SEATTLE, July 31 /PRNewswire-FirstCall/ -- First Sound Bank (OTC Bulletin Board: FSWA) today reported net income of $611 thousand for the quarter ending June 30, 2008, compared to $382 thousand in the second quarter of 2007. For the first six months of 2008, net income was $1.2 million, compared to $673 thousand in the first six months of 2007 -- an increase of 78.3 percent.

First Sound Bank's assets at quarter-end stood at $266.5 million, up $11.5 million or 4.5 percent from $255.0 million at the end of the first quarter. Second quarter loans, at $212.2 million, were up 1.1 percent from $209.9 million the previous quarter. Deposits rose 11.5 percent, from $183.2 million to $204.2 million. Non-interest bearing deposits, which comprised 16 percent of deposits, rose 8.0 percent -- from $30.1 million to $32.5 million.

First Sound Bank's net interest margin showed improvement over the previous quarter, increasing from 4.84 to 5.53 percent. As anticipated in the purchase of Puget Sound Leasing Company, Inc., the leasing company's higher- yielding fixed-rate leases have been instrumental in improving the bank's net interest margin.

Although First Sound Bank has experienced only minimal increases in non-performing credits, it has -- in response to the current economic environment -- raised its loan loss reserve to 1.39 percent of loans from a reserve of 1.08 percent in the prior quarter.

First Sound Bank completed its fourth year of operations in July 2008 with a continued strong capital base. GAAP capital stood at 14.8 percent, and Tier 1 capital at 11.78 percent, in the second quarter.

"Second quarter results are in line with our expectations in this difficult economic environment, and we are pleased with both the success of the integration of Puget Sound Leasing and the positive effects resulting from our March 1, 2008 acquisition," said First Sound Bank Chairman and CEO Don Hirtzel.

"We are particularly happy with the 11.5 percent increase in core deposits during the second quarter," said First Sound Bank President and COO Steve Shaughnessy. "The choice of our clients to move their deposits to First Sound is a testimony to the faith they have in the bank," he added.

First Sound Bank was founded in July 2004 with initial investor capital of $20 million -- at the time, the most equity ever raised by a de novo bank in the Northwest. In the fall of 2006, the bank raised an additional $11 million in capital. With $266 million in assets, First Sound Bank and its dedicated 104-person staff serve clients from its downtown Seattle office and its leasing company in Bellevue.

For a more detailed financial analysis, contact jgould@firstsoundbank.com

Certain statements in this press release, including statements regarding the anticipated development and expansion of First Sound Bank's business, and the intent, belief or current expectations of the company, its directors or its officers, are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.

About First Sound Bank

Seattle-based First Sound Bank offers customized banking for small- to medium-sized businesses, organizations, not-for-profits and professionals in the Puget Sound region. Founded by a team of veteran local banking executives, it is committed to delivering personalized service, convenient access and competitive rates to support the needs of the business community. The bank offers online banking at http://www.firstsoundbank.com plus an expansive banking network in the western U.S., as well as ATM banking throughout the country and abroad. On March 1, 2008, First Sound Bank purchased a majority of the assets of Puget Sound Leasing Company, Inc. -- a small-ticket, business-to-business leasing company with a prior 23-year history -- and established Puget Sound Leasing as a division of First Sound Bank.

SOURCE First Sound Bank