Cascade Bancorp (CACB) 8-K Results of Operations and Financial Condition

October 23, 2008

NEWS RELEASE

FOR IMMEDIATE RELEASE

CONTACT: Gregory D. Newton, EVP, Chief Financial Officer, Cascade Bancorp

(541) 617-3526

Patricia L. Moss, President & Chief Executive Officer, Cascade Bancorp

(541) 385-6205

CASCADE BANCORP (OREGON) ANNOUNCES THIRD QUARTER 2008 POSITIVE NET INCOME OF $0.6 MILLION OR $0.02 EARNINGS PER SHARE WHILE INCREASING RESERVE FOR CREDIT LOSSES TO NEARLY $45 MILLION OR 2.18% OF LOANS; Q3 NON-PERFORMING ASSETS SLIGHTLY BELOW PRIOR QUARTER

· Credit Quality: Reserve for credit losses increased to $44.8 million or a strong 2.18% of total loans.  

· Credit Quality: Non-performing assets (NPAs) eased from immediately preceding (linked) quarter.

· Capital Ratios: up to 11.47% with $53 million surplus above “well-capitalized.” (tax equivalent basis)

· Earnings Per Share: at $0.02 with net income at $0.6 million.

· Total Deposits: 1.9% below year ago; up 10.8% on a linked-quarter basis.

· Total Loans: up 0.4% year-over-year and down slightly from the linked-quarter.

· Net Interest Margin: 4.42% vs. 4.52% on a linked-quarter basis.

FINANCIAL PERFORMANCE:

BEND, Ore, October 23/PRNewswire-First Call/--Cascade Bancorp (“Cascade”) (NASDAQ: CACB) reported third quarter 2008 DilutedEarnings Per Share (EPS-diluted) at $0.02 per share compared to $0.35 for the year-ago quarter and $0.01 for the linked-quarter. The Company reported continued positive Net Income for the third quarter 2008 of $0.6 million versus $10.0 million a year-ago and up from $0.2 million for the linked-quarter. Year- to-date net income is $6.8 million or $0.24 per share.

“We are pleased to report ongoing positive earnings for the third quarter and year-to-date. In response to challenging economic times most of this quarter’s earnings were offset by increased reserves for credit losses,” said Patricia L. Moss, CEO. “We are encouraged that, apart from the known issues in our residential land development portfolio, credit quality metrics in other loan categories were stable during the quarter. We believe our proactive and consistent efforts to monitor, recognize, and remediate loan issues contributed to our overall credit quality.” She concluded “Our financial strength, 'well-capitalized' status, substantial reserves and strong cash flow generation provide the resources necessary to meet the challenges of today and supports our customers’ confidence in Bank of the Cascades.”

Management believes Cascade’s credit quality issues continue to be largely confined within the residential development portfolio, which represents approximately 13% of total loans. Accordingly, third quarter 2008 includes a $15.0 million (pre-tax) provision for credit losses and net loan charge-offs of $8.2 million (pre-tax) mainly related to the residential development portfolio. As a result of the heightened provision, the Reserve for Credit Losses increased to nearly $45 million or a solid 2.18% of total loans, up from 1.94% and 1.37% for the linked-quarter and year-ago period, respectively. In addition to its strong reserves, the Company has $163.3 million in tangible capital and is designated a “well-capitalized” bank according to regulatory guidelines with estimated total risk-based capital at 11.47% as of September 30, 2008, exceeding the 10% benchmark by a tax-effected margin of approximately $53.3 million. Further, Cascade’s pre-tax, pre-provision earnings are in the top 15% of banks in the nation its size.

LOAN PORTFOLIO AND CREDIT QUALITY:

At September 30, 2008, Cascade’s Loan Portfolio was $2.05 billion, essentially flat as compared to a year-ago and on a linked-quarter basis. Management believes that overall loan growth will likely remain muted until such time as the economic downturn runs its course. We continue to assist consumer and business relationship customers with their credit needs. Because of the nature of its markets, real estate has historically represented a significant portion of the Company’s overall loan portfolio and is frequently a material component of collateral for the Company’s loans.

At September 30, 2008, loans delinquent >30 days were steady at 0.21% of total loans compared to 0.19% for the linked-quarter and 0.46% at year-end 2007. This compares favorably to peer banks whose average delinquency rates were 0.89% at prior quarter end. Delinquency rates in commercial real estate (CRE) and commercial (C&I) portfolios were 0.03% and 0.08% respectively, indicating continued stable credit quality at this time.

