exv99w2

Exhibit 99.2

Sterling Financial Corporation
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts, unaudited)


	Dec 31,			Sept 30,			Dec 31,
	2007			2007			2006
ASSETS:
Cash and cash equivalents	$	195,578		$	168,356		$	179,715
Investments and mortgage-backed securities (“MBS”) available for sale		1,951,612			1,788,911			1,820,583
Investments held to maturity		132,793			115,518			93,063
Loans receivable, net		8,948,307			8,747,430			7,021,241
Loans held for sale		55,840			54,460			91,469
Real estate owned, net		11,075			3,427			4,052
Office properties and equipment, net		93,467			94,939			93,796
Bank owned life insurance (“BOLI”)		150,825			149,136			139,206
Goodwill, net		453,136			453,294			247,244
Other intangible assets, net		31,627			32,852			28,570
Prepaid expenses and other assets, net		125,515			138,592			115,553

Total assets	$	12,149,775		$	11,746,915		$	9,834,492


LIABILITIES:
Deposits	$	7,677,772		$	7,766,392		$	6,746,028
Advances from Federal Home Loan Bank		1,687,989			1,462,132			1,308,617
Repurchase agreements and fed funds		1,178,845			941,143			616,354
Other borrowings		273,015			273,467			240,226
Accrued expenses and other liabilities		146,824			145,063			139,851

Total liabilities		10,964,445			10,588,197			9,051,076


SHAREHOLDERS’ EQUITY:
Common stock		51,456			51,422			42,043
Additional paid-in capital		892,028			891,518			590,218
Accumulated comprehensive loss:
Unrealized loss on investments and MBS ⁽¹⁾		(17,967	)		(32,067	)		(33,350	)
Retained earnings		259,813			247,845			184,505

Total shareholders’ equity		1,185,330			1,158,718			783,416

Total liabilities and shareholders’ equity	$	12,149,775		$	11,746,915		$	9,834,492


Book value per share	$	23.04		$	22.53		$	18.63
Tangible book value per share ⁽²⁾	$	13.61		$	13.08		$	12.07
Shares outstanding at end of period		51,456,461			51,422,336			42,042,740
Shareholders’ equity to total assets		9.76	%		9.86	%		7.97	%
Tangible shareholders’ equity to tangible assets ⁽³⁾		6.01	%		5.97	%		5.31	%


(1)		Net of deferred income taxes.

(2)		Amount represents shareholders’ equity less net goodwill and other intangible assets divided by total shares outstanding.

(3)		Amount represents shareholders’ equity less net goodwill and other intangible assets divided by assets less net goodwill and other intangible assets.

Sterling Financial Corporation
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts, unaudited)


	Three Months Ended									Twelve Months Ended
	Dec 31,			Sept 30,			Dec 31,			Dec 31,			Dec 31,
	2007			2007			2006			2007			2006
INTEREST INCOME:
Loans	$	175,271		$	179,132		$	137,537		$	679,991		$	458,558
Mortgage-backed securities		20,560			18,882			20,954			79,266			88,398
Investments and cash		2,266			1,904			1,257			7,721			3,899

Total interest income		198,097			199,918			159,748			766,978			550,855


INTEREST EXPENSE:
Deposits		71,739			71,489			57,901			277,614			185,273
Borrowings		34,318			34,765			27,973			134,004			101,670

Total interest expense		106,057			106,254			85,874			411,618			286,943


Net interest income		92,040			93,664			73,874			355,360			263,912
Provision for credit losses		(13,000	)		(3,888	)		(4,705	)		(25,088	)		(18,703	)

Net interest income after provision		79,040			89,776			69,169			330,272			245,209


NONINTEREST INCOME:
Fees and service charges		15,126			14,966			11,775			55,978			42,995
Mortgage banking operations		6,670			7,314			9,648			32,649			20,216
Loan servicing fees		(17	)		366			588			1,442			1,812
Real estate owned operations		(13	)		223			(71	)		72			176
BOLI		1,683			1,553			1,409			6,500			5,020
Other		(2,404	)		(215	)		(507	)		(3,163	)		(879	)

