2. Disclosure
This presentation contains forward-looking
statements. Actual results may differ materially
from those currently expected. Additional
information concerning factors that could cause
such a difference is contained in the Company’s
most recent filings with the Securities and
Exchange Commission.
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2
7. Our Client Value Proposition
“To serve clients who seek the resources,
sophisticated products and expertise of large
financial institutions, along with the local
decision making, market knowledge, and
customer service orientation of a community
bank.”
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8. Profile
• $2.5B asset, 65 branches
in Oregon and SW
Washington
• Leading community
bank deposit share
• Contemporary product
offerings and superior
service
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9. The Board has reconfigured its Committee resources
• Duane McDougall named Chairman of the Audit & Compliance
Committee (present and current corporate CEO and CFO
experience)
• Prior Audit & Compliance Chairman Steven Spence named
Chairman of the Loan & Investments Committee
• Chairman Lloyd Ankeny joined the Loan & Investments
Committee
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9
10. 400,000 Statesman Journal Readers Vote
West Coast Bank #1
• When the Salem Statesman Journal’s 400,000
readers responded to a web-site survey of
favorite businesses, West Coast Bank was
voted the number one bank in the Mid-
Willamette Valley.
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11. Employee Satisfaction
96% 96% 98% 96%
100% 92%
91%
86%
90%
88%
80% 87% 87%
72% 86% 86%
81%
70% 75%
60%
61%
50% Majority of executive management team
40% joined in 2000
28%
30%
20%
10%
0%
2000 2001 2002 2003 2004 2005 2006 2007 2008
Company has a good future
Understand the strategy and are comfortable with it
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11
12. Objectives
• Significant year-over-year decline in residential real
estate construction loan balances
• Challenging market conditions for housing
• Emphasis for past 18 months on maintaining capital
and liquidity
• Control loan growth
• Competitive payment system products
• Continued high employee and customer satisfaction
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12
16. Quarter-over-Quarter Income Statement
Fav (Unfav)
Income Statement ($000's) Q1-09* Q1-08 $ %
Interest Income 28,608 38,312 (9,704) -25.3%
Interest Expense 8,478 14,736 6,258 42.5%
Net Interest Income 20,130 23,576 (3,446) -14.6%
Provision for Loan Loss 23,131 8,725 (14,406) -165.1%
Non-interest Income 4,348 10,211 (5,863) -57.4%
Non-interest Expense 22,315 22,221 (94) -0.4%
Income Before Income Taxes (20,968) 2,841 (23,809) -838.0%
Provision for Income Taxes (10,428) 842 11,270 1338.5%
Net Income (10,540) 1,999 (12,539) -627.3%
* Operating (excludes goodwill charge-off)
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17. • West Coast Bank has addressed its Two Step Program
(“TSP”) challenges
• The Bank, while actively disposing of its portfolio of
TSP, is significantly focused on post-TSP initiatives
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18. WCB continues to preserve and build Total Capital…
Total Capital
15.00%
14.00%
13.00%
12.00%
10.68%
11.00%
10.00% 10.54%
10.23%
9.00%
8.00%
12/31/06 12/31/07 3/31/08 6/30/08 9/30/08 12/31/08 3/31/09
WCB Peer Avg w/TARP Peer Avg w/o TARP
Total Capital = Risk Based Capital / Total Capital. WCB data for bank subsidiary only. Peers consist
of AWBC, BANR, CACB, CBBO, COLB, FTBK, STSA, UMPQ. Data from SNL.
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18
19. …and results in RWA decline of $117MM since YE 07
Net Risk Weighted Assets
2,480,000 2,467,000
2,460,000
2,440,000 -$117MM
2,420,000
-5%
2,400,000
2,373,000
2,380,000
2,350,400
2,360,000
2,340,000
2,320,000
2,300,000
2,280,000
12/31/2007 12/31/2008 03/31/09
* Preserved $11 million in capital or $16.5 million in pretax loss cushion wcb.com
19
20. WCB has successfully reduced the TSP portfolio and
actively manages the disposition of OREO property…
• Program discontinued October, 2007
• As of March 31, 2009, remaining TSP loans were only 1% of loans
• The TSP loan commitments have declined 94% since Q3, 2007.
• The TSP non-performing assets have peaked and will decline each
quarter going forward. This portfolio has already been written
down 28% or $36 million from $133 million to $97 million. We are
making consistent progress in selling the homes in this portfolio.
• Formed a dedicated TSP OREO sales team
• Disposed of 121 properties*, representing $34MM* in balances
through 3/31/09. 36 sales pending amounting to $8MM.
