CODE OF ETHICS - revised September 20, 2005

Policy Statement
To the public, our customers, and others, each of us represents Home Federal Bancorp, Inc. ("Home Federal Bancorp") Home Federal Bank and the related entities. Maintaining the highest standards of professional and ethical conduct is essential in preserving the integrity of Home Federal Bank. We must all be continually sensitive to the fact that our actions, as viewed by disinterested observers, are subjected to close scrutiny and critical interpretation.

These sections outline the Code of Ethics Policy that has been reviewed and approved by the Board of Directors of Home Federal Bank. Home Federal Bank is committed to assisting all in determining what is appropriate personal and professional ethics and reaffirming Home Federal Bank's policy of ethical conduct that is in compliance with all state and federal laws. This policy applies to all employees as well as non-employee members of the Board of Directors of Home Federal Bank.

I. INTRODUCTION
All employees of Home Federal Bank must comply with this Code of Ethics at the commencement of their employment. Managers, employees, and technical personnel must modify system configurations and procedures, if necessary, to comply with the terms of this policy.

The business of Home Federal Bank and its affiliates includes a full array of banking products and related services. During the performance of our duties, it is necessary to interact with many constituencies. These persons place their trust in us and accordingly, we have the responsibility to keep this trust and be in strict compliance with all applicable laws and regulations.

Home Federal Bank requires corporate and affiliate directors, officers, and employees to observe a high standard of ethics in business and personal matters. The following Code of Ethics specifies certain standards for the guidance of all directors, officers, and employees. The Code should be considered as illustrative, but not regarded as all-inclusive.

Failure to comply with all policies and procedures may result in recommendation for termination of employment or service on the Board of Directors. Any questions regarding proper code of conduct should be referred to an immediate supervisor or to the Director of Human Resources.

II. GENERAL POLICIES

A. General

All directors, officers, and employees (referenced throughout this policy as "individuals" unless specifically identified) of Home Federal Bank have certain responsibilities that directly and indirectly reflect upon the reputation and successful business operation of Home Federal Bank. The most important personal aspects of Home Federal Bank are the trust and confidence of its depositors, customers, and employees. With this same basic principle in mind, all individuals of Home Federal Bank must ensure that honesty and integrity are among Home Federal Bank's highest priorities.

The following sections in this policy are to assist all individuals of Home Federal Bank in determining what is appropriate personal and professional ethics and reaffirms Home Federal Bank's policies of ethical conduct. The foundation of Home Federal Bank's Code of Ethics consists of basic standards of business, as well as personal conduct:

1. Honesty and candor in Home Federal Bank's activities, including compliance with the spirit, as well as the letter of the law.

2. Avoidance of conflicts between personal interests and the interests of Home Federal Bank, or even the appearance of such conflicts.

3. Maintenance of Home Federal Bank's reputation and avoidance of activities that might reflect adversely on Home Federal Bank.

4. Integrity in dealing with Home Federal Bank's assets.

5. Total compliance with laws and regulations.

At Home Federal Bank's discretion and judgment, Home Federal Bank may revise, withdraw, or add any rules, policies, or procedures at any time in order to maintain safe and efficient operation. Officers and employees should be aware that a violation of rules, policies, or procedures provides a basis for disciplinary action that may lead up to and include termination.

In all situations, including those where there are no applicable legal principles or the law is unclear or in conflict, all individuals of Home Federal Bank are expected to conduct themselves in such a manner that can be supported by Home Federal Bank, and to exercise good judgment in the discharge of their responsibilities.

B. Employer Responsibility

Home Federal Bank pledges all employees fair treatment, good career opportunities, and attractive working conditions, including pay and benefits. In return, it expects from all employees conscientious and professional work, high ethical standards, and observance of such special restrictions as may be required because of the fiduciary nature of an activity.

Specifically, Home Federal Bank, as an employer:

1. Seeks to promote equality of employment opportunity, career advancement, and to eliminate influences of bias based on race, religion, ethnic background, sex, and age.

2. Maintains ongoing affirmative action programs and expects supervisors and other employees to comply fully with the spirit as well as the text of these programs.

3. Makes job performance and job qualifications the basis of selection and promotion.

4. Recognizes that the dignity and individuality of each employee is entitled to respect by other employees.

5. Provides appropriate training, educational, and other opportunities for employees and encourages them to develop their capacities and realize their potential.

6. Attempts to make the best use of each employee's abilities when assigning duties, giving consideration to employee satisfaction and morale, as well as efficiency and cost.

7. Encourages timely, candid, and relevant exchange of information and an open-minded attitude to provide a free and open channel of communication, assure fair and equitable treatment of all employees, and create an atmosphere of understanding, cooperation, and mutual trust.

8. Safeguards the privacy of its employees and confidentiality of employee records as referenced in the Home Federal Bank's policy entitled "Privacy of Employee Records and Records Retention Guidelines."

