TriCo Bancshares (TCBK) 8-K Trico Bancshares Announces Quarterly Results

Exhibit 99.1

PRESS RELEASE
For Immediate Release Contact: Richard P. Smith           
President & CEO (530) 898-0300

TRICO BANCSHARES ANNOUNCES QUARTERLY RESULTS

CHICO, Calif. — (January 26, 2011) — TriCo Bancshares (NASDAQ: TCBK) (the “Company”), parent company of Tri Counties Bank (the “Bank”), today announced a quarterly earnings of $3,126,000 for the quarter ended December 31, 2010. This compares with earnings of $2,313,000 the Company reported for the quarter ended December 31, 2009. Diluted earnings per share for the quarter ended December 31, 2010 was $0.20 compared to diluted earnings per share of $0.14 for the quarter ended December 31, 2009. Diluted earnings per share for the year ended December 31, 2010 and 2009 were $0.37 and $0.62, respectively, on earnings of $6,005,000 and $9,962,000, respectively.

Included in the Company’s results for the three and twelve month periods ended December 31, 2010 is the acquisition of the banking operations of Granite Community Bank (“Granite”), Granite Bay, California from the FDIC under a whole bank purchase and assumption agreement with loss sharing on May 28, 2010 by Tri Counties Bank. The assets acquired and liabilities assumed in the Granite acquisition have been accounted for under the acquisition method of accounting (formerly the purchase method). The acquired loan portfolio and foreclosed assets are referred to as “covered loans” and “covered foreclosed assets”, respectively. Collectively these balances are referred to as “covered assets”.

Total assets of the Company increased $19,269,000 (0.9%) to $2,189,789,000 at December 31, 2010 from $2,170,520,000 at December 31, 2009. Total loans of the Company decreased $80,640,000 (5.4%) to $1,419,571,000 at December 31, 2010 from $1,500,211,000 at December 31, 2009. The decrease in loans is net of $64,802,000 of loans acquired in the Granite acquisition. Total deposits of the Company increased $23,661,000 (1.3%) to $1,852,173,000 at December 31, 2010 from $1,828,512,000 at December 31, 2009. The increase in deposits is net of $95,001,000 of deposits acquired in the Granite acquisition on May 28, 2010, and a $70,000,000 decrease in certificates of deposit issued to the State of California during the fourth quarter of 2010.

The following is a summary of the components of net income for the periods indicated (dollars in thousands):

	Three months ended
	December 31,
	2010			2009
Net Interest Income	$	22,591		$	22,469
Provision for loan losses		(8,144	)		(7,800	)
Noninterest income		9,881			7,925
Noninterest expense		(19,470	)		(19,528	)
Benefit (provision) for income taxes		(1,732	)		(753	)
Net income	$	3,126		$	2,313

Net interest income for the three months ended December 31, 2010 was $22,591,000, an increase of $122,000 or 0.5% compared to the same period in 2009. The increase in net interest income was attributable to a $119,488,000 or 6.0% increase in the average balance of total interest-earning assets that was partially offset by a decrease in fully tax-equivalent (FTE) net interest margin to 4.30% during the three months ended December 31, 2010 from 4.55% during the year-ago quarter. The decrease FTE net interest margin was mainly due to a change in the mix of interest-earning assets, with average loan balances decreasing and other categories of lower yielding assets increasing.

The following table details the components of the net interest income and net interest margin on a fully tax-equivalent (FTE) basis for the three months ended December 31, 2010 and 2009:

