October 2006

PRIVACY NOTICE

From the time it was founded, Westsound Bank has always valued its customers’ privacy highly.  We have protected your confidential information in many ways and will continue to do so using state-of-the-art measures.  We never lose sight of the fact that our customers’ trust is our most treasured asset.  You can rest easy knowing that our corporate focus is the protection of your privacy in your dealings with us.  When the new law took effect, we did not have to make any changes to our policy or practices to be fully in compliance.  If you ever have any questions about the confidentiality of your information in our hands, please contact Roy Johnston, Compliance Officer at (360) 475-9057.  Every day, we appreciate your business.  Thank you for banking with us!

We collect nonpublic personal information* about you and our former customers from the following sources:

• Information we receive from you on applications or other forms.
• Information that we receive from processing your accounts with us and the transactions in those accounts, such as deposit accounts and loans, as well as information that we receive from providing services to you, such as funds transfer services.
• Information we receive from a Consumer Reporting Agency (commonly known as a credit bureau).
• Information that we receive in response to requests we make to third parties about you or to confirm information that you have provided to us, particularly in the process of evaluating applications for loans.

We may disclose the following kinds of nonpublic personal information* about you and our former customers:

• We may disclose information that we receive from you on an application such as your assets, liabilities, income and employment history [for example, in order to determine whether a loan that you have applied for is saleable in the secondary marked (when we are unable to grant the request)].
• We may disclose information that we have received from you on an application such as deposits or loans that you have with other financial institutions, or your employment (for example, in order to verify the accuracy of the information that you have provided us).
• We may disclose information that we receive from you on an application such as existing loan balances to be paid from our loan proceeds (for example, to persons who will be involved in the closing of the loan, such as attorneys and title companies).
• We may disclose information that we receive from processing your accounts with us, such as balance information (for example, to the operator of the interchange that processes our ATM, Debit Card, Merchant, Internet Banking and Credit Card transactions).
• We may disclose information as permitted by law.

We may disclose all of the information we collect, as described above, to our affiliates or to companies that perform marketing services on our behalf or to other financial institutions with whom we have joint marketing agreements.

CONFIDENTIALLITY, SECURITY AND INTEGRITY

The Bank’s automation systems have a complex set of passwords, user identifications and terminal identifications that limits each employee’s access to information in the systems to that information that he or she requires to properly carry out his or her job responsibility.

*Nonpublic personal information means information about you that we collect in connection with providing a financial product or service to you.  Nonpublic personal information does not include information that is available from public sources, such as telephone directories or government records.