2

NPAs (including non-performing loans and certain other real estate owned (OREO)) were modestly lower at $109.1 million, or 4.5% of total assets compared to $127.1 million or 5.2% of total assets for the linked-quarter. NPAs are primarily related to the Company’s residential land acquisition and development loan portfolio. The decrease in NPAs primarily resulted largely from reclassification of a previously reported non-performing OREO as mentioned below. See accompanying table for distribution of loans and NPAs by region.

OREO was $37.2 million at September 30, 2008 compared to $33.9 million in the prior quarter. During the quarter the Company sold 10 OREO lots, while approximately $5.5 million in assets were added to OREO at estimated fair value, primarily in residential land development assets. Note that beginning with the third quarter approximately $16.2 million of OREO balance is not classified as non-performing because it was determined that the commercial building revenues being received on a particular OREO property exceeded the interest income previously received on the underlying loan. Apart from this adjustment, NPAs were slightly lower as compared to the prior quarter.

The Company carries NPAs at the estimated net realizable fair value; however, because of the uncertain real estate market, no assurance can be given that the ultimate disposition of such assets will be at or above such value. The orderly resolution of non-performing loans as well as expedient disposition of OREO properties is a priority for management.

Management believes the reserve for credit losses is at an appropriate level based on frequently updated evaluation and analysis of portfolio credit quality in conjunction with prevailing economic conditions. With uncertainty as to the depth and duration of the real estate slowdown and its economic effect on the communities within Cascades’ banking markets, forward assurances cannot be given that the reserve will be adequate in future periods or that the level of NPAs will subside. Further provisioning and charge-offs may be required before values stabilize.

DEPOSITS:

Customer Relationship Deposits¹continued to ease during the third quarterreflecting the slowing economy. Such deposits totaled $1.4 billion at September 30, 2008, down 12.6% compared to a year-ago and down 3.1% on a linked-quarter basis.Total Deposits were $1.8 billion at September 30, 2008, down 1.9% compared to a year-ago but up 10.8% on a linked-quarter basis as the bank accessed the brokered time deposit market to augment aggregate deposits. Note that Cascade’s proportion of time deposits to total deposits continues to remain well below its peer banks because of its focus on relationship deposits.

^{_____________________________________}

¹ Customer relationship deposits include core deposit transaction accounts such as checking, money market and savings, while excluding all wholesale or brokered deposits and time deposits greater than $100,000.

3

NET INTEREST MARGIN & INTEREST RATE RISK:

Third quarter 2008 Net Interest Margin (NIM) was 4.42% compared to 4.52% for the linked-quarter, and 5.24% for the year-ago quarter. While the overall cost of funds remained unchanged at 1.90% from the prior quarter, the lower NIM was primarily due to interest reversed and foregone on non-performing loans and lower loan fees.

Yields on earning assets during the third quarter of 2008 were 6.28% compared to 6.38% in the linked-quarter and down from 8.29% in the year-ago quarter. The year-over-year and linked-quarter decline in yields were mainly a result of declining market rates as well as the effect of interest forgone and reversed on non-performing loans. The average rate paid on interest bearing liabilities was relatively flat at 2.35% for the current quarter as compared to 2.37% for the linked-quarter and is below the 4.11% for the year ago quarter due to declining rate environment.

Because one of Cascade’s strengths is its relatively high proportion of non-interest bearing deposits, lower market interest rates may modestly compress the Company’s NIM as yields decline against an already low cost of funds. Importantly, this effect should also reverse once the economy rebounds. See cautionary “Forward Looking Statements” below and in Cascade’s Form 10-K report for further information on risk factors including interest rate risk.

NON-INTEREST INCOME AND EXPENSE:

Non-Interest Income for the third quarter of 2008 was $5.5 million compared to the year-ago quarter of $5.2 million and $5.0 million for the linked-quarter. The increase was mainly a result of a $0.4 million in gain on the sales of investment securities. Note that other income includes approximately $0.3 million in realized revenue primarily on the performing OREO property discussed above. Bank service and other fee income categories were generally flat.

4

As a result of tightening credit conditions and related home-buyer caution, residential mortgage originations were down 41.3% to $21.3 million for the current quarter compared to $36.3 million in the linked-quarter and down 45.1% from the year-ago period. Lower originations caused net mortgage related revenues to decline $0.3 million in the third quarter of 2008 when compared to the both linked-quarter and year-ago periods. Note that the Company has focused on originating conventional mortgage products throughout its history while purposefully avoiding sub-prime / option-ARM type products. As a result, the delinquency rate within Cascade’s $510 million portfolio of serviced residential mortgage loans is only 0.55%, notably below the national mortgage delinquency rate of 6.41% at September30, 2008. The fair value of servicing portfolio is estimated to exceed book value by amounts ranging from $1.2 million to $2.3 million.

