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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549



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Form 10-QSB



(Mark One)



| ̈ |  | Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended
.
|- |  | ------------------------------------------------------------------------------------------------------------------



|x |  | Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from 4/1/03 to 6/30/03.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------



Commission file number 0-24151



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NORTHWEST BANCORPORATION, INC.

(Exact name of small business issuer as
specified in its charter)



|Washington                                                     |  | 91-1574174                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer identification No.)



421 West Riverside,
Spokane, WA 99201-0403

(Address of principal executive offices)



(509) 456-8888

(Issuers telephone number, including area code)



APPLICABLE ONLY TO CORPORATE ISSUERS



The
Registrant has a single class of common stock, of which there are 1,901,449 shares issued and outstanding as of June 30, 2003.



Transitional Small Business Disclosure Format:



Yes x     No ̈



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##### Table of Contents

Table of Contents



|               |  |         | 
|-------------- |  | ------- | 
|               |  |         | 
|               |  |         | 
|Part I         |  |         | 
|               |  |         | 
|               |  | Item 1. | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  |         | 
|               |  | Item 2. | 
|               |  |         | 
|               |  | Item 3. | 
|               |  |         | 
|Part II        |  |         | 
|               |  |         | 
|               |  | Item 2. | 
|               |  |         | 
|               |  | Item 4. | 
|               |  |         | 
|               |  | Item 6. | 
|               | 
|Signatures     |  | 11     
|               | 
|Certifications |  |        



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##### Table of Contents

Part I    Financial Information

Item 1.    Financial Statements



NORTHWEST BANCORPORATION, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CONDITION

June 30, 2003 and December 31, 2002

($ in thousands)



|                                                                                                                                                 |  | June 302003 |         | December 312002
|------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----------- | ------- | ---------------
|Assets                                                                                                                                           |  |             |         |                
|Cash and due from banks                                                                                                                          |  | $           | 9,609   |                
|Federal funds sold/FHLB interest bearing balances                                                                                                |  |             | 9,258   |                
|Securities held-to-maturity (Note 2)                                                                                                             |  |             | 2,098   |                
|Securities available-for-sale (Note 2)                                                                                                           |  |             | 36,036  |                
|Federal Home Loan Bank stock, at cost                                                                                                            |  |             | 610     |                
|Loans, net of allowance for loan losses of $2,291 in 2003 and $2,026 in 2002 (Notes 3 & 4)                                                       |  |             | 141,387 |                
|Loans held for sale                                                                                                                              |  |             | 2,532   |                
|Accrued interest receivable                                                                                                                      |  |             | 955     |                
|Premises and equipment, net                                                                                                                      |  |             | 3,361   |                
|Foreclosed real estate                                                                                                                           |  |             | 1,477   |                
|Other assets                                                                                                                                     |  |             | 2,707   |                
|                                                                                                                                                 |  |             |         |                
|TOTAL ASSETS                                                                                                                                     |  | $           | 210,030 |                
|                                                                                                                                                 |  |             |         |                
|                                                                                                                                                 |  |            
|Liabilities                                                                                                                                      |  |             |         |                
|Noninterest bearing demand deposits                                                                                                              |  | $           | 32,971  |                
|Money Market accounts                                                                                                                            |  |             | 50,006  |                
|NOW accounts                                                                                                                                     |  |             | 19,005  |                
|Savings accounts                                                                                                                                 |  |             | 5,729   |                
|Time Certificates of Deposit, $100,000 and over                                                                                                  |  |             | 20,952  |                
|Time Certificates of Deposit, under $100,000                                                                                                     |  |             | 40,610  |                
|                                                                                                                                                 |  |             |         |                
|TOTAL DEPOSITS                                                                                                                                   |  |             | 169,273 |                
|Securities sold under agreement to repurchase                                                                                                    |  |             | 15,934  |                
|Borrowed funds, Federal Home Loan Bank (Note 5)                                                                                                  |  |             | 5,797   |                
|Accrued interest payable and other liabilities                                                                                                   |  |             | 1,148   |                
|                                                                                                                                                 |  |             |         |                
|TOTAL OTHER LIABILITIES                                                                                                                          |  |             | 22,879  |                
|                                                                                                                                                 |  |             |         |                
|TOTAL DEPOSITS & LIABILITIES                                                                                                                     |  |             | 192,152 |                
|                                                                                                                                                 |  |             |         |                
|                                                                                                                                                 |  |            
|Stockholders Equity                                                                                                                             |  |             |         |                
|Common stock, no par, 5,000,000 shares authorized; issued and outstanding 1,901,449 on June 30, 2003 and 1,898,752 on December 31,
2002 (Note 6) |  |             | 15,357  |                
|Retained earnings                                                                                                                                |  |             | 1,863   |                
|Accumulated other comprehensive income, net of tax of $339 for 2003 and $404 for 2002                                                            |  |             | 658     |                
|                                                                                                                                                 |  |             |         |                
|TOTAL STOCKHOLDERS EQUITY                                                                                                                       |  |             | 17,878  |                
|                                                                                                                                                 |  |             |         |                
|TOTAL LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                       |  | $           | 210,030 |                
|                                                                                                                                                 |  |             |         |                



