##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
 Form 10-K
   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31,
    2010ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934   Commission File Number:
    001-33803
 WESTERN LIBERTY
    BANCORP
 (Exact name of registrant as
    specified in its charter)
   Delaware(State of
    incorporation)

26-0469120(I.R.S. Employer
    Identification No.)8363 W. Sunset Road, Suite 350
    Las Vegas, Nevada(Address of principal
    executive offices)

89113(Zip
    code)   Registrants telephone number, including area code:
 (702) 966-7400
  Securities registered pursuant to section 12(b) of the
    Act:
 Common Stock, $0.0001 Par Value Per Share
  Securities registered pursuant to section 12(g) of the
    Act:
 None
  o þ
  o þ
  þ o
  Regulation S-T þ o
  Regulation S-K o
  Rule 12b-2
  Large accelerated
    filer o

Accelerated
    filer o

Non-accelerated
    filer o
    (Do not check if a smaller reporting company)

Smaller reporting
    company þ   Rule 12b-2 o þ




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##### 





WESTERN
    LIBERTY BANCORPFORM 10-K
    TABLE OF CONTENTS
   
 PagePART IItem 1

Business


3Item 1A

Risk Factors


27Item 1B

Unresolved Staff Comments


39Item 2

Properties


40Item 3

Legal Proceedings


40Item 4

[reserved]


40PART IIItem 5

Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


40Item 6

Selected Financial Data


42Item 7

Managements Discussion and Analysis of
    Financial Condition and Results of Operations


44Item 7A

Quantitative and Qualitative Disclosures About
    Market Risk


103Item 8

Financial Statements and Supplementary Data


103Item 9

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


103Item 9A

Controls and Procedures


103Item 9B

Other Information


104PART IIIItem 10

Directors, Executive Officers and Corporate
    Governance


104Item 11

Executive Compensation


106Item 12

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


106Item 13

Certain Relationships and Related Transactions
    and Director Independence


107Item 14

Principal Accountant Fees and Services


107PART IVItem 15

Exhibits and Financial Statement Schedules


107Signatures


189EX-14.1EX-21EX-31.1EX-31.2EX-32.1EX-32.2   2




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PART I  Item 1 
    Business  Western
    Liberty Bancorp
    Service1st
    Bank of Nevada
    The
    Acquisition
       3




---



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4




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##### Table of Contents



Presentation
  Form 10-K
 5




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Market
    Area and Competition
      Lending
    Activities
    Commercial real estate loans
 6




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Construction, land development, and other land
    loans
  Commercial and industrial loans
  
    working capital loans and lines of credit,
    business term loans, and
    inventory and accounts receivable financing.  Residential real estate loans
  Consumer loans
    ($ in thousands)

December 31, 2010Loans secured by real estate:Construction, land development and other land loans

$
5,923



5.58
%Commercial real estate


54,975



51.75
%Residential


9,247



8.71
%Total loans secured by real estate


70,145



66.04
%Commercial and industrial


35,946



33.84
%Consumer


131



0.12
%Gross loans


106,222



100.00
%Net deferred loan costs


37Gross loans, net of deferred costs


106,259Less: Allowance for loan losses


(36
)Net loans

$
106,223   Business Combinations
 7




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##### Table of Contents



For the Year Ended December 31, 2010Due Within


Due 1-5


Due OverOne Year


Years


Five Years


TotalLoans secured by real estate:Construction, land development and other land loans

$
4,428


$
1,495


$



$
5,923Commercial real estate


2,544



29,327



23,104



54,975Residential real estate (1 to 4 family)


6,885



2,222



140



9,247Total real estate-secured loans

$
13,857


$
33,044


$
23,244


$
70,145Loans not secured by real estate:Commercial and industrial


18,975



9,297



7,674



35,946Consumer


95



35



1



131Loans, Gross

$
32,927


$
42,376


$
30,919


$
106,222Interest rates:Fixed

$
7,429


$
33,867


$
5,713


$
47,009Variable


25,498



8,509



25,206



59,213Loans, Gross

$
32,927


$
42,376


$
30,919


$
106,222   Credit
    Policies and Administration
     8




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Allowance
    for Loan Losses
     9




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
    general economic and business conditions affecting key lending
    areas,
    credit quality trends, including trends in nonperforming loans
    expected to result from existing conditions,
    collateral values,
    loan volumes and concentrations,
    age of the loan portfolio,
    specific industry conditions within portfolio segments,
    the allowance for loan losses at peer institutions, and
    duration of the current business cycle.       10




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Non-performing
    Assets
     11




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##### Table of Contents



($s in thousands)

At December 31, 2010Nonaccrual loans:Loans secured by real estate construction, land development and
    other land loans

$
2,632Commercial real estate


1,224Residential real estate (1-4 family)


2,900Total loans secured by real estate


6,756Commercial and industrial


3,670Consumer


0Total non-accrual loans


10,426Past due (>90 days) loans and accruing interest:Loans secured by real estate construction, land development and
    other land loans

$
0Commercial real estate


0Residential real estate (1-4 family)


0Total loans secured by real estate


0Commercial and industrial


0Consumer


0Total past due loans accruing interest


0Restructure loans (still on accrual)


0Total non-performing loans

$
10,426Other real estate owned (OREO)


3,406Total non-performing assets

$
13,832Non-performing loans as a percentage of total portfolio loans


9.81
%Non-performing loans as a percentage of total assets


4.05
%Non-performing assets as a percentage of total assets


5.37
%Allowance for loan losses as a percentage of non-performing loans


0.35
%     (1)
    
    As of December 31, 2010 there were no originations from
    October 28, 2010 through December 31, 2010 that were
    considered non-performing.  Investment
    Activities
      
    cash and cash equivalents, which consists of cash and amounts
    due from banks, federal funds sold and certificates of deposits
    with original maturities of three months or less,
    longer term investment securities issued by companies rated
    A or better, 12




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
    securities backed by the full faith and credit of the
    U.S. government, including U.S. government agency
    securities,
    direct obligations of Ginnie Mae,
    mortgage-backed securities or collateralized mortgage
    obligations issued by a government-sponsored enterprise such as
    Fannie Mae, Freddie Mac, or Ginnie Mae, and
    mandatory purchases of equity securities from the Federal Home
    Loan Bank.    At December 31, 2010Gross


GrossAmortized


Unrealized


UnrealizedSecurities Available for Sale

Cost


Gains


Losses


Fair ValueCollateralized Mortgage Obligation Securities-Commercial

$
1,819


$
0


$
0


$
1,819$
1,819


$
0


$
0


$
1,819   At December 31, 2010Gross


GrossAmortized


Unrecognized


UnrecognizedSecurities Held to Maturity

Cost


Gains


Losses


Fair ValueCorporate Debt Securities

$
4,663


$
0


$
(27
)

$
4,636SBA Loans Pools


651



0



0



651$
5,314


$
0


$
(27
)

$
5,287     available-for-sale held-to-maturity. Available-for-sale Held-to-maturity
    Deposits
    products and other banking services
   13




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At December 31, 2010($s in thousands)

Amount


% of totalNon-interest bearing deposits

$
67,087



41.85
%Interest bearing deposits


31,837



19.86
%Money markets


24,672



15.39
%Savings


1,273



0.79
%Time deposits under $100,000


4,919



3.07
%Time deposits $100,000 and over


30,498



19.03
%Total deposits

$
160,286



100.00
%     Certificates
    of Deposit Maturities >$100 thousand
  ($s in thousands)

December 31, 2010Three months or less

$
1,671Over three months to six months


3,504Over six months to twelve months


25,323Over 12 months


0Total

$
30,498   Employees
    Supervision
    and Regulation
    Holding
    companies
     14




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
    acquire ownership or control of any voting shares of another
    bank or bank holding company, if after the acquisition the
    acquiring company would own or control more than 5% of the
    shares of the other bank or bank holding company (unless the
    acquiring company already owns or controls a majority of the
    shares),
    acquire all or substantially all of the assets of another
    bank, or
    merge or consolidate with another bank holding company.     15




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et seq
  Banks
    cease-and-desist
 16




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Capital:
    Regulatory capital guidelines
        Prompt
    corrective action
   17




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Deposit
    insurance
     18




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Dividends
    and distributions
          Transactions
    with affiliates
   19




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
    limit the extent to which a bank or its subsidiaries may lend to
    or engage in various other kinds of transactions with any one
    affiliate to an amount equal to 10% of the institutions
    capital and surplus, limiting the aggregate of covered
    transactions with all affiliates to 20% of capital and surplus,
    impose strict collateral requirements on loans or extensions of
    credit by a bank to an affiliate,
    impose restrictions on investments by a subsidiary bank in the
    stock or securities of its holding company,
    impose restrictions on the use of a holding companys stock
    as collateral for loans by the subsidiary bank, and
    require that affiliate transactions be on terms substantially
    the same as those provided to a non-affiliate.  Loans
    to insiders
  cease-and-desist
  Loans
    to one borrower
    Guidance
    concerning commercial real estate lending
     20




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
    total reported loans for construction, land development, and
    other land represent 100% or more of the institutions
    total capital, or
    total commercial real estate loans represent 300% or more of the
    institutions total capital and the outstanding balance of
    the institutions commercial real estate loan portfolio has
    increased by 50% or more during the prior 36 months.    Guidance
    concerning subprime lending
    Guidance
    concerning newly organized banks
    Interstate
    banking and branching
  de novo de novo out-of-state de novo out-of-state de novo
 21




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Consumer
    protection laws and regulations
    Community
    Reinvestment Act
    Equal
    Credit Opportunity Act
    Truth
    in Lending Act
    Fair
    Housing Act
    Home
    Mortgage Disclosure Act
   22




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Real
    Estate Settlement Procedures Act
    Privacy
    Predatory
    lending
    
    making unaffordable loans based on a borrowers assets
    rather than the consumers ability to repay an obligation,
    inducing a consumer to refinance a loan repeatedly in order to
    charge high points and fees each time the loan is refinanced, or
    loan flipping, and
    engaging in fraud or deception to conceal the true nature of the
    loan obligation from an unsuspecting or unsophisticated consumer.    
    interest rates for first lien mortgage loans more than eight
    percentage points above the yield on U.S. Treasury
    securities having a comparable maturity,
    interest rates for subordinate lien mortgage loans more than
    10 percentage points above the yield on U.S. Treasury
    securities having a comparable maturity, or
    total points and fees paid in the credit transaction exceed the
    greater of either 8% of the loan amount or a specified dollar
    amount that is inflation-adjusted each year.  ®
  
    Prohibit creditors from extending credit without regard to a
    consumers ability to repay from sources other than the
    collateral itself, 23




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
    Require creditors to verify income and assets relied upon to
    determine repayment ability,
    Prohibit prepayment penalties except under certain
    conditions, and
    Require creditors to establish escrow accounts for taxes and
    insurance in the case of first-lien higher-priced mortgage
    loans, but permit creditors to allow borrowers to cancel escrows
    12 months after loan consummation.  Corporate
    governance and accounting legislation
    Anti-money
    laundering and anti-terrorism legislation
        Monetary
    policy
   24




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Developments
    affecting management and corporate governance
    
    incentive compensation arrangements should provide employees
    incentives that appropriately balance risk and financial results
    in a manner that does not encourage employees to expose the
    organization to imprudent risk,
    these arrangements should be compatible with effective controls
    and risk management, and
    these arrangements should be supported by strong corporate
    governance, including active and effective oversight by the
    board of directors.       25




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Recent
    initiatives
      
    section 111 establishes a new Financial Stability Oversight
    Counsel to monitor systemic financial risks. The Board of
    Governors of the Federal Reserve is given extensive new
    authorities to impose strict controls on large bank holding
    companies with total consolidated assets equal to or in excess
    of $50 billion and systemically significant non-bank
    financial companies to limit the risk they might pose for the
    economy and to other large interconnected companies. The
    Dodd-Frank Act also grants to the Treasury Department, FDIC and
    the FRB broad new powers to seize, close and wind-down too
    big to fail financial institutions (including non-bank
    institutions) in an orderly fashion.
    Title X establishes a new independent Federal regulatory
    body within the Federal Reserve System that is dedicated
    exclusively to consumer protection. Known as the Bureau of
    Consumer Financial Protection, this new regulatory body will
    assume responsibility for most consumer protection laws, with
    rulemaking, supervisory, examination, and enforcement authority.
    It will also be in charge of setting appropriate consumer
    banking fees and caps. According to Dodd-Frank Act
    section 1025, the new regulatory body has examination and
    enforcement authority over banks with more than $10 billion
    in assets, but section 1026 makes clear that banks with
    assets of $10 billion or less will continue to be examined
    by their bank regulators for consumer law compliance. In
    addition, the Dodd-Frank Act permits states to adopt consumer
    protection laws and regulations that are stricter than those
    regulations promulgated by the Consumer Financial Protection
    Bureau. Although our bank does not currently offer many of these
    consumer products or services, compliance with any such new
    regulations would increase our cost of operations and, as a
    result, could limit our ability to expand into these products
    and services,
    section 171 restricts the amount of trust preferred
    securities that may be considered Tier 1 capital. For
    depository institution holding companies with total assets of
    less than $15 billion, trust preferred securities issued
    before May 19, 2010 may continue to be included in
    Tier 1 capital, but future issuances of trust preferred
    securities will no longer be eligible for treatment as
    Tier 1 capital, and
    under section 334 the FDICs minimum reserve ratio is
    to be increased from 1.15% to 1.35%, with the goal of attaining
    that 1.35% level by September 30, 2020; however, financial
    institutions with assets of less than $10 billion,
    including Service1st, are to be exempt from the cost of the
    increase. FDIC insurance coverage of up to $250,000 for deposit
    accounts is made permanent by section 335, section 343
    extends until January 1, 2013 unlimited FDIC insurance for
    non-interest-bearing demand deposit accounts, more commonly
    known as checking accounts, and section 627 repeals the
    longstanding prohibition against financial institutions paying
    interest on checking accounts.
    Section 331 changes the way deposit insurance premiums are
    calculated by the FDIC as well. That is, deposit insurance
    premiums are calculated based upon an institutions
    so-called assessment base. Until 26




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the Dodd-Frank Act became law, the assessment base consisted of
    an institutions deposit liabilities. Section 331,
    however, makes clear that the assessment base shall now be the
    difference between total assets and tangible equity, so in other
    words the assessment base will take account of all liabilities,
    not merely deposit liabilities. This change is likely to have a
    greater impact on large banks, which tend to rely on a variety
    of funding sources, than on smaller community banks, which tend
    to rely primarily on deposit funding:  
    the Office of the Comptroller of the Currencys ability to
    preempt state consumer protection laws is constrained by
    section 1044, and because of section 1042 state
    attorneys general have greater authority to enforce state
    consumer protection laws against national banks and their
    operating subsidiaries,
    section 619 embodies the so-called Volcker
    rule, prohibiting a banking entity from engaging in
    proprietary trading or from sponsoring or investing in a hedge
    fund or private equity fund, and
    imposing a 5% risk retention requirement on securitizers of
    asset-backed securities, section 941 could have an impact
    on financial institutions that originate mortgages for sale into
    the secondary market. Like other provisions of the Dodd-Frank
    Act, the scope and impact of section 941 will be determined
    by future rulemaking.    Item 1A 
    Risk
    Factors  As a
    newly formed public bank holding company, we will incur
    significant legal, accounting, compliance and other
    expenses.
    Regulation S-X
  As the
    provider of financial services, our business and earnings are
    significantly affected by general business and economic
    conditions, particularly in the real estate industry, and
    accordingly, our business and earnings could be further harmed
    in the event of a continuation or deepening of the current
    U.S. recession or further market deterioration or
    disruption.
   27




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Our
    geographic concentration is tied to business, economic and
    regulatory conditions in Nevada.
      The
    Las Vegas market is substantially dependent on gaming and
    tourism revenue, and the downturn in the gaming and tourism
    industries has indirectly had an adverse impact on Nevada
    banks.
   28




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The
    soundness of other financial institutions with which we do
    business could adversely affect us.
  mark-to-market
  Our
    earnings may be significantly affected by the fiscal and
    monetary policies of the federal government and its
    agencies.
    If
    there was a depletion of the FDICs Deposit Insurance Fund,
    the FDIC could impose additional assessments on the banking
    industry.
  Supervision and
    Regulation  Deposit Insurance.
 29




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The
    financial services industry is heavily regulated by federal and
    state agencies.
  and/or Supervision and Regulation.
  We
    operate in a highly regulated environment and changes in the
    laws and regulations that govern our operations, changes in the
    accounting principles that are applicable to us, and our failure
    to comply with the foregoing, may adversely affect
    us.
  Supervision and
    Regulation.
    Any
    current or future litigation, regulatory investigations,
    proceedings, inquiries or changes could have a significant
    impact on the financial services industry.
  and/or
  The
    removal or reduction in stimulus activities sponsored by the
    Federal Government and its agents may have a negative impact on
    Service1sts results and operations.
    
