Unassociated Document

Lake Oswego, OR – April 27, 2009 – West Coast Bancorp (NASDAQ: WCBO) today announced a loss in the first quarter of 2009 of $23.6 million or $1.52 per diluted share including a noncash goodwill impairment charge of $13.1 million after-tax or $.84 per diluted share. The operating loss* was $10.5 million or $.68 per diluted share in the first quarter of 2009, compared to operating income of $2.0 million or $.13 per diluted share in the same quarter of 2008. The goodwill impairment charge eliminated the entire amount of the Company’s previously recorded goodwill associated with the purchase of Mid-Valley Bank in June 2006. Goodwill impairment is a noncash accounting charge that does not affect capital, regulatory capital ratios, cash flows or liquidity.

	GAAP									Operating*
	Three months ended									Three months ended
(Dollars in thousands,	March 31,									March 31,
except per share data, unaudited)	2009			2008			Change			2009			2008

For the three months ended:
Net (loss) income	$	(23,599	)	$	2,000			-1280	%	$	(10,540	)	$	2,000
Net (loss) income per diluted share	$	(1.52	)	$	0.13			-1269	%	$	(0.68	)	$	0.13

Return on average equity		-48.5	%		3.8	%		-52.3	%		-21.7	%		3.8	%

West Coast Bank Tier 1 capital ratio		9.43	%		9.32	%		0.11	%
West Coast Bank Total capital ratio		10.68	%		10.57	%		0.11	%
West Coast Bank leverage ratio		8.92	%		8.84	%		0.08	%

West Coast Bancorp Tier 1 capital ratio		9.72	%		9.96	%		-0.24	%
West Coast Bancorp Total capital ratio		10.97	%		11.22	%		-0.25	%
West Coast Bancorp leverage ratio		9.19	%		9.49	%		-0.30	%
West Coast Bancorp common equity to tangible assets		6.96	%		7.43	%		-0.47	%

Total period end loans	$	1,998,451		$	2,194,311			-9	%
Total period end deposits	$	2,052,097		$	2,061,847			0	%

*Operating loss for the quarter ended March 31, 2009, and numbers derived using operating loss for the quarter, including operating loss per diluted share, and operating return on average equity are non-GAAP (Generally Accepted Accounting Principles) financial measures derived by adjusting the Company’s GAAP earnings for the noncash goodwill impairment charge of $13.1 million, after-tax. Management uses this non-GAAP information internally and has disclosed it to investors based on its belief that the information provides additional, valuable information relating to its operating performance as compared to prior periods. See table 1 below for a reconciliation of non-GAAP financial information.

"Despite the very challenging economic conditions and disappointing operating results, we accomplished several very important goals in the first quarter of 2009 compared to the same quarter one year ago,” said Robert D. Sznewajs, President and CEO. “First, West Coast Bank’s total capital ratio at 10.68% increased 11 basis points. Second, we lowered our loan to deposit ratio from 106% to 97%. Third, we reduced our residential land and construction loan exposure by 55% to less than 9% of total loans. And fourth, our cost of interest bearing deposits for the first quarter was 1.74%, an improvement of 118 basis points and amongst the lowest within our markets. Additionally, our allowance for credit losses for loans other than two-step increased to 1.95% from 1.55%.” Sznewajs continued, “As compared to a year ago, and despite these tough economic times, we have improved the Bank’s total capital position, continued to maintain a strong core deposit base at an attractive cost, and significantly reduced our outstanding residential construction loan portfolio, while building our reserve for credit losses. These results are a direct consequence of and consistent with initiatives implemented in late 2007 when the economic crises began.”

Over the past 12 months total loans declined $196 million or 9% to $2.00 billion at March 31, 2009. Excluding the $188 million or 89% reduction in two-step loan balances, total loan balances remained substantially unchanged. While the commercial real estate and residential mortgage loan categories increased over the same time period, the impact of the recession and the challenging residential housing market was evident in both demand for and origination of commercial and construction loans. Consistent with our strategy, the residential construction loan portfolio contracted 57% over the past year, meaningfully reducing the Company’s risk exposure to this sector. At March 31, 2009, the remaining two-step loan balance measured $24 million or 1% of total loans, down from $211 million and 10% a year ago. First quarter 2009 average total deposits of $1.98 billion declined 4% from the same quarter in 2008. The lower average balance per money market account and a reduction in certificate of deposit balances greater than $100,000 explained the decrease in total deposits. The Company’s funding position at March 31, 2009 has improved over the past year with its loan to deposit ratio declining to 97% from 106% a year ago.

As a result of lower average earning asset balances and 25 basis points compression in the net interest margin to 3.67%, first quarter 2009 net interest income declined $3.4 million to $20.1 million from the first quarter last year. The year over year contraction in first quarter net interest margin of 25 basis points was a consequence of the declining benefit from non-interest bearing demand deposits in this unusually low interest rate environment. Despite the decline in construction loan fee income and higher average nonaccrual loan balances, the net interest spread improved 9 basis points in the most recent quarter due to a substantially lower volume of loan interest reversals than in the first quarter of 2008.

Total non-interest income of $4.3 million in the quarter ended March 31, 2009 declined $5.9 million from the same period in 2008. Due to extended weakness in the housing market, first quarter OREO valuation adjustments totaled $4.8 million, of which $4.1 million were associated with two-step properties, compared to no such charges in the same quarter of 2008. However, the loss recorded at the time of final disposition of the 17 two-step OREO properties during the quarter was insignificant suggesting such properties are being written down to realizable value prior to final disposition of the properties. Including 7 short sales, we disposed of a total of 24 two-step related properties during the first quarter for total proceeds of $6.4 million. The disposition volume was down from 41 properties sold for $11.9 million in the fourth quarter of 2008 but in line with the market and seasonal home sales patterns. Evidenced by 36 pending sales, with expected total proceeds of $8.3 million, as of March 31, 2009, we have experienced a substantial acceleration in sales activity beginning in early March, a trend which is continuing in April. Through March 31, 2009, we had cumulative sold or pending sales on 157 two-step properties, including 47 short sales. At the end of the first quarter the two-step OREO portfolio consisted of 296 properties. (See table 7 for details.) Future financial results will be heavily dependent on the Company's ability to dispose of its OREO properties quickly and at prices that are in line with current expectations.

