2	0.04	%		17,920			2	0.04	%
Certificates of deposit
Reciprocal		42,562			18	0.17	%		43,725			21	0.19	%		44,945			21	0.19	%
Under $100		18,939			17	0.36	%		19,470			17	0.35	%		21,094			20	0.38	%
$100 and over		80,085			97	0.49	%		85,891			110	0.52	%		90,280			113	0.50	%
Total interest-bearing deposits	$	1,695,475		$	955	0.23	%	$	1,720,298		$	987	0.23	%	$	1,583,738		$	939	0.24	%
Other borrowings
Securities sold under agreements to repurchase		64,181			9	0.06	%		50,093			8	0.06	%		34,754			5	0.06	%
Other short-term borrowings		224,679			593	1.04	%		89,939			176	0.78	%		133,481			183	0.54	%
Long-term debt		131,307			1,844	5.56	%		131,286			1,832	5.58	%		131,225			1,840	5.55	%
Total interest-bearing liabilities	$	2,115,642		$	3,401	0.64	%	$	1,991,616		$	3,003	0.61	%	$	1,883,198		$	2,967	0.63	%
Noninterest-bearing demand accounts		1,317,231							1,305,869							1,217,761
Total deposits and interest-bearing liabilities		3,432,873							3,297,485							3,100,959
Other noninterest-bearing liabilities		24,942							28,872							12,384
Total liabilities		3,457,815							3,326,357							3,113,343
Total shareholders' equity		314,669							306,951							281,617
Total liabilities and shareholders' equity	$	3,772,484						$	3,633,308						$	3,394,960
Net interest income - taxable equivalent				$	34,061						$	32,457						$	30,407
Net interest spread						3.44	%						3.45	%						3.39	%
Net interest margin						3.76	%						3.77	%						3.72	%
Ratio of average interest-earning assets to average interest-bearing liabilities		171.74	%						175.37	%						174.54	%

11 | Page

CoBiz Financial Inc.

June 30, 2017

(unaudited)


	For the six months ended June 30,
	2017							2016
				Interest		Average					Interest		Average
	Average			earned		yield		Average			earned		yield
(in thousands)	balance			or paid		or cost		balance			or paid		or cost
ASSETS
Federal funds sold and other	$	22,815		$	110	0.96	%	$	20,678		$	52	0.50	%
Investment securities		557,378			7,795	2.80	%		497,553			6,954	2.80	%
Loans		2,983,284			65,017	4.33	%		2,739,636			59,280	4.28	%
Total interest-earning assets	$	3,563,477		$	72,922	4.07	%	$	3,257,867		$	66,286	4.03	%
Noninterest-earning assets		139,804							115,157
Total assets	$	3,703,281						$	3,373,024

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Money market	$	894,378		$	1,178	0.27	%	$	825,386		$	1,110	0.27	%
Interest-bearing demand		648,431			479	0.15	%		570,050			422	0.15	%
Savings		19,693			5	0.05	%		17,959			5	0.06	%
Certificates of deposit
Reciprocal		43,140			39	0.18	%		40,979			36	0.18	%
Under $100		19,203			34	0.36	%		21,101			40	0.38	%
$100 and over		82,972			207	0.50	%		92,510			231	0.50	%
Total interest-bearing deposits	$	1,707,817		$	1,942	0.23	%	$	1,567,985		$	1,844	0.24	%
Other borrowings
Securities sold under agreements to repurchase		57,176			17	0.06	%		40,684			12	0.06	%
Other short-term borrowings		157,681			769	0.97	%		147,477			398	0.53	%
Long term-debt		131,297			3,676	5.57	%		131,216			3,679	5.55	%
Total interest-bearing liabilities	$	2,053,971		$	6,404	0.62	%	$	1,887,362		$	5,933	0.63	%
Noninterest-bearing demand accounts		1,311,582							1,187,006
Total deposits and interest-bearing liabilities		3,365,553							3,074,368
Other noninterest-bearing liabilities		26,897							19,917
Total liabilities		3,392,450							3,094,285
Total shareholders' equity		310,831							278,739
Total liabilities and shareholders' equity	$	3,703,281						$	3,373,024
Net interest income - taxable equivalent				$	66,518						$	60,353
Net interest spread						3.45	%						3.40	%
Net interest margin						3.76	%						3.73	%
Ratio of average interest-earning assets to average interest-bearing liabilities		173.49	%						172.61	%

12 | Page

CoBiz Financial Inc.

June 30, 2017

(unaudited)

Reconciliation of Non-GAAP Measures to GAAP

(in thousands, except per share amounts)

The Company believes these supplementary non-GAAP measures enable investors to obtain an understanding of the operating results of the Company’s core business and reflect the basis on which management internally reviews financial performance and capital adequacy. These non-GAAP measures are not a substitute for operating results determined in accordance with GAAP nor do they necessarily conform to non-GAAP performance measures that may be presented by other companies.

