Cobiz Financial (COBZ) 8-K CoBiz Financial Announces Second Quarter 2015 Results

Exhibit 99.1

CoBiz Financial Announces Second Quarter 2015 Results

Denver -- CoBiz Financial Inc. (NASDAQ: COBZ), a financial services company with $3.2 billion in assets, announced net income available to common shareholders of $7.2 million for the second quarter of 2015, or $0.17 per diluted common share. Return on average assets for the second quarter of 2015 was 0.96% and return on average shareholders’ equity was 9.3% for the second quarter of 2015.

Financial Highlights – Second Quarter 2015

· Loans at June 30, 2015 increased $46.6 million from March 31, 2015, or 7.6% annualized, and $201.5 million, or 8.8%, from June 30, 2014.

· Deposits at June 30, 2015 increased $85.2 million from March 31, 2015, or 13.4% annualized, and $333.2 million, or 14.5%, from June 30, 2014.

· During the quarter, the Company completed an offering of $60 million of unsecured 5.625% fixed-to-floating rate subordinated notes due in 2030. The net proceeds of the offering will be used to redeem the $57.4 million of Senior Non-Cumulative Perpetual Preferred Stock issued in conjunction with the Company’s participation in the U.S. Treasury’s Small Business Lending Fund (SBLF) program.

Financial Summary

	Quarter ended (unaudited)										2Q15 change vs.
(in thousands, except per share amounts)	2Q15			1Q15			2Q14			1Q15				2Q14
Net interest income before provision	$	28,072		$	28,001		$	26,353		$	71	0.3	%	$	1,719	6.5	%
Provision for loan losses		1,057			(789)			(941)			1,846	234.0	%		1,998	212.3	%
Net interest income after provision		27,015			28,790			27,294			(1,775)	(6.2)	%		(279)	(1.0)	%
Total noninterest income		7,940			7,318			7,543			622	8.5	%		397	5.3	%
Total noninterest expense		24,359			25,363			22,507			(1,004)	(4.0)	%		1,852	8.2	%
Net income before income taxes		10,596			10,745			12,330			(149)	(1.4)	%		(1,734)	(14.1)	%
Provision for income taxes		3,213			3,342			4,180			(129)	(3.9)	%		(967)	(23.1)	%
Income from continuing operations		7,383			7,403			8,150			(20)	(0.3)	%		(767)	(9.4)	%
Discontinued operations, net of tax(1)		-			(71)			467			71	100.0	%		(467)	(100.0)	%
Net income		7,383			7,332			8,617			51	0.7	%		(1,234)	(14.3)	%
Preferred stock dividends		(144)			(143)			(143)			(1)	(0.7)	%		(1)	(0.7)	%
Net income available to common shareholders	$	7,239		$	7,189		$	8,474		$	50	0.7	%	$	(1,235)	(14.6)	%
Diluted earnings per common share	$	0.17		$	0.18		$	0.21		$	(0.01)	(3.4)	%	$	(0.04)	(19.8)	%
KEY RATIOS
Net interest margin		3.96	%		4.06	%		3.92	%
Efficiency ratio(2)		65.48	%		69.42	%		69.35	%
Return on average assets		0.96	%		0.98	%		1.19	%
Return on average shareholders' equity		9.26	%		9.51	%		11.86	%
Noninterest income as a percentage of operating revenues		21.26	%		20.05	%		21.66	%

(1) The Company discontinued the operations of its investment banking subsidiary, Green Manning & Bunch (GMB), as of March 31, 2015. GMB’s operations have been reported as discontinued operations for all periods presented throughout this earnings announcement.

(2) The efficiency ratio equals noninterest expense adjusted to exclude gains and losses on other real estate owned (OREO), other assets and investments, divided by 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.

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“I am pleased with our results this quarter,” said Chairman and CEO Steve Bangert. “After two years of benefiting from negative loan loss provisions, we returned to recognizing a more traditional provision expense while still posting solid returns.  I was also pleased with our success in gathering deposits, which has been a key priority for us over the last year and a half, with average deposits increasing nearly 15%, annualized, from the first quarter of 2015.” 

Loans

· Loans at June 30, 2015 were $2.5 billion, an increase of $46.6 million from March 31, 2015. From June 30, 2014, loans increased $201.5 million, or 8.8%.

· Loans increased $31.5 million for Arizona and $15.1 million for Colorado from March 31, 2015. 