	Quarter ended December 31, 2010								Quarter ended December 31, 2009
	Average					Yield/			Average					Yield/
(Dollars in thousands)	Balance		Income			Rate			Balance		Income			Rate
Assets:
Loans	$	1,443,603	$	23,070			6.39	%	$	1,508,472	$	24,356			6.46	%
Securities		297,971		2,391			3.21	%		232,881		2,745			4.71	%
Cash at Fed and other banks	$	365,925		252			0.28	%	$	246,658		154			0.25	%
Total earning assets	$	2,107,499		25,713			4.88	%		1,988,011		27,255			5.48	%
Other assets		127,972								147,611
Total assets		2,235,471								2,135,622
Liabilities and shareholders’ equity:
Interest-bearing demand deposits	$	393,356	$	459			0.47	%	$	339,924	$	709			0.83	%
Savings deposits		580,451		449			0.31	%		484,638		762			0.63	%
Time deposits		515,809		1,200			0.93	%		597,091		2,254			1.51	%
Junior sub debt		41,238		320			3.10	%		41,238		319			3.09	%
Other borrowings		63,040		608			3.86	%		69,593		617			3.55	%
Total interest-bearing liabilities	$	1,593,894		3,036			0.76	%		1,532,484		4,661			1.22	%
Noninterest-bearing deposits		405,390								362,618
Other liabilities		32,475								35,264
Shareholders’ equity		203,712								205,256
Total liabilities and shareholders’ equity	$	2,235,471							$	2,135,622
Net interest rate spread							4.12	%							4.27	%
Net interest income/net interest margin (FTE)			$	22,677			4.30	%			$	22,594			4.55	%
FTE adjustment				(86	)							(125	)
Net interest income before FTE adjustment			$	22,591							$	22,469

The provision for loan losses was $8,144,000 for the three months ended December 31, 2010, compared to $7,800,000 for the three months ended December 31, 2009. The increases in the provision for loan losses for the three months ended December 31, 2010 as compared to the same period in 2009 was primarily the result of changes in the make-up of the loan portfolio and the Bank’s loss factors in reaction to increased losses in the construction, commercial real estate, commercial & industrial (C&I), home equity and auto indirect loan portfolios. Management re-evaluates its loss ratios and assumptions quarterly and makes changes as appropriate based upon, among other things, changes in loss rates experienced, collateral support for underlying loans, changes and trends in the economy, and changes in the loan mix. Included in the provision for loan losses for the three months ended December 31, 2010 is $1,394,000 related to loans covered under FDIC loss sharing agreements that was substantially offset by a $1,294,000 increase in the FDIC loss-share indemnification asset recorded in noninterest income.

Noninterest income for the three months ended December 31, 2010 was $9,881,000, an increase of $1,956,000, or 24.7%, as compared to the same period in 2009. The following table presents the key components of noninterest income for the three months ended December 31, 2010 and 2009:

	Three months ended December 31,
						Change			Change
(dollars in thousands)	2010		2009			Amount			Percent
Service charges on deposit accounts	$	3,510	$	4,153		$	(643	)		(15.5	%)
ATM fees and interchange revenue		1,601		1,317			284			21.6	%
Other service fees		378		402			(24	)		(6.0	%)
Mortgage servicing fees		358		306			52			17.0	%
Change in value of mortgage servicing rights		198		(235	)		433
Gain on sale of loans		1,394		673			721			107.1	%
Commissions on sale of nondeposit investment products		342		271			71			26.2	%)
Increase in cash value of life insurance		569		1,059			(490	)		(46.3	%)
Gain (loss) on disposition of foreclosed assets		156		—			156
Change in FDIC loss-share indemnification asset		1,294		—			1,294
Other noninterest income		81		(21	)		102
Total noninterest income	$	9,881	$	7,925		$	1,956			24.7	%

The decrease in service charges in the three months ended December 31, 2010 over the same period in 2009 is mainly due to new overdraft regulations that became effective on July 1, 2010 and caused a decrease in non-sufficient funds fees. ATM fees and interchange revenue increased due to increased customer point-of-sale transactions that are the result of incentives for such usage. Other service fees increase mainly due to increased loan servicing fees from higher balances of loans being serviced. Change in value of mortgage servicing rights increased primarily due to increased residential mortgage rates at the end of the quarter that are expected to decrease the pace of future mortgage refinancing that in turn increase the value of mortgage servicing rights. Gain on sale of loans increased due to increased mortgage refinancing activity when compared to prior year similar periods. The reduction in increase in cash value of life insurance is primarily due to unusually high earnings rates from such insurance policies during the fourth quarter of 2009. The large contribution from change in FDIC loss-share is due to increased actual and estimated losses related to loans covered under FDIC loss sharing agreements that occurred during the fourth quarter of 2010.