As a result of 5% growth in the number of consumer and business deposit transaction accounts over the past 12 months, first quarter 2009 deposit service charge revenues improved 5% or $.2 million. Directly related to the significant slowing in economic activity, total payment systems revenues remained flat from first quarter of 2008 despite the increase in number of deposit accounts and associated cards. The weak equity markets contributed to a $.7 million or 42% decline in trust and investment revenues over first quarter 2008. First quarter 2009 gain on sales of loans declined $.5 million from first quarter 2008 due to the secondary market for SBA loans effectively being inactive.

First quarter 2009 total non-interest expense of $35.4 million included the $13.1 million goodwill impairment charge. Without this charge, total non-interest expense was $22.3 million, substantially unchanged from the same period of 2008. Also, excluding an increase in the FDIC insurance premium expense of $.6 million and a $.9 million increase in property collection and disposition expenses, total non-interest expense declined 7% from the first quarter of 2008 due to the Company’s sharp focus on reducing controllable expense items. As part of that effort, total personnel expense fell 9% or $1.2 million in the most recent quarter compared to the first quarter of 2008 due to lower salary, incentive and benefit costs.

The Company recorded a first quarter 2009 provision for credit losses of $23.1 million, up from $8.7 million in the same quarter of 2008, and up from $16.5 million in the fourth quarter of 2008. The provision related to the two-step portfolio is trending down as the loan balance contracts. This provision measured $3.1 million in the most recent quarter, down from $4.8 million in the fourth quarter of 2008. Each two-step property is re-appraised within 45 days of its expected foreclosure date. The following table presents the significant decline in the two-step loan portfolio over the past 15 months.

The provision for credit losses associated with loans other than two-step loans was $20.0 million in the first quarter of 2009, up from $7.9 million in the same quarter of 2008 and $11.7 million in the fourth quarter of 2008. The combination of negative risk rating migration, higher net charge-offs, higher general valuation allowances and a significantly larger unallocated allowance contributed to an increased quarterly provision in the most recent quarter under our allowance model compared to the first quarter of 2008. The level of future provisioning will be heavily dependent on the real estate market and general economic conditions nationally and in the areas in which we do business.

As shown in the table below, at March 31, 2009 total residential construction loans, which consist of residential land, site development, vertical construction (construction of residences) and two-step construction loans, measured $177 million or 9% of the total loan portfolio, a material reduction from 18% a year ago. This amounted to a decrease of $220 million or 55% from the same period in 2008. At the end of the most recent quarter, accruing residential construction loans totaled $104 million or 5% of total loans, down from $304 million and 14%, respectively, at March 31, 2008. Nonaccrual residential construction loan balances declined by $19 million over the past 12 months to $73 million or 3.7% of total loans as the decline in the two-step nonaccrual loan balances more than offset the increase in the remaining residential construction loan categories. Loans to borrowers involved in residential site development exhibited the most deterioration in credit quality. The non two-step residential construction nonaccrual loan properties are largely located in Clark, Pierce and King counties in the state of Washington, and in Marion and Deschutes counties in the state of Oregon.

	West Coast Bancorp
	Residential construction and land loans including two-step loans

(Dollars in thousands, unaudited)	March 31, 2009					March 31, 2008					December 31, 2008
	Amount		Percent of total loans2			Amount		Percent of total loans2			Amount		Percent of total loans2
Accruing residential construction loans and land loans
Land loans1	$	17,739		0.9	%	$	27,210		1.2	%	$	17,887		0.9	%
Site development		28,946		1.4	%		75,702		3.4	%		37,437		1.8	%
Vertical construction		57,244		2.9	%		78,524		3.6	%		61,593		3.0	%
Two-step loans		-		0.0	%		122,622		5.6	%		3,124		0.2	%
Total accruing residential construction and land loans	$	103,929		5.2	%	$	304,058		13.9	%	$	120,041		5.8	%

Nonaccrual residential construction loans and land loans
Land loans1	$	2,092		0.1	%	$	710		0.0	%	$	5,608		0.3	%
Site development		34,316		1.7	%		620		0.0	%		27,291		1.3	%
Vertical construction		12,901		0.6	%		2,226		0.1	%		9,703		0.5	%
Two-step loans		23,725		1.2	%		88,784		4.0	%		49,960		2.4	%
Total nonaccrual residential construction and land loans	$	73,034		3.7	%	$	92,340		4.2	%	$	92,562		4.5	%

Total residential construction and land loans
Land loans1	$	19,831		1.0	%	$	27,920		1.3	%	$	23,495		1.1	%
Site development		63,262		3.2	%		76,322		3.5	%		64,728		3.1	%
Vertical construction		70,145		3.5	%		80,750		3.7	%		71,296		3.5	%
Two-step loans		23,725		1.2	%		211,406		9.6	%		53,084		2.6	%
Total residential construction and land loans	$	176,963		8.9	%	$	396,398		18.1	%	$	212,603		10.3	%

Total net charge-offs in the first quarter of 2009 were $14.6 million. The net charge-offs related to the two-step portfolio were $3.5 million, down from $20.0 million in the same period last year. The net charge-offs for loans other than two-step loans were $11.1 million compared to $1.1 million in the first quarter of 2008 and $15.2 million in the final quarter of 2008. The higher year over year first quarter level of net charge-off activity for loans other than two-step loans was primarily associated with residential construction, commercial, and residential mortgage and home equity loans. The Bank has experienced very few charge-offs of commercial real estate loans over the past 15 months. A significant deterioration in credit quality in the Bank’s commercial real estate portfolio, however, would put additional pressure on our results of operations and financial position.

As a result of the provision for credit losses exceeding net charge-offs by $9.0 million during the first quarter of 2009, the allowance for credit losses associated with loans other than two-step loans increased from $29.5 million or 1.47% of such outstanding loan balances at year end 2008 to $38.5 million or 1.95% at March 31, 2009. The first quarter 2009 provision expense was in part driven by a decision to increase the unallocated reserve given uncertainty associated with current economic conditions. The unallocated portion of the allowance for loan losses increased to $5.8 million or 15% of the total allowance at March 31, 2009, up from $1.4 million and 3% a year ago. The Company’s estimate of appropriate reserve amounts will continue to be primarily dependent on the loan portfolio’s credit quality performance trends, including net charge-offs, which will be heavily dependent on local economic conditions and the health of the real estate market.

