Exhibit 99.3
                          [HOLDING COMPANY LETTERHEAD]

FOR IMMEDIATE RELEASE                                      FOR MORE INFORMATION,
                                                                        CONTACT:
May 23, 2005                               George A. Rosenbaum, Jr., EVP and CFO
                                                                  (505) 622-6201


                    FIRST FEDERAL BANC OF THE SOUTHWEST, INC.
               PARTICIPATES IN TRUST PREFERRED POOLED TRANSACTION

Roswell, New Mexico - First Federal Banc of the Southwest, Inc. (the "Company")
announced today its participation in the amount of $3.0 million in a pool of
subordinated debt securities to be issued by the Company and other financial
institutions to a trust in a method generally referred to as a trust preferred
pooled transaction. The subordinated debt securities and corresponding trust
preferred securities have a term of thirty years and will bear a fixed rate of
interest of 6.145% for the first five years and an adjustable rate of interest
indexed to the three-month LIBOR plus 1.85% thereafter.

This press release does not constitute an offer to sell or the solicitation of
an offer to buy any securities, nor will there be any sale of securities in any
state or jurisdiction in which such offer, solicitation or sale would be
unlawful.

                           Forward-Looking Statements
                           --------------------------

Certain statements contained in this press release that are not historical
facts, including, but not limited to, statements that can be identified by the
use of forward-looking terminology such as "may," "expect," "anticipate,"
"predict," "believe," "plan," "estimate" or "continue" or the negative thereof
or other variations thereon or comparable terminology, are forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995, and involve a number of risks and uncertainties. The actual results of the
future events described in such forward-looking statements in this press release
could differ materially from those stated in such forward-looking statements.
Among the factors that could cause actual results to differ materially are:
third party claims or actions in relation to ongoing or future litigation or
bankruptcy matters; interest rate fluctuations; level of delinquencies; defaults
and prepayments; general economic conditions; competition; government
regulation; unanticipated developments in connection with the bankruptcy actions
or litigation mentioned above, including judicial variation from existing legal
precedent and the decision by one or more parties to appeal decisions rendered;
the risks and uncertainties discussed elsewhere from time to time in the
Company's periodic reports filed with the Securities and Exchange Commission and
other public statements.

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