	Quarter ended (unaudited)							2Q15 change vs.
(in thousands)	2Q15		1Q15		2Q14		1Q15				2Q14
LOANS
Commercial	$	1,100,416	$	1,034,189	$	917,494	$	66,227	6.4	%	$	182,922	19.9	%
Owner-occupied real estate		435,921		427,838		497,945		8,083	1.9	%		(62,024)	(12.5)	%
Investor real estate		499,002		546,947		480,454		(47,945)	(8.8)	%		18,548	3.9	%
Construction & land		203,262		179,749		160,452		23,513	13.1	%		42,810	26.7	%
Consumer		212,730		213,543		194,339		(813)	(0.4)	%		18,391	9.5	%
Other		44,782		47,276		43,960		(2,494)	(5.3)	%		822	1.9	%
Total loans	$	2,496,113	$	2,449,542	$	2,294,644	$	46,571	1.9	%	$	201,469	8.8	%

· New credit extensions during the second quarter of 2015 improved from the first quarter of 2015 (linked-quarter). However, the Company continued to experience a high level of paydowns and maturities, particularly within the commercial real estate portfolio. 

· Commercial line utilization was 36.3% at June 30, 2015, compared to 36.9% and 39.5%, respectively, at the linked- and prior-year quarter ends.

	Quarter ended (unaudited)
(in thousands)	2Q15		1Q15		4Q14		3Q14		2Q14
Loans - beginning balance	$	2,449,542	$	2,405,575	$	2,357,069	$	2,294,644	$	2,152,294
New credit extended		197,340		151,539		177,247		146,458		201,805
Credit advanced		114,932		105,157		100,921		106,011		117,203
Paydowns & maturities		(265,459)		(211,937)		(228,914)		(189,822)		(175,311)
Gross loan charge-offs		(242)		(792)		(748)		(222)		(1,347)
Loans - ending balance	$	2,496,113	$	2,449,542	$	2,405,575	$	2,357,069	$	2,294,644
Net change - loans outstanding	$	46,571	$	43,967	$	48,506	$	62,425	$	142,350

Deposits and Customer Repurchase Agreements (Customer Funding, which excludes brokered CDs)

· Customer Funding at June 30, 2015 increased $84.7 million from the linked-quarter end and $337.0 million from the prior-year quarter end.

· Noninterest-bearing demand accounts declined by $5.4 million from the linked-quarter end and were 40.1% of total deposits at June 30, 2015.   

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	Quarter ended (unaudited)							2Q15 change vs.
(in thousands)	2Q15		1Q15		2Q14		1Q15				2Q14
DEPOSITS AND CUSTOMER REPURCHASE AGREEMENTS
Money market	$	770,076	$	687,199	$	599,234	$	82,877	12.1	%	$	170,842	28.5	%
Interest-bearing demand		618,272		589,401		491,347		28,871	4.9	%		126,925	25.8	%
Savings		19,384		16,811		15,134		2,573	15.3	%		4,250	28.1	%
Certificates of deposits under $100		22,487		23,405		25,704		(918)	(3.9)	%		(3,217)	(12.5)	%
Certificates of deposits $100 and over		105,111		113,030		126,487		(7,919)	(7.0)	%		(21,376)	(16.9)	%
Brokered CDs		-		-		19,996		-	-	%		(19,996)	(100.0)	%
Reciprocal CDARS		42,424		57,317		60,651		(14,893)	(26.0)	%		(18,227)	(30.1)	%
Total interest-bearing deposits		1,577,754		1,487,163		1,338,553		90,591	6.1	%		239,201	17.9	%
Noninterest-bearing demand deposits		1,054,632		1,060,054		960,600		(5,422)	(0.5)	%		94,032	9.8	%
Customer repurchase agreements		58,328		58,814		74,565		(486)	(0.8)	%		(16,237)	(21.8)	%
Total deposits and customer repurchase agreements	$	2,690,714	$	2,606,031	$	2,373,718	$	84,683	3.2	%	$	316,996	13.4	%

Allowance for Loan and Credit Losses (Allowance) and Credit Quality

· Nonperforming assets were $9.9 million at June 30, 2015, compared to $11.9 million at March 31, 2015, and $12.1 million at June 30, 2014. 

· After 13 consecutive quarters of provision reversals, the Company recorded a provision expense of $1.1 million in the second quarter of 2015 as a result of loan growth and an increase in classified loans driven primarily by the downgrade in one credit.

· The resulting Allowance was 1.36% of total loans at June 30, 2015.