C. Managers' Responsibility

Managers must exemplify the highest standards of conduct and ethical behavior. In addition, the manager's role is to help employees translate how our standards of conduct and ethics apply to their positions and everyday behavior. It is also the manager's role to enforce our standards. The Office of Human Resources is also available to help you when you have questions or need assistance.

D. Purchase of Assets from Home Federal Bank

Home Federal Bank employees are eligible to bid on miscellaneous items (e.g., computer equipment, furniture, fixtures, etc.), repossessed and foreclosed properties, or any other properties as described owned by Home Federal Bank when such items are available for sale. Bids will be based on the guidelines enforced by Home Federal Bank. Guidelines, including terms, are not to be overly favorable to an insider purchase when fair market is possible through external sales.

E. Integrity of Accounting and Records

A fundamental precondition of proper governance of any corporation is the reliability of all accounting information and records. To assure the absolute integrity of such information:

1. All entries to Home Federal Bank's books must be prepared with scrupulous accuracy and shall be consistent with the highest standards of accounting practice.

2. No false or artificial entries shall be made in any books or records of Home Federal Bank, and no employee shall engage in any arrangement that results in such entries.

3. No payment on behalf of Home Federal Bank shall be approved or any transaction made with the intention or understanding that part or all of such payment will be used for any purpose other than that described by the documents supporting it.

4. Any employee having information or knowledge of any unrecorded fund or asset or any prohibited act shall promptly report such activity to the President/CEO and the Audit Committee.

5. No fund, asset, or liability of Home Federal Bank shall, under any circumstances or for any purpose, be concealed or hidden.

6. Full cooperation with Home Federal Bank's internal audit procedures is imperative. False or misleading statements to auditors are considered to constitute a falsification of records and are grounds for dismissal.

7. No member of the staff, management, or any other person acting under the direction of an officer or director may fraudulently influence, coerce, manipulate, or mislead any independent public or certified accountant engaged in the performance of an audit of the financial statements of that company for the purpose of making financial statements materially misleading.

F. Conflict of Interest

All directors, officers, and employees should avoid situations, which could result in, or give the appearance of, a conflict of interest concerning Home Federal Bank to affiliates or customers or to the stockholders of Home Federal Bancorp. Personal interest, which could affect the proper exercise of judgment, must be avoided. In those cases where personal interests do exist, or may appear to exist, an officer or employee should disqualify himself or herself and permit other members of the staff to handle the transaction, and a director should disqualify himself or herself and abstain from discussion and voting on the matter.

In determining whether a conflict of interest could exist, directors, officers, and employees should remember that the rules also apply to their spouses and adult children, where appropriate. For example, a conflict of interest would arise where the spouse of an employee was offered a business opportunity on account of the employee's position at Home Federal Bank.

Employees may not hold a job over which a member of their immediate family exercises direct or indirect supervisory authority. Immediate family is defined as spouses, parents, children, and/or siblings, grandparents, in-laws, or cousins.

Acceptance of membership on outside boards involves possible conflicts of interest. Directors, officers, and employees are encouraged to participate in civic, charitable, and religious organizations; any other such organization, or position therewith, should be authorized by appropriate management. Situations, which might be in conflict with this policy, should be cleared with the President/CEO.

All individuals of Home Federal Bank are expected to take an objective look at their actions from time to time and inquire whether or not a reasonable, disinterested observer, a customer, a supplier, a stockholder, an acquaintance, or a government official, would have any grounds to believe:

1. The confidential nature of account relationships has been breached.

2. Fiduciary responsibilities have been handled in a less than prudent manner.

3. Business has been completed with Home Federal Bank only on the basis of friendships, family ties, gift receiving or giving, or to curry favor with special interest groups.

4. Individuals of Home Federal Bank to enhance their own opportunities when dealing with others in their political, investment, or retail purchasing activities use Home Federal Bank's name as leverage.

5. The needs of the stockholders and public are not considered in making business decisions.

In the event a potential conflict of interest does arise involving an officer or employee, its nature and extent should be fully disclosed immediately to the President/CEO who, after making a thorough review of the circumstances, will determine appropriate action to be taken.

In the event a potential conflict of interest does arise involving the President/CEO, its nature and extent should be fully disclosed immediately to one of the members of the Board of Directors who, after conducting a thorough review of the circumstances, will determine appropriate action to be taken.

In the event a potential conflict of interest does arise involving a member of the Board of Directors, its nature and extent should be fully disclosed immediately to the Chairman of the Board, who after investigating the circumstances will determine appropriate action to be taken.

G. Fiduciary Appointments

Officers and employees must not accept appointment as personal representative, trustee, co-trustee or other fiduciary position of a Home Federal Bank customer, unless the will or trust agreement involves the individual's family relationship. Nor shall such officer or employee accept a legacy under the will or trust agreement of a Home Federal Bank customer with whom the individual has dealt, unless a family relationship exists. There may be specific circumstances that warrant exceptions to this. All exceptions are to be approved in writing by the President/CEO.