Total non-performing assets were $215.5 million or 8.6% of total assets at March 31, 2009, up from $105 million and 4.0%, respectively, at March 31, 2008 and $198 million and 7.9% at year-end 2008. Non-performing assets related to the two-step loan portfolio were $97 million or 3.9% of total assets, up from $94 million a year ago but down from $110 million at December 31, 2008. There were no accruing two-step loans remaining at March 31, 2009 and all such nonaccruing loans have been impaired. The $97 million balance of nonperforming two-step assets at quarter end reflected prior write-downs of approximately 28% of the original loan balance, consistent with our realized loss rate to date for this portfolio. During the first quarter of 2009 the nonaccrual two-step loan balance declined from $50 million to $24 million, while the two-step OREO balance increased from $60 million to $73 million as we took ownership of more properties. The decline in two-step nonperforming assets is projected to accelerate over the remainder of 2009 based on seasonality factors and recent increases in number of pending sales.

Nonperforming assets, excluding the two-step portfolio, increased by $31 million to $118 million or 4.74% of total assets at March 31, 2009, from $88 million and 3.49%, respectively, at year end 2008. The $31 million increase was largely linked to three commercial relationships amounting to $22 million and residential construction loans totaling $6.5 million. The significant jump in commercial nonperforming assets reflects businesses impacted directly by the deterioration in the housing industry coupled with difficult business conditions associated with an economy in recession. The incidence of commercial nonperforming assets was not widespread. The inflow into nonaccrual loan balances from the residential construction portfolio slowed from the prior quarter, in part due to the reduction in the accruing portfolio balance. Also, nonstandard mortgage loan balances on nonaccrual status declined by $4.3 million since year end 2008 to $10.9 million.

The Company will hold a Webcast conference call Monday, April 27, 2009, at 11:00 a.m. Pacific Time, during which the Company will discuss first quarter 2009 results and key activities. To access the conference call via a live Webcast, go to www.wcb.com and click on Investor Relations and the “1st Quarter 2009 Earnings Conference Call” tab. The conference call may also be accessed by dialing (866) 395-2683 Conference ID#: 88847420 a few minutes prior to 11:00 a.m. PDT. The call will be available for replay by accessing the Company’s website at www.wcb.com and following the same instructions.

Forward Looking Statements:

Statements in this release regarding future events, performance or results are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 ("PSLRA") and are made pursuant to the safe harbors of the PSLRA. Actual results could be quite different from those expressed or implied by the forward-looking statements. Do not unduly rely on forward-looking statements. They give our expectations about the future and are not guarantees. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them to reflect changes that occur after that date.

	West Coast Bancorp
	Consolidated Statements of Income (Loss)

(Unaudited)	Three months ended								Twelve months ended
(Dollars and shares in thousands, except per share data)	March 31,					Dec. 31,			December 31,
	2009			2008		2008			2008			2007
Net interest income
Interest and fees on loans	$	26,117		$	35,073	$	29,605		$	129,517		$	169,180
Interest on investment securities		2,478			3,098		2,388			10,951			13,446
Other interest income		13			141		24			378			564
Total interest income		28,608			38,312		32,017			140,846			183,190
Interest expense on deposit accounts		6,485			11,613		8,562			37,549			55,036
Interest on borrowings and subordinated debentures		1,993			3,122		2,318			11,147			13,434
Total interest expense		8,478			14,735		10,880			48,696			68,470
Net interest income		20,130			23,577		21,137			92,150			114,720

Provision for credit losses		23,131			8,725		16,517			40,367			38,956

Noninterest income
Service charges on deposit accounts		3,805			3,635		3,853			15,547			12,932
Payment systems related revenue		2,137			2,131		2,225			9,033			8,009
Trust and investment services revenues		919			1,585		1,053			5,413			6,390
Gains on sales of loans		343			860		244			2,328			3,364
OREO valuation adjustments and gain (loss) on sale		(4,804	)		11		(3,701	)		(5,386	)		27
Other		1,942			1,399		633			3,252			2,843
Other-than-temporary impairment losses		(192	)		-		-			(6,338	)		-
Gain (loss) on sales of securities		198			590		3			780			(67	)
Total noninterest income		4,348			10,211		4,310			24,629			33,498
Noninterest expense
Salaries and employee benefits		11,195			12,355		11,483			47,500			49,787
Equipment		1,892			1,751		1,808			7,117			6,544
Occupancy		2,366			2,375		2,414			9,440			8,548
Payment systems related expense		919			843		935			3,622			3,143
Professional fees		927			800		1,235			4,317			2,072
Postage, printing and office supplies		795			966		877			3,834			3,896
Marketing		630			795		773			3,583			4,524
Communications		393			402		456			1,722			1,624
Goodwill impairment		13,059			-		-			-			-
Other noninterest expense		3,198			1,934		2,554			9,188			5,161
Total noninterest expense		35,374			22,221		22,535			90,323			85,299
Income (loss) before income taxes		(34,027	)		2,842		(13,605	)		(13,911	)		23,963
Provision (benefit) for income taxes		(10,428	)		842		(4,924	)		(7,598	)		7,121
Net income (loss)	$	(23,599	)	$	2,000	$	(8,681	)	$	(6,313	)	$	16,842

Earnings (loss) per share:
Basic	$	(1.52	)	$	0.13	$	(0.56	)	$	(0.41	)	$	1.09
Diluted	$	(1.52	)	$	0.13	$	(0.56	)	$	(0.41	)	$	1.05

Weighted average common shares		15,485			15,445		15,489			15,472			15,507
Weighted average diluted shares		15,485			15,589		15,489			15,472			16,045

Tax equivalent net interest income	$	20,545		$	24,027	$	21,558		$	93,901		$	116,361

	West Coast Bancorp
	Consolidated Balance Sheets

	March 31,			March 31,			December 31,
(Dollars and shares in thousands, unaudited)	2009			2008			2008
Assets:
Cash and cash equivalents	$	72,626		$	88,205		$	64,778
Investments		233,668			229,431			198,515
Total loans		1,998,451			2,194,311			2,064,796
Allowance for loan losses		(37,532	)		(39,602	)		(28,920	)
Loans, net		1,960,919			2,154,709			2,035,876
OREO, net		87,189			5,688			70,110
Goodwill and other intangibles		895			14,372			14,054
Other assets		140,930			128,489			132,807
Total assets	$	2,496,227		$	2,620,894		$	2,516,140