    Target fed funds rates which have remained close to zero percent;
    Mortgage rates that have remained at historical lows in part due
    to the Federal Reserve Bank of New Yorks $1.25 trillion
    mortgage-backed securities purchase program; 30




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
    Bank funding that has remained stable through an increase in
    FDIC deposit insurance to a covered limit of $250,000 per
    account from the previous coverage limit of $100,000; and
    Housing demand that has been stimulated by homebuyer tax credits.    Current
    market volatility and industry developments may adversely affect
    business and financial results.
      Strategies
    to manage interest rate risk may yield results other than those
    anticipated.
    Negative
    public opinion could damage our reputation and adversely impact
    our business and revenues.
  and/or
  Material
    breaches in security of Service1sts systems may have a
    significant effect on Service1sts business.
     31




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Changes
    in interest rates could adversely affect our profitability,
    business and prospects.
        Increasing
    our existing market share may depend on market acceptance and
    regulatory approval of new products and services.
  and/or Bank regulatory restrictions with
    the FDIC and the Nevada Financial Institutions Division are
    likely to limit growth and new product development that were not
    in the business plan approved by bank regulators at the time
    Western Liberty Bancorp was approved to acquire
    Service1st Bank of Nevada.
 32




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The
    historical financial information included in this
    Form 10-K
    is not necessarily indicative of our future
    performance.
  Form 10-K
  Service1st
    has experienced significant losses since it began operations in
    January of 2007. There is no assurance that it will become
    profitable.
  start-up start-up
  and/or
  Further
    deterioration in the quality of our loan portfolio may result in
    additional charge-offs which will adversely affect our operating
    results.
  Managements Discussion & Analysis of
    Service1st Bank of Nevada  Financial Condition.
   33




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A
    substantial portion of our loan portfolio consists of loans
    maturing within one year, and there is no guarantee that these
    loans will be replaced upon maturity or renewed on the same
    terms or at all.
    We
    rely upon independent appraisals to determine the value of the
    real estate which secures a significant portion of
    Service1sts loans, and the values indicated by such
    appraisals may not be realizable if we are forced to foreclose
    upon such loans.
   34




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We
    currently are not permitted to expand by
    acquisition
    Bank
    regulatory restrictions with the FDIC and the Nevada Financial
    Institutions Division are likely to limit growth and new product
    development that were not in the business plan approved by bank
    regulators at the time Western Liberty Bancorp was approved to
    acquire Service1st Bank of Nevada.
      de
    novo
 35




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##### Table of Contents



de novo 12-month
    Service1st
    is subject to regulatory restrictions, including a Consent
    Order, that restricts its operations, affect its ability to
    obtain regulatory approval for future initiatives requiring such
    approval and to hire and retain qualified senior
    management.
  (MOU
     36




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Our
    stock price could fluctuate and could cause you to lose a
    significant part of your investment.
    
    changes in our perceived ability to increase our assets and
    deposits;
    changes in financial estimates by analysts;
    announcements by us or our competitors of significant contracts,
    productions, acquisitions or capital commitments;
    fluctuations in our quarterly financial results or the quarterly
    financial results of companies perceived to be similar to us;
    general economic conditions;
    changes in market valuations of similar companies;
    terrorist acts;
    changes in our capital structure, such as future issuances of
    securities or the incurrence of additional debt;
    future sales of our Common Stock;
    regulatory developments in the United States, foreign countries
    or both;
    litigation involving us, our subsidiaries or our general
    industry; and
    additions or departures of key personnel.  The
    trading volume of the Companys common stock is
    limited.
    If we
    are unable to effectively maintain a system of internal control
    over financial reporting, we may not be able to accurately or
    timely report financial results, which could materially
    adversely affect our business.
  Form 10-K
  Our
    allowance for loan losses may not be adequate to cover actual
    loan losses, which may require us to take a charge to our
    earnings and adversely impact our financial condition and
    results of operations.
   37




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held-for-investment
  If we
    are unable to recruit and retain experienced management
    personnel and recruit and retain additional qualified personnel,
    our business and prospects could be adversely
    affected.
        We are
    exposed to risk of environmental liabilities with respect to
    properties to which we take title.
  clean-up
 38




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Compliance
    with governmental regulations and changes in laws and
    regulations and risks from investigations and legal proceedings
    could be costly and could adversely affect operating
    results.
    The
    value of the Federal Home Loan Bank stock that we own could be
    adversely affected by weakness in the FHLB system.
  available-for-sale
  Our
    legal lending limit could be a competitive
    disadvantage.
    Item 1B 
    Unresolved
    Staff Comments   39




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Item 2 
    Properties    Item 3 
    Legal
    Proceedings    Item 4 
    [reserved] PART II  Item 5 
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities  Market information
  Units

Common stock

WarrantsHigh

Low

High

Low

High

Low2009First quarter

$
9.55


$
9.15


$
9.48


$
9.14


$
0.17


$
0.08Second quarter


9.76



9.48



9.69



9.44



0.23



0.09Third quarter


10.70



9.90



9.89



9.65



1.20



0.20Fourth quarter


10.30



7.75



9.83



6.42



1.20



0.552010First quarter


8.60



7.95



8.04



6.18



0.80



0.35Second quarter


7.50



7.00



9.00



5.75



0.45



0.22Third quarter


7.50



7.50



7.80



4.80



0.30



0.18Fourth quarter


7.50



7.50



7.80



4.80



0.30



0.18   Over-the-Counter
  Holders
    of Common Equity
    Dividends
   40




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Recent
    sales of unregistered securities
        x y
   41




---



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x y
    Issuer
    purchases of equity securities in the fourth
    quarter
    Item 6 
    Selected
    Financial Data  SELECTED
    HISTORICAL FINANCIAL INFORMATION  WESTERN LIBERTY
    BANCORP (WLBC)
  Form 10-K.
    Managements Discussion and Analysis of Financial
    Condition and Results of Operations  WLBC Form 10-K. Form 10-K
  Selected
    Financial Data of WLBC
  Form 10-K.
 42




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WESTERN
    LIBERTY BANCORP
    SELECTED FINANCIAL DATA
  Years Ended December 31,2010(3)


2009


2008($ in thousands except per share data)Selected Results of Operations Data:Interest income

$
1,530


$
139


$
5,691Interest expense


115







Net interest income


1,415



139



5,691Provision for loan losses


36







Net interest (loss) income after provision for loan losses


1,379



139



5,691Non-interest income


108







Non-interest expense


9,137



15,037



7,244Net Loss

$
(7,650
)

$
(14,898
)

$
(1,553
)Per Share data:Net loss per common share

$
(0.65
)

$
(0.45
)

$
(0.05
)Book Value(5)

$
6.22


$
8.02


$
5.34Selected Balance Sheet Data:Total Assets

$
257,546


$
88,520


$
318,395Cash and cash equivalents


103,227



87,969



1,446Certificates of deposit(4)


26,889







Securities, available for sale


1,819







Securities, held to maturity


5,314







Gross loans, including net deferred loan fees


106,259







Allowance for loan losses


36







Deposits


160,286







Stockholders equity


93,829



87,891



213,145Value of common stock which may be redeemed for cash










94,984Performance Ratios:Net interest margin(1)


3.33
%


N/A



N/AEfficiency ratio(2)


599.93
%


N/A



N/AReturn on average assets


(2.60
)%


N/A



N/AReturn on average equity


(5.89
)%


N/A



N/AAsset Quality:Nonperforming loans(6)

$
10,426


$
N/A


$
N/AAllowance for loan losses as a percentage of nonperforming
    loans(6)


0.35
%


N/A



N/AAllowance for loan losses as a percentage of portfolio loans


0.03
%


N/A



N/ANonperforming loans as a percentage of total portfolio loans(6)


9.81
%


N/A



N/ANonperforming loans as a percentage of total assets(6)


4.05
%


N/A



N/ANet charge-offs to average portfolio loans


0.00
%


N/A



N/ACapital Ratios:Average equity to average assets


44.11
%


68.73
%


67.11
%Tier 1 equity to average assets


30.5
%


N/A



N/ATier 1 Risk-Based Capital ratio


68.4
%


N/A



N/ATotal Risk-Based Capital ratio


68.8
%


N/A



N/A     (1)
    
    Net interest margin represents net interest income as a
    percentage of average interest-earning assets.(2)
    
    Efficiency ratio represents non-interest expenses as a
    percentage of the total of net interest income plus non-interest
    income. 43




---



##### Table of Contents



(3)
    
    Service1st was acquired in 100% stock exchange on
    October 28, 2010. Thus, the 2010 data represents a full
    year for WLBC and a partial year (two months) for Service1st.(4)
    
    Certificates of deposit issued by other banks with original
    maturities greater than three months.(5)
    
    Book value is calculated by dividing total stockholders
    equity at December 31 by the number of shares outstanding as of
    December 31.(6)
    
    Nonperforming loans includes PCI loans for which no contractual
    interest is being recorded. Item 7 
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
    AND RESULTS OF OPERATIONS  WESTERN LIBERTY
    BANCORP  Form 10-K. Cautionary Note Regarding
    Forward-Looking Statements
  Overview
  Business of WLBC:
  SBA
     44




---



##### Table of Contents



Form 10-K).
  Local Economic Conditions. , CBER
    Report The Applied Analysis, Las Vegas Market Reports
    (2nd quarter 2010)
  Summary
    of Results of Operations and Financial Condition
  start-up start-up
    Critical
    Accounting Policies and Estimates
  Form 10-K),
 45




---



##### Table of Contents



case-by-case
  Allowance
    for Loan Losses
         46




---



##### Table of Contents



Investment
    Securities Portfolio
      other-than-temporary
  Stock-Based
    Compensation
  Form 10-K.
  Income
    Taxes
   47




---



##### Table of Contents



Acquisition
    of Service1st Bank of Nevada
             48




---



##### Table of Contents



Results
    of Operations
         49




---



##### Table of Contents



Managements Discussion and
    Analysis of Financial Condition and Results of Operations of
    WLBC Quantitative and Qualitative Disclosures About
    Market Risk
    Year Ended December 31,


Year Ended December 31,


Year Ended December 31,2010(4)


2009


2008Interest








Interest








InterestAverage


Income/





Average


Income/





Average


Income/($ in thousands)

Balance


Expense


Yield


Balance


Expense


Yield


Balance


Expense


YieldInterest Earning Assets:Certificates of deposit


26,889


$
56



1.27
%

$
0


$
0



0.00
%

$
0


$
0



0.00
%Money Market funds


76,804



8



0.06
%


237,577



139



0.06
%


315,590



5,691



1.80
%Interest Bearing deposits


39,308



16



0.25
%


0



0



0.00
%


0



0



0.00
%Investment securities


7,898



47



3.62
%


0



0



0.00
%


0



0



0.00
%Portfolio loans(1)


107,275



1,403



7.96
%


0



0



0.00
%


0



0



0.00
%Total interest-earnings assets/interest income


258,174



1,530



3.61
%


237,577



139



0.06
%


315,590



5,691



1.80
%Noninterest Earning Assets:Cash and due from banks


12,035











22,294











2,060Allowance for loan losses


(18
)










0











0Other assets


13,243











218











144Total assets

$
283,434










$
260,089










$
317,794 50




---



##### Table of Contents



Year Ended December 31,


Year Ended December 31,


Year Ended December 31,2010(4)


2009


2008Interest








Interest








InterestAverage


Income/





Average


Income/





Average


Income/($ in thousands)

Balance


Expense


Yield


Balance


Expense


Yield


Balance


Expense


YieldLiabilities and Stockholders EquityInterest-Bearing Liabilities:Demand deposits


31,275



43



0.84
%


0



0



0.00
%


0



0



0.00
%Money markets


26,048



25



0.58
%


0



0



0.00
%


0



0



0.00
%Savings


1,272



1



0.48
%


0



0



0.00
%


0



0



0.00
%Time deposits under $100,000


4,910



7



0.87
%


0



0



0.00
%


0



0



0.00
%Time deposits $100,00 and over


29,943



39



0.79
%


0



0



0.00
%


0



0



0.00
%Repurchase Agreements










0.00
%


0



0



0.00
%


0



0



0.00
%Short-term borrowings










0.00
%










0.00
%


0







0.00
%Total interest-bearing liabilities/interest expense


93,448



115



0.75
%


0



0



0.00
%


0



0



0.00
%Noninterest Bearing Liabilities:Non-interest-bearing demand deposits


68,493











0











0Accrued interest on deposits and other liabilities


2,221











81,320











104,527Total liabilities


164,162











81,320











104,527Stockholders equity(5)


87,704











178,769











213,267Total liabilities and stockholders equity(6)

$
251,866










$
260,089










$
317,794Net interest income and Interest rate spread(2)





$
1,415



2.86
%





$
139



0.06
%





$
5,691



1.80
%Net interest margin(3)










3.33
%










0.06
%










1.80
%Ratio of Average Interest-Earning Assets to Interest-Bearing
    Liabilities


276
%










0.00
%










0.00
%     (1)
    
    Average balances include nonaccrual loans of approximately
    $10,426, $0, and $0 for the years ended December 31, 2010,
    2009 and 2008, respectively. Net loan (fees) or costs of
    $37,000, $0 and $0 are included in the yield computation for the
    years ended December 31, 2010, 2009 and 2008, respectively.(2)
    
    Net interest spread represents the average yield earned on
    interest earning assets less the average rate paid on interest
    bearing liabilities.(3)
    
    Net interest margin represents net interest income as a
    percentage of average interest earning assets.(4)
    
    Service1st was acquired by Western Liberty Bancorp on
    October 28, 2010, thus the 2010 data represents a full year
    for WLBC; and a partial year for Service1st, October 28,
    2010 through December 31, 2010. Average balances are
    computed by taking the balance at each quarter end for WLBC,
    adding the four quarters together and dividing by four. Average
    balances for Service1st are computed by taking November and
    December 2010s month end balance, adding them together and
    dividing by two. Interest income for 2010 represents a full year
    for WLBC and two months of income for Service1st.(5)
    
    Stockholders equity was computed by taking WLBCs balance
    for each quarter end, adding the four quarters together and
    dividing by four, to compute a yearly average. No balance for
    Service1st is included in the 2010 stockholders equity
    balance as the calculation combines four quarters of WLBCs
    balances to compute an average, but is skewed when only the last
    two months of Service1sts 2010 balances can be 51




---



##### Table of Contents



utilized, due to date of acquisition. Thus, the elimination of
    investment in subsidiary, which needs to occur in consolidation
    accounting, impacts the consolidated numbers.(6)
    
    As a result of the assumption noted in note (5) above,
    Total Assets will not equal Total Liabilities plus
    Stockholders Equity for 2010.    Year Ended December 31,2010 compared to Year Ended December 31, 2009Increase (Decrease)Due to Changes in:NetAverage


Average


Increase($s in thousands)

Volume


Rate


(Decrease)Interest income:Certificates of deposit

$
56


$
0


$
56Interest bearing deposits


(121
)


6



(115
)Federal funds sold


0



0



0Investment securities


47



0



47Portfolio loans


1,403



0



1,403Total increase (decrease) in interest income


1,385



6



1,391Interest expense:Interest checking

$
43


$
0


$
43Money markets


25



0



25Savings


1



0



1Time deposits under $100,000


7



0



7Time deposits $100,000 and over


39



0



39Repurchase Agreements


0



0



0Short-term borrowings


0



0



0Total increase (decrease) in interest expense


115



0



115Net increase (decrease) in net interest income

$
1,270


$
6


$
1,276   52




---



##### Table of Contents



Years Ended December 31,2009 Compared to 2008Increase (Decrease)Due to Changes in:NetAverage


Average


Increase($s In thousands)

Volume


Rate


(Decrease)Interest income:Certificates of deposit

$
0


$
0


$
0Interest bearing deposits


(46
)


(5,506
)


(5,552
)Federal funds sold


0



0



0Investment securities


0



0



0Portfolio loans


0



0



0Total increase (decrease) in interest income


(46
)


(5,506
)


(5,552
)Interest expense:Interest checking

$
0


$
0


$
0Money markets


0



0



0Savings


0



0



0Time deposits under $100,000


0



0



0Time deposits $100,000 and over


0



0



0Repurchase Agreements


0



0



0Short-term borrowings


0



0



0Total increase (decrease) in interest expense


0



0



0Net increase (decrease) in net interest income

$
(46
)

$
(5,506
)

$
(5,552
)   Comparison
    of 2010 with 2009
  $
   53




---



##### Table of Contents



Comparison
    of 2009 with 2008
      Provision
    for Loan Losses
     54




---



##### Table of Contents



Comparison
    of 2010 with 2009
                Comparison
    of 2009 with 2008
   55




---



##### Table of Contents



Non-Interest
    Income
    Comparison
    of 2010 with 2009
    Comparison
    of 2009 with 2008
    Non-Interest
    Expense
    Years Ended December 31,($ In thousands)

2010(1)