* Includes short sales and sales of OREO properties
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22. TSP properties sales expected to trend upward
significantly with total disposition forecast for year end
09…
Cumulative Properties Sold
350
328
300 290
Actual
250
205
200
150
121
100 97
Forecast*
50
0
Q4-07 Q1-08 Q2-08 Q3-08 Q4-08 Q1-09 Q2-09 Q3-09 Q4-09
• Forecast based on activity, pending sales, and seasonality
• Actual sales through Q1-09 include 74 OREO sales and 47 short sales
•Gain/loss on sales to date in line with modeled projections
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22
23. …while TSP NPAs have peaked and are expected to
decline materially throughout 2009
2-Step NPA's
$140,000
$120,000
$100,000
(000's)
$80,000
$60,000
$40,000
$20,000
$-
12/31/07 3/31/08 6/30/08 9/30/08 12/31/08 3/31/09 12/31/09
(est.)
Nonaccrual OREO
Loan balance written down 28% or $36MM from
$133MM to $97MM as of March 31, 2009
As of March 31, 2009, TSP OREO is comprised of
296 properties representing $73MM in book value wcb.com
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25. WCB Core Bank Overview
• Loan balances and pipeline are declining consistent with strategic objective
to preserve and protect capital
• Selectively reducing loan concentrations and managing credit exposures
• Targeted Condo Financing Program
• Actively managing CRE concentration and adversely risk rated assets
• Added and realigned resources to strengthen Credit Administration
• Redesigned the business model for residential construction lending
• Adding resources to the OREO sales team for non two step properties
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26. WCB loan mix provides diversity
3/31/09 % of Total % of Loan % of Total % of Total
Balance NPA’s
($000’s) Loans Category Loans Assets
CRE $879,394 44.5% $4,808 0.5% 0.2% 0.2%
C&I $462,466 23.4% $29,014 6.3% 1.5% 1.2%
Home Equity $281,186 14.2% $961 0.3% 0.0% 0.0%
Commercial $87,561 4.4% $2,922 3.3% 0.1% 0.1%
Construction
Std Mortgage $83,888 4.2% $10,790 12.9% 0.5% 0.4%
Consumer $20,794 1.1% $22 0.1% 0.0% 0.0%
Subtotal $1,815,290 91.9% $48,517 2.7% 2.5% 2.0%
Residential $133,319 6.8% $52,152 39.1% 2.6% 2.1%
Construction
Non-Std
Mortgage $26,111 1.3% $17,757 68.0% 0.9% 0.7%
Subtotal $159,431 8.1% $69,909 43.8% 3.5% 2.8%
Total $1,974,720 100.0% $118,425 6.0% 6.0% 4.8%
•NPA’s include $104.5MM in nonaccruing loans and $13.8MM in OREO
•Non-standard mortgage loans are mortgages provided to previous two-step borrowers
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27. WCB has much lower Construction and Land
Development loan exposure compared to peers…
Total Constr & Land Dev Lns % of Total Lns
35.0%
30.0% 28.8%
25.0%
20.0%
16.0%
15.0%
10.0%
5.0%
0.0%
12/31/07 3/31/08 6/30/08 9/30/08 12/31/08
WCB incl. 2-Step WCB excl. 2-Step (Core Bank) Peer Average
Peers consist of AWBC, BANR, CACB, CBBO, COLB, FTBK, STSA, UMPQ. Data from SNL.
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28. …and our Core Bank commercial construction exposure
is significantly less than NW Pacific peers
Commercial Land, Site Development, & Vertical
Construction
25.0%
20.0% 19.8%
15.0%
10.0%
5.6%
5.0%
0.0%
12/31/07 3/31/08 6/30/08 9/30/08 12/31/08
WCB Peer Average
• Particularly in the more risky land and site development components
Peers consist of AWBC, BANR, CACB, CBBO, COLB, FTBK, STSA, UMPQ. Data from SNL.
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29. WCB’s Core Bank NPA % is approximately 60% of Pacific
NW peers
NPA's % of Total Assets
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
12/31/07 3/31/08 6/30/08 9/30/08 12/31/08 3/31/09
WCB incl. 2-Step Peer Avg WCB excl. 2-Step
Peers consist of AWBC, BANR, CACB, CBBO, COLB, FTBK, STSA, UMPQ. Data from SNL.
