8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) May 4, 2007

GREATER BAY BANCORP

(Exact name of registrant as specified in its charter)

California	0-25034	77-0387041
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1900 University Avenue, 6th Floor East Palo Alto, CA	94303
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (650) 813-8200

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operation and Financial Condition.

On May 4, 2007, Greater Bay Bancorp (the “Registrant”) issued a press release regarding its results of operations and financial condition for the first quarter ended March 31, 2007. The text of the press release is included as Exhibit 99.1 to this report. The information included in the press release is considered to be “furnished” under the Securities Exchange Act of 1934.

Item 9.01 Financial Statements and Exhibits.

List below the financial statements, pro forma financial information and exhibits, if any, filed as a part of this report.

(a) Financial statements of businesses acquired. None

(b) Pro forma financial information. None

(c) Shell company transactions. None

(d) Exhibits.

Exhibit No.	Description of Exhibit
99.1	Press Release dated May 4, 2007, deemed “furnished” under the Securities Exchange Act of 1934

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Greater Bay Bancorp

(Registrant)

Date: May 7, 2007

By:	/s/ Linda M. Iannone
	Linda M. Iannone Executive Vice President and General Counsel

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
99.1	Press Release dated May 4, 2007, deemed “furnished” under the Securities Exchange Act of 1934

EX-99.1

Exhibit 99.1

For Information Contact
At Greater Bay Bancorp:	At Silverman Heller Associates:
Byron A. Scordelis, President and CEO	Philip Bourdillon/Gene Heller
(650) 838-6101	(310) 208-2550
James S. Westfall, EVP and CFO
(650) 838-6108

FOR IMMEDIATE RELEASE

GREATER BAY BANCORP REPORTS

FINANCIAL RESULTS

FOR THE FIRST QUARTER OF 2007

EAST PALO ALTO, Calif., May 4, 2007 – Greater Bay Bancorp (Nasdaq: GBBK), a $7.4 billion in assets financial services holding company, today announced results for the first quarter of 2007.

For the first quarter of 2007, the Company’s net income was $17.8 million, or $0.31 per diluted common share, compared to $26.2 million, or $0.46 per diluted common share, for the first quarter of 2006, and $18.8 million, or $0.33 per diluted common share, for the fourth quarter of 2006.

Operating results for the quarter included notable expenses of $1.5 million in professional services associated with the Company’s previously announced strategic planning project and $0.7 million of pension-related expenses. These expenses were offset by a $1.5 million mark-to-market gain in the value of the Company’s venture capital and equity securities. Additionally, also included in the operating results for the first quarter were expenses related to prior periods of $1.4 million in compensation expense and $0.4 million in tax expense. These errors were immaterial to the prior periods as well as to the current period and accordingly, were corrected in the current quarter.

For the first quarter of 2007, the Company’s return on average common equity, annualized, was 9.65% compared to 15.62% for the first quarter of 2006, and 10.03% for the fourth quarter of 2006. Return on average assets, annualized, for the first quarter of 2007 was 0.98% compared to 1.49% for the first quarter of 2006, and 1.00% for the fourth quarter of 2006.

Commenting on the quarter Byron A. Scordelis, President and Chief Executive Officer of Greater Bay Bancorp, stated, “While the size of our loan portfolio was relatively flat due to faster-than-expected pay downs in the construction lending area, our specialty finance business once again delivered solid high-quality growth. We sustained our core deposit

Greater Bay Bancorp Reports

Financial Results for the First Quarter of 2007

May 4, 2007

Page 2 of 11

totals after posting an annualized gain of more than 15% in the prior quarter, and our insurance brokerage business achieved net new business inflow that effectively neutralized declining premium levels. We are also pleased with the sustained strength of our credit metrics as well as with our realization of measurable operating cost control given the three particular expense items noted above.”

Net Interest Income and Margin

Net interest income for the first quarter of 2007 decreased to $59.9 million from $66.9 million in the first quarter of 2006, and from $63.9 million in the fourth quarter of 2006.

The net interest margin (on a fully tax-equivalent basis) for the first quarter of 2007 was 3.78%, compared to 4.37% for the first quarter of 2006 and 3.91% for the fourth quarter of 2006.

“The quarterly margin decline primarily reflects continued increase in customer deposit costs and a gradual balance shift away from non-interest-bearing demand deposits,” stated James S. Westfall, Executive Vice President and Chief Financial Officer.

Non-Interest Income

Non-interest income for the first quarter of 2007 decreased modestly to $58.5 million compared to $58.8 million in the first quarter of 2006. First quarter 2007 results compared to first quarter 2006 included an increase of $1.5 million in mark-to-market gains on venture capital and equity securities and a decrease of $0.7 million in ABD revenues.