2009


2008Non-interest expenses:Salaries and employee benefits

$
1,461


$
72


$
83Occupancy, equipment and depreciation


269



0



0Computer service charges


51



0



0Federal deposit insurance


90



0



0Professional fees


3,851



12,612



0Advertising and business development


7



1



1,670Insurance


825



301



301Telephone


19



0



0Printing and supplies


314



748



6Stock based compensation


1,770



869



4,625Other


480



434



559Total non-interest expenses

$
9,137


$
15,037


$
7,244     (1)
    
    For the year January 1, 2010 through December 31, 2010
    for WLBC and for the two months ended 2010 for Service1st.  Comparison
    of 2010 with 2009
   56




---



##### Table of Contents



Comparison
    of 2009 with 2008
    Income
    Taxes
    Financial
    Condition
  Assets
    Cash
    and Cash Equivalents
    Investment
    Securities and Certificates of Deposits held at other
    Banks
       57




---



##### Table of Contents



available-for-sale available-for-sale Held-to-maturity
  For the Year Ended December 31, 2010Gross


GrossAmortized


Unrealized


Unrealized


Fair(Dollars in thousands)

Cost


Gains


Losses


ValueU.S. Government Agency Securities

$



$



$



$
Collateralized Mortgage Obligations-Commercial


1,819











1,819Total

$
1,819


$



$



$
1,819   For the Year Ended December 31, 2010Gross


GrossAmortized


Unrecognized


Unrecognized


Fair(Dollars in thousands)

Cost


Gains


Losses


ValueInvestments-Held to MaturityCorporate debt securities

$
4,663


$
0


$
(27
)

$
4,636SBA Loan Pools


651



0







651Total

$
5,314


$
0


$
(27
)

$
5,287     For the Year Ended December 31, 2010Due Under


Due1 Year


1-5 Years


Due 5-10 Years


Due Over 10 Years


TotalAmount/Yield


Amount/Yield


Amount/Yield


Amount/Yield


Amount/YieldAvailable for SaleU.S. Government Agency Securities

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%Corporate Debt Securities


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Collateralized Mortgage Obligations-Commercial


1,417



2.55
%


402



2.69
%


0



0.00
%


0



0.00
%


1,819



2.58
%Small Business Administration Loan Pools


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Total available for sale

$
1,417



2.55
%

$
402



2.69
%

$
0



0.00
%

$
0



0.00
%

$
1,819



2.58
%Held to MaturityU.S. Government Agency Securities

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%Corporate Debt Securities


3,075



7.17
%


1,561



7.00
%


0



0.00
%


0



0.00
%


4,636



7.11
%Collateralized Mortgage Obligations-Commercial


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Small Business Administration Loan Pools


5



3.00
%


14



4.33
%


99



2.57
%


534



2.76
%


651



2.77
%Total held to maturity

$
3,080



7.16
%

$
1,575



6.98
%

$
99



2.57
%

$
534



2.76
%

$
5,287



6.57
%  58




---



##### Table of Contents



Loans
      ($ in thousands)

December 31, 2010Loans secured by real estate:Construction, land development and other land loans

$
5,923



5.58
%Commercial real estate


54,975



51.75
%Residential


9,247



8.71
%Total loans secured by real estate


70,145



66.04
%Commercial and industrial


35,946



33.84
%Consumer


131



0.12
%Gross loans


106,222



100.00
%Net deferred loan costs


37Gross loans, net of deferred costs


106,259Less: Allowance for loan losses


(36
)Net loans

$
106,223      59




---



##### Table of Contents



For the Year Ended December 31, 2010Due Within


Due 1-5


Due OverOne Year


Years


Five Years


TotalLoans secured by real estate:Construction, land development and other land loans

$
4,428


$
1,495


$



$
5,923Commercial real estate


2,544



29,327



23,104



54,975Residential real estate (1 to 4 family)


6,885



2,222



140



9,247Total real estate-secured loans

$
13,857


$
33,044


$
23,244


$
70,145Loans not secured by real estate:Commercial and industrial


18,975



9,297



7,674



35,946Consumer


95



35



1



131Loans, Gross

$
32,927


$
42,376


$
30,919


$
106,222Interest rates:Fixed

$
7,429


$
33,867


$
5,713


$
47,009Variable


25,498



8,509



25,206



59,213Loans, Gross

$
32,927


$
42,376


$
30,919


$
106,222   Concentrations
    Interest
    Reserves
  and/or and/or
  Nonperforming
    Assets
     60




---



##### Table of Contents



For the Year Ended($s in thousands)

December 31, 2010Nonaccrual loans:Loans Secured by Real EstateConstruction, land development and other land loans

$
2,632Commercial real estate


1,224Residential real estate (1-4 family)


2,900Total loans secured by real estate


6,756Commercial and industrial


3,670Consumer


0Total nonaccrual loans


10,426Past due (>90days) loans and accruing interest:Loans Secured by Real EstateConstruction, land development and other land loans

$
0Commercial real estate


0Residential real estate (1-4 family)


0Total loans secured by real estate


0Commercial and industrial


0Consumer


0Total past due loans accruing interest


0Restructured loans (still on accrual)(1)


0Total nonperforming loans

$
10,426Other real estate owned (OREO)


3,406Total nonperforming assets

$
13,832Non-Performing Loans as a percentage of total portfolio loans


9.81
%Non-Performing assets as a percentage of total assets


4.05
%Non-Performing assets as a percentage of total assets


5.37
%Allowance for loan losses as a percentage of nonperforming loans


0.35
%     (1)
    
    For the year ended December 31, 2010, WLBC had
    approximately $5.9 million in loans classified as
    restructured loans. All of such loans were on nonaccrual.   61




---



##### Table of Contents



Potential
    Problem Loans
    For the Year Ended December 31, 2010# of


Loan





Percent ofLoans


Balance


%


Total LoansConstruction, land development and other land loans


3


$
1,997



16.12
%


1.88
%Commercial real estate


5



6,042



48.78
%


5.69
%Residential real estate (1-4 family)


1



2,357



19.03
%


2.22
%Commercial and industrial


15



1,990



16.07
%


1.87
%Consumer


0



0



0.00
%


0.00
%Total Loans


24


$
12,386



100
%


11.66
%     Impaired
    Loans
     62




---



##### Table of Contents



For the Year Ended December 31, 2010Impaired





Percent of


Reserve





Percent of Total($ in thousands)

Balance


%


Total Loans


Balance


%


AllowanceConstruction, land development and other land loans

$
3,220



28.15
%


3.03
%

$
0



0.00
%


0.00
%Commercial real estate


1,648



14.41
%


1.55
%


0



0.00
%


0.00
%Residential real estate (1-4 family)


2,900



25.35
%


2.73
%


0



0.00
%


0.00
%Commercial and industrial


3,670



32.09
%


3.46
%


0



0.00
%


0.00
%Consumer


0



0.00
%


0.00
%


0



0.00
%


0.00
%Total impaired loans

$
11,438



100.00
%


10.77
%

$
0



0.00
%


0.00
%    63




---



##### Table of Contents



Allowance
    for Loan Losses
    Analysis
    of loss experience by loan type
  For the Year Ended($s in thousands)

December 31, 2010Allowance for Loan and Lease Loss:Balance at the beginning of the year

$
0Provisions charged to operating expenses


36Recoveries of loans previously charged off:Construction, land development and other land loans


0Commercial real estate


0Residential real estate (1-4 family)


0Commercial and industrial


0Consumer


0Total recoveries


0Loans charged-off:Construction, land development and other


0Commercial


0Residential (including multi-family)


0Commercial and industrial


0Consumer


0Total charged-off


0Net charge-offs


0Balance at end of year

$
36Net Charge-offs to average loans outstanding


0.00
%Allowance for Loan Loss to outstanding loans


0.03
%        64




---



##### Table of Contents



clean-up
  and/or
 65




---



##### Table of Contents



For the Year Ended December 31, 2010($s in thousands)

Amount


% of loansAllowance for Loan and Lease Loss:Loans Secured by Real EstateConstruction, land development and other land loans

$
0



5.58
%Commercial real estate


0



51.75
%Residential real estate (1-4 family)


0



8.71
%Total loans secured by real estate


0



66.04
%Commercial and industrial


36



33.84
%Consumer


0



0.12
%Total allowance for loan loss


36



100
%     Deferred
    Tax Asset
      Deposits
     66




---



##### Table of Contents



December 31, 2010($s in thousands)

Amount


% of TotalNon-interest-bearing deposits

$
67,087



41.85
%Interest-bearing deposits


31,837



19.86
%Money Markets


24,672



15.39
%Savings


1,273



0.79
%Time deposits under $100,000


4,919



3.07
%Time deposits $100,000 and over


30,498



19.03
%Total Deposits

$
160,286



100.00
%     Certificates
    of Deposit Maturities > $100,000
  ($s in thousands)

AmountThree months or less

$
1,671Over three months to six months


3,504Over six months to twelve months


25,323Over 12 months


0Total

$
30,498   Capital
    Resources
    and/or
   67




---



##### Table of Contents



de novo
  To Be WellCapitalizedUnderRegulatoryCapital Ratios:

WLBC

Service1st

AgreementTier 1 equity to average assets


30.5
%


18.1
%


10.0
%Tier 1 risk-based capital ratio


68.4
%


30.6
%


6.0
%Total risk-based capital ratio


68.8
%


31.0
%


12.0
%     Liquidity
    and Asset/Liability Management
     68




---



##### Table of Contents



Off-Balance
    Sheet Arrangements
    At December 31,2010

2009

2008($ in thousands)Commitments to extend credit

$
18,504



0



0Standby commercial letters of credit


590



0



0       Contractual
    Obligations
    Payments Due by Year($s in thousands)




Less Than


1-3


3-5


AfterContractual Obligations

Total


1 Year


Years


Years


5 YearsLong Term Borrowed Funds

$
0


$
0


$
0


$
0


$
0Capital Lease Obligations


0



0



0



0



0Operating Lease Obligations


2,096



910



1,186



0



0Purchase Obligations


0



0



0



0



0Other Long Term Liabilities


0



0



0



0



0$
2,096


$
910


$
1,186


$
0


$
0   Quantitative
    and Qualitative Disclosures About Market Risk
  and/or
 69




---



##### Table of Contents



day-to-day
     70




---



##### Table of Contents



December 31,
    2010
    Sensitivity of Net Interest Income
  PercentageAdjusted Net


ChangeInterest Rate Scenario

Interest Income


from Base(Dollars in thousands)Up 300 basis points

$
10,749



5.25
%Up 200 basis points


10,559



3.39
%Up 100 basis points


10,374



1.58
%BASE


10,213



0.00
%Down 100 basis points


10,069



−1.41
%Down 200 basis points


9,637



−5.63
%   SELECTED
    HISTORICAL FINANCIAL INFORMATION  SERVICE1ST BANK OF
    NEVADA
  Form 10-K.
  Managements Discussion and Analysis of Financial
    Condition and Results of
    Operations-Service1st Bank of Nevada Form 10-K. Form 10-K
  Selected
    Financial Data of Service1st
  Form 10-K.
  SERVICE1ST
    BANK OF NEVADA
    SELECTED FINANCIAL DATA
  Period Ended October 28, 2010 and Years Ended 2009 and
    20082010(3)


2009


2008($ in thousands except per share data)Selected Results of Operations Data:Interest income

$
6,620


$
9,043


$
8,497Interest expense


1,147



2,676



2,022Net interest income


5,473



6,367



6,475Provision for loan losses


6,329



15,666



3,670Net interest (loss) income after provision for loan losses


(856
)


(9,299
)


2,805Non-interest income


507



514



341Non-interest expense


8,368



8,593



8,263Net Loss

$
(8,717
)

$
(17,378
)

$
(5,117
)Per Share data:Net loss per common share

$
(175.00
)

$
(342.86
)

$
(100.70
)Book Value

$
330.01


$
492.24


$
832.80 71




---



##### Table of Contents



Period Ended October 28, 2010 and Years Ended 2009 and
    20082010(3)


2009


2008($ in thousands except per share data)Selected Balance Sheet Data:Total Assets

$
179,956


$
211,760


$
159,494Cash and cash equivalents


15,091



49,633



9,987Certificates of deposit(4)


31,928



9,313



0Investment securities


10,432



17,635



11,740Gross loans, including net deferred loan fees


125,404



136,967



137,216Allowance for loan losses


9,418



6,404



2,883Deposits


162,066



185,320



109,891Stockholders equity


16,438



24,519



42,316Performance Ratios:Net interest margin(1)


3.24
%


3.22
%


4.59
%Efficiency ratio(2)


139.93
%


124.88
%


121.25
%Return on average assets


(4.98
)%


(8.48
)%


(3.52
)%Return on average equity


(46.72
)%


(43.24
)%


(11.12
)%Asset Quality:Nonperforming loans

$
20,326


$
7,799


$
3,434Allowance for loan losses as a percentage of nonperforming loans


46.34
%


82.11
%


83.95
%Allowance for loan losses as a percentage of portfolio loans


7.51
%


4.68
%


2.10
%Nonperforming loans as a percentage of total portfolio loans


16.21
%


5.69
%


2.50
%Nonperforming loans as a percentage of total assets


12.63
%


3.68
%


2.15
%Net charge-offs to average portfolio loans


2.54
%


8.43
%


1.44
%Capital Ratios:Average equity to average assets


10.66
%


19.60
%


31.62
%Tier 1 equity to average assets


8.70
%


10.95
%


25.78
%Tier 1 Risk-Based Capital ratio


12.80
%


16.28
%


28.21
%Total Risk-Based Capital ratio


14.10
%


17.57
%


29.48
%     (1)
    
    Net interest margin represents net interest income as a
    percentage of average interest-earning assets.(2)
    
    Efficiency ratio represents non-interest expenses as a
    percentage of the total of net interest income plus non-interest
    income.(3)
    
    Service1st was acquired in 100% stock exchange on
    October 28, 2010. Thus, the 2010 data represents a partial
    year.(4)
    
    Certificates of deposit issued by other banks with original
    maturities greater than three months.  MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  SERVICE1ST BANK OF NEVADA
  Form 10-K. Cautionary Note Regarding
    Forward-Looking Statements
 72




---



##### Table of Contents



Overview
  Business
    of Service1st
    SBA
    Form 10-K).
  Local
    Economic Conditions
  , CBER Report The Applied Analysis, Las Vegas Market Reports
    (2nd quarter
 73




---



##### Table of Contents



2010)
  Summary
    of Results of Operations and Financial Condition
  start-up start-up
          Critical
    Accounting Policies and Estimates
  Form 10-K),
 74




---



##### Table of Contents



Allowance
    for Loan Losses
          Investment
    Securities Portfolio
     75




---



##### Table of Contents



other-than-temporary
  Stock-Based
    Compensation
  Form 10-K.
  Income
    Taxes
    Results
    of Operations
         76




---



##### Table of Contents



Managements Discussion and Analysis of Financial
    Condition and Results of Operations of
    Service1st Bank of Nevada  Quantitative and Qualitative
    Disclosures About Market Risk
 77




---



##### Table of Contents



Period Ended October 28,


Year Ended December 31,


Year Ended December 31,2010(4)


2009


2008Interest








Interest








InterestAverage


Income/





Average


Income/





Average


Income/($ in thousands)

Balance


Expense


Yield


Balance


Expense


Yield


Balance


Expense


YieldINTEREST-EARNING ASSETS:Certificates of deposit

$
28,913


$
287



1.19
%

$
9,562


$
125



1.31
%

$
845


$
37



4.38
%Interest-bearing deposits


28,880



60



0.25
%


24,585



62



0.25
%


5,024



115



2.29
%Federal funds sold










0.00
%


3,522



8



0.23
%


7,958



152



1.91
%Investment securities


14,483



472



3.91
%


15,856



646



4.07
%


8,598



357



4.15
%Portfolio loans(1)


130,401



5,801



5.34
%


143,984



8,202



5.70
%


118,536



7,837



6.61
%Total interest-earnings assets/interest income


202,677



6,620



3.92
%


197,509



9,043



4.58
%


140,961



8,498



6.03
%NONINTEREST EARNING ASSETS:Cash and due from banks


9,285











8,329











2,603Allowance for loan losses


(7,628
)










(4,274
)










(1,468
)Other assets


5,751











3,421











3,393Total assets

$
210,085










$
204,985










$
145,489LIABILITIES AND STOCKHOLDERS EQUITYINTEREST-BEARING LIABILITIES:Demand deposits

$
31,710


$
349



1.32
%

$
19,609


$
388



1.98
%

$
10,246


$
158



1.54
%Money markets


41,118



211



0.62
%


41,271



627



1.52
%


52,649



1,344



2.55
%Savings


1,529



7



0.55
%


850



12



1.41
%


336



6



1.79
%Time deposits under $100,000


5,780



65



1.35
%


5,887



156



2.65
%


2,088



69



3.30
%Time deposits $100,00 and over


42,900



515



1.44
%


51,175



1,480



2.89
%


10,910



386



3.54
%Repurchase Agreements










0.00
%


1,538



13



0.85
%


3,303



59



1.79
%Short-term borrowings










0.00
%










0.00
%


3







1.60
%Total interest-bearing


123,037



1,147



1.12
%


120,330



2,676



2.22
%


79,535



2,022



2.54
%liabilities/interest expenseNONINTEREST BEARING LIABILITIES:Non-interest-bearing demand deposits


