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Northrim BanCorp Profits Increased 14% to $2.1 Million, or $0.33 Per Share, in 2Q10



ANCHORAGE, Alaska, July 21, 2010 (GLOBE NEWSWIRE) -- Northrim BanCorp,
Inc. (Nasdaq:NRIM) today reported net income in the second quarter of
2010 increased 14% to $2.1 million, or $0.33 per diluted share,
compared to $1.9 million, or $0.29 per diluted share, in both the first
quarter of 2010 and the second quarter a year ago. For the first half
of 2010, profits grew 5% to $4.0 million, or $0.62 per diluted share,
from $3.8 million, or $0.60 per diluted share, in the first half of
2009.

Financial Highlights (at or for the quarter ended June 30, 2010,
compared to March 31, 2010, and June 30, 2009)


-- Northrim continued to strengthen its capital ratios with Tier 1
Capital/risk adjusted assets of 14.77% as compared to 14.31% in the
immediate prior quarter and 13.50% a year ago. These ratios do not
reflect any government investment in Northrim as the company elected not
to participate in the Capital Purchase Program sponsored by the U. S.
Treasury in 2008.
-- Northrim's tangible common equity to tangible assets at quarter end was
10.53%, up from 10.23% a year earlier.
-- Book value was $17.85 per share and tangible book value was $16.46 per
share, up from $17.04 and $15.60 respectively a year earlier.
-- Nonperforming assets declined in the quarter to $28.4 million or 2.82%
of total assets, compared to $31.6 million, or 3.20% of total assets at
the end of the first quarter 2010.
-- The allowance for loan losses continued to increase, now totaling 2.30%
of gross loans at June 30, 2010, compared to 2.17% at March 31, 2010,
and 1.93% a year ago. The allowance for loan losses to nonperforming
loans also increased to 93.6% from 90.25% at March 31, 2010 and 65.92% a
year ago.
-- Residential construction loans declined to $49.1 million or 8% of
portfolio loans, from $79.5 million, or 12% of portfolio loans, a year
ago.
-- Other operating income that includes revenues from service charges,
electronic banking, and financial services affiliates contributed 25% of
total second quarter revenues and 22% of year-to-date revenues.




"Our second quarter results showed improvement over those generated in
the first quarter of the year and in the like quarter a year ago," said
Marc Langland, Chairman, President and CEO of Northrim BanCorp, Inc.
"The earnings power of the bank and our strong balance sheet, along
with the stability of the Alaska market, have helped us in our efforts
to build shareholder value over the long-term."

Alaska Economic Update

"Throughout this economic cycle, Alaska has fared far better than the
rest of the country, and we continue to benefit from the strong
contribution from natural resources, tourism and government
operations," said Chris Knudson, Chief Operating Officer. "There are
now two competing proposals for a gas pipeline from the oil and gas
fields in northern Alaska to the lower 48 states. If either of these
proposals proceeds, the projected investment in this project is
expected to exceed $30 billion and may bring many jobs to the state.
However, discussions for this project have been ongoing for years, and
we are still a long way from breaking ground."

Through June of 2010, reports from the State of Alaska Department of
Labor indicate that employment in Alaska increased by 1% over last
year. Also, as of June 2010, the Alaska unemployment rate was 7.9% as
compared to 9.5% for the United States as a whole.

Northrim Bank recently launched the Alaskanomics blog to provide news,
analysis and commentary on Alaska's economy. With contributions from
economists, business leaders, policy makers and everyday Alaskans,
Alaskanomics aims to engage readers in an ongoing conversation about
our economy, now and in the future. Join the conversation at
Alaskanomics.com for more information on the Alaska economy by visiting
www.northrim.com and click on the "About Alaska" tab.

Asset Quality and Balance Sheet Review

Northrim's total assets grew 2% to $1.01 billion at June 30, 2010, from
$989 million at March 31, 2010, and 3% from $976 million at June 30,
2009, with an increase in overnight and portfolio investments
offsetting continuing maturities in the construction loan portfolio and
lower levels of commercial loans. The loan portfolio decreased 8% in
the second quarter to $628 million from $685 million a year ago. The
loan portfolio shows that about 86% of the customers are located in the
greater Anchorage area and 14% are in the Fairbanks area.

