EXHIBIT 99.1
Contacts: Kermit K. Houser Marshall J. Alexander
President and CEO Executive VP and CFO
(541)882-3444 X7133 (541)882-3444 X7120
News Release
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KLAMATH FIRST TO SELL SEVEN BRANCHES
TO THE BANK OF EASTERN OREGON
KLAMATH FALLS, OREGON - September 10, 2003 - Klamath First Bancorp, Inc.
(Nasdaq: KFBI) announced today that Klamath First Federal had agreed to sell
seven branches located in northeastern Oregon to the Bank of Eastern Oregon. The
branches that will be sold are located in the towns of Burns, Condon, Fossil,
Heppner, John Day, Prairie City and Moro. The sale includes deposit accounts of
approximately $66 million, which will double the size of the Bank of Eastern
Oregon's six branches, and its $78 million in total assets. The fixed assets and
branch locations will also be included in the sale; however, loans will not be
included. It is anticipated that the Bank of Eastern Oregon will offer
employment to all current branch employees.
Kermit K. Houser, President and Chief Executive Officer commented, "As part of
our strategic plan management and the Board of Directors have looked at the
possibility of branch sales, closures and consolidations in an effort to improve
Klamath First's operating efficiency over the past year but did not have any
specific areas or branches targeted. With the recent announcement of our
proposed merger with Sterling Financial Corporation (Nasdaq: STSA), several
community banks indicated an interest in many of our rural branch locations.
Klamath First determined that Bank of Eastern Oregon was the best candidate to
acquire its branches since Bank of Eastern Oregon shared Klamath First Federal's
commitment to customers and employees. In addition, a sale at this time would
ensure that the Klamath First customers and employees at these branches
experience only one organizational change rather than two.
We do not anticipate any further sales or closures of branches prior to the
Sterling merger," added Mr. Houser.
"The Bank of Eastern Oregon is pleased to offer customers and employees of these
branches the opportunity to join our great team. We were established in 1945 to
meet the financial needs of rural communities in eastern Oregon, and these
branch purchases will allow us to continue that tradition in markets and with
customers we are very familiar with," stated George Koffler, President and Chief
Executive Officer of the Bank of Eastern Oregon. Bank of Eastern Oregon
currently intends to partially finance the proposed branch acquisition through
the issuance of $2 million of Trust Preferred Securities.
As previously announced, Klamath is party to a merger agreement pursuant to
which Klamath will merge into Sterling Financial Corporation. Sterling was
apprised of and concurred in the sale of these seven branches. The branch sale
is expected to close in December subject to regulatory approval.
About Klamath First Bancorp, Inc.
Klamath First Bancorp, Inc. is the holding company for Klamath First Federal
Savings and Loan Association, which operate 59 offices, 57 in 26 counties
throughout Oregon and two in-store branches in South Central Washington. Klamath
First serves the state of Oregon through these offices by offering a full range
of products and services for both the consumer and business customer, including
commercial, consumer and real estate loans, various checking and savings
products, 24-hour telephone banking, and online banking with bill pay through
its web site www.KlamathFirst.com. Customers have access to brokerage and
investment services through the company's subsidiary Klamath First Financial
Services. Additionally, customers may visit new in-store branches seven days a
week with extended banking hours.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements include, but are not limited to, statements about (i) the proposed
merger between Sterling Financial Corporation and Klamath First Bancorp, Inc.;
(ii) Klamath First's plans, objectives, expectations and intentions and other
statements contained in this presentation that are not historical facts; and
(iii) other statements identified by words such as "expects," "anticipates,"
"intends," "plans," "believes," "seeks," "estimates," or words of similar
meaning generally intended to identify forward-looking statements. These
forward-looking statements are based upon the current beliefs and expectations
of the management of Klamath and are inherently subject to significant business,
economic and competitive uncertainties and contingencies, many of which are
beyond our control. In addition, these forward-looking statements are subject to
assumptions with respect to future business strategies and decisions that are
subject to change. Actual results may differ materially from the anticipated
results discussed in these forward-looking statements because of numerous
possible uncertainties.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectations expressed in the
forward-looking statements (1) governmental approvals of the merger may not be
obtained, or adverse regulatory conditions may be imposed in connection with
governmental approvals of the merger; (2) the shareholders of Klamath First or
Sterling may fail to approve the merger; (3) changes in interest rates; (4)
changes in tax laws; (5) changes in general economic conditions or (6) changes
in the securities markets. Additional factors, that could cause actual results
to differ materially from those expressed in the forward-looking statements are
discussed in Sterling's and Klamath First's reports (such as Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K) filed
with the Securities and Exchange Commission and available on the SEC's Internet
site (http://www.sec.gov). Klamath First Bancorp, Inc. disclaims any obligation
to publicly announce future events or developments that may affect the
forward-looking statements herein.
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Note: Transmitted on BusinessWire at 6:00 am PDT, September 10, 2003.