948368--3/14/2007--PSB_HOLDINGS_INC

related topics

{loan, real, estate}

{regulation, change, law}

{stock, price, share}

{condition, economic, financial}

{acquisition, growth, future}

{product, market, service}

{product, liability, claim}

{provision, law, control}

{financial, litigation, operation}

{competitive, industry, competition}

PSB s business and earnings could be adversely affected by changes in general business and economic conditions, including increased credit risk and interest rate risk. PSB earnings could be adversely affected by the fiscal and monetary policies of the federal government and its agencies. The banking and financial services industry is highly competitive and increases in competitive levels could adversely affect PSB s financial condition and results of operations. Traditional geographic boundaries to commercial deposit collection and commercial loan origination are eroding, increasing competition against PSB s products. If PSB cannot attain comparable growth rates in loans and local deposits, it may have a material adverse effect on PSB s capital position and results of operations. PSB may lose fee income and deposits if a significant portion of consumers decide not to use banks to complete their financial transactions. PSB s funding costs may increase if consumers decide not to use banks as their primary source to invest liquid or other personal assets. PSB s market share may decline if it does not provide new products and services that gain market acceptance and regulatory approval. Investment to promote future growth of customers and new product types may not yield returns planned by management. Changes in laws and regulations could increase competition and PSB s operating costs. PSB has increased the size of historical commercial and industrial loan relationships, exposing PSB to potentially larger credit losses on one relationship in the event of default. The loss of key loan personnel may damage customer relationships and reduce PSB s loan volume and net earnings. Unexpected liabilities resulting from current or future claims or contingencies may have a material adverse effect on PSB s business, operating results, and financial condition. Potential acquisition or other expansion of our market may have a different result than planned and may have a material adverse effect on our business, operating results, and financial condition. PSB s accounting policies and methods are the basis of how PSB reports its financial condition and results of operations, and they may require management to make estimates about matters that are inherently uncertain. Unexpected tax liability as a result of examinations and challenges by tax authorities may harm PSB s financial condition and results of operations. Investors may not be able to liquidate their PSB holdings when desired because there is no active public trading market for PSB stock. PSB cannot guarantee continued cash dividend payments or that it will be able to meet its obligations to holders of its trust preferred securities. PSB s articles of incorporation could make more difficult or discourage an acquisition of PSB.

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948368--3/14/2007--PSB_HOLDINGS_INC_/WI/