PRESS RELEASE
April 26, 2005

Contact
Ken Parsons, President/CEO
(360) 459 -1100

Venture Financial Group Reports Record 1st Quarter Earnings

 FIRST QUARTER HIGHLIGHTS

Quarterly income and earnings per share increase 6.6% and 7.1%, respectively

Loans grow $77 million from same period in 2004

Interest income increases $1.2 million or 16%

Olympia, Wash. - April 26, 2005 - Ken F. Parsons, Sr., CEO of Venture Financial Group, Inc. ("Venture" or the "Company"), parent company of Venture Bank, (www.venture-bank.com) today announced first quarter net income of $2,033,000, an increase of 6.6% or $125,000 compared to $1,908,000 for the first quarter 2004. The $2,033,000 represents the highest first quarter earnings in Company history. Diluted earnings per share were $0.30 for the quarter ended March 31, 2005 up 7.1% from $0.28 for the same quarter in 2004.

For the quarter ended March 31, 2005, assets totaled $578 million, an increase of 13.6% over the $512 million in total assets at March 31, 2004. Total loans increased $77 million or 20.8% to $448 million from $371 million at March 31, 2004. Securities available for sale decreased $11 million or 13.5% to $70 million from $81 million. The cash received from this decrease has been used to fund loan growth over the last twelve months.

Demand deposits and interest-bearing demand deposits decreased 2.5% and 13.0% respectively for the period ending March 31, 2005 compared to the same period in 2004. Certificates of deposit increased by 6.3%. Total deposits decreased by $19 million or 5.0% to $359 million as of March 31, 2005. This decrease is directly attributable to the branch divestiture in the fourth quarter 2004. Excluding the sale of $96 million of deposits in the branch divesture, total deposits increased by $77 million or 27.3%.

"Our team is committed to the success of this company and adding value for our shareholders," said Ken F. Parsons Sr., Venture Financial Group Chairman and CEO.

Operating Results
Quarter Ended March 31, 2005

Net Interest Income
Net interest income for the first quarter of 2005 increased 6.6% to $6.5 million, from $6.1 million for the quarter ended March 31, 2004. This increase is due to a $1.2 million increase in interest income due to a $77 million increase in loan volume, offset by a $0.8 million increase in interest expense primarily due to a $76 million increase in borrowings following the sale of seven branches in the fourth quarter 2004.

Non Interest Income
Non interest income increased by $254,000 or 14.1% to a total of $2 million for the quarter ended March 2005 compared to $1.8 million for the same quarter in 2004. This increase is due largely to a one time gain on the sale of OREO property of $300,000.

Non Interest Expense
Total non interest expense increased by $405,000 or 8.2% for the three months ended March 31, 2005 compared to the three months ended March 31, 2004. This increase is due to a $176,000 increase in expenses associated with new marketing campaigns intended to bring in new deposits, and $158,000 in payroll expenses associated with the recent exit of the President and CFO.

"I am very pleased with the first quarter results of the company and look forward to a successful year" said Parsons.

Nonperforming Assets
Nonperforming assets (which includes nonperforming loans and other nonperforming assets) as a percentage of total assets was 0.92%, 1.05% and 0.68% as of March 31, 2005, December 31, 2004 and March 31, 2004 respectively. Nonperforming loans as a percentage of total loans was 1.10%, 1.18% and 0.53% as of March 31, 2005, December 31, 2004 and March 31, 2004 respectively.

"The credit quality of the loan portfolio remains strong as we grow the company. We have benefited from the strong commercial and residential real estate markets, establishing excellent relationships with premier borrowers in Thurston, Pierce and South King Counties," said Bruce Marley, Executive Vice President and Chief Lending Officer.

Venture Financial Group, through its wholly owned subsidiary Venture Bank, has 14 offices in four western Washington counties and offers a full spectrum of financial services including commercial, construction, residential and consumer lending, deposit products and other banking services. Further information about the Bank may be found on the Internet at www.venture-bank.com.

Note Regarding Forward-Looking Information
This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to certain risk factors, including those set forth from time to time in the Company’s filings with the Securities and Exchange Commission (the "SEC"). You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements.

Condensed Statements of Condition
Condensed Statements of Operations

Back to News Releases