Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by the registrant [X]
Filed by a party other than the registrant [ ]

Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12

KLAMATH FIRST BANCORP, INC.
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(Name of Registrant as Specified in Its Charter)

KLAMATH FIRST BANCORP, INC.
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(Name of Person(s) Filing Proxy Statement)

Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:
N/A
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(2) Aggregate number of securities to which transactions applies:
N/A
- ------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11:
N/A
- ------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
N/A
- ------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11 (a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.

(1) Amount previously paid:
N/A
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(2) Form, schedule or registration statement no.:
N/A
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(3) Filing party:
N/A
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(4) Date filed:
N/A
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[Klamath First Bancorp, Inc. Letterhead]

December 26, 2001

Dear Shareholder:

You are cordially invited to attend the Annual Meeting of Shareholders of
Klamath First Bancorp, Inc. ("Company"), the holding company for Klamath First
Federal Savings and Loan Association. The meeting will be held at the Shilo
Inn, 2500 Almond Street, Klamath Falls, Oregon, on Wednesday, January 30,
2002, at 2:00 p.m., Pacific Time.

The Notice of Annual Meeting of Shareholders and the Proxy Statement
appearing on the following pages describe the formal business to be transacted
at the meeting. During the meeting, we will also report on the operations of
the Company. Directors and officers of the Company, as well as a
representative of Deloitte & Touche LLP, the Company's independent auditors,
will be present to respond to any questions our shareholders may have.

It is important that your shares are represented at this meeting, whether
or not you attend the meeting in person and regardless of the number of shares
you own. To make sure your shares are represented, please sign, date and
return the enclosed proxy card. If you attend the meeting, you may vote in
person even if you have previously mailed a proxy card.

We look forward to seeing you at the meeting.

Sincerely,

/s/Kermit K. Houser
Kermit K. Houser
President and Chief Executive Officer

KLAMATH FIRST BANCORP, INC.
540 Main Street
Klamath Falls, Oregon 97601
(541) 882-3444

- ------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held On January 30, 2002
- ------------------------------------------------------------------------------

NOTICE IS HEREBY GIVEN THAT, the Annual Meeting of Shareholders
("Meeting") of Klamath First Bancorp, Inc. ("Company") will be held at the
Shilo Inn, 2500 Almond Street, Klamath Falls, Oregon, on Wednesday, January
30, 2002, at 2:00 p.m., Pacific Time.

The Meeting is for the purpose of considering and acting upon:

1. The election of three directors of the Company;

2. The approval of the appointment of Deloitte & Touche LLP as the
Company's independent auditors for the fiscal year ending September
30, 2002; and

3. Such other matters as may properly come before the Meeting or any
adjournments thereof.

NOTE: The Board of Directors is not aware of any other business to come
before the Meeting.

Any action may be taken on the foregoing proposals at the Meeting on the
date specified above or on any date or dates to which, by original or later
adjournment, the Meeting may be adjourned. Shareholders of record at the
close of business on November 30, 2001, are the shareholders entitled to
receive notice of and to vote at the Meeting and any adjournments thereof.

You are requested to fill in and sign the enclosed form of proxy, which
is solicited by the Board of Directors, and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend the Meeting and
vote in person.

BY ORDER OF THE BOARD OF DIRECTORS

/S/CRAIG M MOORE
CRAIG M MOORE
SECRETARY

Klamath Falls, Oregon
December 26, 2001
- ------------------------------------------------------------------------------
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES.
- ------------------------------------------------------------------------------

- ------------------------------------------------------------------------------
PROXY STATEMENT
OF
KLAMATH FIRST BANCORP, INC.
540 Main Street
Klamath Falls, Oregon 97601
(541) 882-3444

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ANNUAL MEETING OF SHAREHOLDERS
JANUARY 30, 2002
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This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Klamath First Bancorp, Inc. ("Company"),
the holding company for Klamath First Federal Savings and Loan Association
("Association"), to be used at the Annual Meeting of Shareholders of the
Company ("Meeting"). The Meeting will be held at the Shilo Inn, 2500 Almond
Street, Klamath Falls, Oregon, on Wednesday, January 30, 2002, at 2:00 p.m.,
Pacific Time. The accompanying Notice of Annual Meeting of Shareholders, this
Proxy Statement and the enclosed form of Proxy are being first mailed to
shareholders on or about December 26, 2001.

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VOTING AND PROXY PROCEDURE
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Shareholders Entitled to Vote at Meeting. Shareholders of record at the
close of business on November 30, 2001 ("Record Date") are entitled to one
vote for each share of common stock ("Common Stock") of the Company then held.
As of the close of business on the Record Date, the Company had 6,848,667
shares of Common Stock issued and outstanding.

As provided in the Company's Articles of Incorporation, record holders of
the Company's Common Stock who beneficially own, either directly or
indirectly, in excess of 10% of the Company's outstanding shares are not
entitled to any vote in respect of the shares held in excess of the 10% limit.

If you are a beneficial owner of Company Common Stock held by a broker,
bank or other nominee (i.e., in "street name"), you will need proof of
ownership to be admitted to the Meeting. A recent brokerage statement or
letter from a bank or broker are examples of proof of ownership. If you want
to vote your shares of Company Common Stock held in street name in person at
the Meeting, you will have to get a written proxy in your name from the
broker, bank or other nominee who holds your shares.

Quorum Requirement. The presence, in person or by proxy, of at least a
majority of the total number of outstanding shares of Common Stock entitled to
vote is necessary to constitute a quorum at the Meeting. Abstentions will be
counted as shares present and entitled to vote at the Meeting for purposes of
determining the existence of a quorum. Broker non-votes will not be
considered shares present and will not be included in determining whether a
quorum is present.

Proxies; Proxy Revocation Procedures. The Board of Directors solicits
proxies so that each shareholder has the opportunity to vote on the proposals
to be considered at the Meeting. When a proxy card is returned properly
signed and dated, the shares represented thereby will be voted in accordance
with the instructions on the proxy card. Where a proxy card is properly
signed but no instructions are indicated, proxies will be voted FOR the
nominees for directors set forth below and FOR the approval of the appointment
of Deloitte & Touche LLP as independent auditors. If a shareholder attends
the Meeting, he or she may vote by ballot. The Board recommends a vote FOR
the election of the nominees for director and FOR the appointment of Deloitte
and Touche LLP as the Company's independent auditors for the fiscal year
ending September 30, 2002.

Shareholders who execute proxies retain the right to revoke them at any
time. Proxies may be revoked by written notice delivered in person or mailed
to the Secretary of the Company or by filing a later dated proxy before a

vote being taken on a particular proposal at the Meeting. Attendance at the
Meeting will not automatically revoke a proxy, but a shareholder in attendance
may request a ballot and vote in person, thereby revoking a prior granted
proxy.

