Cardinal State Bank Announces First Quarter 2005 Financial Results

Cardinal State Bank Announces First Quarter 2005 Financial
Results 


DURHAM, N.C., April 12  /PRNewswire-FirstCall/ -- Cardinal State Bank
(NASDAQ:CSNC), a North Carolina state chartered bank headquartered in Durham,
North Carolina, announced today that its net income for the first quarter of
2005 was $206,000, compared to a net loss of $32,000 in the first quarter of
2004 and net income of $181,000 in the fourth quarter of 2004. Total assets
stood at $142,221,000 at March 31, 2005, compared to $103,494,000 at March 31,
2004, an increase of $38,727,000 or 37.4%. Similar gains were experienced in
deposits and loans which increased to $115,910,000 and $110,032,000,
respectively, from $94,281,000 and $91,053,000.

"We have continued our momentum from 2004 into the first quarter of 2005" said
John W. Mallard, Jr., President and CEO of Cardinal State Bank.  "Our balance
sheet has grown further and profitability continues to improve.  We have some
exciting preliminary plans underway that we will share with you in succeeding
quarters.  We remain highly optimistic about the remainder of 2005 and beyond."

Cardinal State Bank is a full-service community bank.  Founded in 2001, the
Bank has three offices in Durham: Homestead Market, Independence Park and
Westgate Drive.

This news release may contain, among other things, certain forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995, including, without limitation, (i) statements regarding certain of
Cardinal State Bank's goals and expectations with respect to earnings, earnings
per share, revenue, expenses and the growth rate in such items, as well as
other measures of economic performance, including statements relating to
estimates of credit quality trends, and (ii) statements preceded by, followed
by or that include the words "may", "could", "should", "would", "believe",
"anticipate", "estimate", "expect", "intend", "plan", "projects", "outlook" or
similar expressions. These statements are based upon the current beliefs and
expectations of Cardinal State Bank's management and are subject to significant
risks and uncertainties. Actual results may differ from those set forth in the
forward-looking statements. These forward-looking statements involve certain
risks and uncertainties that are subject to change based on various factors
(many of which are beyond Cardinal State Bank's control).

                             CARDINAL STATE BANK
                        ($000's Except Per Share Data)

                                                      As of or For The
                                                     Three Months Ended
                                                          March 31
                                                  2005                2004
  Income and Per Share Data:
  Interest Income                                $1,889               1,220
  Interest Expense                                  648                 458
  Net Interest Income                             1,241                 762
  Loan Loss Provision                                49                  77
  Net Interest Income
   After Provision                                1,192                 685
  Other Income                                      100                  78
  Other Expense                                   1,086                 795
  Income Before Taxes                               206                 (32)
  Income Taxes                                    -                   -
  Net Income (Loss)                                $206                 (32)

  Income (Loss) Per Share:
  Basic                                            $.09                (.03)
  Diluted                                           .09                (.03)
  Average Shares Outstanding
   (000's):
  Basic                                           2,261               1,280
  Diluted                                         2,290               1,280

  Balance Sheet Data:
  Total Assets                                 $142,221             103,494
  Total Deposits                                115,910              94,281
  Total Loans                                   110,032              91,053
  Loan Loss Reserve                               1,431               1,144
  Total Shareholders' Equity                     18,544               8,607

  Asset Quality:
  Non-Performing Loans                              197               -
  Non-Performing Loans
   To Total Assets (%)                              .14               -
  Net Loan Charge-Offs                                8               -
  Net Loan Charge-Offs
   To Average Loans (%)                             .03               -

  Performance Ratios:
  Return On Average Assets (%)                      .59                (.13)
  Return On Average Equity (%)                     4.50               (1.49)
  Net Interest Margin (%)                          3.69                3.15


DATASOURCE: Cardinal State Bank



CONTACT:  John W. Mallard, Jr., President and Chief Executive Officer of

Cardinal State Bank, [phone], or  

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