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30. Most Core Bank NPAs are centered in residential
construction loan categories and non standard mortgages
Non 2-Step NPA's
$120,000
$100,000
$80,000
(000's)
Residential
$60,000 Construction
$40,000
$20,000
$-
12/31/07 3/31/08 6/30/08 9/30/08 12/31/08 3/31/09
Nonaccrual OREO
•Commercial, commercial construction, commercial real estate, and
home equity loans represented 86% of total loans at March 31, 2009
•The combined NPA’s to total assets ratio for these loans was 1.80% at
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March 31, 2009 - a satisfactory level given the economic environment
30
31. Management and the Board have focused near term
earning enhancement efforts on aggressive expense
reductions…
• Significant and continuing FTE reduction
• Eliminated 2008 bonus payout and reductions in
incentive programs
• Across the board salary freeze and salary structure
adjustments
• Suspended 401(k) match
• Employee benefit reductions
• “Go Green” operational expense reduction campaign
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32. …resulting in significant expense savings
Actual Actual Budget '09 vs.'07
$000's 2007 2008 2009 $ %
Incentive $ 5,235 $ 565 $ 475 (4,760) -90.9%
Commissions 3,847 1,171 977 (2,870) -74.6%
Marketing 4,524 3,583 2,917 (1,607) -35.5%
401(k) Match 941 (14) - (941) -100.0%
Salaries 37,110 38,852 36,556 (554) -1.5%
Oth Employee Benefits 652 513 334 (318) -48.8%
Janitorial 672 756 439 (233) -34.7%
Courier 927 924 696 (231) -24.9%
Travel & Hotel 682 639 498 (184) -27.0%
Printing 586 499 453 (133) -22.7%
$ 55,176 $ 47,488 $ 43,345 (11,831) -21.4%
• FTE are currently 768; down 133 FTE from ‘08 budget and 32 FTE from ‘08
actual
• Annual expense savings of $11.8 million will on a proforma basis increase our
capital $7.7 million annually. Other expense areas being reviewed are: health
insurance, vendor contracts, office supplies, recruiting, and subscriptions. wcb.com
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33. WCB has actively sought to enhance its liquidity
• Liquidity and dependency ratios solid compared to Pacific NW
and national peers
• Aggressive calling campaign on large relationships
• Consider economical alternative sources
– Brokered deposits (none at 12/31/08 excl. Cdars; $51MM at
3/31/09) currently inexpensive
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34. WCB’s short term noncore funding level lower than
peers…
Net Short Term Noncore Funding Dependence
30.00%
NW Peers
25.00%
20.00%
15.00%
WCBO
10.00%
5.00%
0.00%
12/31/05 12/31/06 12/31/07 12/31/08
WCBO NW Peer Avg Nat'l Peer Avg
•NW Peers consist of AWBC, BANR, CACB, CBBO, COLB, FTBK, STSA, UMPQ.
•National Peers consist of banks with $1 bln to $3 bln assets.
•Data from FFIEC Uniform Bank Performance Report.
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35. …and net noncore funding level also below peers
Net Noncore Funding Dependence
40.00%
Nat’l Peers
35.00%
30.00%
25.00%
20.00%
15.00% WCBO
10.00%
5.00%
0.00%
12/31/05 12/31/06 12/31/07 12/31/08
WCBO NW Peer Avg Nat'l Peer Avg
•NW Peers consist of AWBC, BANR, CACB, CBBO, COLB, FTBK, STSA, UMPQ.
•National Peers consist of banks with $1 bln to $3 bln assets.
•Data from FFIEC Uniform Bank Performance Report.
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36. At YE 08, WCB had the lowest use of brokered deposits
amongst peers
Brokered Deposits to Total Deposits
16.00%
NW Peers
14.00%
12.00%
10.00%
8.00%
6.00%
4.00%
WCBO
2.00%
0.00%
12/31/05 12/31/06 12/31/07 12/31/08 3/31/09
WCBO NW Peer Avg Nat'l Peer Avg
•For WCBO, represents Cdars deposits only at 12/31/08.
•NW Peers consist of AWBC, BANR, CACB, CBBO, COLB, FTBK, STSA, UMPQ.
•National Peers consist of banks with $1 bln to $3 bln assets.
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36 •Data from FFIEC Uniform Bank Performance Report.
