EvergreenBancorp Earns $152,000 or $0.06 Per Diluted Share in 2Q08

SEATTLE, July 31, 2008 (PRIME NEWSWIRE) -- EvergreenBancorp, Inc. (OTCBB:EVGG), the holding company for EvergreenBank, today reported investments in its branch franchise produced a 23% increase in loans. In the second quarter of 2008, Evergreen earned $152,000, or $0.06 per diluted share, compared to $747,000, or $0.31 per diluted share in the second quarter a year ago. In the first half of 2008, operating profits were boosted by a gain from its ownership of Visa, Inc. of $5.6 million pretax, or $1.58 per diluted share after tax. In the first six months of 2008, net income totaled $3.6 million, or $1.47 per diluted share, compared to $1.4 million, or $0.59 per diluted share in the first six months of 2007.

"As we continue to invest in our branch network, we are generating solid growth in loans throughout our system, although the cost of expansion continues to impact earnings in the short term. Open just a few months, our new office in Kent has gotten off to an excellent start," stated Gerald O. Hatler, president and chief executive officer.



 Second Quarter 2008 Financial Highlights
 (6/30/2008 compared with 6/30/2007)

 * Net loans increased 23% to $405 million, with construction loans
   representing 14% of the portfolio.
 * Total assets rose 18% to $457 million.
 * Capital ratios for the Bank remained strong with Tier 1 Capital
   to average assets of 9.12%, well above the regulatory
   requirements for well-capitalized institutions of 5% for the
   Bank.
 * A cash dividend of $0.07 per share will be paid August 22 to
   shareholders of record August 6, 2008.

Balance Sheet and Asset Quality

Total assets grew 18% to $457 million at June 30, 2008, from $387 million at June 30, 2007. Net loans increased 23% to $405 million from $331 million a year ago. The loan portfolio continues to be well diversified and well secured. At June 30, 2008, commercial loans accounted for 24% of the portfolio, commercial real estate loans were 48%, construction and land development loans were 14%, single family residential loans totaled 9% and consumer loans contributed 5% of gross loans.



 LOANS                      June 30,  March 31, June 30, Second Quarter
 (in thousands)               2008      2008      2007      % Change
                            ------------------------------------------
 Commercial                  $97,975   $88,058   $88,173       11%
 Real estate:
  Commercial                 196,960   174,340   134,557       46%
  Construction                56,947    62,738    55,337        3%
  Residential 1-4 family      36,711    40,778    34,739        6%
 Consumer and other           22,401    23,430    21,119        6%
                            ----------------------------

 Total                      $410,994  $389,344  $333,925       23%
                            ============================

"While the bulk of our loans continue to perform well, two substantial relationships are not performing, causing asset quality to decline in the quarter," said Gordon Browning, chief financial officer. Total nonperforming loans rose to $7.5 million, or 1.64% of assets. One of the nonperforming loans is for $3.9 million and is secured by a residential land parcel in Redmond, Washington valued recently at $7 million. This loan is currently the subject of a dispute between its two business partners who are working to dissolve their business. The other nonperforming relationship totals $3.1 million in construction loans for two high end homes in Seattle and North Pierce County, for which additional reserves were booked in the first quarter.

The allowance for loan losses stood at $5.6 million or 1.36% of total loans at June 30, 2008, compared with $3.3 million or 0.97% of total loans at June 30, 2007. In the second quarter of 2008, net charge-offs totaled $187,000, or 0.05% of average loans, compared to net recoveries of $35,000 for the same quarter a year ago. Year-to-date, net charge-offs were $914,000, or 0.23% of average loans, compared to net charge-offs of $29,000 in the first six months of 2007.

Deposits rose 7% to $320 million, a $20 million increase from one year ago. Shareholders' equity was up 16% year over year to $28.8 million. Book value per share was up 13% to $11.98 at June 30, 2008, from $10.57 at June 30, 2007. The 92,000 equivalent restricted shares of Visa, Inc.(NYSE:V) that Evergreen owns are carried on its books at zero value, but will eventually add value to the franchise.