Non-interest income for the first quarter of 2007 increased to $58.5 million compared to $51.6 million in the fourth quarter of 2006. The $6.9 million increase was primarily attributable to a $5.2 million increase in insurance commissions and fees reflecting normal first quarter seasonality and a $2.7 million increase in mark-to-market gains in our venture capital and equity securities.

Non-interest income as a percentage of total revenues for the first quarter of 2007 was 49.4%, compared to 46.8% for the first quarter of 2006 and 44.7% for the fourth quarter of 2006.

Operating Expenses

Operating expenses for the first quarter of 2007 increased modestly to $90.7 million from $90.5 million in the first quarter of 2006. First quarter 2007 operating expenses included $1.5 million for professional services associated with the Company’s previously announced strategic planning project, $0.7 million in pension related expenses, and $1.4 million in compensation expense related to prior periods.

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Greater Bay Bancorp Reports

Financial Results for the First Quarter of 2007

May 4, 2007

Page 3 of 11

Operating expenses for the first quarter of 2007 increased to $90.7 million from $88.0 million in the fourth quarter of 2006. This increase was primarily attributable to an increase of $3.5 million in compensation and benefits, including first quarter seasonal increases in payroll taxes and 401(k) matching contribution expenses of $2.7 million and $1.4 million of compensation expense related to prior periods. This was partially offset by a decrease of $0.7 million in occupancy and equipment costs.

Income Taxes

The Company’s effective tax rate was 38.3% for the first quarter of 2007 compared to 36.5% for the first quarter of 2006. Approximately 150 basis points of the rate increase was due to $0.4 million of income tax expense related to prior periods.

The Company adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” or FIN 48 effective January 1, 2007 and as a result recognized a $4.5 million reserve addition for uncertain tax positions which was recorded as a reduction to retained earnings as of January 1, 2007, and had no effect on net income.

Credit Quality Overview

Net loan charge-offs in the first quarter of 2007 were $1.1 million, or 0.09% of average loans, annualized, compared to $43,000, or less than 0.01% of average loans, annualized, for the first quarter of 2006 and $3.2 million, or 0.26% of average loans, annualized, for the fourth quarter of 2006.

Provision for credit losses was a negative $1.1 million for the first quarter of 2007, compared to a negative $6.0 million for the first quarter of 2006, and a negative $0.4 million for the fourth quarter of 2006.

Non-performing assets were $32.1 million at March 31, 2007, compared to $33.4 million at March 31, 2006 and $30.2 million at December 31, 2006. The ratio of non-performing assets to total assets was 0.43% at March 31, 2007, compared to 0.47% at March 31, 2006 and 0.41% at December 31, 2006. The ratio of non-accrual loans to total loans was 0.64% at March 31, 2007, compared to 0.70% at March 31, 2006 and 0.61% at December 31, 2006.

Allowance for loan and lease losses was $66.0 million, or 1.35% of total loans, at March 31, 2007, compared to $74.6 million, or 1.58% of total loans, at March 31, 2006 and $68.0 million, or 1.39% of total loans, at December 31, 2006.

“We are pleased with our quarterly results in virtually every key credit portfolio quality indicator,” commented Mr. Scordelis. “Our recording of a negative provision for the quarter is consistent with our negligible charge-off experience. We continue to adhere to a consistent and disciplined application of sound credit fundamentals, and believe that our results are reflective of that approach.”

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Greater Bay Bancorp Reports

Financial Results for the First Quarter of 2007

May 4, 2007

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Balance Sheet

At March 31, 2007, total assets were $7.4 billion, total net loans and leases were $4.9 billion, total securities were $1.4 billion, and total deposits were $5.3 billion.

Total loans and leases, net of deferred costs and fees, were $4.9 billion at March 31, 2007, which represents an increase of $176.1 million, or 3.7%, compared to March 31, 2006. This growth reflects an increase of $253.0 million in commercial loans and leases and $28.7 million in commercial term real estate loans. These increases were partially offset by declines of $39.1 million in construction and land loans, $38.4 million in consumer and other loans, and $33.7 million in real estate other loans.

Total loans and leases, net of deferred costs and fees, were unchanged between December 31, 2006 and March 31, 2007. Increases of $53.8 million in commercial loans and leases and $64.5 million in commercial term real estate loans were offset by decreases of $80.9 million in construction and land loans, $26.6 million in real estate other loans, $6.7 million in consumer and other loans and $5.3 million in residential mortgages.

Securities totaled $1.4 billion as of March 31, 2007, compared to $1.5 billion at March 31, 2006 and $1.5 billion at December 31, 2006.

