With our new Lacey and Bellingham offices opening in late fourth quarter, and welcoming the addition of Mt. Rainier and Town Center banks to our family during the third quarter, we currently have 55 branches in ten counties in Washington and Oregon.

Columbia Bank has the number one share of the deposit market in Pierce County, and Bank of Astoria continues to maintain their number one status in their primary market of Clatsop County after 40 years of serving Northwest Oregon’s coastal communities. Mt. Rainier Bank has 40% of the deposit market in their primary area on the Enumclaw plateau as well. These statistics (June, 2007 FDIC data), while gratifying, simply reflect the success we’ve achieved through maintaining our focus on our core values. Our Columbia Bankers continue to enhance and deepen their relationships with our customers and with each other through their commitment to internal and external customer service.

As we never tire of mentioning, our Columbia Bankers are the foundation for our success. Recently, a non-profit group that surveys local consumers about various services conducted a customer service survey about local banks. Columbia Bank was rated superior overall by 93% of our customers who responded to the survey. In order to maintain these results, we need to attract and retain the highest caliber of employees. In 2007, NW Jobs announced that Columbia Bank was named as the favorite local large company in Pierce County. We were also selected by the Puget Sound Business Journal as one of Washington’s Best Workplaces, and by Washington Association of Businesses as one of the Best Places to Work. Our customers truly notice the difference.

We received another honor in 2007 as well. On September 10th, we had the wonderful opportunity to ring the closing bell at the NASDAQ Stock Market in New York. It was very exciting to see the Columbia name up in lights in Times Square.

The summer of 2008 will mark our 15th anniversary, and we believe we are well positioned for success in the coming years. As always, we remain committed to the core values which have been the foundation for our success. Thank you for your continued support.

Sincerely,