FPB Bancorp 10QSB 2003 Q1 Quarterly report (small business)

FPB Bancorp (FPBI) Inactive 10QSB2003 Q1 Quarterly report (small business)

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

x Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2003

o Transition report under Section 13 or 15(d) of the Exchange Act

For the transition period from to

Commission File Number 000-33351

FPB BANCORP, INC.

(Exact Name of Small Business Issuer as Specified in Its Charter)


Florida		65-1147861

(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

1301 SE Port St. Lucie Boulevard
Port St. Lucie, Florida 34952

(Address of Principal Executive Offices)

(772) 398-1388

(Issuer’s Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:

YES þ NO o

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date:


Common stock, par value $.01 per share		817,775 shares

(class)		Outstanding at March 31, 2003

Transitional Small Business Format (check one): YES o NO þ

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION
	Item 1. Financial Statements
		Condensed Consolidated Balance Sheets
		Condensed Consolidated Statements of Earnings (Unaudited)
		Condensed Consolidated Statements of Stockholders’ Equity
		Condensed Consolidated Statements of Cash Flows (Unaudited)
		Notes to Condensed Consolidated Financial Statements (unaudited)
		Review by Independent Accountants
		Independent Accountant’s Report
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 3. Controls and Procedures
PART II. OTHER INFORMATION
	Item 1. Legal Proceedings
	Item 6. Exhibits and Reports on Form 8-K
PART II. OTHER INFORMATION
SIGNATURES
CERTIFICATIONS
Ex-99.1 CEO Certification
Ex-99.2 CFO Certification

FPB BANCORP, INC. AND SUBSIDIARY

INDEX


			Page

PART I. FINANCIAL INFORMATION
	Item 1. Financial Statements
		Condensed Consolidated Balance Sheets - March 31, 2003 (unaudited) and December 31, 2002		2
		Condensed Consolidated Statements of Earnings - Three Months ended March 31, 2003 and 2002 (unaudited)		3
		Condensed Consolidated Statements of Stockholders’ Equity - Three Months ended March 31, 2003 and 2002 (unaudited)		4
		Condensed Consolidated Statements of Cash Flows - Three Months ended March 31, 2003 and 2002 (unaudited)		5
		Notes to Condensed Consolidated Financial Statements (unaudited)		6-8
		Review By Independent Accountants		9
		Report on Review by Independent Accountants		10
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			11-14
	Item 3. Controls and Procedures			15
PART II. OTHER INFORMATION
	Item 1. Legal Proceedings			15
	Item 6. Exhibits and Reports on Form 8-K			15
SIGNATURES				16
CERTIFICATIONS				17-18

FPB BANCORP, INC. AND SUBSIDIARY

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Condensed Consolidated Balance Sheets

(Dollars in thousands)


				March 31,			December 31,
				2003			2002

				(unaudited)
Assets
Cash and due from banks				$	3,279			3,414
Interest-bearing deposits with banks					3,009			2,001
Federal funds sold					3,336			2,410

		Total cash and cash equivalents			9,624			7,825
Securities available for sale					5,565			6,272
Securities held to maturity					318			425
Loans, net of allowance for loan losses of $614 and $553					43,035			41,662
Premises and equipment, net					1,805			1,778
Federal Home Loan Bank stock, at cost					122			80
Accrued interest receivable					221			197
Deferred income taxes					356			356
Other assets					226			172

		Total assets		$	61,272			58,767

Liabilities and Stockholders’ Equity
Liabilities:
	Noninterest-bearing demand deposits				9,962			9,447
	Savings, NOW and money-market deposits				18,616			15,885
	Time deposits				24,722			24,933

			Total deposits		53,300			50,265
	Official checks				451			1,026
	Other liabilities				212			163

			Total liabilities		53,963			51,454

Stockholders’ equity:
	Preferred stock, $.01 par value; 1,000,000 shares authorized, no shares issued or outstanding				—			—
	Common stock, $.01 par value; 5,000,000 shares authorized, 817,775 shares issued and outstanding				8			8
	Additional paid-in capital				7,930			7,932
	Accumulated deficit				(640	)		(687	)
	Accumulated other comprehensive income				11			60

			Total stockholders’ equity		7,309			7,313

			Total liabilities and stockholders’ equity	$	61,272			58,767

See Accompanying Notes to Condensed Consolidated Financial Statements.