The loan portfolio remains diversified with commercial loans accounting
for 39% of the portfolio and commercial real estate accounting for 46%
of the portfolio at June 30, 2010. Construction and land development
loans, which accounted for 8% of the loan portfolio at June 30, 2010,
are down 38% to $49.1 million from $79.5 million a year ago, reflecting
the maturing of projects funded in past years, the reduction in new
projects starts in the past two years, and our continuing successful
collection efforts.

Nonperforming assets at June 30, 2010, declined by $3.2 million
year-over-year and from the preceding quarter. The risk profile of the
portfolio improved as a result of the following developments:


-- Loans measured for impairment decreased to $25.1 million at June 30,
2010, compared to $44.0 million at March 31, 2010, and $67.1 million in
the second quarter a year ago.
-- Nonperforming loans totaled $15.4 million, or 2.45% of total portfolio
loans at June 30, 2010, compared to $20.0 million, or 2.92% of total
portfolio loans a year ago.
-- All construction and development projects in Other Real Estate Owned
(OREO) are substantially complete and are being marketed.
-- The $5.3 million condominium conversion project in Anchorage that moved
into OREO during the fourth quarter of 2009 continues to generate rental
income producing an average yield of approximately 5%. Of the 68
original units, 32 condos have been sold and 36 are rented, providing
positive cash flow for the project.
-- Net charge-offs in the second quarter of 2010, totaled $994,000, or
0.16% of average loans, compared to net charge-offs of $2.3 million, or
0.33% of average loans during the second quarter of 2009. Year-to-date
net charge-offs totaled $1.4 million, or 0.45%, annualized, of average
loans, down from $3.2 million, 0.91%, annualized, of average loans in
the first half of 2009.
-- Sales of OREO continued during the second quarter, with 25 properties
sold for an aggregate of $3.9 million, generating a $211,000 net gain
over current carrying value. Year-to-date OREO sales generated $5.9
million in gross proceeds, $281,000 in gain on sale of 36 properties
total.
-- The coverage ratio of the allowance to nonperforming loans increased to
93.6% at June 30, 2010, compared to 65.92% in the second quarter a year
ago.




"The pace of sales in our OREO portfolio accelerated in the quarter,
and we are encouraged by the continued stability in the greater
Anchorage market," said Joe Beedle, President of Northrim Bank. "Since
we did not have the extreme spikes in pricing in our housing market
several years ago, we are not experiencing the extreme troughs and
oversupply that characterizes many markets in the rest of the country.
Loan demand continues to be soft as our customers remain conservative
in their capital expenditures given the economic, political and
business climate of the past two years."

The allowance for loan losses was $14.4 million, or 2.30% of portfolio
loans at the end of the second quarter of 2010, compared to $14.0
million, or 2.17% of total loans at March 31, 2010, and $13.2 million,
or 1.93% of total loans a year ago. The provision for loan losses in
the current quarter and the first half of 2010 continue to exceed net
charge-offs for the year.

Portfolio investments grew to $177.1 million at the end of the second
quarter of 2010, from $136.7 million a year ago. At June 30, 2010, the
portfolio was comprised of 72% U.S. Agency securities, 13% securities
of Alaskan municipalities, utilities, or state agencies, 14% corporate
bonds, and 1%, or $2 million of stock in the Federal Home Loan Bank of
Seattle. "We continue to manage our investments for credit quality and
liquidity and have not extended maturities to boost yield. In the
current low rate environment, we prefer to hold high quality, liquid
investments," said Joe Schierhorn, Chief Financial Officer. "When loan
demand picks up, we will be able to deploy these investments into
higher yielding assets."

Total deposits grew 2% in the quarter and 4% year-over-year to $851.5
million at June 30, 2010, compared to $835.1 million at March 31, 2010
and $819.1 million a year earlier. "All of our deposits are in-market
and time deposits continue to be heavily weighted to shorter-term
maturities," Knudson added. Noninterest-bearing demand deposits at June
30, 2010, increased 8% from a year ago and account for 32% of total
deposits. Interest-bearing demand deposits at the end of June 2010 also
grew 8% year-over-year and account for 14% of total deposits. The
Alaska CD (a flexible certificate of deposit program) grew 8% and
accounts for 13% of total deposits. Savings account balances were up
16% from a year ago and represent 8% of total deposits. Money market
balances were up 6% to 15% of all deposits and time deposit balances
fell 13% year-over year and now account for 17% of total deposits.

