Idaho First Bank Reports Results, Stock Offering and New Directors

Today, Idaho First Bank (OTCBB: IDFB) reported mid-year financial results. The Bank experienced significant growth during the first half of 2008. Loans grew to $42.1 million, a 92% increase from June 30, 2007. Deposits grew by 72% during the same period to $45.7 million at June 30, 2008.

The net loss reported for the first half of 2008 was $1,055,000 compared to a loss of $549,000 in the first half of 2007. The increased loss was caused by the provision for loan losses being $475,000, compared to $33,000 last year in the first half. This major increase in the provision for loan losses was caused by the large growth in loans and the decision to charge off a $348,000 nonperforming loan in the first quarter of the year. There were no loan charge-offs in the second quarter of 2008, and the quarterly net loss for the second quarter of 2008 was $327,000, compared to the $728,000 net loss in the first quarter of 2008.

As of June 30, 2008, there was one nonperforming loan with a balance of $147,000. The Bank's credit quality is stable and oversight has been strengthened to maintain a quality loan portfolio. The Federal Reserve's significant drop in short-term interest rates has had a negative impact on the Bank's net interest margin. Net interest margin in the first half of 2008 was 4.04% compared to 4.51% in the first half of 2007.

Stockholders' equity was $5.3 million at June 30, 2008, and book value per share was $5.38. On June 27, 2008, the Bank began a stock offering to sell $6 million of common stock at $5.00 per share. For every two shares that are purchased at this price the purchaser will receive a warrant entitling them to buy one additional share at a price of $7.00 per share, at anytime before September 30, 2011. This stock offering is necessary to support the rapid growth of the Bank and to allow the Bank to achieve profitability. Offering Circulars were mailed to shareholders on July 9. Offering Circulars are available by contacting Greg Lovell or Don Madsen at the phone numbers listed below.

The Board of Directors has voted to add, subject to approval by the State of Idaho and the FDIC, two new Board members. These two potential directors agreed to purchase 300,000 shares ($1.5 million) in the stock offering, which is a significant vote of confidence in the Bank and the progress the Bank has made.

President and CEO Greg Lovell said, "One new director will be Mark Miller who is a Boise native who spends considerable time in McCall. His business background includes running his family's private equity firm. His wife Jennifer is a well-known orthopedic surgeon in Boise. Their family company has been a significant shareholder from the Bank's inception. The other new director is William Riddle of Dallas, Texas. Mr. Riddle has extensive experience in the health care industry and is a regular visitor to our area. He has substantial business investments in and a deep affection for McCall. He has been a long-time client of the Bank and provides financial expertise as well as a strong history of growing and improving businesses."