The accompanying Notes are an integral
part of these condensed financial statements.



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NORTHWEST BANCORPORATION, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF INCOME

Three months and six-months, year-to-date, ended June 30, 2003 and 2002

($ in thousands, except number of shares and per share information)



|                                                                      |  | Quarter ended June 30 |           | Six-months, year-to-date
|--------------------------------------------------------------------- |  | --------------------- | --------- | ------------------------
|                                                                      |  | 2003                  |           | 2002                    
|Interest Income                                                       |  |                       |           |                         
|Interest and fees on loans                                            |  | $                     | 2,470     |                         
|Interest on securities                                                |  |                       | 446       |                         
|Interest on federal funds sold                                        |  |                       | 32        |                         
|                                                                      |  |                       |           |                         
|TOTAL INTEREST INCOME                                                 |  |                       | 2,948     |                         
|                                                                      |  |                       |           |                         
|Interest Expense                                                      |  |                       |           |                         
|Interest on deposits                                                  |  |                       | 694       |                         
|Interest on securities sold under agreement to repurchase             |  |                       | 22        |                         
|Interest on borrowed funds                                            |  |                       | 78        |                         
|                                                                      |  |                       |           |                         
|TOTAL INTEREST EXPENSE                                                |  |                       | 794       |                         
|NET INTEREST INCOME                                                   |  |                       | 2,154     |                         
|Provision for loan losses                                             |  |                       | 188       |                         
|                                                                      |  |                       |           |                         
|                                                                      |  |                       |           |                         
|NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES                   |  |                       | 1,966     |                         
|Noninterest Income                                                    |  |                       |           |                         
|Fees and service charges                                              |  |                       | 271       |                         
|Net gain from sale of loans                                           |  |                       | 239       |                         
|Other noninterest income                                              |  |                       | 115       |                         
|                                                                      |  |                       |           |                         
|TOTAL NONINTEREST INCOME                                              |  |                       | 625       |                         
|Noninterest Expense                                                   |  |                       |           |                         
|Salaries and employee benefits                                        |  |                       | 1,198     |                         
|Occupancy/FF&E expense                                                |  |                       | 185       |                         
|Depreciation and amortization expense                                 |  |                       | 118       |                         
|Other operating expense                                               |  |                       | 466       |                         
|                                                                      |  |                       |           |                         
|                                                                      |  |                       |           |                         
|TOTAL NONINTEREST EXPENSE                                             |  |                       | 1,967     |                         
|INCOME BEFORE TAXES                                                   |  |                       | 624       |                         
|Income tax expense                                                    |  |                       | 221       |                         
|                                                                      |  |                       |           |                         
|NET INCOME                                                            |  | $                     | 403       |                         
|                                                                      |  |                       |           |                         
|                                                                      |  |                       |           |                         
|                                                                      |  | Quarter ended June 30 |           | Six-months, year-to-date
|                                                                      |  | 2003                  |           | 2002                    
|Weighted average shares outstanding (Note 6)                          |  |                       | 1,900,487 |                         
|Basic earnings per share                                              |  | $                     | 0.21      |                         
|                                                                      |  |                       |           |                         
|Weighted average shares outstanding (Note 6)                          |  |                       | 1,900,487 |                         
|Effect of dilutive securities                                         |  |                       | 14,355    |                         
|Weighted average shares outstanding, adjusted for dilutive securities |  |                       | 1,914,842 |                         
|Earnings per share assuming full dilution                             |  | $                     | 0.21      |                         
|                                                                      |  |                       |           |                         



The accompanying Notes are an integral
part of these condensed financial statements.