Those directors who serve in a fiduciary role in their professional capacity are encouraged to avail themselves of Home Federal Bank services, keeping in mind that their responsibility lies in representing their client's best interest ahead of Home Federal Bank's in any such dealings.

H. Beneficiary or Legacy

Officers and employees must report any gift of a beneficial interest or legacy under will or trusts of customers of Home Federal Bank, other than relative, at such time as the individual learns of the designation. The objective of such a notification requirement is to allow for consideration of all of the facts in each case to make certain there are no real conflicts of interest and that a reasonable, disinterested third party could not allege a conflict of interest upon the officer or employee in receipt of this benefit. If this reporting requirement results in a decision that a real or apparent conflict exists or could exist, the officer or employee will be expected to make every effort to be relieved of the expectation of benefit and will probably be required to renounce the gift should it come to the individual by operation of law.

If a beneficial interest or legacy becomes payable to an officer or employee by reason of death of a customer or otherwise, and the early notification procedure set forth above has not been followed, ordinarily the individual will be required to renounce the gift unless there is a showing that the individual's relationship with the settler or testator predated significantly either the individual's hiring by Home Federal Bank or the initiation of business with Home Federal Bank by the settler or testator.

I. Self-Dealing

Individuals of Home Federal Bank are prohibited from:

1. Owning any interest in another company or business which might materially benefit by an action or decision consummated by such officer or employee on behalf of Home Federal Bank; or

2. Representing Home Federal Bank in any transaction with a person or organization in which the individual has a direct interest or from which benefits may be derived.

The officer or employee in writing to the President/CEO must report any significant interest in a company or business having a banking relationship with Home Federal Bank, whether or not the officer or employee deals with that particular company. No supplier of Home Federal Bank shall hold or acquire any interest in such business unless the securities representing such interest are widely held (i.e., traded on the national exchange or in the over-the-counter market). Home Federal Bank employees must disclose all potential conflicts of interest, including those in which they have been inadvertently placed due to either business or personal relationships with customers, suppliers, business associates, or competitors of Home Federal Bank.

Individuals of Home Federal Bank must never use their position with Home Federal Bank to influence public officials or others for personal benefit or for the benefit of another party. Likewise, employment with Home Federal Bank should not be used as leverage to gain favors from customers or suppliers.

J. Signing on Customers' Accounts

To avoid the appearance of a conflict, all individuals of Home Federal Bank should not sign on customers' accounts, have access to their safe deposit boxes, or otherwise represent customers. This does not include situations where individuals of Home Federal Bank act in an ownership capacity or act because of a close family relationship.

K. Confidential Information

The confidential nature of bank accounts and company resources in general is a fundamental precept in financial services. It is important that our directors, officers, and employees be constantly alert to the responsibility of maintaining confidentiality.

All information obtained by virtue of employment with or service to Home Federal Bank should be held in strictest confidence. This includes financial and personal information of customers, including fellow employees, as well as Home Federal Bank's financial information and information related to its internal affairs, competitive position, strategic planning, and regulatory actions. Confidential information must not be disclosed to anyone except as required for business transactions or as required by law. When disclosing confidential information, do so in a manner that does not risk violating confidentiality.

Confidential information pertaining to Home Federal Bank and its related entities, customers, suppliers, stockholders, and employees is to be used solely for corporate purposes and not as a basis for personal gain by directors, officers, or employees.

In certain instances, confidential information could be considered "insider information" within the meaning of federal and state securities laws. Disclosure or use of such information for personal gain or for avoiding personal loss could result in substantial civil and criminal penalties to individuals who disclose or who use this information. Directors, officers, and employees must be extremely cautious in discussing the corporate affairs of Home Federal Bank and its related entities with customers or outsiders, including with stockholders of Home Federal Bancorp who do not have a right to such information before an announcement is made to all stockholders of Home Federal Bancorp.

1. Trading in Home Federal Bancorp's Stock

Directors, officers, and employees are encouraged to participate and maintain ownership in the stock of Home Federal Bancorp. While there are occasions that dictate the purchase or sale of any investment, active buying and selling of Home Federal Bancorp's common stock in order to make short term profits is discouraged. The Securities and Exchange Commission has stringent rules and regulations related to trading securities while in the possession of material, non-public information.

There may be occasions when you become aware of certain facts related to Home Federal Bank such as earnings, expansion plans, a potential acquisition, or other similar situations which may reasonably be expected to be important to the investing public. Insider information is information that has not been publicly released and which a reasonable person would consider important in determining whether to buy, sell, or hold securities. Until such information is disseminated to the general public through a press release or other public announcement, directors, officers, and employees are prohibited from either purchasing or selling Home Federal Bancorp's stock. Violation of this policy could subject directors, officers, or employees to possible action by the Securities and Exchange Commission, the result of which may include fines and/or imprisonment. Should any director, officer, or employee desire to acquire or sell Home Federal Bancorp's stock while knowledgeable of information, which has not been released, to the public, inquiries for advice should be made to the Chief Financial Officer.

