Sandpoint-based Intermountain Community Bancorp, which operates Panhandle State Bank and Intermountain Community Bank, posted a full-year 2010 net loss of $33.5 million, or $3.99 per common share, compared with a net loss of $23.6 million, or $2.82 per common share, the previous year.

Intermountain attributed last year's net loss largely to a $24 million provision for loan losses and two noncash charges totaling $19 million. Its prior-year loss included $36.3 million in loan-loss provisions.

Total loans at the end of 2010 were $575.6 million, down from $672.3 million a year earlier. Total deposits were $779 million, down from $819 million at the end of 2009.

Curt Hecker, Intermountain's CEO, says the decline in deposits came mainly from brokered certificates of deposit, those traded in financial markets, which were at $40.9 million compared with $54.4 million in 2009.

"Our core deposits from customers increased," Hecker says.

Intermountain's total assets at year-end were at $1 billion, down from $1.08 billion at the end of 2009. Its nonperforming assets also declined last year, by $14.7 million to $15.9 million, or 1.59 percent of total assets, as of Dec. 31, down from 2.63 percent a year earlier.

"I anticipated the hard work that was going to be required within the industry, and our bank was able to take the very difficult steps to ensure future profitability" Hecker adds.

When asked about those challenges, Hecker referred to his comments in an Intermountain press release that focus on challenges with asset quality.

"Our asset quality continues to improve both with the decline in total nonperforming assets and a more favorable mix of loans in the portfolio," Hecker says in the press release. "Throughout 2009 and 2010, we have been very proactive in dealing with problem credits, taking write-downs early in the process and initiating dialogue with borrowers at the first sign of difficulty. Consequently, we have recorded significant loan loss provisions over the past three years, but now are seeing significant declines in both problem credits and other real estate owned."

Intermountain Community Bancorp operates four banking divisions with a total of 19 locations in three states. Panhandle State Bank serves eight North Idaho communities, while Intermountain Community Bank operates branches in southwest Idaho and Eastern Oregon.

Intermountain Community Bank Washington, which is a unit of Panhandle State Bank, operates branches in downtown Spokane and Spokane Valley. Another Panhandle subsidiary, Magic Valley Bank, has branches in Twin Falls and Gooding, Idaho.