Fitch Revises Sterling Financial's & Sterling Savings Bank's Rating Outlook to Positive.

NEW YORK -- Fitch Ratings has revised the Rating Outlook for Sterling Financial Corporation (STSA) and Sterling Savings Bank to Positive from Stable. A complete list of ratings is provided at the end of this release.

The Outlook change reflects the continued progress that STSA has made improving both its franchise as well as its balance sheet structure. Through acquisitions, as well as organic growth, STSA has created a Pacific Northwest franchise with approximately $7.0 billion in assets and 138 branches in four states. Additionally, the company has been transforming itself from a thrift to a more community banking oriented entity and, highlighting this transformation, has recently applied to change to a Washington state-chartered commercial bank charter.

An improving level of earnings, strong asset quality, and stable levels of capitalization are the drivers of Fitch's Outlook revision. The successful continuation of these trends and the additional accumulation of capital, specifically tangible common equity, remains an opportunity for a change in ratings.

The following ratings are affirmed by Fitch:

Sterling Financial Corporation

--Long-term issuer 'BB+';

--Short-term issuer 'B';

--Individual rating 'C';

--Support '5';

--Outlook to Positive.

Sterling Savings Bank

--Long-term deposit 'BBB-';

--Short-term deposit 'F3';

--Long-term issuer 'BB+';

--Short-term issuer 'B';

--Individual 'C';

--Support '5';

--Outlook to Positive.

Fitch's rating definitions are available on the agency's public web site, www.fitchratings.com. Published ratings, criteria and methodologies, and relevant policies and procedures are also available from this site, at all times. This document will remain on the public site for seven days.