Directors and officers are reminded that they are subject to Home Federal Bancorp's Policy and Procedures Governing Trading in Securities and Confidentiality of Inside Information for Officers and Directors.

2. Protecting Home Federal Bank Information

All Home Federal Bank information must receive protection against unauthorized access, modification, destruction or disclosure. Individuals of Home Federal Bank must follow applicable policies and procedures and safeguard information in whatever forms it exists (i.e., electronic or hard copy). Deliberate or willful violations of existing policies for protecting Home Federal Bank information or negligent failure to protect Home Federal Bank information properly may result in disciplinary actions.

3. Disclosure of Corporate News and Information

Financial information about Home Federal Bank and its affiliates is not to be released to anyone unless it is included in a published report or otherwise made generally available to the public. Officers or employees with questions concerning the disclosure of confidential information should be referred to the President/CEO.

All media inquiries regarding Home Federal Bank and its affiliates should be referred to the President/CEO. The following subjects are never to be discussed with the media or in any public forum:

a) Confidential business matters, which could be of interest to competitors.

b) Information about a customer and the customer's dealings with Home Federal Bank.

c) Information about an employee or former employee.

4. Information Regarding Past and Present Employees

The policy of Home Federal Bank is to safeguard the confidential aspects of its relationship with its officers and employees; to satisfy all requirements of applicable labor laws; and to maintain uniformity in replies to inquiries concerning past and present officers and employees. In order to assure that this policy is consistently maintained, any request for information regarding past or present officers and employees must be referred to the Office of Human Resources. This includes salary verification and date of last employment.

The above procedures apply to all requests, whether written or oral, regarding Home Federal Bank, past or present, employment, including routine credit inquiries from legitimate businesses regarding deposit or loan information.

L. Gifts, Gratuities, and Other Payments From Customers

1. In the matter of gifts and gratuities to directors, officers, or employees, circumstances must govern. Substantial gifts and excessive entertainment offered because of your affiliation with Home Federal Bank should be courteously and tactfully declined. Commissions, fees, or propositions involving personal gain to a director, officer, or employee in connection with a transaction are highly improper and in some cases, illegal.

2. Individuals may not accept cash gifts from customers that are not relatives. For the purpose of this policy, a relative is any person who is related by blood or marriage, or whose relationship with the employee is similar to that of persons who are related by blood or marriage If a customer gives an employee cash, the employee should thank the customer and explain that Home Federal Bank policy prohibits accepting cash from customers.

3. The above prohibits any officer, director, employee, agent, or attorney of a financial institution, or holding company except as provided by law, from corruptly soliciting or receiving anything of value for or in connection with any transaction or business of the financial institution. The thing of value may not be for the benefit of the official or of any other person or entity (other than the financial institution itself). Salaries, fees or related benefits paid by the financial institution to its own officers, employees, and agents are not encompassed within the provisions of the provisions of the subsection.

4. Officers or employees who are offered or who anticipate receiving a gift or other things of value that is not permitted under the above guidelines must report it promptly in writing to their immediate supervisor and Executive Management.

5. Officers, employees or their immediate family shall not solicit for themselves or a third party (other than Home Federal Bank) anything of value from anyone in return for any business, service, or confidential information of Home Federal Bank. Moreover, officers, employees or anyone in their immediate family may not accept anything of value (other than the individual's salary or commissions from Home Federal Bank) from anyone in connection with the business of Home Federal Bank, either before or after a transaction is discussed or consummated. Criminal penalties may be imposed for violating these prohibitions.

6. The preceding prohibitions are not applicable to entertainment or hospitality of a "reasonable" value, or gifts (but never cash), which under the circumstances, are of limited or nominal value. Whenever possible, Home Federal Bank should pay the expenses of a director, officer, or employee. Frequent invitations from customers or vendors for meals or entertainment should be declined or handled with firm insistence that the director, officer, or employee pays for alternate meals. The acceptance of gifts of more than a nominal value could be considered as an attempt at bribery and could subject both the giver and the recipient to felony charges as well as the penalties prescribed under the Bank Bribery Act, 18 U.S.C. 215. The Bank Bribery Act also covers agents or attorneys of a financial institution.

