Coast Bancorp First Quarter 2008 Earnings Announcement

Coast Bancorp (OTCBB: CTBP), the holding company for Coast National Bank, announced the unaudited financial results for the quarter ended March, 31, 2008.

Total assets at March 31, 2008 were $180.7 million, a 1.7% decrease from $183.8 million at December 31, 2007.

Net loans at March 31, 2008 were $145.2 million, an increase of $2.9 million or 2.0% from $142.3 million at December 31, 2007. The recorded investment in impaired loans as of March 31, 2008 was $4.4 million, an increase of $0.2 million or 4.8% from $4.2 million at December 31, 2007. The allowance for loan and lease losses, which covers credit losses pertaining to the loan portfolio, was $1.563 million or 1.1% of total loans at March 31, 2008. The Company also carried an additional $55,000 allowance for credit losses pertaining to its unfunded commitments in the liability section of its balance sheet. Collectively, the total allowance for all types of credit losses was $1.618 million at March 31, 208 as compared to $1.542 million at December 31, 2007.

Deposits as of March 31, 2008 were $158.9 million, a $3.2 million, or 2.0% decrease from $162.1 million at December 31, 2007.

Total stockholders' equity increased 2.1% to $14.4 million as of March 31, 2008 as compared to $14.1 million at December 31, 2007. The Company remained "well capitalized" by regulatory standards, with a Tier 1 Leverage Capital Ratio of 10.5%, a Tier 1 Risk Based Capital Ratio of 12.3% and a Total Risk Based Capital Ratio of 14.8%.

Net interest income before the provision for loan losses for the three months ended March 31, 2008 was $1,785,000, a decrease of 13.0% when compared to $2,052,000 for the three months ended March 31, 2007. The decrease in net interest income was primarily attributable to a decreased net interest margin, partially offset by the increase in total loans. The net interest margin for the three months ended March 31, 2008 was 4.4% compared to 5.1% for the three months ended March 31, 2007.

Non-interest income for the three months ending March 31, 2008 was $253,000, an increase of 83.3% compared to $138,000 for the three months ended March 31, 2007, primarily due to gains on the sale of SBA loans and of investments.

Non-interest expense for the three months ending March 31, 2008 was $1,657,000, a decrease of 7.2% compared to $1,786,000 for the three months ended March 31, 2007, primarily due to decreases in marketing and personnel expenses.

Net income for the three months ending March 31, 2008 was $161,000, or $0.22 per diluted share, a 25.5% decrease from $216,000, or $0.30 per diluted share for the three months ended March 31, 2007. The decrease is primarily the result of a lower net interest margin.

Coast National Bank opened for business on June 16, 1997. The Bank is an independent community bank with five banking offices and a loan production office. With a focus on delivering unsurpassed customer service, the Bank provides small business loans, home loans and other loans, as well as an array of business and personal banking deposit products and other services. The Bank is a wholly owned subsidiary of Coast Bancorp, a $181 million bank holding company, headquartered in San Luis Obispo, California. Coast Bancorp stock trades under the ticker symbol "CTBP.OB." For more information, visit www.coastnationalbank.com or call 805.541.0400.

Please refer to the following Consolidated Balance Sheets (unaudited) as of March 31, 2008 and December 31, 2007 and Consolidated Statements of Income (unaudited) for the three months ended March 31, 2008 and 2007 for specific information regarding the Company's financials.