Bank Directors Seminar, Coeur d'Alene, ID, September 15-17, 2019

Exhibit A - Capital Adequacy Risk Assessment

In accordance with The State Bank Capital Planning Policy, management shall on an annual basis identify all key risk areas impacting capital needs and capital planning. For each of those areas, a risk weighting shall be assigned based on the overall impact of this area to capital adequacy; the sum of all risk weightings shall equal 100%. For each risk area, management will then apply a rating from 1 to 3 with 1 being the lowest risk, 3 being the highest — along with an explanation of the rating. The resultant composite rating shall impact capital planning and capital thresholds for the ensuing period.

1=Low Risk to Capital 2=Moderate Risk to Capital 3=High Risk to Capital

Risk Rating

Risk Area

Risk Weight

Credit Quality (classified asset level, delinquencies, concentrations, changes in underwriting standards)

40%

2

Though significantly improved over the past five years, the Bank's level of classified assets remains elevated. Concentrations are within policy tolerances and underwriting standards remain conservative. Although the bank is considered to be liability sensitive, this is impacted significantly by a high level of non-maturity deposits which will likely lag in repricing. A parallel +300bp rate shock simulation actually shows a slight increase in NIM. The Bank's loan portfolio has increased by 2.4% over the past year and similar annual growth is anticipated over the next two years. Core net income has been more than sufficient to support this growth as well as dividend distributions. The Bank has significant excess liquidity and well exceeds all policy thresholds for current and three month liquidity. The Bank enjoys a large, low cost, core deposit funding base. The Bank is not currently entering new markets. Product/service changes over the last two years include a new core processing system, mobile banking, mobile deposit, and tablet banking. All service/product/vendor changes are thoroughly vetted and risk assessed. The holding company has an unused line of credit through Source Bank. There is some access to additional capital via existing shareholders.

Interest Rate Risk

2

10%

Strategic Risk acquisition, etc.)

(growth,

20%

1

Liquidity Risk/Funding Risk

5%

1

Operating Risk (new products, services, vendors, etc.)

1.5

10%

Access to Capital

1.5

15%

Weighted Average Composite Rating

1.63

2

-21-