7. Possible exceptions to the general prohibition regarding the acceptance of things of value may include:

a) Acceptance of gifts, gratuities, amenities or favors based on family relationships (such as those between the parents, children or spouse of a Home Federal Bank officer or employee) where circumstances make it clear that it is those relationships, rather than the business of Home Federal Bank, which are the motivating factors.

b) Acceptance of meals, refreshments, travel arrangements, accommodations, or entertainment, all of reasonable value and in the regular course of a meeting or other occasion, the purpose of which is to hold a bona fide business discussion, provided the expenses would be paid for by Home Federal Bank as a reasonable business expense, if not paid for by another party.

c) Acceptance of loans from other banks or financial institutions on customary terms to finance proper and usual activities of Home Federal Bank officers or employees, such as home mortgage loans, except where prohibited by law.

d) Acceptance of advertising or promotional material of nominal value, such as pens, pencils, note pads, key chains, calendars and similar items.

e) Acceptance of discounts or rebates on merchandise or services that are offered by a third party to all the officers and employees of Home Federal Bank, or through a program approved by Home Federal Bank, or to the general public.

f) Acceptance of gifts of modest value related to commonly recognized events or occasions, such as a promotion, new job, wedding, retirement, holiday or bar or bas mitzvah. If an officer or employee, or a member of his or her family, receives a gift which exceeds in value that might be considered reasonable in light of this policy, they should report the receipt of such gifts to the Security Officer to see if the retention of such a gift is acceptable under this policy.

g) Acceptance of civic, charitable, educational, or religious organizational awards for recognition of service and accomplishment.

8. Officers and employees who are uncertain as to the propriety of a gift must seek the written approval of their immediate supervisor before accepting it. The request should be in writing and should state all relevant facts. It is then the supervisor's responsibility to forward a copy of the request along with the supervisor's recommendation to his / her manager.

9. Full and timely disclosure to the Director of Human Resources must be made with respect to entertainment, hospitality, or gifts received. Any question or doubt as to the appropriateness of their receipt should be referred to and resolved by the Director of Human Resources on a timely basis. The tactful communication of the limitations of this policy to the donors of gifts is also strongly encouraged.

M. Anti-Trust Rules - Charges and Pricing

Interest rates on deposits and loans, terms of loans, service charges, and other similar matters will be determined solely on the basis of what is in the best interest of Home Federal Bank and its customers. Under no circumstances should any agreements or understandings be established with any other financial institution concerning such charges. Home Federal Bank is individually responsible for its policies and operating procedures.

It is important that no comments be made or actions taken by directors, officers, or employees that could be misinterpreted as an agreement to cooperate with competitors in following a common course of action as to rates of interest paid, the terms on which loans are made, hours, or the price of services offered to customers. Situations where discussions with competitors are permissible are strictly limited to circumstances where action by a banking group is warranted, such as an extension of a term loan by a group of banks or a potential bad loan situation where cooperation among lenders is necessary to assist the borrower in working out financial problems.

N. Fidelity Coverage

Every officer and employee must be covered by Home Federal Bank's fidelity bond. Home Federal Bank will not continue to employ anyone who ceases to be eligible for coverage.

Coverage under the terms of Home Federal Bank's fidelity bond ceases for anyone who has been found to commit a dishonest or fraudulent act. Obviously, this includes the misappropriation of money or other property. It also includes the misposting of accounts to favor oneself or another, the kiting of checks, the making of false entries, records or reports, and the deliberate misrouting of checks to delay payment.

O. Undesirable Business

Directors, officers, and employees may not discriminate in the acceptance of business brought to us by reputable persons. However, it should also be kept in mind that accounts or loans requested from known controversial or unsavory persons or firms should generally be declined. Such relationships could lead to loss and embarrassment for Home Federal Bank and should be very carefully considered.

P. Personal Reputation

Loyalty, fidelity, and good morals are assumed qualities of those who represent Home Federal Bank but, nevertheless, need to be emphasized. It is imperative that each individual display conduct at all times so as to reflect credit on Home Federal Bank and its directors, officers, and employees. A reputation for good morals, ethics, and integrity is within the reach of all, and officers and employees must remain above reproach throughout their business career.

Home Federal Bank and its officers and employees may be subject to penalties if they violate any laws. It is, therefore, important that officers and employees be familiar with the laws and regulations governing the line of business in which they work and that officers and employees be careful to ensure that those laws and regulations are in full compliance. Compliance with laws and regulations is everyone's responsibility. Officers and employees who commit illegal acts could be subjected to disciplinary action, which may include termination.

Additionally, it is the responsibility of all officers and employees to report all instances of known or suspected illegal activity on the part of any officer, employee, agent or customer of Home Federal Bank. If it is uncertain as to the propriety of an individual's actions, contact the Director of Human Resources to obtain clarification. Officers and employees must promptly notify the Security Officer if it is suspected that an officer, employee, agent, or customer has committed an illegal act or the discovery of any circumstances that suggest that a crime has been committed. Failure to report suspected illegal activities properly as outlined in this policy might subject that officer or employee to disciplinary action including, if appropriate, termination. Home Federal Bank is required by law to report violations of criminal laws to state and/or federal law enforcement agencies.

Home Federal Bank policy prohibits any form of retaliatory action toward an officer or employee who notifies Home Federal Bank of a suspected illegal act or participates in the investigation of a complaint.

Dishonest and fraudulent acts by Home Federal Bank officers and employees are crimes under federal and state law, and may be punishable by fines and/or imprisonment. Examples of activities prohibited by law include:

1. Accepting anything of value (except an individual's salary or other compensation paid or sanctioned by Home Federal Bank) in connection with the business of Home Federal Bank. (Refer to the section of this Policy for detailed description of Home Federal Bank's policy regarding Gifts, Gratuities, and Other Payments from Customers.)

