Idaho Bancorp Reports Third Quarter Results

Today Idaho Bancorp (the "Company") (OTCBB: IDBC) reported that its wholly owned subsidiary, Idaho Banking Company, continues to be "well capitalized" with total risk based capital of 10.87%, based on the 10.00% regulatory standard for such designation.

In light of continued economic weakness, the Company increased its allowance for loan losses by $3,952,000 and charged off $4,548,000 in net loan losses, resulting in a reserve of 4.33% of outstanding loans at September 30, 2009 compared to 1.51% and 2.17% as of September 30, 2008 and December 31, 2008, respectively. These actions resulted in a net loss for the Company of $7,438,000 for the nine months ended September 30, 2009 compared to a net income of $159,000 for the nine months ended September 30, 2008. The reported loss represents ($4.04) per share compared to a net income of $0.09 per share for the first nine months of 2008. The book value per share was $4.43 and $9.63 as of September 30, 2009 and 2008, respectively.

Highlights

--  The Company's Home Loan Center increased non-interest income by
    $284,000, or 52%, when comparing the nine-month periods ended September 30,
    2009 and 2008, respectively
--  The Company's in-market core deposits, excluding certificates of
    deposit, increased $17,958,000, or 25.9% when comparing balances at
    September 30, 2009 to balances at September 30, 2008
    

The Company's nonperforming assets were $19,823,000 and $11,287,000 at September 30, 2009 and December 31, 2008, respectively. The Company's loans considered to be more than thirty days past due and still on accrual status were $5,451,000, or 2.77% of outstanding loans, at September 30, 2009 compared to $491,000 at December 31, 2008. Included above for September 30, 2009 is $1,395,000 in one loan ninety days or more past due and still accruing interest. There were no loans more than ninety days past due and still accruing interest as of December 31, 2008.

The net interest margin for the nine-month period ended September 30, 2009 was 3.56% compared to 3.88% for the same time period in 2008. Net interest income was reduced by approximately $596,000 due to the reversal of earned interest and lost potential interest income resulting from non-accrual loans. This lost interest income accounts for 35 basis points in the reduction of the year-to-date net interest margin for 2009. Excluding the impact of non-accrual loans, the net interest margin would have improved 3 basis points. That improvement in the net interest margin is partially due to the Company's continued focus on growing lower costing core deposits with products like the Perfectly Free Non-Interest Business Checking product.

The Company has had significant improvements in its 2009 non-interest income compared to 2008. The Company's Home Loan Center, through the origination of held-for-sale residential mortgage loans, has increased its non-interest income by $284,000, or 52%, when comparing the nine-month periods ended September 30, 2009 to 2008, respectively. The Company's Home Loan Center continues to be very active in providing funds for individuals and families looking to buy or refinance homes in the Idaho market.

The Company continues to focus on reducing its non-interest expenses. The Company has reduced its full time equivalent employees to 80 as of September 30, 2009 from 86 at September 30, 2008. The 2009 year-to-date salaries, excluding mortgage commissions and 2008 one time charges, have declined by approximately $211,000 from the same time period in 2008. The Company has cut year-to-date costs for travel and entertainment, supplies, postage and freight and various other costs. However, due to increased FDIC fee assessments for all insured banks, the Company's 2009 year-to-date FDIC insurance costs have increased by $284,000, or 301% from the costs recognized in 2008 for the same time period.

Idaho Bancorp is the parent company of Idaho Banking Company, a state-chartered commercial bank and member of the Federal Reserve, which was organized in 1996 and operates four branch offices, and a construction & mortgage home loan center. The Company serves clients throughout southwestern Idaho.

This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 ("PSLRA"). Such forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected, including but not limited to the following: the concentration of loans of the company's banking subsidiary, particularly with respect to commercial and residential real estate lending; a continued decline in the housing and real estate market, changes in the regulatory environment and increases in associated costs, particularly ongoing compliance expenses and resource allocation needs in response to regulatory rules and guidelines; vendor quality and efficiency; employee recruitment and retention; the company's ability to control risks associated with rapidly changing technology both from an internal perspective as well as for external providers; increased competition among financial institutions; fluctuating interest rate environments; a tightening of available credit, and similar matters. Readers are cautioned not to place undue reliance on the forward-looking statements. Idaho Bancorp undertakes no obligation to publicly revise or update the forward-looking statements to reflect events or circumstances that arise after the date of this release. This statement is included for the express purpose of invoking PSLRA's safe harbor provisions.