Shareholders' equity increased 6% to $114.0 million, or $17.85 per
share, at quarter end, compared to $108.0 million, or $17.04 per share,
at June 30, 2009. Tangible book value per share was $16.46 up from
$15.60 a year earlier. Northrim remains well capitalized with Tier 1
Capital to Risk Adjusted Assets of 14.77% at June 30, 2010.

Review of Operations

Reflecting increased contributions from affiliates, revenue (net
interest income plus other operating income) was $14.7 million, up from
$14.2 million in the preceding quarter and down from $15.3 million in
the second quarter of 2009. Year-to-date revenue totaled $28.9 million
compared to $30.1 million in the first half of 2009.

Second quarter 2010 net interest income, before the provision for loan
losses, was $11.1 million compared to $11.3 million in the preceding
quarter and $11.7 million in the second quarter of 2009. In the first
half of 2010, net interest income before provision for loan losses was
down 2% to $22.4 million from $22.8 million in the first half of 2009.

Northrim's net interest margin (net interest income as a percentage of
average earning assets on a tax equivalent basis) was 5.06% in the
second quarter of 2010, compared to 5.34% in the first quarter of 2010
and 5.48% in the second quarter a year ago. For the first six months of
2010, Northrim's net interest margin was 5.20% compared to 5.34% in the
like period a year ago. "While our second quarter net interest margin
was down over the last year, it remains one of the highest margins in
the nation according to the Uniform Bank Performance Report," said
Beedle. The strong margin reflects a number of factors including the
strength of our core deposits and recoveries of interest from
nonaccrual loans offset by lower loan volume and the increase in
lower-yielding overnight and portfolio investments.

The loan loss provision in the first and second quarters of 2010
totaled $1.4 million, compared to $2.1 million in the second quarter a
year ago. Year-to-date, the provision for loan losses totaled $2.8
million compared to $3.5 million in the first half of 2009. In the
second quarter of 2010, net interest income, after the provision for
loan losses, was $9.7 million compared to $9.9 million in the prior
quarter and $9.5 million a year ago. For the first six months of 2010,
net interest income after provision for loan losses was $19.7 million
compared to $19.4 million in the like period a year ago.

Total other operating income increased 26% for the second quarter of
2010 from the prior quarter and dipped 1% year-over-year reflecting
strong contributions from affiliated financial services offerings,
although volumes in Northrim's mortgage affiliate were off from last
year's levels. Other operating income totaled $3.6 million in the
second quarter of 2010 compared to $2.8 million in the first quarter of
2010 and $3.7 million in the second quarter of 2009. For the first six
months of 2010, other operating income totaled $6.5 million compared to
$7.2 million for the first six months of 2009. Deposit account service
charge income grew 9% in the linked quarter to $762,000 up from
$700,000 in the preceding quarter and compared to $775,000 in the
second quarter of 2009. For the first six months of the year, service
charges on deposit accounts were flat at $1.5 million.

Purchased receivable income contributed $595,000 to second quarter
revenues, up from $314,000 in the preceding quarter and $474,000 in the
year ago quarter. Year-to-date, purchased receivables income
contributed $909,000 down from $1.2 million in the first half of 2009.
"Income and expenses in this category fluctuate a great deal due to the
nature of the business and balances financed for customers. Northrim
Funding, our purchased receivables division based in the greater
Seattle area, offers a solid alternative to local financing options for
small businesses and provides us with a way to operate in the Puget
Sound commercial market," said Beedle.

Employee benefit plan income grew to $530,000 for the second quarter of
2010 compared to $447,000 for the second quarter of 2009 due to the
addition of more customers to this product line. Year-to-date employee
benefit plan income totaled $951,000 up from $813,000 a year ago. "This
product offering is attractive to the small to medium sized business in
our market and gives us just one more competitive advantage in
attracting and retaining commercial accounts in our market," noted
Langland. "We also benefit from the two wealth management affiliates in
which we have an ownership interest, Elliott Cove Capital and Pacific
Wealth Management. Both of these firms add diversification to our
income stream and to our customers' financial choices and they also
help us gain a larger share of customer assets."