2. Stealing, embezzling or misapplying corporate funds or assets.

3. Using threats, physical force, or other unauthorized means to collect money.

4. Issuing unauthorized obligations (such as certificates of deposit, notes, mortgages or commitments) or making false entries.

5. Unless specifically permitted by law, making a loan or giving a gift to a regulator who has the authority to examine Home Federal Bank.

6. Using a computer to gain unauthorized access to the records of a customer.

7. Concealing or misapplying any of Home Federal Bank's assets.

8. Loaning funds to, or depositing funds with third parties with the understanding, express or implied, that the party receiving such funds will make a loan or pay any consideration to the officer or employee.

Q. Community and Political Activity

As an institution, Home Federal Bank cannot and should not engage in politics. Directors, officers, and employees, however, are encouraged to stay well informed on local, state, and national affairs and to meet their responsibility to vote in all elections.

Directors, officers, and employees should ensure that their participation in political activities in no way reflects unfavorably on Home Federal Bank. Community and political activities by directors, officers, and employees are encouraged, provided that participation:

1. Is accomplished in a legal manner.

2. Does not interfere with work performance for Home Federal Bank.

3. Is not deemed to be divisive in the community.

4. Occurs in such a manner, which clearly indicates that the director, officer, or employee does not speak for Home Federal Bank.

Before running for an elected political office or accepting an appointment to a federal, state, or local government office, the director, officer, or employee must discuss the position with Home Federal Bank's Chief Executive Officer.

Federal law prohibits Home Federal Bank from making political contributions to parties or candidates. Loans to political parties or candidates are also generally prohibited. The use of any corporate funds, supplies, special services, equipment, or labor for political purposes must be avoided as such use is illegal. Additionally, no reimbursement will be made to any individual for political contributions or for the cost of attendance at any political function. Fund-raising efforts for any purpose should be avoided if there is any possibility of an adverse effect on the reputation of Home Federal Bank.

R. Illegal Activity

Directors, officers, and employees are expected to abide by all local, state, and federal laws, regulations, and guidelines. Officers or employees engaged in activities found to be in conflict with and against these laws, regulations, or guidelines will be subject to termination of employment. Examples of illegal activity include, but are not limited to:

1. Embezzlement
2. Unauthorized sale of information
3. Frauds such as forgery, counterfeiting, and check kiting
4. Unauthorized use of funds, revenues, and fees
5. Abuse of expense, asset, and liability accounts
6. Sexual harassment or discrimination

In addition, any director, officer, or employee who is charged with, or is entering into a pretrial diversion or similar program for any crime involving breach of trust, dishonesty, money laundering, a drug-related offense, a crime of violence, or a felony must immediately notify the Director of Human Resources.

S. Competition

The competition between Home Federal Bank and other financial institutions must always be positive. The best possible service and personal interest in our customers are much ore effective than the criticism of a competitor. Such criticism is not in keeping with the character of Home Federal Bank and should have no place in the conversation of directors, officers, and employees.

Federal law prohibits any combination, conspiracy or agreement among competitors to restrict or prevent competition. A violation of the law can occur through a formal or informal agreement between Home Federal Bank and a competitor to:

1. Fix prices.
2. Allocate markets or customers.
3. Refuse to deal with particular suppliers or customers.

All individuals of Home Federal Bank in contact with Home Federal Bank's competitors must avoid any agreements with them (or even circumstances that might give the appearance of such agreements) relating to how Home Federal Bank conducts its business. All individuals of Home Federal Bank should especially be careful at social or professional meetings. Discussions or exchanges of information relating to competitive matters (i.e., cost, pricing, or strategy) must carefully be avoided.

Officers and employees with questions concerning antitrust issues should be directed to their immediate manager or any executive officer.

T. Money Laundering Activities/Bank Secrecy Act

Both federal and state law prohibits the laundering of money. Money is laundered to hide criminal activity associated with it, including the crimes by which it is generated (i.e., drug trafficking, tax avoidance, counterfeiting, etc.). Officers and employees need to "know their customer" and be alert to the dangers to Home Federal Bank should it, even unwillingly, become involved in receiving or laundering proceeds of crimes. Regulators require banks to report any known or suspected criminal activity, such as the laundering of monetary instruments or structuring of transactions to avoid Bank Secrecy Act requirements (refer to Home Federal Bank's Secrecy Policy for specific reporting requirements). Officers and employees should contact the Security Officer immediately in the event any known or suspected criminal activity or transaction comes to their attention.