If your Company Common Stock is held in street name, you will receive
instructions from your broker, bank or other nominee that you must follow in
order to have your shares voted. If you wish to change your voting
instructions after you have returned your voting instruction form to your
broker or bank, you must contact your broker or bank.

Participants in the Klamath First Federal Savings and Loan Association
ESOP. If a shareholder is a participant in the Klamath First Federal Savings
and Loan Association Employee Stock Ownership Plan ("ESOP"), the proxy card
represents a voting instruction to the trustees of the ESOP as to the number
of shares in the participant's plan account. Each participant in the ESOP may
direct the trustees as to the manner in which shares of Common Stock allocated
to the participant's plan account are to be voted. The instructions are
confidential and will not be disclosed to the Company. Unallocated shares of
Common Stock held by the ESOP, and allocated shares for which no voting
instructions are received from participants, will be voted by the trustees in
the same proportion as shares for which the trustees have received voting
instructions.

Vote Required. The three directors to be elected at the Meeting will be
elected by a plurality of the votes cast by shareholders present in person or
by proxy and entitled to vote. Shareholders are not permitted to cumulate
their votes for the election of directors. Votes may be cast for or withheld
from each nominee for election as directors. Votes that are withheld and
broker non-votes will have no effect on the outcome of the election because
directors will be elected by a plurality of votes cast.

The approval of the appointment of Deloitte & Touche LLP as the Company's
independent auditors for the fiscal year ending September 30, 2002 requires
the affirmative vote of a majority of the outstanding shares of the Company's
Common Stock present in person or by proxy and entitled to vote at the
Meeting. Abstentions are not affirmative votes and, therefore, will have the
same effect as a vote against the proposal and broker non-votes will be
disregarded and will have no effect on the outcome of the vote.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
- ------------------------------------------------------------------------------

Persons and groups who beneficially own in excess of 5% of the
outstanding shares of the Company's Common Stock are required to file certain
reports with the Securities and Exchange Commission ("SEC"), and provide a
copy to the Company, disclosing such ownership pursuant to the Securities
Exchange Act of 1934, as amended ("Exchange Act"). Based solely upon the
receipt of such reports, other than as set forth in the following table,
management knows of no person who owned more than 5% of the outstanding shares
of Common Stock as of the Record Date. In addition, the following table sets
forth, as of the Record Date, information as to the shares of the Common Stock
beneficially owned by each director and named executive officer and by all
executive officers and directors of the Company as a group.

Number of
Shares Percent of
Beneficially Shares
Name Owned (1) Outstanding
- ---- --------- -----------

Beneficial owners of more than 5%

Klamath First Federal Savings and Loan 391,351 5.71%
Association Employee Stock Ownership Plan (2)
540 Main Street
Klamath Falls, Oregon 97601

Number of
Shares Percent of
Beneficially Shares
Name Owned (1) Outstanding
- ---- --------- -----------

Dimensional Fund Advisors, Inc.(3) 576,500 7.88
1299 Ocean Avenue
11th Floor
Santa Monica, California 90401

Thomson Hortsmann & Bryant, Inc. (4) 506,500 6.91
Park 80 West, Plaza One
Saddle Brook, New Jersey 07663

High Rock Capital LLC (5) 387,100 5.30
High Rock Asset Management LLC
28 State Street, 18th Floor
Boston, Massachusetts 02109

Baupost Group LLC (6) 611,000 8.35
44 Brattle Street, 5th Floor
Cambridge, Massachusetts 02139

Friedman Billings Ramsey Group, Inc. (7) 365,000 5.60
1001 19th Street North
Arlington, Virginia 22209

Directors and Certain Executive Officers(8)

Rodney N. Murray, Chairman of the Board 94,129(9) 1.37
Kermit K. Houser, President and
Chief Executive Officer 70,200(10) 1.03
Bernard Z. Agrons 70,447(11) 1.03
J. Gillis Hannigan 67,370(12) *
Dianne E. Spires 24,760(13) *
Timothy A. Bailey 70,348(14) 1.03
James D. Bocchi 78,616(15) 1.15
William C. Dalton 56,570(16) *
Robert A. Tucker, former Executive
Vice President, Secretary,
and Chief Credit Officer 216,671(17) 3.16
Frank X. Hernandez 38,317(18) *
Marshall J. Alexander 164,535(19) 2.40
Craig M Moore 7,892(20) *
All Executive Officers and
Directors as a Group (12 persons) 959,855(21) 14.02
- ---------------
* Less than 1% of shares outstanding.
(1) In accordance with Rule 13d-3 under the Exchange Act, a person is deemed
to be the beneficial owner, for purposes of this table, of any shares of
Common Stock if he has voting and/or investment power with respect
to such security or has a right to acquire, through the exercise of
outstanding options or otherwise, beneficial ownership at any time within
60 days from the Record Date. The table includes shares owned by
spouses, other immediate family members in trust, shares held in
retirement accounts or funds for the benefit of the