FPB BANCORP, INC. AND SUBSIDIARY

Condensed Consolidated Statements of Earnings (Unaudited)

(Dollars in thousands, except share amounts)


			Three Months Ended
			March 31,

			2003		2002

Interest income:
	Loans		$	745		644
	Securities			58		66
	Other			15		17

		Total interest income		818		727

Interest expense:
	Deposits			251		272
	Other			—		1

		Total interest expense		251		273

	Net interest income			567		454
		Provision for loan losses		83		55

Net interest income after provision for loan losses				484		399

Noninterest income:
	Service charges and fees on deposit accounts			53		49
	Other fees			6		3
	Gain on sale of securities available for sale			33		—
	Other			27		2

		Total noninterest income		119		54

Noninterest expenses:
	Salaries and employee benefits			214		196
	Occupancy and equipment			67		81
	Advertising			38		19
	Professional fees			57		28
	Data processing			53		39
	Other			97		75

		Total noninterest expenses		526		438

Earnings before income taxes				77		15
	Income taxes			30		7

Net earnings			$	47		8

Earnings per share, basic and diluted			$	.06		.02

Weighted-average number of shares, basic and diluted				817,775		489,410

Dividends per share			$	—		—

See Accompanying Notes to Condensed Consolidated Financial Statements.

FPB BANCORP, INC. AND SUBSIDIARY

Condensed Consolidated Statements of Stockholders’ Equity

Three Months Ended March 31, 2003 and 2002
(Dollars in thousands)


													Accumulated
													Other
													Compre-
			Common Stock				Additional						hensive			Total
							Paid-In			Accumulated			Income			Stockholders'
			Shares		Amount		Capital			Deficit			(Loss)			Equity

Balance at December 31, 2001				489,410	$	5		4,846			(761	)		—			4,090

Comprehensive income (loss):
	Net loss for the three months ended March 31, 2002 (unaudited)			—		—		—			8			—			8
	Net change in unrealized gain on securities available for sale, net of taxes of $20 (unaudited)			—		—		—			—			(33	)		(33	)

	Comprehensive income (loss) (unaudited)																(25	)

Balance at March 31, 2002 (unaudited)				489,410	$	5		4,846			(753	)		(33	)		4,065

Balance at December 31, 2002				817,775	$	8		7,932			(687	)		60			7,313

Comprehensive income:
		Net earnings for the three months ended March 31, 2003 (unaudited)		—		—		—			47			—			47
		Net change in unrealized gain on securities available for sale, net of taxes of $30 (unaudited)		—		—		—			—			(49	)		(49	)

		Comprehensive income (unaudited)															(2	)

Additional stock offering costs (unaudited)				—		—		(2	)		—			—			(2	)

Balance at March 31, 2003 (unaudited)				817,775	$	8		7,930			(640	)		11			7,309

See Accompanying Notes to Condensed Consolidated Financial Statements.

FPB BANCORP, INC. AND SUBSIDIARY

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)


				Three Months Ended
				March 31,

				2003			2002

Cash flows from operating activities:
	Net earnings			$	47			8
	Adjustments to reconcile net earnings to net cash used in operating activities:
		Depreciation			35			25
		Provision for loan losses			83			55
		Deferred income taxes			30			7
		Amortization of loan fees			(2	)		2
		Net amortization of securities			(19	)		2
		Gain on sale of securities available for sale			(33	)		—
		Increase in accrued interest receivable			(24	)		(10	)
		Increase in other assets			(54	)		(6	)
		Decrease in official checks and other liabilities			(526	)		(249	)

			Net cash used in operating activities		(463	)		(166	)

Cash flows from investing activities:
	Purchase of securities available for sale				(2,073	)		(2,000	)
	Principal payments on securities available for sale				574			65
	Proceeds from calls of securities available for sale				—			1,500
	Proceeds from sale of securities available for sale				2,179			—
	Principal payments on securities held to maturity				107			129
	Net increase in loans				(1,454	)		(2,933	)
	Purchase of premises and equipment				(62	)		(24	)
	Purchase of Federal Home Loan Bank stock				(42	)		—

			Net cash used in investing activities		(771	)		(3,263	)