Income from Northrim's mortgage affiliate contributed $182,000 to
second quarter revenues, down from $764,000 in the second quarter a
year ago, which was boosted by the strong refinance activity resulting
from the drop in mortgage rates last year. "While this part of our
business is highly interest rate sensitive, it also contributes to
revenues and helps build customer relationships," Langland continued.

Gain on sale of OREO and rental income from one of the larger projects
in the portfolio, also contributed to revenues in the quarter and the
year to date periods. "We continue to generate rental income from the
condo conversion project added to OREO last year. For the first six
months of this year, this project provided almost a 5% return on
investment," said Schierhorn.

Second quarter operating expenses were flat from the first quarter and
decreased 3% year-over-year, reflecting reduced insurance expenses,
OREO management costs, and professional and outside services.
Noninterest expense in the second quarter of 2010 was $10.2 million
compared to $10.5 million in the second quarter a year ago. Noninterest
expense in the first half of 2010 was $20.3 million compared to $21.1
million in the like period a year ago.

The efficiency ratio during the second quarter of 2010 was 68.63%,
compared to 71.21% in the first quarter of 2010 and 68.22% in the
second quarter a year ago. The efficiency ratio, calculated by dividing
noninterest expense, excluding intangible asset amortization expense,
by net interest income and noninterest income, measures overhead costs
as a percentage of total revenues.

About Northrim BanCorp

Northrim BanCorp, Inc. is the parent company of Northrim Bank, a
commercial bank that provides personal and business banking services
through locations in Anchorage, Eagle River, Wasilla, and Fairbanks,
Alaska, and an asset based lending division in Washington. The bank
differentiates itself with a "Customer First Service" philosophy.
Affiliated companies include Elliott Cove Capital Management, LLC;
Residential Mortgage, LLC; Northrim Benefits Group, LLC; and Pacific
Wealth Advisors, LLC. In June 2010, Northrim Bancorp was added to the
Russell 2000 Index, a subset of the Russell 3000 Index. Both indices
are widely used by professional money managers as benchmarks for
investment strategies.

www.northrim.com

The Northrim BanCorp, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=3818

Sources include the State of Alaska Department of Labor.







Income Statement
----------------------------------
(Dollars in thousands, except per
share data) Three Months Ending
-----------------------------------------------
Three One
(Unaudited) June 30, March 31, Month June 30, Year

% %
2010 2010 Change 2009 Change
--------- --------- ------ --------- ------
Interest Income:
Interest and fees on loans $11,212 $11,422 -2% $12,396 -10%
Interest on portfolio investments 1,315 1,329 -1% 1,043 26%

Interest on overnight investments 42 23 83% 16 163%
--------- --------- ------ --------- ------
Total interest income 12,569 $12,774 -2% 13,455 -7%
Interest Expense:
Interest expense on deposits 1,265 1,275 -1% 1,423 -11%

Interest expense on borrowings 201 195 3% 366 -45%
--------- --------- ------ --------- ------

Total interest expense 1,466 1,470 0% 1,789 -18%
--------- --------- ------ --------- ------
Net interest income 11,103 11,304 -2% 11,666 -5%


Provision for loan losses 1,375 1,375 0% 2,117 -35%
--------- --------- ------ --------- ------
Net interest income after
provision for loan losses 9,728 9,929 -2% 9,549 2%

Other Operating Income:
Service charges on deposit
accounts 762 700 9% 775 -2%
Purchased receivable income 595 314 89% 474 26%
Employee benefit plan income 530 421 26% 447 19%
Electronic banking income 435 400 9% 351 24%
OREO sale and rental income 383 270 42% 124 209%
Equity in earnings (loss) from
mortgage affiliate 182 (73) 349% 764 -76%
Gain on sale of securities 132 281 -53% 196 -33%

Other income 586 550 7% 519 13%
--------- --------- ------ --------- ------
Total other operating income 3,605 2,863 26% 3,650 -1%

Other Operating Expense:
Salaries and other personnel
expense 5,402 5,620 -4% 5,708 -5%
Occupancy expense 897 919 -2% 897 0%
Marketing expense 439 439 0% 316 39%
Insurance expense 422 558 -24% 959 -56%
OREO expense, including
impairment 343 372 -8% 448 -23%
Professional and outside services 323 242 33% 414 -22%
Equipment expense 244 273 -11% 257 -5%
Purchased receivable losses 406 1 40500% -- NA
Intangible asset amortization
expense 77 76 1% 83 -7%