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NORTHWEST BANCORPORATION, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOW

Six-months, year-to-date, ended June 30, 2003 and 2002

($ in thousands)



|                                                                              |  | Year-to-date |       
|----------------------------------------------------------------------------- |  | ------------ | ------
|                                                                              |  | 2003         |       
|Net income                                                                    |  | $            | 777   
|Adjustments to reconcile net income to cash provided by operating activities: |  |              |       
|Provision for loan losses                                                     |  |              | 413   
|Depreciation and amortization                                                 |  |              | 238   
|(Increase)/decrease in assets and liabilities:                                |  |              |       
|Accrued interest receivable                                                   |  |              | 108   
|Net (increase)/decrease in loans held for sale                                |  |              | (1,868
|Other assets                                                                  |  |              | (597  
|Accrued interest payable & other liabilities                                  |  |              | (1    
|                                                                              |  |              |       
|NET CASH PROVIDED BY OPERATING ACTIVITIES                                     |  |              | (930  
|                                                                              |  |             
|Cash flows from investing activities:                                         |  |              |       
|Net (increase)/decrease in federal funds sold/FHLB interest bearing balances  |  |              | (8,664
|Net (increase)/decrease in investment securities                              |  |              | 15,908
|Net (increase)/decrease in loans                                              |  |              | (6,776
|Purchase of premises and equipment net of gain or loss on asset disposal      |  |              | (33   
|Foreclosed real estate activity (net)                                         |  |              | (365  
|                                                                              |  |              |       
|NET CASH PROVIDED/(USED) BY INVESTING ACTIVITIES                              |  |              | 70    
|                                                                              |  |              |       
|Cash flows from financing activities:                                         |  |              |       
|Net increase/(decrease) in deposits                                           |  |              | 3,216 
|Net increase/(decrease) in securities sold under agreement to repurchase      |  |              | (2,036
|Net proceeds/(payments) from borrowed funds                                   |  |              | (790  
|Cash received from stock sales (net)                                          |  |              | 30    
|Cash dividend paid/purchase partial shares created by stock dividend          |  |              | (184  
|                                                                              |  |              |       
|NET CASH PROVIDED/(USED) BY FINANCING ACTIVITIES                              |  |              | 236   
|Net increase/(decrease) in cash and cash equivalents                          |  |              | (624  
|Cash and due from banks, beginning of year                                    |  |              | 10,233
|                                                                              |  |              |       
|CASH AND DUE FROM BANKS, END OF QUARTER                                       |  | $            | 9,609 
|                                                                              |  |              |       



The accompanying Notes are an integral
part of these condensed financial statements.



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NORTHWEST BANCORPORATION, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY

In Actual Dollars

As of June 30, 2003



|                                                                     |  | Total |            |   | CommonStock |   |            | RetainedEarnings |  |   | AccumulatedComprehensiveIncome |   |  | ComprehensiveIncome |         
|-------------------------------------------------------------------- |  | ----- | ---------- | - | ----------- | - | ---------- | ---------------- |  | - | ------------------------------ | - |  | ------------------- | --------
|Balance, December 31, 2001                                           |  | $     | 15,578,705 |   |             | $ | 13,495,186 |                  |  | $ | 1,666,961                      |   |  | $                   | 416,558 
|Net income 2002                                                      |  |       | 1,418,702  |   |             |   |            |                  |  |   | 1,418,702                      |   |  |                     |         
|Unrealized gains on available for sale securities                    |  |       | 367,067    |   |             |   |            |                  |  |   |                                |   |  |                     | 367,067 
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Comprehensive income                                                 |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Proceeds from issuance of common stock                               |  |       | 27,802     |   |             |   | 27,802     |                  |  |   |                                |   |  |                     |         
|Repurchase of common stock                                           |  |       | (9,161     | ) |             |   | (9,161     | )                |  |   |                                |   |  |                     |         
|Fractional shares, issued in cash                                    |  |       | (2,289     | ) |             |   |            |                  |  |   | (2,289                         | ) |  |                     |         
|Transfers                                                            |  |       |           |   |             |   | 811,462    |                  |  |   | (811,462                       | ) |  |                     |         
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Balance December 31, 2002                                            |  |       | 17,380,826 |   |             |   | 14,325,289 |                  |  |   | 2,271,912                      |   |  |                     | 783,625 
|Net income, 2003, year-to-date                                       |  |       | 776,777    |   |             |   |            |                  |  |   | 776,777                        |   |  |                     |         
|Unrealized losses on available for sale securities                   |  |       | (125,719   | ) |             |   |            |                  |  |   |                                |   |  |                     | (125,719
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Comprehensive income                                                 |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Proceeds from issuance of common stock                               |  |       | 31,148     |   |             |   | 31,148     |                  |  |   |                                |   |  |                     |         
|Repurchase of common stock                                           |  |       | (1,241     | ) |             |   | (1,241     | )                |  |   |                                |   |  |                     |         
|Cash dividend paid/purchase partial shares created by stock dividend |  |       | (183,620   | ) |             |   |            |                  |  |   | (183,620                       | ) |  |                     |         
|Transfers                                                            |  |       |           |   |             |   | 1,002,252  |                  |  |   | (1,002,252                     | ) |  |                     |         
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Balance, end-of-quarter, June 30, 2003                               |  | $     | 17,878,171 |   |             | $ | 15,357,448 |                  |  | $ | 1,862,817                      |   |  | $                   | 657,906 
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Disclosure of 2003 reclassification amount:                          |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Unrealized holding loss during period                                |  | $     | (93,236    | ) |             |   |            |                  |  |   |                                |   |  |                     |         
|Reclassification adjustment for gains reported in net income         |  |       | (32,483    | ) |             |   |            |                  |  |   |                                |   |  |                     |         
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         
|Net unrealized loss on securities                                    |  | $     | (125,719   | ) |             |   |            |                  |  |   |                                |   |  |                     |         
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |  |                     |         