Cash flows from financing activities:
	Net increase in deposits				3,035			8,987
	Decrease in federal funds purchased				—			(1,500	)
	Decrease in Federal Home Loan Bank advance				—			(1,000	)
	Net increase in notes payable				—			11
	Payment of common stock offering costs				(2	)		—

			Net cash provided by financing activities		3,033			6,498

Net increase in cash and cash equivalents					1,799			3,069
Cash and cash equivalents at beginning of period					7,825			2,448

Cash and cash equivalents at end of period				$	9,624			5,517

Supplemental disclosure of cash flow information:
	Cash paid during the period for:
		Interest		$	250			271

		Income taxes		$	—			—

	Noncash transactions:
		Accumulated other comprehensive income, net change in unrealized gain or loss on securities available for sale		$	(49	)		(33	)

See Accompanying Notes to Condensed Consolidated Financial Statements.

FPB BANCORP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (unaudited)

(1)		*General.*FPB Bancorp, Inc. is a one-bank holding company and owns 100% of First Peoples Bank (the “Bank”), a Florida-chartered commercial bank (collectively, the “Company”). The Holding Company’s only business activity is the operation of the Bank. The Bank’s deposits are insured by the Federal Deposit Insurance Corporation. The Bank offers a variety of community banking services to individual and corporate customers through its banking office located in Port St. Lucie, Florida.

		In the opinion of the management, the accompanying condensed consolidated financial statements of the Company contain all adjustments (consisting principally of normal recurring accruals) necessary to present fairly the financial position at March 31, 2003, and the results of operations and cash flows for the three-month periods ended March 31, 2003 and 2002. The results of operations for the three months ended March 31, 2003, are not necessarily indicative of the results to be expected for the full year.

(2)		*Loan Impairment and Credit Losses.*Loans identified as impaired at March 31, 2003 and 2002 and for the three-month periods then ended are as follows (in thousands):


	Three Months Ended
	March 31,

	2003		2002

Gross loans with related allowance for losses recorded, at end of period	$	69		—
Less: Allowance on these loans		34		—

Net investment in impaired loans, at end of period	$	35		—

Average investment in impaired loans	$	59		—

Interest income recognized on impaired loans	$	—		—

Interest income received on impaired loans	$	—		—

The activity in the allowance for loan losses was as follows (in thousands):


	Three Months Ended
	March 31,

	2003			2002

Balance at beginning of period	$	553			359
Provision for loan losses		83			55
Charge-offs		(22	)		(5	)

Balance at end of period	$	614			409

(continued)

FPB BANCORP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (unaudited), Continued

(2)

Loan Impairment and Credit Losses, Continued.Nonaccrual and past due loans were as follows (in thousands):


	At March 31,		At December 31,
	2003		2002

Nonaccrual loans	$	143		168
Past due ninety days or more, but still accruing		—		—

	$	143		168

(3)

Regulatory Capital.The Bank is required to maintain certain minimum regulatory capital requirements. The following is a summary at March 31, 2003 of the regulatory capital requirements and the Bank’s capital on a percentage basis:


	Percentage			Regulatory
	of the Bank			Requirement

Tier I capital to total average assets		9.20	%		4.00	%
Tier I capital to risk-weighted assets		13.05	%		4.00	%
Total capital to risk-weighted assets		14.30	%		8.00	%

(4)		*Earnings Per Share*.Basic and diluted earnings per share are computed on the basis of the weighted-average number of shares of common stock outstanding. Outstanding stock options are not dilutive.

(5)		*Stock Options*.The Company established an Incentive Stock Option Plan for officers and employees of the Company and reserved 97,882 shares of common stock for the plan. The exercise price of the stock options is the greater of $10 or the fair market value of the common stock on the date of grant. The options vest 33.3% during the second and third year, respectively, after grant and are fully exercisable during the fourth year after the grant date. The options must be exercised within ten years from the date of grant. A summary of stock option follows ($ in thousands, except share amounts):

Range

of Per

Weighted-

Share

Average

Aggregate

Number of

Option

Per Share

Option

Shares

Price

Outstanding at December 31, 2002 and March 31, 2003

97,882

10.00-10.50

10.03

982

(continued)

FPB BANCORP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (unaudited), Continued

(5)

Stock Options, Continued.The Company accounts for their stock option plans under the recognition and measurement principles of APB No. 25. No stock-based employee compensation cost is reflected in net earnings, as all options granted under those plans had an exercise price which approximated the market value of the underlying common stock on the date of grant. The following table illustrates the effect on net earnings and earnings per share if the Company had applied the fair value recognition provisions of FASB No. 123 to stock-based employee compensation ($ in thousands, except per share amounts).