63,154











42,916











18,927Accrued interest on deposits and other liabilities


1,490











1,555











1,022Total liabilities


187,681











164,801











99,484Stockholders equity


22,404











40,184











46,005Total liabilities and stockholders equity

$
210,085










$
204,985










$
145,489Net interest income and Interest rate spread(2)





$
5,473



2.81
%





$
6,367



2.36
%





$
6,475



3.49
%Net interest margin(3)










3.24
%










3.22
%










4.59
%Ratio of Average Interest-Earning Assets to Interest-Bearing
    Liabilities


165
%










164
%










177
%     (1)
    
    Average balances include nonaccrual loans of approximately
    $15,066,000, $9,470,000 and $1,335,000 for the period ended
    October 28, 2010 and years ended, 2009 and 2008,
    respectively. Net loan fees or (costs) of $(180,000), $(122,000)
    and $11,000 are included in the yield computation for the period
    ended October 28, 2010 and years ended 2009 and 2008,
    respectively.(2)
    
    Net interest spread represents the average yield earned on
    interest earning assets less the average rate paid on interest
    bearing liabilities.(3)
    
    Net interest margin represents net interest income as a
    percentage of average interest-earning assets. 78




---



##### Table of Contents



(4)
    
    Service1st was acquired by Western Liberty Bancorp on
    October 28, 2010, thus the 2010 data represents a partial
    year; January 1, 2010 to October 28, 2010.    Period Ended October 28,2010 compared to Year Ended December 31, 2009Increase (Decrease)Due to Changes in:NetAverage


Average


Increase($s in thousands)

Volume


Rate


(Decrease)Interest income:Certificates of deposit

$
192


$
(30
)

$
162Interest-bearing deposits


9



(11
)


(2
)Federal funds sold


0



(8
)


(8
)Investment securities


(45
)


(129
)


(174
)Portfolio loans


(604
)


(1,797
)


(2,401
)Total increase (decrease) in interest income


(448
)


(1,975
)


(2,423
)Interest expense:Interest checking

$
133


$
(172
)

$
(39
)Money markets


(1
)


(415
)


(416
)Savings


3



(8
)


(5
)Time deposits under $100,000


(1
)


(90
)


(91
)Time deposits $100,000 and over


(99
)


(866
)


(965
)Repurchase Agreements


0



(13
)


(13
)Short-term borrowings


0



0



0Total increase (decrease) in interest expense


35



(1,564
)


(1,529
)Net increase (decrease) in net interest income

$
(483
)

$
(411
)

$
(894
)   79




---



##### Table of Contents



Years Ended December 31,2009 Compared to 2008Increase (Decrease)Due to Changes in:NetAverage


Average


Increase($s in thousands)

Volume


Rate


(Decrease)Interest income:Certificates of deposit

$
114


$
(26
)

$
88Interest bearing deposits


49



(102
)


(54
)Federal funds sold


(10
)


(134
)


(144
)Investment securities


296



(7
)


289Portfolio loans


1,451



(1,085
)


366Total increase (decrease) in interest income


1,900



(1,354
)


545Interest expense:Interest checking

$
185


$
45


$
230Money markets


(173
)


(544
)


(717
)Savings


7



(1
)


6Time deposits under $100,000


101



(14
)


87Time deposits $100,000 and over


1,164



(70
)


1,094Repurchase Agreements


(15
)


(31
)


(46
)Short-term borrowings


0



0



0Total increase (decrease) in interest expense


1,269



(615
)


654Net increase (decrease) in net interest income

$
631


$
(739
)

$
(109
)   Comparison
    of 2010 with 2009
       80




---



##### Table of Contents



Comparison
    of 2009 with 2008
         81




---



##### Table of Contents



Provision
    for Loan Losses
      Comparison
    of 2010 with 2009
   82




---



##### Table of Contents



Comparison
    of 2009 with 2008
    Non-Interest
    Income
    Comparison
    of 2010 with 2009
    Comparison
    of 2009 with 2008
   83




---



##### Table of Contents



Non-Interest
    Expense
    Period Ended October 28, 2010 And Years Ended
    December 31,($ in thousands)

2010(1)


2009


2008Non-interest expenses:Salaries and employee benefits

$
3,536


$
3,875


$
5,029Occupancy, equipment and depreciation


1,360



1,673



1,664Computer service charges


243



328



313Professional fees


1,605



1,026



256Advertising and business development


79



88



157Insurance


705



500



145Telephone


87



101



104Stationary and supplies


26



32



45Director fees


34



44



23Loss on disposition of equipment s


0



3



0Other real estate owned


654



0



0Provision for unfunded commitments


(471
)


498



140Other


510



425



387Total non-interest expenses

$
8,368


$
8,593


$
8,263     (1)
    
    For the period January 1, 2010 through October 28,
    2010.  Comparison
    of 2010 with 2009
    Comparison
    of 2009 with 2008
   84




---



##### Table of Contents



Income
    Taxes
    Financial
    Condition
  Assets
    Cash and
    Cash Equivalents
   Liquidity and Asset/Liability
    Management
  Investment
    Securities and Certificates of Deposits held at other
    Banks
         85




---



##### Table of Contents



available-for-sale available-for-sale Held-to-maturity
  For the Period Ended October 28, 2010Gross


GrossAmortized


Unrealized


Unrealized


Fair(Dollars in thousands)

Cost


Gains


Losses


ValueInvestments  Available for SaleU.S. Government Agency Securities

$
1,002


$



$



$
1,002Collateralized Mortgage Obligations-commercial


1,868







(20
)


1,848Total

$
2,870


$



$
(20
)

$
2,850   For the Period Ended October 28, 2010Gross


GrossAmortized


Unrecognized


Unrecognized


Fair(Dollars in thousands)

Cost


Gains


Losses


ValueInvestments-Held to MaturityCorporate debt securities

$
6,924


$
256


$



$
7,180SBA Loan Pools


658



4







662Total

$
7,582


$
260


$



$
7,842   December 31, 2009Gross


GrossAmortized


Unrealized


Unrealized


Fair(Dollars in thousands)

Cost


Gains


Losses


ValueInvestments  Available for SaleU.S. Government Agency Securities

$
5,248


$



$
(19
)

$
5,229Collateralized Mortgage Obligations-commercial


2,209







(4
)


2,205Total

$
7,457


$



$
(23
)

$
7,434   December 31, 2009Gross


GrossAmortized


Unrecognized


Unrecognized


Fair(Dollars in thousands)

Cost


Gains


Losses


ValueInvestments-Held to MaturityU.S. Government Agency Securities

$
997


$
3


$



$
1,000Corporate debt securities


8,390



477







8,867SBA Loan Pools


814







(5
)


809Total

$
10,201


$
480


$
(5
)

$
10,676       86




---



##### Table of Contents



Due Under 1 Year Amount/Yield


Due 1-5 Years Amount/Yield


Due 5-10 Years Amount/Yield


Due Over 10 Years Amount/Yield


Total Amount/YieldAvailable for SaleU.S. Government Agency Securities

$
0



0.00
%

$
1,002



1.50
%

$
0



0.00
%

$
0



0.00
%

$
1,002



1.50
%Corporate Debt Securities


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Collateralized Mortgage Obligations-commercial


978



6.28
%


870



5.82
%


0



0.00
%


0



0.00
%


1,848



6.06
%Small Business Administration Loan Pools


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Total available for sale

$
978



6.28
%

$
1,872



3.51
%

$
0



0.00
%

$
0



0.00
%

$
2,850



4.46
%Held to MaturityU.S. Government Agency Securities

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%

$
0



0.00
%Corporate Debt Securities


4,027



5.36
%


3,153



5.19
%


0



0.00
%


0



0.00
%


7,180



5.29
%Collateralized Mortgage Obligations-commercial


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Small Business Administration Loan Pools


7



3.12
%


15



5.13
%


100



2.91
%


540



3.27
%


662



3.26
%Total held to maturity

$
4,034



5.36
%

$
3,168



5.19
%

$
100



2.91
%

$
540



3.27
%

$
7,842



5.11
%     TotalDue Under 1 Year Amount/Yield


Due 1-5 Years Amount/Yield


Due 5-10 Years Amount/Yield


Due Over 10 Years Amount/Yield


Amount/YieldAvailable for SaleU.S. Government Agency Securities

$
0



0.00
%

$
5,229



1.48
%

$
0



0.00
%

$
0



0.00
%

$
5,229



1.48
%Corporate Debt Securities


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Collateralized Mortgage Obligations-commercial


0



0.00
%


2,204



2.65
%


0



0.00
%


0



0.00
%


2,204



2.65
%Small Business Administration Loan Pools


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Total available for sale

$
0



0.00
%

$
7,433



1.83
%

$
0



0.00
%

$
0



0.00
%

$
7,433



1.83
%Held to MaturityU.S. Government Agency Securities

$
0



0.00
%

$
997



1.55
%

$
0



0.00
%

$
0



0.00
%

$
997



1.55
%Corporate Debt Securities


4,011



3.74
%


4,379



7.11
%


0



0.00
%


0



0.00
%


8,390



5.50
%Collateralized Mortgage Obligations-commercial


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%


0



0.00
%Small Business Administration Loan Pools


0



0.00
%


38



3.41
%


136



2.94
%


641



2.72
%


814



2.79
%Total held to maturity

$
4,011



3.74
%

$
5,414



6.06
%

$
136



2.94
%

$
641



2.72
%

$
10,201



4.90
%   Loans
   87




---



##### Table of Contents



For the Period Ended October 28, 2010and Years Ended December 31, 2009 and 2008($ in thousands)

2010


2009


2008Loans secured by real estate:Construction, land development and other land loans

$
9,225



7.35
%

$
20,279



14.80
%

$
38,608



28.12
%Commercial real estate


62,963



50.22
%


68,523



50.02
%


41,114



29.95
%Residential (1 to 4 family)


10,282



8.20
%


1,367



1.00
%


483



0.35
%Total real estate-secured loans


82,470



65.77
%


90,169



65.83
%


80,205



58.42
%Loans not secured by real estate:Commercial and industrial


42,778



34.12
%


46,470



33.92
%


56,556



41.20
%Consumer


136



0.11
%


342



0.25
%


522



0.38
%Loans, Gross


125,384



100.00
%


136,981



100.00
%


137,283



100.00
%Net deferred loan fees


20







(15
)






(67
)Loan, Gross, net of deferred fees


125,404







136,966







137,216Less: Allowance for loan losses


(9,418
)






(6,404
)






(2,883
)Loans, Net

$
115,986






$
130,562






$
134,333      88




---



##### Table of Contents



For the Period Ended October 28, 2010Due Within





Due OverOne Year


Due 1-5 Years


Five Years


TotalLoans secured by real estate:Construction, land development and other land loans

$
6,429


$
2,796


$



$
9,225Commercial real estate


350



24,852



37,761



62,963Residential real estate (1 to 4 family)


7,708



2,409



165



10,282Total real estate secured loans

$
14,487


$
30,056


$
37,926


$
82,470Loans not secured by real estate:Commercial and industrial


20,405



13,920



8,453



42,778Consumer


80



56







136Loans, Gross

$
34,973


$
44,033


$
46,378


$
125,384Interest rates:Fixed

$
8,691


$
35,190


$
8,568


$
52,449Variable


26,281



8,842



37,811



72,935Gross loans

$
34,973


$
44,033


$
46,378


$
125,384   Concentrations
    Interest
    Reserves
  and/or and/or
  Nonperforming
    Assets
    nonaccrual loans.
 89




---



##### Table of Contents



loans past due 90 days or more and still
    accruing interest
  restructured loans
  other real estate owned, or OREO
    For the Period Ended October 28, 2010and Years Ended December 31, 2009 and 2008($s in thousands)

2010


2009


2008Nonaccrual loans:Loans Secured by Real EstateConstruction, land development and other land loans

$
5,977


$
6,524


$
3,434Commercial real estate


8,611



0



0Residential real estate (1-4 family)


0



0



0Total loans secured by real estate


14,588



6,524



3,434Commercial and industrial


5,739



1,275



0Consumer


0



0



0Total nonaccrual loans


20,327



7,799



3,434Past due (>90days) loans and accruing interest:Loans Secured by Real EstateConstruction, land development and other land loans


0



0



0Commercial real estate


0



0



0Residential real estate (1-4 family)


0



0



0Total loans secured by real estate


0



0



0Commercial and industrial


0



0



0Consumer


0



0



0Total past due loans accruing interest


0



0



0Restructured loans (still on accrual)(1)


0



0



0Total nonperforming loans

$
20,327



7,799


$
3,434Other real estate owned (OREO)


2,403



0



0Total nonperforming assets

$
22,730


$
7,799


$
3,434Non-Performing Loans as a percentage of total portfolio loans


16.21
%


5.69
%


2.50
%Non-Performing Loans as a percentage of total assets


11.30
%


3.68
%


2.15
%Non-Performing assets as a percentage of total assets


12.63
%


3.68
%


2.15
%Allowance for loan losses as a percentage of nonperforming loans


46.34
%


82.11
%


83.95
%     (1)
    
    For the period ended October 28, 2010 and years ended
    December 31, 2009 and 2008, Service1st had approximately
    $11.0 million, $526,000, and $3.4 million,
    respectively, in loans classified as restructured loans. All of
    such loans were on nonaccrual. 90




---



##### Table of Contents



Potential
    Problem Loans
   91




---



##### Table of Contents



Information Related to
    Service1st Potential Problem Loans
  For the Period Ended October 28, 2010


At December 31, 2009# of


Loan





Percent of


# of


Loan





Percent ofLoans


Balance


%


Total Loans


Loans


Balance


%


Total LoansConstruction, land development and other land loans


1


$
856



5.75
%


0.68
%


4


$
8,578



23.71
%


6.26
%Commercial real estate


4



4,319



28.97
%


3.44
%


6



12,320



34.06
%


9.00
%Residential real estate (1-4 family)


1



2,909



19.51
%


2.32
%


0



0



0.0
%


0.0
%Commercial and industrial


16



6,824



45.77
%


5.44
%


22



14,790



40.89
%


10.80
%Consumer


0



0



0.00
%


0.00
%


3



483



1.34
%


0.35
%Total Loans


22


$
14,908



100
%


11.88
%


35


$
36,171



100
%


26.41
%       Impaired
    Loans
     92




---



##### Table of Contents



93




---



##### Table of Contents



At or for the Period Ended October 28, 2010Impaired





Percent of


Reserve





Percent of($ in thousands)

Balance


%


Total Loans


Balance


%


Total AllowanceConstruction, land development and other land loans

$
6,834



25.40
%


5.45
%

$
149



2.74
%


1.58
%Commercial real estate


9,325



34.67
%


7.44
%


1,395



25.66
%


14.81
%Residential real estate (1-4 family)


2,909



10.81
%


2.32
%


145



2.67
%


1.54
%Commercial and industrial


7,833



29.12
%


6.25
%


3,748



68.93
%


39.80
%Consumer


0



0.00
%


0.00
%


0



0.00
%


0.00
%Total impaired loans

$
26,901



100.00
%


21.46
%

$
5,437



100.00
%


57.73
%   At December 31, 2009Impaired





Percent of


Reserve





Percent of($ in thousands)

Balance


%


Total Loans


Balance


%


Total AllowanceConstruction, land development and other land loans

$
8,081



86.37
%


5.91
%

$
453



53.91
%


7.08
%Commercial real estate


0



0.00
%


0.00
%


0



0.00
%


0.00
%Residential real estate (1-4 family)


0



0.00
%


0.00
%


0



0.00
%


0.00
%Commercial and industrial


1,275



13.63
%


0.93
%


388



46.09
%


6.05
%Consumer


0



0.00
%


0.00
%


0



0.00
%


0.00
%Total impaired loans

$
9,356



100.00
%


6.84
%

$
841



100.00
%


13.13
%    94




---



##### Table of Contents



Allowance
    for Loan Losses
    For the Period Ended October 28, 2010Analysis of Loss Experience by Loan Type

and Years Ended December 31, 2009, 2008($s in thousands)

2010


2009


2008Allowance for Loan and Lease Loss:Balance at the beginning of the period

$
6,404


$
2,883


$
922Provisions charged to operating expenses


6,329



15,666



3,670Recoveries of loans previously charged off:Construction, land development and other land loans


293



0



0Commercial real estate


0



0



0Residential real estate (1-4 family)


1



0



0Commercial and industrial


321



9



0Consumer


0



0



3Total recoveries


615



9



3Loans charged-off:Construction, land development and other


1,151



7,745



1,712Commercial


922



0



0Residential (including multi-family)