Non-Interest Expense decreased compared to prior periods primarily due to a $2.1 million reduction in the reserve for unfunded commitments as a result of declining outstanding commitments and lower estimated reserve rates. Excluding this factor, normalized non interest expense levels for the third quarter were down 5.1% compared to the linked-quarter and up 3.9% from the year-ago period. When compared to the year-ago quarter, adjusted expenses were higher due to OREO and related costs which totaled approximately $0.5 million for the quarter. Management anticipates that aside from the possible volatility of OREO related costs, normalized non interest expense levels should be flat to down slightly during the next quarter.

Cascade is currently evaluating the federal government's Troubled Asset Relief Program created pursuant to the recently enacted Emergency Economic Stabilization Act, which includes legislation concerning access to capital, problem asset resolution and other items.

5

BUSINESS STRATEGY:

Operating in some of the fastest growing markets in the nation, Cascade Bancorp (headquartered in Bend, Oregon) and its wholly-owned subsidiary, Bank of the Cascades, operates in Oregon and Idaho markets. In terms of banking growth markets, Cascade ranks as the top community bank footprint in the Northwest. Cascade has a business strategy that focuses on delivering the best in community banking for the financial well-being of customers and shareholders. The Bank implements its strategy by combining outstanding service, competitive financial products, local expertise and advanced technology applied for the convenience of customers. Founded in 1977, Bank of the Cascades offers full-service community banking through 33 branches in Central Oregon, Southern Oregon, Portland/Salem and Boise/Treasure Valley. The Bank has been repeatedly named among the top performing banks in the nation by industry publications. The Bank is honored to be among the top Oregon "Best 100 Companies to Work For”, as compiled by Oregon Business Magazine. For further information on Bank of the Cascades, please visit our web site at http://www.botc.com. 

FORWARD LOOKING STATEMENTS

This release contains forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties may include but are not necessarily limited to general and local economic conditions, including the residential and commercial real estate markets; changes in interest rates, including timing or relative degree of change; inflation; credit quality and concentrations; competition within the business areas in which Cascade is conducting its operations; changes in regulatory conditions or requirements or new legislation; and changes in accounting policies. These statements include, among others, statements related to future profitability levels and future earnings. For a discussion of factors, which could cause results to differ, please see Cascade's reports on Forms 10-K and 10-Q as filed with the Securities and Exchange Commission and Cascade's press releases. When used in this release, the words or phrases such as "will likely result in", "management expects that", "will continue", "is anticipated", "estimate", "projected", or similar expressions constitute forward-looking statements, as do any other statements that expressly or implicitly predict future events, results or performance, and such statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Readers should not place undue reliance on the forward-looking statements, which reflect management's view only as of the date hereof. Cascade undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances.

# # #

6

CASCADE BANCORP

Selected Consolidated Financial Highlights

(In thousands, except per share data and ratios; unaudited)

