Treasure State Bank Reports Second Quarter 2008 Results

MISSOULA, Mont.--(BUSINESS WIRE)--Treasure State Bank (OTCBB:TRSU) today announced its first quarterly profit since operations commenced in January 2007.

• Total assets increased to $77.6 million as of June 30, 2008, a 30.2% increase in total assets from the end of the first quarter 2008.
• Growth was driven by strong loan demand. Gross loans grew by 25.7% to $61.2 million from $48.7 million at the end of the first quarter.
• Deposits grew to $63.6 million from $47.2 million in the previous quarter, an increase of 34.8%.
• Loan growth generated a 26.2% increase in net interest income to $715 thousand, compared to net interest income of $528 thousand for the first quarter 2008.
• Treasure State Bank experienced no loan losses for the quarter but increased its loan loss reserve to 1.40% of total loans in response to overall economic conditions and the potential impact on borrowers.
• The bank generated a net profit of $80 thousand in the second quarter compared to a $19 thousand net loss in the first quarter 2008.
• Earnings per share were $0.07 for the second quarter 2008, compared to a loss of $0.02 per share for the first quarter 2008.
• Ending book value was relatively unchanged at $9.5 million, or $8.61 per share.

“The board of directors and senior management are pleased with the results,” said Shelley Boutelle, President and CEO of Treasure State Bank. “In the second quarter 2008, the Bank generated its first quarterly profit, on target with our expectations. The Bank's efficiency ratio for the quarter was 64.6%. We are very pleased with this relatively low ratio because the current quarter includes the full effects of the cost of our new building and increases in staffing levels and related compensation expense. To date, national economic challenges have had a lesser impact on the Missoula marketplace than other metropolitan areas. Nevertheless, the board of directors and management believe a conservative approach is justified and will moderate growth and diversify the loan portfolio going forward to manage potential risks. The board of directors and senior management are confident this approach, combined with a strong capital position and loan loss reserve, will sustain the institution in the event of a local economic slowdown.”

About Treasure State Bank

Treasure State Bank, a state chartered bank, is headquartered in Missoula, Montana. The bank was founded in January 2007 with a capital base of $11 million, the most capital ever raised by a Montana de novo bank. Treasure State Bank currently trades on the Over the Counter Bulletin Board (OTCBB) under the ticker symbol “TRSU.” Treasure State Bank serves businesses, professionals, non-profit organizations and individuals through customized banking services and products. For more information, please visit www.treasurestatebank.com.