202



0



0Commercial and industrial


1,655



4,409



0Consumer


0



0



0Total charged-off


3,930



12,154



1,712Net charge-offs


3,315



12,145



1,709Balance at end of period

$
9,418


$
6,404


$
2,883Net Charge-offs to average loans outstanding


2.54
%


8.43
%


1.44
%Allowance for Loan Loss to outstanding loans


7.51
%


4.68
%


2.10
%   Critical Accounting Policies 
    Allowance for Loan Losses.
     95




---



##### Table of Contents



clean-up Information Related to
    Service1st Bank of Nevada  Allowance for Loan
    Losses
  and/or
 96




---



##### Table of Contents



For the Period Ended


Year Ended


Year EndedOctober 28, 2010


December 31, 2009


December 31, 2008($s in thousands)

Amount


% of loans


Amount


% of loans


Amount


% of loansAllowance for Loan and Lease Loss:Loans Secured by Real EstateConstruction, land development and other land loans

$
318



7.36
%

$
1,322



14.80
%

$
1,083



28.12
%Commercial real estate


3,019



50.22
%


1,890



50.02
%


484



29.95
%Residential real estate (1-4 family)


737



8.20
%


54



1.00
%


6



0.35
%Total loans secured by real estate


4,074



65.77
%


3,266



65.82
%


1,573



58.42
%Commercial and industrial


5,339



34.12
%


3,135



33.92
%


1,177



41.20
%Consumer


5



0.11
%


3



0.26
%


133



0.38
%Total allowance for loan loss

$
9,418



100
%

$
6,404



100
%

$
2,883



100
%          97




---



##### Table of Contents



Deferred
    Tax Asset
      Deposits
        For the Period EndedOctober 28, 2010


December 31, 2009($s in thousands)

Amount


% of Total


Amount


% of TotalNon-interest-bearing deposits

$
68,575



42.31
%

$
56,463



30.47
%Interest-bearing deposits


29,018



17.91
%


25,094



13.54
%Money Markets


28,316



17.47
%


41,774



22.54
%Savings


1,065



0.66
%


1,435



0.77
%Time deposits under $100,000


4,888



3.02
%


6,238



3.37
%Time deposits $100,000 and over


30,204



18.64
%


54,316



29.31
%Total Deposits

$
162,066



100.00
%

$
185,320



100.00
%    98




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##### Table of Contents



Certificates
    of Deposit Maturities > $100,000
  ($s in thousands)

AmountThree months or less

$
10,503Over three months to six months


4,075Over six months to twelve months


15,626Over 12 months


0Total

$
30,204   Capital
    Resources
    Supervision and Regulation and/or
    de
    novo
 99




---



##### Table of Contents



To Be WellCapitalized UnderRegulatoryCapital Ratios:

Service1st

AgreementTier 1 equity to average assets


8.70
%


8.50
%Tier 1 risk-based capital ratio


12.80
%


6.00
%Total risk-based capital ratio


14.10
%


12.00
%     Liquidity
    and Asset/Liability Management
          Off-Balance
    Sheet Arrangements
   100




---



##### Table of Contents



For the PeriodEndedOctober 28,

At December 31,2010

2009

2008($ in thousands)Commitments to extend credit


15,965



25,035



32,000Commitments to extend credit to directors and officers
    (undisbursed amount)


2,392



1,392



441Standby/commercial letters of credit


695



1,408



152       Contractual
    Obligations
    Payments Due by Period($s in thousands)




Less Than


1-3


3-5


AfterContractual Obligations

Total


1 Year


Years


Years


5 YearsLong Term Borrowed Funds

$
0


$
0


$
0


$
0


$
0Capital Lease Obligations


0



0



0



0



0Operating Lease Obligations


3,104



889



2,215



0



0Purchase Obligations


0



0



0



0



0Other Long Term Liabilities


0



0



0



0



0$
3,104


$
889


$
2,215


$
0


$
0   Quantitative
    and Qualitative Disclosures About Market Risk
  and/or
   101




---



##### Table of Contents



day-to-day
      Form 10-K.
 102




---



##### Table of Contents



December 31,
    2009
    Sensitivity of Net Interest Income
  PercentageAdjusted Net

ChangeInterest Rate Scenario

Interest Income

from Base(Dollars in thousands)Up 300 basis points

$
7,699



22.13
%Up 200 basis points


7,244



14.91
%Up 100 basis points


6,784



7.61
%BASE


6,304



0.00
%Down 100 basis points


6,371



1.06
%Down 200 basis points


6,551



3.92
%   Item 7A 
    Quantitative
    and Qualitative Disclosures About Market Risk    Item 8 
    Financial
    Statements and Supplementary Data    Item 9 
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A 
    Controls
    and Procedures  (a)  Evaluation
    of disclosure controls and procedures.
  Rules 13a-15(e) 15d-15(e)
  (b)  Changes
    in Internal Control over Financial Reporting
   103




---



##### Table of Contents



(c)  Managements
    Annual Report on Internal Control over Financial
    Reporting
        Internal
    Control  Integrated Framework. Internal
    Control  Integrated Framework.
    Item 9B 
    Other
    Information   PART III  Item 10 
    Directors,
    Executive Officers and Corporate Governance   104




---



##### Table of Contents



Executive
    Officers of the Registrant
    Name

Age


PositionWilliam E. Martin


69


Chief Executive OfficerGeorge A. Rosenbaum, Jr.


54


Chief Financial OfficerPatricia A. Ochal


46


Vice PresidentRichard Deglman


67


Chief Credit Officer of Service1st Bank   William E. Martin
  George A. Rosenbaum, Jr. de novo
  Patricia A. Ochal
 105




---



##### Table of Contents



Richard Deglman
  Financial
    Experts on Audit Committee
  Rule 10A-3
  Item 11 
    Executive
    Compensation    Item 12 
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters  Securities
    authorized for issuance under equity compensation
    plans
  Equity
    Compensation Plan Information
  column (a)


column (b)


column (c)Number ofsecuritiesremaining availableNumber of





for future issuancesecurities to be





under equityissued upon


Weighted-average


compensation plansexercise of


exercise price of


(excludingoutstanding


outstanding


securitiesoptions, warrants,


options, warrants,


reflected in columnand rights


and rights


(a))Equity compensation plans approved by security holders


0



not applicable



0Equity compensation plans not approved by security holders(1)(2)


246,952


$
21.01



229,023Total


246,952


$
21.01



229,023     (1)
    
    In connection with the Acquisition, outstanding options to
    acquire Service1st Bank common stock granted under the 2007
    Stock Option Plan of Service1st (the Stock Option
    Plan) and outstanding warrants to acquire Service1st
    common stock became options and warrants of similar tenor to
    acquire Common Stock, 106




---



##### Table of Contents



adjusted for the exchange ratio applicable to the Acquisition.
    We assumed the Stock Option Plan, which was approved by
    Service1st stockholders prior to the Acquisition, in connection
    with the Acquisition, and WLBC may issue additional awards under
    the Stock Option Plan. The table does not include the
    aforementioned warrants granted by Service1st Bank. In
    recognition of organizational funds contributed and economic
    risks borne during the banks organizational phase, those
    warrants were granted by Service1st Bank to the individuals who
    participated in Service1st Banks organization, rather than
    being issued as part of a compensation plan.(2)
    
    In addition to the Stock Option Plan, prior to the Acquisition
    WLBCs board of directors granted to its Compensation
    Committee the right to award up to 1.5 million shares of
    restricted stock to members of management and to consultants.
    The board of directors granted to the Compensation Committee the
    right to determine after completion of the acquisition to whom
    awards, if any, shall be granted and what the terms of those
    awards shall be. The Compensation Committee awards will not be
    submitted for approval by stockholders in advance. When the
    Acquisition occurred WLBC also granted 50,000 shares of
    common stock to each of Michael B. Frankel, the current Chairman
    of the board of directors, Richard A.C. Coles, a current member
    of the board of directors, and Mark Schulhof, a former member of
    the board of directors.Restricted stock units that will be settled for a total of
    200,000 shares of our stock were granted to five
    individuals when the acquisition was completed: Jason N. Ader,
    WLBCs former Chairman and Chief Executive Officer and a
    current member of the board (50,000 restricted stock units),
    Daniel B. Silvers, WLBCs former President (100,000
    restricted stock units), Andrew P. Nelson, our former Chief
    Financial Officer and a former member of the board (25,000
    restricted stock units), Michael Tew, an outside consultant
    (20,000 restricted stock units), and Laura Conover-Ferchak, an
    outside consultant (5,000 restricted stock units). Each
    restricted stock unit is immediately and fully vested and will
    be settled for one share of our common stock on October 28,
    2013, or if sooner when a change of control occurs, without
    payment of any additional consideration for the shares. The
    restricted stock units and the shares of Common Stock that will
    be issued upon their settlement are not included in the table
    above.  Security
    ownership of certain beneficial owners and
    management
    Item 13 
    Certain
    Relationships and Related Transactions and Director
    Independence    Item 14 
    Principal
    Accountant Fees and Services   PART IV  Item 15 
    Exhibits
    and Financial Statement Schedules  Financial statements filed as part of this
    Form 10-K
 107




---



##### Table of Contents



Table
    of Contents
  ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA  Index
    to Financial Statements
  Western Liberty BancorpReport of Independent Registered Public
    Accounting Firm


109Consolidated Balance Sheets as of
    December 31, 2010 and 2009


111Consolidated Statements of Operations for the
    years ended December 31, 2010, 2009, and 2008


112Consolidated Statements of Stockholders
    Equity and Comprehensive Income (Loss) for the years ended
    December 31, 2010, 2009 and 2008


113Consolidated Statements of Cash Flow for the
    years ended December 31, 2010, 2009, and 2008


114Notes to Consolidated Financial Statements


115Service 1st Bank of NevadaReport of Independent Registered Public
    Accounting Firm


155Balance Sheets as of October 28, 2010 and
    December 31, 2009


157Statements of Operations for the ten months ended
    October 28, 2010 and the years ended December 31, 2009
    and 2008


158Statements of Stockholders Equity and
    Comprehensive Loss for the ten months ended October 28,
    2010 and the years ended December 31, 2009 and 2008


159Statements of Cash Flows for the ten months ended
    October 28, 2010 and the years ended December 31, 2009
    and 2008


160Notes to Consolidated Financial Statements


161  108




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm            
    109




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm
        /s/  Hays &
    Company LLP
    110




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
   CONSOLIDATED
    BALANCE SHEETS($000S EXCEPT PER SHARE DATE)  December 31,2010


2009AssetsCash and due from banks

$
11,675


$
971Money market funds


52,206



86,998Interest-bearing deposits in banks


39,346



Cash and cash equivalents


103,227



87,969Certificates of deposits


26,889



Securities, available for sale


1,819



Securities, held to maturity (estimated fair value
    2010  $5,287)


5,314



Loans, net of allowance of $36


106,223



Premises and equipment, net


1,228



Other real estate owned, net


3,406



Goodwill, net


5,633



Other intangibles, net


768



Accrued interest receivable and other assets


3,039



551Total assets

$
257,546


$
88,520Liabilities And Stockholders EquityDeposits:

$
67,087


$
Non-interest bearing demand






Interest bearing:


93,199



Total deposits


160,286Accrued interest payable and other liabilities


3,431



628Total liabilities


163,717



628Commitments and contingencies (Note 15)Stockholders Equity:Preferred stock, $.0001 par value; 1,000,000 shares
    authorized; None issued or outstandingCommon stock, $.0001 par value; 100,000,000 shares
    authorized; 15,088,023 and 10,959,169 issued and outstanding,
    respectively


1



1Additional paid-in capital


117,317



103,730Accumulated deficit


(23,489
)


(15,839
)Accumulated other comprehensive loss, net






Total stockholders equity


93,829



87,892Total liabilities and stockholders equity

$
257,546


$
88,520    111




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
   CONSOLIDATED
    STATEMENTS OF OPERATIONS($000 EXCEPT PER SHARE DATA)  Years Ended December 31,2010


2009


2008Interest and dividend income:Loans, including fees

$
1,403


$



$
Securities, taxable


47







Federal funds sold and other


80



139



5,691Total interest and dividend income


1,530



139



5,691Interest expense:Deposits


115







Total interest expense


115







Net interest income


1,415



139



5,691Provision for loan losses


36Net interest income after provision for loan losses


1,379



139



5,691Non  interest income:Service charges


57







Loan and late fees


3







Other


48







108







Non  interest expenseSalaries and employee benefits


1,461



72



83Occupancy, equipment and depreciation


269







Computer service charges


51







Federal deposit insurance


90







Legal and professional fees


3,851



12,612



1,670Advertising and business development


7



1Insurance


825



301



301Telephone


19







Printing and supplies


314



748



6Stock  based compensation


1,770



869



4,625Other


480



434



5599,137



15,037



7,244Net loss

$
(7,650
)

$
(14,898
)

$
(1,553
)Basic loss per common share

$
(0.65
)

$
(0.45
)

$
(0.05
)Diluted loss per common share

$
(0.65
)

$
(0.45
)

$
(0.05
)    112




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
 CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME
    (LOSS)YEARS ENDED DECEMBER 31, 2010, 2009, AND
    2008  AccumulatedAdditional





OtherComprehensive


Common Stock Issued


Paid-in


Earnings


ComprehensiveLoss


Shares


Amounts


Capital


(Deficit)


Loss


TotalBalance, December 31, 2007

$




39,936,064


$
3


$
209,903


$
611


$



$
210,517Stock  based compensation














4,625











4,625Deferred interest on investment held in trust relating to common
    shares subject to possible conversion














(446
)










(446
)Net loss

$
(1,552
)














(1,552
)






(1,552
)Balance, December 31, 2008






39,936,064



3



214,082



(941
)






213,144Exchange of common shares at $0.001 per share






(7,618,908
)


(1
)


(6
)










(7
)Redemption of common shares at $9.915 per share, net of
    $94,983,921 reserved for






(21,357,987
)


(1
)


(116,779
)










(116,780
)Settlement of deferred underwriters commission in
    connection with offering














5,564











5,564Stock-based compensation














869











869Net loss

$
(14,898
)














(14,898
)






(14,898
)Balance, December 31, 2009






10,959,169



1



103,730



(15,839
)






87,892Stock-based compensation reversal














(587
)










(587
)Issue common shares in conjunction with acquisition of
    Service1st Bank of Nevada






2,370,722







15,267











15,267Exercise Warrants






1,502,088







(2,884
)










(2,884
)Issuance of 194,098 shares of common stock for restricted
    stock award






194,098



















Issuance of 150,000 shares of common stock for restricted
    stock award






150,000







966











966Purchase of dissenters shares






(88,054
)






(567
)










(567
)Stock-based compensation














1,392











1,392Net loss


(7,650
)














(7,650
)






(7,650
)Other comprehensive income (loss)


























Comprehensive loss

$
(7,650
)






















Balance, December 31, 2010






15,088,023


$
1


$
117,317


$
(23,489
)





$
93,829  113




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  CONSOLIDATED STATEMENTS OF CASH
    FLOWS
 YEARS ENDED DECEMBER 31, 2010,
    2009 AND 2008
 ($000S EXCEPT PER SHARE)
  2010


2009


2008Cash flow from operating activitiesNet (loss) income

$
(7,650
)

$
(14,898
)

$
(1,552
)Adjustments to reconcile net (loss) income to net cash used
    in operating activitiesStock-based compensation


1,771



869



4,625Interest earned on cash held in trust






(86
)


(5,664
)Accretion of loan discount, net


(436
)






Amortization of core deposit intangible


16







Amortization of lease liability


(31
)






Amortization of time deposit premium


(5
)






Provision of loan losses


36







Depreciation of premises and equipment


72







Amortization of securities premiums/discounts, net


28







Changes in operating assets and liabilitiesPrepaid expenses and other assets


343



(294
)Accrued expenses and other liabilities


(708
)


(54
)


355Accrued offering costs










(499
)Net cash (used in) operating activities


(6,564
)


(14,463
)


(2,735
)Cash flow from investing activitiesCash withdrawn from trust account for working capital






316,778



4,100Proceeds from certificates of deposit


5,039







Proceeds from maturities of securities available for sale


1,000







Proceeds from principal paydowns of securities available for sale


23







Proceeds from maturities of securities held to maturity


2,500







Proceeds from principal payments of securities held to maturity


10







Cash acquired from acquisition


15,090







Purchase of premises and equipment


(16
)






Net decrease in loans


3,453







Net cash used in investing activities


27,099



316,778



4,100Cash flow from financing activitiesNet decrease in deposits


(1,826
)






Cash payments for warrants


(2,884
)






Cash payments for dissenter common shares


(567
)Payment of redemption of common shares






(211,765
)


Payment of underwriters discount and offering costs






(4,027
)


Net cash (used in) financing activities


(5,277
)


(215,792
)


Net increase in cash and equivalents


15,258



86,523



1,365Cash and cash equivalents, beginning of period


87,969



1,446



81Cash and cash equivalents, end of period

$
103,227


$
87,969


$
1,446Supplemental disclosures of cash flow information:Cash payments for:Interest paid to depositors

$
124







Supplemental disclosure of non-cash financing activities:Deferred interest on investments held in trust relating to
    common shares subject to possible conversion






