EX-99.1 2 v191249_ex99-1.htm

NEWS RELEASE

July 22, 2010

FOR IMMEDIATE RELEASE	Contact: Michael J. Blodnick
	(406) 751-4701
	Ron J. Copher
	(406) 751-7706

GLACIER BANCORP, INC. ANNOUNCES

RESULTS FOR QUARTER ENDED JUNE 30, 2010

HIGHLIGHTS:

·	Net earnings for the quarter of $13.2 million and year-to-date of $23.3 million.

·	Diluted earnings per share of $0.19 for the quarter and $0.35 year-to-date.

·	Non-interest bearing deposits increased $24.0 million, or 12 percent annualized, for the quarter.

·	Non-performing assets as a percentage of bank assets decreased for the first time in 11 quarters.

·	Early stage delinquencies (accruing 30-89 day loans) decreased during the quarter.

·	Successfully completed the integration and data conversion for First National Bank & Trust.

·	Declared dividend for the 101st consecutive quarter. Dividend declared of $0.13 per share.

Earnings Summary - unaudited	Three months						Six months
($ in thousands, except per share data)	ended June 30,						ended June 30,
	2010			2009			2010			2009

Net earnings	$	13,222			10,652		$	23,292		$	26,431
Diluted earnings per share	$	0.19			0.17		$	0.35		$	0.43
Return on average assets (annualized)		0.85	%		0.77	%		0.76	%		0.96	%
Return on average equity (annualized)		6.25	%		6.18	%		6.02	%		7.72	%

KALISPELL, MONTANA - Glacier Bancorp, Inc. (Nasdaq GS: GBCI) reported net earnings of $13.2 million for the second quarter of 2010, an increase of $2.6 million, or 24 percent, from the $10.7 million net earnings reported for the second quarter of 2009. The diluted earnings per share of $0.19 for the quarter represented a 12 percent increase from the diluted earnings per share of $0.17 for the same quarter of 2009. Annualized return on average assets and return on average equity for the second quarter were 0.85 percent and 6.25 percent, respectively, which compares with prior year returns for the second quarter of 0.77 percent and 6.18 percent, respectively.

Net earnings for the six months ended June 30, 2010 were $23.3 million, which is a decrease of $3.1 million or 12 percent, over the prior year. Diluted earnings per share of $0.35 is a decrease of 19 percent over $0.43 earned in the first half of 2009.

“Second quarter results were an improvement over recent quarters. We still have more work to do in order to achieve the level of earnings we historically deliver and for us to be satisfied with our performance. However, we are encouraged by the progress we have made recently and hope to maintain this momentum” said Mick Blodnick, President and Chief Executive Officer. “One reason for the improvement was a reduced provision for loan loss, reflecting improving credit quality metrics. In addition, the quarter was straight forward and was absent much noise. The only exception was the sale of our merchant card servicing portfolio which added almost $0.02 per share to earnings,” Blodnick said.

										$ Change from			$ Change from
Assets	June 30,			December 31,			June 30,			December 31,			June 30,
(Unaudited - $ in thousands)	2010			2009			2009			2009			2009

Cash on hand and in banks	$	95,603			120,731			100,773			(25,128	)		(5,170	)
Investments, interest bearing deposits, FHLB stock, FRB stock, and fed funds		1,816,133			1,596,238			1,081,160			219,895			734,973
Loans:
Residential real estate		764,286			797,626			836,917			(33,340	)		(72,631	)
Commercial		2,570,140			2,613,218			2,591,149			(43,078	)		(21,009	)
Consumer and other		697,743			719,401			700,693			(21,658	)		(2,950	)
Loans receivable, gross		4,032,169			4,130,245			4,128,759			(98,076	)		(96,590	)
Allowance for loan and lease losses		(141,665	)		(142,927	)		(97,374	)		1,262			(44,291	)
Loans receivable, net		3,890,504			3,987,318			4,031,385			(96,814	)		(140,881	)
Other assets		492,596			487,508			425,106			5,088			67,490
Total assets	$	6,294,836			6,191,795			5,638,424			103,041			656,412

Total assets at June 30 2010 were $6.295 billion, which is $103 million, or 2 percent, greater than total assets of $6.192 billion at December 31, 2009. Total assets increased $656 million, or 12 percent, from June 30, 2009, of which $272 million, including $161 million in loans, related to the acquisition of First National Bank & Trust (“First National”) in October 2009.

Investment securities, including interest bearing deposits, FHLB and FRB stock, and federal funds sold, have increased $220 million, or 14 percent, from December 31, 2009 and increased $735 million, or 68 percent, from June 30, 2009. The Company continues to purchase investment securities as loan originations slow, such purchases are predominately mortgage-backed securities issued by Freddie Mac and Fannie Mae with short weighted average lives. The Company continues to be very selective in its purchases of tax-exempt investment securities. Investment securities represent 29 percent of total assets at June 30, 2010 versus 19 percent of total assets at June 30, 2009.

At June 30, 2010, gross loans were $4.032 billion, a decrease of $98 million over gross loans of $4.130 billion at December 31, 2009. Excluding net charge-offs of $39 million and loans transferred to other real estate of $46 million, loans decreased $13 million, or 1 percent annualized, from December 31, 2009.

Credit Quality Summary	June 30,			March 31,			December 31,			June 30,
(Unaudited - $ in thousands)	2010			2010			2009			2009

Allowance for loan and lease losses - beginning of year	$	142,927			142,927			76,739			76,739
Provision expense		38,156			20,910			124,618			40,855
Charge-offs		(41,584	)		(21,477	)		(60,896	)		(21,246	)
Recoveries		2,166			1,240			2,466			1,026
Allowance for loan and lease losses - end of period	$	141,665			143,600			142,927			97,374

Real estate and other assets owned	$	64,419			59,481			57,320			47,424
Accruing loans 90 days or more overdue		3,030			10,489			5,537			10,086
Non-accrual loans		190,338			198,169			198,281			116,362
Total non-performing assets	$	257,787			268,139			261,138			173,872

Allowance for loan and lease losses as a percentage of non-performing assets		55	%		54	%		55	%		56	%

Non-performing assets as a percentage of subsidiary assets		4.01	%		4.19	%		4.13	%		3.06	%