named individuals, and other forms of ownership, over which shares the
persons named in the table possess voting and/or investment power.
(2) Under the terms of the ESOP, the trustees will vote unallocated shares
and allocated shares for which no voting instructions are received in the
same proportion as shares for which the trustees have received voting
instructions from participants. As of the Record Date, 587,299 shares
have been allocated to participants' accounts. The trustees of the ESOP
are Bernard Z. Agrons, Timothy A. Bailey, and J. Gillis Hannigan.
(3) Based on a Schedule 13G, dated February 2, 2001, filed with the SEC.
According to this filing Dimensional Fund Advisor, Inc., an investment
adviser registered under the Investment Advisers Act of 1940, has sole
voting power and sole dispositive power with respect to these shares.
(4) Based on a Schedule 13G, dated February 7, 2001. According to this
filing, Thomson Horstmann & Bryant Inc., an investment adviser registered
under the Investment Advisers Act of 1940, has sole voting power with
respect to 282,100 shares and sole dispositive power with respect to
506,500 shares.
(5) Based on a Schedule 13G dated February 14, 2001. According to this
filing, High Rock Capital LLC, an investment adviser registered under the
Investment Advisers Act of 1940, has sole voting power with respect
to 305,100 shares and sole dispositive power with respect to 386,100
shares and High Rock Asset Management LLC, an investment adviser
registered under the Investment Advisers Act of 1940, has sole voting
power and sole dispositive power with respect to 1,000 shares.
(6) Based on an amended Schedule 13G dated February 14, 2001. According to
this filing, Baupost Group, LLC, an investment adviser registered under
the Investment Advisers Act of 1940, has sole voting and sole
dispositive power with respect to these shares.
(7) Based on a Schedule 13G dated July 16, 2001. According to this filing,
Friedman Billings Ramsey, Inc., a parent holding company or control
person, has sole voting power and sole dispositive power with respect to
these shares.
(8) Under SEC regulations, the term "named executive officer(s)" is defined
to include the chief executive officer, regardless of compensation level,
and the four most highly compensated executive officers, other than the
chief executive officer, whose total annual salary and bonus for the last
completed fiscal year exceeded $100,000. Messrs. Kermit K. Houser, Frank
X. Hernandez, Marshall J. Alexander and Robert A. Tucker were the
Company's only "named executive officers" for the fiscal year ended
September 30, 2001.
(9) Includes 61,167 shares underlying stock options exercisable within 60
days of the Record Date. Includes unvested restricted shares issued
under the Company's Management Recognition and Development Plan
("MRDP"). Participants in the MRDP exercise all rights incidental to
ownership, including voting rights.
(10) Mr. Kermit K. Houser was appointed by the Company as President and Chief
Executive Officer, effective November 15, 2000. Includes 50,000 shares
underlying stock options exercisable within 60 days of the Record
Date.
(11) Includes 45,670 shares underlying stock options exercisable within 60
days of the Record Date.
(12) Includes 45,670 shares underlying stock options exercisable within 60
days of the Record Date.
(13) Includes 18,594 shares underlying stock options exercisable within 60
days of the Record Date. Includes unvested shares in the Company's MRDP.
Participants in the MRDP exercise all rights incidental to ownership,
including voting rights.
(14) Includes 45,670 shares underlying stock options exercisable within 60
days of the Record Date.
(15) Includes 45,670 shares underlying stock options exercisable within 60
days of the Record Date.
(16) Includes 45,670 shares underlying stock options exercisable within 60
days of the Record Date.
(17) Includes 156,584 shares underlying stock options exercisable within 60
days of the Record Date. Mr. Tucker retired from the Company effective
October 5, 2001.
(18) Includes 9,786 shares underlying stock options exercisable within 60 days
of the Record Date. Includes unvested shares in the Company's MRDP.
Participants in the MRDP exercise all rights incidental to ownership,
including voting rights.
(19) Includes 107,651 shares underlying stock options exercisable within 60
days of the Record Date. Includes unvested shares in the Company's MRDP.
Participants in the MRDP exercise all rights incidental to ownership,
including voting rights.

(20) Mr. Moore was appointed Corporate Secretary effective January 26, 2001.
Includes unvested shares in the Company's MRDP. Participants in the MRDP
exercise all rights incidental to ownership, including voting rights.
(21) Includes 632,132 shares underlying stock options exercisable within 60
days of the Record Date.

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PROPOSAL I - ELECTION OF DIRECTORS
- ------------------------------------------------------------------------------

The Company's Board of Directors consists of eight directors as required
by the Company's Bylaws. The Company's Bylaws also provide that directors
will be elected for three-year staggered terms with approximately one-third of
the directors elected each year.

The nominees for election this year are Kermit K. Houser, J. Gillis
Hannigan and Dianne E. Spires, all of whom are current members of the Board of
Directors. Each of these directors has been nominated to serve for a
three-year term.

It is intended that the proxies solicited by the Board of Directors will
be voted for the election of the above named nominees for the terms specified
in the table below. If the nominees are unable to serve, the shares
represented by all valid proxies will be voted for the election of such
substitute as the Board of Directors may recommend. At this time the Board of
Directors knows of no reason why any of the nominees might be unavailable to
serve.

The Board of Directors recommends a vote "FOR" the election of Messrs.
Houser and Hannigan and Ms. Spires.

The following table sets forth certain information regarding the nominees
for election at the Meeting and the directors continuing in office after the
Meeting.
Year First
Elected or
Principal Occupation Appointed Term to
Name Age(1) During Last Five Years Director(2) Expire
---- ------ ---------------------- ----------- ------

BOARD NOMINEES

Kermit K. Houser 58 President and Chief Executive 2000 2005(3)
Officer of the Company and the
Association since November 2000.
Prior to joining the Company,
employed in various capacities
by Bank of America from 1983 to
2000, as senior vice president
and manager for commercial
banking; executive vice president
and senior credit officer; and
most recently, senior vice presi-
dent and market executive for
Bank of America's South Valley
commercial banking, in Fresno,
California.

J. Gillis
Hannigan 72 Retired; Former Executive Vice 1987 2005(3)
President of Modoc Lumber,
Klamath Falls, Oregon; former
Vice President of DiGiorgio
Corporation in San Francisco,
California.

Dianne E. Spires 47 Certified Public Accountant; 1997 2005(3)
Partner in Rusth, Spires &
Menefee, LLP, Klamath Falls,
Oregon.

DIRECTORS CONTINUING IN OFFICE

Year First
Elected or
Principal Occupation Appointed Term to
Name Age(1) During Last Five Years Director(2) Expire
---- ------ ---------------------- ----------- ------

Rodney N. Murray 73 Owner and operator of Rod 1976 2004
Murray Ranch, Klamath Falls,
Oregon; former owner and
operator of Klamath Falls
Creamery/Crater Lake Dairy
Products.

Bernard Z. Agrons 79 Retired; Weyerhaeuser Company 1974 2004
Vice President for the
Eastern Oregon Region until
1981. Former State Representa-
tive in the Oregon State Legis-
lature from 1983 to 1991.

Timothy A. Bailey 55 Executive director of KMSB 1993 2003
Foundation; Member of Oregon
State Bar; Former Senior Vice
President - Klamath Operations
for Regence Blue Cross/Blue
Shield of Oregon.

James D. Bocchi 77 Retired; President and Chief 1983 2003
Executive Officer of the
Association from 1984 to 1994;
employed by Association from
1950 to 1994.

William C. Dalton 70 Retired, former owner of W.C. 1972 2003
Dalton Company, farming.

- ---------------
(1) As of September 30, 2001.
(2) Includes service on the Board of Directors of the Association.
(3) Assuming election or re-election at the Meeting.

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MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
- ------------------------------------------------------------------------------

The Boards of Directors of the Company and the Association conduct their
business through meetings of the Boards and through their committees. During
the fiscal year ended September 30, 2001, the Board of Directors of the
Company held 12 regular meetings and no special meetings and the Board of
Directors of the Association held 12 regular meetings and six special
meetings. No director of the Company or the Association attended fewer than
75% of the total meetings of the Boards and committees on which such person
served during this period.

The Boards of Directors of the Company and the Association have
established various committees, including Executive, Audit, Compensation and
Nominating Committees.

The Executive Committee consists of Messrs. Bocchi, Dalton, Hannigan and
Murray. The Executive Committee has the power and authority to act on behalf
of the Board of Directors on matters between regularly

scheduled Board meetings unless specific Board of Directors' action is
otherwise required. The Executive Committees of the Company and of the
Association met twice during the year ended September 30, 2001.

