Ecb Bancorp (ECBE) 8-K Ecb Holds Annual Meeting – Reports 2008

Exhibit 99.1

PRESS RELEASE

April 15, 2008

CONTACT:	ECB Bancorp, Inc.
	Gary M. Adams/Chief Financial Officer
	(252) 925-5525
	(252) 925-3131 facsimile
	Gary.Adams@ecbbancorp.com

FOR IMMEDIATE RELEASE

ECB HOLDS ANNUAL MEETING – REPORTS 2008

FIRST QUARTER FINANCIAL RESULTS

ENGELHARD, NC – April 15, 2008 – At ECB Bancorp Inc.’s (NASDAQ: ECBE) (“ECB” or the “Company”) 2008 Annual Meeting held on April 15, 2008, the shareholders reelected three existing directors-J. Bryant Kittrell III of Greenville, B. Martelle Marshall and R.S. Spencer, Jr. of Engelhard – for new three-year terms. Spencer, who also serves as the Chairman of the Board, is the longest standing board member with 45 years of dedicated service to the organization. Also approved was the 2008 Omnibus Equity Plan which authorizes grants to the Company’s officers and employees. In addition, the appointment of Dixon Hughes PLLC as the Company’s independent public accountants for 2008 was ratified.

Arthur H. Keeney III, ECB’s President and Chief Executive Officer, presided over the meeting, which included a video presentation updating the shareholders on significant events during 2007. The video highlighted the Company’s 2007 financial results and discussed its continued service expansion into both new and existing markets, including three new offices in 2007. The Company currently has one branch under construction in the rapidly growing Brunswick County town of Leland which is expected to open this summer. Mr. Keeney also introduced T. Olin Davis, who was promoted to Chief Credit Officer in the beginning of 2007. Mr. Davis discussed today’s economic environment and The East Carolina Bank’s (the “Bank”) credit culture and quality. R.S. Spencer, Jr. also spoke, from his perspective as Chairman of the Board, of the many positive changes he has witnessed over the past four decades and his optimism for the Bank’s future.

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2008 FIRST QUARTER HIGHLIGHTS

• Net income for the three months ended March 31, 2008 increased 9.9% to $1,046,000 or $0.36 per diluted share which compares to net income of $952,000 or $0.33 for the three months ended March 31, 2007.

• Net interest income for the 2008 first quarter rose 1.4% to $5,020,000 from $4,953,000 a year ago.

• Consolidated assets increased 16.0% to $714,562,000 at March 31, 2008 from $616,042,000 at March 31, 2007.

• Loans increased 16.1% to $485,774,000 at March 31, 2008 from $418,308,000 at March 31, 2007.

• Deposits increased 10.5% to $555,591,000 at March 31, 2008 from $502,980,000 at March 31, 2007.

• Noninterest income increased $267,000 or 15.9% to $1,948,000 for the three months ended March 31, 2008 compared to $1,681,000 for the same period in 2007. This increase in noninterest income is primarily the result of a $386,000 distribution to ECB from Visa International’s recent initial public offering. As a member bank of Visa, we received these proceeds for the redemption of approximately 9,000 class B shares of common stock. Additionally, non-interest income in the first quarter of 2007 included a $240,000 non-recurring item relating to the recapture of the allowance for losses on unfunded loan commitments.

• Increased cash dividend by 4.3% to $0.73 per share on an annualized basis.

Arthur H. Keeney III, President and CEO stated: “The first quarter of 2008 exceeded our expectations in many respects, particularly loan demand. While loans at March 31, 2008 increased by 16.1% or $67,466,000 over March 31, 2007, loans increased by $31,576,000 or 7.0% from December 31, 2007 to March 31, 2008. Interestingly, this increase was spread fairly evenly throughout our coastal markets from the Virginia border to the South Carolina border. While deposit growth did not quite keep up with loan growth, it grew at a healthy 10.5% from March 31, 2007 to March 31, 2008.