Allowance for loan and lease losses as a percentage of total loans		3.51	%		3.53	%		3.46	%		2.36	%

Net charge-offs as a percentage of total loans		(0.98	)%		(0.50	)%		(1.42	)%		(0.49	)%

Accruing loans 30-89 days overdue	$	36,487			61,255			87,491			62,637

Credit Quality

At June 30, 2010, the allowance for loan and lease losses was $141.7 million, an increase of $44.3 million, or 45 percent, from a year ago. The allowance was 3.51 percent of total loans outstanding at June 30, 2010, such percentage down slightly from the 3.53 percent at March 31, 2010, but substantially higher than the 2.36 percent at June 30, 2009. The allowance was 55 percent of non-performing assets at June 30, 2010, the same percentage at the prior year end and down from 56 percent a year ago. Non-performing assets as a percentage of total subsidiary assets at June 30, 2010 were at 4.01 percent, down from 4.13 percent as of prior year end, and up from 3.06 percent at June 30, 2009. Loan portfolio growth, composition, average loan size, credit quality considerations, and other environmental factors will continue to determine the level of additional provision for loan loss expense.

Credit Quality Trends
(Unaudited - $ in thousands)								Accruing
								Loans 30-89			Non-Performing
	Provision				ALLL			Days Overdue			Assets to
	for Loan		Net		as a Percent			as a Percent of			Total Bank
	Losses		Charge-Offs		of Loans			Loans			Assets
Q2 2010	$	17,246		19,181		3.51	%		0.90	%		4.01	%
Q1 2010		20,910		20,237		3.53	%		1.50	%		4.19	%

Q4 2009		36,713		19,116		3.46	%		2.12	%		4.13	%
Q3 2009		47,050		19,094		3.10	%		1.08	%		4.10	%
Q2 2009		25,140		11,543		2.36	%		1.52	%		3.06	%
Q1 2009		15,715		8,677		2.01	%		1.60	%		1.97	%

Q4 2008		12,223		3,742		1.86	%		1.33	%		1.46	%
Q3 2008		8,715		3,889		1.67	%		0.65	%		1.30	%

Allowance for Loan and Lease Losses

The current quarter provision for loan loss expense was $17.2 million, a decrease of $3.7 million from prior quarter and a decrease of $7.9 million from the same quarter in 2009. Net charged-off loans for the current quarter were $19.2 million compared to $20.2 million for the prior quarter and $11.5 million for the same quarter in 2009. “Asset quality trends were encouraging although this is still a challenging credit environment,” Blodnick said. “The reduction in non-performing assets through the first half of the year was a pleasant surprise. We have been predicting higher levels of non-performing assets through the first half of the year. For the second straight quarter we also saw a significant reduction in early stage delinquencies. Nonetheless, it is still far too early to determine whether this trend will continue,” Blodnick said.

During the quarter, the Company formed a wholly owned subsidiary, GBCI Other Real Estate (“GORE”) to isolate bank foreclosed properties for legal protection and administrative purposes. During the quarter, foreclosed properties were transferred to the new entity from bank subsidiaries at fair market value and such properties are currently held for sale.

For additional information regarding credit quality and a breakout of the loan portfolio by regulatory classification, see the exhibits at the end of this press release.

							$ Change from			$ Change from
Liabilities	June 30,		December 31,		June 30,		December 31,			June 30,
(Unaudited - $ in thousands)	2010		2009		2009		2009			2009

Non-interest bearing deposits	$	852,121		810,550		754,844		41,571			97,277
Interest bearing deposits		3,657,995		3,289,602		2,631,599		368,393			1,026,396
Advances from Federal Home Loan Bank		529,982		790,367		613,478		(260,385	)		(83,496	)
Federal Reserve Bank discount window		-		225,000		587,000		(225,000	)		(587,000	)
Securities sold under agreements to repurchase and other borrowed funds		234,460		226,251		197,971		8,209			36,489
Other liabilities		49,470		39,147		43,711		10,323			5,759
Subordinated debentures		125,060		124,988		120,157		72			4,903
Total liabilities	$	5,449,088		5,505,905		4,948,760		(56,817	)		500,328

As of June 30, 2010, non-interest bearing deposits increased $42 million, or 10 percent annualized, since December 31, 2009 and increased $97 million, or 13 percent, since June 30, 2009. Interest bearing deposits of $3.658 billion at June 30, 2010 includes $414 million issued through the Certificate of Deposit Account Registry System. Interest bearing deposits increased $368 million, or 22 percent annualized, from December 31, 2009 and $1.026 billion, or 39 percent from June 30, 2009. The increase in interest bearing deposits from December 31, 2009 and June 30, 2009 includes $308 million and $507 million, respectively, from wholesale deposits. The increase in non-interest bearing deposits and interest bearing deposits from June 30, 2009 includes $39 million and $197 million, respectively, from the First National acquisition.

As a result of the deposit growth, borrowings overall have been reduced. Federal Home Loan Bank (“FHLB”) advances decreased $260 million, or 33 percent, from December 31, 2009 and decreased $83 million, or 14 percent, from June 30, 2009. There were no Federal Reserve Bank borrowings through the Term Auction Facility program (“TAF”) at June 30, 2010 due to cessation of the TAF program by the Federal Reserve. TAF borrowings totaled $225 million at December 31, 2009 and $587 million at June 30, 2009. Repurchase agreements and other borrowed funds were $234 million at June 30, 2010, an increase of $8 million from December 31, 2009 and an increase of $36 million from June 30, 2009.