Operating Results

Second quarter operating revenue totaled $4.3 million compared to $4.4 million in the second quarter a year ago. For the first six months of 2008, operating revenues were $14.3 million compared to $8.5 million in the first six months of 2007. Revenue includes net interest income before provision for loan losses and non interest income excluding Visa gain or expenses.

Second quarter net interest income, before the provision for loan losses, rose 1% to $3.9 million and grew 5% in the first six months of 2008 to $7.9 million compared to the year ago periods. In the second quarter of 2008, net interest margin (taxable-equivalent) was 3.73% compared to 4.40% for the second quarter of last year. In the first six months of 2008, net interest margin fell to 3.83% from 4.40% in the first half of 2007, reflecting the sharp decline in short term interest rates in the past year.

"We are continuing to build reserves both because our loan portfolio is growing, but also due to the increase in our non-performing loans," said Michael Tibbits, chief credit officer. Evergreen provisioned $509,000 for loan losses in the second quarter compared to $233,000 in the second quarter of 2007. In the first six months of 2008, the provision for loan losses totaled $2.3 million compared to $496,000 in the first six months of 2007.

After the provision for loan losses, net interest income totaled $3.4 million in the second quarter of 2008, compared to $3.6 million in the second quarter a year ago. Year to date, net interest income after the provision was $5.5 million compared to $7.0 million in the first half of 2007.

Second quarter noninterest income was $408,000 compared to $521,000 in the second quarter a year ago, reflecting lower fee income from service charges and credit card processing. In the first six months of 2008, noninterest income was $6.4 million compared to $1.0 million in the first six months of 2007. Excluding the Visa gain, noninterest income in the first half of 2008 totaled $846,000.

The significant impact from Visa's initial public offering contributed to a large gain on the income statement in the first half of the year. The shares of Visa were valued at more than $6.6 million, as of yesterday's close, although this value will not be reflected on the balance sheet until they are sold, and are restricted from sale for at least three years to offset Visa's possible litigation exposure.

Noninterest expense rose 18% in the second quarter of 2008 to $3.6 million compared with $3.0 million in the same quarter a year ago, reflecting overall franchise growth and increased FDIC insurance premiums. Noninterest expense in the first half of 2008 increased 15% to $6.9 million from $5.9 million in the first half of 2007. The ratio of annualized noninterest expense to average assets was 3.29% for the second quarter and 3.20% for the first six months of 2008 compared to 3.29% and 3.31% for the respective periods of 2007.



                          EvergreenBancorp, Inc.
                        GAAP Reconciliation Table

 Core Earnings to GAAP reconciliation (1)
 (in thousands except share
  and per share data)                 2Q08         1Q08         2Q07
                                   -----------------------------------
 GAAP net income                   $     152    $   3,882    $     747
 Visa related costs or gains              --       (5,587)          --
 Net tax effect                           --        1,749           --
 Core earnings                     $     152    $      44    $     747
                                   ===================================

 Core earnings per share (1)
  Basic core earnings per share    $    0.06    $    0.02    $    0.32
  Diluted core earnings per share  $    0.06    $    0.02    $    0.31

 Weighted average basic common
  shares outstanding               2,401,556    2,392,074    2,357,308
 Weighted average diluted common
  shares outstanding               2,417,669    2,422,054    2,395,827

 (1) Core earnings is defined as reported net income excluding certain
     non-routine items that occur infrequently. These non-routine
     items include significant infrequent gains, losses, or expenses
     that are not reflective of continuing operations.Core earnings
     is a non-GAAP financial measure.

About EvergreenBancorp and EvergreenBank

Founded in 1971, EvergreenBank is a subsidiary of EvergreenBancorp, Inc., a bank holding company headquartered in Seattle, Washington. EvergreenBank is a community bank with seven offices located in Seattle, Bellevue, Lynnwood, Federal Way and Kent. The Bank offers a full suite of personal and business banking services. Services include commercial, real estate, and consumer lending; savings, checking, and certificate of deposit accounts; health savings accounts; Internet banking and merchant credit card processing services. Visit www.EvergreenBancorp.com to learn more.

