LIGHTHOUSE BANK DECLARES SPECIAL $0.40 CASH DIVIDEND

Santa Cruz, Calif., November 14, 2014 - Lighthouse Bank (LGHT) today announced that its Board of Directors has approved a special cash dividend in the amount of $0.40 per share. The Dividend is payable on January 2, 2015, to shareholders of record at the close of business on December 5, 2014. The special cash dividend is the result of the Bank's continued profitability and significant capital strength. Regulatory requirements applying to banks that opened during the financial crisis did not generally allow the payment of cash dividends. Lighthouse Bank opened for business in October 2007 and was subject to those restrictions. This restrictive seven year term effecting newer banks, known as the "DeNovo" period, ended for Lighthouse Bank on October 29, 2014. The special cash dividend follows the issuance of stock dividends by the Bank in both 2011 and 2013.

Lighthouse Bank recently reported results for the 3rd quarter of 2014, ending 9-30-14. The Bank posted record earnings for the period of $725 thousand and recorded its 21st consecutive quarter of profitable operations. The Bank is extremely well capitalized with an Equity Capital-to-Total Assets Ratio of 15.4% and Shareholder's Equity of $25.1 million. Notwithstanding the payment of the special cash dividend, Lighthouse Bank continues to possess substantial capital resources and has the ability to fund its projected growth for the foreseeable future. The Bank's superior return on equity, which has averaged in excess of 10% over the past 8 quarters, has been driven principally by the company's flat organizational structure and extraordinary operational efficiency.

Lighthouse Bank marked its 7th anniversary on October 29, 2014. Since opening, the Bank's consistently strong financial results continue to place it at the top of the industry in a variety of categories including asset quality, capital adequacy, return on equity and operational efficiency. Lighthouse Bank was rated the top bank in Northern and Central California by FMC Consultants and 5th of the 215 banks in the state. The Bank is rated by Bauer financial as Five-Star "Superior" for strong financial performance, the top rating given by the independent bank rating firm. Lighthouse Bank is the only locally owned financial institution in Santa Cruz County awarded this top rating. The Findley Reports named the Bank as a "Super Premier" performing bank, which is their highest ranking. Lighthouse Bank has no financial relationship with any of these rating agencies.

ABOUT LIGHTHOUSE BANK:

Lighthouse Bank is a locally owned and operated full-service commercial bank located in Santa Cruz, Ca.   Lighthouse Bank offers a full array of banking products and services to businesses, professionals, individuals, developers and commercial property owners. The Bank is dedicated to providing exceptional personalized service and access to decision makers who are always close at hand. A unique worldwide ATM fee rebate program, business courier service, and remote deposit capture technology allow the Bank to expand its geographical reach throughout Santa Cruz County and the Silicon Valley. Lighthouse Bank is committed to operating an open, ethical and financially successful company without engaging in the corporate excesses that have come to characterize the financial services industry. All decisions are intended to contribute to the long-term success of its clients, employees, owners and the communities it serves. The Bank received no TARP funds and has neither accepted nor requested government assistance of any kind. Lighthouse Bank has never been subject to either formal or informal regulatory action.  

Lighthouse Bank is located at 111 Mission Street in Downtown Santa Cruz, Ca. Lighthouse Bank's stock (LGHT) is actively traded on the Over the Counter Bulletin Board via the Bank's market makers and online and full-service brokerage providers. More information on the Bank's stock and historical financial performance may be located on the Bank's website at www.lighthousebank.net or by calling 831-600-4000.

Member FDIC / Equal Housing Lender / SBA Preferred Lender

The attached release may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties may include but are not necessarily limited to fluctuation in interest rates, inflation, government regulations and general economic conditions, and competition within the business areas in which the Bank is conducting its operations, including the real estate market in California and other factors beyond the Bank's control. Such risks and uncertainties could cause results for subsequent interim periods or for the entire year to differ materially from those indicated. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. The Bank undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

For further information, please contact:

Richard Hofstetter

President and Chief Executive Officer

831-600-4008