Stockholders' equity - unaudited										$ Change from		$ Change from
($ in thousands except per share data)	June 30,			December 31,			June 30,			December 31,		June 30,
	2010			2009			2009			2009		2009

Common equity	$	836,955			686,238			692,046			150,717		144,909
Accumulated other comprehensive income (loss)		8,793			(348	)		(2,382	)		9,141		11,175
Total stockholders' equity		845,748			685,890			689,664			159,858		156,084
Goodwill and core deposit intangible, net		(158,575	)		(160,196	)		(157,736	)		1,621		(839	)
Tangible stockholders' equity	$	687,173			525,694			531,928			161,479		155,245

Stockholders' equity to total assets		13.44	%		11.08	%		12.23	%
Tangible stockholders' equity to total tangible assets		11.20	%		8.72	%		9.71	%
Book value per common share	$	11.76			11.13			11.21			0.63		0.55
Tangible book value per common share	$	9.56			8.53			8.65			1.03		0.91
Market price per share at end of period	$	14.67			13.72			14.77			0.95		(0.10	)

Total stockholders’ equity and book value per share increased $156 million and $0.55 per share, respectively, from June 30, 2009, such increases largely the result of the $146 million in net proceeds from the Company’s March equity offering of 10.291 million shares. Tangible stockholders’ equity has increased $155 million, or 29 percent, since June 30, 2009, with tangible stockholders’ equity to tangible assets at 11.20 percent and 9.71 percent as of June 30, 2010 and June 30, 2009, respectively. Accumulated other comprehensive income (loss), representing net unrealized gains or losses (net of tax) on investment securities, increased $9.1 million since December 31, 2009 and $11.2 million from June 30, 2009.

Cash Dividend

On June 30, 2010, the board of directors declared a cash dividend of $0.13 per share, payable July 22, 2010 to shareholders of record on July 13, 2010. Future cash dividends will depend on a variety of factors, including net income, capital, asset quality and general economic conditions.

Operating Results for Three Months Ended June 30, 2010

Compared to March 31, 2010 and June 30, 2009

Revenue summary
(Unaudited - $ in thousands)	Three months ended
	June 30,			March 31,			June 30,
	2010			2010			2009
Net interest income
Interest income	$	73,818			73,398			74,420
Interest expense		13,749			13,884			13,939
Total net interest income		60,069			59,514			60,481

Non-interest income
Service charges, loan fees, and other fees		11,900			10,646			11,377
Gain on sale of loans		6,133			3,891			9,071
Gain on sale of investments		242			314			-
Other income		3,143			1,332			870
Total non-interest income		21,418			16,183			21,318
	$	81,487			75,697			81,799

Net interest margin (tax-equivalent)		4.35	%		4.43	%		4.87	%

(Unaudited - $ in thousands)	$ Change from			$ Change from			% Change from			% Change from
	March 31,			June 30,			March 31,			June 30,
	2010			2009			2010			2009
Net interest income
Interest income	$	420			(602	)		1	%		-1	%
Interest expense		(135	)		(190	)		-1	%		-1	%
Total net interest income		555			(412	)		1	%		-1	%

Non-interest income
Service charges, loan fees, and other fees		1,254			523			12	%		5	%
Gain on sale of loans		2,242			(2,938	)		58	%		-32	%
Gain on sale of investments		(72	)		242			-23	%		n/m
Other income		1,811			2,273			136	%		261	%
Total non-interest income		5,235			100			32	%		0	%
	$	5,790			(312	)		8	%		0	%

n/m - not measurable

Net Interest Income

Net interest income for the current quarter increased $555 thousand and decreased $412 thousand over prior year’s quarter. The current quarter net interest margin as a percentage of earning assets, on a tax-equivalent basis, was 4.35 percent which is 8 basis points lower than the 4.43 percent for the prior quarter and included a 4 basis points reduction from the reversal of interest on non-accrual loans. The net interest margin for the current quarter is 52 basis points lower than the 4.87 percent result for the second quarter of 2009. “Though funding costs continue to remain stable, investment of proceeds from loan paydowns and the March equity offering into low yielding investment securities continues to compress the net interest margin,” said Ron Copher, Chief Financial Officer.

Non-interest Income

Non-interest income for the quarter totaled $21.4 million, an increase of $5.2 million over the prior quarter and $100 thousand over the same quarter as last year. Fee income of $11.9 million increased $1.3 million, or 12 percent, during the quarter primarily from an increase in debit card income. This compares to an increase of $523 thousand, or 5 percent, over the same period last year. Gain on sale of loans increased $2.2 million, or 58 percent, over the prior quarter as a reduction in mortgage interest rates during the second quarter led to an increase in loan origination volume. Gain on sale of loans decreased $2.9 million, or 32 percent, over the same period last year, primarily the result of a significant reduction in re-finance activity and a slowing of residential loans originated and sold in the secondary market. Net gain on sale of investments was $242 thousand for the current quarter 2010 compared to $314 thousand for the previous quarter. Other income of $3.1 million for the current quarter is an increase of $1.8 million and $2.3 million from prior quarter and prior year second quarter, respectively, of which $1.8 million relates to the current quarter sale of Mountain West Bank’s merchant card servicing portfolio.

Non-interest expense summary	Three months ended
(Unaudited - $ in thousands)	June 30,		March 31,		June 30,
	2010		2010		2009
Compensation and employee benefits and relatd expenses	$	21,652	$	21,356	$	20,710
Occupancy and equipment expense		5,988		5,948		5,611
Advertising and promotion expense		1,644		1,592		1,722
Outsourced data processing		761		694		680
Core deposit intangibles amortization		801		820		762
Other real estate owned expense		7,373		2,318		2,321
Federal Deposit Insurance premiums		2,165		2,200		3,832
Other expenses		7,852		7,033		7,325
Total non-interest expense	$	48,236	$	41,961	$	42,963

(Unaudited - $ in thousands)	$ Change from			$ Change from			% Change from			% Change from
	March 31,			June 30,			March 31,			June 30,
	2010			2009			2010			2009
Compensation and employee benefits and relatd expenses	$	296		$	942			1	%		5	%
Occupancy and equipment expense		40			377			1	%		7	%
Advertising and promotion expense		52			(78	)		3	%		-5	%
Outsourced data processing		67			81			10	%		12	%
Core deposit intangibles amortization		(19	)		39			-2	%		5	%
Other real estate owned expense		5,055			5,052			218	%		218	%
FDIC premiums		(35	)		(1,667	)		-2	%		-44	%
Other expenses		819			527			12	%		7	%
Total non-interest expense	$	6,275		$	5,273			15	%		12	%

Non-interest Expense

Non-interest expense of $48.2 million for the quarter increased by $6.3 million, or 15 percent, from the prior quarter and increased $5.3 million, or 12 percent, from the prior year second quarter. Compensation and employee benefits of $21.7 million increased only $296 thousand, or 1 percent, from the previous quarter and $942 thousand, or 5 percent, from the prior year second quarter which is due to the addition of First National employees. The number of full-time equivalent employees increased from 1,651 to 1,654 during the quarter, and increased from 1,597 since the end of the 2009 second quarter.

