| [X] | QUARTERLY      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF      1934 |
|-----|---------------------------------------------------------------------------------------------------|

| [  ] | TRANSITION      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF      1934 |
|----------------|----------------------------------------------------------------------------------------------------|

|   | For      the transition period from _____ to_____ |
|--------|---------------------------------------------------|

|  HOME      FEDERAL BANCORP, INC. |
|---------------------------------------|

|  Maryland                                                                                   |           26-0886727                                                                                                                                                                              |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  (State or      other jurisdiction of incorporation                                                                                                                                                                                                                                                                                                                                                                                                                           |  (I.R.S.      Employer                                                                                                                                                                                                     |
|  or      organization)                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  I.D.      Number)                                                                                                                                                                                                         |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                            |
| 500      12th Avenue      South, Nampa,      Idaho                                                                                                                                                                                                                                                                                          |                                  83651                |
|  (Address of      principal executive offices)                                                                                                                                                                                                                                                                                                                                                                                                                 |  (Zip      Code)                                                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                            |
|  Registrant’s      telephone number, including area code:                                                                                                                                                                                                                                                                                                                                                                                                          |   (208)      466-4634                                                                                                                                                                                                 |

----

|   | Consolidated      Balance Sheets as of |
|--------|----------------------------------------|

|   | Consolidated      Statements of Income for the Three and Nine  Months |
|--------|-----------------------------------------------------------------------|

|   | Consolidated      Statements of Changes in Stockholders’ Equity  and |
|--------|----------------------------------------------------------------------------|

|   |         Comprehensive      Income for the Nine Months |
|--------|-----------------------------------------------------------------------------------------------|

|                                          ended June 30, 2008 and      for the Year Ended September 30, 2007 |   |                                                      3 |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Consolidated      Statements of Cash Flows for the NineMonths |
|--------|---------------------------------------------------------------|

|              ended June 30, 2008 and      2007 |   |                                                      5 |
|-----------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                   Selected Notes to Interim Consolidated FinancialStatements |   |                                                      7 |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| HOME      FEDERAL BANCORP, INC. AND SUBSIDIARYCONSOLIDATED      BALANCE SHEETS(In      thousands, except share data) (Unaudited) | June      30, 2008 |   | September      30, 2007 |
|----------------------------------------------------------------------------------------------------------------------------------|-------------------------|--------|-------------------------|
| ASSETS                                                                                                                           |                    |   |                    |
| Cash      and amounts due from depository institutions                                                                           | $  25,187     |   | $  20,588     |
| Certificate      of deposit in correspondent bank                                                                                | 5,000                   |   | --                      |
| Mortgage-backed      securities available for sale, at fair value                                                                | 194,753                 |   | 162,258                 |
| Federal      Home Loan Bank of Seattle (“FHLB”) stock, at cost                                                       | 9,591                   |   | 9,591                   |
| Loans      receivable, net of allowance for loan losses      of  $3,801                                                |                    |   |                    |
| and      $2,988                                                                                                                  | 468,343                 |   | 480,118                 |
| Loans      held for sale                                                                                                         | 3,971                   |   | 4,904                   |
| Accrued      interest receivable                                                                                                 | 2,799                   |   | 2,804                   |
| Property      and equipment, net                                                                                                 | 14,356                  |   | 12,364                  |
| Mortgage      servicing rights, net                                                                                              | 1,840                   |   | 2,047                   |
| Bank      owned life insurance                                                                                                   | 11,482                  |   | 11,168                  |
| Real      estate and property owned                                                                                              | 707                     |   | 549                     |
| Deferred      income tax asset, net                                                                                              | 1,765                   |   | 1,245                   |
| Other      assets                                                                                                                | 2,154                   |   | 2,318                   |
| TOTAL      ASSETS                                                                                                                | $741,948                |   | $709,954                |
|                                                                                                                             |                    |   |                    |
| LIABILITIES      AND STOCKHOLDERS’ EQUITY                                                                                  |                    |   |                    |
|                                                                                                                             |                    |   |                    |
| LIABILITIES                                                                                                                      |                    |   |                    |
| Deposit      accounts:                                                                                                           |                    |   |                    |
| Noninterest-bearing      demand deposits                                                                                         | $  35,258     |   | $  38,643     |
| Interest-bearing      demand deposits                                                                                            | 140,401                 |   | 127,659                 |
| Savings      deposits                                                                                                            | 26,409                  |   | 23,116                  |
| Certificates      of deposit                                                                                                     | 180,274                 |   | 215,191                 |
|     Total      deposit accounts                                                                              | 382,342                 |   | 404,609                 |
| Advances      by borrowers for taxes and insurance                                                                               | 657                     |   | 1,605                   |
| Interest      payable                                                                                                            | 580                     |   | 731                     |
| Deferred      compensation                                                                                                       | 5,028                   |   | 4,515                   |
| FHLB      advances                                                                                                               | 145,582                 |   | 180,730                 |
| Other      liabilities                                                                                                           | 4,227                   |   | 5,127                   |
| Total      liabilities                                                                                                           | 538,416                 |   | 597,317            |
|                                                                                                                             |                    |   |                    |
| STOCKHOLDERS’      EQUITY                                                                                                  |                    |   |                    |
| Serial      preferred stock, $.01 par value; 10,000,000 authorized,                                                              |                    |   |                    |
| issued      and outstanding, none                                                                                                | --                      |   | --                      |
| Common      stock, $.01 par value; 90,000,000 authorized,                                                                        |                    |   |                    |
| issued      and outstanding:                                                                                                     | 173                     |   | 152                     |
|       June      30, 2008 – 17,386,517 issued, 17,348,229 outstanding                         |                    |   |                    |
|       Sept.      30, 2007 – 15,278,803 issued, 15,232,243 outstanding                        |                    |   |                    |
| Additional      paid-in capital                                                                                                  | 157,089                 |   | 59,613                  |
| Retained      earnings                                                                                                           | 59,707                  |   | 58,795                  |
| Unearned      shares issued to employee stock ownership plan (“ESOP”)                                                | (11,329)                |   | (3,698)                 |
| Accumulated      other comprehensive loss                                                                                        | (2,108)                 |   | (2,225)                 |
| Total      stockholders’ equity                                                                                            | 203,532                 |   | 112,637                 |
| TOTAL      LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                            | $741,948                |   | $709,954                |
|                                                                                                                             |                    |   |                    |