Total noninterest income		21,045			24,207			22,842			93,478			69,340


NONINTEREST EXPENSES:
Employee compensation and benefits		40,135			41,114			34,908			158,483			117,186
Occupancy and equipment		12,782			11,516			9,723			46,446			32,769
Amortization of core deposit intangibles		1,226			1,225			708			4,718			2,405
Other		21,730			20,249			14,503			75,890			54,013

Total noninterest expenses		75,873			74,104			59,842			285,537			206,373


Income before income taxes		24,212			39,879			32,169			138,213			108,176
Income tax provision		(7,355	)		(13,349	)		(9,909	)		(44,924	)		(34,230	)

Net Income	$	16,857		$	26,530		$	22,260		$	93,289		$	73,946


Earnings per share — basic	$	0.33		$	0.52		$	0.57		$	1.87		$	2.03
Earnings per share — diluted	$	0.33		$	0.51		$	0.57		$	1.86		$	2.01

Core earnings ⁽¹⁾	$	18,447		$	26,695		$	22,426		$	96,523		$	74,360
Core earnings per share — basic ⁽¹⁾	$	0.36		$	0.52		$	0.58		$	1.94		$	2.04
Core earnings per share — diluted ⁽¹⁾	$	0.36		$	0.52		$	0.57		$	1.92		$	2.02

Weighted average shares outstanding — basic		51,354,316			51,279,114			38,729,376			49,786,349			36,423,095
Weighted average shares outstanding — diluted		51,643,958			51,660,186			39,159,001			50,217,515			36,841,866


(1)		See Exhibit A.

Sterling Financial Corporation
OTHER SELECTED FINANCIAL DATA
(in thousands, unaudited)


	Three Months Ended									Twelve Months Ended
	Dec 31,			Sept 30,			Dec 31,			Dec 31,			Dec 31,
	2007			2007			2006			2007			2006
LOAN ORIGINATIONS:
Residential real estate	$	323,271		$	369,216		$	352,962		$	1,492,026		$	830,619
Multifamily real estate		17,980			13,240			0			35,870			4,215
Commercial real estate		83,774			67,131			24,760			163,315			131,001
Construction		341,961			579,287			720,057			2,191,620			2,334,638
Consumer — direct		92,009			90,440			65,456			359,338			327,027
Consumer — indirect		57,383			63,001			62,158			242,309			189,505
Commercial banking		199,136			198,317			229,954			995,732			1,154,304

Total loan origination volume	$	1,115,514		$	1,380,632		$	1,455,347		$	5,480,210		$	4,971,309


PERFORMANCE RATIOS:
Return on average assets		0.56	%		0.91	%		0.96	%		0.83	%		0.88	%
Return on average assets, core ⁽¹⁾		0.61	%		0.91	%		0.97	%		0.86	%		0.89	%
Return on average shareholders’ equity		5.7	%		9.3	%		13.2	%		8.6	%		13.0	%
Return on average shareholders’ equity, core ⁽¹⁾		6.3	%		9.3	%		13.3	%		8.9	%		13.0	%
Return on average tangible equity ⁽²⁾		9.8	%		16.2	%		18.6	%		14.8	%		17.7	%
Operating efficiency		67.1	%		62.9	%		61.9	%		63.6	%		61.9	%
Operating efficiency, core ⁽¹⁾		65.3	%		62.7	%		61.6	%		62.7	%		61.7	%
Non interest expense to average assets (annualized)		2.52	%		2.54	%		2.58	%		2.53	%		2.46	%
Average assets	$	11,954,428		$	11,596,478		$	9,197,563		$	11,267,427		$	8,398,563
Average shareholders’ equity	$	1,170,162		$	1,135,886		$	671,011		$	1,084,417		$	569,972
Average tangible equity ⁽²⁾	$	684,747		$	647,919		$	474,619		$	632,100		$	418,484

REGULATORY CAPITAL RATIOS:
Sterling Financial Corporation:
Tier 1 leverage (to average assets)		8.7	%		9.1	%		8.7	%		8.7	%		8.7	%
Tier 1 (to risk-weighted assets)		10.1	%		10.2	%		10.0	%		10.1	%		10.0	%
Total (to risk-weighted assets)		11.3	%		11.3	%		11.1	%		11.3	%		11.1	%
Sterling Savings Bank:
Tier 1 leverage (to average assets)		8.5	%		8.6	%		8.6	%		8.5	%		8.6	%
Tier 1 (to risk-weighted assets)		9.8	%		9.8	%		9.7	%		9.8	%		9.7	%
Total (to risk-weighted assets)		11.0	%		11.0	%		10.8	%		11.0	%		10.8	%

OTHER:
Sales of financial products	$	34,794		$	106,384		$	32,884		$	211,672		$	143,863
FTE employees at end of period (whole numbers)		2,571			2,566			2,405			2,571			2,405


(1)		See Exhibit A.