96



446Supplemental schedule of non-cash investing activities:Loans transferred to other real estate owned


1,003







Supplemental schedule of non-cash investing activities from
    acquisition:Non-cash assets acquired:Certificates of deposits


31,928







Investment securities available for sale


2,850







Investment securities held to maturity


7,842







Loans, net of discount


110,278







Other real estate owned, net of discount


2,403







Premises and equipment


1,284







Goodwill


5,633







Other intangibles


784







Other assets


2,826







Total non-cash assets acquired:

$
165,828







Liabilities assumed:Deposits

$
162,112







Accrued expenses and other liabilities


1,694







Total liabilities assumed:

$
163,806







Net non-cash assets acquired (liabilities assumed):

$
2,022







Net cash and cash equivalents (paid) acquired

$
15,090







    114




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL STATEMENTS
  NOTE 1.
    NATURE OF
    BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  Nature
    of business
  pro rata
    de novo
  de novo de novo de novo 12-month
 115




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
             116




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Predecessors
    Use
    of estimates in the preparation of financial
    statements
    Cash
    and cash equivalents
        Certificates
    of deposit
    Securities
   117




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
          other-than-temporary
  another-than-temporary other-than-temporarily
  Loans
     118




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
        case-by-case
               119




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
          Interest
    and fees on loans
         120




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  Transfers
    of financial assets
    Foreclosed
    assets
    Advertising
    costs
    Premises
    and equipment
    YearsFurniture and fixtures


7 - 10Equipment and vehicles


3 - 5Leasehold improvements


5 - 10   Goodwill
    and other intangible assets
      Accrued
    interest receivable and other assets
   121




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
      Income
    taxes
    and/or
  Preferred
    stock
    Stock
    compensation plans
   122




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  Loan
    commitments and related financial instruments
    Comprehensive
    loss
    Fair
    value measurement
    Fair
    values of financial instruments
  ASC 310-30-50.
     123




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
      Certificates
    of deposit
    Securities
    Loans
    Impaired
    loans
    Accrued
    interest receivable and payable
    Restricted
    stock
    Deposit
    liabilities
   124




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  Off-balance
    sheet instruments
    Loss
    per share
      Loss
    Contingencies
    Dividend
    Restriction
    Reclassifications
    Recent
    accounting pronouncements
       125




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    held-to-maturity available-for-sale
  No. 2010-20, Disclosures about the Credit Quality
    of Financing Receivables and the Allowance for Credit Losses. tm
  Newly
    issued not yet effective standards
  2010-29, Disclosure of
    Supplementary Pro Forma Information for Business Combinations. No. 10-G. Business Combinations pro forma pro forma
  2010-06, Improving Disclosure about Fair Value Measurements i.e Form 10-Q
 126




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  No. 2010-28, Intangibles  Goodwill and Other (Topic 350): When
    to Perform Step 2 of the Goodwill Impairment Test for Reporting
    Units with Zero and Negative Carrying Amounts No. 10-A.
  NOTE 2.
    BUSINESS
    COMBINATION       127




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    mark-to-market
  Consideration ($ in 000s)Cash (fractional shares and additional dissenter payments)

$
29Equity instruments


15,267Contingent consideration


1,816Fair value of total consideration transferred


17,112Book value of net assets acquired


16,438Excess purchase price over book value of net assets acquired

$
674Allocation of Excess Purchase Price:Core deposit intangible

$
784Fair Value Adjustments:Loans


(5,715
)Time deposits


(46
)Securities Held to Maturity


260Leases


(242
)Goodwill


5,633Total

$
674Fair value of assets acquiredCash and cash equivalents

$
15,090Certificates of deposit


31,928Securities, available for sale


2,850Securities, held to maturity


7,842Loans


110,278Premises and equipment, net


1,284Other Real Estate Owned


2,403Core deposit intangible


784Goodwill


5,633Other


2,826Fair value of assets acquired

$
180,918Fair value of liabilities assumedDeposits


162,112Other


1,694Fair value of liabilities assumed


163,806Net assets acquired at fair value

$
17,112  128




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    pro forma pro forma
  2010

2009Net interest income

$
7,098


$
6,590Net (loss) income

$
(14,753
)

$
(32,191
)Basic earnings per share

$
(0.98
)

$
(2.13
)Diluted earnings per share

$
(0.98
)

$
(2.13
)   NOTE 3.
    FAIR
    VALUE    Level 1
  Level 2 
  Level 3 
  Fair
    value on a recurring basis
    Securities
    available for sale
   129




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Fair Value Measurements at December 31, 2010Quoted Prices inActive Markets for


Significant Other


Significant($ in 000s)




Identical Assets


Observable Inputs


Unobservable InputsDescription

Total


(Level 1)


(Level 2)


(Level 3)Securities available for saleCollateralized Mortgage Obligation Securities-commercial

$
1,819


$



$
1,819


$
     Fair
    value on a nonrecurring basis
    Fair Value Measurements at December 31, 2010Quoted Prices inActive Markets for


Significant Other


Significant($ in 000s)




Identical Assets


Observable Inputs


Unobservable InputsDescription

Total


(Level 1)


(Level 2)


(Level 3)Impaired loans

$
11,438


$



$



$
11,438Other real estate owned


3,406











3,406$
14,844


$



$



$
14,844   Impaired
    loans
    Other
    real estate owned
   130




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  mark-to-market held-to-maturity,
    2010

2009Carrying



Carrying($ in 000s)

Amount

Fair Value

Amount

Fair ValueFinancial Assets:Cash and cash equivalents

$
103,227


$
103,227


$
87,969


$
87,969Certificates of deposits


26,889



26,889







Securities available for sale


1,819



1,819







Securities held to maturity


5,314



5,287







Loans, net


106,223



106,223







Accrued interest receivables


447



447







Financial Liabilities:Deposits


160,286



160,286







Accrued interest payable


35



35







   Loan
    Commitments
    NOTE 4.
    SECURITIES  Gross

GrossAmortized

Unrealized

UnrealizedSecurities Available for Sale

Cost

Gains

Losses

Fair ValueCollateralized Mortgage Obligation Securities-commercial

$
1,819


$



$



$
1,819$
1,819


$



$



$
1,819   131




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  Gross


GrossAmortized


Unrecognized


UnrecognizedSecurities Held to Maturity

Cost


Gains


Losses


Fair ValueCorporate Debt Securities

$
4,663


$



$
(27
)

$
4,636Small Business Administration Loan Pools


651











651$
5,314


$



$
(27
)

$
5,287         2010Less Than Twelve Months


Over Twelve MonthsGross Unrealized





Gross Unrealized(Losses)


Fair Value


(Losses)


Fair ValueSecurities Available for SaleCollateralized Mortgage Obligation Securities-commercial














$



$



$



$
Securities Held to MaturityCorporate Debt Securities

$
(27
)

$
4,636







Small Business Administration Loan Pools














$
(27
)

$
4,636


$



$
   other-than-temporarily-impaired
    Amortized Cost


Fair ValueSecurities available for saleDue in one year or less

$
1,417


$
1,417Due after one year through five years


402



402$
1,819


$
1,819   132




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  Amortized Cost


Fair ValueSecurities held to maturityDue in one year or less

$
3,093


$
3,075Due after one year through five years


1,570



1,561Small Business Administration loan pools


651



651$
5,314


$
5,287   NOTE 5.
    LOANS    ($ in 000s)

2010Construction, land development and other land

$
5,923Commercial real estate


54,975Residential real estate


9,247Commercial and industrial


35,946Consumer


131Plus: net deferred loan costs


37106,259Less: allowance for loan losses


(36
)$
106,223     ($ in 000s)

2010Beginning balance


Provision for loan losses

$
36Loans charged-off


Recoveries


Ending balance

$
36       ($ in 000s)

Nonaccrual


Over 90 Days and AccruingConstruction, land development and other land

$
2,632


$
Commercial real estate


1,224



Residential real estate


2,900



Commercial and industrial


3,670



Consumer






Total

$
10,426


$
  133




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Greater than($ in 000s)

30-90 Days


90 Days


Total Past DueConstruction, land development and other land

$



$
2,518


$
2,518Commercial real estate






1,003



1,003Residential real estate






2,900



2,900Commercial and industrial


3,108



38



3,146Consumer










Total

$
3,108


$
6,459


$
9,567     Special
    Mention
    Substandard
    Doubtful
     134




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Special($ in 000s)

Pass


Mention


Substandard


Doubtful


TotalConstruction, land development and other land

$
996


$



$
4,630


$



$
5,626Commercial real estate


47,711



2,806



4,296



162



54,975Residential real estate


3,990







5,257







9,247Commercial and industrial


30,582



240



4,483



938



36,243Consumer


131















131Total

$
83,410


$
3,046


$
18,666


$
1,100


$
106,222   Purchased
    Loans
    ($ in 000s)

2010Construction, land development and other land

$
4,630Commercial real estate


4,458Residential real estate


5,257Commercial and industrial


5,421Balance December 31, 2010

$
19,766         case-by-case
 135




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    ($ in 000s)

2010Related to new loans purchased

$
576Accretion of income


(37
)Balance December 31, 2010

$
539       ($ in 000s)

2010Contractually required payments receivable of loans purchased
    during the year:Construction, land development and other land

$
7,685Commercial real estate


9,675Residential real estate


5,909Commercial and industrial


12,321$
35,590Cash flows expected to be collected at acquisition:Construction, land development and other land

$
5,743Commercial real estate


5,563Residential real estate


5,327Commercial and industrial


8,083$
24,716Fair Value of acquired loans at acquisition:Construction, land development and other land

$
5,696Commercial real estate


5,524Residential real estate


5,244Commercial and industrial


7,676$
24,140  136




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  NOTE 6.
    PREMISES
    AND EQUIPMENT    ($ in 000s)

2010Leasehold improvements

$
835Equipment


138Furniture and fixtures


309Vehicles


181,300Less: accumulated depreciation and amortization


(72
)$
1,228     NOTE 7.
    GOODWILL
    AND INTANGIBLES        ($ in 000s)

December 31, 2010Balance at beginning of period

$
Goodwill from business combination


5,633Balance at end of period

$
5,633       ($ in 000s)

December 31, 2010Balance at beginning of period

$
Core deposit intangible from business combinations


784Amortization expense


(16
)Balance at end of period

$
768Gross carrying amount

$
784Accumulated amortization


(16
)Net book value

$
768  137




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Years ending December 31,($ in 000s)

Amount2011

$
972012


922013


872014


832015


79Thereafter


330$
768   NOTE 8.
    DEPOSITS    ($ in 000s)

December 31, 2010Demand deposits, noninterest bearing

$
67,087NOW and money market accounts


56,509Savings deposits


1,273Time certificates, $100 or more


30,498Other time certificates


4,919Total

$
160,286       NOTE 9.
    EMPLOYEE
    BENEFIT PLAN      NOTE 10.
    INCOME
    TAX MATTERS  Income taxes
 138




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
        2010


2009Deferred tax assets:Net operating loss carry forward

$
5,889


$
4,550Organization costs and start up costs


5,576



175Allowance for loan losses, unfunded commitments and loan
    discounts


4,250



Stock warrants and stock options


2,331



490Accrued expenses


769



Premises and equipment


76



18,891



5,215Deferred tax liabilities:Cored Deposit Intangible


(261
)Prepaid expenses


(122
)


Deferred loan costs


(109
)


Net deferred tax asset


18,399



5,215Valuation allowance


(18,399
)


(5,215
)$



$
    139




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    2010


2009


2008Current:Federal

$



$



$
State


















Deferred:Federal


(682
)


(2,685
)


(2,314
)State










Less valuation allowance


682



2,685



2,314Income tax benefit

$



$



$
     2010


2009


2008Computed expected tax (benefit)

$
(2,601
)

$
(5,065
)

$
(528
)Nondeductible expenses


904



771



Other


1,015



1,609



(1,786
)Deferred tax asset valuation allowance

$
682


$
2,685


$
2,314       NOTE 11.
    TRANSACTIONS
    WITH RELATED PARTIES  Loans
    ($s in 000)

2010Balance assumed at merger

$
2,480New loans


25Repayments


(69
)Ending balances

$
2,436  140




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
      Services
    Agreement
  out-of-pocket day-to-day
    Payment
    for Due Diligence Services
  and/or
  NOTE 12.
    STOCK-BASED
    COMPENSATION    Restricted
    Stock Programs
     141




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
          Stock
    Option Program
   142




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
        Weighted AverageShares

Exercise PriceWLBC Stock Options Converted from Bank Stock Options at
    October 28, 2010


246,947


$
21.01Granted






Exercised






Forfeited or expired






Outstanding, December 31, 2010


246,947


$
21.01Exercisable, end of period


146,728


$
21.01       NOTE 13.
    WARRANTS    lock-up
 143




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
    Warrants
    and Private Shares Restructuring
  30-day
     144




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
             145




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
      Bank
    Warrant Exchange
      NOTE 14.
    REGULATORY
    CAPITAL MATTERS   146




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
        December 31, 2010To Be WellMinimum Required

Capitalized Under

Minimum Requiredfor Capital Adequacy

Prompt Corrective

Under RegulatoryActual

Purposes

Action Regulations

Agreements($ in 000s)

Amount

Ratio

Amount

Ratio

Amount

Ratio

Amount

RatioTotal capital (to risk-weighted assets)Consolidated

$
87.8



68.8
%

$
10.2



8.0
%


N/A



N/A



N/A



N/AService1st Bank

$
36.3



31.0
%

$
9.4



8.0
%

$
11.7



10.0
%

$
14.1



12.0
%Tier 1 capital (to risk-weighted assets)Consolidated

$
87.4



68.4
%

$
5.1



4.0
%


N/A



N/A



N/A



N/AService1st Bank

$
35.9



30.6
%

$
4.7



4.0
%

$
7.0



6.0
%

$




N/ATier 1 capital (to average assets)Consolidated

$
87.4



30.5
%

$
11.5



4.0
%


N/A



N/A



N/A



N/AService1st Bank

$
35.9



18.1
%

$
7.9



4.0
%

$
9.9



5.0
%

$
19.8



10.0
%        147




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  NOTE 15.
    COMMITMENTS
    AND CONTINGENCIES  Contingencies
          Indemnifications
   148




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  Financial
    instruments with off-balance sheet risk
      ($ in 000s)

2010Unused lines of credit

$
18,504Standby letters of credit

$
590   case-by-case
        Lease
    commitments
  5-year
  ($ in 000s)2011

$
9102012


7422013


444$
2,096    149




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  Concentrations
      Lines
    of credit
    NOTE 16.
    PARENT
    COMPANY ONLY CONDENSED FINANCIAL INFORMATION    CONDENSED
    BALANCE SHEETS
    December 31
  2010


2009($ in 000s)ASSETSCash and cash equivalents

$
53,476


$
87,969Investment in banking subsidiaries


42,299



Other assets


162



551Total assets

$
95,937


$
88,520LIABILITIES AND EQUITYAccrued expenses and other liabilities

$
292


$
628Contingent consideration


1,816



Shareholders equity


93,829



87,892Total liabilities and shareholders equity

$
95,937


$
88,520  150




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
    Years ended December 31
  2010


2009


2008Interest and other income

$
8


$
139


$
5,691Interest and other expense


7,844



15,037



7,244Income (loss) before income tax and undistributed subsidiary
    income


(7,836
)


(14,898
)


(1,553
)Income tax expense (benefit)










Equity in undistributed subsidiary income


186







Net income (loss)

$
(7,650
)

$
(14,898
)

$
1,553Other comprehensive income

$



$



$
  151




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    STATEMENTS OF CASH FLOWS
    Years ended December 31
  2010


2009


2008Cash flows from operating activitiesNet (loss) income

$
(7,650
)

$
(14,898
)

$
(1,552
)Adjustments:Equity in undistributed subsidiary income


(186
)






Stock-based compensation expense


1,771



869



4,625Interest earned on cash held in trust






(86
)


(5,664
)Change in other assets


389



(294
)


Change in other liabilities


(365
)


(54
)


355Accrued offering costs










499Net cash from operating activities


(6,041
)


(14,463
)


2,735Cash flows from investing activitiesCash withdrawn from trust account for working capital






316,778



4,100Investments in subsidiaries


(25,000
)






Net cash from investing activities


(25,000
)






Cash flows from financing activitiesPayment of redemption of common shares






(211,765
)


Payment of underwriters discount and offering costs






(4,027
)


Cash payment for warrant exchange


(2,884
)






Redemption of dissenters shares


(567
)


Cash payment for fractional shares


(1
)


Net cash from financing activities


(3,452
)


(215,792
)


Net change in cash and cash equivalents


(34,493
)


86,523



1,365Beginning cash and cash equivalents


87,969



1,446



81Ending cash and cash equivalents

$
53,476


$
87,969


$
1,446  152




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  NOTE 17.
    EARNINGS
    PER SHARE          ($s in 000s, except per share)

December 31, 2010

December 31, 2009

December 31, 2008Numerator:Net (loss) income available to common stockholders

$
(7,650
)

$
(14,994
)

