Washington Federal, Inc. has previously disclosed that it holds approximately $90 million par value of Fannie Mae and Freddie Mac perpetual preferred stock. Such securities are held in the Company’s available for sale portfolio and as such are subject to a potential other than temporary impairment charge. The estimated fair market value of these securities has declined from $64 million at June 30, 2008 to $30 million as of August 27, 2008. The precise amount of losses or other than temporary impairment that may be incurred on these securities during the 4^th fiscal quarter is difficult to determine, given the significant volatility being experienced in the market values.

Although the Company has made no decision regarding the disposition of these assets, should they ultimately be a total loss, the Company’s tangible capital would still exceed 9% of assets providing a substantial margin over the 5% ratio used by its primary regulator to qualify for “well-capitalized” status.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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