		Three Months Ended
		March 31,

		2003		2002

Net earnings as reported		$	47		8
Deduct: Total stock-based employee compensation determined under the fair value based method for all awards, net of related tax effect			3		10

Proforma net earnings (loss)		$	44		(2	)

Earnings per share:
	Basic and diluted, as reported	$	.06		.02

	Basic and diluted, proforma	$	.05		—

FPB BANCORP, INC. AND SUBSIDIARY

Review by Independent Accountants

Hacker, Johnson & Smith PA, the Bank’s independent accountants, have made a limited review of the interim financial data as of March 31, 2003, and for the three-month periods ended March 31, 2003 and 2002, presented in this document, in accordance with standards established by the American Institute of Certified Public Accountants.

Their report furnished pursuant to Article 10 of Regulation S-X is included herein.

Independent Accountant’s Report

FPB Bancorp, Inc.
Port St. Lucie, Florida:

We have reviewed the accompanying condensed consolidated balance sheet of FPB Bancorp, Inc. and Subsidiary (the “Company”) as of March 31, 2003, and the related condensed consolidated statements of earnings, changes in stockholder’s equity and cash flows for the three-month periods ended March 31, 2003 and 2002. These financial statements are the responsibility of the Company’s management.

We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States of America, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet as of December 31, 2002, and the related consolidated statements of earnings, stockholders’ equity and cash flows for the year then ended (not presented herein); and in our report dated January 24, 2003, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2002, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/Hacker, Johnson & Smith PA

HACKER, JOHNSON & SMITH PA
Fort Lauderdale, Florida
April 21, 2003

FPB BANCORP, INC. AND SUBSIDIARY

Item 2. Management’s Discussion and Analysis
of Financial Condition and Results of Operations

Comparison of March 31, 2003 and December 31, 2002

Liquidity and Capital Resources

The Company’s primary sources of cash during the three months ended March 31, 2003 were from net deposit inflow of approximately $3.0 million, proceeds from sales, prepayments and calls of securities available for sale totaling $2.9 million. Cash was used primarily for net loan originations of $1.5 million and purchase of securities available for sale of $2.1 million. At March 31, 2003, the Company had time deposits of $7.2 million that mature in one year or less. At March 31, 2003, the Bank exceeded its regulatory liquidity requirements. Management believes that, if so desired, it can adjust the rates on time deposits to retain or attract deposits in a changing interest-rate environment.

The following table shows selected information for the periods ended or at the dates indicated:


	Three Months						Three Months
	Ended			Year Ended			Ended
	March 31,			December 31,			March 31,
	2003			2002			2002

Average equity as a percentage of average assets		12.58	%		11.11	%		8.96	%
Equity to total assets at end of period		11.93	%		12.44	%		8.48	%
Return on average assets (1)		.32	%		.14	%		.07	%
Return on average equity (1)		2.56	%		1.29	%		.78	%
Noninterest expenses to average assets (1)		3.63	%		3.53	%		3.84	%
Nonperforming loans to total assets at end of period		.2	%	NIL			NIL

(1)

Annualized for the three months ended March 31, 2003 and 2002.

FPB BANCORP, INC. AND SUBSIDIARY

Item 2. Management’s Discussion and Analysis
of Financial Condition and Results of Operations, Continued

Off-Balance Sheet Arrangements and Aggregate Contractual Obligations

The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, unused lines of credit and construction loans and standby letters of credit. These instruments involve, to varying degrees, elements of credit and interest-rate risk in excess of the amounts recognized in the consolidated balance sheet. The contract or notional amounts of those instruments reflect the extent of the Company’s involvement in particular classes of financial instruments.

The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit, unused lines of credit and construction loans and standby letters of credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments as it does for on-balance-sheet instruments.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total committed amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if it is deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation of the counter party.

Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers.