	Quarter ended (unaudited)
(in thousands)	2Q15			1Q15			2Q14
ALLOWANCE FOR LOAN AND CREDIT LOSSES
Beginning allowance for loan losses	$	32,502		$	32,765		$	35,603
Provision for loan losses		1,057			(789)			(941)
Net recovery (charge-off)		273			526			(740)
Ending allowance for loan losses	$	33,832		$	32,502		$	33,922
CREDIT QUALITY
Nonaccrual loans	$	4,075		$	6,088		$	7,861
Loans 90 days or more past due and accruing interest		-			-			134
Total nonperforming loans		4,075			6,088			7,995
OREO and repossessed assets		5,786			5,786			4,148
Total nonperforming assets	$	9,861		$	11,874		$	12,143
Performing renegotiated loans	$	29,806		$	27,139		$	24,033
Classified loans	$	46,277		$	36,792		$	41,357
ASSET QUALITY MEASURES
Nonperforming assets to total assets		0.31	%		0.38	%		0.40	%
Nonperforming loans to total loans		0.16	%		0.25	%		0.35	%
Nonperforming loans and OREO to total loans and OREO		0.39	%		0.48	%		0.53	%
Allowance for loan and credit losses to total loans		1.36	%		1.33	%		1.48	%
Allowance for loan and credit losses to nonperforming loans		830.23	%		533.87	%		424.29	%

Shareholders’ Equity and Long-Term Debt 

· On June 25, 2015, the Company issued $60 million of unsecured fixed-to-floating rate subordinated notes due in 2030 (Notes). Unless redeemed, the Notes will bear 5.625% annual interest until June 25, 2025, and thereafter until maturity in June 2030 at a floating rate equal to 3-month LIBOR plus 317 basis points.

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· The Company intends to use the net proceeds of the Notes offering to redeem the outstanding SBLF preferred stock, currently included in Tier 1 capital, in July 2015 subject to regulatory approval. As the Notes will qualify as Tier 2 capital, total regulatory capital on a proforma basis after giving effect to the issuance of the Notes and redemption of the SBLF preferred stock as of March 31, 2015 (ratios as of June 30, 2015 are unavailable at the time of release) will not change significantly; however, the Company’s Tier 1 capital ratio will decline 2.1% to 11.0%.

· On July 16, 2015, the Board of Directors of the Company declared a quarterly cash dividend of $0.045 per common share. The dividend will be paid on August 3, 2015 to shareholders of record on July 27, 2015.

	Quarter ended (unaudited)
(in thousands, except per share amounts)	2Q15			1Q15			2Q14
EQUITY MEASURES
Common shareholders' equity	$	265,307		$	258,291		$	238,760
Total shareholders' equity		322,645			315,629			296,098
Common shares outstanding at period end		41,028			40,988			40,642
Book value per common share	$	6.47		$	6.30		$	5.87
Tangible book value per common share *	$	6.41		$	6.24		$	5.81
Tangible common equity to tangible assets *		8.32	%		8.29	%		7.82	%
Tangible equity to tangible assets *		10.13	%		10.14	%		9.71	%
Tier 1 capital ratio		**			13.14	%		14.18	%
Total-risk based capital ratio		**			14.11	%		15.43	%

* See accompanying Reconciliation of Non-GAAP measures to GAAP

** Ratios unavailable at the time of release.

Net Interest Income and Margin

· Net interest income on a tax-equivalent basis was $29.4 million for the second quarter of 2015, an increase of $0.2 million from the linked-quarter.

· Net Interest Margin (NIM) contracted ten basis points on a linked-quarter basis to 3.96%.

o Positively affecting net interest income and the NIM during the last couple of quarters were past-due interest collected on problem loan resolutions and prepayment penalties, which were particularly pronounced in the first quarter of 2015.

· From March 31, 2015, average loans increased $58.4 million while average federal funds sold, interest-earning deposits and investments increased $0.5 million.

· Average deposits increased $92.9 million from the linked-quarter end, with average noninterest-bearing deposits having a seasonal decrease of $12.1 million from the linked-quarter end.

Noninterest Income

· The Company has decided to focus on fee-based business lines with recurring revenue, and as of March 31, 2015 ceased offering investment banking services. The operations of GMB have been reported as discontinued operations retrospectively for all periods presented.

· Total noninterest income increased $0.6 million to $7.9 million from the linked- quarter, primarily due to an increase in insurance revenue and income from equity method investments.

· Noninterest income increased $0.4 million from the prior year quarter, primarily due to insurance fees.

· Noninterest income as a percentage of operating revenues was 21.3% for the second quarter of 2015, as compared to 20.1% and 21.7%, respectively, for the linked- and prior-year quarters.

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	Quarter ended (unaudited)							2Q15 change vs.
(in thousands)	2Q15		1Q15		2Q14		1Q15				2Q14
Noninterest income:
Deposit service charges	$	1,455	$	1,493	$	1,394	$	(38)	(2.5)	%	$	61	4.4	%
Investment advisory income		1,471		1,495		1,442		(24)	(1.6)	%		29	2.0	%
Insurance income		3,137		2,950		2,894		187	6.3	%		243	8.4	%
Other income		1,877		1,380		1,813		497	36.0	%		64	3.5	%
Total noninterest income	$	7,940	$	7,318	$	7,543	$	622	8.5	%	$	397	5.3	%

Operating Expenses

· Total noninterest expense decreased $1.0 million from the linked-quarter and increased by $1.9 million from the prior-year quarter.