Other expense 1,618 1,664 -3% 1,450 12%
--------- --------- ------ --------- ------
Total other operating expense 10,171 10,164 0% 10,532 -3%

Income before provision for
income taxes 3,162 2,628 20% 2,667 19%
--------- --------- ------ --------- ------

Provision for income taxes 912 702 30% 681 34%
--------- --------- ------ --------- ------

Net income 2,250 1,926 17% 1,986 13%
--------- --------- ------ --------- ------
Less: Net income attributable
to the noncontrolling interest 110 26 323% 109 1%
--------- --------- ------ --------- ------
Net income attributable to
Northrim BanCorp $2,140 $1,900 13% $1,877 14%
--------- --------- ------ --------- ------


Basic EPS $0.34 $0.30 13% $0.29 17%
Diluted EPS $0.33 $0.29 14% $0.29 14%
Average basic shares 6,386,925 6,385,760 0% 6,396,341 0%
Average diluted shares 6,473,622 6,468,310 0% 6,402,502 1%









Income Statement
-------------------------------
(Dollars in thousands, except
per share data) Six Months Ended June 30:
----------------------------
One
(Unaudited) Year

%
2010 2009 Change
--------- --------- ------
Interest Income:
Interest and fees on loans $22,634 $24,454 -7%
Interest on portfolio
investments 2,644 2,255 17%
Interest on overnight
investments 65 33 97%
--------- --------- ------
Total interest income 25,343 26,742 -5%
Interest Expense:
Interest expense on deposits 2,540 3,144 -19%

Interest expense on borrowings 396 756 -48%
--------- --------- ------

Total interest expense 2,936 3,900 -25%
--------- --------- ------
Net interest income 22,407 22,842 -2%


Provision for loan losses 2,750 3,492 -21%
--------- --------- ------
Net interest income after
provision for loan losses 19,657 19,350 2%

Other Operating Income:
Service charges on deposit
accounts 1,462 1,478 -1%
Employee benefit plan income 951 813 17%
Purchased receivable income 909 1,232 -26%
Electronic banking Income 835 661 26%
OREO sale and rental income 653 240 172%
Gain on sale of securities 413 196 111%
Equity in earnings from
mortgage affiliate 109 1,612 -93%

Other income 1,136 1,000 14%
--------- --------- ------
Total other operating income 6,468 7,232 -11%

Other Operating Expense:
Salaries and other personnel
expense 11,022 11,159 -1%
Occupancy, net 1,816 1,812 0%
Insurance Expense 980 1,764 -44%
Marketing expense 878 634 38%
OREO expense, including
impairment 715 844 -15%
Professional and outside
services 565 959 -41%
Equipment expense 517 520 -1%
Intangible asset amortization
expense 153 165 -7%
Purchased receivable losses 407 (16) 2644%

Other expense 3,282 3,211 2%
--------- --------- ------
Total other operating
expense 20,335 21,052 -3%


Income before income taxes 5,790 5,530 5%
--------- --------- ------

Provision for income taxes 1,614 1,508 7%
--------- --------- ------

Net income 4,176 4,022 4%
--------- --------- ------
Less: Net income
attributable to the
noncontrolling interest 136 190 -28%
--------- --------- ------
Net income attributable to
Northrim BanCorp $4,040 $3,832 5%
--------- --------- ------

Basic EPS $0.63 $0.60 5%
Diluted EPS $0.62 $0.60 3%
Average basic shares 6,386,343 6,394,965 0%
Average diluted shares 6,470,966 6,398,045 1%









Balance Sheet
------------------------
(Dollars in thousands, except per
share data)
Three One
(Unaudited) June 30, March 31, Month June 30, Year

% %
2010 2010 Change 2009 Change
---------- --------- ------ --------- ------

Assets:
Cash and due from banks $22,316 $18,920 18% $23,509 -5%
Overnight investments 82,749 59,259 40% 43,142 92%
Portfolio investments 177,050 173,686 2% 136,697 30%

Loans:
Commercial loans 244,291 248,732 -2% 266,227 -8%
Commercial real estate 290,122 298,887 -3% 294,249 -1%
Construction loans 49,122 54,238 -9% 79,464 -38%
Consumer loans 47,202 47,391 0% 47,266 0%
Other loans 134 246 -46% 248 -46%