Total deposits at March 31, 2007 were $5.3 billion, which represents an increase of $200.2 million, or 3.9%, compared to March 31, 2006, and an increase of $51.8 million compared to December 31, 2006.

Core deposits (excluding institutional and brokered deposits) at March 31, 2007 were $4.3 billion, which represents a decrease of $204.9 million, or 4.6%, compared to March 31, 2006, and an increase of $11.7 million compared to December 31, 2006.

Capital Overview

The capital ratios of Greater Bay Bancorp and its subsidiary bank continue to comfortably exceed minimum well-capitalized guidelines established by bank regulatory agencies.

The Company’s common equity to assets ratio was 10.13% at March 31, 2007, compared to 9.69% at March 31, 2006 and 9.99% at December 31, 2006. The Company’s tangible common equity to tangible assets ratio was 6.47% at March 31, 2007, compared to 5.84% at March 31, 2006 and 6.32% at December 31, 2006.

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Financial Results for the First Quarter of 2007

May 4, 2007

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Other Matters

As a separate matter, the Company today announced that it has signed a definitive merger agreement with Wells Fargo & Company. Consummation of the merger is subject to shareholder and regulatory approvals and other customary closing conditions.

About Greater Bay Bancorp

Greater Bay Bancorp, a diversified financial services holding company, provides community banking services in the Greater San Francisco Bay Area through Greater Bay Bank, N.A.’s community banking organization, including Bank of Petaluma, Coast Commercial Bank, Golden Gate Bank, Mid-Peninsula Bank, Mt. Diablo National Bank, Peninsula Bank of Commerce and Santa Clara Valley National Bank. Nationally, Greater Bay Bancorp provides specialized leasing and loan services through its specialty finance group, which includes Matsco, Greater Bay Business Funding and Greater Bay Capital. ABD Insurance and Financial Services, the Company’s insurance brokerage subsidiary, provides commercial insurance brokerage, employee benefits consulting and risk management solutions to business clients throughout the United States.

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Greater Bay Bancorp Reports

Financial Results for the First Quarter of 2007

May 4, 2007

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Safe Harbor

Certain matters discussed in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements relate to the Company’s current expectations regarding future operating results, net interest margin, net loan charge-offs, asset quality, level of loan loss provisions, growth in loans and deposits, ABD revenue growth and level of operating expenses. These forward looking statements are subject to certain risks and uncertainties that could cause the actual results, performance or achievements to differ materially from those expressed, suggested or implied by the forward looking statements. These risks and uncertainties include, but are not limited to: (1) the impact of changes in interest rates, a decline in economic conditions at the local, national and international levels and increased competition among financial service providers on the Company’s results of operations and the quality of the Company’s earning assets; (2) government regulation, including ABD’s receipt of requests for information from state insurance commissioners and subpoenas from state attorneys general related to the ongoing insurance industry-wide investigations into contingent commissions and override payments; and (3) the other risks set forth in the Company’s reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2006. Greater Bay does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.

For additional information and press releases about Greater Bay Bancorp, visit the Company’s website at http://www.gbbk.com.

-Financial Tables Follow-

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Greater Bay Bancorp

Financial Results for the First Quarter of 2007

May 4, 2007

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GREATER BAY BANCORP

March 31, 2007 - FINANCIAL SUMMARY (UNAUDITED)

(Dollars and shares in 000’s, except per share data)

SELECTED QUARTERLY CONSOLIDATED OPERATING DATA:

	First Quarter 2007			Fourth Quarter 2006			Third Quarter 2006			Restated(7) Second Quarter 2006			Restated(7) First Quarter 2006
Interest income	$	113,479		$	116,308		$	113,916		$	108,321		$	104,015
Interest expense		53,572			52,419			50,142			42,487			37,134
Net interest income before (reversal of) / provision for credit losses		59,907			63,889			63,774			65,834			66,881
(Reversal of) / provision for credit losses		(1,073	)		(384	)		(443	)		(1,886	)		(6,004	)
Net interest income after (reversal of) / provision for credit losses		60,980			64,273			64,217			67,720			72,885
Non-interest income:
Insurance commissions and fees		43,898			38,730			41,757			40,235			44,600
Rental revenue on operating leases		4,322			4,490			4,632			4,790			4,950
Service charges and other fees		2,196			2,324			2,363			2,368			2,540
Loan and international banking fees		2,047			1,980			1,960			1,718			1,795
Income on bank owned life insurance		1,726			2,003			2,038			1,922			1,911
Trust fees		1,054			1,138			1,059			1,127			1,055
Other income		3,221			908			1,643			4,610			1,915
Total non-interest income		58,464			51,573			55,452			56,770			58,766
Operating expenses:
Compensation and benefits		58,762			55,279			52,548			50,906			57,556
Occupancy and equipment		10,751			11,457			11,896			11,192			11,322
Legal costs and other professional fees		4,123			3,950			5,074			3,884			3,753
Depreciation - operating leases		3,393			3,503			3,665			3,917			4,003
Amortization of intangibles		1,462			1,507			1,678			1,689			1,640
Other expenses		12,167			12,281			16,220			11,387			12,271
Total operating expenses		90,658			87,977			91,081			82,975			90,545
Income before provision for income taxes and cumulative effect of accounting change		28,786			27,869			28,588			41,515			41,106
Provision for income taxes		11,027			9,091			10,076			15,423			15,006
Income before cumulative effect of accounting change		17,759			18,778			18,512			26,092			26,100
Cumulative effect of accounting change, net of tax (1)		—			—			—			—			130
Net income	$	17,759		$	18,778		$	18,512		$	26,092		$	26,230
EARNINGS PER SHARE DATA:
Net Income per common share before cumulative effect of accounting change (2)
Basic	$	0.32		$	0.34		$	0.33		$	0.48		$	0.49
Diluted	$	0.31		$	0.33		$	0.32		$	0.47		$	0.46
Net Income per common share after cumulative effect of accounting change (2)
Basic	$	0.32		$	0.34		$	0.33		$	0.48		$	0.49
Diluted	$	0.31		$	0.33		$	0.32		$	0.47		$	0.46
Weighted average common shares outstanding		50,488			50,478			50,423			50,188			49,802
Weighted average common & potential common shares outstanding		51,294			51,180			51,366			51,173			52,727
GAAP ratios
Return on quarterly average assets, annualized		0.98	%		1.00	%		1.00	%		1.47	%		1.49	%
Return on quarterly average common shareholders’ equity, annualized		9.65	%		10.03	%		10.15	%		14.85	%		15.62	%
Return on quarterly average total equity, annualized		8.48	%		8.81	%		8.89	%		12.95	%		13.56	%
Net interest margin, annualized (3)		3.78	%		3.91	%		3.97	%		4.26	%		4.37	%
Operating expense ratio, annualized (4)		5.01	%		4.71	%		4.92	%		4.66	%		5.15	%
Efficiency ratio (5)		76.59	%		76.20	%		76.39	%		67.68	%		72.06	%
NON-GAAP ratios
Efficiency ratio (excluding ABD & other ABD expenses paid by holding company) (6)		72.92	%		67.08	%		69.63	%		58.27	%		66.35	%
(1)    Effective January 1, 2006, the Company adopted SFAS No.123R, as a result of which the Company recognized a one-time cumulative adjustment, to record an estimate of future forfeitures on outstanding equity based awards for which compensation expense had been recognized prior to adoption.
(2)    The following table provides a reconciliation of income available to common shareholders. Additionally, the Company's outstanding convertible preferred stock was antidilutive for all periods presented.
Income before cumulative effect of accounting change as reported	$	17,759		$	18,778		$	18,512		$	26,092		$	26,100
Less: dividends on convertible preferred stock		(1,831	)		(1,832	)		(1,832	)		(1,822	)		(1,832	)
Income available to common shareholders before cumulative effect of accounting change		15,928			16,946			16,680			24,270			24,268
Add: CODES interest and other related income/(loss), net of taxes		—			—			—			—			59
Income available to common shareholders before cumulative effect of accounting change		15,928			16,946			16,680			24,270			24,327
Cumulative effect of accounting change, net of tax		—			—			—			—			130
Income available to common shareholders after cumulative effect of accounting change	$	15,928		$	16,946		$	16,680		$	24,270		$	24,457
Weighted average common shares outstanding		50,488			50,478			50,423			50,188			49,802
Weighted average potential common shares:
Stock options		806			702			943			985			946
CODES due 2024		—			—			—			—			1,979
Total weighted average common & potential common shares outstanding		51,294			51,180			51,366			51,173			52,727
(3)    Net interest income (on a tax equivalent basis) for the period, annualized and divided by average quarterly interest earning assets for the period.
(4)    Total operating expenses for the period, annualized and divided by average quarterly assets.
(5)    Total operating expenses divided by total revenue (the sum of net interest income and non-interest income, excluding provision for credit losses).
(6)    Total operating expenses less ABD operating expenses divided by total revenue less ABD revenue. The following table provides the information for calculating the efficiency ratio excluding ABD:
Revenue (excluding ABD)	$	74,032		$	75,911		$	77,083		$	82,180		$	80,546
Operating expenses (excluding ABD & other ABD-related expenses)	$	53,990		$	50,924		$	53,670		$	47,888		$	53,441
(7)    Restated Q1 and Q2 2006 to reflect adoption of SEC Staff Accounting Bulletin No.108 effective January 1, 2006.