(2)		Average tangible equity is average shareholders’ equity less average net goodwill and other intangible assets.

Sterling Financial Corporation
OTHER SELECTED FINANCIAL DATA
(in thousands, unaudited)


	Dec 31,			Sept 30,			Dec 31,
	2007			2007			2006
LOANS BY COLLATERAL TYPE:
Residential real estate	$	703,826		$	673,058		$	654,661
Multifamily real estate		389,388			377,204			263,053
Commercial real estate		1,223,036			1,217,458			795,386
Construction		2,944,911			2,877,253			2,290,882
Consumer — direct		798,519			777,764			749,626
Consumer — indirect		376,937			358,854			288,704
Commercial banking		2,639,196			2,586,233			2,069,086
Deferred loan fees, net		(16,480	)		(18,352	)		(12,308	)
Allowance for losses on loans		(111,026	)		(102,042	)		(77,849	)

Net loans receivable	$	8,948,307		$	8,747,430		$	7,021,241


ALLOWANCE FOR CREDIT LOSSES:
Allowance — loans, beginning of quarter	$	102,042		$	99,634		$	66,505
Acquired		0			0			8,603
Provision		13,000			3,638			4,705
Charge offs, net of recoveries		(4,016	)		(1,230	)		(1,082	)
Transfers		0			0			(882	)

Allowance — loans, end of quarter		111,026			102,042			77,849

Allowance — unfunded commitments, beginning of quarter		6,304			6,047			4,958
Provision		2			257			0
Transfers		0			0			882

Allowance — unfunded commitments, end of quarter		6,306			6,304			5,840

Total credit allowance	$	117,332		$	108,346		$	83,689


Net charge-offs to average net loans (annualized)		0.18	%		0.06	%		0.06	%
Net charge-offs to average net loans (ytd)		0.08	%		0.03	%		0.06	%
Loan loss allowance to total loans		1.23	%		1.15	%		1.10	%
Total credit allowance to total loans		1.30	%		1.22	%		1.18	%
Loan loss allowance to nonperforming loans (excluding loans classified as loss)		95.8	%		195.3	%		1335.0	%
Total allowance to nonperforming loans		101.8	%		207.9	%		1437.0	%
Nonperforming loans to loans		1.27	%		0.61	%		0.10	%

NONPERFORMING ASSETS:
Past 90 days due	$	0		$	0		$	0
Nonaccrual loans		115,112			54,268			7,107
Restructured loans		350			0			0

Total nonperforming loans		115,462			54,268			7,107
REO		11,075			3,427			4,052

Total nonperforming assets (NPA)	$	126,537		$	57,695		$	11,159

NPA to total assets		1.04	%		0.49	%		0.11	%
Loan delinquency ratio (60 days and over)		1.23	%		0.53	%		0.10	%
Classified assets	$	234,336		$	215,582		$	48,356
Classified assets/total assets		1.93	%		1.84	%		0.49	%

DEPOSITS DETAIL:
Interest-bearing transaction accounts	$	469,428		$	465,835		$	483,551
Noninterest-bearing transaction accounts		898,606			913,932			834,140
Savings and money market demand accounts		2,156,808			2,136,253			1,830,313
Time deposits		4,152,930			4,250,372			3,598,024

Total deposits	$	7,677,772		$	7,766,392		$	6,746,028


Number of transaction accounts (whole numbers):
Interest-bearing transaction accounts		47,234			47,865			48,730
Noninterest-bearing transaction accounts		149,834			147,768			136,628

Total transaction accounts		197,068			195,633			185,358

Sterling Financial Corporation
AVERAGE BALANCE, YIELDS AND RATES PAID
(in thousands, unaudited)