----

| HOME      FEDERAL BANCORP, INC. AND SUBSIDIARYCONSOLIDATED      STATEMENTS OF INCOME(In      thousands, except share data) (Unaudited) | Three      Months Ended June      30,       |                                             | Nine      Months EndedJune      30, |
|----------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------|--------------------------------------------------|-------------------------------------|
|                                                                                                                                   | 2008                                             |                                             | 2007                                |   | 2008 |   | 2007 |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Interest      and dividend income:                                                                                                     |                                             |                                             |                                |   |   |   |   |
| Loan      interest                                                                                                                     | $      7,544                                     |                                             | $      8,334                        |   | $23,390 |   | $25,331 |
| Investment      interest                                                                                                               | 117                                              |                                             | 179                                 |   | 891 |   | 223 |
| Mortgage-backed      security interest                                                                                                 | 2,372                                            |                                             | 2,123                               |   | 6,463 |   | 6,673 |
| FHLB      dividends                                                                                                                    | 60                                               |                                             | 14                                  |   | 110 |   | 33 |
| Total      interest and dividend income                                                                                                | 10,093                                           |                                             | 10,650                              |   | 30,854 |   | 32,260 |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Interest      expense:                                                                                                                 |                                             |                                             |                                |   |   |   |   |
| Deposits                                                                                                                               | 2,429                                            |                                             | 3,131                               |   | 8,515 |   | 9,146 |
| FHLB      advances                                                                                                                     | 1,752                                            |                                             | 2,207                               |   | 5,594 |   | 6,942 |
| Total      interest expense                                                                                                            | 4,181                                            |                                             | 5,338                               |   | 14,109 |   | 16,088 |
| Net      interest income                                                                                                               | 5,912                                       |               | 5,312                               |   | 16,745 |   | 16,172 |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Provision      for loan losses                                                                                                         | 652                                         |                                        | -                                   |   | 1,317 |   | 71 |
| Net      interest income after provision for loan losses                                                                               | 5,260                                            |                                             | 5,312                               |   | 15,428 |   | 16,101 |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Noninterest      income:                                                                                                               |                                             |                                             |                                |   |   |   |   |
| Service      charges and fees                                                                                                          | 2,396                                            |                                             | 2,318                               |   | 6,731 |   | 6,979 |
| Gain      on sale of loans                                                                                                             | 213                                              |                                             | 491                                 |   | 560 |   | 1,168 |
| Increase      in cash surrender value of bank owned life insurance                                                                     | 106                                              |                                             | 102                                 |   | 314 |   | 301 |
| Loan      servicing fees                                                                                                               | 116                                              |                                             | 134                                 |   | 369 |   | 420 |
| Mortgage      servicing rights, net                                                                                                    | (63)                                             |                                             | (48)                                |   | (206) |   | (223) |
| Other                                                                                                                                  | (33)                                             |                                             | 18                                  |   | 75 |   | 39 |
| Total      noninterest income                                                                                                          | 2,735                                            |                                             | 3,015                               |   | 7,843 |   | 8,684 |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Noninterest      expense:                                                                                                              |                                             |                                             |                                |   |   |   |   |
| Compensation      and benefits                                                                                                         | 3,840                                            |                                             | 3,498                               |   | 11,592 |   | 11,363 |
| Occupancy      and equipment                                                                                                           | 771                                              |                                             | 716                                 |   | 2,242 |   | 2,145 |
| Data      processing                                                                                                                   | 615                                              |                                             | 548                                 |   | 1,668 |   | 1,549 |
| Advertising                                                                                                                            | 241                                              |                                             | 362                                 |   | 786 |   | 940 |
| Postage      and supplies                                                                                                              | 147                                              |                                             | 167                                 |   | 468 |   | 487 |
| Professional      services                                                                                                             | 130                                              |                                             | 209                                 |   | 533 |   | 620 |
| Insurance      and taxes                                                                                                               | 158                                              |                                             | 114                                 |   | 383 |   | 323 |
| Other                                                                                                                                  | 272                                              |                                             | 213                                 |   | 809 |   | 765 |
| Total      noninterest expense                                                                                                         | 6,174                                            |                                             | 5,827                               |   | 18,481 |   | 18,192 |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Income      before income taxes                                                                                                        | 1,821                                            |                                             | 2,500                               |   | 4,790 |   | 6,593 |
| Income      tax expense                                                                                                                | 702                                              |                                             | 934                                 |   | 1,779 |   | 2,517 |
| NET      INCOME                                                                                                                        | $      1,119                                     |                                             | $      1,566                        |   | $      3,011 |   | $      4,076 |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Earnings      per share:                                                                                                               |                                             |                                             |                                |   |   |   |   |
| Basic                                                                                                                                  | $  0.07                                |                                             | $  0.09(1)                |   | $  0.19(1) |   | $  0.25(1) |
| Diluted                                                                                                                                | 0.07                                             |                                             |   0.09(1)                 |   | 0.19(1) |   | 0.24(1) |
| Weighted      average number of shares outstanding:                                                                                    |                                             |                                             |                                |   |   |   |   |
| Basic                                                                                                                                  | 16,007,599                                       |                                             | 16,615,053(1)                       |   | 16,237,911(1) |   | 16,579,847(1) |
| Diluted                                                                                                                                | 16,043,435                                       |                                             | 16,716,164(1)                       |   | 16,255,548(1) |   | 16,717,563(1) |
|                                                                                                                                   |                                             |                                             |                                |   |   |   |   |
| Dividends      declared per share:                                                                                                     |        $0.055 |                                             | $0.048(1)                           |   |     $0.158(1) |   | $0.145(1) |

----

|                                                                                                                                                                      |  Common      Stock                          | Additional      Paid-In Capital        | RetainedEarnings    | Unearned      SharesIssued      toEmployeeStockOwnershipPlan | AccumulatedOtherComprehensiveLoss | Total                            |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------|----------------------------------------|---------------------|--------------------------------------------------------------|-----------------------------------|----------------------------------|
| Shares                                                                                                                                                                    | Amount                                           |
| Balance      at Sept. 30, 2006                                                                                                                                            | 15,169,114                        | $152          | $      57,222  | $      54,805                                           | $      (4,134)          | $  (176)     | $107,869  |
|                                                                                                                                                                      |                                             |                                   |                |                                                         |                              |                             |   |
| Restricted      stock issued, net of forfeitures                                                                                                                          | (6,924 )       )                       |                                   |                |                                                         |                              |                             | --  |
| ESOP      shares committed to be released                                                                                                                                 |                                             |                                   | 357            |                                                    | 436                |                             | 793  |
| Exercise      of stock options                                                                                                                                            | 70,053        |                                   | 854            |                                                         |                              |                             | 854  |
| Share-based      compensation                                                                                                                                             |                                             |                                   | 1,036               |                                                         |                              |                             |       1,036    |
| Excess      tax benefits from equity compensation plans                                                                                                                   |                                             |                                   | 144            |                                                         |                              |                             |          144    |
| Dividends      paid       ($0.190      per share)  (1) (2)                                                              |                                             |                                   |                | (1,281)                                                      |                              |                             |   (1,281)   |
| Comprehensive      income:                                                                                                                                                |                                             |                                   |                |                                                         |                              |                             |   |
| Net      income                                                                                                                                                           |                                             |                                   |                | 5,271                                                   |                              |                             | 5,271  |
| Other      comprehensive income:                                                                                                                                          |                                             |                                   |                |                                                         |                              |                             |   |
|          Change in unrealized  holding loss on securities available for sale,      net of  taxes                                            |                                             |                                   |                |                                                         |                              | (100)                  | (100) |
|          Change in unrealized  holding loss resulting from transfer of      securities from held to maturity to available for sale, net of      taxes |                                             |                                   |                |                                                         |                              | (1,949)                |  (1,949) |
| Comprehensive      income:                                                                                                                                                |                                             |                                   |                |                                                         |                              |                             | 3,222  |
| Balance      at Sept. 30, 2007                                                                                                                                            | 15,232,243  3                          | 152           | 59,613         | 58,795                                                  | (3,698)                 | (2,225)                | 112,637  |
|                                                                                                                                                                      |                                             |                                   |                |                                                         |                              |                             |   |
| Second      Step Conversion(3)                                                                                                                                            | 2,073,619                    |  21      |  96,425   |                                                         | (8,160)                 |                             | 88,286  |
| Dissolution      of  Mutual Holding Company                                                                                                                     |                                             |                                   | 50             |                                                         |                              |                             | 50  |
| Restricted      stock issued, net of forfeitures                                                                                                                          | 13,502                                 |                    |                |                                                         |                              |                             | -  |
| ESOP      shares committed to be released                                                                                                                                 |                                             |                                   | (106)               |                                                         | 529                |                             | 423  |
| Exercise      of stock options                                                                                                                                            | 28,865                       |                    | 328            |                                                         |                              |                             | 328  |
| Share-based      compensation                                                                                                                                             |                                             |                                   | 779            |                                                         |                              |                             | 779  |
| Dividends      paid       ($0.158)      per share)  (1) (2)                                                             |                                             |                                   |                | (2,099)                                                      |                              |                             |   (2,099)   |
| Comprehensive      income:                                                                                                                                                |                                             |                                   |                |                                                         |                              |                             |   |
| Net      income                                                                                                                                                           |                                             |                                   |                | 3,011                                                   |                              |                             |     3,011 |
| Other      comprehensive income:                                                                                                                                          |                                             |                                   |                |                                                         |                              |                             |   |
|          Change in unrealized holding loss on securities available for sale, net      of  taxes                                                  |                                             |                                   |                |                                                         |                              | 117               | 117  |
|          Comprehensive income:                                                                                                                             |                                             |                                   |                |                                                         |                              |                             |  3,128  |
| Balance      at June 30, 2008                                                                                                                                             | 17,348,229                   | $173               | $157,089       | $      59,707                                           | $(11,329)               |  $      (2,108)   | $203,532  |