	Year over Year									Linked Quarter
	3rd Qtr			3rd Qtr			%			3rd Qtr			2nd Qtr			%
Balance Sheet Data (at period end)	2008			2007			Change			2008			2008			Change
Investment securities	$	84,647		$	97,857			-13.5	%	$	84,647		$	90,492			-6.5	%
Loans, gross		2,049,695			2,041,573			0.4	%		2,049,695			2,066,091			-0.8	%
Total assets		2,410,535			2,403,717			0.3	%		2,410,535			2,443,888			-1.4	%
Total deposits		1,757,883			1,792,301			-1.9	%		1,757,883			1,586,666			10.8	%
Non-interest bearing deposits		446,470			471,140			-5.2	%		446,470			417,076			7.0	%
Customer relationship deposits (1)		1,409,819			1,612,950			-12.6	%		1,409,819			1,454,865			-3.1	%
Total shareholders' equity (book)		276,706			284,737			-2.8	%		276,706			276,033			0.2	%
Total shareholders' equity (tangible)		163,343			169,793			-3.8	%		163,343			162,275			0.7	%
Income Statement Data
Interest income	$	34,111		$	43,956			-22.4	%	$	34,111		$	34,260			-0.4	%
Interest expense		10,146			16,232			-37.5	%		10,146			10,014			1.3	%
Net interest income		23,965			27,724			-13.6	%		23,965			24,246			-1.2	%
Loan loss provision		15,024			1,750			758.5	%		15,024			12,600			19.2	%
Net interest income after loan loss provision		8,941			25,974			-65.6	%		8,941			11,646			-23.2	%
Noninterest income		5,530			5,198			6.4	%		5,530			5,008			10.4	%
Noninterest expense		13,809			15,319			-9.9	%		13,809			16,763			-17.6	%
Income (loss) before income taxes		662			15,853			-95.8	%		662			(109	)		-707.3	%
Provision (credit) for income taxes		88			5,835			-98.5	%		88			(290	)		130.3	%
Net income	$	574		$	10,018			-94.3	%	$	574		$	181			217.1	%
Share Data
Basic earnings per common share	$	0.02		$	0.35			-94.2	%	$	0.02		$	0.01			217.0	%
Diluted earnings per common share	$	0.02		$	0.35			-94.1	%	$	0.02		$	0.01			217.0	%
Book value per common share	$	9.85		$	10.06			-2.1	%	$	9.85		$	9.83			0.2	%
Tangible book value per common share	$	5.82		$	6.00			-3.1	%	$	5.82		$	5.78			0.6	%
Cash dividends paid per common share	$	0.01		$	0.09			-88.9	%	$	0.01		$	0.10			-90.0	%
Ratio of dividends declared to net income		48.67	%		25.46	%		91.2	%		48.67	%		1543.04	%		-96.8	%
Basic Average shares outstanding		27,947			28,340			-1.4	%		27,947			27,929			0.1	%
Fully Diluted average shares outstanding		28,078			28,673			-2.1	%		28,078			28,061			0.1	%
Key Ratios
Return on average total shareholders' equity (book)		0.80	%		14.25	%		-94.4	%		0.80	%		0.26	%		207.7	%
Return on average total shareholders' equity (tangible) (2)		1.34	%		24.26	%		-94.5	%		1.34	%		0.43	%		211.6	%
Return on average total assets		0.09	%		1.69	%		-94.7	%		0.09	%		0.03	%		200.0	%
Pre-tax pre provision return on average total assets		2.57	%		2.97	%		-13.4	%		2.57	%		2.08	%		23.5	%
Net interest spread		3.91	%		4.18	%		-6.5	%		3.91	%		4.02	%		-2.7	%
Net interest margin		4.42	%		5.24	%		-15.6	%		4.42	%		4.52	%		-2.2	%
Total revenue (net int inc + non int inc)	$	29,495		$	32,922			-10.4	%	$	29,495		$	29,254			0.8	%
Efficiency ratio (3)		53.94	%		46.53	%		15.9	%		53.94	%		57.30	%		-5.9	%
Credit Quality Ratios
Reserve for credit losses		44,760			27,955			60.1	%		44,760			40,036			11.8	%
Reserve to ending total loans		2.18	%		1.37	%		59.5	%		2.18	%		1.94	%		12.7	%
Non-performing assets (4)		109,072			21,474			407.9	%		109,072			127,105			-14.2	%
Non-performing assets to total assets		4.52	%		0.89	%		406.5	%		4.52	%		5.20	%		-13.0	%
Delinquent >30 days to total loans		0.21	%		0.09	%		146.4	%		0.21	%		0.19	%		12.0	%
Net charge-offs		8,176			1,554			426.1	%		8,176			9,927			-17.6	%
Net loan charge-offs (annualized)		1.58	%		0.31	%		408.2	%		1.58	%		1.93	%		-18.0	%
Mortgage Activity
Mortgage Originations	$	21,308		$	38,810			-45.1	%	$	21,308		$	36,296			-41.3	%
Total Servicing Portfolio (sold loans)	$	509,513		$	493,638			3.2	%	$	509,513		$	510,727			-0.2	%
Capitalized Mortgage Servicing Rights (MSRs)	$	3,679		$	3,841			-4.2	%	$	3,679		$	3,810			-3.4	%
Capital Ratios
Average shareholders' equity to average assets		11.65	%		11.85	%		-1.7	%		11.65	%		11.69	%		-0.3	%
Leverage ratio (5) (Est Q3-08)		9.91	%		10.52	%		-5.8	%		9.91	%		9.93	%		-0.2	%
Total risk-based capital ratio (5) (Est Q3-08)		11.47	%		11.58	%		-0.9	%		11.47	%		11.24	%		2.0	%

Notes:

(1) Customer relationship deposits include core deposit transaction accounts such as checking, money market and savings, while excluding all wholesale or brokered deposits and time deposits greater than $100,000.

(2) Excludes goodwill, core deposit intangible and other identifiable intangible assets, related to the acquisitions of Community Bank of Grants Pass and F&M Holding Company.

(3) Efficiency ratio is noninterest expense (adj for one-time adjs) divided by (net interest income + noninterest income).