· The decrease in noninterest expense over the linked-quarter is primarily related to compensation-related expenses, which are typically higher in the first quarter. 

o Total full-time equivalent employees at June 30, 2015 were unchanged from March 31, 2015 at 529, versus 510 at June 30, 2014.

· The increase in noninterest expense over the prior-year quarter is primarily related to investments in new personnel and annual merit increases. In addition, the prior-year quarter benefited from net gains on OREO and other assets of $1.6 million, which reduced total noninterest expenses.

· The efficiency ratio was 65.5% for the second quarter of 2015, as compared to 69.4% and 69.3%, respectively, for the linked- and prior-year quarters.

	Quarter ended (unaudited)							2Q15 change vs.
(in thousands)	2Q15		1Q15		2Q14		1Q15				2Q14
Noninterest expense:
Salaries and employee benefits	$	16,216	$	16,975	$	15,430	$	(759)	(4.5)	%	$	786	5.1	%
Stock-based compensation expense		739		1,165		711		(426)	(36.6)	%		28	3.9	%
Occupancy expenses, premises and equipment		3,258		3,149		3,387		109	3.5	%		(129)	(3.8)	%
Amortization of intangibles		150		150		149		-	-	%		1	0.7	%
Other operating expenses		4,091		3,893		4,476		198	5.1	%		(385)	(8.6)	%
Net (gain) loss on OREO, repossessed assets and other		(95)		31		(1,646)		(126)	(406.5)	%		1,551	94.2	%
Total noninterest expense	$	24,359	$	25,363	$	22,507	$	(1,004)	(4.0)	%	$	1,852	8.2	%

Earnings Conference Call

In conjunction with this release, you are invited to listen to the Company's conference call on Friday, July 17, 2015, at 9:00 am MDT with Steve Bangert, chairman and CEO of CoBiz Financial Inc. The call can be accessed via the Internet at http://www.videonewswire.com/event.asp?id=102565 or by telephone at 877.493.9121, (conference ID # 69215425). International callers may dial:  973.582.2750.

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. We believe these measures provide important supplemental information to investors. 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

About CoBiz Financial

CoBiz Financial (NASDAQ:COBZ) is a $3.2 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.

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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, 2015

(unaudited)

	Three months ended June 30,				Six months ended June 30,
(in thousands, except per share amounts)	2015		2014		2015			2014
INCOME STATEMENT DATA
Interest income	$	30,044	$	28,510	$	60,008		$	55,501
Interest expense		1,972		2,157		3,935			4,243
NET INTEREST INCOME BEFORE PROVISION		28,072		26,353		56,073			51,258
Provision for loan losses		1,057		(941)		268			(2,829)
NET INTEREST INCOME AFTER PROVISION		27,015		27,294		55,805			54,087
Noninterest income		7,940		7,543		15,258			13,037
Noninterest expense		24,359		22,507		49,722			45,916
INCOME BEFORE INCOME TAXES		10,596		12,330		21,341			21,208
Provision for income taxes		3,213		4,180		6,555			7,230
NET INCOME FROM CONTINUING OPERATIONS		7,383		8,150		14,786			13,978
Income (loss) from discontinued operations, net of tax		-		467		(71)			156
NET INCOME	$	7,383	$	8,617	$	14,715		$	14,134
Preferred stock dividends		(144)		(143)		(287)			(286)
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$	7,239	$	8,474	$	14,428		$	13,848
EARNINGS PER COMMON SHARE
BASIC	$	0.17	$	0.21	$	0.35		$	0.34
DILUTED	$	0.17	$	0.21	$	0.35		$	0.34
EQUITY MEASURES
Common shares outstanding at period end (in thousands)						41,028			40,642
Book value per common share					$	6.47		$	5.87
Tangible book value per common share *					$	6.41		$	5.81
Tangible common equity to tangible assets *						8.32	%		7.82	%
Tangible equity to tangible assets *						10.13	%		9.71	%
* See accompanying Reconciliation of Non-GAAP Measures to GAAP
PERIOD END BALANCES
Total assets					$	3,166,092		$	3,024,832
Investments						493,292			526,797
Loans						2,496,113			2,294,644
Intangible assets						2,226			2,498
Deposits						2,632,386			2,299,153
Subordinated debentures						131,159			72,166
Common shareholders' equity						265,307			238,760
Total shareholders' equity						322,645			296,098
Interest-earning assets						3,008,533			2,885,380
Interest-bearing liabilities						1,767,240			1,745,284
BALANCE SHEET AVERAGES
Average assets					$	3,057,453		$	2,855,919
Average investments						485,156			543,815
Average loans						2,438,508			2,173,000
Average deposits						2,542,304			2,272,169
Average subordinated debentures						74,122			72,166
Average shareholders' equity						316,230			288,017
Average interest-earning assets						2,945,871			2,735,285
Average interest-bearing liabilities						1,698,115			1,570,112

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CoBiz Financial Inc.

