For several California community banks, 1995 proved a breakout year.

Ten of them made dramatic gains in the bottom line. That's probably more than in any other state.

Of the 10, five came back from substantial losses; four went from barely break-even to over-1% returns on assets; and one, very profitable in 1994, nonetheless doubled net income.

Bank of San Francisco made the biggest swing in ROA - and one of the biggest in any state. After a whopping $33 million loss in 1994, it turned a $336,000 profit last year.

The $115 million-asset bank cut its loan-loss provisions and also benefited from the continued support of a major stockholder who has pumped in more than $44 million over four years.

In Northern California, Mid-State Bank, Arroyo Grande, and Mid-Peninsula Bancorp, Palo Alto, made strong gains.

Mid-State went from an $11 million loss to a $650,000 profit. Mid- Peninsula, already one of the better Northern California performers in 1994, doubled its earnings to $2.7 million.

Mid-State dramatically reduced nonaccrual loans and net chargeoffs; Mid- Peninsula hacked about $400,000 from nonperforming loans or other real estate owned, and now has no nonperformers.

For many banks that finally began to pick up steam in 1995, real estate was the reason. Down for most of the '90s, land values have slowly begun to recover throughout much of California.

"It really depends on the given market the banks are operating in," said Joseph K. Morford, analyst with Alex. Brown & Sons, San Francisco. "But whether a bank was behind the overall curve or not would probably have at least partially to do with the nature of its loan portfolio."

Another Northern California company that fared well last year was Redwood Empire Bancorp, Santa Rosa. Redwood bounced back from a 1994 loss of $3 million to a profit $3.3 million. The company restructured subsidiary Allied Bank, a move that boosted its mortgage operation.

There were even more-significant turnarounds in the southern part of the state.

Pacific National Bank, Newport Beach, went from a $1.1 million loss to a $2 million profit. The improvement came from lower operating expenses, extra volume at the residential mortgage operation, a rise in the net interest margin at the $174 million-asset bank.

Ventura County National Bancorp, Oxnard, turned a profit of nearly $3.8 million in 1995, up from 1994's loss of $262,000, thanks to utilization of deferred tax assets and to lower loan-loss provisions and noninterest expense.

Bank of Los Angeles also went from red ink to black, turning a $1.2 million loss into a $646,000 profit. The bank reduced its allowance for credit losses and benefited from a gain on the sale of loans in 1995.

Three other Southern California banks went from relatively small profits to banner years in 1995.

Santa Monica Bank's earnings jumped tenfold, to nearly $5.3 million, thanks to the sale of bank-owned real estate and a reduction in delinquent loans.

Profits of Orange National Bancorp, parent of Orange National Bank, tripled. The bank went through a restructuring and enjoyed favorable operating margins.

Bank of Hemet's profits quadrupled, to more than $2 million, largely because of reduced losses on loans and foreclosed real estate and the early termination of three leases on nonessential facilities.

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