$
(1,998
)Denominator:Weighted-average common shares outstanding


11,680,609



33,169,481



39,936,064Dilutive effect of Restricted Stock Units, Warrants and Stock
    Options










Weighted-average common shares outstanding, assuming dilution


11,680,609



33,169,481



39,936,064Net (loss) income per shareBasic

$
(0.65
)

$
(0.45
)

$
(0.05
)Diluted










    153




---



##### Table of Contents



WESTERN
    LIBERTY BANCORP
  NOTES TO FINANCIAL
    STATEMENTS  (Continued)
  NOTE 18.
    SUMMARIZED
    QUARTERLY FINANCIAL INFORMATION
    (UNAUDITED)    ($ in 000s, except per share)

Quarter EndedYear Ended December 31, 2010

December 31, 2010

Sept. 30, 2010

June 30, 2010

March 31, 2010Net interest income

$
3


$
1


$
2


$
2Operating expenses


5,025



(613
) (A)


1,676



1,756Equity in undistributed earnings of subsidiary


186











Net (loss) income

$
(4,836
)


614


$
(1,674
)

$
(1,754
)Net (loss) income per common share, basic

$
(0.35
)

$
0.06


$
(0.15
)

$
(0.16
)Net (loss) income per common share, diluted

$
(0.35
)

$
0.01


$
(0.15
)

$
(0.16
)     (A)
    
    For the quarter ended September 30, 2010, the Company
    reversed $1,850,000 of stock compensation expense (as more fully
    discussed in the September 30, 2010,
    Form 10-Q,
    Note 4) which offset the recorded other expenses of
    approximately $1,237,000. As a result of this reversal the
    Company reported a net profit of $614,000.  Quarter EndedDecember 31, 2009

September 30, 2009

June 30, 2009

March 31, 2009Year Ended December 31, 2009Operating Expenses

$
(6,489
)

$
(5,064
)

$
2,563
)

$
(922
)Interest income


52



6



11



71Net (loss) income for the period

$
(6,437
)

$
(5,058
)

$
(2,552
)

$
(851
)Weighted average number of common shares outstanding not subject
    to possible redemption, basic


33,169,481



39,936,064



39,936,064



39,936,064Weighted average number of common shares outstanding not subject
    to possible redemption, diluted


33,169,481



39,936,064



39,936,064



39,936,064Net (loss) income per common share not subject to possible
    redemption, basic

$
(0.19
)

$
(0.13
)

$
(0.06
)

$
(0.02
)Net income per common share not subject to possible redemption,
    diluted

$
(0.19
)

$
(0.13
)

$
(0.06
)

$
(0.02
)  154




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm                 155




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm
               156




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  BALANCE SHEETS
  (In thousands, except for per share amounts)

October 28, 2010


December 31, 2009AssetsCash and due from banks

$
10,164


$
13,686Interest-bearing deposits in banks


4,927



35,947Cash and cash equivalents


15,091



49,633Certificates of deposits


31,928



9,313Securities, available for sale


2,850



7,434Securities, held to maturity (fair value 2010: $7,842and 2009: $10,677 )


7,582



10,201Loans, net of allowance for loan losses 2010: $9,418 and2009: $6,404


115,986



130,563Premises and equipment, net


1,284



1,634Accrued interest receivable


605



529Other real estate owned


2,403



Other assets


2,227



2,453Total assets

$
179,956


$
211,760Liabilities and Stockholders EquityDeposits:Non-interest bearing demand

$
68,575


$
56,463Interest bearing:Demand


29,018



25,094Savings and money market


29,381



43,209Time, $100 or more


30,204



54,316Other time


4,888



6,238Total deposits


162,066



185,320Accrued interest payable and other liabilities


1,452



1,921Total liabilities


163,518



187,241Commitments and contingencies (Note 8)Stockholders Equity:Common stock, par value: $.01; shares authorized: 25,000,000;
    shares issued: 50,811; and shares outstanding October 28,
    2010 and
    December 31, 2009: 50,811 less 1,000 shares held in
    treasury


1



1Additional paid-in capital


52,642



52,009Accumulated deficit


(35,410
)


(26,693
)Accumulated other comprehensive loss, net


(20
)


(23
)Less cost of treasury stock, 1,000 shares


(775
)


(775
)Total stockholders equity


16,438



24,519Total liabilities and stockholders equity

$
179,956


$
211,760    157




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADASTATEMENTS OF OPERATIONSFOR THE PERIOD JANUARY 1, 2010
    THROUGH OCTOBER 28, 2010,
    AND YEARS ENDED 2009 AND 2008
  (In thousands, except for per share amounts)

2010


2009


2008Interest and dividend income:Loans, including fees

$
5,801


$
8,202


$
7,837Securities, taxable


472



646



355Federal funds sold and other


347



195



305Total interest and dividend income


6,620



9,043



8,497Interest expense:Deposits


1,147



2,663



1,963Repurchase sweep agreements






13



59Total interest expense


1,147



2,676



2,022Net interest income


5,473



6,367



6,475Provision for loan losses


6,329



15,666



3,670Net interest (loss) income after provision for loan losses


(856
)


(9,299
)


2,805Non-interest income:Service charges


382



328



196Loan and late fees


17



98



99Gain on sale of securities


13



17



Other


95



71



46507



514



341Non-interest expense:Salaries and employee benefits


3,536



3,875



5,029Occupancy, equipment and depreciation


1,360



1,673



1,664Computer service charges


243



328



313Professional fees


1,605



1,026



256Advertising and business development


79



88



157Insurance


705



500



145Telephone


87



101



104Stationery and supplies


26



32



45Director fees


34



44



23Loss on disposition of equipment






3



Other real estate owned


654







Provision for unfunded commitments


(471
)


498



140Other


510



425



3878,368



8,593



8,263Net loss

$
(8,717
)

$
(17,378
)

$
(5,117
)Loss per share:Basic and diluted

$
(175.00
)

$
(342.86
)

$
(100.70
)    158




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##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
 STATEMENTS
    OF STOCKHOLDERS EQUITY AND COMPREHENSIVE LOSSFOR THE PERIOD JANUARY 1, 2010
    THROUGH OCTOBER 28, 2010, 
    AND YEARS ENDED DECEMBER 31, 2009 AND 2008 AccumulatedAdditional





OtherComprehensive


Common Stock (Issued)


Paid-In


Accumulated


Comprehensive


Treasury Stock(In thousands, except for per share amount)

Loss


Shares


Amount


Capital


Deficit


Loss


Shares


Amount


TotalBalance, January 1, 2008






50,811


$
1


$
51,207


$
(4,198
)

$







$



$
47,010Stock option expense














423



















423Net loss

$
(5,117
)














(5,117
)














(5,117
)Balance, December 31, 2008


(5,117
)


50,811



1



51,630



(9,315
)














42,316Stock option expense














379



















379Treasury stock transaction


























1,000



(775
)


(775
)Net loss


(17,378
)














(17,378
)














(17,378
)Unrealized Loss on securities available for sale, net of taxes


(23
)


















(23
)










(23
)Balance, December 31, 2009


(17,401
)


50,811



1



52,009



(26,693
)


(23
)


1,000



(775
)


24,519Stock option expense














633



















633Net loss


(8,717
)














(8,717
)














(8,717
)Unrealized Loss on securities available for sale, net of taxes


3



















3











3Balance, October 28, 2010

$
(8,714
)


50,811


$
1


$
52,642


$
(35,410
)

$
(20
)


1,000


$
(775
)

$
16,438    159




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##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
 STATEMENTS
    OF CASH FLOWSFOR THE PERIOD JANUARY 1, 2010
    THROUGH OCTOBER 28, 2010, 
    AND YEARS ENDED 2009 AND 2008 (In thousands, except for per share amount)

2010


2009


2008Cash Flows from Operating Activities:Net loss

$
(8,717
)

$
(17,378
)

$
(5,117
)Adjustments to reconcile net loss to net cash used in operating
    activities:Depreciation of premises and equipment


422



633



598Amortization of securities premiums/discounts, net


48



27



7Provision for loan losses


6,329



15,666



3,670Stock warrants and stock option expense


633



379



423Loss on disposition of equipment






3



Gain on sale securities


(13
)


(17
)


Increase in accrued interest receivable


(76
)


(98
)


(48
)Decrease (increase) in other assets


231



(1,708
)


(392
)(Decrease) increase in accrued interest payable and other
    liabilities


(469
)


567



(14
)Net cash used in operating activities


(1,612
)


(1,926
)


(873
)Cash Flows from Investing Activities:Purchases of certificates of deposit


(39,921
)


(31,106
)


Proceeds from certificates of deposit


17,306



21,793



Purchases of securities available for sale


(6,000
)


(14,693
)


Proceeds from sales of securities available for sale


4,000



6,994



Proceeds from maturities of securities available for sale


6,245







Proceeds from principal paydowns of securities available for sale


279



204



Purchase of securities held to maturity






(6,035
)


(10,810
)Proceeds from maturities of securities held to maturity


2,497



7,098



6,171Proceeds from sales of securities held to maturity






499



Proceeds from principal paydowns of securities held to maturity


145







Purchase of premises and equipment


(72
)


(8
)


(141
)Net decrease (increase) in loans


5,845



(12,670
)


(49,453
)Net cash used in investing activities


(9,676
)


(27,924
)


(54,233
)Cash Flows from Financing Activities:Net (decrease) increase in deposits


(23,254
)


75,429



28,554Net (repayments) proceeds from repurchase sweep agreements






(5,933
)


4,362Net cash provided by financing activities


(23,254
)


69,496



32,916(Decrease) increase in cash and cash equivalents


(34,542
)


39,646



(22,190
)Cash and cash equivalents, beginning

$
49,633


$
9,987


$
32,177Cash and cash equivalents, ending

$
15,091


$
49,633


$
9,987Supplementary cash flow information:Interest paid on deposits and repurchase sweep agreements

$
1,242


$
2,662


$
1,959Supplemental disclosure of noncash operating and investing
    activities:Principal paydowns on SBA loan pool securities reclassified to
    other assets

$
3


$
6


$
5Increases to premises and equipment funded by tenant allowances

$



$



$
293Treasury stock received in settlement of an impaired loan

$



$
775


$
Transfers of loans to other real estate owned

$
2,403


$



$
    160




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES
    TO FINANCIAL STATEMENTS
  NOTE 1.
    NATURE OF
    BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
    POLICIES  Nature
    of business
          Use
    of estimates in the preparation of financial
    statements
    Cash
    and cash equivalents
     161




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  Certificates
    of deposit
    Securities
      other-than-temporary
  other-than-temporary other-than-temporarily
  Loans
       162




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
        case-by-case
    Interest
    and fees on loans
       163




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    Transfers
    of financial assets
    Advertising
    costs
    Foreclosed
    assets
    Premises
    and equipment
    YearsFurniture and fixtures

7 - 10Equipment and vehicles

3 - 5Leasehold improvements

5 - 10   Other
    assets
         164




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    Income
    taxes
    Stock
    compensation plans
      Off-balance
    sheet instruments
    Comprehensive
    loss
    Fair
    value measurement
   165




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    Fair
    values of financial instruments
        Certificates
    of deposit
    Securities
    Loans
    Impaired
    loans
   166




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  Accrued
    interest receivable and payable
    Restricted
    stock
    Deposit
    liabilities
    Off-balance
    sheet instruments
    Loss
    per share
      For the PeriodJanuary 1, 2010through October28, 2010


Year Ended December 31,($ in 000s, except for per share amounts)

2010


2009


2008Basic and diluted:Net loss applicable to common stock

$
(8,717
)

$
(17,378
)

$
(5,117
)Weighted average common shares outstanding


49,811



50,683



50,811Loss per share

$
(175.00
)

$
(342.86
)

$
(100.70
)     Reclassifications
   167




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  Recent
    accounting pronouncements
        NOTE 2.
    FAIR
    VALUE ACCOUNTING    Level 1
  Level 2
  Level 3
 168




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  Fair
    value on a recurring basis
    Securities available for sale.
  Fair Value Measurements at October 28, 2010:Quoted Pricesin Active


SignificantMarkets for


Other


SignificantIdentical


Observable


UnobservableAssets


Inputs


Inputs($ in 000s)

Total


(Level 1)


(Level 2)


(Level 3)Securities available for saleUS Agency Securities  GSE

$
1,002


$



$
1,002


$
Collateralized Mortgage Obligation Securities


1,848







1,848



$
2,850


$



$
2,850


$
     Fair Value Measurements at December 31, 2009:Quoted Pricesin Active


SignificantMarkets for


Other


SignificantIdentical


Observable


UnobservableAssets


Inputs


Inputs($ in 000s)

Total


(Level 1)


(Level 2)


(Level 3)Securities available for saleUS Agency Securities  GSE

$
5,229


$



$
5,229


$
Collateralized Mortgage Obligation Securities


2,205







2,205



$
7,434


$



$
7,434


$
   Fair
    value on a nonrecurring basis
   169




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    Fair Value Measurements at October 28, 2010Quoted Pricesin Active


SignificantMarkets for


Other


SignificantIdentical


Observable


UnobservableAssets


Inputs


Inputs($ in 000s)

Total


(Level 1)


(Level 2)


(Level 3)Impaired LoansConstruction, land development, and other land loans

$
3,958


$



$



$
3,958Commercial real estate


4,844











4,844Residential real estate


2,764











2,764Other real estate owned


1,778











1,778$
13,344


$



$



$
13,344   Fair Value Measurements at December 31, 2009Quoted Pricesin Active


SignificantMarkets for


Other


SignificantIdentical


Observable


UnobservableAssets


Inputs


Inputs($ in 000s)

Total


(Level 1)


(Level 2)


(Level 3)Impaired loans

$
6,959










$
6,959   Impaired loans.
     170




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  NOTE 3.
    SECURITIES    Gross


GrossUnrealized


Unrealized($ in 000s)

Amortized Cost


Gains


Losses


Fair ValueSecurities Available for SaleU.S. Agencies  GSE

$
1,002


$



$



$
1,002Collateralized Mortgage Obligation Securities


1,868







(20
)


1,848$
2,870


$



$
(20
)

$
2,850   Gross


GrossUnrecognized


Unrecognized($ in 000s)

Amortized Cost


Gains


Losses


Fair ValueSecurities Held to MaturityCorporate Debt Securities

$
6,924


$
256


$



$
7,180Small Business Administration Loan Pools


658



4







662$
7,582


$
260


$



$
7,842     Gross


GrossUnrealized


Unrealized($ in 000s)

Amortized Cost


Gains


Losses


Fair ValueSecurities Available for SaleU.S. Agencies  GSE

$
5,248


$



$
(19
)

$
5,229Collateralized Mortgage Obligation Securities


2,209







(4
)


2,205$
7,457


$



$
(23
)

$
7,434   Gross


GrossUnrecognized


Unrecognized($ in 000s)

Amortized Cost


Gains


Losses


Fair ValueSecurities Held to MaturityU.S. Agencies  GSE

$
997


$
3


$



$
1,000Corporate Debt Securities


8,390



477







8,867Small Business Administration Loan Pools


814







(4
)


810$
10,201


$
480


$
(4
)

$
10,677   available-for-sale available-for-sale
 171




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  held-to-maturity held-to-maturity
      2010Less than Twelve Months


Over Twelve MonthsGross





GrossUnrealized





Unrealized($ in 000s)

(Losses)


Fair Value


(Losses)


Fair ValueSecurities Available for SaleU.S Agencies  GSE

$



$



$



$
Collateralized Mortgage Obligations Securities


(20
)


1,848







$
(20
)

$
1,848


$



$
Securities Held to MaturityCorporate Debt Securities

$



$



$



$
Small Business Administration Loan Pools














$



$



$



$
   2009Less than Twelve Months


Over Twelve MonthsGross





GrossUnrealized





Unrealized($ in 000s)

(Losses)


Fair Value


(Losses)


Fair ValueSecurities Available for SaleU.S Agencies  GSE

$
(19
)

$
5,229


$



$
Collateralized Mortgage Obligations Securities


(4
)


2,205







$
(23
)

$
7,434


$



$
Securities Held to MaturityU.S Agencies  GSE

$



$



$



$
Corporate Debt Securities














Small Business Administration Loan Pools










(4
)


765$



$



$
(4
)

$
765    172




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    Amortized


Fair($ in 000s)

Cost


ValueSecurities available for saleDue in one year or less

$
993


$
978Due after one year through five years


1,877



1,872$
2,870


$
2,850   Amortized


Fair($ in 000s)

Cost


ValueSecurities held to maturityDue in one year or less

$
3,998


$
4,027Due after one year through five years


2,926



3,153Small Business Administration Loan Pools


658



662$
7,582


$
7,842   NOTE 4.
    LOANS    ($ in 000s)

2010


2009Construction, land development, and other land loans

$
9,225


$
20,279Commercial real estate


62,963



68,523Residential real estate


10,282



1,367Commercial and industrial


42,778



46,470Consumer


136



342Less: net deferred loan fees


20



(14
)125,404



136,967Less: allowance for loan losses


(9,418
)