Liabilities and Stockholders' Equity:
Demand	$	489,274		$	472,116		$	478,292
Savings and interest-bearing demand		351,153			366,267			346,206
Money market		595,954			652,559			615,588
Time deposits		615,716			570,905			584,293
Total deposits		2,052,097			2,061,847			2,024,379
Borrowings and subordinated debentures		252,059			306,052			274,059
Reserve for unfunded commitments		931			2,852			1,014
Other liabilities		16,581			42,206			18,501
Total liabilities		2,321,668			2,412,957			2,317,953
Stockholders' equity		174,559			207,937			198,187
Total liabilities and stockholders' equity	$	2,496,227		$	2,620,894		$	2,516,140

Common shares outstanding period end		15,687			15,580			15,696
Book value per common share	$	11.13		$	13.35		$	12.63
Tangible book value per common share	$	11.07		$	12.42		$	11.73

	West Coast Bancorp
	Summary Financial Information

	First			First			Fourth
(Dollars in thousands except for per share data, unaudited)	Quarter			Quarter			Quarter			Year to date			Year to date
(all rates have been annualized where appropriate)	2009			2008			2008			2008			2007
PERFORMANCE RATIOS
- Return on average assets		-(3.85	)%		0.31	%		(1.38	)%		(0.25	)%		0.66	%
- Return on average common equity		-(48.54	)%		3.81	%		(17.21	)%		(3.06	)%		7.93	%
- Return on average tangible equity		-(52.07	)%		4.25	%		(18.37	)%		(3.14	)%		8.69	%
- Non-interest income to average assets		0.71	%		1.58	%		0.68	%		0.96	%		1.32	%
- Non-interest expense to average assets		5.77	%		3.44	%		3.57	%		3.52	%		3.36	%
- Efficiency ratio, tax equivalent		143.2	%		66.0	%		87.1	%		72.8	%		56.9	%

NET INTEREST MARGIN
- Yield on average interest-earning assets		5.19	%		6.33	%		5.57	%		5.92	%		7.72	%
- Rate on average interest-bearing liabilities		1.91	%		3.14	%		2.36	%		2.60	%		3.76	%
- Net interest spread		3.28	%		3.19	%		3.21	%		3.32	%		3.96	%
- Net interest margin		3.67	%		3.92	%		3.70	%		3.90	%		4.86	%

AVERAGE ASSETS
- Investment securities	$	200,875		$	254,773		$	212,900		$	229,478		$	284,582

- Commercial loans		471,650			508,566			491,663			507,641			497,975
- Real estate construction loans		267,296			501,459			311,117			403,823			477,055
- Real estate mortgage loans		392,445			342,315			392,570			371,365			296,859
- Commercial real estate loans		882,614			800,350			875,211			840,496			798,383
- Installment and other consumer loans		21,032			24,245			22,364			23,545			24,705
- Total loans		2,035,037			2,176,935			2,092,925			2,146,870			2,094,977

- Total interest earning assets		2,267,580			2,464,280			2,318,140			2,409,896			2,394,958
- Other assets		217,178			132,456			190,705			159,723			142,760
- Total assets	$	2,484,758		$	2,596,736		$	2,508,845		$	2,569,619		$	2,537,718

AVERAGE LIABILITIES & EQUITY
- Demand deposits	$	469,667		$	464,088		$	467,768		$	470,601		$	479,311
- Savings and Interest bearing demand		348,011			358,986			338,584			350,769			351,521
- Money market		594,108			662,508			636,013			658,360			665,037
- Time deposits		570,049			579,157			584,137			566,195			554,263
- Total deposits		1,981,835			2,064,739			2,026,502			2,045,925			2,050,132

- Borrowings and subordinated debentures		289,406			285,138			276,336			300,759			250,478

- Total interest bearing liabilities		1,801,575			1,885,789			1,835,069			1,876,083			1,821,299
- Other liabilities		486,028			499,741			473,061			487,010			504,070
- Total liabilities		2,287,603			2,385,530			2,308,130			2,363,093			2,325,369
- Common equity		197,155			211,206			200,715			206,526			212,349
- Total average liabilities and common equity	$	2,484,758		$	2,596,736		$	2,508,845		$	2,569,619		$	2,537,718

AVERAGE ASSET/LIABILITY RATIOS
- Stockholders' equity to total assets		7.93	%		8.13	%		8.00	%		8.04	%		8.37	%
- Interest earning assets to interest bearing liabilities		125.9	%		130.7	%		126.3	%		128.5	%		131.5	%
- Total loans to total assets		81.9	%		83.8	%		83.4	%		83.6	%		82.6	%
- Interest bearing deposits to total assets		60.9	%		59.0	%		62.1	%		61.3	%		59.0	%

Table 2	West Coast Bancorp
	Period End Loan Portfolio By Category
	March 31,		% of			March 31,		% of			Change						Dec. 31,		% of
(Dollars in thousands, unaudited)	2009		loans			2008		loans			Amount			%			2008		loans
Commercial loans	$	462,466		23	%	$	529,519		24	%	$	(67,053	)		-13	%	$	482,405		23	%
Comercial real estate construction		87,561		4	%		94,878		4	%		(7,317	)		-8	%		92,414		4	%
Residential real estate construction		157,050		8	%		369,150		17	%		(212,100	)		-57	%		192,735		9	%
Total real estate construction loans		244,611		12	%		464,028		21	%		(219,417	)		-47	%		285,149		14	%
Standard mortgages		83,889		4	%		87,621		4	%		(3,732	)		-4	%		87,628		4	%
Nonstandard mortgages		26,111		1	%		25,107		1	%		1,004			4	%		32,597		2	%
Home equity		281,186		14	%		243,457		11	%		37,729			15	%		272,983		13	%
Total real estate mortgage		391,186		20	%		356,185		16	%		35,001			10	%		393,208		19	%
Commercial real estate loans		879,394		44	%		819,586		37	%		59,808			7	%		882,092		43	%
Installment and other consumer loans		20,794		1	%		24,993		1	%		(4,199	)		-17	%		21,942		1.1	%
Total loans	$	1,998,451				$	2,194,311				$	(195,860	)		-9	%	$	2,064,796