The accompanying Notes are an integral
part of these condensed financial statements.



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NORTHWEST BANCORPORATION, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY

In Actual Dollars

As of June 30, 2002



|                                                                     |  | Total |            |   | CommonStock |   |            | RetainedEarnings |  |   | AccumulatedComprehensiveIncome |   | ComprehensiveIncome
|-------------------------------------------------------------------- |  | ----- | ---------- | - | ----------- | - | ---------- | ---------------- |  | - | ------------------------------ | - | -------------------
|Balance, December 31, 2000                                           |  | $     | 14,335,792 |   |             | $ | 12,836,358 |                  |  | $ | 1,308,515                      |   |                    
|Net income 2001                                                      |  |       | 1,188,815  |   |             |   |            |                  |  |   | 1,188,815                      |   |                    
|Unrealized gains on available for sale securities                    |  |       | 225,639    |   |             |   |            |                  |  |   |                                |   |                    
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Comprehensive income                                                 |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Proceeds from issuance of common stock                               |  |       | 52,360     |   |             |   | 52,360     |                  |  |   |                                |   |                    
|Repurchase of common stock                                           |  |       | (221,532   | ) |             |   | (221,532   | )                |  |   |                                |   |                    
|Fractional shares, issued in cash                                    |  |       | (2,369     | ) |             |   |            |                  |  |   | (2,369                         | ) |                    
|Transfers                                                            |  |       |           |   |             |   | 828,000    |                  |  |   | (828,000                       | ) |                    
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Balance December 31, 2001                                            |  |       | 15,578,705 |   |             |   | 13,495,186 |                  |  |   | 1,666,961                      |   |                    
|Net income, 2002, year-to-date                                       |  |       | 601,648    |   |             |   |            |                  |  |   | 601,648                        |   |                    
|Unrealized gains on available for sale securities                    |  |       | 89,634     |   |             |   |            |                  |  |   |                                |   |                    
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Comprehensive income                                                 |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Proceeds from issuance of common stock                               |  |       | 27,802     |   |             |   | 27,802     |                  |  |   |                                |   |                    
|Repurchase of common stock                                           |  |       | (9,161     | ) |             |   | (9,161     | )                |  |   |                                |   |                    
|Cash dividend paid/purchase partial shares created by stock dividend |  |       | (2,289     | ) |             |   |            |                  |  |   | (2,289                         | ) |                    
|Transfers                                                            |  |       |           |   |             |   | 811,462    |                  |  |   | (811,462                       | ) |                    
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Balance, end-of-quarter, June 30, 2002                               |  | $     | 16,286,339 |   |             | $ | 14,325,289 |                  |  | $ | 1,454,858                      |   |                    
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Disclosure of 2002 reclassification amount:                          |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Unrealized holding gains during period                               |  | $     | 88,685     |   |             |   |            |                  |  |   |                                |   |                    
|Reclassification adjustment for losses reported in net income        |  |       | 949        |   |             |   |            |                  |  |   |                                |   |                    
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |                    
|Net unrealized gains on securities                                   |  | $     | 89,634     |   |             |   |            |                  |  |   |                                |   |                    
|                                                                     |  |       |            |   |             |   |            |                  |  |   |                                |   |                    



The accompanying Notes are an integral
part of these condensed financial statements.