The Audit Committee consists of Messrs. Agrons, Dalton and Murray and Ms.
Spires. The Audit Committee reviews the internal auditors' reports and
results of their examination prior to review by and with the entire Board of
Directors and retains and establishes the scope of engagement of the Company's
independent auditors. The Audit Committee met five times during the year
ended September 30, 2001. For additional information regarding the Audit
Committee, see "Audit Committee Matters" below.

The Compensation Committee, consisting of Messrs. Hannigan, Agrons and
Bailey, reviews and recommends compensation arrangements for management and
other personnel. The Compensation Committee met four times during the year
ended September 30, 2001.

The Nominating Committee, consisting of the Company's full Board of
Directors, selects the nominees for election as directors. The Nominating
Committee met once to nominate the nominees for directors at the Meeting and
three times to discuss the size and composition of the Board of Directors.
The Nominating Committee intends to increase the size of the Board of
Directors to better reflect the expansion of the Company's market area.

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DIRECTORS' COMPENSATION
- ------------------------------------------------------------------------------

The Company and the Association each pay fees to its directors, and each
director of the Company is a director of the Association. Each director of
the Company receives a quarterly fee of $1,000, except that the Chairman of
the Board receives a quarterly fee of $1,250. Each director of the
Association other than the Chairman of the Board receives an annual retainer
of $10,900 and a fee of $1,550 per month for attendance at regular Board
meetings. In addition to the annual retainer, the Chairman of the Board of
the Association also receives a fee of $1,950 per month for attendance at
regular Board meetings. Mr. Houser, President, Chief Executive Officer and a
director of the Company and the Association, does not receive any fees for
attending Board meetings of the Company and the Association. The Company and
the Association paid total fees to directors of $236,550 for the fiscal year
ended September 30, 2001, and $16,800 was paid to one director emeritus.

The Association also maintains an unfunded supplemental benefit plan to
provide retirement benefits to members of the Board of Directors. Payments
are based on directors' fees paid by the Association and continue for a period
of five years following a director's retirement, except for directors who
served at January 1, 1992, who receive this fee for life.

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EXECUTIVE COMPENSATION
- ------------------------------------------------------------------------------

Summary Compensation Table. The following table shows the compensation
paid during the last three fiscal years to the Company's Chief Executive
Officer and the three highest paid executive officers of the Company who
received salary and incentive compensation in excess of $100,000 during the
fiscal year ended September 30, 2001.

Long-Term
Compensation
Annual Compensation(1) Awards
-------------------------------- ------------
Restricted
Stock All Other
Name and Position Year Salary($) Bonus($) Awards($)(3) Compensation($)(4)
- ----------------- ---- --------- -------- ------------ ------------------
<s> <c> <c> <c> <c> <c>
Kermit K. Houser (2) 2001 $175,000 $ -- $232,500 $ --
President and Chief
Executive Officer
and Director

Marshall J. Alexander 2001 $104,220 $ -- $147,481 $ 34,132
Executive Vice President 2000 89,352 1,789 -- 32,435
and Chief Financial 1999 80,892 4,235 -- 37,913
Officer

Frank X. Hernandez 2001 $103,980 $ -- $130,630 $ 28,616
Senior Vice President 2000 94,542 1,891 -- 21,306
and Chief Operating 1999 74,502 3,750 -- 21,916
Officer

Robert A. Tucker(5) 2001 $114,600 $ -- $147,481 $229,559
former Executive Vice 2000 109,164 2,183 -- 32,435
President, Secretary and 1999 98,964 5,084 -- 37,913
Chief Credit Officer

- --------------
(1) All compensation is paid by the Association. Excludes certain additional
benefits which did not exceed the lesser of $50,000 or 10% of salary and
bonus.
(2) Mr. Houser was appointed to his position effective November 15, 2000.
(3) Represents the total value of the award of 20,000 shares of restricted
Common Stock to Mr. Houser, on November 15, 2000, the award date,
pursuant to the MRDP. Represents the total value of the award of
restricted Common Stock to Messrs. Alexander, Hernandez, and Tucker, on
April 1, 2001, the award date, pursuant to the MRDP. The restricted MRDP
shares vest ratably over a two-year period, except for those awarded to
Mr. Hernandez, which vest ratably over a five-year period. At September
30, 2001, the value of the unvested restricted stock awards were: Mr.
Houser, $273,000; Mr. Alexander, $154,109; Mr. Hernandez, $136,500; and
Mr. Tucker, $154,109. Because the unrestricted shares were not vested at
the time of Mr. Tucker's retirement from the Company on October 5, 2001,
Mr. Tucker forfeited the award of restricted shares.
(4) For Messrs. Houser, Alexander, Hernandez and Tucker, represents the cost
to the Company of awards under the ESOP. For Mr. Tucker, represents
$34,132 in cost to the Company of allocations under the ESOP and
lump sum payments of $100,000 and $95,427 to Mr. Tucker for severance
compensation and early retirement benefits, respectively.
(5) Mr. Tucker retired from the Company effective October 5, 2001. Mr. Ben
A. Gay was appointed to replace Mr. Tucker effective October 5, 2001.

Option Grants in Last Fiscal Year. The Company maintains the Klamath
First Bancorp, Inc. 1996 Stock Option Plan ("Option Plan"), which provides
discretionary awards of options to purchase Common Stock to officers,
directors and employees as determined by the Board of Directors. The Option
Plan was approved by stockholders at the 1996 Annual Meeting of Stockholders.
The following table lists all grants of options under the Option Plan to any
named executive officers for the year ended September 30, 2001 and contains
certain information about the potential value of the options based upon
certain assumptions as to the appreciation of the Company's Common Stock over
the life of the option.

Potential Realizable
Value at Assumed
Number of Percent of Annual Rates of
Securities Total Options Stock Price Appreciation
Underlying Granted to for Option Term(2)
Options Employees in Exercise Expiration ------------------------
Name Granted (1) Fiscal Year Price Date 5%($) 10%($)
- ---- ----------- ----------- ----- ----- ----- ------
<s> <c> <c> <c> <c> <c> <c>

Kermit K. Houser 100,000 39.6% $11.625 11/15/10 $1,893,590 $3,015,226
Frank X. Hernandez 20,000 7.9% $13.063 4/1/11 $ 425,565 $ 677,641
Marshall J. Alexander 20,000 7.9% $13.063 4/1/11 $ 425,565 $ 677,641
Robert A. Tucker 20,000 7.9% $13.063 4/1/11 $ 425,565 $ 677,641

(footnotes on following page)

- -----------
(1) Each option grant reported in the table vests at the rate of 50% per
annum except for those granted to Mr. Hernandez, which vest at the rate
of 20% per annum. Options will become immediately exercisable in the
event of a change in control of the Company.
(2) The dollar gains under these columns result from calculations required by
the SEC's rules and are not intended to forecast future price
appreciation of the Common Stock of the Company. It is important to note
that options have value to the listed executive only if the stock price
increases above the exercise price shown in the table during the
effective option period. In order for the listed executives to realize
the potential values set forth in the 5% and 10% columns in the table,
the price per share of the Company's Common Stock would be approximately
$18.936 and $30.152, respectively, as of the expiration of the options
granted on November 15, 2000 and $21.278 and $33.882, respectively, as of
the expiration of the options granted on April 1, 2001.
(3) Because the options were unvested at the time of his retirement from the
Company on October 5, 2001, Mr. Tucker forfeited his award of options.