Two-step residential construction loans	$	23,725		1	%	$	211,406		10	%	$	(187,681	)		-89	%	$	53,084		3	%
Total loans other than two-step loans		1,974,726		99	%		1,982,905		90	%		(8,179	)		0	%		2,011,712		97	%
Total loans	$	1,998,451		100	%	$	2,194,311		100	%	$	(195,860	)		-9	%	$	2,064,796		100	%

Table 3	West Coast Bancorp
	Total Loan Portfolio
	Allowance For Credit Losses and Net Charge-offs
	Quarter ended			Quarter ended			Quarter ended
	March 31,			March 31,			December 31,
(Dollars in thousands, unaudited)	2009			2008			2008
Allowance for credit losses, beginning of period	$	29,934		$	54,903		$	34,444
Provision for credit losses		23,131			8,725			16,517

Loan charge-offs:
Commercial		1,275			623			3,208
Commercial real estate construction		-			-			1,422
Residential real estate construction		8,776			20,394			11,475
Total real estate construction		8,776			20,394			12,897
Standard mortgages		1,018			-			1,640
Nonstandard mortgages		1,929			-			2,495
Home equity		1,281			-			121
Total real estate mortgage		4,228			-			4,256
Commercial real estate		406			-			782
Installment and consumer		132			74			29
Overdraft		249			302			401
Total loan charge-offs		15,066			21,393			21,573
Loan recoveries:
Commercial		217			32			122
Commercial real estate construction		-			-			-
Residential real estate construction		151			66			319
Total real estate construction		151			66			319
Standard mortgages		3			-			-
Nonstandard mortgages		-			-			38
Home equity		-			27			2
Total real estate mortgage		3			27			40
Commercial real estate		-			-			-
Installment and consumer		22			26			15
Overdraft		71			68			50
Total loan recoveries		464			219			546
Net charge-offs		14,602			21,174			21,027

Total allowance for credit losses	$	38,463		$	42,454		$	29,934
Components of allowance for credit losses:
Allowance for loan losses	$	37,532		$	39,602		$	28,920
Reserve for unfunded commitments		931			2,852			1,014
Total allowance for credit losses	$	38,463		$	42,454		$	29,934

Net loan charge-offs to average loans (annualized)		2.92	%		3.91	%		4.00	%
Allowance for loan losses to total loans		1.88	%		1.80	%		1.40	%
Allowance for credit losses to total loans		1.92	%		1.93	%		1.45	%
Allowance for loan losses to nonperforming loans		29	%		40	%		23	%
Allowance for credit losses to nonperforming loans		30	%		43	%		23	%

Table 4	West Coast Bancorp
	Total Loan Portfolio
	Allowance For Credit Losses and Net Charge-offs
	Year ended			Year ended
	December 31,			December 31,
(Dollars in thousands, unaudited)	2008			2007
Allowance for credit losses, beginning of period	$	54,903		$	23,017
Provision for credit losses		40,367			38,956

Loan charge-offs:
Commercial		6,464			3,798
Commercial real estate construction		1,422			-
Residential real estate construction		52,588			2,540
Total real estate construction		54,010			2,540
Standard mortgages		1,811			-
Nonstandard mortgages		3,036			-
Home equity		249			71
Total real estate mortgage		5,096			71
Commercial real estate		826			-
Installment and consumer		531			254
Overdraft		1,328			1,050
Total loan charge-offs		68,255			7,713
Loan recoveries:
Commercial		203			269
Commercial real estate construction		-			-
Residential real estate construction		2,339			7
Total real estate construction		2,339			7
Standard mortgages		-			-
Nonstandard mortgages		38			-
Home equity		32			33
Total real estate mortgage		70			33
Commercial real estate		-			2
Installment and consumer		78			112
Overdraft		229			220
Total loan recoveries		2,919			643
Net charge-offs		65,336			7,070

Total allowance for credit losses	$	29,934		$	54,903
Components of allowance for credit losses:
Allowance for loan losses	$	28,920		$	46,917
Reserve for unfunded commitments		1,014			7,986
Total allowance for credit losses	$	29,934		$	54,903

Net loan charge-offs to average loans		3.04	%		0.34	%
Allowance for loan losses to total loans		1.40	%		2.16	%
Allowance for credit losses to total loans		1.45	%		2.53	%
Allowance for loan losses to nonperforming loans		23	%		178	%
Allowance for credit losses to nonperforming loans		23	%		208	%

Table 5	West Coast Bancorp
	Total Loan Portfolio
	Nonperforming Assets and Delinquencies

	March 31,			March 31,			December 31,
(Dollars in thousands, unaudited)	2009			2008			2008
Loans on nonaccrual status:
Commercial	$	29,014		$	4,336		$	6,250
Real estate construction:
Commercial real estate construction		2,923			-			2,922
Residential real estate construction		70,942			91,630			90,712
Total real estate construction		73,865			91,630			93,634
Real estate mortgage:
Standard mortgage		9,467			936			8,283
Nonstandard mortgage		10,972			295			15,229
Home equity		961			274			1,043
Total real estate mortgage		21,400			1,505			24,555
Commercial real estate		3,980			1,565			3,145
Installment and consumer		22			2			6
Total nonaccrual loans		128,281			99,038			127,590
90 days past due not on nonaccrual		-			-			-
Total non-performing loans		128,281			99,038			127,590

Other real estate owned		87,189			5,688			70,110
Total non-performing assets	$	215,470		$	104,726		$	197,700

Non-performing loans to total loans		6.42	%		4.51	%		6.18	%
Non-performing assets to total assets		8.63	%		4.00	%		7.86	%

	Total Loan Portfolio
	Delinquent loans 30-89 days past due as a % of loan category

	March 31,			March 31,			December 31,
(Dollars in thousands, unaudited)	2009			2008			2008
Commercial loans		0.20	%		0.47	%		0.58	%
Real estate construction loans		1.51	%		4.06	%		0.68	%
Real estate mortgage loans		0.78	%		1.42	%		0.49	%
Commercial real estate loans		0.19	%		0.07	%		0.15	%
Installment and other consumer loans		0.96	%		0.39	%		0.36	%