----

----

| HOME      FEDERAL BANCORP, INC. AND SUBSIDIARYCONSOLIDATED      STATEMENTS OF CASH FLOWS(In      thousands) (Unaudited) | Nine      Months Ended June      30, |
|-------------------------------------------------------------------------------------------------------------------------|-------------------------------------------|
|                                                                                                                    | 2008                                      |   | 2007 |
|  CASH      FLOWS FROM OPERATING ACTIVITIES:                                                                        |                                      |   |   |
| Net      income                                                                                                         | $  3,011                        |   | $    4,076 |
| Adjustments      to reconcile net income to cash provided by operating      activities:                                 |                                      |   |   |
| Depreciation      and amortization                                                                                      | 1,247                                     |   | 1,294 |
| Net      accretion of premiums and discounts on investments                                                             | (18)                                      |   | (49) |
| Loss      (Gain) on sale of fixed assets and repossessed assets                                                         | 119                                       |   | (3) |
| Gain      on sale of mortgage-backed securities                                                                         | -                                         |   | (4) |
| ESOP      shares committed to be released                                                                               | 423                                       |   | 618 |
| Equity      compensation expense                                                                                        | 779                                       |   | 783 |
| Provision      for loan losses                                                                                          | 1,317                                     |   | 71 |
| Accrued      deferred compensation expense, net                                                                         | 513                                       |   | 543 |
| Net      deferred loan fees                                                                                             | 54                                        |   | 139 |
| Deferred      income tax benefit                                                                                        | (598)                                     |   | (357) |
| Net      gain on sale of loans                                                                                          | (560)                                     |   | (1,168) |
| Proceeds      from sale of loans held for sale                                                                          | 38,579                                    |   | 78,989 |
| Originations      of loans held for sale                                                                                | (37,193)                                  |   | (78,303) |
| Net      decrease in value of mortgage servicing rights                                                                 | 207                                       |   | 223 |
| Net      increase in value of bank owned life insurance                                                                 | (314)                                     |   | (301) |
| Change      in assets and liabilities:                                                                                  |                                      |   |   |
| Interest      receivable                                                                                                | 5                                         |   | 145 |
| Other      assets                                                                                                       | 158                                       |   | (837) |
| Interest      payable                                                                                                   | (151)                                     |   | (198) |
| Other      liabilities                                                                                                  | (903)                                     |   | (553) |
| Net      cash provided by operating activities                                                                          | 6,675                                     |   | 5,108 |
|  CASH      FLOWS FROM INVESTING ACTIVITIES:                                                                        |                                      |   |   |
| Proceeds      from maturity of mortgage-backed securities held to    maturity                                           | -                                         |   | 13,094 |
| Proceeds      from maturity of mortgage-backed securities available for    sale                                         | 23,976                                    |   | 12,264 |
| Purchases      of mortgage-backed securities available for sale                                                         | (56,257)                                  |   | (2,102) |
| Investment      in certificate of deposit                                                                               | (5,000)                                   |   |   |
| Purchases      of property and equipment                                                                                | (3,218)                                   |   | (672) |
| Net      decrease in loans                                                                                              | 9,720                                     |   | 11,337 |
| Proceeds      from sale of fixed assets and repossessed assets                                                          | 501                                       |   | 9 |
| Net      cash (used) provided by investing activities                                                                   | (30,278)                                  |   | 33,930 |
|                                                                                                                    |                                      |   |   |
| CASH      FLOWS FROM FINANCING ACTIVITIES:                                                                              |                                      |   |   |
| Net      decrease in deposits                                                                                           | (22,267)                                  |   | (11,583) |
| Net      decrease in advances by borrowers for taxes and insurance                                                      | (948)                                     |   | (1,212) |
| Proceeds      from FHLB advances                                                                                        | 59,715                                    |   | 143,835 |
| Repayment      of FHLB advances                                                                                         | (94,863)                                  |   | (165,330) |
| Net      proceeds from stock issuance and exchange pursuant to second step      conversion                              | 88,336                                    |   | - |
| Proceeds      from exercise of stock options                                                                            | 328                                       |   | 854 |
| Excess      tax benefit from equity compensation plans                                                                  | -                                         |   | 58 |
| Dividends      paid                                                                                                     | (2,099)                                   |   | (959) |
| Net      cash provided (used) by financing activities                                                                   | 28,202                                    |   | (34,337) |
|  NET      INCREASE IN CASH AND CASH EQUIVALENTS                                                                    | 4,599                                     |   | 4,701 |
| CASH      AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                                     | 20,588                                    |   | 18,385 |
| CASH      AND CASH EQUIVALENTS, END OF PERIOD                                                                           |     $      25,187     |   |     $  23,086 |

----

| HOME      FEDERAL BANCORP, INC. AND SUBSIDIARYCONSOLIDATED      STATEMENTS OF CASH FLOWS (Continued)(In      thousands) (Unaudited)                                                                                                                                   | Nine      Months EndedJune      30,                                                       |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                  | 2008                                                                                      |   | 2007 |
|  SUPPLEMENTAL      DISCLOSURE OF CASH FLOW INFORMATION:                                                                                                                                                                                                          |                                                                                      |   |   |
| Cash      paid during the period for:                                                                                                                                                                                                                                 |                                                                                      |   |   |
| Interest                                                                                                                                                                                                                                                              |      $14,259                                                |   |      $      16,286 |
|                  Income taxes                                                                                                                                                                                  |                    2,610 |   |               2,825 |
|                                                                                                                                                                                                                                                                  |                                                                                      |   |   |
| NONCASH      INVESTING AND FINANCING ACTIVITIES:                                                                                                                                                                                                                      |                                                                                      |   |   |
| Acquisition      of real estate and other assets in settlement of loans                                                                                                                                                                                               |      1,137                                                  |   |   153 |
| Fair      value adjustment to securities available for sale, net of      taxes                                                                                                                                                                                        | 117                                                                                  |   | (3,301) |
| Transfer      of securities from held to maturity to available for sale                                                                                                                                                                                               | -                                                                                    |   | 171,688 |
|           Fair value adjustment to securities available for sale, net of taxes as      a           result      of transferring securities from held to maturity to available for      sale | -                                                                                    |   | (1,949) |
|                                                                                                                                                                                                                                                                  |                                                                                      |   |   |