Option Exercise/Value Table. The following information is provided for Messrs. Houser, Alexander,
Hernandez and Tucker. Mr. Tucker retired from the Company effective October 5, 2001.

Number of Dollar Value of
Number of Unexercised Options In-the-Money Options
Shares Dollar at Fiscal Year End(#) at Fiscal Year End($)(1)
Acquired on Value -------------------------- --------------------------
Name Exercise(#) Realized($) Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ----------- ----------- ------------- ----------- -------------
<s> <c> <c> <c> <c> <c> <c>

Kermit K. Houser -- $ -- -- 100,000 $ -- $202,500
Marshall J. Alexander -- $ -- 107,651 20,000 $ 56,517 $ 11,740
Frank X. Hernandez -- $ -- 9,786 20,000 $ 5,138 $ 11,740
Robert A. Tucker -- $ -- 156,584(2) 20,000(3) $ 82,207 $ 11,740

- ----------
(1) Value of unexercised in-the-money options equals market value of shares
covered by in-the-money options on September 30, 2001 less the option
exercise price. Options are in-the-money if the market value of the
shares covered by the options is greater than the option exercise price.
(2) Mr. Tucker's options are fully exercisable through April 9, 2006.
(3) Because these options were unvested at the time of his retirement from
the Company on October 5, 2001, Mr. Tucker forfeited his awards of
options.

Employment Agreements. The Company and the Association (collectively,
"Employers") have entered into two-year employment agreements ("Employment
Agreements") with Mr. Houser, Mr. Hernandez, and Mr. Alexander (individually,
the "Executive," collectively, "the Executives").

Under the Employment Agreements, the current annual salary level for
Messrs. Houser, Hernandez and Alexander is $200,000, $103,980, and $114,600,
respectively, which amounts will be paid by the Association and which may be
increased at the discretion of the Board of Directors or an authorized
committee of the Board. On each anniversary of the commencement date of the
Employment Agreements, the term of each agreement may be extended for an
additional year at the discretion of the Board of Directors. The current term
for Mr. Houser's Employment Agreement expires on November 15, 2003 and the
current terms for Mr. Hernandez's and Mr. Alexander's Employment Agreements
expire October 1, 2003. The Employment Agreements are terminable by the
Employers for just cause at any time or upon the occurrence of certain events
specified by federal regulations. Under the Employment Agreements, the
Executives may receive bonuses at the discretion of the Board.

The Employment Agreements provide for severance payments and other
benefits in the event of involuntary termination of employment in connection
with any change in control of the Employers. Severance payments also will be
provided on a similar basis in connection with a voluntary termination of
employment where, subsequent to a change in control, the Executives are
assigned duties inconsistent with their respective position, duties,
responsibilities and status immediately prior to such change in control. The
term "change in control" is defined in the Employment Agreements as, among
other things, any time during the period of employment when (a) a person other
than the

Company purchases shares of Common Stock pursuant to a tender or exchange
offer for such shares, (b) any person (as such term is used in Sections 13(d)
and 14(d)(2) of the Exchange Act) is or becomes the beneficial owner, directly
or indirectly, of securities of the Company representing 25% or more of the
combined voting power of the Company's then outstanding securities, (c) the
membership of the Board of Directors changes as the result of a contested
election, or (d) shareholders of the Company approve a merger, consolidation,
sale or disposition of all or substantially all of the Company's assets, or a
plan of partial or complete liquidation.

The maximum value of the severance benefits under the Employment
Agreements is 2.99 times the Executive's average annual compensation during
the five-year period preceding the effective date of the change in control
(the "base amount"). Such amounts will be paid in a lump sum within ten
business days following the termination of employment. Had a change in
control of the Employers occurred in 2001, Messrs. Houser, Hernandez and
Alexander would have been entitled to a severance payment of approximately
$598,000, $310,900 and $342,654, respectively. Section 280G of the Internal
Revenue Code of 1986, as amended ("Code"), provides that certain severance
payments which equal or exceed three times the base compensation of the
individual are deemed to be "excess parachute payments" if they are contingent
upon a change in control. Individuals receiving excess parachute payments are
subject to a 20% excise tax on the amount of such excess payments, and the
Employers would not be entitled to deduct the amount of such excess payments.

The Employment Agreements restrict the Executive's right to compete
against the Employers for a period of one year from the date of termination of
the agreement if the Executive voluntarily terminates employment, except in
the event of a change in control.

The Employers had entered into an employment agreement with Mr. Tucker on
substantially similar terms to those of Messrs. Hernandez and Alexander. Mr.
Tucker's employment agreement was terminated upon his resignation. In
connection with his resignation, the Boards of Directors of the Employers
authorized severance compensation payable to Mr. Tucker in a lump sum payment
of $100,000 on October 5, 2001, which payment was subject to all applicable
federal and state withholding obligations. As a condition of payment, Mr.
Tucker has agreed not to compete with the Employers for a period of one year.

Retirement Plan. The Association has participated in the Financial
Institutions Retirement Fund ("FIRF"), a defined benefit retirement plan. On
September 7, 2001, the Association provided notice to all plan participants
that the defined benefit plan would be terminated, with no additional accrual
of benefits under the plan after September 30, 2001. This action was taken
for numerous reasons, including the following: to provide greater certainty of
and to reduce pension costs, to encourage employee planning for retirement,
and to permit greater portability in connection with a more mobile work force.

All employees working at least 1,000 hours per year were eligible to
participate in the FIRF after completion of one year of service to the
Association. Benefits were based upon years of service and salary excluding
bonuses, fees, commissions, etc. Participants were fully vested in their
accrued benefit after five years of service. At September 30, 2001, Messrs.
Tucker, Alexander and Hernandez had 27,14 and 8 years of credited service
under the FIRF, respectively.