Greater Bay Bancorp

Financial Results for the First Quarter of 2007

May 4, 2007

Page 8 of 11

GREATER BAY BANCORP

March 31, 2007 - FINANCIAL SUMMARY (UNAUDITED)

(Dollars in 000’s)

SELECTED CONSOLIDATED FINANCIAL CONDITION DATA AND RATIOS:

	Mar 31 2007			Dec 31 2006			Restated(6) Sep 30 2006			Restated(6) Jun 30 2006			Restated(6) Mar 31 2006
Cash and cash equivalents	$	139,083		$	170,365		$	160,572		$	198,716		$	167,203
Fed funds sold		161,000			—			—			36,000			—
Securities		1,435,692			1,543,097			1,572,109			1,565,732			1,468,123
Loans and leases:
Commercial		2,299,362			2,245,549			2,136,235			2,072,334			2,046,402
Term real estate - commercial		1,468,160			1,403,631			1,423,090			1,394,518			1,439,416
Total commercial		3,767,522			3,649,180			3,559,325			3,466,852			3,485,818
Real estate construction and land		649,009			729,871			753,416			762,409			688,086
Residential mortgage		274,329			279,615			277,038			275,332			271,658
Real estate other		146,697			173,271			163,077			164,133			180,409
Consumer and other		62,026			68,698			79,131			101,821			100,468
Deferred costs and fees, net		6,254			5,206			4,278			4,066			3,285
Total loans and leases, net of deferred costs and fees		4,905,837			4,905,841			4,836,265			4,774,613			4,729,724
Allowance for loan and lease losses		(65,950	)		(68,025	)		(71,323	)		(71,689	)		(74,568	)
Total loans and leases, net		4,839,887			4,837,816			4,764,942			4,702,924			4,655,156
Goodwill		246,016			246,016			242,687			243,343			242,728
Other intangible assets		43,069			42,978			44,515			46,227			48,005
Other assets		517,581			530,862			554,985			583,167			533,366
Total assets	$	7,382,328		$	7,371,134		$	7,339,810		$	7,376,109		$	7,114,581
Deposits:
Demand, noninterest-bearing	$	953,808		$	1,028,245		$	980,050		$	1,015,734		$	1,004,575
MMDA, NOW and savings		2,679,239			2,614,349			2,613,387			2,734,656			2,957,354
Time deposits, $100,000 and over		911,915			892,048			784,557			776,712			782,891
Other time deposits		763,975			722,541			681,104			495,131			363,941
Total deposits		5,308,937			5,257,183			5,059,098			5,022,233			5,108,761
Other borrowings		791,670			825,837			994,044			970,390			750,248
Subordinated debt		180,929			180,929			180,929			287,631			210,311
Other liabilities		237,061			254,812			256,545			268,899			240,008
Total liabilities		6,518,597			6,518,761			6,490,616			6,549,153			6,309,328
Minority interest:
Preferred stock of real estate investment trust subsidiaries		12,902			12,861			12,821			12,780			12,739
Convertible preferred stock		103,069			103,094			103,094			103,096			103,097
Common shareholders’ equity (1)		747,760			736,418			733,279			711,080			689,417
Total shareholders’ equity (1)		850,829			839,512			836,373			814,176			792,514
Total liabilities and total equity	$	7,382,328		$	7,371,134		$	7,339,810		$	7,376,109		$	7,114,581
RATIOS:
Loan growth, current quarter to prior year quarter		3.72	%		3.76	%		3.19	%		0.72	%		4.93	%
Loan growth, current quarter to prior quarter, annualized		0.00	%		5.71	%		5.12	%		3.81	%		0.15	%
Loan growth, YTD		0.00	%		3.76	%		3.06	%		1.99	%		0.15	%
Core loan growth, current quarter to prior year quarter (2)		4.37	%		4.45	%		3.90	%		1.32	%		1.39	%
Core loan growth, current quarter to prior quarter, annualized (2)		0.34	%		6.41	%		5.91	%		4.47	%		0.66	%
Core loan growth, YTD (2)		0.34	%		4.45	%		3.73	%		2.58	%		0.66	%
Deposit growth, current quarter to prior year quarter		3.92	%		3.93	%		0.87	%		2.93	%		2.26	%
Deposit growth, current quarter to prior quarter, annualized		3.99	%		15.53	%		2.91	%		-6.79	%		4.03	%
Deposit growth, YTD		3.99	%		3.93	%		0.01	%		-1.45	%		4.03	%
Core deposit growth, current quarter to prior year quarter (3)		-4.58	%		-6.79	%		-10.48	%		-6.63	%		-5.78	%
Core deposit growth, current quarter to prior quarter, annualized (3)		1.11	%		15.29	%		-14.43	%		-19.72	%		-8.31	%
Core deposit growth, YTD (3)		1.11	%		-6.79	%		-13.71	%		-13.84	%		-8.31	%
Revenue growth, current quarter to prior year quarter (4)		-5.79	%		-4.38	%		-2.66	%		2.46	%		8.10	%
Revenue growth, current quarter to prior quarter, annualized (4)		10.22	%		-12.53	%		-10.93	%		-9.71	%		16.43	%
Net interest income growth, current quarter to prior year quarter		-10.43	%		-5.69	%		-6.21	%		0.63	%		1.27	%
Net interest income growth, current quarter to prior quarter, annualized		-25.28	%		0.72	%		-12.41	%		-6.28	%		-5.18	%