Occupancy and equipment expense increased $40 thousand, or 1 percent, from the prior quarter and increased $377 thousand, or 7 percent, from the prior year second quarter. Advertising and promotion expense increased $52 thousand, or 3 percent, from prior quarter and decreased $78 thousand, or 5 percent, from the second quarter of 2009. Other real estate owned expenses increased $5.1 million, or 218 percent, from prior quarter and increased $5.1 million, or 218 percent, from the prior year. The current quarter other real estate owned expense of $7.4 million included $1.5 million of operating expenses, $2.9 million of fair value write-downs, and $3.0 million of loss on sale of other real estate owned. The other real estate owned expenses have increased as the Company moves to aggressively dispose of problem assets and other real estate owned. FDIC premiums decreased $1.7 million, or 44 percent, from the prior year second quarter which included a FDIC special assessment. Other expenses increased $819 thousand, or 12 percent, from the prior quarter and increased $527 thousand, or 7 percent, from the prior year second quarter. “Other real estate owned expenses and write-downs were at an extraordinary high level this past quarter,” Blodnick said. “We expect this expense category to remain elevated for the next couple of quarters as we work to move these properties. All other expense categories were in line or below expectations.”

Efficiency Ratio

The efficiency ratio (non-interest expense / net interest income plus non-interest income) was 59 percent for the quarter, compared to 53 percent for the 2009 second quarter. The increase in the efficiency ratio from the prior year is the result of the increase in other expenses primarily from other real estate owned expenses, losses and write-downs.

Operating Results for Six Months Ended June 30, 2010 Compared to June 30, 2009

Revenue summary
(Unaudited - $ in thousands)	Six months ended						$ Change From			% Change From
	June 30,			June 30,			June 30,			June 30,
	2010			2009			2009			2009
Net interest income
Interest income	$	147,216		$	149,952		$	(2,736	)		-2	%
Interest expense		27,633			29,093			(1,460	)		-5	%
Net interest income		119,583			120,859			(1,276	)		-1	%

Non-interest income
Service charges, loan fees, and other fees		22,546			21,556			990			5	%
Gain on sale of loans		10,024			15,221			(5,197	)		-34	%
Gain on sale of investments		556			-			556			n/m
Other income		4,475			1,918			2,557			133	%
Total non-interest income		37,601			38,695			(1,094	)		-3	%
	$	157,184		$	159,554		$	(2,370	)		-1	%

Net interest margin (tax-equivalent)		4.39	%		4.90	%

Net Interest Income

Net interest income for the six month period decreased $1.3 million, or 1 percent, over the same period in 2009. Total interest income decreased $2.7 million, or 2 percent, while total interest expense decreased $1.5 million, or 5 percent. The decrease in interest income is due to a lower yield and volume of loans coupled with an increase in lower yielding investment securities. The decrease in interest expense is primarily attributable to the rate decreases on interest bearing deposits and lower cost borrowings. The net interest margin as a percentage of earning assets, on a tax equivalent basis, decreased 51 basis points from 4.90 percent for 2009 to 4.39 percent for 2010.

Non-interest Income

Non-interest income decreased $1.1 million over the same period in 2009. Fee income for the first half of 2010 has increased $990 thousand, or 5 percent, compared to prior year primarily from an increase in debit card income. Gain on sale of loans decreased $5.2 million, or 34 percent, over the first six months of last year, primarily the result of a significant reduction in re-finance activity and a slowing of residential loans originated and sold in the secondary market. Other income increased $2.6 million over the same period in 2009, of which $1.8 million relates to the current quarter sale of Mountain West Bank’s merchant card servicing portfolio.

Non-interest expense summary	Six months ended				$ Change From			% Change From
(Unaudited - $ in thousands)	June 30,		June 30,		June 30,			June 30,
	2010		2009		2009			2009

Compensation and employee benefits	$	43,008	$	42,654	$	354			1	%
Occupancy and equipment expense		11,936		11,506		430			4	%
Advertising and promotion expense		3,236		3,446		(210	)		-6	%
Outsourced data processing		1,455		1,351		104			8	%
Core deposit intangibles amortization		1,621		1,536		85			6	%
Other real estate owned expense		9,691		2,841		6,850			241	%
FDIC premiums		4,365		5,000		(635	)		-13	%
Other expenses		14,885		14,255		630			4	%
Total non-interest expense	$	90,197	$	82,589	$	7,608			9	%

Non-interest Expense

Non-interest expense for the first six month of 2010 increased by $7.6 million, or 9 percent, from the same period prior year. Compensation and employee benefits increased $354 thousand, or 1 percent, from 2009. Occupancy and equipment expense increased $430 thousand, or 4 percent, reflecting the cost of additional locations and facility upgrades. Advertising and promotion expense decreased by $210 thousand, or 6 percent, from 2009. Other real estate owned expense increased $6.9 million, or 241 percent, from the prior first six months. The other real estate owned expenses for the first six months of 2010 of $9.7 million included $2.2 million of operating expenses, $3.3 million of fair value write-downs, and $4.2 of loss on sale of other real estate owned. FDIC premiums decreased $635 thousand, or 13 percent, from the prior year first six months which included a special assessment of $2.5 million. Other expense increased $630 thousand, or 4 percent, from the prior year.

Efficiency Ratio

The efficiency ratio (non-interest expense / net interest income plus non-interest income) was 57 percent for the first six months of 2010, compared to 52 percent for the same period in 2009. The increase in the efficiency ratio from the prior year is the result of the increase in other expenses primarily from other real estate owned expenses, losses and write-downs.

Allowance for Loan and Lease Losses

The provision for loan loss expense was $38.2 million for the first six months of 2010, a decrease of $2.7 million, or 7 percent, from the same period in 2009. Net charged-off loans during the six months ended June 30, 2010 was $39.4 million, an increase of $19.2 million from the same period in 2009.