----

----

----

|                                                                                                                               | Three      Months Ended June      30,           |   | Nine      Months Ended June      30, |
|------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------|--------|-------------------------------------------|
|                                                                                                                               | 2008                                                 |   | 2007                                      |   | 2008 |   | 2007 |
|                                                                                                                               | (in      thousands, except share and per share data) |
| Basic      EPS:                                                                                                                    |                                                 |   |                                      |   |   |   |   |
| Net      income                                                                                                                    | $1,119                                               |   | $1,566                                    |   | $3,011 |   | $4,076 |
| Weighted-average      common shares outstanding                                                                                    | 16,007,599                                           |   | 16,615,053                                |   | 16,237,911 |   | 16,579,847 |
| Basic      EPS                                                                                                                     | $  0.07                                    |   | $  0.09                         |   | $      0.19 |   | $  0.25 |
|                                                                                                                               |                                                 |   |                                      |   |   |   |   |
| Diluted      EPS:                                                                                                                  |                                                 |   |                                      |   |   |   |   |
| Net      income                                                                                                                    | $1,119                                               |   | $1,566                                    |   | $3,011 |   | $4,076 |
| Weighted-average      common shares outstanding                                                                                    | 16,007,599                                           |   | 16,615,053                                |   | 16,237,911 |   | 16,579,847 |
| Net      effect of dilutive SOP awards                                                                                             | 2,986                                                |   | 52,908                                    |   | - |   | 85,367 |
| Net      effect of dilutive RRP awards                                                                                             | 32,850                                               |   | 48,203                                    |   | 17,637 |   | 52,349 |
|         Weighted-average common shares    outstanding      and common stock    equivalents | 16,043,435                                           |   | 16,716,164                                |   | 16,255,548 |   | 16,717,563 |
| Diluted      EPS                                                                                                                   | $      0.07                                          |   | $      0.09                               |   | $      0.19 |   | $      0.24 |
|                                                                                                                               |                                                 |   |                                      |   |   |   |   |

|                                                 | June      30, 2008               |
|------------------------------------------------------|----------------------------------|
|                                                 | Amortized      Cost              |   | Gross Unrealized      Gains |   | Gross      Unrealized      Losses |   | Fair Value |
|                                                 | (in      thousands)              |
|                                                 |                             |   |   |   |   |   |   |
| Issued      by U.S. Government sponsored enterprises | $194,861          |   | $588    |   | $(3,997)    |   | $191,452    |
| Other                                                | 3,405             |          |                                      --  - |             | (104)    |   | 3,301    |
| Total                                                | $198,266          |   | $588    |   | $(4,101)    |   | $194,753    |
|                                                 |                             |   |   |   |   |   |   |
|                                                 | September 30,      2007     |
|                                                 |                             |   |   |   |   |   |   |
| Issued      by U.S. Government sponsored enterprises | $162,503     |   | $191     |   | $(3,823)    |   | $158,871     |
| Other                                                | 3,464        |   |  --         - |   | (77)    |   | 3,387     |
|       Total            | $165,967     |   | $191     |   | $(3,900)    |   | $162,258     |

|                       | Less      than 12 months |   | 12      months or longer |   | Total           |
|----------------------------|--------------------------|--------|--------------------------|--------|-----------------|
|                       | FairValue                |   | UnrealizedLosses         |   | Fair      Value |   | UnrealizedLosses |   | Fair      Value |   | UnrealizedLosses |
|                       | (in      thousands)      |
| Mortgage-backed            |                     |   |                     |   |            |   |   |   |   |   |   |
| securities,      available |                     |   |                     |   |            |   |   |   |   |   |   |
| for      sale              | $129,250                 |   | $(3,199)                 |   | $18,036         |   | $(902) |   | $147,286 |   | $(4,101) |

----

|                                  | June      30, 2008          |               | September      30, 2007         |
|---------------------------------------|-----------------------------|--------------------|---------------------------------|
|                                  | Balance                     |               | Percent      of      Total      |   | Balance |   | Percent of      Total |
|                                  | (dollars      in thousands) |
| Real      Estate:                     |                        |               |                            |   |   |   |   |
| One-      to four-family residential  | $217,517               |               | 45.98%      |   | $249,545  |   | 51.55% |
| Multi-family      residential         | 8,514                  |               | 1.80             |   | 6,864  |   | 1.42    |
| Commercial                            | 152,071                |          | 32.14                 |   | 133,823  |   | 27.64    |
| Total      real estate                | 378,102                |               | 79.92            |   | 390,232  |   | 80.61    |
|                                  |                        |               |                            |   |   |   |   |
| Real      Estate Construction:        |                        |               |                            |   |   |   |   |
| One-      to four-family residential  | 16,794                 |               | 3.55             |   | 20,545  |   | 4.24    |
| Multi-family      residential         | 920                    |               | 0.19             |          | 1,770  |   | 0.36   |
| Commercial                            | 4,958                  |               | 1.05             |   | 13,691  |   | 2.83    |
| Acquisition      and land development | 12,270                 |               | 2.59             |   | 8,208  |   | 1.69    |
| Total      real estate construction   | 34,942                 |               | 7.38             |          | 44,214  |   | 9.12    |
|                                  |                        |               |                            |   |   |   |   |
| Consumer:                             |                        |               |                            |   |   |   |   |
| Home      equity                      | 51,912                 |               | 10.97            |   | 42,990  |   | 8.88    |
| Automobile                            | 2,063                  |          | 0.44             |   | 2,173  |   | 0.45    |
| Other      consumer                   | 1,396                  |               | 0.30                  |   | 1,405  |   | 0.29    |
| Total      consumer                   | 55,371                 |               | 11.71            |   | 46,568  |   | 9.62    |
|                                  |                        |               |                            |   |   |   |   |
| Commercial      business              | 4,705                  |               | 0.99                  |   | 3,122  |   | 0.65    |
|                                  | 473,120                |               | 100.00%     |   | 484,136  |   | 100.00%  |
| Less:                                 |                        |               |                            |   |   |   |   |
| Deferred      loan fees               | (976)                       |               |                            |   | (1,030) |   |   |
| Allowance      for loan losses        | (3,801)                     |               |                            |   | (2,988) |   |   |
| Loans      receivable, net            | $468,343               |               |                            |   | $480,118  |   |   |

----

|                                                         |   | Three      Months Ended June      30,                                              |               | Nine      Months EndedJune      30,                       |
|--------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------|--------------------|-----------------------------------------------------------|
| Servicing      Right Classes                                 |   | 2008                                                                                    |               | 2007                                                      |   | 2008 |   | 2007 |
|                                                         |   | (in      thousands)                                                                     |
| One-      to four-family residential loans:                  |   |                                                                                    |               |                                                      |   |   |   |   |
| Beginning      Balance                                       |   | $1,894                                                         |               | $2,298                           |   | $2,033      |   | $2,468      |
| Additions      for new mortgage servicing rights capitalized |   |           --         - |          | 42                               |   |               --         - |          | 45      |
| Adjustments      to fair value                               |   | (61)        )                                                                 |               | (87)                                  |   | (200)     |   | (260)     |
| Ending      Balance                                          |   | $1,833                                                         |               | $2,253                           |   | $1,833      |   | $2,253      |
|                                                         |   |                                                                                    |               |                                                      |   |   |   |   |
| Commercial      real estate loans:                           |   |                                                                                    |               |                                                      |   |   |   |   |
| Beginning      Balance                                       |   | $      9                         |               | $          19     |          | $    14      |          | $     24      |
| Adjustments      to fair value                               |   | (2)                                                                 |               | (3)                                   |   | (7)     |   | (8)     |
| Ending      Balance                                          |   | $           7                         |               | $    16      |   | $           7      |          | $     16      |
|                      |   |                                                                                    |               |                                                      |   |   |   |   |

| ·   | statements      of our goals, intentions andexpectations; |
|--------------------|-----------------------------------------------------------|

| ·   | statements      regarding our business plan, prospects, growth and operating      strategies; |
|--------------------|-----------------------------------------------------------------------------------------------|

| ·   | statements      regarding the quality of our loan and investment portfolios;      and |
|--------------------|---------------------------------------------------------------------------------------|

| ·   | estimates      of our risks and future costs andbenefits. |
|--------------------|-----------------------------------------------------------|