This press release contains "forward-looking statements" within the meaning of federal securities law, including statements concerning business strategies and their intended results, and similar statements concerning expectations that are not historical facts. The forward-looking statements in this press release are subject to numerous risks and uncertainties, including the effects of economic conditions, demand for financial services, competitive conditions, regulatory changes, and the availability of capital to finance growth, which could cause actual results to differ materially from those expressed in or implied by the statements herein.



                           EvergreenBancorp Inc.
                      Consolidated Financial Highlights

                                                Quarterly
 (unaudited)                       -----------------------------------
 (in thousands except per share      2008         2007      2nd Quarter
  and ratio data)                   2nd Qtr      2nd Qtr     % Change
 EARNINGS RESULTS
 Revenue                           $   4,319    $   4,384       -1%
 Net interest income               $   3,911    $   3,863        1%
 Provision for loan losses         $     509    $     233      118%
 Noninterest income                $     408    $     521      -22%
 Noninterest expense               $   3,598    $   3,040       18%
 Net income                        $     152    $     747      -80%
 Basic earnings per share          $    0.06    $    0.32      -80%
 Diluted earnings per share        $    0.06    $    0.31      -80%
 Weighted average basic
  shares outstanding               2,401,556    2,357,308        2%
 Weighted average diluted
  shares outstanding               2,417,669    2,395,827        1%

 PERFORMANCE RATIOS
 Return on average assets
  (annualized)                          0.14%        0.81%
 Return on average common
  equity (annualized)                   2.12%       12.22%
 Net interest margin
  (fully tax-equivalent)                3.73%        4.40%
 Noninterest expense to
  average assets (annualized)           3.29%        3.29%

 CAPITAL
 Equity to assets                       6.31%        6.45%
 Book value per share              $   11.98    $   10.57       13%

 ASSET QUALITY
 Net loan charge-offs (recoveries) $     187    $     (35)    -635%
 Allowance for loan losses         $   5,593    $   3,251       72%
 Allowance for losses
  to total loans                        1.36%        0.97%
 Nonperforming loans               $   7,492    $   1,407      432%
 Nonperforming assets
  to total assets                       1.64%        0.36%

 END OF PERIOD BALANCES
 Total loans                       $ 410,994    $ 333,925       23%
 Total assets                      $ 456,789    $ 386,622       18%
 Deposits                          $ 320,447    $ 300,234        7%
 Shareholders' equity              $  28,837    $  24,935       16%

 AVERAGE BALANCES
 Total loans                       $ 399,561    $ 320,167       25%
 Earning assets                    $ 423,540    $ 353,774       20%
 Total assets                      $ 439,511    $ 370,066       19%
 Deposits                          $ 310,796    $ 287,883        8%
 Shareholders' equity              $  28,865    $  24,511       18%



                          EvergreenBancorp Inc.
                     Consolidated Financial Highlights

                                             Six months ended
 (unaudited)                       -----------------------------------
 (in thousands except per share     June 30,     June 30,    YTD to YTD
  and ratio data)                     2008         2007       % Change
 EARNINGS RESULTS
 Revenue                           $  14,308    $   8,498        68%
 Net interest income               $   7,875    $   7,502         5%
 Provision for loan losses         $   2,341    $     496       372%
 Noninterest income                $   6,433    $     996       546%
 Noninterest expense               $   6,852    $   5,935        15%
 Net income                        $   3,559    $   1,403       154%
 Basic earnings per share          $    1.48    $    0.60       149%
 Diluted earnings per share        $    1.47    $    0.59       151%
 Weighted average basic
  shares outstanding               2,396,815    2,355,108         2%
 Weighted average diluted
  shares outstanding               2,419,453    2,395,868         1%

 PERFORMANCE RATIOS
 Return on average
  assets (annualized)                   1.66%        0.78%
 Return on average common
  equity (annualized)                  26.24%       11.68%
 Net interest margin
  (fully tax-equivalent)                3.83%        4.40%
 Noninterest expense to average
  assets (annualized)                   3.20%        3.31%

 CAPITAL
 Equity to assets                       6.31%        6.45%
 Book value per share              $   11.98    $   10.57        13%

 ASSET QUALITY
 Net loan charge-offs              $     914    $      29      3052%
 Allowance for loan losses         $   5,593    $   3,251        72%
 Allowance for losses
  to total loans                        1.36%        0.97%
 Nonperforming loans               $   7,492    $   1,407       432%
 Nonperforming assets
  to total assets                       1.64%        0.36%