June 30, 2015

(unaudited)

	Three months ended June 30,						Six months ended June 30,
(in thousands)	2015			2014			2015			2014
PROFITABILITY MEASURES
Net interest margin		3.96	%		3.92	%		4.01	%		3.91	%
Efficiency ratio - tax equivalent		65.48	%		69.35	%		67.43	%		72.25	%
Return on average assets		0.96	%		1.19	%		0.97	%		1.00	%
Return on average shareholders' equity		9.26	%		11.86	%		9.38	%		9.90	%
Noninterest income as a percentage of operating revenues		21.26	%		21.66	%		20.66	%		19.73	%
CREDIT QUALITY
Nonperforming loans
Nonaccrual loans							$	4,075		$	7,861
Loans 90 days or more past due and accruing interest								-			134
Total nonperforming loans								4,075			7,995
OREO & repossessed assets								5,786			4,148
Total nonperforming assets							$	9,861		$	12,143
Performing renegotiated loans							$	29,806		$	24,033
Classified loans							$	46,277		$	41,357
Charge-offs							$	(1,034)		$	(1,547)
Recoveries								1,833			1,248
Net charge-offs							$	799		$	(299)
Nonperforming assets to total assets								0.31	%		0.40	%
Nonperforming loans to total loans								0.16	%		0.35	%
Nonperforming loans and OREO to total loans and OREO								0.39	%		0.53	%
Allowance for loan and credit losses to total loans								1.36	%		1.48	%
Allowance for loan and credit losses to nonperforming loans								830.23	%		424.29	%

										Total		NPAs as a
NONPERFORMING ASSETS BY MARKET	Colorado			Arizona			Total			in Category		%
Commercial	$	2,242		$	539		$	2,781		$	1,100,416	0.25	%
Real estate - mortgage		369			744			1,113			934,923	0.12	%
Construction & land		29			-			29			203,262	0.01	%
Consumer		152			-			152			212,730	0.07	%
Other loans		-			-			-			44,782	-	%
OREO & repossessed assets		5,491			295			5,786			5,786	-
NPAs	$	8,283		$	1,578		$	9,861		$	2,501,899	0.39	%
Total loans	$	1,744,418		$	751,695		$	2,496,113
Total loans and OREO		1,749,909			751,990			2,501,899
Nonperforming loans to loans		0.16	%		0.17	%		0.16	%
Nonperforming loans and OREO to total loans and OREO		0.47	%		0.21	%		0.39	%

8 | Page

CoBiz Financial Inc.

June 30, 2015

(unaudited)

	Three months ended
	June 30,			March 31,			December 31,			September 30,			June 30,
(in thousands, except per share amounts)	2015			2015			2014			2014			2014
Interest income	$	30,044		$	29,964		$	29,611		$	29,205		$	28,510
Interest expense		1,972			1,963			2,043			2,143			2,157
Net interest income before provision		28,072			28,001			27,568			27,062			26,353
Provision for loan losses		1,057			(789)			(874)			(452)			(941)
Net interest income after provision		27,015			28,790			28,442			27,514			27,294
Noninterest income:
Deposit service charges	$	1,455		$	1,493		$	1,404		$	1,424		$	1,394
Investment advisory income		1,471			1,495			1,454			1,418			1,442
Insurance income		3,137			2,950			2,872			2,622			2,894
Other income		1,877			1,380			1,762			1,916			1,813
Total noninterest income		7,940			7,318			7,492			7,380			7,543
Noninterest expense:
Salaries and employee benefits	$	16,216		$	16,975		$	16,618		$	15,513		$	15,430
Stock-based compensation expense		739			1,165			712			704			711
Occupancy expenses, premises and equipment		3,258			3,149			3,358			3,258			3,387
Amortization of intangibles		150			150			150			147			149
Other operating expenses		4,091			3,893			4,229			4,298			4,476
Net (gain) loss on securities, other assets and OREO		(95)			31			(169)			(598)			(1,646)
Total noninterest expense		24,359			25,363			24,898			23,322			22,507
Net income before income taxes		10,596			10,745			11,036			11,572			12,330
Provision for income taxes		3,213			3,342			3,749			4,039			4,180
Net income from continuing operations		7,383			7,403			7,287			7,533			8,150
Net income (loss) from discontinuing operations		-			(71)			(305)			358			467
Net income		7,383			7,332			6,982			7,891			8,617
Preferred stock dividends		(144)			(143)			(144)			(144)			(143)
Net income available to common shareholders	$	7,239		$	7,189		$	6,838		$	7,747		$	8,474
Earnings per common share
Basic	$	0.17		$	0.18		$	0.17		$	0.19		$	0.21
Diluted	$	0.17		$	0.18		$	0.17		$	0.19		$	0.21
PROFITABILITY MEASURES
Net interest margin		3.96	%		4.06	%		3.94	%		3.90	%		3.92	%
Efficiency ratio - tax equivalent		65.48	%		69.42	%		69.63	%		67.39	%		69.35	%
Return on average assets		0.96	%		0.98	%		0.92	%		1.05	%		1.19	%
Return on average shareholders' equity		9.26	%		9.51	%		9.05	%		10.46	%		11.86	%
Noninterest income as a percentage of operating revenues		21.26	%		20.05	%		20.79	%		20.79	%		21.66	%
EQUITY MEASURES
Common shares outstanding at period end (in thousands)		41,028			40,988			40,770			40,691			40,642
Diluted weighted average common shares outstanding (in thousands)		40,742			40,456			40,374			40,228			40,134
Book value per common share	$	6.47		$	6.30		$	6.17		$	6.03		$	5.87
Tangible book value per common share *	$	6.41		$	6.24		$	6.11		$	5.96		$	5.81
Tangible common equity to tangible assets *		8.32	%		8.29	%		8.14	%		8.02	%		7.82	%
Tangible equity to tangible assets *		10.13	%		10.14	%		10.01	%		9.92	%		9.71	%
Tier 1 capital ratio		**			13.14	%		14.42	%		14.46	%		14.18	%
Total risk based capital ratio		**			14.11	%		15.67	%		15.71	%		15.43	%