A summary of the amounts of the Company’s financial instruments, with off-balance sheet risk at March 31, 2003, follows (in thousands):


	Contract
	Amount

Commitments to extend credit	$	756

Unused lines of credit and construction loans	$	5,197

Standby letters of credit	$	251

Management believes that the Company has adequate resources to fund all of its commitments and that substantially all its existing commitments will be funded in 2003.

FPB BANCORP, INC. AND SUBSIDIARY

Results of Operations

The following table sets forth, for the periods indicated, information regarding (i) the total dollar amount of interest and dividend income of the Company from interest-earning assets and the resultant average yields; (ii) the total dollar amount of interest expense on interest-bearing liabilities and the resultant average cost; (iii) net interest income; (iv) interest-rate spread; (v) net interest margin; and (vi) ratio of average interest-earning assets to average interest-bearing liabilities.


			Three Months Ended March 31,

			2003							2002

					Interest		Average					Interest		Average
			Average		and		Yield/			Average		and		Yield/
			Balance		Dividends		Rate			Balance		Dividends		Rate

			(Dollars in thousands)
Interest-earning assets:
	Loans		$	43,464		745		6.86	%	$	33,873		644		7.60	%
	Securities			6,156		58		3.77			5,264		66		5.02
	Other (1)			2,526		15		2.38			4,173		17		1.63

		Total interest-earning assets		52,146		818		6.27			43,310		727		6.71

Noninterest-earning assets				5,771							2,325

		Total assets	$	57,917						$	45,635

Interest-bearing liabilities:
	Savings, NOW and money-market deposit accounts			15,196		71		1.87			11,897		62		2.08
	Time deposits			23,534		180		3.06			20,954		210		4.01
	Other (2)			—		—		—			503		1		.80

		Total interest-bearing liabilities		38,730		251		2.59			33,354		273		3.27

Demand deposits				10,926							7,545
Noninterest-bearing liabilities				976							648
Stockholders’ equity				7,285							4,088

		Total liabilities and stockholders’ equity	$	57,917						$	45,635

Net interest income					$	567						$	454

Interest-rate spread (3)								3.68	%						3.44	%

Net interest margin (4)								4.35	%						4.19	%

Ratio of average interest-earning assets to average interest-bearing liabilities				1.35							1.30

(1)		Includes federal funds sold, dividends from Federal Home Loan Bank stock, time deposit and interest-bearing deposits with banks.

(2)		Includes Federal Home Loan Bank advances and notes payable.

(3)		Interest-rate spread represents the difference between the average yield on interest-earning assets and the average rate of interest-bearing liabilities.

(4)		Net interest margin is net interest income divided by average interest-earning assets.

FPB BANCORP, INC. AND SUBSIDIARY

Comparison of the Three-Month Periods Ended March 31, 2003 and 2002

General. Net earnings for the three months ended March 31, 2003, were $47,000 or $.06 per basic and diluted share compared to net earnings of $8,000 or $.02 per basic and diluted share for the period ended March 31, 2002. This increase in the Company’s net earnings was primarily due to an increase in net interest income which was partially offset by an increase in the provision for loan losses and noninterest expense, all of which were due to the overall growth of the Company.

Interest Income. Interest income increased to $818,000 for the three months ended March 31, 2003 from $727,000 for the three months ended March 31, 2002. Interest income on loans increased to $745,000 due primarily to an increase in the average loan portfolio balance for the three months ended March 31, 2003, partially offset by a decrease in the average yield earned from 7.60% for the three months ended March 31, 2002 to 6.86% for the three months ended March 31, 2003. Interest on securities decreased to $58,000 due primarily to a decrease in the average yield earned during the three months ended March 31, 2003 partially offset by an increase in the average balance in the securities portfolio in 2003.

Interest Expense.Interest expense on deposit accounts decreased to $251,000 for the three months ended March 31, 2003, from $272,000 for the three months ended March 31, 2002. Interest expense decreased primarily because of a decrease in the average rate paid on deposits during 2003, partially offset by an increase in the average balance of deposits during 2003.

