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Exhibit 99.1 Heritage Commerce Corp Earns $ 11.2 Million for the First Quarter of 2021 San Jose , CA - April 22 , 2021 — Heritage Commerce Corp ( Nasdaq : HTBK ) , the holding company ( the “ Company ” ) for Heritage Bank of Commerce ( the “ Bank ” ) , today announced first quarter 2021 net income of $ 11.2 million , or $ 0.19 per average diluted common share , compared to $ 1.9 million , or $ 0.03 per average diluted common share , for the first quarter of 2020 , and $ 11.6 million , or $ 0.19 per average diluted common share , for the fourth quarter of 2020. First quarter 2021 results included the recapture of $ 1.5 million of provision for credit losses on loans , compared to a provision for credit losses on loans of $ 13.3 million for the first quarter of 2020. All results are unaudited . " While facing prolonged challenges posed by the COVID - 19 crisis , and the related economic uncertainty , the Company has continued to generate solid financial results , and the first quarter 2021 earnings were no exception , " said Walter Kaczmarek , President and Chief Executive Offic " Total deposits grew by 27 % , year - over - year , fueled by successful deposit gathering efforts that attracted over $ 900 million . Gross loans also increased 6 % , year - over - year , and by 3 % on a linked quarter basis . Our return on average tangible assets improved to 0.99 % for the first quarter compared to 0.19 % a year ago . Our year - over - year improvement in first quarter results benefited from our higher than usual provision for credit losses in the first quarter of 2020 taken in light of a downturn in the economy caused by the COVID - 19 pandemic , and from our decision to adopt the Current Expected Credit Loss ( “ CECL ” ) rate methodology early in 2020 , " said Mr. Kaczmarek . Mr. Kaczmarek continued , “ Our positive credit trends continue with nonperforming assets ( “ NPAs ” ) decreasing ( 54 % ) to $ 5.6 million at March 31 , 2021 , versus $ 12.1 million a year earlier , and declining ( 29 % ) from $ 7.9 million on a linked quarter basis . We had net loan recoveries of $ 1.4 million from previously charged - off accounts , compared to net charge - offs of $ 422,000 for the first quarter a year ago . " The allowance for credit losses on loans ( " ACLL " ) to total loans declined slightly to 1.64 % , and the ratio of ACLL to total loans , excluding PPP loans , was 1.88 % , at March 31 , 2021 , compared to 1.70 % and 1.91 % , respectively , at December 31 , 2020 . " Our local markets and customers have been negatively impacted by government actions necessary to contain the health crisis , and we are closely tracking our loan portfolio and responding to the needs of our customers , " said Mr. Kaczmarek . “ In the meantime , our capital , ACLL , and excess liquidity positions all remain strong . The total capital ratio was 16.5 % and leverage ratio was 9.1 % for the Company , and 15.8 % and 9.5 % , respectively , for the Bank , at March 31 , 2021. Notably , despite the adverse impact to the economy brought on by the pandemic , the Company's total assets increased 23 % from a year ago and surpassed the milestone of $ 5 billion at quarter - end . With a solid earnings performance , a large core deposit base , and excellent credit quality , we believe we have a solid foundation on which to grow as the economy recovers from the COVID - 19 pandemic . " In response to economic stimulus laws passed by Congress in 2020 and 2021 , Heritage Bank of Commerce has now funded two rounds of Small Business Administration ( “ SBA ” ) Payment Protection Program ( “ PPP ” ) loans . At March 31 , 2021 , after accounting for loan payoffs and SBA loan forgiveness , Round 1 PPP loans were $ 170.4 million and Round 2 PPP loans were $ 179.3 million . In total the Bank had $ 349.7 million in outstanding PPP loan balances at quarter - end . These loans generated $ 784,000 in interest income , $ 3.4 million in net deferred fee revenue ( $ 2.4 million from loans forgiven or paid off and $ 969,000 from net deferred fees ) , and $ 766,000 in deferred origination costs on Round 2 PPP loans during the first quarter of 2021. At March 31 , 2021 , the PPP loan portfolio had remaining deferred fees of ( $ 8.8 ) million and deferred costs of $ 1.1 million . On April 7 , 2020 , the U.S. banking agencies issued the Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus . The statement describes accounting for COVID - 19 - related loan modifications , including clarifying the interaction between current accounting rules and the temporary relief provided by the Coronavirus Aid , Relief , and Economic Security Act ( " CARES Act " ) . The Bank made accommodations for initial payment deferrals for a number of customers with a window of up to 90 days , with the potential of an additional 90 days of payment deferral ( 180 days maximum ) upon application . The Bank also waived all customary applicable fees . Of the loans for which deferrals were originally granted , nearly all have returned to regular payment status . 1