(4) Non-performing assets consist of loans contractually past due 90 days or more, nonaccrual loans and other real estate owned.

(5) Computed in accordance with FRB and FDIC guidelines.

Total Shares Outstanding as of 9/30/08: 28,087,198

7

CASCADE BANCORP (CACB)

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)

(unaudited)

	Year over Year Quarter								Linked Quarter						Year over Year YTD
	3rd Qtr			3rd Qtr		%			2nd Qtr			%			Nine months ended September 30,				%
	2008			2007		Change			2008			Change			2008		2007		Change
Interest income:
Interest and fees on loans	$	32,938		$	42,547		-22.6	%	$	33,079			-0.4	%	$	103,015	$	124,115		-17.0	%
Taxable interest on investments		1,093			1,290		-15.3	%		1,068			2.3	%		3,212		3,945		-18.6	%
Nontaxable interest on investments		40			66		-39.4	%		53			-24.5	%		154		222		-30.6	%
Interest on federal funds sold		(6	)		41		-114.6	%		10			-160.0	%		17		149		-88.6	%
Interest on interest bearing balances from FHLB		45			1		4400.0	%		1			4400.0	%		3		193		-98.4	%
Dividends on Federal Home Loan Bank stock		1			11		-90.9	%		49			-98.0	%		111		28		296.4	%
Total interest income		34,111			43,956		-22.4	%		34,260			-0.4	%		106,512		128,652		-17.2	%
Interest expense:
Deposits:
Interest bearing demand		3,396			8,388		-59.5	%		3,934			-13.7	%		13,050		22,602		-42.3	%
Savings		36			49		-26.5	%		35			2.9	%		110		157		-29.9	%
Time		3,045			4,369		-30.3	%		2,469			23.3	%		8,628		12,340		-30.1	%
Junior subordinated debentures and other borrowings		3,669			3,426		7.1	%		3,576			2.6	%		11,453		11,739		-2.4	%
Total interest expense		10,146			16,232		-37.5	%		10,014			1.3	%		33,241		46,838		-29.0	%
Net interest income		23,965			27,724		-13.6	%		24,246			-1.2	%		73,271		81,814		-10.4	%
Loan loss provision		15,024			1,750		758.5	%		12,600			19.2	%		32,124		3,800		745.4	%
Net interest income after loan loss provision		8,941			25,974		-65.6	%		11,646			-23.2	%		41,147		78,014		-47.3	%
Noninterest income:
Service charges on deposit accounts		2,552			2,597		-1.7	%		2,537			0.6	%		7,490		7,295		2.7	%
Mortgage loan origination and processing fees		279			423		-34.0	%		406			-31.3	%		1,138		1,363		-16.5	%
Gains on sales of mortgage loans, net		53			183		-71.0	%		194			-72.7	%		483		681		-29.1	%
Gains on sales of investment securities AFS		436			260		67.7	%		-			100.0	%		436		260		67.7	%
Gains on sales of other real estate owned		62			-		100.0	%		-			100.0	%		35		-		100.0	%
Card issuer and merchant services fees, net		982			1,038		-5.4	%		1,005			-2.3	%		2,879		2,988		-3.6	%
Earnings on bank-owned life insurance		211			140		50.7	%		287			-26.5	%		763		983		-22.4	%
Other income		955			557		71.5	%		579			64.9	%		2,816		2,448		15.0	%
Total noninterest income		5,530			5,198		6.4	%		5,008			10.4	%		16,040		16,018		0.1	%
Noninterest expense:
Salaries and employee benefits		8,959			8,925		0.4	%		9,093			-1.5	%		27,211		27,261		-0.2	%
Occupancy & equipment		1,695			1,725		-1.7	%		1,713			-1.1	%		5,233		4,952		5.7	%
Communications		545			491		11.0	%		491			11.0	%		1,592		1,512		5.3	%
Advertising		333			330		0.9	%		348			-4.3	%		1,006		960		4.8	%
Legal		169			206		-18.0	%		307			-45.0	%		826		415		99.0	%
OREO & collection expenses		494			8		6075.0	%		1,186			-58.3	%		2,452		29		8355.2	%
Other expenses		1,614			3,634		-55.6	%		3,625			-55.5	%		9,627		11,540		-16.6	%
Total noninterest expense		13,809			15,319		-9.9	%		16,763			-17.6	%		47,947		46,669		2.7	%
Income (loss) before income taxes		662			15,853		-95.8	%		(109	)		-706.9	%		9,240		47,363		-80.5	%
Provision (credit) for income taxes		88			5,835		-98.5	%		(290	)		130.3	%		2,445		17,643		-86.1	%
Net income	$	574		$	10,018		-94.3	%	$	181			216.9	%	$	6,795	$	29,720		-77.1	%
Basic net income per common share	$	0.02		$	0.35		-94.2	%	$	0.01			215.4	%	$	0.24	$	1.05		-76.8	%
Diluted net income per common share	$	0.02		$	0.35		-94.2	%	$	0.01			218.8	%	$	0.24	$	1.04		-76.6	%