About Glacier Bancorp, Inc.

Glacier Bancorp, Inc. is a regional multi-bank holding company providing commercial banking services in 60 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and conducts its operations principally through eleven community bank subsidiaries. These subsidiaries include: six Montana banks - Glacier Bank of Kalispell, First Security Bank of Missoula, Valley Bank of Helena, Big Sky Western Bank of Bozeman, Western Security Bank of Billings, First Bank of Montana of Lewistown; Mountain West Bank in Idaho, Utah and Washington; 1st Bank in Wyoming and Utah; First National Bank & Trust in Wyoming; Citizens Community Bank in Idaho; and Bank of the San Juans in Colorado.

This news release may contain 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 management’s plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “should,” “projects,” “seeks,” “estimates” or words of similar meaning. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company’s control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations in the forward-looking statements, including those set forth in this news release:

the risks associated with lending and potential adverse changes of the credit quality of loans in the Company’s portfolio, including as a result of declines in the housing and real estate markets in its geographic areas;

increased loan delinquency rates;

the risks presented by a continued economic downturn, which could adversely affect credit quality, loan collateral values, other real estate owned values, investment values, liquidity and capital levels, dividends and loan originations;

changes in market interest rates, which could adversely affect the Company’s net interest income and profitability;

legislative or regulatory changes that adversely affect the Company’s business, ability to complete pending or prospective future acquisitions, limit certain sources of revenue, or increase cost of operations;

costs or difficulties related to the integration of acquisitions;

the goodwill recorded in connection with acquisitions could become impaired, which may have an adverse impact on the Company’s earnings and capital;

reduced demand for banking products and services;

the risks presented by public stock market volatility, which could adversely affect the Company’s stock value and the ability to raise capital in the future;

competition from other financial services companies in our markets; and

the Company’s success in managing risks involved in the foregoing.

The Company does not undertake any obligation to publicly correct or update any forward-looking statement if we later become aware that it is not likely to be achieved.

Visit our website at www.glacierbancorp.com

Glacier Bancorp, Inc.

Consolidated Condensed Statements of Financial Condition

(Unaudited - $ in thousands except per share data)	June 30,			December 31,			June 30,
	2010			2009			2009
Assets:
Cash on hand and in banks	$	95,603			120,731			100,773
Federal funds sold		71,605			87,155			62,405
Interest bearing cash deposits		1,260			2,689			24,608
Cash and cash equivalents		168,468			210,575			187,786

Investment securities, available-for-sale		1,743,268			1,506,394			994,147
Loans held for sale		73,207			66,330			92,166
Loans receivable, gross		3,958,962			4,063,915			4,036,593
Allowance for loan and lease losses		(141,665	)		(142,927	)		(97,374	)
Loans receivable, net		3,890,504			3,987,318			4,031,385

Premises and equipment, net		144,361			140,921			135,902
Other real estate owned		64,419			57,320			47,424
Accrued interest receivable		29,973			29,729			30,346
Deferred tax asset		35,361			41,082			14,890
Core deposit intangible, net		12,316			13,937			11,477
Goodwill		146,259			146,259			146,259
Other assets		59,907			58,260			38,808
Total assets	$	6,294,836			6,191,795			5,638,424

Liabilities:
Non-interest bearing deposits	$	852,121			810,550			754,844
Interest bearing deposits		3,657,995			3,289,602			2,631,599
Advances from Federal Home Loan Bank		529,982			790,367			613,478
Securities sold under agreements to repurchase		224,397			212,506			180,779
Federal Reserve Bank discount window		-			225,000			587,000
Other borrowed funds		10,063			13,745			17,192
Accrued interest payable		8,300			7,928			8,421
Subordinated debentures		125,060			124,988			120,157
Other liabilities		41,170			31,219			35,290
Total liabilities		5,449,088			5,505,905			4,948,760

Stockholders' equity:
Preferred shares, $.01 par value per share. 1,000,000 shares authorized. None issued or outstanding		-			-			-
Common stock, $.01 par value per share. 117,187,500 shares authorized		719			616			615
Paid-in capital		643,512			497,493			495,223
Retained earnings - substantially restricted		192,724			188,129			196,208
Accumulated other comprehensive income (loss)		8,793			(348	)		(2,382	)
Total stockholders' equity		845,748			685,890			689,664
Total liabilities and stockholders' equity	$	6,294,836			6,191,795			5,638,424

Number of shares outstanding		71,915,073			61,619,803			61,519,808
Book value of equity per share		11.76			11.13			11.21

Glacier Bancorp, Inc.

Consolidated Condensed Statements of Operations

(Unaudited - $ in thousands except per share data)	Three months ended June 30,						Six months ended June 30,
	2010			2009			2010			2009
Interest income:
Residential real estate loans	$	11,421			13,871			23,254			28,212
Commercial loans		37,003			37,597			73,675			75,563
Consumer and other loans		10,720			11,142			21,360			22,481
Investment securities and other		14,674			11,810			28,927			23,696
Total interest income		73,818			74,420			147,216			149,952

Interest expense:
Deposits		9,222			9,433			18,553			19,567
Federal Home Loan Bank advances		2,454			1,852			4,765			3,671
Securities sold under agreements to repurchase		399			409			815			1,003
Subordinated debentures		1,648			1,676			3,284			3,583
Other borrowed funds		26			569			216			1,269
Total interest expense		13,749			13,939			27,633			29,093

Net interest income		60,069			60,481			119,583			120,859
Provision for loan losses		17,246			25,140			38,156			40,855
Net interest income after provision for loan losses		42,823			35,341			81,427			80,004

Non-interest income:
Service charges and other fees		10,641			10,215			20,161			19,234
Miscellaneous loan fees and charges		1,259			1,162			2,385			2,322
Gain on sale of loans		6,133			9,071			10,024			15,221
Gain on sale of investments		242			-			556			-
Other income		3,143			870			4,475			1,918
Total non-interest income		21,418			21,318			37,601			38,695