(6,404
)$
115,986


$
130,563  173




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    ($ in 000s)

2010


2009Impaired loans without a valuation allowance

$
9,269


$
6,528Impaired loans with a valuation allowance

$
17,631


$
2,828Total impaired loans

$
26,900


$
9,356Related allowance for loan losses on impaired loans

$
5,493


$
841Total non-accrual loans

$
20,327


$
7,799Loans past due 90 days or more and still accruing

$



$
   ($ in 000s)

2010


2009


2008Average balance during the year on impaired loans

$
28,943


$
14,939


$
2,001Interest income recognized on impaired loans

$
147


$
103


$
Interest income recognized on cash basis

$



$



$
         ($ in 000s)

2010


2009


2008Balance, beginning

$
6,404


$
2,883


$
922Provisions charged to operating expense


6,329



15,666



3,670Recoveries of amounts charged off


615



9



3Less amounts charged off


(3,930
)


(12,154
)


(1,712
)Balance, ending

$
9,418


$
6,404


$
2,883  174




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  NOTE 5.
    PREMISES
    AND EQUIPMENT    ($ in 000s)

2010


2009Leasehold improvements

$
1,733


$
1,733Equipment


885



813Furniture and fixtures


612



612Vehicles


56



563,286



3,214Less: accumulated depreciation and amortization


(2,002
)


(1,580
)$
1,284


$
1,634     NOTE 6.
    INCOME
    TAX MATTERS  Income taxes
   175




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    ($ in 000s)

2010


2009Deferred tax assets:Net operating loss carryforward

$
7,287


$
7,453Organization costs


313



337Allowance for loan losses and unfunded commitments


2,393



675Stock warrants and stock options


333



242Accrued expenses


646



303Other


74



8911,046



9,099Deferred tax liabilities:Prepaid loan fees


(96
)


(109
)Deferred loan costs


(114
)


(114
)Net deferred tax asset


10,836



8,876Valuation allowance


(10,836
)


(8,876
)$



$
       ($ in 000s)

2010


2009


2008Current:Federal

$



$



$
State


















Deferred:Federal


1,960



5,821



1,656State










1,960



5,821



1,656Less valuation allowance


(1,960
)


(5,821
)


(1,656
)Income tax benefit

$



$



$
  176




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    ($ in 000s)

2010


2009


2008Computed expected tax (benefit)

$
(2,964
)

$
(6,082
)

$
(1,790
)Nondeductible expenses


588



100



111Other


416



161



23Deferred tax asset valuation allowance


1,960



5,821



1,656$



$



$
     NOTE 7.
    DEPOSITS        NOTE 8.
    COMMITMENTS
    AND CONTINGENCIES  Contingencies
    Financial
    instruments with off-balance sheet risk
     177




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
      ($ in 000s)

2010


2009Unfunded commitments under lines of credit

$
15,965


$
25,035Standby letters of credit


695



1,408$
16,660


$
26,443   lines-of-credit, lines-of-credit
      Lease
    commitments
  5-year
  ($ in 000s)2010

$
1492011


9102012


7422013


444$
2,245     Concentrations
   178




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    Lines
    of credit
    NOTE 9.
    STOCK
    AWARDS      January 14,

April 17,

August 11,2009 Stock

2008 Stock

2008 StockOption Grants

Option Grants

Option GrantsExpected life in years


7.5



7.5



7.5Risk-free interest rate


1.72
%


3.27
%


3.57
%Dividends rate


0.00
%


0.00
%


0.00
%Volatility


80.20
%


35.54
%


44.21
%Fair value per award

$
745.03


$
450.61


$
523.04     Stock Warrants


Stock OptionsWeighted





WeightedAverage





AverageShares


Exercise Price


Shares


Exercise PriceOutstanding, January 1, 2010


900


$
1,000



6,034


$
1,000Granted














Exercised














Forfeited or expired










(845
)


1,000Outstanding, October 28, 2010


900


$
1,000



5,189


$
1,000Exercisable, end of period


900


$
1,000



3,101


$
1,000  179




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
    Stock Warrants


Stock OptionsWeighted





WeightedAverage





AverageShares


Exercise Price


Shares


Exercise PriceOutstanding, January 1, 2009


900


$
1,000



6,381


$
1,000Granted










76



1,000Exercised














Forfeited or expired










(423
)


1,000Outstanding, December 31, 2009


900


$
1,000



6,034


$
1,000Exercisable, end of period


900


$
1,000



1,634


$
1,000     Stock Warrants


Stock OptionsWeighted





WeightedAverage





AverageShares


Exercise Price


Shares


Exercise PriceOutstanding, January 1, 2008


900


$
1,000



3,710


$
1,000Granted










3,842



1,000Exercised














Forfeited or expired










(1,171
)


1,000Outstanding, December 31, 2008


900


$
1,000



6,381


$
1,000Exercisable, end of period


900


$
1,000



576


$
1,000          180




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  NOTE 10.
    REGULATORY
    CAPITAL          October 28, 2010For Capital



Required UnderActual

Adequacy Purposes

To Be Well Capitalized

Regulatory Agreements($ in 000s)

Amount

Ratio

Amount

Ratio

Amount

Ratio

Amount

RatioTotal Capital (to Risk-Weighted Assets)

$
18,164



14.1
%

$
10,319



8.0
%

$
12,899



10.0
%

$
15,479



12.0
%Tier 1 Capital (to Risk- Weighted Assets)


16,451



12.8
%


5,160



4.0
%


7,739



6.0
%






N/ATier 1 Capital (to Average Assets)


16,451



8.7
%


7,548



4.0
%


9,435



5.0
%


16,040



8.5
%   181




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  December 31, 2009For Capital



Required UnderActual

Adequacy Purposes

To Be Well Capitalized

Regulatory Agreements($ in 000s)

Amount

Ratio

Amount

Ratio

Amount

Ratio

Amount

RatioTotal Capital (to Risk-Weighted Assets)

$
26,493



17.6
%

$
12,061



8.0
%

$
15,077



10.0
%

$




N/ATier 1 Capital (to Risk- Weighted Assets)


24,542



16.3
%


6,031



4.0
%


9,046



6.0
%






N/ATier 1 Capital (to Average Assets)


24,542



11.0
%


8,961



4.0
%


11,202



5.0
%


17,923



8.0
%     NOTE 11.
    EMPLOYEE
    BENEFIT PLAN    NOTE 12.
    TRANSACTIONS
    WITH RELATED PARTIES    ($ in 000s)

2010


2009Balance, beginning

$
6,626


$
14,788New loans


455



770Repayments


(862
)


(2,468
)Other Changes






(6,464
)Balance, ending

$
6,219


$
6,626        182




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  NOTE 13.
    STOCKHOLDERS
    EQUITY    Treasury
    Stock
    NOTE 14.
    FAIR
    VALUE OF FINANCIAL INSTRUMENTS    2010

2009Carrying



Carrying($ in 000s)

Amount

Fair Value

Amount

Fair ValueFinancial assets:Cash and due from banks

$
10,164


$
10,164


$
13,686


$
13,686Interest-bearing deposits in banks


4,927



4,927



35,947



35,947Certificates of deposits


31,928



31,928



9,313



9,313Restricted Stock


658



N/A



487



487Securities available for sale


2,850



2,850



7,434



7,434Securities held to maturity


7,582



7,842



10,201



10,677Loans, net


115,986



109,589



130,563



127,148Accrued interest receivable


605



605



529



529Financial liabilities:Deposits


162,066



162,112



185,320



185,320Accrued interest payable


44



44



139



139   Fair
    Value of Commitments
    Interest
    Rate Risk
   183




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
  NOTE 15.
    QUARTERLY
    DATA  (UNAUDITED)  2010Period Ended October 28




Third


Second


First($ in 000s, except for per share amounts)

October


Quarter


Quarter


QuarterInterest and dividend income

$
603


$
1,862


$
1,947


$
2,207Interest expense


64



286



380



417Net interest income


539



1,576



1,567



1,790Provision for loan loss


991



707



1,713



1,518Net interest income (loss) after provisions for loan losses


(452
)


869



(146
)


272Noninterest income


41



160



156



150Noninterest expenses


1,447



2,445



2,236



2,239Net Loss

$
(1,858
)

$
(1,416
)

$
(2,226
)

$
(1,817
)Earnings (loss) per share:Basic and Diluted

$
(37.30
)

$
(28.43
)

$
(44.69
)

$
(36.48
)   2009Year Ended December 31

Fourth


Third


Second


First($ in 000s, except for per share amounts)

Quarter


Quarter


Quarter


QuarterInterest and dividend income

$
2,200


$
2,237


$
2,296


$
2,310Interest expense


558



752



738



628Net interest income


1,642



1,485



1,558



1,682Provision for loan loss


11,274



3,428



365



598Net interest income (loss) after provisions for loan losses


(9,632
)


(1,943
)


1,193



1,084Noninterest income


222



127



86



79Noninterest expenses


2,943



1,990



1,826



1,834Net Loss

$
(12,353
)

$
(3,806
)

$
(547
)

$
(671
)Earnings (loss) per share:Basic and Diluted

$
(243.74
)

$
(75.09
)

$
(10.79
)

$
(13.24
)   NOTE 16
    SUBSEQUENT
    EVENTS   184




---



##### Table of Contents



SERVICE1ST
    BANK OF NEVADA
  NOTES TO
    FINANCIAL STATEMENTS  (Continued)
       185




---



##### Table of Contents



Financial statement schedules filed as part of this
    Form 10-K.
  Exhibits. Form 10-K
  ExhibitNumbers2
.1

Agreement and Plan of Merger, dated as of November 6, 2009,
    by and among Western Liberty Bancorp., WL-S1 Interim Bank,
    Service1st Bank of Nevada and Curtis W. Anderson, as Former
    Stockholders Representative (incorporated by reference to
    Exhibit 2.1 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 9, 2009)2
.2

First Amendment to the Agreement and Plan of Merger, dated as of
    June 21, 2010, by and among Western Liberty Bancorp., WL-S1
    Interim Bank, Service1st Bank of Nevada and Curtis W. Anderson,
    as Former Stockholders Representative (incorporated by
    reference to Exhibit 2.1 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    June 24, 2010)3
.1

Second Amended and Restated Certificate of Incorporation
    (incorporated by reference to Exhibit 3.2 to the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    October 9, 2009)3
.2

Amended and Restated Bylaws (incorporated by reference to
    Exhibit 3.2 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)4
.1

Specimen Common Stock Certificate (incorporated by reference to
    Exhibit 4.7 to the
    Form S-3,
    filed by WLBC with the Securities and Exchange Commission on
    November 16, 2009)4
.2

Founders Shares Restructuring Agreement, dated as of
    July 20, 2009, between Global Consumer Acquisition Corp.
    and Hayground Cove Asset Management LLC (incorporated by
    reference to Exhibit 4.2 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    July 22, 2009)4
.4

Letter Agreement, dated as of September 23, 2010, between
    Western Liberty Bancorp and the signatories thereto
    (incorporated by reference to Exhibit 4.1 the Current
    Report on
    Form 8-K,
    File No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    September 23, 2010)4
.5

Second Amended and Restated Warrant Agreement, dated as of
    September 27, 2010, between Western Liberty Bancorp and
    Continental Stock Transfer &Trust Company
    (incorporated by reference to Exhibit 4.1 the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    September 28, 2010)10
.1*

Form of Indemnification Agreement between WLBC and each of the
    directors and officers of WLBC (incorporated by reference to
    Exhibit 10.10 to Amendment No. 1 to the
    Form S-1,
    File No. 333-144799,
    filed by WLBC with the Securities and Exchange Commission on
    September 6, 2007)10
.2*

Settlement Agreement and General Release, dated
    December 23, 2008, between WLBC and Scott LaPorta
    (incorporated by reference to Exhibit 10.13 to Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    December 29, 2008) 186




---



##### Table of Contents



ExhibitNumbers10
.3

Director Resignation Agreement, dated December 23, 2008,
    between WLBC, Robert M. Foresman, Carl H. Hahn, Philip A.
    Marineau and Steven Westly (incorporated by reference to
    Exhibit 10.14 to Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    December 29, 2008)10
.4

Second Amended and Restated Sponsor Support Agreement, dated as
    of August 13, 2009, by and between Global Consumer
    Acquisition Corp. and Hayground Cove Asset Management LLC
    (incorporated by reference to Exhibit 10.1 to the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    August 14, 2009)10
.5*

Employment Agreement, dated as of November 6, 2009, by and
    between Western Liberty Bancorp and Richard Deglman
    (incorporated by reference to Exhibit 10.4 to the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 9, 2009)10
.6*

Second Amended and Restated Employment Agreement, dated as of
    December 18, 2009, by and between Western Liberty Bancorp
    and George A. Rosenbaum, Jr. (incorporated by reference to
    Exhibit 10.1 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    December 24, 2009)10
.7*

Letter Agreement, dated as of October 28, 2010, between
    Western Liberty Bancorp and Jason N. Ader (incorporated by
    reference to Exhibit 10.1 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)10
.8*

Letter Agreement, dated as of October 28, 2010, between
    Western Liberty Bancorp and Daniel B. Silvers (incorporated by
    reference to Exhibit 10.1 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)10
.9*

Letter Agreement, dated as of October 28, 2010, between
    Western Liberty Bancorp and Andrew P. Nelson
    (incorporated by reference to Exhibit 10.1 to the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)10
.10*

Letter Agreement, dated as of October 28, 2010, between
    Western Liberty Bancorp and Michael Tew (incorporated by
    reference to Exhibit 10.1 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)10
.11*

Letter Agreement, dated as of October 28, 2010, between
    Western Liberty Bancorp and Laura Conover-Ferchak
    (incorporated by reference to Exhibit 10.1 to the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)10
.12

Expense Sharing Agreement, dated as of October 29, 2010,
    between Western Liberty Bancorp and Service1st Bank of Nevada
    (incorporated by reference to Exhibit 10.1 to the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)10
.13

Tax Allocation Agreement, dated as of October 29, 2010,
    between Western Liberty Bancorp and Service1st Bank of Nevada
    (incorporated by reference to Exhibit 10.1 to the Current
    Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    November 3, 2010)10
.15*

Amended and Restated Employment Agreement, dated as of
    February 8, 2010, by and between Western Liberty Bancorp
    and William E. Martin (incorporated by reference to
    Exhibit 10.1 to the Current Report on
    Form 8-K,
    File
    No. 001-33803,
    filed by WLBC with the Securities and Exchange Commission on
    February 8, 2010)14
.1

Code of Conduct and Ethics**21


Subsidiaries of the registrant: Service1st Bank of Nevada, a
    Nevada corporation located in Las Vegas, Nevada, is the
    sole subsidiary of Western Liberty Bancorp** 187




---



##### Table of Contents



ExhibitNumbers31
.1**

Certification of Periodic Report by the Chief Executive Officer
    pursuant to
    Rule 13(a)-14(a)
    of the Securities Exchange Act of 193431
.2**

Certification of Periodic Report by the Chief Financial Officer
    pursuant to
    Rule 13(a)-14(a)
    of the Securities Exchange Act of 193432
.1**

Certification of Periodic Report by the Chief Executive Officer
    pursuant to Section 906 of the Sarbanes-Oxley Act of 200232
.2**

Certification of Periodic Report by the Chief Financial Officer
    pursuant to Section 906 of the Sarbanes-Oxley Act of 200299
.1

Consent Order of Federal Deposit Insurance Corporation and the
    Nevada Financial Institutions Division, dated as of
    September 1, 2010, In the Matter of
    Service1st

    Bank of Nevada,
    FDIC-10-512b
    (incorporated by reference to Exhibit 99.1 to the
    Form S-1,
    Amendment No. 1, File No. 333-170862, filed by WLBC with
    the Securities and Exchange Commission on March 30, 2011)     *
    
    Management contract or compensatory plan or arrangement**
    
    filed herewith 188




---



##### Table of Contents



SIGNATURES
      By:
    /s/  William
    E. Martin        Signature

Title

Date/s/  Michael
    B. FrankelMichael
    B. Frankel

Chairman

March 30, 2011/s/  Terrence
    L. WrightTerrence
    L. Wright

Vice Chairman

March 30, 2011/s/  Jason
    N. AderJason
    N. Ader

Director

March 30, 2011/s/  Richard
    A.C. ColesRichard
    A.C. Coles

Director

March 30, 2011/s/  Robert
    G. GoldsteinRobert
    G. Goldstein

Director

March 30, 2011/s/  Curtis
    W. Anderson, CPACurtis
    W. Anderson, CPA

Director

March 30, 2011/s/  Steven
    D. HillSteven
    D. Hill

Director

March 30, 2011/s/  William
    E. MartinWilliam
    E. Martin

Director and Chief Executive Officer (Principal Executive
    Officer)

March 30, 2011/s/  George
    A. Rosenbaum, Jr.George
    A. Rosenbaum, Jr.

Chief Financial Officer (Principal Accounting and Financial
    Officer)

March 30, 2011  189