----

| ·   | general      economic conditions, including real estate values, either nationally or in      the Company’s market area, that are worse than  expected; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | changes      in the interest rate environment that reduce the Company’s interest      margins or reduce the fair value of financial  instruments; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the      credit risk of lending activities, including risks related to construction      and development lending and commercial and small business      banking; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | changes      in the level and trend of loan delinquencies and    write-offs; |
|--------------------|------------------------------------------------------------------------------|

| ·   | results      of examinations by bankingregulators; |
|--------------------|----------------------------------------------------|

| ·   | increased      competitive pressures among financial services  companies; |
|--------------------|---------------------------------------------------------------------------|

| ·   | changes      in consumer spending, borrowing and savings  habits; |
|--------------------|-------------------------------------------------------------------|

| ·   | changes      in the value of mortgage servicingrights; |
|--------------------|--------------------------------------------------------|

| ·   | legislative      or regulatory changes that adversely affect the Company’s      business; |
|--------------------|-------------------------------------------------------------------------------------------------|

| ·   | adverse      changes in the securities markets;and |
|--------------------|----------------------------------------------------|

| ·   | changes      in accounting policies and practices, as may be adopted by the bank      regulatory agencies, the Public Company Accounting Oversight Board or the      Financial Accounting StandardsBoard. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| §   | Net      income fell to $1.1 million, or $0.07 per diluted share, compared to $1.6      million, or $0.09 per diluted share, for the same period a year      ago; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | Revenues      increased 5% compared to the third quarter of 2007 as the net interest      margin increased 27 basis points to 3.29% from  3.02%; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | Nonperforming      assets increased to 0.56% of assets at June 30, 2008, compared to 0.07% at      June 30, 2007; |
|--------------------|-------------------------------------------------------------------------------------------------------------------|

| §   | Net      loans receivable declined $8.8 million as the Bank’s loan portfolios      secured by one- to- four family residences continue to decline, falling      $11.5 million during the quarter; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | Deposits      decreased $13.8 million during the third quarter as high interest rates      offered by competitors drew certificates of deposit from the      Bank; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | The      efficiency ratio increased compared to the third quarter of fiscal 2007 as      increases in expenses outweighed higher revenues in  2008; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | In      order to improve credit risk management, the credit administration and      workout teams were realigned to report directly to the President and Chief      Executive Officer and a Chief Credit Officer was  appointed; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | Additional      steps were taken to build strong commercial and small business lending      programs by acquiring key management personnel to lead the development of      those programs; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | In      order to become more efficient, lower costs and improve customer service      in the bank’s consumer line of business, the residential and consumer      lending teams were reorganized; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| §   | Construction      began on a new banking office in Boise, Idaho, which is expected to open      in October 2008; and, |
|--------------------|-----------------------------------------------------------------------------------------------------------------------|

| §   | The      Bank maintained its very strong capital position with a risk-based capital      ratio of 32.3% at June 30, 2008. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------|

----

----

|                                                    |                                                            |   | Increase      (decrease)                |
|---------------------------------------------------------|-----------------------------------------------------------------|--------|-----------------------------------------|
|                                                    |                                                            |   |                                    |   |   |   |   |
|                                                    | Balance      at June      30, 2008                         |   | Balance      at September      30, 2007 |   | Amount |   | Percent |
|                                                    |       (dollars      in thousands) |
|                                                    |                                                            |   |                                    |   |   |   |   |
| Cash      and amounts due from depository institutions  | $      25,187                                                   |   | $      20,588                           |   | $  4,599  |   | 22.3% |
| Mortgage-backed      securities, available for sale     | 194,753                                                         |   | 162,258                                 |   | 32,495  |   | 20.0    |
| Loans      receivable, net of allowance for loan losses | 468,343                                                         |   | 480,118                                 |   | (11,775) |   | (2.5)   |

----

|                                     |                                                            |   | Increase      (decrease)                |
|------------------------------------------|-----------------------------------------------------------------|--------|-----------------------------------------|
|                                     |                                                            |   |                                    |   |   |   |   |
|                                     | Balance      atJune      30,2008                                |   | Balance      at September      30, 2007 |   | Amount |   | Percent |
|                                     |       (dollars      in thousands) |
|                                     |                                                            |   |                                    |   |   |   |   |
| Noninterest-bearing      demand deposits | $  35,258                                             |   | $  38,643                     |   | $  (3,385)     |   | (8.8)%     |
| Interest-bearing      demand deposits    | 140,401                                                         |   | 127,659                                 |   | 12,742      |   | 10.0      |
| Savings      deposits                    | 26,409                                                          |   | 23,116                                  |   | 3,293      |   | 14.3         |
| Certificates      of deposit             | 180,274                                                         |   | 215,191                                 |   | (34,917)     |   | (16.2)         |
| Total      deposit accounts              | $382,342                                                        |   | $404,609                                |   | $(22,267)     |   | (5.5)% |

----

|                                                                              | Three      Months Ended June 30, 2008Compared      to Three Months EndedJune  30,      2007 |
|-----------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------|
|                                                                              | Increase      (Decrease) Due to                                                                       |   |   |
|                                                                              |                                                                                                  |   |   |   |   |
|                                                                              | Rate                                                                                                  |   | Volume |   | Total |
|                                                                              | (in      thousands)                                                                                   |
| Interest-earning      assets:                                                     |                                                                                                  |   |   |   |   |
| Loans      receivable, net                                                        | $(439)                                                                                                |   | $(328) |   | $        (767) |
| Loans      held for sale                                                          | (3)                                                                                                   |   | (20) |   | (23) |
| Investment      securities, including interest-bearing deposits in other    banks | (148)                                                                                                 |   | 86  |   | (62) |
| Mortgage-backed      securities                                                   | (71)                                                                                                  |   | 320  |   | 249  |
| FHLB      stock                                                                   | 46                                                                                               |   | -  |   | 46  |
| Total      net change in income on interest-earning assets                        | $(615)                                                                                                |   | $        58  |   | $   (557) |
|                                                                              |                                                                                                  |   |   |   |   |
| Interest-bearing      liabilities:                                                |                                                                                                  |   |   |   |   |
| Savings      deposits                                                             | $         15                                                                      |   | $          2  |   | $            17  |
| Interest-bearing      demand deposits                                             | (15)                                                                                                  |   | (17) |   | (32) |
| Money      market accounts                                                        | (159)                                                                                                 |   | 128  |   | (31) |
| Certificates      of deposit                                                      | (178)                                                                                                 |   | (478) |   | (656) |
| Total      deposits                                                               | (337)                                                                                                 |   | (365) |   | (702) |
| FHLB      advances                                                                | 55                                                                                               |   | (510) |   | (455) |
| Total      net change in expense on interest-bearing liabilities                  | $(282)                                                                                                |   | $(875) |   | $(1,157) |
|  Total      increase in net interest income                                  |                                                                                                  |   |   |   | $          600  |
|                                                                              |                                                                                                  |   |   |   |   |

----

|                                                                                                    | Three      Months Ended June 30, |
|---------------------------------------------------------------------------------------------------------|----------------------------------|
|                                                                                                    | 2008                             |   | 2007 |   | Increase/ |
|                                                                                                    | Average      Balance             |   | Yield |   | Average      Balance |   | Yield |   | (Decrease)      in Interest      and Dividend      Income      from 2007 |
|                                                                                                    | (dollars      in thousands)      |
|                                                                                                    |                             |   |   |   |   |   |   |   |   |
| Loans      receivable, net                                                                              | $478,806                         |   | 6.26% |   | $499,101 |   | 6.62% |   | $(767) |
| Loans      held for sale                                                                                | 3,208                            |   | 6.06   |   | 4,546 |   | 6.33        |   | (23) |
| Investment      securities, available for sale, including interest-bearing deposits in      other banks | 23,698                           |   | 1.97    |   | 13,757 |   | 5.20    |   | (62) |
| Mortgage-backed      securities                                                                         | 202,904                          |   | 4.68    |            | 175,718 |   | 4.83    |   | 249  |
| FHLB      stock                                                                                         | 9,591                            |   | 2.50    |   | 9,591 |   | 0.58    |   | 46  |
| Total      interest-earning assets                                                                      | $718,207                         |   | 5.62% |   | $702,713 |   | 6.06% |   | $(557) |

|                                                         | Three      Months Ended June 30, |
|--------------------------------------------------------------|----------------------------------|
|                                                         | 2008                             |   | 2007 |   | Increase/ |
|                                                         | Average      Balance             |   | Cost |   | Average      Balance |   | Cost |   | (Decrease)      in Interest      Expense      from 2007 |
|                                                         | (dollars      in thousands)      |
|                                                         |                             |   |   |   |   |   |   |   |   |
| Savings      deposits                                        | $  25,337              |   | 0.74% |   | $  23,567 |   | 0.51% |   |  $     17  |
| Interest-bearing      demand    deposits | 80,634                           |   | 0.54        |   | 92,534 |   | 0.61         |   | (32) |
| Money      market deposits                                   | 61,902                           |   | 1.90    |   | 41,063 |   | 3.17         |   | (31) |
| Certificates      of deposit                                 | 183,791                          |   | 4.31    |   | 227,237 |   | 4.64    |   | (656) |
| FHLB      advances                                           | 153,016                          |   | 4.58   |   | 197,619 |   | 4.47   |   | (455) |
| Total      interest-bearing liabilities                      | $504,680                         |   | 3.31% |   | $582,020 |   | 3.67% |   | $(1,157) |