Delinquent loans 30-89 days past due:
Two-step residential construction loans	$	-		$	14,269		$	1,242
Total loans other than two-step loans		9,605			12,826			6,850
Total delinquent loans 30-89 days past due, not in nonaccrual status	$	9,605		$	27,095		$	8,092

Delinquent loans to total loans		0.48	%		1.23	%		0.39	%

Table 7
(Dollars in thousands)	Two-step related OREO activity						Two-step short sales						Total two-step OREO property sales and short sales
Quarterly 2008:	Amount			Number			Amount			Number			Amount			Number
Beginning balance January 1	$	3,255			14
Additions to OREO		2,461			10
Capitalized improvements		246
Valuation adjustments		-
Disposition of OREO properties and short sales		(274	)		(1	)	$	(286	)		(1	)	$	(560	)		(2	)
Ending balance March 31	$	5,688			23

Additions to OREO		23,546			87
Capitalized improvements		188
Valuation adjustments		(245	)
Disposition of OREO properties and short sales		(2,717	)		(9	)	$	(4,368	)		(14	)	$	(7,085	)		(23	)
Ending balance June 30	$	26,460			101

Additions to OREO		24,025			91
Capitalized improvements		175
Valuation adjustments		(1,118	)
Disposition of OREO properties and short sales		(4,867	)		(19	)	$	(3,200	)		(12	)	$	(8,067	)		(31	)
Ending balance September 30	$	44,675			173

Additions to OREO		25,831			106
Capitalized improvements		710
Valuation adjustments		(2,923	)
Disposition of OREO properties and short sales		(8,271	)		(28	)	$	(3,594	)		(13	)	$	(11,865	)		(41	)
Ending balance December 31	$	60,022			251

Full year 2008:
Beginning balance January 1	$	3,255			14
Additions to OREO		75,863			294
Capitalized improvements		1,319
Valuation adjustments		(4,286	)
Disposition of OREO properties and short sales		(16,129	)		(57	)	$	(11,448	)		(40	)	$	(27,577	)		(97	)
Ending balance December 31	$	60,022			251

Quarterly 2009:
Additions to OREO		20,635			62
Capitalized improvements		668
Valuation adjustments		(4,110	)
Disposition of OREO properties and short sales		(3,896	)		(17	)	$	(2,502	)		(7	)	$	(6,398	)		(24	)
Ending balance March 31, 2009	$	73,319			296

January 1, 2008 through March 31, 2009 Beginning balance 1/1/2008		3,255			14
Additions to OREO		96,498			356
Capitalized improvements		1,987
Valuation adjustments		(8,396	)
Disposition of OREO properties and short sales		(20,025	)		(74	)	$	(13,950	)		(47	)	$	(33,975	)		(121	)
Ending balance March 31, 2009	$	73,319			296

Table 8	West Coast Bancorp
	Two-Step Loan Portfolio
	Allowance For Credit Losses and Net Charge-offs Two- Step Portfolio
	Quarter ended		Quarter ended		Quarter ended
	March 31,		March 31,		December 31,
(Dollars in thousands, unaudited)	2009		2008		2008
Allowance for credit losses, beginning of period	$	421	$	31,065	$	1,502
Provision for credit losses		3,103		780		4,776
Charge-offs		3,675		20,099		6,176
Recoveries		151		66		319
Net charge-offs		3,524		20,033		5,857

Total allowance for credit losses	$	-	$	11,812	$	421

Components of allowance for credit losses
Allowance for loan losses	$	-	$	9,991	$	420
Reserve for unfunded commitments		-		1,821		1
Total allowance for credit losses	$	-	$	11,812	$	421

Table 9	West Coast Bancorp
	Two-Step Residential Construction Loans
	Nonperforming Assets and Delinquencies

	March 31,			March 31,			December 31,
(Dollars in thousands, unaudited)	2009			2008			2008
Nonaccrual two-step loans	$	23,725		$	88,784		$	49,960
90 day past due and accruing interest		-			-			-
Total nonperforming two-step loans		23,725			88,784			49,960

Other real estate owned two-step		73,319			5,688			60,022
Total nonperforming two-step assets	$	97,044		$	94,472		$	109,982

Delinquent two-step loans 30-89 days past due, not in nonaccrual status	$	-		$	14,269		$	1,242

Nonperforming two-step assets to total assets		3.89	%		3.60	%		4.37	%
Delinquent two-step loans to total two-step loans		0.00	%		6.75	%		2.34	%

Table 10	West Coast Bancorp
	Other than two-step loan portfolio
	Allowance For Credit Losses and Net Charge-offs other than two-step loans
	Quarter ended			Quarter ended			Quarter ended
	March 31,			March 31,			December 31,
(Dollars in thousands, unaudited)	2009			2008			2008
Allowance for credit losses, beginning of period	$	29,513		$	23,838		$	32,942
Provision for credit losses		20,028			7,945			11,741

Loan charge-offs:
Commercial		1,275			623			3,208
Commercial real estate construction		-			-			1,422
Residential real estate construction		5,101			295			5,299
Total real estate construction		5,101			295			6,721
Standard mortgages		1,018			-			1,640
Nonstandard mortgages		1,929			-			2,495
Home equity		1,281			-			121
Total real estate mortgage		4,228			-			4,256
Commercial real estate		406			-			782
Installment and consumer		132			74			29
Overdraft		249			302			401
Total loan charge-offs		11,391			1,294			15,397
Loan recoveries:
Commercial		217			32			122
Commercial real estate construction		-			-			-
Residential real estate construction		-			-			-
Total real estate construction		-			-			-
Standard mortgages		3			-			-
Nonstandard mortgages		-			-			38
Home equity		-			27			2
Total real estate mortgage		3			27			40
Commercial real estate		-			-			-
Installment and consumer		22			26			15
Overdraft		71			68			50
Total loan recoveries		313			153			227
Net charge-offs		11,078			1,141			15,170

Total allowance for credit losses	$	38,463		$	30,642		$	29,513
Components of allowance for credit losses:
Allowance for loan losses	$	37,532		$	29,611		$	28,500
Reserve for unfunded commitments		931			1,031			1,013
Total allowance for credit losses	$	38,463		$	30,642		$	29,513

Net loan charge-offs to average loans (annualized)		2.21	%		0.21	%		2.88	%
Allowance for loan losses to total loans		1.90	%		1.49	%		1.42	%
Allowance for credit losses to total loans		1.95	%		1.55	%		1.47	%
Allowance for loan losses to nonperforming loans		36	%		289	%		37	%
Allowance for credit losses to nonperforming loans		37	%		289	%		38	%