Under the plan, the normal retirement age was 65 and the early retirement
age was before age 65, but at least age 45. Normal retirement benefits were
equal to 1.5% multiplied by the years of benefit service to the Association
and by the employee's average base salary for the five highest consecutive
years preceding retirement up to the covered compensation level. An employee
could also elect early retirement in which case the retirement benefit payable
at age 65 would equal the vested amount of the employee's normal retirement
benefit accrued through the employee's last day of employment. However, if
payments commenced prior to age 65, the benefit was reduced proportionately
based on the employee's age. Payment would also be deferred to any time up to
age 70, in which case the retirement allowance payable at age 65 would be
increased by .8% for each month of deferment after age 65 (to a maximum
increase of 48%). The Association's contributions were determined actuarially
in an amount necessary to fund the accrued and anticipated benefits. Upon
retirement, the regular form of benefit under the FIRF was an annuity payable
in equal monthly installments for the life of the employee. Optional annuity
benefit forms or a lump sum distribution could also be elected by the
employee. Benefits were not reduced by a participant's social security
benefits.

The following table indicates the annual retirement benefits that would
have been payable under the FIRF upon retirement at age 65 to a participant
electing to receive his or her retirement benefits in the standard form of
benefits, assuming various specified levels of the FIRF compensation and
various specified years of credited service. Under the Code, maximum annual
benefits under the FIRF are limited to $140,000 per year for the 2001 calendar
year.

Highest Five Years of Service
Year Annual -----------------------------------------------------------
Compensation 15 20 25 30 35
------------ -----------------------------------------------------------

$ 10,000 $ 2,250 $ 3,000 $ 3,750 $ 4,500 $ 5,250
$ 20,000 4,500 6,000 7,500 9,000 10,500
$ 30,000 6,750 9,000 11,250 13,500 15,750
$ 40,000 9,000 12,000 15,000 18,000 21,000
$ 50,000 11,250 15,000 18,750 22,500 26,250
$ 60,000 13,500 18,000 22,000 27,000 31,500
$ 70,000 15,750 21,000 26,250 31,500 36,750
$ 80,000 18,000 24,000 30,000 36,000 42,000
$ 90,000 20,250 27,000 33,750 40,500 47,250
$ 100,000 22,500 30,000 37,500 45,000 52,500
$ 110,000 24,750 33,000 41,250 49,500 57,750

Beginning October 1, 2001, the Association adopted a 401(k) defined
contribution plan, which permits eligible employees to defer salary on a
pre-tax basis, with the Association matching 50% of the employee deferral up
to a total 3% matching contribution. For example, an employee's deferral of
6% wages would result in the maximum matching contribution of 3% of wages. In
addition, the 401(k) provides for an annual discretionary profit sharing
contribution for all employees. Employee contributions vest immediately, with
the employer matching contribution vesting equally over five years. Service
prior to adoption of the 401(k) was counted toward vesting of employer
matching contributions.

In connection with termination of the defined benefit plan and adoption
of the 401(k) defined contribution plan, enhanced early retirement benefits
were made available to employees who would have at least 20 years of service
with the Association and who elected to retire prior to December 31, 2001. Mr
Tucker was the only named executive among this group of employees. Employees
accepting the early retirement benefits were paid a lump sum representing the
present value of the difference between their retirement benefits under the
defined benefit plan at termination and the greater of what the benefits would
have been if five years had been added to their age or service. Mr. Tucker
received a gross lump sum payment of $95,427 on October 5, 2001 for accepting
this benefit, namely, the greater of what the benefits would have been if five
years had been added to his age or service. The payment was subject to
federal and state withholding obligations.

- ------------------------------------------------------------------------------
AUDIT COMMITTEE MATTERS
- ------------------------------------------------------------------------------

Audit Committee Charter. The Audit Committee operates pursuant to a
Charter approved by the Company's Board of Directors. The Audit Committee
reports to the Board of Directors and is responsible for overseeing and
monitoring financial accounting and reporting, the system of internal controls
established by management and the audit process of the Company. The Audit
Committee Charter sets out the responsibilities, authority and specific duties
of the Audit Committee. The Charter specifies, among other things, the
structure and membership requirements of the Audit Committee, as well as the
relationship of the Audit Committee to the independent accountants, the
internal audit department, and management of the Company.

A copy of the Audit Committee Charter was filed as Appendix A to the
Company's Annual Meeting Proxy Statement for the 2001 Annual Meeting of
Stockholders.

Report of the Audit Committee. The Audit Committee reports as follows
with respect to the Company's audited financial statements for the year ended
September 30, 2001:

- The Audit Committee has completed its review and discussion of the
Company's 2001 audited financial statements with management;

- The Audit Committee has discussed with the independent auditors
(Deloitte & Touche LLP) the matters required to be discussed by
Statement on Auditing Standards ("SAS") No. 61, Communication with
Audit Committees, as amended by SAS No. 90, Audit Committee
Communications, including, matters related to the conduct of the
audit of the Company's financial statements;

- The Audit Committee has received written disclosures, as required by
Independence Standards Board Standard No. 1, Independence Discussions
with Audit Committee, indicating all relationships, if any, between
the independent auditor and its related entities and the Company and
its related entities which, in the auditor's professional judgment,
reasonably may be thought to bear on the auditors independence, and
the letter from the independent auditors confirming that, in its
professional judgment, it is independent from the Company and its
related entities, and has discussed with the auditors the auditors'
independence from the Company; and

- The Audit Committee has, based on its review and discussions with
management of the Company's 2001 audited financial statements and
discussions with the independent auditors, recommended to the
Board of Directors that the Company's audited financial statements
for the year ended September 30, 2001 be included in the Company's
Annual Report on Form 10-K.

Audit Committee consisting of: Bernard Z. Agrons, Chairman
William C. Dalton
Rodney N. Murray
Dianne E. Spires

Independence and Other Matters. Each member of the Audit Committee is
"independent," as defined, in the case of the Company, under the Nasdaq Stock
Market Rules. The Audit Committee members do not have any relationship to the
Company that may interfere with the exercise of their independence from
management and the Company. None of the Audit Committee members are current
officers or employees of the Company or its affiliates.

- ------------------------------------------------------------------------------
COMPENSATION COMMITTEE MATTERS
- ------------------------------------------------------------------------------

Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or
the Exchange Act that might incorporate future filings, including this Proxy
Statement, in whole or in part, the following Report of the Compensation
Committee and Performance Graph shall not be incorporated by reference into
any such filings.

Report of the Compensation Committee. Under rules established by the
SEC, the Company is required to provide certain data and information in regard
to the compensation and benefits provided to the Company's Chief Executive
Officer and other executive officers of the Company and the Association. The
disclosure requirements for the Chief Executive officer and other executive
officers include the use of tables and a report explaining the rationale and
considerations that led to the fundamental executive compensation decisions
affecting those individuals. Insofar as no separate compensation is currently
payable by the company, the Compensation Committee of the Association (the
"Committee"), at the direction of the Board of Directors of the Company, has
prepared the following report for inclusion in this proxy statement.