Non-interest expense:
Compensation, employee benefits and related expenses		21,652			20,710			43,008			42,654
Occupancy and equipment expense		5,988			5,611			11,936			11,506
Advertising and promotion expense		1,644			1,722			3,236			3,446
Outsourced data processing expense		761			680			1,455			1,351
Core deposit intangibles amortization		801			762			1,621			1,536
Other real estate owned expense		7,373			2,321			9,691			2,841
Federal Deposit Insurance Corporation premiums		2,165			3,832			4,365			5,000
Other expenses		7,852			7,325			14,885			14,255
Total non-interest expense		48,236			42,963			90,197			82,589
Earnings before income taxes		16,005			13,696			28,831			36,110

Federal and state income tax expense		2,783			3,044			5,539			9,679
Net earnings	$	13,222			10,652			23,292			26,431

Basic earnings per share		0.19			0.17			0.35			0.43
Diluted earnings per share		0.19			0.17			0.35			0.43
Dividends declared per share		0.13			0.13			0.26			0.26
Return on average assets (annualized)		0.85	%		0.77	%		0.76	%		0.96	%
Return on average equity (annualized)		6.25	%		6.18	%		6.02	%		7.72	%
Average outstanding shares - basic		71,913,102			61,515,946			67,363,476			61,489,422
Average outstanding shares - diluted		71,914,894			61,518,289			67,364,377			61,493,266

Glacier Bancorp, Inc.

Average Balance Sheet

	For the Three months ended 6/30/10							For the Six months ended 6/30/10
(Unaudited - $ in thousands)			Interest		Average					Interest		Average
	Average		and		Yield/			Average		and		Yield/
	Balance		Dividends		Rate			Balance		Dividends		Rate
Assets:
Residential real estate loans	$	768,174	$	11,421		5.95	%	$	775,634	$	23,254		6.00	%
Commercial loans		2,588,734		37,003		5.73	%		2,590,621		73,675		5.73	%
Consumer and other loans		695,835		10,720		6.18	%		693,525		21,360		6.21	%
Total loans		4,052,743		59,144		5.85	%		4,059,780		118,289		5.88	%
Tax -exempt investment securities 1		473,222		5,870		4.96	%		466,530		11,438		4.90	%
Other investment securities 2		1,294,892		8,804		2.72	%		1,238,682		17,489		2.82	%
Total Earning Assets		5,820,857		73,818		5.09	%		5,764,992		147,216		5.15	%
Goodwill and core deposit intangible		159,039							159,443
Non-earning assets		291,083							279,947
Total assets	$	6,270,979						$	6,204,382

Liabilities:
NOW accounts	$	714,714	$	673		0.38	%	$	715,472	$	1,406		0.40	%
Savings accounts		341,882		189		0.22	%		336,807		393		0.24	%
Money market accounts		847,712		1,962		0.93	%		829,746		3,925		0.95	%
Certificates accounts		1,080,561		5,183		1.92	%		1,076,479		10,594		1.98	%
Wholesale deposits 3		602,342		1,215		0.81	%		488,388		2,235		0.92	%
Advances from FHLB		634,182		2,454		1.55	%		717,628		4,765		1.34	%
Repurchase agreements and other borrowed funds		352,840		2,073		2.36	%		429,973		4,315		2.02	%
Total interest bearing liabilities		4,574,233		13,749		1.21	%		4,594,493		27,633		1.21	%
Non-interest bearing deposits		808,371							794,263
Other liabilities		39,645							35,545
Total Liabilities		5,422,249							5,424,301

Stockholders' equity:
Common stock		719							674
Paid-in capital		643,395							578,959
Retained earnings		196,250							194,954
Accumulated other comprehensive income		8,366							5,494
Total stockholders' equity		848,730							780,081
Total liabilities and stockholders' equity	$	6,270,979						$	6,204,382

Net interest income			$	60,069						$	119,583
Net interest spread						3.88	%						3.94	%
Net interest margin						4.14	%						4.18	%
Net interest margin (tax-equivalent)						4.35	%						4.39	%

1	Excludes tax effect of $5,064,000 and $2,599,000 on tax-exempt investment security income for the year-to-date and quarter ended June 30, 2010, respectively.

2	Excludes tax effect of $709,000 and $397,000 on investment security tax credits for the year-to-date and quarter ended June 30, 2010, respectively.

3	Wholesale deposits include brokered deposits classified as NOW, money market demand, and CD's.

Glacier Bancorp, Inc.

Loan Portfolio - by Regulatory Classification

(Unaudited - $ in thousands)

	Loans Receivable, Gross by Bank							% Change			% Change
	Balance			Balance		Balance		from			from
	6/30/2010			12/31/2009		6/30/2009		12/31/2009			6/30/2009
Glacier	$	893,809			942,254		965,399		-5	%		-7	%
Mountain West		916,582			957,451		989,371		-4	%		-7	%
First Security		577,795			566,713		581,908		2	%		-1	%
1st Bank		283,825			296,913		314,755		-4	%		-10	%
Western		316,893			323,375		349,150		-2	%		-9	%
Big Sky		266,540			270,970		285,515		-2	%		-7	%
Valley		194,521			187,283		195,662		4	%		-1	%
First National		152,970			153,058		-		0	%		n/m
Citizens		168,406			166,049		169,507		1	%		-1	%
First Bank - MT		116,920			117,017		125,184		0	%		-7	%
San Juans		147,721			149,162		152,308		-1	%		-3	%
Eliminations		(3,813	)		-		-		n/m			n/m
Total	$	4,032,169			4,130,245		4,128,759		-2	%		-2	%

	Land, Lot and Other Construction Loans by Bank							% Change			% Change
	Balance			Balance		Balance		from			from
	6/30/2010			12/31/2009		6/30/2009		12/31/2009			6/30/2009
Glacier	$	150,723			165,734		196,140		-9	%		-23	%
Mountain West		190,060			217,078		254,625		-12	%		-25	%
First Security		78,218			71,404		83,013		10	%		-6	%
1st Bank		30,800			36,888		41,784		-17	%		-26	%
Western		31,056			32,045		38,554		-3	%		-19	%
Big Sky		64,739			71,365		74,240		-9	%		-13	%
Valley		13,622			14,704		17,140		-7	%		-21	%
First National		13,184			10,247		-		29	%		n/m
Citizens		13,034			13,263		22,145		-2	%		-41	%
First Bank - MT		808			1,010		5,208		-20	%		-84	%
San Juans		32,286			39,621		33,923		-19	%		-5	%
Total	$	618,530			673,359		766,772		-8	%		-19	%