“While we can’t conclude yet that the worst of this cautionary economy is over in eastern North Carolina, a few bright spots do appear to be emerging. Asset quality by any measurement continues to remain above average relative to our peer group, and our capital levels also remain above average. Our net charge-offs were $34,000 in the first quarter which translates to 0.03% of average loans (annualized) while our non-performing loans to period-end loans were 0.27%. Because of our continuing emphasis on asset quality, we continue to feel comfortable with our allowance for loan losses, which is .90% of total loans as of March 31, 2008.

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“Our 24^th branch, currently under construction in Leland, North Carolina (Brunswick County) is on schedule to open in late third quarter 2008. Our three branches (opened in mid-2007) in Greenville (Pitt County), Winterville (Pitt County) and Ocean Isle Beach (Brunswick County) are gaining momentum in their respective markets and we envision this continuing.

“The Company also took advantage of a steepening yield curve in the first quarter of 2008 and entered into a $30 million leveraged transaction (5 years duration) in order to increase the yield in our investment portfolio and enhance our interest rate margin (borrowed funds are used to buy higher yielding investment securities). We have also successfully employed this strategy on previous occasions over the past years when loan demand was slow and we had excess liquidity. We anticipate replacing these investment assets with higher yielding loans over time as these investments mature. Additionally, we continued with our previously announced (third quarter 2007) stock repurchase program (up to 5% or 146,000 shares of the Company’s outstanding common stock) in order to manage our capital in the best interests of our stockholders.

“We will continue to monitor our noninterest expenses closely as cost containment remains one of our principal goals, particularly during this time of margin compression. It should be noted, however, that our noninterest expenses were impacted in the first quarter of 2008 by $76,000 due to the resumption of premium payments into the FDIC insurance fund. This will be an ongoing expense for us and for almost all banks until future notice by the FDIC that certain premium statistical benchmarks have been reached by the agency on behalf of the banking industry.”

About ECB Bancorp, Inc.

ECB Bancorp, Inc. is a bank holding company, headquartered in Engelhard, North Carolina, whose wholly-owned subsidiary, The East Carolina Bank, is a state-chartered, independent community bank insured by the FDIC. The Bank provides a full range of financial services through its 23 offices covering eastern NC from Currituck to Ocean Isle Beach and Greenville to Hatteras. The Bank also provides mortgages, insurance services through the Bank’s licensed agents, and investment and brokerage services offered through a third-party broker-dealer. The Company’s common stock is listed on The Nasdaq Global Market under the symbol “ECBE.” More information can be obtained by visiting the Company’s web site atwww.ecbbancorp.com.

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“Safe Harbor Statement” Under

The Private Securities Litigation Reform Act of 1995

Statements in this Press Release relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, expectations or beliefs about future events or results, and other statements that are not descriptions of historical facts, may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in the Company’s reports filed with the Securities and Exchange Commission from time to time. Forward-looking statements may be identified by terms such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “forecasts”, “potential” or “continue,” or similar terms or the negative of these terms, or other statements concerning opinions or judgments of the Company’s management about future events.

Factors that could influence the accuracy of such forward-looking statements include, but are not limited to, the financial success or changing strategies of the Company’s customers, actions of government regulators, the level of market interest rates, weather and similar conditions, particularly the effect of hurricanes on the Company’s banking and operations facilities and on the Company’s customers and the communities in which it does business, changes in general economic conditions and the real estate values in our banking market (particularly changes that affect our loan portfolio), the abilities of our borrowers to repay their loans, and the values of loan collateral. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievements. All forward-looking statements attributable to the Company are expressly qualified in their entirety by the cautionary statements in this paragraph. The Company has no obligations, and does not intend, to update these forward-looking statements.

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See 3 pages of financial information attached.

