This statement has been prepared in accordance with the regulatory requirements of the Office of Thrift Supervision (OTS). Home Federal Savings and Loan meets all capital requirements as follows: Tier 1 Leverage Capital was $22,978,000 exceeding the required 4% of assets; Risk-Based Capital was $23,134,000 exceeding the required 8% of risk-adjusted assets. Regulatory capital is a basis by which the OTS determines whether a savings association is operating in a safe and sound manner.