(1) The Company adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” or FIN 48 effective January 1, 2007 and as a result recognized a $4.5 million reserve for uncertain tax positions which was recorded as a reduction to the beginning balance of retained earnings as of January 1, 2007.

(2) Core loans calculated as total loans less purchased residential mortgage loans.

(3) Core deposits calculated as total deposits less institutional and brokered time deposits.

(4) Revenue is the sum of net interest income before (reversal of) / provision for credit losses and total non-interest income.

(5) Restated Q1, Q2 and Q3 2006 to reflect adoption of SEC Staff Accounting Bulletin No. 108 effective January 1, 2006.

Greater Bay Bancorp

Financial Results for the First Quarter of 2007

May 4, 2007

Page 9 of 11

GREATER BAY BANCORP

March 31, 2007 - FINANCIAL SUMMARY (UNAUDITED)

(Dollars in 000's)

SELECTED AVERAGE BALANCE SHEET AND YIELD DATA:

	Three months ended
	March 31, 2007							December 31, 2006
Tax-Equivalent Basis (1)	Average balance (2)		Interest			Average yield / rate		Average balance (2)		Interest			Average yield / rate
INTEREST-EARNING ASSETS:
Fed funds sold	$	63,223	$	815		5.23	%	$	83,034	$	1,098		5.24	%
Securities:
Taxable		1,441,326		16,588		4.67	%		1,493,073		17,358		4.61	%
Tax-exempt (1)		92,071		1,582		6.97	%		92,347		1,595		6.85	%
Other short-term (3)		8,424		84		4.03	%		9,643		90		3.69	%
Loans and leases (4)		4,869,674		94,910		7.90	%		4,850,605		96,673		7.91	%
Total interest-earning assets		6,474,718		113,979		7.14	%		6,528,702		116,814		7.10	%
Noninterest-earning assets		866,562		—					889,484		—
Total assets	$	7,341,280		113,979				$	7,418,186		116,814
INTEREST-BEARING LIABILITIES:
Deposits:
MMDA, NOW and Savings	$	2,603,938		18,810		2.93	%	$	2,611,369		17,545		2.67	%
Time deposits over $100,000		877,491		10,881		5.03	%		827,608		10,312		4.94	%
Other time deposits		747,657		9,072		4.92	%		727,388		8,895		4.85	%
Total interest-bearing deposits		4,229,086		38,763		3.72	%		4,166,365		36,752		3.50	%
Short-term borrowings		369,591		4,489		4.93	%		393,702		4,873		4.91	%
CODES		—		—		0.00	%		—		—		0.00	%
Subordinated debt		180,929		3,711		8.32	%		180,929		3,768		8.26	%
Other long-term borrowings		494,409		6,609		5.42	%		526,025		7,026		5.30	%
Total interest-bearing liabilities		5,274,016		53,572		4.12	%		5,267,021		52,419		3.95	%
Noninterest-bearing deposits		948,232							1,021,175
Other noninterest-bearing liabilities		256,393							271,643
Minority Interest: Preferred stock of real estate investment trust subsidiaries		12,876							12,837
Shareholders’ equity		849,763							845,510
Total shareholders’ equity and liabilities	$	7,341,280		53,572				$	7,418,186		52,419
Net interest income, on a tax-equivalent basis (1)				60,407							64,395
Net interest margin (5)						3.78	%						3.91	%
Reconciliation to reported net interest income:
Adjustment for tax-equivalent basis				(500	)						(506	)
Net interest income, as reported			$	59,907						$	63,889

(1) Income from tax-exempt securities issued by state and local governments or authorities, is adjusted by an increment that equates tax-exempt income to tax equivalent basis (assuming a 35% federal income tax rate).