Provision for Loan Losses.The provision for loan losses is charged to earnings to bring the total allowance to a level deemed appropriate by management and is based upon historical experience, the volume and type of lending conducted by the Company, industry standards, the amount of nonperforming loans, general economic conditions, particularly as they relate to the Company’s market areas, and other factors related to the estimated collectibility of the Company’s loan portfolio. The provision for the three months ended March 31, 2003, was $83,000 compared to $55,000 for the same period in 2002. The increase in the provision was due to increased charge-offs during the three months ended March 31, 2003. Management believes the balance in the allowance for loan losses of $614,000 at March 31, 2003, is adequate.

Noninterest Income.Total noninterest income increased to $119,000 for the three months ended March 31, 2003, from $54,000 for the three months ended March 31, 2003 primarily as a result of the $33,000 gain on the sale of securities available for sale during 2003.

Noninterest Expenses. Total noninterest expenses increased to $526,000 for the three months ended March 31, 2003 from $438,000 for the three months ended March 31, 2002, primarily due to an increase in employee compensation and benefits of $18,000, an increase in professional fees of $29,000, an increase in data processing expense of $14,000 and an increase in other expenses of $18,000 all due to the continued growth of the Company.

Income Taxes.Income taxes for the three months ended March 31, 2003, were $30,000 (an effective rate of 39%) compared to an income taxes of $7,000 (an effective rate of 47%) for the three months ended March 31, 2002. The Company has recognized a deferred tax asset because management believes it will realize the deferred tax asset in future periods.

FPB BANCORP, INC. AND SUBSIDIARY

Item 3. Controls and Procedures

a.		Evaluation of Disclosure Controls and Procedures.The Company maintains controls and procedures designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. Based upon their evaluation of those controls and procedures performed within 90 days of the filing date of this report, the chief executive and chief financial officers of the Company concluded that the Company’s disclosure controls and procedures were adequate.

b.		Changes in Internal Controls.The Company made no significant changes in its internal controls or in other factors that could significantly affect these controls subsequent to the date of the evaluation of those controls by the Chief Executive and Chief Financial officers.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

There are no material pending legal proceeding to which the Company is a party or to which any of their property is subject.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits.The following exhibits are filed with or incorporated by reference into this report. The exhibits marked with an asterisk (*) were previously filed as a part of the Company’s Registration Statement on Form SB-1, filed with the Federal Deposit Insurance Corporation on April 30, 2000.


Exhibit No.		Description of Exhibit

*3.1		Articles of Incorporation
*3.2		Bylaws
*4.1		Specimen copy of certificate evidencing shares of the Company’s common capital stock, $0.01 par value
*4.2		First Peoples Bank Stock Option Plan dated January 14, 1999
*4.3		Warrant Agreement
*4.4		Non-Qualified Stock Option Agreement
*10.1		First Peoples Bank Qualified 401(k) Profit Sharing Plan, dated May 1, 1999
*10.2		Employment Agreement for David W. Skiles
99.1		CEO Certification required under Section 906 of Sarbanes-Oxley Act of 2002
99.2		CFO Certification required under Section 906 of Sarbanes-Oxley Act of 2002

(b)

Reports on Form 8-K.There were no Form 8-K’s filed during the three months ended March 31, 2003.

FPB BANCORP, INC. AND SUBSIDIARY

PART II. OTHER INFORMATION

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		FPB BANCORP, INC. (Registrant)

Date:	May 12, 2003	By:	/s/ David W. Skiles

			David W. Skiles, President and Chief Executive Officer

Date:	May 12, 2003	By:	/s/ Nancy E. Aumack

			Nancy E. Aumack, Senior Vice President and Chief Financial Officer

CERTIFICATIONS

I, David W. Skiles, certify, that:

1.		I have reviewed this quarterly report on Form 10-QSB of FPB Bancorp, Inc.;

2.		Based on my knowledge, the quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.		Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.		The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

	(a)		designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

	(b)		evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

	(c)		presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

	(a)		all significant deficiencies in the design or operation of the internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

	(b)		any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

The registrant’s other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect the internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

I, Nancy E. Aumack, certify, that:

1.		I have reviewed this quarterly report on Form 10-QSB of FPB Bancorp, Inc.;

2.		Based on my knowledge, the quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.		Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.		The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

	(a)		designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

	(b)		evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

	(c)		presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

	(a)		all significant deficiencies in the design or operation of the internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

	(b)		any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

May 12, 2003

/s/ David W. Skiles

David W. Skiles, President and Chief Executive Officer