----

|                                                                                                                       | At      or For the Three Months Ended      June 30,                                                             |
|----------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------|
|                                                                                                                       | 2008                                                                                                                 |   | 2007 |
|                                                                                                                       | (dollars      in thousands)                                                                                          |
|                                                                                                                       |                                                                                                                 |   |   |
| Provision      for loan losses                                                                                             | $       652                                                   |   | $            -      |
| Net      charge-offs                                                                                                       | 158                                                                                              |   | 100     |
| Allowance      for loan losses                                                                                             | 3,801                                                                                            |   | 2,748     |
| Allowance      for loan losses as a percentage of gross loans receivable at the end of      the period                     | 0.81%                                                                                                 |   |  0.56%    |
| Nonperforming      loans                                                                                                   | $    3,462                                                                   |    | $       367     |
| Allowance      for loan losses as a percentage of nonperforming loans at the end of the      period                        | 109.79%                                                                                               |   | 748.77%    |
| Nonaccrual      and 90 days or more past due loans as a percentage of loans receivable,      net, at the end of the period |              0.73         3     |          | 0.07             |
| Loans      receivable, net                                                                                                 | $468,343                                                                                              |   | $491,768           |

|                                                               | Three      Months EndedJune      30,                            |                           | Increase      (decrease) |
|--------------------------------------------------------------------|-----------------------------------------------------------------|--------------------------------|--------------------------|
|                                                               | 2008                                                            |                           | 2007                     |   | Amount |   | Percent |
|                                                               |       (dollars      in thousands) |
|                                                               |                                                            |                           |                     |   |   |   |   |
| Service      fees and charges                                      | $2,396                                                |                           | $2,318         |   |   $   78        |          | 3.4%          |
| Gain      on sale of loans                                         | 213                                                   |                           | 491            |   | (278)        ) |   | (56.6)          |
| Increase      in cash surrender value of bank owned life insurance | 106                                                   |                           | 102            |   | 4       |   | 3.9      |
| Loan      servicing fees                                           | 116                                                   |                           | 134            |   | (18)     |   | (13.4)          |
| Mortgage      servicing rights, net                                | (63)                                                       |                           | (48)                |   | (15)     |   | 31.3           |
| Other                                                              | (33)                                                       |            | 18             |   | (51)     |   | 283.3           |
| Total      noninterest income                                      | $2,735                                                |                           | $3,015         |   | $(280)     |   | (9.3)%    |

----

|                                 | Three      Months EndedJune      30,                            |   | Increase      (decrease) |
|--------------------------------------|-----------------------------------------------------------------|--------|--------------------------|
|                                 | 2008                                                            |   | 2007                     |   | Amount |   | Percent |
|                                 |       (dollars      in thousands) |
|                                 |                                                            |   |                     |   |   |   |   |
| Compensation      and benefits       | $3,840                                                          |   | $3,498                   |   | $      342      |   | 9.8%    |
| Occupancy      and equipment         | 771                                                             |   | 716                      |   | 55      |          | 7.7          |
| Data      processing                 | 615                                                             |   | 548                      |   | 67      |   | 12.2    |
| Advertising                          | 241                                                             |   | 362                      |   | (121)     |   | (33.4)        |
| Other                                | 707                                                             |   | 703                      |   | 4      |          | 0.1         |
|  Total      noninterest expense | $6,174                                                          |   | $5,827                   |   | $      347      |   | 6.0%    |

----

|                                                                              | Nine      Months Ended June 30, 2008Compared      to Nine Months EndedJune      30, 2007 |
|-----------------------------------------------------------------------------------|------------------------------------------------------------------------------------------|
|                                                                              | Increase      (Decrease) Due to                                                          |   |   |
|                                                                              | Rate                                                                                     |   | Volume |   | Total |
|                                                                              | (in      thousands)                                                                      |
| Interest-earning      assets:                                                     |                                                                                     |   |   |   |   |
| Loans      receivable, net                                                        | $(509)                                                                                   |   | $(1,379) |   | $(1,888) |
| Loans      held for sale                                                          | (8)                                                                                      |   | (45) |   | (53) |
| Investment      securities, including interest-bearing deposits in other    banks | (154)                                                                                    |   | 822  |   | 668  |
| Mortgage-backed      securities                                                   | (81)                                                                                     |   | (129) |   | (210) |
| FHLB      stock                                                                   | 77                                                                                  |   | -  |   | 77  |
| Total      net change in income on interest-earning assets                        | $(675)                                                                                   |   | $   (731) |   | $(1,406) |
|                                                                              |                                                                                     |   |   |   |   |
| Interest-bearing      liabilities:                                                |                                                                                     |   |   |   |   |
| Savings      deposits                                                             | $   56                                                               |   | $              -  |   | $      56  |
| Interest-bearing      demand deposits                                             | 42                                                                                  |   | (81) |   | (39) |
| Money      market accounts                                                        | (84)                                                                                     |   | 436  |   | 352  |
| Certificates      of deposit                                                      | 109                                                                                 |   | (1,109) |   | (1,000) |
| Total      deposits                                                               | 123                                                                                 |   | (754) |   | (631) |
| FHLB      advances                                                                | 317                                                                                 |   | (1,665) |   | (1,348) |
|                                                                              |                                                                                     |   |   |   |   |
| Total      net change in expense on interest-bearing liabilities                  | $ 440                                                                          |   | $(2,419) |   | $(1,979) |
|                                                                              |                                                                                     |   |   |   |   |
|  Total      increase in net interest income                                  |                                                                                     |   |   |   | $    573  |

|                                                                                                    | Nine      Months Ended June 30, |
|---------------------------------------------------------------------------------------------------------|---------------------------------|
|                                                                                                    | 2008                            |   | 2007 |   | Increase/ |
|                                                                                                    | Average      Balance            |   | Yield |   | Average      Balance |   | Yield |   | (Decrease)      in Interest      and Dividend      Income      from 2007 |
|                                                                                                    | (dollars      in thousands)     |
|                                                                                                    |                            |   |   |   |   |   |   |   |   |
| Loans      receivable, net                                                                              | $480,477                        |   | 6.46% |   | $508,782 |   | 6.59% |   | $(1,888) |
| Loans      held for sale                                                                                | 2,716                           |   | 6.22   |   | 3,675 |   | 6.54   |   | (53) |
| Investment      securities, available for sale, including interest-bearing deposits in      other banks | 35,301                          |   | 3.37    |   | 5,713 |   | 5.20    |   | 668  |
| Mortgage-backed      securities                                                                         | 182,080                         |   | 4.73    |   | 185,694 |   | 4.79    |   | (210) |
| FHLB      stock                                                                                         | 9,591                           |   | 1.53    |   | 9,591 |   | 0.46    |   | 77   |
| Total      interest-earning assets                                                                      | $710,165                        |   | 5.79% |   | $713,455 |   | 6.03% |   | $(1,406) |
|                                                                                                    |                            |   |   |   |   |   |   |   |   |