8

CASCADE BANCORP (CACB)

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

(unaudited)

	Year over Year							Linked Quarter
	3rd Qtr		3rd Qtr		%			2nd Qtr		%
	2008		2007		Change			2008		Change
ASSETS
Cash and cash equivalents:
Cash and due from banks	$	50,616	$	60,363		-16.1	%	$	63,903		-20.8	%
Interest bearing balances due from FHLB		64		72		-11.1	%		39		64.1	%
Federal funds sold		2,938		807		264.1	%		-		100.0	%
Total cash and cash equivalents		53,618		61,242		-12.4	%		63,942		-16.1	%
Investment securities available-for-sale		82,436		94,675		-12.9	%		88,279		-6.6	%
Investment securities held-to-maturity		2,211		3,182		-30.5	%		2,212		0.0	%
Federal Home Loan Bank stock		13,366		6,991		91.2	%		12,087		10.6	%
Loans, net		2,005,974		2,016,781		-0.5	%		2,029,218		-1.1	%
Premises and equipment, net		36,382		38,878		-6.4	%		36,312		0.2	%
Goodwill		105,047		105,047		0.0	%		105,047		0.0	%
Core deposit intangible		8,316		9,897		-16.0	%		8,711		-4.5	%
Bank-owned life insurance		34,067		32,713		4.1	%		33,857		0.6	%
Other real estate owned (OREO)		37,196		375		9818.9	%		33,943		9.6	%
Accrued interest and other assets		31,922		33,936		-5.9	%		30,280		5.4	%
Total assets	$	2,410,535	$	2,403,717		0.3	%	$	2,443,888		-1.4	%
LIABILITIES & STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
Demand	$	446,470	$	471,140		-5.2	%	$	417,076		7.0	%
Interest bearing demand		747,865		949,162		-21.2	%		832,840		-10.2	%
Savings		38,459		41,142		-6.5	%		37,204		3.4	%
Time deposits		525,090		330,857		58.7	%		299,546		75.3	%
Total deposits		1,757,884		1,792,301		-1.9	%		1,586,666		10.8	%
Junior subordinated debentures		68,558		68,558		0.0	%		68,558		0.0	%
Federal funds purchased		-		15,035		100.0	%		87,481		-100.0	%
Other borrowings		279,029		200,799		39.0	%		395,986		-29.5	%
Customer repurchase agreements		11,925		16,581		-28.1	%		11,864		0.5	%
Accrued interest and other liabilities		16,433		25,706		-36.1	%		17,300		-5.0	%
Total liabilities		2,133,829		2,118,980		0.7	%		2,167,855		-1.6	%
Stockholders' equity:
Common stock, no par value;		158,158		164,200		-3.7	%		157,706		0.3	%
Retained earnings		118,518		120,150		-1.4	%		118,224		0.2	%
Unrealized gains on investment securities
available-for-sale, net of deferred income taxes		30		387		-92.2	%		103		-70.9	%
Total stockholders' equity		276,706		284,737		-2.8	%		276,033		0.2	%
Total liabilities and stockholders' equity	$	2,410,535	$	2,403,717		0.3	%	$	2,443,888		-1.4	%

9

CASCADE BANCORP (CACB)

Loan Portfolio & Reserve for Credit Losses

(Dollars in thousands)

(unaudited)

Loan portfolio	9/30/2008		% of gross loans			6/30/2008		% of gross loans			12/31/2007		% of gross loans
Commercial	$	608,714		30	%	$	616,121		30	%	$	606,408		29	%
Real Estate:
Construction/lot		595,938		29	%		649,846		31	%		686,829		33	%
Mortgage		94,380		5	%		89,540		4	%		88,509		4	%
Commercial		694,458		34	%		660,202		32	%		612,694		30	%
Consumer		56,311		3	%		50,382		2	%		47,038		2	%
Total loans		2,049,801		100	%		2,066,091		100	%		2,041,478		99	%
Less reserve for loan losses		43,721					36,873					33,875
Total loans, net	$	2,006,080				$	2,029,218				$	2,007,603