37. WCB maintains strong core deposit base and an excellent
deposit mix
$000's 3/31/09 % of Total 3/31/08 $ Chg % Chg
Demand Deposits 489,274 23.8% 472,116 17,158 3.6%
Savings and Interest Bearing Demand 351,154 17.1% 366,267 (15,113) -4.1%
Money Market 595,954 29.0% 652,559 (56,605) -8.7%
Time Deposits 615,716 30.0% 570,905 44,811 7.8%
Total Deposits 2,052,098 100.0% 2,061,847 (9,749) -0.5%
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38. WCB focuses investments to retain our high community
bank market share…
#1 Community
Bank Rank in Over
95% of Franchise
Total
WCB Market WCB
Deposits Deposits Market Community All Bank
MSA (mm's) (mm's) Share Bank Rank Rank
Portland/Vancouver $872 $29,583 2.9% 1 6
Salem $687 $3,930 17.5% 1 1
Coast (Lincoln County) $201 $737 27.3% 1 1
Olympia $133 $3,081 4.3% 4 7
Source: FDIC Summary of Deposits. Data as of 6/30/08
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38
39. Key focus of our deposit growth and liquidity strategies
include protecting our investments in Commercial
Banking…
• Retain relationship managers and key staff added since 2000
• Adjust existing contemporary products including cash
management and depository transaction services as required
• Maintain outstanding level of customer satisfaction and loyalty
• Leverage relationship managers’ connectivity with branch
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40. 40
200
400
600
800
1,000
1,200
1,400
0
12/31/2000
66%
34%
3/31/2001
6/30/2001
9/30/2001
12/31/2001
3/31/2002
6/30/2002
9/30/2002
12/31/2002
3/31/2003
6/30/2003
9/30/2003
12/31/2003
3/31/2004
6/30/2004
9/30/2004
12/31/2004
3/31/2005
6/30/2005
Dec 2000 – Mar 2009
9/30/2005
12/31/2005
3/31/2006
Consumer vs. Business Deposits
6/30/2006
9/30/2006
12/31/2006
3/31/2007
6/30/2007
9/30/2007
12/31/2007
Consumer (6% CAGR)
3/31/2008
6/30/2008
9/30/2008
12/31/2008
Business and Public (11% CAGR)
3/31/2009
44%
56%
…and business deposits fueling core deposit growth…
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42. WCB produced strong total checking account growth…
40,500 or 79% Increase in Checking
Accounts Since Dec ’03
92
100
Number of Checking Accounts (000's)
90
12%
CAGR
23
22
80
22
70
20
60 51 18
50
16
69
69
14 64
40 58
49
40
30
37
20
12/31/2003 12/31/2004 12/31/2005 12/31/2006 12/31/2007 12/31/2008 3/31/2009
Consumer Business
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42
43. WCB has developed a comprehensive payment systems
platform…
Product Commercial Small Business Consumer
Credit Cards X X X
Debit Cards X X X
Debit & Credit Cards with Rewards X X X
Payroll Cards X X
Bill Payment & Presentment X X
ACH, ARC, RCK X X X
Treasury Management X X
Lock Box X
Remote Capture (iDepositTM) X X
Remote Capture with Remittance X
Smart Scan Remote Capture X
Merchant Processing X X
Gift Cards – Visa & Branded X X X
SafePoint Cash Mgmt X wcb.com
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46. …and diversified fee income sources
% Chg
Q1-09 Q1-08
Deposit Account Service Charges $ 3,805.0 $ 3,635.0 5%
Payment Systems 2,099.0 2,121.0 -1%
Trust and Investments 919.0 1,585.0 -42%
Gains on Sale of Loans 343.0 860.0 -60%
Other 1,937.0 1,420.0 36%
Total Noninterest Income (1) $ 9,103.0 $ 9,621.0 -5%
• Fee income as a % of total assets nearly 60% higher than U.S. peer
average. WCB Q3-08 noninterest income to average assets was
1.35% vs. 0.85% peer median. (2)
(1) Excludes gain/loss on sale of securities and OREO Gain (Loss) Valuation Adjustments
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46 (2) Peers defined as publicly traded U.S. banks with assets between $1 billion and $3 billion. Source: SNL
47. Conclusion
• While actively and aggressively disposing of TSP-
related OREO, Management and the Board believe the
company’s TSP era has ended
• Our focus on executing our basic business model is
unchanged and utilizes our core strengths while we
navigate a challenging economic environment.
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48. Conclusion…cont
• We are expecting several key trends looking forward
• Continued decline in construction loan portfolio likely to more than offset
muted growth in other loan categories caused by soft economy
• With improved client confidence, in part generated by higher FDIC
insurance coverage, we project more growth across insured deposit
categories in 2009 than in 2008.
• Believe majority of residential land, site development, and vertical
construction issues recognized through 3/31/09.
• Significant time and effort will be spent on resolving adversely classified
assets and OREO properties.
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