* See accompanying Reconciliation of Non-GAAP Measures to GAAP

** Ratios unavailable at the time of release.

9 | Page

CoBiz Financial Inc.

June 30, 2015

(unaudited)

	At
	June 30,			March 31,			December 31,			September 30,			June 30,
(in thousands)	2015			2015			2014			2014			2014
PERIOD END BALANCES
Total assets	$	3,166,092		$	3,090,226		$	3,062,166		$	3,028,864		$	3,024,832
Investments		493,292			488,186			484,621			500,526			526,797
Loans		2,496,113			2,449,542			2,405,575			2,357,069			2,294,644
Intangible assets		2,226			2,376			2,526			2,676			2,498
Deposits		2,632,386			2,547,217			2,492,291			2,366,376			2,299,153
Subordinated debentures		131,159			72,166			72,166			72,166			72,166
Common shareholders' equity		265,307			258,291			251,431			245,392			238,760
Total shareholders' equity		322,645			315,629			308,769			302,730			296,098
Interest-earning assets		3,008,533			2,945,276			2,927,132			2,892,095			2,885,380
Interest-bearing liabilities		1,767,240			1,691,143			1,653,738			1,698,415			1,745,284
LOANS
Commercial	$	1,100,416		$	1,034,189		$	977,699		$	962,438		$	917,494
Real estate - mortgage		934,923			974,785			989,719			964,100			978,399
Construction & land		203,262			179,749			181,864			182,288			160,452
Consumer		212,730			213,543			207,955			202,414			194,339
Other		44,782			47,276			48,338			45,829			43,960
Gross loans		2,496,113			2,449,542			2,405,575			2,357,069			2,294,644
Less allowance for loan losses		(33,832)			(32,502)			(32,765)			(33,682)			(33,922)
Total net loans	$	2,462,281		$	2,417,040		$	2,372,810		$	2,323,387		$	2,260,722
Gross Loans - Colorado		1,744,418			1,729,317			1,732,453			1,717,764			1,683,720
Gross Loans - Arizona		751,695			720,225			673,122			639,305			610,924
DEPOSITS AND CUSTOMER REPURCHASE AGREEMENTS
Money market	$	770,076		$	687,199		$	661,519		$	619,377		$	599,234
Interest-bearing demand		618,272			589,401			531,365			509,352			491,347
Savings		19,384			16,811			15,236			19,091			15,134
Certificates of deposits under $100		22,487			23,405			24,184			24,971			25,704
Certificates of deposits $100 and over		105,111			113,030			122,216			127,054			126,487
Brokered CDs		-			-			-			-			19,996
Reciprocal CDARS		42,424			57,317			64,607			64,610			60,651
Total interest-bearing deposits		1,577,754			1,487,163			1,419,127			1,364,455			1,338,553
Noninterest-bearing demand deposits		1,054,632			1,060,054			1,073,164			1,001,921			960,600
Customer repurchase agreements		58,328			58,814			49,976			76,041			74,565
Total deposits and customer repurchase agreements	$	2,690,714		$	2,606,031		$	2,542,267		$	2,442,417		$	2,373,718
BALANCE SHEET AVERAGES
Average assets	$	3,076,682		$	3,038,010		$	3,003,084		$	2,983,493		$	2,913,504
Average investments		483,867			486,460			491,764			512,579			536,450
Average loans		2,467,522			2,409,171			2,360,469			2,327,777			2,236,728
Average deposits		2,588,477			2,495,616			2,450,685			2,351,330			2,267,573
Average subordinated debentures		76,056			72,166			72,166			72,166			72,166
Average shareholders' equity		319,664			312,757			306,226			299,404			291,469
Average interest-earning assets		2,975,133			2,916,283			2,877,329			2,860,327			2,792,091
Average interest-bearing liabilities		1,729,251			1,666,630			1,624,211			1,684,757			1,654,752
ALLOWANCE FOR LOAN AND CREDIT LOSSES
Beginning allowance for loan losses	$	32,502		$	32,765		$	33,682		$	33,922		$	35,603
Provision for loan losses		1,057			(789)			(874)			(452)			(941)
Net recovery (charge-off)		273			526			(43)			212			(740)
Ending allowance for loan losses	$	33,832		$	32,502		$	32,765		$	33,682		$	33,922
CREDIT QUALITY
Nonperforming loans
Nonaccrual loans	$	4,075		$	6,088		$	8,994		$	8,273		$	7,861
Loans 90 days or more past due and accruing interest		-			-			161			-			134
Total nonperforming loans		4,075			6,088			9,155			8,273			7,995
OREO and repossessed assets		5,786			5,786			5,819			3,750			4,148
Total nonperforming assets	$	9,861		$	11,874		$	14,974		$	12,023		$	12,143
Performing renegotiated loans	$	29,806		$	27,139		$	27,275		$	29,121		$	24,033
Classified loans	$	46,277		$	36,792		$	36,940		$	36,534		$	41,357
ASSET QUALITY MEASURES
Nonperforming assets to total assets		0.31	%		0.38	%		0.49	%		0.40	%		0.40	%
Nonperforming loans to total loans		0.16	%		0.25	%		0.38	%		0.35	%		0.35	%
Nonperforming loans and OREO to total loans and OREO		0.39	%		0.48	%		0.62	%		0.51	%		0.53	%
Allowance for loan and credit losses to total loans		1.36	%		1.33	%		1.36	%		1.43	%		1.48	%
Allowance for loan and credit losses to nonperforming loans		830.23	%		533.87	%		357.89	%		407.13	%		424.29	%