The following table includes non-GAAP financial measures related to tangible common equity, tangible assets and tangible book value per common share. Shareholders’ equity and total assets have been adjusted to exclude intangible assets.


		At
		June 30,			March 31,			December 31,			September 30,			June 30,
	(in thousands, except per share amounts)	2017			2017			2016			2016			2016
	Shareholders' equity as reported - GAAP	$	319,470		$	310,209		$	302,310		$	295,837		$	286,052
	Intangible assets		(1,026)			(1,176)			(1,326)			(1,476)			(1,626)
A	Tangible common equity - non-GAAP	$	318,444		$	309,033		$	300,984		$	294,361		$	284,426
	Total assets as reported - GAAP	$	3,803,490		$	3,731,342		$	3,630,313		$	3,452,498		$	3,457,516
	Intangible assets		(1,026)			(1,176)			(1,326)			(1,476)			(1,626)
B	Total tangible assets - non-GAAP	$	3,802,464		$	3,730,166		$	3,628,987		$	3,451,022		$	3,455,890
C	Common shares outstanding	$	41,771		$	41,731		$	41,555		$	41,465		$	41,433
A / B	Tangible common equity to tangible assets - non-GAAP		8.37	%		8.28	%		8.29	%		8.53	%		8.23	%
A / C	Tangible book value per common share - non-GAAP	$	7.62		$	7.41		$	7.24		$	7.10		$	6.86

The following table includes non-GAAP financial measures used in the computation of the efficiency ratio and the ratio of noninterest income to taxable equivalent operating revenue. The efficiency ratio equals noninterest expense adjusted to exclude gains and losses on securities, other assets and other real estate owned (OREO), divided by taxable equivalent operating revenue, which equals the sum of tax equivalent net interest income and noninterest income. To calculate tax equivalent net interest income, the interest earned on tax exempt loans and investment securities has been adjusted to reflect the amount that would have been earned had these investments been subject to normal income taxation.


		Three months ended
		June 30,			March 31,			December 31,			September 30,			June 30,
	(in thousands)	2017			2017			2016			2016			2016
	Noninterest expense - GAAP, adjusted for:	$	26,655		$	27,114		$	27,088		$	26,043		$	26,268
	Net (gain) loss on securities, other assets and OREO		32			(345)			(33)			(98)			7
D	Adjusted noninterest expense - non-GAAP	$	26,623		$	27,459		$	27,121		$	26,141		$	26,261
	Net interest income - GAAP	$	32,005		$	30,078		$	29,888		$	29,401		$	28,533
E	Noninterest income - GAAP		8,311			8,328			9,374			9,286			7,812
	Operating revenue		40,316			38,406			39,262			38,687			36,345
	Taxable equivalent adjustment		2,056			2,379			2,097			1,843			1,874
F	Operating revenue - taxable equivalent - non-GAAP	$	42,372		$	40,785		$	41,359		$	40,530		$	38,219
D / F	Efficiency ratio - taxable equivalent - non-GAAP		62.83	%		67.33	%		65.57	%		64.50	%		68.71	%
E / F	Noninterest income as a percentage of taxable equivalent operating revenue - non-GAAP		19.61	%		20.42	%		22.66	%		22.91	%		20.44	%

Pre-tax, Adjusted Earnings (PTAE) is a non-GAAP measure and is calculated as net income adjusted on a taxable equivalent basis less provisions for income taxes and loan losses and further adjusted to exclude gains and losses on securities, other assets and OREO. To calculate taxable equivalent net income, the interest earned on tax exempt loans and investment securities has been adjusted to reflect the amount that would have been earned had these investments been subject to normal income taxation. The Company believes that PTAE is a useful financial measure that enables investors and others to assess the Company's ability to generate capital to cover credit losses and is a reflection of earnings generated by the core business. The following table is a reconciliation of PTAE to its most comparable GAAP measure.


	Three months ended June 30,				Change
(in thousands)	2017		2016		Amount		%
Net income - GAAP, adjusted for:	$	9,489	$	8,532	$	957	11.2	%
Taxable equivalent adjustment		2,056		1,874		182	9.7	%
Provision for income taxes		3,499		3,197		302	9.4	%
Provision for loan losses		673		(1,652)		2,325	140.7	%
Net (gain) loss on securities, other assets and other real estate owned		32		7		25	357.1	%
Pre-tax, Adjusted Earnings (PTAE) - non-GAAP	$	15,749	$	11,958	$	3,791	31.7	%

13 | Page

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