	Three months ended
	September 30,
	2008			2007
Reserve for loan losses:
Balance at beginning of period	$	36,873		$	24,597
Loan loss provision		15,024			1,750
Recoveries		269			288
Loans charged off		(8,445	)		(1,843	)
Balance at end of period	$	43,721		$	24,792
Reserve for unfunded commitments:
Balance at beginning of period	$	3,163		$	3,413
Provision (credit) for unfunded commitments		(2,124	)		(250	)
Balance at end of period	$	1,039		$	3,163
Reserve for credit losses:
Reserve for loan losses	$	43,721		$	24,792
Reserve for unfunded commitments		1,039			3,163
Total reserve for credit losses	$	44,760		$	27,955

10

CASCADE BANCORP (CACB)

Loan Breakdown by Region

(Dollars in thousands)

(unaudited)

Loan Breakdown by Region as of 9/30/08
Loan portfolio	Central Oregon		% of gross loans			Northwest Oregon		% of gross loans			Southern Oregon		% of gross loans			Idaho		% of gross loans			Bank total		% of gross loans
Commercial	$	192,600		27	%	$	191,700		43	%	$	53,800		21	%	$	167,400		27	%	$	605,500		30	%
Construction/lot		191,186		26	%		114,700		26	%		66,400		26	%		224,900		36	%		597,186		29	%
Mortgage		44,049		6	%		9,175		2	%		8,480		3	%		32,677		5	%		94,380		5	%
Commercial		266,300		37	%		127,400		28	%		119,600		47	%		176,700		28	%		690,000		34	%
Consumer		27,360		4	%		6,325		1	%		4,120		2	%		24,823		4	%		62,629		3	%
Total Loans	$	721,495		100	%	$	449,300		100	%	$	252,400		100	%	$	626,500		100	%	$	2,049,695		100	%

11

CASCADE BANCORP (CACB)

CONSTRUCTION/LOT BREAKDOWN BY REGION

(Dollars in thousands)

(unaudited)

	9/30/2008		% of category			% of Constr / lot portfolio			% of gross loans			12/31/2007
Residential Land Development:
Raw Land	$	96,354		35	%		15	%		5	%	$	107,160
Land Development		159,842		58	%		25	%		8	%		183,809
Speculative Lots		19,618		7	%		3	%		1	%		20,916
	$	275,814		100	%		42	%		13	%	$	311,885
Geographic distribution by region:
Central Oregon	$	96,609		35	%		15	%		5	%	$	107,150
Northwest Oregon		4,706		2	%		1	%		0	%		5,328
Southern Oregon		24,785		9	%		4	%		1	%		32,541
Total Oregon		126,101		46	%		19	%		6	%		145,019
Idaho		149,713		54	%		23	%		7	%		166,866
Grand total	$	275,814		100	%		42	%		13	%	$	311,885
Residential Construction:
Pre sold	$	59,906		53	%		9	%		3	%	$	64,714
Lots		18,023		16	%		3	%		1	%		20,575
Speculative Construction		35,036		31	%		5	%		2	%		58,048
	$	112,965		100	%		17	%		5	%	$	143,337
Geographic distribution by region:
Central Oregon	$	48,011		43	%		7	%		2	%	$	52,785
Northwest Oregon		28,499		25	%		4	%		1	%		31,652
Southern Oregon		8,137		7	%		1	%		0	%		14,252
Total Oregon		84,647		75	%		13	%		4	%		98,689
Idaho		28,318		25	%		4	%		1	%		44,648
Grand total	$	112,965		100	%		17	%		5	%	$	143,337
Commercial Construction:
Pre sold	$	30,102		14	%		5	%		1	%	$	61,298
Lots		14,218		7	%		2	%		1	%		17,525
Speculative		134,244		64	%		21	%		6	%		125,271
Speculative Lots		29,844		14	%		5	%		1	%		30,815
	$	208,407		100	%		32	%		10	%	$	234,909
Geographic distribution by region:
Central Oregon	$	46,665		22	%		7	%		2	%	$	68,411
Northwest Oregon		81,479		39	%		13	%		4	%		81,683
Southern Oregon		33,521		16	%		5	%		2	%		39,235
Total Oregon		161,665		78	%		25	%		8	%		189,329
Idaho		46,742		22	%		7	%		2	%		45,580
Grand total	$	208,407		100	%		32	%		10	%	$	234,909

12

CASCADE BANCORP (CACB)

Non-Performing Assets

(Dollars in thousands)

(unaudited)