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CoBiz Financial Inc.

June 30, 2015

(unaudited)

	For the three months ended,
	June 30, 2015							March 31, 2015							June 30, 2014
				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	$	23,744		$	15	0.25	%	$	20,652		$	12	0.23	%	$	18,913		$	24	0.50	%
Investment securities		483,867			3,350	2.77	%		486,460			3,527	2.90	%		536,450			4,123	3.07	%
Loans		2,467,522			28,014	4.49	%		2,409,171			27,597	4.58	%		2,236,728			25,296	4.47	%
Total interest-earning assets	$	2,975,133		$	31,379	4.18	%	$	2,916,283		$	31,136	4.27	%	$	2,792,091		$	29,443	4.18	%
Noninterest-earning assets		101,549							121,727							121,413
Total assets	$	3,076,682						$	3,038,010						$	2,913,504
Liabilities and Shareholders' Equity
Deposits
Money market	$	738,879		$	514	0.28	%	$	681,749		$	489	0.29	%	$	586,439		$	465	0.32	%
Interest-bearing demand		622,334			200	0.13	%		560,906			194	0.14	%		493,768			236	0.19	%
Savings		18,097			2	0.04	%		16,127			2	0.05	%		14,389			2	0.06	%
Certificates of deposit
Reciprocal		52,391			31	0.24	%		56,554			34	0.24	%		66,721			55	0.33	%
Under $100		23,008			23	0.40	%		23,739			24	0.41	%		27,693			29	0.42	%
$100 and over		109,321			142	0.52	%		120,002			151	0.51	%		131,292			171	0.52	%
Total interest-bearing deposits	$	1,564,030		$	912	0.23	%	$	1,459,077		$	894	0.25	%	$	1,320,302		$	958	0.29	%
Other borrowings
Securities sold under agreements to repurchase		61,626			9	0.06	%		54,707			10	0.07	%		79,615			44	0.22	%
Other short-term borrowings		27,539			19	0.27	%		80,680			51	0.25	%		182,669			127	0.28	%
Long term-debt		76,056			1,032	5.37	%		72,166			1,008	5.59	%		72,166			1,028	5.64	%
Total interest-bearing liabilities	$	1,729,251		$	1,972	0.45	%	$	1,666,630		$	1,963	0.47	%	$	1,654,752		$	2,157	0.52	%
Noninterest-bearing demand accounts		1,024,447							1,036,539							947,271
Total deposits and interest-bearing liabilities		2,753,698							2,703,169							2,602,023
Other noninterest-bearing liabilities		3,320							22,084							20,012
Total liabilities		2,757,018							2,725,253							2,622,035
Total equity		319,664							312,757							291,469
Total liabilities and equity	$	3,076,682						$	3,038,010						$	2,913,504
Net interest income - taxable equivalent				$	29,407						$	29,173						$	27,286
Net interest spread						3.73	%						3.80	%						3.66	%
Net interest margin						3.96	%						4.06	%						3.92	%
Ratio of average interest-earning assets to average interest-bearing liabilities		172.05	%						174.98	%						168.73	%

