Information Concerning Bank Safety and FDIC Insurance from Heritage Oaks Bank

Dear Business First Bank Client,

Part of our daily commitment for the past 26 years is making sure we keep our clients informed and involved as it relates to their banking relationship with us.

We know there are many misperceptions about the banking industry right now, and that the news media concentrates on the troubles of large investment banks.

Let me assure you that all your deposits can be insured by the FDIC. The FDIC now gives all noninterest bearing transaction accounts unlimited FDIC insurance. In addition, your interest bearing accounts are insured by the FDIC up to $250,000.00 per depositor. Depending on the vesting of your accounts it is possible to insure deposits in excess of $250,000.00.

I have included the following link to the FDIC: http://www.fdic.gov/EDIE to help you determine what that coverage would be. We also have deposit products available which allow you to keep all of your liquid funds at Heritage Oaks Bank and still be fully insured.

Please know that we do not hold any mortgage loans in our loan portfolio that are of the nature or type which has led to the problems in some banking sectors. Neither did we hold any shares of FHLMC or FNMA, investments which have caused other banks to suffer liquidity problems.

Of greatest importance, we are a well-capitalized bank pursuant to regulatory standards. We operate a very conservative bank, which has produced profitability quarter after quarter for the past 20 years. You should also know that our bank’s stock price is a function of the market and has no direct link to our overall bank performance. The banking industry as a whole has seen a decrease in stock value over the past 12 months.

There is a reason our bank is the largest publically owned and operated community bank on the Central Coast. We serve the best interest of our clients and employees. These actions earn us your trust and respect which will enable us to grow and be YOUR community bank for another 26 years.

If you have questions please send them to info@businessfirst.com and we will get back to you with an answer.

Sincerely,

Larry Ward
President/CEO
Heritage Oaks Bank