Table 11	West Coast Bancorp
	Other than two-step loan portfolio
	Allowance For Credit Losses and Net Charge-offs other than two-step loans
	Year ended			Year ended
	December 31,			December 31,
(Dollars in thousands, unaudited)	2008			2007
Allowance for credit losses, beginning of period	$	23,838		$	20,399
Provision for credit losses		30,867			7,976

Loan charge-offs:
Commercial		6,464			3,798
Commercial real estate construction		1,422			-
Residential real estate construction		10,105			-
Total real estate construction		11,527			-
Standard mortgages		1,811			-
Nonstandard mortgages		3,036			-
Home equity		249			71
Total real estate mortgage		5,096			71
Commercial real estate		826			-
Installment and consumer		531			254
Overdraft		1,328			1,050
Total loan charge-offs		25,772			5,173
Loan recoveries:
Commercial		203			269
Commercial real estate construction		-			-
Residential real estate construction		-			-
Total real estate construction		-			-
Standard mortgages		-			-
Nonstandard mortgages		38			-
Home equity		32			33
Total real estate mortgage		70			33
Commercial real estate		-			2
Installment and consumer		78			112
Overdraft		229			220
Total loan recoveries		580			636
Net charge-offs		25,192			4,537

Total allowance for credit losses	$	29,513		$	23,838
Components of allowance for credit losses:
Allowance for loan losses	$	28,500		$	23,000
Reserve for unfunded commitments		1,013			838
Total allowance for credit losses	$	29,513		$	23,838

Net loan charge-offs to average loans		1.17	%		0.22	%
Allowance for loan losses to total loans		1.42	%		1.20	%
Allowance for credit losses to total loans		1.47	%		1.25	%
Allowance for loan losses to nonperforming loans		37	%		391	%
Allowance for credit losses to nonperforming loans		38	%		405	%

Table 12	West Coast Bancorp
	Loans Other than Two-Step Loans
	Nonperforming Assets and Delinquencies

	March 31,			March 31,			December 31,
(Dollars in thousands, unaudited)	2009			2008			2008
Loans on nonaccrual status:
Commercial	$	29,014		$	4,336		$	6,250
Real estate construction:
Commercial real estate construction		2,923			2,846			2,922
Residential real estate construction		47,217			-			40,752
Total real estate construction		50,140			2,846			43,674
Real estate mortgage:
Standard mortgage		9,467			936			8,283
Nonstandard mortgage		10,972			295			15,229
Home equity		961			274			1,043
Total real estate mortgage		21,400			1,505			24,555
Commercial real estate		3,980			1,565			3,145
Installment and consumer		22			2			6
Total nonaccrual loans		104,556			10,254			77,630
90 days past due not on nonaccrual		-			-			-
Total non-performing loans		104,556			10,254			77,630

Other real estate owned		13,870			-			10,088
Total non-performing assets	$	118,426		$	10,254		$	87,718

Delinquent non two-step loans 30-89 days past due, not in nonaccrual status	$	9,605		$	12,826		$	6,850

Nonperforming non two-step loans to total non two-step loans		5.29	%		0.52	%		3.86	%
Nonperforming non two-step assets to total assets		4.74	%		0.39	%		3.49	%
Delinquent non two-step loans to total non two-step loans		0.49	%		0.65	%		0.34	%

Table 13	West Coast Bancorp
	Construction and land loans outside the two-step portfolio

(Dollars in thousands, unaudited)	March 31, 2009					March 31, 2008					December 31, 2008
	Amount		Percent2			Amount		Percent2			Amount		Percent2
Land loans1	$	41,483		16	%	$	49,849		17	%	$	46,286		17	%
Residential construction loans other than two-step loans		131,125		50	%		157,072		52	%		136,024		49	%
Commercial construction loans		87,709		34	%		94,878		31	%		92,616		34	%
Total construction and land loans other than two-step loans	$	260,317		100	%	$	301,799		100	%	$	274,926		100	%

Components of residential construction and land loans other than two-step loans:
Land loans1	$	19,831		13	%	$	27,920		15	%	$	23,495		15	%
Site development		63,262		41	%		76,322		41	%		64,728		40	%
Vertical construction		70,145		46	%		80,750		44	%		71,296		45	%
Total residential construction and land loans other than two-step loans	$	153,238		100	%		184,992		100	%	$	159,519		100	%

Components of commercial construction and land loans:
Land loans1	$	21,652		20	%	$	21,929		19	%	$	22,791		20	%
Site development		607		1	%		1,107		1	%		607		1	%
Vertical construction		87,102		80	%		93,771		80	%		92,009		79	%
Total commercial construction and land loans	$	109,361		100	%	$	116,807		100	%	$	115,407		100	%

Components of total construction and land loans other than two-step loans:
Land loans1	$	41,483		16	%	$	49,849		17	%	$	46,286		17	%
Site development		63,869		24	%		77,429		26	%		65,335		24	%
Vertical construction		157,247		60	%		174,521		57	%		163,305		59	%
Total construction and land loans other than two-step loans	$	262,599		100	%	$	301,799		100	%	$	274,926		100	%

Table 14	West Coast Bancorp
	Nonaccrual construction and land loans oustide the two-step portfolio
(Dollars in thousands, unaudited)	March 31, 2009					March 31, 2008					December 31, 2008
	Amount		Percent of loan category2			Amount		Percent of loan category2			Amount		Percent of loan category2
Land loans1	$	2,092		5.04	%	$	710		1.42	%	$	5,794		12.50	%
Residential construction loans other than two-step loans		47,217		35.39	%		2,846		1.81	%		36,994		27.20	%
Commercial construction loans		2,922		3.33	%		-		0.00	%		2,922		3.20	%

Total nonaccrual construction and land loans other than two-step loans	$	52,231		19.89	%	$	3,556		1.17	%	$	45,710		16.63	%

Components of nonaccrual residential construction and land loans other than two-step loans:
Land loans1	$	2,092		10.55	%	$	710		2.54	%	$	5,608		23.90	%
Site development		34,316		54.24	%		620		0.81	%		27,291		42.20	%
Vertical construction		12,901		18.39	%		2,226		2.76	%		9,703		13.60	%
Total nonaccrual residential construction and land loans other than two-step loans	$	49,309		32.18	%	$	3,556		1.92	%	$	42,602		26.71	%