Noninterest expense for the three months ended December 31, 2010 was $19,470,000, a decrease of $58,000, or 0.3%, as compared to the same period in 2009. The following table presents the key components of noninterest expense for the three months ended December 31, 2010 and 2009:

	Three months ended
	December 31,					Change			Change
(dollars in thousands)	2010			2009		Amount			Percent
Salaries and benefits expense:
Base salaries net of deferred origination costs	$	7,160		$	7,031	$	129			1.8	%
Incentive compensation expense		478			308		170			55.2	%
Benefits and other compensation costs		2,434			2,350		84			3.6	%
Total salaries and benefits expense		10,072			9,689		383			4.0	%
Other noninterest expense:
Equipment and data processing		1,613			1,804		(191	)		(10.6	%)
Occupancy		1,457			1,276		181			14.2	%
Advertising		702			706		(4	)		(0.6	%)
ATM network charges		475			687		(212	)		(30.9	%)
Telecommunications		456			496		(40	)		(8.1	%)
Professional fees		387			571		(184	)		(32.2	%)
Courier service		222			221		1			0.5	%
Postage		217			226		(9	)		(4.0	%)
Intangible amortization		85			65		20			30.8	%
Operational losses		103			90		13			14.4	%
Assessments		833			1,465		(632	)		(43.1	%)
Change in reserve for unfunded commitments		(200	)		—		(200	)
Provision for foreclosed asset losses		336			33		303			918.2	%
Foreclosed assets expense		601			100		501			501.0	%
Other		2,111			2,099		12			0.6	%
Total other noninterest expense	$	9,398			9,839		(441	)		(4.5	%)
Total noninterest expense	$	19,470		$	19,528		($58	)		(0.3	%)
Average full time equivalent employees		677			658		19			2.9	%

Salaries and related benefits increased $383,000, or 4.0% in the three months ending December 31, 2010, as compared to the same period in the prior year. The increase was due to very low incentive compensation in all product lines during the fourth quarter of 2009, and a 2.9% percent increase in average full time equivalent staff, primarily in new branches and loan collection functions. Equipment expense decreased due to reduced equipment purchases and some equipment reaching full depreciation. Occupancy expense increased for the three months ended December 31, 2010, as compared to the same period in the prior year, primarily due to four new branch openings, one each in the third and fourth quarters of 2009 and one each in the first and second quarters of 2010, and three branches and one admin facility acquired in the Granite acquisition on May 28, 2010. The increases in provision for foreclosed asset losses and foreclosed assets expense is due to additional value deterioration of such foreclosed assets and associated operating and maintenance expenses.

For the three months ended December 31, 2010, the Company recorded an income tax expense of $1,732,000. This tax expense represents 35.7% of the $4,858,000 net income before tax recorded for the three months ended December 31, 2010. The effective tax rate for the three month period ended December 31, 2009 was 24.6%. The provision or benefit for income taxes for all periods presented is primarily attributable to the respective level of earnings and the incidence of allowable deductions, particularly from increase in cash value of life insurance, tax-exempt loans and state and municipal securities.

In addition to the historical information contained herein, this press release may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The reader of this press release should understand that all such forward-looking statements are subject to various uncertainties and risks that could affect their outcome. The Company’s actual results could differ materially from those suggested by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, variances in the actual versus projected growth in assets, return on assets, interest rate fluctuations, economic conditions in the Company’s primary market area, demand for loans, regulatory and accounting changes, loan losses, expenses, rates charged on loans and earned on securities investments, rates paid on deposits, competition effects, fee and other noninterest income earned as well as other factors detailed in the Company’s reports filed with

the Securities and Exchange Commission which are incorporated herein by reference, including the Form 10-K for the year ended December 31, 2009. These reports and this entire press release should be read to put such forward-looking statements in context and to gain a more complete understanding of the uncertainties and risks involved in the Company’s business. Any forward-looking statement may turn out to be wrong and cannot be guaranteed. The Company does not intend to update any of the forward-looking statements after the date of this release.