U. Outside Employment

Home Federal Bank does not prohibit outside employment; however, officers and employees are expected to devote full-time attention and energy to their career with Home Federal Bank. Significant outside employment or employment in positions or establishments which may result in adverse public reaction must be avoided. Home Federal Bank policy requires that officers and employees inform their immediate supervisor prior to accepting any outside employment. The immediate supervisor is to inform the Office of Human Resources. No outside employment of any kind will be approved which might subject Home Federal Bank to criticism or which would encroach upon working time, interfere with regular duties, or necessitate such long hours as to affect the individual's effectiveness.

Officers and employees must avoid outside employment that involves or may appear to involve a conflict of interest. Examples include:

1. Employment by a company or personally engaging in any activity that is competitive with Home Federal Bank.

2. Employment that involves the use of Home Federal Bank's equipment, supplies or facilities.

3. Employment which involves the preparation, audit or certification of statements, tax returns, or other documents upon which Home Federal Bank may place reliance for lending or other purposes. Officers and employees who prepare income tax returns for individuals or entities other than the themselves must obtain confirmation from their potential client that the client does not intend to use the officer's or employee's work product as part of any transaction with Home Federal Bank.

4. Employment that involves the rendering of investment, legal or other advice, or exercising judgment which is based upon information, reports or analyses that are accessible primarily from or through the individual's employment with Home Federal Bank.

5. Employment which may reflect adversely on the officer, employee, or on Home Federal Bank.

6. Employment under circumstances that may suggest the sponsorship or support of Home Federal Bank on behalf of the outside employer or an outside organization.

7. Employment as an insurance or securities broker, agent, or representative.

8. Employment as a real estate salesman, broker, agent or contractor (except with the prior written approval of the officer's or employee's immediate supervisor with concurrence of Executive Management). Prior written approval is required since there are a number of potential conflict of interest situations, as well as possible violations of banking laws, which must scrupulously be avoided in this area).

V. Advice To Customers

1. Legal Advice

Officers and employees may on occasion be asked by customers to make statements that relate to the legality of particular transactions. Home Federal Bank cannot practice law or provide legal advice. As such, officers and employees must exercise care in discussions with customers. Nothing must be said which might be interpreted as the giving of legal advice.

Officers or employees with questions as to whether legal advice is being requested should consult with their supervisor or Executive Management.

2. Tax or Investment Advice

Officers and employees must avoid giving customers advice on tax matters, the preparation of tax returns, or in investment decisions, except as may be appropriate in the performance of a fiduciary responsibility, or as otherwise required in the ordinary course of duties.

3. Recommending Other Firms

During the course of contact with customers and the general public, officers and employees may be asked to recommend others who provide professional services. Typically, such requests involve attorneys, accountants, securities dealers, insurance agents, brokers, and real estate agents. Home Federal Bank, excluding only referral arrangements made by Home Federal Bank, must give customers who receive recommendations several qualified sources without indicating any preference or warranty.

W. Lending Relationships And Prohibited Lending Practices

1. Borrowing

To avoid possible conflicts of interest, loan applications submitted to officers and employees by relatives or close personal friends (or entities controlled by relatives or close personal friends) are to be submitted to other independent lending officers or employees of equal or higher position for processing and approval. With the same respect, loan applications submitted to directors by relatives or close personal friends (or entities controlled by relatives or close personal friends) are to be submitted through the normal lending channels. This policy also applies to the processing and approval of overdrafts, waiver of service charges, and other free services.

2. Lending Relationships

It is the position of Home Federal Bank that lending services be available to serve the legitimate and deserving credit needs of all customers on an equal basis. Loan terms and conditions shall be based on the borrower's credit worthiness and banking relationships.

Directors and Executive Officers are required to comply with the provisions of Regulation O, "Loans to Executive Officers, Directors, and Principal Shareholders of Member Banks", relative to all Home Federal Bank borrowing.

3. Prohibited Lending Practices

Any transaction between an officer or employee of Home Federal Bank and a customer of Home Federal Bank must be conducted on an "arm's length basis", meaning the officer or employee may not receive any discount or other benefit not normally granted to others. Additionally, no officer or employee shall borrow directly from another employee.

Officers and employees may not borrow money from customers or suppliers (including personal friends) of Home Federal Bank, except from recognized lending institutions. The term "borrow" does not include a purchase from a customer or supplier resulting in an extension of credit in the normal course of business.

Lending officers are not permitted to process loan applications or to extend credit to members of their immediate family. Immediate family is defined as spouses, parents, children, and/or siblings, grandparents, in-laws, or cousins. Any such loan application must be referred to another lending officer.

X. Solicitation Policy

1. General

This section is designed to protect Home Federal Bank employees against the unauthorized solicitation by other employees and non-employees with regard to such issues as the purchase of goods or services, or rendering support to political or non-political acts.

2. Solicitation of Employees by Other Home Federal Bank Employees

It is the policy of Home Federal Bank that on-duty employees are not allowed to solicit other Home Federal Bank employees or distribute unauthorized materials as follows:

a) Oral/Written Solicitation. An employee may not solicit another employee either orally or with written material while either employee is on "working time." The term "working time" does not include an employee's meal times or break periods when an employee is released from the performance of his or her work, whether such periods are paid for or not.