----

|                                                         | Nine      Months Ended June 30, |
|--------------------------------------------------------------|---------------------------------|
|                                                         | 2008                            |   | 2007 |   |   |
|                                                         | Average      Balance            |   | Cost |   | Average      Balance |   | Cost |   | Increase/      (Decrease)      in Interest      Expense |
|                                                         | (dollars      in thousands)     |
|                                                         |                            |   |   |   |   |   |   |   |   |
| Savings      deposits                                        | $  23,570             |   | 0.70% |   | $  23,457 |   | 0.39% |   |  $       56  |
| Interest-bearing      demand    deposits | 79,065                          |   | 0.64   |   | 93,330 |   | 0.60        |   | (39) |
| Money      market deposits                                   | 57,793                          |   | 2.69    |   | 37,852 |   | 2.87         |   | 352  |
| Certificates      of deposit                                 | 199,179                         |   | 4.58    |   | 230,242 |   | 4.54         |   | (1,000) |
| FHLB      advances                                           | 162,471                         |   | 4.59   |   | 207,517 |   | 4.46   |   | (1,348) |
| Total      interest-bearing liabilities                      | $522,078                        |   | 3.60% |   | $592,398 |   | 3.62% |   | $(1,979) |

|                                                               | Nine      Months EndedJune      30,                             |               | Increase      (decrease) |
|--------------------------------------------------------------------|-----------------------------------------------------------------|--------------------|--------------------------|
|                                                               | 2008                                                            |               | 2007                     |   | Amount |   | Percent |
|                                                               |       (dollars      in thousands) |
|                                                               |                                                            |               |                     |   |   |   |   |
| Service      fees and charges                                      | $6,731                                                     |               | $6,979              |   |   $(248) |   | (3.6)%    |
| Gain      on sale of loans                                         | 560                                                        |               | 1,168               |   | (608)     |   | (52.1)     |
| Increase      in cash surrender value of bank owned life insurance | 314                                                        |          | 301                 |   | 13      |   | 4.3      |
| Loan      servicing fees                                           | 369                                                        |               | 420                 |          | (51)     |   | (12.1)    |
| Mortgage      servicing rights, net                                | (206)                                                           |               | (223)                    |   | 17      |   | 7.6      |
| Other                                                              | 75                                                         |               | 39                  |   | 36      |   | 92.3           |
| Total      noninterest income                                      | $7,843                                                          |               | $8,684              |   | $(841)     |   | (9.7)%    |

----

|                                 | Nine      Months EndedJune      30,                             |   | Increase      (decrease) |
|--------------------------------------|-----------------------------------------------------------------|--------|--------------------------|
|                                 | 2008                                                            |   | 2007                     |   | Amount |   | Percent |
|                                 |       (dollars      in thousands) |
|                                 |                                                            |   |                     |   |   |   |   |
| Compensation      and benefits       | $11,592                                                         |   | $11,363                  |   | $      229      |   | 2.0%    |
| Occupancy      and equipment         | 2,242                                                           |   | 2,145                    |   | 97      |   | 4.5     |
| Data      processing                 | 1,668                                                           |   | 1,549                    |   | 119      |   | 7.7    |
| Advertising                          | 786                                                             |   | 940                      |   | (154)     |   | (16.4)   |
| Other                                | 2,193                                                           |   | 2,195                    |   | (2)     |   | (0.1)   |
|  Total      noninterest expense | $18,481                                                         |   | $18,192                  |   | $      289      |   | 1.6%    |

----

|                         | Payments      due by period                                                                                                                |
|------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------|
|                         | Less      than one year                                                                                                                    |  1 –      3 years |  3 –      5 years | More      than 5 years |  Total |
|                         | (dollars      in thousands)                                                                                                                |
| Certificates      of deposit |                        $139,030                       |                           $31,546 |                             $  9,523 |                              $         175 |                           $180,274 |
| FHLB      advances           |                            76,192 |                      45,690 |                        18,000 |                       5,700 |                         145,582 |

|                                     | Contract      orNotional      Amount |
|------------------------------------------|--------------------------------------|
|                                     | (in      thousands)                  |
| Commitments      to originate loans:     |                                 |
| Fixed      rate                          | $  9,206                   |
| Adjustable      rate                     | 5,457                                |
| Undisbursed      balance of loans closed | 6,270                                |
| Unused      lines of credit              | 43,975                               |
| Commercial      letters of credit        | 500                                  |
| Total                                    | $65,543                              |

----

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| ·   | Changes      in economic conditions, particularly a further economic slowdown in The      Treasure Valley, could hurt ourbusiness. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------|

| o   | loan      delinquencies may increase; |
|---------------|---------------------------------------|

| o   | problem      assets and foreclosures mayincrease; |
|---------------|---------------------------------------------------|

| o   | demand      for our products and services may decline;and |
|---------------|-----------------------------------------------------------|

| o   | collateral      for loans made by us, especially real estate, may decline in value, in      turn reducing a customer’s borrowing power and reducing the value of      assets and collateral securing ourloans. |
|---------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Downturns      in the real estate markets in our primary market area could hurt our      business. |
|--------------------|----------------------------------------------------------------------------------------------------|

| ·   | We      may suffer losses in our loan portfolio despite our underwriting      practices. |
|--------------------|------------------------------------------------------------------------------------------|

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|   |   2.1 | Plan      of Conversion and Reorganization (1)                                                                                                                                                                                                                |
|--------|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   3.1 | Articles      of Incorporation of the Registrant (2)                                                                                                                                                                                                          |
|   |   3.2 | Bylaws      of the Registrant (2)                                                                                                                                                                                                                             |
|   | 10.1            | Amended      Employment Agreement entered into by Home Federal Bank with Len E.      Williams (9)                                                                                                                                                             |
|   | 10.2            | Employment      Agreement entered into by Home Federal Bancorp, Inc. with Len E. Williams      (9)                                                                                                                                                            |
|   | 10.3            | Amended      Employment Agreement entered into by Home Federal Bank with Daniel L.      Stevens (9)                                                                                                                                                           |
|   | 10.4            | Amended      Employment Agreement entered into by Home Federal Bancorp, Inc. with      Daniel L. Stevens (9)                                                                                                                                                  |
|   | 10.5            | Form      of Amended Severance Agreement for Executive Officers  (7)                                                                                                                                                                                          |
|   | 10.6            | Form      of Amended Severance Agreement for new Executive Officers    (7)                                                                                                                                                                                    |
|   | 10.7            | Form      of Home Federal Savings and Loan Association of Nampa Employee Severance      Compensation Plan (2)                                                                                                                                                 |
|   | 10.8            | Form      of Director Indexed Retirement Agreement entered into by Home Federal      Savings and Loan Association of Nampa with each of its Directors      (2)                                                                                                |
|   | 10.9            | Form      of Director Deferred Incentive Agreement entered into by Home Federal      Savings and Loan Association of Nampa with each of its Directors      (2)                                                                                                |
|   | 10.10           | Form      of Split Dollar Agreement entered into by Home Federal Savings and Loan      Association of Nampa with Daniel L. Stevens, N. Charles Hedemark, Fred H.      Helpenstell, M.D., Richard J. Schrandt, James R. Stamey and Robert A.      Tinstman (2) |
|   | 10.11           | Form      of Executive Deferred Incentive Agreement, and amendment thereto, entered      into by Home Federal Savings and Loan Association of Nampa with Daniel L.      Stevens, Robert A. Schoelkoph, and Lynn A. Sander (2)                                 |
|   | 10.12           | Form      of Amended and Restated Salary Continuation Agreement entered into by Home      Federal Savings and Loan Association of Nampa with Daniel L. Stevens, Len      E. Williams, Steven E. Emerson, Robert A. Schoelkoph, and Lynn A. Sander      (2)    |
|   | 10.13           | 2005      Stock Option and Incentive Plan approved by stockholders on June 23, 2005      and Form of Incentive Stock Option Agreement and Non-Qualified Stock      Option Agreement  (3)                                                            |
|   | 10.14           | 2005      Recognition and Retention Plan approved by stockholders on June 23, 2005      and Form of Award Agreement  (3)                                                                                                                            |
|   | 10.15           | Form      of new Director Retirement Plan entered into by Home Federal Bank with      each of its Directors (4)                                                                                                                                               |
|   | 10.16           | Transition      Agreement with Daniel L. Stevens (5)                                                                                                                                                                                                          |
|   | 10.17           | Agreement      Regarding Terms of Employment Offer with Steven K. Eyre  (6)                                                                                                                                                                                   |
|   | 10.18           | Agreement      Regarding Terms of Employment Offer with Eric S. Nadeau  (8)                                                                                                                                                                                   |
|   | 31.1            | Certification      of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley      Act                                                                                                                                                          |
|   | 31.2            | Certification      of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley      Act                                                                                                                                                          |
|   | 32              | Certification      Pursuant to Section 906 of the Sarbanes-Oxley  Act                                                                                                                                                                                         |