TriCo Bancshares and Tri Counties Bank are headquartered in Chico, California. Tri Counties Bank has a 35-year history in the banking industry. It operates 34 traditional branch locations and 27 in-store branch locations in 23 California counties. Tri Counties Bank offers financial services and provides a diversified line of products and services to consumers and businesses, which include demand, savings and time deposits, consumer finance, online banking, mortgage lending, and commercial banking throughout its market area. It operates a network of 69 ATMs and a 24-hour, seven days-a-week telephone customer service center. Brokerage services are provided by the Bank’s investment services affiliate, Raymond James Financial Services, Inc. For further information please visit the Tri Counties Bank web site athttp://www.tricountiesbank.com.

TRICO BANCSHARES — CONSOLIDATED FINANCIAL DATA
(Unaudited. Dollars in thousands, except share data)

	Three months ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2010			2010			2010			2010			2009
Statement of Income Data
Interest income	$	25,627		$	27,233		$	25,776		$	25,936		$	27,130
Interest expense		3,036			3,497			3,642			3,958			4,661
Net interest income	$	22,591			23,736			22,134			21,978			22,469
Provision for loan losses		8,144			10,814			10,000			8,500			7,800
Noninterest income:
Service charges and fees		6,045			5,237			6,082			5,735			5,943
Other income		3,836			1,926			2,022			1,812			1,982
Total noninterest income		9,881			7,163			8,104			7,547			7,925
Noninterest expense:
Base salaries net of deferred loan origination costs	$	7,160			7,131			6,990			6,974			7,031
Incentive compensation expense		478			294			526			546			308
Employee benefits and other compensation expense		2,434			2,473			2,469			2,630			2,350
Total salaries and benefits expense		10,072			9,898			9,985			10,150			9,689
Other noninterest expense		9,398			10,626			8,423			8,653			9,839
Total noninterest expense		19,470			20,524			18,408			18,803			19,528
Income (loss) before taxes	$	4,858			(439	)		1,830			2,222			3,066
Net income	$	3,126		$	1		$	1,320		$	1,558		$	2,313
Share Data
Basic earnings per share	$	0.20		$	0.00		$	0.08		$	0.10		$	0.15
Diluted earnings per share	$	0.20		$	0.00		$	0.08		$	0.10		$	0.14
Book value per common share	$	12.64		$	12.66		$	12.76		$	12.63		$	12.71
Tangible book value per common share	$	11.62		$	11.64		$	11.74		$	11.63		$	11.71
Shares outstanding		15,860,138			15,860,138			15,860,138			15,860,138			15,787,753
Weighted average shares		15,860,138			15,860,138			15,860,138			15,822,789			15,787,753
Weighted average diluted shares		16,009,538			15,972,826			16,107,909			16,073,875			16,012,078
Credit Quality
Nonperforming loans	$	75,987		$	84,983		$	72,708		$	70,284		$	49,871
Guaranteed portion of nonperforming loans(2)		3,937			4,131			4,674			4,853			4,975
Foreclosed assets, net of allowance		9,913			11,172			9,945			5,579			3,726
Loans charged-off		6,040			11,163			8,424			8,101			7,258
Loans recovered		1,698			689			513			468			380
Allowance for losses to total loans(1)		3.18	%		2.86	%		2.75	%		2.75	%		2.62	%
Allowance for losses to NPLs(1)		59	%		49	%		57	%		57	%		78	%
Allowance for losses to NPAs(1)		53	%		43	%		50	%		53	%		73	%
Selected Financial Ratios
Return on average total assets		0.56	%		0.00	%		0.24	%		0.29	%		0.43	%
Return on average equity		6.14	%		0.00	%		2.61	%		3.05	%		4.51	%
Average yield on loans		6.39	%		6.61	%		6.20	%		6.21	%		6.46	%
Average yield on interest-earning assets		4.88	%		5.31	%		5.13	%		5.19	%		5.48	%
Average rate on interest-bearing liabilities		0.76	%		0.87	%		0.92	%		1.02	%		1.22	%
Net interest margin (fully tax-equivalent)		4.30	%		4.63	%		4.41	%		4.40	%		4.55	%

(1)	Allowance for losses includes allowance for loan losses and reserve for unfunded commitments.
(2)	Portion of nonperforming loans guaranteed by the U.S. Government, including its agencies and its government-sponsored agencies.

