EARNINGS RELEASE – August 2, 2017 Strong Second Quarter Earnings – New Branch Announced – Dividend Increased

EUREKA, CALIFORNIA – On August 2, 2017, REDWOOD CAPITAL BANCORP (RWCB.OB), the only locally owned and operated community bank holding company in Humboldt County, announced unaudited financial results for the three month period ended June 30, 2017.  The company reported a strong second quarter and the Board of Directors increased its quarterly dividend.

John Dalby, President and CEO remarked, “Management and the Board of Directors are delighted to announce the intent to open a fourth Redwood Capital Bank branch in Henderson Center, Eureka. The branch will be located in the former Roberts Building at Henderson and “F” Streets. Plans and permits are in process and we anticipate the branch opening in the first half of 2018. In addition to the full-service branch, the Henderson Center location will also provide additional office space for other Redwood Capital Bank employees from various departments. Redwood Capital Bank’s continued growth has surpassed the Eureka Main Branch’s location, requiring additional work space.” The company posted modest growth in the major balance sheet categories of assets, loans and deposits. Total assets as of June 30, 2017 were $331.1 million, an increase of 2% from the prior quarter and 2% from the same period last year. Total loans, net of unearned income, rose to $254.1 million as of June 30, 2017, an increase of 2% from the March 31, 2017 figures and an increase of 11% over the quarter ended June 30, 2016. Lastly, total deposits grew to $254.1 million as of June 30, 2017, an increase of 2% over the prior quarter and 2% higher than the June 30, 2016 reported figure.

Net interest income for the quarter ended June 30, 2017 totaled $3,053,000, up 4% from the $2,946,000 reported for the three months ended March 31, 2017 and up 4% from the $2,930,000 reported for the three months ended June 30, 2016. The company also reported net income after taxes and provision expenses in the second quarter of 2017 of $665,000, down 3% reported for the three months ended March 31, 2017 and down 7% from the $718,000 reported for the second quarter of 2016. The decrease was primarily attributed to loan loss provision expense taken as an abundance of caution to preserve overall credit quality. “Our lending activity is currently expanding thanks to a great team. Furthermore, despite the continued increases in branch activity, our branch personnel continue to provide customer service that is second-to- none,” stated Dalby.

Additionally, the Board of Directors declared an increased quarterly cash dividend of $0.065 per share, payable on August 14, 2017, to shareholders of record at the close of business on August 3, 2017. The dividend is equivalent to an annual rate of $0.26 per share or 1.37%, based upon a market price of $18.95 per common share. CEO Dalby explained, “We are pleased to announce an increase in the quarterly dividend for Redwood Capital Bancorp stock to six and one half cents. The increase of our dividend payments is a sign of our belief in the financial strength of the company and enhances the return to those that have entrusted us with their investment. Thank you to our shareholders for their continued support. We remain confident that our first half performance for 2017 is indicative of the opportunities available to us over the remainder of the year and beyond.”

For more information regarding Redwood Capital Bancorp, please visit our website at www.redwoodcapitalbank.com, contact Fred Moore, CFO, at (707) 444-9840, or stop by our headquarters and main office at 402 “G” Street, Eureka, California 95501.