Unearned loan fees (2,498) (2,577) -3% (2,557) -2%
---------- --------- ------ --------- ------
Total portfolio loans 628,373 646,917 -3% 684,897 -8%

Loans held for sale 8,210 -- NA 3,426 140%
---------- --------- ------ --------- ------
Total loans 636,583 646,917 -2% 688,323 -8%
Allowance for loan
losses (14,427) (14,046) 3% (13,187) 9%
---------- --------- ------ --------- ------
Net loans 622,156 632,871 -2% 675,136 -8%
Purchased receivables,
net 10,754 6,962 54% 9,822 9%
Premises and equipment,
net 27,932 28,140 -1% 29,171 -4%
Goodwill and intangible
assets 8,843 8,920 -1% 9,156 -3%
Other real estate owned 12,973 16,065 -19% 11,576 12%

Other assets 42,391 43,733 -3% 37,484 13%
---------- --------- ------ --------- ------

Total assets $1,007,164 $988,556 2% $975,693 3%
========== ========= ====== ========= ======

Liabilities:
Demand deposits $272,743 $260,817 5% $253,118 8%
Interest-bearing demand 120,826 120,373 0% 112,385 8%
Savings deposits 71,167 70,033 2% 61,331 16%
Alaska CDs 113,692 111,019 2% 104,906 8%
Money market deposits 126,841 126,156 1% 119,944 6%

Time deposits 146,216 146,657 0% 167,457 -13%
---------- --------- ------ --------- ------
Total deposits 851,485 835,055 2% 819,141 4%
Securities sold under
repurchase agreements 8,871 8,997 -1% 4,633 91%
Other borrowings 5,532 5,594 -1% 16,225 -66%
Junior subordinated
debentures 18,558 18,558 0% 18,558 0%

Other liabilities 8,694 7,938 10% 9,089 -4%
---------- --------- ------ --------- ------
Total liabilities 893,140 876,142 2% 867,646 3%

Shareholders' Equity:
Northrim BanCorp
shareholders' equity 113,981 112,411 1% 108,015 6%
---------- --------- ------ --------- ------

Noncontrolling interest 43 3 1333% 32 34%
---------- --------- ------ --------- ------
Total shareholders'
equity 114,024 112,414 1% 108,047 6%
---------- --------- ------ --------- ------
Total liabilities and
shareholders' equity $1,007,164 $988,556 2% $975,693 3%
========== ========= ====== ========= ======







Financial Ratios and Other Data
--------------------------------------
(Dollars in thousands, except per
share data)
(Unaudited) June 30, March 31, June 30,

2010 2010 2009
--------- --------- ---------
Asset Quality:
Nonaccrual loans $14,413 $13,950 $18,111
Loans 90 days past due 1,000 1,614 1,893
Total nonperforming loans 15,413 15,564 20,004

Other real estate owned 12,973 16,065 11,576
--------- --------- ---------

Total nonperforming assets $28,386 $31,629 $31,580
--------- --------- ---------
Nonperforming loans / portfolio loans 2.45% 2.41% 2.92%
Nonperforming assets / assets 2.82% 3.20% 3.24%
Allowance for loan losses / portfolio
loans 2.30% 2.17% 1.93%
Allowance / nonperforming loans 93.60% 90.25% 65.92%
Gross loan charge-offs for the
quarter $1,136 $950 $2,399
Gross loan recoveries for the quarter $142 $513 $104
Net loan charge-offs for the quarter $994 $437 $2,295
Net Loan charge-offs year-to-date $1,431 $437 $3,205
Net loan charge-offs for the quarter
/ average loans, quarter 0.16% 0.07% 0.33%
Net loan charge-offs year-to-date /
average loans, annualized 0.45% 0.27% 0.91%

Capital Data (At quarter end):
Book value per share $17.85 $17.60 $17.04
Tangible book value per share $16.46 $16.20 $15.60
Tangible Common Equity/Tangible
Assets 1 10.53% 10.56% 10.23%
Tier 1 Capital / Risk Adjusted Assets 14.77% 14.31% 13.50%
Total Capital / Risk Adjusted Assets 16.02% 15.57% 14.76%
Tier 1 Capital / Average Assets 12.52% 12.61% 12.21%
Shares outstanding 6,386,925 6,386,925 6,338,138
Unrealized gain on AFS securities,
net of income taxes $1,242 $1,295 $1,406

