The Bank primarily grants residential loans to customers in Central and North Idaho and Southeast Washington. Tri Star's operations consist primarily of selling life insurance and tax deferred annuities to customers in the same geographic areas as the Bank operates. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported assets and liabilities and disclosures on contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are susceptible to significant change in the near-term relate to the determination of the allowance for loan losses.
Management believes that the allowance for loan losses is adequate.
While management uses current information to recognize losses on loans, future additions to the allowances may be necessary based on changes in economic conditions. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Bank's allowance for loan losses. Such agencies may require the Bank to recognize additions to the allowance based on their judgments about information available to them at the time of the examination.