1406251--2/8/2010--WESTERN_LIBERTY

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{stock, price, share}

{acquisition, growth, future}

{loan, real, estate}

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{condition, economic, financial}

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{control, financial, internal}

{financial, litigation, operation}

{regulation, change, law}

{stock, price, operating}

{product, candidate, development}

{regulation, government, change}

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Future acquisitions will require regulatory approval and may be on terms that may not conform to our current business plan and our asset portfolio. Our geographic concentration will be tied to business, economic and regulatory conditions in Nevada. The Las Vegas market is substantially dependent on gaming and tourism revenue, and the downturn in the gaming and tourism industries has indirectly had an adverse impact on Nevada banks. The soundness of other financial institutions with which we do business could adversely affect us. Our earnings may be significantly affected by the fiscal and monetary policies of the federal government and its agencies. If there was a depletion of the FDIC s Deposit Insurance Fund, the FDIC could impose additional assessments on the banking industry. The financial services industry is heavily regulated by federal and state agencies. We operate in a highly regulated environment and changes in the laws and regulations that govern our operations, changes in the accounting principles that are applicable to us, and our failure to comply with the foregoing, may adversely affect us. A stockholder with a 5% or greater interest in Western Liberty Bancorp could, under certain circumstances, be subject to regulation as a bank holding company. Any current or future litigation, regulatory investigations, proceedings, inquiries or changes could have a significant impact on the financial services industry. The Emergency Economic Stabilization Act of 2008 (EESA) and the American Recovery and Reinvestment Act of 2009 (ARRA) may not stabilize the financial services industry or the U.S. economy. Current market volatility and industry developments may adversely affect business and financial results. Strategies to manage interest rate risk may yield results other than those anticipated. Negative public opinion could damage our reputation and adversely impact our business and revenues. Disruptions in our ability to access capital markets may negatively affect our capital resources and liquidity. Changes in interest rates could adversely affect our profitability, business and prospects. Increasing our existing market share may depend on market acceptance and regulatory approval of new products and services. Risks Related to the Acquisition The Acquisition is subject to the receipt of consents and approvals from regulatory authorities that may impose conditions that could have an adverse effect on us or, if not obtained, could prevent completion of the Acquisition. As a result of the Acquisition, the ownership interest of WLBC s current stockholders will be substantially reduced, resulting in a dilution of WLBC s current stockholders voting power. Our board of directors has approved the award of post-closing transaction related equity awards, which, if issued, would increase the number of shares eligible for future resale in the public market and result in dilution of our stockholders. The value of our capital stock could be adversely affected to the extent we fail to effectively integrate Service1st and realize the expected benefits of the Acquisition. Service1st may not be able to obtain the approval of its stockholders, which is required to consummate the Acquisition. If the Acquisition s benefits do not meet the expectations of financial or industry analysts, the market price of our securities may decline. Our current directors and executive officers have certain interests in consummating the Acquisition that may have influenced their decision to approve the Acquisition. The historical financial information included in this proxy statement/prospectus is not necessarily indicative of our future performance. Service1st has experienced significant losses since it began operations in January of 2007. There is no assurance that it will become profitable. The Service1st loan portfolio and any other loan portfolios we may acquire after the closing of the Acquisition may not perform as expected. Further deterioration in the quality of Service 1st s loan portfolio may result in additional charge-offs which will adversely effect our operating results. Most of the loans being acquired have been originated in the last three years and may have experienced performance which may not be representative of credit defaults in the future. A substantial portion of Service1st s loan portfolio consists of loans maturing within one year, and there is no guarantee that these loans will be replaced upon maturity or renewed on the same terms or at all. Service1st relies upon independent appraisals to determine the value of the real estate which secures a significant portion of its loans, and the values indicated by such appraisals may not be realizable if Service 1st is forced to foreclose upon such loans. As a de novo bank Service1st is subject to restrictions that may inhibit growth and initiatives not within its existing business plan. Service1st is subject to a Memorandum of Understanding and to regulatory restrictions that may affect its ability to obtain regulatory approval for future initiatives requiring such approval and to hire and retain qualified senior management. Risks Related to Western Liberty Bancorp Although we are required to use our commercially reasonable efforts to have an effective registration statement covering the issuance of the shares of common stock underlying exercisable warrants at the time that our warrant holders exercise their warrants, we cannot guarantee that a registration statement will be effective, in which case our warrant holders may not be able to exercise our warrants. We may choose to redeem our outstanding warrants at a time that is disadvantageous to our warrant holders. Our outstanding warrants may be exercised in the future, which would increase the number of shares eligible for future resale in the public market and result in dilution of our stockholders. The NYSE Amex may delist our securities on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. Our stock price could fluctuate and could cause you to lose a significant part of your investment. We do not expect to present any additional or alternative acquisitions to our stockholders for a vote, except as required under Delaware or other applicable law, or pursuant stock exchange rules. Furthermore, if the Acquisition is not approved, we will have unrestricted funds which we intend to use to make an alternative acquisition. As a result, you will possibly not have the opportunity to evaluate a potential acquisition, which would make your investment in us more speculative. If we are unable to effectively maintain a system of internal control over financial reporting, we may not be able to accurately or timely report financial results, which could materially adversely affect our business. Following the consummation of the Acquisition, our allowance for loan losses may not be adequate to cover actual loan losses, which may require us to take a charge to our earnings and adversely impact our financial condition and results of operations. Following the consummation of the Acquisition, if we are unable to recruit and retain experienced management personnel and recruit and retain additional qualified personnel, our business and prospects could be adversely affected. We are exposed to risk of environmental liabilities with respect to properties to which we take title.

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1406251--2/8/2010--WESTERN_LIBERTY_BANCORP