11 | Page

	For the six months ended June 30,
	2015							2014
				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	$	22,207		$	27	0.24	%	$	18,470		$	48	0.52	%
Investment securities		485,156			6,877	2.83	%		543,815			8,381	3.08	%
Loans		2,438,508			55,611	4.54	%		2,173,000			48,858	4.47	%
Total interest-earning assets	$	2,945,871		$	62,515	4.22	%	$	2,735,285		$	57,287	4.17	%
Noninterest-earning assets		111,582							120,634
Total assets	$	3,057,453						$	2,855,919
Liabilities and Shareholders' Equity
Deposits
Money market	$	710,472		$	1,003	0.28	%	$	584,814		$	929	0.32	%
Interest-bearing demand		591,790			394	0.13	%		462,030			481	0.21	%
Savings		17,118			4	0.05	%		13,497			4	0.06	%
Certificates of deposit
Reciprocal		54,461			65	0.24	%		74,852			123	0.33	%
Under $100		23,371			47	0.41	%		27,641			59	0.43	%
$100 and over		114,632			293	0.52	%		133,976			349	0.53	%
Total interest-bearing deposits	$	1,511,844		$	1,806	0.24	%	$	1,296,810		$	1,945	0.30	%
Other borrowings
Securities sold under agreements to repurchase		58,186			19	0.06	%		92,005			107	0.23	%
Other short-term borrowings		53,963			70	0.26	%		109,131			147	0.27	%
Long term-debt		74,122			2,040	5.47	%		72,166			2,044	5.63	%
Total interest-bearing liabilities	$	1,698,115		$	3,935	0.46	%	$	1,570,112		$	4,243	0.54	%
Noninterest-bearing demand accounts		1,030,460							975,359
Total deposits and interest-bearing liabilities		2,728,575							2,545,471
Other noninterest-bearing liabilities		12,648							22,431
Total liabilities		2,741,223							2,567,902
Total equity		316,230							288,017
Total liabilities and equity	$	3,057,453						$	2,855,919
Net interest income - taxable equivalent				$	58,580						$	53,044
Net interest spread						3.76	%						3.63	%
Net interest margin						4.01	%						3.91	%
Ratio of average interest-earning assets to average interest-bearing liabilities		173.48	%						174.21	%

12 | Page

CoBiz Financial Inc.

June 30, 2015

(unaudited)

Reconciliation of Non-GAAP Measures to GAAP

(in thousands, except per share amounts)

The Company believes these non-GAAP measures are useful to obtain an understanding of the operating results of the Company’s core business and reflects 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 tables include non-GAAP financial measures related to tangible equity, tangible common equity, tangible assets and net interest margin.  The tables below have been adjusted to exclude intangible assets, preferred stock, past due interest and prepayment penalties.

		At
		June 30,			March 31,			December 31,			September 30,			June 30,
		2015			2015			2014			2014			2014
	Shareholders' equity as reported - GAAP	$	322,645		$	315,629		$	308,769		$	302,730		$	296,098
	Intangible assets		(2,226)			(2,376)			(2,526)			(2,676)			(2,498)
A	Tangible equity - non-GAAP		320,419			313,253			306,243			300,054			293,600
	Preferred stock		(57,338)			(57,338)			(57,338)			(57,338)			(57,338)
B	Tangible common equity - non-GAAP	$	263,081		$	255,915		$	248,905		$	242,716		$	236,262
	Total assets as reported - GAAP	$	3,166,092		$	3,090,226		$	3,062,166		$	3,028,864		$	3,024,832
	Intangible assets		(2,226)			(2,376)			(2,526)			(2,676)			(2,498)
C	Total tangible assets - non-GAAP	$	3,163,866		$	3,087,850		$	3,059,640		$	3,026,188		$	3,022,334
D	Common shares outstanding		41,028			40,988			40,770			40,691			40,642
B / C	Tangible common equity to tangible assets - non-GAAP		8.32	%		8.29	%		8.14	%		8.02	%		7.82	%
A / C	Tangible equity to tangible assets - non-GAAP		10.13	%		10.14	%		10.01	%		9.92	%		9.71	%
B / D	Tangible book value per common share - non-GAAP	$	6.41		$	6.24		$	6.11		$	5.96		$	5.81

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