	Land, Lot and Other Construction Loans by Bank, by Type at 6/30/10
				Consumer				Developed			Commercial
	Land			Land or		Unimproved		Lots for			Developed			Other
	Development			Lot		Land		Operative Builders			Lot			Construction
Glacier	$	62,805			30,739		30,565		9,198			17,416			-
Mountain West		49,542			68,580		20,511		25,500			8,775			17,152
First Security		28,358			7,079		24,114		4,685			502			13,480
1st Bank		8,130			11,636		4,007		221			2,536			4,270
Western		15,669			6,129		4,805		587			2,022			1,844
Big Sky		21,563			17,856		10,115		1,192			2,546			11,467
Valley		2,273			5,582		1,225		106			3,310			1,126
First National		2,464			3,622		1,469		578			2,159			2,892
Citizens		2,934			2,517		2,602		50			660			4,271
First Bank - MT		-			57		751		-			-			-
San Juans		4,125			17,033		2,216		-			8,211			701
Total	$	197,863			170,830		102,380		42,117			48,137			57,203

														Custom &
	Residential Construction Loans by Bank, by Type							% Change			% Change			Owner		Pre-Sold
	Balance			Balance		Balance		from			from			Occupied		& Spec
	6/30/2010			12/31/2009		6/30/2009		12/31/2009			6/30/2009			6/30/2010		6/30/2010
Glacier	$	45,722			57,183		79,887		-20	%		-43	%	$	8,799		36,923
Mountain West		23,997			57,437		80,356		-58	%		-70	%		6,614		17,383
First Security		14,600			19,664		17,991		-26	%		-19	%		5,911		8,689
1st Bank		12,272			17,633		23,080		-30	%		-47	%		8,419		3,853
Western		1,795			2,245		3,399		-20	%		-47	%		1,136		659
Big Sky		16,875			20,679		31,421		-18	%		-46	%		790		16,085
Valley		5,595			5,170		5,267		8	%		6	%		4,369		1,226
First National		2,607			2,612		-		0	%		n/m			1,290		1,317
Citizens		10,994			13,211		17,106		-17	%		-36	%		5,247		5,747
First Bank - MT		178			234		-		-24	%		n/m			178		-
San Juans		7,095			13,811		12,898		-49	%		-45	%		6,286		809
Total	$	141,730			209,879		271,405		-32	%		-48	%	$	49,039		92,691

Glacier Bancorp, Inc.

Loan Portfolio - by Regulatory Classification (continued)

(Unaudited - $ in thousands)

	Single Family Residential Loans by Bank, by Type						% Change			% Change			1st		Junior
	Balance		Balance		Balance		from			from			Lien		Lien
	6/30/2010		12/31/2009		6/30/2009		12/31/2009			6/30/2009			6/30/2010		6/30/2010
Glacier	$	187,625		204,789		201,281		-8	%		-7	%		165,262		22,363
Mountain West		296,102		278,158		282,957		6	%		5	%		255,884		40,218
First Security		86,963		82,141		86,958		6	%		0	%		73,355		13,608
1st Bank		59,292		65,555		65,365		-10	%		-9	%		54,750		4,542
Western		47,532		50,502		59,511		-6	%		-20	%		45,525		2,007
Big Sky		32,216		33,308		32,473		-3	%		-1	%		28,272		3,944
Valley		66,055		66,644		71,680		-1	%		-8	%		54,529		11,526
First National		15,080		19,239		-		-22	%		n/m			11,530		3,550
Citizens		20,039		20,937		18,096		-4	%		11	%		17,851		2,188
First Bank - MT		9,818		10,003		11,231		-2	%		-13	%		8,515		1,303
San Juans		30,153		22,811		25,574		32	%		18	%		28,804		1,349
Total	$	850,875		854,087		855,126		0	%		0	%		744,277		106,598

	Commercial Real Estate Loans by Bank, by Type						% Change			% Change			Owner		Non-Owner
	Balance		Balance		Balance		from			from			Occupied		Occupied
	6/30/2010		12/31/2009		6/30/2009		12/31/2009			6/30/2009			6/30/2010		6/30/2010
Glacier	$	230,976		232,552		221,505		-1	%		4	%		115,525		115,451
Mountain West		222,414		230,383		199,589		-3	%		11	%		147,120		75,294
First Security		221,257		224,425		208,907		-1	%		6	%		146,676		74,581
1st Bank		64,158		64,008		69,999		0	%		-8	%		46,997		17,161
Western		105,377		107,173		103,434		-2	%		2	%		54,219		51,158
Big Sky		86,114		82,303		80,069		5	%		8	%		55,483		30,631
Valley		51,239		48,144		47,291		6	%		8	%		33,950		17,289
First National		28,808		26,703		-		8	%		n/m			22,713		6,095
Citizens		58,507		55,660		53,425		5	%		10	%		44,609		13,898
First Bank - MT		17,254		18,827		17,057		-8	%		1	%		11,276		5,978
San Juans		52,423		47,838		55,952		10	%		-6	%		28,321		24,102
Total	$	1,138,527		1,138,016		1,057,228		0	%		8	%		706,889		431,638

	Consumer Loans by Bank, by Type						% Change			% Change			Home Equity		Other
	Balance		Balance		Balance		from			from			Line of Credit		Consumer
	6/30/2010		12/31/2009		6/30/2009		12/31/2009			6/30/2009			6/30/2010		6/30/2010
Glacier	$	158,088		162,723		161,048		-3	%		-2	%		142,223		15,865
Mountain West		72,284		71,702		71,042		1	%		2	%		62,744		9,540
First Security		77,140		78,345		80,574		-2	%		-4	%		50,333		26,807
1st Bank		41,985		46,455		46,583		-10	%		-10	%		16,322		25,663
Western		46,001		48,946		50,384		-6	%		-9	%		31,970		14,031
Big Sky		28,475		28,903		28,882		-1	%		-1	%		25,191		3,284
Valley		24,445		24,625		25,798		-1	%		-5	%		15,248		9,197
First National		26,263		27,320		-		-4	%		n/m			16,772		9,491
Citizens		30,613		29,253		28,958		5	%		6	%		24,113		6,500
First Bank - MT		7,834		7,650		5,920		2	%		32	%		3,847		3,987
San Juans		14,463		14,189		14,618		2	%		-1	%		13,215		1,248
Total	$	527,591		540,111		513,807		-2	%		3	%		401,978		125,613

n/m - not measurable

Glacier Bancorp, Inc.