Non-Performing Assets by Region as of 9/30/08
Region	9/30/2008		% of total NPAs			6/30/2008		% of total NPAs			3/31/2008		% of total NPAs			12/31/2007		% of total NPAs
Central Oregon	$	33,495		31	%	$	27,603		22	%	$	5,560		6	%	$	5,793		10	%
Northwest Oregon		1,518		1	%		17,513		14	%		17,542		18	%		1,615		3	%
Southern Oregon		27,024		25	%		26,190		21	%		28,822		30	%		22,876		41	%
Total Oregon	$	62,037		57	%	$	71,306		56	%	$	51,924		54	%	$	30,284		54	%
Idaho		47,035		43	%		55,799		44	%		44,116		46	%		25,397		46	%
Grand total	$	109,072		100	%	$	127,105		100	%	$	96,040		100	%	$	55,681		100	%

Non-Performing Assets by Loan Type as of 9/30/08
	$ Millions		% NPAs			% of Related Portfolio
Land Development		78,800		72.2	%		28.6	%
Res Construction		8,900		8.2	%		7.9	%
Commercial Construction		3,500		3.2	%		1.7	%
Commercial RE		12,700		11.6	%		1.8	%
C&I / Other		5,200		4.8	%		0.7	%
		109,100		100.0	%		5.3	%

Delinquent Loans as % of Related Portfolio
	30-59 days past due			>60 days past due			% of Related Portfolio
Land Development		0.25	%		1.42	%		1.67	%
Res Construction		0.26	%		0.00	%		0.26	%
Commercial Construction		0.00	%		0.00	%		0.00	%
Commercial RE		0.05	%		0.03	%		0.08	%
C&I		0.20	%		0.07	%		0.27	%
Consumer		0.24	%		0.03	%		0.27	%
Total loan portfolio		0.12	%		0.09	%		0.21	%

13

CASCADE BANCORP (CACB)

ADDITIONAL FINANCIAL INFORMATION

(Dollars in thousands)

(unaudited)

	Year over Year							Linked Quarter
	3rd Qtr		3rd Qtr		%			2nd Qtr		%
Three Months Ended:	2008		2007		Change			2008		Change
Average Assets	$	2,429,699	$	2,354,256		3.2	%	$	2,412,508		0.7	%
Average Loans		2,067,568		1,997,010		3.5	%		2,058,327		0.4	%
Average Deposits		1,650,637		1,802,099		-8.4	%		1,642,401		0.5	%
Average Investment Securities		87,148		101,244		-13.9	%		87,844		-0.8	%
Average Other Earning Assets		14,808		10,507		40.9	%		12,680		16.8	%
Average Non Interest Bearing Deposits		407,420		476,707		-14.5	%		414,130		-1.6	%
Average Customer Relationship Deposits		1,411,593		1,584,492		-10.9	%		1,642,401		-14.1	%
Average Earnings Assets		2,169,524		2,108,761		2.9	%		2,158,851		0.5	%
Average Interest Bearing Liabilities		1,715,196		1,567,474		9.4	%		1,695,171		1.2	%
Average Borrowings		471,979		242,082		95.0	%		466,901		1.1	%
Average Common Equity (book)		283,143		278,995		1.5	%		282,084		0.4	%
Average Common Equity (tangible)		169,544		163,816		3.5	%		168,093		0.9	%

	September 30,			September 30,			%			December 31,			%
Balances as of:	2008			2007			Change			2007			Change
Mortgage loans held for sale	$	2,002		$	1,748			14.5	%	$	4,306			-53.5	%
Intangibles & goodwill		113,363			114,944			-1.4	%		114,549			-1.0	%
Loans past due >90 days, not on non-accrual status		51			51						51			0.0	%
Loans on non-accrual status		88,017			21,046			318.2	%		45,865			91.9	%
Total non-performing loans (NPLs)		88,068			21,097			317.4	%		45,916			91.8	%
OREO - non performing		21,004			376			5486.2	%		9,765			115.1	%
Total non-performing assets	$	109,072		$	21,473			407.9	%	$	55,681			95.9	%
Operating commercial real estate OREO property		16,195			-			100.0	%		-			100.0	%
Total other real estate owned		37,199			376			9793.4	%		9,765			280.9	%
Selected ratios:
NPLs to total gross loans		4.30	%		1.03	%		315.8	%		2.25	%		91.0	%
NPAs to total gross loans and OREO		5.23	%		1.05	%		397.0	%		2.71	%		92.5	%
NPAs to total assets		4.52	%		0.89	%		406.5	%		2.33	%		94.6	%
Shares Outstanding (actual)		28,087			28,298			-0.7	%		28,034			0.2	%

14