 END OF PERIOD BALANCES
 Total loans                       $ 410,994    $ 333,925        23%
 Total assets                      $ 456,789    $ 386,622        18%
 Deposits                          $ 320,447    $ 300,234         7%
 Shareholders' equity              $  28,837    $  24,935        16%

 AVERAGE BALANCES
 Total loans                       $ 391,454    $ 312,321        25%
 Earning assets                    $ 415,301    $ 345,404        20%
 Total assets                      $ 430,887    $ 362,073        19%
 Deposits                          $ 309,368    $ 274,465        13%
 Shareholders' equity              $  27,273    $  24,217        13%



                        EvergreenBancorp Inc.
                 Consolidated Statements of Income

 (unaudited)                        Three months ended        Second
 (in thousands except               June 30,     June 30,     Quarter
  per share data)                     2008         2007      % Change
 Interest and dividend income
 Loans, including fees             $   6,820    $   6,861        -1%
 Federal funds sold and other             43           71       -39%
 Investments securities:
   Taxable securities                    115          284       -60%
   Tax exempt securities                  25           31       -19%
                                   ----------------------
 Total interest and dividend income    7,003        7,247        -3%

 Interest expense
 Deposits                              2,237        2,595       -14%
 Federal funds purchased and
  securities sold under agreements
  to repurchase                            1           28       -96%
 Federal Home Loan Bankadvances          718          447        61%
 Junior subordinated debt                136          314       -57%
                                   ----------------------
 Total interest expense                3,092        3,384        -9%

 Net interest income                   3,911        3,863         1%
 Provision for loan losses               509          233       118%
                                   ----------------------

 Net interest income after
  provision for loan losses            3,402        3,630        -6%

 Noninterest income
 Service charges on
  deposit accounts                       290          363       -20%
 Merchant credit card processing          23           48       -52%

 Net earnings on bank
  owned life insurance                    58           59        -2%
 Other noninterest income                 37           51       -27%
                                   ----------------------
 Total noninterest income                408          521       -22%

 Noninterestexpense
 Salaries and employee benefits        1,625        1,396        16%
 Occupancy and equipment                 580          484        20%
 Data processing                         223          272       -18%
 Professional fees                        86           96       -10%
 Marketing                               303          165        84%
 State & local taxes                     140          139         1%
 Outside service fees                    130          120         8%
 Other noninterest expense               511          368        39%
                                   ----------------------
 Total noninterest expense             3,598        3,040        18%

 Income before income tax expense        212        1,111       -81%
 Income tax expense                       60          364       -84%
                                   ----------------------

 Net income                        $     152    $     747       -80%
                                   ======================

 Earnings per share basic          $    0.06    $    0.32       -80%
 Earnings per share diluted        $    0.06    $    0.31       -80%

 Weighted average basic
  shares outstanding               2,401,556    2,357,308         2%
 Weighted average diluted
  shares outstanding               2,417,669    2,395,827         1%



                           EvergreenBancorp Inc.
                     Consolidated Statements of Income

 (unaudited)                          Six months ended         Second
 (in thousands except               June 30,    June 30,       Quarter
  per share data)                     2008         2007       % Change
 Interest and dividend income
 Loans, including fees             $  14,088    $  13,256          6%
 Federal funds sold and other            107          107          0%
 Investments securities:
   Taxable securities                    227          572        -60%
   Tax exempt securities                  52           63        -17%
                                   ----------------------
 Total interest and dividend income   14,474       13,998          3%

 Interest expense

 Deposits                              4,775        4,766          0%
 Federal funds purchased and
  securities sold under agreements
  to repurchase                            3           64        -95%
 Federal Home Loan Bankadvances        1,491        1,118         33%
 Junior subordinated debt                330          548        -40%
                                   ----------------------
 Total interest expense                6,599        6,496          2%

 Net interest income                   7,875        7,502          5%
 Provision for loan losses             2,341          496        372%
                                   ----------------------

 Net interest income after
  provision for loan losses            5,534        7,006        -21%