ECB BANCORP, INC. AND SUBSIDIARY

Consolidated Balance Sheets

March 31, 2008, December 31, 2007 and March 31, 2007

(Dollars in thousands, except per share data)

	March 31, 2008			December 31, 2007*			March 31, 2007
	(unaudited)						(unaudited)
Assets
Non-interest bearing deposits and cash	$	13,604		$	16,303			17,047
Interest bearing deposits		3,075			925			883
Overnight investments		7,150			4,775			9,825
Total cash and cash equivalents		23,829			22,003			27,755
Investment securities
Available-for-sale, at market value (cost of $159,903, $126,616 and $131,078 at March 31, 2008, December 31, 2007 and March 31, 2007, respectively)		160,874			125,888			129,424
Loans		485,774			454,198			418,308
Allowance for loan losses		(4,379	)		(4,083	)		(5,103	)
Loans, net		481,395			450,115			413,205
Real estate and repossessions acquired in settlement of loans, net		121			66			266
Federal Home Loan Bank common stock, at cost		4309			2,382			1,257
Bank premises and equipment, net		24,916			24,450			24,249
Accrued interest receivable		4,522			4,456			4,107
Bank owned life insurance		8,119			8,030			7,813
Other assets		6,477			6,499			7,966
Total	$	714,562			643,889		$	616,042
Liabilities and Shareholders’ Equity
Deposits
Demand, noninterest bearing		90,026		$	95,596			93,452
Demand, interest bearing		99,841			103,347			91,180
Savings		18,478			18,492			19,226
Time		347,246			308,926			299,122
Total deposits		555,591			526,361			502,980
Accrued interest payable		2,956			2,525			2,694
Short-term borrowings		56,300			43,174			41,588
Long-term obligations		26,000			—			—
Other liabilities		5,917			4,988			4,959
Total liabilities		646,764			577,048			552,221
Shareholders’ equity
Common stock, par value $3.50 per share, authorized 10,000,000 shares; issued and outstanding 2,909,699, 2,920,769 and 2,921,992 at March 31, 2008, December 31, 2007 and March 31, 2007, respectively		10,145			10,184			10,188
Capital surplus		26,849			27,026			26,897
Retained earnings		30,227			30,099			27,773
Accumulated other comprehensive income (loss)		577			(468	)		(1,037	)
Total shareholders’ equity		67,798			66,841			63,821
Total	$	714,562		$	643,889		$	616,042

* Derived from audited consolidated financial statements.

ECB BANCORP, INC. AND SUBSIDIARY

Consolidated Income Statements

For three months ended March 31, 2008 and 2007

(Dollars in thousands, except per share data)

	Three months ended March 31,
	2008		2007
	(unaudited)		(unaudited)
Interest income:
Interest and fees on loans	$	8,007	$	8,110
Interest on investment securities:
Interest exempt from federal income taxes		334		302
Taxable interest income		1,259		1,109
Dividend income		64		18
Other Interest		70		277
Total interest income		9,734		9,816
Interest expense:
Deposits:
Demand accounts		296		401
Savings		23		24
Time		3,903		3,758
Short-term borrowings		443		680
Long-term obligations		49		—
Total interest expense		4,714		4,863
Net interest income		5,020		4,953
Provision for loan losses		330		390
Net interest income after provision for loan losses		4,690		4,563
Noninterest income:
Service charges on deposit accounts		796		770
Other service charges and fees		269		326
Mortgage origination brokerage fees		307		248
Net gain on sale of securities		75		—
Income from bank owned life insurance		89		72
Other operating income		412		265
Total noninterest income		1,948		1,681
Noninterest expenses:
Salaries		2,036		1,980
Retirement and other employee benefits		832		670
Occupancy		452		432
Equipment		422		499
Professional fees		210		306
Supplies		82		54
Telephone		177		132
FDIC Insurance		76		16
Other operating expenses		970		872
Total noninterest expenses		5,257		4,961
Income before income taxes		1,381		1,283
Income taxes		335		331
Net Income	$	1,046	$	952
Net income per share – basic	$	0.36	$	0.33
Net income per share – diluted	$	0.36	$	0.33
Weighted average shares outstanding - basic		2,911,620		2,894,067
Weighted average shares outstanding - diluted		2,913,142		2,911,899