| (1)         |  Filed      as an exhibit to the Registrant’s Current Report on Form 8-K dated May 11,      2007.     |
|-----------------------|------------------------------------------------------------------------------------------------------------------|
| (2)         | Filed      as an exhibit to the Registrant's Registration Statement on Form S-1      (333-35817).      |
|  (3)   | Filed      as an exhibit to the Registrant’s Registration Statement on Form S-8      (333-127858).    |
|  (4)   | Filed      as an exhibit to the Registrant’s Current Report on Form 8-K dated October      21, 2005.  |
| (5)         | Filed      as an exhibit to the Registrant’s Current Report on Form 8-K dated August      21, 2006.        |

| (6)   | Filed      as an exhibit to the Registrant’s Current Report on Form 8-K dated      November 15, 2007. |
|-----------------|-------------------------------------------------------------------------------------------------------------|

| (7)   | Filed      as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the      quarter ended December 31, 2007. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------|

| (8)   | Filed      as an exhibit to the Registrant’s Current Report on Form 8-K dated May 15,      2008. |
|-----------------|--------------------------------------------------------------------------------------------------------|

| (9)   | Filed      as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the      quarter ended March 31, 2008 |
|-----------------|----------------------------------------------------------------------------------------------------------------------------|

----

----

| 31.1 | Certification      of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley      Act |
|------|------------------------------------------------------------------------------------------------------|
| 31.2 | Certification      of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley      Act |
| 32   | Certification      Pursuant to Section 906 of the Sarbanes-Oxley  Act                                |

----

| 1. | I      have reviewed this Quarterly Report on Form 10-Q of Home Federal Bancorp,      Inc.; |
|----|---------------------------------------------------------------------------------------------|

| 2. | Based      on my knowledge, this report does not contain any untrue statement of a      material fact or omit to state a material fact necessary to make the      statements made, in light of the circumstances under which such statements      were made, not misleading with respect to the period covered by this      report; |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3. | Based      on my knowledge, the financial statements, and other financial information      included in this report, fairly present in all material respects the      financial condition, results of operations and cash flows of the      registrant as of, and for, the periods presented in this      report; |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | The      registrant’s other certifying officer(s) and I are responsible for      establishing and maintaining disclosure controls and procedures (as      defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal      control over financial reporting (as defined in Exchange Act Rules      13a-15(f) and 15d-15(f)) for the registrant and  have: |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a)   | Designed      such disclosure controls and procedures, or caused such disclosure      controls and procedures to be designed under our supervision, to ensure      that material information relating to the registrant, including its      consolidated subsidiaries, is made known to us by others within those      entities, particularly during the period in which this quarterly report is      being prepared; |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | Designed      such internal control over financial reporting, or caused such internal      control over financial reporting to be designed under our supervision, to      provide reasonable assurance regarding the reliability of financial      reporting and the preparation of financial statements for external      purposes in accordance with generally accepted accounting      principles; |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c)   | Evaluated      the effectiveness of the registrant’s disclosure controls and procedures      and presented in this report our conclusions about the effectiveness of      the disclosure controls and procedures, as of the end of the period      covered by this report based on such evaluation;  and |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d)   | Disclosed      in this report any change in the registrant’s internal control over      financial reporting that occurred during the registrant’s most recent      fiscal quarter (the registrant’s fiscal fourth quarter in the case of an      annual report) that has materially affected, or is reasonably likely to      materially affect, the registrant’s internal control over financial      reporting; and |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | The      registrant’s other certifying officer(s) and I have disclosed, based on      our most recent evaluation of internal control over financial reporting,      to the registrant’s auditors and the audit committee of registrant’s board      of directors (or persons performing the equivalent    functions): |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a)   | All      significant deficiencies and material weakness in the design or operation      of internal control over financial reporting which are reasonably likely      to adversely affect the registrant’s ability to record, process, summarize      and report financial data information;and |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | Any      fraud, whether or not material, that involves management or other      employees who have a significant role in the registrant’s internal control      over financial reporting. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 1. | I      have reviewed this Quarterly Report on Form 10-Q of Home Federal Bancorp,      Inc.; |
|----|---------------------------------------------------------------------------------------------|

| 2. | Based      on my knowledge, this report does not contain any untrue statement of a      material fact or omit to state a material fact necessary to make the      statements made, in light of the circumstances under which such statements      were made, not misleading with respect to the period covered by this      report; |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3. | Based      on my knowledge, the financial statements, and other financial information      included in this report, fairly present in all material respects the      financial condition, results of operations and cash flows of the      registrant as of, and for, the periods presented in this      report; |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | The      registrant’s other certifying officer(s) and I are responsible for      establishing and maintaining disclosure controls and procedures (as      defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal      control over financial reporting (as defined in Exchange Act Rules      13a-15(f) and 15d-15(f)) for the registrant and  have: |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a)   | Designed      such disclosure controls and procedures, or caused such disclosure      controls and procedures to be designed under our supervision, to ensure      that material information relating to the registrant, including its      consolidated subsidiaries, is made known to us by others within those      entities, particularly during the period in which this quarterly report is      being prepared; |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | Designed      such internal control over financial reporting, or caused such internal      control over financial reporting to be designed under our supervision, to      provide reasonable assurance regarding the reliability of financial      reporting and the preparation of financial statements for external      purposes in accordance with generally accepted accounting      principles; |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c)   | Evaluated      the effectiveness of the registrant’s disclosure controls and procedures      and presented in this report our conclusions about the effectiveness of      the disclosure controls and procedures, as of the end of the period      covered by this report based on such evaluation;  and |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d)   | Disclosed      in this report any change in the registrant’s internal control over      financial reporting that occurred during the registrant’s most recent      fiscal quarter (the registrant’s fiscal fourth quarter in the case of an      annual report) that has materially affected, or is reasonably likely to      materially affect, the registrant’s internal control over financial      reporting; and |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | The      registrant’s other certifying officer(s) and I have disclosed, based on      our most recent evaluation of internal control over financial reporting,      to the registrant’s auditors and the audit committee of registrant’s board      of directors (or persons performing the equivalent    functions): |
|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a)   | All      significant deficiencies and material weakness in the design or operation      of internal control over financial reporting which are reasonably likely      to adversely affect the registrant’s ability to record, process, summarize      and report financial data information;and |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | Any      fraud, whether or not material, that involves management or other      employees who have a significant role in the registrant’s internal control      over financial reporting. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 1. | the      Report fully complies with the requirements of Section 13(a) or 15(d) of      the Securities Exchange Act of 1934, as amended;  and |
|----|----------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | the      information contained in the Report fairly presents, in all material      respects, the financial condition and results of operations of the Company      as of the dates and for the periods presented in the financial statements      included in the Report. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----