(2) Nonaccrual loans are included in the average balance.

(3) Includes average interest-earning deposits in other financial institutions.

(4) Amortization of deferred costs and fees, net, resulted in an increase of interest income on loans by $592,000 and $674,000, for the three months ended March 31, 2007 and December 31, 2006, respectively.

(5) Net interest margin during the period equals (a) the difference between tax-equivalent interest income on interest-earning assets and the interest expense on interest-bearing liabilities, divided by (b) average interest-earning assets for the period, annualized.

Greater Bay Bancorp

Financial Results for the First Quarter of 2007

May 4, 2007

Page 10 of 11

GREATER BAY BANCORP

March 31, 2007 - FINANCIAL SUMMARY (UNAUDITED)

(Dollars in 000's)

SELECTED AVERAGE BALANCE SHEET AND YIELD DATA:

	Three months ended
	March 31, 2007							March 31, 2006
Tax-Equivalent Basis (1)	Average balance (2)		Interest			Average yield / rate		Average balance (2)		Interest			Average yield / rate
INTEREST-EARNING ASSETS:
Fed funds sold	$	63,223	$	815		5.23	%	$	12,290	$	132		4.34	%
Securities:
Taxable		1,441,326		16,588		4.67	%		1,425,340		15,622		4.45	%
Tax-exempt (1)		92,071		1,582		6.97	%		82,596		1,494		7.33	%
Other short-term (3)		8,424		84		4.03	%		9,762		35		1.46	%
Loans and leases (4)		4,869,674		94,910		7.90	%		4,721,031		87,220		7.49	%
Total interest-earning assets		6,474,718		113,979		7.14	%		6,251,019		104,503		6.78	%
Noninterest-earning assets		866,562		—					885,077		—
Total assets	$	7,341,280		113,979				$	7,136,096		104,503
INTEREST-BEARING LIABILITIES:
Deposits:
MMDA, NOW and Savings	$	2,603,938		18,810		2.93	%	$	2,950,240		14,072		1.93	%
Time deposits over $100,000		877,491		10,881		5.03	%		756,259		7,321		3.93	%
Other time deposits		747,657		9,072		4.92	%		260,812		2,368		3.68	%
Total interest-bearing deposits		4,229,086		38,763		3.72	%		3,967,311		23,761		2.43	%
Short-term borrowings		369,591		4,489		4.93	%		288,491		2,983		4.19	%
CODES		—		—		0.00	%		75,101		101		0.55	%
Subordinated debt		180,929		3,711		8.32	%		210,311		4,557		8.79	%
Other long-term borrowings		494,409		6,609		5.42	%		474,316		5,732		4.90	%
Total interest-bearing liabilities		5,274,016		53,572		4.12	%		5,015,530		37,134		3.00	%
Noninterest-bearing deposits		948,232							1,041,806
Other noninterest-bearing liabilities		256,393							281,996
Minority Interest: Preferred stock of real estate investment trust subsidiaries		12,876							12,715
Shareholders’ equity		849,763							784,049
Total shareholders’ equity and liabilities	$	7,341,280		53,572				$	7,136,096		37,134
Net interest income, on a tax-equivalent basis (1)				60,407							67,369
Net interest margin (5)						3.78	%						4.37	%
Reconciliation to reported net interest income:
Adjustment for tax-equivalent basis				(500	)						(488	)
Net interest income, as reported			$	59,907						$	66,881

(1) Income from tax-exempt securities issued by state and local governments or authorities, is adjusted by an increment that equates tax-exempt income to tax equivalent basis (assuming a 35% federal income tax rate).

(2) Nonaccrual loans are included in the average balance.

(3) Includes average interest-earning deposits in other financial institutions.

(4) Amortization of deferred costs and fees, net, resulted in an increase of interest income on loans by $592,000 and $245,000 for the three months ended March 31, 2007 and March 31, 2006, respectively.

(5) Net interest margin during the period equals (a) the difference between tax-equivalent interest income on interest-earning assets and the interest expense on interest-bearing liabilities, divided by (b) average interest-earning assets for the period, annualized.

