/ CORRECTION - Beach Business Bank Reports Earnings and Continuing Growth in Loans & Deposits

In the news release, Beach Business Bank Reports Earnings and Continuing Growth in Loans & Deposits," issued earlier today by Beach Business Bank (OTCBB: BBBC), we are advised that there are two new additional paragraphs that were omitted from the original by the company, including company information and a safe harbor statement. These paragraphs occur immediately above the finanacial tables. Complete corrected text follows.

Beach Business Bank Reports Earnings and Continuing Growth in Loans & Deposits

MANHATTAN BEACH, CA--(January 31, 2008) - Beach Business Bank (OTCBB: BBBC) (the "Bank") reports 2007 net earnings of $595,000 with strong balance sheet growth from the prior quarter and prior year. Earnings of $1,045,000 had been recorded in 2006. Total assets increased 56.5% to $213.9 million from $136.7 million on December 31, 2006. Total loans increased 65.5% to $187.7 million from $113.4 million on December 31, 2006. Total deposits increased 74.6% to $172.7 million from $98.9 million on December 31, 2006. Non-interest bearing demand deposits totaled $19.5 million at year-end 2007, an increase of 127.5% over year-end 2006.

A substantial decrease in fourth quarter 2007 earnings compared to fourth quarter 2006 was primarily caused by the bank's decision to discontinue selling loans into the secondary market because of unstable market conditions, combined with a significant increase in loans outstanding. Compared to the fourth quarter of 2006, the bank realized a significant reduction of fee income from loan sales; and, as a result of the increase in loans outstanding, the Bank made a sizeable provision for possible loan losses. Fourth quarter 2007 earnings were $301,000 compared to $574,000 in the fourth quarter of 2006.

Robert M. Franko, President and Chief Executive Officer, commented, "Turmoil in the financial markets became even more apparent in the fourth quarter of 2007. Clearly, the coming year will be difficult for many financial institutions. We are fortunate that our strong capital position and healthy loan quality make it possible for us to quickly respond to rapidly evolving conditions. While we may be sacrificing short term gain by choosing not to sell as many loans at this time, we are confident that our actions will promote strong future earnings and growth."

During the fourth quarter, new loan commitments amounted to more than $47 million, while new loan commitments for the year 2007 amounted to more than $165 million. Based on these commitments the Bank realized 13.9% growth in net loans during the quarter compared to the previous quarter, and 65.9% growth in net loans over year-end 2006. Deposit growth was 11.0% over the previous quarter, and 74.6% over year-end 2006. Non-interest bearing demand deposits totaled $19.5 million at year-end 2007, an increase of 127.5% over $8.6 million at year-end 2006. Because of the strong loan growth, and based on general concerns about the overall state of the economy, the Bank provided $427,000 in the quarter to the Allowance for Loan & Lease Losses ("ALLL"), so that the ALLL now stands at approximately 1.45% of total loans. During the quarter, the Bank retained the guaranteed portions of SBA 7(a) loans and some other loans eligible for sale into the secondary market, rather than selling them. The guaranteed portion of SBA 7(a) and Express loans retained on the Bank's balance sheet at quarter end was approximately $12.8 million.

The Bank also experienced a decrease in net interest margin in the quarter to 4.70%, as the yield on floating rate loans declined more rapidly than the cost of the Bank's deposit liabilities. While the Bank is relatively neutral in its asset and liability mix, as rates in the market fall, liability costs tend to decline at a slower pace than repricing of loan rates.

Non-interest expenses for the quarter and the year were higher than management had anticipated for a number of reasons. During the second half of the year, the Bank hired an experienced group of bankers from the Seal Beach area. That group only began to realize loan and deposit growth in the fourth quarter. In addition, the Bank has continually positioned itself for portfolio growth by hiring experienced bankers who have worked at larger institutions. As a result, compensation has ranged at the high end of the market. The quality of the Bank's staff has enabled the Bank to grow rapidly in a very competitive market. Management is focused upon this cost structure to assure that it is appropriate for the coming year, should the growth prospects in the current market change at all.

The bank has one foreclosed property and one loan past due more than 30 days. In both cases, the bank believes it is adequately protected by collateral and property value. The property underlying the delinquent loan is an owner-occupied retail facility, which is currently listed for sale. The Bank believes that this loan will be fully repaid when the property is sold. The borrower has advised the Bank that he expects the property to sell in the first half of 2008.