Credit Quality Summary

(Unaudited - $ in thousands)

							Non-		Accruing		Other
	Non-Performing Assets, by Loan Type						Accruing		Loans 90 Days or		Real Estate
	Balance		Balance		Balance		Loans		More Overdue		Owned
	6/30/2010		12/31/2009		6/30/2009		6/30/2010		6/30/2010		6/30/2010
Custom & owner occupied construction	$	2,448		3,281		1,929		1,200		-		1,248
Pre-sold & spec construction		21,486		29,580		31,879		18,612		196		2,678
Land development		84,632		88,488		52,583		58,696		-		25,936
Consumer land or lots		12,475		10,120		7,696		8,059		307		4,109
Unimproved land		36,211		32,453		24,212		19,679		505		16,027
Developed lots for operative builders		9,788		11,565		5,690		7,609		-		2,179
Commercial lots		1,481		909		223		1,445		-		36
Other construction		3,485		-		20		3,485		-		-
Commercial real estate		35,354		32,300		14,561		29,280		927		5,147
Commercial & industrial		11,645		12,271		7,523		11,311		313		21
Agriculture loans		5,744		283		572		5,327		12		405
Municipal loans		-		-		-		-		-		-
1-4 Family		26,648		30,868		20,953		20,198		607		5,843
Home equity line of credits		5,453		6,234		4,730		4,805		100		548
Consumer		651		1,042		940		346		63		242
Other		286		1,744		361		286		-		-
Total	$	257,787		261,138		173,872		190,338		3,030		64,419

									Non-Accrual &
	Accruing 30-89 Days Delinquent Loans and						Accruing		Accruing Loans		Other
	Non-Performing Assets, by Bank						30-89 Days		90 Days or		Real Estate
	Balance		Balance		Balance		Overdue		More Overdue		Owned
	6/30/2010		12/31/2009		6/30/2009		6/30/2010		6/30/2010		6/30/2010
Glacier	$	75,527		97,666		72,590		5,615		64,436		5,476
Mountain West		68,613		109,187		51,813		2,870		63,583		2,160
First Security		57,039		59,351		48,267		14,167		29,703		13,169
1st Bank		19,833		21,117		20,642		3,799		5,209		10,825
Western		5,757		9,315		6,972		666		1,175		3,916
Big Sky		26,854		31,711		24,769		4,064		14,778		8,012
Valley		2,131		2,542		1,547		637		1,212		282
First National		10,135		9,290		-		1,167		8,968		-
Citizens		5,625		5,340		7,319		1,670		2,180		1,775
First Bank - MT		554		800		265		126		324		104
San Juans		3,902		2,310		2,325		1,706		1,800		396
GORE		18,304		-		-		-		-		18,304
Total	$	294,274		348,629		236,509		36,487		193,368		64,419

									Provision for
							Provision for		the Year-to-Date		ALLL
	Allowance for Loan and Lease Losses						Year-to-Date		Ended 6/30/10		as a Percent
	Balance		Balance		Balance		Ended		Over Net		of Loans
	6/30/2010		12/31/2009		6/30/2009		6/30/2010		Charge-Offs		6/30/2010
Glacier	$	37,817		38,978		28,765		15,300		0.9		4.23	%
Mountain West		30,832		37,551		20,406		9,500		0.6		3.36	%
First Security		20,252		18,242		13,078		4,400		1.8		3.51	%
1st Bank		11,351		10,895		8,171		1,450		1.5		4.00	%
Western		8,707		8,762		7,046		550		0.9		2.75	%
Big Sky		11,511		10,536		6,852		2,900		1.5		4.32	%
Valley		4,707		4,367		4,047		450		4.1		2.42	%
First National		2,565		1,679		-		1,241		3.5		1.68	%
Citizens		6,120		4,865		3,647		1,500		6.1		3.63	%
First Bank - MT		3,067		2,904		2,405		265		2.6		2.62	%
San Juans		4,736		4,148		2,957		600		50.0		3.21	%
Total	$	141,665		142,927		97,374		38,156		1.0		3.51	%

Glacier Bancorp, Inc.

Credit Quality Summary (continued)

(Unaudited - $ in thousands)

	Net Charge-Offs, Year-to-Date Period Ending, By Bank						Charge-Offs		Recoveries
	6/30/2010		12/31/2009		6/30/2009		6/30/2010		6/30/2010
Glacier	$	16,461		12,012		2,725		16,796		335
Mountain West		16,219		28,931		7,576		16,586		367
First Security		2,390		3,745		834		3,248		858
1st Bank		994		5,917		4,641		1,400		406
Western		605		1,500		1,416		682		77
Big Sky		1,925		4,896		2,580		1,981		56
Valley		110		414		134		117		7
First National		355		4		-		358		3
Citizens		245		656		174		250		5
First Bank - MT		102		26		-		104		2
San Juans		12		329		140		62		50
Total	$	39,418		58,430		20,220		41,584		2,166

	Net Charge-Offs (Recoveries), Year-to-Date
	Period Ending, By Loan Type							Charge-Offs		Recoveries
	6/30/2010			12/31/2009		6/30/2009		6/30/2010		6/30/2010
Residential construction	$	4,228			13,455		3,536		4,324		96
Land, lot and other construction		21,077			28,310		11,561		22,001		924
Commercial real estate		3,267			1,187		513		3,396		129
Commercial and industrial		3,192			3,610		1,396		3,744		552
1-4 Family		4,998			7,242		1,960		5,218		220
Home equity lines of credit		2,302			2,357		581		2,324		22
Consumer		393			1,895		647		559		166
Other		(39	)		374		26		18		57
Total	$	39,418			58,430		20,220		41,584		2,166