American Bank Reports Third Quarter Earnings

CONTACT: Mark W. Jaindl, President and Chief Executive Officer
Allentown, PA, Thursday, October 18, 2007

Allentown, PA, October 18, 2007 – American Bank Incorporated (OTC BB: AMBK.OB), the parent company of American Bank, today announced earnings for the quarter and nine months ended September 30, 2007. Net income for the quarter was $651,000, or $0.11 per diluted share, a decrease of $83,000 from $734,000, or $0.12 per diluted share, for the same period in the prior year. The decrease in net income for the quarter was the result of an increase in the provision for loan losses of $129,000 and an increase in operating expense of $85,000. The increase in the provision for loan losses related to an increase in loan growth during the quarter, as the quality of American Bank’s loan portfolio remains strong with non-performing loans comprising approximately $65,000 or 0.01% of total assets. The increase in operating expense for the quarter was attributable to an increase of $42,000 in salary and benefit costs and $48,000 in federal deposit insurance premiums. The Federal Deposit Insurance Corporation began assessing insurance premiums in January of 2007.

Net interest income for the quarter ended September 30, 2007 was $2.5 million, an increase of $72,000 from the prior year quarter ended September 30, 2006. The increase in net interest income was a result of the improvement in the Company’s net interest margin to 2.07% for the quarter ended September 30, 2007 from 1.90% for the same quarter in the prior year.

Net income for the nine months ended September 30, 2007 was $3.4 million, or $0.52 per diluted share, an increase of $1.2 million, from $2.2 million, or $0.33 per diluted share, for the nine months ended September 30, 2006. The increase in net income was primarily the result of after-tax gains on available for sale securities of $1.6 million, partially off-set by an increase in operating expense of $400,000 for the nine months ended September 30, 2007 compared to the same period in 2006. The increase in operating expense for the nine months ended September 30, 2007 results from an increase of $197,000 in salary and benefit costs, $115,000 in legal and other professional fees associated with the Company’s deregistration and $135,000 in federal deposit insurance premiums.

On September 18, 2007, the Board of Directors of American Bank, Inc. declared a quarterly dividend of $0.05 per share of common stock and $0.05 per share of series A preferred stock to shareholders of record on October 1, 2007 and payable on October 14, 2007.

American Bank, Inc. common stock (AMBK.OB) last traded at $8.50 per share. American Bank, Inc. series A preferred stock (AMBKO.OB) is listed on the OTC BB but has not traded to date. American Capital Trust I Preferred Securities (AMBKP.OB) last traded at $9.00.

About American Bank
American Bank, a locally-owned community bank based in Allentown, PA, offers a complete selection of banking products and services to suit the needs of consumers and businesses and includes checking, money market, savings, certificates of deposit, consumer and commercial loans and Visa credit cards. American Bank is dedicated to providing customers superior, personalized customer service while offering some of the best loan and deposit rates available and as a result, has received the Bankrate.com® Top Tier award for consistently offering annual percentage yields (APYs) that were among the highest reported. Their online banking service, pcbanker, allows customers to bank conveniently and delivers a full range of real-time online banking services free of charge including online bill payment and presentment, ACH Direct, transfers between accounts, transaction history, check images and e-Statements. American Bank is FDIC insured.

American Bank Online and pcbanker.com are registered marks for the Internet financial services provided by American Bank, a state-chartered, FDIC insured full-service financial institution serving customers throughout the United States. American Bank is a member of the Federal Reserve System.

Forward-Looking Statements
Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of those terms. Forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Bank operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, risks associated with the conduct of the Bank's business over the internet, credit risk management, asset-liability management, the financial and securities markets and the availability of and costs associated with sources of liquidity.

The Bank wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Bank wishes to advise readers that the factors listed above could affect the Bank's financial performance and could cause the Bank's actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Bank does not undertake and specifically declines any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

For additional information, please contact Mark W. Jaindl, President and Chief Executive Officer.