Greater Bay Bancorp

Financial Results for the First Quarter of 2007

May 4, 2007

Page 11 of 11

GREATER BAY BANCORP

March 31, 2007 - FINANCIAL SUMMARY (UNAUDITED)

(Dollars and shares in 000's, except per share data)

SELECTED CONSOLIDATED CREDIT QUALITY DATA:

	Mar 31 2007			Dec 31 2006			Sep 30 2006			Jun 30 2006			Mar 31 2006
Nonperforming assets
Commercial:
Matsco/GBC	$	9,160		$	7,583		$	8,323		$	7,257		$	8,011
SBA		6,456			5,576			2,881			4,536			3,627
Other		7,769			8,486			6,458			4,775			9,184
Total commercial		23,385			21,645			17,662			16,568			20,822
Real estate:
Commercial		6,180			7,173			10,939			14,763			8,203
Construction and land		1,980			930			323			323			3,242
Other		—			—			—			3			7
Total real estate		8,160			8,103			11,262			15,089			11,452
Consumer and other		74			117			139			611			718
Total nonaccrual loans		31,619			29,865			29,063			32,268			32,992
OREO		—			—			—			—			—
Other nonperforming assets		435			382			603			361			438
Total nonperforming assets	$	32,054		$	30,247		$	29,666		$	32,629		$	33,430
Net loan charge-offs (recoveries) (1)	$	1,122		$	3,192		$	223		$	2,662		$	43
Ratio of allowance for loan and lease losses to:
End of period loans		1.35	%		1.39	%		1.48	%		1.50	%		1.58	%
Total nonaccrual loans		208.6	%		227.8	%		245.4	%		222.2	%		226.0	%
Ratio of quarter (reversal of) / provision for credit losses to quarter average loans, annualized		-0.09	%		-0.03	%		-0.04	%		-0.16	%		-0.52	%
Total nonaccrual loans to total loans		0.64	%		0.61	%		0.60	%		0.68	%		0.70	%
Total nonperforming assets to total assets		0.43	%		0.41	%		0.40	%		0.44	%		0.47	%
Ratio of quarterly net loan charge-offs to average loans, annualized		0.09	%		0.26	%		0.02	%		0.23	%		0.00	%
Ratio of YTD net loan charge-offs to YTD average loans		0.09	%		0.13	%		0.08	%		0.12	%		0.00	%
(1)    Net loan charge-offs are loan charge-offs net of recoveries. Q3 2006 includes an insurance recovery of $1.6 million related to a previously charged-off loan. SELECTED QUARTERLY CAPITAL RATIOS AND DATA:
	Mar 31 2007			Dec 31 2006			Sep 30 2006			Jun 30 2006			Mar 31 2006
Tier 1 leverage ratio		10.92	%		10.63	%		10.63	%		12.07	%		10.77	%
Tier 1 risk-based capital ratio		12.61	%		12.26	%		12.15	%		13.49	%		12.48	%
Total risk-based capital ratio		13.79	%		13.47	%		13.40	%		14.93	%		13.73	%
Total equity to assets ratio		11.53	%		11.39	%		11.40	%		11.04	%		11.14	%
Common equity to assets ratio		10.13	%		9.99	%		9.99	%		9.64	%		9.69	%
Tier I capital	$	769,415		$	755,860		$	748,071		$	824,154		$	734,692
Total risk-based capital	$	841,821		$	830,461		$	825,036		$	911,802		$	808,436
Risk weighted assets	$	6,103,632		$	6,166,011		$	6,155,489		$	6,108,101		$	5,889,032
NON-GAAP RATIOS (1):
Tangible common equity to tangible assets (2)		6.47	%		6.32	%		6.32	%		5.95	%		5.84	%
Tangible common book value per common share (3)	$	8.99		$	8.78		$	8.74		$	8.28		$	7.93
Common book value per common share (4)	$	14.65		$	14.46		$	14.36		$	13.97		$	13.71
Total common shares outstanding		51,044			50,938			51,047			50,917			50,288

(1) The following table provides a reconciliation of common equity to tangible common equity and total assets to tangible assets:

Common shareholders’ equity	$	747,760		$	736,418		$	733,279		$	711,080		$	689,417
Less: goodwill and other Intangible assets		(289,085	)		(288,994	)		(287,202	)		(289,570	)		(290,733	)
Tangible common equity	$	458,675		$	447,424		$	446,077		$	421,510		$	398,684
Total assets	$	7,382,328		$	7,371,134		$	7,339,810		$	7,376,109		$	7,114,581
Less: goodwill and other intangible assets		(289,085	)		(288,994	)		(287,202	)		(289,570	)		(290,733	)
Tangible assets	$	7,093,242		$	7,082,140		$	7,052,608		$	7,086,539		$	6,823,848

(2) Computed as common shareholders’ equity, less goodwill and other intangible assets divided by tangible assets.

(3) Computed as common shareholders’ equity, less goodwill and other intangible assets divided by total common shares outstanding.

(4) Computed as common shareholders’ equity divided by common shares outstanding.