 Noninterest income

 Service charges on
  deposit accounts                       602          698        -14%
 Merchant credit card processing          47           92        -49%
 Net earnings on bank
  owned life insurance                   106          115         -8%
 Other noninterest income                 91           91          0%
 Gain on redemption and interest
  in escrow fund of Visa stock         5,587           --         NM
                                   ----------------------
 Total noninterest income              6,433          996        546%

 Noninterestexpense

 Salaries and employee benefits        3,074        2,853          8%
 Occupancy and equipment               1,090          963         13%
 Data processing                         470          478         -2%
 Professional fees                       219          192         14%
 Marketing                               367          226         62%
 State revenue and sales
  tax expense                            322          246         31%
 Outside service fees                    245          244          0%
 Other noninterest expense             1,065          733         45%
                                   ----------------------
 Total noninterest expense             6,852        5,935         15%

 Income before income tax expense      5,115        2,067        147%
 Income tax expense                    1,556          664        134%
                                   ----------------------

 Net income                        $   3,559    $   1,403        154%
                                   ======================

 Earnings per share basic          $    1.48    $    0.60        149%
 Earnings per share diluted        $    1.47    $    0.59        151%

 Weighted average basic
  shares outstanding               2,396,815    2,355,108          2%
 Weighted average diluted
  shares outstanding               2,419,453    2,395,868          1%




                               EvergreenBancorp Inc.
                           Consolidated Balance Sheets
                                                                 Second
 (unaudited)                      June 30,   Dec. 31,   June 30,  Qtr %
 (in thousands except share data)   2008       2007       2007   Change
                                  ------------------------------------
 Assets Cash and cash equivalents:
  Cash and due from banks         $  6,497   $ 14,076   $  6,604    -2%
  Interest-bearing deposits
   in financial institutions         5,858      5,923      6,963   -16%
  Federal funds sold                 8,010      2,383        414  1835%
                                  ------------------------------
 Total cash and cash equivalents    20,365     22,382     13,981    46%

 Investment securities:
  Available for sale                15,208     14,446     27,643   -45%

 Loans                             410,994    375,428    333,925    23%
 Allowance for loan losses          (5,593)    (4,166)    (3,251)   72%
                                  ------------------------------
 Net Loans                         405,401    371,262    330,674    23%

 Premises and equipment              3,515      2,886      3,247     8%
 Bank owned life insurance           5,643      5,537      5,430     4%
 Interest in escrow fund
  of Visa stock                      2,122         --         --    NM
 Accrued interest and other assets   4,535      6,274      5,647   -20%
                                  ------------------------------
 Total assets                     $456,789   $422,787   $386,622    18%
                                  ==============================

 Liabilities
 Deposits:

  Noninterest bearing             $ 50,362   $ 59,458   $ 52,372    -4%
  Interest bearing                 270,085    250,013    247,862     9%
                                  ------------------------------
 Total deposits                    320,447    309,471    300,234     7%

 Junior subordinated debt           12,372     12,372     17,372   -29%
 Federal Home Loan Bank advances    89,725     69,910     39,361   128%
 Indemnification liabilities         2,122      2,122         --    NM
 Accrued expenses and
  other liabilities                  3,286      3,476      4,720   -30%
                                  ------------------------------
 Total liabilities                 427,952    397,351    361,687    18%

 Stockholders' equity

 Preferred stock: No par value;
  100,000 shares authorized
  issued and outstanding - none         --         --         --    NM
 Common stock and surplus: No
  par value; 15,000,000 shares
  authorized; 2,406,339 shares
  issued and outstanding at
  June 30, 2008                     21,708     21,467     21,240     2%
 Retained earnings                   7,194      3,972      4,527    59%
 Accumulated other
  comprehensive loss                   (65)        (3)      (832)  -92%
                                  ------------------------------
 Total stockholders' equity         28,837     25,436     24,935    16%
                                  ------------------------------

 Total liabilities and
  stockholders' equity            $456,789   $422,787   $386,622    18%
                                  ==============================
CONTACT: EvergreenBancorp, Inc.
         Gerald O. Hatler, President and CEO
           206/628-4250
         Gordon D. Browning, EVP & Chief Financial Officer
           206/749-7350
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