ECB Bancorp, Inc. Supplemental Quarterly Financial Data (unaudited)

(Dollars in thousands, except per share data)

	3/31/2008			12/31/2007			09/30/2007			06/30/2007			03/31/2007
Income Statement Data:
Interest income	$	9,734		$	10,086		$	10,210		$	9,871		$	9,816
Interest expense		4,714			4,777			4,890			4,905			4,863
Net interest income		5,020			5,309			5,320			4,966			4,953
Provision for loan losses		330			—			—			(489	)		390
Net after provision expense		4,690			5,309			5,320			5,455			4,563
Noninterest income		1,948			1,338			1,582			1,585			1,681
Noninterest expense		5,257			4,857			5,285			5,241			4,961
Income before income taxes		1,381			1,790			1,617			1,799			1,283
Income taxes		335			522			282			542			331
Net Income	$	1,046		$	1,268		$	1,335		$	1,257		$	952
Per Share Data and Shares Outstanding:
Net income - basic	$	0.36		$	0.44		$	0.46		$	0.43		$	0.33
Net income - diluted		0.36			0.43			0.46			0.43			0.33
Cash dividends		0.1825			0.175			0.175			0.175			0.175
Book value at period end		23.31			22.88			22.36			21.71			21.84
Dividend payout ratio		50.69	%		39.77	%		38.04	%		40.70	%		53.03	%
Weighted-average number of common shares outstanding:
Basic		2,911,620			2,913,043			2,913,279			2,912,889			2,894,067
Diluted		2,913,142			2,919,625			2,919,190			2,922,143			2,911,899
Shares outstanding at period end		2,909,699			2,920,769			2,921,992			2,921,992			2,921,992
Balance Sheet Data:
Total assets	$	714,562		$	643,889		$	629,679		$	629,573		$	616,042
Loans - gross		485,774			454,198			440,340			436,610			418,308
Allowance for loan losses		4,379			4,083			4,351			4,475			5,103
Investment securities		160,874			125,888			124,581			125,413			129,424
Interest earning assets		661,182			588,168			568,097			570,164			559,697
Premises and equipment, net		24,916			24,450			24,693			24,594			24,249
Total deposits		555,591			526,361			527,368			518,285			502,980
Short-term borrowings		56,300			43,174			29,128			40,825			41,588
Long-term obligations		26,000			—			—			—			—
Shareholders’ equity		67,798			66,841			65,339			63,436			63,821
Selected Performance Ratios (annualized):
Return on average assets		0.62	%		0.80	%		0.85	%		0.82	%		0.62	%
Return on average shareholders’ equity		6.17	%		7.67	%		8.30	%		7.89	%		6.00	%
Net interest margin		3.40	%		3.78	%		3.83	%		3.69	%		3.71	%
Efficiency ratio		72.68	%		70.48	%		74.06	%		77.23	%		74.85	%
Asset Quality Ratios:
Nonperforming loans to period-end loans		0.27	%		0.10	%		0.06	%		0.30	%		0.04	%
Allowance for loan losses to period-end loans		0.90	%		0.90	%		0.99	%		1.02	%		1.22	%
Allowance for loan losses to nonperforming loans		336	%		877	%		1,738	%		341	%		3,074	%
Net charge-offs to average loans (annualized)		0.03	%		0.24	%		0.11	%		0.13	%		0.01	%
Capital Ratios:
Equity-to-assets ratio		9.49	%		10.38	%		10.38	%		10.08	%		10.36	%
Leverage Capital Ratio		10.02	%		10.66	%		10.61	%		10.68	%		10.52	%
Tier 1 Capital Ratio		12.07	%		12.94	%		12.87	%		12.80	%		13.03	%
Total Capital Ratio		12.86	%		13.72	%		13.71	%		13.67	%		14.05	%