The Compensation Committee's duties are to recommend and administer
policies that govern executive compensation for the Company and the
Association. The Compensation Committee evaluates executive performance,
compensation policies and salaries and makes recommendations to the Board of
Directors concerning the compensation of each named executive officer and
other executive officers. The Board of Directors reviews the Compensation
Committee's recommendations and establishes compensation levels for the coming
year.

The executive compensation policy of the Company and the Association is
designed to establish an appropriate relationship between executive pay and
the Company's and the Association's annual and long-term performance,
long-term growth objectives, and their ability to attract and retain qualified
executive officers. The principles underlying the program are:

- To attract and retain key executives who are vital to the long-term
success of the Company and the Association and who are of the
highest caliber;

- To provide compensation levels competitive with those offered
throughout the financial industry and consistent with the company's
and the Association's level of performance; and

- To motivate executives to enhance long-term shareholder value by
building their personal ownership in the Company; and

- To integrate the compensation program with the Company's and the
Association's annual and long-term strategic planning and
performance measurement processes.

The Compensation Committee also considers a variety of subjective and
objective factors in determining the compensation package for individual
executives, including (i) the performance of the Company and the Association
as a whole with emphasis on annual and long-term performance, (ii) the
responsibilities assigned to each executive, and (iii) the performance of each
executive of assigned responsibilities as measured by the progress of the
Company and the Association during the year.

The Compensation Committee considers compensation surveys prepared by The
Bank Administration Institute, America's Community Bankers, Ben S. Cole
Financial Survey of Executive Salaries and Benefits, and Milliman & Robertson.

Although the Compensation Committee did not establish executive
compensation levels on the basis of whether specific financial goals had been
achieved by the Company and the Association, the Compensation Committee (and
the Board of Directors) considered the overall profitability of the Company
and the Association when making their decisions. The Compensation Committee
believes that management compensation levels, as a whole, appropriately
reflect the application of the Company's and Association's executive
compensation policy and the progress of the Company and the Association.

The compensation for the Company's new President and Chief Executive
Officer (effective as of November 15, 2000 and succeeding the Company's former
President and Chief Executive Officer who resigned in August 2000), Kermit K.
Houser, was $200,000. The Compensation Committee believes Mr. Houser's salary
is appropriate based on competitive salary surveys.

The Committee also recommends to the Board of Directors the amount of
fees paid for service on the Board. The Committee did not recommend a change
in Board fees during the fiscal year ended September 30, 2001.

Compensation Committee consisting of: J. Gillis Hannigan, Chairman
Timothy A. Bailey
Bernard Z. Agrons

Compensation Committee Interlocks and Insider Participation. No
executive officer of the Company or the Association has served as a member of
the compensation committee of another entity, one of whose executive officers
served on the Compensation Committee. No executive officer of the Company or
the Association has served as a director of another entity, one of whose
executive officers served on the Compensation Committee. No executive officer
of the Company or the Association has served as a member of the compensation
committee of another entity, one of whose executive officers served as a
director of the Company or the Association.

- ------------------------------------------------------------------------------
PERFORMANCE GRAPH
- ------------------------------------------------------------------------------

Performance Graph. The following graph compares the cumulative total
shareholder return on the Company's Common Stock with the cumulative total
return on the Nasdaq Index (U.S. Companies) and with the SNL $1 Billion to $5
Billion Thrift Index. Total return assumes the reinvestment of all dividends.

[graph appears here]

09-30-96 09-30-97 09-30-98 09-30-99 09/30/00 09/30/01
-------- -------- -------- -------- -------- --------
<s> <c> <c> <c> <c> <c> <c>
Klamath First Bancorp, Inc. $100.00 $158.02 $126.68 $ 94.90 $ 99.22 $110.46
The Nasdaq Index (U.S. Companies) 100.00 137.27 139.44 227.82 302.47 123.64
SNL $1 Billion to $5 Billion
Thrift Index 100.00 170.95 162.95 166.28 177.53 250.02

- ------------------------------------------------------------------------------
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
- ------------------------------------------------------------------------------

Section 16(a) of the Exchange Act requires the Company's executive
officers and directors, and persons who own more than 10% of any registered
class of the Company's equity securities, to file reports of ownership and
changes in ownership with the SEC. Executive officers, directors and greater
than 10% shareholders are required by regulation to furnish the Company with
copies of all Section 16(a) forms they file.

Based solely on its review of the copies of such forms it has received
and written representations provided to the Company by the above referenced
persons, the Company believes that, during the fiscal year ended September 30,
2001, all filing requirements applicable to its reporting officers, directors
and greater than 10% shareholders were complied with properly and timely,
except for the filing of a Form 3, Initial Statement of Beneficial Ownership
of Securities, to initially report securities beneficially owned by Craig M
Moore, Secretary, which was subsequently filed and except for the filing of a
Form 5, Annual Statement of Changes in Beneficial Ownership, to report the
grant of stock options to Kermit K. Houser, President and Chief Executive
Officer, Marshall J. Alexander, Executive Vice President and Chief Financial
Officer, and Craig M Moore, Secretary, which Forms 5 were subsequently filed,
and that for Frank X. Hernandez, Senior Vice President and Chief Operating
Officer, which Form 5 has not yet been filed.

- ------------------------------------------------------------------------------
CERTAIN TRANSACTIONS WITH THE ASSOCIATION
- ------------------------------------------------------------------------------

The Association has followed the policy of granting loans to its
officers, directors and employees. Loans to such persons are made in the
ordinary course of business on substantially the same terms, including
interest rate and collateral, as those prevailing at the time for comparable
transactions with other persons (unless the loan or extension of credit is
made under a benefit program generally available to all other employees and
does not give preference to any insider over any other employee), and, in the
opinion of management, do not involve more than the normal risk of
collectability or present other unfavorable features. At September 30, 2001,
loans to directors and executive officers (excluding available lines of
credit) totalled approximately $2.7 million.

- ------------------------------------------------------------------------------
PROPOSAL II -- APPROVAL OF APPOINTMENT OF INDEPENDENT AUDITORS
- ------------------------------------------------------------------------------

Deloitte & Touche LLP served as the Company's independent auditors for
the fiscal year ended September 30, 2001. The Board of Directors has
appointed Deloitte & Touche LLP as independent auditors for the fiscal year
ending September 30, 2002, subject to approval by stockholders. A
representative of Deloitte & Touche LLP will be present at the Meeting to
respond to stockholders' questions and will have the opportunity to make a
statement if he so desires.

Audit Fees. The aggregate fees billed to the Company for professional
services rendered for the audit of the Company's financial statements for
fiscal 2001 and the reviews of the financial statements included in the
Company Forms 10-Q for that year, including travel expenses, were
approximately $185,000.

Financial Information Systems Design and Implementation Fees. No
independent public accountant performed financial information system design or
implementation work for the Company during the fiscal year ended September 30,
2001.