TRICO BANCSHARES — CONSOLIDATED FINANCIAL DATA
(Unaudited. Dollars in thousands)

	Three months ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2010			2010			2010			2010			2009
Balance Sheet Data
Cash and due from banks	$	371,066		$	398,191		$	322,644		$	308,664		$	346,589
Securities, available-for-sale		277,271			250,012			275,783			292,065			211,622
Federal Home Loan Bank Stock		9,133			9,157			9,523			9,274			9,274
Loans held for sale		4,988			9,455			4,153			3,384			4,641
Loans:
Commercial loans		141,902			149,743			162,898			147,988			163,181
Consumer loans		423,238			436,597			434,943			444,831			458,083
Real estate mortgage loans		807,482			821,562			860,615			810,386			815,375
Real estate construction loans		46,949			44,890			42,484			48,600			58,931
Total loans, gross		1,419,571			1,452,792			1,500,940			1,451,805			1,495,570
Allowance for loan losses		(42,571	)		(38,770	)		(38,430	)		(36,340	)		(35,473	)
Foreclosed assets		9,913			11,172			9,945			5,579			3,726
Premises and equipment		19,120			18,947			19,001			19,178			18,742
Cash value of life insurance		50,541			49,972			49,546			49,120			48,694
Goodwill		15,519			15,519			15,519			15,519			15,519
Intangible assets		580			665			750			260			325
Mortgage servicing rights		4,605			3,905			4,033			4,310			4,089
FDIC indemnification asset		5,640			5,098			7,515			—			—
Accrued interest receivable		7,131			7,318			7,472			7,715			7,763
Other assets		37,282			36,185			36,251			39,054			39,439
Total assets		2,189,789			2,229,618			2,224,645			2,169,587			2,170,520
Deposits:
Noninterest-bearing demand deposits		424,070			389,315			386,617			378,695			377,334
Interest-bearing demand deposits		395,413			383,859			383,578			375,313			359,179
Savings deposits		585,845			577,603			552,616			533,115			511,671
Time certificates		446,845			537,764			567,138			546,174			580,328
Total deposits		1,852,173			1,888,541			1,889,949			1,833,297			1,828,512
Accrued interest payable		2,151			2,368			2,487			3,064			3,614
Reserve for unfunded commitments		2,640			2,840			2,840			3,640			3,640
Other liabilities		29,170			26,721			25,257			27,112			26,114
Other borrowings		62,020			67,182			60,452			60,952			66,753
Junior subordinated debt		41,238			41,238			41,238			41,238			41,238
Total liabilities		1,989,392			2,028,890			2,022,223			1,969,303			1,969,871
Total shareholders’ equity		200,397			200,728			202,422			200,284			200,649
Accumulated other comprehensive gain (loss)		1,310			3,606			4,132			2,053			2,278
Average loans		1,443,603			1,481,497			1,463,473			1,469,685			1,508,472
Average interest-earning assets		2,107,499			2,060,108			2,019,684			2,008,896			1,988,011
Average total assets		2,235,471			2,237,670			2,191,660			2,169,138			2,135,622
Average deposits		1,895,006			1,893,677			1,849,118			1,825,190			1,784,271
Average total equity	$	203,712		$	205,324		$	203,528		$	204,200		$	205,256
Total risk based capital ratio		14.2	%		13.8	%		13.6	%		13.5	%		13.4	%
Tier 1 capital ratio		12.9	%		12.6	%		12.3	%		12.3	%		12.1	%
Tier 1 leverage ratio		10.0	%		9.9	%		10.2	%		10.3	%		10.5	%
Tangible capital ratio		8.5	%		8.3	%		8.4	%		8.6	%		8.6	%