Idaho Banking Company

Idaho Banking Company Reports Quarterly Results

BOISE, April 22 /PR Newswire-First Call/ -- Idaho Banking Company (OTC Bulletin Board: IBCB) today reported net income of $27,000, or $.03 per share for the first quarter of 2002. This is $5,000 less than net income in the first quarter of 2001. The major reasons for the decline were a lower net interest margin and lower gains from the sale of SBA loans. Earnings continue to be negatively impacted by loan charge-offs, causing a high level of provision for loan losses. Net loan charge-offs were $245,000 in the first quarter, compared to $134,000 a year ago. Although nonperforming loans represent .73% of loans at March 31, 2002, they have improved from the high of .86% of loans on September 30, 2001.

Net interest margin was 4.20% in the first quarter of 2002, compared to 4.49% in the first quarter of 2001. The rapid decline in interest rates throughout 2001 had a negative impact on net interest margin, as the yields on earning assets fell more rapidly than the cost of funds. As interest rates have stabilized in the first quarter, the bank’s net interest margin is gradually improving. The first quarter net interest margin of 4.20% represents a 17 basis point improvement from the low point of 2001 in the fourth quarter. Although activity in the bank’s mortgage division slowed from the fourth quarter of 2001 to the first quarter of 2002, management is pleased to report operations in this area continue to be profitable.

Loans have declined by 1% in the past twelve months as a result of the Bank’s efforts to discontinue loan relationships with marginal credit quality and the implementation of stricter underwriting requirements on new loans. Shareholders’ equity remained strong, with a capital to asset ratio of 11.22% at March 31, 2002.

Idaho Banking Company, a state-chartered commercial bank and member of the Federal Reserve Bank, was organized in 1996. Its primary emphasis is providing personalized service and local decision-making for clients seeking a change from the automated and impersonal "big bank" atmosphere. The bank operates from three branch offices and one mortgage office in Ada County.

Source: Idaho Banking Company

Contacts: Michael K. Johnston, President & CEO at 208-472-4702, Mary E. Brimson, VP Shareholder Relations at 208-472-4705, or Don D. Madsen, CFO at 208-947-1880

Idaho Banking Company
Financial Highlights (unaudited)
(dollars in thousands)

								Change
For the three months ended March 31:			2002		2001		$		%
	Net interest income		$ 949		$ 969		$ (20)		-2%
	Provision for loan losses		180		175		5		3%
	Mortgage banking income		280		181		99		55%
	Gains on loan sales		6		29		(23)		-79%
	Other noninterest income		78		103		(25)		-24%
	Noninterest expense		1,096		1,067		29		3%
	Net income before taxes		37		40		(3)		-8%
	Income taxes		10		8		2		25%
	Net income		27		32		(5)		-16%

	Net income per share
		Basic	0.03		0.04		(0.01)		-25%
		Diluted	0.03		0.04		(0.01)		-25%

								Change
At March 31:			2002		2001		$		%
	Loans		$ 66,329		$ 67,105		$ (776)		-1%
	Allowance for loan losses		1,194		916		278		30%
	Assets		96,032		96,601		(569)		-1%
	Deposits		75,874		80,433		(4,559)		-6%
	Shareholders' equity		10,775		10,067		708		7%
	Nonperforming loans		485		121		364		301%
	Other real estate owned		65		65		0		0%

	Book value per share		12.83		12.84		(0.01)		0%

	Allowance to loan ratio		1.80%		1.37%
	Allowance to nonperforming loans		2.5	X	7.6	X
	Nonperforming loans to total loans		0.73%		0.18%
								Change
Averages for three months ended March 31:			2002		2001		$		%
	Loans		$ 69,701		$ 67,089		$ 2,612		4%
	Earning assets		93,901		89,266		4,635		5%
	Assets		98,762		95,361		3,401		4%
	Deposits		74,950		78,949		(3,999)		-5%
	Shareholders' equity		10,588		10,006		582		6%

For the three months ended March 31:
	Return on average assets		0.11%		0.14%
	Return on average equity		1.03%		1.30%
	Average loans to deposits		93.00%		84.98%
	Net interest margin - tax equivalent		4.20%		4.49%
	Net loan charge-offs		245		134
	Net charge-offs to loans		1.43%		0.81%

Quarterly Trends (Unaudited)			2002 Q1		2001 Q4		2001 Q3		2001 Q2		2001 Q1
	Net interest income		$ 949		$ 952		$ 980		$ 974		$ 969
	Provision for loan losses		180		300		380		190		175
	Mortgage banking income		280		349		332		297		181
	Gains on loan sales		6		15		0		33		29
	Other noninterest income		78		82		85		89		103
	Noninterest expense		1,096		1,114		1,069		1,149		1,067
	Net income before taxes		37		(16)		(52)		54		40
	Income taxes		10		(18)		(30)		0		8
	Net income		27		2		(22)		54		32

	Net income per share
		Basic	0.03		0.00		(0.03)		0.07		0.04
		Diluted	0.03		0.00		(0.03)		0.07		0.04

	Average loans		69,701		72,171		72,534		69,994		67,089
	Average earning assets		93,901		95,791		93,059		91,781		89,266
	Average assets		98,762		101,101		99,147		97,551		95,361
	Average deposits		74,950		80,562		81,072		79,535		78,949
	Average shareholders' equity		10,588		10,101		10,099		10,009		10,006

	Return on average assets		0.11%		0.01%		-0.09%		0.22%		0.14%
	Return on average equity		1.03%		0.08%		-0.86%		2.16%		1.30%
	Average loans to deposits		93.00%		89.58%		89.47%		88.00%		84.98%
	Net interest margin - tax equivalent		4.20%		4.03%		4.26%		4.35%		4.49%

	Nonperforming loans - period end		$ 485		$ 567		$ 622		$ 358		$ 121
	Other real estate owned - period end		65		65		65		65		65
	Loans - period end		66,329		71,832		72,673		70,785		67,105
	Allowance for loan losses - period end		1,194		1,259		1,192		929		916
	Net charge-offs (recoveries) - quarterly		245		233		117		177		134

	Allowance to loans		1.80%		1.75%		1.64%		1.31%		1.37%
	Allowance to nonperforming loans		2.5	X	2.2	X	1.9	X	2.6	X	7.6	X
	Nonperforming loans to total loans		0.73%		0.79%		0.86%		0.51%		0.18%
	Net charge-offs to loans - annualized		1.43%		1.28%		0.64%		1.01%		0.81%