	Three Months Ended
	December 31, 2007							September 30, 2007							December 31, 2006
	Average				Average			Average				Average			Average				Average
	Balance		Amount		Rate			Balance		Amount		Rate			Balance		Amount		Rate
ASSETS:
Loans:
Mortgage	$	5,326,563	$	104,008		7.75	%	$	5,133,534	$	105,455		8.15	%	$	3,908,164	$	80,275		8.15	%
Commercial and consumer		3,751,270		71,398		7.55	%		3,708,768		73,811		7.90	%		2,861,582		57,377		7.95	%

Total loans		9,077,833		175,406		7.67	%		8,842,302		179,266		8.04	%		6,769,746		137,652		8.07	%
MBS		1,683,267		20,560		4.85	%		1,584,178		18,882		4.73	%		1,760,764		20,954		4.72	%
Investments and cash		285,415		2,993		4.16	%		271,197		2,613		3.82	%		223,678		1,736		3.08	%

Total interest-earning assets		11,046,515		198,959		7.15	%		10,697,677		200,761		7.45	%		8,754,188		160,342		7.27	%

Noninterest-earning assets		907,913							898,801							443,375

Total average assets	$	11,954,428						$	11,596,478						$	9,197,563


LIABILITIES and EQUITY:
Deposits:
Transaction	$	1,366,137		514		0.15	%	$	1,396,067		577		0.16	%	$	1,191,983		509		0.17	%
Savings		2,158,234		17,688		3.25	%		2,140,219		18,968		3.52	%		1,692,307		14,905		3.49	%
Time deposits		4,266,725		53,537		4.98	%		4,088,063		51,944		5.04	%		3,410,706		42,487		4.94	%

Total deposits		7,791,096		71,739		3.65	%		7,624,349		71,489		3.72	%		6,294,996		57,901		3.65	%
Borrowings		2,791,340		34,318		4.88	%		2,640,580		34,765		5.22	%		2,159,318		27,973		5.14	%

Total interest-bearing liabilities		10,582,436		106,057		3.98	%		10,264,929		106,254		4.11	%		8,454,314		85,874		4.03	%

Noninterest-bearing liabilities		201,830							195,663							72,238

Total average liabilities		10,784,266							10,460,592							8,526,552
Total average shareholders’ equity		1,170,162							1,135,886							671,011

Total average liabilities and equity	$	11,954,428						$	11,596,478						$	9,197,563


Tax equivalent net interest income and spread			$	92,902		3.17	%			$	94,507		3.34	%			$	74,468		3.24	%


Tax equivalent net interest margin						3.34	%						3.50	%						3.37	%

Sterling Financial Corporation
AVERAGE BALANCE, YIELDS AND RATES PAID
(in thousands, unaudited)


	Twelve Months Ended
	December 31, 2007							December 31, 2006
	Average				Average			Average				Average
	Balance		Amount		Rate			Balance		Amount		Rate
ASSETS:
Loans:
Mortgage	$	4,994,656	$	401,084		8.03	%	$	3,291,944	$	257,811		7.83	%
Commercial and consumer		3,568,815		279,422		7.83	%		2,599,651		201,133		7.74	%

Total loans		8,563,471		680,506		7.95	%		5,891,595		458,944		7.79	%
MBS		1,655,371		79,266		4.79	%		1,862,144		88,398		4.75	%
Investments and cash		270,384		10,302		3.81	%		233,611		5,500		2.35	%

Total interest-earning assets		10,489,226		770,074		7.34	%		7,987,350		552,842		6.92	%

Noninterest-earning assets		778,201							411,213

Total average assets	$	11,267,427						$	8,398,563


LIABILITIES and EQUITY:
Deposits:
Transaction	$	1,359,066		2,543		0.19	%	$	1,106,321		1,692		0.15	%
Savings		2,078,984		71,665		3.45	%		1,512,198		47,844		3.16	%
Time deposits		4,039,152		203,406		5.04	%		2,962,017		135,737		4.58	%

Total deposits		7,477,202		277,614		3.71	%		5,580,536		185,273		3.32	%
Borrowings		2,604,764		134,004		5.14	%		2,125,620		101,670		4.78	%