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Notes to Consolidated Financial Statements



NOTE
1.    Management Statement



In the
opinion of the Company, the accompanying audited and unaudited Consolidated Financial Statements reflect all adjustments necessary for a fair presentation of the financial position of the Company as of June 30, 2003 and December 31, 2002, as well as
the results of operations and changes in financial position for the three-month and six-month, year-to-date periods ended June 30, 2003 and 2002. Certain information and footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed statements be read in conjunction with the Independent Auditors Report and Financial
Statements contained in the Companys most recent Annual Report on Form 10-KSB as of December 31, 2002.



Certain reclassifications of June 30, 2002 balances have been made to conform to the June 30, 2003 presentation; there was no impact on net income or
stockholders equity. Shares outstanding and calculation of earnings per share have been restated for the three-month and six-month, year-to-date periods ending June 30, 2002 to reflect the effect of a five-percent stock dividend effective for
shareholders of record as of May 15, 2003.



NOTE
2.    Securities



Most of the
securities are classified as available-for-sale and are stated at fair value, and unrealized holding gains and losses, net of related deferred taxes, are reported as a separate component of stockholders equity. Gains or losses on
available-for-sale securities sales are reported as part of non-interest income based on the net proceeds and the adjusted carrying amount of the securities sold, using the specific identification method. Realized net gains of $32,483 are included
in the financial results for the six-month, year-to-date period ending June 30, 2003. Realized net losses of $949 are included in the financial results for the three-month and six-month, year-to-date periods ending June 30, 2002. Carrying amounts
and fair values at June 30, 2003 and December 31, 2002 were as follows (in thousands):



|                                                                 |  | June 30, 2003 |        | December 31, 2002
|---------------------------------------------------------------- |  | ------------- | ------ | -----------------
|                                                                 |  | AmortizedCost |        | FairValue        
|Securities available-for-sale:                                   |  |               |        |                  
|US Treasury securities                                           |  | $             | 7,152  |                  
|Obligations of federal government agencies                       |  |               | 18,525 |                  
|Mortgage backed securities                                       |  |               | 4,878  |                  
|Corporate Bonds                                                  |  |               | 4,484  |                  
|                                                                 |  |               |        |                  
|TOTAL                                                            |  | $             | 35,039 |                  
|                                                                 |  |               |        |                  
|Securities held-to-maturity:                                     |  |               |        |                  
|Obligations of states, municipalities and political subdivisions |  | $             | 2,098  |                  
|                                                                 |  |               |        |                  



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NOTE 3.    Loans



Loan detail by category as of June 30, 2003 and December 31, 2002 is as follows (in thousands):



|                          |  | June 302003 |         | December 312002
|------------------------- |  | ----------- | ------- | ---------------
|Commercial loans          |  | $           | 114,256 |                
|Real estate loans         |  |             | 18,069  |                
|Installment loans         |  |             | 4,426   |                
|Consumer and other loans  |  |             | 7,222   |                
|                          |  |             |         |                
|TOTAL LOANS               |  | $           | 143,973 |                
|                          |  |             |         |                
|Allowance for loan losses |  |             | -2,291  |                
|Net deferred loan fees    |  |             | -295    |                
|                          |  |             |         |                
|NET LOANS                 |  | $           | 141,387 |                
|                          |  |             |         |                



NOTE
4.    Allowance for Loan Losses



The
allowance for loan loss is maintained at levels considered adequate by management to provide for possible loan losses. The allowance is based on managements assessment of various factors affecting the loan portfolio, including problem loans,
business conditions and loss experience, and an overall evaluation of the quality of underlying collateral. Changes in the allowance for loan loss during the three-month and six-month, year-to-date periods ended June 30, 2003 and 2002 were as
follows (in thousands):



|                             |  | Three Months Ended |       | Year-to-date
|---------------------------- |  | ------------------ | ----- | ------------
|                             |  | 06/30/2003         |       | 06/30/2002  
|Balance, beginning of period |  | $                  | 2,172 |             
|Provision for loan losses    |  |                    | 188   |             
|Loan Charge-offs             |  |                    | 91    |             
|Loan Recoveries              |  |                    | 22    |             
|                             |  |                    |       |             
|Balance, end of period       |  | $                  | 2,291 |             



NOTE
5.    Borrowed Funds



The
Companys subsidiary, Inland Northwest Bank, has unsecured operating lines of credit with Key Bank of Washington for $6,000,000, US Bank for $1,500,000 and Zions Bank for $1,500,000. The Bank also has a secured line of credit with the Federal
Home Loan Bank of Seattle (FHLB) for approximately $21,000,791 (10.0% of Bank assets.) There were no balances outstanding on any of the lines on June 30, 2003 or 2002. On December 31, 2002 there was $600,000 outstanding on the FHLB line. In addition
to overnight funds, the Bank has access to long-term funding through the FHLB in the approximate amount of $10,500,395 (5.0% of Bank assets) and has taken advances to fund Community Investment Program and other loans utilizing these funds. Long-term
notes payable to the FHLB were $5,796,568 on June 30, 2003 and $5,986,574 on December 31, 2002.