                        Idaho Bancorp and Subidiary
              Consolidated Financial Highlights (unaudited)
                 (Dollars in thousands, except per share)


For the nine months ended
 September 30:                    2009       2008     $ Change   % Change
                                ---------  ---------  ---------  ---------
  Net interest income           $   5,977  $   6,486  $    (509)        -8%
  Provision for loan losses         8,500        605      7,895       1305%
  Mortgage banking income             827        543        284         52%
  Other non-interest income           401        391         10          3%
  Non-interest expense              6,604      6,621        (17)         0%
  Net income / (loss) before
   taxes                           (7,899)       194     (8,093)     -4172%
  Income taxes                       (461)        35       (496)     -1417%
  Net income / (loss)              (7,438)       159     (7,597)     -4778%

  Income / (loss) per share
    Basic                           (4.04)      0.09      (4.13)     -4589%
    Diluted                         (4.04)      0.09      (4.13)     -4589%

At September 30:                   2009       2008    $ Change   % Change
                                ---------  ---------  ---------  ---------
  Loans                         $ 196,606  $ 199,788  $  (3,182)        -2%
  Allowance for loan losses         8,505      3,024      5,481        181%
  Assets                          239,567    239,051        516          0%
  Deposits                        198,240    181,288     16,952          9%
  Shareholders' equity             15,110     17,724     (2,614)       -15%
  Nonperforming loans              18,153      2,158     15,995        N/A
  Other real estate owned *         1,670        336      1,334        N/A

  Book value per share               4.43       9.63      (5.20)       -54%
  Shares of common stock
   outstanding                  1,841,128  1,839,860      1,268          0%

  Allowance to loan ratio            4.33%      1.51%
  Allowance to nonperforming
   loans                               47%       140%
  Nonperforming loans to total
   loans                             9.23%      1.08%

Averages for the nine months
 ended September 30:               2009       2008    $ Change   % Change
                                ---------  ---------  ---------  ---------
  Loans                         $ 199,297  $ 193,672  $   5,625          3%
  Earning assets                  228,188    226,537      1,651          1%
  Assets                          237,354    236,730        624          0%
  Deposits                        185,878    182,445      3,433          2%
  Shareholders' equity             20,002     17,763      2,239         13%

For the nine months ended
 September 30:
  Return on average assets          -4.19%      0.09%
  Return on average equity         -49.72%      1.20%
  Average loans to deposits        107.22%    106.15%
  Net interest margin - tax
   equivalent                        3.56%      3.88%
  Net loan charge-offs
   (recoveries)                     4,548        204
  Net charge-offs (recoveries)
   to loans (annualized)             3.05%      0.14%

* Includes only retaken property.





                       Idaho Bancorp and Subsidiary
          Quarterly Consolidated Financial Highlights (unaudited)
                 (Dollars in thousands, except per share)


                          2009 Q3   2009 Q2   2009 Q1   2008 Q4   2008 Q3
                          --------  --------  --------  --------  --------
  Net interest income     $  1,914  $  1,943  $  2,120  $  2,084  $  2,250
  Provision for loan
   losses                    1,600     6,200       700     4,104       260
  Mortgage banking income      204       281       342       100       168
  Other non-interest
   income                      131       135       135       118       135
  Non-interest expense       2,118     2,314     2,172     1,718     2,044
  Net income / (loss)
   before taxes             (1,469)   (6,155)     (275)   (3,520)      249
  Income tax expense /
   (benefit)                     0      (335)     (126)     (237)       80
  Net income / (loss)       (1,469)   (5,820)     (149)   (3,283)      169

  Earnings / (loss) per
   share
    Basic                    (0.80)    (3.16)    (0.08)    (1.16)     0.09
    Diluted                  (0.80)    (3.16)    (0.08)    (1.16)     0.09

  Average loans            197,760   196,244   204,018   202,910   197,948
  Average earning assets   227,605   224,179   232,901   231,809   227,730
  Average assets           235,053   234,648   242,591   242,032   238,021
  Average deposits         191,850   181,921   183,895   180,689   176,924
  Average shareholders'
   equity                   16,095    21,896    22,081    17,703    17,763

  Return on average
   assets                    -2.48%    -9.95%    -0.25%    -5.40%     0.28%
  Return on average
   equity                   -36.21%  -106.61%    -2.74%   -73.78%     3.78%
  Average loans to
   deposits                 103.08%   107.87%   110.94%   112.30%   111.88%
  Net interest margin -
   tax equivalent             3.39%     3.53%     3.75%     3.63%     3.99%

  Nonperforming loans -
   period end             $ 18,153  $ 14,508  $  7,637  $ 10,907  $  2,158
  Other real estate owned
   - period end *            1,670     1,437     1,155       380       336
  Loans - period end       196,606   196,341   193,404   209,648   199,788
  Allowance for loan
   losses - period end       8,505     7,583     4,118     4,553     3,024
  Net charge-offs
   (recoveries) -
   quarterly                   678     2,735     1,135     2,575       104

  Allowance to loans          4.33%     3.86%     2.13%     2.17%     1.51%
  Allowance to
   nonperforming loans          47%       52%       54%       42%      140%
  Nonperforming loans to
   total loans                9.23%     7.39%     3.95%     5.20%     1.08%
  Net charge-offs to
   loans - annualized         1.36%     5.59%     2.26%     5.05%     0.21%

* Includes only retaken property.

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