All Other Fees. Other than audit fees, the aggregate fees billed to the
Company by Deloitte & Touche LLP for fiscal 2001, none of which were financial
information systems design and implementation fees, were approximately
$92,000. The Audit Committee of the Board of Directors determined that the
services performed by Deloitte & Touche LLP other than audit services are not
incompatible with Deloitte & Touche LLP maintaining its independence.

If the ratification of the appointment of Deloitte & Touche LLP is not
approved by a majority of the votes cast by shareholders at the Meeting, other
independent public accountants will be considered by the Board of Directors.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
APPROVAL OF THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS INDEPENDENT AUDITORS
OF THE COMPANY FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 2002.

- ------------------------------------------------------------------------------
OTHER MATTERS
- ------------------------------------------------------------------------------

The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matters should properly come before the Meeting, it is
intended that proxies in the accompanying form will be voted in respect
thereof in accordance with the judgment of the person or persons voting the
proxies.

- ------------------------------------------------------------------------------
MISCELLANEOUS
- ------------------------------------------------------------------------------

The cost of solicitation of proxies will be borne by the Company.
Directors, officers and regular employees of the Company and the Association
may solicit proxies personally or by telecopier or telephone without
additional compensation. The Company will reimburse brokerage firms and other
custodians, nominees, and fiduciaries for reasonable expenses incurred by them
in sending proxy materials to the beneficial owners of the Common Stock.

The Company's Annual Report to Shareholders has been mailed to all
shareholders of record as of the close of business on the Record Date. Any
shareholder who has not received a copy of such annual report may obtain a
copy by writing to the Company. Such annual report is not to be treated as
part of this proxy solicitation material or as having been incorporated herein
by reference.

- ------------------------------------------------------------------------------
SHAREHOLDER PROPOSALS
- ------------------------------------------------------------------------------

In order to be eligible for inclusion in the proxy materials of the
Company for next year's Annual Meeting of Shareholders, any shareholder
proposal to take action at such meeting must be received at the Company's main
office at 540 Main Street, Klamath Falls, Oregon, no later than August 15,
2002. Any such proposals shall be subject to the requirements of the proxy
solicitation rules adopted under the Exchange Act.

The Company's Articles of Incorporation provide that shareholders will
have the opportunity to nominate directors of the Company if such nominations
are made in writing and are delivered to the Secretary of the Company not less
than 30 days nor more than 60 days before the annual meeting of shareholders;
provided, however, if less than 31 days notice is given, such notice shall be
delivered to the Secretary of the Company no later than the close of the tenth
day following the date on which notice of the meeting was mailed to
shareholders. Based on the date of the 2002 Annual Meeting, the Company
anticipates that, in order to be timely, shareholder nominations or proposals
intended to be made at the 2003 Annual Meeting must be made by December 27,
2002. As specified in the Company's Articles of Incorporation, the notice
must set forth (i) the name, age, business address and, if known, residence
address of each nominee for election as a director, (ii) the principal
occupation or employment of each nominee, (iii) the number of shares of stock
of the Company which are beneficially owned by each such nominee, (iv) such
other information as would be required to be included in a proxy statement
soliciting proxies for the election of the proposed nominee pursuant to the
Exchange Act, including, without limitation, such person's written consent to
being named in the proxy statement as a nominee and to serving as a director,
if elected, and (v) as to the shareholder giving such notice (a) his or her
name and address as they appear on the Company's books and (b) the class and
number of shares of the Company which are beneficially owned by such
shareholder.

- ------------------------------------------------------------------------------
FORM 10-K
- ------------------------------------------------------------------------------

A copy of the Annual Report on Form 10-K as filed with the SEC will be
furnished without charge to shareholders as of the close of business on the
Record Date upon written request to Craig M Moore, Secretary, Klamath First
Bancorp, Inc., 540 Main Street, Klamath Falls, Oregon 97601.

BY ORDER OF THE BOARD OF DIRECTORS

/S/CRAIG M MOORE
CRAIG M MOORE
SECRETARY

Klamath Falls, Oregon
December 26, 2001

REVOCABLE PROXY
KLAMATH FIRST BANCORP, INC.

ANNUAL MEETING OF SHAREHOLDERS
January 30, 2002

The undersigned hereby appoints the official Proxy Committee of the Board
of Directors of Klamath First Bancorp, Inc. ("Company") with full powers of
substitution to act as attorneys and proxies for the undersigned, to vote all
shares of Common Stock of the Company which the undersigned is entitled to
vote at the Annual Meeting of Shareholders ("Meeting"), to be held at the
Shilo Inn, 2500 Almond Street, Klamath Falls, Oregon, on Wednesday, January
30, 2002, at 2:00 p.m., Pacific Time, and at any and all adjournments thereof,
as follows:

VOTE VOTE
FOR WITHHELD
---- --------

1. The election as directors of all nominees [ ] [ ]
listed below (except as marked to the
contrary below).

Kermit K. Houser
J. Gillis Hannigan
Dianne E. Spires

INSTRUCTION: To withhold your vote
for any individual nominee(s), write that
nominee's(s') name(s) on the line below.

-----------------------------------------

FOR AGAINST ABSTAIN
---- ------- -------

2. The approval of the appointment of Deloitte & [ ] [ ] [ ]
Touche LLP as independent auditors for the
fiscal year ending September 30, 2002.

3. Such other matters that may properly
come before the Meeting or any
adjournments thereof.

The Board of Directors recommends a vote "FOR" the above proposals.

- ------------------------------------------------------------------------------
THIS PROXY, RETURNED PROPERLY SIGNED AND DATED, WILL BE VOTED AS DIRECTED, BUT
IF NO INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE
PROPOSITIONS STATED. IF ANY OTHER BUSINESS IS PRESENTED AT SUCH MEETING, THIS
PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT
THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE
PRESENTED AT THE MEETING.
- ------------------------------------------------------------------------------

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

Should the undersigned be present and elect to vote at the Meeting or at
any adjournment thereof and after notification to the Secretary of the Company
at the Meeting of the shareholder's decision to terminate this proxy, then the
power of said attorneys and proxies shall be deemed terminated and of no
further force and effect.

The undersigned acknowledges receipt from the Company prior to the
execution of this proxy of Notice of Annual Meeting of Shareholders, a proxy
statement for the Annual Meeting of Shareholders, and an Annual Report to
Shareholders.

Dated:
-----------------------

-------------------------------- ----------------------------------
PRINT NAME OF SHAREHOLDER PRINT NAME OF SHAREHOLDER

-------------------------------- ----------------------------------
SIGNATURE OF SHAREHOLDER SIGNATURE OF SHAREHOLDER

Please sign exactly as your name appears on this card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, only one holder need sign, but each holder
should sign, if possible.

PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PREPAID ENVELOPE.