Profitability Ratios (For the
quarter):
Net interest margin (tax equivalent)2 5.06% 5.34% 5.48%
Efficiency ratio3 68.63% 71.21% 68.22%
Return on average assets 0.86% 0.79% 0.78%
Return on average equity 7.52% 6.84% 6.96%

Profitability Ratios (Year-to-date):
Net interest margin (tax equivalent)2 5.20% 5.34% 5.34%
Efficiency ratio 3 69.89% 71.21% 69.45%
Return on average assets 0.83% 0.77% 0.79%
Return on average equity 7.19% 6.70% 7.20%

1 Tangible common equity to tangible assets is a non-GAAP ratio that
represents total equity less goodwill and intangible assets divided by
total assets less goodwill and intangible assets. This ratio has
received more attention over the past several years from stock
analysts and regulators. The GAAP measure of assets to equity would
be total assets to total equity. Total equity to total assets was
11.32% at June 30, 2010 as compared to 11.37% at March 31, 2010 and
11.07% at June 30, 2009.

2 Tax-equivalent net interest margin is a non-GAAP performance
measurement in which interest income on non-taxable investments and
loans is presented on a tax-equivalent basis using a combined federal
and state statutory rate of 41.11% in both 2010 and 2009,
respectively.

3 The efficiency ratio is a non-GAAP ratio that is calculated by
dividing non-interest expense, exclusive of intangible asset
amortization, by the sum of net interest income and non-interest
income.







Average Balances
-----------------------------------
(Dollars in thousands, except per share data)
(Unaudited)
March Three One
June 30, 31, Month June 30, Year

% %
2010 2010 Change 2009 Change
-------- -------- ------ -------- ------

Average Quarter Balances
Total loans $635,810 $648,670 -2% $698,242 -9%
Total earning assets 885,059 863,786 2% 860,161 3%
Total assets 993,460 973,030 2% 965,478 3%

Noninterest-bearing
deposits 259,799 242,630 7% 243,299 7%
Interest-bearing
deposits 578,875 577,496 0% 566,712 2%
Total deposits 838,674 820,126 2% 810,011 4%

Shareholders' equity 114,143 112,590 1% 108,247 5%


Average Year-to-date Balances - unaudited
Loans $642,204 $648,670 -1% $701,895 -9%
Total earning assets 874,482 863,786 1% 868,532 1%
Total assets 983,302 973,030 1% 977,717 1%

Noninterest-bearing
deposits 251,262 242,630 4% 225,948 11%
Interest-bearing
deposits 578,189 577,496 0% 597,941 -3%
Total deposits 829,451 820,126 1% 823,889 1%

Shareholders' equity 113,371 112,590 1% 107,375 6%



This release may contain "forward-looking statements" that are subject
to risks and uncertainties. Readers should not place undue reliance on
forward-looking statements, which reflect management's views only as of
the date hereof. All statements, other than statements of historical
fact, regarding our financial position, business strategy and
management's plans and objectives for future operations are
forward-looking statements. When used in this report, the words
"anticipate," "believe," "estimate," "expect," and "intend" and words
or phrases of similar meaning, as they relate to Northrim or
management, are intended to help identify forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995. Although we believe that management's expectations as reflected
in forward-looking statements are reasonable, we cannot assure readers
that those expectations will prove to be correct. Forward-looking
statements are subject to various risks and uncertainties that may
cause our actual results to differ materially and adversely from our
expectations as indicated in the forward-looking statements. These
risks and uncertainties include our ability to maintain or expand our
market share or net interest margins, and to implement our marketing
and growth strategies. Further, actual results may be affected by our
ability to compete on price and other factors with other financial
institutions; customer acceptance of new products and services; the
regulatory environment in which we operate; and general trends in the
local, regional and national banking industry and economy as those
factors relate to our cost of funds and return on assets. In addition,
there are risks inherent in the banking industry relating to
collectability of loans and changes in interest rates. Many of these
risks, as well as other risks that may have a material adverse impact
on our operations and business, are identified in our other filings
with the SEC. However, you should be aware that these factors are not
an exhaustive list, and you should not assume these are the only
factors that may cause our actual results to differ from our
expectations.

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