NOTE 6.    Common Stock



On February 18, 2003, the Board of Directors declared a five-percent stock dividend payable to shareholders of record as of May 15, 2003. Shares reported as outstanding as of December 31, 2002, as well as
earnings per share and weighted average and actual shares outstanding for the three-month and six-month, year-to-date periods ending June 30, 2002, have been restated to reflect the stock dividend.



On February 18, 2003, the Board of Directors declared a ten-cent ($0.10) per
share cash dividend, which was paid on April 4, 2003 to shareholders of record as of March 21, 2003.



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Item 2.    Managements Discussion and Analysis or Plan of Operation



The Registrant relied upon Alternative 2 in its registration statement filed on Form 10-SB; there is no information to provide in response to Item
6(a)(3)(i) to Model B of Form 1-A.



Item 3. Controls and Procedures



The officers signing this report: are responsible for maintaining internal controls; have designed such internal controls to ensure that material information relating to the Company and its consolidated subsidiary is made known to them by
others within those entities, particularly for the period(s) for and in which this report was being prepared; have evaluated the effectiveness of the Companys internal controls as of a date within 90 days prior to this report; and, believe
that, as of the date of this report and for the periods presented, existing internal controls are effective and adequate based on their evaluation. There have been no significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.



Part II Other Information



Item 2.    Changes in Securities



A five-percent stock dividend was declared by the directors on February 18, 2003, payable to stockholders of record as of May 15, 2003; 90,545 shares [including 252 shares resulting from payment of partial shares in
cash and the accumulation and sale of those partial shares to bank employees] were issued and delivered on June 13, 2003. During the second quarter of the 2003 fiscal year, the Registrant issued 2,700 shares of common stock to non-employee directors
pursuant to the Registrants compensation plan for non-employee directors; this plan provides for the issuance of 200 shares annually to each non-employee director, with an additional 100 shares to the chairperson, provided completion of twelve
months of service prior to the annual shareholder meeting.



The
Registrant believes that the issuance of these shares of common stock was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933.



Item 4.    Submission of Matters to a Vote of Security Holders



The annual meeting of shareholders of the Registrant was held on Monday, May 19, 2003. In addition to the election of Directors described in the proxy
material furnished to the shareholders pursuant to Regulation 14A, the shareholders also ratified the selection of Moss Adams, LLP, 601 West Riverside Avenue, Suite 1800, Spokane, Washington 99202-0663, as independent public accountants for the
Company for the fiscal year ending December 31, 2003. 1,583,792 shares were voted in favor of the ratification with 162 shares being voted against or withheld, including abstentions and broker non-votes.



Item 6.    Exhibits and Reports on Form 8-K



| | (a) |  | Exhibit 31.1
| | --- |  | ------------

Certification of Randall L. Fewel,
President and Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.



Exhibit 31.2

Certification of Christopher
C. Jurey, Executive Vice President and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.



Exhibit 32.1

Certification of Randall L.
Fewel, President and Chief Executive Officer pursuant to 18 U.S.C. 1350.



Exhibit 32.2

Certification of Christopher C. Jurey, Executive Vice President and Chief Financial Officer
pursuant to 18 U.S.C. 1350.



| | (b) |  | Reports on Form 8-K
| | --- |  | -------------------

The Company filed the following
report on Form 8-K during the period covered by this Report:



Report filed April 16, 2003. On April 16, 2003 the Company issued a press release announcing financial information

for the
first-quarter of 2003.



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SIGNATURES



In accordance with
Section 12 of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



NORTHWEST BANCORPORATION, INC.By:

/s/    RANDALL L.
FEWELRandall L. Fewel, President and Chief Executive Officer






Date: August 7, 2003



In accordance with Section 12 of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.



NORTHWEST BANCORPORATION, INC.By:

/s/    CHRISTOPHER C.
JUREYChristopher C. Jurey, Executive Vice President and Chief Financial Officer




Date: August 7, 2003



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