COMPANY REPORTS INCOME EARNINGS

Capital Bancorporation's net income for the three months and six months ending June 30 were $1,257,000 and $2,292,000 respectively. Earnings per share were 47 cents and 87 cents respectively.

The company's total assets June 30 were $6,740,000.

Capital Bancorporation's non-performing loans were $2,113,000 June 30, compared to $2,915,000 March 31. The allowance for possible loan losses was $6,740,000 on June 30, representing approximately 319 percent of non-performing loans and approximately 1.49 percent of total loans.

Capital Bancorporation announced an agreement in March with Magna Group, Inc., of St. Louis to purchase Magna Bank of Southern Missouri, which operates nine locations. The purchase of the bank will increase Capital Bancorporation's assets to approximately $765 million. The acquisition is subject to regulatory approval. The acquisition will be financed from a portion of the proceeds of Capital Bancorporation's recently completed $13.8 million public offering of 690,000 depositary shares representing interests in its 9.75 Series C Preferred Stock and a portion of the proceeds of a loan from an unaffiliated lender.

The Board of Directors of Capital Bancorporation declared its regular cash dividend on common stock Friday. The dividend was 15 cents per share payable Aug. 6 to shareholders of record July 30. The board also declared the first cash dividend with respect to the depositary shares payable Sept. 1 to shareholders of record, Aug. 21.

Capital Bancorporation is a multi-bank holding company headquart~er~ed in Cape Girardeau. The firm operates 17 banking locations through five affiliate banks in Missouri.