Components of nonaccrual commercial construction and land loans:
Land loans1		-		0.00	%		-		0.00	%		186		0.08	%
Site development		-		0.00	%		-		0.00	%		-		0.00	%
Vertical construction		2,922		3.35	%		-		0.00	%		2,922		3.20	%
Total nonaccrual commercial construction and land loans	$	2,922		2.67	%	$	-		0.00	%	$	3,108		2.69	%

Components of total nonaccrual construction and land loans other than two-step loans:
Land loans1	$	2,092		5.04	%	$	710		1.42	%	$	5,794		12.50	%
Site development		34,316		53.73	%		620		0.80	%		27,291		41.80	%
Vertical construction		15,823		10.06	%		2,226		1.28	%		12,625		7.70	%

Total nonaccrual construction and land loans other than two-step loans	$	52,231		19.89	%	$	3,556		1.18	%	$	45,710		16.63	%

Table 15	West Coast Bancorp
	Delinquent construction and land loans outside the two-step loan portfolio
(Dollars in thousands, unaudited)	March 31, 2009					March 31, 2008					December 31, 2008
	Amount		Percent of loan category2			Amount		Percent of loan category2			Amount		Percent of loan category2
Land loans1	$	452		1.09	%	$	336		0.67	%	$	638		1.38	%
Residential construction loans other than two-step loans		3,718		2.84	%		4,557		2.90	%		698		0.51	%
Commercial construction loans		-		0.00	%		-		0.00	%		-		0.00	%

Total 30-89 days past due construction loans other than two-step loans	$	4,170		1.60	%	$	4,893		1.62	%	$	1,336		0.49	%

Components of 30-89 days past due residential construction and land loans other than two-step loans:
Land loans1	$	452		2.28	%	$	336		1.20	%	$	165		0.70	%
Site development		1,090		1.79	%		2,119		2.78	%		131		0.20	%
Vertical construction		2,628		3.75	%		2,438		3.02	%		567		0.80	%
Total 30-89 days past due residential construction and land loans other than two-step loans	$	4,170		2.76	%	$	4,893		2.64	%	$	863		0.54	%

Components of 30-89 days past due commercial construction and land loans:
Land loans1	$	-		0.00	%	$	-		0.00	%	$	473		2.08	%
Site development		-		0.00	%		-		0.00	%		-		0.00	%
Vertical construction		-		0.00	%		-		0.00	%		-		0.00	%
Total 30-89 days past due commercial construction and land loans	$	-		0.00	%	$	-		0.00	%	$	473		0.41	%

Components of total 30-89 days past due construction and land loans other than two-step loans:
Land loans1	$	452		1.09	%	$	336		0.67	%	$	638		1.38	%
Site development		1,090		1.77	%		2,119		2.74	%		131		0.20	%
Vertical construction		2,628		1.67	%		2,438		1.40	%		567		0.35	%

Total 30-89 days past due construction and land loans other than two-step loans	$	4,170		1.60	%	$	4,893		1.62	%	$	1,336		0.49	%

(Dollars in thousands, unaudited)
Period ended	Total accruing two- step loan commitments		Accruing two-step loans		Nonaccrual two- step loans		Two-step OREO		Total two-step nonperforming assets
12/31/2007	$	320,991	$	242,407	$	20,545	$	3,255	$	23,800
3/31/2008		156,823		122,622		88,784		5,688		94,472
6/30/2008		59,603		46,975		98,728		26,460		125,188
9/30/2008		16,943		14,904		82,990		44,675		127,665
12/31/2008		3,276		3,124		49,960		60,022		109,982
3/31/2009		-		-		23,725		73,319		97,044

Table 1	West Coast Bancorp
	Reconciliation of Operating earnings (loss) to GAAP net income

	For the three months ended March 31,
(Dollars in thousands, unaudited)	2009			2008
GAAP net income (loss)	$	(23,599	)	$	2,000
Add: Goodwill impairment charge, net of tax		13,059			-
Operating net income (loss)	$	(10,540	)	$	2,000

Diluted earnings (loss) per diluted share
GAAP net income (loss)	$	(1.52	)	$	0.13
Operating net income (loss)	$	(0.68	)	$	0.13

Table 6	West Coast Bancorp
	Other real estate owned ("OREO") activity
	Three months						Three months						Three months
	ended March 31,			Number			ended March 31,			Number			ended Dec. 31,			Number
(Dollars in thousands, unaudited)	2009			of properties			2008			of properties			2008			of properties
Beginning balance	$	70,110			288		$	3,255			15		$	48,121			189
Additions to OREO1		25,931			79			2,707			10			34,066			129
Valuation adjustments to OREO		(4,761	)		-			-			-			(3,422	)
Disposition of OREO		(4,091	)		(18	)		(274	)		(1	)		(8,655	)		(30	)
Ending balance	$	87,189			349		$	5,688			24		$	70,110			288

	OREO activity related to two-step loans
	Three months						Three months						Three months
	ended March 31,			Number			ended March 31,			Number			ended Dec. 31,			Number
(Dollars in thousands, unaudited)	2009			of properties			2008			of properties			2008			of properties
Beginning balance	$	60,022			251		$	3,255			14		$	44,675			173
Additions to OREO1		21,303			62			2,707			10			26,541			106
Valuation adjustments to OREO		(4,110	)					-			-			(2,923	)
Disposition of OREO		(3,896	)		(17	)		(274	)		(1	)		(8,271	)		(28	)
Ending balance	$	73,319			296		$	5,688			23		$	60,022			251

	OREO activity related to loans other than two-step loans
	Three months						Three months				Three months
	ended March 31,			Number			ended March 31,		Number		ended Dec. 31,			Number
(Dollars in thousands, unaudited)	2009			of properties			2008		of properties		2008			of properties
Beginning balance	$	10,088			37		$	-		1	$	3,446			16
Additions to OREO1		4,628			17			-		-		7,525			23
Valuation adjustments to OREO		(651	)					-		-		(499	)
Disposition of OREO		(195	)		(1	)		-		-		(384	)		(2	)
Ending balance	$	13,870			53		$	-		1	$	10,088			37