Total interest-bearing liabilities		10,081,966		411,618		4.08	%		7,706,156		286,943		3.72	%

Noninterest-bearing liabilities		101,044							122,435

Total average liabilities		10,183,010							7,828,591
Total average shareholders’ equity		1,084,417							569,972

Total average liabilities and equity	$	11,267,427						$	8,398,563


Tax equivalent net interest income and spread			$	358,456		3.26	%			$	265,899		3.20	%

Tax equivalent net interest margin						3.42	%						3.33	%

Sterling Financial Corporation
EXHIBIT A- RECONCILIATION SCHEDULE
(in thousands, unaudited)


	Three Months Ended									Twelve Months Ended
	Dec 31,			Sept 30,			Dec 31,			Dec 31,			Dec 31,
	2007			2007			2006			2007			2006
CORE EARNINGS: ⁽¹⁾
Net income as reported	$	16,857		$	26,530		$	22,260		$	93,289		$	73,946
Add back: merger and acquisition costs, net of tax		599			165			166			1,785			286
Add back: other nonrecurring costs, net of tax		991			0			0			1,449			128

Core earnings	$	18,447		$	26,695		$	22,426		$	96,523		$	74,360


CORE EARNINGS PER SHARE — BASIC: ⁽¹⁾
Earnings per share — basic, as reported	$	0.33		$	0.52		$	0.57		$	1.87		$	2.03
Add back: merger and acquisition costs, net of tax		0.01			0.00			0.00			0.04			0.01
Add back: other nonrecurring costs, net of tax		0.02			0.00			0.01			0.03			0.00

Core earnings per share — basic	$	0.36		$	0.52		$	0.58		$	1.94		$	2.04


CORE EARNINGS PER SHARE — DILUTED: ⁽¹⁾
Earnings per share — diluted, as reported	$	0.33		$	0.51		$	0.57		$	1.86		$	2.01
Add back: merger and acquisition costs, net of tax		0.01			0.01			0.00			0.03			0.01
Add back: other nonrecurring costs, net of tax		0.02			0.00			0.00			0.03			0.00

Core earnings per share — diluted	$	0.36		$	0.52		$	0.57		$	1.92		$	2.02


RETURN ON AVERAGE ASSETS, CORE: ⁽¹⁾
Return on average assets, as reported		0.56	%		0.91	%		0.96	%		0.83	%		0.88	%
Add back: merger and acquisition costs, net of tax		0.02	%		0.00	%		0.01	%		0.02	%		0.01	%
Add back: other nonrecurring costs, net of tax		0.03	%		0.00	%		0.00	%		0.01	%		0.00	%

Return on average assets, core		0.61	%		0.91	%		0.97	%		0.86	%		0.89	%


RETURN ON AVERAGE SHAREHOLDERS’ EQUITY, CORE: ⁽¹⁾
Return on average shareholders’ equity, as reported		5.7	%		9.3	%		13.2	%		8.6	%		13.0	%
Add back: merger and acquisition costs, net of tax		0.2	%		0.0	%		0.1	%		0.2	%		0.0	%
Add back: other nonrecurring costs, net of tax		0.4	%		0.0	%		0.0	%		0.1	%		0.0	%

Return on average shareholders’ equity, core		6.3	%		9.3	%		13.3	%		8.9	%		13.0	%


OPERATING EFFICIENCY RATIO, CORE: ⁽¹⁾
Operating efficiency ratio, as reported		67.1	%		62.9	%		61.9	%		63.6	%		61.9	%
Subtract: merger and acquisition costs		(0.9	%)		(0.2	%)		(0.3	%)		(0.6	%)		(0.1	%)
Subtract: other nonrecurring costs		(0.9	%)		0.0	%		0.0	%		(0.3	%)		(0.1	%)

Operating efficiency ratio, core		65.3	%		62.7	%		61.6	%		62.7	%		61.7	%


(1)		Core earnings per share excludes net securities gains (losses), merger and acquisition costs, and other nonrecurring costs, net of related income taxes. Core earnings is a non-GAAP financial measure. Management believes that this presentation of non-GAAP information regarding core earnings provides useful information to investors regarding the registrant’s financial condition and results of operations as core earnings are widely used for comparison purposes in the financial services industry.