Solicitation includes such activities as requests for signatures, contributions for charities, merchandise purchases and requests for donations. An example of such material includes, but is not limited to, the sale of food, selling raffle tickets for a charity, and / or selling cosmetics, etc.

Home Federal Bank employees are permitted to transmit brief personal e-mail messages to co-workers as long as the messages do not interfere with normal business activities, involve solicitation, are not associated with any for-profit outside business activity, and do not contain information that may potentially embarrass or damage Home Federal Bank, Home Federal Bank's customers, or employees. Refer to Home Federal Bank's Technology Policy for additional information.

b) Distribution of Handouts/Literature. Distribution by employees of advertising materials, handouts or literature on Home Federal Bank property is prohibited at all times. Exceptions may be made for Home Federal Bank sponsored activities. Bulletin boards are reserved for Home Federal Bank notices or required legislative notices or posters only. Examples of such material include, but are not limited to the posting of notices advertising a local church bazaar or handing out pamphlets for a congressional candidate qualifies as distribution.

3. Solicitation of Employees by Outside Sources

Non-employees are prohibited from soliciting employees on Home Federal Bank property, either by personal contact or written communication. Non-employees are not permitted access to the interior of Home Federal Bank's facilities or outside working areas except to avail themselves of customer services.

4. Solicitation of Home Federal Bank Sponsored Events

Home Federal Bank may authorize a limited number of fund drives by employees on behalf of charitable organizations or for Home Federal Bank sponsored activities. Employees are encouraged to volunteer to assist in these drives, but their participation is entirely voluntary.

Y. Speeches And Articles For Publication

Officers or employees may not speak on behalf of Home Federal Bank nor discuss Home Federal Bank's policies or procedures in articles, speeches or presentations without the prior consent of the individual's immediate supervisor and/or the Executive Leadership Team.

Officers and employees may not use official Home Federal Bank stationery for personal correspondence or other non-work related purposes.


Officers, employees or their immediate family may not solicit honoraria for public speaking or writing services performed on behalf of Home Federal Bank or by reason of the fact that the individual is an employee of Home Federal Bank. Officers and employees, however, may accept reimbursement of related expenses for such services.

III. Special Ethical Obligations of the Chief Executive Officer and Senior Financial Officers

This section of the Code sets forth certain standards for the guidance of the Chief Executive Officer, the Chief Financial Officer, the Principal Accounting Officer, Controller, or persons performing similar functions ("Senior Financial Officers").

1. Honest and Ethical Conduct

Each Senior Financial Officer must act honestly and ethically. Senior Financial Officers should also promote honest and ethical behavior within Home Federal Bank.

Acting honestly and ethically includes the duty to avoid actual or apparent conflicts of interest, as well as situations that could result in an actual or apparent conflict of interest. A conflict of interest may arise when personal or financial interest is adverse to, or appears adverse to, the interests of Home Federal Bank. Each Senior Financial Officer should report to the Audit Committee of the Board of Directors any material transaction or relationship that reasonably could be expected to result in a conflict of interest.

In addition to the duty to avoid conflicts of interest, Senior Financial Officers must treat confidential information properly. All information obtained by virtue of employment with Home Federal Bank should be held in strictest confidence. Confidential information must not be disclosed to anyone except as required for business transactions or as required by law. When confidential information is disclosed, it must be done in a manner that does not risk violating confidentiality.

2. Preparation of Public Documents

Each Senior Financial Officer must ensure that all public documents and documents filed with the Securities and Exchange Commission which he or she is involved in preparing or reviewing contain full, fair, accurate, timely, and understandable disclosure. In order to ensure this, the Senior Financial Officers must maintain the skills relevant to Home Federal Bank's and its affiliates needs. The Senior Financial Officers are also responsible for establishing and maintaining appropriate disclosure controls and procedures and internal controls.

3. Compliance with Laws, Rules, and Regulations

Each Senior Financial Officer must comply with all local, state, and federal laws, rules, and regulations. Any Senior Financial Officer engaged in activities found to be in conflict with and against these laws, rules, and regulations will be subject to termination of employment. The Senior Financial Officers should also cause other officers and employees to comply with all local, state, and federal laws, rules, and regulations.

IV. Administration of the Code

Any violation or suspected violation of this Code of Ethics must be promptly reported to the Audit Committee of the Board of Directors. Violators of the code may be subject to disciplinary action, up to and including termination of employment. Questions regarding the code and requests for a waiver from the Code should be brought to the Audit Committee. The Audit Committee will administer the Code and will make periodic reports to the Board of Directors, as necessary.

This Code of Ethics shall be publicly available. Changes to, and waivers from, the section of the Code specifically applicable to Senior Financial Officers shall also be disclosed to the public as required by law or stock exchange regulations. Waivers of the Code of directors or executive officers must be approved by the Board of Directors, and disclosed in a Current Report on Form 8-K.